Document:

AMENDMENT
AND AGREEMENT

    

    This
AMENDMENT AND AGREEMENT
(this “Agreement”) is
entered into effective for all purposes as of June 30, 2010 by and between Bohai
Pharmaceuticals Group, Inc., a Nevada corporation (the “Company”), and Euro Pacific
Capital, Inc. (the “Investor
Representative”).

    

    WHEREAS, on January 5, 2010,
the Company consummated a $12,000,000 financing (the “Offering”) with certain
accredited investors (the “Investors”) whereby the
Company issued 6,000,000 units at $2.00 per unit, with each unit consisting of a
$2.00 principal amount, two year convertible note (collectively, the “Notes”) and a three year
common stock purchase warrant to purchase one share of the Company’s common
stock, par value $0.001 per share (the “Common Stock”) at $2.40 per
share, subject to certain conditions (collectively, the “Warrants”);

    

    WHEREAS, on January 5, 2010,
the Company issued an aggregate of 600,000 common stock purchase warrants,
containing terms identical to the Warrants, to the placement agents for the
Offering or their affiliates (the “Agent Warrants”);

    

    WHEREAS, pursuant to Section
2.8 of that certain Securities Purchase Agreement, dated January 5, 2010,
between the Company and the Investors (the “SPA”), each Investor duly
appointed the Investor Representative as such Investor’s true and lawful agent
and attorney-in-fact to, among other matters, waive any terms and conditions of
the Notes and Warrants and to be such Investor’s exclusive representative with
respect to any matter, suit, claim, action or proceeding arising with respect to
any transaction contemplated by the Notes and the Warrants (the “Power of Attorney”);
and

    

    WHEREAS, the Company and the
Investor Representative, exercising the Power of Attorney on behalf of the
Investors, desire to amend certain provisions of the Notes and Warrants and also
to amend the terms of the Agent Warrants on the terms set forth
herein.

    

    NOW, THEREFORE, in
consideration of the mutual covenants and agreements set forth herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and pursuant to the applicable provisions of the SPA, the
Notes and the Warrants, the parties hereby amend the Notes, Warrants and Agent
Warrants and otherwise agree as follows:

    

    1.           Amendments.  The
Investor Representative and the Company hereby amend the Notes, Warrants and
Agent Warrants as follows:

    

    (a)          Section
5(c) of the Notes (Adjustments to Conversion
Price) is hereby deleted in its entirety and is and shall be of no
further force and effect.

    

    (b)          Section
9 of the Warrants (Certain Adjustments to
Exercise Price) is hereby deleted in its entirety and is and shall be of
no further force and effect.

    

    (c)          Section
9 of the Agent Warrants (Certain Adjustments to
Exercise Price) is hereby deleted in its entirety and is and shall be of
no further force and effect.

    

    (d)          A
new Section 5(f) is hereby added to the Notes, as follows:

    

    “(f)         No Net Cash
Settlement.  In no event will any Holder of this Note be
entitled to receive a net-cash settlement in lieu of physical settlement in
shares of Common Stock or other securities of the Company, regardless of whether
any of such Holder’s Shares are registered pursuant to an effective registration
statement.”

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (e)          A
new Section 9(d) is hereby added to the Warrants, as follows:

    

    “(d)        No Net Cash
Settlement.  In no event will any Holder of this Warrant be
entitled to receive a net-cash settlement in lieu of physical settlement in
shares of Common Stock or other securities of the Company, regardless of whether
any of such Holder’s Warrant Shares are registered pursuant to an effective
registration statement.”

    

    (f)           A
new Section 9(d) is hereby added to the Agent Warrants, as follows:

    

    “(d)        No Net Cash
Settlement.  In no event will any Holder of this Warrant be
entitled to receive a net-cash settlement in lieu of physical settlement in
shares of Common Stock or other securities of the Company, regardless of whether
any of such Holder’s Warrant Shares are registered pursuant to an effective
registration statement.”

    

    2.           Agreements.  In
consideration of the amendments to the Notes, Warrants and Agent implemented
hereby, the Company hereby agrees as follows:

    

    (a)          Until
the Covenant Expiration Date (as defined below), and except for Excluded
Issuances (as defined below), the Company shall not issue any shares of Common
Stock, or any securities convertible into or exchangeable or exercisable for,
directly or indirectly, shares of Common Stock at a price per share of less than
$2.20 per share.

    

    (b)          Until
the Covenant Expiration Date, and except for Permitted Transfers (as defined
below), no: (i) officer of the Company, (ii) director of the Company or (iii)
stockholder of the Company holding in excess of 5% of the outstanding shares of
Common Stock that is affiliated with any officer or director of the Company
shall sell, assign, transfer or otherwise dispose of any shares of Common Stock,
or any securities convertible into or exchangeable or exercisable for, directly
or indirectly, shares of Common Stock at a price per share of less than $2.20
per share.

    

    (c)           As
used herein, the term “Covenant
Expiration Date” means the earlier of: (i) January 5, 2013 or (ii) the
date on which, collectively with any prior conversions or exercises of Notes and
Warrants, 75% of the principal face value of the Notes in the aggregate have
been converted into shares of Common Stock and Warrants
representing, in the aggregate, 75% of the aggregate shares of Common Stock
underlying the Warrants have been exercised.  For the avoidance of
doubt, the exercise or non-exercise of the Agent Warrants shall not effect the
determination of the Covenant Expiration Date.

    

    (d)          As
used herein, the term “Excluded
Issuances” means securities of the Company (including shares of Common
Stock) issued in connection with: (i) a merger, acquisition or consolidation of
or by the Company or its affiliates, (ii) a bona fide joint venture, strategic
license or similar business partnering arrangements of the Company or its
affiliates, (iii) any bona fide stock or option compensation plan, agreement or
arrangement with officers, directors, employees or consultants of the Company or
its affiliates; and (iv) any share split, share dividend, recapitalization or
similar transaction by the Company for which adjustment to the conversion price
of the Notes or the exercise price of the Warrants is made pursuant to the terms
of the Notes and the Warrants; provided, however, in each
case that the any transaction or arrangement described in this Section 2(d)
shall not be primarily for the purpose of raising capital from person or entity
whose primary business is investing in securities.

    

    (e)           As
used herein, the term “Permitted Transfers” means
transfers or gifts during the lifetime of the applicable person or, on death, by
will or intestacy to the applicable person’s immediate family or to a trust, the
beneficiaries of which are exclusively the applicable person and/or a member or
members of the applicable person’s immediate family.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    3.           Ratification.  Except
as expressly amended by this Agreement, the terms and conditions of the Notes,
Warrants and Agent Warrants are hereby confirmed and shall remain in full force
and effect without impairment or modification.

    

    4.           Power of
Attorney.  The Investor Representative represents and warrants
that: (a) the Power of Attorney is in full force and effect as of the date
hereof; (b) it has, pursuant to the Power of Attorney, the full power and
authority to enter into this Agreement and to bind each of the Investors to the
terms and conditions hereof; and (c) has received no notice regarding and is not
otherwise aware that any Investor has revoked or modified, or sought or desires
to revoke or modify, the Power of Attorney with respect to such Investor or any
Investor.  The Investor Representative agrees to indemnify and hold
harmless the Company and its directors, officers, employees and agents from and
against any and all losses, claims, damages, liabilities and expenses (including
without limitation reasonable attorney fees and disbursements and other expenses
incurred in connection with investigating, preparing or defending any action,
claim or proceeding, pending or threatened and the costs of enforcement thereof)
to which such persons may become subject as a result of any breach of the
representation contained in this Section 4, and will reimburse any such persons
for all such amounts as they are incurred by such persons.

    

    5.           Conflict.  In
the event of any conflict between any Note, Warrant or Agent Warrant and this
Agreement, the terms of this Agreement shall govern.

    

    6.           Binding
Effect.  The parties acknowledge and agree that this Agreement
complies with all of the applicable terms and conditions of the Notes and
Warrants that are necessary to effect an amendment to the Notes and Warrants and
therefore, upon the execution and delivery hereof by the parties, this Agreement
shall have such binding effect.

    

    7.           Governing Law;
Venue.  All questions concerning the construction, validity,
enforcement and interpretation of the this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflicts of law
thereof.  Each party agrees that all legal proceedings concerning the
interpretations, enforcement and defense of the transactions contemplated by
this Agreement (whether brought against a party hereto or its respective
affiliates, directors, officers, shareholders, employees or agents) shall be
commenced exclusively in the state and federal courts sitting in the City of New
York.  Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the City of New York,
New York for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein (including with
respect to the enforcement of this Agreement), and hereby irrevocably waives,
and agrees not to assert in any suit, action or proceeding, any claim that it is
not personally subject to the jurisdiction of any such court, that such suit,
action or proceeding is improper.  Each party hereto hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof via
registered or certified mail or overnight delivery (with evidence of delivery)
to such party at the address in effect for notices to it under this Agreement
and agrees that such service shall constitute good and sufficient service of
process and notice thereof.  Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by
law.  EACH PARTY HERETO (INCLUDING ITS AFFILIATES, AGENTS, OFFICERS,
DIRECTORS AND EMPLOYEES) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    8.           Counterparts.  This
Agreement may be executed in any number of counterparts, in PDF format or by
facsimile, each of which shall be deemed to be an original, and all of which
taken together shall constitute one and the same instrument. 

    

    [Signature
Page Follows]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be duly executed and delivered on
their behalf as of the date first above written.

    

    
      
        
          	
                  BOHAI
      PHARMACEUTICALS GROUP, INC.

                
	 
      	 
      
	
                  By: 

                	
                  /s/ Hongwei Qu

                
	 
      	
                  Name:  Hongwei
      Qu

                
	 
      	
                  Title:    President
      and CEO

                
	 
      	 
      
	
                  EURO PACIFIC CAPITAL,
      INC., as Investor Representative

                  and
      on behalf of the Agent Warrant holders

                
	 
      	 
      
	
                  By:

                	
                  /s/ Gordon McBean

                
	 
      	
                  Name:  Gordon
      McBean

                
	 
      	
                  Title:    Head
      of Capital Markets

                

        

      

    

    

    
      
        	
                Acknowledged
      and Agreed with respect to its Agent Warrants:

              
	 
      
	
                CHARDAN
      CAPITAL MARKETS, LLC

              
	 
      
	
                By: 

              	
                /s/ George Kaufman

              
	 
      	
                Name:  George
      Kaufman

              
	 
      	
                Title:Unassociated Document

     

    Exhibit
10.1

    

    Nektar
Therapeutics

    Employee
Stock Purchase Plan

     

    Adopted
by the Board of Directors February 10, 1994

    Approved
by  Stockholders February 18, 1994

    Amended
and Restated May 10, 2002

    Approved
by  Stockholders June 25, 2002

    Amended
and Restated September 15, 2009

    Amended
and Restated March 23, 2010

    Approved
by  Stockholders June 29, 2010

    

    
      	
              1.

            	
              Purpose.

            

    

     

    (a)           The
purpose of the Plan is to provide a means by which Employees of the Company and
certain designated Related Corporations may be given an opportunity to purchase
shares of the Common Stock of the Company.

     

    (b)           The
Company, by means of the Plan, seeks to retain the services of such Employees,
to secure and retain the services of new Employees and to provide incentives for
such persons to exert maximum efforts for the success of the Company and its
Related Corporations.

     

    (c)           The
Company intends that the Purchase Rights be considered options issued under an
Employee Stock Purchase Plan.

     

    
      	
              2.

            	
              Definitions.

            

    

     

    (a)           “Board” means the Board of
Directors of the Company.

     

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

     

    (c)           “Committee” means a committee
appointed by the Board in accordance with Section 3(c) of the
Plan.

     

    (d)           “Common
Stock” means the common stock of the Company.

     

    (e)           “Company”
means Inhale Therapeutic Systems, Inc., a Delaware corporation.

     

    (f)           “Contributions”
means the payroll deductions, and other additional payments specifically
provided for in the Offering, that a Participant contributes to fund the
exercise of a Purchase Right. A Participant may make additional payments into
his or her account, if specifically provided for in the Offering, and then only
if the Participant has not already had the maximum permitted amount through
payroll deductions withheld during the Offering.

     

    (g)           “Corporate
Transaction” means the occurrence, in a single transaction or in a series
of related transactions, of any one or more of the following
events:

     

    (i)           a
sale, lease, license or other disposition of all or substantially all of the
consolidated assets of the Company;

     

    (ii)           a
sale or other disposition of at least ninety percent (90%) of the outstanding
securities of the Company;

     

    (iii)           a
merger, consolidation or similar transaction following which the Company is not
the surviving corporation; or

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (iv)           a
merger, consolidation or similar transaction following which the Company is the
surviving corporation but the shares of Common Stock outstanding immediately
preceding the merger, consolidation or similar transaction are converted or
exchanged by virtue of the merger, consolidation or similar transaction into
other property, whether in the form of securities, cash or
otherwise.

     

    (h)           “Director” means a member of the
Board.

     

    (i)           “Eligible
Employee” means an Employee who
meets the requirements set forth in the Offering for eligibility to participate
in the Offering, provided that such Employee also meets the requirements for
eligibility to participate set forth in the Plan.

     

    (j)           “Employee” means any person,
including Officers and Directors, who is employed for purposes of Section
423(b)(4) of the Code by the Company or a Related
Corporation.  Neither service as a Director nor payment of a
director’s fee shall be sufficient to make an individual an Employee of the
Company or a Related Corporation.

     

    (k)           “Employee Stock
Purchase Plan” means a plan that
grants Purchase Rights intended to be options issued under an “employee stock
purchase plan,” as that term is defined in Section 423(b) of the
Code.

     

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

     

    (m)           “Fair Market
Value” means the value of a
security, as determined in good faith by the Board.  If the security
is listed on any established stock exchange or traded on the Nasdaq National
Market or the Nasdaq SmallCap Market, the Fair Market Value of the security,
unless otherwise determined by the Board, shall be the closing
sales price (rounded up where necessary to the nearest whole cent) for such
security (or the closing bid, if no sales were reported) as quoted on such
exchange or market (or the exchange or market with the greatest volume of
trading in the relevant security of the Company) on the Trading Day of the
relevant determination date, as reported in The Wall Street Journal or
such other source as the Board deems reliable.

     

    (n)           “Offering” means the grant of
Purchase Rights to purchase shares of Common Stock under the Plan to Eligible
Employees.

     

    (o)           “Offering
Date” means a date selected by the Board for an Offering to
commence.

     

    (p)           “Officer” means a person who is an
officer of the Company within the meaning of Section 16 of the Exchange Act and
the rules and regulations promulgated thereunder.

     

    (q)           “Participant” means an Eligible
Employee who holds an outstanding Purchase Right granted pursuant to the
Plan.

     

    (r)           “Plan” means this Inhale
Therapeutic Systems, Inc. Employee Stock Purchase Plan, as amended and restated
June 29, 2010.

     

    (s)           “Purchase
Date” means
one or more dates during an Offering established by the Board on which Purchase
Rights shall be exercised and as of which purchases of shares of Common Stock
shall be carried out in accordance with such Offering.

     

    (t)           “Purchase
Period” means a period of time specified within an Offering beginning on
the Offering Date or on the next day following a Purchase Date within an
Offering and ending on a Purchase Date.  An Offering may consist of
one or more Purchase Periods.

     

    (u)            “Purchase
Right” means an option to
purchase shares of Common Stock granted pursuant to the Plan.

     

    (v)           “Related
Corporation” means any parent
corporation or subsidiary corporation, whether now or hereafter existing, as
those terms are defined in Sections 424(e) and (f), respectively, of the
Code.

     

    (w)           “Securities
Act” means
the Securities Act of 1933, as amended.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (x)           “Trading
Day” means any
day the exchange(s) or market(s) on which shares of Common Stock are listed,
whether it be any established stock exchange, the Nasdaq National Market, the
Nasdaq SmallCap Market or otherwise, is open for trading.

     

    
      	
              3.

            	
              Administration.

            

    

     

    (a)           The
Board shall administer the Plan unless and until the Board delegates
administration to a Committee, as provided in Section 3(c).  Whether
or not the Board has delegated administration, the Board shall have the final
power to determine all questions of policy and expediency that may arise in the
administration of the Plan.

     

    (b)           The
Board (or the Committee) shall have the power, subject to, and within the
limitations of, the express provisions of the Plan:

     

    (i)           To
determine when and how Purchase Rights to purchase shares of Common Stock shall
be granted and the provisions of each Offering of such Purchase Rights (which
need not be identical).

     

    (ii)           To
designate from time to time which Related Corporations of the Company shall be
eligible to participate in the Plan.

     

    (iii)           To
construe and interpret the Plan and Purchase Rights, and to establish, amend and
revoke rules and regulations for the administration of the Plan.  The
Board, in the exercise of this power, may correct any defect, omission or
inconsistency in the Plan, in a manner and to the extent it shall deem necessary
or expedient to make the Plan fully effective.

     

    (iv)           To
amend the Plan as provided in Section 15.

     

    (v)           Generally,
to exercise such powers and to perform such acts as it deems necessary or
expedient to promote the best interests of the Company and its Related
Corporations and to carry out the intent that the Plan be treated as an Employee
Stock Purchase Plan.

     

    (c)           The
Board may delegate administration of the Plan to a Committee of the Board
composed of two (2) or more members of the Board.  If administration
is delegated to a Committee, the Committee shall have, in connection with the
administration of the Plan, the powers theretofore possessed by the Board,
subject, however, to such resolutions, not inconsistent with the provisions of
the Plan, as may be adopted from time to time by the Board.  The Board
may abolish the Committee at any time and revest in the Board the administration
of the Plan.  If administration is delegated to a Committee,
references to the Board in this Plan and in the Offering document shall
thereafter be deemed to be to the Board or the Committee, as the case may
be.

     

    
      	
              4.

            	
              Shares
      of Common Stock Subject to the
Plan.

            

    

     

    Subject
to the provisions of Section 14 relating to adjustments upon changes in
securities, the shares of Common Stock that may be sold pursuant to Purchase
Rights shall not exceed in the aggregate one million five hundred thousand
(1,500,000) shares of Common Stock.  If any Purchase Right granted
under the Plan shall for any reason terminate without having been exercised, the
shares of Common Stock not purchased under such Purchase Right shall again
become available for issuance under the Plan.

     

    
      	
              5.

            	
              Grant
      of Purchase Rights; Offering.

            

    

     

    (a)           The
Board may from time to time grant or provide for the grant of Purchase Rights to
purchase shares of Common Stock under the Plan to Eligible Employees in an
Offering (consisting of one or more Purchase Periods) on an Offering Date or
Offering Dates selected by the Board.  Each Offering shall be in such
form and shall contain such terms and conditions as the Board shall deem
appropriate, which shall comply with the requirement of Section 423(b)(5) of the
Code that all Employees granted Purchase Rights shall have the same rights and
privileges.  The terms and conditions of an Offering shall be
incorporated by reference into the Plan and treated as part of the
Plan.  The provisions of separate Offerings need not be identical, but
each Offering shall include (through incorporation of the provisions of this
Plan by reference in the document comprising the Offering or otherwise) the
period during which the Offering shall be effective, which period shall not
exceed twenty-seven (27) months beginning with the Offering Date, and the
substance of the provisions contained in Sections 6 through 9,
inclusive.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)           If
a Participant has more than one Purchase Right outstanding under the Plan,
unless he or she otherwise indicates in agreements or notices delivered
hereunder:  (i) each agreement or notice delivered by that
Participant shall be deemed to apply to all of his or her Purchase Rights under
the Plan, and (ii) a Purchase Right with a lower exercise price (or an
earlier-granted Purchase Right, if different Purchase Rights have identical
exercise prices) shall be exercised to the fullest possible extent before a
Purchase Right with a higher exercise price (or a later-granted Purchase Right
if different Purchase Rights have identical exercise prices) shall be
exercised.

     

    
      	
              6.

            	
              Eligibility.

            

    

     

    (a)           Purchase
Rights may be granted only to Employees of the Company or, as the Board may
designate as provided in Section 3(b), to Employees of a Related
Corporation.  Except as provided in Section 6(b), an Employee shall
not be eligible to be granted Purchase Rights under the Plan unless, on the
Offering Date, such Employee has been in the employ of the Company or the
Related Corporation, as the case may be, for such continuous period preceding
such Offering Date as the Board may require, but in no event shall the required
period of continuous employment be greater than two (2) years.  In
addition, the Board may provide that no Employee shall be eligible to be granted
Purchase Rights under the Plan unless, on the Offering Date, such Employee’s
customary employment with the Company or the Related Corporation is more than
twenty (20) hours per week and more than five (5) months per calendar
year.

     

    (b)           The
Board may provide that each person who, during the course of an Offering, first
becomes an Eligible Employee shall, on a date or dates specified in the Offering
which coincides with the day on which such person becomes an Eligible Employee
or which occurs thereafter, receive a Purchase Right under that Offering, which
Purchase Right shall thereafter be deemed to be a part of that
Offering.  Such Purchase Right shall have the same characteristics as
any Purchase Rights originally granted under that Offering, as described herein,
except that:

     

    (i)           the
date on which such Purchase Right is granted shall be the “Offering Date” of
such Purchase Right for all purposes, including determination of the exercise
price of such Purchase Right;

     

    (ii)           the
period of the Offering with respect to such Purchase Right shall begin on its
Offering Date and end coincident with the end of such Offering; and

     

    (iii)           the
Board may provide that if such person first becomes an Eligible Employee within
a specified period of time before the end of the Offering, he or she shall not
receive any Purchase Right under that Offering.

     

    (c)           No
Employee shall be eligible for the grant of any Purchase Rights under the Plan
if, immediately after any such Purchase Rights are granted, such Employee owns
stock possessing five percent (5%) or more of the total combined voting power or
value of all classes of stock of the Company or of any Related
Corporation.  For purposes of this Section 6(c), the rules of Section
424(d) of the Code shall apply in determining the stock ownership of any
Employee, and stock which such Employee may purchase under all outstanding
Purchase Rights and options shall be treated as stock owned by such
Employee.

     

    (d)           As
specified by Section 423(b)(8) of the Code, an Eligible Employee may be granted
Purchase Rights under the Plan only if such Purchase Rights, together with any
other rights granted under all Employee Stock Purchase Plans of the Company and
any Related Corporations, do not permit such Eligible Employee’s rights to
purchase stock of the Company or any Related Corporation to accrue at a rate
which exceeds twenty five thousand dollars ($25,000) of Fair Market Value of
such stock (determined at the time such rights are granted, and which, with
respect to the Plan, shall be determined as of their respective Offering Dates)
for each calendar year in which such rights are outstanding at any
time.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (e)           Officers
of the Company and any designated Related Corporation, if they are otherwise
Eligible Employees, shall be eligible to participate in Offerings under the
Plan.  Notwithstanding the foregoing, the Board may provide in an
Offering that Employees who are highly compensated Employees within the meaning
of Section 423(b)(4)(D) of the Code shall not be eligible to
participate.

     

    
      	
              7.

            	
              Purchase
      Rights; Purchase Price.

            

    

     

    (a)           On
each Offering Date, each Eligible Employee, pursuant to an Offering made under
the Plan, shall be granted a Purchase Right to purchase up to that number of
shares of Common Stock purchasable either with a percentage or with a maximum
dollar amount, as designated by the Board, but in either case not exceeding
fifteen percent (15%), of such Employee’s Earnings (as defined by the Board in
each Offering) during the period that begins on the Offering Date (or such later
date as the Board determines for a particular Offering) and ends on the date
stated in the Offering, which date shall be no later than the end of the
Offering.

     

    (b)           The
Board shall establish one (1) or more Purchase Dates during an Offering as of
which Purchase Rights granted pursuant to that Offering shall be exercised and
purchases of shares of Common Stock shall be carried out in accordance with such
Offering.

     

    (c)           In
connection with each Offering made under the Plan, the Board may specify a
maximum number of shares of Common Stock that may be purchased by any
Participant on any Purchase Date during such Offering.  In connection
with each Offering made under the Plan, the Board may specify a maximum
aggregate number of shares of Common Stock that may be purchased by all
Participants pursuant to such Offering.  In addition, in connection
with each Offering that contains more than one Purchase Date, the Board may
specify a maximum aggregate number of shares of Common Stock that may be
purchased by all Participants on any given Purchase Date under the
Offering.  If the aggregate purchase of shares of Common Stock
issuable upon exercise of Purchase Rights granted under the Offering would
exceed any such maximum aggregate number, then, in the absence of any Board
action otherwise, a pro rata allocation of the shares of Common Stock available
shall be made in as nearly a uniform manner as shall be practicable and
equitable.

     

    (d)           
The purchase price of shares of Common Stock acquired pursuant to Purchase
Rights shall be not less than the lesser of:

     

    (i)           an
amount equal to eighty-five percent (85%) of the Fair Market Value of the shares
of Common Stock on the Offering Date; or

     

    (ii)           an
amount equal to eighty-five percent (85%) of the Fair Market Value of the shares
of Common Stock on the applicable Purchase Date.

     

    
      	
              8.

            	
              Participation;
      Withdrawal; Termination.

            

    

     

    (a)           A
Participant may elect to authorize payroll deductions pursuant to an Offering
under the Plan by completing and delivering to the Company, within the time
specified in the Offering, an enrollment form (in such form as the Company may
provide). Each such enrollment form shall authorize an amount of Contributions
expressed as a percentage of the submitting Participant’s Earnings (as defined
in each Offering) during the Offering (not to exceed the maximum percentage
specified by the Board). Each Participant’s Contributions shall be credited to a
bookkeeping account for such Participant under the Plan and shall be deposited
with the general funds of the Company except where applicable law requires that
Contributions be deposited with a third party. To the extent provided in the
Offering, a Participant may begin such Contributions after the beginning of the
Offering.  To the extent provided in the Offering, a Participant may
thereafter reduce (including to zero) or increase his or her
Contributions.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)           During
an Offering, a Participant may cease making Contributions and withdraw from the
Offering by delivering to the Company a notice of withdrawal in such form as the
Company may provide.  Such withdrawal may be elected at any time prior
to the end of the Offering, except as provided otherwise in the
Offering.  Upon such withdrawal from the Offering by a Participant,
the Company shall distribute to such Participant all of his or her accumulated
Contributions (reduced to the extent, if any, such deductions have been used to
acquire shares of Common Stock for the Participant) under the Offering, and such
Participant’s Purchase Right in that Offering shall thereupon
terminate.  A Participant’s withdrawal from an Offering shall have no
effect upon such Participant’s eligibility to participate in any other Offerings
under the Plan, but such Participant shall be required to deliver a new
enrollment form in order to participate in subsequent Offerings.

     

    (c)           Purchase
Rights granted pursuant to any Offering under the Plan shall terminate
immediately upon a Participant ceasing to be an Employee for any reason or for
no reason (subject to any post-employment participation period required by law)
or other lack of eligibility. The Company shall distribute to such terminated or
otherwise ineligible Employee all of his or her accumulated Contributions
(reduced to the extent, if any, such deductions have been used to acquire shares
of Common Stock for the terminated or otherwise ineligible Employee) under the
Offering.

     

    (d)           Purchase
Rights shall not be transferable by a Participant otherwise than by will or the
laws of descent and distribution, or by a beneficiary designation as provided in
Section 13 and, during a Participant’s lifetime, shall be exercisable only by
such Participant.

     

    (e)           Unless
otherwise specified in an Offering, the Company shall have no obligation to pay
interest on Contributions.

     

    
      	
              9.

            	
              Exercise.

            

    

     

    (a)           On
each Purchase Date during an Offering, each Participant’s accumulated
Contributions shall be applied to the purchase of shares of Common Stock up to
the maximum number of shares of Common Stock permitted pursuant to the terms of
the Plan and the applicable Offering, at the purchase price specified in the
Offering.  No fractional shares shall be issued upon the exercise of
Purchase Rights unless specifically provided for in the Offering.

     

    (b)           If
any amount of accumulated Contributions remains in a Participant’s account after
the purchase of shares of Common Stock and such remaining amount is less than
the amount required to purchase one share of Common Stock on the final Purchase
Date of an Offering, then such remaining amount shall be held in such
Participant’s account for the purchase of shares of Common Stock under the next
Offering under the Plan, unless such Participant withdraws from such next
Offering, as provided in Section 8(b), or is not eligible to participate in such
Offering, as provided in Section 6, in which case such amount shall be
distributed to such Participant after the final Purchase Date, without
interest.  If the amount of Contributions remaining in a Participant’s
account after the purchase of shares of Common Stock is at least equal to the
amount required to purchase one (1) whole share of Common Stock on the final
Purchase Date of the Offering, then such remaining amount shall be distributed
in full to such Participant at the end of the Offering.

     

    (c)           No
Purchase Rights may be exercised to any extent unless the shares of Common Stock
to be issued upon such exercise under the Plan are covered by an effective
registration statement pursuant to the Securities Act and the Plan is in
material compliance with all applicable federal, state, foreign and other
securities and other laws applicable to the Plan.  If on a Purchase
Date during any Offering hereunder the shares of Common Stock are not so
registered or the Plan is not in such compliance, no Purchase Rights or any
Offering shall be exercised on such Purchase Date, and the Purchase Date shall
be delayed until the shares of Common Stock are subject to such an effective
registration statement and the Plan is in such compliance, except that the
Purchase Date shall not be delayed more than twelve (12) months and the Purchase
Date shall in no event be more than twenty-seven (27) months from the Offering
Date.  If, on the Purchase Date under any Offering hereunder, as
delayed to the maximum extent permissible, the shares of Common Stock are not
registered and the Plan is not in such compliance, no Purchase Rights or any
Offering shall be exercised and all Contributions accumulated during the
Offering (reduced to the extent, if any, such deductions have been used to
acquire shares of Common Stock) shall be distributed to the
Participants.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
              10.

            	
              Covenants
      of the Company.

            

    

     

    The
Company shall seek to obtain from each federal, state, foreign or other
regulatory commission or agency having jurisdiction over the Plan such authority
as may be required to issue and sell shares of Common Stock upon exercise of the
Purchase Rights.  If, after commercially reasonable efforts, the
Company is unable to obtain from any such regulatory commission or agency the
authority that counsel for the Company deems necessary for the lawful issuance
and sale of shares of Common Stock under the Plan, the Company shall be relieved
from any liability for failure to issue and sell shares of Common Stock upon
exercise of such Purchase Rights unless and until such authority is
obtained.

     

    
      	
              11.

            	
              Use
      of Proceeds from Shares of Common
Stock.

            

    

     

    Proceeds from the sale of shares of
Common Stock pursuant to Purchase Rights shall constitute general funds of the
Company.

     

    
      	
              12.

            	
              Rights
      as a stockholder.

            

    

     

    A Participant shall not be deemed to be
the holder of, or to have any of the rights of a holder with respect to, shares
of Common Stock subject to Purchase Rights unless and until the Participant’s
shares of Common Stock acquired upon exercise of Purchase Rights are recorded in
the books of the Company (or its transfer agent).

     

    
      	
              13.

            	
              Designation
      of Beneficiary.

            

    

     

    (a)           A
Participant may file a written designation of a beneficiary who is to receive
any shares of Common Stock and/or cash, if any, from the Participant’s account
under the Plan in the event of such Participant’s death subsequent to the end of
an Offering but prior to delivery to the Participant of such shares of Common
Stock or cash.  In addition, a Participant may file a written
designation of a beneficiary who is to receive any cash from the Participant’s
account under the Plan in the event of such Participant’s death during an
Offering.

     

    (b)           The
Participant may change such designation of beneficiary at any time by written
notice to the Company.  In the event of the death of a Participant and
in the absence of a beneficiary validly designated under the Plan who is living
at the time of such Participant’s death, the Company shall deliver such shares
of Common Stock and/or cash to the executor or administrator of the estate of
the Participant, or if no such executor or administrator has been appointed (to
the knowledge of the Company), the Company, in its sole discretion, may deliver
such shares of Common Stock and/or cash to the spouse or to any one or more
dependents or relatives of the Participant, or if no spouse, dependent or
relative is known to the Company, then to such other person as the Company may
designate.

     

    
      	
              14.

            	
              Adjustments
      upon Changes in Securities; Corporate
  Transactions.

            

    

     

    (a)           If
any change is made in the shares of Common Stock, subject to the Plan, or
subject to any Purchase Right, without the receipt of consideration by the
Company (through merger, consolidation, reorganization, recapitalization,
reincorporation, stock dividend, dividend in property other than cash, stock
split, liquidating dividend, combination of shares, exchange of shares, change
in corporate structure or other transaction not involving the receipt of
consideration by the Company), the Plan shall be appropriately adjusted in the
type(s), class(es) and maximum number of shares of Common Stock subject to the
Plan pursuant to Section 4(a), and the outstanding Purchase Rights shall be
appropriately adjusted in the type(s), class(es), number of shares and purchase
limits of such outstanding Purchase Rights.  The Board shall make such
adjustments, and its determination shall be final, binding and
conclusive.  (The conversion of any convertible securities of the
Company shall not be treated as a “transaction not involving the receipt of
consideration by the Company.”)

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)           In
the event of a Corporate Transaction, then: (i) any surviving or acquiring
corporation may continue or assume Purchase Rights outstanding under the Plan or
may substitute similar rights (including a right to acquire the same
consideration paid to stockholders in the Corporate Transaction) for those
outstanding under the Plan, or (ii) if any surviving or acquiring corporation
does not continue or assume such Purchase Rights or does not substitute similar
rights for Purchase Rights outstanding under the Plan, then, the Participants’ accumulated
Contributions shall be used to purchase shares of Common Stock within ten (10)
business days prior to the Corporate Transaction under the ongoing Offering, and
the Participants’ Purchase Rights under the ongoing Offering shall terminate
immediately after such purchase.

     

    
      	
              15.

            	
              Amendment
      of the Plan.

            

    

     

    (a)           The
Board at any time, and from time to time, may amend the
Plan.  However, except as provided in Section 14 relating to
adjustments upon changes in securities and except as to amendments solely to
benefit the administration of the Plan, to take account of a change in
legislation or to obtain or maintain favorable tax, exchange control or
regulatory treatment for Participants or the Company or any Related Corporation,
no amendment shall be effective unless approved by the stockholders of the
Company to the extent stockholder approval is necessary for the Plan to satisfy
the requirements of Section 423 of the Code or other applicable laws or
regulations.

     

    (b)           It
is expressly contemplated that the Board may amend the Plan in any respect the
Board deems necessary or advisable to provide Employees with the maximum
benefits provided or to be provided under the provisions of the Code and the
regulations promulgated thereunder relating to Employee Stock Purchase Plans
and/or to bring the Plan and/or Purchase Rights into compliance
therewith.

     

    (c)           The
rights and obligations under any Purchase Rights granted before amendment of the
Plan shall not be impaired by any amendment of the Plan except: (i) with the
consent of the person to whom such Purchase Rights were granted, or (ii) as
necessary to comply with any laws or governmental regulations (including,
without limitation, the provisions of the Code and the regulations promulgated
thereunder relating to Employee Stock Purchase Plans).

     

    
      	
              16.

            	
              Termination
      or Suspension of the Plan.

            

    

     

    (a)           The
Board in its discretion may suspend or terminate the Plan at any
time.  Unless sooner terminated, the Plan shall terminate at the time
that all of the shares of Common Stock reserved for issuance under the Plan, as
increased and/or adjusted from time to time, have been issued under the terms of
the Plan.  No Purchase Rights may be granted under the Plan while the
Plan is suspended or after it is terminated.

     

    (b)           Any
benefits, privileges, entitlements and obligations under any Purchase Rights
while the Plan is in effect shall not be impaired by suspension or termination
of the Plan except (i) as expressly provided in the Plan or with the consent of
the person to whom such Purchase Rights were granted, (ii) as necessary to
comply with any laws,  regulations, or listing requirements, or (iii)
as necessary to ensure that the Plan and/or Purchase Rights comply with the
requirements of Section 423 of the Code.

     

    
      	
              17.

            	
              Effective
      Date of Plan.

            

    

     

    The Plan shall become effective as
determined by the Board, but no Purchase Rights shall be exercised unless and
until the Plan has been approved by the stockholders of the Company within
twelve (12) months before or after the date the Plan is adopted by the
Board.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
              18.

            	
              Miscellaneous
      Provisions.

            

    

     

    (a)           The Plan and Offering do not constitute
an employment contract.  Nothing in the Plan or in the Offering shall
in any way alter the at will nature of a Participant’s employment
or  be deemed to create in any way whatsoever any obligation on the
part of any Participant to continue in the employ of the Company or a Related
Corporation, or on the part of the Company or a Related Corporation to continue
the employment of a Participant.

     

    (b)           The provisions of the Plan shall be
governed by the laws of the State of California without resort to that state’s
conflicts of laws rules.

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