Document:

FLORIDIAN FINANCIAL GROUP, INC.

        STOCK OPTION PLAN

        ARTICLE 1

         

        GENERAL PROVISIONS

        
            	
                        1.1

                    	
                        Purpose.

                    

        

        This 2009 Stock Option Plan (the “Plan”) of FLORIDIAN FINANCIAL GROUP, INC. (the “Company”) is effective as of the 20th day of June 2009 (“Effective Date”) for the following purposes: (1) to closely associate the interests of certain Key Persons (as
        hereinafter defined) with the interests of the Company; (2) to encourage the Key Persons to focus on the growth and development of the Company, as reflected in increased shareholder value; (3) to maintain competitive compensation levels; and (4) to provide an incentive for the Key Persons to maintain association or employment with the Company so that the Company may retain the services of the most highly qualified individuals in high level capacities.

        
            	
                        1.2

                    	
                        Administration.

                    

        

        (a)       The Plan shall be administered by the Compensation Committee of the Company (the “Committee”) as that term is defined in and as constituted from time to time in accordance with the Bylaws of the Company. 

        (b)       The Committee shall have the authority, in its sole discretion and from time to time to:

        (i)        grant awards to such employees, officers and directors of the Company and its subsidiaries as the Committee shall select;

        (ii)       make all determinations necessary or desirable for the administration of the Plan including, within any applicable limits specifically set out in the Plan;

        (iii)      impose such limitations, restrictions and conditions upon any such award as the Committee shall determine;

        (iv)      interpret the Plan, adopt, amend, and rescind rules and regulations relating to the Plan, and

        (v)       make all other determinations and take all other actions necessary or advisable for the implementation and administration of the Plan.

        (c)       The Committee may select one of its members as its chair, and shall hold meetings at such times and places as it may determine. Acts by a majority of the Committee, or acts reduced to or approved in writing by a majority of the members, shall be the valid acts of the Committee.

        

        

        

        (d)       The Committee’s interpretation of the Plan or any Awards granted pursuant thereto and all decisions and determinations by the Committee with respect to the Plan shall be final, binding, and conclusive on all parties unless otherwise determined by the Committee. 

        
            	
                        1.3

                    	
                        Eligibility for Participation.

                    

        

        Only Key Persons shall be eligible for participation in the Plan. Key Persons shall be selected by the Committee for grants of Awards under this Plan.

        
            	
                        1.4

                    	
                        Types of Awards Under Plan.

                    

        

        Awards that are available under the Plan shall be as follows:

        
            	
                         

                    	
                        (a)

                    	
                        Nonqualified Stock Options (as described in Article 3);

                    
	
                         

                    	
                        (b)

                    	
                        Restricted Stock Grants (as described in Article 4);

                    
	
                         

                    	
                        (c)

                    	
                        Phantom Stock Unit Awards (as described in Article 5);

                    
	
                         

                    	
                        (d)

                    	
                        Stock Appreciation Rights (as described in Article 6); or

                    
	
                         

                    	
                        (e)

                    	
                        Any combination of the foregoing Awards.

                    

        

        
            	
                        1.5

                    	
                        Aggregate Limitation on Awards.

                    

        

        (a)       Shares of Stock which may be issued under the Plan shall be authorized and unissued or treasury shares of the Common Stock of the Company. The shares of Common Stock which may be issued under the Plan shall not, at any time, exceed five percent (5%)of the issued and outstanding
        Common Stock; provided however, that if there shall be a prospective reduction in the outstanding Common Stock, any previously issued Awards shall remain valid and exercisable in Common Stock notwithstanding that Common Stock subsequently issued pursuant to the prior Awards may exceed such limit.

        (b)       For purposes of calculating the maximum number of shares of Common Stock which may be issued under the Plan, the following shall apply:

        (i)        All the shares issued shall be counted when cash is used as full payment for the shares issued for any Award; and

        (ii)       Only the net shares issued (including the shares, if any, sold for withholding tax requirements as provided herein) shall be counted when shares of Common Stock are used as full or partial payment for the shares issued for any Award.

        (c)       Shares tendered by a Participant as payment for shares issued upon exercise of any Award shall be available for issuance under the Plan. If any Award granted under the Plan terminates for any reason without being wholly exercised, then the Committee shall have the discretion to grant new Awards to Participants covering the number of shares
        of Common Stock 

         

        
            

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        to which such Awards related. Any shares of Common Stock issued pursuant to an Award which are subsequently reacquired by the Company shall again be available for issuance under the Plan.

        
            	
                        1.6

                    	
                        Term of Plan.

                    

        

        The Plan shall continue in effect from the Effective Date until the day before the tenth anniversary of the Effective Date (the “Termination Date”); provided, however, that the Plan and all Awards made under the Plan prior to such date shall remain in effect until such Awards have been satisfied or terminated in accordance with the Plan and the terms of such Awards. Awards
        granted prior to the Termination Date shall remain in effect until the exercise, surrender, cancellation or expiration in accordance with their terms and the terms of the Plan.

        ARTICLE 2

         

        DEFINITIONS

        The following definitions shall be applicable throughout the Plan.

        2.1       “Appreciation Date” shall mean the date designated by a Holder of Stock Appreciation Rights for measurement of the appreciation in the value of rights awarded to him or her, which date shall be the date notice of such designation is received by the Committee, or its designee.

        2.2       “Award” shall mean, individually or collectively, any Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock Award or Phantom Stock Unit Award granted to a Participant pursuant to the terms of the Plan.

        2.3       “Board” or “Board of Directors” shall mean the Board of Directors of the Company.

        2.4       “Change in Control” shall, unless the Committee otherwise directs by resolution adopted prior thereto, be deemed to occur if (i) any “person” (as that term is used in Sections 13 and 14(d)(2) of the Exchange Act (as defined herein) is or becomes the beneficial owner (as that term is
        used in Section 13(d) of the Exchange Act), directly or indirectly, of fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (“Voting Stock”); or (ii) during any period of twelve months, individuals who at the beginning of such period constitute the Board cease for any reason to constitute at least a majority thereof, unless the election or the nomination for
        election by the Company’s shareholders of each new Director was approved by a vote of at least three-quarters (3/4) of the Directors then still in office who were Directors at the beginning of the period.

        2.5       “Code” shall mean the Internal Revenue Code of 1986, as amended. Reference in the Plan to any section of the Code shall be deemed to include any amendments or successor provisions to such section and any regulations under such section.

        2.6       “Committee” shall have the meaning set forth in Section 1.2(a) of the Plan.

        2.7       “Common Stock” shall mean the Common Stock of the Company, ___________ ($______) par value per share.

         

        
            

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        2.8       “Company” shall mean FLORIDIAN FINANCIAL GROUP, INC. and its successors.

        2.9       “Director” shall mean a member of the Board of Directors.

        2.10     “Disability” shall mean any of the following: (a) the Participant’s inability to perform each of the essential duties of such Participant’s position by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a
        continuous period of not less than twelve (12) months or (b) the incurrence by the Participant of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months. 

        2.11       “Dividend Equivalents” shall have the meaning set forth in Section 5.3.

        2.12      “Employee” shall mean a statutory employee of the Company as defined in Code Section 1402(d).

        2.13       “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

        2.14       “Fair Market Value” shall have the following meaning:

        
            	
                         

                    	
                        (a)

                    	
                        Company’s Common Stock is Publicly Traded.

                    

        

        For purposes of the Plan, if the Company’s Common Stock is publicly traded at the time of determination, “Fair Market Value” as of any date and in respect of any share of Common Stock shall mean:

        (i)        the mean of the high and low prices of the Common Stock on the principal national securities exchange on which the Common Stock is traded, or if no sales of Common Stock occur on the date in question, on the last preceding date on which there was a sale on such market, if the Common Stock is then traded on a
        national securities exchange; or

        (ii)       the mean between the closing bid and ask prices last quoted by an established quotation service for over-the-counter securities, or if no sales of Common Stock occur on the date in question, on the last preceding date on which there was a sale on such market, if the Common Stock is not reported on a national securities
        exchange.

        The above definition shall be interpreted consistent with Treas. Reg. §1.409A-1(b)(5)(iv)(A).

        
            	
                         

                    	
                        (b)

                    	
                        Company’s Common Stock is Not Publicly Traded.

                    

        

        For purposes of the Plan, if the Company’s Common Stock is not publicly traded at the time of determination, “Fair Market Value” as of any date and in respect of any share of Common Stock shall be deemed to be the fair value of the Common Stock as determined by the Committee after taking into consideration all factors which it deems appropriate, including, without limitation,
        

         

        
            

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        recent sale and offer prices of the Common Stock in private transactions negotiated at arm’s length and taking into account the factors listed in Treas. Reg. §1.409A-1(b)(5)(iv)(B).

        2.15       “Holder” shall mean a Participant who has been granted a Nonqualified Stock Option.

        2.16     “Initial Public Offering” means the first public offering of the Company’s equity securities registered under the Securities Act of 1933, as amended, or any successor statute or such other event as a result of which outstanding equity securities of the Company (or any successor entity) shall be publicly
        traded.

        2.17     “Key Persons” shall mean any Employee, officer, Director or consultant of the Company whether or not such individual is considered an Employee of the Company.

        2.18     “Nonqualified Stock Option” shall mean an Option granted by the Committee to a Participant under the Plan as described in Article 3.

        2.19       “Nonqualified Stock Option Period” shall mean the period described in Section 3.5(a).

        2.20       “Option” shall mean a Nonqualified Stock Option.

        2.21       “Optionee” shall mean a Participant who has been granted an Option hereunder.

        2.22       “Option Period” shall mean a Nonqualified Stock Option Period.

        2.23       “Option Price” shall mean the applicable Stock Option Price.

        2.24       “Participant” shall mean a Key Person who shall be granted an Award under the Plan.

        2.25     “Phantom Stock Unit” shall mean a hypothetical investment equivalent equal to one Share of Stock granted in connection with an Award made under Article 5 of the Plan. 

        2.26     “Plan” shall mean this 2009 Stock Option Plan of the Company, as amended from time to time.

        2.27     “Restricted Period” shall mean, with respect to any share of Restricted Stock, the period of time determined by the Committee during which such share of Restricted Stock is subject to the restrictions set forth in Article 4, and with respect to any
        Phantom Stock Unit, the period of time determined by the Committee during which such Phantom Stock Unit is subject to the restrictions set forth in Article 5.

        2.28     “Restricted Stock” shall mean shares of Common Stock issued or transferred to a Participant subject to the restrictions set forth in Article4 and any new, additional or different securities a Participant may become entitled
        to receive as a result of adjustments made pursuant to Section 7.16.

        2.29       “Restricted Stock Award” shall mean an Award granted under Article 4 of the Plan.

        2.30      “Stock” shall mean the Common Stock or such other authorized shares of stock of the Company as the Board may from time to time authorize for use under the Plan.

         

        
            

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        2.31     “Stock Appreciation Right” or “SAR” shall mean an Award granted under Article 6 of the Plan.

        2.32       “Vested Unit” shall have the meaning set forth in Section 5.6.

         

        ARTICLE 3

         

        NONQUALIFIED STOCK OPTIONS

        
            	
                        3.1

                    	
                        Award of Nonqualified Stock Options.

                    

        

        The Committee may from time to time, and subject to the provisions of the Plan and such other terms and conditions as the Committee may prescribe, grant to any Key Person one or more Options to purchase for cash or shares, the number of shares of Common Stock (“Nonqualified Stock Options”) allotted by the Committee. The
        date a Nonqualified Stock Option is granted shall mean the date selected by the Committee as of which the Committee shall allot a specific number of shares to a Participant pursuant to the Plan and when the Participant has a legally binding right constituting the Nonqualified Stock Option; provided that the grant date may not be a date that occurs prior to the date the Committee takes action to approve the Nonqualified Stock Option.

        
            	
                        3.2

                    	
                        Nonqualified Stock Option Agreements.

                    

        

        Each Nonqualified Stock Option granted under the Plan shall be evidenced by a “Nonqualified Stock Option Agreement” between the Company and the Holder of the Nonqualified Stock Option containing such provisions as may be determined by the Committee, but shall be subject to the following terms and conditions.

        (a)       Each Nonqualified Stock Option or portion thereof that is exercisable shall be exercisable for the full amount or for any part thereof, except as otherwise determined by the terms of the Nonqualified Stock Option Agreement.

        (b)       Each share of Common Stock purchased through the exercise of a Nonqualified Stock Option shall be paid for in full at the time of the exercise. Each Nonqualified Stock Option shall cease to be exercisable as to any share of Common Stock, at the earlier of: (i) the time the Holder purchases the share; (ii) the time the Holder exercises a
        related SAR or (iii) when the Nonqualified Stock Option lapses.

        (c)       Nonqualified Stock Options shall not be assignable or transferable by the Holder except by (i) will or the laws of descent and distribution, or (ii) a domestic relations order, and shall be exercisable during the Holder’s lifetime only by him or her or his or her guardian or legal representative.

        (d)       Each Nonqualified Stock Option shall become exercisable by the Holder in accordance with the vesting schedule (if any) established by the Committee for the Award.

         

        
            

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        (e)       Each Nonqualified Stock Option Agreement may contain an agreement that, upon demand by the Committee for such a representation, the Holder shall deliver to the Committee at the time of any exercise of a Nonqualified Stock Option a written representation that the shares to be acquired upon such exercise are to be acquired for investment and
        not for resale or with a view to the distribution thereof. Upon such demand, delivery of such representation prior to the delivery of any shares issued upon exercise of a Nonqualified Stock Option shall be a condition precedent to the right of the Holder or such other person to purchase any shares. In the event certificates for Common Stock are delivered under the Plan with respect to which such investment representation has been obtained, the Committee may cause a legend or legends to
        be placed on such certificates to make appropriate reference to such representation and to restrict transfer in the absence of compliance with applicable federal or state securities laws.

        
            	
                        3.3

                    	
                        Nonqualified Stock Option Price.

                    

        

        The exercise price per share of Common Stock (the “Nonqualified Stock Option Price”) shall be set by the Committee at the time of grant subject to the following: (i) the Nonqualified Stock Option Price shall never be less than the Fair Market Value of the underlying stock on the date the Nonqualified Stock Option is
        granted; (ii) the number of shares subject to the Nonqualified Stock Option Price must be fixed on the original date of grant; and (iii) the Nonqualified Stock Option Price may not include any additional feature for the deferral of compensation.

        
            	
                        3.4

                    	
                        Manner of Exercise and Form of Payment.

                    

        

        (a)       Nonqualified Stock Options which have become exercisable may be exercised by delivery of written notice of exercise (“Notice of Exercise”) to the Committee accompanied by payment of the Nonqualified Stock Option Price. The Nonqualified Stock Option Price shall be payable in cash or such other means as set forth in the
        Nonqualified Stock Option Agreement plus the amount (if any) of federal and/or other taxes which the Company may, in its judgment, be required to withhold with respect to an Award. If a Participant shall fail to pay the Nonqualified Stock Option Price at the time of exercise, the Nonqualified Stock Option(s) which are being exercised shall become null and void.

        (b)       Notwithstanding Section 3.4(a), at the time the Notice of Exercise pertaining to the Nonqualified Stock Option is given to the Committee with respect to the exercise of any Nonqualified Stock Option, if the Company’s shares of Common Stock are traded on a national securities
        exchange, a Participant may elect in writing to pay the Nonqualified Stock Option Price through a “cashless” feature. Upon such election, the Committee shall sell a sufficient number of shares of Common Stock on behalf of the electing Participant which would otherwise be a part of the shares exercised through the Nonqualified Stock Option in the Notice of Exercise. The sale price shall be the closing price of the shares as quoted on the exchange or market as of the trading
        day immediately preceding the date of the Notice of Exercise. The proceeds from such sale(s) shall be used to pay any and all applicable state and federal withholding or other employment or payroll taxes, if any, applicable to the taxable income of the Participant resulting from such exercise together with any sales, transfer or similar taxes imposed with respect to the issuance or transfer of shares of Common Stock in connection with such 

         

        
            

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        exercise. The exercising Participant shall then receive the balance of the shares net of those sold in order for the Company to pay such taxes.

        (c)       Any state or federal withholding taxes attributable to the portion of the Non Qualified Stock Option payable in cash shall be withheld from the cash that would otherwise be paid to the Participant hereunder.

        
            	
                        3.5

                    	
                        Nonqualified Stock Option Period; Termination.

                    

        

        (a)       Each Nonqualified Stock Option shall be exercisable by the Holder in accordance with such terms as shall be established by the Committee for the Nonqualified Stock Option, and unless a shorter period is provided by the Committee or by another section of the Plan, may be exercised during a period of ten (10) years from the date of grant
        thereof (the “Nonqualified Stock Option Period”). No Nonqualified Stock Option shall be exercisable after the expiration of its Nonqualified Stock Option Period.

        (b)       If the Holder dies within the Nonqualified Stock Option Period (or such other period as may have been established by the Committee), any rights to the extent exercisable on the date of death may be exercised by the Holder’s estate, or by a person who acquires the right to exercise such Nonqualified Stock Option by bequest or
        inheritance or by reason of the death of the Holder, provided that such exercise occurs within both the Nonqualified Stock Option Period and twelve (12) months after the Holder’s death.

        (c)       If the Holder’s relationship with the Company terminates by reason of Disability within the Nonqualified Stock Option Period, the Holder may, within twelve (12) months from the date of termination (or within such other period as determined by the Committee), exercise any Nonqualified Stock Options to the extent such options are
        exercisable during such twelve (12) month period.

        (d)       If the Holder’s relationship with the Company terminates for any reason other than death or Disability, all unvested Nonqualified Stock Options shall, except as set forth in the Holder’s Nonqualified Stock Option Agreement or as otherwise determined by the Committee at the time of the grant, terminate at the time of the
        termination of such relationship or employment, as the case may be.

        
            	
                        3.6

                    	
                        Effect of Exercise.

                    

        

        As soon as practicable after receipt of payment, the Company shall deliver to the Participant a certificate or certificates for such shares of Common Stock. The Participant shall become a shareholder of the Company with respect to Common Stock represented by share certificates so issued and as such shall be fully entitled to receive dividends, to vote and to exercise all other rights
        of a shareholder.

        
            	
                        3.7

                    	
                        Order of Exercise.

                    

        

        Options granted under the Plan may be exercised in any order, regardless of the date of the grant or the existence of any other outstanding Nonqualified Stock Option awarded to the Participant.

         

        
            

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        ARTICLE 4

         

        RESTRICTED STOCK

        
            	
                        4.1

                    	
                        Grant of Restricted Stock.

                    

        

        The Committee may, from time to time and subject to the provisions of the Plan and such other terms and conditions as the Committee may prescribe, grant Restricted Stock to any Key Person.

        
            	
                        4.2

                    	
                        Restricted Stock Agreement.

                    

        

        (a)       The grant or sale of Restricted Stock shall be evidenced by a “Restricted Stock Agreement” between the Company and Participant who is the recipient or purchaser of the Restricted Stock, including such terms as the time or times at which the Restricted Stock shall be granted or
        become vested, the number of shares of Common Stock subject to each Restricted Stock Award or sale, the period of time, if any, during which all of or a portion of such shares shall be subject to vesting, forfeiture and such other terms and conditions of such Restricted Stock Grant, if any, the Committee may from time to time determine. In addition to the Restricted Stock Agreement, the Holder of a Restricted Stock Award shall execute and deliver to the Secretary of the Company an
        escrow agreement satisfactory to the Committee and the appropriate blank stock powers with respect to the Restricted Stock covered by such agreements and shall pay to the Company as the purchase price of the shares of Common Stock subject to such Award, the aggregate par value of such shares of Common Stock within sixty (60) days following the making of such Award which purchase price shall be deemed to have been paid by the Participant by services previously rendered to the Company. If
        a Participant shall fail to execute the Restricted Stock Agreement, escrow agreement and stock powers, the Award shall be null and void.

        (b)       Subject to the restrictions set forth in Section 4.4, the Holder shall generally have the rights and privileges of a shareholder as to such Restricted Stock, including the right to vote such Restricted Stock and the right to receive all dividends and other distributions of the
        Company with respect to such Restricted Stock. Notwithstanding the foregoing, at the discretion of the Committee, cash and stock dividends with respect to the Restricted Stock may be either currently paid or withheld by the Company for the Holder’s account, and interest may be paid on the amount of cash dividends withheld at a rate and subject to such terms as determined by the Committee. Cash or stock dividends so withheld by the Committee shall not be subject to
        forfeiture.

         

        
            	
                        4.3

                    	
                        Escrow Stock Certificates.

                    

        

        Upon satisfaction of the requirements set forth in Section 4.2, the Committee shall then cause stock certificates registered in the name of the Holder to be issued and deposited together with the stock powers with an escrow agent to be designated by the Committee. The Committee 

         

        
            

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        shall cause the escrow agent to issue to the Holder a receipt evidencing any stock certificate held by it registered in the name of the Holder.

        
            	
                        4.4

                    	
                        Restrictions.

                    

        

        (a)       Restricted Stock awarded to a Participant shall be subject to the following restrictions until the expiration of the Restricted Period: (i) the Holder shall not be entitled to delivery of the stock certificate; (ii) the shares shall be subject to the restrictions on transferability set forth in the grant; and (iii) the shares shall be
        subject to forfeiture to the extent provided in the Restricted Stock Agreement and, to the extent such shares are forfeited, the stock certificates shall be returned to the Company, and all rights of the Holder to such shares and as a shareholder shall terminate without further obligation on the part of the Company.

        (b)       The Committee shall have the authority to remove any or all of the restrictions on the Restricted Stock whenever it may determine that, by reason of changes in applicable laws or other changes in circumstances arising after the date of the Restricted Stock Award, such action is appropriate.

        
            	
                        4.5

                    	
                        Restricted Period.

                    

        

        The “Restricted Period” of Restricted Stock shall commence on the date of the Award and shall expire from time to time as to that part of the Restricted Stock indicated in the Restricted Stock Agreement or otherwise set forth on a schedule established by the Committee with respect to the Award.

        
            	
                        4.6

                    	
                        Payment of Taxes: Delivery of Restricted Stock.

                    

        

        (a)       Upon the expiration of the Restricted Period with respect to any shares of Common Stock covered by a Restricted Stock Award, and upon payment to the Committee of cash sufficient for the Company to pay all applicable payroll, employment, etc., taxes attributable to the Restricted Stock in the same manner as in
        Section 3.4 hereof, a stock certificate evidencing the shares of Restricted Stock which have not then been forfeited and with respect to which the Restricted Period has expired (to the nearest full share) shall be delivered without charge to the Holder, or his estate, free of all restrictions under the Plan.

        (b)       Notwithstanding the foregoing, upon expiration of the Restricted Period, if a Participant shall not pay the taxes attributable to the exercise of the Restricted Period as set forth in Subsection (a), above, the Committee shall thereupon sell without further direction by the Participant a sufficient number of shares of the Restricted Stock
        in accordance with reasonably uniform procedures adopted by the Committee in order to pay such employment, payroll, etc., taxes attributable thereto in the same manner as a “cashless” exercise in Section 3.4(b). The balance of the Restricted Stock shares remaining subsequent to such sale together with any cash from a sale of a fractional sale shall thereupon be distributed to the Participant. 

        (c)       Any state or federal withholding taxes attributable to the portion of the Restricted Stock payable in cash shall be withheld from the cash that would otherwise be paid to the Participant hereunder.

         

        
            

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                        4.7

                    	
                        Payment for Restricted Stock.

                    

        

        Except as provided in Sections 4.2 and 4.6, a Participant shall not be required to make any payment for Common Stock received pursuant to a Restricted Stock Award.

        ARTICLE 5

         

        PHANTOM STOCK UNITS

        
            	
                        5.1

                    	
                        Grant of Phantom Stock Units.

                    

        

        Subject to the limitations of this Plan, the Committee shall have the authority to (a) grant Phantom Stock Unit Awards to Key Persons, and (b) to establish terms, conditions and restrictions applicable to such Phantom Stock Units, including the Restricted Period, and the time or times at which the Phantom Stock Units shall be granted or become vested and the number of Phantom Stock
        Units to be covered by each grant.

        
            	
                        5.2

                    	
                        Phantom Stock Unit Agreement.

                    

        

        The grant of Phantom Stock Units shall be evidenced by a “Phantom Stock Unit Agreement” between the Company and the Participant who is a recipient of the Phantom Stock Units, including such terms as the Committee may from time to time determine.

        
            	
                        5.3

                    	
                        No Stock Issuance.

                    

        

        In the case of a Phantom Stock Unit Award, no shares of Common Stock shall be issued at the time the Award is made, and the Company will not be required to set aside a fund for the payment of any such Award. The Committee shall, in its sole discretion, determine whether to credit to the account of, or to currently pay to, each recipient of an Award of Phantom Stock Units an amount
        equal to the cash dividends paid by the Company upon one share of Common Stock for each Phantom Stock Unit then credited to such Participant’s account (“Dividend Equivalents”). Dividend Equivalents credited to a Holder’s account shall be subject to forfeiture and may bear interest at a rate and subject to such terms as determined by the Committee.

        
            	
                        5.4

                    	
                        Restrictions.

                    

        

        (a)       Phantom Stock Units awarded to any Participant shall be subject to the following restrictions until the expiration of the Restricted Period: (i) the Phantom Stock shall be subject to forfeiture to the extent provided in the Phantom Stock Unit Agreement and, to the extent such units are forfeited, all rights of the Participant to such units
        shall terminate without further obligation on the part of the Company, and (ii) any other restrictions which the Committee may determine in advance are necessary or appropriate.

        (b)       The Committee shall have the authority to remove any or all of the restrictions on the Phantom Stock Units whenever it may determine that, by reason of changes in applicable laws or other changes in circumstances arising after the date of the Phantom Stock Award, such action is appropriate.

         

        
            

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                        5.5

                    	
                        Restricted Period.

                    

        

        The Restricted Period of Phantom Stock Units shall commence on the date of the grant and shall expire from time to time as to that part of the Phantom Stock Units indicated in the Phantom Stock Unit Agreement or otherwise set forth in a schedule established by the Committee with respect to the Award.

        
            	
                        5.6

                    	
                        Settlement of Phantom Stock Units.

                    

        

        Upon the expiration of the Restricted Period with respect to any Phantom Stock Units covered by a Phantom Stock Unit Award, the Company shall deliver to the Holder or his estate without any charge one share of Common Stock for each Phantom Stock Unit which has not then been forfeited and with respect to which the Restricted Period has expired (“Vested
        Unit”) and cash equal to any Dividend Equivalents credited with respect to each such Vested Unit and the interest thereon, if any; provided, however, that the Committee may, in its sole discretion, elect to pay cash or part cash and part Common Stock in lieu of delivering only Common Stock for Vested Units. If cash payment is made in lieu of delivering Common Stock, the amount of such payment shall be equal to the Fair Market Value for the date on which
        the Restricted Period lapsed with respect to such Vested Unit.

        
            	
                        5.7

                    	
                        Payment of Taxes.

                    

        

        (a)       Upon the distribution of any shares of Common Stock in kind to the Participant as set forth in Section 5.6, any and all taxes attributable to the Common Stock being distributed hereunder shall be paid by the Participant to the Committee determined and paid in the same manner as in
        Section 3.4 hereof prior to delivery of the Common Stock to the Participant or his or her estate.

        (b)       Notwithstanding the foregoing, upon expiration of the Restricted Period, if a Participant shall not pay the taxes attributable to distribution of Common Stock as set forth in Subsection (a) above, the Committee shall thereupon sell without further direction by the Participant a sufficient number of shares of the Restricted Stock in
        accordance with reasonably uniform procedures adopted by the Committee in order to pay such employment, payroll, etc., taxes attributable thereto in the same manner as a “cashless” exercise in Section 3.4(b). The balance of the Common Stock shares remaining shall thereupon be distributed to the Participant. Notwithstanding anything herein to the contrary, the satisfaction of all tax obligations attributable to a
        Phantom stock grant are a condition precedent to the distribution of Common Stock hereunder.

        (c)       Any state or federal withholding taxes attributable to the portion of the Phantom Stock Unit payable in cash shall be withheld from the cash that would otherwise be paid to the Participant hereunder.

         

        ARTICLE 6

         

        STOCK APPRECIATION RIGHTS

         

        
            

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                        6.1

                    	
                        Stock Appreciation Rights.

                    

        

        Any Option granted under the Plan to Key Persons may include a Stock Appreciation Right or SAR, granted either at the time of the Option Grant or by amendment.  The Committee may also award SARs to Key Persons independently of any Option.  A SAR shall be subject to such terms and conditions not inconsistent with the Plan as the Committee shall impose, including,
        but not limited to, the terms set forth in this Article 6.

        6.2          SAR Exercise Price. The exercise price per share of the SAR shall be set by the Committee at the time of grant subject to the following: (i) the SAR exercise price shall never be less than the Fair Market Value of the underlying stock on the date the SAR is granted; (ii) the number of shares
        subject to the SAR must be fixed on the original date of grant; and (iii) the SAR may not include any additional feature for the deferral of compensation.

        
            	
                        6.3

                    	
                        Vesting.

                    

        

        A SAR granted in connection with an Option shall become exercisable, be transferable and shall lapse according to the same vesting schedule, transferability and lapse rules that are established by the Committee for the Option. A SAR granted independent of an Option shall become exercisable, be transferable and shall lapse in accordance with a vesting schedule, transferability and
        lapse rules established by the Committee.

        
            	
                        6.4

                    	
                        Failure to Exercise.

                    

        

        If on the last day of an Option Period (or in the case of a SAR independent of an Option, the SAR period established by the Committee), the Fair Market Value of the Common Stock exceeds the Option Price or SAR Exercise Price, as the case may be, the Holder has not exercised the Option or the SAR, and neither the Option nor the SAR has lapsed, such SAR shall be deemed to have been
        exercised by the Holder on such last day, and the Company shall make the appropriate payment therefor.

        
            	
                        6.5

                    	
                        Payment.

                    

        

        The amount of additional compensation which may be received pursuant to the award of one (1) SAR is the excess, if any, of the Fair Market Value of one share of Common Stock on the Appreciation Date over the Option Price, in the case of a SAR granted in connection with an Option, or the Fair Market Value of one (1) share of Common Stock on the date of the grant, in the case of a SAR
        granted independent of an Option. The Company shall pay such excess in cash, in shares of Common Stock valued at Fair Market Value, or any combination thereof, as determined by the Committee. Fractional shares shall be settled in cash.

         

        
            	
                        6.6

                    	
                        Designation of Appreciation Date.

                    

        

         

        
            

            13

             

        

         

        

        

        

        A Participant may designate an Appreciation Date at such time or times as may be determined by the Committee at the time of grant by filing an irrevocable written notice with the Committee or its designee, specifying the number of SARs to which the Appreciation Date relates, and the date on which such SARs were awarded. Such time or times determined by the Committee may take into
        account any applicable “window periods” required by Rule 16b-3 under the Exchange Act.

        
            	
                        6.7

                    	
                        Expiration.

                    

        

        Except as otherwise provided in the case of SARs granted in connection with Options, the SARs shall expire on a date designated by the Committee which is not later than ten (10) years after the date on which the SAR was awarded (“Expiration Date”).

        
            	
                        6.8

                    	
                        Payment of Taxes.

                    

        

        (a)       Upon the distribution of any shares of Common Stock in kind to the Participant attributable to the exercise of a SAR, any and all taxes attributable to the Common Stock being distributed hereunder shall be paid by the Participant to the Committee determined and paid in the same manner as in Section
        3.4 hereof prior to delivery of the Common Stock to the Participant or his or her estate.

        (b)       Notwithstanding the foregoing, upon an Expiration Date, if a Participant shall not pay the taxes attributable to the distribution of Common Stock as set forth in Subsection (a) above, the Committee shall thereupon sell without further direction by the Participant a sufficient number of shares of the Common Stock in accordance with
        reasonably uniform procedures adopted by the Committee in order to pay such employment, payroll, etc., taxes attributable thereto in the same manner as a “cashless” exercise in Section 3.4(b). The balance of the Common Stock shares remaining shall thereupon be distributed to the Participant.

        (c)       Any state or federal withholding taxes attributable to the portion of the SAR payable in cash shall be withheld from the cash that would otherwise be paid to the Participant hereunder.

        ARTICLE 7

         

        MISCELLANEOUS

        
            	
                        7.1

                    	
                        General Restriction.

                    

        

        Each Award under the Plan shall be subject to the requirement that, if at any time the Committee shall determine that (a) the listing, registration or qualification of the shares of Common Stock subject or related thereto upon any securities exchange or under any state or Federal law, or (b) the consent or approval of any government regulatory body, or (c) an agreement by the grantee
        of an award with respect to the disposition of shares of Common Stock, is necessary or desirable as a condition of, or in connection with, the granting of such Award or the issue or purchase of shares of Common Stock thereunder, such Award may not be consummated in whole or in part unless such listing, registration, qualification, consent, approval 

         

        
            

            14

             

        

         

        

        

        

        or agreement shall have been effected or obtained free of any conditions not acceptable to the Committee.

        
            	
                        7.2

                    	
                        Additional Provisions of an Award.

                    

        

        The award of any benefit under the Plan may also be subject to such other provisions (whether or not applicable to the benefit awarded to any other Participant) as the Committee determines appropriate, including, without limitation, provisions to assist the Participant in financing the purchase of Common Stock through the exercise of Options, provisions for the forfeiture of or
        restrictions on resale or other disposition of shares acquired under any form of benefit, provisions giving the Company the right to repurchase shares acquired under any form of benefit in the event the Participant elects to dispose of such shares, and provisions to comply with Federal and state securities laws and Federal and state income tax withholding requirements.

        
            	
                        7.3

                    	
                        Restrictions on Transferability.

                    

        

        No Award under the Plan shall be assignable or transferable by the recipient thereof, except by will or by the laws of descent and distribution. During the life of the recipient, such Award shall be exercisable only by such person or by such person’s guardian or legal representative. No right or benefit under this Plan shall be subject to anticipation, alienation, sale,
        assignment, pledge, encumbrance or charge and any attempt to anticipate, alienate, sell, assign, pledge, encumber or charge the same shall be void. No right or benefit hereunder shall in any manner be liable for or subject to any debts, contracts, liabilities or torts of the person entitled to such benefits. If any Participant or beneficiary hereunder shall become bankrupt or attempt to anticipate, alienate, assign, pledge, sell, encumber or charge any right or benefit hereunder, then
        such right or benefit shall in the discretion of the Committee cease. Such Units shall thereupon become null and void.

        
            	
                        7.4

                    	
                        Withholding Taxes.

                    

        

        Notwithstanding any other provision of the Plan, the Company shall have the right in general and in addition to any other specific procedure for the payment of taxes attributable to any Award to deduct from all Awards, to the extent paid in cash, all federal, state or local taxes as required by law to be withheld with respect to such Awards and, in the case of Awards paid in Common
        Stock, the Holder or other person receiving such Common Stock may be required to pay to the Company prior to delivery of such stock, the amount of any such taxes which the Company is required to withhold, if any, with respect to such Common Stock. Subject in particular cases to the approval of the Committee, the Company may accept shares of Common Stock of equivalent Fair Market Value in payment of such withholding tax obligations if the Holder of the Award elects to make payment in
        such manner at least six (6) months prior to the date such tax obligation is determined.

         

        
            	
                        7.5

                    	
                        Compliance with Section 409A of the Code.

                    

        

         

        
            

            15

             

        

         

        

        

        

        The Plan is intended to comply with Section 409A of the Code and shall be construed and interpreted in accordance with such intent. Grants under this Plan shall be treated in a manner that will comply with Section 409A of the Code, including proposed, temporary or final regulations or any other guidance issued by the Secretary of Treasury and the Internal Revenue Service with respect
        thereto (the “Guidance”). Any provision of the Plan that would cause a grant or any other payment under the Plan to fail to satisfy Section 409A of the Code shall have no force and effect until amended to comply with Code Section 409A (which amendment may be retroactive to the extent permitted by the Guidance). If the Committee at any time determines that the Plan or Options granted under the Plan are or may be subject to, and fail or may fail to comply with, the
        requirements of Section 409A of the Code, the Committee may make such modifications to the Plan and to the terms of any awards under the Plan, including without limitation, modifications with respect to the exercisability of Options, as it deems advisable either to ensure that the Plan and Options granted under the Plan comply with any applicable requirements of Section 409A of the Code. Notwithstanding the foregoing, nothing herein shall create any obligation by the Company to any
        participant should any grant or other payment fail to satisfy Section 409A of the Code.

        
            	
                        7.6

                    	
                        Fractional Shares.

                    

        

        The Company shall not be required to issue any fractional Common Stock pursuant to this Plan. The Committee may provide for the elimination of fractional Common Shares or for the settlement of fractional Common Shares for cash.

        
            	
                        7.7

                    	
                        Lock-Up Agreement.

                    

        

        The Company may, in its discretion, require in connection with an Initial Public Offering that a Participant agree that any Option or Award granted not be sold, offered for sale, or otherwise disposed of for a period of time as determined by the Board, provided at least a majority of the Board and officers who hold Options or Common Stock at such time are similarly bound.

        
            	
                        7.8

                    	
                        Employment Not Affected.

                    

        

        Nothing in the Plan or in any agreement entered into pursuant to the Plan shall confer upon any Participant the right to continue to serve on the Committee or Board or in the employment of the Company or affect any right which the Company, or its shareholders, may have to terminate the relationship or employment or service of such Participant.

        
            	
                        7.9

                    	
                        Acceleration Events.

                    

        

        If an event occurs which in the opinion of the Board is likely to lead to a Change in Control of the Company, whether or not such Change in Control actually occurs, the Board may direct the Committee to declare that all Nonqualified Stock Options granted under the Plan shall become immediately vested and that such restrictions applicable to Restricted Stock Grants, Phantom Stock Units
        and SARs as determined by the Board shall be waived, notwithstanding the provisions of the respective agreements regarding exercisability. In addition, to the extent provided in the applicable Stock Option Agreement between the Participant and the Company, 

         

        
            

            16

             

        

         

        

        

        

        the vesting of Options granted hereunder may be accelerated if the Participant’s employment or service to the Company terminates by reason of the Participant’s death or Disability.

        
            	
                        7.10

                    	
                        Payments Upon Death of Participant.

                    

        

        Upon the death of a Participant in the Plan, the Company shall pay the amounts payable with respect to an Award of Phantom Share Units or Restricted Stock, if any, due under the Plan to the Participant’s estate.

        
            	
                        7.11

                    	
                        Payments to Persons Other than Participants.

                    

        

        If the Committee shall find that any person to whom any amount is payable under the Plan is unable to care for his or her affairs because of illness or accident, or is a minor, or has died, then any payment due to such person or his or her estate (unless a prior claim therefor has been made by a duly appointed legal representative), may, if the Committee so directs the Company, be
        paid to his or her spouse, child, relative, an institution maintaining or having custody of such person, or any other person deemed by the Committee to be a proper recipient on behalf of such person otherwise entitled to payment. Any such payment shall be a complete discharge of the liability of the Committee and the Company therefor.

        
            	
                        7.12

                    	
                        Non-Uniform Determinations.

                    

        

        The Committee’s determinations under the Plan (including, without limitation, determinations of the persons to receive Awards, the form, amount and timing of such Awards, the terms and provisions of such Awards and the agreements evidencing same) need not be uniform and may be made by it selectively among persons who receive, or are eligible to receive, Awards under the Plan,
        whether or not such persons are similarly situated.

        
            	
                        7.13

                    	
                        Rights as a Shareholder.

                    

        

        Except as otherwise specifically provided in the Plan, no person shall be entitled to the privileges of stock ownership in respect of shares of Common Stock which are subject to Options or Restricted Stock Awards or Phantom Stock Unit Awards hereunder until such shares have been issued to that person upon exercise of an Option according to its terms or upon sale or grant of those
        shares in accordance with a Restricted Stock Award or Phantom Stock Unit Award.

        
            	
                        7.14

                    	
                        Leaves of Absence.

                    

        

        The Committee shall be entitled to make such rules, regulations and determinations as it deems appropriate under the Plan in respect of any leave of absence taken by the recipient of any award. Without limiting the generality of the foregoing, the Committee shall be entitled to determine (a) whether or not any such leave of absence shall constitute a termination of employment within
        the meaning of the Plan and (b) the impact, if any, of any such leave of absence on awards under the Plan previously made to any recipient who takes such leave of absence.

         

        
            

            17

             

        

         

        

        

        

        
            	
                        7.15

                    	
                        Newly Eligible Participants.

                    

        

        The Committee shall be entitled to make such rules, regulations, determinations and awards as it deems appropriate in respect of any person who becomes eligible to participate in the Plan or any portion thereof after the commencement of an Award or incentive period.

        
            	
                        7.16

                    	
                        Adjustments.

                    

        

        Unless the Committee specifically determines otherwise, Options, SARs, Restricted Stock Awards, Phantom Stock Unit Awards and any agreements evidencing such Awards shall be subject to adjustment or substitution as to the number, price or if applicable, kind of a shares of stock or other consideration subject to such Awards or as otherwise determined by the Committee to be equitable
        (a) in the event of changes in the outstanding Common Stock or in the capital structure of the Company, or of any other corporation whose performance is relevant to the attainment of performance goals hereunder, by reason of stock dividends, stock splits, recapitalizations, reorganizations, mergers, consolidations, combinations, exchanges or other relevant changes in capitalization occurring after the date of the grant of any such Award or (b) in the event of any change in applicable
        laws or any change in circumstances which results in or would result in any substantial dilution or enlargement of the rights granted to, or available for, Participants in the Plan, or which otherwise warrants equitable adjustment because it interferes with the intended operation of the Plan. In addition, unless the Committee specifically determines otherwise, in the event of any such adjustments or substitution, the aggregate number of shares of Common Stock available under the Plan
        shall be appropriately adjusted by the Committee, whose determination shall be conclusive. Any adjustments under this Section shall be made in a manner which does not adversely affect the exemption provided pursuant to Rule 16b-3 under the Exchange Act. The Company shall give each Participant notice of an adjustment hereunder and, upon notice, such adjustment shall be conclusive and binding for all purposes.

        
            	
                        7.17

                    	
                        Effect of Change in Control.

                    

        

        (a)       In the event of a Change in Control and notwithstanding any vesting schedule provided for hereunder or by the Committee with respect to an Award of Options, SARs, Phantom Stock Units or Restricted Stock, such Option or SAR shall become immediately exercisable with respect to one hundred percent (100%) of the shares subject to such Option or
        SAR, and the Restricted Period shall expire immediately with respect to one hundred percent (100%) of the Phantom Stock Units or shares of Restricted Stock subject to Restrictions.

        (b)       The obligations of the Company under the Plan shall be binding upon any successor corporation or organization resulting from the merger, consolidation or other reorganization of the Company, or upon any successor corporation or organization succeeding to substantially all of the assets and business of the Company. The Company agrees that it
        will make appropriate provisions for the preservation of a Participant’s rights under the Plan in any agreement or plan which it may enter into or adopt to effect any such merger, consolidation, reorganization or transfer of assets.

         

         

        
            

            18

             

        

         

        

        

        

        
            	
                        7.18

                    	
                        Funding.

                    

        

        Except as otherwise provided in the Plan, no provision of the Plan shall require the Company, for the purpose of satisfying any obligations under the Plan, to purchase assets or place any assets in a trust or other entity to which contributions are made or otherwise to segregate any assets, nor shall the Company maintain separate bank accounts, books, records, or other evidence of the
        existence of a segregated or separately maintained or administered fund for such purposes. Holders shall have no rights under the Plan other than as unsecured general creditors of the Company, except that insofar as they may have become entitled to payment of additional compensation by performance of services, they shall have the same rights as other employees under general law.

        
            	
                        7.19

                    	
                        Reliance on Reports.

                    

        

        Each member of the Committee shall be fully justified in relying, acting or failing to act, and shall not be liable for having so relied, acted or failed to act in good faith, upon any report made by the independent public accountant of the Company and upon any other information furnished in connection with the Plan by any person or persons other than himself or herself.

        
            	
                        7.20

                    	
                        Relationship to Other Benefits.

                    

        

        No payment under the Plan shall be taken into account in determining any benefits under any pension, retirement, profit sharing, group insurance or other benefit plan of the Company except as otherwise specifically provided.

        
            	
                        7.21

                    	
                        Expenses.

                    

        

        The expenses of administering the Plan shall be borne by the Company.

        
            	
                        7.22

                    	
                        Titles and Headings.

                    

        

        The titles and headings of the sections in the Plan are for convenience of reference only, and in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control.

        
            	
                        7.23

                    	
                        No Presumption.

                    

        

        The fact that this Agreement was prepared by counsel for the Company shall create no presumptions and specifically shall not cause any ambiguities to be construed against the Company.

        
            	
                        7.24

                    	
                        Nonexclusivity of the Plan.

                    

        

        Neither the adoption of this Plan by the Board nor the submission of this Plan to the shareholders of the Company for approval shall be construed as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable, including, without limitation, the granting of stock options otherwise than under this Plan, and such arrangements may
        be either applicable generally or only in specific cases.

         

        
            

            19

             

        

         

        

        

        

        
            	
                        7.25

                    	
                        No Liability of Committee Members.

                    

        

        No member of the Committee shall be personally liable by reason of any contract or other instrument executed by such member or on his or her behalf in his or her capacity as a member of the Committee nor for any mistake of judgment made in good faith, and the Company shall defend, indemnify and hold harmless each member of the Board and each other employee, officer or Director of the
        Company to whom any duty or power relating to the administration or interpretation of the Plan may be allocated or delegated, against any cost or expense (including counsel fees) or liability (including any sum paid in settlement of a claim) arising out of any act or omission to act in connection with the Plan unless arising out of such person’s own fraud or bad faith; provided,
        however, that approval of the Board shall be required for the payment of any amount in settlement of a claim against any such person. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company’s Articles of Incorporation or Bylaws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them
        harmless.

        
            	
                        7.26

                    	
                        Governing Law; Construction.

                    

        

        The Plan shall be governed by the laws of the state of Florida without regard to its conflict of laws principles. In case any one or more of the provisions contained herein are for any reason deemed to be invalid, illegal or unenforceable in any respect by a judicial body having jurisdiction, such illegality, invalidity or unenforceability shall not effect any other provision of this
        Plan, and this Plan shall be construed as if such invalid, unenforceable or illegal provision had never been contained herein. In construing the Plan, the singular shall include the plural and the masculine gender shall include the feminine and neuter, unless the context otherwise requires.

        
            	
                        7.27

                    	
                        Amendment of the Plan.

                    

        

        (a)       The Committee may, without receiving further consideration from the Participants, amend this Plan or condition or modify awards under this Plan in response to changes in securities or other laws or rules, regulations or regulatory interpretations thereof applicable to this Plan or to comply with stock exchange rules or
        requirements.

        (b)       The Committee may at any time and from time to time terminate or modify or amend the Plan in any respect, except that, without Board approval, the Committee may not materially amend the Plan, including, but not limited to, the following:

        (i)        materially increase the number of shares of Common Stock to be issued under the Plan (other than pursuant to Sections 7.16 and 7.17);

        (ii)       materially increase benefits to Participants, including any material change to (A) permit a re-pricing (or decrease in exercise price) of outstanding Options, (B) reduce the price at which Options may be offered, or (C) extend the duration of the Plan;

        (iii)      materially expand the class of Participants eligible to participate in the Plan; and

         

        
            

            20

             

        

         

        

        

        

        
            	
                         

                    	
                        (iv)

                    	
                        expand the types of Options or other awards provided under the Plan.

                    

        

        (c)       The termination or any modification or amendment of the Plan, except as provided in subsection (a), shall not without the consent of a Participant, affect his or her rights under an Award previously granted to him or her.

        
            	
                        7.28

                    	
                        Binding Effect.

                    

        

        This Agreement shall be legally binding upon and shall operate for the benefit of the parties hereto, their respective heirs, personal and legal representatives, transferees, successors and assigns.

        
            	
                        7.29

                    	
                        Survival.

                    

        

        All representations and other relevant provisions herein shall survive and thereby continue in full force and effect after termination of the Participant’s employment with or service to the Company.

        
            	
                        7.30

                    	
                        No Waiver of Breach.

                    

        

        The waiver or inaction by any party hereto of a breach of any condition of this Agreement by the other party shall not be construed as a waiver of any subsequent breach by such party, nor shall it constitute a waiver of that party’s rights, actual or inherent. The failure of any party hereto in any instance to insist upon a strict performance of the terms of this Agreement or to
        exercise any option herein shall not be construed as a waiver or a relinquishment in the future of such term or option, but that the same shall continue in full force and effect.

        
            	
                        7.31

                    	
                        Notices.

                    

        

        All notices or communications provided for herein or incidental to the transactions contemplated hereby shall be in writing and shall be deemed duly given if delivered personally, sent by facsimile, certified mail and/or by registered mail, return receipt requested or sent by overnight delivery (i) to any officer of the Company (other than the Participant) at the address of the
        principal office of the Company and (ii) to any Participant at his or her address as reflected on the records of the Company for federal income tax purposes or at such other address as either party may have specified by prior written notice to the other party. Notices shall be effective as of the date of personal delivery or as of the first day after any other notice procedure.

        
            	
                        7.32

                    	
                        WAIVER OF JURY TRIAL.

                    

        

        THE COMPANY AND EACH PERSON WHO IS A PARTICIPANT EXPRESSLY WAIVES ALL RIGHTS TO ANY TRIAL BY JURY IN ALL LITIGATION RELATING TO OR ARISING OUT OF THE SUBJECT MATTER OF THIS PLAN.

         

         

        
            

            2120-F

	

	 	Exhibit 4.2.2
	 	 
		 
	 	 
	 	July 7, 2008
	 	 
	To:

    Enrico Gardini, via Rimodello 16, 40050 Monteveglio (BO) Italy.

    Alberto Zega, via Mascarella 116, 40126 Bologna- Italy.

    Roberto Rizzo, via Martiri della Liberta’ 68, 31100 Treviso- Italy.

    Esa Software S.p.A. via Draghi 39,47900 Rimini-Italy

    (the “Sellers”)       	 By Fedex and by Email

Re: Second Call Option Exercise Notice

In connection with the Second Call Option Agreement, dated as of July 1, 2005, by and among the Sellers
and Cimatron Ltd. (“Cimatron”) (the “Second Call Option”), the undersigned hereby notifies you as follows:

All capitalized terms used but otherwise not defined herein shall have the meaning ascribed thereto
in the Second Call Option.

	1. 	Cimatron hereby elects to exercise the Option to purchase 49% of Micosystem Srl. (the “Company”), from the Sellers, pro rata to their holdings in the Company, in consideration for a total
exercise price of USD 1,249,500, all in accordance with the terms of the Second Call Option.
		 
	2. 	The Exercise Price shall be allocated as follows:
		 

	 	 Seller	 	 Share Capital	 	 %	 	 Payment in  US $	 
	 	 	 	 	 	 	 	 	 
	 	 Enrico Gardini 	 	 Euro 37,117.24 	 	 52.81	% 	 659,812.50 	 
	 	 Alberto Zega 	 	 Euro 6,186.21 	 	 8.80	% 	 109,968.75 	 
	 	 Roberto Rizzo 	 	 Euro 6,186.21 	 	 8.80	% 	 109,968.75 	 
	 	 Esa Software S.p.A 	 	 Euro 20,800.00 	 	 29.59	% 	 369,750.00 	 
	 	 	 	 	 	 	 	 	 
	 	 Total	 	 Euro 70,289.66	 	 100	% 	 1,249,500	 

	 	 
	3. 	Payment of the Exercise Price will be made upon the execution by the Sellers of the application deeds of the transfer and such other documentation required to register Cimatron as the owner of the Option Participation and to transfer to Cimatron full and complete ownership thereof.

Cimatron Ltd. 11 Gush Etzion St. Givat Shmuel 54030 Israel, Tel. 972 -3-531-2121, Fax. 972-3-531-2192, www.cimatron.com

	
	 	 
	4. 	Cimatron expects to consummate the Option during the second half of July and will coordinate with you
the time and date, including execution of documents at a notary. It is anticipated that the closing
of the Option will take place on or about July  29, 2008.
		 
	5.	 Your prompt attention to this matter would be very much appreciated.
	 	 

	 	Sincerely 
Cimatron Ltd
/s/ Danny Haran, CEO
	 	 

We agreed and acknowledge the above, and in addition, we represent and warrant that the Company has
fully provided Cimatron with all the information that is reasonably necessary to enable Cimatron
to make its decision to exercise the Option and there is no material fact or information relating
to the business, prospects, condition (financial or otherwise), affairs, operations, or assets of
the Company that has not been disclosed to Cimatron in writing by either the Company or the undersigned.

	/s/ Enrico Gardini 
_________________	 
	Enrico Gardini 	 
	 	 
	/s/ Alberto Zega 
_________________	 
	Alberto Zega 	 
	 	 
	/s/ Roberto Rizzo
_________________	 
	Roberto Rizzo	 
	 	 
	 /s/ Esa Software S.p.A
_________________	 
	Esa Software S.p.A

    By:

    Tiltle:	 

Cimatron Ltd. 11 Gush Etzion St. Givat Shmuel 54030 Israel, Tel. 972 -3-531-2121, Fax. 972-3-531-2192, www.cimatron.com

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