Document:

Unassociated Document

    
      
        	 	Exhibit
                4.1

      

    

     

    2008
      AMENDMENT AND RESTATEMENT OF THE

     

    JACKSONVILLE
      BANCORP, INC.

     

    2006
      STOCK INCENTIVE PLAN

     

    1.  Purpose.
      The
      purposes of this 2008 Amendment and Restatement of the Jacksonville Bancorp,
      Inc. 2006 Stock Incentive Plan (the “Plan”) are (i) to encourage outstanding
      individuals to accept or continue employment with Jacksonville Bancorp, Inc.
      (the “Company”) and its subsidiaries, and (ii) to furnish maximum incentive to
      those persons to improve operations and increase profits and to strengthen
      the
      mutuality of interest between those persons and the Company’s shareholders by
      providing them with stock options and other stock and cash incentives. The
      Plan
      is intended to operate in compliance with the provisions of Securities and
      Exchange Commission Rule 16b-3.

     

    2.  Definitions.
      As used
      in the Plan, the following terms have the meanings indicated:

     

    (a)  “Act”
means
      the Securities Exchange Act of 1934, as amended.

     

    (b)  “Applicable
      Withholding Taxes”
means
      the aggregate amount of federal, state and local income and payroll taxes that
      the Company is required to withhold in connection with any Performance Grant
      any
      lapse of restrictions on or payment with respect to Restricted Stock or
      Restricted Stock Units, or any exercise of a Nonstatutory Stock Option or Stock
      Appreciation Right.

     

    (c)  “Board”
means
      the board of directors of the Company.

     

    (d)  “Change
      in Control”
means
      unless otherwise provided in the Grant Agreement with respect to a particular
      Incentive Award, the date on which either (A) the Service Recipient at the
      time
      of the event or (B) any corporation in a chain of corporations in which each
      corporation owns more than 50 percent of the total fair market value and total
      voting power of another corporation in the chain ending with the Service
      Recipient at the time of the event (in either case, the “Affected Corporation”)
      experiences a change in ownership (as described in subsection (i)), a change
      in
      effective control (as described in subsection (ii)), or a change in the
      ownership of a substantial portion of its assets (as described in subsection
      (iii)):

     

    (i)  any
      person or more than one person acting as a group acquires beneficial ownership
      of Affected Corporation stock that, together with the Affected Corporation
      stock
      already held by such person or group, represents more than 50 percent of the
      total fair market value or total voting power of the Affected Corporation stock;
      provided, however, that if any one person or more than one person acting as
      a
      group is considered to own more than 50 percent of the total fair market value
      or total voting power of the Affected Corporation stock, the acquisition of
      additional stock by the same person or persons is not considered to cause a
      change in the ownership of the Affected Corporation for purposes of this
      subsection (i) or to cause a change in effective control of the Affected
      Corporation for purposes of subsection (ii);

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    (ii)  (1)
      any
      person or more than one person acting as a group acquires (or has acquired
      during the twelve-consecutive-month period ending on the date of the most recent
      acquisition by such person or persons) beneficial ownership of Affected
      Corporation stock possessing 30 percent or more of the total voting power of
      the
      Affected Corporation stock; or (2) a majority of members of the Board is
      replaced during a twelve-consecutive-month period by directors whose appointment
      or election is not endorsed by a majority of the members of the Board before
      the
      date of the appointment or election; provided, however, that if any one person
      or more than one person acting as a group is considered to effectively control
      the Affected Corporation for purposes of this subsection (ii), the acquisition
      of additional control of the corporation by the same person or persons is not
      considered to cause a change in the effective control for purposes of this
      subsection (ii) or to cause a change in ownership of the Affected Corporation
      for purposes of subsection (i); or

     

    (iii)  any
      person or more than one person acting as a group acquires (or has acquired
      during the twelve-consecutive-month period ending on the date of the most recent
      acquisition by such person or group) assets from the Affected Corporation having
      a total gross fair market value equal to 40 percent or more of the total gross
      fair market value of all of the assets of the Affected Corporation immediately
      prior to such acquisition or acquisitions; provided that a transfer of assets
      by
      an Affected Corporation is not treated as a change in the ownership of such
      assets if the assets are transferred to (I) a shareholder of the Affected
      Corporation immediately before the asset transfer in exchange for or with
      respect to Affected Corporation stock; (II) an entity, 50 percent or more of
      the
      total fair market value or total voting power of which is owned, directly or
      indirectly, by the Affected Corporation; (III) a person or more than one person
      acting as a group that owns, directly or indirectly, 50 percent or more of
      the
      total fair market value or total voting power of all outstanding Affected
      Corporation stock; or (IV) an entity, at least 50 percent of the total fair
      market value or total voting power of which is owned, directly or indirectly,
      by
      a person described in (III) above. Except as otherwise provided in this
      subsection (iii), a person’s status is determined immediately after the transfer
      of the assets. For purposes of this subsection (iii), “gross fair market value”
means the value of the assets of the Affected Corporation, or the value of
      the
      assets being disposed of, determined without regard to any liabilities
      associated with such assets.

     

    For
      purposes of this Section 2(e), the term “group” shall have the same meaning as
      in Section 13(d)(3) of the Act, modified to the extent necessary to comply
      with
      Sections 1.409A-3(i)(5)(v)(B), (vi)(D) or (vii)(C) of the Treasury Regulations
      (or any successor provisions). The term “beneficial ownership” shall have the
      same meaning as in Rule 13d-3 promulgated under the Act, modified to the extent
      necessary to comply with Section 1.409A-3(i)(5)(v)(iii) of the Treasury
      Regulations (or any successor provision). Notwithstanding anything in this
      Section 2(e) to the contrary, unless otherwise provided in the Grant Agreement
      with respect to a particular Incentive Award, an event which does not constitute
      a change in the ownership, a change in the effective control, or a change in
      the
      ownership of a substantial portion of the assets of the Affected Corporation,
      each as defined in Section 1.409A-3(i)(5) of the Treasury Regulations (or any
      successor provision), shall not constitute a Change of Control for purposes
      of
      this Plan.

     

    
      
         

      

      
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    (e)  “Code”
means
      the Internal Revenue Code of 1986, as amended, and as may be amended from time
      to time. Any reference in the Plan to a specific Section of the Code shall
      include any successor provision of the Code.

     

    (f)  “Committee”
means,
      the Compensation Committee of the Board. Each member of the Committee shall
      satisfy such requirements as may be established by the NASDAQ Stock Market.
      In
      addition, if any member of the Committee does not qualify as an outside director
      for purposes of Code Section 162(m) or as a non-employee director for purposes
      of Rule 16b-3, the remaining members of the Committee (but not less than two
      members) shall be constituted as a subcommittee of the Compensation Committee
      to
      act as the Committee for purposes of the Plan.

     

    (g)  “Company
      Stock”
means
      common stock of the Company. In the event of a change in the capital structure
      of the Company (as provided in Section 15), the shares resulting from such
      a
      change shall be deemed to be Company Stock within the meaning of the
      Plan.

     

    (h)  “Date
      of Grant”
means
      (i) with respect to a Non-Option Award, the date on which the Committee grants
      the award; (ii) with respect to a Nonstatutory Option or Stock Appreciation
      Right, the date on which the Committee completes the corporate action necessary
      to create a legally binding right constituting the Nonstatutory Stock Option
      or
      Stock Appreciation Right; (iii) with respect to an Incentive Stock Option,
      the
      date on which the Committee completes the corporate action constituting an
      offer
      of stock for sale to a Participant under the terms and conditions of the
      Incentive Stock Option; or (iv) with respect to any Incentive Award, such future
      date on which the grant is to be effective as specified by the
      Committee.

     

    (i)  “Disability”
or
      “Disabled”
means,
      as to an Incentive Stock Option, a Disability within the meaning of Code Section
      22(e)(3). As to all other Incentive Awards, Disability (or variations thereof)
      means, unless otherwise provided in the Grant Agreement with respect to the
      award, a Disability within the meaning of Code Section 409A(a)(2)(C) and
      Treasury Regulations Section 1.409A-3(i)(4) (or any successor provision). The
      Committee shall determine whether a Disability exists and the determination
      shall be conclusive.

     

    (j)  “Fair
      Market Value”
means
      the closing price per share of Company Stock on the exchange on which the
      Company Stock is traded on the Date of Grant or any other date for which the
      value of Company Stock must be determined under the Plan, or, if the
      determination date is not a trading day, on the most recent trading day
      immediately preceding the determination date.

     

    (k)  “Grant
      Agreement”
means
      the written agreement between the Company and a Participant containing the
      terms
      and conditions with respect to an Incentive Award.

     

    (l)  “Incentive
      Award”
means,
      collectively, an award of an Option, Restricted Stock, a Restricted Stock Unit,
      a Stock Appreciation Right or a Performance Grant under the Plan.

     

    (m)  “Incentive
      Stock Option”
means
      an Option intended to meet the requirements of, and qualify for favorable
      federal income tax treatment under, Code Section 422.

     

    
      
         

      

      
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    (n)  “Mature
      Shares”
means
      previously acquired shares of Company Stock for which the holder thereof has
      good title, free and clear of all liens and encumbrances, and which such holder
      has held for at least six months if the Company is accounting for Incentive
      Awards using APB Opinion 25, or has purchased on the open market.

     

    (o)  “Nonstatutory
      Stock Option”
means
      an Option that does not meet the requirements of Code Section 422, or, even
      if
      meeting the requirements of Code Section 422, is not intended to be an Incentive
      Stock Option and is so designated.

     

    (p)  “Option”
means
      a
      right to purchase Company Stock granted under the Plan, at a price determined
      in
      accordance with the Plan.

     

    (q)  “Outside
      Director”
means
      any member of the Board who is not otherwise an employee of the Company or
      any
      of its subsidiaries.

     

    (r)  “Participant”
means
      any employee of the Company or its Related Companies who receives an Incentive
      Award under the Plan.

     

    (s)  “Performance
      Criteria”
means
      any of the following areas of performance of the Company: total shareholder
      return, revenue, gross profit, pre-tax earnings, net operating profit after
      taxes, net income, earnings per share, gross margin, net interest margin,
      operating cash flow, free cash flow, return on assets, return on invested
      capital, and return on equity. Performance Criteria may be used to measure
      the
      performance of the Company as a whole or any business unit of the Company,
      and
      may be measured relative to a peer group or index.

     

    (t)  “Performance
      Goal”
means
      an objectively determinable performance goal established by the Committee with
      respect to a given Performance Grant or a grant of Restricted Stock or
      Restricted Stock Units that relates to one or more Performance
      Criteria.

     

    (u)  “Performance
      Grant”
means
      an Incentive Award made pursuant to Section 10.

     

    (v)  “Plan
      Year”
means
      January 1 to December 31.

     

    (w)  “Related
      Company”
means,
      (i) for purposes of determining eligibility to receive an Incentive Stock
      Option, any “parent corporation” with respect to the Company within the meaning
      of Code Section 424(e) or any “subsidiary corporation” with respect to the
      Company within the meaning of Code Section 424(f); (ii) for purposes of
      determining eligibility to receive a Nonstatutory Stock Option or Stock
      Appreciation Right, any corporation or other entity in a chain of corporations
      or other entities in which each corporation or other entity has a controlling
      interest (within the meaning of Treasury Regulations Section
      1.409A-1(b)(5)(E)(1) (or any successor provision)) in another corporation or
      other entity in the chain, beginning with a corporation or other entity in
      which
      the Company has a controlling interest; and (iii) for all other purposes under
      the Plan, any corporation, trade or business that would be required to be
      treated as a single employer with the Company under Code Sections 414(b) or
      (c),
      provided that, in applying Code Sections 1563(a)(1), (2) and (3) for purposes
      of
      determining a controlled group of corporations, or in applying Treasury
      Regulations Section 1A1 4(c)-2 for purposes of determining trades or businesses
      under common control, the phrase “at least 50%” shall replace the phrase “at
      least 80%” each time it appears in those sections.

     

    
      
         

      

      
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    (x)  “Repricing”
means,
      with respect to an Option or Stock Appreciation Right, any of the following:
      (i)
      the lowering of the exercise price after the Date of Grant; (ii) the taking
      of
      any other action that is treated as a repricing under generally accepted
      accounting principles; or (iii) the cancellation of the Option or Stock
      Appreciation Right at a time when its exercise price (or, with respect to the
      Stock Appreciation Right, the Fair Market Value of the Company Stock covered
      by
      the Stock Appreciation Right on the Date of Grant) exceeds the Fair Market
      Value
      of the underlying Company Stock in exchange for any other Incentive Award,
      unless the cancellation and exchange occurs in connection with a merger,
      acquisition, spin-off or other similar corporate transaction.

     

    (y)  “Restricted
      Stock”
means
      Company Stock awarded upon the terms and subject to the restrictions set forth
      in Section 7.

     

    (z)  “Restricted
      Stock Unit”
means
      a
      right to receive Company Stock, cash or a combination of Company Stock or cash
      upon the terms and subject to the conditions of Section 8.

     

    (aa)  “Rule
      16b-3”
means
      Rule 16b-3 of the Securities and Exchange Commission promulgated under the
      Act.
      A reference in the Plan to Rule 16b-3 shall include a reference to any
      corresponding rule (or number redesignation) of any amendments to Rule 16b-3
      enacted after the effective date of the Plan’s adoption.

     

    (bb)  “Service
      Recipient”
means,
      with respect to a Service Provider, the Company or the Related Company for
      which
      the employee performs services.

     

    (cc)  “Stock
      Appreciation Right”
means
      a
      right to receive Company Stock or cash from the Company granted under Section
      9.

     

    (dd)  “Taxable
      Year”
means
      the fiscal period used by the Company for reporting taxes on income under the
      Code.

     

    (ee)  “Treasury
      Regulations”
mean
      the final, temporary or proposed regulations issued by the Treasury Department
      and/or Internal Revenue Service as codified in Title 26 of the United States
      Code of Federal Regulations.

     

    3.  General.
      The
      following types of Incentive Awards may be granted under the Plan: Options,
      Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, and
      Performance Grants. Options granted under the Plan may be Incentive Stock
      Options or Nonstatutory Stock Options.

     

    4.  Stock.

     

    (a)  Subject
      to Section 15 of the Plan, there shall be reserved for issuance under the Plan
      an aggregate of 70,000 common shares of Company Stock, which shall be authorized
      but unissued shares. No more than 15,000 shares may be allocated to the
      Incentive Awards, including the maximum shares payable under a Performance
      Grant, that are granted during any single Taxable Year to any individual
      Participant who is an employee of the Company or any subsidiary of the Company.
      All of the shares available for issuance to Participants who are employees
      of
      the Company or its subsidiaries may, but need not, be issued pursuant to the
      exercise of Incentive Stock Options. Shares covered by an Incentive Award
      granted under the Plan shall not be counted as used unless and until they are
      actually issued and delivered to a Participant.

     

    
      
         

      

      
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    (b)  Shares
      allocable to Incentive Awards or portions thereof granted under the Plan that
      expire, are forfeited, lapse or otherwise terminate or are cancelled shall
      be
      added to the shares available for Incentive Awards under the Plan. Any shares
      covered by a Stock Appreciation Right shall be counted as used only to the
      extent shares are actually issued to the Participant when the Stock Appreciation
      Right is exercised. In addition, any shares of Company Stock exchanged by a
      Participant as full or partial payment to the Company of the exercise price
      under an Option, any shares retained by the Company in satisfaction of a
      Participant’s obligations to pay Applicable Withholding Taxes with respect to
      any Incentive Award and any shares of Company stock covered by an Incentive
      Award that is settled in cash shall be added to the shares available for
      Incentive Awards under the Plan.

     

    (c)  The
      Committee is expressly authorized to make an Incentive Award to a Participant
      conditioned upon the surrender for cancellation of an option granted under
      an
      existing Incentive Award. However, without prior shareholder approval, the
      Committee is expressly prohibited from making a new Incentive Award in the
      form
      of an Option if the exercise price of the new Option is less than the exercise
      price of the Option under the existing Incentive Award surrendered for
      cancellation. In addition, the Committee is expressly prohibited from making
      a
      new Incentive Award of Restricted Stock or Restricted Stock Units if the
      exercise price of the outstanding Option exceeds the Fair Market Value of the
      shares of Company Stock allocated to the Option on the date of the surrender
      or
      cancellation of the Option, unless otherwise approved by the Company’s
      shareholders.

     

    5.  Eligibility.

     

    (a)  All
      present and future employees of the Company or any Related Company (whether
      now
      existing or hereafter created or acquired) whom the Committee determines to
      have
      contributed or who can be expected to contribute significantly to the Company
      or
      any Related Company shall be eligible to receive Incentive Awards under the
      Plan. The Committee shall have the power and complete discretion, as provided
      in
      Section 16, to select eligible employees to receive Incentive Awards and to
      determine for each employee the nature of the award and the terms and conditions
      of each Incentive Award.

     

    (b)  The
      grant
      of an Incentive Award shall not obligate the Company or any subsidiary of the
      Company to pay an employee any particular amount of remuneration, to continue
      the employment of the employee after the grant or to make further grants to
      the
      employee at any time thereafter.

     

    6.  Stock
      Options.

     

    (a)  The
      Committee may make grants of Options to eligible employees. Whenever the
      Committee deems it appropriate to grant Options, notice shall be given to the
      employee stating the number of shares for which Options are granted, the Option
      price per share, whether the Options are Incentive Stock Options or Nonstatutory
      Stock Options, the extent to which Stock Appreciation Rights are granted (as
      provided in Section 9), and the conditions to which the grant and exercise
      of
      the Options are subject. This notice, when duly executed by the employee, shall
      become the Grant Agreement between the Company and employee and, at that time,
      the employee shall become a Participant. Only employees described in Section
      5(a) shall be eligible to receive awards of Incentive Stock
      Options.

     

    
      
         

      

      
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    (b)  The
      exercise price of shares of Company Stock covered by an Option shall be not
      less
      than 100% of the Fair Market Value of such shares on the Date of Grant. If
      the
      Participant is a Ten Percent Shareholder and the Option is intended to qualify
      as an Incentive Stock Option, the exercise price shall not be less than 110%
      of
      the Fair Market Value of such shares on the Date of Grant.

     

    (c)  Options
      may be exercised in whole or in part at such times as may be specified by the
      Committee in the Participant’s stock option agreement; provided that no Option
      may be exercised after the expiration of ten (10) years from the Date of Grant
      and further provided that the exercise provisions for Incentive Stock Options
      shall in all events not be more liberal than the following
      provisions:

     

    (i)  No
      Incentive Stock Option may be exercised after the first to occur of (x) ten
      years from the Date of Grant (five years if the Participant to whom the Option
      has been granted is a Ten Percent Shareholder), (y) three months following
      the
      date of the Participant’s retirement or termination of employment with the
      Company and all Related Companies for reasons other than Disability or death,
      or
      (z) one year following the date of the Participant’s termination of employment
      on account of Disability or death.

     

    (ii)  An
      Incentive Stock Option by its terms, shall be exercisable in any calendar year
      only to the extent that the aggregate Fair Market Value (determined at the
      Date
      of Grant) of the Company Stock with respect to which Incentive Stock Options
      are
      exercisable for the first time during the calendar year does not exceed $100,000
      (the “Limitation Amount”). Incentive Stock Options granted under the Plan and
      all other plans of any Company shall be aggregated for purposes of determining
      whether the Limitation Amount has been exceeded. The Committee granting the
      Option may impose such conditions as it deems appropriate on an Incentive Stock
      Option to ensure that the foregoing requirement is met. If Incentive Stock
      Options that first become exercisable in a calendar year exceed the Limitation
      Amount, the excess Options will be treated as Nonstatutory Stock Options to
      the
      extent permitted by law.

     

    (d)  Options
      shall not be transferable except to the extent specifically provided in the
      Grant Agreement. Incentive Stock Options, by their terms, shall not be
      transferable except by will or the laws of descent and distribution and shall
      be
      exercisable, during the Participant’s lifetime, only by the
      Participant.

     

    (e)  A
      Participant who purchases shares of Company Stock under an Option shall have
      no
      rights as a shareholder until the Company Stock is issued pursuant to the terms
      of the Grant Agreement and all requirements with respect to the issuance of
      such
      shares have been satisfied.

     

    
      
         

      

      
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    (f)  Options
      may be exercised by the Participant giving written notice of the exercise to
      the
      Company, stating the number of shares the Participant has elected to purchase
      under the Option. The notice shall be effective only if accompanied by the
      exercise price in full in cash; provided, however, that if the terms of an
      Option or the Committee in its discretion so permits, the Participant (i),
      unless prohibited by law, may deliver a properly executed exercise notice
      together with irrevocable instructions to a broker to deliver promptly to the
      Company, from the sale or loan proceeds with respect to the sale of Company
      Stock or a loan secured by Company Stock, the amount necessary to pay the
      exercise price and, if required by the terms of the Option or the Committee
      in
      its discretion, Applicable Withholding Taxes, (ii) may deliver shares of Company
      Stock for which the holder thereof has good title, free and clear of all liens
      and encumbrances (valued at their Fair Market Value on the date of exercise)
      in
      satisfaction of all or any part of the exercise price, or (iii) may cause to
      be
      withheld from the Option shares, shares of Company Stock (valued at their Fair
      Market Value on the date of exercise) in satisfaction of all or any part of
      the
      exercise price; or (iv) may use any other methods of payment as the Committee,
      at its discretion, deems appropriate. Until the Participant has paid the
      exercise price and any Applicable Withholding Taxes, no stock certificate shall
      be issued.

     

    (g)  The
      Company may suspend the right to exercise an Option at any time when the Company
      determines that allowing the exercise and issuance of Company Stock would
      violate any federal or state securities or other laws. The Committee may provide
      that any time periods to exercise the Option are extended during a period of
      suspension.

     

    (h)  Each
      Participant shall agree as a condition of the exercise of an Option to pay
      to
      the Company, or make arrangements satisfactory to the Company regarding the
      payment to the Company of, Applicable Withholding Taxes. Until the amount has
      been paid or arrangements satisfactory to the Company have been made, no stock
      certificate shall be issued upon the exercise of an Option. Payment to the
      Company in satisfaction of Applicable Withholding Taxes may be in cash or in
      shares of Company Stock (valued at their Fair Market Value as of the date of
      payment) to which the Participant has good title, free and clear of all liens
      and encumbrances. As an alternative to making a separate payment to the Company
      to satisfy Applicable Withholding Taxes, if the Committee allows or the Grant
      Agreement so provides, the Participant may elect to have the Company retain
      that
      number of shares of Company Stock (valued at their Fair Market Value as of
      the
      date of such retention) that would satisfy all or a specified portion of the
      Applicable Withholding Taxes. The shares of Company Stock retained may not
      exceed the amount of the Applicable Withholding Taxes.

     

    (i)  Unless
      specifically provided in the discretion of the Committee in a writing that
      references and supersedes this Section 6(i), (i) no Modification shall be made
      in respect to any Option if such Modification would result in the Option
      constituting a deferral of compensation, and (ii) no Extension shall be made
      in
      respect to any Option if such Extension would result in the Option having an
      additional deferral feature from the Date of Grant, in each case within the
      meaning of applicable Treasury Regulations under Code Section 409A. Subject
      to
      the remaining part of this subsection, (x) a “Modification” means any change in
      the terms of the Option (or change in the terms of the Plan or applicable Grant
      Agreement) that may provide the holder of the Option with a direct or indirect
      reduction in the exercise price of the Option, regardless of whether the holder
      in fact benefits from the change in terms; and (y) an “Extension” means either
      (A) the provision to the holder of an additional period of time within which
      to
      exercise the Option beyond the time originally prescribed, (B) the conversion
      or
      exchange of the Option for a legally binding right to compensation in a future
      taxable year, (C) the addition of any feature for the deferral of compensation
      to the terms of the Option, or (D) any renewal of the Option that has the effect
      of (A) through (C) above. Notwithstanding the preceding sentence, it shall
      not
      be a Modification or an Extension, respectively, to change the terms of an
      Option in accordance with Section 15 of the Plan, or in any of the other ways
      or
      for any of the other purposes provided in applicable Treasury Regulations or
      other generally applicable guidance under Code Section 409A as not resulting
      in
      a Modification or Extension for purposes of that section. In particular, it
      shall not be an Extension to extend the exercise period of an Option to a date
      no later than the earlier of (i) the latest date upon which the Option could
      have expired by its original terms under any circumstances or (ii) the tenth
      anniversary of the original Date of Grant.

     

    
      
         

      

      
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    7.  Restricted
      Stock Awards.

     

    (a)  The
      Committee may make grants of Restricted Stock to employees. Whenever the
      Committee deems it appropriate to grant Restricted Stock, notice shall be given
      to the employee stating the number of shares of Restricted Stock granted and
      the
      terms and conditions to which the Restricted Stock is subject. This notice,
      when
      duly executed by the employee, shall become the Grant Agreement between the
      Company and the employee and, at that time, the employee shall become a
      Participant. Restricted Stock may be awarded by the Committee in its discretion
      without cash consideration.

     

    (b)  No
      shares
      of Restricted Stock may be sold, assigned, transferred, pledged, hypothecated,
      or otherwise encumbered or disposed of until the restrictions on such shares
      as
      set forth in the Participant’s Grant Agreement have expired or been removed
      pursuant to paragraph (d) or (e) below.

     

    (c)  Upon
      the
      acceptance by a Participant of an award of Restricted Stock, such Participant
      shall, subject to the restrictions set forth in paragraph (b) above, have all
      the rights of a shareholder with respect to such shares of Restricted Stock,
      including, but not limited to, the right to vote such shares of Restricted
      Stock
      and the right to receive all dividends and other distributions paid thereon.
      Unless otherwise provided in the Grant Agreement, (i) dividends or other
      distributions paid in shares of Company Stock shall be subject to the same
      restrictions set forth in Section 7(b) as the shares of the Restricted Stock
      with respect to which the dividends or other distributions are paid and (ii)
      dividends or other distributions paid in cash shall be paid at the same time
      and
      under the same conditions as such dividends or other distributions are paid
      to
      shareholders of record of Company Stock. Certificates representing Restricted
      Stock shall be held by the Company until the restrictions expire and the
      Participant shall provide the Company with appropriate stock powers endorsed
      in
      blank.

     

    (d)  The
      Committee shall establish as to each award of Restricted Stock the terms and
      conditions upon which the restrictions set forth in paragraph (b) above shall
      expire. The terms and conditions may include the achievement of a Performance
      Goal. Restrictions conditioned on the passage of time shall not expire less
      than
      three years from the Date of Grant of the Restricted Stock, and restrictions
      conditioned on the achievement of Performance Goals shall not expire less than
      one year from the Date of Grant. Notwithstanding the foregoing, the Committee
      may in its discretion, and without limitation, provide that restrictions will
      expire as a result of the Disability, death or retirement of the Participant
      or
      the occurrence of a Change in Control. The terms and conditions of a Restricted
      Stock award shall be governed by the provisions of Section 10 to the extent
      that
      the award is intended to comply with the requirements of Code Section
      162(m).

     

    
      
         

      

      
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    (e)  Notwithstanding
      the provisions of Section 7(b) above, the Committee may at any time, in its
      sole
      discretion, modify the terms and conditions of a Restricted Stock award
      (including any or all of the restrictions applicable thereto), subject to the
      restrictions of Section 10 as to any Performance Goal if the award is intended
      to comply with the requirements of Code Section 162(m).

     

    (f)  Each
      Participant shall agree at the time his or her Restricted Stock is granted,
      and
      as a condition thereof, to pay to the Company, or make arrangements satisfactory
      to the Company regarding the payment to the Company of Applicable Withholding
      Taxes. Until such amount has been paid or arrangements satisfactory to the
      Company have been made, no stock certificate free of a legend reflecting the
      restrictions set forth in paragraph (b) above shall be issued to such
      Participant. As an alternative to making a cash payment to the Company to
      satisfy Applicable Withholding Taxes, if the terms of the grant so permit,
      the
      Participant may elect to (i) to deliver Mature Shares (valued at their Fair
      Market Value) or (ii) to have the Company retain that number of shares of
      Company Stock (valued at their Fair Market Value) that would satisfy all or
      a
      specified portion of the Applicable Withholding Taxes. The shares of Company
      Stock retained my not exceed the amount of Applicable Withholding
      Taxes.

     

    8.  Restricted
      Stock Unit Awards.

     

    (a)  The
      Committee may make grants of Restricted Stock Units to employees. Whenever
      the
      Committee deems it appropriate to grant Restricted Stock Units, notice shall
      be
      given to the employee stating the number of Restricted Stock Units granted
      and
      the terms and conditions to which the Restricted Stock Units are subject. This
      notice, when duly executed by the employee shall become the Grant Agreement
      between the Company and the employee and, at that time, the employee shall
      become a Participant. Restricted Stock Units may be awarded by the Committee
      in
      its discretion without cash consideration.

     

    (b)  Restricted
      Stock Units shall be subject to such restrictions as the Committee determines,
      including, without limitation, any of the following:

     

    (i)  a
      prohibition against sale, assignment, transfer, pledge, hypothecation or other
      encumbrance for a specified period; or

     

    (ii)  a
      requirement that the holder forfeit such units in the event of termination
      of
      employment during the period of restriction.

     

    All
      restrictions shall expire at such times as the Committee shall specify.
      Restrictions conditioned on the passage of time shall not expire less than
      three
      years from the Date of Grant of the Restricted Stock Units, and restrictions
      conditioned on the achievement of performance goals shall not expire less than
      one year from the Date of Grant. Notwithstanding the foregoing, the Committee
      may in its discretion, and without limitation, provide that restrictions will
      expire as a result of the Disability, death or retirement of the Participant
      or
      the occurrence of a Change in Control. In addition, the Committee may at any
      time, in its sole discretion, modify the terms and conditions of a Restricted
      Stock Unit Award (including any or all of the restrictions applicable thereto),
      subject to the restrictions of Section 10 as to any Performance Goal if the
      award is intended to comply with the requirements of Code Section
      162(m).

     

    
      
         

      

      
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    (c)  The
      Committee may also establish such other terms and conditions as it deems
      appropriate for an award of Restricted Stock Units. The terms and conditions
      may
      include the achievement of a Performance Goal. The terms and conditions of
      a
      Restricted Stock Unit award shall be governed by the provisions of Section
      10 to
      the extent that the award is intended to comply with the requirements of Code
      Section 162(m).

     

    (d)  Each
      Participant shall agree at the time his or her Restricted Stock Units are
      granted, and as a condition thereof, to pay to the Company or make arrangements
      satisfactory to the Company regarding the payment to the Company of, Applicable
      Withholding Taxes. Until such amount has been paid or arrangements satisfactory
      to the Company have been made, no stock certificates shall be issued to such
      Participant. As an alternative to making a cash payment to the Company to
      satisfy Applicable Withholding Taxes, if the terms of the grant so permit,
      the
      Participant may elect to (i) deliver Mature Shares or (ii) have the Company
      retain the number of shares of Company Stock (valued at their Fair Market Value)
      that would satisfy all or a specified portion of the Applicable Withholding
      Taxes.

     

    (e)  Except
      to
      the extent this Plan or the Committee specifies otherwise, Restricted Stock
      Units represent an unfunded and unsecured obligation of the Company and do
      not
      confer any of the rights of a shareholder until shares of Company Stock are
      issued thereunder. Settlement of Restricted Stock Units upon expiration of
      the
      vesting period or any later period of deferral shall be made in shares of
      Company Stock or otherwise as determined by the Committee. The number of shares,
      or other settlement medium, to be so distributed may be increased by an interest
      factor or by dividend equivalents. Until a Restricted Stock Unit is so settled,
      the number of shares represented by a Restricted Stock Unit shall be subject
      to
      adjustment pursuant to Section 15. Any Restricted Stock Units that are settled
      after the Participant’s death shall be distributed to the Participant’s
      designated beneficiary(ies) or, if none was designated, the Participant’s
      estate.

     

    9.  Stock
      Appreciation Rights.

     

    (a)  The
      Committee may grant Stock Appreciation Rights to eligible employees. Whenever
      the Committee grants Stock Appreciation Rights, notice shall be given to the
      employee stating the number of shares with respect to which Stock Appreciation
      Rights are granted, the extent, if any, to which the Stock Appreciation Rights
      are granted in connection with all or any part of a Nonstatutory Stock Option
      (“Tandem Rights”), and the conditions to which the grant and exercise of the
      Stock Appreciation Rights are subject. This notice, when duly executed by the
      employee, shall become the Grant Agreement between the Company and the Service
      Provider and, at that time, the employee shall become a
      Participant.

     

    (b)  The
      following provisions apply to all Stock Appreciation Rights that are granted
      in
      connection with Options:

     

    
      
         

      

      
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    (i)  Stock
      Appreciation Rights shall entitle the Participant, upon exercise of all or
      any
      part of the Stock Appreciation Rights, to surrender to the Company unexercised
      that portion of the underlying Option relating to the same number of shares
      of
      Company Stock as is covered by the Stock Appreciation Rights (or the portion
      of
      the Stock Appreciation Rights so exercised) and to receive in exchange from
      the
      Company an amount equal to the excess of (x) the Fair Market Value on the date
      of exercise of the Company Stock covered by the surrendered portion of the
      underlying Option over (y) the exercise price of the Company Stock covered
      by
      the surrendered portion of the underlying Option. The Committee may limit the
      amount that the Participant will be entitled to receive upon exercise of Stock
      Appreciation Rights.

     

    (ii)  Upon
      the
      exercise of a Stock Appreciation Right and surrender of the related portion
      of
      the underlying Option, the Option, to the extent surrendered, shall not
      thereafter be exercisable.

     

    (iii)  Subject
      to any further conditions upon exercise imposed by the Board, a Stock
      Appreciation Right shall be exercisable only to the extent that the related
      Option is exercisable and a Stock Appreciation Right shall expire no later
      than
      the date on which the related Option expires.

     

    (iv)  The
      Stock
      Appreciation Right is only transferable when the related Options are otherwise
      transferable.

     

    (v)  A
      Stock
      Appreciation Right may only be exercised at a time when the Fair Market Value
      of
      the Company Stock covered by the Stock Appreciation Right exceeds the exercise
      price of the Company Stock covered by the underlying Option.

     

    (c)  The
      following provisions apply to all Stock Appreciation Rights that are not granted
      in connection with Options:

     

    (i)  Stock
      Appreciation Rights shall entitle the Participant, upon exercise of all or
      any
      part of the Stock Appreciation Rights, to receive in exchange from the Company
      an amount equal to the excess of (x) the Fair Market Value on the date of
      exercise of the Company Stock covered by the surrendered Stock Appreciation
      Right over (y) the Fair Market Value of the Company Stock on the Date of Grant
      of the Stock Appreciation Right. The Committee may limit the amount that the
      Participant will be entitled to receive upon exercise of Stock Appreciation
      Rights.

     

    (ii)  A
      Stock
      Appreciation Right may only be exercised at a time when the Fair Market Value
      of
      the Company Stock covered by the Stock Appreciation Right exceeds the Fair
      Market Value of the Company Stock on the Date of Grant of the Stock Appreciation
      Right.

     

    (d)  The
      manner in which the Company’s obligation arising upon the exercise of a Stock
      Appreciation Right shall be paid shall be determined by the Committee and shall
      be set forth in the Incentive Award. The Grant Agreement may provide for payment
      in Company Stock or cash, or a fixed combination of Company Stock or cash,
      or
      the Committee may reserve the right to determine the manner of payment at the
      time the Stock Appreciation Right is exercised. Shares of Company Stock issued
      upon the exercise of a Stock Appreciation Right shall be valued at their Fair
      Market Value on the date of exercise.

     

    
      
         

      

      
        12

        
          

        

      

      
         

      

       

    

    (e)  A
      Participant who acquires shares of Company Stock upon exercise of a Stock
      Appreciation Right shall have no rights as a shareholder until the Company
      Stock
      is issued pursuant to the terms of the Grant Agreement and all requirements
      with
      respect to the issuance of such shares have been satisfied.

     

    (f)  Stock
      Appreciation Rights may be exercised by the Participant giving written notice
      of
      the exercise to the Company, stating the number of Stock Appreciation Rights
      the
      Participant has elected to exercise.

     

    (g)  The
      Company may suspend the right to exercise a Stock Appreciation Right at any
      time
      when the Company determines that allowing the exercise and issuance of Company
      Stock would violate any federal or state securities or other laws. The Committee
      may provide that any time periods to exercise the Stock Appreciation Right
      are
      extended during a period of suspension.

     

    (h)  Whenever
      payments upon exercise of Stock Appreciation Rights are to be made in cash
      to a
      Participant who is an employee, the Company (or appropriate Service Recipient,
      as applicable) will withhold therefrom an amount sufficient to satisfy any
      Applicable Withholding Taxes. Each Participant who is an Employee shall agree
      as
      a condition of receiving Stock Appreciation Rights payable in the form of
      Company Stock to pay to the Company, or make arrangements satisfactory to the
      Company regarding the payment to the Company of, Applicable Withholding Taxes.
      Until the amount has been paid or arrangements satisfactory to the Company
      have
      been made, no stock certificate shall be issued to the Participant. Payment
      to
      the Company in satisfaction of Applicable Withholding Taxes may be in cash
      or in
      shares of Company Stock (valued at their Fair Market Value as of the date of
      payment) to which the Participant has good title, free and clear of all liens
      and encumbrances. As an alternative to making a separate payment to the Company
      to satisfy Applicable Withholding Taxes, if the Committee allows or the Grant
      Agreement so provides, the Participant may elect to have the Company retain
      that
      number of shares of Company Stock (valued at their Fair Market Value as of
      the
      date of such retention) that would satisfy all or a specified portion of the
      Applicable Withholding Taxes. The shares of Company Stock retained may not
      exceed the amount of the Applicable Withholding Taxes.

     

    (i)  Unless
      specifically provided in the discretion of the Committee in a writing that
      references and supersedes this Section 9(i), (i) no Modification shall be made
      in respect to any Stock Appreciation Right if such Modification would result
      in
      the Stock Appreciation Right constituting a deferral of compensation, and (ii)
      no Extension shall be made in respect to any Stock Appreciation Right if such
      Extension would result in the Stock Appreciation Right having an additional
      deferral feature from the Date of Grant, in each case within the meaning of
      applicable Treasury Regulations under Code Section 409A. Subject to the
      remaining part of this subsection, (x) a “Modification” means any change in the
      terms of the Stock Appreciation Right (or change in the terms of the Plan or
      applicable Grant Agreement) that may provide the holder of the Stock
      Appreciation Right with a direct or indirect reduction in the exercise price
      of
      the Stock Appreciation Right, regardless of whether the holder in fact benefits
      from the change in terms; and (y) an “Extension” means either (A) the provision
      to the holder of an additional period of time within which to exercise the
      Stock
      Appreciation Right beyond the time originally prescribed, (B) the conversion
      or
      exchange of the Stock Appreciation Right for a legally binding right to
      compensation in a future taxable year, (C) the addition of any feature for
      the
      deferral of compensation to the terms of the Stock Appreciation Right, or (D)
      any renewal of the Stock Appreciation Right that has the effect of (A) through
      (C) above. Notwithstanding the preceding sentence, it shall not be a
      Modification or an Extension, respectively, to change the terms of a Stock
      Appreciation Right in accordance with Section 15 of the Plan, or in any of
      the
      other ways or for any of the other purposes provided in applicable Treasury
      Regulations or other generally applicable guidance under Code Section 409A
      as
      not resulting in a Modification or Extension for purposes of that section.
      In
      particular, it shall not be an Extension to extend the exercise period of a
      Stock Appreciation Right to a date no later than the earlier of (i) the latest
      date upon which the Stock Appreciation Right could have expired by its original
      terms under any circumstances or (ii) the tenth anniversary of the original
      Date
      of Grant.

     

    
      
         

      

      
        13

        
          

        

      

      
         

      

       

    

    10.  Performance
      Grants.

     

    (a)  Each
      Performance Grant shall be evidenced by an agreement (a “Grant Agreement”)
      setting forth the Performance Goals for the award, including the Performance
      Criteria, the target and maximum amounts payable and such other terms and
      conditions as are applicable to the Performance Grant. Each Performance Grant
      shall be granted and administered to comply with the requirements of Code
      Section 162(m). The aggregate maximum cash amount payable under the Plan in
      any
      Taxable Year to any Participant shall not exceed $500,000. In the event of
      any
      conflict between a Grant Agreement and the Plan, the terms of the Plan shall
      govern.

     

    (b)  The
      Committee shall establish the Performance Goals for Performance Grants. The
      Committee shall determine the extent to which any Performance Criteria shall
      be
      used and weighted in determining Performance Grants. The Committee may vary
      the
      Performance Criteria, Performance Goals and weightings from Participant to
      Participant, Performance Grant to Performance Grant and Plan Year to Plan Year.
      The Committee may increase, but not decrease, the minimum and target levels
      (but
      not the maximum level) with respect to any Performance Goal after the start
      of a
      performance period.

     

    (c)  The
      Committee shall establish for each Performance Grant the amount of cash or
      Company Stock payable at specified levels of performance, based on the
      Performance Goal or Goals for each Performance Criteria. Any Performance Grant
      shall be made not later than 90 days after the start of the period for which
      the
      Performance Grant relates and shall be made prior to the completion of 25%
      of
      such period. All determinations regarding the achievement of any Performance
      Goals will be made by the Committee. The Committee may not increase during
      a
      Plan Year the amount of cash or Common Stock that would otherwise be payable
      upon achievement of the Performance Goal or Goals but may reduce or eliminate
      the payments as provided in a Performance Grant.

     

    (d)  The
      actual payments to a Participant under a Performance Grant will be calculated
      by
      applying the achievement of a Performance Criteria to the Performance Goal
      as
      established in the Grant Agreement. All calculations of actual payments shall
      be
      made by the Committee and the Committee shall certify in writing the extent,
      if
      any, to which the Performance Goals have been met.

     

    
      
         

      

      
        14

        
          

        

      

      
         

      

       

    

    (e)  Performance
      Grants will be paid in cash, Company Stock or both, at such time or times as
      are
      provided in the Grant Agreement. The Committee may provide in the Grant
      Agreement that the Participant may make a prior election to defer the payment
      under a Performance Grant subject to such terms and conditions as the Committee
      may determine.

     

    (f)  Nothing
      contained in the Plan will be deemed in any way to limit or restrict any Company
      or the Committee from making any award or payment to any person under any other
      plan, arrangement or understanding, whether now existing or hereafter in
      effect.

     

    (g)  A
      Participant who receives a Performance Grant payable in Company Stock shall
      have
      no rights as a shareholder until the Company Stock is issued pursuant to the
      terms of the Performance Grant. The Company Stock may be issued without cash
      consideration.

     

    (h)  A
      Participant’s interest in a Performance Grant may not be sold, assigned,
      transferred, pledged, hypothecated, or otherwise encumbered.

     

    (i)  Whenever
      payments under a Performance Grant are to be made in cash, the Company will
      withhold therefrom an amount sufficient to satisfy any Applicable Withholding
      Taxes. Each Participant shall agree as a condition of receiving a Performance
      Grant payable in the form of Company Stock, to pay to the Company, or make
      arrangements satisfactory to the Company regarding the payment to the Company
      of, Applicable Withholding Taxes. Until such amount has been paid or
      arrangements satisfactory to the Company have been made, no stock certificate
      shall be issued to such Participant. As an alternative to making a cash payment
      to the Company to satisfy Applicable Withholding Taxes, if the grant so permits,
      the Participant may elect to (i) to deliver Mature Shares (valued at their
      Fair
      Market Value) or (ii) to have the Company retain that number of shares of
      Company Stock (valued at their Fair Market Value) that would satisfy all or
      a
      specified portion of the Applicable Withholding Taxes.

     

    11.  Method
      of Exercise of Options and Stock Appreciation Rights.

     

    (a)  Options
      and Stock Appreciation Rights may be exercised by the Participant giving written
      notice of the exercise to the Company, stating the number of shares the
      Participant has elected to purchase under the Option or the number of Stock
      Appreciation Rights the Participant has elected to exercise. In the case of
      the
      purchase of shares under an Option, such notice shall be effective only if
      accompanied by the exercise price in full in cash; provided, however, that
      if
      the terms of an Option so permit, the Participant may (i) deliver Mature Shares
      (valued at their Fair Market Value) in satisfaction of all or any part of the
      exercise price or a certificate of ownership of such Mature Shares, (ii) cause
      to be withheld from the Option shares, shares of Company Stock (valued at their
      Fair Market Value) in satisfaction of all or any part of the exercise price,
      or
      (iii) deliver a properly executed exercise notice together with irrevocable
      instructions to a broker to deliver promptly to the Company, from the sale
      or
      loan proceeds with respect to the sale of Company Stock or a loan secured by
      Company Stock, the amount necessary to pay the exercise price and, if required
      by the terms of the Option, Applicable Withholding Taxes, or (iv) such other
      methods of payment as the Committee, at its discretion, deems
      appropriate.

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

       

    

    (b)  The
      Company may place on any certificate representing Company Stock issued upon
      the
      exercise of an Option or a Stock Appreciation Right any legend deemed desirable
      by the Company’s counsel to comply with federal or state securities laws, and
      the Company may require a customary written indication of the Participant’s
      investment intent. Until the Participant has made any required payment,
      including any Applicable Withholding Taxes, and has had issued a certificate
      for
      the shares of Company Stock acquired, he or she shall possess no shareholder
      rights with respect to the shares.

     

    (c)  Each
      Participant shall agree as a condition of the exercise of an Option or a Stock
      Appreciation Right, to pay to the Company, or make arrangements satisfactory
      to
      the Company regarding the payment to the Company of, Applicable Withholding
      Taxes. Until such amount has been paid or arrangements satisfactory to the
      Company have been made, no stock certificate shall be issued upon the exercise
      of an Option or cash paid upon the exercise of a Stock Appreciation
      Right.

     

    (d)  As
      an
      alternative to making a cash payment to the Company to satisfy Applicable
      Withholding Taxes, if the Option or Stock Appreciation Rights agreement so
      provides, the Participant may elect to (i) to deliver Mature Shares (valued
      at
      their Fair Market Value) or (ii) to have the Company retain that number of
      shares of Company Stock (valued at their Fair Market Value) that would satisfy
      all or a specified portion of the Applicable Withholding Taxes.

     

    12.  Transferability
      of Options and Stock Appreciation Rights.
      Nonstatutory Stock Options and Stock Appreciation Rights may be transferable
      by
      a Participant and exercisable by a person other than the Participant, but only
      to the extent specifically provided in the Incentive Award. Incentive Stock
      Options, by their terms, shall not be transferable except by will or by the
      laws
      of descent and distribution and shall be exercisable, during the Participant’s
      lifetime, only by the Participant.

     

    13.  Effective
      Date of the Plan.
      This
      Plan was approved by the Board on February 26, 2008, and will become
      effective on April 29, 2008, subject to approval by the affirmative vote of
      the
      holders of a majority of the votes cast at the 2008 Annual Meeting of the
      Company’s shareholders.

     

    14.  Termination,
      Modification, Change.
      If not
      sooner terminated by the Board, this Plan shall terminate at the close of
      business on the date immediately preceding the tenth anniversary of the
      Effective Date. No Incentive Awards shall be made under the Plan after its
      termination. The Board may amend or terminate the Plan in such respects as
      it
      shall deem advisable; provided that, if and to the extent required by the Code
      or by requirements of the NASDAQ Stock Market, no change shall be made that
      increases the total number of shares of Company Stock reserved for issuance
      pursuant to Incentive Awards granted under the Plan (except pursuant to Section
      15), materially modifies the requirements as to eligibility for participation
      in
      the Plan, materially increases the benefits accruing to Participants under
      the
      Plan, or expands the types of Incentive Awards provided under the Plan, unless
      such change is authorized by the shareholders of the Company. The Board may
      unilaterally amend Incentive Awards with respect to Participants, and the Plan
      subject to the limitations described in the preceding sentence, as it deems
      appropriate to ensure compliance with Rule 16b-3 and to cause the Plan and
      any
      Incentive Awards to meet the requirements of the Code and regulations and other
      interpretation and guidance issued thereunder, including but not limited to
      Code
      Section 409A. Except as provided in the preceding sentence, a termination or
      amendment of the Plan shall not, without the consent of the Participant,
      adversely affect a Participant’s rights under an Incentive Award previously
      granted to him or her.

     

    
      
         

      

      
        16

        
          

        

      

      
         

      

       

    

    15.  Change
      in Capital Structure.

     

    (a)  In
      the
      event of a stock dividend, stock split or combination of shares,
      recapitalization or merger in which the Company is the surviving corporation
      or
      other change in the Company’s capital stock (including, but not limited to, the
      creation or issuance to shareholders generally of rights, options or warrants
      for the purchase of common stock or preferred stock of the Company), the number
      and kind of shares of stock or securities of the Company to be subject to the
      Plan and to Incentive Awards then outstanding or to be granted thereunder,
      the
      maximum number of shares or securities which may be delivered under the Plan
      (including the maximum limit on Incentive Stock Options and other Incentive
      Awards under Section 4), the maximum number of shares or securities that can
      be
      granted to an individual Participant under Section 4, the exercise price of
      Options, the initial Fair Market Value of Company Stock under Stock
      Appreciation. Rights, and other relevant terms of the Plan and any Incentive
      Awards shall be proportionately adjusted by the Committee, whose determination
      shall be binding on all persons. If the adjustment would produce fractional
      shares with respect to any unexercised Option or Stock Appreciation Right or
      fractional cents with respect to the exercise price thereof, the Committee
      shall
      round down the number of shares covered by the Option or Stock Appreciation
      Right to the nearest whole share and round up the exercise price to the nearest
      whole cent.

     

    (b)  In
      the
      event of a Change in Control, or if the Company is otherwise a party to a
      consolidation or a merger in which the Company is not the surviving corporation,
      a transaction that results in the acquisition of substantially all of the
      Company’s outstanding stock by a single person or entity, or a sale or transfer
      of substantially all of the Company’s assets occurs, then the Committee may take
      any actions with respect to outstanding Incentive Awards as the Committee deems
      appropriate, consistent with applicable provisions of the Code and any
      applicable federal or state securities laws.

     

    (c)  Notwithstanding
      anything in the Plan to the contrary, the Committee may take the foregoing
      actions without the consent of any Participant, and the Committee’s
      determination shall be conclusive and binding on all persons for all
      purposes.

     

    16.  Administration
      of the Plan.

     

    (a)  The
      Plan
      shall be administered by the Committee. Subject to the express provisions and
      limitations set forth in this Plan, the Committee shall be authorized and
      empowered to do all things necessary or desirable, in its sole discretion,
      in
      connection with the administration of this Plan, including, without limitation,
      the following:

     

    
      
         

      

      
        17

        
          

        

      

      
         

      

       

    

    (i)  to
      prescribe, amend and rescind rules and regulations relating to this Plan and
      to
      define terms not otherwise defined herein;

     

    (ii)  to
      determine which persons are Participants, to which of such Participants, if
      any,
      Incentive Awards shall be granted hereunder and the timing of any such Incentive
      Awards, and to grant Incentive Awards;

     

    (iii)  to
      grant
      Incentive Awards to Participants and determine the terms and conditions thereof,
      including the number of shares of Company Stock subject to Incentive Awards
      and
      the exercise or purchase price of such shares of Company Stock and the
      circumstances under which Incentive Awards become exercisable or vested or
      are
      forfeited or expire, which terms may but need not be conditioned upon the
      passage of time, continued employment, the satisfaction of Performance Goals,
      the occurrence of certain events, or other factors;

     

    (iv)  to
      establish or verify the extent of satisfaction of any Performance Goals or
      other
      conditions applicable to the grant, issuance, exercisability, vesting and/or
      ability to retain any Incentive Award;

     

    (v)  to
      prescribe and amend the terms of the award agreements or other documents
      evidencing Incentive Awards made under this Plan (which need not be
      identical);

     

    (vi)  to
      determine whether, and the extent to which, adjustments are required pursuant
      to
      Section 15;

     

    (vii)  to
      interpret and construe this Plan, any rules and regulations under this Plan
      and
      the terms and conditions of any Incentive Award granted hereunder, and to make
      exceptions to any such provisions in good faith and for the benefit of the
      Company; and

     

    (viii)  to
      make
      all other determinations deemed necessary or advisable for the administration
      of
      this Plan.

     

    Notwithstanding
      the foregoing, no “tandem stock options” (where two stock options are issued
      together and the exercise of one option affects the right to exercise the other
      option) may be issued in connection with Incentive Stock Options.

     

    The
      Committee is expressly given the power to amend the terms of previously granted
      Incentive Awards so long as the terms as amended are consistent with the terms
      of the Plan and provided that the consent of the Participant is obtained with
      respect to any amendment that would be detrimental to him or her, except that
      the consent will not be required if the amendment is for the purpose of
      complying with applicable provisions of the Code or any federal or state
      securities laws.

     

    The
      Committee is expressly prohibited from Repricing any Option or Stock
      Appreciation Right without the prior approval of the shareholders of the Company
      with respect to the proposed Repricing.

     

    
      
         

      

      
        18

        
          

        

      

      
         

      

       

    

    (b)  The
      interpretation and construction of any provision of the Plan by the Committee
      shall be final and conclusive as to any Participant. The Committee may consult
      with counsel, who may be counsel to the Company, and shall not incur any
      liability for any action taken in good faith in reliance upon the advice of
      counsel.

     

    (c)  A
      majority of the members of the Committee shall constitute a quorum, and all
      actions of the Committee shall be taken by a majority of the members present.
      Any action may be taken by a written instrument signed by all of the members,
      and any action so taken shall be fully effective as if it had been taken at
      a
      meeting.

     

    (d)  The
      Committee may delegate the administration of the Plan to an officer or officers
      of the Company, and such administrator(s) may have the authority to execute
      and
      distribute agreements or other documents evidencing or relating to Incentive
      Awards granted by the Committee under this Plan, to maintain records relating
      to
      the grant, vesting, exercise, forfeiture or expiration of Incentive Awards,
      to
      process or oversee the issuance of shares of Company Stock upon the exercise,
      vesting and/or settlement of an Incentive Award, to interpret the terms of
      Incentive Awards and to take such other actions as the Committee may specify,
      provided that in no case shall any such administrator be authorized to grant
      Incentive Awards under the Plan. Any action by any such administrator within
      the
      scope of its delegation shall be deemed for all purposes to have been taken
      by
      the Committee and references in this Plan to the Committee shall include any
      such administrator, provided that the actions and interpretations of any such
      administrator shall be subject to review and approval, disapproval or
      modification by the Committee.

     

    17.  Notice.
      All
      notices and other communications required or permitted to be given under this
      Plan shall be in writing and shall be deemed to have been duly given if
      delivered personally or mailed first class, postage prepaid, as follows (a)
      if
      to the Company—at the principal business address of the Company to the attention
      of the Corporate Secretary of the Company; and (b) if to any Participant—at the
      last address of the Participant known to the sender at the time the notice
      or
      other communication is sent.

     

    18.  Interpretation.
      The
      Plan is intended to operate in compliance with the provisions of Rule 16b-3
      and
      to facilitate compliance with, and optimize the benefits from, Code Section
      162(m). The terms of this Plan are subject to all present and future regulations
      and rulings of the Secretary of the Treasury of the United States or his or
      her
      delegate relating to the qualification of Incentive Stock Options under the
      Code. This Plan and the individual Incentive Awards under the Plan are intended
      to comply with any applicable requirements of Code Section 409A and shall be
      interpreted to the extent context reasonably permits in accordance with such
      requirements. If any provision of the Plan conflicts with any such regulation
      or
      ruling, then that provision of the Plan shall be void and of no
      effect.

     

    19.  General
      Provisions.

     

    (a)  The
      adoption of this Plan and any setting aside of cash amounts or shares of Company
      Stock by the Company with which to discharge its obligations hereunder shall
      not
      be deemed to create a trust or other funded arrangement. The benefits provided
      under this Plan shall be a general, unsecured obligation of the Company payable
      solely from the general assets of the Company, and neither a Participant nor
      a
      Participant’s permitted transferees or estate shall have any interest in any
      assets of the Company by virtue of this Plan, except as a general unsecured
      creditor of the Company. Notwithstanding the foregoing, the Company shall have
      the right to implement or set aside funds in a grantor trust subject to the
      claims of the Company’s creditors to discharge its obligations under the
      Plan.

     

    
      
         

      

      
        19

        
          

        

      

      
         

      

       

    

    (b)  The
      adoption of the Plan shall not affect any other stock incentive or other
      compensation plans in effect for the Company or any subsidiary of the Company,
      nor shall the Plan preclude the Company from establishing any other forms of
      stock incentive or other compensation for employees or Outside Directors of
      the
      Company or any subsidiary of the Company.

     

    (c)  The
      Plan
      shall be binding upon the Corporation, its successors and assigns, and the
      Participant, his executor, administrator and permitted transferees and
      beneficiaries.

     

    (d)  This
      Plan
      and any award agreements or other documents entered into in connection with
      the
      Plan shall be interpreted and construed in accordance with the laws of the
      Commonwealth of Virginia and applicable federal law.

     

    
      
         

      

      
        20Executive
      Employment Agreement

     

    This
      Executive Employment Agreement (the “Agreement”)
      is
      effective as of August 30, 2008, by and between Micromet,
      Inc.
      (hereinafter the “Company”)
      and
      Barclay Phillips (hereinafter “Executive”).

     

    Whereas,
      the
      Company desires to employ Executive to provide personal services to the Company,
      and wishes to provide Executive with certain compensation and benefits in return
      for his services; and

     

    Whereas,
      Executive wishes to be employed by the Company and provide personal services
      to
      the Company in return for certain compensation and benefits; 

     

    Now,
      therefore,
      in
      consideration of the mutual promises and covenants contained herein, the parties
      hereto agree as follows:

     

    
      	
              1.

            	
              Employment
                by the Company

            

    

     

    1.1 Position.
      Subject
      to terms set forth herein, the Company agrees to employ Executive in the
      position of Senior Vice President and Chief Financial Officer, and Executive
      hereby accepts such employment. During his employment with the Company,
      Executive will devote his best efforts and substantially all of his time and
      attention to the business of the Company, except as provided in Section 4 and
      Exhibit E below and for vacation periods and reasonable periods of illness
      or
      other incapacities in accordance with the Company’s general employment
      policies.

     

    1.2 Duties.
      Executive will serve in an executive capacity performing such duties as are
      normally associated with his then current position and such duties as are
      assigned to him from time to time, subject to the oversight and direction of
      the
      Chief Executive Officer and the Company’s Board of Directors (the “Board”) or a
      Committee thereof. Upon termination of this Agreement pursuant to Section
6,
      Executive agrees to resign from all functions which he exercised or assumed
      on
      the basis of or in connection with Executive’s employment by the Company,
      including as a director or officer of the Company or its subsidiaries, subject
      to any applicable legal requirements regarding such resignation.

     

    1.3 Location. Executive’s
      primary office location will be at the Company’s US corporate offices, currently
      in Bethesda, MD.
      The
      Company reserves the right to reasonably require Executive to perform his duties
      at places other than at his primary office location from time to time, and
      to
      require reasonable business travel.
      In
      order to facilitate Executive’s relocation from his current domicile to the
      Bethesda area, the Company will make available to Executive the relocation
      benefits set forth in Exhibit
      D.

     

    1.4 Term. The
      term
      of this
      Agreement will commence on August 30, 2008 (the “Start
      Date”),
      and
      will continue until terminated
      by
      Executive or the Company in accordance with Section 6. 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    1.5 Policies
      and Procedures.
      The
      employment relationship between the parties will also be subject to the
      Company’s personnel policies and procedures as they may be interpreted, adopted,
      revised or deleted from time to time in the Company’s sole discretion. If the
      terms of this Agreement differ from or are in conflict with the Company’s
      personnel policies or procedures, this Agreement will control.

     

    
      	
              2.

            	
              Compensation

            

    

     

    2.1 Base
      Salary. For
      services rendered hereunder by Executive pursuant to this Agreement, Executive
      will receive an annualized base salary of three hundred thousand US dollars
      (US$300,000) as may be increased from time to time by the Compensation Committee
      of the Board at its discretion (the “Base
      Salary”),
      payable in accordance with the Company’s regular payroll schedule (but not less
      frequently than monthly), less any payroll withholding and deductions in
      accordance with applicable law and the Company’s general employment policies or
      practices. 

     

    2.2 Bonus.
      Executive will participate in the Company’s Management Incentive Compensation
      Plan (the “MICP”)
      adopted by the Company from time to time or in such other bonus plan as the
      Board may approve for the senior executive officers of the Company. Except
      as
      otherwise provided in this Agreement, Executive’s participation in and benefits
      under any such plan will be on the terms and subject to the conditions specified
      in the governing document of the particular plan. 

     

    2.3 Standard
      Company Benefits. 

     

    (a) The
      Executive will be eligible to participate on the same basis as similarly
      situated employees in the Company’s benefit plans in effect from time to time
      during his employment. All matters of eligibility for coverage or benefits
      under
      any benefit plan will be determined in accordance with the provisions of such
      plan. The Company reserves the right to change, alter, or terminate any benefit
      plan in its sole discretion. 
      Until
      such time as Executive is eligible to participate in the Company’s health
      insurance plan, the Company will reimburse Executive his payments for a
      continuation of his current health insurance pursuant to COBRA or any applicable
      state continuation
      coverage
      laws.

     

    (b) Executive
      is entitled to annual paid time off (“PTO”) in accordance with the Company’s
      standard policies and as otherwise provided for senior executive officers,
      but
      in no event less than twenty (20) working days. Working days are all calendar
      days with the exception of Saturdays, Sundays and the designated Company
      holidays. Executive will coordinate the periods of PTO reasonably in advance
      with the other executive officers of the Company, and the timing of such PTO
      will be subject to the prior approval of the Chief Executive
      Officer.

     

    2.4 Insurance. The
      Company will reimburse Executive for the cost of his AD&D and life insurance
      in place as of the date of this Agreement, or corresponding insurance coverage
      by different insurers at comparable or lesser cost.
      In
      addition, the
      Company will have the right to take out life, health, accident, “key-man” or
      other insurance covering Executive, in the name of the Company and at the
      Company’s expense and for the Company’s benefit, in any amount deemed
      appropriate by the Company. Executive will assist the Company in obtaining
      such
      insurance, including, without limitation, submitting to any required
      examinations and providing information and data required by insurance
      companies.

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    2.5 Business
      Expenses.
      The
      Company will reimburse Executive for reasonable Company-related travel,
      entertainment, professional licensing, continuing education and other expenses
      reasonably incurred by Executive on behalf of the Company pursuant to the
      Company’s expense reimbursement policy for its employees.

     

    2.6 Equity
      Compensation. 

     

    (a) Initial
      Stock Option. Subject
      to approval by the Board of Directors of the Company, on the first day of the
      month following the Start Date (the “Grant
      Date”),
      Executive will be granted an option to purchase 300,000 shares of Common Stock
      of the Company (the “Initial
      Stock Option”).
      The
      Initial Stock Option will have an exercise price equal to the fair market value
      of the Company’s Common Stock on the date preceding the Grant Date. The Initial
      Stock Option will be granted as an incentive stock option to the maximum extent
      permitted by law, and otherwise will be a non-qualified stock option. The
      Initial Stock Option will be subject to the Micromet, Inc. Amended and Restated
      2003 Equity Incentive Award Plan (the “Plan”)
      and
      the Company’s standard form of stock option agreement, which Executive will be
      required to execute as a condition to this grant. The
      Initial Stock Option will vest over a four-year period, with 25% of the shares
      subject to the Initial Stock Option vesting on the 12 month anniversary date
      of
      the date of this Agreement, and 1/48 of the shares subject to the Initial Stock
      Option vesting on a monthly basis thereafter. 

     

    (b) Participation
      in Future Grants. In
      addition to the Initial Stock Option, Executive will be eligible to participate
      in any equity or other employee benefit plan that is generally available to
      senior executive officers of the Company. Except as otherwise provided in this
      Agreement, Executive’s participation in and benefits under any such plans will
      be on the terms and subject to the conditions specified in the governing
      document of the particular plan.

     

    (c) Acceleration
      of Vesting.
      The
      provisions concerning vesting pursuant to clauses (i), (ii) and (iii) below
      will
      be cumulative, and are hereby deemed to be a part of all stock options,
      including the Initial Stock Option, restricted stock and such other awards
      granted pursuant to the Company’s stock option and equity incentive award plans
      or agreements and any shares of stock issued upon exercise thereof, (each a
      “Stock
      Award”)
      and to
      supersede any less favorable provision in any agreement or plan regarding such
      Stock Award.

     

    (i) If
      Executive’s employment is terminated by the Company without Cause, by Executive
      for Good Reason, or as a result of Executive’s death or Disability (all as
      defined in Section 6 below), Executive’s
      outstanding unvested Stock Awards that would have vested over the twelve (12)
      month period following the date of termination had Executive remained
      continuously employed by the Company during such period, will be automatically
      vested and exercisable on the date of termination. For purposes of this Section
      6.2(c), the definition of Cause, Good Reason and Disability in Section 6 of
      this
      Agreement supersedes any such definitions in the Plan.

     

    (ii) On
      the
      effective date of a Change of Control (as defined in the Plan), fifty percent
      (50%) of Executive’s outstanding unvested Stock Awards will be automatically
      vested and exercisable.
      The
      portion of any outstanding Stock Award that remains unvested after the
      application of the accelerated vesting under this Section will continue to
      vest
      on the same schedule, but the number of shares vesting on each installment
      will
      be reduced on a pro rata basis to take into account the accelerated vesting
      herein. 

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    (iii) If
      this
      Agreement is terminated by the Company without Cause or by Executive for Good
      Reason within six (6) months prior to or twenty-four (24) months following
      a
      Change of Control, all of Executive’s outstanding unvested Stock Awards will be
      automatically vested and exercisable on the later of the date of termination
      or
      the Change of Control. Such Stock Awards will be fully vested and exercisable
      at
      the exercise price of the previously terminated Stock Awards, provided that
      Executive agrees to exercise such Stock Awards within the then current calendar
      year. If any such unvested Stock Awards have been terminated, the Company will
      make a cash payment to the Executive equal to the economic value of the
      terminated Stock Award to Executive at the time of the Change of Control
      (calculated for stock options as the difference between the exercise price
      of
      the option and the fair market value of the shares underlying the option at
      the
      time of the Change of Control, and for stock awards as the fair market value
      of
      the shares at the time of the Change of Control).

     

    
      	
              3.

            	
              D&O
                Insurance
                and Indemnification

            

    

     

    3.1 D&O
      Insurance. The
      Company
      will
      obtain and maintain at the Company’s expense during the term of this Agreement
      and for six (6) years thereafter liability insurance for the directors and
      officers of the Company (D&O insurance) in the amount of at least US$ 10
      million for any acts or omissions of Executive covered by the applicable
      insurance policy.

     

    3.2 Indemnification.
      The
      Company and Executive will enter into a separate indemnification agreement,
      and
      the Company will indemnify Executive in accordance with the terms of such
      agreement.

     

    
      	
              4.

            	
              Outside
                Activities During
                Employment

            

    

     

    4.1 Exclusive
      Employment. Except
      pursuant to a consulting agreement with Vector Fund Management, which is subject
      to the approval of the Board, Executive will not to engage in any business
      activity which, in the reasonable judgment of the Chief Executive Officer,
      is
      likely to interfere with Executive’s ability to discharge his duties and
      responsibilities to the Company. Executive may engage in civic and
      not-for-profit activities, and participate in industry associations so long
      as
      such activities do not materially interfere with the performance of his duties
      hereunder. Executive agrees that he will not join any boards, other than
      community and civic boards and boards of industry associations which do not
      interfere with his duties to the Company, without the prior approval of
      the Board. 

     

    4.2 No
      Adverse Interests.
      Except
      as permitted by Section 4.3, Executive agrees not to acquire, assume or
      participate in, directly or indirectly, any position, investment or interest
      known by him to be adverse or antagonistic to the Company, its business or
      prospects, financial or otherwise,
      or
      engage in any business that creates a conflict of interest with his duties
      of
      loyalty to the Company.

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

     

    4.3 Non-Competition
      during Term of Agreement.
      During
      the term of this Agreement, except on behalf of the Company or as expressly
      authorized by the Board, Executive will not directly or indirectly, whether
      as
      an officer, director, stockholder, partner, proprietor, associate,
      representative, consultant, or in any capacity whatsoever engage in, become
      financially interested in, be employed by or have any business connection with
      any other person, corporation, firm, partnership or other entity whatsoever
      which were known by him to compete directly with the Company, throughout the
      world, in any line of business engaged in (or planned to be engaged in) by
      the
      Company; provided,
      however,
      that
      anything above to the contrary notwithstanding, he or his immediate family
      may
      own, as a passive investor, securities of any competitor corporation, so long
      as
      his direct holdings in any one such corporation will not in the aggregate
      constitute more than one percent (1%) of the voting stock of such
      corporation. 

     

    
      	
              5.

            	
              Proprietary
                Information Obligations

            

    

     

    As
      a
      condition of employment, Executive agrees to execute and abide by the
      Proprietary Information and Inventions Agreement attached hereto as Exhibit A,
      which
      may be amended by the parties from time to time without regard to this
      Agreement. The Proprietary Information and Inventions Agreement contains
      provisions that are intended by the parties to survive and that do survive
      termination or expiration of this Agreement.

     

    
      	
              6.

            	
              Termination
                Of Employment

            

    

     

    The
      parties acknowledge that Executive’s employment with the Company is terminable
      at will. The provisions of in this Section governing the amount of compensation,
      if any, to be provided to Executive upon termination of employment do not alter
      this at will status.

     

    6.1 Termination
      by the Company for Cause

     

    (a) The
      Company may terminate this Agreement at any time for Cause by written notice
      to
      Executive
      effective upon receipt. “Cause”
means
      that the Board of Directors has determined in good
      faith
      that
      Executive has engaged in any of the following: (i) a material breach of this
      Agreement or any other written agreement between Executive and the Company;
      (ii)
      gross negligence or gross misconduct in the performance of his duties; (iii)
      the
      commission of any act or omission constituting dishonesty or fraud that is
      injurious to the Company or any successor or affiliate thereof; (iv) any
      conviction of, or plea of “guilty’ or “no contest” to, a felony; (v) conduct by
      Executive which demonstrates gross unfitness to serve; (vi) failure to attempt
      in good faith to implement a clear, reasonable and legal directive of the
      Company’s Chief Executive Officer, the Board or any Board committee; (vii)
      persistent and
      severe
      unsatisfactory performance of job duties; or (viii) breach of a fiduciary
      duty.

     

    (b) If
      the
      Company terminates this Agreement for Cause, the Company will pay Executive
      (i)
      the Base Salary due Executive through the date of termination, and (ii) for
      any
      accrued PTO not taken at the time of termination. Executive will not be entitled
      to receive any Severance Benefits (as defined in Section 6.2 below), unpaid
      bonuses or other compensation, except as set forth in Section 6.1(c) below.
      

     

    (c) If
      the
      Company terminates this Agreement for Cause solely on the basis of Section
      6.1(a)(vii) above, provided that Executive executes and does not revoke a
      Release as provided in Section 7 and complies with Section 6.7(b), the Company
      will pay Executive, in lieu of any other severance benefits, an amount equal
      to
      three (3) months of Executive’s Base Salary on the date of termination. The
      payment due pursuant to this Section 6.1(c) will be payable as a lump sum
      payment no later than the first business day following the date on which
      Executive’s right to revoke any waiver and release of legal claims has expired.
      In addition, Executive’s outstanding unvested Stock Awards that would have
      vested over the three (3) month period following the date of termination had
      Executive remained continuously employed by the Company during such period,
      will
      be automatically vested and exercisable on the date of termination.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

     

    6.2 Termination
      by the Company without Cause.

     

    (a) The
      Company may terminate this Agreement at any time without Cause by written notice
      to Executive effective upon receipt or on a later termination date agreed with
      Executive.

     

    (b) If
      the
      Company terminates Executive’s employment without Cause, the Company will pay
      Executive (i) the Base Salary due Executive through the date of termination,
      (ii) for any accrued PTO not taken at the time of termination, and (iii) any
      other amounts to which Executive is entitled at the time of termination under
      any bonus or compensation plan or practice of the Company; provided,
      however, that
      any
      bonus payments under the MICP will be governed by Section 6.2(c)(ii) below
      and
      not this Section.

     

    (c) In
      addition, and provided that Executive executes and does not revoke a Release
      as
      provided in Section 7 and complies with Section 6.7(b), the Company will pay
      or
      grant Executive, in lieu of any other severance benefits or any other
      compensation, the benefits set forth in this subsection (c) below (“Severance
      Benefits”);
      provided,
      however,
      that if
      the Company has established any compensation plan or severance benefit that
      is
      more favorable to Executive than any of the Severance Benefits, the Company
      will
      pay to Executive such more favorable benefit in lieu of the corresponding
      Severance Benefit set forth below:

     

    (i) An
      amount
      equal to the Base Salary for a period of twelve (12) months from the date of
      termination, less any payroll withholding and deductions due on such salary
      in
      accordance with applicable law, payable as a lump sum payment no later than
      the
      first business day following the date on which Executive’s right to revoke any
      waiver and release of legal claims has expired;

     

    (ii) If,
      at
      the time of termination of this Agreement, the Company has not yet paid to
      the
      Executive a bonus under the MICP for the year preceding the year in which this
      Agreement is terminated, the Executive will be eligible for such bonus on the
      same basis as other executive level employees, and if other executive level
      employees receive a bonus under the MICP for the preceding year, the Company
      will pay Executive the bonus pursuant to the MICP; provided,
      however,
      that the
      percentage of the Company’s achievement of corporate goals which is used in the
      calculation of a portion of such bonus, will be the same as the percentage
      established by the compensation committee of the Board for other executive
      level
      employees; and provided
      further that
      the
      percentage of Executive’s achievement of his personal goals for the preceding
      year, which is used in the calculation of a portion of such bonus, will not
      be
      less than the average of the percentages achieved in the preceding three (3)
      years.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

     

    (iii) A
      Bonus
      for the year in which this Agreement is terminated prorated for the period
      during such year Executive was employed prior to the date of termination (or
      the
      full amount of the Bonus if Executive’s employment is terminated within six (6)
      months prior to or twelve (12) months following a Change of Control), payable
      as
      a lump sum payment no later than the first business day following the date
      on
      which Executive’s right to revoke any waiver and release of legal claims has
      expired; “Bonus”
means
      the average of the bonuses awarded to Executive for each of the three (3) fiscal
      years prior to the date of termination, or such lesser number of years as may
      be
      applicable if Executive has not been employed for three (3) full years on the
      date of termination. For purposes of determining Executive’s Bonus, to the
      extent Executive received no bonus in a year in which other executives received
      bonuses, such year will still be taken into account (using zero (0) as the
      applicable bonus) in determining Executive’s Bonus, but if Executive did not
      receive a bonus for a year in which no executive received a bonus, such year
      will not be taken into account and if any portion of the bonuses awarded to
      Executive consisted of securities or other property, the fair market value
      thereof will be determined in good faith by the Board;

     

    (iv) Acceleration
      of vesting of Stock Awards pursuant to the applicable subsection of Section
      2.6(c);

     

    (v) During
      the period beginning on the first business day following the date on which
      Executive’s right to revoke any waiver and release of legal claims has expired
      and ending on the earlier of the date (1) which is twelve (12) months following
      the date of termination or (2) on which Executive has accepted a full time
      position, executive-level outplacement services at the Company’s expense, not to
      exceed US$15,000, by a firm selected by Executive from a list compiled by the
      Company;

     

    (vi) Provided
      the Executive is participating the Company’s health insurance plan on the
      termination date, for the period beginning on the date of termination and ending
      on the date which is twelve (12) full months following the date of termination
      (or, if earlier, the date on which the applicable continuation period under
      the
      Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
      (“COBRA”)
      or
      applicable state continuation coverage law expires), reimburse Executive (1)
      for
      the costs associated with continuation coverage pursuant to COBRA or applicable
      state continuation coverage laws, for Executive and his eligible dependents
      who
      were covered under the Company’s health insurance plans as of the date of the
      termination of this Agreement (provided that Executive will be solely
      responsible for all matters relating to his continuation of coverage pursuant
      to
      COBRA or any corresponding state law, including, without limitation, his
      election of such coverage and his timely payment of premiums), or (2) if
      Executive is participating the Company’s health insurance plans on the
      termination date and is not eligible for continuation coverage pursuant to
      either COBRA or any corresponding state law, for the premiums for conversion
      coverage if available, otherwise for the premiums of any health insurance with
      coverage comparable to that under the Company’s health insurance plans for
      Executive and his eligible dependents who were covered under the Company’s
      health insurance plans as of the date of the termination of this Agreement
      in
      either case up to a maximum of 2 times the premium paid by the Company on the
      Executive’s behalf under the Company’s plan; and

     

    (vii) For
      the
      period beginning on the date of termination and ending on the date which is
      twelve (12) full months following the date of termination, pay to Executive
      the
      amount of any life insurance
      premiums it was paying prior to the date of the termination of this
      Agreement.

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

     

    (d) The
      Company will have the right to withhold further payments of unpaid Severance
      Benefits upon its notice to Executive of the Board’s good faith reasonable
      belief, and the basis for the reasonable belief, that Executive has breached
      any
      of his post-termination obligations to the Company under applicable laws and
      as
      defined in this Agreement and the PIIA.

     

    6.3 Termination
      by Executive for Good Reason.

     

    (a) If
      Executive has not previously received a notice of termination from the Company,
      Executive may terminate this Agreement at any time for Good Reason by written
      notice to the Company as provided below.“Good
      Reason”
means:
      (i) any material diminution of Executive’s authority, duties or
      responsibilities; (ii) any reduction by the Company in Executive’s Base Salary;
      (iii) a relocation of Executive’s place of employment to a location in excess of
      50 miles from the Company’s current offices in Bethesda, MD; (iv) any material
      breach of this Agreement by the Company; (v) any failure to pay Executive the
      earned bonus for any period under the MICP or any other bonus or incentive
      plan
      adopted by the Company, if a majority of other officers of the Company or any
      successor or affiliate have been paid bonuses for such period under such plan,
      which, for purposes of this provision, will be a material breach of this
      Agreement; or (vi) any failure by the Company to obtain the assumption of this
      Agreement by any successor or assign of the Company which, for purposes of
      this
      provision, will be a material breach of this Agreement.
      Notwithstanding the foregoing, any actions taken by the Company to accommodate
      a
      disability of Executive or pursuant to the Family and Medical Leave Act or
      an
      applicable state leave law will not be a Good Reason for purposes of this
      Agreement; provided,
      however,
      that it
      will only be deemed Good Reason if (i) the Company is given written notice
      from
      Executive within ninety (90) days following the first occurrence of a condition
      that Executive considers to constitute Good Reason describing the condition
      and
      the Company fails to remedy such condition within thirty (30) days following
      such written notice, and (ii) Executive resigns from employment effective on
      a
      date that is within ninety (90) days following the end of the period within
      which the Company was entitled to remedy the condition constituting Good Reason
      but failed to do so. 

     

    (b) If
      Executive terminates this Agreement for Good Reason, the Company will pay
      Executive (i) the Base Salary due Executive through the date of termination,
      (ii) for any accrued PTO not taken at the time of the receipt of the notice
      of
      termination, and (iii) any other amounts to which Executive is entitled at
      the
      time of termination under any bonus or compensation plan or practice of the
      Company
      provided, however, that
      any
      bonus payments under the MICP will be governed by Section 6.2(c)(ii) and not
      this Section.

     

    (c) In
      addition, provided that Executive executes and does not revoke a Release as
      provided in Section 7 and complies with Section 6.7(b), the Company will pay
      or
      grant Executive, in lieu of any other severance benefits or any other
      compensation, the Severance Benefits set forth in Section 6.2(c).

     

    (d) The
      Company will have the right to withhold further payments of unpaid Severance
      Benefits upon its notice to Executive of the Board’s good faith reasonable
      belief, and the basis for the reasonable belief, that Executive has breached
      any
      of his post-termination obligations to the Company under applicable laws and
      as
      defined in this Agreement and the PIIA.

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

     

    6.4 Termination
      by Executive Without Good Reason.

     

    (a) Executive
      may terminate this Agreement at any time without Good Reason effective thirty
      (30) days after written notice to the Company or on such other termination
      date
      agreed with the Company. 

     

    (b) If
      Executive terminates this Agreement without Good Reason, the Company will pay
      Executive (i) the Base Salary due Executive through the date of termination,
      (ii) for any accrued PTO not taken at the time of the receipt of the notice
      of
      termination, and (iii) any other amounts to which Executive is entitled under
      any bonus or compensation plan or practice of the Company at the time of
      termination. Executive will not be entitled to receive any Severance
      Benefits.

     

    6.5 Termination
      for Death.

     

    (a) This
      Agreement will terminate immediately upon Executive’s death. 

     

    (b) Upon
      termination of this Agreement due to Executive’s death, the Company will pay to
      any beneficiaries designated by Executive in writing in Exhibit
      C,
      or in
      the absence of such designation, to Executive’s estate,
      (each a
“Death Benefits Recipient”) (i) the Base Salary due Executive through the date
      of termination, (ii) for any accrued PTO not taken by the Executive at the
      time
      of termination, and (iii) any other amounts to which Executive was entitled
      at
      the time of termination under any bonus or compensation plan or practice of
      the
      Company, provided,
      however, that
      any
      bonus payments under the MICP will be governed by Section 6.2(c)(ii) and not
      this Section;

     

    (c) In
      addition, the Company will pay the Death Benefits Recipient(s), in lieu of
      any
      other severance benefits or any other compensation, the Severance Benefits
      set
      forth in Section 6.2(c)(i) - (iv); provided
      that if
      the
      Company provides the Executive with life insurance coverage which is at least
      two (2) times the Executive’s Base Salary, then the payment of such life
      insurance to the beneficiaries designated in the insurance policy will replace
      the Company’s obligation to pay the Death Benefits Recipient(s) the Severance
      Benefits set forth in Section 6.2(c)(i) – (iii).

     

    (d) In
      addition, provided the Executive’s dependents are participating the Company’s
      health insurance plan at the time of his death, for the period beginning on
      the
      date of death and ending on the date which is twelve (12) full months following
      the date of death (or, if earlier, the date on which the applicable continuation
      period under COBRA or applicable state coverage continuation coverage laws
      expires), the Company will reimburse Executive’s eligible dependents (1) for the
      costs associated with continuation coverage for such eligible
      dependents
      pursuant
      to COBRA or any corresponding state law)
      (provided that Executive’s dependents will be solely responsible for all matters
      relating to such continuation of coverage pursuant to COBRA or any corresponding
      state law, including, without limitation, election of such coverage and the
      timely payment of premiums), or (2) if Executive’s dependents are participating
      the Company’s health insurance plans on the termination date and are not
      eligible for continuation coverage pursuant to either COBRA or any corresponding
      state law, for the premiums for conversion coverage if available, otherwise
      for
      the premiums of any health insurance with coverage comparable to that under
      the
      Company’s health insurance plans for Executive and his eligible dependents who
      were covered under the Company’s health insurance plans as of the date of the
      termination of this Agreement in either case up to a maximum of 2 times the
      premium paid by the Company on the Executive’s behalf under the Company’s plan ;
      and

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

    (e) Executive
      may change any beneficiary designated in Exhibit
      C
      by
      written notice to the Company.

     

    6.6 Termination
      for Disability.

     

    (a) The
      Company may terminate this Agreement for Executive’s Disability by written
      notice to Executive effective upon receipt or per a termination date agreed
      with
      Executive. “Disability”
will
      be
      deemed to have occurred if Executive was physically or mentally incapacitated
      or
      disabled or otherwise unable fully to discharge his duties hereunder for (i)
      a
      period in excess of ninety (90) consecutive days, or (ii) a period in excess
      of
      one hundred twenty (120) days in the aggregate in any consecutive one hundred
      eighty (180) day period. 
      This
      definition will be interpreted and applied consistent with the Americans with
      Disabilities Act, the Family and Medical Leave Act and other applicable law.
      The
      existence of Executive’s Disability will be determined by the Company on the
      advice of a physician chosen by the Company and either the Executive or, in
      the
      event of mental disability, Executive’s Death Benefits Recipients. The Company
      reserves the right to have Executive examined by such physician at the Company’s
      expense.

     

    (b) If
      the
      Company terminates this Agreement for Executive’s Disability, the Company will
      pay Executive (i) the Base Salary due Executive through the date of termination,
      (ii) for any accrued PTO not taken at the time of termination, and (iii) any
      other amounts to which Executive is entitled at the time of termination under
      any bonus or compensation plan or practice of the Company
      provided, however, that
      any
      bonus payments under the MICP will be governed by Section 6.2(c)(ii) and not
      this Section.

     

    (c) In
      addition, provided that Executive executes and does not revoke a Release as
      provided in Section 7 and complies with Section 6.7(b), the Company will pay
      or
      grant Executive, in lieu of any other severance benefits or any other
      compensation, the Severance Benefits set forth in Section 6.2(c) (i)-(iv),
      (vi)
      and (vii); provided
      that if
      the
      Company provides the Executive with long term disability insurance coverage
      at
      not less than 80% of his Base Salary with eligibility for coverage to the age
      of
      65, then the payment pursuant to such insurance will replace the Company’s
      obligation to pay the Severance Benefits set forth in Section 6.1(c)(i) – (iii).
      At Executive’s election he may pay the premium for this long term disability
      coverage.

     

    (d) The
      Company will have the right to withhold further payments of unpaid Severance
      Benefits upon its notice to Executive of the Board’s good faith reasonable
      belief, and the basis for the reasonable belief, that Executive has breached
      any
      of his post-termination obligations to the Company under applicable laws and
      as
      defined in this Agreement and the PIIA. 

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

     

    6.7 Cooperation
      Obligations.

     

    (a) Transition
      Activities.
      After
      delivery or receipt by Executive of any notice of termination, and for a
      reasonable period following any termination of this Agreement (to include any
      period for which Executive has been provided Base Salary as a severance
      benefit), Executive will fully cooperate with the Company in all matters
      relating to the winding up of Executive’s pending work and the orderly transfer
      of any such pending work to such other employees as may be designated by the
      Company. 

     

    (b) Return
      of the Company’s Property.
      If the
      Company has delivered or received a notice of termination of this Agreement,
      the
      Company will have the right, at its option, to require Executive to vacate
      his
      offices and to cease all activities on the Company’s behalf prior to the
      effective date of termination. Upon the termination of this Agreement, as a
      condition to Executive’s receipt of any post-termination benefits described in
      this Agreement, Executive will immediately surrender to the Company all lists,
      books and records of, or in connection with, the Company’s business, and all
      other tangible and intangible property belonging to the Company, it being
      distinctly understood that all such lists, books and records, and other
      property, are the property of the Company. Executive will deliver to the Company
      a signed statement certifying compliance with this Section 6.7 prior to the
      receipt of any post-termination benefits described in this
      Agreement

     

    (c) Litigation.
      After
      the termination of this Agreement, Executive will cooperate with the Company
      in
      responding to the reasonable requests of the Company’s Chairman of the Board,
      CEO or General Counsel, in connection with any and all existing or future
      litigation, arbitrations, mediations or investigations brought by or against
      the
      Company, or its or their respective affiliates, agents, officers, directors
      or
      employees, whether administrative, civil or criminal in nature, in which the
      Company reasonably deems Executive’s cooperation necessary or desirable. In such
      matters, Executive agrees to provide the Company with reasonable advice,
      assistance and information, including offering and explaining evidence,
      providing sworn statements, and participating in discovery and trial preparation
      and testimony. Executive also agrees to promptly send the Company copies of
      all
      correspondence (for example, but not limited to, subpoenas) received by
      Executive in connection with any such legal proceedings, unless Executive is
      expressly prohibited by law from so doing. 

     

    (d) Expenses
      and Fees. The
      Company will reimburse Executive for reasonable out-of-pocket expenses incurred
      by Executive as a result of his cooperation with the obligations described
      in
      this Section 6.7, within thirty (30) days of the presentation of appropriate
      documentation thereof, in accordance with the Company’s standard reimbursement
      policies and procedures. Except as provided in the preceding sentence, Executive
      will not be entitled to any compensation for activities performed pursuant
      to
      this Section 6.7 during the period for which Executive has been provided Base
      Salary as a severance benefit. Thereafter, the Company will pay Executive a
      compensation for activities performed pursuant to this Section 6.7 based on
      an
      hourly rate of 160th
      of
      Executive’s monthly Base Salary immediately preceding the termination of
      employment (the “Fees”).
      In
      performing obligations under this Section 6.7 following termination of this
      Agreement, Executive agrees and acknowledges that he will be serving as an
      independent contractor, not as a Company employee, and he will be entirely
      responsible for the payment of all income taxes and any other taxes due and
      owing as a result of the payment of Fees, will not be eligible to participate
      in
      any Company benefit plans while performing such services.

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

     

    
      	
              7.

            	
              Release

            

    

     

    As
      a
      condition precedent to receipt of any Severance Benefits, Executive will provide
      the Company with an executed and effective general release substantially in
      the
      form attached hereto as Exhibit B
      (the
“Release”),
      or a
      release in such other form as the parties may agree upon at the
      time.

     

    
      	
              8.

            	
              Non-Competition

            

    

     

    Executive
      will not, for a period of twelve (12) months from the termination of this
      Agreement, for Executive’s own account, or as owner, manager, officer,
      shareholder, consultant, director, representative or employee of a company,
      participate in the research or development of (i) antibodies against the EpCAM
      target molecule, or (ii) BiTE antibodies or active agents which trigger the
      same
      mechanism as BiTE antibodies (collectively, the “Non-Compete
      Field”).
      The
      Board may, in its discretion, reduce the scope of the Non-Compete
      Field.

     

    
      	
              9.

            	
              Non-Solicitation

            

    

     

    While
      employed by the Company, and for a period of six (6) months from the termination
      of this Agreement, Executive will not interfere with the business of the Company
      by (a) soliciting, attempting to solicit, inducing, or otherwise causing any
      employee of the Company to terminate employment in order to become an employee,
      consultant or independent contractor to or for any other person or entity;
      or
      (b) directly or indirectly causing any third party that provides services to
      the
      Company to terminate, diminish, or materially alter in a manner harmful to
      the
      Company its relationship with the Company.

     

    
      	
              10.

            	
              General
                Provisions

            

    

     

    10.1 Notices.
      Any
      notices provided hereunder must be in writing and will be deemed effective
      upon
      the earlier of personal delivery or receipt if delivered by mail or courier
      service, to the Company at its primary office location and to Executive at
      his
      address as listed on the Company payroll or Executive’s then current place of
      abode.

     

    10.2 Confidentiality.
      Unless
      publicly disclosed by the Company, Executive will hold the provisions of this
      Agreement in strictest confidence and will not publicize or disclose this
      Agreement in any manner whatsoever; provided,
      however,
      that Executive may disclose this Agreement: (a)
      to
      Executive’s immediate family;
      (b)
      in
      confidence to his attorneys, accountants, auditors, tax preparers, and financial
      advisors;
      (c) insofar
      as such disclosure may be necessary to enforce its terms or as otherwise
      permitted or required by law. In particular, and without limitation, Executive
      agrees not to disclose the terms of this Agreement to any current or former
      employee of the Company.

     

    10.3 Reasonableness
      of Restrictions.
      Executive acknowledges and agrees that (a) he has read this Agreement in its
      entirety and understands it, (b) the limitations imposed in this Agreement
      do
      not prevent him from earning a living or pursuing his career following the
      termination of this Agreement, and (c) the restrictions contained in this
      Agreement are reasonable, proper, and necessitated by the Company’s legitimate
      business interests. Executive represents and agrees that he is entering into
      this Agreement freely and with knowledge of its contents with the intent to
      be
      bound by the Agreement and the restrictions contained in it.

     

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

     

    10.4 Arbitration
      and Remedies. The
      parties recognize that litigation in federal or state courts or before federal
      or state administrative agencies of disputes arising out of Executive’s
      employment with the Company or out of this Agreement, or Executive’s termination
      of employment or termination of this Agreement, may not be in the best interests
      of either Executive or the Company, and may result in unnecessary costs, delays,
      complexities, and uncertainty. The parties agree that any dispute between the
      parties arising out of or relating to the negotiation, execution, performance
      or
      termination of this Agreement or Executive’s employment, including, but not
      limited to, any claim arising out of this Agreement, claims under Title VII
      of
      the Civil Rights Act of 1964, as amended, the Civil Rights Act of 1991, the
      Age
      Discrimination in Employment Act of 1967, the Americans with Disabilities Act
      of
      1990, Section 1981 of the Civil Rights Act of 1966, as amended, the Family
      Medical Leave Act, Executive Retirement Income Security Act, and any similar
      federal, state or local law, statute, regulation, or any common law doctrine,
      whether that dispute arises during or after employment, but excluding claims
      under or relating to Section 4.3, 6.7(b), 8 or 9 of this Agreement or relating
      to any separate agreements between the parties (including the Proprietary
      Information and Inventions Agreement) which do not specify arbitration as the
      exclusive remedy and which may be pursued in any court of applicable
      jurisdiction (such claims, the “Excluded
      Claims”),
      will
      be settled by binding arbitration in accordance with the National Rules for
      the
      Resolution of Employment Disputes of the American Arbitration Association by
      a
      single arbitrator selected in accordance with said rules; provided
      however, that
      as
      it may be impossible to assess the damages caused by violation of this Agreement
      or any of its terms, the parties agree upon the threatened or actual violation
      of this Agreement or any of its terms the aggrieved party will have the right
      to
      obtain injunctive relief from a court, without bond and without prejudice to
      any
      other rights and remedies for a breach or threatened breach of this
      Agreement. The
      location for the arbitration will be the Washington, D.C. metropolitan area.
      Any
      award made by such panel will be final, binding and conclusive on the parties
      for all purposes, and judgment upon the award rendered by the arbitrators may
      be
      entered in any court having jurisdiction thereof. The arbitrators’ fees and
      expenses and all administrative fees and expenses associated with the filing
      of
      the arbitration will be borne by the Company; provided however,
      that at
      Executive’s option, Executive may voluntarily pay up to one-half the costs and
      fees. The parties acknowledge and agree that their obligations to arbitrate
      under this Section survive the termination of this Agreement and continue after
      the termination of the employment relationship between Executive and the
      Company. The parties each further agree that the arbitration provisions of
      this
      Agreement will provide each party with its exclusive
      remedy,
      and
      each party expressly waives any right it might have to seek redress in any
      other
      forum, except as otherwise expressly provided in this Agreement. By election
      arbitration as the means for final settlement of all claims (other than the
      Excluded Claims), the
      parties hereby waive their respective rights to, and agree not to, sue each
      other in any action in a Federal, State or local court with respect to such
      claims, but may seek to enforce in court an arbitration award rendered pursuant
      to this Agreement. The parties specifically agree to waive their respective
      rights to a trial by jury, and further agree that no demand, request or motion
      will be made for trial by jury.

     

    
      
         

      

      
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    10.5 Surviving
      Clauses.
      Sections
      2.6(c), 3,
      5,
5,
      6,
      7,
      8
      and
9
      (including the definitions of any defined terms referenced therein) will survive
      any termination or expiration of this Agreement.

     

    10.6 Severability.
      In the
      event that a court finds this Agreement, or any of its restrictions, to be
      ambiguous, unenforceable, or invalid, the parties agree that the court will
      read
      the Agreement as a whole and interpret the restriction(s) at issue to be
      enforceable and valid to the maximum extent allowed by law. If the court
      declines to enforce this Agreement in the manner provided in this Section 10.6,
      Executive and the Company agree that this Agreement will be automatically
      modified to provide the Company with the maximum protection of its business
      interests allowed by law and Executive agrees to be bound by this Agreement
      as
      modified. In case any one or more of the provisions, subsections, or sentences
      contained in this Agreement will, for any reason, be held to be invalid, illegal
      or unenforceable in any respect, such invalidity, illegality or unenforceability
      will not affect the other provisions of this Agreement, and this Agreement
      will
      be construed as if such invalid, illegal or unenforceable provision had never
      been contained herein.

     

    10.7 Waiver.
      If
      either party should waive any breach of any provisions of this Agreement or
      fail
      to enforce performance by the other party, he or it will not thereby be deemed
      to have waived any preceding or succeeding breach or performance of the same
      or
      any other provision of this Agreement. Any such waiver will be effective only
      if
      made in writing and signed by the Party waiving such breach or
      performance.

     

    10.8 Complete
      Agreement; Amendment.
      This
      Agreement and its Exhibits, constitute the entire agreement between Executive
      and the Company and it is the complete, final, and exclusive embodiment of
      their
      agreement with regard to this subject matter. This Agreement replaces all
      previous agreements regarding the service relationship of Executive with the
      Company. It is entered into without reliance on any promise or representation
      other than those expressly contained herein. This Agreement cannot be modified
      or amended except in a writing signed by an authorized representative of the
      Company and Executive.

     

    10.9 Counterparts.
      This
      Agreement may be executed in separate counterparts, any one of which need not
      contain signatures of more than one party, but all of which taken together
      will
      constitute one and the same Agreement.

     

    10.10 Assignment;
      Assumption by Successor; Non-transferability of Interest.

     

    (a) The
      Company may assign this Agreement, without the consent of Executive, to any
      business entity which at any time, whether by purchase, merger or otherwise,
      directly or indirectly, acquires all or substantially all of the assets or
      business of the Company. The Company will require any successor (whether direct
      or indirect, by purchase, merger or otherwise) to all or substantially all
      of
      the business or assets of the Company expressly to assume and to agree to
      perform this Agreement in the same manner and to the same extent that the
      Company would be required to perform it if no such succession had taken place;
      provided,
      however,
      that no
      such assumption will relieve the Company of its obligations hereunder. As used
      in this Agreement, the “Company” will mean the Company as hereinbefore defined
      and any successor to its business and/or assets as aforesaid which assumes
      and
      agrees to perform this Agreement by operation of law or otherwise. 

     

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

     

    (b) None
      of
      the rights of Executive to receive any form of compensation payable pursuant
      to
      this Agreement will be assignable or transferable except through a testamentary
      disposition or by the laws of descent and distribution upon the death of
      Executive. Any attempted assignment, transfer, conveyance, or other disposition
      (other than as aforesaid) of any interest in the rights of Executive to receive
      any form of compensation to be made by the Company pursuant to this Agreement
      will be void.

     

    10.11 Headings.
      The
      headings of the sections hereof are inserted for convenience only and will
      not
      be deemed to constitute a part hereof nor to affect the meaning thereof.

     

    10.12 Construction.
      The
      language in all parts of this Agreement will in all cases be construed simply,
      according to its fair meaning, and not strictly for or against any of the
      parties hereto. Without limitation, there will be no presumption against any
      party on the ground that such party was responsible for drafting this Agreement
      or any part thereof.

     

    10.13 Choice
      of Law.
      All
      questions concerning the construction, validity, interpretation of this
      Agreement will be governed by the laws of the State of Maryland as applicable
      to
      contracts made and wholly performed within the State of Maryland by residents
      of
      that State.

     

    In
      Witness Whereof,
      the
      parties have executed this Agreement on the day and year first above
      written.

     

    Micromet,
      Inc.

    

      
        	
                /s/
                  Christian Itin

              	 
	
                Name:
                  Christian Itin

              	 
	
                Title:
                  President and CEO

              	 
	 	 
	
                /s/
                  Barclay Phillips

              	 
	
                Barclay
                  Phillips

              	 

      

    

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

       

    

    Exhibit
      A

     

    Micromet,
      Inc.

     

    EMPLOYEE
      PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT

    

    In
      consideration of my employment or continued employment by Micromet,
      Inc.,
      its
      subsidiaries, parents, affiliates, successors and assigns (together, the
“Company”)
      and
      the compensation now and hereafter paid to me, I hereby enter into this
      Proprietary Information and Inventions Agreement (the “Agreement”)
      and
      agree as follows:

    

    1. Nondisclosure.

     

    1.1 Recognition
      of the Company's Rights; Nondisclosure.
      I
      understand and acknowledge that my employment by the Company creates a
      relationship of confidence and trust with respect to the Company’s Proprietary
      Information (defined below) and that the Company has a protectable interest
      therein. At all times during my employment and thereafter, I will hold in
      strictest confidence and will not disclose, use, lecture upon or publish any
      of
      the Company's Proprietary Information, except as such disclosure, use or
      publication may be required in connection with my work for the Company, or
      unless an officer of the Company expressly authorizes such in writing. I will
      obtain the Company's written approval before publishing or submitting for
      publication any material (written, verbal, or otherwise) that relates to my
      work
      at the Company and/or incorporates any Proprietary Information. I hereby assign
      to the Company any rights I may have or acquire in such Proprietary Information
      and recognize that all Proprietary Information will be the sole property of
      the
      Company and its assigns. I will take all reasonable precautions to prevent
      the
      inadvertent or accidental disclosure of Proprietary Information.

     

    1.2  Proprietary
      Information. The
      term
“Proprietary
      Information”
will
      mean any and all confidential and/or proprietary knowledge, data or information
      of the Company, its affiliates, parents and subsidiaries, whether having
      existed, now existing, or to be developed during my employment. By way of
      illustration but not limitation, “Proprietary
      Information”
      includes (a)  the identity, structure, chemical formula and composition of
      any materials in research or development by the Company; procedures and
      formulations for producing or manufacturing any such materials; all information
      relating to preclinical and clinical studies and the results thereof; regulatory
      documentation and/or submissions and information relating to the regulatory
      status of any such materials; any data, reports, analyses, techniques,
      processes, technical information, ideas, know-how, trade secrets, patents,
      patent applications or inventions and any other proprietary technology and
      all
      Proprietary Rights therein (hereinafter collectively referred to as
“Inventions”);
      (b) information regarding research, development, ongoing or potential
      projects, grants, grant proposals, new products, marketing and selling, business
      plans, budgets and unpublished financial statements, licenses, prices and costs,
      margins, discounts, credit terms, pricing and billing policies, quoting
      procedures, methods of obtaining business, forecasts, future plans and potential
      strategies, financial projections and business strategies, operational plans,
      financing and capital-raising plans, activities and agreements, internal
      services and operational manuals, methods of conducting Company business,
      suppliers and supplier information, and purchasing; (c) information regarding
      customers and potential customers of the Company, including customer lists,
      names, representatives, their needs or desires with respect to the types of
      products or services offered by the Company, proposals, bids, contracts and
      their contents and parties, the type and quantity of products and services
      provided or sought to be provided to customers and potential customers of the
      Company and other non-public information relating to customers and potential
      customers; (d) information regarding any of the Company’s business partners and
      their services, including names; representatives, proposals, bids, contracts
      and
      their contents and parties, the type and quantity of products and services
      received by the Company, and other non-public information relating to business
      partners; (e) information regarding personnel, employee lists, compensation,
      and
      employee skills; and (f) any other non-public information which a competitor
      of
      the Company could use to the competitive disadvantage of the Company.
      Notwithstanding the foregoing, it is understood that, at all such times, I
      am
      free to use information which is generally known in the trade or industry
      through no breach of this agreement or other act or omission by me, and I am
      free to discuss the terms and conditions of my employment with others to the
      extent permitted by law.

     

    
      
         

      

      
        A-1.

        
          

        

      

      
         

      

    

     

    1.3 Third
      Party Information.
      I
      understand, in addition, that the Company has received and in the future will
      receive from third parties their confidential and/or proprietary knowledge,
      data, or information (“Third
      Party Information”).
      During my employment and thereafter, I will hold Third Party Information in
      the
      strictest confidence and will not disclose to anyone (other than the Company
      personnel who need to know such information in connection with their work for
      the Company) or use, except in connection with my work for the Company, Third
      Party Information unless expressly authorized by an officer of the Company
      in
      writing.

     

    1.4 Term
      of Nondisclosure Restrictions.
      I
      understand that Proprietary Information and Third Party Information is never
      to
      be used or disclosed by me, as provided in this Section 1. If, however, a court
      decides that this Section 1 or any of its provisions is unenforceable for lack
      of reasonable temporal limitation and the Agreement or its restriction(s) cannot
      otherwise be enforced, I agree and the Company agrees that the two (2) year
      period after the date my employment ends will be the temporal limitation
      relevant to the contested restriction, provided, however, that this sentence
      will not apply to trade secrets protected without temporal limitation under
      applicable law.

     

    1.5 No
      Improper Use of Information of Prior Employers and Others.
      During
      my employment by the Company I will not improperly use or disclose any
      confidential information or trade secrets, if any, of any former employer or
      any
      other person to whom I have an obligation of confidentiality, and I will not
      bring onto the premises of the Company any unpublished documents or any property
      belonging to any former employer or any other person to whom I have an
      obligation of confidentiality unless consented to in writing by that former
      employer or person. 

     

    2. Assignment
      of Inventions.

     

    2.1 Proprietary
      Rights.
      The term
“Proprietary
      Rights”
will
      mean all trade secrets, patents, copyrights, trade marks, mask works and other
      intellectual property rights throughout the world. 

     

    2.2 Prior
      Inventions.
      Inventions, if any, patented or unpatented, which I made prior to the
      commencement of my employment with the Company are excluded from the scope
      of
      this Agreement. To preclude any possible uncertainty, I have set forth on
Exhibit A
      (Previous
      Inventions) attached hereto a complete list of all Inventions that I have,
      alone
      or jointly with others, conceived, developed or reduced to practice or caused
      to
      be conceived, developed or reduced to practice prior to the commencement of
      my
      employment with the Company, that I consider to be my property or the property
      of third parties, and that I wish to have excluded from the scope of this
      Agreement (collectively referred to as “Prior
      Inventions”).
      If
      disclosure of any such Prior Invention would cause me to violate any prior
      confidentiality agreement, I understand that I am not to list such Prior
      Inventions in Exhibit A
      but am
      only to disclose a cursory name for each such invention, a listing of the
      party(ies) to whom it belongs and the fact that full disclosure as to such
      inventions has not been made for that reason. A space is provided on
Exhibit
      A
      for such
      purpose. If no such disclosure is attached, I represent that there are no Prior
      Inventions. If, in the course of my employment with the Company, I incorporate
      a
      Prior Invention into a Company product, process or machine, the Company is
      hereby granted and will have a nonexclusive, royalty-free, irrevocable,
      perpetual, fully-paid, worldwide license (with rights to sublicense through
      multiple tiers of sublicensees) to make, have made, modify, make derivative
      works of, publicly perform, publicly perform, use, sell, import, and exercise
      any and all present and future rights in such Prior Invention. Notwithstanding
      the foregoing, I agree that I will not incorporate, or permit to be
      incorporated, Prior Inventions in any Company Inventions without the Company's
      prior written consent.

     

    2.3 Assignment
      of Inventions.
      Subject
      to Subsections 2.4 and 2.6, I hereby assign and agree to assign in the future
      (when any such Inventions or Proprietary Rights are first reduced to practice
      or
      first fixed in a tangible medium, as applicable) to the Company all my right,
      title and interest in and to any and all Inventions (and all Proprietary Rights
      with respect thereto) whether or not patentable or registrable under copyright
      or similar statutes, made or conceived or reduced to practice or learned by
      me,
      either alone or jointly with others, during the period of my employment with
      the
      Company. Inventions assigned to the Company, or to a third party as directed
      by
      the Company pursuant to this Section 2, are hereinafter referred to as
“Company
      Inventions.”
      

     

    2.4 Unassigned
      or Nonassignable Inventions.
      I
      recognize that this Agreement will not be deemed to require assignment of any
      Invention that I developed entirely on my own time without using the Company’s
      equipment, supplies, facilities, trade secrets, or Proprietary Information,
      except for those Inventions that either (i) relate to the Company’s actual or
      anticipated business, research or development, or (ii) result from or are
      connected with work performed by me for the Company. In addition, this Agreement
      does not apply to any Invention which qualifies fully for protection from
      assignment to the Company under any specifically applicable state law,
      regulation, rule, or public policy (“Specific
      Inventions Law”).

     

    
      
         

      

      
        A-2.

        
          

        

      

      
         

      

    

     

    2.5 Obligation
      to Keep Company Informed.
      During
      the period of my employment and for six (6) months after termination of my
      employment with the Company, I will promptly disclose to the Company fully
      and
      in writing all Inventions authored, conceived or reduced to practice by me,
      either alone or jointly with others. In addition, I will promptly disclose
      to
      the Company all patent applications filed by me or on my behalf within a year
      after termination of employment. At the time of each such disclosure, I will
      advise the Company in writing of any Inventions that I believe fully qualify
      for
      protection under the provisions of a Specific Inventions Law; and I will at
      that
      time provide to the Company in writing all evidence necessary to substantiate
      that belief. The Company will keep in confidence and will not use for any
      purpose or disclose to third parties without my consent any confidential
      information disclosed in writing to the Company pursuant to this Agreement
      relating to Inventions that qualify fully for protection under a Specific
      Inventions Law. I will preserve the confidentiality of any Invention that does
      not fully qualify for protection under a Specific Inventions Law.

     

    2.6 Government
      or Third Party.
      I also
      agree to assign all my right, title and interest in and to any particular the
      Company Invention to a third party, including without limitation the United
      States, as directed by the Company.

     

    2.7 Works
      for Hire.
      I
      acknowledge that all original works of authorship which are made by me (solely
      or jointly with others) within the scope of my employment and which are
      protectable by copyright are “works made for hire,” pursuant to United States
      Copyright Act (17 U.S.C., Section 101).

     

    2.8 Enforcement
      of Proprietary Rights.
      I will
      assist the Company in every proper way to obtain, and from time to time enforce,
      United States and foreign Proprietary Rights relating to the Company Inventions
      in any and all countries. To that end I will execute, verify and deliver such
      documents and perform such other acts (including appearances as a witness)
      as
      the Company may reasonably request for use in applying for, obtaining,
      perfecting, evidencing, sustaining and enforcing such Proprietary Rights and
      the
      assignment thereof. In addition, I will execute, verify and deliver assignments
      of such Proprietary Rights to the Company or its designee. My obligation to
      assist the Company with respect to Proprietary Rights relating to such the
      Company Inventions in any and all countries will continue beyond the termination
      of my employment, but the Company will compensate me at a reasonable rate after
      my termination for the time actually spent by me at the Company's request on
      such assistance.

     

    In
      the
      event the Company is unable for any reason, after reasonable effort, to secure
      my signature on any document needed in connection with the actions specified
      in
      the preceding paragraph, I hereby irrevocably designate and appoint the Company
      and its duly authorized officers and agents as my agent and attorney in fact,
      which appointment is coupled with an interest, to act for and in my behalf
      to
      execute, verify and file any such documents and to do all other lawfully
      permitted acts to further the purposes of the preceding paragraph with the
      same
      legal force and effect as if executed by me. I hereby waive and quitclaim to
      the
      Company any and all claims, of any nature whatsoever, which I now or may
      hereafter have for infringement of any Proprietary Rights assigned hereunder
      to
      the Company.

     

    3. Records. I
      agree
      to keep and maintain adequate and current records (in the form of notes,
      sketches, drawings and in any other form that may be required by the Company)
      of
      all Proprietary Information developed by me and all Inventions made by me during
      the period of my employment at the Company, which records will be available
      to
      and remain the sole property of the Company at all times.

     

    4. Duty
      Of Loyalty During Employment. I
      agree
      that during the period of my employment by the Company I will not, without
      the
      Company's express written consent, directly or indirectly engage in any
      employment or business activity which is directly or indirectly competitive
      with, or would otherwise conflict with, my employment by the
      Company.

     

    5. Reasonableness
      Of Restrictions.

     

    5.1 I
      agree
      that I have read this entire Agreement and understand it. I agree that this
      Agreement does not prevent me from earning a living or pursuing my career.
      I
      agree that the restrictions contained in this Agreement are reasonable, proper,
      and necessitated by the Company’s legitimate business interests. I represent and
      agree that I am entering into this Agreement freely and with knowledge of its
      contents with the intent to be bound by the Agreement and the restrictions
      contained in it.

     

    
      
         

      

      
        A-3.

        
          

        

      

      
         

      

    

     

    5.2 In
      the
      event that a court finds this Agreement, or any of its restrictions, to be
      ambiguous, unenforceable, or invalid, I and the Company agree that the court
      will read the Agreement as a whole and interpret the restriction(s) at issue
      to
      be enforceable and valid to the maximum extent allowed by law.

     

    5.3 If
      the
      court declines to enforce this Agreement in the manner provided in subsection
      5.2,
      I and
      the Company agree that this Agreement will be automatically modified to provide
      the Company with the maximum protection of its business interests allowed by
      law
      and I agree to be bound by this Agreement as modified.

     

    6. No
      Conflicting Agreement or Obligation.
      I
      represent that my performance of all the terms of this Agreement and as an
      employee of the Company does not and will not breach any agreement to keep
      in
      confidence information acquired by me in confidence or in trust prior to my
      employment by the Company. I have not entered into, and I agree I will not
      enter
      into, any agreement either written or oral in conflict herewith.

     

    7. Return
      of the Company Property.
      When I
      leave the employ of the Company, I will deliver to the Company any and all
      drawings, notes, memoranda, specifications, devices, formulas, and documents,
      together with all copies thereof, and any other material containing or
      disclosing any Company Inventions, Third Party Information or Proprietary
      Information of the Company. I further agree that any property situated on the
      Company's premises and owned by the Company, including disks and other storage
      media, filing cabinets or other work areas, is subject to inspection by the
      Company personnel at any time with or without notice. Prior to leaving, I will
      cooperate with the Company in completing and signing the Company's termination
      statement if requested to do so by the Company.

     

    8. Notices.
      Any
      notices required or permitted hereunder will be given to the appropriate party
      at the address specified below or at such other address as the party will
      specify in writing. Such notice will be deemed given upon personal delivery
      to
      the appropriate address or if sent by certified or registered mail, three (3)
      days after the date of mailing.

     

    9. Notification
      of New Employer.
      In the
      event that I leave the employ of the Company, I hereby consent to the
      notification of my new employer of my rights and obligations under this
      Agreement.

     

    10. General
      Provisions

     

    10.1 Governing
      Law.
      All
      questions concerning the construction, validity, interpretation of this
      Agreement will be governed by and construed according to the laws of the State
      of Maryland as applicable to contracts made and wholly performed within the
      State of Maryland by residents of the State of Maryland.
      I hereby
      expressly consent to the personal jurisdiction and venue of the state and
      federal courts located in Montgomery County, Maryland for any lawsuit filed
      there against me by Company arising from or related to this Agreement.

     

    10.2 Severability.
      In case
      any one or more of the provisions, subsections, or sentences contained in this
      Agreement will, for any reason, be held to be invalid, illegal or unenforceable
      in any respect, such invalidity, illegality or unenforceability will not affect
      the other provisions of this Agreement, and this Agreement will be construed
      as
      if such invalid, illegal or unenforceable provision had never been contained
      herein. If moreover, any one or more of the provisions contained in this
      Agreement will for any reason be held to be excessively broad as to duration,
      geographical scope, activity or subject, it will be construed by limiting and
      reducing it, so as to be enforceable to the extent compatible with the
      applicable law as it will then appear.

     

    10.3 Successors
      and Assigns.
      This
      Agreement is for my benefit and the benefit of the Company, its successors,
      assigns, parent corporations, subsidiaries, affiliates, and purchasers, and
      will
      be binding upon my heirs, executors, administrators and other legal
      representatives. 

     

    10.4 Survival.
      The
      provisions of this Agreement will survive the termination of my employment,
      regardless of the reason, and the assignment of this Agreement by the Company
      to
      any successor in interest or other assignee.

     

    10.5 Employment
      Status.
      I agree
      and understand that nothing in this Agreement will change my employment status
      or confer any right with respect to continuation of employment by the Company,
      nor will it interfere in any way with my right or the Company's right to
      terminate my employment at any time, with or without cause or advance
      notice.

     

    
      
         

      

      
        A-4.

        
          

        

      

      
         

      

    

     

    10.6 Waiver.
      No
      waiver by the Company of any breach of this Agreement will be a waiver of any
      preceding or succeeding breach. No waiver by the Company of any right under
      this
      Agreement will be construed as a waiver of any other right. The Company will
      not
      be required to give notice to enforce strict adherence to all terms of this
      Agreement.

     

    10.7 Advice
      of Counsel. I ACKNOWLEDGE THAT, IN EXECUTING THIS AGREEMENT, I HAVE HAD THE
      OPPORTUNITY TO SEEK THE ADVICE OF INDEPENDENT LEGAL COUNSEL, AND I HAVE READ
      AND
      UNDERSTOOD ALL OF THE TERMS AND PROVISIONS OF THIS AGREEMENT. THIS AGREEMENT
      WILL NOT BE CONSTRUED AGAINST ANY PARTY BY REASON OF THE DRAFTING OR PREPARATION
      HEREOF.

     

    10.8 Entire
      Agreement.
      The
      obligations pursuant to Sections 1 and 2 (except Subsection 2.7) of this
      Agreement will apply to any time during which I was previously engaged, or
      am in
      the future engaged, by the Company as a consultant if no other agreement governs
      nondisclosure and assignment of inventions during such period. This Agreement
      is
      the final, complete and exclusive agreement of the parties with respect to
      the
      subject matter hereof and supersedes and merges all prior discussions between
      us. No modification of or amendment to this Agreement, nor any waiver of any
      rights under this Agreement, will be effective unless in writing and signed
      by
      the party to be charged. Any subsequent change or changes in my duties, salary
      or compensation will not affect the validity or scope of this Agreement.

     

    I
      have read this agreement carefully and understand its terms. I have completely
      filled out Exhibit A to this Agreement.

    

      
        	
                Dated:
                  August 30, 2008

              	 
	 	 
	
                /s/
                  Barclay Phillips

              	 
	
                Name:
                  Barclay Phillips

              	 
	 	 
	
                Accepted
                  and Agreed To:

              	 
	 	 
	
                Micromet,
                  inc.

              	 
	 	 
	
                By: 

              	/s/
                Christian Itin	 
	
                Name:
                  Christian Itin

              	 
	
                Title:
                  President & CEO

              	 

      

    

     

    
      
         

      

      
        A-5.

        
          

        

      

      
         

      

    

     

    Exhibit
      A

     

    Previous
      Inventions

    

      
        	
                TO:

              	
                Micromet,
                  Inc.

              	 
	 	 	 
	
                FROM:

              	 	 
	 	 	 
	
                DATE:

              	 	 

      

    

     

    SUBJECT: Previous
      Inventions 

     

    1. Except
      as
      listed in Section 2 below, the following is a complete list of all inventions
      or
      improvements relevant to the subject matter of my employment by [Company]
      (the
“Company”)
      that
      have been made or conceived or first reduced to practice by me alone or jointly
      with others prior to my engagement by the Company:

    

      
        	
                 ̈

              	
                No
                  inventions or improvements.

              
	 	 
	
                 ̈

              	
                See
                  below:

              
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 

      

       

    

    
      	
               ̈

            	
              Additional
                sheets attached.

            

    

     

    2. Due
      to a
      prior confidentiality agreement, I cannot complete the disclosure under
      Section 1 above with respect to inventions or improvements generally listed
      below, the proprietary rights and duty of confidentiality with respect to which
      I owe to the following party(ies):

    

      
        	 	 	
                Invention
                  or Improvement

              	 	
                Party(ies)

              	 	
                Relationship

              
	 	 	 	 	 	 	 
	
                1.

              	 	 	 	 	 	 
	 	 	 	 	 	 	 
	
                2.

              	 	 	 	 	 	 
	 	 	 	 	 	 	 
	
                3.

              	
                  

              	 	
                  

              	 	
                  

              	 

      

    

     

    
      
        	 ̈	
                Additional
                  sheets attached.

              

      

    

     

    
      
         

      

      
        A-6.

        
          

        

      

      
         

      

    

     

    Exhibit
      B

     

    RELEASE
      AGREEMENT

    

    This
      Release of Claims (Release”)
      is made
      as of _________________ by and between Barclay
      Phillips (“Executive”)
      and
      Micromet, Inc. (the “Company”)
      (together, the “Parties”).

    

    1. In
      consideration for Executive’s execution of this Release, the Company will
      provide the following Severance Benefits: [itemize
      benefits].

     

    2. Executive
      hereby releases, acquits and forever discharges the Company, its parents and
      subsidiaries, and their officers, directors, agents, servants, employees,
      stockholders, successors, assigns and affiliates, of and from any and all
      claims, liabilities, demands, causes of action, costs, expenses, attorneys
      fees,
      damages, indemnities and obligations of every kind and nature, in law, equity,
      or otherwise, which were known or through reasonable diligence should have
      been
      known, arising out of or in any way related to Releases, events, acts or conduct
      at any time prior to the date Executive executes this Settlement Release,
      including, but not limited to: all such claims and demands directly or
      indirectly arising out of or in any way connected with Executive’s employment
      with the Company, including but not limited to, claims of intentional and
      negligent infliction of emotional distress, any and all tort claims for personal
      injury, claims or demands related to salary, bonuses, commissions, stock, stock
      options, or any other ownership interests in the Company, PTO pay, fringe
      benefits, expense reimbursements, severance pay, or any other form of
      compensation; claims pursuant to any federal, state or local law or cause of
      action including, but not limited to, any and all claims and causes of action
      that the Company, its parents and subsidiaries, and its and their respective
      officers, directors, agents, servants, employees, attorneys, shareholders,
      successors, assigns or affiliates:

     

    
      	 	
              ·

            	
              has
                violated its personnel policies, handbooks, contracts of employment,
                or
                covenants of good faith and fair
                dealing;

            

    

     

    
      	 	
              ·

            	
              has
                discriminated against him on the basis of age, race, color, sex (including
                sexual harassment), national origin, ancestry, disability, religion,
                sexual orientation, marital status, parental status, source of income,
                entitlement to benefits, any union activities or other protected
                category
                in violation of any local, state or federal law, constitution, ordinance,
                or regulation, including but not limited to: Title VII of the Civil
                Rights
                Act of 1964, as amended; 42 U.S.C. § 1981, as amended; the Equal Pay
                Act; the Americans With Disabilities Act; the Family and Medical
                Leave
                Act; the Employee Retirement Income Security Act; Section 510; and
                the
                National Labor Relations Act;

            

    

     

    
      	 	
              ·

            	
              has
                violated any statute, public policy or common law (including but
                not
                limited to claims for retaliatory discharge; negligent hiring, retention
                or supervision; defamation; intentional or negligent infliction of
                emotional distress and/or mental anguish; intentional interference
                with
                contract; negligence; detrimental reliance; loss of consortium to
                him or
                any member of his/her family and/or promissory
                estoppel).

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Excluded
      from this Release are any claims which cannot be waived by law. Executive is
      waiving, however, his/her right to any monetary recovery should any governmental
      agency or entity, such as the EEOC or the DOL, pursue any claims on his/her
      behalf. Executive acknowledges that he is knowingly and voluntarily waiving
      and
      releasing any rights he may have under the ADEA, as amended. Executive also
      acknowledges that (i) the consideration given to his/her in exchange for the
      waiver and release in this Release is in addition to anything of value to which
      he was already entitled, and (ii) that he/she has been paid for all time worked,
      have received all the leave, leaves of absence and leave benefits and
      protections for which he/she is eligible, and have not suffered any on-the-job
      injury for which he/she has not already filed a claim. Executive further
      acknowledges that he has been advised by this writing that: (a) his waiver
      and
      release do not apply to any rights or claims that may arise after the execution
      date of this Release; (b) he has been advised hereby that he/she has the right
      to consult with an attorney prior to executing this Release; (c) he has
      twenty-one (21) days to consider this Release (although Executive may choose
      to
      voluntarily execute this Release earlier and if he/she does he/she will sign
      the
      Consideration Period waiver below); (d) he has seven (7) days following his
      execution of this Release to revoke the Release; and (e) this Release will
      not
      be effective until the date upon which the revocation period has expired
      unexercised, which will be the eighth day after Executive executes this
      Release.

     

    3. On
      or
      before the last day of Executive’s employment, Executive agrees to return to the
      Company all Company documents (and all copies thereof) and other Company
      property that Executive has had in his/her possession at any time, including,
      but not limited to, Company files, notes, drawings, records, business plans
      and
      forecasts, financial information, specifications, computer-recorded information,
      tangible property (including, but not limited to, computers), credit cards,
      entry cards, identification badges and keys; and, any materials of any kind
      that
      contain or embody any proprietary or confidential information of the Company
      (and all reproductions thereof). Executive will coordinate the return of Company
      property with [name/title].
      

     

    4. Executive
      further agrees that both during and after Executive’s employment Executive
      acknowledges his/her continuing obligations under his/her Proprietary
      Information, Inventions and Non-Competition Agreement not to use or disclose
      any
      confidential or proprietary information of the Company and to refrain from
      certain solicitation and competitive activities. 

     

    5. It
      is
      understood that Executive will hold the provisions of this Release in strictest
      confidence and will not publicize or disclose it in any manner whatsoever;
      provided,
      however,
      that:
      (a) Executive may disclose this Release to his immediate family; (b) Executive
      may disclose this Release in confidence to his/her attorney, accountant,
      auditor, tax preparer, and financial advisor; and (c) Executive may disclose
      this Release insofar as such disclosure may be required by law.

     

    6. Executive
      agrees not to disparage the Company, and the Company’s attorneys, directors,
      managers, partners, employees, agents and affiliates, in any manner likely
      to be
      harmful to them or their business, business reputation or personal reputation;
      provided that Executive may respond accurately and fully to any question,
      inquiry or request for information when required by legal process. 

     

    7. This
      Release does not constitute an admission by the Company of any wrongful action
      or violation of any federal, state, or local statute, or common law rights,
      including those relating to the provisions of any law or statute concerning
      employment actions, or of any other possible or claimed violation of law or
      rights.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    8. Executive
      agrees that upon any breach of this Release Executive will forfeit all benefits
      paid or owing to Executive by virtue of his execution of this Release. Executive
      further acknowledges that it may be impossible to assess the damages caused
      by
      violation of the terms of paragraphs 3, 4, 5 and 6 of this Release and further
      agree that any threatened or actual violation or breach of those paragraphs
      of
      this Release will constitute immediate and irreparable injury to the Company.
      Executive therefore agrees that any such breach of this Release is a material
      breach of this Release, and, in addition to any and all other damages and
      remedies available to the Company upon Executive’s breach of this Release, the
      Company will be entitled to an injunction to prevent Executive from violating
      or
      breaching this Release. Executive agrees that if the Company is successful
      in
      whole or part in any legal or equitable action against Executive under this
      Release, Executive agree to pay all of the costs, including reasonable
      attorney’s fees, incurred by the Company in enforcing the terms of this
      Release.

     

    9. This
      Release constitutes the complete, final and exclusive embodiment of the entire
      Release between the Parties with regard to this subject matter. It is entered
      into without reliance on any promise or representation, written or oral, other
      than those expressly contained herein, and it supersedes any other such
      promises, warranties or representations. This Release may not be modified or
      amended except in a writing signed by both Executive and a duly authorized
      officer of the Company. This Release will bind the heirs, personal
      representatives, successors and assigns of the Parties, and inure to the benefit
      of the Parties, their heirs, successors and assigns. If any provision of this
      Release is determined to be invalid or unenforceable, in whole or in part,
      this
      determination will not affect any other provision of this Release and the
      provision in question will be modified by the court so as to be rendered
      enforceable. This Release will be deemed to have been entered into and will
      be
      construed and enforced in accordance with the laws of the State of Maryland
      as
      applied to contracts made and to be performed entirely within
      Maryland.

     

    In
      Witness Whereof,
      the
      Parties have duly authorized and caused this Agreement to be executed as
      follows:

    

      
        	
                Micromet,
                  Inc.

              	 	
                Barclay
                  Phillips, an Individual

              
	 	 	 	 
	
                By:

              	 	 	 
	 	
                Name

              	 	 
	 	
                Title

              	 	 
	
                Date: 

              	 	
                  

              	
                Date:

              

      

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Exhibit
      C

     

    DEATH
      BENEFITS RECIPIENTS

    

      
        	
                Primary
                  Beneficiary:

              	 	
                Amount
                  of Payment pursuant to Section 7.5

              
	 	 	 
	
                [__________]

              	 	
                [___]%

              
	 	 	 
	
                Secondary
                  Beneficiary (if Primary Beneficiary pre-deceased):

              
	 	 
	
                [__________]

              	 	
                [___]%

              
	 	 	 
	
                [__________]

              	 	
                [___]%

              

      

    

     

    
      
         

      

      
        -i-

        
          

        

      

      
         

      

    

     

    Exhibit
      D

     

    RELOCATION
      BENEFITS

     

    In
      order
      to facilitate Executive’s and his family’s relocation from his current domicile
      to the area of the Company’s headquarter offices in Bethesda (the “Capital
      Region”), the Company will:

     

    (a) pay
      all
      of Executive’s reasonable expenses for the relocation of Executive and his
      household to the area of the Capital Region, including two house hunting trips
      by Executive and his spouse;

     

    (b) reimburse
      Executive’s transaction costs with respect to the sale of his current home in
      the amount of up to 6% (grossed up for any applicable tax withholding and
      payroll deductions) of the sales price of such home;

     

    (c) reimburse
      up to US$10,000 (net of any applicable tax withholding and payroll deductions)
      of Executive’s closing costs incurred in connection with the purchase of a new
      home in the Capital Region (excluding such costs resulting from the payment
      of
“points” to reduce the mortgage interest rate);

     

    (d) reimburse
      Executive for the cost of renting a temporary apartment in the Capital Region
      for a period ending on the earlier to occur of thirty (30) days after the
      closing of the purchase of Executive’s new home in the Capital Region, and (ii)
      June 30, 2009, and a maximum amount of up to US$15,000 (grossed up for any
      applicable tax withholding and payroll deductions);

     

    (e) if
      the
      sale of Executive’s current home occurs after the purchase of Executive’s new
      home in the Capital Region, the Company will reimburse the mortgage payments
      for
      Executive’s current home during the period starting on the date on which it is
      first offered for sale and ending on the date of closing of the sale;
provided
      that
      such
      reimbursement a maximum amount of up to US$30,000 (grossed up for any applicable
      tax withholding and payroll deductions) and will end no later than June 30,
      2009; and provided
      further that
      Executive will use good faith efforts to effect the sale as soon as
      practicable.

     

    (f) Reimburse
      Executive for the cost of renting or leasing a car in the Capital Region until
      such time as Executive and his family have relocated to said region;
provided
      that such
      reimbursement will not to exceed US$300 per month, and will end no later than
      June 30, 2009; 

     

    (g) Reimburse
      Executive for the cost of flights between Chicago and the DC capital region
      until such time as Executive and his family have relocated to said region;
      provided
      that
      such
      reimbursement will not to exceed $4,500 in total, and will end no later than
      June 30, 2009;

     

    
      
         

      

      
        -i-

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