Document:

exv10w21

 

Exhibit 10.21

Leadis Technology, Inc.

2004 Equity Incentive Plan

Phantom Stock Award Grant Notice

Leadis Technology, Inc. (the “Company”), pursuant to its 2004 Equity Incentive Plan (the
“Plan”), hereby grants to Participant a Phantom Stock Award covering the number of shares of
phantom stock (the “Phantom Stock”) set forth below (the “Award”). This Award shall be evidenced
by a Phantom Stock Award Agreement (the “Agreement”). This Award is subject to all of the terms
and conditions as set forth herein and in the Agreement and the Plan, which are attached hereto and
incorporated herein in their entirety.

	 	 	 
	     Participant:
	 	 
	 

	 	 
	     Date of Grant:
	 	 
	 

	 	 
	     Number of Shares of Phantom Stock:
	 	 
	 

	 	 
	     Payment for Phantom Stock:

	 	Participant’s services to the Company

	 	 	 
	Vesting Schedule:

	 	[One-half (1/2) of the Phantom Stock
shall vest on the date that is thirteen
(13) months following the Date of Grant.
The remaining one-half (1/2) of the
Phantom Stock shall vest on the second
anniversary of the Date of Grant,
provided that the Participant’s
Continuous Service has not terminated
prior to the applicable vesting date.]
	 
	 	 
	Deferral Election:
	 	 

	 	o	 	I elect not to defer issuance of the shares of Common Stock,
if any, that I may receive pursuant to my Award.
	 
	 	o	 	I elect to defer issuance of the shares of Common Stock, if
any, that I may receive pursuant to my Award and have completed
or will complete and submit the Deferral Election Form attached
hereto by                     , 2007.

Additional Terms/Acknowledgements: The undersigned Participant acknowledges receipt of, and
understands and agrees to, this Grant Notice, the Agreement and the Plan. Participant further
acknowledges that this Grant Notice, the Agreement and the Plan set forth the entire understanding
between Participant and the Company regarding the award of the Phantom Stock and the Common Stock
subject to the shares of Phantom Stock and supersede all prior oral and written agreements on that
subject with the exception of (i) awards previously granted and delivered to Participant under the
Plan, and (ii) the following agreements only:

	 	 	 
	     Other Agreements:
	 	 
	 

	 	 

	 	 	 	 	 	 	 
	Leadis Technology, Inc.	 	Participant
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Signature
	 	 	 	Signature
	 
	 	 	 	 	 	 
	Title:

	 	 	 	Date:	 	 
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 
	 

	 	 

	 	 	 	 

 

 

	 	 	 
	Attachments:

	 	Phantom Stock Award Agreement, Deferral Election Form, and Leadis Technology, Inc. 2004 Equity
Incentive Plan

 

 

Attachment I

Agreement

 

 

Leadis Technology, Inc.

2004 Equity Incentive Plan

Phantom Stock Award Agreement

     Pursuant to the Phantom Stock Award Grant Notice (“Grant Notice”) and this Phantom Stock Award
Agreement (“Agreement”), Leadis Technology, Inc. (the “Company”) has awarded you a Phantom Stock
Award under its 2004 Equity Incentive Plan (the “Plan”) for the number of shares of Phantom Stock
(“Phantom Stock”) as indicated in the Grant Notice (collectively, the “Award”). Except where
indicated otherwise, defined terms not explicitly defined in this Agreement but defined in the Plan
shall have the same definitions as in the Plan.

     The details of your Award are as follows:

     1. Number of Shares of Phantom Stock and Shares of Common Stock. The number of
shares of Phantom Stock subject to your Award is set forth in the Grant Notice. Each share of
Phantom Stock shall represent the right to receive one (1) share of Common Stock. The number of
shares of Phantom Stock subject to your Award and the number of shares of Common Stock deliverable
with respect to such Phantom Stock may be adjusted from time to time for capitalization adjustments
as described in Section 11(a) of the Plan.

     2. Vesting. The shares of Phantom Stock shall vest, if at all, as provided in the
vesting schedule set forth in your Grant Notice; provided, however, that vesting shall cease upon
the termination of your Continuous Service.

     3. Dividends. You shall receive no benefit or adjustment to your Award with respect
to any cash dividend or other distribution in respect of the Common Stock subject to your Award
that does not result in a capitalization adjustment pursuant to Section 11(a) of the Plan;
provided, however, that this sentence shall not apply with respect to any shares of Common Stock
that are actually delivered to you in connection with your Award, on and after the date of such
delivery. Any additional shares of Phantom Stock, Common Stock, cash or other property that become
subject to the Award pursuant to this Section 3 shall be subject, in a manner determined by the
Board, to the same forfeiture restrictions, restrictions on transferability, and time and manner of
delivery as applicable to the other shares of Phantom Stock and Common Stock subject to your Award.

     4. Payment. This Award was granted in consideration of your services to the Company.
Subject to Section 11 below, you will not be required to make any payment to the Company (other
than your services with the Company) with respect to your receipt of the Award, vesting of the
Phantom Stock, or the delivery of the shares of Common Stock subject to the Phantom Stock.

     5. Delivery of Shares. Subject to Section 11 below, your vested shares of Phantom
Stock shall be converted into shares of Common Stock, and the Company will deliver to you a number
of shares of Common Stock equal to the number of vested shares subject to your Award on the
applicable vesting date or as soon as practicable thereafter; provided, however, that

 

 

in the event that the Company determines that you are subject to its policy regarding insider
trading of the Company’s stock and any shares of Common Stock subject to your Award are scheduled
to be delivered on a day (the “Original Distribution Date”) that does not occur during an open
“window period” applicable to you, as determined by the Company in accordance with such policy,
then such shares shall not be delivered on such Original Distribution Date and shall instead be
delivered as soon as practicable within the next open “window period” applicable to you pursuant to
such policy; and provided further, that if you elect to defer issuance of the shares of Common
Stock as provided in Section 6 of this Agreement, the shares of Common Stock shall be issued as set
forth in your Deferral Election Form. The form of delivery (e.g., a stock certificate or
electronic entry evidencing such shares) shall be determined by the Company.

     6. Deferral Election. You may elect to defer issuance of the shares of Common Stock
that would otherwise be issued by virtue of the vesting of your Award as set forth in the Grant
Notice. If such deferral election is made, it shall be made in accordance with the following
requirements:

          (a) No deferral period shall exceed five (5) years from the original vesting date of the
Award; and

          (b) You must complete and submit a Deferral Election Form (in substantially the form attached
to the Grant Notice) to the Company within thirty (30) days following the date of grant set forth
in the Grant Notice.

     7. Securities Law Compliance. Notwithstanding anything to the contrary contained
herein, you will not be issued any shares of Common Stock under your Award unless either (a) such
shares are then registered under the Securities Act or (b) the Company has determined that such
issuance would be exempt from the registration requirements of the Securities Act. Your Award also
must comply with other applicable laws and regulations governing the Award, and you will not
receive any shares of Common Stock under your Award if the Company determines that such receipt
would not be in material compliance with such laws and regulations.

     8. Transfer Restrictions. Prior to the time that the shares of Common Stock subject
to your Award have been delivered to you, you may not transfer, pledge, sell or otherwise dispose
of such shares. For example, you may not use shares of Common Stock that may be issued in respect
of your shares of Phantom Stock as security for a loan, nor may you transfer, pledge, sell or
otherwise dispose of such shares. This restriction on transfer will lapse upon delivery to you of
shares of Common Stock in respect of your vested shares of Phantom Stock. Your Award is not
transferable, except by will or by the laws of descent and distribution. Notwithstanding the
foregoing, by delivering written notice to the Company, in a form satisfactory to the Company, you
may designate a third party who, in the event of your death, shall thereafter be entitled to
receive any distribution of shares of Common Stock in respect of vested shares of Phantom Stock
pursuant to this Agreement.

     9. Award not a Service Contract. Your Award is not an employment or service
contract, and nothing in your Award shall be deemed to create in any way whatsoever any obligation
on your part to continue in the service of the Company or any Affiliate, or on the

 

 

part of the Company or any Affiliate to continue such service. In addition, nothing in your
Award shall obligate the Company or any Affiliate, their respective stockholders, boards of
directors or employees to continue any relationship that you might have as an Employee, Director or
Consultant of the Company or any Affiliate.

     10. Unsecured Obligation. Your Award is unfunded, and even as a holder of vested
shares of Phantom Stock, you shall be considered an unsecured creditor of the Company with respect
to the Company’s obligation, if any, to distribute shares of Common Stock pursuant to this
Agreement. You shall not have voting or any other rights as a stockholder of the Company with
respect to the Common Stock acquired pursuant to this Agreement until such Common Stock is issued
to you. Nothing contained in this Agreement, and no action taken pursuant to its provisions, shall
create or be construed to create a trust of any kind or a fiduciary relationship between you and
the Company or any other person.

     11. Withholding Obligations.

          (a) On or before the time you receive a distribution of shares pursuant to your Award, or at
any time thereafter as requested by the Company, you hereby authorize withholding from, at the
Company’s election, vested shares of Common Stock distributable to you, payroll and any other
amounts payable to you and otherwise agree to make adequate provision for, as determined by the
Company, any sums required to satisfy the federal, state, local and foreign tax withholding
obligations of the Company or an Affiliate, if any, which arise in connection with your Award.

          (b) Notwithstanding Section 11(a), if you elect to defer issuance of the shares of Common
Stock as provided in Section 6 of this Agreement, you shall be required to make adequate provision
for any sums required to satisfy any federal, state, local and foreign tax withholding obligations
of the Company and/or any Affiliate which arise in connection with the vesting of your Award at the
time of such vesting.

          (c) Unless the tax withholding obligations of the Company or any Affiliate are satisfied, the
Company will have no obligation to deliver to you any shares of Common Stock pursuant to your
Award.

     12. Notices. Any notices provided for in your Award or the Plan shall be given in
writing and shall be deemed effectively given upon receipt or, in the case of notices delivered by
the Company to you, five (5) days after deposit in the United States mail, postage prepaid,
addressed to you at the last address you provided to the Company.

     13. Execution of Documents. You hereby acknowledge and agree that the manner
selected by the Company by which you indicate your consent to your Grant Notice is also deemed to
be your execution of your Grant Notice and of this Agreement. You further agree that such manner
of indicating consent may be relied upon as your signature for establishing your execution of any
documents to be executed in the future in connection with your Award. This Agreement shall be
deemed to be signed by the Company and you upon the respective signing by the Company and you of
the Grant Notice to which it is attached.

 

 

     14. Miscellaneous.

          (a)  The rights and obligations of the Company with respect to your Award shall be
transferable to any one or more persons or entities, and all covenants and agreements hereunder
shall inure to the benefit of, and be enforceable by the Company’s successors and assigns.

          (b) You agree upon request to execute any further documents or instruments necessary or
desirable in the sole determination of the Company to carry out the purposes or intent of your
Award.

          (c) You acknowledge and agree that you have reviewed your Award in its entirety, have had an
opportunity to obtain the advice of counsel prior to executing and accepting your Award and fully
understand all provisions of your Award.

          (d) This Agreement will be subject to all applicable laws, rules, and regulations, and to such
approvals by any governmental agencies or national securities exchanges as may be required.

          (e) All obligations of the Company under the Plan and this Agreement will be binding on any
successor to the Company, whether the existence of such successor is the result of a direct or
indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.

     15. Headings. The headings of the Sections in this Agreement are inserted for
convenience only and shall not be deemed to constitute a part of this Agreement or to affect the
meaning of this Agreement.

     16. Severability. If all or any part of this Agreement or the Plan is declared by
any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity
shall not invalidate any portion of this Agreement or the Plan not declared to be unlawful or
invalid. Any Section of this Agreement (or part of such a Section) so declared to be unlawful or
invalid shall, if possible, be construed in a manner which will give effect to the terms of such
Section or part of a Section to the fullest extent possible while remaining lawful and valid.

     17. Governing Plan Document. Your Award is subject to all the provisions of the Plan, the
provisions of which are hereby made a part of your Award, and is further subject to all
interpretations, amendments, rules and regulations which may from time to time be promulgated and
adopted pursuant to the Plan. In the event of any conflict between the provisions of your Award
and those of the Plan, the provisions of the Plan shall control.

 

 

Attachment II

Deferral Election Form

 

 

 Leadis Technology, Inc.

2004 Equity Incentive Plan

Phantom Stock Award Deferral Election Form

 

Note: Please complete this Deferral Election Form and return a signed copy to                      of
Leadis Technology, Inc. (the “Company”) by                     , 2007.

	1.	 	Deferral Election.
	 
	 	 	I acknowledge that I have been granted a Phantom Stock Award (“Award”) dated                    ,
2007 by the Company under its 2004 Equity Incentive Plan (the “Plan”). I hereby elect to
defer the issuance of shares of the Company’s Common Stock, if any, that I may receive
pursuant to such Award and to receive a stock certificate evidencing such shares as follows:

	 	 	 	 	 
	 	 	 	 	Number of Shares of
	Original Distribution Date 	 	Deferred Issuance Date*	 	Common Stock Deferred
	 

	 	 
	 	 

 

			
	*	 	Note: You may not elect a Deferred Issuance Date that is beyond five (5) years
from the original vesting date of the Award.

	 	 	I understand that if my Continuous Service (as defined in the Plan) with the Company or one
of its Affiliates is terminated prior to the deferred issuance date that I have indicated
above, my election to receive an issuance of shares on that date will be revoked. In that
event, I automatically will be issued a stock certificate evidencing the shares of Common
Stock in respect of the vested portion of my Award as soon as administratively practicable
following the termination of my Continuous Service, and any unvested portion of my Award
shall be forfeited.
	 
	2.	 	Deferred Compensation Agreement.

	 	(A)	 	I acknowledge that I have reviewed copies of and understand the terms of the
Phantom Stock Award Grant Notice (“Grant Notice”), Phantom Stock Award

 

 

	 	 	 	Agreement (“Agreement”), and Plan and that capitalized terms in this Deferral
Election Form are defined in the Grant Notice, Agreement, or Plan. I hereby agree to
defer issuance of the above-specified number of shares of Common Stock subject to my
Award and to have such shares issued to me at a later date pursuant to the terms and
conditions of this Deferral Election Form, Grant Notice, Agreement, and Plan, which
are incorporated by reference in their entirety into this Deferral Election Form.
	 
	 	 	 	Notwithstanding anything in this Deferral Election Form to the contrary, I understand
that in the event that the Company determines that I am subject to its policy
regarding insider trading of the Company’s stock and any shares of Common Stock in
respect of my Award are scheduled to be delivered on a day (the “Deferred Issuance
Date”) that does not occur during a “window period” applicable to me, as determined
by the Company in accordance with such policy, then such shares shall not be
delivered on such Deferred Issuance Date and shall instead be delivered as soon as
practicable within the next “window period” applicable to me pursuant to such policy.
	 
	 	(B)	 	I understand that the Company and and/or any Affiliate shall have certain tax
withholding obligations at the time I become vested in my right to receive the shares
of Common Stock subject to my Award. and at the time I receive the shares of Common
Stock in respect of the vested portion of my Award. I agree to make adequate provision
for any sums required to satisfy such withholding obligations.
	 
	 	(C)	 	I understand that the establishment of the Grant Notice, Agreement, or Plan, as
well as my election made herein, do not create a legal or equitable right or claim
against the Company or an Affiliate, except as expressly provided in this Deferral
Election Form or the Grant Notice, Agreement, or Plan, and in no event shall the terms
of my employment or service with the Company or an Affiliate be modified or in any way
affected by this Deferral Election Form or the Grant Notice, Agreement, or Plan. I
further understand that this Deferral Election Form and the Grant Notice, Agreement,
and Plan are not agreements for employment or other services and are not a guarantee of
future compensation from, or employment or service with, the Company or an Affiliate.
	 
	 	(D)	 	I understand that any shares of Common Stock that I defer pursuant to this
Deferral Election Form will remain an asset of the Company and subject to the claims of
its general creditors in the event of its bankruptcy or insolvency.

	 	 	 
	 

	 	 
	Participant’s Name (please print or type)

	 	Social Security Number
	 
	 	 
	 

	 	 
	Participant’s Signature

	 	Date

 

 

 Attachment III

Leadis Technology, Inc. 2004 Equity Incentive Plan 

 

 

Leadis Technology, Inc.

2004 Equity Incentive Plan

Phantom Stock Award Grant Notice

Leadis Technology, Inc. (the “Company”), pursuant to its 2004 Equity Incentive Plan (the
“Plan”), hereby grants to Participant a Phantom Stock Award covering the number of shares of
phantom stock (the “Phantom Stock”) set forth below (the “Award”). This Award shall be evidenced
by a Phantom Stock Award Agreement (the “Agreement”). This Award is subject to all of the terms
and conditions as set forth herein and in the Agreement and the Plan, which are attached hereto and
incorporated herein in their entirety.

	 	 	 
	     Participant:
	 	 
	 

	 	 
	     Date of Grant:
	 	 
	 

	 	 
	     Vesting Commencement Date:
	 	 
	 

	 	 
	     Number of Shares of Phantom Stock:
	 	 
	 

	 	 
	     Payment for Phantom Stock:

	 	Participant’s services to the Company

	 	 	 
	Vesting Schedule: 

	 	[One-half (1/2) of the Phantom Stock
shall vest on each of the first and
second anniversaries of the Vesting
Commencement Date, provided that the
Participant’s Continuous Service has not
terminated prior to the applicable
vesting date.]

Additional Terms/Acknowledgements: The undersigned Participant acknowledges receipt of, and
understands and agrees to, this Grant Notice, the Agreement and the Plan. Participant further
acknowledges that this Grant Notice, the Agreement and the Plan set forth the entire understanding
between Participant and the Company regarding the award of the Phantom Stock and the Common Stock
subject to the shares of Phantom Stock and supersede all prior oral and written agreements on that
subject with the exception of (i) awards previously granted and delivered to Participant under the
Plan, and (ii) the following agreements only:

	 	 	 
	     Other Agreements:
	 	 
	 

	 	 

	 	 	 	 	 	 	 
	Leadis Technology, Inc.	 	Participant
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 
	 

	 	Signature
	 	 	 	Signature
	 
	 	 	 	 	 	 
	Title:

	 	 	 	Date:	 	 
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Date:
	 	 	 	 	 
	 

	 	 

	 	 	 	 

	 	 	 
	Attachments:

	 	Phantom Stock Award Agreement and Leadis Technology, Inc. 2004 Equity Incentive Plan

 

 

Attachment I

Agreement

 

 

 Leadis Technology, Inc.

2004 Equity Incentive Plan

Phantom Stock Award Agreement

     Pursuant to the Phantom Stock Award Grant Notice (“Grant Notice”) and this Phantom Stock Award
Agreement (“Agreement”), Leadis Technology, Inc. (the “Company”) has awarded you a Phantom Stock
Award under its 2004 Equity Incentive Plan (the “Plan”) for the number of shares of Phantom Stock
(“Phantom Stock”) as indicated in the Grant Notice (collectively, the “Award”). Except where
indicated otherwise, defined terms not explicitly defined in this Agreement but defined in the Plan
shall have the same definitions as in the Plan.

     The details of your Award are as follows:

     18. Number of Shares of Phantom Stock and Shares of Common Stock. The number of
shares of Phantom Stock subject to your Award is set forth in the Grant Notice. Each share of
Phantom Stock shall represent the right to receive one (1) share of Common Stock. The number of
shares of Phantom Stock subject to your Award and the number of shares of Common Stock deliverable
with respect to such Phantom Stock may be adjusted from time to time for capitalization adjustments
as described in Section 11(a) of the Plan.

     19. Vesting. The shares of Phantom Stock shall vest, if at all, as provided in the
vesting schedule set forth in your Grant Notice; provided, however, that vesting shall cease upon
the termination of your Continuous Service.

     20. Dividends. You shall receive no benefit or adjustment to your Award with respect
to any cash dividend or other distribution in respect of the Common Stock subject to your Award
that does not result in a capitalization adjustment pursuant to Section 11(a) of the Plan;
provided, however, that this sentence shall not apply with respect to any shares of Common Stock
that are actually delivered to you in connection with your Award, on and after the date of such
delivery. Any additional shares of Phantom Stock, Common Stock, cash or other property that become
subject to the Award pursuant to this Section 3 shall be subject, in a manner determined by the
Board, to the same forfeiture restrictions, restrictions on transferability, and time and manner of
delivery as applicable to the other shares of Phantom Stock and Common Stock subject to your Award.

     21. Payment. This Award was granted in consideration of your services to the
Company. Subject to Section 10 below, you will not be required to make any payment to the Company
(other than your services with the Company) with respect to your receipt of the Award, vesting of
the Phantom Stock, or the delivery of the shares of Common Stock subject to the Phantom Stock.

     22. Delivery of Shares. Subject to Section 10 below, your vested shares of Phantom
Stock shall be converted into shares of Common Stock, and the Company will deliver to you a number
of shares of Common Stock equal to the number of vested shares subject to your Award on the
applicable vesting date or as soon as practicable thereafter; provided, however, that in the event
that the Company determines that you are subject to its policy regarding insider

1

 

trading of the Company’s stock and any shares of Common Stock subject to your Award are
scheduled to be delivered on a day (the “Original Distribution Date”) that does not occur during an
open “window period” applicable to you, as determined by the Company in accordance with such
policy, then such shares shall not be delivered on such Original Distribution Date and shall
instead be delivered as soon as practicable within the next open “window period” applicable to you
pursuant to such policy. The form of delivery (e.g., a stock certificate or electronic entry
evidencing such shares) shall be determined by the Company.

     23. Securities Law Compliance. Notwithstanding anything to the contrary contained
herein, you will not be issued any shares of Common Stock under your Award unless either (a) such
shares are then registered under the Securities Act or (b) the Company has determined that such
issuance would be exempt from the registration requirements of the Securities Act. Your Award also
must comply with other applicable laws and regulations governing the Award, and you will not
receive any shares of Common Stock under your Award if the Company determines that such receipt
would not be in material compliance with such laws and regulations.

     24. Transfer Restrictions. Prior to the time that the shares of Common Stock subject
to your Award have been delivered to you, you may not transfer, pledge, sell or otherwise dispose
of such shares. For example, you may not use shares of Common Stock that may be issued in respect
of your shares of Phantom Stock as security for a loan, nor may you transfer, pledge, sell or
otherwise dispose of such shares. This restriction on transfer will lapse upon delivery to you of
shares of Common Stock in respect of your vested shares of Phantom Stock. Your Award is not
transferable, except by will or by the laws of descent and distribution. Notwithstanding the
foregoing, by delivering written notice to the Company, in a form satisfactory to the Company, you
may designate a third party who, in the event of your death, shall thereafter be entitled to
receive any distribution of shares of Common Stock in respect of vested shares of Phantom Stock
pursuant to this Agreement.

     25. Award not a Service Contract. Your Award is not an employment or service
contract, and nothing in your Award shall be deemed to create in any way whatsoever any obligation
on your part to continue in the service of the Company or any Affiliate, or on the part of the
Company or any Affiliate to continue such service. In addition, nothing in your Award shall
obligate the Company or any Affiliate, their respective stockholders, boards of directors or
employees to continue any relationship that you might have as an Employee, Director or Consultant
of the Company or any Affiliate.

2

 

     26. Unsecured Obligation. Your Award is unfunded, and even as a holder of vested
shares of Phantom Stock, you shall be considered an unsecured creditor of the Company with respect
to the Company’s obligation, if any, to distribute shares of Common Stock pursuant to this
Agreement. You shall not have voting or any other rights as a stockholder of the Company with
respect to the Common Stock acquired pursuant to this Agreement until such Common Stock is issued
to you. Nothing contained in this Agreement, and no action taken pursuant to its provisions, shall
create or be construed to create a trust of any kind or a fiduciary relationship between you and
the Company or any other person.

     27. Withholding Obligations.

          (a) On or before the time you receive a distribution of shares pursuant to your Award, or at
any time thereafter as requested by the Company, you hereby authorize withholding from, at the
Company’s election, vested shares of Common Stock distributable to you, payroll and any other
amounts payable to you and otherwise agree to make adequate provision for, as determined by the
Company, any sums required to satisfy the federal, state, local and foreign tax withholding
obligations of the Company or an Affiliate, if any, which arise in connection with your Award.

          (b) Unless the tax withholding obligations of the Company or any Affiliate are satisfied, the
Company will have no obligation to deliver to you any shares of Common Stock pursuant to your
Award.

     28. Notices. Any notices provided for in your Award or the Plan shall be given in
writing and shall be deemed effectively given upon receipt or, in the case of notices delivered by
the Company to you, five (5) days after deposit in the United States mail, postage prepaid,
addressed to you at the last address you provided to the Company.

     29. Execution of Documents. You hereby acknowledge and agree that the manner
selected by the Company by which you indicate your consent to your Grant Notice is also deemed to
be your execution of your Grant Notice and of this Agreement. You further agree that such manner
of indicating consent may be relied upon as your signature for establishing your execution of any
documents to be executed in the future in connection with your Award. This Agreement shall be
deemed to be signed by the Company and you upon the respective signing by the Company and you of
the Grant Notice to which it is attached.

     30. Miscellaneous.

          (a)  The rights and obligations of the Company with respect to your Award shall be
transferable to any one or more persons or entities, and all covenants and agreements hereunder
shall inure to the benefit of, and be enforceable by the Company’s successors and assigns.

          (b) You agree upon request to execute any further documents or instruments necessary or
desirable in the sole determination of the Company to carry out the purposes or intent of your
Award.

3

 

          (c) You acknowledge and agree that you have reviewed your Award in its entirety, have had an
opportunity to obtain the advice of counsel prior to executing and accepting your Award and fully
understand all provisions of your Award.

          (d) This Agreement will be subject to all applicable laws, rules, and regulations, and to such
approvals by any governmental agencies or national securities exchanges as may be required.

          (e) All obligations of the Company under the Plan and this Agreement will be binding on any
successor to the Company, whether the existence of such successor is the result of a direct or
indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.

     31. Headings. The headings of the Sections in this Agreement are inserted for
convenience only and shall not be deemed to constitute a part of this Agreement or to affect the
meaning of this Agreement.

     32. Severability. If all or any part of this Agreement or the Plan is declared by
any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity
shall not invalidate any portion of this Agreement or the Plan not declared to be unlawful or
invalid. Any Section of this Agreement (or part of such a Section) so declared to be unlawful or
invalid shall, if possible, be construed in a manner which will give effect to the terms of such
Section or part of a Section to the fullest extent possible while remaining lawful and valid.

     33. Governing Plan Document. Your Award is subject to all the provisions of the
Plan, the provisions of which are hereby made a part of your Award, and is further subject to all
interpretations, amendments, rules and regulations which may from time to time be promulgated and
adopted pursuant to the Plan. In the event of any conflict between the provisions of your Award
and those of the Plan, the provisions of the Plan shall control.

4

 

Attachment II

Leadis Technology, Inc. 2004 Equity Incentive Plan<PAGE>
                                                                    EXHIBIT 10.4

                           ALTUS PHARMACEUTICALS INC.

                              AMENDED AND RESTATED
                2002 EMPLOYEE, DIRECTOR AND CONSULTANT STOCK PLAN
                        (AS AMENDED ON FEBRUARY 2, 2007)

1.    DEFINITIONS.

      Unless otherwise specified or unless the context otherwise requires, the
      following terms, as used in this ALTUS PHARMACEUTICALS INC. Amended and
      Restated 2002 Employee, Director and Consultant Stock Plan, have the
      following meanings:

            Administrator means the Board of Directors, unless it has delegated
            power to act on its behalf to the Committee, in which case the
            Administrator means the Committee.

            Affiliate means a corporation which, for purposes of Section 424 of
            the Code, is a parent or subsidiary of the Company, direct or
            indirect.

            Agreement means an agreement between the Company and a Participant
            delivered pursuant to the Plan, in such form as the Administrator
            shall approve.

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

            Code means the United States Internal Revenue Code of 1986, as
            amended.

            Committee means the committee of the Board of Directors to which the
            Board of Directors has delegated power to act under or pursuant to
            the provisions of the Plan.

            Common Stock means shares of the Company's common stock, $.01 par
            value per share.

            Company means Altus Pharmaceuticals Inc., a Delaware corporation.

            Disability or Disabled means permanent and total disability as
            defined in Section 22(e)(3) of the Code.

            Employee means any employee of the Company or of an Affiliate
            (including, without limitation, an employee who is also serving as
            an officer or director of the Company or of an Affiliate),
            designated by the Administrator to be eligible to be granted one or
            more Stock Rights under the Plan.

<PAGE>

            Fair Market Value of a Share of Common Stock means:

            (1) If the Common Stock is then listed on any national securities
            exchange or traded in the over-the-counter market and sales prices
            are regularly reported for the Common Stock, the closing or last
            price of the Common Stock on the Composite Tape or other comparable
            reporting system for the trading day on the applicable date and if
            such applicable date is not a trading day, the last market trading
            day prior to such date;

            (2) If the Common Stock is not then traded on a national securities
            exchange but is traded on the over-the-counter market, if sales
            prices are not regularly reported for the Common Stock for the
            trading day referred to in clause (1) above, and if the bid and
            asked prices for the Common Stock are regularly reported, the mean
            between the bid and asked price for the Common Stock at the close of
            trading in the over-the-counter market for the trading day on which
            Common Stock was traded on the applicable date and if such
            applicable date is not a trading day, the last market trading day
            prior to such date; and

            (3) If the Common Stock is neither listed on a national securities
            exchange nor traded in the over-the-counter market, such value as
            the Administrator, in good faith, shall determine.

            ISO means an option meant to qualify as an incentive stock option
            under Section 422 of the Code.

            Non-Qualified Option means an option which is not intended to
            qualify as an ISO.

            Option means an ISO or Non-Qualified Option granted under the Plan.

            Participant means an Employee, director or consultant of the Company
            or an Affiliate to whom one or more Stock Rights are granted under
            the Plan. As used herein, "Participant" shall include "Participant's
            Survivors" where the context requires.

            Plan means this Altus Pharmaceuticals Inc. Amended and Restated 2002
            Employee, Director and Consultant Stock Plan.

            Shares means shares of the Common Stock as to which Stock Rights
            have been or may be granted under the Plan or any shares of capital
            stock into which the Shares are changed or for which they are
            exchanged within the provisions of Paragraph 3 of the Plan. The
            Shares issued under the Plan may be authorized and unissued shares
            or shares held by the Company in its treasury, or both.

            Stock-Based Award means a grant by the Company under the Plan of an
            equity award or an equity based award which is not an Option or a
            Stock Grant.

                                       2
<PAGE>

            Stock Grant means a grant by the Company of Shares under the Plan.

            Stock Right means a right to Shares or the value of Shares of the
            Company granted pursuant to the Plan -- an ISO, a Non-Qualified
            Option, a Stock Grant or a Stock-Based Award.

            Survivor means a deceased Participant's legal representatives and/or
            any person or persons who acquired the Participant's rights to a
            Stock Right by will or by the laws of descent and distribution.

2. PURPOSES OF THE PLAN.

      The Plan is intended to encourage ownership of Shares by Employees and
directors of and certain consultants to the Company in order to attract and
retain such people, to induce them to work for the benefit of the Company or of
an Affiliate and to provide additional incentive for them to promote the success
of the Company or of an Affiliate. The Plan provides for the granting of ISOs,
Non-Qualified Options, Stock Grants and Stock-Based Awards.

3. SHARES SUBJECT TO THE PLAN.

      (a) The number of Shares which may be issued from time to time pursuant to
this Plan shall be the sum of: (i) 4,199,651 shares of Common Stock and (ii) any
shares of Common Stock that are represented by awards granted under the
Company's 1993 Stock Option Plan, as amended, that are forfeited, expire or are
cancelled without delivery of shares of Common Stock or which result in the
forfeiture of shares of Common Stock back to the Company on or after December
31, 2005, or the equivalent of such number of Shares after the Administrator, in
its sole discretion, has interpreted the effect of any stock split, stock
dividend, combination, recapitalization or similar transaction in accordance
with Paragraph 24 of this Plan; provided, however, that no more than 354,186
Shares shall be added to the Plan pursuant to this provision.

      (b) Notwithstanding Subparagraph (a) above, on the first day of each
fiscal year of the Company during the period beginning on and including the
first day of fiscal year 2007, and ending on the second day of fiscal year 2015,
the number of Shares that may be issued from time to time pursuant to the Plan,
shall be increased by an amount equal to the lesser of (i) 1,500,000 or the
equivalent of such number of Shares after the Administrator, in its sole
discretion, has interpreted the effect of any stock split, stock dividend,
combination, recapitalization or similar transaction in accordance with
Paragraph 24 of the Plan; (ii) 3% of the number of shares of Common Stock
outstanding on a fully diluted basis as of the close of business on the
immediately preceding day (calculated by adding to the number of shares of
Common Stock outstanding, all outstanding securities convertible into Common
Stock on such date on an as converted basis); and (iii) an amount determined by
the Board.

                                       3
<PAGE>

      (c) If an Option ceases to be "outstanding", in whole or in part (other
than by exercise), or if the Company shall reacquire (at not more than its
original issuance price) any Shares issued pursuant to a Stock Grant or
Stock-Based Award, or if any Stock Right expires or is forfeited, cancelled, or
otherwise terminated or results in any Shares not being issued, the unissued
Shares which were subject to such Stock Right shall again be available for
issuance from time to time pursuant to this Plan.

4. ADMINISTRATION OF THE PLAN.

      The Administrator of the Plan will be the Board of Directors, except to
the extent the Board of Directors delegates its authority to the Committee, in
which case the Committee shall be the Administrator. Subject to the provisions
of the Plan, the Administrator is authorized to:

      a.    Interpret the provisions of the Plan and all Stock Rights and to
            make all rules and determinations which it deems necessary or
            advisable for the administration of the Plan;

      b.    Determine which Employees, directors and consultants shall be
            granted Stock Rights;

      c.    Determine the number of Shares for which a Stock Right or Stock
            Rights shall be granted; provided, however, that in no event shall
            Stock Rights with respect to more than 560,000 Shares be granted to
            any Participant in any fiscal year;

      d.    Specify the terms and conditions upon which a Stock Right or Stock
            Rights may be granted;

      e.    Make changes to any outstanding Stock Right, including, without
            limitation, to reduce or increase the exercise price or purchase
            price, accelerate the vesting schedule or extend the expiration
            date, provided that no such change shall impair the rights of a
            Participant under any grant previously made without such
            Participant's consent;

      f.    Buy out for a payment in cash or Shares, a Stock Right previously
            granted and/or cancel any such Stock Right and grant in substitution
            therefor other Stock Rights, covering the same or a different number
            of Shares and having an exercise price or purchase price per share
            which may be lower or higher than the exercise price or purchase
            price of the cancelled Stock Right, based on such terms and
            conditions as the Administrator shall establish and the Participant
            shall accept; and

      g.    Adopt any sub-plans applicable to residents of any specified
            jurisdiction as it deems necessary or appropriate in order to comply
            with or take advantage of any tax or other laws applicable to the
            Company or to Plan Participants or to otherwise facilitate the
            administration of the Plan, which sub-plans may include

                                       4
<PAGE>

            additional restrictions or conditions applicable to Stock Rights or
            Shares issuable pursuant to a Stock Right.

provided, however, that all such interpretations, rules, determinations, terms
and conditions shall be made and prescribed in the context of preserving the tax
status under Section 422 of the Code of those Options which are designated as
ISOs. Subject to the foregoing, the interpretation and construction by the
Administrator of any provisions of the Plan or of any Stock Right granted under
it shall be final, unless otherwise determined by the Board of Directors, if the
Administrator is the Committee. In addition, if the Administrator is the
Committee, the Board of Directors may take any action under the Plan that would
otherwise be the responsibility of the Committee.

      To the extent permitted under applicable law, the Board of Directors or
the Committee may allocate all or any portion of its responsibilities and powers
to any one or more of its members and may delegate all or any portion of its
responsibilities and powers to any other person selected by it. The Board of
Directors or the Committee may revoke any such allocation or delegation at any
time.

5. ELIGIBILITY FOR PARTICIPATION.

      The Administrator will, in its sole discretion, name the Participants in
the Plan, provided, however, that each Participant must be an Employee, director
or consultant of the Company or of an Affiliate at the time a Stock Right is
granted. Notwithstanding the foregoing, the Administrator may authorize the
grant of a Stock Right to a person not then an Employee, director or consultant
of the Company or of an Affiliate; provided, however, that the actual grant of
such Stock Right shall be conditioned upon such person becoming eligible to
become a Participant at or prior to the time of the execution of the Agreement
evidencing such Stock Right. ISOs may be granted only to Employees.
Non-Qualified Options, Stock Grants and Stock-Based Awards may be granted to any
Employee, director or consultant of the Company or an Affiliate. The granting of
any Stock Right to any individual shall neither entitle that individual to, nor
disqualify him or her from, participation in any other grant of Stock Rights.

6. TERMS AND CONDITIONS OF OPTIONS.

      Each Option shall be set forth in writing in an Option Agreement, duly
executed by the Company and, to the extent required by law or requested by the
Company, by the Participant. The Administrator may provide that Options be
granted subject to such terms and conditions, consistent with the terms and
conditions specifically required under this Plan, as the Administrator may deem
appropriate including, without limitation, subsequent approval by the
shareholders of the Company of this Plan or any amendments thereto. The Option
Agreements shall be subject to at least the following terms and conditions:

      A.    Non-Qualified Options: Each Option intended to be a Non-Qualified
            Option shall be subject to the terms and conditions which the
            Administrator determines to be

                                       5
<PAGE>

            appropriate and in the best interest of the Company, subject to the
            following minimum standards for any such Non-Qualified Option:

            a.    Option Price: Each Option Agreement shall state the option
                  price (per share) of the Shares covered by each Option, which
                  option price shall be determined by the Administrator; in
                  general, such price shall not be less than the Fair Market
                  Value per share of Common Stock.

            b.    Number of Shares: Each Option Agreement shall state the number
                  of Shares to which it pertains.

            c.    Option Periods: Each Option Agreement shall state the date or
                  dates on which it first is exercisable and the date after
                  which it may no longer be exercised, and may provide that the
                  Option rights accrue or become exercisable in installments
                  over a period of months or years, or upon the occurrence of
                  certain conditions or the attainment of stated goals or
                  events.

            d.    Option Conditions: Exercise of any Option may be conditioned
                  upon the Participant's execution of a Share purchase agreement
                  in form satisfactory to the Administrator providing for
                  certain protections for the Company and its other
                  shareholders, including requirements that:

                  i.    The Participant's or the Participant's Survivors' right
                        to sell or transfer the Shares may be restricted; and

                  ii.   The Participant or the Participant's Survivors may be
                        required to execute letters of investment intent and
                        must also acknowledge that the Shares will bear legends
                        noting any applicable restrictions.

      B.    ISOs: Each Option intended to be an ISO shall be issued only to an
            Employee and be subject to the following terms and conditions, with
            such additional restrictions or changes as the Administrator
            determines are appropriate but not in conflict with Section 422 of
            the Code and relevant regulations and rulings of the Internal
            Revenue Service:

            a.    Minimum standards: The ISO shall meet the minimum standards
                  required of Non-Qualified Options, as described in Paragraph
                  6(A) above.

            b.    Option Price: Immediately before the ISO is granted, if the
                  Participant owns, directly or by reason of the applicable
                  attribution rules in Section 424(d) of the Code:

                  i.    10% or less of the total combined voting power of all
                        classes of stock of the Company or an Affiliate, the
                        Option price per share of the Shares covered by each ISO
                        shall not be less than 100% of the

                                       6
<PAGE>

                        Fair Market Value per share of the Shares on the date of
                        the grant of the Option; or

                  ii.   More than 10% of the total combined voting power of all
                        classes of stock of the Company or an Affiliate, the
                        Option price per share of the Shares covered by each ISO
                        shall not be less than 110% of the Fair Market Value on
                        the date of grant.

            c.    Term of Option: For Participants who own:

                  i.    10% or less of the total combined voting power of all
                        classes of stock of the Company or an Affiliate, each
                        ISO shall terminate not more than ten years from the
                        date of the grant or at such earlier time as the Option
                        Agreement may provide; or

                  ii.   More than 10% of the total combined voting power of all
                        classes of stock of the Company or an Affiliate, each
                        ISO shall terminate not more than five years from the
                        date of the grant or at such earlier time as the Option
                        Agreement may provide.

            d.    Limitation on Yearly Exercise: The Option Agreements shall
                  restrict the amount of ISOs which may become exercisable in
                  any calendar year (under this or any other ISO plan of the
                  Company or an Affiliate) so that the aggregate Fair Market
                  Value (determined at the time each ISO is granted) of the
                  stock with respect to which ISOs are exercisable for the first
                  time by the Participant in any calendar year does not exceed
                  $100,000.

7. TERMS AND CONDITIONS OF STOCK GRANTS.

      Each offer of a Stock Grant to a Participant shall state the date prior to
which the Stock Grant must be accepted by the Participant, and the principal
terms of each Stock Grant shall be set forth in a Stock Grant Agreement, duly
executed by the Company and, to the extent required by law or requested by the
Company, by the Participant. The Stock Grant Agreement shall be in a form
approved by the Administrator and shall contain terms and conditions which the
Administrator determines to be appropriate and in the best interest of the
Company, subject to the following minimum standards:

      (a)   Each Stock Grant Agreement shall state the purchase price (per
            share), if any, of the Shares covered by each Stock Grant, which
            purchase price shall be determined by the Administrator but shall
            not be less than the minimum consideration required by the Delaware
            General Corporation Law on the date of the grant of the Stock Grant;

                                       7
<PAGE>

      (b)   Each Stock Grant Agreement shall state the number of Shares to which
            the Stock Grant pertains; and

      (c)   Each Stock Grant Agreement shall include the terms of any right of
            the Company to restrict or reacquire the Shares subject to the Stock
            Grant, including the time and events upon which such reacquisition
            rights shall accrue and the purchase price therefor, if any.

8. TERMS AND CONDITIONS OF OTHER STOCK-BASED AWARDS.

      The Board shall have the right to grant other Stock-Based Awards based
upon the Common Stock having such terms and conditions as the Board may
determine, including, without limitation, the grant of Shares based upon certain
conditions, the grant of securities convertible into Shares and the grant of
stock appreciation rights, phantom stock awards or stock units. The principal
terms of each Stock-Based Award shall be set forth in an Agreement, duly
executed by the Company and, to the extent required by law or requested by the
Company, by the Participant. The Agreement shall be in a form approved by the
Administrator and shall contain terms and conditions which the Administrator
determines to be appropriate and in the best interest of the Company.

9. EXERCISE OF OPTIONS AND ISSUE OF SHARES.

      An Option (or any part or installment thereof) shall be exercised by
giving written notice to the Company or its designee, together with provision
for payment of the full purchase price in accordance with this Paragraph for the
Shares as to which the Option is being exercised, and upon compliance with any
other condition(s) set forth in the Option Agreement. Such notice shall be
signed by the person exercising the Option, shall state the number of Shares
with respect to which the Option is being exercised and shall contain any
representation required by the Plan or the Option Agreement. Payment of the
purchase price for the Shares as to which such Option is being exercised shall
be made (a) in United States dollars in cash or by check, or (b) at the
discretion of the Administrator, through delivery of shares of Common Stock
having a Fair Market Value equal as of the date of the exercise to the cash
exercise price of the Option, or (c) at the discretion of the Administrator, in
accordance with a cashless exercise program established with a securities
brokerage firm, and approved by the Administrator, or (d) at the discretion of
the Administrator, by any combination of (a), (b) and (c) above, or (e) at the
discretion of the Administrator, payment of such other lawful consideration as
the Administrator may determine. Notwithstanding the foregoing, the
Administrator shall accept only such payment on exercise of an ISO as is
permitted by Section 422 of the Code.

      The Company shall then reasonably promptly deliver the Shares as to which
such Option was exercised to the Participant (or to the Participant's Survivors,
as the case may be). In determining what constitutes "reasonably promptly," it
is expressly understood that the issuance and delivery of the Shares may be
delayed by the Company in order to comply with any law or regulation (including,
without limitation, state securities or "blue sky" laws) which requires the

                                       8
<PAGE>

Company to take any action with respect to the Shares prior to their issuance.
The Shares shall, upon delivery, be fully paid, non-assessable Shares.

      The Administrator shall have the right to accelerate the date of exercise
of any installment of any Option; provided that the Administrator shall not
accelerate the exercise date of any installment of any Option granted to an
Employee as an ISO (and not previously converted into a Non-Qualified Option
pursuant to Paragraph 27) if such acceleration would violate the annual vesting
limitation contained in Section 422(d) of the Code, as described in Paragraph
6.B.d.

      The Administrator may, in its discretion, amend any term or condition of
an outstanding Option provided (i) such term or condition as amended is
permitted by the Plan, (ii) any such amendment shall be made only with the
consent of the Participant to whom the Option was granted, or in the event of
the death of the Participant, the Participant's Survivors, if the amendment is
adverse to the Participant, and (iii) any such amendment of any ISO shall be
made only after the Administrator determines whether such amendment would
constitute a "modification" of any Option which is an ISO (as that term is
defined in Section 424(h) of the Code) or would cause any adverse tax
consequences for the holder of such ISO.

10. ACCEPTANCE OF STOCK GRANTS AND STOCK-BASED AWARDS AND ISSUE OF SHARES.

      A Stock Grant or Stock-Based Award (or any part or installment thereof)
shall be accepted by executing the applicable Agreement and delivering it to the
Company or its designee, together with provision for payment of the full
purchase price, if any, in accordance with this Paragraph for the Shares as to
which such Stock Grant or Stock-Based Award is being accepted, and upon
compliance with any other conditions set forth in the applicable Agreement.
Payment of the purchase price for the Shares as to which such Stock Grant or
Stock-Based Award is being accepted shall be made (a) in United States dollars
in cash or by check, or (b) at the discretion of the Administrator, through
delivery of shares of Common Stock having a Fair Market Value equal as of the
date of acceptance of the Stock Grant or Stock-Based Award to the purchase price
of the Stock Grant or Stock-Based Award, or (c) at the discretion of the
Administrator, by any combination of (a) and (b) above; or (d) at the discretion
of the Administrator, payment of such other lawful consideration as the
Administrator may determine.

      The Company shall then, if required by the applicable Agreement,
reasonably promptly deliver the Shares as to which such Stock Grant or
Stock-Based Award was accepted to the Participant (or to the Participant's
Survivors, as the case may be), subject to any escrow provision set forth in the
applicable Agreement. In determining what constitutes "reasonably promptly," it
is expressly understood that the issuance and delivery of the Shares may be
delayed by the Company in order to comply with any law or regulation (including,
without limitation, state securities or "blue sky" laws) which requires the
Company to take any action with respect to the Shares prior to their issuance.

                                       9
<PAGE>

      The Administrator may, in its discretion, amend any term or condition of
an outstanding Stock Grant or Stock-Based Award or applicable Agreement provided
(i) such term or condition as amended is permitted by the Plan, and (ii) any
such amendment shall be made only with the consent of the Participant to whom
the Stock Grant or Stock-Based Award was made, if the amendment is adverse to
the Participant.

11. RIGHTS AS A SHAREHOLDER.

      No Participant to whom a Stock Right has been granted shall have rights as
a shareholder with respect to any Shares covered by such Stock Right, except
after due exercise of the Option or acceptance of the Stock Grant or as set
forth in any Agreement, and tender of the full purchase price, if any, for the
Shares being purchased pursuant to such exercise or acceptance and registration
of the Shares in the Company's share register in the name of the Participant.

12. ASSIGNABILITY AND TRANSFERABILITY OF STOCK RIGHTS.

      By its terms, a Stock Right granted to a Participant shall not be
transferable by the Participant other than (i) by will or by the laws of descent
and distribution, or (ii) as approved by the Administrator in its discretion and
set forth in the applicable Agreement. Notwithstanding the foregoing, an ISO
transferred except in compliance with clause (i) above shall no longer qualify
as an ISO. The designation of a beneficiary of a Stock Right by a Participant,
with the prior approval of the Administrator and in such form as the
Administrator shall prescribe, shall not be deemed a transfer prohibited by this
Paragraph. Except as provided above, a Stock Right shall only be exercisable or
may only be accepted, during the Participant's lifetime, only by such
Participant (or by his or her legal representative) and shall not be assigned,
pledged or hypothecated in any way (whether by operation of law or otherwise)
and shall not be subject to execution, attachment or similar process. Any
attempted transfer, assignment, pledge, hypothecation or other disposition of
any Stock Right or of any rights granted thereunder contrary to the provisions
of this Plan, or the levy of any attachment or similar process upon a Stock
Right, shall be null and void.

13.   EFFECT ON OPTIONS OF TERMINATION OF SERVICE OTHER THAN "FOR CAUSE" OR
      DEATH OR DISABILITY.

      Except as otherwise provided in a Participant's Option Agreement, in the
event of a termination of service (whether as an employee, director or
consultant) with the Company or an Affiliate before the Participant has
exercised an Option, the following rules apply:

      a.    A Participant who ceases to be an employee, director or consultant
            of the Company or of an Affiliate (for any reason other than
            termination "for cause", Disability, or death for which events there
            are special rules in Paragraphs 14, 15 and 16, respectively), may
            exercise any Option granted to him or her to the extent that the
            Option is exercisable on the date of such termination of service,
            but only

                                       10
<PAGE>

            within such term as the Administrator has designated in a
            Participant's Option Agreement.

      b.    Except as provided in Subparagraph (c) below, or Paragraph 15 or 16,
            in no event may an Option intended to be an ISO, be exercised later
            than three months after the Participant's termination of employment.

      c.    The provisions of this Paragraph, and not the provisions of
            Paragraph 15 or 16, shall apply to a Participant who subsequently
            becomes Disabled or dies after the termination of employment,
            director status or consultancy, provided, however, in the case of a
            Participant's Disability or death within three months after the
            termination of employment, director status or consultancy, the
            Participant or the Participant's Survivors may exercise the Option
            within one year after the date of the Participant's termination of
            service, but in no event after the date of expiration of the term of
            the Option.

      d.    Notwithstanding anything herein to the contrary, if subsequent to a
            Participant's termination of employment, termination of director
            status or termination of consultancy, but prior to the exercise of
            an Option, the Board of Directors determines that, either prior or
            subsequent to the Participant's termination, the Participant engaged
            in conduct which would constitute "cause", then such Participant
            shall forthwith cease to have any right to exercise any Option.

      e.    A Participant to whom an Option has been granted under the Plan who
            is absent from work with the Company or with an Affiliate because of
            temporary disability (any disability other than a permanent and
            total Disability as defined in Paragraph 1 hereof), or who is on
            leave of absence for any purpose, shall not, during the period of
            any such absence, be deemed, by virtue of such absence alone, to
            have terminated such Participant's employment, director status or
            consultancy with the Company or with an Affiliate, except as the
            Administrator may otherwise expressly provide.

      f.    Except as required by law or as set forth in a Participant's Option
            Agreement, Options granted under the Plan shall not be affected by
            any change of a Participant's status within or among the Company and
            any Affiliates, so long as the Participant continues to be an
            employee, director or consultant of the Company or any Affiliate.

14. EFFECT ON OPTIONS OF TERMINATION OF SERVICE "FOR CAUSE".

      Except as otherwise provided in a Participant's Option Agreement, the
following rules apply if the Participant's service (whether as an employee,
director or consultant) with the Company or an Affiliate is terminated "for
cause" prior to the time that all his or her outstanding Options have been
exercised:

                                       11
<PAGE>

      a.    All outstanding and unexercised Options as of the time the
            Participant is notified his or her service is terminated "for cause"
            will immediately be forfeited.

      b.    For purposes of this Plan, "cause" shall include (and is not limited
            to) dishonesty with respect to the Company or any Affiliate,
            insubordination, substantial malfeasance or non-feasance of duty,
            unauthorized disclosure of confidential information, breach by the
            Participant of any provision of any employment, consulting,
            advisory, nondisclosure, non-competition or similar agreement
            between the Participant and the Company, and conduct substantially
            prejudicial to the business of the Company or any Affiliate. The
            determination of the Administrator as to the existence of "cause"
            will be conclusive on the Participant and the Company.

      c.    "Cause" is not limited to events which have occurred prior to a
            Participant's termination of service, nor is it necessary that the
            Administrator's finding of "cause" occur prior to termination. If
            the Administrator determines, subsequent to a Participant's
            termination of service but prior to the exercise of an Option, that
            either prior or subsequent to the Participant's termination the
            Participant engaged in conduct which would constitute "cause", then
            the right to exercise any Option is forfeited.

      d.    Any definition in an agreement between the Participant and the
            Company or an Affiliate, which contains a conflicting definition of
            "cause" for termination and which is in effect at the time of such
            termination, shall supersede the definition in this Plan with
            respect to that Participant.

15. EFFECT ON OPTIONS OF TERMINATION OF SERVICE FOR DISABILITY.

         Except as otherwise provided in a Participant's Option Agreement, a
Participant who ceases to be an employee, director or consultant of the Company
or of an Affiliate by reason of Disability may exercise any Option granted to
such Participant:

      a.    To the extent that the Option has become exercisable but has not
            been exercised on the date of Disability; and

      b.    In the event rights to exercise the Option accrue periodically, to
            the extent of a pro rata portion through the date of Disability of
            any additional vesting rights that would have accrued on the next
            vesting date had the Participant not become Disabled. The proration
            shall be based upon the number of days accrued in the current
            vesting period prior to the date of Disability.

      A Disabled Participant may exercise such rights only within the period
ending one year after the date of the Participant's termination of employment,
directorship or consultancy, as the case may be, notwithstanding that the
Participant might have been able to exercise the Option as to some or all of the
Shares on a later date if the Participant had not become Disabled and had

                                       12
<PAGE>

continued to be an employee, director or consultant or, if earlier, within the
originally prescribed term of the Option.

      The Administrator shall make the determination both of whether Disability
has occurred and the date of its occurrence (unless a procedure for such
determination is set forth in another agreement between the Company and such
Participant, in which case such procedure shall be used for such determination).
If requested, the Participant shall be examined by a physician selected or
approved by the Administrator, the cost of which examination shall be paid for
by the Company.

16. EFFECT ON OPTIONS OF DEATH WHILE AN EMPLOYEE, DIRECTOR OR CONSULTANT.

      Except as otherwise provided in a Participant's Option Agreement, in the
event of the death of a Participant while the Participant is an employee,
director or consultant of the Company or of an Affiliate, such Option may be
exercised by the Participant's Survivors:

      a.    To the extent that the Option has become exercisable but has not
            been exercised on the date of death; and

      b.    In the event rights to exercise the Option accrue periodically, to
            the extent of a pro rata portion through the date of death of any
            additional vesting rights that would have accrued on the next
            vesting date had the Participant not died. The proration shall be
            based upon the number of days accrued in the current vesting period
            prior to the Participant's date of death.

      If the Participant's Survivors wish to exercise the Option, they must take
all necessary steps to exercise the Option within one year after the date of
death of such Participant, notwithstanding that the decedent might have been
able to exercise the Option as to some or all of the Shares on a later date if
he or she had not died and had continued to be an employee, director or
consultant or, if earlier, within the originally prescribed term of the Option.

17. EFFECT OF TERMINATION OF SERVICE ON STOCK GRANTS.

      In the event of a termination of service (whether as an employee, director
or consultant) with the Company or an Affiliate for any reason before the
Participant has accepted a Stock Grant, such offer shall terminate.

      For purposes of this Paragraph 17 and Paragraph 18 below, a Participant to
whom a Stock Grant has been offered and accepted under the Plan who is absent
from work with the Company or with an Affiliate because of temporary disability
(any disability other than a permanent and total Disability as defined in
Paragraph 1 hereof), or who is on leave of absence for any purpose, shall not,
during the period of any such absence, be deemed, by virtue of such absence
alone, to

                                       13
<PAGE>

have terminated such Participant's employment, director status or consultancy
with the Company or with an Affiliate, except as the Administrator may otherwise
expressly provide.

      In addition, for purposes of this Paragraph 17 and Paragraph 18 below, any
change of employment or other service within or among the Company and any
Affiliates shall not be treated as a termination of employment, director status
or consultancy so long as the Participant continues to be an employee, director
or consultant of the Company or any Affiliate.

18.   EFFECT ON STOCK GRANTS OF TERMINATION OF SERVICE OTHER THAN "FOR CAUSE" OR
      DEATH OR DISABILITY.

      Except as otherwise provided in a Participant's Stock Grant Agreement, in
the event of a termination of service (whether as an employee, director or
consultant), other than termination "for cause," Disability, or death for which
events there are special rules in Paragraphs 19, 20 and 21, respectively, before
all Company rights of repurchase shall have lapsed, then the Company shall have
the right to repurchase that number of Shares subject to a Stock Grant as to
which the Company's repurchase rights have not lapsed.

19. EFFECT ON STOCK GRANTS OF TERMINATION OF SERVICE "FOR CAUSE".

      Except as otherwise provided in a Participant's Stock Grant Agreement, the
following rules apply if the Participant's service (whether as an employee,
director or consultant) with the Company or an Affiliate is terminated "for
cause":

      a.    All Shares subject to any Stock Grant shall be immediately subject
            to repurchase by the Company at the purchase price, if any, thereof.

      b.    For purposes of this Plan, "cause" shall include (and is not limited
            to) dishonesty with respect to the employer, insubordination,
            substantial malfeasance or non-feasance of duty, unauthorized
            disclosure of confidential information, breach by the Participant of
            any provision of any employment, consulting, advisory,
            nondisclosure, non-competition or similar agreement between the
            Participant and the Company, and conduct substantially prejudicial
            to the business of the Company or any Affiliate. The determination
            of the Administrator as to the existence of "cause" will be
            conclusive on the Participant and the Company.

      c.    "Cause" is not limited to events which have occurred prior to a
            Participant's termination of service, nor is it necessary that the
            Administrator's finding of "cause" occur prior to termination. If
            the Administrator determines, subsequent to a Participant's
            termination of service, that either prior or subsequent to the
            Participant's termination the Participant engaged in conduct which
            would constitute "cause," then the Company's right to repurchase all
            of such Participant's Shares shall apply.

                                       14
<PAGE>

      d.    Any definition in an agreement between the Participant and the
            Company or an Affiliate, which contains a conflicting definition of
            "cause" for termination and which is in effect at the time of such
            termination, shall supersede the definition in this Plan with
            respect to that Participant.

20. EFFECT ON STOCK GRANTS OF TERMINATION OF SERVICE FOR DISABILITY.

      Except as otherwise provided in a Participant's Stock Grant Agreement, the
following rules apply if a Participant ceases to be an employee, director or
consultant of the Company or of an Affiliate by reason of Disability: to the
extent the Company's rights of repurchase have not lapsed on the date of
Disability, they shall be exercisable; provided, however, that in the event such
rights of repurchase lapse periodically, such rights shall lapse to the extent
of a pro rata portion of the Shares subject to such Stock Grant through the date
of Disability as would have lapsed had the Participant not become Disabled. The
proration shall be based upon the number of days accrued prior to the date of
Disability.

      The Administrator shall make the determination both of whether Disability
has occurred and the date of its occurrence (unless a procedure for such
determination is set forth in another agreement between the Company and such
Participant, in which case such procedure shall be used for such determination).
If requested, the Participant shall be examined by a physician selected or
approved by the Administrator, the cost of which examination shall be paid for
by the Company.

21. EFFECT ON STOCK GRANTS OF DEATH WHILE AN EMPLOYEE, DIRECTOR OR CONSULTANT.

      Except as otherwise provided in a Participant's Stock Grant Agreement, the
following rules apply in the event of the death of a Participant while the
Participant is an employee, director or consultant of the Company or of an
Affiliate: to the extent the Company's rights of repurchase have not lapsed on
the date of death, they shall be exercisable; provided, however, that in the
event such rights of repurchase lapse periodically, such rights shall lapse to
the extent of a pro rata portion of the Shares subject to such Stock Grant
through the date of death as would have lapsed had the Participant not died. The
proration shall be based upon the number of days accrued prior to the
Participant's death.

                                       15
<PAGE>

22. PURCHASE FOR INVESTMENT.

      Unless the offering and sale of the Shares to be issued upon the
particular exercise or acceptance of a Stock Right shall have been effectively
registered under the Securities Act of 1933, as now in force or hereafter
amended (the "1933 Act"), the Company shall be under no obligation to issue the
Shares covered by such exercise unless and until the following conditions have
been fulfilled:

      a.    The person(s) who exercise(s) or accept(s) such Stock Right shall
            warrant to the Company, prior to the receipt of such Shares, that
            such person(s) are acquiring such Shares for their own respective
            accounts, for investment, and not with a view to, or for sale in
            connection with, the distribution of any such Shares, in which event
            the person(s) acquiring such Shares shall be bound by the provisions
            of the following legend which shall be endorsed upon the
            certificate(s) evidencing their Shares issued pursuant to such
            exercise or such grant:

                  "The shares represented by this certificate have been taken
                  for investment and they may not be sold or otherwise
                  transferred by any person, including a pledgee, unless (1)
                  either (a) a Registration Statement with respect to such
                  shares shall be effective under the Securities Act of 1933, as
                  amended, or (b) the Company shall have received an opinion of
                  counsel satisfactory to it that an exemption from registration
                  under such Act is then available, and (2) there shall have
                  been compliance with all applicable state securities laws."

      b.    At the discretion of the Administrator, the Company shall have
            received an opinion of its counsel that the Shares may be issued
            upon such particular exercise or acceptance in compliance with the
            1933 Act without registration thereunder.

23. DISSOLUTION OR LIQUIDATION OF THE COMPANY.

      Upon the dissolution or liquidation of the Company, all Options granted
under this Plan which as of such date shall not have been exercised and all
Stock Grants and Stock-Based Awards which have not been accepted will terminate
and become null and void; provided, however, that if the rights of a Participant
or a Participant's Survivors have not otherwise terminated and expired, the
Participant or the Participant's Survivors will have the right immediately prior
to such dissolution or liquidation to exercise or accept any Stock Right to the
extent that the Stock Right is exercisable or subject to acceptance as of the
date immediately prior to such dissolution or liquidation. Upon the dissolution
or liquidation of the Company, any outstanding Stock-Based Awards shall
immediately terminate unless otherwise determined by the Administrator or
specifically provided in the applicable Agreement.

                                       16
<PAGE>

24. ADJUSTMENTS.

      Upon the occurrence of any of the following events, a Participant's rights
with respect to any Stock Right granted to him or her hereunder shall be
adjusted as hereinafter provided, unless otherwise specifically provided in a
Participant's Agreement:

      A. Stock Dividends and Stock Splits. If (i) the shares of Common Stock
shall be subdivided or combined into a greater or smaller number of shares or if
the Company shall issue any shares of Common Stock as a stock dividend on its
outstanding Common Stock, or (ii) additional shares or new or different shares
or other securities of the Company or other non-cash assets are distributed with
respect to such shares of Common Stock, the number of shares of Common Stock
deliverable upon the exercise of an Option or acceptance of a Stock Grant may be
appropriately increased or decreased proportionately, and appropriate
adjustments may be made, including in the purchase price per share to reflect
such events. The number of Shares subject to the limitation in Paragraphs 3 and
4(c) shall also be proportionately adjusted upon the occurrence of such events.

      B. Corporate Transactions. If the Company is to be consolidated with or
acquired by another entity in a merger, sale of all or substantially all of the
Company's assets other than a transaction to merely change the state of
incorporation (a "Corporate Transaction"), the Administrator or the board of
directors of any entity assuming the obligations of the Company hereunder (the
"Successor Board"), shall, as to outstanding Options, either (i) make
appropriate provision for the continuation of such Options by substituting on an
equitable basis for the Shares then subject to such Options either the
consideration payable with respect to the outstanding shares of Common Stock in
connection with the Corporate Transaction or securities of any successor or
acquiring entity; or (ii) upon written notice to the Participants, provide that
all Options must be exercised (either to the extent then exercisable or, at the
discretion of the Administrator, or, upon a change of control of the Company,
all Options being made fully exercisable for purposes of this Subparagraph),
within a specified number of days of the date of such notice, at the end of
which period the Options shall terminate; or (iii) terminate all Options in
exchange for a cash payment equal to the excess of the Fair Market Value of the
Shares subject to such Options (either to the extent then exercisable or, at the
discretion of the Administrator, all Options being made fully exercisable for
purposes of this Subparagraph) over the exercise price thereof.

      Notwithstanding the foregoing, in the event the Corporate Transaction also
constitutes a Change in Control, then immediately prior to the occurrence of
such a Corporate Transaction, the vesting of all Options issued to Directors
(whether or not employees) shall fully accelerate and all such Options shall
become fully exercisable. As used herein, "Change in Control" shall mean:

                  (i) the shareholders of the Company approve (a) any
consolidation or merger of the Company (x) where the shareholders of the
Company, immediately prior to the consolidation or merger, would not,
immediately after the consolidation or merger, beneficially own, directly or
indirectly, shares representing in the aggregate more than 50% of the combined
voting power of all the outstanding securities of the corporation issuing

                                       17
<PAGE>

cash or securities in the consolidation or merger (or of its ultimate parent
corporation, if any) or (y) where the members of the Board of Directors of the
Company, immediately prior to the consolidation or merger, would not,
immediately after the consolidation or merger, constitute more than 50% of the
board of directors of the corporation issuing cash or securities in the
consolidation or merger (or of its ultimate parent corporation, if any), (b) any
sale, lease, exchange or other transfer (in one transaction or a series of
transactions contemplated or arranged by any party as a single plan) of all or
substantially all of the assets of the Company or (c) any plan or proposal for
the liquidation or dissolution of the Company.

                  (ii) individuals who, as of the date hereof, constitute the
entire Board of Directors of the Company (the "Incumbent Directors") cease for
any reason to constitute at least 50% of the Board, provided that any individual
becoming a director subsequent to the date hereof whose election, or nomination
for election by the Company's shareholders, was approved by a vote of at least a
majority of the then Incumbent Directors shall be, for purposes of this
Agreement, considered as though such individual were an Incumbent Director; or

                  (iii) any "person", as such term is used in Section 13(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act") (other than
the Company, any employee benefit plan of the Company or any entity organized,
appointed or established by the Company for or pursuant to the terms of such
plan), together with all "affiliates" and "associates" (as such terms are
defined in Rule 12b-2 under the Exchange Act) of such person, shall become the
"beneficial owner" or "beneficial owners" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act), directly or indirectly, of securities of the Company
representing in the aggregate 25% or more of either (a) the then outstanding
shares of the Common Stock of the Company or (b) the combined voting power of
all then outstanding securities of the Company having the right under ordinary
circumstances to vote in an election of the Board of Directors of the Company
("Voting Securities") (in either such case, other than as a result of
acquisitions of such securities directly from the Company).

      Notwithstanding the foregoing, a "Change in Control" of the Company shall
not be deemed to have occurred for purposes of the foregoing clause (iii) solely
as the result of an acquisition of securities by the Company which, by reducing
the number of shares of Common Stock or other Voting Securities outstanding,
increases (a) the proportionate number of shares of Common Stock beneficially
owned by any person to 25% or more of the Common Stock then outstanding or (b)
the proportionate voting power represented by the Voting Securities beneficially
owned by any person to 25% or more of the combined voting power of all then
outstanding Voting Securities; provided, however, that if any person referred to
in clause (a) or (b) of this sentence shall thereafter become the beneficial
owner of any additional shares of Common Stock or other Voting Securities (other
than pursuant to a stock split, stock dividend or similar transaction), then a
"Change in Control" shall be deemed to have occurred for purposes of the
foregoing clause (iii).

  With respect to outstanding Stock Grants, the Administrator or the Successor
Board, shall either (i) make appropriate provisions for the continuation of such
Stock Grants by substituting on an equitable basis for the Shares then subject
to such Stock Grants either the consideration

                                       18
<PAGE>

payable with respect to the outstanding Shares of Common Stock in connection
with the Corporate Transaction or securities of any successor or acquiring
entity; or (ii) upon written notice to the Participants, provide that all Stock
Grants must be accepted (to the extent then subject to acceptance) within a
specified number of days of the date of such notice, at the end of which period
the offer of the Stock Grants shall terminate; or (iii) terminate all Stock
Grants in exchange for a cash payment equal to the excess of the Fair Market
Value of the Shares subject to such Stock Grants over the purchase price
thereof, if any. In addition, in the event of a Corporate Transaction, the
Administrator may waive any or all Company repurchase rights with respect to
outstanding Stock Grants.

      C. Recapitalization or Reorganization. In the event of a recapitalization
or reorganization of the Company other than a Corporate Transaction pursuant to
which securities of the Company or of another corporation are issued with
respect to the outstanding shares of Common Stock, a Participant upon exercising
an Option or accepting a Stock Grant after the recapitalization or
reorganization shall be entitled to receive for the purchase price paid upon
such exercise or acceptance of the number of replacement securities which would
have been received if such Option had been exercised or Stock Grant accepted
prior to such recapitalization or reorganization.

      D. Adjustments to Stock-Based Awards. Upon the happening of any of the
events described in Subparagraphs A, B or C above, any outstanding Stock-Based
Award shall be appropriately adjusted to reflect the events described in such
Subparagraphs. The Administrator or the Successor Board shall determine the
specific adjustments to be made under this Paragraph 24, including, but not
limited to the effect if any, of a Change in Control and, subject to Paragraph
4, its determination shall be conclusive.

      E. Modification of ISOs. Notwithstanding the foregoing, any adjustments
made pursuant to Subparagraph A, B or C above with respect to ISOs shall be made
only after the Administrator determines whether such adjustments would
constitute a "modification" of such ISOs (as that term is defined in Section
424(h) of the Code) or would cause any adverse tax consequences for the holders
of such ISOs. If the Administrator determines that such adjustments made with
respect to ISOs would constitute a modification of such ISOs, it may refrain
from making such adjustments, unless the holder of an ISO specifically requests
in writing that such adjustment be made and such writing indicates that the
holder has full knowledge of the consequences of such "modification" on his or
her income tax treatment with respect to the ISO.

25. ISSUANCES OF SECURITIES.

      Except as expressly provided herein, no issuance by the Company of shares
of stock of any class, or securities convertible into shares of stock of any
class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of shares subject to Stock Rights. Except as
expressly provided herein, no adjustments shall be made for dividends paid in
cash or in property (including without limitation, securities) of the Company
prior to any issuance of Shares pursuant to a Stock Right.

                                       19
<PAGE>

26. FRACTIONAL SHARES.

      No fractional shares shall be issued under the Plan and the person
exercising a Stock Right shall receive from the Company cash in lieu of such
fractional shares equal to the Fair Market Value thereof.

27. CONVERSION OF ISOs INTO NON-QUALIFIED OPTIONS; TERMINATION OF ISOs.

      The Administrator, at the written request of any Participant, may in its
discretion take such actions as may be necessary to convert such Participant's
ISOs (or any portions thereof) that have not been exercised on the date of
conversion into Non-Qualified Options at any time prior to the expiration of
such ISOs, regardless of whether the Participant is an employee of the Company
or an Affiliate at the time of such conversion. At the time of such conversion,
the Administrator (with the consent of the Participant) may impose such
conditions on the exercise of the resulting Non-Qualified Options as the
Administrator in its discretion may determine, provided that such conditions
shall not be inconsistent with this Plan. Nothing in the Plan shall be deemed to
give any Participant the right to have such Participant's ISOs converted into
Non-Qualified Options, and no such conversion shall occur until and unless the
Administrator takes appropriate action. The Administrator, with the consent of
the Participant, may also terminate any portion of any ISO that has not been
exercised at the time of such conversion.

28. WITHHOLDING.

      In the event that any federal, state, or local income taxes, employment
taxes, Federal Insurance Contributions Act ("F.I.C.A.") withholdings or other
amounts are required by applicable law or governmental regulation to be withheld
from the Participant's salary, wages or other remuneration in connection with
the exercise or acceptance of a Stock Right or in connection with a
Disqualifying Disposition (as defined in Paragraph 29) or upon the lapsing of
any right of repurchase, the Company may withhold from the Participant's
compensation, if any, or may require that the Participant advance in cash to the
Company, or to any Affiliate of the Company which employs or employed the
Participant, the statutory minimum amount of such withholdings unless a
different withholding arrangement, including the use of shares of the Company's
Common Stock or a promissory note, is authorized by the Administrator (and
permitted by law). For purposes hereof, the fair market value of the shares
withheld for purposes of payroll withholding shall be determined in the manner
provided in Paragraph 1 above, as of the most recent practicable date prior to
the date of exercise. If the fair market value of the shares withheld is less
than the amount of payroll withholdings required, the Participant may be
required to advance the difference in cash to the Company or the Affiliate
employer. The Administrator in its discretion may condition the exercise of an
Option for less than the then Fair Market Value on the Participant's payment of
such additional withholding.

                                       20
<PAGE>

29. NOTICE TO COMPANY OF DISQUALIFYING DISPOSITION.

      Each Employee who receives an ISO must agree to notify the Company in
writing immediately after the Employee makes a Disqualifying Disposition of any
shares acquired pursuant to the exercise of an ISO. A Disqualifying Disposition
is defined in Section 424(c) of the Code and includes any disposition (including
any sale or gift) of such shares before the later of (a) two years after the
date the Employee was granted the ISO, or (b) one year after the date the
Employee acquired Shares by exercising the ISO, except as otherwise provided in
Section 424(c) of the Code. If the Employee has died before such stock is sold,
these holding period requirements do not apply and no Disqualifying Disposition
can occur thereafter.

30. TERMINATION OF THE PLAN.

      The Plan will terminate on January 5, 2016. The Plan may be terminated at
an earlier date by vote of the shareholders or the Board of Directors of the
Company; provided, however, that any such earlier termination shall not affect
any Agreements executed prior to the effective date of such termination.

31. AMENDMENT OF THE PLAN AND AGREEMENTS.

      The Plan may be amended by the shareholders of the Company. The Plan may
also be amended by the Administrator, including, without limitation, to the
extent necessary to qualify any or all outstanding Stock Rights granted under
the Plan or Stock Rights to be granted under the Plan for favorable federal
income tax treatment (including deferral of taxation upon exercise) as may be
afforded incentive stock options under Section 422 of the Code, and to the
extent necessary to qualify the shares issuable upon exercise or acceptance of
any outstanding Stock Rights granted, or Stock Rights to be granted, under the
Plan for listing on any national securities exchange or quotation in any
national automated quotation system of securities dealers. Any amendment
approved by the Administrator which the Administrator determines is of a scope
that requires shareholder approval shall be subject to obtaining such
shareholder approval. Any modification or amendment of the Plan shall not,
without the consent of a Participant, adversely affect his or her rights under a
Stock Right previously granted to him or her. With the consent of the
Participant affected, the Administrator may amend outstanding Agreements in a
manner which may be adverse to the Participant but which is not inconsistent
with the Plan. In the discretion of the Administrator, outstanding Agreements
may be amended by the Administrator in a manner which is not adverse to the
Participant.

32. EMPLOYMENT OR OTHER RELATIONSHIP.

      Nothing in this Plan or any Agreement shall be deemed to prevent the
Company or an Affiliate from terminating the employment, consultancy or director
status of a Participant, nor to prevent a Participant from terminating his or
her own employment, consultancy or director status

                                       21
<PAGE>

or to give any Participant a right to be retained in employment or other service
by the Company or any Affiliate for any period of time.

33. GOVERNING LAW.

      This Plan shall be construed and enforced in accordance with the law of
the State of Delaware.

                                       22

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