Document:

EMCORE CORP. 8-K EX-10.1 -- 2000 STOCK OPTION PLAN - REVISED 2/13/06

    
      
        

      

    

    Exhibit
      10.1

     

    EMCORE
      CORPORATION

    
       

      AMENDED
        AND RESTATED 2000 STOCK OPTION PLAN

      Revised
        February 13, 2006

       

      1. Purposes.
        The
        purposes of the EMCORE
        Corporation 2000 Stock Option Plan are to give officers and other employees,
        consultants and non-employee directors of the Company and its Affiliates
        an
        opportunity to acquire shares of Stock, to provide an incentive for such
        employees, consultants and directors to continue to promote the best interests
        of the Company and its Affiliates and enhance its long-term performance and
        to
        provide an incentive for such employees, consultants and directors to join
        or
        remain with the Company and its Affiliates. Toward these objectives, the
        Committee may grant Options to such employees, directors and consultants,
        all
        pursuant to the terms and conditions of the Plan.

       

      2. Definitions.
        As used
        in the Plan, the following capitalized terms shall have the meanings set
        forth
        below:

       

      (a) “Affiliate”
-
        other
        than the Company, (i) any corporation or limited liability company in an
        unbroken chain of corporations or limited liability companies ending with
        the
        Company if each corporation or limited liability company owns stock or
        membership interests (as applicable) possessing more than fifty percent (50%)
        of
        the total combined voting power of all classes of stock in one of the other
        corporations or limited liability companies in such chain; (ii) any corporation,
        trade or business (including, without limitation, a partnership or limited
        liability company) which is more than fifty percent (50%) controlled (whether
        by
        ownership of stock, assets or an equivalent ownership interest or voting
        interest) by the Company or one of its Affiliates; or (iii) any other entity,
        approved by the Committee as an Affiliate under the Plan, in which the Company
        or any of its Affiliates has a material equity interest.

       

      (b) “Agreement”
-
        a
        written stock option award agreement evidencing an Option, as described in
        Section 3(e).

       

      (c) “Award
        Limit”
-
        300,000 shares of Stock (as adjusted in accordance with Section
        10).

       

      (d) “Beneficial
        Ownership”
-
        (including correlative terms) shall have the same meaning given such term
        in
        Rule 13d-3 promulgated under the Exchange Act.

       

      (e) “Board”
-
        the
        Board of Directors of the Company.

       

      (f) “Change
        in Control”
-
        the
        occurrence of any of the following:

       

      (i)
        an
        acquisition in one transaction or a series of related transactions (other
        than
        directly from the Company or pursuant to Options granted under the Plan or
        other
        similar awards granted by the Company) of any Voting Securities by any Person,
        immediately after which such Person has Beneficial Ownership of fifty percent
        (50%) or more of the combined voting power of the Company’s then outstanding
        Voting Securities; provided,
        however,
        in
        determining whether a Change in Control has occurred pursuant to this Section
        2(f), Voting Securities which are acquired in a Non-Control Acquisition shall
        not constitute an acquisition that would cause a Change in Control;

       

      (ii)
        the
        individuals who, immediately prior to the Effective Date, are members of
        the
        Board (the “Incumbent
        Board”),
        cease
        for any reason to constitute at least a majority of the members of the Board;
        provided,
        however,
        that if
        the election, or nomination for election, by the Company’s common stockholders,
        of any new director was approved by a vote of at least a majority of the
        Incumbent Board, such new director shall, for purposes of the Plan, be
        considered as a member of the Incumbent Board; provided
        further,
        however,
        that no
        individual shall be considered a member of the Incumbent Board if such
        individual initially assumed office as a result of either an actual or
        threatened “Election Contest” (as described in Rule 14a-11 promulgated under the
        Exchange Act) or other actual or threatened solicitation of proxies or consents
        by or on behalf of a Person other than the Board (a “Proxy
        Contest”)
        including by reason of any agreement intended to avoid or settle any Election
        Contest or Proxy Contest; or

       

      (iii)
        the
        consummation of:

       

      (A)
        a
        merger, consolidation or reorganization involving the Company unless:

       

      (1)
        the
        stockholders of the Company, immediately before such merger, consolidation
        or
        reorganization, own, directly or indirectly, immediately following such merger,
        consolidation or reorganization, more than fifty percent (50%) of the combined
        voting power of the outstanding voting securities of the corporation resulting
        from such merger or consolidation or reorganization (the “Surviving
        Corporation”)
        in
        substantially the same proportion as their ownership of the Voting Securities
        immediately before such merger, consolidation or reorganization,

       

      (2)
        the
        individuals who were members of the Incumbent Board immediately prior to
        the
        execution of the agreement providing for such merger, consolidation or
        reorganization constitute at least a majority of the members of the board
        of
        directors of the Surviving Corporation, or a corporation Beneficially Owning,
        directly or indirectly, a majority of the voting securities of the Surviving
        Corporation, and

       

      (3)
        no
        Person, other
        than
        (i) the
        Company, (ii) any Related Entity (as defined in Section 2(p)), (iii) any
        employee benefit plan (or any trust forming a part thereof) that, immediately
        prior to such merger, consolidation or reorganization, was maintained by
        the
        Company, the Surviving Corporation, or any Related Entity or (iv) any Person
        who, together with its Affiliates, immediately prior to such merger,
        consolidation or reorganization had Beneficial Ownership of fifty percent
        (50%)
        or more of the then outstanding Voting Securities, owns, together with its
        Affiliates, Beneficial Ownership of fifty percent (50%) or more of the combined
        voting power of the Surviving Corporation’s then outstanding voting
        securities (a
        transaction described in clauses (1) through (3) above is referred to herein
        as
        a “Non-Control
        Transaction”);

       

      (B)
        a
        complete liquidation or dissolution of the Company; or 

       

      (C)
        an
        agreement for the sale or other disposition of all or substantially all of
        the
        assets or business of the Company to any Person (other than a transfer to
        a
        Related Entity or the distribution to the Company’s stockholders of the stock of
        a Related Entity or any other assets).

       

      Notwithstanding
        the foregoing, a Change in Control shall not be deemed to occur solely because
        any Person (the “Subject
        Person”)
        acquired Beneficial Ownership of fifty percent (50%) or more of the combined
        voting power of the then outstanding Voting Securities as a result of the
        acquisition of Voting Securities by the Company which, by reducing the number
        of
        Voting Securities then outstanding, increases the proportional number of
        shares
        Beneficially Owned by the Subject Persons, provided
        that if
        a Change in Control would occur (but for the operation of this sentence)
        as a
        result of the acquisition of Voting Securities by the Company, and (1) before
        such share acquisition by the Company the Subject Person becomes the Beneficial
        Owner of any new or additional Voting Securities in a related transaction
        or (2)
        after such share acquisition by the Company the Subject Person becomes the
        Beneficial Owner of any new or additional Voting Securities which in either
        case
        increases the percentage of the then outstanding Voting Securities Beneficially
        Owned by the Subject Person, then a Change in Control shall be deemed to
        occur.
        Solely for purposes of this Section 2(f), (x) “Affiliate” shall mean, with
        respect to any Person, any other Person that, directly or indirectly, controls,
        is controlled by, or is under common control with, such Person; (y) any
“Relative” (for this purpose, “Relative” means a spouse, child, parent, parent
        of spouse, sibling or grandchild) of an individual shall be deemed to be
        an
        Affiliate of such individual for this purpose; and (z) neither the Company
        nor
        any Person controlled by the Company shall be deemed to be an Affiliate of
        any
        holder of Common Stock.

      

      (g) “Code”
-
        the
        Internal Revenue Code of 1986, as it may be amended from time to time, including
        regulations and rules thereunder and successor provisions and regulations
        and
        rules thereto.

       

      (h) “Committee”
-
        the
        Compensation Committee of the Board, or such other Board committee as may
        be
        designated by the Board to administer the Plan.

       

      (i) “Company”
-
        EMCORE
        Corporation, a New Jersey corporation, or any successor entity.

       

      (j) “Disqualified
        Option”
-
        the
        meaning given such term in Section 10(d).

       

      (k) “Disqualifying
        Disposition”
-
        the
        meaning given such term in Section 10(d).

       

      (l) “Effective
        Date”
-
        the
        date on which the Plan is effective, as determined pursuant to Section
        15.

       

      (m) “Exchange
        Act”
-
        the
        Securities Exchange Act of 1934, as amended, and the rules and regulations
        promulgated thereunder.

       

      (n) “Fair
        Market Value”
-
        of a
        share of Stock as of a given date shall be: (i) if the Stock is listed or
        admitted to trading on an established stock exchange (including, for this
        purpose, the Nasdaq National Market), the mean of the highest and lowest
        sale
        prices for a share of Stock on the composite tape or in Nasdaq National Market
        trading as reported in The
        Wall Street Journal
        (or, if
        not so reported, such other nationally recognized reporting source as the
        Committee shall select) for such date, or, if no such prices are reported
        for
        such date, the most recent day for which such prices are available shall
        be
        used; (ii) if the Stock is not then listed or admitted to trading on such
        a
        stock exchange, the mean of the closing representative bid and asked prices
        for
        the Stock on such date as reported by the Nasdaq Small Cap Market or, if
        not so
        reported, by the OTC Bulletin Board (or any successor or similar quotation
        system regularly reporting the market value of the Stock in the over-the-counter
        market), or, if no such prices are reported for such date, the most recent
        day
        for which such prices are available shall be used; or (iii) in the event
        neither
        of the valuation methods provided for in clauses (i) and (ii) above are
        practicable, the fair market value of a share of Stock determined by such
        other
        reasonable valuation method as the Committee shall, in its discretion, select
        and apply in good faith as of the given date; provided,
        however,
        that
        for purposes of paragraphs (a) and (h) of Section 6, such fair market value
        shall be determined subject to Section 422(c)(7) of the Code. 

       

      (o) “ISO”
or
        “Incentive
        Stock Option”
-
        a
        right to purchase Stock granted to an Optionee under the Plan in accordance
        with
        the terms and conditions set forth in Section 6 and which conforms to the
        applicable provisions of Section 422 of the Code.

       

      (p) “Non-Control
        Acquisition”
-
        an
        acquisition by (i) an employee benefit plan (or a trust forming a part thereof)
        maintained by (A) the Company or (B) any corporation or other Person of which
        a
        majority of its voting power or its voting equity securities or equity interest
        is owned, directly or indirectly, by the Company (a “Related
        Entity”),
        (ii)
        the Company or any Related Entity, (iii) any of Thomas Russell, The AER Trust
        1997, Robert Louis-Dreyfus, Gallium Enterprises, Inc. and Reuben Richards
        or
        (iv) any Person in connection with a Non-Control Transaction.

       

      (q) “Notice”
-
        written notice actually received by the Company at its executive offices
        on the
        day of such receipt, if received on or before 1:30 p.m., on a day when the
        Company’s executive offices are open for business, or, if received after such
        time, such notice shall be deemed received on the next such day, which notice
        may be delivered in person to the Company’s Secretary or sent by facsimile to
        the Company at (732) 271-9686, or sent by certified or registered mail or
        overnight courier, prepaid, addressed to the Company at 394 Elizabeth Avenue,
        Somerset, New Jersey 08873, Attention: Secretary.

       

      (r) “Option”
-
        a
        right to purchase Stock granted to an Optionee under the Plan in accordance
        with
        the terms and conditions set forth in Section 6. Options may be either ISOs
        or
        stock options other than ISOs.

       

      (s) “Optionee”
-
        an
        individual who is eligible, pursuant to Section 5, and who has been selected,
        pursuant to Section 3(c), to participate in the Plan, and who holds an
        outstanding Option granted to such individual under the Plan in accordance
        with
        the terms and conditions set forth in Section 6.

       

      (t) “Person”
-
        “person” as such term is used for purposes of Section 13(d) or 14(d) of the
        Exchange Act, including, without limitation, any individual, corporation,
        limited liability company, partnership, trust, unincorporated organization,
        government or any agency or political subdivision thereof, or any other entity
        or any group of Persons.

       

      (u) “Plan”
-
        this
        EMCORE Corporation 2000 Stock Option Plan.

       

      (v) “Predecessor
        Plan”
-
        the
        Company’s 1995 Incentive and Non-Statutory Stock Option Plan.

       

      (w) “Securities
        Act”
-
        the
        Securities Act of 1933, as it may be amended from time to time, including
        the
        regulations and rules promulgated thereunder and successor provisions and
        regulations and rules thereto.

       

      (x) “Stock”
-
        the
        common stock of the Company, without par value.

       

      (y) “Subsidiary”
-
        any
        present or future corporation which is or would be a “subsidiary corporation” of
        the Company as the term is defined in Section 424(f) of the Code.

       

      (z) “Voting
        Securities”
-
        all
        the outstanding voting securities of the Company entitled to vote generally
        in
        the election of the Board.

       

      3. Administration
        of the Plan.
        (a)
        The
        Committee shall have exclusive authority to operate, manage and administer
        the
        Plan in accordance with its terms and conditions. Notwithstanding the foregoing,
        in its absolute discretion, the Board may at any time and from time to time
        exercise any and all rights, duties and responsibilities of the Committee
        under
        the Plan, including, but not limited to, establishing procedures to be followed
        by the Committee, but excluding matters which under any applicable law,
        regulation or rule, including, without limitation, any exemptive rule under
        Section 16 of the Exchange Act (including Rule 16b-3, or any successor rule,
        as
        the same may be amended from time to time) or Section 162(m) of the Code,
        are
        required to be determined in the sole discretion of the Committee. If and
        to the
        extent that no Committee exists which has the authority to administer the
        Plan,
        the functions of the Committee shall be exercised by the Board.

       

      (b) The
        Committee shall be appointed from time to time by the Board, and the Committee
        shall consist of not less than three members of the Board. Appointment of
        Committee members shall be effective upon their acceptance of such appointment.
        Committee members may be removed by the Board at any time either with or
        without
        cause, and such members may resign at any time by delivering notice thereof
        to
        the Board. Any vacancy on the Committee, whether due to action of the Board
        or
        any other reason, shall be filled by the Board.

       

      (c) The
        Committee shall have full authority to grant, pursuant to the terms of the
        Plan,
        Options to those individuals who are eligible to receive Options under the
        Plan.
        In particular, the Committee shall have discretionary authority, in accordance
        with the terms of the Plan, to: determine eligibility for participation in
        the
        Plan; select, from time to time, from among those eligible, the employees,
        directors and consultants to whom Options shall be granted under the Plan,
        which
        selection may be based upon information furnished to the Committee by the
        Company’s or an Affiliate’s management; determine whether an Option shall take
        the form of an ISO or an Option other than an ISO; determine the number of
        shares of Stock to be included in any Option and the periods for which Options
        will be outstanding; establish and administer any terms, conditions, performance
        criteria, restrictions, limitations, forfeiture, vesting or exercise schedule,
        and other provisions of or relating to any Option; grant waivers of terms,
        conditions, restrictions and limitations under the Plan or applicable to
        any
        Option, or accelerate the vesting or exercisability of any Option; amend
        or
        adjust the terms and conditions of any outstanding Option and/or adjust the
        number and/or class of shares of Stock subject to any outstanding Option;
        at any
        time and from time to time after the granting of an Option, specify such
        additional terms, conditions and restrictions with respect to any such Option
        as
        may be deemed necessary or appropriate to ensure compliance with any and
        all
        applicable laws or rules, including, but not limited to, terms, restrictions
        and
        conditions for compliance with applicable securities laws, regarding an
        Optionee’s exercise of Options by tendering shares of Stock or under any
“cashless exercise” program established by the Committee, and methods of
        withholding or providing for the payment of required taxes; and, to the extent
        permitted under the applicable Agreement, permit the transfer of an Option
        or
        the exercise of an Option by one other than the Optionee who received the
        grant
        of such Option (other than any such a transfer or exercise which would cause
        any
        ISO to fail to qualify as an “incentive stock option” under Section 422 of the
        Code). 

       

      (d) The
        Committee shall have all authority that may be necessary or helpful to enable
        it
        to discharge its responsibilities with respect to the Plan. Without limiting
        the
        generality of the foregoing sentence or Section 3(a), and in addition to
        the
        powers otherwise expressly designated to the Committee in the Plan, the
        Committee shall have the exclusive right and discretionary authority to
        interpret the Plan and the Agreements; construe any ambiguous provision of
        the
        Plan and/or the Agreements and decide all questions concerning eligibility
        for
        and the amount of Options granted under the Plan. The Committee may establish,
        amend, waive and/or rescind rules and regulations and administrative guidelines
        for carrying out the Plan and may correct any errors, supply any omissions
        or
        reconcile any inconsistencies in the Plan and/or any Agreement or any other
        instrument relating to any Options. The Committee shall have the authority
        to
        adopt such procedures and subplans and grant Options on such terms and
        conditions as the Committee determines necessary or appropriate to permit
        participation in the Plan by individuals otherwise eligible to so participate
        who are foreign nationals or employed outside of the United States, or otherwise
        to conform to applicable requirements or practices of jurisdictions outside
        of
        the United States; and take any and all such other actions it deems necessary
        or
        advisable for the proper operation and/or administration of the Plan. The
        Committee shall have full discretionary authority in all matters related
        to the
        discharge of its responsibilities and the exercise of its authority under
        the
        Plan. Decisions and actions by the Committee with respect to the Plan and
        any
        Agreement shall be final, conclusive and binding on all persons having or
        claiming to have any right or interest in or under the Plan and/or any
        Agreement. 

       

      (e) Each
        Option shall be evidenced by an Agreement, which shall be executed by the
        Company and the Optionee to whom such Option has been granted, unless the
        Agreement provides otherwise; two or more Options granted to a single Optionee
        may, however, be combined in a single Agreement. An Agreement shall not be
        a
        precondition to the granting of an Option; no person shall have any rights
        under
        any Option, however, unless and until the Optionee to whom the Option shall
        have
        been granted (i) shall have executed and delivered to the Company an Agreement
        or other instrument evidencing the Option, unless such Agreement provides
        otherwise, and (ii) has otherwise complied with the applicable terms and
        conditions of the Option. The Committee shall prescribe the form of all
        Agreements, and, subject to the terms and conditions of the Plan, shall
        determine the content of all Agreements. Any Agreement may be supplemented
        or
        amended in writing from time to time as approved by the Committee; provided
        that the
        terms and conditions of any such Agreement as supplemented or amended are
        not
        inconsistent with the provisions of the Plan. 

       

      (f) A
        majority of the members of the entire Committee shall constitute a quorum
        and
        the actions of a majority of the members of the Committee in attendance at
        a
        meeting at which a quorum is present, or actions by a written instrument
        signed
        by all members of the Committee, shall be the actions of the Committee.

       

      (g) The
        Committee may consult with counsel who may be counsel to the Company. The
        Committee may, with the approval of the Board, employ such other attorneys
        and/or consultants, accountants, appraisers, brokers and other persons as
        it
        deems necessary or appropriate. In accordance with Section 12, the Committee
        shall not incur any liability for any action taken in good faith in reliance
        upon the advice of such counsel or other persons.

       

      (h) In
        serving on the Committee, the members thereof shall be entitled to
        indemnification as directors of the Company, and to any limitation of liability
        and reimbursement as directors with respect to their services as members
        of the
        Committee.

       

      (i) Except
        to
        the extent prohibited by applicable law, including, without limitation, the
        requirements applicable under Section 162(m) of the Code to any Option intended
        to be “qualified performance-based compensation,” or the requirements for any
        Option granted to an officer or director to be covered by any exemptive rule
        under Section 16 of the Exchange Act (including Rule 16b-3, or any successor
        rule, as the same may be amended from time to time), or the applicable rules
        of
        a stock exchange, the Committee may, in its discretion, allocate all or any
        portion of its responsibilities and powers under this Section 3 to any one
        or
        more of its members and/or delegate all or any part of its responsibilities
        and
        powers under this Section 3 to any person or persons selected by it;
provided,
        however,
        that
        the Committee may not delegate its authority to correct errors, omissions
        or
        inconsistencies in the Plan. Any such authority delegated or allocated by
        the
        Committee under this paragraph (i) of Section 3 shall be exercised in accordance
        with the terms and conditions of the Plan and any rules, regulations or
        administrative guidelines that may from time to time be established by the
        Committee, and any such allocation or delegation may be revoked by the Committee
        at any time.

       

      4. Shares
        of Stock Subject to the Plan.
        (a)
        The
        shares of stock subject to Options granted under the Plan shall be shares
        of
        Stock. Such shares of Stock subject to the Plan may be either authorized
        and
        unissued shares (which will not be subject to preemptive rights) or previously
        issued shares acquired by the Company or any Subsidiary. The total number
        of
        shares of Stock that may be delivered pursuant to Options granted under the
        Plan
        is 9,350,000, plus any shares of Stock subject to a stock option granted
        under
        the Predecessor Plan which for any reason expires or is terminated or canceled
        without having been fully exercised by delivery of shares of Stock; provided,
        however,
        that
        the total number of shares of Stock that may be delivered pursuant to Incentive
        Stock Options under the Plan is 9,350,000, without application of paragraph
        (d)
        of this Section 4. 

       

      (b) Notwithstanding
        any of the foregoing limitations set forth in this Section 4, the numbers
        of
        shares of Stock specified in this Section 4 shall be adjusted as provided
        in
        Section 10.

       

      (c) Any
        shares of Stock subject to an Option which for any reason expires or is
        terminated or canceled without having been fully exercised by delivery of
        shares
        of Stock may again be granted pursuant to an Option under the Plan, subject
        to
        the limitations of this Section 4. 

       

      (d) If
        the
        option exercise price of an Option granted under the Plan or a stock option
        granted under the Predecessor Plan is paid by tendering to the Company shares
        of
        Stock already owned by the holder of such option (or such holder and his
        or her
        spouse jointly), only the number of shares of Stock issued net of the shares
        of
        Stock so tendered shall be deemed delivered for purposes of determining the
        total number of shares of Stock that may be delivered under the
        Plan.

       

      (e) Any
        shares of Stock delivered under the Plan in assumption or substitution of
        outstanding stock options, or obligations to grant future stock options,
        under
        plans or arrangements of an entity other than the Company or an Affiliate
        in
        connection with the Company or an Affiliate acquiring such another entity,
        or an
        interest in such an entity, or a transaction otherwise described in Section
        6(j), shall not reduce the maximum number of shares of Stock available for
        delivery under the Plan.

       

      5. Eligibility.
        Executive employees and other employees, including officers, of the Company
        and
        the Affiliates, directors (whether or not also employees), and consultants
        of
        the Company and the Affiliates, shall be eligible to become Optionees and
        receive Options in accordance with the terms and conditions of the Plan,
        subject
        to the limitations on the granting of ISOs set forth in Section 6(h).

       

      6. Terms
        and Conditions of Stock Options.
        All
        Options to purchase Stock granted under the Plan shall be either ISOs or
        Options
        other than ISOs. To the extent that any Option does not qualify as an Incentive
        Stock Option (whether because of its provisions or the time or manner of
        its
        exercise or otherwise), such Option, or the portion thereof which does not
        so
        qualify, shall constitute a separate Option other than an Incentive Stock
        Option. Each Option shall be subject to all the applicable provisions of
        the
        Plan, including the following terms and conditions, and to such other terms
        and
        conditions not inconsistent therewith as the Committee shall determine and
        which
        are set forth in the applicable Agreement. Options need not be uniform as
        to all
        grants and recipients thereof.

       

      (a) The
        option exercise price per share of shares of Stock subject to each Option
        shall
        be determined by the Committee and stated in the Agreement; provided,
        however,
        that,
        subject to paragraph (h)(iii) and/or (j) of this Section 6, if applicable,
        such
        price applicable to any ISO shall not be less than one hundred percent (100%)
        of
        the Fair Market Value of a share of Stock at the time that the Option is
        granted.

       

      (b) Each
        Option shall be exercisable in whole or in such installments, at such times
        and
        under such conditions as may be determined by the Committee, in its discretion
        in accordance with the Plan, and stated in the Agreement, and, in any event,
        over a period of time ending not later than ten (10) years from the date
        such
        Option was granted, subject to paragraph (h)(iii) of this Section
        6.

       

      (c) An
        Option
        shall not be exercisable with respect to a fractional share of Stock or the
        lesser of one hundred (100) shares and the full number of shares of Stock
        then
        subject to the Option. No fractional shares of Stock shall be issued upon
        the
        exercise of an Option. 

       

      (d) Each
        Option may be exercised by giving Notice to the Company specifying the number
        of
        shares of Stock to be purchased, which shall be accompanied by payment in
        full
        including applicable taxes, if any, in accordance with Section 9. Payment
        shall
        be in any manner permitted by applicable law and prescribed by the Committee,
        in
        its discretion, and set forth in the Agreement, including, in the Committee’s
        discretion, and subject to such terms, conditions and limitations as the
        Committee may prescribe, payment in accordance with a “cashless exercise”
arrangement established by the Committee and/or in Stock owned by the Optionee
        or by the Optionee and his or her spouse jointly and acquired more than six
        (6)
        months prior to such tender.

       

      (e) No
        Optionee or other person shall become the beneficial owner of any shares
        of
        Stock subject to an Option, nor have any rights to dividends or other rights
        of
        a shareholder with respect to any such shares until he or she has exercised
        his
        or her Option in accordance with the provisions of the Plan and the applicable
        Agreement.

       

      (f) An
        Option
        may be exercised only if at all times during the period beginning with the
        date
        of the granting of the Option and ending on the date of such exercise, the
        Optionee was an employee, director or consultant of the Company or an Affiliate,
        as applicable. Notwithstanding the preceding sentence, the Committee may
        determine in its discretion that an Option may be exercised prior to expiration
        of such Option following termination of such continuous employment, directorship
        or consultancy, whether or not exercisable at the time of such termination,
        to
        the extent provided in the applicable Agreement.

       

      (g) Subject
        to the terms and conditions and within the limitations of the Plan, the
        Committee may modify, extend or renew outstanding Options granted under the
        Plan, or accept the surrender of outstanding Options (up to the extent not
        theretofore exercised) and authorize the granting of new Options in substitution
        therefor (to the extent not theretofore exercised). 

       

      (h)
        (i) Each
        Agreement relating to an Option shall state whether such Option will or will
        not
        be treated as an ISO. No ISO shall be granted unless such Option, when granted,
        qualifies as an “incentive stock option” under Section 422 of the Code. No ISO
        shall be granted to any individual otherwise eligible to participate in the
        Plan
        who is not an employee of the Company or a Subsidiary on the date of granting
        of
        such Option. Any ISO granted under the Plan shall contain such terms and
        conditions, consistent with the Plan, as the Committee may determine to be
        necessary to qualify such Option as an “incentive stock option” under Section
        422 of the Code. Any ISO granted under the Plan may be modified by the Committee
        to disqualify such Option from treatment as an “incentive stock option” under
        Section 422 of the Code.

       

      (ii)
        Notwithstanding any intent to grant ISOs, an Option granted under the Plan
        will
        not be considered an ISO to the extent that it, together with any other
“incentive stock options” (within the meaning of Section 422 of the Code, but
        without regard to subsection (d) of such Section) under the Plan and any
        other
“incentive stock option” plans of the Company, any Subsidiary and any “parent
        corporation” of the Company within the meaning of Section 424(e) of the Code,
        are exercisable for the first time by any Optionee during any calendar year
        with
        respect to Stock having an aggregate Fair Market Value in excess of $100,000
        (or
        such other limit as may be required by the Code) as of the time the Option
        with
        respect to such Stock is granted. The rule set forth in the preceding sentence
        shall be applied by taking Options into account in the order in which they
        were
        granted. 

       

      (iii)
        No
        ISO shall be granted to an individual otherwise eligible to participate in
        the
        Plan who owns (within the meaning of Section 424(d) of the Code), at the
        time
        the Option is granted, more than ten percent (10%) of the total combined
        voting
        power of all classes of stock of the Company or a Subsidiary or any “parent
        corporation” of the Company within the meaning of Section 424(e) of the Code.
        This restriction does not apply if at the time such ISO is granted the Option
        exercise price per share of Stock subject to the Option is at least 110%
        of the
        Fair Market Value of a share of Stock on the date such ISO is granted, and
        the
        ISO by its terms is not exercisable after the expiration of five years from
        such
        date of grant.

       

      (i) An
        Option
        and any shares of Stock received upon the exercise of an Option shall be
        subject
        to such other transfer and/or ownership restrictions and/or legending
        requirements as the Committee may establish in its discretion and which are
        specified in the Agreement and may be referred to on the certificates evidencing
        such shares of Stock. The Committee may require an Optionee to give prompt
        Notice to the Company concerning any disposition of shares of Stock received
        upon the exercise of an ISO within: (i) two (2) years from the date of granting
        such ISO to such Optionee or (ii) one (1) year from the transfer of such
        shares
        of Stock to such Optionee or (iii) such other period as the Committee may
        from
        time to time determine. The Committee may direct that an Optionee with respect
        to an ISO undertake in the applicable Agreement to give such Notice described
        in
        the preceding sentence, at such time and containing such information as the
        Committee may prescribe, and/or that the certificates evidencing shares of
        Stock
        acquired by exercise of an ISO refer to such requirement to give such
        Notice.

       

      (j) In
        the
        event that a transaction described in Section 424(a) of the Code involving
        the
        Company or a Subsidiary is consummated, such as the acquisition of property
        or
        stock from an unrelated corporation, individuals who become eligible to
        participate in the Plan in connection with such transaction, as determined
        by
        the Committee, may be granted Options in substitution for stock options granted
        by another corporation that is a party to such transaction. If such substitute
        Options are granted, the Committee, in its discretion and consistent with
        Section 424(a) of the Code, if applicable, and the terms of the Plan, though
        notwithstanding paragraph (a) of this Section 6, shall determine the option
        exercise price and other terms and conditions of such substitute
        Options.

       

      (k) Notwithstanding
        any other provision contained in the Plan to the contrary, the maximum number
        of
        shares of Stock which may be subject to Options granted under the Plan to
        any
        Optionee in any twelve (12) month period shall not exceed the Award Limit.
        To
        the extent required by Section 162(m) of the Code, shares of Stock subject
        to
        Options which are canceled shall continue to be counted against the Award
        Limit
        and if, after the grant of an Option, the price of shares subject to such
        Option
        is reduced and the transaction is treated as a cancellation of the Option
        and a
        grant of a new Option, both the Option deemed to be canceled and the Option
        deemed to be granted shall be counted against the Award Limit.

       

      7. Transfer,
        Leave of Absence.
        A
        transfer of an employee from the Company to an Affiliate (or, for purposes
        of
        any ISO granted under the Plan, a Subsidiary), or vice versa, or from one
        Affiliate to another (or in the case of an ISO, from one Subsidiary to another),
        and a leave of absence, duly authorized in writing by the Company or a
        Subsidiary or Affiliate, shall not be deemed a termination of employment
        of the
        employee for purposes of the Plan or with respect to any Option (in the case
        of
        ISOs, to the extent permitted by the Code).

       

      8. Rights
        of Employees and Other Persons.
        (a)
        No
        person shall have any rights or claims under the Plan except in accordance
        with
        the provisions of the Plan and the applicable Agreement.

       

      (b) Nothing
        contained in the Plan or in any Agreement shall be deemed to (i) give any
        employee or director the right to be retained in the service of the Company
        or
        any Affiliate nor restrict in any way the right of the Company or any Affiliate
        to terminate any employee’s employment or any director’s directorship at any
        time with or without cause or (ii) confer on any consultant any right of
        continued relationship with the Company or any Affiliate, or alter any
        relationship between them, including any right of the Company or an Affiliate
        to
        terminate its relationship with such consultant.

       

      (c) The
        adoption of the Plan shall not be deemed to give any employee of the Company
        or
        any Affiliate or any other person any right to be selected to participate
        in the
        Plan or to be granted an Option.

       

      (d) Nothing
        contained in the Plan or in any Agreement shall be deemed to give any employee
        the right to receive any bonus, whether payable in cash or in Stock, or in
        any
        combination thereof, from the Company or any Affiliate, nor be construed
        as
        limiting in any way the right of the Company or any Affiliate to determine,
        in
        its sole discretion, whether or not it shall pay any employee bonuses, and,
        if
        so paid, the amount thereof and the manner of such payment.

       

      9. Tax
        Withholding Obligations.
        (a)
        The
        Company and/or any Affiliate are authorized to take whatever actions are
        necessary and proper to satisfy all obligations of Optionees (including,
        for
        purposes of this Section 9, any other person entitled to exercise an Option
        pursuant to the Plan or an Agreement) for the payment of all Federal, state,
        local and foreign taxes in connection with any Options (including, but not
        limited to, actions pursuant to the following paragraph (b) of this Section
        9).

       

      (b) Each
        Optionee shall (and in no event shall Stock be delivered to such Optionee
        with
        respect to an Option until), no later than the date as of which the value
        of the
        Option first becomes includible in the gross income of the Optionee for income
        tax purposes, pay to the Company in cash, or make arrangements satisfactory
        to
        the Company, as determined in the Committee’s discretion, regarding payment to
        the Company of, any taxes of any kind required by law to be withheld with
        respect to the Stock or other property subject to such Option, and the Company
        and any Affiliate shall, to the extent permitted by law, have the right to
        deduct any such taxes from any payment of any kind otherwise due to such
        Optionee. Notwithstanding the above, the Committee may, in its discretion
        and
        pursuant to procedures approved by the Committee, permit the Optionee to
        (i)
        elect withholding by the Company of Stock otherwise deliverable to such Optionee
        pursuant to his or her Option (provided,
        however,
        that
        the amount of any Stock so withheld shall not exceed the amount necessary
        to
        satisfy required Federal, state, local and foreign withholding obligations
        using
        the minimum statutory rate) and/or (ii) tender to the Company Stock owned
        by
        such Optionee (or by such Optionee and his or her spouse jointly) and acquired
        more than six (6) months prior to such tender in full or partial satisfaction
        of
        such tax obligations, based, in each case, on the Fair Market Value of the
        Stock
        on the payment date as determined by the Committee.

       

      10. Changes
        in Capital.
        (a)
        The
        existence of the Plan and any Options granted hereunder shall not affect
        in any
        way the right or power of the Board or the stockholders of the Company to
        make
        or authorize any adjustment, recapitalization, reorganization or other change
        in
        the Company’s capital structure or its business, any merger or consolidation of
        the Company or an Affiliate, any issue of debt, preferred or prior preference
        stock ahead of or affecting Stock, the authorization or issuance of additional
        shares of Stock, the dissolution or liquidation of the Company or its
        Affiliates, any sale or transfer of all or part of its assets or business
        or any
        other corporate act or proceeding.

       

      (b)(i)
        Upon
        changes in the outstanding Stock by reason of a stock dividend, stock split,
        reverse stock split, subdivision, recapitalization, reclassification, merger,
        consolidation (whether or not the Company is a surviving corporation),
        combination or exchange of shares of Stock, separation, or reorganization,
        or in
        the event of an extraordinary dividend, “spin-off,” liquidation, other
        substantial distribution of assets of the Company or acquisition of property
        or
        stock or other change in capital of the Company, or the issuance by the Company
        of shares of its capital stock without receipt of full consideration therefor,
        or rights or securities exercisable, convertible or exchangeable for shares
        of
        such capital stock, or any similar change affecting the Company’s capital
        structure, the aggregate number, class and kind of shares of stock available
        under the Plan as to which Options may be granted, the Award Limit, and the
        number, class and kind of shares under each outstanding Option and the exercise
        price per share applicable to any such Options shall be appropriately adjusted
        by the Committee in its discretion to preserve the benefits or potential
        benefits intended to be made available under the Plan or with respect to
        any
        outstanding Options or otherwise necessary to reflect any such change.

       

      (ii) Fractional
        shares of Stock resulting from any adjustment in Options pursuant to Section
        10(b)(i) shall be aggregated until, and eliminated at, the time of exercise
        of
        the affected Options. Notice of any adjustment shall be given by the Committee
        to each Optionee whose Option has been adjusted and such adjustment (whether
        or
        not such Notice is given) shall be effective and binding for all purposes
        of the
        Plan.

       

      (c) In
        the
        event of a Change in Control:

       

      (i) Immediately
        prior thereto, all outstanding Options shall be accelerated and become
        immediately exercisable as to all of the shares of Stock covered thereby,
        notwithstanding anything to the contrary in the Plan or the
        Agreement.

       

      (ii) In
        its
        discretion, and on such terms and conditions as it deems appropriate, the
        Committee may provide, either by the terms of the Agreement applicable to
        any
        Option or by resolution adopted prior to the occurrence of the Change in
        Control, that any outstanding Option shall be adjusted by substituting for
        Stock
        subject to such Option stock or other securities of the surviving corporation
        or
        any successor corporation to the Company, or a parent or subsidiary thereof,
        or
        that may be issuable by another corporation that is a party to the transaction
        resulting in the Change in Control, whether or not such stock or other
        securities are publicly traded, in which event the aggregate exercise price
        shall remain the same and the amount of shares or other securities subject
        to
        the Option shall be the amount of shares or other securities which could
        have
        been purchased on the closing date or expiration date of such transaction
        with
        the proceeds which would have been received by the Optionee if the Option
        had
        been exercised in full (or with respect to a portion of such Option, as
        determined by the Committee, in its discretion) prior to such transaction
        or
        expiration date and the Optionee exchanged all of such shares in the
        transaction.

       

      (iii) In
        its
        discretion, and on such terms and conditions as it deems appropriate, the
        Committee may provide, either by the terms of the Agreement applicable to
        any
        Option or by resolution adopted prior to the occurrence of the Change in
        Control, that any outstanding Option shall be converted into a right to receive
        cash on or following the closing date or expiration date of the transaction
        resulting in the Change in Control in an amount equal to the highest value
        of
        the consideration to be received in connection with such transaction for
        one
        share of Stock, or, if higher, the highest Fair Market Value of the Stock
        during
        the thirty (30) consecutive business days immediately prior to the closing
        date
        or expiration date of such transaction, less the per share exercise price
        of
        such Option, multiplied by the number of shares of Stock subject to such
        Option,
        or a portion thereof.

       

      (iv) The
        Committee may, in its discretion, provide that an Option cannot be exercised
        after such a Change in Control, to the extent that such Option is or becomes
        fully exercisable on or before such Change in Control or is subject to any
        acceleration, adjustment or conversion in accordance with the foregoing
        paragraphs (i), (ii) or (iii) of this Section 10.

       

      No
        Optionee shall have any right to prevent the consummation of any of the
        foregoing acts affecting the number of shares of Stock available to such
        Optionee. Any actions or determinations of the Committee under this subsection
        10(c) need not be uniform as to all outstanding Options, nor treat all Optionees
        identically. Notwithstanding the foregoing adjustments, in no event may any
        Option be exercised after ten (10) years from the date it was originally
        granted, and any changes to ISOs pursuant to this Section 10 shall, unless
        the
        Committee determines otherwise, only be effective to the extent such adjustments
        or changes do not cause a “modification” (within the meaning of Section
        424(h)(3) of the Code) of such ISOs or adversely affect the tax status of
        such
        ISOs.

       

      (d) If,
        as a
        result of a Change in Control transaction, an ISO fails to qualify as an
        “incentive stock option,” within the meaning of Section 422 of the Code, either
        because of the failure of the Optionee to meet the holding period requirements
        of Code Section 422(a)(1) (a “Disqualifying Disposition”) or the exercisability
        of such Option is accelerated pursuant to Section 10(c)(i), or any similar
        provision of the applicable Agreement, in connection with such Change in
        Control
        and such acceleration causes the aggregate Fair Market Value (determined
        at the
        time the Option is granted) of the shares of Stock with respect to which
        such
        Option, together with any other “incentive stock options,” as provided in
        Section 6(h)(ii), are exercisable for the first time by such Optionee during
        the
        calendar year in which such accelerated exercisability occurs to exceed the
        limitations set forth in Section 6(h)(ii) (a “Disqualified Option”); or any
        other exercise, payment, acceleration, adjustment or conversion of an Option
        in
        connection with a Change in Control transaction results in any additional
        taxes
        imposed on an Optionee, then the Company may, in the discretion of the
        Committee, make a cash payment to or on behalf of the Optionee who holds
        any
        such Option equal to the amount that will, after taking into account all
        taxes
        imposed on the Disqualifying Disposition or other exercise, payment,
        acceleration, adjustment or conversion of the Option, as the case may be,
        and
        the receipt of such payment, leave such Optionee in the same after-tax position
        the Optionee would have been in had the Code Section 422(a)(1) holding period
        requirements been met at the time of the Disqualifying Disposition or had
        the
        Disqualified Option continued to qualify as an “incentive stock option,” within
        the meaning of Code Section 422 on the date of such exercise or otherwise
        equalize the Optionee for any such taxes; provided,
        however,
        that
        the amount, timing and recipients of any such payment or payments shall be
        subject to such terms, conditions and limitations as the Committee shall,
        in its
        discretion, determine. Without limiting the generality of the proviso
        contained in the immediately preceding sentence, in determining the amount
        of
        any such payment or payments referred to therein, the Committee may adopt
        such
        methods and assumptions as it considers appropriate, and the Committee shall
        not
        be required to examine or take into account the individual tax liability
        of any
        Optionee.

       

      11. Prohibition
        on Repricing and Reload Grants.
        Other
        than in connection with a change in the Company’s capitalization (e.g., stock
        splits, recapitalizations, etc., as described in Section 10 of the Plan),
        without stockholder approval (i) the exercise price of an Option may not
        be
        reduced, (ii) no Option may be amended or cancelled for the purpose of
        repricing, replacing or regranting such Option with an exercise price that
        is
        less than the original exercise price of such Option, and (iii) the Committee
        shall not offer
        to
        buy out an Option previously granted for cash or other consideration.

       

      12. Miscellaneous
        Provisions.
        (a)
        The Plan
        shall be unfunded. The Company shall not be required to establish any special
        or
        separate fund or to make any other segregation of assets to assure the issuance
        of shares of Stock or the payment of cash upon exercise or payment of any
        Option. Proceeds from the sale of shares of Stock pursuant to Options granted
        under the Plan shall constitute general funds of the Company. 

       

      (b) Except
        as
        otherwise provided in this paragraph (b) of Section 12 or by the Committee,
        an
        Option by its terms shall be personal and may not be sold, transferred, pledged,
        assigned, encumbered or otherwise alienated or hypothecated otherwise than
        by
        will or by the laws of descent and distribution and shall be exercisable
        during
        the lifetime of an Optionee only by him or her. An Agreement may permit the
        exercise or payment of an Optionee’s Option (or any portion thereof) after his
        or her death by or to the beneficiary most recently named by such Optionee
        in a
        written designation thereof filed with the Company, or, in lieu of any such
        surviving beneficiary, as designated by the Optionee by will or by the laws
        of
        descent and distribution. In the event any Option is exercised by the executors,
        administrators, heirs or distributees of the estate of a deceased Optionee,
        or
        such an Optionee’s beneficiary, or the transferee of an Option, in any such case
        pursuant to the terms and conditions of the Plan and the applicable Agreement
        and in accordance with such terms and conditions as may be specified from
        time
        to time by the Committee, the Company shall be under no obligation to issue
        Stock thereunder unless and until the Committee is satisfied that the person
        or
        persons exercising such Option is the duly appointed legal representative
        of the
        deceased Optionee’s estate or the proper legatee or distributee thereof or the
        named beneficiary of such Optionee, or the valid transferee of such Option,
        as
        applicable.

       

      (c) (i)
        If at
        any time the Committee shall determine, in its discretion, that the listing,
        registration and/or qualification of shares of Stock upon any securities
        exchange or under any state, Federal or foreign law, or the consent or approval
        of any governmental regulatory body, is necessary or desirable as a condition
        of, or in connection with, the sale or purchase of shares of Stock hereunder,
        no
        Option may be granted, exercised or paid in whole or in part unless and until
        such listing, registration, qualification, consent and/or approval shall
        have
        been effected or obtained, or otherwise provided for, free of any conditions
        not
        acceptable to the Committee.

       

      (ii) If
        at any
        time counsel to the Company shall be of the opinion that any sale or delivery
        of
        shares of Stock pursuant to an Option is or may be in the circumstances unlawful
        or result in the imposition of excise taxes on the Company or any Affiliate
        under the statutes, rules or regulations of any applicable jurisdiction,
        the
        Company shall have no obligation to make such sale or delivery, or to make
        any
        application or to effect or to maintain any qualification or registration
        under
        the Securities Act, or otherwise with respect to shares of Stock or Options
        and
        the right to exercise any Option shall be suspended until, in the opinion
        of
        such counsel, such sale or delivery shall be lawful or will not result in
        the
        imposition of excise taxes on the Company or any Affiliate. 

       

      (iii) Upon
        termination of any period of suspension under this Section 12(c), any Option
        affected by such suspension which shall not then have expired or terminated
        shall be reinstated as to all shares available before such suspension and
        as to
        the shares which would otherwise have become available during the period
        of such
        suspension, but no suspension shall extend the term of any Option.

       

      (d) The
        Committee may require each person receiving Stock in connection with any
        Option
        under the Plan to represent and agree with the Company in writing that such
        person is acquiring the shares of Stock for investment without a view to
        the
        distribution thereof. The Committee, in its absolute discretion, may impose
        such
        restrictions on the ownership and transferability of the shares of Stock
        purchasable or otherwise receivable by any person under any Option as it
        deems
        appropriate. Any such restrictions shall be set forth in the applicable
        Agreement, and the certificates evidencing such shares may include any legend
        that the Committee deems appropriate to reflect any such
        restrictions.

       

      (e) By
        accepting any benefit under the Plan, each Optionee and each person claiming
        under or through such Optionee shall be conclusively deemed to have indicated
        their acceptance and ratification of, and consent to, all of the terms and
        conditions of the Plan and any action taken under the Plan by the Committee,
        the
        Company or the Board, in any case in accordance with the terms and conditions
        of
        the Plan.

       

      (f) In
        the
        discretion of the Committee, an Optionee may elect irrevocably (at a time
        and in
        a manner determined by the Committee) prior to exercising an Option that
        delivery of shares of Stock upon such exercise shall be deferred until a
        future
        date and/or the occurrence of a future event or events, specified in such
        election. Upon the exercise of any such Option and until the delivery of
        any
        deferred shares, the number of shares otherwise issuable to the Optionee
        shall
        be credited to a memorandum account in the records of the Company or its
        designee and any dividends or other distributions payable on such shares
        shall
        be deemed reinvested in additional shares of Stock, in a manner determined
        by
        the Committee, until all shares of Stock credited to such Optionee’s memorandum
        account shall become issuable pursuant to the Optionee’s election.

       

      (g) The
        Committee may, in its discretion, extend one or more loans to Optionees who
        are
        directors, key employees or consultants of the Company or an Affiliate in
        connection with the exercise or receipt of an Option granted to any such
        individual. The terms and conditions of any such loan shall be established
        by
        the Committee.

       

      (h) Except
        with respect to Incentive Stock Options granted under the Predecessor Plan
        (within the meaning of the Predecessor Plan) and outstanding on the Effective
        Date, subject to approval of the Plan by the Company’s shareholders, in
        accordance with Section 15, the provisions of the Plan shall apply to and
        govern
        all stock options granted under the Predecessor Plan and, unless otherwise
        determined by the Committee, such stock options granted under the Predecessor
        Plan shall be deemed to be amended to provide any additional rights applicable
        to Options hereunder, subject to the right of any affected participant in
        the
        Predecessor Plan to refuse to consent to such amendment pursuant to the terms
        and conditions of the Predecessor Plan and the applicable option or award
        agreement between the Company and such participant. 

       

      (i) Neither
        the adoption of the Plan nor anything contained herein shall affect any other
        compensation or incentive plans or arrangements of the Company or any Affiliate
        (other than the Predecessor Plan, as provided in paragraph (h) of this Section
        12), or prevent or limit the right of the Company or any Affiliate to establish
        any other forms of incentives or compensation for their directors, employees
        or
        consultants or grant or assume options or other rights otherwise than under
        the
        Plan.

       

      (j) The
        Plan
        shall be governed by and construed in accordance with the laws of the State
        of
        New Jersey, without regard to such state’s conflict of law provisions, and, in
        any event, except as superseded by applicable Federal law.

       

      (k) The
        words
“Section,” “subsection” and “paragraph” herein shall refer to provisions of the
        Plan, unless expressly indicated otherwise. Wherever any words are used in
        the
        Plan or any Agreement in the masculine gender they shall be construed as
        though
        they were also used in the feminine gender in all cases where they would
        so
        apply, and wherever any words are used herein in the singular form they shall
        be
        construed as though they were also used in the plural form in all cases where
        they would so apply.

       

      (l) The
        Company shall bear all costs and expenses incurred in administering the Plan,
        including expenses of issuing Stock pursuant to any Options granted
        hereunder.

       

      13. Limits
        of Liability.
        (a)
        Any
        liability of the Company or an Affiliate to any Optionee with respect to
        any
        Option shall be based solely upon contractual obligations created by the
        Plan
        and the Agreement.

       

      (b) None
        of
        the Company, any Affiliate, any member of the Committee or the Board or any
        other person participating in any determination of any question under the
        Plan,
        or in the interpretation, administration or application of the Plan, shall
        have
        any liability, in the absence of bad faith, to any party for any action taken
        or
        not taken in connection with the Plan, except as may expressly be provided
        by
        statute.

       

      14. Limitations
        Applicable to Certain Options Subject to Exchange Act Section 16 and Code
        Section 162(m).
        Unless
        stated otherwise in the Agreement, notwithstanding any other provision of
        the
        Plan, any Option granted to an officer or director of the Company who is
        then
        subject to Section 16 of the Exchange Act, shall be subject to any additional
        limitations set forth in any applicable exemptive rule under Section 16 of
        the
        Exchange Act (including Rule 16b-3, or any successor rule, as the same may
        be
        amended from time to time) that are requirements for the application of such
        exemptive rule, and the Plan and applicable Agreement shall be deemed amended
        to
        the extent necessary to conform to such limitations. Furthermore, unless
        stated
        otherwise in the Agreement, notwithstanding any other provision of the Plan,
        any
        Option granted to an employee of the Company or an Affiliate intended to
        qualify
        as “other performance-based compensation” as described in Section 162(m)(4)(C)
        of the Code shall be subject to any additional limitations set forth in Section
        162(m) of the Code or any regulations or rulings issued thereunder (including
        any amendment to any of the foregoing) that are requirements for qualification
        as “other performance-based compensation” as described in Section 162(m)(4)(C)
        of the Code, and the Plan and applicable Agreement shall be deemed amended
        to
        the extent necessary to conform to such requirements.

       

      15. Amendments
        and Termination.
        The
        Board may, at any time and with or without prior notice, amend, alter, suspend
        or terminate the Plan, retroactively or otherwise; provided,
        however,
        unless
        otherwise required by law or specifically provided herein, no such amendment,
        alteration, suspension or termination shall be made which would impair the
        previously accrued rights of any holder of an Option theretofore granted
        without
        his or her written consent, or which, without first obtaining approval of
        the
        stockholders of the Company (where such approval is necessary to satisfy
        (i) any
        applicable requirements under the Code relating to ISOs or for exemption
        from
        Section 162(m) of the Code; (ii) the then-applicable requirements of Rule
        16b-3
        promulgated under the Exchange Act, or any successor rule, as the same may
        be
        amended from time to time; or (iii) any other applicable law, regulation
        or
        rule), would:

       

      
        	 	
                (a)

              	
                except
                  as is provided in Section 10, increase the maximum number of shares
                  of
                  Stock which may be sold or awarded under the Plan or increase the
                  limitations set forth in Section 6(k) on the maximum of shares
                  of Stock
                  that may be subject to Options granted to an
                  Optionee;

              

      

       

      
        	 	
                (b)

              	
                except
                  as is provided in Section 10, decrease the minimum option exercise
                  price
                  requirements of Section 6(a);

              

      

       

      
        	 	
                (c)

              	
                change
                  the class of persons eligible to receive Options under the Plan;
                  

              

      

       

      
        	 	
                (d)

              	
                extend
                  the duration of the Plan or the period during which Options may
                  be
                  exercised under Section 6(b); or

              

      

       

      
        	 	
                (e)

              	
                other
                  than in connection with a change in the Company’s capitalization (e.g.,
                  stock splits, recapitalizations, etc., as described in Section
                  10 of the
                  Plan), (i) reduce the exercise price of an Option, (ii) amend or
                  cancel
                  any Option for the purpose of repricing, replacing or regranting
                  such
                  Option with an exercise price that is less than the original exercise
                  price of such Option or (iii) permit the Committee to
                  buy out an Option previously granted for cash or other
                  consideration.

              

      

       

      The
        Committee may amend the terms of any Option theretofore granted, including
        any
        Agreement, retroactively or prospectively, but no such amendment shall
        materially impair the previously accrued rights of any Optionee without his
        or
        her written consent.

       

      16. Duration.
        Following the adoption of the Plan by the Board, the Plan shall become effective
        as of the date on which it is approved by the holders of a majority of the
        Company's outstanding Stock which is present and voted at a meeting, or by
        written consent in lieu of a meeting (the “Effective Date”), which approval must
        occur within the period ending twelve (12) months after the date the Plan
        is
        adopted by the Board. The Plan shall terminate upon the earliest to occur
        of:

       

      
        	 	
                (a)

              	
                the
                  effective date of a resolution adopted by the Board terminating
                  the
                  Plan;

              

      

       

      
        	 	
                (b)

              	
                the
                  date all shares of Stock subject to the Plan are delivered pursuant
                  to the
                  Plan's provisions; or

              

      

       

      
        	 	
                (c)

              	
                ten
                  (10) years from the Effective Date.

              

      

       

      No
        Option
        may be granted under the Plan after the earliest to occur of the events or
        dates
        described in the foregoing paragraphs (a) through (c) of this Section 15;
        however,
        Options
        theretofore granted may extend beyond such date.

       

      No
        such
        termination of the Plan shall affect the previously accrued rights of any
        Optionee hereunder and all Options previously granted hereunder shall continue
        in force and in operation after the termination of the Plan, except as they
        may
        be otherwise terminated in accordance with the terms of the Plan or the
        Agreement.EMCORE CORP. 8-K EX-10.2 -- 2000 EMPLOYEE STOCK PURCHASE PLAN - REVISED 2/13/06

    
      
        

      

    

    Exhibit
      10.2

     

    EMCORE
      CORPORATION

    
       

      AMENDED
        AND RESTATED 2000 EMPLOYEE STOCK PURCHASE PLAN

      Revised
        February 13, 2006

       

      ARTICLE
        I

       

      ESTABLISHMENT

       

      Purpose

       

      The
        EMCORE
        Corporation 2000 Employee Stock Purchase Plan (the “Plan”) is hereby established
        by EMCORE
        Corporation (the “Company”), the purpose of which is to provide a method whereby
        employees of the Company or any Designated Subsidiary (as defined herein),
        will
        have an opportunity to acquire a proprietary interest in the Company through
        the
        purchase of shares of Common Stock. The Plan is also established to help
        promote
        the overall financial objectives of the Company’s stockholders by promoting
        those persons participating in the Plan to achieve long-term growth in
        stockholder equity. The Plan is intended to qualify as an “employee stock
        purchase plan” under Section 423 of the Internal Revenue Code of 1986, as
        amended (the “Code”). The provisions of the Plan shall be construed so as to
        extend and limit participation in a manner consistent with the requirements
        of
        Section 423 of the Code and the regulations promulgated thereunder.

       

       

      ARTICLE
        II

       

      DEFINITIONS

       

      The
        following words and phrases, as used herein, shall have the meanings indicated
        unless the context clearly indicates to the contrary:

      

      2.01 Account
        shall
        mean the bookkeeping account established on behalf of a Participant to which
        is
        credited all contributions paid for the purpose of purchasing Common Stock
        under
        the Plan, and to which shall be charged all purchases of Common Stock, or
        withdrawals, pursuant to the Plan. Such Account shall remain unfunded as
        described in Section 8.11 of the Plan.

      

      2.02  Affiliate
        shall
        mean, with respect to any Person, any other Person that, directly or indirectly,
        controls, is controlled by, or is under common control with, such Person.
        Any
“Relative” (for this purpose, “Relative” means a spouse, child, parent, parent
        of spouse, sibling or grandchild) of an individual shall be deemed to be
        an
        Affiliate of such individual for this purpose. Neither the Company nor any
        Person controlled by the Company shall be deemed to be an Affiliate of any
        holder of Common Stock.

      

      2.03 Agreement
        shall
        mean, either individually or collectively, any subscription, enrollment and/or
        withholding agreement, in the form prescribed by the Committee, entered into
        pursuant to the Plan between the Company or a Designated Subsidiary and a
        Participant. Such Agreement shall be an authorization for the Company or
        a
        Designated Subsidiary to withhold amounts from such Participant’s Compensation,
        at the Contribution Rate specified in the Agreement, to be applied to purchase
        Common Stock.

      

      2.04
         Beneficial
        Ownership
        (including correlative terms) shall have the meaning given such term in Rule
        13d-3 promulgated under the Exchange Act.

       

      2.05 Beneficiary
        shall
        mean the person specified by a Participant in his or her most recent written
        designation that is filed with the Committee to receive any benefits under
        the
        Plan in the event of such Participant’s death, in accordance with Section
        8.01.

       

      2.06 Board
        shall
        mean the Board of Directors of the Company.

       

      2.07 Change
        in Control
        shall
        mean the occurrence of any of the following:

       

      (a)
        an
        acquisition in one transaction or a series of related transactions (other
        than
        directly from the Company or pursuant to awards granted under the Plan or
        compensatory options or other similar awards granted by the Company) of any
        Voting Securities by any Person, immediately after which such Person has
        Beneficial Ownership of fifty percent (50%) or more of the combined voting
        power
        of the Company’s then outstanding Voting Securities; provided,
        however,
        in
        determining whether a Change in Control has occurred pursuant to this Section
        2.07(a), Voting Securities which are acquired in a Non-Control Acquisition
        shall
        not constitute an acquisition that would cause a Change in Control;

       

      (b)
        the
        individuals who, immediately prior to the Effective Date, are members of
        the
        Board (the “Incumbent
        Board”),
        cease
        for any reason to constitute at least a majority of the members of the Board;
        provided,
        however,
        that if
        the election, or nomination for election, by the Company’s common stockholders,
        of any new director was approved by a vote of at least a majority of the
        Incumbent Board, such new director shall, for purposes of the Plan, be
        considered as a member of the Incumbent Board; provided
        further,
        however,
        that no
        individual shall be considered a member of the Incumbent Board if such
        individual initially assumed office as a result of either an actual or
        threatened “Election Contest” (as described in Rule 14a-11 promulgated under the
        Exchange Act) or other actual or threatened solicitation of proxies or consents
        by or on behalf of a Person other than the Board (a “Proxy
        Contest”)
        including by reason of any agreement intended to avoid or settle any Election
        Contest or Proxy Contest; or

       

      (c)
        the
        consummation of:

       

      (1)
        a
        merger, consolidation or reorganization involving the Company
        unless:

       

      (A)
        the
        stockholders of the Company, immediately before such merger, consolidation
        or
        reorganization, own, directly or indirectly, immediately following such merger,
        consolidation or reorganization, more than fifty percent (50%) of the combined
        voting power of the outstanding voting securities of the corporation resulting
        from such merger or consolidation or reorganization (the “Surviving
        Corporation”)
        in
        substantially the same proportion as their ownership of the Voting Securities
        immediately before such merger, consolidation or reorganization,

       

      (B)
        the
        individuals who were members of the Incumbent Board immediately prior to
        the
        execution of the agreement providing for such merger, consolidation or
        reorganization constitute at least a majority of the members of the board
        of
        directors of the Surviving Corporation, or a corporation Beneficially Owning,
        directly or indirectly, a majority of the voting securities of the Surviving
        Corporation, and

       

      (C)
        no
        Person, other
        than
        (i) the
        Company, (ii) any Related Entity (as defined in Section 2.20), (iii) any
        employee benefit plan (or any trust forming a part thereof) that, immediately
        prior to such merger, consolidation or reorganization, was maintained by
        the
        Company, the Surviving Corporation, or any Related Entity or (iv) any Person
        who, together with its Affiliates, immediately prior to such merger,
        consolidation or reorganization had Beneficial Ownership of fifty percent
        (50%)
        or more of the then outstanding Voting Securities, owns, together with its
        Affiliates, Beneficial Ownership of fifty percent (50%) or more of the combined
        voting power of the Surviving Corporation’s then outstanding voting securities

       

      (a
        transaction described in clauses (A) through (C) above is referred to herein
        as
        a “Non-Control
        Transaction”);

       

      (2)
        a
        complete liquidation or dissolution of the Company; or 

       

      (3)
        an
        agreement for the sale or other disposition of all or substantially all of
        the
        assets or business of the Company to any Person (other than a transfer to
        a
        Related Entity or the distribution to the Company’s stockholders of the stock of
        a Related Entity or any other assets).

       

      Notwithstanding
        the foregoing, a Change in Control shall not be deemed to occur solely because
        any Person (the “Subject
        Person”)
        acquired Beneficial Ownership of fifty percent (50%) or more of the combined
        voting power of the then outstanding Voting Securities as a result of the
        acquisition of Voting Securities by the Company which, by reducing the number
        of
        Voting Securities then outstanding, increases the proportional number of
        shares
        Beneficially Owned by the Subject Persons, provided
        that if
        a Change in Control would occur (but for the operation of this sentence)
        as a
        result of the acquisition of Voting Securities by the Company, and (1) before
        such share acquisition by the Company the Subject Person becomes the Beneficial
        Owner of any new or additional Voting Securities in a related transaction
        or (2)
        after such share acquisition by the Company the Subject Person becomes the
        Beneficial Owner of any new or additional Voting Securities which in either
        case
        increases the percentage of the then outstanding Voting Securities Beneficially
        Owned by the Subject Person, then a Change in Control shall be deemed to
        occur.

       

      2.08 Commission
        shall
        mean the Securities and Exchange Commission or any successor entity or agency.
        

       

      2.09 Committee
        shall
        mean the Plan Committee of the Board as described in Article VII. 

       

      2.10 Compensation
        shall
        mean, for the relevant period, (a) the total compensation paid in cash to
        a
        Participant by the Company and/or a Designated Subsidiary, including salaries,
        wages, commissions, overtime pay, shift premiums, bonuses, and incentive
        compensation, plus (b) any pre-tax contributions made by a Participant under
        Section 401(k) or 125 of the Code. Compensation
        shall
        exclude non-cash items, moving or relocation allowances, geographic hardship
        pay, car allowances, tuition reimbursements, imputed income attributable
        to cars
        or life insurance, severance or notice pay, fringe benefits, contributions
        (except as provided in clause (b) of the immediately preceding sentence)
        or
        benefits received under employee benefit or deferred compensation plans or
        arrangements, income attributable to stock options and similar
        items.

       

      2.11 Common
        Stock
        shall
        mean shares of common stock of the Company, without par value, or the common
        stock of any successor to the Company, which is designated for the purposes
        of
        the Plan.

       

      2.12 Contribution
        Rate
        shall be
        that rate of contribution of Compensation to the Plan stated in the Agreement,
        subject to determination in accordance with Article IV.

       

      2.13 Designated
        Subsidiary shall
        mean any Subsidiary that has been designated by the Board from time to time
        in
        its sole discretion as eligible to participate in the Plan.

       

      2.14 Effective
        Date
        shall
        mean April 1, 2000.

       

      2.15 Eligible
        Employee
        shall
        mean any individual who is employed on a full-time or part-time basis by
        the
        Company or a Designated Subsidiary on an Enrollment Date, except that the
        Committee in its sole discretion may exclude:

       

      (i)
employees
        whose customary employment is not more than 20 hours per
        week;

       

      (ii)
employees
        whose customary employment is for not more than five months in any calendar
        year; and

       

      (iii)
        employees who are considered to be a highly compensated employee of the Company
        or Designated Subsidiary within the meaning of Section 414(q) of the Code.
        

       

      As
        of the
        Effective Date, and unless and until the Committee determines otherwise,
        only
        those employees described in Section 2.15(i) and (ii) are excluded from the
        class of Eligible Employees. 

       

      2.16 Enrollment
        Date
        shall
        mean the first day of each Offering Period.

       

      2.17 Exchange
        Act
        means
        the Securities Exchange Act of 1934, as amended, and the rules and regulations
        promulgated by the Commission thereunder.

       

      2.18 Exercise
        Date
        shall
        mean the last day of each Offering Period.

       

      2.19 Fair
        Market Value
        of a
        share of Common Stock as of a given date shall mean: (i) if the Common Stock
        is
        listed or admitted to trading on an established stock exchange (including,
        for
        this purpose, the Nasdaq National Market), the mean of the highest and lowest
        sale prices for a share of the Common Stock on the composite tape or in Nasdaq
        National Market trading as reported in The
        Wall Street Journal (or,
        if
        not so reported, such other nationally recognized reporting source as the
        Committee shall select) for such date, or, if no such prices are reported
        for
        such date, the most recent day for which such prices are available shall
        be
        used; (ii) if the Common Stock is not then listed or admitted to trading
        on such
        a stock exchange, the mean of the closing representative bid and asked prices
        for the Common Stock on such date as reported by the Nasdaq Small Cap Market
        or,
        if not so reported, by the OTC Bulletin Board (or any successor or similar
        quotation system regularly reporting the market value of the Common Stock
        in the
        over-the-counter market), or, if no such prices are reported for such date,
        the
        most recent day for which such prices are available shall be used; or (iii)
        in
        the event neither of the valuation methods provided for in clauses (i) and
        (ii)
        above are practicable, the fair market value of a share of Common Stock
        determined by such other reasonable valuation method as the Committee shall,
        in
        its discretion, select and apply in good faith as of such date. 

       

      2.20 Non-Control
        Acquisition
        shall
        mean an acquisition by (1) an employee benefit plan (or a trust forming a
        part
        thereof) maintained by (x) the Company or (y) any corporation or other Person
        of
        which a majority of its voting power or its voting equity securities or equity
        interest is owned, directly or indirectly, by the Company (a “Related
        Entity”),
        (2)
        the Company or any Related Entity, (3) any of Thomas Russell, The AER Trust
        1997, Robert Louis-Dreyfus, Gallium Enterprises, Inc. and Reuben Richards,
        or
        (4) any Person in connection with a Non-Control Transaction.

       

      2.21 Offering
        Period
        shall
        mean a period as determined by the Committee during which a Participant’s Option
        may be exercised and the accumulated value of the Participant’s Account may be
        applied to purchase Common Stock. Unless otherwise specified by the Committee,
        the initial Offering Period will begin on the Effective Date and end on the
        last
        Trading Day on or before December 31st
        of the
        same calendar year. Thereafter, each successive Offering Period shall consist
        of
        twelve-month periods commencing on the first Trading Day on or after January
        1st
        of each
        calendar year and ending on the last Trading Day on or before December
        31st
        of such
        year. The duration of Offering Periods may be changed by the Committee or
        the
        Board pursuant to Section 3.06 or 5.04.

       

      2.22 Option
        shall
        mean the right to purchase the number of shares of Common Stock specified
        in
        accordance with the Plan at a price and for a term fixed in accordance with
        the
        Plan, and subject to such other limitations and restrictions as may be imposed
        by the Plan or the Committee in accordance with the Plan.

       

      2.23 Option
        Price
        shall
        mean an amount equal to 85% of the Fair Market Value of a share of Common
        Stock
        on the Enrollment Date or Exercise Date, whichever is lower. 

       

      2.24 Participant
        shall
        mean an Eligible Employee who satisfies the eligibility conditions of Article
        III, and to whom an Option has been granted by the Committee under the Plan.
        

       

      2.25 Person
        shall
        mean “person” as such term is used for purposes of Section 13(d) or 14(d) of the
        Exchange Act, including, without limitation, any individual, corporation,
        limited liability company, partnership, trust, unincorporated organization,
        government or any agency or political subdivision thereof, or any other entity
        or any group of Persons.

       

      2.26 Plan
        Year
        shall
        mean the period of twelve (12) or fewer consecutive months commencing on
        the
        Effective Date and ending on December 31st
        of the
        same calendar year, and the twelve (12) consecutive month period ending the
        last
        day of each December of each calendar year thereafter. The Committee may
        at any
        time designate another period as the Plan Year.

       

      2.27 Reserves
        shall
        mean the number of shares of Common Stock covered by each Option under the
        Plan
        that have not yet been exercised and the number of shares of Common Stock
        that
        have been authorized for issuance under the Plan but not yet placed under
        an
        Option. 

       

      2.28 Securities
        Act
        shall
        mean the Securities Act of 1933, as amended, and the rules and regulations
        promulgated by the Commission thereunder.

       

      2.29 Subsidiary
        shall
        mean any present or future corporation, domestic or foreign, which is or
        would
        be a “subsidiary corporation,” as defined under Section 424(f) of the Code, of
        the Company.

      

      2.30 Trading
        Day
        shall
        mean a day on which national stock exchanges are open for trading.

      

      2.31  Voting
        Securities
        shall
        mean all outstanding voting securities of the Company entitled to vote generally
        in the election of the Board.

       

       

      ARTICLE
        III

       

      ELIGIBILITY
        AND PARTICIPATION

       

      3.01
        Initial
        Eligibility

       

      Any
        individual who is otherwise an Eligible Employee and who is employed with
        the
        Company or a Designated Subsidiary on the Effective Date or becomes employed
        with the Company or a Designated Subsidiary after the Effective Date and
        is
        otherwise an Eligible Employee, may participate in the Plan immediately
        beginning with the first Offering Period that occurs concurrent with or next
        following either the Effective Date or that individual’s initial date of such
        employment. 

       

      3.02 Leave
        of Absence

       

      For
        purposes of the Plan, an individual’s employment relationship is still
        considered to be continuing intact while such individual is on sick leave,
        or
        other leave of absence approved by the Committee or the Participant’s
        supervisor; provided,
        however,
        that if
        the period of leave of absence exceeds ninety (90) days and the individual’s
        right to reemployment is not guaranteed either by statute or by contract,
        the
        employment relationship shall be deemed to have terminated on the ninety-first
        (91st)
        day of
        such leave.

       

      3.03
Eligibility
        Restrictions

       

      Notwithstanding
        any provisions of the Plan to the contrary, no employee of the Company or
        a
        Designated Subsidiary shall be granted an Option under the Plan:

       

      
        	 	
                (a)

              	
                if,
                  immediately after the Option is granted, applying the rules under
                  Section
                  424(d) of the Code to determine Common Stock ownership, such employee
                  would own, immediately after the Option is granted, five percent
                  (5%) or
                  more of the total combined voting power or value of all classes
                  of stock
                  of the Company or any Subsidiary; or

              

      

       

      
        	 	
                (b)

              	
                which
                  permits such employee’s rights to purchase stock under the Plan and any
                  other employee stock purchase plans of the Company or any Subsidiary
                  to
                  accrue at a rate that exceeds $25,000 (or such other amount as
                  may be
                  adjusted from time to time under applicable provisions of the Code
                  or
                  Regs) in Fair Market Value of Common Stock (determined at the time
                  such
                  Option is granted) for each calendar year in which such Option
                  is
                  outstanding.

              

      

       

      3.04
        Participation

       

      (a) An
        Eligible Employee may commence participation by completing an Agreement
        authorizing payroll deductions and filing it with the payroll office of the
        Company prior to the applicable Enrollment Date. Such an Eligible Employee
        is
        referred to as a Participant.

       

      (b) Any
        payroll deductions for a Participant shall commence on the first payroll
        date
        following the Enrollment Date and shall end on the last payroll date in the
        Offering Period to which such authorization is applicable, unless sooner
        terminated by the Participant as provided in Article VI. 

       

      3.05
Option
        Grant

       

      On
        the
        Enrollment Date of each Offering Period, each Participant participating in
        the
        Offering Period shall be granted an Option to purchase on the Exercise Date
        of
        such Offering Period (at the appropriate Option Price) up to a number of
        shares
        of Common Stock as determined by dividing the particular Participant’s payroll
        deductions that have accumulated prior to such Exercise Date and retained
        in
        such Participant’s Account as of that Exercise Date by the appropriate Option
        Price. Such purchase of shares of Common Stock shall be subject to the
        limitations under Sections 3.03 and 3.09. Exercise of the Option shall occur
        as
        provided in Section 3.07, unless the Participant has withdrawn as provided
        in
        Article VI. The Option shall expire on the last day of the Offering Period.
        The
        Committee may determine that there shall be no Options granted under the
        Plan
        for any particular Plan Year. 

       

      3.06
Offering
        Period

       

      The
        Plan
        shall be implemented by consecutive Offering Periods of Common Stock. Each
        Agreement shall specify the Offering Period for which the Option is granted,
        which shall be determined by the Committee in accordance with the Plan. The
        Committee shall have the authority to change the duration of Offering Periods,
        including the commencement dates thereof, with respect to future offerings
        without approval of the Company’s stockholders. Under such circumstances, any
        change to the Offering Periods shall be announced at least ten (10) days
        prior
        to the scheduled beginning of the initial Offering Period to be affected.
        In no
        event, however, shall an Offering Period extend beyond the period permitted
        under Section 423(b)(7) of the Code.

       

      3.07
Exercise
        of Option

       

      Unless
        a
        Participant provides written notice to the Company, or withdraws from the
        Plan
        as provided in Article VI, his Option for the purchase of shares shall be
        exercised automatically on the Exercise Date, and the maximum number of full
        shares subject to the Option shall be purchased for such Participant at the
        applicable Option Price, using the accumulated payroll deductions in his
        Account, subject to the limitations under Sections 3.03 and 3.09. No fractional
        shares shall be purchased. Any payroll deductions accumulated in an Account
        that
        are not sufficient to purchase a full share of Common Stock shall be retained
        in
        the Account for the subsequent Offering Period, subject to earlier withdrawal
        by
        the Participant as provided in Article VI. Any other monies remaining in
        a
        Participant’s Account after the Exercise Date shall be returned to the
        Participant or his Beneficiary in cash, without interest. During a Participant’s
        lifetime, such Participant’s Option is exercisable only by such
        Participant.

       

      3.08 Delivery
        of Stock

       

      (a) As
        promptly as practical after each Exercise Date on which a purchase of Common
        Stock occurs, the Company shall arrange the delivery to each Participant,
        or his
        Beneficiary, of a certificate representing the shares of Common Stock purchased
        upon exercise of such Participant’s Option, except that the Committee may
        determine that such shares shall be held for each Participant’s benefit by a
        broker designated by the Committee unless the Participant has delivered to
        the
        Committee a written election that certificates representing such shares be
        issued to him. Shares of Common Stock issued upon exercise of an Option and
        delivered to or for the benefit of a Participant or Beneficiary will be
        registered in the name of such Participant or Beneficiary, as the case may
        be.
        Alternatively, at the direction of a Participant through written notice to
        the
        Committee at least ten (10) days prior to the applicable Exercise Date, such
        shares shall be registered in the names of such Participant and one other
        person
        as may be designated by the Participant, as joint tenants with rights of
        survivorship, community property or as tenants by the entirety, to the extent
        permitted by applicable law.

      

      (b) The
        Committee may require a Participant or his Beneficiary to give prompt written
        notice to the Company concerning any disposition of shares of Common Stock
        received upon the exercise of such Participant’s Option within: (i) two (2)
        years from the date of granting of such Option to such Participant, (ii)
        one (1)
        year from the transfer of such shares of Common Stock to such Participant,
        or
        (iii) such other period as the Committee may from time to time determine.
        

      

      3.09 Maximum
        Number of Shares

      

      In
        no
        event shall the number of shares of Common Stock that a Participant may purchase
        during any one Offering Period under the Plan exceed the number of shares
        determined by (a) multiplying twenty percent (20%) of the amount of the
        Participant’s Compensation for the payroll period immediately preceding the date
        he is first granted an Option for such Offering Period by the number of payroll
        periods from such date to the end of such Offering Period, and (b) dividing
        that
        product by 85% of the Fair Market Value of a share of Common Stock on such
        date.

      

      3.10 Withholding

       

      At
        the
        time an Option is exercised, or at the time some or all of the Common Stock
        that
        is issued under the Plan is disposed of, the Company may withhold from any
        Compensation or other amount payable to the applicable Participant, or require
        such Participant to remit to the Company (or make other arrangements
        satisfactory to the Company, as determined in the Committee’s discretion,
        regarding payment to the Company of), the amount necessary for the Company
        to
        satisfy any Federal, state or local taxes required by law to be withheld
        with
        respect to the shares of Common Stock subject to such Option or disposed
        of, as
        a condition to delivery of any certificate or certificates for any such shares
        of Common Stock. Whenever under the Plan payments are to be made in cash,
        such
        payments shall be made net of an amount sufficient to satisfy any Federal,
        state
        or local tax or withholding obligations with respect to such
        payments.

      

       

      ARTICLE
        IV

       

      PAYROLL
        DEDUCTIONS

       

      4.01
Contribution
        Rate

       

      (a) At
        the
        time a Participant files an Agreement with the Committee authorizing payroll
        deduction, he may elect to have payroll deductions made on each payday during
        the Offering Period, and such Contribution Rate shall be a minimum of one
        percent (1%) and a maximum of ten percent (10%) of the Participant’s
        Compensation in effect on each payroll period during the Offering Period,
        unless
        the Committee determines otherwise in a manner applicable uniformly to all
        Participants. The payroll deductions shall only be made in whole percentages
        of
        the Participant’s Compensation. Participants may not make any separate cash
        payments outside payroll deductions under the Plan except as otherwise provided
        in Section 5.04(d) in the event of a Change in Control.

       

      (b) A
        Participant may discontinue his participation in the Plan as provided in
        Article
        VI, or may elect to decrease the rate of his payroll deductions during the
        Offering Period by filing a new Agreement with the Committee that authorizes
        a
        change in his Contribution Rate. Such election by the Participant to decrease
        his Contribution Rate shall only be permitted once during each Offering Period.
        The Committee may, in its discretion, in a fair and equitable manner, limit
        the
        number of Participants who change their Contribution Rate during any Offering
        Period. Any such change in Contribution Rate accepted by the Committee shall
        be
        effective with the first full payroll period following ten (10) business
        days
        after the Committee’s receipt of the new Agreement authorizing the new
        Contribution Rate, unless the Committee elects to process a change in the
        Contribution Rate more quickly. A Participant’s authorization to change his
        Contribution Rate shall remain in effect for successive Offering Periods
        unless
        terminated as provided in Article VI. 

       

      (c) Notwithstanding
        the foregoing provisions of this Section 4.01, the Committee may decrease
        a
        Participant’s Contribution Rate, but not below zero percent, at any time during
        an Offering Period to the extent necessary to comply with Section 423(b)(8)
        of
        the Code or Section 3.03 of the Plan. To the extent necessary in such case,
        payroll deductions shall recommence at the rate provided in such Participant’s
        Agreement at the beginning of the first Offering Period that is scheduled
        to
        begin in the following Plan Year, unless the Participant withdraws from the
        Plan
        in accordance with Article VI.

       

      4.02 Participant
        Account

       

      All
        payroll deductions made for a Participant shall be credited to his Account
        under
        the Plan.

       

      4.03
Interest 

       

      No
        interest shall accrue on the payroll deductions of a Participant under the
        Plan.
        In addition, no interest shall be paid on any and all money that is distributed
        to a Participant, or his Beneficiary, pursuant to the provisions of Sections
        6.01 and/or 6.03. 

      

      

      ARTICLE
        V

       

      COMMON
        STOCK

       

      5.01
        Shares
        Provided

       

      (a) The
        maximum number of shares of Common Stock that may be issued under the Plan
        shall
        be 2,000,000 shares. This number is subject to an adjustment upon any changes
        in
        capitalization of the Company as provided in Section 5.04. 

       

      (b) The
        Committee may determine, in its sole discretion, to include in the number
        of
        shares of Common Stock available under the Plan any shares of Common Stock
        that
        cease to be subject to an Option or are forfeited or any shares subject to
        an
        Option that terminates without issuance of shares of Common Stock actually
        being
        made to the Participant.

       

      (c) If
        the
        number of shares of Common Stock that Participants become entitled to purchase
        under the Plan is greater than the shares of Common Stock offered in a
        particular Offering Period or remaining available under the Plan, the available
        shares of Common Stock shall be allocated by the Committee among such
        Participants in such manner as the Committee determines is fair and
        equitable.

       

      5.02 Participant
        Interest 

       

      The
        Participant shall have no interest as a shareholder, including, without
        limitation, voting or dividend rights, with respect to shares of Common Stock
        covered by his Option until such Option has been exercised in accordance
        with
        the Plan and his Agreement.

       

      5.03
Restriction
        of Shares Upon Exercise

       

      The
        Committee may, in its discretion, require as conditions to the exercise of
        any
        Option that the shares of Common Stock reserved for issuance upon the exercise
        of the Option shall have been duly listed upon a stock exchange, and that
        either:

       

      
        	 	
                (a)

              	
                a
                  registration statement under the Securities Act with respect to
                  the shares
                  shall be effective, or

              

      

       

      
        	 	
                (b)

              	
                the
                  Participant shall have represented at the time of purchase, in
                  form and
                  substance satisfactory to the Company, that it is his intention
                  to
                  purchase the shares for investment and not for resale or
                  distribution.

              

      

       

      5.04
        Changes
        in Capital

       

      (a) Subject
        to any required action by the shareholders of the Company, upon changes in
        the
        outstanding Common Stock by reason of a stock split, reverse stock split,
        stock
        dividend, combination or exchange of shares, merger, recapitalization,
        consolidation, corporate separation or division of the Company (including,
        but
        not limited to, a split-up, spin-off, split-off or distribution to Company
        stockholders other than a normal cash dividend), reorganization,
        reclassification, or increase or decrease in the number of shares of capital
        stock of the Company effected without receipt of full consideration therefor,
        or
        any other similar change affecting the Company’s capital structure, the
        Committee shall make appropriate adjustments, in its discretion, to, or
        substitute, as applicable, the number, class and kind of shares of stock
        available for Options under the Plan, outstanding Options and the Reserves,
        the
        maximum number of shares that a Participant may purchase per Offering Period,
        the Option Prices of outstanding Options and any other characteristics or
        terms
        of the Options or the Plan as the Committee shall determine are necessary
        or
        appropriate to reflect equitably the effects of such changes to the
        Participants; provided,
        however,
        that
        any fractional shares resulting from any such adjustment shall be eliminated
        by
        rounding to the next lower whole number of shares with appropriate payment
        for
        such fractional shares as shall be reasonably determined by the Committee.
        Notice of any such adjustment shall be given by the Committee to each
        Participant whose Option has been adjusted and such adjustment, whether or
        not
        such notice has been given, shall be effective and binding for all purposes
        of
        the Plan.

      

      (b) The
        existence of the Plan and any Options granted hereunder shall not affect
        in any
        way the right or power of the Board or the shareholders of the Company to
        make
        or authorize any adjustment, recapitalization, reorganization or other change
        in
        the Company’s capital structure or its business, any merger or consolidation of
        the Company or a Subsidiary, any issue of debt, preferred or prior preference
        stock ahead of or affecting Common Stock, the authorization or issuance of
        additional shares of Common Stock, the dissolution or liquidation of the
        Company
        or any Subsidiary, any sale or transfer of all or part of the Company’s or a
        Subsidiary’s assets or business or any other corporate act or
        proceeding.

      

      (c) The
        Board
        may at any time terminate an Offering Period then in progress and provide,
        in
        its discretion, that Participants’ then outstanding Account balances shall be
        used to purchase shares pursuant to Article III or returned to the applicable
        Participants.

      

      (d) In
        the
        event of a Change in Control, the Committee may, in its discretion:

      

      
        	 	
                (i)

              	
                permit
                  each Participant to make a single sum payment with respect to his
                  outstanding Option before the Exercise Date equal to the amount
                  the
                  Participant would have contributed as determined by the Committee
                  for the
                  payroll periods remaining until the Exercise Date, and provide
                  for
                  termination of the Offering Period then in progress and purchase
                  of shares
                  pursuant to Article III; or

              

      

      

      
        	 	
                (ii)

              	
                provide
                  for payment in cash to each Participant of the amount standing
                  to his
                  Account plus an amount equal to the highest value of the consideration
                  to
                  be received in connection with such transaction for one share of
                  Common
                  Stock, or, if higher, the highest Fair Market Value of the Common
                  Stock
                  during the 30 consecutive Trading Days immediately prior to the
                  closing
                  date or expiration date of such transaction, less the Option Price
                  of the
                  Participant’s Option (determined for all purposes of this Section
                  5.04(d)(ii) using such closing or termination date as the Exercise
                  Date in
                  applying Section 2.23), multiplied by the number of full shares
                  of Common
                  Stock that could have been purchased for such Participant immediately
                  prior to the Change in Control with the amount standing to his
                  Account at
                  the Option Price, and that all Options so paid shall
                  terminate.

              

      

    

     

     

    
      ARTICLE
        VI

       

      WITHDRAWAL

       

      6.01 General

       

      By
        written notice to the Committee, at any time prior to the last day of any
        particular Offering Period, a Participant may elect to withdraw all of the
        accumulated payroll deductions in his Account at such time. All of the
        accumulated payroll deductions credited to such withdrawing Participant’s
        Account shall be paid to such Participant promptly after receipt of his written
        notice of withdrawal. In addition, upon the Participant’s written notice of
        withdrawal, the Participant’s Option for the Offering Period shall be
        automatically terminated, and no further payroll deductions for the purchase
        of
        shares on behalf of such Participant shall be made for such Offering Period.
        If
        a Participant withdraws from an Offering Period, payroll deductions shall
        not
        resume at the beginning of the succeeding Offering Period unless the Participant
        delivers to the Committee a new Agreement authorizing payroll
        deductions.

      

      6.02 Effect
        on Subsequent Participation

      

      A
        Participant’s withdrawal from an Offering Period shall not have any effect upon
        his eligibility to participate in any similar plan that may hereafter be
        adopted
        by the Company or a Subsidiary or in succeeding Offering Periods that commence
        after the termination of the Offering Period from which the Participant
        withdraws.

       

      6.03
Termination
        of Employment

       

      Upon
        termination of employment as an Eligible Employee, for any reason, a Participant
        shall be deemed to have elected to withdraw from the Plan and the payroll
        deductions credited to such Participant’s Account during the Offering Period but
        not yet used to exercise the Option shall be returned to such Participant,
        or,
        in the case of a Participant’s death, the payroll deductions credited to such
        deceased Participant’s Account shall be paid to his Beneficiary or
        Beneficiaries, and the Participant’s Option shall be automatically terminated. A
        transfer of a Participant’s employment between or among the Company and any
        Designated Subsidiary or Designated Subsidiaries shall not be treated as
        a
        termination of employment for purposes of the Plan.

      

      

      ARTICLE
        VII

      

      ADMINISTRATION

      

      7.01
Generally

       

      The
        Plan
        shall be administered by a committee the members of which are appointed by
        the
        Board. The Committee shall consist of no fewer than three (3) members.
        Notwithstanding the foregoing, the Board, in its absolute discretion, may
        at any
        time and from time to time exercise any and all rights, duties and
        responsibilities of the Committee under the Plan, including, but not limited
        to,
        establishing procedures to be followed by the Committee, except with respect
        to
        any matters which under any applicable law, regulation or rule are required
        to
        be determined in the sole discretion of the Committee. If and to the extent
        that
        no Committee exists which has the authority to administer the Plan, the
        functions of the Committee shall be exercised by the Board. In addition,
        the
        Board shall have discretionary authority to designate, from time to time,
        without approval of the Company’s stockholders, those Subsidiaries that shall be
        Designated Subsidiaries, the employees of which are eligible to participate
        in
        the Plan.

       

      7.02
Authority
        of the Committee

       

      The
        Committee shall have all authority that may be necessary or helpful to enable
        it
        to discharge its responsibilities with respect to the Plan. Without limiting
        the
        generality of the foregoing sentence or Section 7.01, subject to the express
        provisions of the Plan, the Committee shall have full and exclusive
        discretionary authority to interpret and construe any and all provisions
        of the
        Plan and any Agreements, determine eligibility to participate in the Plan,
        adopt
        rules and regulations for administering the Plan, adjudicate and determine
        all
        disputes arising under or in connection with the Plan, determine whether
        a
        particular item is included in “Compensation,” and make all other determinations
        deemed necessary or advisable for administering the Plan. Decisions, actions
        and
        determinations by the Committee with respect to the Plan or any Agreement
        shall
        be final, conclusive and binding on all parties. Except to the extent prohibited
        by applicable law or the rules of a stock exchange, the Committee may, in
        its
        discretion, from time to time, delegate all or any part of its responsibilities
        and powers under the Plan to any member or members of the management of the
        Company, and revoke any such delegation.

       

      7.03
Appointment

       

      The
        Board
        may from time to time appoint members to the Committee in substitution for
        or in
        addition to members previously appointed and may fill vacancies, however
        caused,
        on the Committee. The Committee may select one member as its Chair and shall
        hold its meetings at such times and places as it shall deem advisable. It
        may
        also hold telephonic meetings. A majority of its members shall constitute
        a
        quorum. All determinations of the Committee shall be made by a majority of
        its
        members. The Committee may correct any defect or omission or reconcile any
        inconsistency in the Plan or any Agreement in the manner and to the extent
        the
        Committee determines to be desirable. Any decision or determination reduced
        to
        writing and signed by a majority of the members of the Committee shall be
        as
        fully effective as if it had been made by a majority vote at a meeting duly
        called and held. The Committee may appoint a secretary and shall make such
        rules
        and regulations for the conduct of its business as it shall deem
        advisable.

      

      

      ARTICLE
        VIII

      

      MISCELLANEOUS

      

      8.01
        Designation
        of Beneficiary

       

      (a) A
        Participant may file with the Committee a written designation of a Beneficiary
        who is to receive any Common Stock and/or cash from the Participant’s Account in
        the event of such Participant’s death subsequent to an Exercise Date on which
        the Option is exercised but prior to delivery to such Participant of such
        Common
        Stock and cash. Unless a Participant’s written Beneficiary designation states
        otherwise, the designated Beneficiary shall also be entitled to receive any
        cash
        from the Participant’s Account in the event of such Participant’s death prior to
        exercise of his Option. 

      

      (b) A
        Participant’s designation of Beneficiary may be changed by the Participant at
        any time by written notice to the Committee. In the event of the death of
        a
        Participant and in the absence of a valid Beneficiary designation under the
        Plan
        at the time of such Participant’s death, the Company shall deliver the shares
        and/or cash to which the deceased Participant was entitled under the Plan
        to the
        executor or administrator of the estate of such Participant. If no such executor
        or administrator has been appointed as can be determined by the Committee,
        the
        Company shall deliver such shares and/or cash to the spouse or to any one
        or
        more dependents or relatives of the Participant, or if no spouse, dependent
        or
        relative is known to the Company, then to such other person as the Committee
        may
        designate. Any such delivery or payment shall be a complete discharge of
        the
        obligations and liabilities of the Company, the Subsidiaries, the Committee
        and
        the Board under the Plan.

       

      8.02
Transferability

       

      Neither
        payroll deductions credited to the Participant’s Account nor any rights with
        regard to the exercise of an Option or to receive Common Stock under the
        Plan
        may be assigned, transferred, pledged, or otherwise disposed of in any way
        other
        than by will, the laws of descent and distribution, or as provided under
        Section
        8.01. Any such attempt at assignment, transfer, pledge or other disposition
        shall be without effect, except that the Company may treat such act as an
        election to withdraw funds from an Offering Period in accordance with Article
        VI. 

      

      8.03 Conditions
        Upon Issuance of Shares

      

      (a) If
        at any
        time the Committee shall determine, in its discretion, that the listing,
        registration and/or qualification of shares of Common Stock upon any securities
        exchange or under any state or Federal law, or the consent or approval of
        any
        governmental regulatory body, is necessary or desirable as a condition of,
        or in
        connection with, the sale or purchase of shares of Common Stock hereunder,
        no
        Option may be exercised or paid in whole or in part unless and until such
        listing, registration, qualification, consent and/or approval shall have
        been
        effected or obtained, or otherwise provided for, free of any conditions not
        acceptable to the Committee.

       

      (b) If
        at any
        time counsel to the Company shall be of the opinion that any sale or delivery
        of
        shares of Common Stock pursuant to an Option is or may be in the circumstances
        unlawful, contravene the requirements of any stock exchange, or result in
        the
        imposition of excise taxes on the Company or any Subsidiary under the statutes,
        rules or regulations of any applicable jurisdiction, the Company shall have
        no
        obligation to make such sale or delivery, or to make any application or to
        effect or to maintain any qualification or registration under the Securities
        Act, or otherwise with respect to shares of Common Stock or Options and the
        right to exercise any Option shall be suspended until, in the opinion of
        such
        counsel, such sale or delivery shall be lawful or will not result in the
        imposition of excise taxes on the Company or any Subsidiary. 

       

      (c) The
        Committee, in its absolute discretion, may impose such restrictions on the
        ownership and transferability of the shares of Common Stock purchasable or
        otherwise receivable by any person under any Option as it deems appropriate.
        The
        certificates evidencing such shares may include any legend that the Committee
        deems appropriate to reflect any such restrictions.

       

      8.04 Participants
        Bound by Plan

       

      By
        accepting any benefit under the Plan, each Participant and each person claiming
        under or through such Participant shall be conclusively deemed to have indicated
        their acceptance and ratification of, and consent to, all of the terms and
        conditions of the Plan and any action taken under the Plan by the Committee,
        the
        Company or the Board, in any case in accordance with the terms and conditions
        of
        the Plan.

      

      8.05 Use
        of Funds

      

      All
        payroll deductions received or held by the Company under the Plan may be
        used by
        the Company for any corporate purpose, and the Company shall not be obligated
        to
        segregate such payroll deductions.

       

      8.06
Amendment
        or Termination

       

      The
        Board
        may terminate, discontinue, amend or suspend the Plan at any time, with or
        without notice to Participants. No such termination or amendment of the Plan
        may
        materially adversely affect the existing rights of any Participant with respect
        to any outstanding Option previously granted to such Participant, without
        the
        consent of such Participant, except for any amendment or termination permitted
        by Section 5.04. In addition, no amendment of the Plan by the Board shall,
        without the approval of the shareholders of the Company, (i) increase the
        maximum number of shares that may be issued under the Plan or that any
        Participant may purchase under the Plan in any Offering Period, except pursuant
        to Section 5.04; (ii) change the class of employees eligible to receive Options
        under the Plan, except as provided by the Board pursuant to the last sentence
        of
        Section 7.01; or (iii) change the formula by which the Option Price is
        determined under the Plan.

       

      8.07
No
        Employment Rights 

       

      The
        Plan
        does not, either directly or indirectly, create an independent right for
        the
        benefit of any employee or class of employees to purchase any shares of Common
        Stock under the Plan. In addition, the Plan does not create in any employee
        or
        class of employees any right with respect to continuation of employment by
        the
        Company or any Subsidiary, and the Plan shall not be deemed to interfere
        in any
        way with the Company’s or any Subsidiary’s employment at will relationship with
        the employee and/or interfere in any way with the Company’s or any Subsidiary’s
        right to terminate, or otherwise modify, an employee’s employment at any time or
        for any or no reason.

       

      8.08
Indemnification

       

      No
        current or previous member of the Board, or the Committee, nor any officer
        or
        employee of the Company acting on behalf of the Board, or the Committee,
        shall
        be personally liable for any action, determination, or interpretation taken
        or
        made in good faith with respect to the Plan. All such members of the Board
        or
        the Committee and each and every officer or employee of the Company acting
        on
        their behalf shall, to the extent permitted by law, be fully indemnified
        and
        protected by the Company in respect of any such action, determination or
        interpretation of the Plan. The foregoing right of indemnification shall
        not be
        exclusive of any other rights of indemnification to which such individuals
        may
        be entitled under the Company’s Certificate of Incorporation, or Bylaws, as a
        matter of law or otherwise.

       

      8.09
Construction
        of Plan 

       

      Whenever
        the context so requires, the masculine shall include the feminine and neuter,
        and the singular shall also include the plural, and conversely. The words
        “Article” and “Section” herein shall refer to provisions of the Plan, unless
        expressly indicated otherwise.

       

      8.10
Term
        of Plan

       

      Following
        the adoption of the Plan by the Board, and approval of the Plan by the
        shareholders of the Company who are present and represented at a special
        or
        annual meeting of the shareholders where a quorum is present, which approval
        must occur not earlier than one (1) year before, and not later than one (1)
        year
        after, the date the Plan is adopted by the Board, the Plan shall become
        effective on the Effective Date. 

       

      8.11 Unfunded
        Status of Plan

      

      The
        Plan
        shall be an unfunded plan.
        The
        Committee may authorize the creation of trusts or other arrangements to meet
        the
        obligations created under the Plan to deliver Common Stock or make payments,
        provided
        that the
        existence of such trusts or other arrangements is consistent with the unfunded
        status of the Plan.

       

      8.12 Governing
        Law

       

      The
        law
        of the State of New Jersey will govern all matters relating to the Plan except
        to the extent such law is superseded by the laws of the United
        States.

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