Document:

OPTIGENEX INC.
                            2004 Stock Incentive Plan

Section 1.          Purposes; Definitions.

         The purpose of the Optigenex Inc. 2004 Stock Incentive Plan is to
enable Optigenex Inc. to offer to those of its employees and to the employees of
its Subsidiaries and other persons who are expected to contribute to the success
of the Company, long term performance-based stock and/or other equity interests
in the Company, thereby enhancing the Company's ability to attract, retain and
reward such key employees or other persons, and to increase the mutuality of
interests between those employees or other persons and the shareholders of
Optigenex Inc.

        For purposes of the Plan, the following terms shall be defined as set
forth below:

        (a)   Board" means the Board of Directors of Optigenex Inc.

        (b)   Cause" shall have the meaning ascribed thereto in Section 5(b)(ix)
              below.

        (c)   Change of Control" shall have the meaning ascribed thereto in
              Section 9 below.

        (d)   Code" means the Internal Revenue Code of 1986, as amended from
              time to time and any successor thereto.

        (e)   Committee" means the Stock Incentive Committee of the Board or any
              other committee of the Board, which he Board may designate.

        (f)   Company" means Optigenex Inc., a corporation organized under the
              laws of the State of Delaware.

        (g)   Deferred Stock" means Stock to be received, under an award made
              pursuant to Section 7 below, at the end of a specified deferral
              period.

        (h)   "Disability" means a disability described in Section 22(e) of the
              Code, as determined under procedures established by the Board or
              the Committee for purposes of the Plan.

        (i)   "Early Retirement" means retirement, with the approval of the
              Board or the Committee, for purposes of one or more award(s)
              hereunder, from active employment with the Company or any Parent
              or Subsidiary prior to age 65.

        (j)   "Exchange Act" means the Securities Exchange Act of 1934, as
              amended, as in effect from time to time.

        (k)   "Fair Market Value", unless otherwise required by any applicable
              provision of the Code or any regulations issued thereunder, means,
              as of any given date: (i) if the principal market for the Stock is
              a national securities exchange or the National Association of
              Securities Dealers Automated Quotations System ("NASDAQ"), the
              closing sale price of the Stock on such day as reported by such
              exchange or market system, or on a consolidated tape reflecting
              transactions on such exchange or market system, or (b) if the
              principal market for the Stock is not a national securities
              exchange and the Stock is not quoted on NASDAQ, the mean between
              the closing bid sale price for the Stock on such day as reported
              by NASDAQ or the National Quotation Bureau, Inc.; provided that if
              clauses (a) and (b) of this paragraph are both inapplicable, or if
              no trades have been made or no quotes are available for such day,
              the Fair Market Value of the Stock shall be determined in good
              faith by the Board of Directors or the Committee, as the case may
              be, which determination shall be conclusive as to the Fair Market
              Value of the Stock.

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        (l)   "Incentive Stock Option" means any Stock Option which is intended
              to be and is designated as an "incentive stock option" within the
              meaning of Section 422 of the Code, or any successor thereto.

        (m)   "Non-Qualified Stock Option" means any Stock Option that is not an
              Incentive Stock Option.

        (n)   "Normal Retirement" means retirement from active employment with
              the Company or any Subsidiary on or after age 65.

        (o)   "Other Stock-Based Award" means an award under Section 8 below
              that is valued in whole or in part by reference to, or is
              otherwise based upon, Stock.

        (p)   "Parent" means any present or future parent of the Company, as
              such term is defined in Section 424(e) of the Code, or any
              successor thereto.

        (q)   "Plan" means this Optigenex Inc. 2003 Stock Incentive Plan, as
              hereafter amended from time to time.

        (r)   "Reorganization" of an entity shall be deemed to occur if such
              entity is a party to a merger, consolidation, reorganization, or
              other business combination with one or more entities in which said
              entity is not the surviving entity, if such entity disposes of
              substantially all of its assets, or if such entity is a party to a
              spin-off, split-off, split-up or similar transaction; provided,
              however, that the transaction shall not be a Reorganization if any
              Parent or any Subsidiary is the surviving entity.

        (s)   "Restricted Stock" means Stock, received under an award made
              pursuant to Section 6 below, that is subject to restrictions
              imposed pursuant to said Section 6.

        (t)   "Retirement" means Normal Retirement or Early Retirement.

        (u)   "Rule 16b-3" means Rule 16b-3 of the General Rules and Regulations
              under the Exchange Act, as in effect from time to time, and any
              successor thereto.

        (v)   "Securities Act" means the Securities Act of 1933, as amended, as
              in effect from time to time.

        (w)   "Stock" means the Common Stock of the Company, par value $.01 per
              share.

        (x)   "Stock Option" or "Option" means any option to purchase shares of
              Stock which is granted pursuant to the Plan.

        (y)   "Subsidiary" means any present or future (A) subsidiary
              corporation of the Company, as such term is defined in Section
              424(f) of the Code, or any successor thereto, or (B) except in the
              case of Incentive Stock Options, unincorporated business entity in
              which the Company owns, directly or indirectly, 50% or more of the
              voting rights, capital or profits.

SECTION 2.    ADMINISTRATION.

        The Plan shall be administered by the Board, or at its discretion, the
Committee, the membership of which shall consist solely of two or more members
of the Board, each of whom shall serve at the pleasure of the Board and shall be
a "Non-Employee Director," as defined in Rule 16b-3, and an "outside director,"
as defined in Section 162(m) of the Code, and shall be at all times constituted
so as not to adversely affect the compliance of the Plan with the requirements
of Rule 16b-3 or with the requirements of any other applicable law, rule or
regulation.

        The Board or the Committee, as the case may be, shall have the
authority to grant, pursuant to the terms of the Plan, to officers and other
employees or other persons eligible under Section 4 below: (i) Stock Options,
(ii) Restricted Stock, (iii) Deferred Stock, and/or (iv) Other Stock-Based
Awards.

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        For purposes of illustration and not of limitation, the Board or the
Committee, as the case may be, shall have the authority (subject to the express
provisions of the Plan):

        (i)   to select the officers, other employees of the Company or any
              Parent or Subsidiary and other persons to whom Stock Options,
              Restricted Stock, Deferred Stock and/or Other Stock-Based Awards
              may be from time to time granted hereunder;

        (ii)  to determine the Incentive Stock Options, Non-Qualified Stock
              Options, Restricted Stock, Deferred Stock and/or Other Stock-Based
              Awards, or any combination thereof, if any, to be granted
              hereunder to one or more eligible persons;

        (iii) to determine the number of shares of Stock to be covered by each
              award granted hereunder;

        (iv)  to determine the terms and conditions, not inconsistent with the
              terms of the Plan, of any award granted hereunder (including, but
              not limited to, share price, any restrictions or limitations, and
              any vesting acceleration, exercisability and/or forfeiture
              provisions);

        (v)   to determine the terms and conditions under which awards granted
              hereunder are to operate on a tandem basis and/or in conjunction
              with or apart from other awards made by the Company or any Parent
              or Subsidiary outside of the Plan;

        (vi)  to determine the extent and circumstances under which Stock and
              other amounts payable with respect to an award hereunder shall be
              deferred; and

        (vii) to substitute (A) new Stock Options for previously granted Stock
              Options, including previously granted Stock Options having higher
              option exercise prices and/or containing other less favorable
              terms, and (B) new awards of any other type for previously granted
              awards of the same type, including previously granted awards which
              contain less favorable terms.

        Subject to Section 10 hereof, the Board or the Committee, as the case
may be, shall have the authority to (i) adopt, alter and repeal such
administrative rules, guidelines and practices governing the Plan as it shall,
from time to time, deem advisable, (ii) interpret the terms and provisions of
the Plan and any award issued under the Plan (and to determine the form and
substance of all agreements relating thereto), and (iii) to otherwise supervise
the administration of the Plan.

        Subject to the express provisions of the Plan, all decisions made by the
Board or the Committee, as the case may be, pursuant to the provisions of the
Plan shall be made in the Board or the Committee's sole and absolute discretion
and shall be final and binding upon all persons, including the Company, its
Parent and Subsidiaries and the Plan participants and their beneficiaries.

SECTION 3.    STOCK SUBJECT TO PLAN.

        The total number of shares of Stock reserved and available for
distribution under the Plan shall be 5,000,000 shares. Such shares may consist,
in whole or in part, of authorized and unissued shares or treasury shares.

        If any shares of Stock that have been optioned cease to be subject to a
Stock Option for any reason (other than by exercise), or if any shares of Stock
that are subject to any Restricted Stock award, Deferred Stock award or Other
Stock-Based award are forfeited or any such award otherwise terminates without
the issuance of such shares, such shares shall again be available for
distribution under the Plan.

                                      -3-
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        In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend, stock split, extraordinary distribution with
respect to the Stock or other change in corporate structure affecting the Stock,
such substitution or adjustments shall be made in the (A) aggregate number of
shares of Stock reserved for issuance under the Plan, (B) number, kind and
exercise price of shares of Stock subject to outstanding Options granted under
the Plan, and (C) number, kind, purchase price and/or appreciation base of
shares of Stock subject to other outstanding awards granted under the Plan, as
may be determined to be appropriate by the Board or the Committee, as the case
may be, in order to prevent dilution or enlargement of rights; provided,
however, that the number of shares of Stock subject to any award shall always be
a whole number. Such adjusted exercise price shall also be used to determine the
amount which is payable to the optionee upon the exercise by the Board or the
Committee, as the case may be, of the alternative settlement right which is set
forth in Section 5(b)(xi) below.

        Subject to the provisions of the immediately preceding paragraph, the
maximum numbers of shares subject to Options, Restricted Stock awards, Deferred
Stock awards, and other Stock-Based awards to any one participant shall be
1,500,000 shares during the term of the Plan.

SECTION 4.    ELIGIBILITY.

        Officers and other employees of the Company or any Parent or Subsidiary
(but excluding any person whose eligibility would adversely affect the
compliance of the Plan with the requirements of Rule 16b-3) who are at the time
of the grant of an award under the Plan employed by the Company or any Parent or
Subsidiary and who are responsible for or contribute to the management, growth
and/or profitability of the business of the Company or any Parent or Subsidiary,
are eligible to be granted Options and awards under the Plan. In addition,
Non-Qualified Stock Options and other awards may be granted under the Plan to
any person, including, but not limited to, independent agents, consultants and
attorneys who the Board or the Committee, as the case may be, believes has
contributed or will contribute to the success of the Company. Eligibility under
the Plan shall be determined by the Board or the Committee, as the case may be.

        The Board or the Committee, as the case may be, may, in its sole
discretion, include additional conditions and restrictions in the agreement
entered into in connection with such awards under the Plan. The grant of an
Option or other award under the Plan, and any determination made in connection
therewith, shall be made on a case by case basis and can differ among optionees
and grantees. The grant of an Option or other award under the Plan is a
privilege and not a right and the determination of the Board or the Committee,
as the case may be, can be applied on a non-uniform and discretionary basis.

SECTION 5. STOCK OPTIONS.

        (a)   Grant and Exercise. Stock Options granted under the Plan may be of
              two types: (i) Incentive Stock Options and (ii) Non-Qualified
              Stock Options. Any Stock Option granted under the Plan shall
              contain such terms as the Board or the Committee, as the case may
              be, may from time to time approve. The Board or the Committee, as
              the case may be, shall have the authority to grant to any optionee
              Incentive Stock Options, Non-Qualified Stock Options, or both
              types of Stock Options, and they may be granted alone or in
              addition to other awards granted under the Plan. To the extent
              that any Stock Option is not designated as an Incentive Stock
              Option or does not qualify as an Incentive Stock Option, it shall
              constitute a Non-Qualified Stock Option. The grant of an Option
              shall be deemed to have occurred on the date on which the Board or
              the Committee, as the case may be, by resolution, designates an
              individual as a grantee thereof, and determines the number of
              shares of Stock subject to, and the terms and conditions of, said
              Option.

              Anything in the Plan to the contrary notwithstanding, no term of
              the Plan relating to Incentive Stock Options or any agreement
              providing for Incentive Stock Options shall be interpreted,
              amended or altered, nor shall any discretion or authority granted
              under the Plan be exercised, so as to disqualify the Plan under
              Section 422 of the Code, or, without the consent of the
              optionee(s) affected, to disqualify any Incentive Stock Option
              under said Section 422.

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        (b)   Terms and Conditions. Stock Options granted under the Plan shall
              be subject to the following terms and conditions:

              (i)    Option Price. The option price per share of Stock
                     purchasable under a Stock Option shall be determined by the
                     Board or the Committee, as the case may be, at the time of
                     grant but as to Incentive Stock Options shall be not less
                     than 100% (110% in the case of an Incentive Stock Option
                     granted to an optionee ("10% Shareholder") who, at the time
                     of grant, owns Stock possessing more than 10% of the total
                     combined voting power of all classes of stock of the
                     Company or its Parent, if any, or any of its Subsidiaries)
                     of the Fair Market Value of the Stock at the time of grant.
                     The option price for Non-Qualified Stock Options shall be
                     determined by the Board or the Committee, as the case may
                     be, at the time of grant, subject to the Delaware General
                     Corporation Law.

              (ii)   Option Term. The term of each Stock Option shall be fixed
                     by the Board or the Committee, as the case may be, but no
                     Incentive Stock Option shall be exercisable more than ten
                     years (five years, in the case of an Incentive Stock Option
                     granted to a 10% Shareholder) after the date on which the
                     Option is granted.

              (iii)  Exercisability. Stock Options shall be exercisable at such
                     time or times and subject to such terms and conditions as
                     shall be determined by the Board or the Committee, as the
                     case may be, at the time of grant. If the Board or the
                     Committee, as the case may be, provides, in its discretion,
                     that any Stock Option is exercisable only in installments,
                     the Board or the Committee, as the case may be, may waive
                     such installment exercise provisions at any time at or
                     after the time of grant in whole or in part, based upon
                     such factors as the Board or the Committee, as the case may
                     be, shall determine.

              (iv)   Method of Exercise. Subject to whatever installment,
                     exercise and waiting period provisions are applicable in a
                     particular case, Stock Options may be exercised in whole or
                     in part at any time during the option period by giving
                     written notice of exercise to the Company specifying the
                     number of shares of Stock to be purchased. Such notice
                     shall be accompanied by payment in full of the purchase
                     price, which shall be in cash. Notwithstanding the
                     foregoing, if provided in the Stock Option agreement
                     referred to in Section 5(b)(xii) below or otherwise
                     permitted by the Board or the Committee, as the case may
                     be, payment of the purchase price may be made (i) in whole
                     shares of Stock which are already owned by the holder of
                     the Option or (ii) partly in cash and partly in such Stock.
                     Cash payments shall be made by wire transfer, certified or
                     bank check or personal check, in each case payable to the
                     order of the Company; provided, however, that the Company
                     shall not be required to deliver certificates for shares of
                     Stock with respect to which an Option is exercised until
                     the Company has confirmed the receipt of good and available
                     funds in payment of the purchase price thereof. Payments in
                     the form of Stock (which shall be valued at the Fair Market
                     Value of a share of Stock on the date of exercise) shall be
                     made by delivery of stock certificates in negotiable form
                     which are effective to transfer good and valid title
                     thereto to the Company, free of any liens or encumbrances.
                     In addition to the foregoing, if provided in the Stock
                     Option agreement referred to in Section 5(b)(xii) below or
                     otherwise permitted by the Board or the Committee, as the
                     case may be, payment of the exercise price may be made by
                     delivery to the Company by the optionee of an executed
                     exercise form, together with irrevocable instructions to a
                     broker-dealer to sell or margin a sufficient portion of the
                     shares covered by the option and deliver the sale or margin
                     loan proceeds directly to the Company. Except as otherwise
                     expressly provided in the Plan or in the Stock Option
                     agreement referred to in Section 5(b)(xii) below, no Option
                     which is granted to a person who is at the time of grant an
                     employee of the Company or of a Subsidiary or Parent of the
                     Company may be exercised at any time unless the holder
                     thereof is then an employee of the Company or of a Parent
                     or a Subsidiary. The holder of an Option shall have none of
                     the rights of a shareholder with respect to the shares
                     subject to the Option until the optionee has given written
                     notice of exercise, has paid in full for those shares of
                     Stock and, if requested by the Board or Committee, as the
                     case may be, has given the representation described in
                     Section 12(a) below.

                                      -5-
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              (v)    Transferability; Exercisability. No Stock Option shall be
                     transferable by the optionee other than by will or by the
                     laws of descent and distribution, except as may be
                     otherwise provided with respect to a Non-Qualified Option
                     pursuant to the specific provisions of the Stock Option
                     agreement pursuant to which it was issued as referred to in
                     Section 5(b)(xii) below. Except as otherwise provided in
                     the Stock Option agreement relating to a Non-Qualified
                     Stock Option, all Stock Options shall be exercisable,
                     during the optionee's lifetime, only by the optionee or his
                     or her guardian or legal representative.

              (vi)   Termination by Reason of Death. Subject to Section 5(b)(x)
                     below, if an optionee's employment by the Company or any
                     Parent or Parent or Subsidiary terminates by reason of
                     death, any Stock Option held by such optionee may
                     thereafter be exercised, to the extent then exercisable or
                     on such accelerated basis as the Board or Committee, as the
                     case may be, may determine at or after the time of grant,
                     for a period of one year (or such other period as the Board
                     or the Committee, as the case may be, may specify at or
                     after the time of grant) from the date of death or until
                     the expiration of the stated term of such Stock Option,
                     whichever period is the shorter.

              (vii)  Termination by Reason of Disability. Subject to Section
                     5(b)(x) below, if an optionee's employment by the Company
                     or any Parent or Subsidiary terminates by reason of
                     Disability, any Stock Option held by such optionee may
                     thereafter be exercised by the optionee, to the extent it
                     was exercisable at the time of termination or on such
                     accelerated basis as the Board or the Committee, as the
                     case may be, may determine at or after the time of grant,
                     for a period of one year (or such other period as the Board
                     or the Committee, as the case may be, may specify at or
                     after the time of grant) from the date of such termination
                     of employment or until the expiration of the stated term of
                     such Stock Option, whichever period is the shorter;
                     provided, however, that if the optionee dies within such
                     one year period (or such other period as the Board or the
                     Committee, as the case may be, shall specify at or after
                     the time of grant), any unexercised Stock Option held by
                     such optionee shall thereafter be exercisable to the extent
                     to which it was exercisable at the time of death for a
                     period of one year from the date of death or until the
                     expiration of the stated term of such Stock Option,
                     whichever period is the shorter.

              (viii) Termination by Reason of Retirement. Subject to Section
                     5(b)(x) below, if an optionee's employment by the Company
                     or any Parent or Subsidiary terminates by reason of Normal
                     Retirement, any Stock Option held by such optionee may
                     thereafter be exercised by the optionee, to the extent it
                     was exercisable at the time of termination or on such
                     accelerated basis as the Board or the Committee, as the
                     case may be, may determine at or after the time of grant in
                     the case of a Non-Qualified Stock Option, for a period of
                     one year, or, in the case of an Incentive Stock Option, for
                     a period of three months (or such other period as the Board
                     or the Committee, as the case may be, may specify at or
                     after the time of grant) from the date of such termination
                     of employment or the expiration of the stated term of such
                     Stock Option, whichever period is the shorter; provided,
                     however, that if the optionee dies within such one year
                     period (or such other period as the Board or the Committee,
                     as the case may be, shall specify at or after the date of
                     grant), any unexercised Stock Option held by such optionee
                     shall thereafter be exercisable to the extent to which it
                     was exercisable at the time of death for a period of one
                     year from the date of death or until the expiration of the
                     stated term of such Stock Option, whichever period is the
                     shorter. If an optionee's employment with the Company or
                     any Parent or Subsidiary terminates by reason of Early
                     Retirement, the Stock Option shall thereupon terminate;
                     provided, however, that if the Board or the Committee, as
                     the case may be, so approves at the time of Early
                     Retirement, any Stock Option held by the optionee may
                     thereafter be exercised by the optionee as provided above
                     in connection with termination of employment by reason of
                     Normal Retirement.

                                      -6-
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              (ix)   Other Termination. Subject to the provisions of Section 12
                     below and unless otherwise determined by the Committee at
                     or after the time of grant, if an optionee's employment by
                     the Company or any Parent or Subsidiary terminates for any
                     reason other than death, Disability or Retirement, the
                     Stock Option shall thereupon automatically terminate,
                     except that if the optionee is involuntarily terminated by
                     the Company or any Parent or a Subsidiary without Cause (as
                     hereinafter defined), such Stock Option may be exercised
                     for a period of three months (or such other period as the
                     Board or the Committee, as the case may be, shall specify
                     at or after the time of grant) from the date of such
                     termination or until the expiration of the stated terms of
                     such Stock Option, whichever period is the shorter. For
                     purposes of the Plan, "Cause" shall mean (1) the conviction
                     of the optionee of a felony under Federal law or the law of
                     the state in which such action occurred, (2) dishonesty by
                     the optionee in the course of fulfilling his or her
                     employment duties, or (3) the failure on the part of the
                     optionee to perform his or her employment duties in any
                     material respect. In addition, with respect to an option
                     granted to an employee of the Company, a Parent or a
                     Subsidiary, for purposes of the Plan, "Cause" shall also
                     include any definition of "Cause" contained in any
                     employment or other agreement between the optionee and the
                     Company, Parent or Subsidiary, as the case may be.

              (x)    Additional Incentive Stock Option Limitation. In the case
                     of an Incentive Stock Option, the aggregate Fair Market
                     Value of Stock (determined at the time of grant of the
                     Option) with respect to which Incentive Stock Options are
                     exercisable for the first time by an optionee during any
                     calendar year (under all such plans of optionee's employer
                     corporation and its Parent and Subsidiaries) shall not
                     exceed $100,000.

              (xi)   Alternative Settlement of Option. Upon the receipt of
                     written notice of exercise or if provided for with respect
                     to a Stock Option pursuant to the specific provisions of
                     the Stock Option agreement pursuant to which it was issued
                     and referred to in Section 5(b)(xii) (unless otherwise
                     provided with respect to a Stock Option pursuant to the
                     specific provisions of the Stock Option agreement pursuant
                     to which it was issued and referred to in Section
                     5(b)(xii)), the Board or the Committee, as the case may be,
                     may elect to settle all or part of any Stock Option by
                     paying to the optionee an amount, in cash or Stock (valued
                     at Fair Market Value on the date of exercise), equal to the
                     product of the excess of the Fair Market Value of one share
                     of Stock, on the date of exercise over the Option exercise
                     price, multiplied by the number of shares of Stock with
                     respect to which the optionee proposes to exercise the
                     Option. Any such settlements which relate to Options which
                     are held by optionees who are subject to Section 16(b) of
                     the Exchange Act shall comply with any "window period"
                     provisions of Rule 16b-3, to the extent applicable, and
                     with such other conditions as the Board or Committee may
                     impose.

                                      -7-
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              (xii)  Stock Option Agreement. Each grant of a Stock Option shall
                     be confirmed by, and shall be subject to the terms of, an
                     agreement executed by the Company and the participant.

Section 6.    Restricted Stock.

        (a)   Grant and Exercise. Shares of Restricted Stock may be issued
              either alone or in addition to or in tandem with other awards
              granted under the Plan. The Board or the Committee, as the case
              may be, shall determine the eligible persons to whom, and the time
              or times at which, grants of Restricted Stock will be made, the
              number of shares to be awarded, the price (if any) to be paid by
              the recipient, the time or times within which such awards may be
              subject to forfeiture (the "Restriction Period"), the vesting
              schedule and rights to acceleration thereof, and all other terms
              and conditions of the awards. The Board or the Committee, as the
              case may be, may condition the grant of Restricted Stock upon the
              attainment of such factors as the Board or the Committee, as the
              case may be, may determine.

        (b)   Terms and Conditions. Each Restricted Stock award shall be subject
              to the following terms and conditions:

              (i)    Restricted Stock, when issued, will be represented by a
                     stock certificate or certificates registered in the name of
                     the holder to whom such Restricted Stock shall have been
                     awarded. During the Restriction Period, certificates
                     representing the Restricted Stock and any securities
                     constituting Retained Distributions (as defined below)
                     shall bear a restrictive legend to the effect that
                     ownership of the Restricted Stock (and such Retained
                     Distributions), and the enjoyment of all rights related
                     thereto, are subject to the restrictions, terms and
                     conditions provided in the Plan and the Restricted Stock
                     agreement referred to in Section 6(b)(iv) below. Such
                     certificates shall be deposited by the holder with the
                     Company, together with stock powers or other instruments of
                     assignment, endorsed in blank, which will permit transfer
                     to the Company of all or any portion of the Restricted
                     Stock and any securities constituting Retained
                     Distributions that shall be forfeited or that shall not
                     become vested in accordance with the Plan and the
                     applicable Restricted Stock agreement.

              (ii)   Restricted Stock shall constitute issued and outstanding
                     shares of Common Stock for all corporate purposes, and the
                     issuance thereof shall be made for at least the minimum
                     consideration (if any) necessary to permit the shares of
                     Restricted Stock to be deemed to be fully paid and
                     nonassessable. The holder will have the right to vote such
                     Restricted Stock, to receive and retain all regular cash
                     dividends and other cash equivalent distributions as the
                     Board may in its sole discretion designate, pay or
                     distribute on such Restricted Stock and to exercise all
                     other rights, powers and privileges of a holder of Stock
                     with respect to such Restricted Stock, with the exceptions
                     that (A) the holder will not be entitled to delivery of the
                     stock certificate or certificates representing such
                     Restricted Stock until the Restriction Period shall have
                     expired and unless all other vesting requirements with
                     respect thereto shall have been fulfilled; (B) the Company
                     will retain custody of the stock certificate or
                     certificates representing the Restricted Stock during the
                     Restriction Period; (C) other than regular cash dividends
                     and other cash equivalent distributions as the Board may in
                     its sole discretion designate, pay or distribute, the
                     Company will retain custody of all distributions ("Retained
                     Distributions") made or declared with respect to the
                     Restricted Stock (and such Retained Distributions will be
                     subject to the same restrictions, terms and conditions as
                     are applicable to the Restricted Stock) until such time, if
                     ever, as the Restricted Stock with respect to which such

                                      -8-
<PAGE>

                     Retained Distributions shall have been made, paid or
                     declared shall have become vested and with respect to which
                     the Restriction Period shall have expired; (D) the holder
                     may not sell, assign, transfer, pledge, exchange, encumber
                     or dispose of the Restricted Stock or any Retained
                     Distributions during the Restriction Period; and (E) a
                     breach of any of the restrictions, terms or conditions
                     contained in the Plan or the Restricted Stock agreement
                     referred to in Section 6(b)(iv) below, or otherwise
                     established by the Board or Committee, as the case may be,
                     with respect to any Restricted Stock or Retained
                     Distributions will cause a forfeiture of such Restricted
                     Stock and any Retained Distributions with respect thereto.

              (iii)  Upon the expiration of the Restriction Period with respect
                     to each award of Restricted Stock and the satisfaction of
                     any other applicable restrictions, terms and conditions (A)
                     all or part of such Restricted Stock shall become vested in
                     accordance with the terms of the Restricted Stock agreement
                     referred to in Section 6(b)(iv) below, and (B) any Retained
                     Distributions with respect to such Restricted Stock shall
                     become vested to the extent that the Restricted Stock
                     related thereto shall have become vested. Any such
                     Restricted Stock and Retained Distributions that do not
                     vest shall be forfeited to the Company and the holder shall
                     not thereafter have any rights with respect to such
                     Restricted Stock and Retained Distributions that shall have
                     been so forfeited.

              (iv)   Each Restricted Stock award shall be confirmed by, and
                     shall be subject to the terms of, an agreement executed by
                     the Company and the participant.

SECTION 7.    DEFERRED STOCK.

        (a)   GRANT AND EXERCISE. Deferred Stock may be awarded either alone or
              in addition to or in tandem with other awards granted under the
              Plan. The Board or the Committee, as the case may be, shall
              determine the eligible persons to whom and the time or times at
              which Deferred Stock shall be awarded, the number of shares of
              Deferred Stock to be awarded to any person, the duration of the
              period (the "Deferral Period") during which, and the conditions
              under which, receipt of the Deferred Stock will be deferred, and
              all the other terms and conditions of the awards. The Board or the
              Committee, as the case may be, may condition the grant of the
              Deferred Stock upon the attainment of such factors or criteria as
              the Board or the Committee, as the case may be, shall determine.

        (b)   TERMS AND CONDITIONS. Each Deferred Stock award shall be subject
              to the following terms and conditions:

              (i)    Subject to the provisions of the Plan and Deferred Stock
                     agreement referred to in Section 7(b)(vii) below, Deferred
                     Stock awards may not be sold, assigned, transferred,
                     pledged or otherwise encumbered during the Deferral Period.
                     At the expiration of the Deferral Period (or the Additional
                     Deferral Period referred to in Section 7(b)(vi) below,
                     where applicable), share certificates shall be delivered to
                     the participant, or his legal representative, in a number
                     equal to the shares of Stock covered by the Deferred Stock
                     award.

              (ii)   As determined by the Board or the Committee, as the case
                     may be, at the time of award, amounts equal to any
                     dividends declared during the Deferral Period (or the
                     Additional Deferral Period referred to in Section 7(b)(vi)
                     below, where applicable) with respect to the number of
                     shares covered by a Deferred Stock award may be paid to the
                     participant currently or deferred and deemed to be
                     reinvested in additional Deferred Stock.

                                      -9-
<PAGE>

              (iii)  Subject to the provisions of the Deferred Stock agreement
                     referred to in Section 7(b)(vii) below and this Section 7
                     and Section 11(g) below, upon termination of a
                     participant's employment with the Company or any Parent or
                     Subsidiary for any reason during the Deferral Period (or
                     the Additional Deferral Period referred to in Section
                     7(b)(vi) below, where applicable) for a given award, the
                     Deferred Stock in question will vest or be forfeited in
                     accordance with the terms and conditions established by the
                     Board or the Committee, as the case may be, at the time of
                     grant.

              (iv)   The Board or the Committee, as the case may be, may, after
                     grant, accelerate the vesting of all or any part of any
                     Deferred Stock award and/or waive the deferral limitations
                     for all or any part of a Deferred Stock award.

              (v)    In the event of hardship or other special circumstances of
                     a participant whose employment with the Company or any
                     Parent or Subsidiary is involuntarily terminated (other
                     than for Cause), the Board or the Committee, as the case
                     may be, may waive in whole or in part any or all of the
                     remaining deferral limitations imposed hereunder or
                     pursuant to the Deferred Stock agreement referred to in
                     Section 7(b)(vii) below with respect to any or all of the
                     participant's Deferred Stock.

              (vi)   A participant may request to, and the Board or the
                     Committee, as the case may be, may at any time, defer the
                     receipt of an award (or an installment of an award) for an
                     additional specified period or until a specified period or
                     until a specified event (the "Additional Deferral Period").
                     Subject to any exceptions adopted by the Board or the
                     Committee, as the case may be, such request must be made at
                     least one year prior to expiration of the Deferral Period
                     for such Deferred Stock award (or such installment).

              (vii)  Each Deferred Stock award shall be confirmed by, and shall
                     be subject to the terms of, an agreement executed by the
                     Company and the participant.

SECTION 8.    OTHER STOCK-BASED AWARDS.

        (a)   GRANT AND EXERCISE. Other Stock-Based Awards, which may include
              performance shares and shares valued by reference to the
              performance of the Company or any Parent or Subsidiary, may be
              granted either alone or in addition to or in tandem with Stock
              Options, Restricted Stock or Deferred Stock. The Board or the
              Committee, as the case may be, shall determine the eligible
              persons to whom, and the time or times at which, such awards shall
              be made, the number of shares of Stock to be awarded pursuant to
              such awards, and all other terms and conditions of the awards. The
              Board or the Committee, as the case may be, may also provide for
              the grant of Stock under such awards upon the completion of a
              specified performance period.

        (b)   Terms and Conditions. Each Other Stock-Based Award shall be
              subject to the following terms and conditions:

              (i)    Shares of Stock subject to an Other Stock-Based Award may
                     not be sold, assigned, transferred, pledged or otherwise
                     encumbered prior to the date on which the shares are
                     issued, or, if later, the date on which any applicable
                     restriction or period of deferral lapses.

              (ii)   The recipient of an Other Stock-Based Award shall be
                     entitled to receive, currently or on a deferred basis,
                     dividends or dividend equivalents with respect to the
                     number of shares covered by the award, as determined by the
                     Board or the Committee, as the case may be, at the time of
                     the award. The Board or the Committee, as the case may be,
                     may provide that such amounts (if any) shall be deemed to
                     have been reinvested in additional Stock.

                                      -10-
<PAGE>

              (iii)  Any Other Stock-Based Award and any Stock covered by any
                     Other Stock-Based Award shall vest or be forfeited to the
                     extent so provided in the award agreement referred to in
                     Section 8(b)(v) below, as determined by the Board or the
                     Committee, as the case may be.

              (iv)   In the event of the participant's Retirement, Disability or
                     death, or in cases of special circumstances, the Board or
                     the Committee, as the case may be, may waive in whole or in
                     part any or all of the limitations imposed hereunder (if
                     any) with respect to any or all of an Other Stock-Based
                     Award.

              (v)    Each Other Stock-Based Award shall be confirmed by, and
                     shall be subject to the terms of, an agreement executed by
                     the Company and by the participant.

SECTION 9.    CHANGE OF CONTROL PROVISIONS.

        (a)   A "Change of Control" shall be deemed to have occurred on the
              tenth day after:

              (i)    any individual, corporation or other entity or group (as
                     defined in Section 13(d)(3) of the Exchange Act), other
                     than William G. Walters or Richard S. Serbin and their
                     family members and their affiliates, becomes, directly or
                     indirectly, the beneficial owner (as defined in the General
                     Rules and Regulations of the Securities and Exchange
                     Commission with respect to Sections 13(d) and 13(g) of the
                     Exchange Act) of more than 50% of the then outstanding
                     shares of the Company's capital stock entitled to vote
                     generally in the election of directors of the Company; or

              (ii)   the commencement of, or the first public announcement of
                     the intention of any individual, firm, corporation or other
                     entity or of any group (as defined in Section 13(d)(3) of
                     the Exchange Act) to commence, a tender or exchange offer
                     subject to Section 14(d)(1) of the Exchange Act for any
                     class of the Company's capital stock; or

              (iii)  the shareholders of the Company approve (A) a definitive
                     agreement for the merger or other business combination of
                     the Company with or into another corporation pursuant to
                     which the shareholders of the Company do not own,
                     immediately after the transaction, more than 50% of the
                     voting power of the corporation that survives, or (B) a
                     definitive agreement for the sale, exchange or other
                     disposition of all or substantially all of the assets of
                     the Company, or (C) any plan or proposal for the
                     liquidation or dissolution of the Company;

              provided, however, that a "Change of Control" shall not be deemed
              to have taken place if beneficial ownership is acquired (I)
              directly from the Company, other than an acquisition by virtue of
              the exercise or conversion of another security unless the security
              so converted or exercised was itself acquired directly from the
              Company, or (II) by, or a tender or exchange offer is commenced or
              announced by, the Company, any profit-sharing, employee ownership
              or other employee benefit plan of the Company; or any trustee of
              or fiduciary with respect to any such plan when acting in such
              capacity.

        (b)   Unless otherwise provided in the Stock Option agreement, or
              agreement relating to a Restricted Stock award, Deferred Stock
              award or Other Stock Based Award, in the event of a Change of
              Control of the Company, the Board may, in its sole and absolute
              discretion, provide on a case by case basis that some or all
              outstanding awards granted under this Plan become immediately
              exercisable or vested, without regard to any limitation imposed
              pursuant to this Plan. In the event of a Change of Control of the
              Company, the Board may, in its sole and absolutely discretion,
              provide on a case by case basis, that Stock Options shall
              terminate upon such Change of Control; provided, however, that the

                                      -11-
<PAGE>

              optionee shall have the right, immediately prior to the occurrence
              of such Change of Control and during such reasonable period as the
              Board in its sole and absolute discretion shall determine and
              designate, to exercise any vested options in whole or in part.

        (c)   Unless otherwise provided in a Stock Option agreement or agreement
              relating to a Restricted Stock award, Deferred Stock award or
              Other Stock-Based Award, in the event of a Change in Control of a
              Parent or Subsidiary or Reorganization of a Parent or Subsidiary,
              or in the event that a Parent or Subsidiary ceases to be a
              "parent" or "subsidiary", as such terms are defined in Section 424
              of the Code, the Board may, in its sole and absolute discretion,
              (i) provide on a case by case basis that some or all outstanding
              awards held by an optionee or a participant employed by or
              performing service for such Parent or Subsidiary may become
              immediately exercisable or vested, without regard to any
              limitation imposed pursuant to this Plan and/or (ii) treat the
              employment or other services of an optionee or participant
              employed by such Parent or Subsidiary as terminated (and such
              optionee shall have the right to exercise his or her Stock Options
              in accordance with Section 5(b) of this Plan) if such optionee or
              grantee is not employed by the Company or any Parent or Subsidiary
              immediately after such event.

SECTION 10.   AMENDMENTS AND TERMINATION.

         The Board may at any time, and from time to time, amend any of the
provisions of the Plan, and may at any time suspend or terminate the Plan;
provided, however, that no such amendment shall be effective unless and until it
has been duly approved by the holders of the outstanding shares of Stock if the
failure to obtain such approval would adversely affect the compliance of the
Plan with the requirements of Rule 16b-3 or any other applicable law, rule or
regulation. The Board or the Committee, as the case may be, may amend the terms
of any Stock Option or other award theretofore granted under the Plan; provided,
however, that subject to Section 3 above, no such amendment may be made by the
Board or the Committee, as the case may be, which in any material respect
impairs the rights of the optionee or participant without the optionee's or
participant's consent, except for such amendments which are made to cause the
Plan to qualify for the exemption provided by Rule 16b-3.

SECTION 11.   UNFUNDED STATUS OF PLAN.

         The Plan is intended to constitute an "unfunded" plan for incentive and
deferred compensation. With respect to any payments not yet made to a
participant or optionee by the Company, nothing contained herein shall give any
such participant or optionee any rights that are greater than those of a
creditor of the Company.

SECTION 12.   GENERAL PROVISIONS.

        (a)   The Board or the Committee, as the case may be, may require each
              person acquiring shares of Stock pursuant to an Option or other
              award under the Plan to represent to and agree with the Company in
              writing that the optionee or participant is acquiring the shares
              for investment without a view to distribution thereof. All
              certificates for shares of Stock delivered under the Plan shall be
              subject to such stop transfer orders and other restrictions as the
              Board or the Committee, as the case may be, may deem to be
              advisable under the rules, regulations, and other requirements of
              the Securities and Exchange Commission, any stock exchange or
              association upon which the Stock is then listed or traded, any
              applicable Federal or state securities law, and any applicable
              corporate law, and the Board or the Committee, as the case may be,
              may cause a legend or legends to be put on any such certificates
              to make appropriate reference to such restrictions.

        (b)   Nothing contained in the Plan shall prevent the Board from
              adopting such other or additional incentive arrangements as it may
              deem desirable, including, but not limited to, the granting of
              stock options and the awarding of stock and cash otherwise than
              under the Plan; and such arrangements may be either generally
              applicable or applicable only in specific cases.

                                      -12-
<PAGE>

        (c)   Nothing contained in the Plan or in any award hereunder shall be
              deemed to confer upon any employee of the Company or any Parent or
              Subsidiary any right to continued employment with the Company or
              any Parent or Subsidiary, nor shall it interfere in any way with
              the right of the Company or any Parent or Subsidiary to terminate
              the employment of any of its employees at any time.

        (d)   No later than the date as of which an amount first becomes
              includable in the gross income of the participant for Federal
              income tax purposes with respect to any Option or other award
              under the Plan, the participant shall pay to the Company, or make
              arrangements satisfactory to the Board or the Committee, as the
              case may be, regarding the payment of, any Federal, state and
              local taxes of any kind required by law to be withheld or paid
              with respect to such amount. If permitted by the Board or the
              Committee, as the case may be, tax withholding or payment
              obligations may be settled with Stock, including Stock that is
              part of the award that gives rise to the withholding requirement.
              The obligations of the Company under the Plan shall be conditional
              upon such payment or arrangements, and the Company or the
              participant's employer (if not the Company) shall, to the extent
              permitted by law, have the right to deduct any such taxes from any
              payment of any kind otherwise due to the participant from the
              Company or any Parent or Subsidiary.

        (e)   The Plan and all awards made and actions taken thereunder shall be
              governed by and construed in accordance with the laws of the State
              of Delaware (without regard to choice of law provisions).

        (f)   Any Stock Option granted or other award made under the Plan shall
              not be deemed compensation for purposes of computing benefits
              under any retirement plan of the Company or any Parent or
              Subsidiary and shall not affect any benefits under any other
              benefit plan now or subsequently in effect under which the
              availability or amount of benefits is related to the level of
              compensation (unless required by specific reference in any such
              other plan to awards under the Plan).

        (g)   A leave of absence, unless otherwise determined by the Board or
              Committee, as the case may be, prior to the commencement thereof,
              shall not be considered a termination of employment. Any Stock
              Option granted or awards made under the Plan shall not be affected
              by any change of employment, so long as the holder continues to be
              an employee of the Company or any Parent or Subsidiary.

        (h)   Except as otherwise expressly provided in the Plan or in any Stock
              Option agreement, Restricted Stock agreement, Deferred Stock
              agreement or any Other Stock-Based Award agreement, no right or
              benefit under the Plan may be alienated, sold, assigned,
              hypothecated, pledged, exchanged, transferred, encumbered or
              charged, and any attempt to alienate, sell, assign, hypothecate,
              pledge, exchange, transfer, encumber or charge the same shall be
              void. No right or benefit hereunder shall in any manner be subject
              to the debts, contracts or liabilities of the person entitled to
              such benefit.

        (i)   The obligations of the Company with respect to all Stock Options
              and awards under the Plan shall be subject to (A) all applicable
              laws, rules and regulations, and such approvals by any
              governmental agencies as may be required, including, without
              limitation, the effectiveness of a registration statement under
              the Securities Act, and (B) the rules and regulations of any
              securities exchange or association on which the Stock may be
              listed or traded.

                                      -13-
<PAGE>

        (j)   If any of the terms or provisions of the Plan conflicts with the
              requirements of Rule 16b-3 as in effect from time to time, or with
              the requirements of any other applicable law, rule or regulation,
              and with respect to Incentive Stock Options, Section 422 of the
              Code, then such terms or provisions shall be deemed inoperative to
              the extent they so conflict with the requirements of said Rule
              16b-3, and with respect to Incentive Stock Options, Section 422 of
              the Code. With respect to Incentive Stock Options, if the Plan
              does not contain any provision required to be included herein
              under Section 422 of the Code, such provision shall be deemed to
              be incorporated herein with the same force and effect as if such
              provision had been set out at length herein.

        (k)   The Board or the Committee, as the case may be, may terminate any
              Stock Option or other award made under the Plan if a written
              agreement relating thereto is not executed and returned to the
              Company within 30 days after such agreement has been delivered to
              the optionee or participant for his or her execution.

        (l)   The grant of awards pursuant to the Plan shall not in any way
              affect the right or power of the Company to make
              reclassifications, reorganizations or other changes of or to its
              capital or business structure or to merge, consolidate, liquidate,
              sell or otherwise dispose of all or any part of its business or
              assets.

SECTION 13.   EFFECTIVE DATE OF PLAN.

         The Plan shall be adopted and effective as of the date of the approval
and adoption thereof at a meeting of the shareholders of the Company.

SECTION 14.   TERM OF PLAN.

         No Stock Option, Restricted Stock Award, Deferred Stock award or Other
Stock-Based Award shall be granted pursuant to the Plan on or after the tenth
anniversary of the effective date of the Plan, but awards granted on or prior to
such tenth anniversary may extend beyond that date.

                                      -14-Form of Rights Certificate

 

Exhibit 4.3

 

Form of Rights Certificate

 

	
 

Certificate No. R-

 
	
 

___________ Rights

 

 

NOT EXERCISABLE AFTER THE EARLIER OF MAY 25, 2014, AND THE DATE ON WHICH THE RIGHTS EVIDENCED HEREBY ARE REDEEMED OR EXCHANGED BY THE COMPANY AS SET FORTH IN THE RIGHTS AGREEMENT. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $0.001 PER RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO IS, WAS OR BECOMES AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT), WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT HOLDER, MAY BE NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR AN ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BE OR MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(d) OF THE RIGHTS AGREEMENT.)]1 

 

RIGHTS CERTIFICATE

 

JAMES RIVER COAL COMPANY

 

This Rights Certificate certifies that __________________________, or registered assigns, is the registered holder of the number of Rights set forth above, each of which entitles the holder (upon the terms and subject to the conditions set forth in the Rights Agreement, dated as of May 25, 2004 (the "Rights Agreement"), between James River Coal Company, a Virginia corporation (the “Company"), and SunTrust Bank (the "Rights Agent”)), to purchase from the Company, at any time after the Distribution Date (as such term is defined in the Rights Agreement) and prior to the Expiration Date (as such term is defined in the Rights Agreement), one one-hundredth{s} of a fully paid, non-assessable share of Series A Participating Cumulative Preferred Stock (the "Preferred Stock") of the Company, at a purchase price of $200.00 per one one-hundredth of a share (the "Purchase Price"), payable in lawful money of the United States of America, upon surrender of this Rights Certificate, with the form of election to purchase and related certificate duly executed, and payment of the Purchase Price at an office of the Rights Agent designated for such purpose.

 

Terms used herein and not otherwise defined herein have the meanings assigned to them in the Rights Agreement.

 

____________________

1    If applicable, insert this portion of the legend and delete the preceding sentence.

	 
	 	 	 
	

	 

The number of Rights evidenced by this Rights Certificate (and the number and kind of shares issuable upon exercise of each Right) and the Purchase Price set forth above are as of May 25, 2004, and may have been or in the future may be adjusted as a result of the occurrence of certain events, as more fully provided in the Rights Agreement.

 

Upon the occurrence of a Flip-in Event, if the Rights evidenced by this Rights Certificate are beneficially owned by (a) an Acquiring Person or an Associate or Affiliate of an Acquiring Person, (b) a transferee of an Acquiring Person (or any such Associate or Affiliate) who becomes a transferee after the Acquiring Person becomes such, or (c) under certain circumstances specified in the Rights Agreement, a transferee of an Acquiring Person (or any such Associate or Affiliate) who becomes a transferee prior to or concurrently with the Acquiring Person becoming such, such Rights shall become null and void, and no holder hereof shall have any right with respect to such Rights from and after the occurrence of such Flip-in Event.

 

This Right Certificate is subject to all of the terms, provisions and conditions of the Rights Agreement, which terms, provisions and conditions are hereby incorporated herein by reference and made a part hereof and to which Rights Agreement reference is hereby made for a full description of the rights, limitations of rights, obligations, duties and immunities hereunder of the Rights Agent, the Company and the holders of the Rights Certificates, which limitations of rights include the temporary suspension of the exercisability of such Rights under the specific circumstances set forth in the Rights Agreement. Copies of the Rights Agreement are on file at the office of the Company and are also available upon written request to the Company.

 

Upon surrender at the principal office or offices of the Rights Agent designated for such purpose and subject to the terms and conditions set forth in the Rights Agreement, any Rights Certificate(s) may be transferred or exchanged for another Rights Certificate(s) evidencing a like number of Rights as the Rights Certificate(s) surrendered. If this Rights Certificate shall be exercised in part, the holder shall be entitled to receive upon surrender hereof another Rights Certificate(s) for the number of whole Rights not exercised.

 

Subject to the provisions of the Rights Agreement, the Board of Directors of the Company may, at its option,

 

(a)       at any time prior to the earlier of (i) the Close of Business on the day that is ten (10) calendar days after Share Acquisition Date and (ii) the Final Expiration Date, redeem all but not less than all the then outstanding Rights at a redemption price of $0.001 per Right; or

 

(b)       at any time after any Person becomes an Acquiring Person, exchange all or part of the then outstanding Rights (other than Rights held by the Acquiring Person and certain related Persons) for shares of Common Stock at an exchange ratio of one share of Common Stock per Right. If the Rights shall be exchanged in part, the holder of this Rights Certificate shall be entitled to receive upon surrender hereof another Rights Certificate(s) for the number of whole Rights not exchanged.

 

 

	 
	 	 	 
	

	 

After the expiration of the redemption period, the Companies right of redemption may be reinstated if an Acquiring Person reduces his beneficial ownership to ten percent (10%) or less of the outstanding shares of Common Stock in a transaction or series of transactions not involving the Company and there is no other Acquiring Person.

 

No fractional shares of Preferred Stock are required to be issued upon the exercise of any Right(s) evidenced hereby (other than fractions which are multiples of one one-hundredth of a share of Preferred Stock, which may, at the election of the Company, be evidenced by depository receipts), but in lieu thereof a cash payment will be made, as provided in the Rights Agreement.

 

No holder of this Rights Certificate shall be entitled to vote, receive dividends or be deemed for any purpose the holder of the shares of capital stock which may at any time be issuable on the exercise hereof, nor shall anything contained in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the rights of a shareholder of the Company or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders (except as provided in the Rights Agreement), or to receive dividends or subscription rights, or otherwise, until the Right(s) evidenced by this Rights Certificate shall have been exercised as provided in the Rights Agreement.

 

This Rights Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned by the Rights Agent.

 

 

 

 

	 
	 	 	 
	

	 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal by its authorized officers.

 

 

	 	 	 
	 	JAMES RIVER COAL COMPANY
	 
 	 
 	 
 
	Dated as of _________________, ____	By:  	
	 	

Title 

 

	
(SEAL)

	 
	
Attest:

 

_________________________________

Secretary

	 
	
Countersigned:

 

_________________________________

, as Rights Agent

	 
	
By:______________________________

Authorized Signature

	 

  

	 	 	 
	

	 

 

 

Form of Reverse Side of Rights Certificate

 

FORM OF ASSIGNMENT

 

(To be executed if the registered holder

desires to transfer the Rights Certificate.)

 

 

FOR VALUE RECEIVED

                                        

hereby sells, assigns and transfers unto 

 

(Please print name and address of transferee)

 

this Rights Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint _______________________ Attorney, to transfer the within Rights Certificate on the books of the within-named Company, with full power of substitution.

	
Dated:_______________________________  
	______________________________
	 	
Signature

 

Signature Guaranteed:

 

	 

  

	 	 	 
	

	 

 

Certificate

 

 

The undersigned hereby certifies by checking the appropriate boxes that:

 

(1)  the Rights evidenced by this Rights Certificate ___ are ___ are not being assigned by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such Acquiring Person (as such terms are defined in the Rights Agreement);

 

(2)  after due inquiry and to the best knowledge of the undersigned, it ___ did ___ did not acquire the Rights evidenced by this Rights Certificate from any Person who is, was or became an Acquiring Person or an Affiliate or Associate of an Acquiring person.

 

 

	
Dated:_______________________________  
	______________________________
	 	
Signature

 

 

NOTICE

 

The signatures to the foregoing Assignment and Certificate must correspond to the name as written upon the face of this Rights Certificate in every particular, without alteration or enlargement or any change whatsoever.

 

	 

  

	 	 	 
	

	 

 

___________________

 

FORM OF ELECTION TO PURCHASE

 

(To be executed if the registered holder desires to exercise Rights represented by the Rights Certificate.)

 

To:     James River Coal Company

 

The undersigned hereby irrevocably elects to exercise ______________ Rights represented by this Rights Certificate to purchase shares of Preferred Stock issuable upon the exercise of the Rights (or such other securities of the Company or of any other Person which may be issuable upon the exercise of the Rights) and requests that certificates for such securities be issued in the name of and delivered to:

 

Please insert social security

or other identifying number

 

(Please print name and address)

 

 

If such number of Rights shall not be all the Rights evidenced by this Rights Certificate, a new Rights Certificate for the balance of such Rights shall be registered in the name of and delivered to:

 

 

 

Please insert social security 

or other identifying number

_____________________________________________

        (Please print name and address)

 

_____________________________________________

 

Dated: ____________________, _______

 

                ______________________________

                Signature

 

Signature Guaranteed

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