Document:

DWANGO NORTH AMERICA CORP.

                           2003 EQUITY INCENTIVE PLAN

1. Purpose. The purposes of this 2003 Equity Incentive Plan are (a) to enable
the Company and its Subsidiaries and Affiliates to attract and retain highly
qualified personnel who will contribute to the success of the Company and its
Subsidiaries and Affiliates, and (b) to provide incentives to participants in
this Plan that are linked directly to increases in stockholder value which will
therefore inure to the benefit of all stockholders of the Company and its
Subsidiaries and Affiliates.

      Capitalized terms not defined in the text are defined in Section 24.

2. Administration.

      2.1. Administration in Accordance with the Code and Exchange Act. The Plan
shall be administered in accordance with the requirements of Section 162(m) of
the Code (but only to the extent necessary and desirable to maintain
qualification of Awards under the Plan under Section 162(m) of the Code) and, to
the extent applicable, Rule 16b-3 under the Exchange Act ("Rule 16b-3"), by the
Board or, at the Board's sole discretion, by the Committee, which shall be
appointed by the Board, and which shall serve at the pleasure of the Board.

      2.2. Administrator's Powers. Subject to the general purposes, terms and
conditions of this Plan, the Administrator will have full power to implement and
carry out this Plan. The Administrator will have the authority to:

            (a) construe and interpret this Plan, any Award Agreement and any
other agreement or document executed pursuant to this Plan;

            (b) prescribe, amend and rescind rules and regulations relating to
this Plan or any Award;

            (c) select persons to receive Awards;

            (d) determine the form and terms of Awards;

            (e) determine the number of Shares or other consideration subject to
Awards;

            (f) determine whether Awards will be granted singly, in combination
with, in tandem with, in replacement of, or as alternatives to, other Awards
under this Plan or any other incentive or compensation plan of the Company or
any Parent, Subsidiary or Affiliate of the Company;

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            (g) grant waivers of Plan or Award conditions;

            (h) determine the vesting, exercisability and payment of Awards;

            (i) correct any defect, supply any omission or reconcile any
inconsistency in the Plan, any Award or any Award Agreement;

            (j) to make any adjustments necessary or desirable as a result of
the granting of an Award to an Eligible Participant located outside the United
States;

            (k) determine whether an Award has been earned; and

            (l) make all other determinations necessary or advisable for the
administration of the Plan.

      2.3. Administrator's Discretion Final. Any determination made by the
Administrator with respect to any Award will be made in its sole discretion at
the time of grant of the Award or, unless in contravention of any express term
of the Plan or Award, at any later time, and such determination will be final
and binding on the Company and on all persons having an interest in any Award
under the Plan.

      2.4. Administrator's Method of Acting; Liability. The Administrator may
act only by a majority of its members then in office, except that the members
thereof may authorize any one or more of their members or any officer of the
Company to execute and deliver documents or to take any other ministerial action
on behalf of the Administrator with respect to Awards made or to be made to
Eligible Participants. No member of the Administrator and no officer of the
Company shall be liable for anything done or omitted to be done by such member
or officer, by any other member of the Administrator or by any officer of the
Company in connection with the performance of duties under the Plan, except for
such member's or officer's own willful misconduct or as expressly provided by
law.

3. Participation. Incentive Stock Options may be granted only to employees
(including officers and directors who are also employees) of the Company, or any
Parent, Subsidiary or Affiliate of the Company. All other Awards may be granted
to employees, officers, directors, consultants, independent contractors and
advisors of the Company or any Parent, Subsidiary or Affiliate of the Company;
provided, that such consultants, contractors and advisors render bona fide
services to the Company or such Parent, Subsidiary or Affiliate of the Company
not in connection with the offer and sale of securities in a capital-raising
transaction. An Eligible Participant may be granted more than one Award under
the Plan.

4. Awards Under the Plan.

      4.1. Types of Awards. Awards under the Plan may include, but need not be
limited to, one or more of the following types, either alone or in any
combination thereof:

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            (a) Options;

            (b) Restricted Stock;

            (c) Stock Bonuses; and

            (d) any other type of Award deemed by the Administrator to be
consistent with the purposes of the Plan (including but not limited to, Awards
of or options or similar rights granted with respect to unbundled stock units or
components thereof, and Awards to be made to participants who are foreign
nationals or are employed or performing services outside the United States).

      4.2. Number of Shares Available Under the Plan. Subject to Section 4.4,
the total number of Shares reserved and available for grant and issuance
pursuant to the Plan will be 3,000,000. Shares that are subject to (a) issuance
upon exercise of an Option previously granted but cease to be subject to such
Option for any reason other than exercise of such Option, (b) an Award
previously granted but forfeited or repurchased by the Company at the original
issue price, and (c) an Award previously granted that otherwise terminates
without Shares being issued, shall be available for grant and issuance.

      Shares may consist, in whole or in part, of authorized and unissued shares
or treasury shares.

      The number of Shares which are transferred to the Company by a Participant
to pay the exercise or purchase price of an Award will be subtracted from the
number of Shares issued with respect to such Award for the purpose of counting
Shares used under the Plan. Shares withheld to pay withholding taxes in
connection with the exercise or repayment of an Award will not be counted as
used under the Plan. In addition, Shares covered by an Award granted under the
Plan which is settled in cash will not be counted as used under the Plan.

      4.3. Reservation of Shares. At all times, the Company shall reserve and
keep available a sufficient number of Shares as shall be required to satisfy the
requirements of all outstanding Options granted under the Plan and all other
outstanding but unexercised Awards granted under the Plan.

      4.4. Adjustment in Number of Shares Available Under the Plan. In the event
that the number of outstanding shares of Common Stock is changed by a stock
dividend, recapitalization, stock split, reverse stock split, subdivision,
combination, reclassification or similar change in the capital structure of the
Company without consideration, then (a) the number of Shares reserved for
issuance under the Plan, (b) the number of Shares that may be granted pursuant
to the Plan, (c) the Exercise Prices of and number of Shares subject to
outstanding Options and other Awards, and (d) the exercise prices of and number
of Shares subject to other outstanding Awards, will be proportionately adjusted,
subject to any required action by the Board or the stockholders of the Company
and compliance with applicable securities laws; provided, however, that, upon
occurrence of such an event, fractions of a Share will not be issued upon
exercise of an Award but will, upon such exercise, either be replaced by a cash
payment equal to the Fair Market Value of such fraction of a Share on the
effective date of such an event or will be rounded up to the nearest whole
Share, as determined by the Administrator.

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      4.5. Rights with Respect to Common Shares and Other Securities.

            (a) Unless otherwise determined by the Administrator, a Participant
to whom an Award of Restricted Stock has been made (and any person succeeding to
such Participant's rights with respect to such Award pursuant to the Plan) shall
have, after issuance of a certificate or copy thereof for the number of Shares
so awarded and prior to the expiration of the Restricted Period or the earlier
repurchase of such Shares as provided in the Plan or Award Agreement with
respect to such Award of Restricted Stock, ownership of such Shares, including
the right to vote the same and to receive dividends or other distributions made
or paid with respect to such Shares (provided that such Shares, and any new,
additional or different shares, or other securities or property of the Company,
or other forms of consideration which the participant may be entitled to receive
with respect to such Shares as a result of a stock split, stock dividend or any
other change in the corporate or capital structure of the Company, shall be
subject to the restrictions of the Plan as determined by the Administrator),
subject, however, to the options, restrictions and limitations imposed thereon
pursuant to the Plan. Notwithstanding the foregoing, unless otherwise determined
by the Administrator, a Participant with whom an Award Agreement is made to
issue Shares in the future shall have no rights as a stockholder with respect to
Shares related to such Award Agreement until a stock certificate evidencing such
Shares is issued to such Participant.

            (b) Unless otherwise determined by the Administrator, a Participant
to whom a grant of Stock Options or any other Award is made (and any person
succeeding to such Participant's rights pursuant to the Plan) shall have no
rights as a stockholder with respect to any Shares or as a holder with respect
to other securities, if any, issuable pursuant to any such Award until the date
a stock certificate evidencing such Shares or other instrument of ownership, if
any, is issued to such Participant. Except as provided in Section 4.4, no
adjustment shall be made for dividends, distributions or other rights (whether
ordinary or extraordinary, and whether in cash, securities, other property or
other forms of consideration, or any combination thereof) for which the record
date is prior to the date such stock certificate or other instrument of
ownership, if any, is issued.

5. Stock Options.

      5.1. Grant; Determination of Type of Option. The Administrator may grant
one or more Options to an Eligible Participant and will determine (a) whether
each such Option will be an Incentive Stock Option or a Non-Qualified Stock
Option, (b) the number of Shares subject to each such Option, (c) the Exercise
Price of each such Option, (d) the period during which each such Option may be
exercised, and (e) all other terms and conditions of each such Option, subject
to the terms and conditions of this Section 5. The Administrator may grant an
Option either alone or in conjunction with other Awards, either at the time of
grant or by amendment thereafter.

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      5.2. Form of Option Award Agreement. Each Option granted under the Plan
will be evidenced by an Award Agreement which will expressly identify the Option
as an Incentive Stock Option or a Non-Qualified Stock Option, and will be in
such form and contain such provisions (which need not be the same for each
Participant or Option) as the Administrator may from time to time approve, and
which will comply with and be subject to the terms and conditions of the Plan.

      5.3. Date of Grant. The date of grant of an Option will be the date on
which the Administrator makes the determination to grant such Option, unless
otherwise specified by the Administrator.

      5.4. Exercise Period. Each Option shall be exercisable within the times or
upon the occurrence of one or more events determined by the Administrator and
set forth in the Award Agreement governing such Option; provided, however, that
no Option will be exercisable after the expiration of ten years from the date
the Option is granted; and provided, further, however, that no Incentive Stock
Option granted to a person who directly or by attribution owns more than 10% of
the total combined voting power of all classes of stock of the Company or of any
Parent, Subsidiary or Affiliate of the Company (each, a "Ten Percent
Stockholder") will be exercisable after the expiration of five years from the
date such Incentive Stock Option is granted. The Administrator also may provide
for an Option to become exercisable at one time or from time to time,
periodically or otherwise, in such number of Shares or percentage of Shares as
the Administrator determines.

      5.5. Exercise Price. The Exercise Price of an Option will be determined by
the Administrator when the Option is granted and may be not less than 85% of the
per share Fair Market Value of the Shares subject to such Option on the date of
grant of such Option; provided, however, that: (a) the Exercise Price of an
Incentive Stock Option will be not less than 100% of the per share Fair Market
Value of such Shares on the date of such grant and (b) the Exercise Price of any
Incentive Stock Option granted to a Ten Percent Stockholder will not be less
than 110% of the per share Fair Market Value of such Shares on the date of such
grant. Payment for the Shares purchased shall be made in accordance with Section
8 of the Plan.

      5.6. Method of Exercise. An Option may be exercised only by delivery to
the Company of an irrevocable written exercise notice (a) identifying the Option
being exercised, (b) stating the number of Shares being purchased, (c) providing
any other matters required by the Award Agreement with respect to such Option,
and (d) containing such representations and agreements regarding Participant's
investment intent and access to information and other matters, if any, as may be
required or desirable by the Company to comply with applicable securities laws.
Such exercise notice shall be accompanied by payment in full of the Exercise
Price for the number of Shares being purchased in accordance with Section 8 and
the executed Award Agreement with respect to such Option.

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      5.7. Termination. Notwithstanding anything contained in Section 5.4 or in
an Award Agreement, exercise of Options shall always be subject to the
following:

            (a) If the Participant is Terminated for any reason except death or
Disability, then the Participant may exercise each of such Participant's Options
(i) only to the extent that such Options would have been exercisable on the
Termination Date and (ii) no later than three months after the Termination Date
(or such longer time period not exceeding five years as may be determined by the
Administrator, with any exercise beyond three months after the Termination Date
deemed to be an exercise of an Non-Qualified Stock Option), but in any event, no
later than the original expiration date of such Option;

            (b) If the Participant is Terminated because of Participant's death
or Disability (or the Participant dies within three months after a Termination
other than for Cause or because of Participant's Disability), then each of such
Participant's Options (i) may be exercised only to the extent that such Option
would have been exercisable by Participant on the Termination Date and (ii) must
be exercised by Participant (or Participant's legal representative or authorized
assignee) no later than twelve months after the Termination Date (or such longer
time period not exceeding five years as may be determined by the Administrator,
with any such exercise beyond (A) three months after the Termination Date when
the Termination is for any reason other than the Participant's death or
Disability or (B) twelve months after the Termination Date when the Termination
is because of Participant's death or Disability, deemed to be an exercise of a
Non-Qualified Stock Option), but in any event no later than the original
expiration date of such Option;

            (c) Notwithstanding the provisions in paragraphs 5.7(a) and 5.7(b),
if a Participant is terminated for Cause, neither the Participant, the
Participant's estate nor such other person who may then hold an Option shall be
entitled to exercise such Option whatsoever, whether or not, after the
Termination Date, the Participant may receive payment from the Company or any
Parent, Subsidiary or Affiliate of the Company for vacation pay, for services
rendered prior to the Termination Date, for services rendered for the day on
which Termination occurs, for salary in lieu of notice, for severance or for any
other benefits; provided, however, in making such a determination, the
Administrator shall give the Participant an opportunity to present to the
Administrator evidence on Participant's behalf that the provisions of this
paragraph 5.7(c) should not apply and, in the alternative, paragraph 5.7(a) or
5.7(b) shall apply; provided, further, however, that, for the purpose of this
paragraph 5.7(c), Termination shall be deemed to occur on the date when the
Company dispatches notice or advice to the Participant that such Participant is
Terminated.

      5.8. Limitations on Exercise. The Administrator may specify a reasonable
minimum number of Shares that may be purchased on any exercise of an Option,
provided, that such minimum number will not prevent Participant from exercising
the Option for the full number of Shares for which the Option is then
exercisable.

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      5.9. Limitations on Incentive Stock Options. The aggregate Fair Market
Value (as determined as of the date of grant) of Shares with respect to which an
Incentive Stock Option are exercisable for the first time by a Participant
during any calendar year (under the Plan or under any other incentive stock
option plan of the Company, and any Parent, Subsidiary and Affiliate of the
Company) will not exceed $100,000. If the Fair Market Value of Shares on the
date of grant with respect to which Incentive Stock Option(s) are exercisable
for the first time by a Participant during any calendar year exceeds $100,000,
then the Option(s) for the first $100,000 worth of Shares to become exercisable
in such calendar year will be deemed Incentive Stock Option(s) and the Option(s)
that become exercisable in such calendar year for the number of Shares which
have a Fair Market Value in excess of $100,000 will be deemed to be
Non-Qualified Stock Option(s). In the event that the Code or the regulations
promulgated thereunder are amended after the effective date of the Plan to
provide for a different limit on the Fair Market Value of Shares permitted to be
subject to Incentive Stock Options, such different limit will be automatically
incorporated herein and will apply to any Options granted after the effective
date of such amendment.

      5.10. Modification, Extension or Renewal. The Administrator may modify,
extend or renew any outstanding Option and authorize the grant of one or more
new Options in substitution therefor; provided that any such action may not,
without the written consent of a Participant, impair any of such Participant's
rights under any Option previously granted. Any outstanding Incentive Stock
Option that is modified, extended, renewed or otherwise altered will be treated
in accordance with Section 424(h) and other applicable provisions of the Code.
The Administrator may reduce the Exercise Price of any outstanding Option of a
Participant without the consent of the Participant affected by delivering a
written notice to the Participant; provided, however, that the Exercise Price
may not be reduced below the minimum Exercise Price that would be permitted
under Section 5.5 for Options granted on the date the action is taken to reduce
such Exercise Price.

      5.11. No Disqualification. Notwithstanding any other provision in the
Plan, no term of the Plan relating to an Incentive Stock Option will be
interpreted, amended or altered, nor will any discretion or authority granted
under the Plan be exercised, so as to disqualify the Plan under Section 422 of
the Code or, without the consent of the Participant affected, to disqualify any
Incentive Stock Option under Section 422 of the Code.

      5.12. Prohibition Against Transfer. No Option may be sold, assigned,
transferred, pledged, hypothecated or otherwise disposed of, except by will or
the laws of descent and distribution or pursuant to a domestic relations order,
and a Participant's Option shall be exercisable during such Participant's
lifetime only by such Participant or such person receiving such Option pursuant
to a domestic relations order.

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6. Restricted Stock.

      6.1. Grant. An Award of Restricted Stock is an offer by the Company to
sell to an Eligible Participant Shares that are subject to restrictions. The
Administrator will determine to whom an offer will be made, the number of Shares
the person may purchase, the Exercise Price to be paid, the restrictions to
which the Shares will be subject, and all other terms and conditions of the
Restricted Stock Award, subject to the provisions of this Section 6.

      6.2 Form of Restricted Stock Award. All purchases under an Award of
Restricted Stock will be evidenced by an Award Agreement that will be in such
form (which need not be the same for each Award of Restricted Stock or
Participant) as the Administrator will from time to time approve, and will
comply with and be subject to the terms and conditions of the Plan. The offer of
Restricted Stock will be accepted by the Participant's execution and delivery of
the Award Agreement evidencing the offer to purchase the Restricted Stock and
full payment for the Shares to the Company within 30 days from the date such
Award Agreement is tendered to such Eligible Participant. If such Eligible
Participant does not execute and deliver such Award Agreement along with full
payment for the Shares to the Company within such 30 day period, then such offer
will terminate, unless otherwise determined by the Administrator.

      6.3. Purchase Price. The Exercise Price of Shares sold pursuant to an
Award of Restricted Stock will be determined by the Administrator on the date
such Award is granted, except in the case of a sale to a Ten Percent
Stockholder, in which case the Exercise Price will be 100% of the per share Fair
Market Value on the date such Award is granted of the Shares subject to the
Award. Payment of the Exercise Price may be made in accordance with Section 8.

      6.4. Terms of Restricted Stock Awards. Each Award of Restricted Stock
shall be subject to such restrictions as the Administrator may impose. These
restrictions may be based upon completion of a specified number of years of
service with the Company or upon completion of the performance goals as set out
in advance in the Participant's individual Award Agreement. Awards of Restricted
Stock may vary from Participant to Participant and between groups of
Participants. Prior to the grant of an Award of Restricted Stock, the
Administrator shall:

            (a) determine the nature, length and starting date of any
performance period for the Restricted Stock Award;

            (b) select from among the performance factors to be used to measure
performance goals, if any; and

            (c) determine the number of Shares that may be awarded to the
Participant.

      Prior to the payment of any Restricted Stock pursuant to an Award, the
Administrator shall determine the extent to which such Restricted Stock Award
has been earned. Performance periods may overlap and Participants may
participate simultaneously with respect to Restricted Stock Awards that are
subject to different performance periods and having different performance goals
and other criteria.

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      6.5. Termination During Performance Period. If a Participant is Terminated
during a performance period with respect to any Award of Restricted Stock for
any reason, then such Participant will be entitled to payment (whether in
Shares, cash or otherwise) with respect to the Restricted Stock Award only to
the extent earned as of the date of Termination in accordance with the Award
Agreement with respect to such Restricted Stock, unless the Administrator
determines otherwise.

7. Stock Bonuses.

      7.1. Awards of Stock Bonuses. A Stock Bonus is an Award of Shares (which
may consist of Restricted Stock) for services rendered to the Company or any
Parent, Subsidiary or Affiliate of the Company. A Stock Bonus may be awarded for
past services already rendered to the Company, or any Parent, Subsidiary or
Affiliate of the Company pursuant to an Award Agreement (the "Stock Bonus
Agreement") that will be in such form (which need not be the same for each
Participant) as the Administrator will from time to time approve, and will
comply with and be subject to the terms and conditions of the Plan. A Stock
Bonus may be awarded upon satisfaction of such performance goals as are set out
in advance in the Participant's individual Award Agreement that will be in such
form (which need not be the same for each Participant) as the Administrator will
from time to time approve, and will comply with and be subject to the terms and
conditions of the Plan. Stock Bonuses may vary from Participant to Participant
and between groups of Participants, and may be based upon the achievement of the
Company, any Parent, Subsidiary or Affiliate of the Company and/or individual
performance factors or upon such other criteria as the Administrator may
determine.

      7.2 Terms of Stock Bonuses. The Administrator will determine the number of
Shares to be awarded to the Participant. If the Stock Bonus is being earned upon
the satisfaction of performance goals set forth in an Award Agreement, then the
Administrator will:

            (a) determine the nature, length and starting date of any
performance period for each Stock Bonus;

            (b) select from among the performance factors to be used to measure
the performance, if any; and

            (c) determine the number of Shares that may be awarded to the
Participant.

      Prior to the payment of any Stock Bonus, the Administrator shall determine
the extent to which such Stock Bonuses have been earned. Performance periods may
overlap and Participants may participate simultaneously with respect to Stock
Bonuses that are subject to different performance periods and different
performance goals and other criteria. The number of Shares may be fixed or may
vary in accordance with such performance goals and criteria as may be determined
by the Administrator. The Administrator may adjust the performance goals
applicable to the Stock Bonuses to take into account changes in law and
accounting or tax rules and to make such adjustments as the Administrator deems
necessary or appropriate to reflect the impact of extraordinary or unusual
items, events or circumstances to avoid windfalls or hardships.

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      7.3. Form of Payment. The earned portion of a Stock Bonus may be paid
currently or on a deferred basis with such interest or dividend equivalent, if
any, as the Administrator may determine. Payment may be made in the form of cash
or whole Shares or a combination thereof, either in a lump sum payment or in
installments, all as the Administrator will determine.

8. Payment for Share Purchases.

      8.1. Payment. Payment for Shares purchased pursuant to this Plan may be
made in cash (by check) or, where expressly approved for the Participant by the
Administrator and where permitted by law:

            (a) by cancellation of indebtedness of the Company to the
Participant;

            (b) by surrender of Shares that either (i) have been owned by the
Participant for more than six months and have been paid for within the meaning
of Rule 144 promulgated under the Securities Act (and, if such shares were
purchased from the Company by use of a promissory note, such note has been fully
paid with respect to such shares) or (ii) were obtained by Participant in the
public market;

            (c) by tender of a full recourse promissory note having such terms
as may be approved by the Administrator and bearing interest at a rate
sufficient to avoid imputation of income under Sections 483 and 1274 of the
Code; provided, however, that Participants who are not employees or directors of
the Company will not be entitled to purchase Shares with a promissory note
unless the note is adequately secured by collateral other than the Shares;

            (d) by waiver of compensation due or accrued to the Participant for
services rendered;

            (e) with respect only to purchases upon exercise of an Option, and
provided that a public market for the Company's stock exists, (i) through a
"same day sale" commitment from the Participant and a broker-dealer that is a
member of the National Association of Securities Dealers (an "NASD Dealer")
whereby the Participant irrevocably elects to exercise the Option and to sell a
portion of the Shares so purchased to pay for the Exercise Price, and whereby
the NASD Dealer irrevocably commits upon receipt of such Shares to forward the
Exercise Price directly to the Company, or (ii) through a "margin" commitment
from the Participant and an NASD Dealer whereby the Participant irrevocably
elects to exercise the Option and to pledge the Shares so purchased to the NASD
Dealer in a margin account as security for a loan from the NASD Dealer in the
amount of the Exercise Price, and whereby the NASD Dealer irrevocably commits
upon receipt of such Shares to forward the Exercise Price directly to the
Company; or

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            (f) by any combination of the foregoing.

      8.2. Loan Guarantees. The Company, in its sole discretion, may assist a
Participant in paying for Shares purchased under the Plan by authorizing a
guarantee by the Company of a third-party loan to the Participant.

9. Amendment or Substitution of Awards Under the Plan. The terms of any
outstanding Award under the Plan may be amended from time to time by the
Administrator in any manner that the Administrator deems appropriate (including,
but not limited to, acceleration of the date of exercise of any Award and/or
payments thereunder, or reduction of the Exercise Price of an Award); provided,
however, that no such amendment shall adversely affect in a material manner any
right of a Participant under such Award without the Participant's written
consent. The Administrator may permit or require holders of Awards to surrender
outstanding Awards as a condition precedent to the grant of new Awards under the
Plan.

10. Designation of Beneficiary by Participant. A Participant may designate one
or more beneficiaries to receive any rights and payments to which such
Participant may be entitled in respect of any Award in the event of such
Participant's death. Such designation shall be on a written form acceptable to
and filed with the Administrator. The Administrator shall have the right to
review and approve beneficiary designations. A Participant may change the
Participant's beneficiary(ies) from time to time in the same manner as the
original designation, unless such Participant has made an irrevocable
designation. Any designation of beneficiary under the Plan (to the extent it is
valid and enforceable under applicable law) shall be controlling over any other
disposition, testamentary or otherwise, as determined by the Administrator. If
no designated beneficiary survives the Participant and is living on the date on
which any right or amount becomes payable to such Participant's
beneficiary(ies), such payment will be made to the legal representatives of the
Participant's estate, and the term "beneficiary" as used in the Plan shall be
deemed to include such person or persons. If there is any question as to the
legal right of any beneficiary to receive a distribution under the Plan, the
Administrator may determine that the amount in question be paid to the legal
representatives of the estate of the Participant, in which event the Company,
the Administrator, the Board and the Committee and the members thereof will have
no further liability to any person or entity with respect to such amount.

11. Corporate Transactions.

      11.1. Assumption or Replacement of Awards by Successor. If a
Change-of-Control Event occurs:

            (a) the successor company in any Change-of-Control Event may, if
approved in writing by the Administrator prior to any Change-of-Control Event,
(i) substitute equivalent Options or Awards or provide substantially similar
consideration to Participants as was provided to stockholders (after taking into
account the existing provisions of the Awards), or (ii) issue, in place of
outstanding Shares of the Company held by the Participant, substantially similar
shares or substantially similar other securities or substantially similar other
property subject to repurchase restrictions no less favorable to the
Participant.

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            (b) notwithstanding anything in this Plan to the contrary, the
Administrator may, in its sole discretion, provide that the vesting of any or
all Options and Awards granted pursuant to this Plan will accelerate immediately
prior to the consummation of a Change-of-Control Event. If the Administrator
exercises such discretion with respect to Options, such Options will become
exercisable in full prior to the consummation of such event at such time and on
such conditions as the Administrator determines, and if such Options are not
exercised prior to the consummation of such event, they shall terminate at such
time as determined by the Administrator.

      11.2. Other Treatment of Awards. Subject to any rights and limitations set
forth in Section 11.1, if a Change-of-Control Event occurs or has occurred, any
outstanding Awards will be treated as provided in the applicable agreement or
plan of merger, consolidation, dissolution, liquidation, or sale of assets
constituting the Change-of-Control Event.

      11.3 Assumption of Awards by the Company. The Company, from time to time,
also may substitute or assume outstanding awards granted by another company,
whether in connection with an acquisition of such other company or otherwise, by
either (a) granting an Award under this Plan in substitution of such other
company's award, or (b) assuming such award as if it had been granted under this
Plan if the terms of such assumed award could be applied to an Award granted
under this Plan. Such substitution or assumption will be permissible if the
holder of the substituted or assumed award would have been eligible to be
granted an Award under this Plan if the other company had applied the rules of
this Plan to such grant. If the Company assumes an award granted by another
company, the terms and conditions of such award will remain unchanged (except
that the exercise price and the number and nature of Shares issuable upon
exercise of any such option will be adjusted appropriately pursuant to Section
424(a) of the Code). If the Company elects to grant a new Option rather than
assuming an existing option, such new Option may be granted with a similarly
adjusted Exercise Price.

12. Plan Amendment or Suspension. The Plan may be amended or suspended in whole
or in part at any time and from time to time by the Board, but no amendment
shall be effective unless and until the same is approved by stockholders of the
Company where the failure to obtain such approval would adversely affect the
compliance of the Plan with Sections 162 and 422 of the Code, Rule 16b-3 and
with other applicable law. No amendment of the Plan shall adversely affect in a
material manner any right of any Participant with respect to any Award
theretofore granted without such Participant's written consent.

13. Plan Termination.

      13.1. Method of Plan Termination. The Plan shall terminate upon the
earlier of the following dates or events to occur:

                                       12
<PAGE>

            (a) upon the adoption of a resolution of the Board terminating the
Plan; or

            (b) September 17, 2013.

      13.2. Effect of Termination on Outstanding Awards. No termination of the
Plan shall materially alter or impair any of the rights or obligations of any
person, without such person's consent, under any Award theretofore granted under
the Plan, except that subsequent to termination of the Plan, the Administrator
may make amendments permitted under Section 9.

14. Stockholder Adoption.

      14.1. Stockholder Approval. The Plan shall be submitted to the
stockholders of the Company for their approval and adoption.

      14.2. Effectiveness of Plan Prior to Stockholder Approval. The Plan shall
not be effective and no Award shall be made hereunder unless and until the Plan
has been approved by the stockholders of the Company as provided in Section
14.1, consistent with applicable law.

15. Transferability. Except as may be approved by the Administrator where such
approval shall not adversely affect compliance of the Plan with Sections 162 and
422 of the Code and/or Rule 16b-3, a Participant's rights and interest under the
Plan may not be assigned or transferred, hypothecated or encumbered in whole or
in part either directly or by operation of law or otherwise (except in the event
of a Participant's death) including, but not by way of limitation, execution,
levy, garnishment, attachment, pledge, bankruptcy or in any other manner;
provided, however, that any Option or similar right offered pursuant to the Plan
shall not be transferable other than by will or the laws of descent or pursuant
to a domestic relations order and shall be exercisable during the Participant's
lifetime only by such Participant or such person receiving such option pursuant
to a domestic relations order.

16. Privileges of Stock Ownership; Restrictions on Shares.

      16.1. Voting and Dividends. No Participant will have any of the rights of
a stockholder with respect to any Shares subject to or issued pursuant to the
Plan until such Shares are issued to the Participant. After Shares are issued to
the Participant, the Participant will be a stockholder and have all the rights
of a stockholder with respect to such Shares, including the right to vote and
receive all dividends or other distributions made or paid with respect to such
Shares; provided, however, that if such Shares are Restricted Stock, then any
new, additional or different securities the Participant may become entitled to
receive with respect to such Shares by virtue of a stock dividend, stock split
or any other change in the corporate or capital structure of the Company will be
subject to the same restrictions as the Restricted Stock; provided, further,
that the Participant will have no right to retain such stock dividends or stock
distributions with respect to Restricted Stock that is repurchased at the
Participant's Exercise Price in accordance with an Award Agreement with respect
to such Restricted Stock.

                                       13
<PAGE>

      16.2. Restrictions on Shares. At the discretion of the Administrator, the
Company may reserve to itself and/or its assignee(s) in the Award Agreement a
right to repurchase a portion of or all Shares issued pursuant to such Award
Agreement and held by a Participant following such Participant's Termination at
any time within 90 days after the later of Participant's Termination Date or the
date Participant purchases Shares under the Plan, for cash and/or cancellation
of purchase money indebtedness, at the Participant's Exercise Price or such
other price as the Administrator may determine at the time of the grant of the
Award.

17. Certificates. All Shares or other securities delivered under this Plan will
be subject to such stock transfer orders, legends and other restrictions as the
Administrator may deem necessary or advisable, including restrictions under any
applicable federal, state or foreign securities law, or any rules, regulations
and other requirements promulgated under such laws or any stock exchange or
automated quotation system upon which the Shares may be listed or quoted and
each stock certificate evidencing such Shares and other certificates shall be
appropriately legended.

18. Escrow; Pledge of Shares. To enforce any restrictions on a Participant's
Shares, the Administrator may require the Participant to deposit all stock
certificates evidencing Shares, together with stock powers or other instruments
of transfer approved by the Administrator, appropriately endorsed in blank, with
the Company or an agent designated by the Company to hold in escrow until such
restrictions have lapsed or terminated, and the Administrator may cause a legend
or legends referencing such restrictions to be placed on the certificates. Any
Participant who is permitted to execute a promissory note as partial or full
consideration for the purchase of Shares under the Plan will be required to
pledge and deposit with the Company all or part of the Shares so purchased as
collateral to secure the payment of Participant's obligation to the Company
under the promissory note; provided, however, that the Administrator may require
or accept other or additional forms of collateral to secure the payment of such
obligation and, in any event, the Company will have full recourse against the
Participant under the promissory note notwithstanding any pledge of the
Participant's Shares or other collateral. In connection with any pledge of the
Shares, Participant will be required to execute and deliver a written pledge
agreement in such form as the Administrator will from time to time approve. The
Shares purchased with the promissory note may be released from the pledge on a
pro rata basis as the promissory note is paid.

19. Exchange and Buyout of Awards.

      19.1. Exchange. The Administrator may, at any time or from time to time,
authorize the Company, with the consent of the respective Participants, to issue
new Awards in exchange for the surrender and cancellation of any or all
outstanding Awards.

      19.2. Buyout of Awards. The Administrator may, at any time or from time to
time, authorize the Company to buy from a Participant an Award previously
granted with payment in cash, Shares (including Restricted Stock) or other
consideration, based on such terms and conditions as the Administrator and the
Participant may agree.

                                       14
<PAGE>

20. Securities Law and Other Regulatory Compliance.

      20.1. Compliance with Applicable Laws. An Award will not be effective
unless such Award is made in compliance with all applicable federal and state
securities laws, rules and regulations of any governmental body, and the
requirements of any stock exchange or automated quotation system upon which the
Shares may then be listed or quoted, as they are in effect on the date of grant
of the Award and also on the date of exercise or other issuance. Notwithstanding
any other provision in this Plan, the Company will have no obligation to issue
or deliver stock certificates for Shares under this Plan prior to:

            (a) obtaining any approvals from governmental agencies that the
Administrator determines are necessary or advisable; and/or

            (b) completion of any registration or other qualification of such
Shares under any state or federal law or ruling of any governmental body that
the Administrator determines to be necessary or advisable.

      20.2. No Obligation to Register Shares or Awards. The Company will be
under no obligation to register the Shares under the Securities Act or to effect
compliance with the registration, qualification or listing requirements of any
state securities laws, stock exchange or automated quotation system, and the
Company will have no liability for any inability or failure to do so.

21. No Obligation to Employ. Nothing in this Plan or any Award granted under the
Plan will confer or be deemed to confer on any Participant any right to continue
in the employ of, or to continue any other relationship with, the Company or any
Parent, Subsidiary or Affiliate of the Company or limit in any way the right of
the Company or any Parent, Subsidiary or Affiliate of the Company to terminate
Participant's employment or other relationship at any time, with or without
cause.

22. Nonexclusivity of the Plan. Neither the adoption of the Plan by the Board,
the submission of the Plan to the stockholders of the Company for approval, nor
any provision of this Plan will be construed as creating any limitations on the
power of the Board or the Committee to adopt such additional compensation
arrangements as the Board may deem desirable, including, without limitation, the
granting of stock options and bonuses otherwise than under the Plan, and such
arrangements may be either generally applicable or applicable only in specific
cases.

23. Miscellaneous Provisions.

      23.1. No Rights Unless Specifically Granted. Unless otherwise expressly
agreed to in writing by the Company, no employee or other person shall have any
claim or right to be granted an Award under the Plan under any contract,
agreement or otherwise. Determinations made by the Administrator under the Plan
need not be uniform and may be made selectively among Eligible Participants
under the Plan, whether or not such Eligible Participants are similarly
situated.

                                       15
<PAGE>

      23.2. No Rights Until Written Evidence Delivered. No Participant or other
person shall have any right with respect to the Plan, the Shares reserved for
issuance under the Plan or in any Award, contingent or otherwise, until written
evidence of the Award, in the form of an Award Agreement, shall have been
delivered to the recipient and all the terms, conditions and provisions of the
Plan and the Award applicable to such recipient (and each person claiming under
or through such recipient) have been met.

      23.3. Compliance with Applicable Law. No Shares, other Company securities
or property, other securities or property, or other forms of payment shall be
issued hereunder with respect to any Award unless counsel for the Company shall
be satisfied that such issuance will be in compliance with applicable federal,
state, local and foreign legal, securities exchange and other applicable
requirements.

      23.4. Compliance with Rule 16b-3. If and when the provisions of Section 16
become applicable with respect to the securities of the Company, it is the
intent of the Company that the Plan comply in all respects with Rule 16b-3 under
the Exchange Act, that any ambiguities or inconsistencies in construction of the
Plan be interpreted to give effect to such intention and that if any provision
of the Plan is found not to be in compliance with Rule 16b-3, such provision
shall be deemed null and void to the extent required to permit the Plan to
comply with Rule 16b-3.

      23.5. Right to Withhold Payments. The Company and any Parent, Subsidiary
and Affiliate of the Company shall have the right to deduct from any payment
made under the Plan, any federal, state, local or foreign income or other taxes
required by law to be withheld with respect to such payment. It shall be a
condition to the obligation of the Company to issue Shares, other securities or
property of the Company, other securities or property, or other forms of
payment, or any combination thereof, upon exercise, settlement or payment of any
Award under the Plan, that the Participant (or any beneficiary or person
entitled to act) pay to the Company, upon its demand, such amount as may be
requested by the Company for the purpose of satisfying any liability to withhold
federal, state, local or foreign income or other taxes. If the amount requested
is not paid, the Company may refuse to issue Shares, other securities or
property of the Company, other securities or property, or other forms of
payment, or any combination thereof. Notwithstanding anything in the Plan to the
contrary, the Administrator may permit an Eligible Participant (or any
beneficiary or person entitled to act) to elect to pay a portion or all of the
amount requested by the Company for such taxes with respect to such Award, at
such time and in such manner as the Administrator shall deem to be appropriate,
including, but not limited to, by authorizing the Company to withhold, or
agreeing to surrender to the Company on or about the date such tax liability is
determinable, Shares, other securities or property of the Company, other
securities or property, or other forms of payment, or any combination thereof,
owned by such person or a portion of such forms of payment that would otherwise
be distributed, or have been distributed, as the case may be, pursuant to such
Award to such person, having a fair market value equal to the amount of such
taxes.

                                       16
<PAGE>

      23.6. Expenses of Administration. The expenses of administering the Plan
shall be borne by the Company and its Subsidiaries and Affiliates.

      23.7. Unfunded Plan. The Plan shall be unfunded. The Company shall not be
required to establish any special or separate fund or to make any other
segregation of assets to assure the payment of any Award under the Plan, and
rights to the payment of Awards shall be no greater than the rights of the
Company's general creditors.

      23.8. Acceptance of Award Deemed Consent. By accepting any Award or other
benefit under the Plan, each Participant and each person claiming under or
through such Participant shall be conclusively deemed to have indicated such
Participant's (or other person's) acceptance and ratification of, and consent
to, any action taken by the Company, Administrator, Board or Committee or their
respective delegates under the Plan.

      23.9. Fair Market Value Determined By the Administrator. Fair market value
in relation to other securities or property of the Company, other securities or
property or other forms of payment of Awards under the Plan, or any combination
thereof, as of any specific time, shall mean such value as determined by the
Administrator in accordance with the Plan and applicable law.

      23.10. Use of Terms. For the purposes of the Plan, in the use of any term,
the singular includes the plural and the plural includes the singular wherever
appropriate.

      23.11. Validity; Construction; Interpretation. The validity, construction,
interpretation, administration and effect of the Plan, and of its rules and
regulations, and rights relating to the Plan and Award Agreements and to Awards
granted under the Plan, shall be governed by the substantive laws, but not the
choice of law rules, of the State of Texas.

24. Definitions. As used in this Plan, except as otherwise defined, the
following terms will have the following meanings:

      "Administrator" means the Board or, if and to the extent the Board elects
to delegate the administration of the Plan or does not administer the Plan, the
Committee.

      "Affiliate" means any entity or person that directly, or indirectly
through one or more intermediaries, controls, is controlled by, or is under
common control with, another entity, where "control" (including the terms
"controlled by" and "under common control with") means the possession, directly
or indirectly, of the power to cause the direction of the management and
policies of the entity, whether through the ownership of voting securities, by
contract or otherwise.

                                       17
<PAGE>

      "Award" means any award under the Plan.

      "Award Agreement" means, with respect to each Award, the signed written
agreement between the Company and the Participant setting forth the terms and
conditions of the Award.

      "Board" means the Board of Directors of the Company.

      "Cause" means the commission of any act of a material theft, embezzlement
or fraud involving the Company or any Parent, Subsidiary or Affiliate of the
Company, the Participant having been convicted of a crime (other than minor
traffic violations and other minor misdemeanors), or a breach of fiduciary duty
to the Company or any Parent, Subsidiary or Affiliate of the Company.

      "Change-of-Control Event" means any one or more of the following: (i) a
dissolution or liquidation of the Company, (ii) a merger or consolidation in
which the Company is not the surviving corporation (other than a merger or
consolidation with a wholly-owned subsidiary, a reincorporation of the Company
in a different jurisdiction, or other transaction in which there is no
substantial change in the stockholders of the Company or their relative stock
holdings and the Awards granted under this Plan are assumed, converted or
replaced by the successor corporation, which assumption will be binding on all
Participants), (iii) a merger in which the Company is the surviving corporation
but after which the stockholders of the Company immediately prior to such merger
(other than any stockholder that merges, or which owns or controls another
corporation that merges, with the Company in such merger) cease to own their
Shares or other equity interest in the Company, (iv) the sale of substantially
all of the assets of the Company, or (v) the acquisition, sale, or other
transfer of more than 50% of the outstanding capital stock of the Company by
tender offer or similar transaction.

      "Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor thereto.

      "Committee" means compensation or other any committee the Board may
appoint to administer the Plan. To the extent necessary and desirable, the
Committee shall be composed entirely of individuals who meet the qualifications
referred to in Section 162(m) of the Code and Rule 16b-3 under the Exchange Act.
If at any time or to any extent the Board shall not administer the Plan, then
the functions of the Board specified in the Plan shall be exercised by the
Committee.

      "Common Stock" means the common stock, par value $.001 per share, of the
Company.

      "Company" means Woodland Hatchery, Inc., a Nevada corporation, or any
successor corporation.

      "Disability" means the inability of a Participant to perform substantially
his or her duties and responsibilities to the Company or to any Parent,
Subsidiary or Affiliate by reason of a physical or mental disability or
infirmity for a continuous period of six months, as determined by the
Administrator. The date of such Disability shall be the last day of such
six-month period or the date on which the Participant submits such medical
evidence, satisfactory to the Administrator, that the Participant has a physical
or mental disability or infirmity that will likely prevent the Participant from
performing the Participant's work duties for a continuous period of six months
or longer, as the case may be.

                                       18
<PAGE>

      "Eligible Participant" means an officer, director, employee, consultant or
advisor of the Company or of any Parent, Subsidiary or Affiliate. For purposes
of the Plan, the term "employee" shall include all those individuals whose
service with or for the Company and/or any Parent, Subsidiary or Affiliate of
the Company, is within the definition of "employee" in the Rule as to the Use of
Form S-8 contained in the General Instructions for the registration statement on
Form S-8 promulgated by the Securities and Exchange Commission.

      "Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time.

      "Exercise Price" means the per share price at which a holder of an Award
may purchase the Shares issuable upon exercise of such Award.

      "Fair Market Value" as of a particular date shall mean the fair market
value of a share of Common Stock as determined by the Administrator; provided,
however, that Fair Market Value shall mean (i) if the Common Stock is listed or
admitted to trade on a national securities exchange, the closing price of the
Common Stock on the Composite Tape, as published in The Wall Street Journal, of
the principal national securities exchange on which the Common Stock is so
listed or admitted to trade, on such date, or, if there is no trading of the
Common Stock on such date, then the closing price of the Common Stock as quoted
on such Composite Tape on the next preceding date on which there was trading in
such shares; (ii) if the Common Stock is not listed or admitted to trade on a
national securities exchange but is listed and quoted on The Nasdaq Stock Market
("Nasdaq"), the last sale price for the Common Stock on such date as reported by
Nasdaq, or, if there is no reported trading of the Common Stock on such date,
then the last sale price for the Common Stock on the next preceding date on
which there was trading in the Common Stock; (iii) if the Common Stock is not
listed or admitted to trade on a national securities exchange and is not listed
and quoted on Nasdaq, the mean between the closing bid and asked price for the
Common Stock on such date, as furnished by the National Association of
Securities Dealers, Inc. ("NASD"); (iv) if the Common Stock is not listed or
admitted to trade on a national securities exchange, not listed and quoted on
Nasdaq and closing bid and asked prices are not furnished by the NASD, the mean
between the closing bid and asked price for the Common Stock on such date, as
furnished by the National Quotation Bureau ("NQB") or similar organization; and
(v) if the stock is not listed or admitted to trade on a national securities
exchange, not listed and quoted on Nasdaq and if bid and asked prices for the
Common Stock are not furnished by the NASD, NQB or a similar organization, the
value established in good faith by the Administrator.

                                       19
<PAGE>

      "Incentive Stock Option" means any Option intended to be designated as an
"incentive stock option" within the meaning of Section 422 of the Code.

      "Non-Qualified Stock Option" means any Option that is not an Incentive
Stock Option, including, but not limited to, any Option that provides (as of the
time such Option is granted) that it will not be treated as an Incentive Stock
Option.

      "Option" means an option to purchase Shares granted pursuant to Section 5.

      "Parent" means any corporation (other than the Company) in an unbroken
chain of corporations ending with the Company, if each of the corporations in
the chain (other than the Company) owns stock possessing 50% or more of the
combined voting power of all classes of stock in one of the other corporations
in the chain.

      "Participant" means any Eligible Recipient selected by the Administrator,
pursuant to the Administrator's authority, to receive grants of Options, awards
of Restricted Stock, Stock Bonuses or other types of awards, or any combination
of the foregoing.

      "Plan" means this 2003 Equity Incentive Plan.

      "Restricted Stock" means Shares subject to certain restrictions granted
pursuant to Section 6.

      "Restricted Period" means the period of time Restricted Stock remains
subject to restrictions imposed on the Award of such Restricted Stock.

      "Securities Act" means the Securities Act of 1933, as amended from time to
time.

      "Shares" means shares of Common Stock reserved for issuance under or
issued pursuant to the Plan, as adjusted pursuant to Section 4, and any
successor security.

      "Stock Bonus" means an Award granted pursuant to Section 7.

      "Subsidiary" means any corporation (other than the Company) in an unbroken
chain of corporations beginning with the Company, if each of the corporations
(other than the last corporation) in the unbroken chain owns stock possessing
50% or more of the total combined voting power of all classes of stock in one of
the other corporations in the chain.

      "Ten Percent Stockholder" shall have the meaning assigned to it in Section
5.4.

                                       20
<PAGE>

      "Termination" or "Terminated" means, for purposes of the Plan with respect
to a Participant, that such Participant has for any reason ceased to provide
services as an employee, officer, director, consultant, independent contractor,
or advisor to the Company or any Parent, Subsidiary or Affiliate of the Company.
A Participant will not be deemed to have ceased to provide services in the case
of (i) sick leave, (ii) military leave, or (iii) any other leave of absence
approved by the Administrator, provided, that such leave is for a period of not
more than 90 days, unless re-employment or reinstatement upon the expiration of
such leave is guaranteed by contract or statute or unless provided otherwise
pursuant to formal policy adopted from time to time by the Company and issued
and promulgated to employees and other participants in writing. In the case of
any Participant on an approved leave of absence, the Administrator may make such
provisions respecting suspension of vesting of any Award previously granted to
such Participant while such Participant is on leave from the Company or any
Parent, Subsidiary or Affiliate of the Company as the Administrator may deem
appropriate, except that in no event may an Option be exercised after the
expiration of the term set forth in the Award Agreement with respect to such
Option. The Administrator will have sole discretion to determine whether a
Participant has ceased to provide services and the applicable Termination Date.

         "Termination  Date"  means  the  effective  date  of  Termination,   as
determined by the Administrator.

                                       21Restricted Stock Award Agreement

  
 EXHIBIT 10.68

  
 RESTRICTED STOCK AWARD AGREEMENT 
  

			
	Granted to:	  	Michael L Fulbright
		
	Date of Grant:	  	August 5, 2003
		
	Granted Pursuant to:	  	JPS Industries, Inc. 1997 Incentive and Capital Accumulation Plan
		
	 Number of Restricted
 Shares of
Common
 Stock:
	  	200,000 Shares

  
 This Restricted Stock
Award Agreement (the “Award Agreement”) is made and entered into as of August 5, 2003, between JPS Industries, Inc., a Delaware corporation (the “Company”), and Michael L. Fulbright (“Employee”). Capitalized terms not
defined herein shall have the meanings ascribed thereto in that certain letter agreement between Employee and the Company, dated February 28, 1999, as amended by letter agreement on July 31, 2001 and further amended by letter agreement on August 5,
2003 (the “Employment Agreement”). 
  
 1. Grant of Restricted Shares. In consideration of Employee’s acceptance of the terms and conditions of the Employment Agreement and without other payments therefore, and subject to the terms of this Award Agreement and the
Company’s 1997 Incentive and Capital Accumulation Plan, as amended (the “Plan”), the Company, pursuant to authority granted by the Compensation Committee of the Board of Directors of the Company (the “Board”), hereby grants
to Employee 200,000 shares of the Company’s common stock, par value $.01 per share (“Common Stock”). The shares of restricted stock so granted (the “Restricted Shares”) shall be represented by certificates registered in
Employee’s name and bearing a legend referring to the restrictions set forth in this Award Agreement. 
  
 2. Restriction on Transfer of Restricted Shares. Employee may not transfer, sell, pledge, exchange, assign or otherwise encumber or
dispose the Restricted Shares, except to the Company, until they have become nonforfeitable in accordance with Section 3 of this Award Agreement. Any purported transfer, encumbrance or other disposition of the Restricted Shares that is in violation
of this Section 2 will be null and void, and the other party to any such purported transaction will not obtain any rights to, or interest in, the Restricted Shares. 
  
 3. Vesting of Restricted Shares. The Restricted Shares shall vest over four (4) years, as described
below. (a) 50,000 shares on November 3, 2003, (b) 50,000 shares on November 1, 2004, (c) 50,000 shares on November 1, 2005 and (d) 50,000 shares on November 1, 2006. The vesting provisions of this Section 3 are subject to Employee remaining in the

  

 
continuous employ of the Company. For purposes of this Award Agreement, the continuous employment of Employee with the Company shall not be deemed to have
been interrupted, and Employee shall not be deemed to have ceased to be an employee of the Company, by reason of a leave of absence of not more than thirty (30) days, unless otherwise approved by the Board or a committee thereof. 
  
 4. Termination of Rights and Forfeiture of Restricted
Shares. 
  
 (a) Termination for Cause or
Voluntary Termination. In the event Employee’s employment pursuant to the Employment Agreement is terminated by the Company for Cause or by Employee other than for Good Reason, Employee shall be entitled to any Restricted Shares that have
become nonforfeitable pursuant to Section 3 of this Award Agreement. Any Restricted Shares that have not heretofore become nonforfeitable (the “Unvested Shares”) shall be forfeited. 
  
 (b) Termination other than for Cause or Involuntary
Termination. In the even Employee’s employment pursuant to the Employment Agreement is terminated by the Company other than for Cause or by Employee for Good Reason, Employee shall be entitled, on the date of termination, to: (i) any
Restricted Shares that have become nonforfeitable pursuant to Section 3 of this Award Agreement, and (ii) any Unvested Shares. 
  
 (c) Termination for Permanent Disability. In the event Employee’s employment is terminated by reason of “permanent
disability” (as defined below), the employee shall be entitled to any Restricted Shares that have become non-forfeitable pursuant to Section 3 of this Award Agreement, and any Unvested Shares that would become vested on the November 1
immediately following the date of termination. All remaining unvested shares shall be forfeited. 
  
 (d) Termination for Death. In the event Employee’s employment is terminated by reason of death, the vested Restricted Shares
and any unvested shares that would become vested on the November 1 immediately following the date of termination would become assigned to and the property of Employee’s estate. 
  
 (e) Change in Control. Upon the occurrence of a “Change in control” (as defined below),
employee shall be entitled to all vested Restricted Shares and any Unvested Shares on the effective date of the Change in Control. 
  
 5. Dividend, Voting and Other Rights. Except as otherwise provided herein, Employee shall have all of the rights of a stockholder
with respect to the Restricted Shares, including the right to vote such shares and receive any dividends that may be paid thereon; provided, however, that any additional Common Stock of the Company or other securities that Employee may become
entitled to receive pursuant to a stock dividend, stock split, combination of shares, recapitalization, merger, consolidation, separation, or reorganization or any other change in the capital structure of the Company shall be subject to the same
restrictions as the Restricted Shares. 
  

 6. Retention of Stock Certificate(s) by the Company. The certificate(s)
representing the Restricted Shares shall be held in custody by the Company, together with a stock power endorsed in blank by Employee with respect thereto, until those shares have become nonforfeitable in accordance with Section 3 of this Award
Agreement. In order for the grant under this Award Agreement to be effective, Employee must sign and return the attached stock powers to the attention of the Company’s Chief Financial Officer. 
  
 7. No Employment Contract. Nothing contained in this
Award Agreement shall confer upon Employee any right with respect to his continuance of employment by the Company, nor limit or affect in any manner the right of the Company to terminate the employment or adjust the compensation of Employee.

  
 8. Taxes and Withholding. The Company
shall be responsible for reimbursement to Employee for payment of any Federal, state, local or foreign taxes in connection with the issuance or vesting of any restricted or nonrestricted shares of Common Stock or other securities pursuant to this
Award Agreement. 
  
 9. Severability. In
the event that one or more of the provisions of this Award Agreement shall be invalidated for any reason by a court of competent jurisdiction, any provision so invalidated shall be deemed to be separable from the other provisions hereof, and the
remaining provisions hereof shall continue to be valid and fully enforceable. 
  
 10. Conflict with Plan. This Award Agreement is subject to all terms, conditions, limitation and restrictions contained in the Plan, which shall be controlling in the event of any conflicting or inconsistent
provisions. 
  
 11. Governing Law. The
interpretation, performance, and enforcement of this Award Agreement shall be governed by the laws of the State of Delaware. 
  
 12. Other. For purposes of this agreement, the terms “Permanent Disability”, “Cause”, “Good Reason”
and “Change in Control” shall have the same meanings ascribed to them in the Employee’s employee agreement with the Company dated February 28, 1999 as amended from time to time. 
  
 [SIGNATURE PAGE TO FOLLOW] 
  

 IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first written above.

  

			
	JPS INDUSTRIES, INC.
		
	By:	 	 /s/ Charles R. Tutterow

	 	 	

	 Name:
	 	 Charles R. Tutterow

	 Title:
	 	Executive Vice President and Chief Financial Officer

  

	
	Accepted:
	
	 /s/ Michael L. Fulbright

	

	 Michael L. Fulbright

  

 STOCK POWER 
  
 FOR VALUE RECEIVED,
                             hereby sells, assigns and transfers unto
                            , effective as of
                ,
                                
(            ) shares of the Common Stock, par value $.01 per share, of JPS Industries, Inc. (the “Company”) standing in its name on the books of the Company and
represented by Certificate No.             , and does hereby irrevocably constitute and appoint
                                 attorney to transfer such shares on the books of
the Company, with full power of substitution in the premises. 
  

	
	
	 /s/ Michael L. Fulbright

	

	 Michael L. Fulbright

  

			
		
	Dated:	 	 
	 	 	

	 	 	 

  
 Medallion Guaranteed:

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