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        AMENDMENT TO DEBENTURE AND INVESTOR REGISTRATION RIGHTS AGREEMENT

         THIS AMENDMENT TO DEBENTURE AND REGISTRATION RIGHTS AGREEMENT (the
"Amendment") is made and entered into effective as of October 30, 2006, to amend
that certain Investor Registration Rights Agreement (the "Agreement") dated
December 30, 2005 by and among CIRTRAN CORP., a Nevada corporation (the
"Company") and CORNELL CAPITAL PARTNERS, LP (the "Investor"). The Company and
the Investor may each be referred to herein as a "Party" and collectively as the
"Parties."

                                    Recitals:

         WHEREAS, on or about December 30, 2005, the Company and the Investor
entered into a series of financing agreements (the "December Transaction
Documents"), including, without limitation a Securities Purchase Agreement, a
convertible debenture issued pursuant thereto, and an Investor Registration
Rights Agreement, pursuant to which, among other things, the Investor agreed to
advance the Company the aggregate of One Million Five Hundred Thousand Dollars
($1,500,000) in exchange for the issuance by the Company of a secured
convertible debenture; and

         WHEREAS, on or about August 23, 2006, the Parties entered into another
series of financing agreements (the "August Transaction Documents"), including,
without limitation a Securities Purchase Agreement, a convertible debenture (the
"August Debenture") issued pursuant thereto, and an Amended and Restated
Investor Registration Rights Agreement (the "Amended IRRA"), pursuant to which,
among other things, the Investor agreed to advance the Company the aggregate of
One Million Five Hundred Thousand Dollars ($1,500,000) in exchange for the
issuance by the Company of a secured convertible debenture

         WHEREAS, the parties hereto desire to amend the August Debenture and
the Amended IRRA to extend certain deadlines contained therein; and

         WHEREAS, all terms in the August Debenture and the Amended IRRA, except
as modified herein, and the terms contained in the December Transaction
Documents and the August Transaction Documents, shall remain in full force and
effect.

         NOW, THEREFORE, in consideration of the premises and the mutual
promises, conditions and covenants contained herein and other good and valuable
consideration, receipt of which is hereby acknowledged, the parties hereto agree
as follows:

         1.       Recitals.  The  foregoing  recitals  are  hereby  incorporated
                  herein by reference  and  acknowledged  as true and correct by
                  the parties hereto.

         2.       Amended  IRRA.  Section  2(a) of the  Amended  IRRA is  hereby
                  amended and restated in its entirety to read as follows:

<PAGE>

                           "(a) Subject to the terms and conditions of this
                  Agreement, the Company shall prepare and file with the SEC, no
                  later than December 31, 2006 (the "Scheduled Filing
                  Deadline"), a registration statement on Form S-1 or SB-2 (or,
                  if the Company is then eligible, on Form S-3) under the 1933
                  Act (the "Initial Registration Statement") for the
                  registration for the resale by all Investors who purchased
                  Convertible Debentures pursuant to the Securities Purchase
                  Agreement 206,900,000 shares of Common Stock to be issued upon
                  conversion of the Convertible Debentures issued pursuant to
                  the Securities Purchase Agreement and the Securities Purchase
                  Agreeement dated December 30, 2005, as well as fifteen million
                  (15,000,000) shares of Common Stock to be issued upon
                  converstion of the Warrant dated August 23, 2006, and ten
                  million (10,000,000) shares of Common Stock to be issued upon
                  conversion of the Warrant dated December 30, 2005. The Company
                  shall cause the Initial Registration Statement to remain
                  effective until all of the Registrable Securities have been
                  sold. Prior to the filing of the Registration Statement with
                  the SEC, the Company shall furnish a copy of the Initial
                  Registration Statement to the Investors for their review and
                  comment. The Investors shall furnish comments on the Initial
                  Registration Statement to the Company within twenty-four (24)
                  hours of the receipt thereof from the Company."

         3.       August  Debenture.  The August  Debenture is hereby amended as
                  follows:

                  (A)  Section  1.02(b) is amended  and  restated to read in its
                  entirety as follows:

                  (b)      The  Holder  agrees  that it may  onlyt  convert  any
                           amount of principal  or interest of the  Debenture in
                           accordance  with  the  terms  and  conditions  of the
                           Lock-up  Agreement by and between the parties  hereto
                           dated  July  27,   2006,   until  the   Company   has
                           effectuated an increase in its authorized capital. In
                           the event that the Company has not  effectuated  such
                           increase in its  authorized  capital by December  31,
                           2006,  such  failure  shall  constitute  an  event of
                           default on  parallel  with those set forth in Section
                           3.01 below and  subject to the same  consequences  as
                           those listed in Section 3.01 below.

                  (B)  Section  2.01  is  amended  and  restated  to read in its
                  entirety as follows:

                           Section 2.01 Amendments and Waiver of Default. The
                           Debenture may only be amended upon the written
                           consent of both the Company and the Holder.
                           Notwithstanding the above, without the consent of the
                           Holder, the Debenture may be amended to cure any
                           ambiguity, defect or inconsistency, or to provide for
                           assumption of the Company obligations to the Holder.

<PAGE>

                  (C) Paragraph 4.03 is amended and restated to read in its
entirety as follows:

                           Section 4.03 Termination of Conversion Rights. The
                           Holder's right to convert the Debenture into the
                           Common Stock in accordance with Section 4.01 hereof
                           shall terminate on April 23, 2009, and this Debenture
                           shall be automatically converted on that date in
                           accordance with the formula set forth in Section 4.01
                           hereof, and the appropriate shares of Common Stock
                           and amount of interest shall be issued to the Holder.

                  (D) Schedule 1.01 is amended and restated to read in its
entirety as follows:

                                  SCHEDULE 1.01
                                  -------------

                               REPAYMENT SCHEDULE

         March 23, 2007           $200,000
         June 23, 2007            $200,000
         September 23, 2007       $200,000
         December 23, 2007        $200,000
         March 23, 2008           $200,000
         June 23, 2008            $200,000
         September 23, 2008       $200,000
         April 23, 2009           $100,000 plus any accrued and unpaid interest.

                     [SIGNATURE PAGES TO IMMEDIATELY FOLLOW]

<PAGE>

         IN WITNESS WHEREOF, the parties have signed and delivered this
Amendment Agreement on the date first set forth above.

CIRTRAN CORP.                                  CORNELL CAPITAL PARTNERS, LP

By:      /s/ Iehab J. Hawatmeh                 By: Yorkville Advisors, LLC
   -------------------------------------
Name:    Iehab J. Hawatmeh                     Its: General Partner
Title:   President & CEO
                                               By:      /s/ Mark A. Angelo
                                               Name:    Mark A. Angelo
                                               Title:   Portfolio Manager

--------------------------------------------------------------------------------Exhibit 4.1

MERCURY INTERACTIVE
CORPORATION

AMENDED AND RESTATED 2000
SUPPLEMENTAL STOCK OPTION PLAN

(As amended through October
4, 2006)

1.             Purposes of the Plan.  The
purposes of this Stock Option Plan are to attract and retain the best available
personnel for positions of substantial responsibility, to provide additional
incentive to such individuals of the Company and to promote the success of the
Company’s business.  Options granted
hereunder may only be Nonstatutory Stock Options. Stock Purchase Rights may
also be granted under the Plan.

2.             Definitions.  As used herein, the following
definitions shall apply:

(a)           “Administrator”  means the Committee, if one has been
appointed, or the Board of Directors of the Company, if no Committee is
appointed.

(b)           “Board” means the Board of Directors
of the Company.  A member of the Board
shall be referred to hereinafter as a “Director.”

(c)           “Code” means the United States
Internal Revenue Code of 1986, as amended.

(d)           “Committee”  means the Committee appointed by the Board of
Directors in accordance with paragraph (a) of Section 4 of the Plan, if one is
appointed.

(e)           “Common Stock” means the Common Stock
of the Company.

(f)            “Company” means Mercury Interactive
Corporation, a Delaware corporation.

(g)           “Continuous
Status as an Employee “ means that the employment or consulting
relationship is not interrupted or terminated by the Company, any Parent or
Subsidiary.  Continuous Status as an
Employee shall not be considered interrupted in the case of:  (i) any leave of absence approved by the
Administrator, including sick leave, military leave, or any other personal
leave; or (ii) transfers between locations of the Company or between the
Company, its Parent, its Subsidiaries or its successor; or (iii) a change in
status from an employee to a consultant if specifically approved by the
Administrator or its designee.

(h)           “Director”
means a member of the Board of Directors of the Company or of the board of
directors of any Parent of the Company.

(i)            “Employee” means any person, excluding
Officers and Directors, who is not a United States citizen, employed by the
Company or any Parent or Subsidiary of the Company.  Neither service as a Director nor the payment
of a director’s fee by the Company shall be sufficient to constitute “employment”
by the Company.

(j)            “Exchange Act” means the United States
Securities Exchange Act of 1934, as amended.

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(k)           “Incentive Stock Option” means any
Option intended to qualify as an incentive stock option within the meaning of
Section 422 of the Code.

(l)            “Nonstatutory Stock Option” means an
Option not intended to qualify as an Incentive Stock Option.

(m)          “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.

(n)                                 “Option” means a stock option granted
pursuant to the Plan.

(o)           “Option
Agreement” means a written or electronic agreement between the Company and
an Optionee evidencing the terms and conditions of an individual Option
grant.  The Option Agreement is subject
to the terms and conditions of the Plan.

(p)           “Optioned
Stock” means the Common Stock subject to an Option or Stock Purchase Right.

(q)           “Optionee”
means the holder of an outstanding Option or Stock Purchase Right granted under
the Plan.

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

(s)           “Plan”
means this Amended and Restated 2000 Supplemental Stock Option Plan.

(t)            “Restricted
Stock” means shares of Common Stock acquired pursuant to a grant of a Stock
Purchase Right.

(u)           “Restricted
Stock Purchase Agreement” means a written or electronic agreement between
the Company and an Optionee evidencing the terms and conditions of an
individual Stock Purchase Right grant. 
The Restricted Stock Purchase Agreement is subject to the terms and
conditions of the Plan

(v)           “Share”
means a share of the Common Stock, as adjusted in accordance with Section 12 of
the Plan.

(w)          “Stock
Purchase Right” means a right to purchase Common Stock pursuant to this
Plan.

(x)            “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. 
Subject to the provisions to Section 12 of the Plan, the total number of
Shares reserved and available for issuance is 6,000,000.

Subject to Section 12 of the
Plan, if an Option or Stock Purchase Right expires or becomes unexercisable
without having been exercised in full, the unpurchased Shares which were
subject thereto shall become available for future grant or sale under the Plan
(unless the Plan has terminated). 
However, Shares that have actually been issued under the Plan, upon
exercise of either an Option or

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Stock Purchase Right, shall not be returned to the
Plan and shall not become available for future distribution under the Plan,
except that if Shares of Restricted Stock are repurchased by the Company at
their original purchase price, such Shares shall become available for future
grant under the Plan.

4.             Administration of the Plan.

(a)           Procedure.  The
Plan shall be administered by (A) the Board or (B) a committee designated by
the Board, which committee shall be constituted in such a manner as to satisfy
the legal requirements relating to the administration of stock option plans, if
any, of state or foreign corporate law, the relevant stock exchange and the
Code or any applicable local law (the “Applicable Rules”).  Once appointed, such Committee shall serve in
its designated capacity until otherwise directed by the Board.  The Board may increase the size of the
Committee and appoint additional members, remove members (with or without
cause) and substitute new members, fill vacancies (however caused), and remove
all members of the Committee and thereafter directly administer the Plan, all
to the extent permitted by the Applicable Rules.

(b)           Powers
of the Administrator.  Subject to the provisions of the Plan, and in
the case of a Committee, subject to the specific duties delegated by the Board
to such Committee, the Administrator shall have the authority, in its
discretion:

(i)            to determine the Fair Market Value of the
Common Stock, in accordance with Section 8(b) of the Plan;

(ii)           to select the Employees to whom Options and
Stock Purchase Rights may be granted hereunder;

(iii)          to determine whether and to what extent
Options and Stock Purchase Rights are granted hereunder;

(iv)          to determine the number of shares of Common
Stock to be covered by each Option or Stock Purchase Right granted hereunder;

(v)           to approve forms of agreement for use under
the Plan;

(vi)          to determine the terms and conditions as
permitted under local laws, not inconsistent with the terms of the Plan, of any
award granted hereunder.  Such terms and
conditions include, but are not limited to, the exercise price, the time or
times when Options or Stock Purchase Rights may be exercised (which may be
based on performance criteria), any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or limitation regarding any Option
or Stock Purchase Right or the shares of Common Stock relating thereto, based
in each case on such factors as the Administrator, in its sole discretion,
shall determine;

(vii)         to construe and interpret the terms of the
Plan and awards granted pursuant to the Plan;

(viii)        to prescribe, amend and rescind rules and
regulations relating to the Plan;

(ix)           to modify or amend each Option or Stock
Purchase Right (subject to Section 15(b) of the Plan);

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(x)            to authorize any person to execute on behalf
of the Company any instrument required to effect the grant of an Option or
Stock Purchase Right previously granted by the Administrator;

(xi)           to determine and recommend the terms of any
Option exchange program or repricing program for Option or Stock Purchase
Rights granted under the Plan, and subject to stockholder approval only to the
extent required in Section 15(a), to institute and implement any such program;

(xii)          to determine the terms and restrictions applicable to Options and Stock
Purchase Rights;

(xiii)         to prescribe, amend and rescind rules and regulations relating to the
Plan, including rules and regulations relating to sub-plans established for the
purpose of qualifying for preferred tax treatment under foreign tax laws; and

(xiv)        to make all other determinations deemed necessary or advisable for
administering the Plan.

(c)           Effect
of Administrator’s Decision.  The Administrator’s decisions, determinations
and interpretations shall be final and binding on all Optionees and any other
holders of Options and Stock Purchase Rights.

5.             Eligibility.

(a)           Nonstatutory Stock Options
and Stock Purchase Rights may be granted only to Employees who are not Officers
or Directors of the Company.  For
purposes of the foregoing sentence, “Employees” shall include prospective
Employees to whom Options or Stock Purchase Rights are granted in connection
with written offers of employment with the Company or any Parent or Subsidiary
of the Company.

(b)           Each
Option shall be designated in the Option Agreement as a Nonstatutory Stock
Option.

(c)           Nothing in the Plan or any Option or Stock
Purchase Right granted hereunder shall confer upon any Optionee any right with
respect to continuation of employment or consulting relationship with the
Company, nor shall it interfere in any way with the Optionee’s right or the
Company’s right to terminate his employment or consulting relationship at any
time, with or without cause.

(d)           The following limitations shall apply to
grants of Option or Stock Purchase Rights to Employees:

(i)            No
Employee shall be granted, in any fiscal year of the Company, Options or Stock
Purchase Rights to purchase more than 1,000,000 Shares.

(ii)           In
connection with his or her initial employment, an Employee may be granted
Options or Stock Purchase Rights to purchase up to an additional 2,000,000
Shares which shall not count against the limit set forth in subsection (i)
above.

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(iii)          The
foregoing limitations shall be adjusted proportionately in connection with any
change in the Company’s capitalization as described in Section 12.

(iv)          If an Option or
Stock Purchase Right is cancelled in the same fiscal year of the Company in
which it was granted (other than in connection with a transaction described in
Section 12), the cancelled Option or Stock Purchase Right shall be counted
against the limit set forth in subsection (i) above. For this purpose, if the
exercise price of an Option or Stock Purchase Right is reduced, such reduction
will be treated as a cancellation of the Option or Stock Purchase Right and the
grant of a new Option or Stock Purchase Right.

6.             Term of Plan.  The
term of the Plan shall be ten (10) years and six months, commencing on July 25,
2000 and terminating on January 25, 2011 unless sooner terminated under Section
15 of the Plan.

7.             Term of Option. The term of each Option shall be stated in
the Option Agreement; provided, however, that the term of each Option granted
to an Employee residing in any country other than Switzerland or the
Netherlands shall be no more than ten (10) years from the date of grant. The
term of each Option granted to an Employee residing in Switzerland shall be no
more than ten (10) years and six months from the date of grant. The term of
each Option granted to an Employee residing in the Netherlands shall be no more
than six (6) years from the date of grant.

8.             Option Exercise Price and Consideration.

(a)           The per Share exercise price
under each Option shall be such price as is determined by the Administrator;
provided, however, the per Share exercise price shall be no less than 100% of
the Fair Market Value per Share on the date of grant.

For
purposes of this Section 8(a), in the event that an Option is amended to reduce
the exercise price, the date of grant of such Option shall thereafter be
considered to be the date of such amendment.

(b)           The Fair Market Value shall
be determined by the Administrator in good faith; provided, however, that where
there is a public market for the Common Stock, the Fair Market Value per Share
shall be the closing price per share of the Common Stock, as reported in the
Wall Street Journal (or, if not so reported, as otherwise reported by the
exchange or system on which the Common Stock is listed), for the date of
determination or, in the event such date of determination is not a trading day,
on the first trading day following the date of determination.

(c)           The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment.  The acceptable form of
consideration shall be determined, as permitted under local laws, by the
Administrator at the time of grant.  Such
consideration may consist entirely of:

(i)            cash;

(ii)           check;

(iii)          other Shares which (A) in the case of Shares
acquired upon exercise of an option, have been owned by the Optionee for more
than six months on the date of surrender, and (B)

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have a Fair Market Value on the date of surrender
equal to the aggregate exercise price of the Shares as to which said Option
shall be exercised;

(iv)          delivery of a properly executed exercise
notice together with such other documentation as the Administrator and the
broker, if applicable, shall require to effect an exercise of the Option and
delivery to the Company of the sale proceeds required to pay the exercise price
and any tax withholding resulting from such exercise;

(v)           any combination of the foregoing methods of
payment; or

(vi)          such other consideration and method of
payment for the issuance of Shares to the extent permitted by applicable laws.

(d)           Prior to issuance of the Shares upon exercise
of an Option, the Optionee shall pay or make adequate provision for any
foreign, federal, or state withholding obligations of the Company, if
applicable.

9.             Exercise of Option.

(a)           Procedure for Exercise; Rights as a
Stockholder. Any Option
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Administrator at the time of grant, including performance
criteria with respect to the Company and/or the Optionee, and as shall be
permissible under the terms of the Plan.

An Option may not be exercised for a fraction of a Share.

An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been received by the
Company.  Such exercise shall be in
accordance with the policies and procedures adopted by the Administrator from
time to time.  Full payment may, as
authorized by the Administrator, consist of any consideration and method of
payment allowable under Section 8(c) of the Plan.  Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the stock certificate evidencing such Shares, no right
to vote or receive dividends or any other rights as a stockholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the
Option.  The Company shall issue (or
cause to be issued) such stock certificate as promptly as practicable upon
valid exercise of the Option.  No
adjustment will be made for a dividend or other right for which the record date
is prior to the date the stock certificate is issued, except as provided in
Section 12 of the Plan.

Exercise of an Option in any manner shall result in a decrease in the
number of Shares which thereafter may be available, both for purposes of the
Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.

(b)           Termination
of Status as an Employee. In
the event of termination of an Optionee’s Continuous Status as an Employee,
such Optionee may, only within 30 days after the date of such termination (or
such other period as is set out by the Administrator in the Option Agreement,
but in no event later than the expiration date of the term of such Option as
set forth in the Option Agreement), exercise the Option to the extent that
Optionee was vested and not subject to a

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Company repurchase option at the date of such
termination.  To the extent that Optionee
was not vested or was subject to a Company repurchase option at the date of
such termination, or if Optionee does not exercise such Option to the extent so
entitled within the time specified herein, the Option shall terminate.

(c)           Disability
of Optionee. Notwithstanding
the provisions of Section 9(b) above, in the event of termination of an
Optionee’s Continuous Status as an Employee as a result of his total and
permanent disability (as defined in Section 22(e)(3) of the Code), he may
exercise his Option to the extent he was vested or was not subject to a Company
repurchase option within six (6) months from the date of such termination (or
such other period as is specified in the grant, but in no event later than the
date of expiration of the term of such Option as set forth in the Option
Agreement).  To the extent that the
Optionee was not vested or was subject to a Company repurchase option at the
date of such termination, or does not exercise such Option (to the extent
exercisable) within the time specified herein, the Option shall terminate.

(d)           Death of Optionee. 
Notwithstanding the provisions of Section 9(b) above, in the event of
the death of an Optionee:

(i)            during the term of the Option, who is at the
time of his death an Employee and who shall have been in Continuous Status as
an Employee since the date of grant of the Option, the Option may be exercised,
at any time within six (6) months following the date of death (or such other
period as is specified in the grant, but in no event later than the date of
expiration of the term of such Option as set forth in the Option Agreement), by
the Optionee’s estate or by a person who acquired the right to exercise the
Option by bequest or inheritance,  as to
all of the Optioned Stock, including Shares as to which it would not otherwise
be exercisable, and such Shares shall be fully vested and not subject to any
repurchase option; or

(ii)           during the
post-termination exercise period specified in the grant with respect to
terminations under Section 9(b) above, at any time within six (6) months
following the date of death (or such other period as is determined by the
Administrator, but in no event later than the date of expiration of the term of
such Option as set forth in the Option Agreement), by the Optionee’s estate or
by a person who acquired the right to exercise the Option by bequest or
inheritance, but only to the extent such Option was vested and not subject to a
repurchase option of the Company at the date of termination.

10.           Non-Transferability
of Options and Stock Purchase Rights. Except as otherwise designated by the Administrator, an Option or
Stock Purchase Right may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by applicable
laws of descent or distribution and may be exercised, during the lifetime of
the Optionee, only by the Optionee.

11.           Stock
Purchase Rights.

(a)           Rights to Purchase. 
Stock Purchase Rights may be issued either alone, in addition to, or in
tandem with other awards granted under the Plan and/or cash awards made outside
of the Plan.  After the Administrator
determines that it will offer Stock Purchase Rights under the Plan, it shall
advise the offeree in writing or electronically of the terms, conditions and
restrictions related to the offer, including the number of Shares that such
person shall be entitled to purchase, the price to be paid, the forms of
consideration which may be used to exercise the Stock Purchase Right and the time
within which such person must accept such offer.  The terms of the offer shall comply in all
respects with Section 260.140.42 of Title 10 of the California Code of
Regulations.  The offer shall be accepted
by execution of a Restricted Stock Purchase Agreement in the form determined by
the Administrator.

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(b)           Repurchase Option. 
Unless the Administrator determines otherwise, the Restricted Stock
Purchase Agreement shall grant the Company a repurchase option exercisable upon
the voluntary or involuntary termination of the Optionee’s service with the
Company for any reason (including death or disability).  The purchase price for Shares repurchased
pursuant to the Restricted Stock Purchase Agreement shall be the original price
paid by the Optionee.  In either case,
such purchase price shall be paid by cash or cancellation of any indebtedness
of the Optionee to the Company.

(c)           Other Provisions.  The
Restricted Stock Purchase Agreement shall contain such other terms, provisions
and conditions not inconsistent with the Plan as may be determined by the
Administrator in its sole discretion.

(d)           Rights as a Shareholder.  Once
the Stock Purchase Right is exercised, the Optionee shall have rights
equivalent to those of a shareholder and shall be a shareholder when his or her
purchase is entered upon the records of the duly authorized transfer agent of
the Company.  No adjustment shall be made
for a dividend or other right for which the record date is prior to the date
the Stock Purchase Right is exercised, except as provided in Section 12 of the
Plan.

12.                                 Adjustments Upon Changes in Capitalization,
Dissolution, Merger, Asset Sale or Change of Control.

(a)           Changes in Capitalization. 
Subject to any required action by the stockholders of the Company, the
number of shares of Common Stock covered by each outstanding Option or Stock
Purchase Right, and the number of shares of Common Stock which have been
authorized for issuance under the Plan but as to which no Options or Stock
Purchase Rights have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option or Stock Purchase Right, as well
as the price per share of Common Stock covered by each such outstanding Option
or Stock Purchase Right, shall be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification of
the Common Stock, or any other increase or decrease in the number of issued
shares of Common Stock 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.”  Such adjustment shall be
made by the Administrator, whose determination in that respect shall be final,
binding and conclusive.  Except as
expressly provided herein, no issuance by the Company of shares of stock of any
class, or securities convertible into shares of stock of any class, shall
affect, and no adjustment by reason thereof shall be made with respect to, the
number or price of shares of Common Stock subject to an Option or Stock
Purchase Right.

(b)           Dissolution
or Liquidation.  In the event of the proposed dissolution or
liquidation of the Company, to the extent that an Option or Stock Purchase
Right has not been previously exercised, it will terminate immediately prior to
the consummation of such proposed action. 
The Board may, in the exercise of its sole discretion in such instances,
declare that any Option or Stock Purchase Right shall terminate as of a date
fixed by the Board and give each Optionee the right to exercise his or her
Option or Stock Purchase Right as to all or any part of the Optioned Stock,
including Shares as to which the Option or Stock Purchase Right would not
otherwise be exercisable.

(c)           Merger or Asset Sale.  In
the event of a merger of the Company with or into another corporation or the
sale of substantially all of the assets of the Company:

(i)            Each outstanding Option or Stock Purchase
Right shall be assumed or an equivalent option or stock purchase right
substituted by the successor corporation or a Parent or

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Subsidiary of the successor corporation.  Any Shares subject to a repurchase option of
the Company shall be exchanged for the consideration (whether stock, cash, or
other securities or property) received in the merger or asset sale by the
holders of the Common Stock for the successor corporation or a parent or
subsidiary of such successor corporation for each Share held on the effective
date of the transaction and such consideration shall, in the case of securities
of the successor corporation, be subject to a repurchase option with terms
consistent to the Company’s repurchase option and in the case of any other
property shall be subject to vesting according to the schedule for the lapse of
the repurchase option.

(ii)           In the event that the successor corporation
refuses to assume or substitute for the Option or Stock Purchase Right, the
Optionee shall have the right to exercise the Option or Stock Purchase Right as
to all of the Optioned Stock, including Shares as to which it would not
otherwise be exercisable, and such Shares shall be fully vested and not subject
to any repurchase option.  In the event
that the successor corporation fails to assume the Restricted Stock Purchase
Agreement pursuant to which the Optionee purchased unvested Shares, the Company’s
repurchase option shall lapse and the shares shall be fully vested.  If an Option or Stock Purchase Right is
exercisable in lieu of assumption or substitution in the event of a merger or
sale of assets, the Administrator shall notify the Optionee that the Option or
Stock Purchase Right shall be fully exercisable for a period of fifteen (15) days
from the date of such notice, and the Option or Stock Purchase Right shall
terminate upon the expiration of such period. 
For the purposes of this paragraph, the Option or Stock Purchase Right
shall be considered assumed if, following the merger or sale of assets, the
option or stock purchase right confers the right to purchase or receive, for
each Share of Optioned Stock subject to the Option or Stock Purchase Right
immediately prior to the merger or sale of assets, the consideration (whether
stock, cash, or other securities or property) received in the merger or sale of
assets by holders of Common Stock for each Share held on the effective date of
the transaction (and if holders were offered a choice of consideration, the
type of consideration chosen by the holders of a majority of the outstanding
Shares); provided, however, that if such consideration received in the merger
or sale of assets was not solely Common Stock of the successor corporation or
its Parent, the Administrator may, with the consent of the successor
corporation, provide for the consideration to be received upon the exercise of
the Option or Stock Purchase Right, for each Share of Optioned Stock subject to
the Option or Stock Purchase Right, to be solely common stock of the successor
corporation or its Parent equal in Fair Market Value to the per share
consideration received by holders of Common Stock in the merger or sale of
assets.

13.           Stock Withholding to Satisfy Withholding Tax
Obligations.  At the discretion of the Administrator, Optionees
may satisfy withholding obligations as provided in this paragraph.

(a)           For Options or Stock Purchase Rights granted
to Employees whose remuneration is subject to taxation in the United States.  When
an Optionee incurs tax liability in connection with the exercise of an Option
or Stock Purchase Right, which tax liability is subject to tax withholding
under applicable tax laws, and the Optionee is obligated to pay the Company an
amount required to be withheld under applicable tax laws, the Optionee may satisfy
the withholding tax obligation by electing to have the Company withhold from
the Shares to be issued upon exercise of the Option or Stock Purchase Right
that number of Shares having a Fair Market Value equal to the amount required
to be withheld.  The Fair Market Value of
the Shares to be withheld shall be determined on the date that the amount of
tax to be withheld is determined (the “Tax Date”).

All elections by an Optionee to have Shares withheld for this purpose
shall be made in writing in a form acceptable to the Administrator and shall be
subject to the following restrictions:

(i)  the election must be made on
or prior to the applicable Tax Date;

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(ii)  once made, the election
shall be irrevocable as to the particular Shares of the Option or Stock
Purchase Right as to which the election is made;

(iii)  all elections shall be
subject to the consent of the Administrator;

(iv)  if the Optionee is subject
to Rule 16b-3, the election must comply with the applicable provisions of Rule
16b-3 and shall be subject to such additional conditions or restrictions
as may be required thereunder to qualify for the maximum exemption from Section
16 of the Exchange Act with respect to Plan transactions.

In the event the election to have Shares withheld is made by an
Optionee and the Tax Date is deferred under Section 83 of the Code because no
election is filed under Section 83(b) of the Code, the Optionee shall receive
the full number of Shares with respect to which the Option or Stock Purchase
Right is exercised but such Optionee shall be unconditionally obligated to
tender back to the Company the proper number of Shares on the Tax Date.

(b)
          For Options or
Stock Purchase Rights granted to Employees whose remuneration is subject to
taxation in any country other than the United States. Upon the
disposition by an Optionee or other person of shares of Common Stock acquired
pursuant to the exercise of a Nonqualified Stock Option or a Stock Purchase
Right, the Company shall have the right to require such Optionee or such other
person to pay by cash, or certified or cashier’s check payable to the Company,
the amount of any taxes which the Company may be required to withhold with
respect to such transactions.  The above
notwithstanding, in any case where a tax is required to be withheld in
connection with the issuance or transfer of shares of Common Stock under this
Plan, the Company may reduce the number of such shares issued or transferred by
the appropriate number of shares to accomplish such withholding.

14.           Time of Granting Options or Stock Purchase
Rights.  The date of grant of an Option or Stock
Purchase Right shall, for all purposes, be the date on which the Board or the
Administrator makes the determination granting such Option or Stock Purchase
Right.  Notice of the determination shall
be given to each Employee to whom an Option or Stock Purchase Right is so
granted within a reasonable time after the date of such grant.

15.           Amendment and Termination of the Plan.

(a)           Amendment and Termination.  The
Board may amend or terminate the Plan from time to time in such respects as the
Board may deem advisable; provided that the following changes shall require
approval of the stockholders of the Company in the manner described in Section
19 of the Plan: (i) changes in the designation of the class of persons eligible
to be granted Options or Stock Purchase Rights; and/or (ii)  the reduction of the exercise price of any
Option or Stock Purchase Right to the then current Fair Market Value if the
Fair Market Value of the Common Stock covered by such Option or Stock Purchase
Right shall have declined since the date the Option or Stock Purchase Right was
granted.

 (b)          Effect
of Amendment or Termination.  Any such amendment or termination of the Plan
shall not affect Options or Stock Purchase Rights already granted and such
Options or Stock Purchase Rights shall remain in full force and effect as if
this Plan had not been amended or terminated, unless mutually agreed otherwise
between the Optionee and the Administrator, which agreement must be in writing
and signed by the Optionee and the Company.

16.           Conditions Upon Issuance of Shares. 
Shares shall not be issued pursuant to the exercise of an Option or
Stock Purchase Right unless the exercise of such Option or Stock Purchase Right
and the

 10
 

 

issuance and delivery of such Shares pursuant thereto
shall comply with all relevant provisions of law, including, without
limitation, the United States Securities Act of 1933, as amended, the Exchange
Act, the rules and regulations promulgated thereunder, and the requirements of
any stock exchange upon which the Shares may then be listed, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.

As
a condition to the exercise of an Option or Stock Purchase Right, the Company
may require the person exercising such Option or Stock Purchase Right 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 of the aforementioned relevant provisions of
law.

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

18.           Agreements.  Options or Stock Purchase
Rights shall be evidenced by written or electronic Option Agreements or
Restricted Stock Purchase Agreements, as applicable, in such forms as the
Administrator shall approve.

19.           Stockholder Approval. Any required stockholder approval obtained
at a duly held stockholders’ meeting, may be obtained by the affirmative vote
of the holders of a majority of the outstanding Shares of the Company present
or represented and entitled to vote thereon.

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