Document:

Form of Change of Control Agreement

 Exhibit 10.1 
  
 CHANGE OF CONTROL AGREEMENT 
  
 THIS CHANGE OF CONTROL AGREEMENT (this “Agreement”) is dated as of January 17, 2005 between Penn Engineering & Manufacturing Corp. (together
with its successors or assigns as permitted under this Agreement, the “Company”) and
                                 (the “Employee”). 
  
 W I T N E S S E T H: 
  
 WHEREAS, the Board of Directors of the Company (the “Board”)
recognizes that a change in control of the Company will give rise to uncertainty and questions among management and could result in the departure of key management personnel prior to a change of control that would be to the detriment of the Company
and its stockholders; 
  
 WHEREAS, the Board has determined that
appropriate steps should be taken to reinforce and encourage the retention of certain members of the Company’s management, including the Employee, in their assigned positions without distraction in the face of potentially disturbing
circumstances arising from a change in control of the Company; and 
  
 WHEREAS, in order to induce the Employee to remain in the employ of the Company and in consideration of the Employee’s undertakings set forth herein, the Company agrees that Employee shall receive the change of control benefits set
forth in this Agreement under the circumstances described in this Agreement. 
  
 NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein and for other good and valuable consideration, the Company and the Employee, intending to be legally bound hereby, agree as
follows: 
  
 1. Definitions. 
  
 (a) “Base Salary” shall mean the Employee’s annual base
salary payable by the Company as in effect on the date of a Change of Control. 
  
 (b) “Board” shall mean the Board of Directors of the Company. 
  
 (c) “Cause” shall mean any of the following grounds for termination of the Employee’s employment: 
  
 (i) The Employee is convicted of a crime involving moral turpitude;

  
 (ii) The Employee willfully refuses or fails to perform his
material duties for the Company, other than a failure resulting from the Employee’s incapacity due to physical or mental illness, which refusal or failure has continued for a period of at least 30 days after a written notice of demand for
substantial performance, 

 signed by a duly authorized officer of the Company, has been delivered to the Employee specifying the manner in which the
Employee has refused or failed substantially to perform; or 
  
 (iii) The Employee engages in gross misconduct in the performance of his duties that is materially injurious to the Company, whether monetarily or otherwise. 
  
 For purposes of clauses (ii) and (iii) of this definition, (x) no act or failure to act on the Employee’s part shall constitute grounds
for termination for Cause unless done, or omitted to be done, by the Employee not in good faith and without the Employee’s reasonable belief that his act, or failure to act, was in the best interests of the Company and (y) in the event of a
dispute concerning the application of this provision, no claim by the Company that Cause exists shall be given effect unless the Company establishes to the Board by clear and convincing evidence that Cause exists. 
  
 (d) “Change of Control” shall mean the first to occur of one of the
following: 
  
 (i) any “person”, as such term is used
in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934 as amended (the “Exchange Act”), other than the Company or any trustee or other fiduciary holding securities of the Company, any person acquiring securities from the
Company solely pursuant to a written agreement with the Company, or any corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock in the Company, is or becomes the
“beneficial owner”, as defined in Rule 13d-3 under the Exchange Act, directly or indirectly, of securities of the Company representing 80% or more of the combined voting power of the Company’s then outstanding voting securities;

  
 (ii) during any period of two consecutive years commencing
the day after the date of this Agreement, individuals who at the beginning of such period constitute the Board and any new director, other than a director whose nomination by the Board was approved by a vote of at least two-thirds of the directors
then still in office who either were directors at the beginning of such period or whose nomination for election was previously so approved, cease for any reason to constitute at least a majority of the members of the Board; 
  
 (iii) the consummation of a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation where no person within the meaning of subsection (i) above becomes the “beneficial owner” (as defined above) of 55% or more of the resulting voting power and where the voting
securities of the Company outstanding immediately prior thereto continue to represent, either by remaining outstanding or by being converted into voting securities of the surviving or controlling entity, more than 55% of the combined voting power of
the voting securities of the Company or such surviving or controlling entity outstanding immediately after such merger or consolidation; or 

 (iv) the stockholders of the Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets. 
  
 (e) “Code” shall mean the Internal Revenue Code of 1986, as amended. 
  
 (f) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. 
  
 2. Compensation Payable in the Event of a Change of Control.

  
 (a) In the event of a Change of Control, the Employee shall
be entitled to receive the following payments and benefits from the Company on the date on which the Change of Control is consummated, provided that the Employee has executed and not revoked a general release substantially in the form attached to
this Agreement as Exhibit A: 
  
 The Employee shall receive a lump-sum payment
equal to [                    ] plus: 
  
 (i) Reimbursement for out-of-pocket business expenses properly incurred and documented but not yet reimbursed by the Company; and 
  
 (ii) Any other amounts earned, accrued or owing but not yet paid and any
other benefits in accordance with the terms of any applicable plans and programs of the Company; provided, however, that the benefits provided under this Section 2 shall be in lieu of and shall replace any severance benefits due or that may be
provided based on termination of the Employee’s employment upon a Change of Control or thereafter under any severance plan, policy or other agreement of the Company. Employee also waives any right to receive any amounts under the Company’s
2005 Management Incentive Plan in the event that Employee terminates his employment with the Company for any reason, including retirement, prior to December 1, 2005. 
  
 (b) All stock options with respect to stock of the Company that are then held by the Employee shall become fully vested and
exercisable as of the date of the Change of Control. 
  
 (c)
Notwithstanding the foregoing, if the Employee’s employment terminates on account of disability within 180 days prior to the occurrence of a Change of Control, any benefits payable pursuant to this Section 2 shall be reduced by any disability
benefits received by the Employee under any long-term disability plan maintained by the Company. 
  
 3. Termination for Cause or Death; No Resignation. The Employee shall not be entitled to the benefits provided in Sections 2 or 14 if the
Employee’s employment terminates for Cause, or due to the death, or resignation of the Employee prior to the occurrence of a Change of Control. 

 4. Confidential Information. The Employee recognizes and acknowledges that, by reason of the
Employee’s employment by and service to the Company during and, if applicable, after the Change of Control, the Employee will continue to have access to certain confidential and proprietary information relating to the business of the Company,
which may include, but is not limited to, trade secrets, trade “know-how,” customer information, supplier information, cost and pricing information, marketing and sales techniques, strategies and programs, computer programs and software
and financial information (collectively referred to as “Confidential Information”). The Employee acknowledges that such Confidential Information is a valuable and unique asset of the Company and the Employee covenants that the Employee
will not, unless expressly authorized in writing by the Board, at any time during the course of the Employee’s employment, use any Confidential Information or divulge or disclose any Confidential Information to any person, firm or corporation
except in connection with the performance of the Employee’s duties for the Company and in a manner consistent with the Company’s policies regarding Confidential Information. The Employee also covenants that at any time after the
termination of such employment, the Employee will not use any Confidential Information or divulge or disclose any Confidential Information to any person, firm or corporation, unless such information is in the public domain through no fault of the
Employee or except when required to do so by law or legal process, in which case the Employee will inform the Company in writing promptly of such required disclosure, but in any event at least two business days prior to disclosure. All written
Confidential Information including, without limitation, in any computer or other electronic format that comes into the Employee’s possession during the course of the Employee’s employment shall remain the property of the Company. Except as
required in the performance of the Employee’s duties for the Company, or unless expressly authorized in writing by the Board, the Employee shall not remove any written Confidential Information from the Company’s premises, except in
connection with the performance of the Employee’s duties for the Company and in a manner consistent with the Company’s policies regarding Confidential Information. Upon termination of the Employee’s employment, the Employee agrees to
return to the Company immediately all written Confidential Information in the Employee’s possession. For the purposes of this Section 4, the term “Company” shall be deemed to include the Company, its subsidiaries and their successors.

  
 5. Non-Competition; Non-Solicitation. 
  
 (a) During the Employee’s employment by the Company and for a period
equal to the longer of (i) twelve months after the occurrence of a Change of Control or (ii) twelve months after the termination of the Employee’s employment, the Employee will not, except with the prior written consent of the Board, directly
or indirectly, own, manage, operate, join, control, finance or participate in the ownership, management, operation, control or financing of, or be connected as an officer, director, employee, partner, principal, agent, representative, consultant or
otherwise with, or use or permit the Employee’s name to be used in connection with, any business or enterprise that is engaged in any business that is competitive with any business or enterprise in which the Company is engaged during the
Employee’s employment or, with respect to the application of this covenant after the termination of the Employee’s employment, at the date of the 

 Employee’s termination of employment. Based upon the Company’s current and anticipated programs, competition
with the Company shall be understood to be managing, advising on or engaging in the research, discovery, development, manufacture, application or delivery of any product currently manufactured or distributed by the Company or whose development for
manufacture or distribution has been commenced by the Company. 
  
 (b) The foregoing restrictions shall not be construed to prohibit the ownership by the Employee of less than 5% of any class of securities of any corporation that is engaged in any of the foregoing businesses having a class of securities
registered pursuant to the Exchange Act, provided that such ownership represents a passive investment and that neither the Employee nor any group of persons including the Employee in any way, either directly or indirectly, manages or exercises
control of any such corporation, guarantees any of its financial obligations, otherwise takes any part in its business, other than exercising the Employee’s rights as a shareholder, or seeks to do any of the foregoing. 
  
 (c) The Employee further covenants and agrees that during the Employee’s
employment by the Company and for a period of twelve months after the later to occur of the occurrence of a Change of Control or the termination of the Employee’s employment, the Employee will not, except with the prior written consent of the
Board, directly or indirectly, solicit or hire, or encourage the solicitation or hiring of, any person who was a managerial or higher level employee of the Company at any time during the term of the Employee’s employment by the Company by any
employer other than the Company for any position as an employee, independent contractor, consultant or otherwise. The foregoing covenant of the Employee shall not apply to any person after twelve months have elapsed after the date on which a Change
of Control has occurred. 
  
 (d) For the purposes of this Section
5, the term “Company” shall be deemed to include the Company, its subsidiaries and their successors. 
  
 6. Equitable Relief. 
  
 (a) The Employee acknowledges and agrees that the restrictions contained in Sections 4 and 5 are reasonable and necessary to protect and preserve the
legitimate interests, properties, goodwill and business of the Company, that the Company would not have entered into this Agreement in the absence of such restrictions and that irreparable injury will be suffered by the Company should the Employee
breach any of the provisions of those Sections 4 or 5. The Employee represents and acknowledges that (i) the Employee has been advised by the Company to consult the Employee’s own legal counsel in respect of this Agreement, and (ii) the
Employee has had full opportunity, prior to execution of this Agreement, to review thoroughly this Agreement with the Employee’s counsel. 
  
 (b) The Employee further acknowledges and agrees that a breach of any of the restrictions in Sections 4 and 5 cannot be adequately compensated by monetary
damages. The Employee agrees that the Company shall be entitled to preliminary and 

 permanent injunctive relief, without the necessity of proving actual damages, as well as an equitable accounting of all
earnings, profits and other benefits arising from any violation of Sections 4 or 5, which rights shall be cumulative and in addition to any other rights or remedies to which the Company may be entitled. In the event that any of the provisions of
Sections 4 or 5 should ever be adjudicated to exceed the time, geographic, service or other limitations permitted by applicable law in any jurisdiction, it is the intention of the parties that the provision shall be amended to the extent of the
maximum time, geographic, service or other limitations permitted by applicable law, that such amendment shall apply only within the jurisdiction of the court that made such adjudication and that the provision otherwise be enforced to the maximum
extent permitted by law. 
  
 (c) The Employee irrevocably and
unconditionally (i) agrees that any suit, action or other legal proceeding arising out of Sections 4 or 5, including, without limitation, any action commenced by the Company for preliminary and permanent injunctive relief and other equitable relief,
may be brought in a United States District Court in Philadelphia, Pennsylvania, or if such court does not have jurisdiction or will not accept jurisdiction, in any court of general jurisdiction in Philadelphia or Bucks County, Pennsylvania, (ii)
consents to the non-exclusive jurisdiction of any such court in any such suit, action or proceeding, and (iii) waives any objection that the Employee may have to the laying of venue of any such suit, action or proceeding in any such court. The
Employee also irrevocably and unconditionally consents to the service of any process, pleadings, notices, or other papers in a manner permitted by the provisions of Section 15. 
  
 (d) For the purposes of this Section 6 the term “Company” shall be deemed to include the Company, its subsidiaries
and their successors. 
  
 7. Indemnification. The Company
shall indemnify the Employee with respect to his actions in the performance of his duties to the Company to the fullest extent permitted by the Company’s bylaws as in effect from time to time. 
  
 8. No Mitigation, No Offset. In the event of any termination of the
Employee’s employment after a Change of Control, the Employee shall be under no obligation to seek other employment, and there shall be no offset against amounts due the Employee under this Agreement on account of any remuneration attributable
to any subsequent employment that the Employee may obtain. 
  
 9.
Representation. The Company and the Employee respectively represent and warrant to each other that each is fully authorized and empowered to enter into this Agreement and that its or his entering into this Agreement and the performance of its
or his respective obligations under this Agreement will not violate any agreement between the Company or the Employee and any other person, firm or organization or any law or governmental regulation. 
  
 10. Entire Agreement. This Agreement contains the entire agreement
between the parties concerning the subject matter hereof and supersedes all prior agreements, understandings, discussions, negotiations and undertakings, whether written or oral, between the parties with respect thereto. 

 11. Amendment or Waiver. This Agreement cannot be changed, modified or amended without the consent
in writing of both the Employee and the Company. No waiver by either party at any time of any breach by the other party of any condition or provision of this Agreement shall be deemed a waiver of a similar or dissimilar condition or provision at the
same or at any prior or subsequent time. Any waiver must be in writing and signed by the Employee or an authorized officer of the Company, as the case may be. 
  

12. Severability. In the event that any provision or portion of this Agreement shall be determined to be invalid or unenforceable for any
reason, in whole or in part, the remaining provisions of this Agreement shall be unaffected thereby and shall remain in full force and effect to the fullest extent permitted by law. 
  
 13. Governing Law. This Agreement shall be governed by and construed and interpreted in accordance with the laws of
the State of Delaware without reference to principles of conflict of laws. 
  
 14. Legal Fees. It is the intent of the parties that the Employee not be required to incur any expenses associated with the enforcement of his rights under this Agreement by litigation or other legal action.
Accordingly, the Company agrees to pay as incurred, to the full extent permitted by law, all expenses, including all reasonable attorneys’ fees and legal expenses, that the Employee may reasonably incur as a result of any contest, regardless of
the outcome thereof, by the Company, the Employee or others concerning the validity or enforceability of, or liability under, any provision of this Agreement, regardless of whether such contest is between the Company and the Employee or between
either of them and a third party. 
  
 15. Notices. Any
notice given to either party shall be in writing and shall be deemed to have been given when delivered personally or sent by certified or registered mail, postage prepaid, return receipt requested, duly addressed to such party concerned at the
address indicated below or to such changed address as such party may subsequently give notice of: 
  
 If to the Company: 
  
 Penn Engineering & Manufacturing Corp. 
 5190 Old Easton Road 
 Danboro, PA 18916 
 Attention: Chief Executive Officer 
  
 If to the Employee: 
  
 [Insert Employee’s name 
 and home address] 
  
 16.
Withholding Taxes. All payments under this Agreement shall be made subject to applicable tax withholding, and the Company shall withhold from any payments under this Agreement all such federal, state and local taxes as the Company is required
to withhold pursuant to any law or governmental rule or regulation. 

 17. Headings. The headings of the Sections contained in this Agreement are for convenience of
reference only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof. 
  
 18. Counterparts. This Agreement may be executed in two or more counterparts. 
  
 IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above. 
  

			
	Penn Engineering & Manufacturing Corp.
		
	By:	 	  

	 	 	 Kenneth A Swanstrom, Chairman and
 Chief Executive Officer

  

	
	  

	Employee
	
	  

	Signature
	
	  

	Date

 Exhibit A 
  

RELEASE AGREEMENT 
  
 This Release Agreement (this “Release”) is entered into as of this     day of
            , 2005 by and between [Name of Employee] (hereinafter “you”), and Penn Engineering & Manufacturing Corp. and its successors and assigns (hereinafter,
the “Company”). 
  

	1.	The Company agrees to provide you the special payment provided for in your letter agreement with the Company, dated as of [Insert Date, 2005] (the “Agreement”), after you
execute this Release and this Release becomes effective pursuant to its terms and provided that you do not revoke it as may be permitted in this Release. 

  

	2.	In consideration of the benefits described in Section 1, you, on behalf of yourself, and your heirs, executors, successors, and assigns, hereby fully and forever release the Company
and its direct or indirect subsidiaries, and their respective stockholders, partners, directors, officers, affiliates, employees, independent contractors, trustees, administrators, consultants, attorneys, agents, representatives and fiduciaries,
predecessor and successor entities and assigns from any claim, charge, complaint, cause of action or demand (each, a “Claim) relating to any matters of any kind, whether known or unknown, suspected or unsuspected, that you may possess relating
to or arising from any omissions, acts or facts that have occurred up until and including the effective date of this Release including, without limitation: 

  
 (a) any and all Claims relating to or arising from your employment relationship with the Company and, if applicable,
termination of that relationship, whether in connection with the Merger (as defined in the Agreement) or thereafter; 
  
 (b) any and all Claims for wrongful discharge of employment; breach of contract, both express and implied; breach of a covenant of good faith and fair
dealing, both express and implied; negligent or intentional infliction of emotional distress; negligent or intentional misrepresentation; negligent or intentional interference with contract or prospective economic advantage; and defamation;

  
 (c) any and all Claims for violation of any federal, state or
municipal statute, including, but not limited to, Title VII of the Civil Rights Act of 1964; 
  
 (d) any and all Claims arising out of any other laws and regulations relating to employment or employment discrimination; and 
  

(e) any and all Claims for attorneys’ fees and costs. 

 The release set forth in this Section 2 specifically excludes Claims that (a) involve rights to benefits
in which you are vested as of the date of your termination of employment under any pension plans of the Company, or (b) involve obligations owed to you by the Company under the Agreement, subject to the effectiveness of this Release. 
  

	3.	[This paragraph will be included only if you are 40 years of age or older] As provided under the Age Discrimination in Employment Act of 1967, as amended, you have 21 days
after receipt of this Release to review and consider it, discuss it with an attorney of your choosing, and decide whether to execute it. For a period of seven days after you sign this Release, you may revoke the release contained herein and the
release contained herein will not become effective until seven days after this Release is executed by you (and only then if not revoked by you). In order to revoke the release contained herein, you must deliver to the Chief Executive Officer of the
Company by no later than seven days after this Release is executed by you, a letter stating that you are revoking it. If you revoke the release contained herein, the Company’s obligations to you hereunder to make the payment described in
Section 1 shall become null and void. You specifically agree and acknowledge that the Release was granted in exchange for the receipt of consideration that exceeds the amount to which you would otherwise be entitled to receive upon termination of
your employment or otherwise. 

  

	4.	If any provision of this Release is held invalid, the invalidity of such provision shall not affect any other provisions of this Release. This Release is governed by, and construed
and interpreted in accordance with the laws of the State of Delaware, without regard to principles of conflicts of law. You consent to venue and personal jurisdiction in the Commonwealth of Pennsylvania for disputes arising under this Release. This
Release represents the entire understanding between you and the Company with respect to subject matter herein, and no other inducements or representations have been made or relied upon by the you and the Company. This Release shall be binding upon
and inure to the benefit of you, your heirs and legal representatives, and the Company and its successors as provided in this Section 4. Any modification of this Release must be made in writing and be signed by you and the Company.

			
	ACCEPTED AND AGREED TO:
	
	  

	[Name of Employee]
	Dated:	 	 
	
	Penn Engineering & Manufacturing Corp.
		
	By:	 	  

	Name:	 	 
	Title:	 	 
	Dated:Neogen Corporation 1997 Stock Option Plan, as amended

  
 EXHIBIT 4.3

  
 NEOGEN CORPORATION 1997 STOCK OPTION PLAN, AS AMENDED

  
 NEOGEN CORPORATION 
 1997 STOCK OPTION PLAN, AS AMENDED 
  
 1. Definitions: As used herein, the following terms shall have the following meanings: 
  
 (a) “Code” shall mean the Internal Revenue Code of 1986, as amended, and the applicable rules and
regulations thereunder. 
  
 (b)
“Committee” shall mean, (i) with respect to administration of the Plan regarding Participants who are subject to Section 16(a) and (b) of the Exchange Act, a committee meeting the standards of Rule 16b-3 of the Rules and Regulations under
the Exchange Act, or any similar successor rule, appointed by the Board of Directors of the Company to perform any of the functions and duties of the Committee under the Plan, or the Board of Directors as a whole, and (ii) with respect to
administration of the Plan regarding all other Participants, such committee or the Board of Directors of the Company, as described in clause (i), or such other committee or entity appointed by the Board of Directors of the Company to perform any of
the functions and duties of the Committee under the Plan. 
  
 (c) “Common Shares” shall mean the Common Shares, $.16 par value, of the Company. 
  
 (d) “Company” shall mean Neogen Corporation, a Michigan corporation, or any successor thereof. 
  
 (e) “Discretion” shall mean the sole discretion of
the Committee, with no requirement whatsoever that the Committee follow past practices, act in a manner consistent with past practices, or treat any key employee, director, or SRC member in a manner consistent with the treatment afforded other key
employees, directors, or SRC members with respect to the Plan or otherwise. 
  
 (f) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder. 
  
 (g) “Incentive Option” shall mean an option to purchase Common Shares which meets the requirements
set forth in the Plan and also is intended to be, and qualifies as, an incentive stock option within the meaning of Section 422 of the Code. 
  
 (h) “Nonqualified Option” shall mean an option to purchase Common Shares which meets the requirements set forth in the Plan but
is not intended to be, or does not qualify as, an incentive stock option within the meaning of the Code. 
  
 (i) “Participant” shall mean any individual covered by Paragraph 11 or designated by the Committee under Paragraph 6 for
participation in the Plan. 
  
 (j)
“Plan” shall mean this Neogen Corporation 1997 Stock Option Plan. 
  
 (k) “Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations thereunder. 
  
 (l) “Subsidiary” shall mean any corporation or other entity in which the Company 

  

 Page 8 of 18 Pages 

 
has a direct or indirect ownership interest of 50% or more of the total combined voting power of all classes of outstanding voting equity interests.

  
 (m) “Outside Director” shall mean
any member of the Company’s Board of Directors who is not an employee of Neogen Corporation or any of its Subsidiaries. 
  
 (n) “SRC member” shall mean any member of the Company’s Scientific Review Council who is not an employee of Neogen
Corporation or any of its Subsidiaries. 
  
 2. Purpose of Plan:
The purpose of the Plan is to provide key employees (including officers), directors, and SRC members of the Company and its Subsidiaries (collectively, “key employees”) with an increased incentive to make significant and extraordinary
contributions to the long-term performance and growth of the Company and its Subsidiaries, to join the interests of key employees, directors, and SRC members with the interests of the shareholders of the Company, and to facilitate attracting and
retaining key employees, directors, and SRC members of exceptional ability. 
  
 3. Administration: The Plan shall be administered by the Committee. Subject to the provisions of the Plan, the Committee shall determine, from those eligible to be Participants under the Plan, the persons to be
granted stock options, the amount of stock to be optioned to each such person, the time such options shall be granted and the terms and conditions of any stock options. Such terms and conditions may, in the Committee’s Discretion, include,
without limitation, provisions providing for termination of the option, forfeiture of the gain on any option exercises or both if the Participant competes with the Company or otherwise acts contrary to the Company’s interests, and provisions
imposing restrictions, potential forfeiture or both on shares acquired upon exercise of options granted pursuant to this Plan. The Committee may condition any grant on the potential Participant’s agreement to such terms and conditions.

  
 Subject to the provisions of the Plan, the Committee is
authorized to interpret the Plan, to promulgate, amend and rescind rules and regulations relating to the Plan and to make all other determinations necessary or advisable for its administration. Interpretation and construction of any provision of the
Plan by the Committee shall, unless otherwise determined by the Board of Directors of the Company, be final and conclusive. A majority of the Committee shall constitute a quorum, and the acts of a majority of the members present at any meeting at
which a quorum is present, or acts approved in writing by a majority of the Committee, shall be the acts of the Committee. 
  
 4. Indemnification: In addition to such other rights of indemnification as they may have, the members of the Committee shall be indemnified by the Company
in connection with any claim, action, suit or proceeding relating to any action taken or failure to act under or in connection with the Plan or any option granted hereunder to the full extent provided for under the Company’s articles of
incorporation or bylaws with respect to indemnification of directors of the Company. 
  
 5. Maximum Number of Shares Subject to Plan: The maximum number of shares with respect to which stock options may be granted under the Plan shall be an aggregate of 2,750,000 Common Shares (calculated taking into
account the 5-for-4 stock split paid as a 25% stock dividend on January 2, 2004), which may consist in whole or in part of authorized and unissued or reacquired Common Shares. Unless the Plan shall have been terminated, shares covered by the
unexercised portion of canceled, expired or otherwise terminated options under the Plan shall again be available for option and sale. 
  
 Subject to Paragraph 17, the number and type of shares subject to each outstanding stock option, the option price with respect to outstanding stock
options, the aggregate number and type of shares remaining available under the Plan, and the maximum number and type of shares that may be granted to any Participant in any fiscal year of the Company pursuant to Paragraph 6, shall be subject to such
adjustment as the Committee, in its Discretion, deems appropriate to reflect such events as stock 

  

 Pages 9 of 18 Pages 

 
dividends, stock splits, recapitalizations, mergers, statutory share exchanges or reorganizations of or by the Company; provided that no fractional shares
shall be issued pursuant to the Plan, no rights may be granted under the Plan with respect to fractional shares, and any fractional shares resulting from such adjustments shall be eliminated from any outstanding option. 
  
 6. Participants: Subject to Paragraph 11, the Committee shall determine and
designate from time to time, in its Discretion, those key employees (including officers), directors, and SRC members of the Company or any Subsidiary to whom options are to be granted and who thereby become Participants under the Plan; provided,
however, that (a) Incentive Options shall be granted only to employees (as defined in the Code) of the Company or a corporate Subsidiary, to the extent required by Section 422 of the Code, or any successor provision, and (b) no Participant may be
granted stock options to purchase more than 100,000 Common Shares in the aggregate in any fiscal year of the Company, subject to any adjustments provided in the final paragraph of Paragraph 5 and in Paragraph 17. 
  
 7. Allotment of Shares: Subject to Paragraph 11, the Committee shall
determine and fix the number of Common Shares to be offered to each Participant; provided that no Incentive Option may be granted under the Plan to any one Participant which would result in the aggregate fair market value, determined as of the date
the option is granted, of the underlying stock with respect to which Incentive Options are exercisable for the first time by such individual during any calendar year (under all of such plans of the Company and its parent and Subsidiary corporations)
exceeding $100,000. 
  
 8. Option Price: Subject to the rules set
forth in this Paragraph 8, the Committee, in its Discretion, shall establish the option price at the time any option is granted. Such option price shall not be less than 100% of the fair market value of the stock on the date on which such option is
granted; provided that with respect to an Incentive Option granted to an employee who at the time of the grant owns (after applying the attribution rules of Section 424(d) of the Code) more than 10% of the total combined voting stock of the Company
or of any parent or Subsidiary, the option price shall not be less than 110% of the fair market value of the stock subject to the Incentive Option on the date such option is granted. Fair market value of a share shall be determined by the Committee
and may be determined by using the closing sale price of the Company’s stock on any exchange or other market on which the Common Shares shall be traded on such date, or if there is no sale on such date, on the next following date on which there
is a sale, or the average of the closing bid and asked prices in any market or quotation system in which the Common Shares shall be listed or traded on such date. The option price will be subject to adjustment in accordance with the provisions of
Paragraphs 5 and 17 of the Plan. 
  
 9. Granting and Exercise of
Options: The granting of options under the Plan shall be effected in accordance with determinations made by the Committee pursuant to the provisions of the Plan, by execution of instruments in writing in form approved by the Committee. Such
instruments shall constitute binding contracts between the Company and the Participant. 
  
 Subject to the terms of the Plan, the Committee, in its Discretion, may grant to Participants Incentive Options, Nonqualified Options or any combination thereof. Each option granted under the Plan shall designate the
number of shares covered thereby, if any, with respect to which the option is an Incentive Option and the number of shares covered thereby, if any, with respect to which the option is a Nonqualified Option. 
  
 Subject to the terms of the Plan, each option granted under the Plan shall be
exercisable at any such time or times or in any such installments as may be determined by the Committee in its Discretion; provided that the aggregate fair market value (determined as of the date the option is granted) of the underlying stock with
respect to which Incentive Options are exercisable for the first time by such individual during any calendar year (under all of such plans of the Company and its parent and Subsidiary corporations) shall not exceed $100,000. Except as provided in
Paragraph 14, options may be exercised only while the Participant is an employee, director, or SRC member of the Company or a Subsidiary. 
  

 Page 10 of 18 Pages 

 Notwithstanding any other term or provision of this Plan, but subject to the requirements of the Code
with respect to Incentive Options that are intended to remain Incentive Options, in connection with a Participant ceasing to be an employee of the Company or a Subsidiary for any reason, the stock option agreement may provide for the acceleration
of, or the Committee may accelerate, in its Discretion (exercised at the date of the grant of the stock option or after the date of grant), in whole or in part, the time or times or installments with respect to which any option granted under this
Plan shall be exercisable in connection with termination of a Participant’s employment with the Company or a Subsidiary, subject to any restrictions, terms and conditions fixed by the Committee either at the date of the award or at the date it
exercises such Discretion. 
  
 Successive stock options may be
granted to the same Participant, whether or not the option or options previously granted to such Participant remain unexercised. A Participant may exercise any option granted under the Plan, if then exercisable, notwithstanding that options granted
to such Participant prior to the option then being exercised remain unexercised. 
  
 10. Payment of Option Price: At the time of the exercise in whole or in part of any option granted under this Plan, payment in full in cash, or with the consent of the Committee, in its Discretion, in Common Shares or
by a promissory note payable to the order of the Company which is acceptable to the Committee, shall be made by the Participant for all shares so purchased. Such payment may, with the consent of the Committee, in its Discretion, also consist of a
cash down payment and delivery of such a promissory note in the amount of the unpaid exercise price. In the Discretion of, and subject to such conditions as may be established by, the Committee, payment of the option price may also be made by the
Company retaining from the shares to be delivered upon exercise of the stock option that number of shares having a fair market value on the date of exercise equal to the option price of the number of shares with respect to which the Participant
exercises the option. In the Discretion of the Committee, a Participant may exercise an option, if then exercisable, in whole or in part, by delivery to the Company of written notice of the exercise in such form as the Committee may prescribe,
accompanied by irrevocable instructions to a stock broker to promptly deliver to the Company full payment for the shares with respect to which the option is exercised from the proceeds of the stock broker’s sale of or loan against some or all
of the shares. Such payment may also be made in such other manner as the Committee determines is appropriate, in its Discretion. No Participant shall have any of the rights of a shareholder of the Company under any option until the actual issuance
of shares to such Participant, and prior to such issuance no adjustment shall be made for dividends, distributions or other rights in respect of such shares, except as provided in Paragraphs 5 and 17. 
  
 11. Automatic Stock Options: Notwithstanding other provisions of this Plan
and to the extent shares are available for grant under the Plan, Outside Directors and SRC members shall automatically be granted Non-qualified Stock Options on the terms described in this Paragraph 11. 
  
 Each Outside Director of the Corporation shall automatically be granted a
Nonqualified Stock Option to purchase 5,000 shares of Common Stock as of the date he or she is first elected or appointed to the Board of Directors. Each Outside Director of the Corporation who is re-elected to the Board of Directors shall
automatically be granted a Nonqualified Stock Option to purchase 2,000 shares of Common Stock as of the date of each re-election. 
  
 Each person who is elected or appointed to serve as an SRC member shall automatically be granted a Nonqualified Stock Option to purchase 2,500 shares of
Common Stock as of the date of his or her election or appointment. Each SRC member who is re-elected to the Scientific Review Council shall automatically be granted a Nonqualified Stock Option to purchase 1,000 shares of Common Stock as of the date
of each re-election. 
  

 Page 11 of 18 Pages 

 All options granted under this Paragraph 11 shall be exercisable in one-third cumulative annual
installments beginning one year after the date of grant, shall expire ten years after the date of grant and shall have an option price equal to 100% of the fair market value of the Company’s Common Stock on the date of grant. 
  
 12. Non-transferability of Options: No option granted under the Plan to a
Participant shall be transferable by such Participant otherwise than by will or by the laws of descent and distribution, and each such option shall be exercisable, during the lifetime of the Participant, only by the Participant. 
  
 13. Continuance of Employment; No Right to Continued Employment: The
Committee may require, in its Discretion, that any Participant under the Plan to whom an option shall be granted shall agree in writing as a condition of the granting of such option to remain in his or her position as an employee, director, or SRC
member of the Company or a Subsidiary for a designated minimum period from the date of the granting of such option as shall be fixed by the Committee. 
  
 Nothing contained in the Plan or in any option granted pursuant to the Plan, nor any action taken by the Committee hereunder, shall confer upon any
Participant any right with respect to continuation of employment, or other service by or to the Company or a Subsidiary nor interfere in any way with the right of the Company or a Subsidiary to terminate such person’s employment, or other
service at any time. 
  
 14. Termination of Employment; Expiration
of Options: Subject to the other provisions of the Plan, including, without limitation, Paragraphs 9, and 17 and this Paragraph 14, all rights to exercise options shall terminate when a Participant ceases to be an employee, director, or SRC member
of the Company or a Subsidiary for any cause, except that the Committee may, in its Discretion, permit the exercise of all or any portion of the options granted to such Participant 
  
 (i) for a period not to exceed three months following such termination with respect to Incentive Options that are intended to remain
Incentive Options if such termination is not due to death or permanent disability of the Participant, 
  
 (ii) for a period not to exceed one year following termination of employment with respect to Incentive Options that are Intended to remain Incentive Options if termination of employment is due to the death or
permanent disability of the Participant, and 
  
 (iii) for a period not to extend
beyond the expiration date with respect to Nonqualified Options or Incentive Options that are not intended to remain Incentive Options, 
  
 all subject to any restrictions, terms and conditions fixed by the Committee either at the date of the award or at the date it exercises such Discretion. In no event,
however, shall an option be exercisable after its expiration date, and, unless the Committee in its Discretion determines otherwise (pursuant to Paragraphs 9 or 17), an option may only be exercised after termination of a Participant’s
employment or other service by or to the Company to the extent exercisable on the date of such termination or to the extent exercisable as a result of the reason for such termination. The Committee may evidence the exercise of its Discretion under
this Paragraph 14 in any manner it deems appropriate, including by resolution or by a provision in, or amendment to, the option. 
  
 If not sooner terminated, each stock option granted under the Plan shall expire not more than 10 years from the date of the granting thereof; provided
that with respect to an Incentive Option, such option shall expire not more than 5 years after the date of granting thereof. 
  
 15. Investment Purpose: If the Committee in its Discretion determines that as a matter of law such procedure is or may be desirable, it may require a
Participant, upon any exercise of any option granted under the Plan or any portion thereof and as a condition to the Company’s obligation to deliver certificates representing the shares subject to exercise, to execute and deliver to the Company
a written 

  

 Page 12 of 18 Pages 

 
statement, in form satisfactory to the Committee, representing and warranting that the Participant’s purchase of Common Shares upon exercise thereof
shall be for such person’s own account, for investment and not with a view to the resale or distribution thereof and that any subsequent sale or offer for sale of any such shares shall be made either pursuant to (a) a Registration Statement on
an appropriate form under the Securities Act, which Registration Statement has become effective and is current with respect to the shares being offered and sold, or (b) a specific exemption from the registration requirements of the Securities Act,
but in claiming such exemption the Participant shall, prior to any offer for sale or sale of such shares, obtain a favorable written opinion from counsel for or approved by the Company as to the availability of such exemption. The Company may
endorse an appropriate legend referring to the foregoing restriction upon the certificate or certificates representing any shares issued or transferred to the Participant upon exercise of any option granted under the Plan. 
  
 16. Withholding Payments: If upon the exercise of any Nonqualified Option or
a disqualifying disposition (within the meaning of Section 422 of the Code) of shares acquired upon exercise of an Incentive Option, there shall be payable by the Company or a Subsidiary any amount for income tax withholding, in the Committee’s
Discretion, either the Participant shall pay such amount to the Company, or the amount of Common Shares delivered by the Company to the Participant shall be appropriately reduced, to reimburse the Company or such Subsidiary for such payment. The
Company or any of its Subsidiaries shall have the right to withhold the amount of such taxes from any other sums or property due or to become due from the Company or any of its Subsidiaries to the Participant upon such terms and conditions as the
Committee shall prescribe. The Company may also defer issuance of the stock upon exercise of such option until payment by the Participant to the Company of the amount of any such tax. The Committee may, in its Discretion, permit Participants to
satisfy such withholding obligations, in whole or in part, by electing to have the amount of Common Shares delivered or deliverable by the Company upon exercise of a stock option appropriately reduced, or by electing to tender Common Shares back to
the Company subsequent to exercise of a stock option to reimburse the Company or such Subsidiary for such income tax withholding, subject to such rules and regulations, if any, as the Committee may adopt. The Committee may make such other
arrangements with respect to income tax withholding as it shall determine. 
  
 17. Extraordinary Transactions: In case the Company (i) consolidates with or merges into any other corporation or other entity and is not the continuing or surviving entity of such consolidation or merger, or (ii)
permits any other corporation or other entity to consolidate with or merge into the Company and the Company is the continuing or surviving entity but, in connection with such consolidation or merger, the Common Shares are changed into or exchanged
for stock or other securities of any other corporation or other entity or cash or any other assets, or (iii) transfers all or substantially all of its properties and assets to any other corporation or other person or entity, or (iv) dissolves or
liquidates, or (v) effects a capital reorganization or reclassification in such a way that holders of Common Shares shall be entitled to receive stock, securities, cash or other assets with respect to or in exchange for the Common Shares, then, and
in each such case, proper provision shall be made so that, each Participant holding a stock option upon the exercise of such option at any time after the consummation of such consolidation, merger, transfer, dissolution, liquidation, reorganization
or reclassification (each transaction, for purposes of this Paragraph 17, being herein called a “Transaction”), shall be entitled to receive (at the aggregate option price in effect for all Common Shares issuable upon such exercise
immediately prior to such consummation and as adjusted to the time of such Transaction), in lieu of Common Shares issuable upon such exercise prior to such consummation, the stock and other securities, cash and assets to which such Participant would
have been entitled upon such consummation if such Participant had so exercised such stock option in full immediately prior thereto (subject to adjustments subsequent to such Transaction provided for in Paragraph 5). 
  
 Notwithstanding anything in the Plan to the contrary, in connection with any
Transaction and effective as of a date selected by the Committee, which date shall, in the Committee’s judgment, be far enough in advance of the Transaction to permit Participants holding stock options to exercise their 

  

 Page 13 of 18 Pages 

 
options and participate in the Transaction as a holder of Common Shares, the Committee, acting in its Discretion without the consent of any Participant, may
effect one or more of the following alternatives with respect to all of the outstanding stock options (which alternatives may be made conditional on the occurrence of the applicable Transaction and which may, if permitted by law, vary among
individual Participants): (a) accelerate the time at which stock options then outstanding may be exercised so that such stock options may be exercised in full for a limited period of time on or before a specified date fixed by the Committee after
which specified date all unexercised stock options and all rights of Participants thereunder shall terminate; (b) accelerate the time at which stock options then outstanding may be exercised so that such stock options may be exercised in full for
their then remaining term; or (c) require the mandatory surrender to the Company of outstanding stock options held by such Participants (irrespective of whether such stock options are then exercisable) as of a date, before or not later than sixty
days after such Transaction, specified by the Committee, and in such event the Company shall thereupon cancel such stock options and shall pay to each Participant an amount of cash equal to the excess of the fair market value of the aggregate Common
Shares subject to such stock option, determined as of the date such Transaction is effective, over the aggregate option price of such shares, less any applicable withholding taxes; provided, however, the Committee shall not select an alternative
(unless consented to by the Participant) such that, if a Participant exercised his or her accelerated stock option pursuant to alternative (a) or (b) and participated in the Transaction or received cash pursuant to alternative (c), the alternative
would result in the Participant’s owing any money by virtue of the operation of Section 16(b) of the Exchange Act. If all such alternatives have such a result, the Committee shall, in its Discretion, take such action to put such Participant in
as close to the same position as such Participant would have been in had alternative (a), (b) or (c) been selected but without resulting in any payment by such Participant pursuant to Section 16(b) of the Exchange Act. Notwithstanding the foregoing,
with the consent of affected Participants, each with respect to such Participant’s option only, the Committee may in lieu of the foregoing make such provision with respect to any Transaction as it deems appropriate. 
  
 18. Effectiveness of Plan: This Plan shall be effective on the date the Board
of Directors of the Company adopts this Plan, provided that the shareholders of the Company approve the Plan within 12 months after its adoption by the Board of Directors. Options may be granted before shareholder approval of this Plan, but each
such option shall be subject to shareholder approval of this Plan. No option granted under this Plan shall be exercisable unless and until this Plan shall have been approved by the Company’s shareholders. 
  
 19. Termination, Duration and Amendments to the Plan: The Plan may be
abandoned or terminated at any time by the Board of Directors of the Company. Unless sooner terminated, the Plan shall terminate on the date ten years after the earlier of its adoption by the Board of Directors or its approval by the shareholders of
the Company, and no stock options may be granted under the Plan thereafter. The termination of the Plan shall not affect the validity of any option which is outstanding on the date of termination. 
  
 For the purpose of conforming to any changes in applicable law or
governmental regulations, or for any other lawful purpose, the Board of Directors shall have the right, with or without approval of the shareholders of the Company, to amend or revise the terms of this Plan or any option agreement under this Plan at
any time; provided, however, that (i) to the extent required by Section 162(m) of the Code and related regulations, or any successor rule, but only with respect to amendments or revisions affecting Participants whose compensation is subject to
Section 162(m) of the Code, and to the extent required by Section 422 of the Code, or any successor section, but only with respect to Incentive Options, no such amendment or revision shall increase the maximum number of shares in the aggregate which
are subject to this Plan (subject, however, to the provisions of Paragraphs 5 and 17) without the approval or ratification of the shareholders of the Company, and (ii) no such amendment or revision shall change the option price (except as
contemplated by Paragraphs 5 and 17) or alter or impair any option which shall have been previously granted under this Plan, in a manner adverse to a Participant, without the consent of such Participant. 
  
 As adopted by the Board of Directors on August 14, 1997, and amended on July
20, 2000 and on July 22, 2004. 
  

 Page 14 of 18 Pages

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