Document:

exh10_1assetpurchaseagree.htm

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    

    ______________________________________________________________________________

    

    

    ASSET PURCHASE AGREEMENT

     

    

     

    BY
AND BETWEEN

     

    CRABTREE
ACQUISITION CO, LLC,

     

    ATHEROGENICS,
INC.

     

    AND

     

    KING
& SPALDING LLP

     

    MARCH
17, 2009

    

    

    

    

    ______________________________________________________________________________

    

    

    

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    TABLE OF CONTENTS

     

     

     

      

      
        	
                1.

              	
                DEFINITIONS.

              	
                1

              
	 	 	 
	
                1.1.

              	
                DEFINITIONS

              	
                1

              
	
                1.2.

              	
                CROSS
      REFERENCES

              	
                3

              
	 	 	 
	
                2.

              	
                PURCHASE
      AND SALE

              	
                4

              
	 	 	 
	
                2.1.

              	
                PURCHASE
      AND SALE

              	
                4

              
	
                2.2.

              	
                EXCLUDED
      ASSETS

              	
                5

              
	
                2.3.

              	
                ASSUMED
      LIABILITIES

              	
                6

              
	
                2.4.

              	
                EXCLUDED
      LIABILITIES

              	
                7

              
	
                2.5.

              	
                ASSIGNMENT
      OF CONTRACTS AND RIGHTS.

              	7
	
                2.6.

              	
                PURCHASE
      PRICE; ALLOCATION OF PURCHASE PRICE.

              	8 
      
	
                2.7.

              	
                GOOD
      FAITH DEPOSIT.

              	
                9

              
	
                2.8.

              	
                CLOSING

              	
                9

              
	
                2.9.

              	
                DELIVERIES
      BY SELLER

              	
                9

              
	
                2.10.

              	
                DELIVERIES
      BY PURCHASER

              	
                10

              
	 	 	 
	
                3.

              	
                REPRESENTATIONS
      AND WARRANTIES OF SELLER

              	
                10

              
	 	 	 
	
                3.1.

              	
                ORGANIZATION

              	
                10

              
	
                3.2.

              	
                CORPORATE
      AUTHORIZATION

              	
                11

              
	
                3.3.

              	
                GOVERNMENTAL
      AUTHORIZATION

              	
                11

              
	
                3.4.

              	
                NONCONTRAVENTION

              	
                11

              
	
                3.5.

              	
                REQUIRED
      CONSENTS

              	
                11

              
	
                3.6.

              	
                LITIGATION

              	
                11

              
	
                3.7.

              	
                COMPLIANCE
      WITH LAWS AND COURT ORDERS

              	
                11

              
	
                3.8.

              	
                SUFFICIENCY
      OF AND TITLE TO THE PURCHASED ASSETS.

              	
                12

              
	
                3.9.

              	
                INTELLECTUAL
      PROPERTY RIGHTS.

              	
                12

              
	
                3.10.

              	
                ENVIRONMENTAL
      COMPLIANCE

              	
                13

              
	
                3.11.

              	
                NO
      OTHER AGREEMENTS TO SELL ASSETS

              	
                14

              
	
                3.12.

              	
                CERTAIN
      FEES

              	
                14

              
	
                3.13.

              	
                “AS
      IS” TRANSACTION

              	
                14

              
	 	 	 
	
                4.

              	
                REPRESENTATIONS
      AND WARRANTIES OF PURCHASER

              	
                15

              
	 	 	 
	
                4.1.

              	
                ORGANIZATION

              	
                15

              
	
                4.2.

              	
                AUTHORIZATION

              	
                15

              
	
                4.3.

              	
                GOVERNMENTAL
      AUTHORIZATION

              	
                15

              
	
                4.4.

              	
                NONCONTRAVENTION

              	
                15

              
	
                4.5.

              	
                FINANCING

              	
                15

              
	
                4.6.

              	
                LITIGATION

              	
                16

              
	
                4.7.

              	
                CERTAIN
      FEES

              	
                16

              
	 	 	 
	
                5.

              	
                PRE-CLOSING
      COVENANTS OF SELLER

              	
                16

              
	 	 	 
	
                5.1.

              	
                CONDUCT
      OF THE BUSINESS

              	
                16

              
	
                5.2.

              	
                ACCESS
      TO INFORMATION

              	
                17

              
	
                5.3.

              	
                INSURANCE;
      RISK OF LOSS

              	
                17

              
	
                5.4.

              	
                NOTICES
      OF CERTAIN EVENTS

              	
                17

              
	 	 	 
	
                6.

              	
                PRE-CLOSING
      COVENANTS OF PURCHASER

              	
                18

              
	 	 	 
	
                6.1.

              	
                CONFIDENTIALITY

              	
                18

              
	
                6.2.

              	
                ACCESS

              	
                18

              
	
                6.3.

              	
                INSURANCE

              	
                18

              
	
                6.4.

              	
                ADEQUATE
      ASSURANCE

              	
                18

              

      

       

      
        
          
          

        

        
          
          

          i

        

        
          
          

        

         

      

      
        	 	 	 
	
                7.

              	
                PRE-CLOSING
      COVENANTS OF PURCHASER AND SELLER

              	
                19

              
	 	 	 
	
                7.1.

              	
                EFFORTS;
      FURTHER ASSURANCES

              	
                19

              
	
                7.2.

              	
                CERTAIN
      FILINGS

              	
                19

              
	
                7.3.

              	
                PUBLIC
      ANNOUNCEMENTS

              	
                19

              
	
                7.4.

              	
                BID
      PROCEDURES MOTION AND SALE MOTION.

              	
                19

              
	
                7.5.

              	
                NOTICES

              	
                21

              
	 	 	 
	
                8.

              	
                TAX
      MATTERS.

              	
                21

              
	 	 	 
	
                8.1.

              	
                TAX
      COOPERATION

              	
                21

              
	
                8.2.

              	
                TRANSFER
      TAXES

              	
                21

              
	
                8.3.

              	
                PROPERTY
      TAXES

              	
                21

              
	
                8.4.

              	
                APPORTIONMENT

              	
                21

              
	 	 	 
	
                9.

              	
                EMPLOYEE
      MATTERS

              	
                22

              
	 	 	 
	
                9.1.

              	
                EMPLOYEES
      AND OFFERS OF EMPLOYMENT

              	
                22

              
	
                9.2.

              	
                EMPLOYEE
      RECORDS

              	
                22

              
	
                9.3.

              	
                EMPLOYEE
      PLANS

              	
                22

              
	
                9.4.

              	
                WORKERS’
      COMPENSATION

              	
                22

              
	 	 	 
	
                10.

              	
                CLOSING
      CONDITIONS

              	
                23

              
	 	 	 
	
                10.1.

              	
                CONDITIONS
      TO OBLIGATIONS OF PURCHASER AND SELLER

              	
                23

              
	
                10.2.

              	
                CONDITIONS
      TO OBLIGATIONS OF PURCHASER

              	
                23

              
	
                10.3.

              	
                CONDITIONS
      TO OBLIGATIONS OF SELLER

              	
                23

              
	 	 	 
	
                11.

              	
                SURVIVAL;
      INDEMNIFICATION

              	
                24

              
	 	 	 
	
                11.1.

              	
                SURVIVAL

              	
                24

              
	
                11.2.

              	
                INDEMNIFICATION

              	
                24

              
	 	 	 
	
                12.

              	
                TERMINATION

              	
                24

              
	 	 	 
	
                12.1.

              	
                GROUNDS
      FOR TERMINATION

              	
                24

              
	
                12.2.

              	
                EFFECT
      OF TERMINATION

              	
                25

              
	
                12.3.

              	
                EXPENSES

              	
                25

              
	
                12.4.

              	
                EXCLUSIVE
      REMEDIES

              	
                25

              
	 	 	 
	
                13.

              	
                MISCELLANEOUS.

              	
                25

              
	 	 	 
	
                13.1.

              	
                NOTICES

              	
                25

              
	
                13.2.

              	
                WAIVERS

              	
                26

              
	
                13.3.

              	
                SUCCESSORS
      AND ASSIGNS

              	
                26

              
	
                13.4.

              	
                GOVERNING
      LAW

              	
                27

              
	
                13.5.

              	
                JURISDICTION.

              	
                27

              
	
                13.6.

              	
                WAIVER
      OF JURY TRIAL

              	
                27

              
	
                13.7.

              	
                THIRD
      PARTY BENEFICIARIES

              	
                28

              
	
                13.8.

              	
                ENTIRE
      AGREEMENT; AMENDMENTS; COUNTERPARTS

              	
                28

              
	
                13.9.

              	
                CAPTIONS,
      INTERPRETATION

              	
                28

              

      

      

                                                                       

     

     

    
 

    

    
      
         

      

      
         

        ii

      

      
         

      

    

    ASSET
PURCHASE AGREEMENT

    

    

    THIS ASSET PURCHASE AGREEMENT
dated as of March 16, 2009 (this “Agreement”) is
entered into by and between Crabtree Acquisition Co, LLC, a Delaware limited
liability company (“Purchaser”),
AtheroGenics, Inc., a Georgia corporation (“Seller”), and solely
for the purposes of Section 2.7, King & Spalding LLP, a Georgia limited
liability partnership (“Seller's
Counsel”).  Purchaser and Seller are sometimes individually
referred to in this Agreement as a “Party” and
collectively as the “Parties.”

     

    RECITALS:

     

    WHEREAS, Seller is a
pharmaceutical company engaged in the business of developing and commercializing
pharmaceutical products that treat diabetes and diabetes-related disorders,
cardiovascular and inflammatory diseases (the “Business”);

     

    WHEREAS, Seller desires to
sell, transfer, convey, assign and deliver the Purchased Assets (as defined
below) and to assign the Assumed Liabilities (as defined below), and Purchaser
desires to purchase, take delivery of, and assume such Purchased Assets and
Assumed Liabilities, upon the terms and subject to the conditions set forth
herein;

     

    WHEREAS, Seller is a debtor
and debtor-in-possession in a Chapter 11 bankruptcy case that is pending in the
United States Bankruptcy Court for the Northern District of Georgia, Atlanta
Division (the “Bankruptcy Court”),
under Case No. 08-78200 (the “Bankruptcy Case”);
and

     

    WHEREAS, the transactions
contemplated by this Agreement (the “Transactions”) will
be consummated pursuant to a Sale Order (as defined below) to be entered in the
Bankruptcy Case under Sections 105, 363, 365 and other applicable provisions of
the Bankruptcy Code (as defined below), and the Transactions and this Agreement
are subject to the approval of the Bankruptcy Court.

     

    NOW, THEREFORE, in consideration of
the foregoing and the mutual agreements, covenants, representations, warranties,
and promises set forth herein, and in order to prescribe the terms and
conditions of such purchase and sale, intending to be legally bound, the Parties
agree as follows:

     

    1. Definitions.

     

    1.1. Definitions.  The
following terms, as used herein, have the following meanings:

     

    (a) “Affiliate” means,
with respect to any Person, any other Person directly or indirectly controlling,
controlled by, or under common control with, such other Person.

     

    (b) “Bankruptcy Code”
means Title 11 of the United States Code (11 U.S.C. §101 et seq.), as
amended.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (c) “Business Day” means a
day other than Saturday, Sunday or other day on which commercial banks in
Atlanta, Georgia are authorized or required by law to close.

     

    (d) “Claim” means a
“claim" as defined in Section 101 of the Bankruptcy Code.

     

    (e) “Closing Date” means
the date of the Closing.

     

    (f) “Code” means the
Internal Revenue Code of 1986, as amended.

     

    (g) "Confidentiality
Agreement" means the Confidentiality Agreement dated November 12, 2008,
executed by or on behalf of Purchaser and Seller.

     

    (h) “Cure Costs” means all
amounts that must be paid and all obligations that otherwise must be satisfied,
including pursuant to Sections 365(b)(1) (A) and (B) of the Bankruptcy Code, in
connection with the assumption and/or assignment of the Assumed Contracts,
Chapter 11 Licenses and Intellectual Property Rights to Purchaser as provided
herein.

     

    (i) “Intellectual Property
Right” means any trademark, service mark, trade name, invention (whether
patented or not), U.S. or foreign patent, pending patent application in the U.S.
or foreign jurisdictions, any continuation, divisional or equivalent thereof,
trade secret, copyright, know-how (including any registrations or applications
for registration of any of the foregoing), license agreement (to the extent such
license agreement is transferable) or any other similar type of proprietary
intellectual property right owned by, subject to assignment to, or controlled by
Seller.

     

    (j) “Knowledge of Seller”
or any other similar knowledge qualification in this Agreement means all facts
actually known by the following individuals:  Joseph M. Gaynor, Jr.,
Mark P. Colonnese and Russell M. Medford.

     

    (k) “Lien” means, with
respect to any property or asset, any mortgage, lien, pledge, charge, security
interest or other encumbrance in respect of such property or asset.

     

    (l) “Material Adverse
Effect” means a material adverse effect on the Business and the Purchased
Assets, taken as a whole, excluding any such effect to the extent resulting from
or arising in connection with (i) the Transactions or the public announcement
thereof, (ii) changes or conditions affecting the industry generally in which
Seller operates, (iii) changes in economic, regulatory or political conditions
generally, (iv) changes resulting from the commencement or continuation of the
Bankruptcy Case, (v) actions taken by the Seller pursuant to (or as contemplated
by) orders entered by the Bankruptcy Court in the Bankruptcy Case, or (vi)
changes or conditions affecting the availability, terms or pricing of credit or
equity financing.

     

    (m) “Permitted Liens”
means Liens for Taxes, assessments and similar charges that are not yet due or
are being contested in good faith.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (n) “Person” means an
individual, corporation, partnership, limited liability company, association,
trust or other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof.

     

    (o) “Petition Date” means
October 15, 2008.

     

    (p) “Pre-Closing Tax
Period” means (i) any Tax period ending on or before the Closing Date,
and (ii) with respect to a Tax period that commences before but ends after the
Closing Date, the portion of such period up to and including the Closing
Date.

     

    (q) “Property Taxes” means
all real property Taxes, personal property Taxes and similar ad valorem
obligations levied with respect to the Purchased Assets for any Taxable
period.

     

    (r) “Tax” means (i) any
tax, governmental fee or other like assessment or charge of any kind whatsoever
(including withholding on amounts paid to or by any Person), together with any
interest, penalty, addition to tax or additional amount imposed by any
governmental authority (a “Taxing Authority”)
responsible for the imposition of any such tax (domestic or foreign), or (ii)
liability for the payment of any amounts of the type described in (i) as a
result of being party to any agreement or any express or implied obligation to
indemnify any other Person.

     

    1.2. Cross
References.  Each of the following terms is defined in the
Section set forth opposite such term:

     

    
      	
              Term

            	
              Section

            
	
              Accounts
      Receivable

            	
              2.1(e)

            
	
              Acquired
      Intellectual Property Right

            	
              2.1(g)

            
	
              Agreement

            	
              Preamble

            
	
              Apportioned
      Obligations

            	
              8.3

            
	
              Assignment
      and Assumption Agreement

            	
              2.9(a)

            
	
              Assumed
      Contracts

            	
              2.1(c)

            
	
              Assumed
      Liabilities

            	
              2.3

            
	
              Bankruptcy
      Case

            	
              Recitals

            
	
              Bankruptcy
      Court

            	
              Recitals

            
	
              Business

            	
              Recitals

            
	
              Chapter
      11 Contracts

            	
              2.1(c)

            
	
              Chapter
      11 Licenses

            	
              2.1(d)

            
	
              Closing

            	
              2.8

            
	
              COBRA
      Beneficiaries

            	
              9.3(b)

            
	
              COBRA
      Coverage

            	
              9.3(b)

            
	
              End
      Date

            	
              12.1(e)

            
	
              Environmental
      Laws

            	
              3.10(d)

            
	
              Excluded
      Assets

            	
              2.2

            
	
              Excluded
      Liabilities

            	
              2.4

            
	
              Good
      Faith Deposit

            	
              2.7
      (a)

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
      	
              Hazardous
      Materials

            	
              3.10(e)

            
	
              Inventory

            	
              2.1(a)

            
	
              Party

            	
              Preamble

            
	
              Parties

            	
              Preamble

            
	
              Post-Closing
      Tax Period

            	
              8.3

            
	
              Post-Petition
      Contracts

            	
              2.1(b)

            
	
              Purchase
      Price

            	
              2.6(a)

            
	
              Purchased
      Assets

            	
              2.1

            
	
              Purchaser

            	
              Preamble

            
	
              Required
      Consents

            	
              3.5

            
	
              Restricted
      Purchased Asset

            	
              2.5(c)

            
	
              Sale
      Motion

            	
              7.4(a)

            
	
              Sale
      Order

            	
              7.4(a)

            
	
              Seller

            	
              Preamble

            
	
              Seller's
      Counsel

            	
              Preamble

            
	
              Taxing
      Authority

            	
              1.1(v)

            
	
              Transactions

            	
              Recitals

            
	
              Transfer
      Taxes

            	
              8.2

            
	
              Transferred
      Employees

            	
              9.1(a)

            
	
              Transferred
      Employees' Employment Date

            	
              9.4

            

    

    

    2. Purchase and
Sale

     

    2.1.            Purchase and
Sale.  Subject to the terms and conditions set forth in this
Agreement, at the Closing, Seller agrees to sell, transfer and deliver to
Purchaser, and Purchaser agrees to purchase, acquire and accept from Seller, all
right, title and interest of Seller as of the Closing Date in and to the
following assets, properties and rights (the “Purchased Assets”),
to the extent owned, held or primarily used in the conduct of the Business, free
and clear of all Liens and Claims (other than Permitted Liens and the Assumed
Liabilities) and to the extent that such assets are not excluded pursuant to
Section
2.2:

     

    (a) all
inventory (including raw materials, work in process, and finished goods) and
supplies, including all experimental drug products, placebos, comparator drug
products, retained plasma samples, and stability samples (collectively, the
“Inventory”);

     

    (b) all
contracts, agreements, leases, commitments, and orders of Seller, in each case
executed or entered into after the Petition Date and all contracts, agreements,
leases, commitments, and orders of Seller entered into from and after the date
of this Agreement and prior to Closing and, in each case, including those that
are set forth on Schedule 2.1(b)
(collectively, the “Post-Petition
Contracts”);

     

    (c) the
executory contracts and unexpired leases of Seller that were executed or entered
into on or prior to the Petition Date and that are set forth on Schedule 2.1(c) (the
“Chapter 11
Contracts”; the Post-Petition Contracts and the Chapter 11 Contracts are
referred to collectively as the “Assumed
Contracts”);

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (d) all
transferable licenses, permits or other governmental authorizations of Seller
(“Chapter 11
Licenses”);

     

    (e) except as
provided in Section 2.2(i), all accounts receivable (the “Accounts
Receivable”);

     

    (f) all
machinery, equipment (including computer and office equipment, office supplies
and laboratory equipment), furniture, furnishings, and other items of tangible
personal property, including the items listed on Schedule
2.1(f);

     

    (g) all
Intellectual Property Rights, including the items listed on Schedule 2.1(g) (the
"Acquired Intellectual
Property Rights");

     

    (h) all
research and development records and reports, product stability protocols and
data, clinical protocols, case report forms (including case report forms for
individual patients), statistical plans, clinical study reports and analyses,
regulatory records, investigational new drug (ind) application documentation,
correspondence with investigators and regulators, and related
materials;

     

    (i) all
books, records, files and papers of Seller relating to the Business or the
Purchased Assets, excluding employee records of Seller's employees that are not
Transferred Employees; and

     

    (j) except as
provided in Section
2.2(b), all insurance claims arising from or relating to the Purchased
Assets prior to the Closing Date, and all claims of Seller against third parties
relating to the Purchased Assets, whether choate or inchoate, known or unknown,
contingent or non contingent.

     

    2.2. Excluded
Assets.  Notwithstanding any other provision of this Agreement
to the contrary, the Purchased Assets shall not include any assets, properties
or rights not specifically identified in Section 2.1, including the following
(the “Excluded
Assets”):

     

    (a) all of
Seller’s cash and cash equivalents on hand (including all undeposited checks)
and in banks or other financial institutions and all of Seller’s short-term
investments, including commercial paper, corporate notes and government agency
notes;

     

    (b) all
preference claims, fraudulent transfer claims, avoidance actions or other causes
of action, whether arising under the Bankruptcy Code or otherwise, and the
proceeds thereof, including actions available to Sellers under Section 510 or
under any of Sections 542 through 553 of the Bankruptcy Code, of whatever kind
or nature, and whether asserted or unasserted;

     

    (c) the
minute books and organizational documents of Seller;

     

    (d) any
unexpired lease or executory contract that is identified on Schedule 2.2(d) or
that is not identified in this Agreement as an Assumed Contract;

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (e) all
insurance policies relating to the Business and all claims arising under such
policies prior to the Closing, and all credits, premium refunds, proceeds,
causes of action or rights thereunder, in each case, other than those claims
arising prior to Closing that arise from or relate to the Purchased
Assets;

     

    (f) all
rights of Seller arising under this Agreement or in connection with the
Transactions;

     

    (g) any
Purchased Asset sold or otherwise disposed of pursuant to Section 5.1(b) prior
to the Closing Date;

     

    (h) any Tax
refund or reimbursement due to Seller or its Affiliates and relating to the
Business;

     

    (i) all
accounts, notes and other receivables and amounts owed to the Seller by any one
or more of Seller’s Affiliates or employees;

     

    (j) all
utility deposits, security deposits and other deposits of any kind or nature
whatsoever;

     

    (k) all
fixtures currently owned or leased by Seller; and

     

    (l) Employee
records of any Seller employee who is not a Transferred Employee.

     

    At any
time prior to Closing, Purchaser may, in its sole discretion, by written notice
to Seller, elect not to acquire and assume one or more Purchased
Assets.  In such event, the applicable schedule, if any, shall be
deemed to be amended without further action by either Party and such Purchased
Assets shall be considered Excluded Assets for all purposes
hereunder.

     

    2.3. Assumed
Liabilities.  Upon the terms and subject to the conditions of
this Agreement, Purchaser agrees, effective at the time of the Closing, to
assume, pay, perform and discharge, promptly when payment or performance is due
or required, the following liabilities and obligations of Seller or the Business
(the “Assumed
Liabilities”):

     

    (a) all
liabilities and obligations of Seller related to or arising under the Assumed
Contracts, Chapter 11 Licenses and Intellectual Property Rights from and
after the Closing;

     

    (b) all Cure
Costs;

     

    (c) all
Apportioned Obligations of Purchaser;

     

    (d) any and
all costs and expenses necessary in connection with providing “adequate
assurance of future performance” with respect to the Assumed Contracts (as
contemplated by Section 365 of the Bankruptcy Code);

     

    (e) all
Transfer Taxes; and

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    (f) all
liabilities relating to or arising from the operation of the Business or the
ownership of the Purchased Assets by Purchaser from and after the Closing,
including all amounts due and owing to foreign patent agents with respect to
services provided from and after the Closing.

     

    From and
after the Closing, Purchaser shall indemnify the Seller with respect to any
claims or liabilities relating to, and hold the Seller harmless from, the
Assumed Liabilities.

     

    2.4. Excluded
Liabilities.  Notwithstanding any other provision of this
Agreement to the contrary, Purchaser is assuming only the Assumed Liabilities
and is not assuming any other liability or obligation of Seller of whatever
nature, whether presently in existence or arising hereafter.  All such
other liabilities and obligations shall be retained by and remain obligations
and liabilities of Seller (all such liabilities and obligations not being
assumed being herein referred to as the “Excluded
Liabilities”).

     

    2.5. Assignment of Contracts and
Rights.

     

    (a) To the
maximum extent permitted by the Bankruptcy Code, the Assumed Contracts and
Intellectual Property Rights shall be assumed by Seller and assigned to
Purchaser at the Closing pursuant to Sections 105, 363 and/or 365 of the
Bankruptcy Code.  Notwithstanding any other provision of this
Agreement to the contrary, this Agreement shall not constitute an agreement to
assign any Purchased Asset or any right thereunder if an attempted assignment,
without the consent of a third party, would constitute a breach or in any way
adversely affect the rights of Purchaser or Seller thereunder.

     

    (b) If
required by applicable law or the terms thereof to validly assign any Assumed
Contract or Intellectual Property Right without breach or violation thereof,
Seller agrees to use commercially reasonable efforts to obtain the consent of
each other party to any such Assumed Contract or Intellectual Property Right
prior to the Closing; provided, however, that no modification of any such
Assumed Contract or Intellectual Property Right shall be made without
Purchaser's prior written consent and the form of the consent to assignment
shall be subject to the prior written approval of Purchaser (which shall not be
withheld unreasonably).

     

    (c) If there
are any Required Consents that have not yet been obtained (or otherwise are not
in full force and effect) as of the Closing, in the case of each Assumed
Contract or Intellectual Property Right as to which such Required Consent was
not obtained (or otherwise are not in full force and effect) (each, a "Restricted Purchased
Asset"), Purchaser may, but shall not be required to, waive the closing
conditions as to any such Required Consent and either:  (i) elect to
have Seller continue to use its commercially reasonable efforts to obtain the
Required Consent; or (ii) elect to have Seller retain that Restricted Purchased
Asset and all liabilities arising therefrom or relating thereto (without any
adjustment to the Purchase Price).  If Purchaser elects to have Seller
continue its commercially reasonable efforts to obtain any Required Consent and
the Closing occurs, notwithstanding this Agreement, neither this Agreement nor
the Assignment and Assumption Agreement nor any other document related to the

    
      
        
        

      

      
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      consummation
of the transactions contemplated by this Agreement shall constitute a sale,
assignment, assumption, transfer, conveyance or delivery or an attempted sale,
assignment, assumption, transfer, conveyance or delivery of any Restricted
Purchased Asset, and following the Closing, the parties shall use their
respective commercially reasonable efforts, and cooperate with each other, to
obtain the Required Consent relating to each Restricted Purchased Asset as
quickly as practicable; provided, however, that the payment of money by
Purchaser shall not be required in connection therewith.  Prior to the
obtaining of such Required Consents, the parties shall cooperate with each other
in any reasonable and lawful arrangements designed to provide to Purchaser the
benefits of use of any and all Restricted Purchased Asset for their respective
terms (or any right or benefit arising thereunder, including the enforcement for
the benefit of Purchaser of any and all rights of Seller against a third party
thereunder).  When a Required Consent for the sale, assignment,
assumption, transfer, conveyance and delivery of a Restricted Purchased Asset is
obtained, Seller shall promptly assign, transfer, convey and deliver such
Restricted Purchased Asset to Purchaser, and Purchaser shall assume the
obligations under such Restricted Purchased Asset assigned to Purchaser from and
after the date of assignment to Purchaser pursuant to an assignment and
assumption agreement substantially similar in terms and conditions set forth in
the Assignment and Assumption Agreement (which agreement the Parties shall
prepare, execute and deliver in good faith at the time of such transfer, all at
no additional cost to Purchaser).

    

     

    2.6.            Purchase Price; Allocation
of Purchase Price.

     

    (a) In
addition to the assumption of the Assumed Liabilities, in consideration for the
sale, transfer and delivery of the Purchased Assets, at the Closing, Purchaser
shall deliver to Seller Two Million Dollars ($2,000,000.00) (the “Purchase Price”) by
wire transfer of immediately available federal funds to a bank account (or
accounts) as shall be designated in writing no later than one (1) day prior to
the Closing Date by Seller to Purchaser, which amount shall be reduced by the
amount of the Good Faith Deposit disbursed to Seller as a credit against the
Purchase Price in accordance with Section 2.7(b)(i).

     

    (b) Purchaser and Seller agree that the Purchase Price, applicable Assumed
Liabilities and other relevant items shall be allocated in accordance with
Section 1060 of the Code and the regulations thereunder and Schedule 2.6 hereof
(such schedule to be determined jointly by Purchaser and Seller prior to
Closing).  Purchaser and Seller each agrees to provide the other
promptly with any other information required to complete Schedule
2.6.  Such allocation shall be binding on Purchaser and Seller
for all purposes including the reporting of gain or loss and determination of
basis for income tax purposes, and each of the parties hereto agrees that it
will file a statement (on IRS Form 8594 or other applicable form) setting forth
such allocation with its federal and applicable state income tax returns and
will also file such further information or take such further actions as may be
necessary to comply with the Treasury Regulations that have been promulgated
pursuant to Section 1060 of the Code and similar applicable state laws and
regulations.

     

    
      
        
        

      

      
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    2.7.            Good Faith
Deposit.

     

    (a) Simultaneously
with the execution of this Agreement, Purchaser shall deposit with Seller’s
Counsel cash in immediately available federal funds by wire transfer to an
account or accounts designated by Seller’s Counsel, an amount equal to Two
Hundred Thousand Dollars ($200,000.00) (the “Good Faith Deposit”),
to be held in escrow by Seller's Counsel in a non-interest bearing account until
applied as provided in Section 2.7(b).

     

    (b) Seller's
Counsel shall deliver the Good Faith Deposit to the Seller only upon the
happening of any of the following:  (i) at the Closing as a credit
against the Purchase Price, or (ii) upon the termination of this Agreement
pursuant to Section 12.1(h) by Seller due to any of the conditions of Section
10.3 not being satisfied.  Seller's Counsel shall return the Good
Faith Deposit to Purchaser if the Agreement is terminated pursuant to Sections
12.1(a), (b), (c), (d), (e), (f) or (i), or if the Agreement is terminated
pursuant to Section 12.1(g) by Purchaser due to any of the conditions of Section
10.2 not being satisfied.

     

    2.8.            Closing.  Subject
to the satisfaction of the conditions set forth in Section 10 (other than those
requiring a delivery, or the taking of other action, at the Closing), the
closing (the “Closing”) of the
purchase and sale of the Purchased Assets and the assumption of the Assumed
Liabilities shall take place at the offices of King & Spalding LLP, 1180
Peachtree Street, Atlanta, Georgia, on the third (3rd)
Business Day following entry of the Sale Order or at such other time or place as
Purchaser and Seller may agree.  The Closing shall be effective at
12:01 a.m. (local time in Atlanta, Georgia) on the Closing
Date.

     

    2.9. Deliveries by
Seller.  At the Closing, Seller will deliver or cause to be
delivered to Purchaser (unless delivered previously) the following:

     

    (a) a Bill of
Sale, Assignment and Assumption Agreement substantially in the form attached
hereto as Exhibit
A (the “Assignment and Assumption
Agreement”), duly executed by Seller;

     

    (b) a
recordable assignment of all patents and patent applications that constitute
Acquired Intellectual Property Rights, duly executed by Seller;

     

    (c) a copy of
the Sale Order, certified by the clerk of the Bankruptcy Court;

     

    (d) a copy of
each Required Consent;

     

    (e) a
certificate duly executed by the Seller certifying as to the matters set forth
in Section 10.2;

     

    (f) a
certificate duly executed by Seller acknowledging delivery by Purchaser of the
items set forth in Section 2.10;

     

    
      
        
        

      

      
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    (g) evidence
of the releases of any and all Liens on the Purchased Assets (other than
Permitted Liens and Assumed Liabilities), each in form and substance
satisfactory to Purchaser in its reasonable discretion; and

     

    (h) all other
documents, instruments and writings reasonably requested by Purchaser to be
delivered by Seller at or prior to the Closing pursuant to this
Agreement.

     

    2.10. Deliveries by
Purchaser.  At the Closing, Purchaser will deliver or cause to
be delivered to Seller (unless previously delivered) the following:

     

    (a) the
Purchase Price less the Good Faith Deposit;

     

    (b) the
Assignment and Assumption Agreement, duly executed by Purchaser;

     

    (c) a
Certificate of Good Standing of Purchaser issued by the Secretary of State of
the State of Delaware dated within thirty (30) calendar days of the Closing
Date;

     

    (d) a copy of
resolutions adopted by the manager of Purchaser authorizing and approving the
execution and delivery of this Agreement and all agreements and other documents
and instruments contemplated hereby and thereby and the consummation of the
transactions contemplated hereby and thereby, certified to be true, complete,
correct and in full force and effect as of the Closing Date by the Secretary of
Purchaser;

     

    (e) a copy of
the certificate of formation of Purchaser, including all amendments thereto,
certified by the Secretary of State of the State of Delaware dated as of a date
within thirty (30) days of Closing and certified as true, complete and correct
and in full force and effect as of the Closing Date by the Secretary of
Purchaser, and a copy of the limited liability company agreement of Purchaser,
including all amendments thereto, certified as true, complete and correct and in
full force and effect as of the Closing Date by the Secretary of
Purchaser;

     

    (f) a
certificate duly executed by the Secretary of Purchaser certifying as to the
matters set forth in Section 10.3;

     

    (g) a
certificate duly executed by Purchaser acknowledging delivery by Seller of the
items set forth in Section 2.9; and

     

    (h) all other
documents, instruments and writings reasonably requested by Seller to be
delivered by Purchaser at or prior to the Closing pursuant to this
Agreement.

     

    3. Representations
and Warranties of Seller.  Subject to the terms, conditions and
limitations set forth in this Agreement, Seller hereby represents and warrants
to Purchaser as follows:

     

    3.1. Organization.  Seller
is a corporation validly existing under the laws of the State of Georgia, and
Seller has the corporate power and authority to own, lease and operate the
Purchased Assets and to carry on in all material respects the Business as now
being conducted.

     

    
      
        
        

      

      
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    3.2. Corporate
Authorization.  The execution, delivery and performance by
Seller of this Agreement and the consummation of the Transactions are within
Seller’s corporate powers and have been duly authorized by all necessary action
on the part of Seller.  Subject to entry by the Bankruptcy Court of
the Sale Order in the Bankruptcy Case, this Agreement constitutes a valid and
binding agreement of Seller that is enforceable in accordance with its
terms.

     

    3.3. Governmental
Authorization.  Except as disclosed in Schedule 3.3, the execution,
delivery and performance by Seller of this Agreement and the consummation of the
transactions contemplated hereby by Seller require no action by or in respect
of, or filing with, any governmental body, agency or official other than (a)
consents, approvals or authorizations of, or declarations or filings with, the
Bankruptcy Court, and (b) any such action or filing as to which the failure to
make or obtain would not have a Material Adverse Effect.

     

    3.4. Noncontravention.  Subject
to entry by the Bankruptcy Court of the Sale Order in the Bankruptcy Case, the
execution, delivery and performance by Seller of this Agreement and the
consummation of the Transactions do not and will not (a) violate Seller’s
articles or certificate of incorporation, as amended, or bylaws, (b) assuming
compliance with the matters referred to in Section 3.3, materially violate any
applicable law, rule, regulation, judgment, injunction, order or decree, (c)
except as to matters which would not reasonably be expected to have a Material
Adverse Effect, constitute a default under, violation of or give rise to any
right of termination, cancellation or acceleration of any right or obligation or
to a loss of any benefit relating to any Purchased Asset to which Seller is
entitled under any provision of any agreement or other instrument binding upon
Seller except for breaches and defaults referred to in Section 365(b)(2) of the
Bankruptcy Code, (d) result in the creation or imposition of any Lien on any
Purchased Asset (other than Liens that will be released at or prior to Closing
by virtue of entry of the Sale Order), or (e) cause Purchaser to become subject
to, or to become liable for the payment of, any Tax or other liability that is
not an Assumed Liability.

     

    3.5. Required
Consents.  Except for consents, approvals or authorizations of,
or declarations or filings with, the Bankruptcy Court, and except as otherwise
set forth on Schedule
3.5 (the “Required Consents”),
there is no agreement or other instrument binding upon Seller requiring a
consent or other action by any Person as a result of the execution, delivery and
performance of this Agreement, except such consents or actions as would not,
individually or in the aggregate, have a Material Adverse Effect if not received
or taken by the Closing Date.

     

    3.6. Litigation.  Except
as disclosed in Schedule 3.6, as of the date
hereof, there is no action, suit, investigation or proceeding pending against,
or to the Knowledge of Seller, threatened against or affecting, the Purchased
Assets before any court or arbitrator or any governmental body, agency or
official which is reasonably likely to have a Material Adverse Effect or which
in any manner challenges or seeks to prevent, enjoin, alter or materially delay
the Transactions.

     

    3.7. Compliance with Laws and
Court Orders.  To the Knowledge of Seller, Seller is not in
violation of any law, rule, regulation, judgment, injunction, order or decree
applicable to the Purchased Assets or the conduct of the Business, except for
violations which would not reasonably be expected to have a Material Adverse
Effect.

     

    
      
        
        

      

      
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    3.8. Sufficiency of and Title to
the Purchased Assets.

     

    (a) The
Purchased Assets constitute all of the material property and assets owned, held
or primarily used in the conduct of the Business (other than the Excluded
Assets).

     

    (b) Seller
has good title to all of the Purchased Assets.  Upon the Sale Order
having been entered by the Bankruptcy Court and in accordance with the terms of
the Sale Order, (i) subject to Section 2.5, Seller
will have complete and unrestricted power and the unqualified right to sell,
convey, assign, transfer and deliver the Purchased Assets to Purchaser, and (ii)
the Assignment and Assumption Agreement to be executed by Seller and delivered
to Purchaser at the Closing shall be valid and binding obligations of Seller,
enforceable in accordance with its terms and shall effectively vest in Purchaser
good and marketable title to the Purchased Assets, free and clear of all Liens
and Claims other than Assumed Liabilities and Permitted Liens.

     

    3.9. Intellectual Property
Rights.  Except as set forth on Schedule
3.9:

     

    (a) Schedule 2.1(g)
contains a complete and accurate list of all of the Intellectual Property Rights
owned (in whole or in part) or licensed by Seller which are being acquired by
Purchaser.  To the Seller’s Knowledge, all of the Acquired
Intellectual Property Rights listed on Schedule 2.1(g) are
in good standing and, to the extent applicable, are duly authorized, validly
issued and enforceable and have not been cancelled.

     

    (b) Seller is
the owner or exclusive licensee of all right, title and interest in and to each
of the Acquired Intellectual Property Rights, free and clear of all Liens (other
than Permitted Liens), except as such rights may be limited as set forth on
Schedule
3.9(b).  To the Seller’s Knowledge, Seller's conduct of the
Business does not infringe any of the intellectual property assets or other
proprietary right of any Person.  Except as set forth on Schedule 3.9(b),
(i) there are no licenses now outstanding or other rights granted to any
Person with respect to any of the Acquired Intellectual Property Rights;
(ii) Seller is not a party to any contract or agreement with respect to any
of the Acquired Intellectual Property Rights; and (iii)  Seller has not
received any written notice or other written communication asserting that Seller
has infringed, misappropriated or otherwise made any unlawful or unauthorized
use of any of its Acquired Intellectual Property Rights, and, to Seller's
Knowledge, there is no basis for any such claim.  To Seller's
Knowledge, no third party is infringing any of Seller's rights in any of its
Acquired Intellectual Property Rights.  

     

    (c) Upon
consummation of the transactions contemplated by this Agreement, Purchaser shall
receive Seller’s complete right, title and interest in and to all tangible and
intangible property rights existing in the Acquired Intellectual Property
Rights.  

     

    (d) Seller is
not in default with respect to any order, writ, judgment, award, injunction or
decree of any governmental entity or regulatory authority or 

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        
     arbitrator applicable to the Acquired
Intellectual Property Right or Seller's activities in connection
therewith.

    

     

    (e) Seller
has not agreed to indemnify any Person against any charge of infringement or
other violation with respect to any of the Acquired Intellectual Property
Rights.

     

    (f) Seller
has the right, which is non-terminable and not subject to expiration or
revocation, to develop, license, control, regulate the use of or otherwise
exploit the Acquired Intellectual Property Rights without any valid legal or
equitable claim by, or payment or other obligation owing to, or required consent
from, any Person.

     

    3.10. Environmental
Compliance.  Except as set forth on Schedule
3.10:

     

    (a) Seller
has obtained and is in material compliance with all permits, approvals, licenses
and authorizations required under any Environmental Laws to operate the
Business.  Seller has not received any written notice or been cited
for any violation or potential violation of any such permit, approval, license
or authorization by any governmental entity that would result in material
liability.

     

    (b) Seller is
in material compliance, and has at all times complied in all material respects,
with all Environmental Laws, and Seller has not received any written notice or
been cited for any violation or potential violation of any such Environmental
Laws.  To Seller’s Knowledge, no capital expenditures by Seller or
Purchaser (following the Closing Date) shall be required to establish or
maintain compliance with any applicable Environmental Laws.  To
Seller’s Knowledge, there is no pending investigation, civil, criminal or
administrative action, written notice or demand letter, notice of violation or
other proceeding by any governmental entity with respect to ground or surface
water, soil or air contamination, the storage, treatment, release,
transportation or disposal of Hazardous Materials.  Seller has not
received any written notice or other written communication concerning any past,
present or future events, actions or conditions which may give rise to any
liability of Seller or Purchaser (following the Closing Date) relating to the
presence of Hazardous Materials on any real property owned or leased by
Seller.  Seller has no agreement with any governmental entity relating
to any such environmental matter or any environmental or Hazardous Materials
cleanup.

     

    (c) As used
in this Agreement, "Environmental Laws"
shall mean all federal, state, local and foreign laws and regulations relating
to pollution or protection of human health or the environment (including ambient
air, surface, water, ground water, land surface or subsurface strata), including
laws and regulations relating to emissions, discharges, releases or threatened
releases of Hazardous Materials or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of Hazardous Materials.

     

    (d) As used
in this Agreement, "Hazardous Materials"
means any pollutants, contaminants, by-products, wastes, dangerous, toxic or
hazardous substances, constituents, compounds or chemicals (including petroleum
or any by-products or 

     

    
      
        
        

      

      
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          fractions
thereof, any form of natural gas, lead, asbestos and asbestos-containing
materials, polychlorinated biphenyls ("PCBs"), radon and
other pesticides, explosives, flammables, corrosives and urea formaldehyde foam)
that

          are regulated
by, or may form the basis of liability under, any Environmental Law and includes
the meanings of all such terms in or under any Environmental
Law.

    

     

    3.11. No Other Agreements to Sell
Assets.  Seller has no obligation, absolute or contingent, to
any Person (other than Purchaser) to sell any of the Purchased Assets, or to
effect any merger, consolidation or other reorganization of Seller, or to enter
into any agreement with respect thereto.

     

    3.12. Certain
Fees.  Except for the fees and expenses of Merriman, Curhan,
Ford & Co., Seller has not incurred
any liability for any investment banking fees, financial advisory fees,
brokerage fees, finders’ fees, or other similar fees in connection with this
Agreement or the Transactions.  Purchaser shall have no responsibility
to satisfy any liability of the Seller for any of the fees described in this
Section
3.12.

     

    3.13. “AS IS”
TRANSACTION.  PURCHASER HEREBY ACKNOWLEDGES AND AGREES THAT,
NOTWITHSTANDING THE REPRESENTATIONS AND WARRANTIES EXPRESSLY PROVIDED IN THIS
SECTION 3, THE CONSENT OF A PARTY TO THE CLOSING SHALL CONSTITUTE A WAIVER BY
SUCH PARTY OF ANY CONDITIONS TO CLOSING NOT SATISFIED AS OF THE CLOSING DATE,
AND FOLLOWING CLOSING SELLER MAKES NO REPRESENTATIONS OR WARRANTIES WHATSOEVER,
EXPRESS OR IMPLIED, WITH RESPECT TO ANY MATTER RELATING TO THE PURCHASED ASSETS,
INCLUDING INCOME TO BE DERIVED OR EXPENSES TO BE INCURRED IN CONNECTION WITH THE
PURCHASED ASSETS, THE PHYSICAL CONDITION OF ANY PROPERTY COMPRISING A PART OF
THE PURCHASED ASSETS OR WHICH IS THE SUBJECT OF ANY LEASE OR CONTRACT TO BE
ASSIGNED TO PURCHASER AT THE CLOSING, THE ENVIRONMENTAL CONDITION OR ANY OTHER
MATTER RELATING TO THE PHYSICAL CONDITION OF ANY REAL PROPERTY OR IMPROVEMENTS,
THE ZONING OF ANY SUCH REAL PROPERTY OR IMPROVEMENTS, THE VALUE OF THE PURCHASED
ASSETS (OR ANY PORTION THEREOF), THE TRANSFERABILITY OF THE PURCHASED ASSETS,
THE TERMS, AMOUNT, VALIDITY OR ENFORCEABILITY OF ANY ASSUMED LIABILITIES, THE
TITLE OF THE PURCHASED ASSETS (OR ANY PORTION THEREOF), THE MERCHANTABILITY OR
FITNESS OF THE PERSONAL PROPERTY OR ANY OTHER PORTION OF THE PURCHASED ASSETS
FOR ANY PARTICULAR PURPOSE, OR ANY OTHER MATTER OR THING RELATING TO THE
PURCHASED ASSETS OR ANY PORTION THEREOF.  WITHOUT IN ANY WAY LIMITING
THE FOREGOING, SELLER HEREBY DISCLAIMS ANY WARRANTY, EXPRESS OR IMPLIED, OF
MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE AS TO ANY PORTION OF THE
PURCHASED ASSETS.  PURCHASER FURTHER ACKNOWLEDGES THAT PURCHASER HAS
CONDUCTED AN INDEPENDENT INSPECTION AND INVESTIGATION OF THE PHYSICAL CONDITION
OF THE PURCHASED ASSETS AND ALL SUCH OTHER MATTERS RELATING TO OR AFFECTING THE
PURCHASED ASSETS AS PURCHASER DEEMED NECESSARY OR APPROPRIATE AND THAT IN
PROCEEDING WITH ITS ACQUISITION OF THE 

     

    
      
        
        

      

      
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PURCHASED
ASSETS, EXCEPT FOR ANY REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN
SECTION 3, PURCHASER IS DOING SO BASED SOLELY UPON SUCH INDEPENDENT INSPECTIONS
AND INVESTIGATIONS.  ACCORDINGLY, UPON THE CLOSING DATE, PURCHASER
WILL ACCEPT THE PURCHASED ASSETS AT THE CLOSING “AS IS,” “WHERE IS,” AND “WITH
ALL FAULTS.”  

    

     

    4. Representations
and Warranties of Purchaser.  Purchaser represents and warrants
to Seller as follows:

     

    4.1. Organization.  Purchaser
is a limited liability company duly organized, validly existing and in good
standing under the laws of the State of Delaware and has all company powers and
all material governmental licenses, authorizations, permits, consents and
approvals required to carry on its business as now conducted.

     

    4.2. Authorization.  The
execution, delivery and performance by Purchaser of this Agreement and the
consummation of the Transactions are within the company powers of Purchaser and
have been duly authorized by all necessary action on the part of
Purchaser.  This Agreement constitutes a valid and binding agreement
of Purchaser that is enforceable in accordance with its terms.

     

    4.3. Governmental
Authorization.  The execution, delivery and performance by
Purchaser of this Agreement and the consummation of the Transactions by
Purchaser require no action by or in respect of, or filing with, any
governmental body, agency or official other than (i) consents, approvals or
authorizations of, or declarations or filings with, the Bankruptcy Court, and
(ii) any such action or filing as to which the failure to make or obtain would
not have a material adverse effect on the Purchaser or its ability to close the
Transactions.

     

    4.4.            Noncontravention.  Neither
the execution and delivery of this Agreement nor the consummation of the
Transactions will (a) conflict with or result in any breach of any provision of
the articles or certificate of incorporation of Purchaser; (b) require any
filing with, or the obtaining of any permit, authorization, consent or approval
of, any governmental entity; (c) violate, conflict with or result in a default
(or any event which, with notice or lapse of time or both, would constitute a
default) under, or give rise to any right of termination, cancellation or
acceleration under, any of the terms, conditions or provisions of any note,
mortgage, other evidence of indebtedness, guarantee, license, agreement, lease
or other contract, instrument or obligation to which Purchaser is a party or by
which Purchaser or any of its assets may be bound; or (d) violate any law,
order, injunction or decree applicable to Purchaser, excluding from the
foregoing clauses (b), (c) and (d) such requirements, violations, conflicts,
defaults or rights (i) which would not materially and adversely affect the
ability of Purchaser to consummate the Transactions, or (ii) which become
applicable as a result of any acts or omissions by, or the status of or any
facts pertaining to, Seller.

     

    4.5.            Financing.  Purchaser
has sufficient cash, available lines of credit or other sources of immediately
available funds to enable it to make payment of the Purchase Price and any other
amounts to be paid by it hereunder.

     

    
      
        
        

      

      
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    4.6. Litigation.  There
is no action, suit, investigation or proceeding pending against or, to the
knowledge of Purchaser, threatened against or affecting Purchaser before any
court or arbitrator or any governmental body, agency or official which in any
manner challenges or seeks to prevent, enjoin, alter or materially delay the
Transactions.

     

    4.7. Certain
Fees.  Purchaser has not employed any broker, finder,
investment banker, or other intermediary or incurred any liability for any
investment banking fees, financial advisory fees, brokerage fees, finders’ fees,
or other similar fees in connection with this Agreement or the
Transactions.

     

    4.8. Inspections; No Other
Representations.  Purchaser is an informed and sophisticated
purchaser, and has engaged expert advisors, experienced in the evaluation and
purchase of properties and assets such as the Purchased Assets and assumption of
liabilities such as the Assumed Liabilities as contemplated
hereunder.  Purchaser acknowledges that Seller has given Purchaser
complete and open access to the key employees, documents and facilities of the
Business.  Purchaser acknowledges and agrees that the Purchased Assets
are being sold on an “as is, where is” basis and Purchaser agrees to accept the
Purchased Assets and the Assumed Liabilities in the condition they are in on the
Closing Date based on its own inspection, examination and determination with
respect to all matters and without reliance upon any express or implied
representations or warranties of any nature made by or on behalf of or imputed
to Seller, except as expressly set forth in this Agreement.  Without
limiting the generality of the foregoing, Purchaser acknowledges that Seller
makes no representation or warranty with respect to (i) any projections,
estimates or budgets delivered to or made available to Purchaser of future
revenues, future results of operations (or any component thereof), future cash
flows or future financial condition (or any component thereof) of the Business
or the future prospects or operations of the Business or (ii) any other
information or documents made available to Purchaser or its counsel, accountants
or advisors with respect to the Business, except as expressly set forth in this
Agreement.

     

    5. Pre-Closing
Covenants of Seller.  Seller agrees that:

     

    5.1.            Conduct of the
Business.  Except as may be required by the Bankruptcy Court,
except for the consequences resulting from the commencement and continuation of
the Bankruptcy Case, and except as may be required or contemplated by this
Agreement, from the date hereof until the sooner of the Closing Date or the date
of termination of this Agreement, Seller shall use its commercially reasonable
efforts to conduct the Business in the ordinary course consistent with past
practice, to preserve and protect the Acquired Intellectual Property Rights and
other Purchased Assets, and to preserve intact the business organizations and
relationships with third parties (including suppliers) and to keep available the
services of the present employees of the Business at their current levels of
compensation.  Without limiting the generality of the foregoing, from
the date hereof until the sooner of the Closing Date or the date of termination
of this Agreement, except (i) as disclosed on Schedule 5.1, (ii) as may be
required by the Bankruptcy Court, (iii) for the consequences resulting from the
commencement and continuation of the Bankruptcy Case, or (iv) as may be required
or contemplated by this Agreement, Seller will not:

     

    
      
        
        

      

      
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    (a) with
respect to the Business acquire a material amount of assets from any other
Person;

     

    (b) sell,
lease, license or otherwise dispose of any material Purchased Assets except (i)
pursuant to existing contracts or commitments disclosed to Purchaser prior to
the date of this Agreement, (ii) in the ordinary course consistent with past
practice, or (iii) subject to Section 7.4, in connection with a higher or better
bid for the Purchased Assets;

     

    (c) agree or
commit to do any of the foregoing; or

     

    (d) take any
action that would reasonably be expected to cause the failure of any condition
contained in Section 10.2 (other than actions taken by Seller in connection with
the discharge of its fiduciary duties during the Bankruptcy Case).

     

    5.2.            Access to
Information.  From the date hereof until the earlier of the
Closing Date or the date of termination of this Agreement, Seller shall
reasonably afford, and shall cause its officers, employees, attorneys and other
agents to reasonably afford, to Purchaser and its counsel, accountants and other
representatives, access (at reasonable times during normal business hours) to
officers and other employees of the Business for the purposes of evaluating the
Business and all properties, books, accounts, records and documents of, or
relating to, the Business, subject to the terms of the Confidentiality
Agreement.  All access to the officers, employees, properties, books,
accounts, records and/or documents of the Business shall be arranged on behalf
of Seller by Michael Margolis or John Chambers from Merriman, Curhan, Ford &
Co.

     

    5.3. Insurance; Risk of
Loss.  Any loss or damage to the Purchased Assets from fire,
theft or other casualty or cause, reasonable wear and tear excepted, prior to
the Closing, shall be the responsibility of Seller, and Seller shall bear the
risk of loss with respect thereto.  If, prior to the Closing, all or
any material part of the Purchased Assets are damaged by fire, theft or other
casualty or by any other cause whatsoever, reasonable wear and tear excepted,
Seller shall promptly give Purchaser written notice of such
damage.  In the event of any such damage, Purchaser shall have the
option to:  (a) require Seller to convey the Purchased Assets on
the Closing Date to Purchaser in a damaged condition and to assign to Purchaser
all of Seller's right, title and interest in and to any claims Seller may have
under any insurance policies covering the Purchased Assets (with a credit for
any deductible amount); or (b) terminate this Agreement.

     

    5.4.     Notices of Certain
Events.  Seller shall promptly notify Purchaser of, and provide
copies of, if applicable:

     

    (a) any
notice or other written communication from any Person alleging that the consent
of such Person is or may be required in connection with the consummation of the
Transactions;

     

    (b) any
material written communication from any governmental or regulatory agency or
authority in connection with or relating to the Transactions;

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

    (c) any
written communication sent to or received from the United States Food and Drug
Administration and relating to the Purchased Assets;

     

    (d) any
failure of Seller to comply with or satisfy in any material respect any
covenant, condition or agreement to be complied with or satisfied by Seller
hereunder; and

     

    (e) the
commencement of any actions, suits, investigations or proceedings relating to
Seller or the Business that, if pending on the date of this Agreement, would
have been required to have been disclosed pursuant to Section 3.6.

     

    6. Covenants
of Purchaser.  Purchaser agrees that:

     

    6.1.            Confidentiality.  Prior
to the Closing Date and after any termination of this Agreement, the
Confidentiality Agreement shall remain in full force and
effect.  After the Closing has occurred, the Confidentiality Agreement
shall be terminated to the extent relating to the Purchased Assets, Assumed
Liabilities and the employees of Seller, and shall, with respect to any of the
Excluded Assets and Excluded Liabilities, remain in full force and
effect.

     

    6.2.            Access.  On
and after the Closing Date, upon reasonable advance notice, Purchaser will
afford promptly to Seller and its agents, at Seller's expense, reasonable access
during normal business hours to the properties, books and records acquired from
Seller and Purchaser's employees, auditors and counsel to the extent necessary
for financial reporting and accounting matters, employee benefits matters, the
preparation and filing of any Tax returns, reports or forms, the preparation and
filing of reports and other documents with the Securities and Exchange
Commission, the defense of any Tax audit, claim or assessment, the
reconciliation of Claims in the Bankruptcy Case, to permit Seller to determine
any matter relating to its rights and obligations hereunder, or any other
reasonable business purpose related to the Excluded Assets or Excluded
Liabilities; provided, however, that any
such access by Seller shall not unreasonably interfere with the conduct of the
business of Purchaser; provided, further, at the
request of Purchaser, Seller shall execute (on its behalf and on behalf of its
agents and representatives) a reasonable confidentiality agreement in connection
with being provided such access.

     

    6.3. Insurance.  To
the extent that any insurance policies of Seller or any of its Affiliates cover
any loss, liability, claim, damage or expense relating to any Purchased Assets
and such insurance policies continue after the Closing to permit claims to be
made thereunder with respect to events occurring prior to the Closing, Purchaser
shall cooperate with Seller in submitting and pursuing such claims.

     

    6.4. Adequate
Assurance.  In connection with the entry of the Approval Order,
Purchaser shall take any and all reasonable actions needed to provide “adequate
assurance of future performance” with respect to the Assumed Contracts and any
Intellectual Property Rights pursuant to Section 365 of the Bankruptcy
Code.

     

    6.5. Required
Consents.  Purchaser shall use its commercially reasonable
efforts to obtain the Required Consents as soon as possible and, in any event,
prior to the End 

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        
Date;
provided, however, that the foregoing shall not require the Purchaser to pay
money or agree to terms less economically advantageous to
Purchaser.

    

     

    7. Pre-Closing
Covenants of Purchaser and Seller.  Purchaser and Seller agree
that:

     

    7.1. Efforts; Further
Assurances.  Subject to the terms and conditions of this
Agreement, Purchaser and Seller will use their respective commercially
reasonable efforts to take, or cause to be taken, all actions and to do, or
cause to be done, all things necessary or desirable under applicable laws and
regulations to consummate the transactions contemplated by this Agreement; provided, however, Seller shall
be entitled to take such actions as are required in connection with the
discharge of its fiduciary duties during the Bankruptcy Case (including
soliciting higher or better offers for the Purchased Assets).  Seller
and Purchaser agree to execute and deliver such other documents, certificates,
agreements and other writings and to take such other actions as may be necessary
or desirable in order to vest in Purchaser good title to the Purchased Assets or
to evidence the assumption by Purchaser of the Assumed Liabilities.

     

    7.2. Certain
Filings.  Seller and Purchaser shall cooperate with one another
(i) in determining whether any action by or in respect of, or filing with, any
governmental body, agency, official or authority is required, or any actions,
consents, approvals or waivers are required to be obtained from parties to any
Assumed Contracts or Acquired Intellectual Property Rights, in connection with
the consummation of the Transactions, and (ii) in taking such actions or making
any such filings, furnishing information required in connection therewith and
seeking timely to obtain any actions, consents, approvals or
waivers.

     

    7.3.     Public
Announcements.  Purchaser shall not make any public
announcements or statements concerning the Transactions without the prior
written consent of Seller.  Purchaser acknowledges and agrees that
Seller may provide copies of this Agreement to parties in interest in the
Bankruptcy Case and to those parties to whom Seller determines it is necessary
to provide copies in connection with soliciting higher or better bids for the
Purchased Assets or as otherwise necessary in connection with the Bankruptcy
Case.  Seller also shall be entitled to file a copy of this Agreement
with the Bankruptcy Court or as otherwise required by law.

     

    7.4.      Bid Procedures Motion
and Sale Motion.

     

    (a) On or
before the date of execution of this Agreement, Seller will file: a motion (the
"Procedures/Sale
Motion") seeking (i) at an initial, interim, hearing, the entry of an
order (the “Bid
Procedures Order”), in a form and substance reasonably acceptable to
Purchaser, (A)  establishing notice, bidding, and sale procedures
(collectively, the "Bid Procedures") to
be used in connection with the sale of Seller’s non-cash assets; (B) approving
the Bid Protections (as defined below); and (C) setting a hearing (the “Sale Hearing”) to
consider the sale of the Seller’s assets to the party who submitted the highest
or best offer for the assets pursuant to the Bid Procedures; and (ii) at the
Sale Hearing, the entry of an order (the “Sale Order”), in form
and substance acceptable to the Purchaser, authorizing and approving the sale of
the Purchased Assets to Purchaser or to the party who submitted the highest or
best offer for the Purchased 

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        
Assets
(the "Sale
Order").  The Seller shall use its commercially reasonable
efforts to obtain the entry by the Bankruptcy Court of the Bid Procedures Order
no later than March 20, 2009, and entry by the Bankruptcy Court of the Sale
Order no later than March 27, 2009.

    

     

    (b) The
Procedures/Sale Motion shall seek approval of, and the Bid Procedures Order
shall approve, Bid Procedures that are in the form and substance reasonably
satisfactory to Purchaser.  In particular, the Bid Procedures shall
provide that, to be a qualified bid, an initial overbid for the Purchased Assets
shall be in cash in an amount equal to not less that the sum of (i) the Purchase
Price, (ii) the Bid Protections, and (iii) $100,000.00.

     

    (c) The Bid
Procedures Order shall provide that the Purchaser shall be entitled to receive
from the Seller (i) a fee in an amount equal to $200,000.00 (the "Break-Up Fee"), plus
(ii) the reimbursement of Purchaser's actual, reasonable, out-of-pocket expenses
incurred in connection with Purchaser’s due diligence investigation and the
negotiation and execution of this Agreement and the other documents contemplated
hereby in an amount that does not exceed $200,000.00 (the "Reimbursement
Amount; the Break-Up
Fee and the Reimbursement Amount are referred to collectively as the “Bid Protections”);
provided, however, the Bid
Protections shall be due and payable to Purchaser only in the event that (A)
Seller consummates a sale of the Purchased Assets to a party (other than
Purchaser) who submits a higher or better offer for the Purchased Assets
pursuant to the Bid Procedures, and (B) this Agreement shall not have been
terminated by Seller due to a material breach by Purchaser.  The Bid
Procedures Order shall provide that any payment of the Bid Protections shall be
deemed to be an administrative expense, with priority over any and all claims of
the kind specified in Sections 503(b) and 507(b) of the Bankruptcy
Code.  The Bid Procedures Order shall provide for such super-priority
administrative expense rights in form and substance satisfactory to
Purchaser.

     

    (d) Purchaser
and the Seller shall cooperate in good faith with filing and prosecuting, on an
expedited basis, the Procedures/Sale Motion and obtaining entry of the Bid
Procedures Order and the Sale Order, and the Seller shall deliver to Purchaser
prior to filing, and as early in advance as is practicable to permit adequate
and reasonable time for Purchaser and its counsel to review and comment upon,
copies of all proposed pleadings, motions, notices, statements, schedules,
applications, reports and other papers to be filed by the Seller in connection
with the Procedures/Sale Motion and the relief requested therein.

     

    (e) Seller
and Purchaser shall each use commercially reasonable efforts, and shall
cooperate, assist and consult with each other, to secure the entry of the Sale
Order; provided, however, Seller shall
be entitled to take such actions as may be required in connection with the
discharge of its fiduciary duties in the Bankruptcy Case (including soliciting
higher or better offers for the Purchased Assets).  The Seller shall
provide Purchaser with any information provided to any prospective buyers not
previously provided to Purchaser.  The Seller shall promptly notify
Purchaser of any written proposal received by the Seller with respect to a
competing transaction, and the 

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        
      Seller shall communicate to
Purchaser the material terms of any written proposal which it may receive with
respect to any competing transaction.

    

     

    7.5.            Notices.  If
at any time (i) Purchaser becomes aware of any material breach by Seller of any
representation, warranty, covenant or agreement contained herein and such breach
is capable of being cured by Seller, or (ii) Seller becomes aware of any breach
by Purchaser of any representation, warranty, covenant or agreement contained
herein and such breach is capable of being cured by Purchaser, the Party
becoming aware of such breach shall promptly notify the other Party, in
accordance with Section 13.1, in writing of such breach.  Upon such
notice of breach, the breaching Party shall have ten (10) days to cure such
breach prior to the exercise of any remedies in connection
therewith.

     

    8. Tax
Matters.

     

    8.1.            Tax
Cooperation.  Purchaser and Seller agree to furnish or cause to
be furnished to each other, upon request, as promptly as practicable, such
information and assistance relating to the Business and the Purchased Assets
(including access to books and records) as is reasonably necessary for the
preparation and filing of all Tax returns, the making of any election relating
to Taxes, the preparation for any audit by any Taxing Authority, and the
prosecution or defense of any claim, suit or proceeding relating to any
Tax.  Seller and Purchaser shall cooperate with each other in the
conduct of any audit or other proceeding relating to Taxes involving the
Purchased Assets or the Business.

     

    8.2. Transfer
Taxes.   In the event that any sales, use, transfer,
stamp, recording or other similar taxes, fees or charges (the “Transfer Taxes”) are
assessed at Closing or at any time thereafter on the transfer of any Purchased
Assets, then in each instance such Transfer Taxes incurred as a result of the
Transactions shall be paid by Purchaser.  Purchaser and Seller shall
cooperate in providing each other with any appropriate resale exemption
certifications and other similar documentation.

     

    8.3. Property
Taxes.  All Property Taxes for a Tax period which includes (but
does not end on) the Closing Date (collectively, the “Apportioned
Obligations”) shall be apportioned between Seller, on the one hand, and
Purchaser, on the other hand, based on the number of days of such Tax period
included in the Pre-Closing Tax Period and the number of days of such Tax period
after the Closing Date (with respect to any such Tax period, the “Post-Closing Tax
Period”).  Seller shall be liable for the proportionate amount
of such Property Taxes that is attributable to the Pre-Closing Tax Period, and
Purchaser shall be liable for the proportionate amount of such Property Taxes
that is attributable to the Post-Closing Tax Period.

     

    8.4. Apportionment.  Apportioned
Obligations or Transfer Taxes shall be timely paid, and all applicable filings,
reports and returns shall be filed, as provided by applicable
law.  The paying Party shall be entitled to reimbursement from the
non-paying Party in accordance with Section 8.2 or 8.3, as the case may
be.  Upon payment of any such Apportioned Obligation or Transfer Tax,
the paying Party shall present a statement to the non-paying Party setting forth
the amount of reimbursement to which the paying Party is entitled under Section
8.2 or 8.3, as the case may be, together with such supporting evidence as is
reasonably necessary to calculate the amount to be reimbursed.  The
non-paying Party shall 

    
      
        
        

      

      
        21

        
          

        

      

      
        
        
make such
reimbursement promptly but in no event later than ten (10) days after the
presentation of such statement.  Any payment not made within such time
shall bear interest at the rate per annum equal to the rate of interest
announced by JPMorgan Chase, N.A. from time to time as its base rate in New York
City. 

    

     

    9. Employee
Matters.

     

    9.1. Employees and Offers of
Employment.

     

    (a) As of the
Closing Date, Purchaser shall have no obligation to offer employment to any or
all of the employees of the Seller.  The Purchaser intends to retain
certain of the employees of the Seller and the Purchaser shall have the right,
in its sole discretion, to hire employees of the Seller who are employed in
connection with the Business on such terms and conditions as Purchaser shall
determine in its discretion (such employees, the "Transferred
Employees"), with such employment to commence on or after the Closing
Date.

     

    (b) Seller
has advised Purchaser that based on its decision to discontinue operations,
Seller has informed its employees that Seller is ceasing substantially all
operations except for those necessary to operate or sell the Excluded
Assets.  Seller has further advised Purchaser that it intends to
terminate those employees who it considers to not be necessary to the foregoing
operations.  In such event, Seller covenants to Purchaser that it will
pay such terminated employees in full for all earned wages and other benefits
accrued through the date of termination, and Seller covenants to continue to pay
those employees who are not terminated in full for all earned wages and other
benefits unless and to the extent directed otherwise by the Bankruptcy
Court.

     

    9.2. Employee
Records.  Purchaser shall maintain employee records of the
Transferred Employees for a period of not less than four (4) years and during
that period will afford Seller reasonable access to such records during
Purchaser's normal business hours.  Purchaser shall maintain the
confidentiality of such records and limit access thereto in a manner consistent
with Purchaser's treatment of its employee records. 

     

    9.3. Employee
Plans.  The Purchaser shall not be responsible or liable for
any payments required under the terms of any employee benefit plan or health and
welfare plan maintained by Seller.

     

    9.4.            Workers’
Compensation.  Seller shall be liable for all workers’
compensation claims arising out of injuries with an identifiable date of
occurrence sustained by Seller’s employees prior to the Closing
Date.  Purchaser shall be liable for all workers’ compensation claims
arising out of injuries with an identifiable date of occurrence, sustained by
Transferred Employees, if any, on and after the dates Purchaser hires them
(hereinafter, “Transferred Employees’
Employment Date”), including injuries sustained by a Transferred Employee
on or after the Transferred Employees’ Employment Date that are aggravations,
exacerbations or re-injuries of medical conditions or diagnoses resulting from
injuries that were sustained before the Transferred Employees’ Employment
Date.  Notwithstanding any other provision of this Agreement, all
workers’ compensation claims must be asserted in accordance 

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        
with the
terms and conditions of applicable workers’ compensation policies and this
Section 9.4 shall not enlarge or modify any employee’s right to assert such a
claim.

    

     

    10. Closing
Conditions.

     

    10.1. Conditions to Obligations of
Purchaser and Seller.  The obligations of Purchaser and Seller
to consummate the Closing are subject to the satisfaction of the following
conditions:

     

    (a) The
Bankruptcy Court shall have entered the Sale Order in the Bankruptcy Case,
authorizing the Transactions and approving this Agreement and the ancillary
agreements contemplated hereby under Sections 105(a), 363 and 365 of the
Bankruptcy Code, in form and substance reasonably acceptable to Seller and
Purchaser (including a finding that Purchaser is a “good faith” purchaser within
the meaning of Section 363(m) of the Bankruptcy Code and waiving any stay that
would otherwise be applicable pursuant to Bankruptcy Rules 6004(g) or 6006(d)
and finding that neither the Purchaser nor the Seller are entering into the
Transactions fraudulently and the Purchaser is not liable for any debts of the
Seller as a successor under federal or State law or under any other legal
theory), and as of the Closing Date the Sale Order shall not be stayed, shall be
in full force and effect, and shall not have been vacated or
reversed.

     

    (b) No
injunction, stay or similar order or decree, issued by any court, tribunal or
governmental entity, shall be in effect that restrains, enjoins, stays or
prohibits the consummation of the Transactions.

     

    10.2. Conditions to Obligations of
Purchaser.  The obligation of Purchaser to consummate the
Closing is subject to the satisfaction (or waiver by Purchaser) of the following
further conditions:

     

    (a) Seller
shall have performed in all material respects all of its obligations hereunder
required to be performed by Seller on or prior to the Closing Date; 

     

    (b) the
representations and warranties of Seller contained in this Agreement shall be
true and correct in all material respect at and as of the Closing Date, as if
made at and as of such date (or to the extent such representations and
warranties speak as of an earlier date, they shall be true and correct in all
material respects as of such earlier date); and

     

    (c) Seller
shall have taken all reasonable steps, as of the Closing Date, to prepare the
Business for any scheduled meetings with the United States Food and Drug
Administration.

     

    10.3. Conditions to Obligations of
Seller.  The obligation of Seller to consummate the Closing is
subject to the satisfaction (or waiver by Seller) of the following further
conditions:

     

    (a) Purchaser
shall have performed in all material respects all of its obligations hereunder
required to be performed by it on or prior to the Closing Date, and

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    (b) the
representations and warranties of Purchaser contained in this Agreement shall be
true and correct in all material respects at and as of the Closing Date, as if
made at and as of such date (or to the extent such representations and
warranties speak as of an earlier date, they shall be true and correct in all
material respects as of such earlier date).

     

    11. Survival;
Indemnification.

     

    11.1. Survival.  The
(a) representations and warranties of Seller, and (b) covenants and
agreements of Seller that by their terms are to be performed before Closing,
contained in this Agreement or in any certificate or other writing delivered in
connection herewith, shall be extinguished by and shall not survive the
Closing.  The covenants and agreements of Seller contained herein that
by their terms are to be performed after Closing shall survive the Closing for
such terms.

     

    11.2. Indemnification.  Each of Purchaser and Seller agrees to indemnify
the other with respect to any investment banking fees, financial advisory fees,
brokerage fees, finders’ fees, or other similar fees which are alleged to be due
and payable with respect to the Transactions and which are asserted as a result
of the actions of the indemnifying party.  There shall be no
post-Closing indemnification of Purchaser by Seller with respect to any matter
not set forth in this Section 11.2.

     

    12. Termination.

     

    12.1. Grounds for
Termination.  This Agreement may be terminated at any time
prior to the Closing:

     

    (a) by mutual
written agreement of Seller and Purchaser;

     

    (b) by
Purchaser if the Bid Procedures Order is not entered by March 23,
2009;

     

    (c) by
Purchaser or Seller if the Sale Order is not entered by March 31,
2009;

     

    (d) by
Purchaser, if Seller receives any written communication from the United States
Food and Drug Administration that casts substantial doubt on its approval of any
pending or potential submission, including a protocol for a clinical trial,
relating to the Business.

     

    (e) by Seller
or Purchaser, if the Closing shall not have been consummated on or before April
10, 2009 (the “End
Date”), unless the Party seeking termination is in breach of its
obligations hereunder;

     

    (f) by Seller
or Purchaser, if any condition set forth in Section 10.1 is not satisfied, and
such condition is incapable of being satisfied by the End Date;

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    (g) by
Purchaser, if any condition set forth in Section 10.2 has not been satisfied,
and such condition is incapable of being satisfied by the End Date;

     

    (h) by
Seller, if any condition set forth in Section 10.3 has not been satisfied, and
such condition is incapable of being satisfied by the End Date; or

     

    (i) by
Seller, if Seller executes a definitive agreement with a third party (other than
Purchaser) for the acquisition of all or substantially all the Purchased Assets
that represents a “higher or better” offer for the Purchased
Assets.

     

    The Party
desiring to terminate this Agreement pursuant to this Section 12.1 (other than
pursuant to Section 12.1(a)) shall give notice of such termination to the other
Party in accordance with Section 13.1.

     

    12.2. Effect of
Termination.  If this Agreement is terminated as permitted by
Section 12.1, such termination shall be without liability of any Party (or any
stockholder, member, director, manager, officer, employee, agent, consultant or
representative of such Party) to the other Party to this Agreement except as
expressly provided in Section 2.7 and Section 7.4.  The provisions of
Sections 2.7, 6.1, 7.4, 11.2, 12.2, 12.3, 12.4, 13.1, 13.4, 13.5, 13.6, 13.9 and
13.10 shall survive any termination hereof pursuant to
Section 12.1.

     

    12.3. Expenses.  Except
as otherwise provided herein, all costs and expenses incurred in connection with
this Agreement shall be paid by the Party incurring such cost or
expense.

     

    12.4. Exclusive
Remedies.  Effective as of Closing, Purchaser waives
irrevocably any rights and Claims Purchaser may have against Seller, whether in
law or in equity, relating to (i) any breach of representation, warranty,
covenant or agreement contained herein and occurring on or prior to the Closing,
or (ii) the Purchased Assets, Assumed Liabilities or the Business; provided, however, the
covenants contained herein that relate to the post-Closing period shall continue
in accordance with their terms and are not waived.  Purchaser and
Seller acknowledge and agree that if this Agreement is terminated pursuant to
Section 12.1, the provisions of Section 12.2 set forth the sole and
exclusive remedies of the Parties.

     

    13. Miscellaneous.

     

    13.1. Notices.  All
notices, requests and other communications to any Party hereunder shall be in
writing (including facsimile transmission) and shall be given,

     

    if to
Purchaser, to:

     

    Crabtree
Acquisition Co, LLC

    28161 N.
Keith Dr.

    Lake
Forest, IL 60045-4528

    attn: Mr.
Jack Schuler, President

    Fax:
_____________________

    

    with a
copy to:

    

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

    Harry
Gonso, Esq.

    ICE
MILLER, LLP

    One
American Square, Suite 3100

    Indianapolis,
IN 46282

    Fax:
(317) 236-2122

    

    if to
Seller, to:

    

    AtheroGenics,
Inc.

    8995
Westside Parkway

    Alpharetta,
Georgia  30004

    Attention:  Joseph
M. Gaynor, Jr.

    Fax:  678-336-2501

    

    with a
copy to:

    

    King
& Spalding LLP

    1180
Peachtree Street

    Atlanta,
Georgia  30309

    Attention:
Paul Ferdinands, Esq.

    Fax:
404-572-5129

    

    If to
Seller's Counsel, to:

    

    King
& Spalding LLP

    1180
Peachtree Street

    Atlanta,
Georgia  30309

    Attention:
Paul Ferdinands, Esq.

    Fax:
404-572-5129

    

    All such
notices, requests and other communications shall be deemed received on the date
of receipt by the recipient thereof if received prior to 5:00 p.m. in the place
of receipt and such day is a Business Day in the place of
receipt.  Otherwise, any such notice, request or communication shall
be deemed not to have been received until the next succeeding Business Day in
the place of receipt.

     

    13.2. Waivers.  No
failure or delay by any Party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege.  The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or remedies
provided by law.

     

    13.3. Successors and
Assigns.  The provisions of this Agreement shall be binding
upon and inure to the benefit of the Parties and their respective successors and
assigns (including, in the case of Seller, any Chapter 7 trustee or liquidating
agent or other representative appointed under a confirmed plan); provided, however, that no
Party may assign, delegate or 

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        
otherwise
transfer any of its rights or obligations under this Agreement without the
written consent of the other Party.  The foregoing notwithstanding,
the Purchaser may assign, delegate or otherwise transfer any or all of its
rights and obligations under this Agreement to a wholly-owned subsidiary without
the written consent of the Seller.

    

     

    13.4. Governing
Law.  This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Georgia and any applicable
provisions of the Bankruptcy Code, without regard to the principles of conflicts
of law that would provide for application of another law.

     

    13.5. Jurisdiction.  

     

    (a) Prior to
the closing of the Bankruptcy Case, except as otherwise expressly provided in
this Agreement, the Parties hereto agree that any suit, action or proceeding
seeking to enforce any provision of, or based on any matter arising out of or in
connection with, this Agreement or the Transactions shall be brought exclusively
in the Bankruptcy Court, and each of the Parties hereby irrevocably consents to
the jurisdiction of the Bankruptcy Court (and of the appropriate appellate
courts therefrom) in any such suit, action or proceeding and irrevocably waives,
to the fullest extent permitted by law, any objection that it may now or
hereafter have to the laying of the venue of any such suit, action or proceeding
in the Bankruptcy Court or that any such suit, action or proceeding which is
brought in the Bankruptcy Court has been brought in an inconvenient
forum.  Process in any such suit, action or proceeding may be served
on any Party anywhere in the world, whether within or without the jurisdiction
of the Bankruptcy Court.  Without limiting the foregoing, each Party
agrees that service of process on such Party as provided in Section 13.1 shall
be deemed effective service of process on such Party.

     

    (b) Upon the
closing of the Bankruptcy Case, except as otherwise expressly provided in this
Agreement, the Parties hereto agree that any suit, action or proceeding seeking
to enforce any provision of, or based on any matter arising out of or in
connection with, this Agreement or the Transactions may be brought in any court
having subject matter jurisdiction over such suit, action or proceeding, and
that any cause of action arising out of this Agreement shall be deemed to have
arisen from a transaction of business in the State of Georgia, and each of the
Parties hereby irrevocably consents to the jurisdiction of such courts (and of
the appropriate appellate courts therefrom) in any such suit, action or
proceeding and irrevocably waives, to the fullest extent permitted by law, any
objection that it may now or hereafter have to the laying of the venue of any
such suit, action or proceeding in any such court or that any such suit, action
or proceeding which is brought in any such court has been brought in an
inconvenient forum.  Process in any such suit, action or proceeding
may be served on any Party anywhere in the world, whether within or without the
jurisdiction of any such court.  Without limiting the foregoing, each
Party agrees that service of process on such Party as provided in Section 13.1
shall be deemed effective service of process on such Party.

     

    13.6. Waiver of Jury
Trial.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL 

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        
PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE
TRANSACTIONS.

    

     

    13.7. Third Party
Beneficiaries.  No provision of this Agreement is intended to
confer upon any Person other than the Parties hereto any rights or remedies
hereunder.

     

    13.8. Entire Agreement;
Amendments; Counterparts.  This Agreement (including the
Schedules and Exhibits hereto) and the Confidentiality Agreement set forth the
entire agreement among the Parties with respect to the subject matter hereof and
may be amended only by a writing executed by Purchaser and
Seller.  This Agreement may be executed in counterparts, each of which
when taken together shall constitute an original.  This Agreement
shall become effective when each Party hereto shall have received a counterpart
hereof signed by the other Party hereto.

     

    13.9. Captions,
Interpretation.  The captions contained in this Agreement are
for convenience of reference only and shall not affect the meaning or
interpretation of this Agreement.  Whenever the words “include,”
“includes” or “including” are used in this Agreement, they shall be deemed to be
followed by the words “without limitation.”  In the event an ambiguity
or question of intent or interpretation arises, this Agreement shall be
construed as if drafted jointly by the Parties and no presumption or burden of
proof shall arise favoring or disfavoring any Party by virtue of authorship of
any provisions of this Agreement.

     

    13.10. Disclosure
Schedules.  The Parties acknowledge and agree that (i) the
Schedules to this Agreement may include certain items and information solely for
informational purposes for the convenience of Purchaser, and (ii) the disclosure
by Seller of any matter in the Schedules shall not be deemed to constitute an
acknowledgement by Seller that the matter is required to be disclosed by the
terms of this Agreement or that the matter is material.  If any
Schedule discloses an item or information, the matter shall be deemed to have
been disclosed in all other Schedules, notwithstanding the omission of an
appropriate cross reference to such other Schedules.

     

    [Signatures
on Following Page]

     

    
      
         

      

      
        28

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.

     

    

    CRABTREE ACQUISITION CO,
LLC

    

    

    

    By: 
/s/JACK W.
SCHULER                                                               

    

    Name: 
Jack W.
Schuler                                                              

    

    Title:                                                                

    

    

    

    ATHEROGENICS,
INC.

    

    

    By: 
/s/MARK P.
COLONNESE                                                              

    

    Name: 
Mark P.
Colonnese                                                               

    

    Title: 
EVP Commercial Operations and
CFO                                                                

    

    

    KING
& SPALDING LLP

    Solely
for the purposes of Section 2.7

    

    

    By: 
/s/PAUL
FERDINANDS                                                            

    

    Name: 
Paul
Ferdinands                                                              

    

    Title: 
Partner                                                               

    

    

    

    
      
         

      

      
        29ex101.htm

    

    

    

    

    

    

    

    

    

    STOCK INCENTIVE
PLAN

    

    

    

    

    

    

    

    

    For:

     

     

     

     

     

    CONSTITUTION
MINING CORP.

    

    

    

    

    

    

    

    

    

    

    

    

    Constitution Mining
Corp.

    6139 S.
Rural Road, Suite 103, Tempe, Arizona, U.S.A., 85283-2929

    __________

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    CONSTITUTION MINING
CORP.

     

    (as Amended and Restated on
March 3, 2009)

     

    
      	
              1.  

            	
              PURPOSE

            

    

     

    1.1     
The
purpose of this Stock Incentive Plan of Constitution Mining Corp. (the “Company”) is to advance the
interests of the Company by encouraging Eligible Participants (as herein
defined) to acquire shares of the Company, thereby increasing their proprietary
interest in the Company, encouraging them to remain associated with the Company
and furnish them with additional incentive in their efforts on behalf of the
Company in the conduct of their affairs.

     

    1.2    
This Plan
is specifically designed for Eligible Participants of the Company who are
residents of the United States and/or subject to taxation in the United States,
although Awards (as herein defined) under this Plan may be issued to other
Eligible Participants.

     

    1.3    
This Plan
amends and replaces, in its entirety, the Company’s original 2007 Stock
Incentive Plan which was adopted by the Company on August 3, 2007 and
subsequently amended.

     

    
      	
              2.  

            	
              DEFINITIONS

            

    

     

    2.1    
As used
herein, the following definitions shall apply:

     

    
      	
              (a)  

            	
              “Administrator” means a
      Committee of the Board duly appointed by the Board, or otherwise the
      Board;

            

    

     

    
      	
              (b)  

            	
              “Affiliate” and “Associate” have the
      meanings ascribed to such terms in Rule 12b 2 promulgated under the
      Exchange Act;

            

    

     

    
      	
              (c)  

            	
              “Applicable Laws” means
      the legal requirements relating to the administration of stock incentive
      plans, if any, under applicable provisions of federal securities laws,
      state corporate laws, state or provincial securities laws, the Code, the
      rules of any applicable stock exchange or national market system, and the
      rules of any foreign jurisdiction applicable to Awards granted to
      residents therein;

            

    

     

    
      	
              (d)  

            	
              “Award” means the grant
      of an Option, SAR, Restricted Stock, unrestricted Shares, Restricted Stock
      Unit, Deferred Stock Unit or other right or benefit under this
      Plan;

            

    

     

    
      	
              (e)  

            	
              “Award Agreement” means
      the written agreement evidencing the grant of an Award executed by the
      Company and the Grantee, including any amendments
  thereto;

            

    

     

    
      	
              (f)  

            	
              “Award Right” means each
      right to acquire a Share pursuant to an
Award;

            

    

     

    
      	
              (g)  

            	
              “Board” means the Board
      of Directors of the Company;

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    
      	
              (h)  

            	
              “Cause” means, with
      respect to the termination by the Company or a Related Entity of the
      Grantee’s Continuous Service, that such termination is for ‘Cause’ as such
      term is expressly defined in a then-effective written agreement between
      the Grantee and the Company or such Related Entity, or in the absence of
      such then-effective written agreement and definition, is based on, in the
      determination of the Administrator, the
  Grantee’s:

            

    

     

    
      	
              (i)  

            	
              refusal
      or failure to act in accordance with any specific, lawful direction or
      order of the Company or a Related
Entity;

            

    

     

    
      	
              (ii)  

            	
              unfitness
      or unavailability for service or unsatisfactory performance (other than as
      a result of Disability);

            

    

     

    
      	
              (iii)  

            	
              performance
      of any act or failure to perform any act in bad faith and to the detriment
      of the Company or a Related Entity;

            

    

     

    
      	
              (iv)  

            	
              dishonesty,
      intentional misconduct or material breach of any agreement with the
      Company or a Related Entity; or

            

    

     

    
      	
              (v)  

            	
              commission
      of a crime involving dishonesty, breach of trust, or physical or emotional
      harm to any person;

            

    

     

    
      	
              (i)  

            	
              “Change in Control”
      means, except as provided below, a change in ownership or control of the
      Company effected through any of the following
  transactions:

            

    

     

    
      	
              (i)  

            	
              the
      direct or indirect acquisition by any person or related group of persons
      (other than an acquisition from or by the Company or by a
      Company-sponsored employee benefit plan or by a person that directly or
      indirectly controls, is controlled by, or is under common control with,
      the Company) of beneficial ownership (within the meaning of Rule 13d 3 of
      the Exchange Act) of securities possessing more than 50% of the total
      combined voting power of the Company’s outstanding securities pursuant to
      a tender or exchange offer made directly to the Company’s shareholders
      which a majority of the Continuing Directors who are not Affiliates or
      Associates of the offeror do not recommend such shareholders
      accept;

            

    

     

    
      	
              (ii)  

            	
              a
      change in the composition of the Board over a period of 36 months or less
      such that a majority of the Board members (rounded up to the next whole
      number) ceases, by reason of one or more contested elections for Board
      membership, to be comprised of individuals who are Continuing
      Directors;

            

    

     

    
      	
              (iii)  

            	
              the
      sale or exchange by the Company (in one or a series of transactions) of
      all or substantially all of its assets to any other person or entity;
      or

            

    

     

    
      
         

      

      
        - 2
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (iv)  

            	
              approval
      by the shareholders of the Company of a plan to dissolve and liquidate the
      Company.

            

    

     

    Notwithstanding
the foregoing, the following transactions shall not constitute a “Change of
Control”:

     

    
      	
              (v)  

            	
              the
      closing of any public offering of the Company’s securities pursuant to an
      effective registration statement filed under the United States Securities Act of 1933,
      as amended,

            

    

     

    
      	
              (vi)  

            	
              the
      closing of a public offering of the Company’s securities through the
      facilities of any stock exchange;
or

            

    

     

    
      	
              (vii)  

            	
              with
      respect to an Award that is subject to Section 409A of the Code, and
      payment or settlement of such Award is to be accelerated in connection
      with an event that would otherwise constitute a Change of Control, no
      event set forth previously in this definition shall constitute a Change of
      Control for purposes of this Plan or any Award Agreement unless such event
      also constitutes a “change in the ownership”, “change in the effective
      control” or “change in the ownership of a substantial portion of the
      assets of the corporation” as defined under Section 409A of the Code and
      Treasury guidance formulated thereunder which guidance currently provides
      that:

            

    

     

    
      	
              (A)  

            	
              a
      “change in ownership” of a corporation shall be deemed to have occurred if
      any one person or more than one person acting as a group acquires stock of
      a corporation that constitutes more than 50% of the total Fair Market
      Value or total voting power of the stock of the corporation. Stock
      acquired by any person or group of people who already owns more than 50%
      of such total Fair Market Value or total voting power of stock shall not
      trigger a change in ownership;

            

    

     

    
      	
              (B)  

            	
              a
      “change in the effective control” of a corporation generally shall be
      deemed to have occurred if within a 12-month period
  either:

            

    

     

    
      	
              (I)  

            	
              any
      one person or more than one person acting as a group acquires ownership of
      stock possessing 35% or more of the total voting power of the stock of the
      corporation; or

            

    

     

    
      	
              (II)  

            	
              a
      majority of the members of the corporation’s board of directors is
      replaced by directors whose appointment or election is not endorsed by a
      majority of the members of the corporation’s board of directors prior to
      the date of the appointment or election;
and

            

    

     

    
      
         

      

      
        - 3
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (C)  

            	
              a
      “change in the ownership of a substantial portion of the corporation’s
      assets” generally is deemed to occur if within a 12-month period any
      person, or more than one person acting as a group, acquires assets from
      the corporation that have a total gross fair market value at least equal
      to 40% of the total gross fair market value of all the corporation’s
      assets immediately prior to such acquisition.  The gross fair
      market value of assets is determined without regard to any
      liabilities;

            

    

     

    
      	
              (j)  

            	
              “Code” means the United
      States Internal Revenue
      Code of 1986, as amended;

            

    

     

    
      	
              (k)  

            	
              “Committee” means the
      Compensation Committee or any other committee appointed by the Board to
      administer this Plan in accordance with the provisions of this
      Plan;

            

    

     

    
      	
              (l)  

            	
              “Common Stock” means the
      common stock of the Company;

            

    

     

    
      	
              (m)  

            	
              “Company” means
      Constitution Mining Corp., a Nevada
corporation;

            

    

     

    
      	
              (n)  

            	
              “Consultant” means any
      person (other than an Employee) who is engaged by the Company or any
      Related Entity to render consulting or advisory services to the Company or
      such Related Entity;

            

    

     

    
      	
              (o)  

            	
              “Continuing Directors”
      means members of the Board who either (i) have been Board members
      continuously for a period of at least 36 months, or (ii) have been Board
      members for less than 36 months and were appointed or nominated for
      election as Board members by at least a majority of the Board members
      described in clause (i) who were still in office at the time such
      appointment or nomination was approved by the
  Board;

            

    

     

    
      	
              (p)  

            	
              “Continuous Service”
      means that the provision of services to the Company or a Related Entity in
      any capacity of Employee, Director or Consultant that is not interrupted
      or terminated. Continuous Service shall not be considered interrupted in
      the case of (i) any approved leave of absence, (ii) transfers between
      locations of the Company or among the Company, any Related Entity, or any
      successor, in any capacity of Employee, Director or Consultant, or (iii)
      any change in status as long as the individual remains in the service of
      the Company or a Related Entity in any capacity of Employee, Director or
      Consultant (except as otherwise provided in the Award Agreement). An
      approved leave of absence shall include sick leave, maternity or paternity
      leave, military leave, or any other authorized personal leave. For
      purposes of incentive stock options, no such leave may exceed 90 calendar
      days, unless reemployment upon expiration of such leave is guaranteed by
      statute or contract;

            

    

     

    
      
         

      

      
        - 4
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (q)  

            	
              “Corporate Transaction”
      means any of the following
transactions:

            

    

     

    
      	
              (i)  

            	
              a
      merger or consolidation in which the Company is not the surviving entity,
      except for a transaction the principal purpose of which is to change the
      jurisdiction in which the Company is
organized;

            

    

     

    
      	
              (ii)  

            	
              the
      sale, transfer or other disposition of all or substantially all of the
      assets of the Company (including the capital stock of the Company’s
      subsidiary corporations) in connection with the complete liquidation or
      dissolution of the Company; or

            

    

     

    
      	
              (iii)  

            	
              any
      reverse merger in which the Company is the surviving entity but in which
      securities possessing more than 50% of the total combined voting power of
      the Company’s outstanding securities are transferred to a person or
      persons different from those who held such securities immediately prior to
      such merger;

            

    

     

    
      	
              (r)  

            	
              “Covered Employee” means
      an Employee who is a “covered employee” under Section 162(m)(3) of the
      Code;

            

    

     

    
      	
              (s)  

            	
              “Deferred Stock Units”
      means Awards that are granted to Directors and are subject to the
      additional provisions set out in Subpart A which is attached hereto and
      which forms a material part hereof;

            

    

     

    
      	
              (t)  

            	
              “Director” means a member
      of the Board or the board of directors of any Related
    Entity;

            

    

     

    
      	
              (u)  

            	
              “Disability” or “Disabled” means that a
      Grantee is unable to carry out the responsibilities and functions of the
      position held by the Grantee by reason of any medically determinable
      physical or mental impairment.  A Grantee shall not be
      considered to have incurred a Disability unless he or she furnishes proof
      of such impairment sufficient to satisfy the Administrator in its
      discretion.  Notwithstanding the above, (i) with respect to an
      Incentive Stock Option, “Disability” or “Disabled” shall mean permanent
      and total disability as defined in Section 22(e)(3) of the Code and (ii)
      to the extent an Option is subject to Section 409A of the Code, and
      payment or settlement of the Option is to be accelerated solely as a
      result of the Eligible Participant’s Disability, Disability shall have the
      meaning ascribed thereto under Section 409A of the Code and the Treasury
      guidance promulgated thereunder;

            

    

     

    
      	
              (v)  

            	
              “Disinterested Shareholder
      Approval” means approval by a majority of the votes cast by all the
      Company’s shareholders at a duly constituted shareholders’ meeting,
      excluding votes attached to shares beneficially owned by
      Insiders;

            

    

     

    
      
         

      

      
        - 5
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (w)  

            	
              “Eligible Participant”
      means any person who is an Officer, a Director, an Employee or a
      Consultant, including individuals who are foreign nationals or are
      employed or reside outside the United
States;

            

    

     

    
      	
              (x)  

            	
              “Employee” means any
      person who is a full-time or part-time employee of the Company or any
      Related Entity;

            

    

     

    
      	
              (y)  

            	
              “Exchange Act” means the
      United States Securities Exchange Act of 1934,
      as amended;

            

    

     

    
      	
              (z)  

            	
              “Fair Market Value”
      means, as of any date, the value of a Share determined in good faith by
      the Administrator.  By way of illustration, but not limitation,
      for the purpose of this definition, good faith shall be met if the
      Administrator employs the following
methods:

            

    

     

    
      	
              (i)  

            	
              Listed Stock.
      If the Common Stock is traded on any established stock exchange or quoted
      on a national market system, fair market value shall be (A) the closing
      sales price for the Common Stock as quoted on that stock exchange or
      system for the date the value is to be determined (the “Value Date”) as
      reported in The Wall Street Journal or a similar publication, or (B) if
      the rules of the applicable stock exchange require, the volume-weighted
      average trading price for five days prior to the date the Board approves
      the grant of the Award.  If no sales are reported as having
      occurred on the Value Date, fair market value shall be that closing sales
      price for the last preceding trading day on which sales of Common Stock is
      reported as having occurred.  If no sales are reported as having
      occurred during the five trading days before the Value Date, fair market
      value shall be the closing bid for Common Stock on the Value
      Date.  If the Common Stock is listed on multiple exchanges or
      systems, fair market value shall be based on sales or bids on the primary
      exchange or system on which Common Stock is traded or
      quoted.  If the rules of any applicable stock exchange or system
      require a different method of calculating fair market value, then such
      method as is required by those
rules;

            

    

     

    
      	
              (ii)  

            	
              Stock Quoted by
      Securities Dealer. If Common Stock is regularly quoted by a
      recognized securities dealer but selling prices are not reported on any
      established stock exchange or quoted on a national market system, fair
      market value shall be the mean between the high bid and low asked prices
      on the Value Date.  If no prices are quoted for the Value Date,
      fair market value shall be the mean between the high bid and low asked
      prices on the last preceding trading day on which any bid and asked prices
      were quoted;

            

    

     

    
      
         

      

      
        - 6
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (iii)  

            	
              No Established
      Market. If Common Stock is not traded on any established stock
      exchange or quoted on a national market system and is not quoted by a
      recognized securities dealer, the Administrator will determine fair market
      value in good faith.  The Administrator will consider the
      following factors, and any others it considers significant, in determining
      fair market value: (A) the price at which other securities of the Company
      have been issued to purchasers other than Employees, Directors, or
      Consultants; (B) the Company’s net worth, prospective earning power,
      dividend-paying capacity, and non-operating assets, if any; and (C) any
      other relevant factors, including the economic outlook for the Company and
      the Company’s industry, the Company’s position in that industry, the
      Company’s goodwill and other intellectual property, and the values of
      securities of other businesses in the same
  industry;

            

    

     

    
      	
              (iv)  

            	
              Additional
      Valuation.  For publicly traded companies, any valuation
      method permitted under Section 20.2031-2 of the Estate Tax Regulations;
      or

            

    

     

    
      	
              (v)  

            	
              Non-Publicly Traded
      Stock.  For non-publicly traded stock, the fair market
      value of the Common Stock at the Grant Date based on an average of the
      fair market values as of such date set forth in the opinions of completely
      independent and well-qualified experts (the Participant’s status as a
      majority or minority shareholder may be taken into
      consideration).

            

    

     

    Regardless
of whether the Common Stock offered under the Award is publicly traded, a good
faith attempt under this definition shall not be met unless the fair market
value of the Common Stock on the Grant Date is determined with regard to
nonlapse restrictions (as defined in Section 1.83-3(h) of the Treasury
Regulations) and without regard to lapse restrictions (as defined in Section
1.83-3(i) of the Treasury Regulations);

     

    
      	
              (aa)  

            	
              “Grantee” means an
      Eligible Participant who receives an Award pursuant to an Award
      Agreement;

            

    

     

    
      	
              (bb)  

            	
              “Grant Date” means the
      date the Administrator approves that grant of an
      Award.  However, if the Administrator specifies that an Award’s
      Grant Date is a future date or the date on which a condition is satisfied,
      the Grant Date for such Award is that future date or the date that the
      condition is satisfied;

            

    

     

    
      	
              (cc)  

            	
              “Incentive Stock Option”
      means an Option within the meaning of Section 422 of the
    Code;

            

    

     

    
      	
              (dd)  

            	
              “Insider”
      means:

            

    

     

    
      	
              (i)  

            	
              a
      Director or Senior Officer of the
Company;

            

    

     

    
      
         

      

      
        - 7
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (ii)  

            	
              a
      Director or Senior Officer of a person that is itself an Insider or
      Subsidiary of the Company;

            

    

     

    
      	
              (iii)  

            	
              a
      person that has

            

    

     

    
      	
              (A)  

            	
              direct
      or indirect beneficial ownership
of,

            

    

     

    
      	
              (B)  

            	
              control
      or direction over, or

            

    

     

    
      	
              (C)  

            	
              a
      combination of direct or indirect beneficial ownership of and control or
      direction over,

            

    

     

    securities
of the Company carrying more than 10% of the voting rights attached to all the
Company’s outstanding voting securities, excluding, for the purpose of the
calculation of the percentage held, any securities held by the person as
underwriter in the course of a distribution; or

     

    
      	
              (iv)  

            	
              the
      Company itself, if it has purchased, redeemed or otherwise acquired any
      securities of its own issue, for so long as it continues to hold those
      securities;

            

    

     

    
      	
              (ee)  

            	
              “Named Executive Officer”
      means, if applicable, an Eligible Participant who, as of the date of
      vesting and/or payout of an Award, is one of the group of “Covered
      Employees,” as defined;

            

    

     

    
      	
              (ff)  

            	
              “Non-Qualified Stock
      Option” means an Option which is not an Incentive Stock
      Option;

            

    

     

    
      	
              (gg)  

            	
              “Officer” means a person
      who is an officer, including a Senior Officer, of the Company or a Related
      Entity within the meaning of Section 16 of the Exchange Act and the rules
      and regulations promulgated
thereunder;

            

    

     

    
      	
              (hh)  

            	
              “Option” means an option
      to purchase Shares pursuant to an Award Agreement granted under the
      Plan;

            

    

     

    
      	
              (ii)  

            	
              “Parent” means a “parent corporation”,
      whether now or hereafter existing, as defined in Section 424(e) of the
      Code;

            

    

     

    
      	
              (jj)  

            	
              “Performance - Based
      Compensation” means compensation qualifying as “performance-based
      compensation” under Section 162(m) of the
Code;

            

    

     

    
      	
              (kk)  

            	
              “Plan” means this Stock
      Incentive Plan as amended from time to
time;

            

    

     

    
      
         

      

      
        - 8
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (ll)  

            	
              “Related Entity” means
      any Parent or Subsidiary, and includes any business, corporation,
      partnership, limited liability company or other entity in which the
      Company, a Parent or a Subsidiary holds a greater than 50% ownership
      interest, directly or indirectly;

            

    

     

    
      	
              (mm)  

            	
              “Related Entity
      Disposition” means the sale, distribution or other disposition by
      the Company of all or substantially all of the Company’s interests in any
      Related Entity effected by a sale, merger or consolidation or other
      transaction involving that Related Entity or the sale of all or
      substantially all of the assets of that Related
  Entity;

            

    

     

    
      	
              (nn)  

            	
              “Restricted Stock” means
      Shares issued under the Plan to the Grantee for such consideration, if
      any, and subject to such restrictions on transfer, rights of first
      refusal, repurchase provisions, forfeiture provisions, and other terms and
      conditions as, established by the Administrator and specified in the
      related Award Agreement;

            

    

     

    
      	
              (oo)  

            	
              “Restricted Stock Unit”
      means a notional account established pursuant to an Award granted to a
      Grantee, as described in this Plan, that is (i) valued solely by reference
      to Shares, (ii) subject to restrictions specified in the Award Agreement,
      and (iii) payable only in Shares;

            

    

     

    
      	
              (pp)  

            	
              “Restriction Period”
      means the period during which the transfer of Shares of Restricted Stock
      is limited in some way (based on the passage of time, the achievement of
      performance objectives, or the occurrence of other events as determined by
      the Administrator, in its sole discretion) or the Restricted Stock is not
      vested;

            

    

     

    
      	
              (qq)  

            	
              “SAR” means a stock
      appreciation right entitling the Grantee to Shares or cash compensation,
      as established by the Administrator, measured by appreciation in the value
      of Common Stock;

            

    

     

    
      	
              (rr)  

            	
              “Senior Officer”
      means:

            

    

     

    
      	
              (i)  

            	
              the
      chair or vice chair of the Board, the president, a vice-president, the
      secretary, the treasurer or the general manager of the Company or a
      Related Entity;

            

    

     

    
      	
              (ii)  

            	
              any
      individual who performs functions for a person similar to those normally
      performed by an individual occupying any office specified in Section
      2.1(rr)(i) above; and

            

    

     

    
      	
              (iii)  

            	
              the
      five highest paid employees of the Company or a Related Entity, including
      any individual referred to in Section 2.1(rr)(i) or 2.1(rr)(ii) and
      excluding a commissioned salesperson who does not act in a managerial
      capacity;

            

    

     

    
      
         

      

      
        - 9
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (ss)  

            	
              “Share” means a share of
      the Common Stock; and

            

    

     

    
      	
              (tt)  

            	
              “Subsidiary” means a
      “subsidiary
      corporation”, whether now or hereafter existing, as defined in
      Section 424(f) of the Code.

            

    

     

    
      	
              3.  

            	
              STOCK SUBJECT TO THE
      PLAN

            

    

     

    Number of Shares
Available

     

    3.1 (a)           Subject
to the provisions of Section 18, the maximum aggregate number of Shares which
may be issued pursuant to all Awards under this Plan is 20,000,000 (the “Maximum
Number”).  The maximum aggregate number of Shares that may be
granted in the form of Incentive Stock Options shall be 20,000,000.  See
Section 29 for Reservation of Shares.

     

    
      	
              (b)  

            	
              Shares
      that have been issued under the Plan pursuant to an Award shall not be
      returned to the Plan and shall not become available for future issuance
      under the Plan except that Shares (i) covered by an Award (or portion of
      an Award) which is forfeited or cancelled, expires or is settled in cash,
      or (ii) withheld to satisfy a Grantee’s minimum tax withholding
      obligations, shall be deemed not to have been issued for purposes of
      determining the Maximum Number of Shares which may be issued under the
      Plan.  Also, only the net numbers of Shares that are issued
      pursuant to the exercise of an Award shall be counted against the Maximum
      Number.

            

    

     

    
      	
              (c)  

            	
              However,
      in the event that prior to the Award’s cancellation, termination,
      expiration, forfeiture or lapse, the holder of the Award at any time
      received one or more elements of “beneficial ownership” pursuant to such
      Award (as defined by the United States Securities Exchange Commission (the
      “SEC”), pursuant
      to any rule or interpretations promulgated under Section 16 of the
      Exchange Act), the Shares subject to such Award shall not again be made
      available for regrant under the
Plan.

            

    

     

    Shares to
Insiders

     

    3.2    
Subject
to Section 15.1(c) and 15.1(d), no Insider of the Company is eligible to receive
an Award where:

     

    
      	
              (a)  

            	
              the
      Insider is not a Director or Senior Officer of the
  Company;

            

    

     

    
      	
              (b)  

            	
              any
      Award, together with all of the Company’s other previously established or
      proposed Awards under the Plan could result at any time
  in:

            

    

     

    
      	
              (i)  

            	
              the
      number of Shares reserved for issuance pursuant to Options granted to
      Insiders exceeding 50% of the outstanding issue of Common Stock;
      or

            

    

     

    
      
         

      

      
        - 10
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (ii)  

            	
              the
      issuance to Insiders pursuant to the exercise of Options, within a one
      year period of a number of Shares exceeding 50% of the outstanding issue
      of the Common Stock;

            

    

     

    provided,
however, that this restriction on the eligibility of Insiders to receive an
Award shall cease to apply if it is no longer required under any Applicable
Laws.

     

    Limitations on
Award

     

    3.3    
Unless
and until the Administrator determines that an Award to a Grantee is not
designed to qualify as Performance-Based Compensation, the following limits
(“Award Limits”) shall
apply to grants of Awards to Grantees subject to the Award Limits by Applicable
Laws under this Plan:

     

    
      	
              (a)  

            	
              Options and
      SARs.  Notwithstanding any provision in the Plan to the
      contrary (but subject to adjustment as provided in Section 18), the
      maximum number of Shares with respect to one or more Options and/or Stock
      Appreciation Rights that may be granted during any one calendar year under
      the Plan to any one Grantee shall be 5,000,000; all of which may be
      granted as Incentive Stock Options);
and

            

    

     

    
      	
              (b)  

            	
              Other
      Awards.  The maximum aggregate grant with respect to
      Awards of Restricted Stock, unrestricted Shares, Restricted Stock Units
      and Deferred Stock Units (or used to provide a basis of measurement for or
      to determine the value of Restricted Stock Units and Deferred Stock Units)
      in any one calendar year to any one Grantee (determined on the date of
      payment of settlement) shall be
5,000,000.

            

    

     

    
      	
              4.  

            	
              ADMINISTRATION

            

    

     

    Authority of Plan
Administrator

     

    4.1 Authority
to control and manage the operation and administration of this Plan shall be
vested in a committee consisting of two or more members of the Board (the “Committee”).  It is
intended that the directors appointed to serve on the Committee shall be
“non-employee directors” (within the meaning of Rule 16b-3 promulgated under the
Exchange Act) and “outside directors” (within the meaning of Section 162(m) of
the Code) to the extent that Rule 16b-3 and, if necessary for relief from the
limitation under Section 162(m) of the Code and such relief sought by the
Company, Section 162(m) of the Code, respectively, are
applicable.  However, the mere fact that a Committee member shall fail
to qualify under either of the foregoing requirements shall not invalidate any
Award made by the Committee which Award is otherwise validly made under the
Plan.  Members of the Committee may be appointed from time to time by,
and shall serve at the pleasure of, the Board.  As used herein, the
term “Administrator” means the Committee.

     

    
      
         

      

      
        - 11
-

        
          

        

      

      
         

      

    

    

     

    Powers of the
Administrator

     

    4.2    
Subject
to Applicable Laws and the provisions of the Plan or subplans hereof (including
any other powers given to the Administrator hereunder), and except as otherwise
provided by the Board, the Administrator shall have the exclusive power and
authority, in its discretion:

     

    
      	
              (a)  

            	
              to
      construe and interpret this Plan and any agreements defining the rights
      and obligations of  the Company and Grantees under this
      Plan;

            

    

     

    
      	
              (b)  

            	
              to
      select the Eligible Participants to whom Awards may be granted from time
      to time hereunder;

            

    

     

    
      	
              (c)  

            	
              to
      determine whether and to what extent Awards are granted
      hereunder;

            

    

     

    
      	
              (d)  

            	
              to
      determine the number of Shares or the amount of other consideration to be
      covered by each Award granted
hereunder;

            

    

     

    
      	
              (e)  

            	
              to
      approve forms of Award Agreements for use under the Plan, which need not
      be identical for each Grantee;

            

    

     

    
      	
              (f)  

            	
              to
      determine the terms and conditions of any Award granted under the Plan,
      including, but not limited to, the exercise price, grant price or purchase
      price, any restrictions or limitations on the Award, any schedule for
      lapse of forfeiture restrictions or restrictions on the exercisability of
      the Award, and acceleration or waivers thereof, based in each case on such
      considerations as the Committee in its sole discretion determines that is
      not inconsistent with any rule or regulation under any tax or securities
      laws or includes an alternative right that does not disqualify an
      Incentive Stock Option under applicable
  regulations;

            

    

     

    
      	
              (g)  

            	
              to
      amend the terms of any outstanding Award granted under the Plan, provided
      that any amendment that would adversely affect the Grantee’s rights under
      an existing Award shall not be made without the Grantee’s consent unless
      as a result of a change in Applicable
Law;

            

    

     

    
      	
              (h)  

            	
              to
      suspend the right of a holder to exercise all or part of an Award for any
      reason that the Administrator considers in the best interest of the
      Company;

            

    

     

    
      	
              (i)  

            	
              subject
      to regulatory approval, amend or suspend the Plan, or revoke or alter any
      action taken in connection therewith, except that no general amendment or
      suspension of the Plan, shall, without the written consent of all
      Grantees, alter or impair any Award granted under the Plan unless as a
      result of a change in the Applicable
Law;

            

    

     

    
      
         

      

      
        - 12
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (j)  

            	
              to
      establish additional terms, conditions, rules or procedures to accommodate
      the rules or laws of applicable foreign jurisdictions and to afford
      Grantees favorable treatment under such laws; provided, however, that no
      Award shall be granted under any such additional terms, conditions, rules
      or procedures with terms or conditions which are inconsistent with the
      provisions of the Plan;

            

    

     

    
      	
              (k)  

            	
              to
      further define the terms used in this
Plan;

            

    

     

    
      	
              (l)  

            	
              to
      correct any defect or supply any omission or reconcile any inconsistency
      in this Plan or in any Award
Agreement;

            

    

     

    
      	
              (m)  

            	
              to
      provide for rights of refusal and/or repurchase
  rights;

            

    

     

    
      	
              (n)  

            	
              to
      amend outstanding Award Agreements to provide for, among other things, any
      change or modification which the Administrator could have provided for
      upon the grant of an Award or in furtherance of the powers provided for
      herein that does not disqualify an Incentive Stock Option under applicable
      regulations unless the Grantee so
consents;

            

    

     

    
      	
              (o)  

            	
              to
      prescribe, amend and rescind rules and regulations relating to the
      administration of this Plan; and

            

    

     

    
      	
              (p)  

            	
              to
      take such other action, not inconsistent with the terms of the Plan, as
      the Administrator deems
appropriate.

            

    

     

    Effect of Administrator’s
Decision

     

    4.3    
All
decisions, determinations and interpretations of the Administrator shall be
conclusive and binding on all persons.  The Administrator shall not be
liable for any decision, action or omission respecting this Plan, or any Awards
granted or Shares sold under this Plan.  In the event an Award is
granted in a manner inconsistent with the provisions of this Section 4, such
Award shall be presumptively valid as of its grant date to the extent permitted
by the Applicable Laws.

     

    Action by
Committee

     

    4.4     
Except as
otherwise provided by committee charter or other similar corporate governance
documents, for purposes of administering the Plan, the following rules of
procedure shall govern the Committee.  A majority of the Committee
shall constitute a quorum. The acts of a majority of the members present at any
meeting at which a quorum is present, and acts approved unanimously in writing
by the members of the Committee in lieu of a meeting, shall be deemed the acts
of the Committee.  Each member of the Committee is entitled to, in
good faith, rely or act upon any report or other information furnished to that
member by any officer or other employee of the Company or any Parent or
Affiliate, the Company’s independent certified public accountants, or any
executive compensation consultant or other professional retained by the Company
to assist in the administration of the Plan.

     

    
      
         

      

      
        - 13
-

        
          

        

      

      
         

      

    

    

     

    Limitation on
Liability

     

    4.5    
To the
extent permitted by applicable law in effect from time to time, no member of the
Committee shall be liable for any action or omission of any other member of the
Committee nor for any act or omission on the member’s own part, excepting only
the member’s own willful misconduct or gross negligence, arising out of or
related to this Plan.  The Company shall pay expenses incurred by, and
satisfy a judgment or fine rendered or levied against, a present or former
member of the Committee in any action against such person (whether or not the
Company is joined as a party defendant) to impose liability or a penalty on such
person for an act alleged to have been committed by such person while a member
of the Committee arising with respect to this Plan or administration thereof or
out of membership on the Committee or by the Company, or all or any combination
of the preceding, provided, the Committee member was acting in good faith,
within what such Committee member reasonably believed to have been within the
scope of his or her employment or authority and for a purpose which he or she
reasonably believed to be in the best interests of the Company or its
stockholders.  Payments authorized hereunder include amounts paid and
expenses incurred in settling any such action or threatened
action.  The provisions of this Section 4.5 shall apply to the estate,
executor, administrator, heirs, legatees or devisees of a Committee member, and
the term “person” as used on this Section 4.5 shall include the estate,
executor, administrator, heirs, legatees, or devisees of such
person.

     

    
      	
              5.  

            	
              ELIGIBILITY

            

    

     

    Except as
otherwise provided, all types of Awards may be granted to Eligible Participants.
An Eligible Participant who has been granted an Award may be, if he or she
continues to be eligible, granted additional Awards.

     

    
      	
              6.  

            	
              AWARDS

            

    

     

    Type of
Awards

     

    6.1    
The
Administrator is authorized to award any type of arrangement to an Eligible
Participant that is not inconsistent with the provisions of the Plan and that by
its terms involves or might involve the issuance of:

     

    
      	
              (a)  

            	
              Shares,
      including unrestricted Shares;

            

    

     

    
      	
              (b)  

            	
              Options;

            

    

     

    
      	
              (c)  

            	
              SARs
      or similar rights with a fixed or variable price related to the Fair
      Market Value of the Shares and with an exercise or conversion privilege
      related to the passage of time, the occurrence of one or more events, or
      the satisfaction of performance criteria or other
    conditions;

            

    

     

    
      	
              (d)  

            	
              any
      other security with the value derived from the value of the Shares, such
      as Restricted Stock and Restricted Stock
Units;

            

    

     

    
      
         

      

      
        - 14
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (e)  

            	
              Deferred
      Stock Units;

            

    

     

    
      	
              (f)  

            	
              Dividend
      Equivalent Rights, as defined in Section 13;
or

            

    

     

    
      	
              (g)  

            	
              any
      combination of the foregoing.

            

    

     

    Designation of
Award

     

    6.2     
Each type
of Award shall be designated in the Award Agreement.  In the case of
an Option, the Option shall be designated as either an Incentive Stock Option or
a Non-Qualified Stock Option.  But see Section 7.3(a) regarding
exceeding the Incentive Stock Option threshold.

     

    
      	
              7.  

            	
              GRANT OF OPTIONS;
      TERMS AND CONDITIONS OF
GRANT

            

    

     

    Grant of
Options

     

    7.1 (a)           One
or more Options may be granted to any Eligible Participant.  Subject
to the express provisions of this Plan, the Administrator shall determine from
the Eligible Participants those individuals to whom Options under this Plan may
be granted.  The Shares underlying a grant of an Option may be in the
form of Restricted Stock or unrestricted Stock.

     

    
      	
              (b)  

            	
              Further,
      subject to the express provisions of this Plan, the Administrator shall
      specify the Grant Date, the number of Shares covered by the Option, the
      exercise price and the terms and conditions for exercise of the
      Options.  As soon as practicable after the Grant Date, the
      Company shall provide the Grantee with a written Award Agreement in the
      form approved by the Administrator, which sets out the Grant Date, the
      number of Shares covered by the Option, the exercise price and the terms
      and conditions for exercise of the
Option.

            

    

     

    
      	
              (c)  

            	
              The
      Administrator may, in its absolute discretion, grant Options under this
      Plan at any time and from time to time before the expiration of this
      Plan.

            

    

     

    General Terms and
Conditions

     

    7.2     
Except as
otherwise provided herein, the Options shall be subject to the following terms
and conditions and such other terms and conditions not inconsistent with this
Plan as the Administrator may impose:

     

    
      	
              (a)  

            	
              Exercise of
      Option. The Administrator may determine in its discretion whether
      any Option shall be subject to vesting and the terms and conditions of any
      such vesting.  The Award Agreement shall contain any such
      vesting schedule;

            

    

     

    
      
         

      

      
        - 15
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (b)  

            	
              Option
      Term.  Each Option and all rights or obligations
      thereunder shall expire on such date as shall be determined by the
      Administrator, but not later than ten years after the Grant Date (five
      years in the case of an Incentive Stock Option when the Optionee owns more
      than 10% of the total combined voting power of all classes of stock of the
      Company or any Parent or Subsidiary (a “Ten Percent
      Stockholder”)), and shall be subject to earlier termination as
      hereinafter provided;

            

    

     

    
      	
              (c)  

            	
              Exercise
      Price.  The Exercise Price of any Option shall be
      determined by the Administrator when the Option is granted, at such
      Exercise Price as may be determined by the Administrator in the
      Administrator’s sole and absolute discretion; provided, however, that the
      Exercise Price may not be less than 100% of the Fair Market Value of the
      Shares on the Grant Date with respect to any Incentive Stock Options which
      are granted and, provided further, that the Exercise Price of any
      Incentive Stock Option granted to a Ten Percent Stockholder shall not be
      less than 100% of the Fair Market Value of the Shares on the Grant
      Date.  Payment for the Shares purchased shall be made in
      accordance with Section 16 of this Plan.  The Administrator is
      authorized to issue Options, whether Incentive Stock Options or
      Non-qualified Stock Options, at an option price in excess of the Fair
      Market Value on the Grant Date, to determine the terms and conditions of
      any Award granted under the Plan, including, but not limited to, the
      exercise price, grant price or purchase price, any restrictions or
      limitations on the Award, any schedule for lapse of forfeiture
      restrictions or restrictions on the exercisability of the Award, and
      acceleration or waivers thereof, based in each case on such considerations
      as the Committee in its sole discretion determines that is not
      inconsistent with any rule or regulation under any tax or securities laws
      or includes an alternative right that does not disqualify an Incentive
      Stock Option under applicable
regulations;

            

    

     

    
      	
              (d)  

            	
              Method of
      Exercise.  Options may be exercised only by delivery to
      the Company of a stock option exercise agreement (the “Exercise Agreement”) in
      a form approved by the Administrator (which need not be the same for each
      Grantee), stating the number of Shares being purchased, the restrictions
      imposed on the Shares purchased under such Exercise Agreement, if any, and
      such representations and agreements regarding the Grantee’s investment
      intent and access to information and other matters, if any, as may be
      required or desirable by the Company to comply with applicable securities
      laws, together with payment in full of the exercise price for the number
      of Shares being purchased;

            

    

     

    
      
         

      

      
        - 16
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (e)  

            	
              Exercise After Certain
      Events.

            

    

     

    
      	
              (i)  

            	
              Termination of
      Continuous Services.

            

    

     

    
      	
              (A)  

            	
              Options.

            

    

     

    
      	
              (I)  

            	
              Termination of
      Continuous Services.  If for any reason other than
      Disability or death, a Grantee terminates Continuous Services with the
      Company or a Subsidiary, vested Options held at the date of such
      termination may be exercised, in whole or in part, at any time within
      three months after the date of such termination or such lesser period
      specified in the Award Agreement (but in no event after the earlier of (i)
      the expiration date of the Option as set forth in the Award Agreement, and
      (ii) ten years from the Grant Date (five years for a Ten Percent
      Stockholder if the Option is an Incentive Stock
  Option)).

            

    

     

    
      	
              (II)  

            	
              Continuation of
      Services as Consultant/Advisor.  If a Grantee granted an
      Incentive Stock Option terminates employment but continues as a Consultant
      (no termination of Continuous Services), Grantee need not exercise an
      Incentive Stock Option within three months of termination of employment
      but shall be entitled to exercise within three months of termination of
      Continuous Services to the Company or the Subsidiary (one year in the
      event of Disability or death) or such lesser period specified in the Award
      Agreement (but in no event after the earlier of (i) the expiration date of
      the Option as set forth in the Award Agreement, and (ii) ten years from
      the Grant Date).  However, if Grantee does not exercise within
      three months of termination of employment, pursuant to Section 422 of the
      Code the Option shall not qualify as an Incentive Stock
      Option.

            

    

     

    
      	
              (B)  

            	
              Disability and
      Death.  If a Grantee becomes Disabled while rendering
      Continuous Services to the Company or a Subsidiary, or dies while employed
      by the Company or Subsidiary or within three months thereafter, vested
      Options then held may be exercised by the Grantee, the Grantee’s personal
      representative, or by the person to whom the Option is transferred by the
      laws of descent and distribution, in whole or in part, at any time within
      one year after the termination because of the Disability or death or any
      lesser period specified in the Award Agreement (but in no event after
      the

            

    

     

    
      
         

      

      
        - 17
-

        
          

        

      

      
         

      

    

    

     

    earlier
of (i) the expiration date of the Option as set forth in the Award Agreement,
and (ii) ten years from the Grant Date (five years for a Ten Percent Stockholder
if the Option is an Incentive Stock Option).

     

    Limitations on Grant of
Incentive Stock Options

     

    7.3 (a)           Threshold.  The
aggregate Fair Market Value (determined as of the Grant Date) of the Shares for
which Incentive Stock Options may first become exercisable by any Grantee during
any calendar year under this Plan, together with that of Shares subject to
Incentive Stock Options first exercisable by such Grantee under any other plan
of the Company or any Parent or Subsidiary, shall not exceed
$100,000.  For purposes of this Section 7.3(a), all Options in excess
of the $100,000 threshold shall be treated as Non-Qualified Stock Options
notwithstanding the designation as Incentive Stock Options.  For this
purpose, Options shall be taken into account in the order in which they were
granted, and the Fair Market Value of the Shares shall be determined as of the
date the Option with respect to such Shares is granted.

     

    
      	
              (b)  

            	
              Compliance with
      Section 422 of the Code.  There shall be imposed in the
      Award Agreement relating to Incentive Stock Options such terms and
      conditions as are required in order that the Option be an “incentive stock
      option” as that term is defined in Section 422 of the
  Code.

            

    

     

    
      	
              (c)  

            	
              Requirement of
      Employment.  No Incentive Stock Option may be granted to
      any person who is not an Employee of the Company or a Parent or Subsidiary
      of the Company.

            

    

     

    
      	
              8.  

            	
              RESTRICTED STOCK
      AWARDS

            

    

     

    Grant of Restricted Stock
Awards

     

    8.1    
Subject
to the terms and provisions of this Plan, the Administrator is authorized to
make awards of Restricted Stock to any Eligible Participant in such amounts and
subject to such terms and conditions as may be selected by the
Administrator.  The restrictions may lapse separately or in
combination at such times, under such circumstances, in such installments,
time-based or upon the satisfaction of performance goals or otherwise, as the
Administrator determines at the time of the grant of the Award or thereafter.
(See Performance Goals, Section 14.4).  All awards of Restricted Stock
shall be evidenced by Award Agreements.

     

    Consideration

     

    8.2     
Restricted
Stock may be issued in connection with:

     

    
      	
              (a)  

            	
              Services.  Services
      rendered to the Company or an Affiliate (i.e. bonus);
    and/or

            

    

     

    
      	
              (b)  

            	
              Purchase
      Price.  A purchase price, as specified in the Award
      Agreement related to such Restricted
Stock.

            

    

     

    
      
         

      

      
        - 18
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    Voting and
Dividends

     

    8.3    
Unless
the Administrator in its sole and absolute discretion otherwise provides in an
Award Agreement, holders of Restricted Stock shall have the right to vote such
Restricted Stock and the right to receive any dividends declared or paid with
respect to such Restricted Stock.  The Administrator may provide that
any dividends paid on Restricted Stock must be reinvested in shares of Stock,
which may or may not be subject to the same vesting conditions and restrictions
applicable to such Restricted Stock.  All distributions, if any,
received by a Grantee with respect to Restricted Stock as a result of any stock
split, stock dividend, combination of shares, or other similar transaction shall
be subject to the restrictions applicable to the original Award.

     

    Forfeiture

     

    8.4     
In the
case of an event of forfeiture pursuant to the Award Agreement, including
failure to satisfy the restriction period or a performance objective during the
applicable restriction period, any Restricted Stock that has not vested prior to
the event of forfeiture shall automatically expire, and all of the rights, title
and interest of the Grantee thereunder shall be forfeited in their entirety
including but not limited to any right to vote and receive dividends with
respect to the Restricted Stock.  Notwithstanding the foregoing, the
Administrator may provide in any Award Agreement that restrictions or forfeiture
conditions relating to Restricted Stock shall be waived in whole or in part in
the event of terminations resulting from specified causes, and the Administrator
may in other cases waive in whole or in part restrictions or forfeiture
conditions relating to Restricted Stock, provided such waiver is in accordance
with the Applicable Laws.

     

    Certificates for Restricted
Stock

     

    8.5    
Restricted
Stock granted under this Plan may be evidenced in such manner as the
Administrator shall determine, including by way of certificates.  The
Administrator may provide in an Award Agreement that either (i) the Secretary of
the Company shall hold such certificates for the Grantee’s benefit until such
time as the Restricted Stock is forfeited to the Company or the restrictions
lapse, (see Escrow; Pledge of Shares, Section 23) or (ii) such certificates
shall be delivered to the Grantee, provided, however, that such certificates
shall bear a legend or legends that comply with the applicable securities laws
and regulations and make appropriate reference to the restrictions imposed under
this Plan and the Award Agreement.

     

    
      	
              9.  

            	
              UNRESTRICTED STOCK
      AWARDS

            

    

     

    The
Administrator may, in its sole discretion, grant (or sell at Fair Market Value
or such other higher purchase price determined by the Administrator in the Award
Agreement) an Award of unrestricted Shares to any Grantee pursuant to which such
Grantee may receive Shares free of any restrictions under this
Plan.

     

    
      
         

      

      
        - 19
-

        
          

        

      

      
         

      

    

    

     

    
      	
              10.  

            	
              RESTRICTED STOCK
      UNITS

            

    

     

    Grant of Restricted Stock
Units

     

    10.1     
Subject
to the terms and provisions of this Plan, the Administrator is authorized to
make awards of Restricted Stock Units to any Eligible Participant in such
amounts and subject to such terms and conditions as may be selected by the
Administrator.  These restrictions may lapse separately or in
combination at such times, under such circumstances, in such installments,
time-based or upon the satisfaction of performance goals or otherwise, as the
Administrator determines at the time of the grant of the Award or thereafter.
(See Performance Goals, Section 14.4).  All awards of Restricted Stock
Units shall be evidenced by Award Agreements.

     

    Number of Restricted Stock
Units

     

    10.2     
The Award
Agreement shall specify the number of Share equivalent units granted and such
other provisions as the Administrator determines.

     

    Consideration

     

    10.3 Restricted
Stock Units may be issued in connection with:

     

    
      	
              (a)  

            	
              Services.  Services
      rendered to the Company or an Affiliate (i.e. bonus);
    and/or

            

    

     

    
      	
              (b)  

            	
              Purchase
      Price.  A purchase price as specified in the Award
      Agreement related to such Restricted Stock
  Units.

            

    

     

    No Voting
Rights

     

    10.4     
The
holders of Restricted Stock Units shall have no rights as stockholders of the
Company.

     

    Dividend
Equivalency

     

    10.5    
The
Administrator, in its sole and absolute discretion, may provide in an Award
Agreement evidencing a grant of Restricted Stock Units that the holder shall be
entitled to receive, upon the Company’s payment of a cash dividend on its
outstanding Shares, a cash payment for each Restricted Stock
Unit.  (See Section 13, Dividend Equivalent Right).  Such
Award Agreement may also provide that such cash payment shall be deemed
reinvested in additional Restricted Stock Units at a price per unit equal to the
Fair Market Value of a Share on the date that such dividend is
paid.

     

    Creditor’s
Rights

     

    10.6    
A holder
of Restricted Stock Units shall have no rights other than those of a general
creditor of the Company.  Restricted Stock Units represent an unfunded
and unsecured obligation of the Company, subject to the terms and conditions of
the applicable Award Agreement.

     

    
      
         

      

      
        - 20
-

        
          

        

      

      
         

      

    

    

     

    Settlement of Restricted
Stock Units

     

    10.7     
Each
Restricted Stock Unit shall be paid and settled by the issuance of Restricted
Stock or unrestricted Shares in accordance with the Award Agreement and if such
settlement is subject to Section 409A of the Code only upon any one or more of
the following as provided for in the Award Agreement:

     

    
      	
              (a)  

            	
              a
      specific date or date determinable by a fixed
  schedule;

            

    

     

    
      	
              (b)  

            	
              upon
      the Eligible Participant’s termination of Continuous Services to the
      extent the same constitutes a separation from services for purposes of
      Section 409A of the Code except that if an Eligible Participant is a “key
      employee” as defined in Section 409A of the Code for such purposes, then
      payment or settlement shall occur 6 months following such separation of
      service;

            

    

     

    
      	
              (c)  

            	
              as
      a result of the Eligible Participant’s death or Disability;
    or

            

    

     

    
      	
              (d)  

            	
              in
      connection with or as a result of a Change in Control in compliance with
      Section 409A of the Code.

            

    

     

    Forfeiture

     

    10.8     
Upon
failure to satisfy any requirement for settlement as set forth in the Award
Agreement, including failure to satisfy any restriction period or performance
objective, any Restricted Stock Units held by the Grantee shall automatically
expire, and all of the rights, title and interest of the Grantee thereunder
shall be forfeited in their entirety including but not limited to any right to
receive dividends with respect to the Restricted Stock Units.

     

    
      	
              11.  

            	
              DIRECTOR SHARES AND
      DIRECTOR DEFERRED STOCK
UNITS

            

    

     

    The grant
of Awards of Shares to Directors and the election by Directors to defer the
receipt of the Awards of Shares (“Deferred Stock Units”) shall
be governed by the provisions of Subpart A which is attached
hereto.  The provisions of Subpart A are attached hereto as part of
this Plan and are incorporated herein by reference.

     

    
      	
              12.  

            	
              STOCK APPRECIATION
      RIGHTS

            

    

     

    Awards of
SARs

     

    12.1     
An SAR is
an award to receive a number of Shares (which may consist of Restricted Stock),
or cash, or Shares and cash, as determined by the Administrator in accordance
with Section 12.4 below, for services rendered to the Company.  A SAR
may be awarded pursuant to an Award Agreement that shall be in such form (which
need not be the same for each Grantee) as the Administrator shall from time to
time approve, and shall comply with and be subject to the terms and conditions
of this Plan.  A SAR may vary from Grantee to Grantee and between
groups of Grantees, and may be based upon performance objectives (See
Performance Goals in Section 14.4).

     

    
      
         

      

      
        - 21
-

        
          

        

      

      
         

      

    

    

     

    Term

     

    12.2    
The term
of a SAR shall be set forth in the Award Agreement as determined by the
Administrator.

     

    Exercise

     

    12.3    
A Grantee
desiring to exercise a SAR shall give written notice of such exercise to the
Company, which notice shall state the proportion of Shares and cash that the
Grantee desires to receive pursuant to the SAR exercised, subject to the
discretion of the Administrator.  Upon receipt of the notice from the
Grantee, subject to the Administrator’s election to pay cash as provided in
Section 12.4 below, the Company shall deliver to the person entitled thereto (i)
a certificate or certificates for Shares and/or (ii) a cash payment, in
accordance with Section 12.4 below.  The date the Company receives
written notice of such exercise hereunder is referred to in this Section 12 as
the “exercise date”.

     

    Number of Shares or Amount
of Cash

     

    12.4     
Subject
to the discretion of the Administrator to substitute cash for Shares, or some
portion of the Shares for cash, the amount of Shares that may be issued pursuant
to the exercise of a SAR shall be determined by dividing: (i) the total number
of Shares as to which the SAR is exercised, multiplied by the amount by which
the Fair Market Value of the Shares on the exercise date exceeds the Fair Market
Value of a Share on the date of grant of the SAR; by (ii) the Fair Market Value
of a Share on the exercise date; provided, however, that fractional Shares shall
not be issued and in lieu thereof, a cash adjustment shall be
paid.  In lieu of issuing Shares upon the exercise of a SAR, the
Administrator in its sole discretion may elect to pay the cash equivalent of the
Fair Market Value of the Shares on the exercise date for any or all of the
Shares that would otherwise be issuable upon exercise of the SAR.

     

    Effect of
Exercise

     

    12.5     
A partial
exercise of a SAR shall not affect the right to exercise the remaining SAR from
time to time in accordance with this Plan and the applicable Award Agreement
with respect to the remaining shares subject to the SAR.

     

    Forfeiture

     

    12.6     
In the
case of an event of forfeiture pursuant to the Award Agreement, including
failure to satisfy any restriction period or a performance objective, any SAR
that has not vested prior to the date of termination shall automatically expire,
and all of the rights, title and interest of the Grantee thereunder shall be
forfeited in their entirety.

     

    
      
         

      

      
        - 22
-

        
          

        

      

      
         

      

    

    

     

    
      	
              13.  

            	
              DIVIDEND EQUIVALENT
      RIGHT

            

    

     

    A
dividend equivalent right is an Award entitling the recipient to receive credits
based on cash distributions that would have been paid on the Shares specified in
the dividend equivalent right (or other Award to which it relates) if such
Shares had been issued to and held by the recipient (a “Dividend Equivalent
Right”).  A Dividend Equivalent Right may be granted hereunder
to any Grantee as a component of another Award or as a freestanding
Award.  The terms and conditions of Dividend Equivalent Right shall be
specified in the grant.  Dividend equivalents credited to the holder
of a Dividend Equivalent Right may be paid currently or may be deemed to be
reinvested in additional Shares, which may thereafter accrue additional
equivalents.  Any such reinvestment shall be at Fair Market Value on
the date of reinvestment. Dividend Equivalent Rights may be settled in cash or
Shares or a combination thereof, in a single installment or installments, all
determined in the sole discretion of the Administrator.  A Dividend
Equivalent Right granted as a component of another Award may provide that such
Dividend Equivalent Right shall be settled upon exercise, settlement, or payment
of, or lapse of restrictions on, such other Award, and that such Dividend
Equivalent Right shall expire or be forfeited or annulled under the same
conditions as such other Award.  A Dividend Equivalent Right granted
as a component of another Award may also contain terms and conditions different
from such other Award.

     

    
      	
              14.  

            	
              TERMS AND CONDITIONS
      OF AWARDS

            

    

     

    In
General

     

    14.1     
Subject
to the terms of the Plan and Applicable Laws, the Administrator shall determine
the provisions, terms, and conditions of each Award including, but not limited
to, the Award vesting schedule, repurchase provisions, rights of first refusal,
forfeiture provisions, form of payment (cash, Shares, or other consideration)
upon settlement of the Award, payment contingencies, and satisfaction of any
performance criteria.

     

    Term of
Award

     

    14.2    
The term
of each Award shall be the term stated in the Award Agreement.

     

    Transferability

     

    14.3 (a)           Limits on
Transfer.  No right or interest of a Grantee in any unexercised
or restricted Award may be pledged, encumbered or hypothecated to or in favor of
any party other than to the Company or a Related Entity or
Affiliate.  No Award shall be sold, assigned, transferred or disposed
of by a Grantee other than by the laws of descent and distribution or, in the
case of an Incentive Stock Option, pursuant to a domestic relations order that
would satisfy Section 414(p)(1)(A) of the Code if such Section applied to an
Award under the Plan; provided, however, that the Administrator may (but need
not) permit other transfers where the Administrator concludes that such
transferability (i) does not result in accelerated taxation or other adverse tax
consequences, (ii) does not cause any Option intended to be an Incentive Stock
Option to fail to be described in Section 422(b) of the Code, and (iii) is
otherwise appropriate and desirable, taking into account any factors deemed
relevant, including, without limitation, state or federal tax or securities laws
applicable to transferable Awards.

     

    
      
         

      

      
        - 23
-

        
          

        

      

      
         

      

    

    

     

    
      	
              (b)  

            	
              Beneficiaries.  Notwithstanding
      Section 14.3(a), a Grantee may, in the manner determined by the
      Administrator, designate a beneficiary to exercise the rights of the
      Grantee and to receive any distribution with respect to any Award upon the
      Grantee’s death.  A beneficiary, legal guardian, legal
      representative or other person claiming any rights under the Plan is
      subject to all terms and conditions of the Plan and any Award Agreement
      applicable to the Grantee, except to the extent the Plan and such Award
      Agreement otherwise provide, and to any additional restrictions deemed
      necessary or appropriate by the Administrator.  If no
      beneficiary has been designated or survives the Grantee, payment shall be
      made to the Grantee’s estate. Subject to the foregoing, a beneficiary
      designation may be changed or revoked by a Grantee at any time, provided
      the change or revocation is filed with the
  Administrator.

            

    

     

    Performance
Goals

     

    14.4    
In order
to preserve the deductibility of an Award under Section 162(m) of the Code, the
Administrator may determine that any Award granted pursuant to this Plan to a
Grantee that is or is expected to become a Covered Employee shall be determined
solely on the basis of (a) the achievement by the Company or Subsidiary of a
specified target return, or target growth in return, on equity or assets, (b)
the Company’s stock price, (c) the Company’s total shareholder return (stock
price appreciation plus reinvested dividends) relative to a defined comparison
group or target over a specific performance period, (d) the achievement by the
Company or a Parent or Subsidiary, or a business unit of any such entity, of a
specified target, or target growth in, net income, earnings per share, earnings
before income and taxes, and earnings before income, taxes, depreciation and
amortization, or (e) any combination of the goals set forth in (a) through (d)
above.  If an Award is made on such basis, the Administrator shall
establish goals prior to the beginning of the period for which such performance
goal relates (or such later date as may be permitted under Section 162(m) of the
Code or the regulations thereunder but not later than 90 days after commencement
of the period of services to which the performance goal relates), and the
Administrator has the right for any reason to reduce (but not increase) the
Award, notwithstanding the achievement of a specified goal.  Any
payment of an Award granted with performance goals shall be conditioned on the
written certification of the Administrator in each case that the performance
goals and any other material conditions were satisfied.

     

    In addition, to the extent that Section
409A is applicable, (i) performance-based compensation shall also be contingent
on the satisfaction of pre-established organizational or individual performance
criteria relating to a performance period of at least 12 consecutive months in
which the Eligible Participant performs services and (ii) performance goals
shall be established not later than 90 calendar days after the beginning of any
performance period to which the performance goal relates, provided that the
outcome is substantially uncertain at the time the criteria are
established.

     

    
      
         

      

      
        - 24
-

        
          

        

      

      
         

      

    

    

     

    Acceleration

     

    14.5    
The
Administrator may, in its sole discretion (but subject to the limitations of and
compliance with Section 409A of the Code and Section 14.7 in connection
therewith), at any time (including, without limitation, prior to, coincident
with or subsequent to a Change of Control) determine that (a) all or a portion
of a Grantee’s Awards shall become fully or partially exercisable, and/or (b)
all or a part of the restrictions on all or a portion of the outstanding Awards
shall lapse, in each case, as of such date as the Administrator may, in its sole
discretion, declare.  The Administrator may discriminate among
Grantees and among Awards granted to a Grantee in exercising its discretion
pursuant to this Section 14.5.

     

    Compliance with Section
162(m) of the Code

     

    14.6    
Notwithstanding
any provision of this Plan to the contrary, if the Administrator determines that
compliance with Section 162(m) of the Code is required or desired, all Awards
granted under this Plan to Named Executive Officers shall comply with the
requirements of Section 162(m) of the Code.  In addition, in the event
that changes are made to Section 162(m) of the Code to permit greater
flexibility with respect to any Award or Awards under this Plan, the
Administrator may make any adjustments it deems appropriate.

     

    Compliance with Section 409A
of the Code

     

    14.7    
Notwithstanding
any provision of this Plan to the contrary, if any provision of this Plan or an
Award Agreement contravenes any regulations or Treasury guidance promulgated
under Section 409A of the Code or could cause an Award to be subject to the
interest and penalties under Section 409A of the Code, such provision of this
Plan or any Award Agreement shall be modified to maintain, to the maximum extent
practicable, the original intent of the applicable provision without violating
the provisions of Section 409A of the Code.  In addition, in the event
that changes are made to Section 409A of the Code to permit greater flexibility
with respect to any Award under this Plan, the Administrator may make any
adjustments it deems appropriate.

     

    Section 280G of the
Code

     

    14.8    
Notwithstanding
any other provision of this Plan to the contrary, unless expressly provided
otherwise in the Award Agreement, if the right to receive or benefit from an
Award under this Plan, either alone or together with payments that a Grantee has
a right to receive from the Company, would constitute a “parachute payment” (as
defined in Section 280G of the Code), all such payments shall be reduced to the
largest amount that shall result in no portion being subject to the excise tax
imposed by Section 4999 of the Code.

     

    Exercise of Award Following
Termination of Continuous Service

     

    14.9    
An Award
may not be exercised after the termination date of such Award set forth in the
Award Agreement and may be exercised following the termination of a Grantee’s
Continuous Service only to the extent provided in the Award
Agreement.  Where the Award Agreement permits a Grantee to exercise an
Award following the termination of the Grantee’s Continuous Service for a
specified period, the Award shall terminate to the extent not exercised on the
last day of the specified period or the last day of the original term of the
Award, whichever occurs first.

     

    
      
         

      

      
        - 25
-

        
          

        

      

      
         

      

    

    

     

    Cancellation of
Awards

     

    14.10    
In the
event a Grantee’s Continuous Services has been terminated for “Cause”, he or she
shall immediately forfeit all rights to any and all Awards
outstanding.  The determination that termination was for Cause shall
be final and conclusive.  In making its determination, the Board shall
give the Grantee an opportunity to appear and be heard at a hearing before the
full Board and present evidence on the Grantee’s behalf.  Should any
provision to this Section 14.10. be held to be invalid or illegal, such
illegality shall not invalidate the whole of this Section 14, but, rather, this
Plan shall be construed as if it did not contain the illegal part or narrowed to
permit its enforcement, and the rights and obligations of the parties shall be
construed and enforced accordingly.

     

    
      	
              15.  

            	
              ADDITIONAL TERMS IF
      THE COMPANY BECOMES LISTED ON A STOCK
  EXCHANGE

            

    

     

    15.1    
In the
event the Shares become listed on a stock exchange, and only to the extent
required by the rules of such stock exchange, then the following terms and
conditions shall apply to an Award in addition to those contained herein, as
applicable:

     

    
      	
              (a)  

            	
              the
      exercise price of an Award must not be lower than the Fair Market Value
      (without discount) of the Shares on the stock exchange at the time the
      Award is granted;

            

    

     

    
      	
              (b)  

            	
              the
      exercise price of an Award granted to an Insider cannot be reduced, or the
      term of the Award cannot be extended to benefit an Insider, unless the
      Company obtains Disinterested Shareholder
  Approval;

            

    

     

    
      	
              (c)  

            	
              the
      number of securities issuable to Insiders, at any time, under all of the
      Company’s security based compensation arrangements (whether entered into
      prior to or subsequent to such listing), cannot exceed 10% of the
      Company’s total issued and outstanding Common Stock, unless the Company
      obtains Disinterested Shareholder Approval;
and

            

    

     

    
      	
              (d)  

            	
              the
      number of securities issued to Insiders, within any one year period, under
      all of the Company’s security based compensation arrangements (whether
      entered into prior to or subsequent to such listing), cannot exceed 10% of
      the issued and outstanding Common Stock, unless the Company obtains
      Disinterested Shareholder Approval.

            

    

     

    
      
         

      

      
        - 26
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              16.  

            	
              PAYMENT FOR SHARE
      PURCHASES

            

    

     

    Payment

     

    16.1     
Payment
for Shares purchased pursuant to this Plan may be made:

     

    
      	
              (a)  

            	
              Cash.  By
      cash, cashier’s check or wire transfer or, at the discretion of the
      Administrator expressly for the Grantee and where permitted by law as
      follows:

            

    

     

    
      	
              (b)  

            	
              Surrender of
      Shares.  By surrender of shares of Common Stock of the
      Company that have been owned by the Grantee for more than six months, or
      lesser period if the surrender of shares is otherwise exempt from Section
      16 of the Exchange Act, (and, if such shares were purchased from the
      Company by use of a promissory note, such note has been fully paid with
      respect to such shares);

            

    

     

    
      	
              (c)  

            	
              Deemed Net-Stock
      Exercise.  By forfeiture of Shares equal to the value of
      the exercise price pursuant to a “deemed net-stock exercise” by requiring
      the Grantee to accept that number of Shares determined in accordance with
      the following formula, rounded down to the nearest whole
      integer:

            

    

     

    

    where:

    

    a  =           the
net Shares to be issued to Grantee;

    

    b  =           the
number of Awards being exercised;

    

    c  =           the
Fair Market Value of a Share; and

    

    d  =           the
Exercise price of the Awards; or

    

    
      	
              (d)  

            	
              Cashless
      Exercise.  By a “cashless exercise”, in which event the
      Company shall issue to the Grantee the number of Shares of Common Stock
      determined as follows:

            

    

     

    

    where:

    

    a  =           the
net Shares to be issued to Grantee;

    

    b  =           the
number of Awards being exercised;

    
      
         

      

      
        - 27
-

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              c  =

            	
              the
      average of the “Closing Sale Prices” of the Shares of Common Stock (as
      reported by Bloomberg Financial Markets) for the five trading days ending
      on the date immediately preceding the Exercise Date;
  and

            

    

    

    
      	
               
      

            	
              d  =

            	
              the
      Exercise price of the Award.

            

    

    

    For
purposes of such an Award, “Closing Sale Price” means, for
any security as of any date, the last trade price for such security on the
principal securities exchange or trading market for such security, as reported
by Bloomberg Financial Markets, or, if such exchange or trading market begins to
operate on an extended hours basis and does not designate the last trade price,
then the last trade price of such security prior to 4:00 p.m., New York City
time, as reported by Bloomberg Financial Markets, or if the foregoing do not
apply, the last trade price of such security in the over-the-counter market on
the electronic bulletin board for such security as reported by Bloomberg
Financial Markets, or, if no last trade price is reported for such security by
Bloomberg Financial Markets, the average of the bid prices, or the ask prices,
respectively, of any market makers for such security as reported in the “pink
sheets” by Pink Sheets LLC.  If the Closing Sale Price cannot be
calculated for a security on a particular date on any of the foregoing bases,
the Closing Sale Price of such security on such date shall be the fair market
value as mutually determined by the Company and the Grantee.  If the
Company and the Grantee are unable to agree upon the fair market value of such
security, then the Company shall, within two business days submit via facsimile
(a) the disputed determination of the Closing Sale Price to an independent,
reputable investment bank selected by the Company and approved by the Grantee or
(b) the disputed arithmetic calculation of the Shares of Common Stock to the
Company's independent, outside accountant.  The Company shall cause at
its expense the investment bank or the accountant, as the case may be, to
perform the determinations or calculations and notify the Company and the
Grantee of the results no later than ten business days from the time it receives
the disputed determinations or calculations.  Such investment bank’s
or accountant's determination or calculation, as the case may be, shall be
binding upon all parties absent demonstrable error.  All such
determinations shall be appropriately adjusted for any stock dividend, stock
split, stock combination or other similar transaction during the applicable
calculation period.  For purposes of Rule 144 promulgated under the
Securities Act, it is intended, understood and acknowledged that the Shares of
Common Stock issued in a cashless exercise transaction shall be deemed to have
been acquired by the Grantee, and the holding period for the shares shall be
deemed to have commenced, on the date the Award was originally issued (provided
that the United States Securities and Exchange Commission continues to take the
position that such treatment is proper at the time of such
exercise);

     

    
      
         

      

      
        - 28
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              (e)  

            	
              Broker-Assisted.  By
      delivering a properly executed exercise notice to the Company together
      with a copy of irrevocable instructions to a broker to deliver promptly to
      the Company the amount of sale or loan proceeds necessary to pay the
      exercise price and the amount of any required tax or other withholding
      obligations.

            

    

     

    Combination of
Methods

     

    16.2    
By any
combination of the foregoing methods of payment or any other consideration or
method of payment as shall be permitted by applicable corporate
law.

     

    
      	
              17.  

            	
              WITHHOLDING
      TAXES

            

    

     

    Withholding
Generally

     

    17.1    
Whenever
Shares are to be issued in satisfaction of Awards granted under this Plan or
Shares are forfeited pursuant to a “deemed net-stock exercise,” the Company may
require the Grantee to remit to the Company an amount sufficient to satisfy the
foreign, federal, state, provincial, or local income and employment tax
withholding obligations, including, without limitation, on exercise of an
Award.  When, under applicable tax laws, a Grantee incurs tax
liability in connection with the exercise or vesting of any Award, the
disposition by a Grantee or other person of an Award or an Option prior to
satisfaction of the holding period requirements of Section 422 of the Code, or
upon the exercise of a Non-Qualified Stock Option, the Company shall have the
right to require such Grantee or such other person to pay by cash, or check
payable to the Company, the amount of any such withholding with respect to such
transactions.  Any such payment must be made promptly when the amount
of such obligation becomes determinable.

     

    Stock for
Withholding

     

    17.2    
To the
extent permissible under applicable tax, securities and other laws, the
Administrator may, in its sole discretion and upon such terms and conditions as
it may deem appropriate, permit a Grantee to satisfy his or her obligation to
pay any such withholding tax, in whole or in part, with Shares up to an amount
not greater than the Company’s minimum statutory withholding rate for federal
and state tax purposes, including payroll taxes, that are applicable to such
supplemental taxable income.  The Administrator may exercise its
discretion, by (i) directing the Company to apply Shares to which the Grantee is
entitled as a result of the exercise of an Award, or (ii) delivering to the
Company Shares that have been owned by the Grantee for more than six months,
unless the delivery of Shares is otherwise exempt from Section 16 of the
Exchange Act.  A Grantee who has made an election pursuant to this
Section 17.2 may satisfy his or her withholding obligation only with Shares that
are not subject to any repurchase, forfeiture, unfulfilled vesting or other
similar requirements.  The Shares so applied or delivered for the
withholding obligation shall be valued at their Fair Market Value as of the date
of measurement of the amount of income subject to withholding.

     

    
      
         

      

      
        - 29
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              18.  

            	
              ADJUSTMENTS UPON
      CHANGES IN CAPITALIZATION

            

    

     

    In
General

     

    18.1    
Subject
to any required action by the shareholders of the Company, the number of Shares
covered by each outstanding Award, and the number of Shares which have been
authorized for issuance under the Plan but as to which no Awards have yet been
granted or which have been returned to the Plan, the exercise or purchase price
of each such outstanding Award, as well as any other terms that the
Administrator determines require adjustment shall be proportionately adjusted
for (i) any increase or decrease in the number of issued Shares resulting from a
stock split, reverse stock split, stock dividend, combination or
reclassification of the Shares, or (ii) any other increase or decrease in the
number of issued Shares effected without receipt of consideration by the
Company; provided, however that conversion of any convertible securities of the
Company shall not be deemed to have been effected without receipt of
consideration. The Administrator shall make the appropriate adjustments to (i)
the maximum number and/or class of securities issuable under this Plan; and (ii)
the number and/or class of securities and the exercise price per Share in effect
under each outstanding Award in order to prevent the dilution or enlargement of
benefits thereunder; provided, however, that the number of Shares subject to any
Award shall always be a whole number and the Administrator shall make such
adjustments as are necessary to insure Awards of whole Shares. Such adjustment
shall be made by the Administrator and its determination shall be final, binding
and conclusive.

     

    Company’s Right to Effect
Changes in Capitalization

     

    18.2   
The
existence of outstanding Awards shall not affect the Company’s right to effect
adjustments, recapitalizations, reorganizations or other changes in its or any
other corporation’s capital structure or business, any merger or consolidation,
any issuance of bonds, debentures, preferred or prior preference stock ahead of
or affecting the Shares, the dissolution or liquidation of the Company’s or any
other corporation’s assets or business or any other corporate act whether
similar to the events described above or otherwise.

     

    
      	
              19.  

            	
              CORPORATE
      TRANSACTIONS/CHANGES IN CONTROL/RELATED ENTITY
      DISPOSITIONS

            

    

     

    Company is Not the
Survivor

     

    19.1    
Subject
to Section 19.3 and except as may otherwise be provided in an Award Agreement,
the Administrator shall have the authority, in its absolute discretion,
exercisable either in advance of any actual or anticipated Corporate
Transaction, Change in Control or Related Entity Disposition in which the
Company is not the surviving corporation, or at the time of an actual Corporate
Transaction, Change in Control or Related Entity Disposition in which the
Company is not the surviving corporation (a) to cancel each outstanding Award
upon payment in cash to the Grantee of the amount by which any cash and the Fair
Market Value of any other property which the Grantee would have received as
consideration for the Shares covered by the Award if the Award had been
exercised before such Corporate Transaction, Change in Control or Related Entity
Disposition exceeds the exercise price of the Award, or (b) to negotiate to have
such Award assumed by the surviving corporation.  The determination as
to whether the Company is the surviving corporation is at the sole and absolute
discretion of the Administrator.

     

    
      
         

      

      
        - 30
-

        
          

        

      

      
         

      

    

    

     

    In
addition to the foregoing, in the event of a dissolution or liquidation of the
Company, or a Corporate Transaction or Related Entity Disposition in which the
Company is not the surviving corporation, the Administrator, in its absolute
discretion, may accelerate the time within which each outstanding Award may be
exercised.  Section 19.3 shall control with respect to any
acceleration in vesting in the event of Change of Control.

     

    The
Administrator shall also have the authority:

     

    
      	
              (a)  

            	
              to
      release the Awards from restrictions on transfer and repurchase or
      forfeiture rights of such Awards on such terms and conditions as the
      Administrator may specify; and

            

    

     

    
      	
              (b)  

            	
              to
      condition any such Award’s vesting and exercisability or release from such
      limitations upon the subsequent termination of the Continuous Service of
      the Grantee within a specified period following the effective date of the
      Corporate Transaction, Change in Control or Related Entity
      Disposition.

            

    

     

    Effective
upon the consummation of a Corporate Transaction, Change in Control or Related
Entity Disposition governed by this Section 19.1, all outstanding Awards under
this Plan not exercised by the Grantee or assumed by the successor corporation
shall terminate.

     

    Company is the
Survivor

     

    19.2    
In the
event of a Corporate Transaction, Change in Control or Related Entity
Disposition in which the Company is the surviving corporation, the Administrator
shall determine the appropriate adjustment of the number and kind of securities
with respect to which outstanding Awards may be exercised, and the exercise
price at which outstanding Awards may be exercised.  The Administrator
shall determine, in its sole and absolute discretion, when the Company shall be
deemed to survive for purposes of this Plan.  Subject to any contrary
language in an Award Agreement evidencing an Award, any restrictions applicable
to such Award shall apply as well to any replacement shares received by the
Grantee as a result.

     

    Change in
Control

     

    19.3    
If there
is a Change of Control, all outstanding Awards shall fully vest immediately upon
the Company’s public announcement of such a change.

     

    
      	
              20.  

            	
              PRIVILEGES OF STOCK
      OWNERSHIP

            

    

     

    No
Grantee shall have any of the rights of a stockholder with respect to any Shares
until the Shares are issued to the Grantee.  After Shares are issued
to the Grantee, the Grantee shall be a stockholder and have all the rights of a
stockholder with respect to such Shares, including the right to vote and receive
all dividends or other distributions made or paid with respect to such Shares;
provided, that if such Shares are Restricted Stock, then any new, additional or
different securities the Grantee may become entitled to receive with respect to
such Shares by virtue of a stock dividend, stock split or any other change in
the corporate or capital structure of the Company shall be subject to the same
restrictions as the Restricted Stock.  The Company shall issue (or
cause to be issued) such stock certificate promptly upon exercise of the
Award.

     

    
      
         

      

      
        - 31
-

        
          

        

      

      
         

      

    

    

     

    
      	
              21.  

            	
              RESTRICTION ON
      SHARES

            

    

     

    At the
discretion of the Administrator, the Company may reserve to itself and/or its
assignee(s) in the Award Agreement that the Grantee not dispose of the Shares
for a specified period of time, or that the Shares are subject to a right of
first refusal or a right to repurchase by the Company at the Shares’ Fair Market
Value at the time of sale.  The terms and conditions of any such
rights or other restrictions shall be set forth in the Award Agreement
evidencing the Award.

     

    
      	
              22.  

            	
              CERTIFICATES

            

    

     

    All
certificates for Shares or other securities delivered under this Plan shall be
subject to such stock transfer orders, legends and other restrictions as the
Administrator may deem necessary or advisable, including restrictions under any
applicable federal, state or foreign securities law, or any rules, regulations
and other requirements of the SEC or any stock exchange or automated quotation
system upon which the Shares may be listed or quoted.

     

    
      	
              23.  

            	
              ESCROW; PLEDGE OF
      SHARES

            

    

     

    To
enforce any restrictions on a Grantee’s Shares, the Administrator may require
the Grantee to deposit all certificates representing Shares, together with stock
powers or other instruments of transfer approved by the Administrator,
appropriately endorsed in blank, with the Company or an agent designated by the
Company to hold in escrow until such restrictions have lapsed or terminated, and
the Administrator may cause a legend or legends referencing such restrictions to
be placed on the certificates.

     

    
      	
              24.  

            	
              SECURITIES LAW AND
      OTHER REGULATORY COMPLIANCE

            

    

     

    Compliance With Applicable
Law

     

    24.1    
An Award
shall not be effective unless such Award is in compliance with all applicable
federal and state securities laws, rules and regulations of any governmental
body, and the requirements of any stock exchange or automated quotation system
upon which the Shares may then be listed or quoted, as they are in effect on the
Grant Date and also on the date of exercise or other
issuance.  Notwithstanding any other provision in this Plan, the
Company shall have no obligation to issue or deliver certificates for Shares
under this Plan prior to (i) obtaining any approvals from governmental agencies
that the Company determines are necessary or advisable; and/or (ii) completion
of any registration or other qualification of such Shares under any state or
federal laws or rulings of any governmental body that the Company determines to
be necessary or advisable.  The Company shall be under no obligation
to register the Shares with the Securities Exchange Commission or to effect
compliance with the registration, qualification or listing requirements of any
state securities laws, stock exchange or automated quotation system, and the
Company shall have no liability for any inability or failure to do
so.  Evidences of ownership of Shares acquired pursuant to an Award
shall bear any legend required by, or useful for purposes of compliance with,
applicable securities laws, this Plan or the Award Agreement.

     

    
      
         

      

      
        - 32
-

        
          

        

      

      
         

      

    

    

     

    During
any time when the Company has a class of equity security registered under
Section 12 of the Exchange Act, it is the intent of the Company that Awards
pursuant to this Plan and the exercise of Awards granted hereunder shall qualify
for the exemption provided by Rule 16b-3 under the Exchange Act.  To
the extent that any provision of this Plan or action by the Board or the
Administrator does not comply with the requirements of Rule 16b-3, it shall be
deemed inoperative to the extent permitted by law and deemed advisable by the
Board or the Administrator, and shall not affect the validity of this
Plan.  In the event that Rule 16b-3 is revised or replaced, the
Administrator may exercise its discretion to modify this Plan in any respect
necessary to satisfy the requirements of, or to take advantage of any features
of, the revised exemption or its replacement.

     

    Investment
Representation

     

    24.2    
As a
condition to the exercise of an Award, the Company may require the person
exercising such Award to represent and warrant at the time of any such exercise
that the Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel for
the Company, such a representation is required by any Applicable
Laws.

     

    
      	
              25.  

            	
              NO OBLIGATION TO
      EMPLOY

            

    

     

    Nothing
in this Plan or any Award granted under this Plan shall confer or be deemed to
confer on any Grantee any right to continue in the employ of, or to continue any
other relationship with, the Company or to limit in any way the right of the
Company to terminate such Grantee’s employment or other relationship at any
time, with or without Cause.

     

    
      	
              26.  

            	
              EFFECTIVE DATE AND
      TERM OF PLAN

            

    

     

    This
Amended Plan shall become effective upon the earlier to occur of its adoption by
the Board or its approval by the shareholders of the Company. It shall continue
in effect for a term of ten years from the date of such amendment unless sooner
terminated.

     

    
      	
              27.  

            	
              SHAREHOLDER
      APPROVAL

            

    

     

    If
required under Applicable Laws, this Plan shall be subject to approval by the
shareholders of the Company.  The Administrator may grant Awards under
this Plan prior to approval by the shareholders.

     

    
      	
              28.  

            	
              AMENDMENT, SUSPENSION
      OR TERMINATION OF THIS PLAN OR
AWARDS

            

    

     

    The Board
may amend, suspend or terminate this Plan at any time and for any
reason.  To the extent necessary to comply with Applicable Laws, the
Company shall obtain shareholder approval of any Plan amendment in such a manner
and to such a degree as required.  Shareholder approval shall be
required for the following types of amendments to this Plan: (i) any increase in
Maximum Number of Shares issuable under the Plan except for a proportional
increase in the

     

    
      
         

      

      
        - 33
-

        
          

        

      

      
         

      

    

    

     

    Maximum
Number as a result of stock split or stock dividend, or a change from a fixed
Maximum Number of Shares to a fixed maximum percentage; (ii) any change to those
persons who are entitled to become participants under the Plan which would have
the potential of broadening or increasing Insider participation; or (iii) the
addition of any form of financial assistance or amendment to a financial
assistance provision which is more favorable to Grantees.

     

    Further,
the Board may, in its discretion, determine that any amendment should be
effective only if approved by the shareholders even if such approval is not
expressly required by this Plan or by law.  No Award may be granted
during any suspension of this Plan or after termination of this
Plan.

     

    Any
amendment, suspension or termination of this Plan shall not affect Awards
already granted, and such Awards shall remain in full force and effect as if
this Plan had not been amended, suspended or terminated, unless mutually agreed
otherwise between the Grantee and the Administrator, which agreement must be in
writing and signed by the Grantee and the Company.  At any time and
from time to time, the Administrator may amend, modify, or terminate any
outstanding Award or Award Agreement without approval of the Grantee; provided
however, that subject to the applicable Award Agreement, no such amendment,
modification or termination shall, without the Grantee’s consent, reduce or
diminish the value of such Award determined as if the Award had been exercised,
vested, cashed in or otherwise settled on the date of such amendment or
termination.

     

    Notwithstanding
any provision herein to the contrary, the Administrator shall have broad
authority to amend this Plan or any outstanding Award under this Plan without
approval of the Grantee to the extent necessary or desirable: (i) to comply
with, or take into account changes in, applicable tax laws, securities laws,
accounting rules and other applicable laws, rules and regulations; or (ii) to
ensure that an Award is not subject to interest and penalties under Section 409A
of the Code or the excise tax imposed by Section 4999 of the Code.

     

    Further,
notwithstanding any provision herein to the contrary, and subject to Applicable
Law, the Administrator may, in its absolute discretion, amend or modify this
Plan: (i) to make amendments which are of a “housekeeping” or clerical nature;
(ii) to change the vesting provisions of an Award granted hereunder, as
applicable; (iii) to change the termination provision of an Award granted
hereunder, as applicable, which does not entail an extension beyond the original
expiry date of such Award; and (iv) the addition of a cashless exercise feature,
payable in cash or securities, which provides for a full deduction of the number
of underlying securities from the Maximum Number.

     

    
      	
              29.  

            	
              RESERVATION OF
      SHARES

            

    

     

    The
Company, during the term of this Plan, shall at all times reserve and keep
available such number of Shares as shall be sufficient to satisfy the
requirements of this Plan.

     

    
      
         

      

      
        - 34
-

        
          

        

      

      
         

      

    

    

     

    The
Shares to be issued hereunder upon exercise of an Award may be either authorized
but unissued; supplied to the Plan through acquisitions of Shares on the open
market; Shares forfeited back to the Plan; Shares surrendered in payment of the
exercise price of an Award; or Shares withheld for payment of applicable
employment taxes and/or withholding obligations resulting from the exercise of
an Award.

     

    The
inability of the Company to obtain authority from any regulatory body having
jurisdiction, which authority is deemed by the Company’s counsel to be necessary
to the lawful issuance and sale of any Shares hereunder, shall relieve the
Company of any liability in respect of the failure to issue or sell such Shares
as to which such requisite authority shall not have been obtained.

     

    
      	
              30.  

            	
              EXCHANGE AND BUYOUT OF
      AWARDS

            

    

     

    The
Administrator may, at any time or from time to time, authorize the Company, with
the consent of the respective Grantees, to issue new Awards in exchange for the
surrender and cancellation of any or all outstanding Awards.  The
Administrator may at any time buy from a Grantee an Award previously granted
with payment in cash, Shares (including Restricted Stock) or other
consideration, based on such terms and conditions as the Administrator and the
Grantee may agree.

     

    
      	
              31.  

            	
              APPLICABLE TRADING
      POLICY

            

    

     

    The
Administrator and each Eligible Participant will ensure that all actions taken
and decisions made by the Administrator or an Eligible Participant, as the case
may be, pursuant to this Plan comply with any Applicable Laws and policies of
the Company relating to insider trading or “blackout” periods.

     

    
      	
              32.  

            	
              GOVERNING
      LAW

            

    

     

    The Plan
shall be governed by the laws of the State of Nevada, U.S.A.; provided, however,
that any Award Agreement may provide by its terms that it shall be governed by
the laws of any other jurisdiction as may be deemed appropriate by the parties
thereto.

     

    
      	
              33.  

            	
              MISCELLANEOUS

            

    

     

    Except as
specifically provided in a retirement or other benefit plan of the Company or a
Related Entity, Awards shall not be deemed compensation for purposes of
computing benefits or contributions under any retirement plan of the Company or
a Related Entity, and shall not affect any benefits under any other benefit plan
of any kind or any benefit plan subsequently instituted under which the
availability or amount of benefits is related to level of compensation. The Plan
is not a “Retirement Plan” or “Welfare Plan” under the Employee Retirement Income Security
Act of 1974, as amended.

     

    
      
         

      

      
        - 35
-

        
          

        

      

      
         

      

    

    SUBPART
A

     

    STOCK AND DEFERRED STOCK
UNITS FOR ELIGIBLE DIRECTORS

     

    A.        Stock
Award.  The Administrator shall pay Eligible Remuneration to
each Director pursuant to an Award Agreement.

     

    B.         Election.  Further,
the Administrator may, in its sole discretion, permit each Eligible Director to
receive all or any portion of his Eligible Remuneration during the Remuneration
Period in the form of Deferred Stock Units under this Plan (an
“Election”).  All deferrals pursuant to such an Election shall be
evidenced by an Award Agreement.

     

                
For purposes of this Subpart A, the following definitions shall
apply:

     

    “Annual Retainer” for a
particular Director means the retainer (including any additional amounts payable
for serving as lead Director or on any committee of the Board), payable to that
Director for serving as a Director for the relevant Remuneration Period, as
determined by the Board;

     

    “Attendance Fee” means amounts
payable annually to a Director as a Board meeting attendance fee or a committee
meeting attendance fee, or any portion thereof;

     

    “Canadian Director” means a
Director who is a resident of Canada for the purposes of the Canadian Tax Act,
and whose income from employment by the Company or Related Entity is subject to
Canadian income tax, notwithstanding any provision of the Canada-United States
Income Tax Convention (1980), as amended;

     

    “Canadian Tax Act” and
“Canadian Tax Regulations” means respectively the Income Tax Act (Canada), as
amended and the Income Tax Regulation promulgated thereunder, as
amended;

     

    “Deferred Stock Unit” means a
right granted by the Company to an Eligible Director to receive, on a deferred
payment basis, Shares under this Plan;

     

    “Eligible Director” is any
Director of this Company or Related Entity that the Administrator determines is
eligible to elect to receive Deferred Stock Units under this Plan;

     

    “Eligible Remuneration” means
all amounts payable to an Eligible Director in Shares, including all or part of
amounts payable in satisfaction of the Annual Retainer, Attendance Fees or any
other fees relating to service on the Board which are payable to an Eligible
Director or in satisfaction of rights or property surrendered by an Eligible
Director to the Company; it being understood that the amount of Eligible
Remuneration payable to any Eligible Director may be calculated by the
Administrator in a different manner than Eligible Remuneration payable to
another Eligible Director in its sole and absolute discretion;

     

    “Prescribed Plan or
Arrangement” means a prescribed plan or arrangement as defined in
s.6801(d) of the Canadian Tax Regulation;

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    “Remuneration Period” means, as
applicable, (a) the period commencing on the Effective Date of this Plan and
ending on the last day of the calendar year in which the Effective Date occurs;
and (b) thereafter each subsequent calendar year, or where the context requires,
any portion of such period; and

     

    “Salary Deferral Arrangement”
means a salary deferral arrangement as defined in the Canadian Tax
Act.

     

    1.           Election.  An
Eligible Director who desires to defer receipt of all or a portion of his or her
Eligible Remuneration in any calendar year shall make such election in writing
to the Company specifying:

     

    (a)           the
dollar amount or percentage of Eligible Remuneration to be deferred;
and

     

    (b)           the
deferral period.

     

    Otherwise,
such election must be made before the first day of the calendar year in which
the Eligible Remuneration shall be payable, however a newly appointed Eligible
Director shall be eligible to defer payment of future Eligible Remuneration by
providing written election to the Company within 30 calendar days of his or her
appointment to the Board of Directors.  The elections made pursuant to
this Section shall be irrevocable with respect to Eligible Remuneration to which
such elections pertain and shall also apply to subsequent Eligible Remuneration
payable in future calendar years unless such Eligible Director notifies the
Company in writing, before the first day of the applicable calendar year, that
he or she desires to change such election.

     

    If the
Eligible Director does not timely deliver an election in respect of a particular
Remuneration Period, the Eligible Director will receive the Eligible
Remuneration as provided for in the Award Agreement.

     

    2.           Determination Of Deferred
Stock Units.  The Company will maintain a separate account for
each Eligible Director to which it will quarterly credit Deferred Stock Units at
the end of March, June, September and December, or as otherwise determined by
the Administrator, the Deferred Stock Units granted to the Eligible Director for
the relevant Remuneration Period.  The number of Deferred Stock Units
(including fractional Deferred Stock Units, computed to three digits) to be
credited to an account for an Eligible Director will be determined on the date
approved by the Administrator by dividing the appropriate amount of Eligible
Remuneration to be deferred into Deferred Stock Units by the Fair Market Value
on that date.

     

    3.           No Voting
Rights.  The holders of Deferred Stock Units shall have no
rights as stockholders of the Company.

     

    
      
         

      

      
        - 2
-

        
          

        

      

      
         

      

    

    

     

    4.           Dividend
Equivalency.  The Company will, on any date on which a cash or
stock dividend is paid on its outstanding Shares, credit to each Eligible
Director’s account that number of additional Deferred Stock Units (including
fractional Deferred Stock Units, computed to three digits) calculated by (i)
multiplying the amount of the dividend per Share by the number of Deferred Stock
Units in the account as of the record date for payment of the dividend, and (ii)
dividing the amount obtained in (i) by the Fair Market Value on the date on
which the dividend is paid.  (See Section 13 of the Plan, Dividend
Equivalent Right).

     

    5.           Eligible Director’s
Account.  A written confirmation of the balance in each
Eligible Directors’ Account will be sent by the Company to the Eligible Director
upon request of the Eligible Director.

     

    6.           Creditor’s
Rights.  A holder of Deferred Stock Units shall have no rights
other than those of a general creditor of the Company.  Deferred Stock
Units represent an unfunded and unsecured obligation of the Company, subject to
the terms and condition of the applicable Award Agreement.

     

    7.           Settlement of Deferred Stock
Units.  Subject to Section 8, each Deferred Stock Unit shall be
paid and settled by the issuance of Restricted or unrestricted Shares in
accordance with the Award Agreement and if such settlement is subject to Section
409A of the Code only upon any one or more of the following as provided for in
the Award Agreement:

     

    
      	
              (a)  

            	
              a
      specific date or date determinable by a fixed
  schedule;

            

    

     

    
      	
              (b)  

            	
              upon
      the Eligible Director’s termination of Continuous Services to the extent
      the same constitutes a separation from services for the purposes of
      Section 409A of the Code except that if an Eligible Director is a “key
      employee” as defined in Section 409A of the Code for such purposes, then
      payment or settlement shall occur 6 months following such separation of
      service;

            

    

     

    
      	
              (c)  

            	
              as
      a result of the Eligible Director’s death or Disability;
  or

            

    

     

    
      	
              (d)  

            	
              in
      connection with or as a result of a Change in Control in compliance with
      409A of the Code.

            

    

     

    The Company will issue one Share for
each whole Deferred Stock Unit credited to the Eligible Director’s account (net
of any applicable withholding tax as provided for in this Plan).  Such
payment shall be made by the Company as soon as reasonably possible following
the settlement date.  Fractional Shares shall not be issued, and where
the Eligible Director would be entitled to receive a fractional Shares in
respect of any fractional Deferred Stock Unit, the Company shall pay to such
Eligible Director, in lieu of such fractional Shares, cash equal to the Fair
Market Value of such fractional Shares calculated as of the day before such
payment is made, net of any applicable withholding tax.

     

    
      
         

      

      
        - 3
-

        
          

        

      

      
         

      

    

    

     

    8.           Canadian
Directors.  If a Deferred Stock Unit is granted to an Eligible
Director who is a Canadian Director would otherwise constitute a Salary Deferred
Arrangement, the Award Agreement pertaining to that Deferred Stock Unit shall
contain such other or additional terms as will cause the Deferred Stock Unit to
be a Prescribed Plan or Arrangement.

     

    9.           Issuance of Stock
Certificates.  A stock certificate or certificates shall be
registered and issued in the name of the holder of Deferred Stock Units and
delivered to such holder as soon as practicable after such Deferred Stock Units
have become payable or satisfied in accordance with the terms of the
Plan

     

    10.           Non-Exclusivity.  Nothing
in this Subpart A shall prohibit the Administrator from making discretionary
Awards to Eligible Directors pursuant to the other provisions of this Plan or
outside this Plan, not otherwise inconsistent with these
provisions.

     

    11.           Defined
Terms.  Capitalized terms used in this Subpart A and not
defined herein have the meaning give in the Plan.

     

    
      
         

      

      
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