Document:

SPECTRUMDNA,
      INC.

     

    2008
      EQUITY INCENTIVE PLAN

     

    1. Purposes
      of the Plan.
      The
      purposes of this Plan are:

     

    (a) to
      attract and retain the best available personnel for positions of substantial
      responsibility

     

    (b) to
      provide additional incentive to Employees, Directors and Consultants
      and

     

    (c) to
      promote the success of the Company’s business.

     

    This
      Plan
      permits the grant of Incentive Stock Options, Nonstatutory Stock Options,
      Restricted Stock, Restricted Stock Units, Stock Appreciation Rights and
      Performance Shares.

     

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

     

    (a) “Administrator”
means
      the Board or any of its Committees as will be administering the Plan in
      accordance with Section 4
      hereof.

     

    (b) “Applicable
      Laws”
means
      the requirements relating to the administration of equity-based awards under
      U.S. state corporate laws, U.S. federal and state securities laws, the Code,
      any
      stock exchange or quotation system on which the Common Stock is listed or quoted
      and the applicable laws of any other country or jurisdiction where Awards are
      granted under the Plan.

     

    (c) “Award”
means,
      individually or collectively, a grant under the Plan of Incentive Stock Options,
      Nonstatutory Stock Options, SARs, Restricted Stock, Restricted Stock Units
      and
      Performance Shares.

     

    (d) “Award
      Agreement”
means
      the written or electronic agreement setting forth the terms and provisions
      applicable to each Award granted under the Plan. The Award Agreement is subject
      to the terms and conditions of the Plan.

     

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

     

    (f) “Cause”
means
      with respect to a Participant, the occurrence of any of the following events:
      (i) such Participant’s commission of a felony or any crime involving fraud,
      dishonesty or moral turpitude under the laws of the United States or any state
      thereof; (ii) such Participant’s attempted commission of, or participation in, a
      fraud or act of dishonesty against the Company; (iii) such Participant’s
      intentional, material violation of any contract or agreement between the
      Participant and the Company or of any statutory duty owed to the Company; (iv)
      such Participant’s unauthorized use or disclosure of the Company’s confidential
      information or trade secrets or (such Participant’s gross negligence or willful
      misconduct. The determination that a termination of the Participant’s continuous
      status as a Service Provider is either for Cause or without Cause shall be
      made
      by the Company in its sole discretion. Any determination by the Company that
      the
      Continuous Service of a Participant was terminated by reason of dismissal
      without Cause for the purposes of outstanding Awards held by such Participant
      shall have no effect upon any determination of the rights or obligations of
      the
      Company or such Participant for any other purpose.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (g) “Change
      in Control”
means
      the occurrence of any of the following events:

     

    (i) Any
      “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act)
      becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act),
      directly or indirectly, of securities of the Company representing fifty percent
      (50%) or more of the total voting power represented by the Company’s then
      outstanding voting securities; or

     

    (ii) The
      consummation of the sale or disposition by the Company of all or substantially
      all of the Company’s assets; or

     

    (iii) The
      consummation of a merger or consolidation of the Company with any other
      corporation, other than a merger or consolidation which would result in the
      voting securities of the Company outstanding immediately prior thereto
      continuing to represent (either by remaining outstanding or by being converted
      into voting securities of the surviving entity or its parent) at least fifty
      percent (50%) of the total voting power represented by the voting securities
      of
      the Company or such surviving entity or its parent outstanding immediately
      after
      such merger or consolidation.

     

    (h) “Code”
means
      the Internal Revenue Code of 1986, as amended. Any
      reference to a section of the Code herein will be a reference to any successor
      or amended section of the Code.

     

    (i) “Committee”
means
      a
      committee of Directors or of other individuals satisfying Applicable Laws
      appointed by the Board in accordance with Section 4
      hereof.

     

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

     

    (k) “Company”
means
      SpectrumDNA, Inc., a Delaware corporation, or any successor
      thereto.

     

    (l) “Consultant”
means
      any person who is engaged by the Company or any Parent or Subsidiary to render
      consulting or advisory services to such entity.

     

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

     

    (n) “Disability”
means
      total and permanent disability as defined in Section 22(e)(3) of the
      Code.

     

    (o) “Effective
      Date”
means
      the effective date of this Plan, which is the earlier of (i) the date that
      this
      Plan is first approved by the Company’s shareholders and (ii) the date this Plan
      is adopted by the Board.

    

    (p) “Employee”
means
      any person, including officers and Directors, employed by the Company or any
      Parent or Subsidiary of the Company. Neither service as a Director nor payment
      of a director’s fee by the Company shall be sufficient to constitute
“employment” by the Company.

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

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

     

    (r) “Exchange
      Program”
means
      a
      program under which (i) outstanding Awards are surrendered or cancelled in
      exchange for Awards of the same type (which may have lower exercise prices
      and
      different terms), Awards of a different type, or cash, or (b) the exercise
      price
      of an outstanding Awards is reduced. The Administrator will determine the terms
      and conditions of any Exchange Program in its sole discretion.

     

    (s) “Fair
      Market Value”
means,
      as of any date, the value of Common Stock determined as follows:

     

    (i) If
      the
      Common Stock is listed on any established stock exchange or a national market
      system, including without limitation the Nasdaq National Market or The Nasdaq
      SmallCap Market of The Nasdaq Stock Market, the Fair Market Value shall be
      the
      average of the closing sales prices of the Common Stock (or the closing bid,
      if
      no sales were reported) on such exchange or system over the thirty (30) trading
      day period ending one (1) trading day prior to the day of determination, as
      reported in The
      Wall Street Journal
      or such
      other source as the Administrator deemed reliable; 

     

    (ii) If
      the
      Common Stock is regularly quoted by a recognized securities dealer but selling
      prices are not reported, the Fair Market Value shall be the average of the
      means
      between the high bid and low asked prices for the Common Stock over the thirty
      (30) trading day period ending one (1) trading day prior to the day of
      determination; or

     

    (iii) For
      purposes of any Awards granted on the Registration Date, the Fair Market Value
      will be the initial price to the public as set forth in the final prospectus
      included within the registration statement on Form S-1, SB-1 or SB-2 filed
      with
      the Securities and Exchange Commission for the initial public offering of the
      Company’s Common Stock; or

     

    (iv) In
      the
      absence of an established market for the Common Stock, the Fair Market Value
      thereof shall be determined in good faith by the Administrator.

     

    (t) “Incentive
      Stock Option”
means
      an Option intended to qualify as an incentive stock option within the meaning
      of
      Section 422 of the Code and the regulations promulgated
      thereunder.

     

    (u) “Inside
      Director”
means
      a
      Director who is an Employee.

     

    (v) “Nonstatutory
      Stock Option”
means
      an Option that by its terms does not qualify or is not intended to qualify
      as an
      Incentive Stock Option.

     

    (w) “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.

     

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

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

    (y) “Outside
      Director”
means
      a
      Director who is not an Employee.

     

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

     

    (aa) “Participant”
means
      the holder of an outstanding Award.

     

    (bb) “Performance
      Share”
means
      an Award denominated in Shares which may be earned in whole or in part upon
      attainment of performance goals or other vesting criteria as the Administrator
      may determine pursuant to Section 9(e).

     

    (cc) “Plan”
means
      this 2008 Equity Incentive Plan.

     

    (dd) “Registration
      Date”
means
      the effective date of the first registration statement that is filed by the
      Company and declared effective pursuant to Section 12(g) of the Exchange Act,
      with respect to any class of the Company’s securities.

     

    (ee) “Restricted
      Stock”
means
      Shares issued pursuant to a Restricted Stock Award under Section 7
      of this
      Plan, or issued pursuant to the early exercise of an Option.

     

    (ff) “Restricted
      Stock Unit”
means
      a
      bookkeeping entry representing an amount equal to the Fair Market Value of
      one
      Share, granted pursuant to Section 8.
      Each
      Restricted Stock Unit represents an unfunded and unsecured obligation of the
      Company.

     

    (gg) “Rule 16b-3”
means
      Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3, as in
      effect when discretion is being exercised with respect to the Plan.

     

    (hh) “Service
      Provider”
means
      an Employee, Director or Consultant.

     

    (ii) “Share”
means
      a
      share of the Common Stock, as adjusted in accordance with
      Section 14
      below.

     

    (jj) “Stock
      Appreciation Right”
or
      “SAR”
means
      an Award, granted alone or in connection with an Option, that pursuant to
      Section 9
      is
      designated as an SAR.

     

    (kk) “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.

     

    (a) Subject
      Shares.
      Subject
      to the provisions of Section 14
      of the
      Plan, the maximum aggregate number of Shares that may be options and sold under
      this Plan is 10,000,000 Shares, plus
      an
      annual increase to be added on the first day of the Company’s fiscal year
      beginning with the Company’s 2009 fiscal year, equal to the lesser of
      (A) 5,000,000 Shares, or (B) five percent (5%) of the outstanding
      Shares on the last day of the immediately preceding Company fiscal year. The
      Shares may be authorized but unissued, or reacquired Common
      Stock.

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

    (b) Lapsed
      Awards.
      If an
      Award expires or becomes unexercisable without having been exercised in full,
      is
      surrendered pursuant to an Exchange Program, or, with respect to Restricted
      Stock, Restricted Stock Units or Performance Shares, is forfeited to or
      repurchased by the Company due to failure to vest, the unpurchased Shares (or
      for Awards other than Options or SARs the forfeited or repurchased Shares)
      which
      were subject thereto will become available for future grant or sale under the
      Plan (unless the Plan has terminated). With respect to SARs, only Shares
      actually issued pursuant to an SAR will cease to be available under the Plan;
      all remaining Shares under SARs will remain available for future grant or sale
      under the Plan (unless the Plan has terminated). Shares that have actually
      been
      issued under the Plan under any Award will not be returned to the Plan and
      will
      not become available for future distribution under the Plan; provided, however,
      that if Shares of Restricted Stock or Performance Shares are repurchased by
      the
      Company or are forfeited to the Company due to their failure to vest, such
      Shares will become available for future grant under the Plan. Shares used to
      pay
      the exercise price of an Award or to satisfy the minimum statutory withholding
      obligations related to an Award will become available for future grant or sale
      under the Plan. Notwithstanding the foregoing and, subject to adjustment as
      provided in Section 14,
      the
      maximum number of Shares that may be issued upon the exercise of Incentive
      Stock
      Options shall equal the aggregate Share number stated in
      Section 3(a),
      plus,
      to the extent allowable under Section 422 of the Code, any Shares that
      become available for issuance under the Plan under this
      Section 3(b).

     

    (c) Share
      Reserve.
      The
      Company, during the term of this Plan, will at all times reserve and keep
      available such number of Shares as will be sufficient to satisfy the
      requirements of the Plan.

     

    4. Administration
      of the Plan.

     

    (a) Procedure.

     

    (i) Multiple
      Administrative Bodies.
      Different Committees with respect to different groups of Service Providers
      may
      administer the Plan.

     

    (ii) Section 162(m).
      To the
      extent that the Administrator determines it to be desirable to qualify Options
      granted hereunder as “performance-based compensation” within the meaning of
      Section 162(m) of the Code, the Plan will be administered by a Committee of
      two
      or more “outside directors” within the meaning of Section 162(m) of the
      Code.

     

    (iii) (iii) Rule 16b-3.
      To the
      extent desirable to qualify transactions hereunder as exempt under
      Rule 16b-3, the transactions contemplated hereunder will be structured to
      satisfy the requirements for exemption under Rule 16b-3.

     

    (iv) Other
      Administration.
      Other
      than as provided above, the Plan will be administered by the Board or a
      Committee, which committee will be constituted to satisfy Applicable
      Laws.

     

    (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, and subject to the
      approval of any relevant authorities, the Administrator will have the authority,
      in its discretion:

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

    (i) to
      determine the Fair Market Value;

     

    (ii) to
      select
      the Service Providers to whom Awards may be granted hereunder;

     

    (iii) to
      determine the number of Shares to be covered by each Award granted
      hereunder;

     

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

     

    (v) to
      determine the terms and conditions, 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 Awards 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
      Award or the Shares relating thereto, based in each case on such factors as
      the
      Administrator will determine;

     

    (vi) to
      institute an Exchange Program;

     

    (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,
      including rules and regulations relating to sub-plans established for the
      purpose of satisfying applicable foreign laws; 

     

    (ix) to
      modify
      or amend each Award (subject to Section 26(c)
      of the
      Plan), including the discretionary authority to extend the post-termination
      exercisability period of Awards longer than is otherwise provided for in the
      Plan (subject to compliance with Code Section 409A);

     

    (x) to
      allow
      Participants to satisfy withholding tax obligations in such manner as prescribed
      in Section 15;

     

    (xi) to
      authorize any person to execute on behalf of the Company any instrument required
      to effect the grant of an Award previously granted by the
      Administrator;

     

    (xii) to
      allow
      a Participant to defer the receipt of the payment of cash or the delivery of
      Shares that would otherwise be due to such Participant under an
      Award

     

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

     

    (c) Effect
      of Administrator’s Decision.
      All
      decisions, determinations and interpretations of the Administrator shall be
      final and binding on all Participants and any other holders of Awards.

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

    5. Eligibility.
      Nonstatutory Stock Options, Restricted Stock, Restricted Stock Units, Stock
      Appreciation Rights and Performance Shares may be granted to Service Providers.
      Incentive Stock Options may be granted only to Employees.

     

    6. Stock
      Options.
      Each
      Option shall be in such form and shall contain such terms and conditions as
      the
      Administrator shall deem appropriate. All Options shall be designated Incentive
      Stock Options or Nonstatutory Stock Options at the time of grant, and, if
      certificates are issued, a separate certificate or certificates shall be issued
      for Shares purchased on exercise of each type of Option. If an Option is not
      specifically designated as an Incentive Stock Option, then the Option shall
      be a
      Nonstatutory Stock Option. The provisions of separate Options need not be
      identical; provided, however, that each Option Agreement shall provide the
      number of Shares covered by the Option and shall include (through incorporation
      of the provisions of this Plan by reference in the Agreement or otherwise)
      the
      substance of each of the following provisions:

     

    (a) Limitations.
      Notwithstanding any designation to the contrary, to the extent that the
      aggregate Fair Market Value of the Shares with respect to which Incentive Stock
      Options are exercisable for the first time by the Participant during any
      calendar year (under all plans of the Company and any Parent or Subsidiary)
      exceeds $100,000, such Options will be treated as Nonstatutory Stock Options.
      For purposes of this Section 6(a),
      Incentive Stock Options will be taken into account in the order in which they
      were granted. The Fair Market Value of the Shares will be determined as of
      the
      time the Option with respect to such Shares is granted.

     

    (b) Term
      of Option.
      The
      term of each Option will be stated in the Award Agreement. In the case of an
      Incentive Stock Option, the term will be ten (10) years from the date of
      grant or such shorter term as may be provided in the Award Agreement. Moreover,
      in the case of an Incentive Stock Option granted to a Participant who, at the
      time the Incentive Stock Option is granted, owns stock representing more than
      ten percent (10%) of the total combined voting power of all classes of stock
      of
      the Company or any Parent or Subsidiary, the term of the Incentive Stock Option
      will be five (5) years from the date of grant or such shorter term as may
      be provided in the Award Agreement.

     

    (c) Option
      Exercise Price.
      The per
      share exercise price for the Shares to be issued upon exercise of an Option
      shall be determined by the Administrator, subject to the following:

     

    (i) In
      the
      case of an Incentive Stock Option

     

    (A) granted
      to an Employee who, at the time the Incentive Stock Option is granted, owns
      stock representing more than ten percent (10%) of the voting power of all
      classes of stock of the Company or any Parent or Subsidiary, the per Share
      exercise price will be no less than 110% of the Fair Market Value per Share
      on
      the date of grant.

     

    (B) granted
      to any Employee other than an Employee described in paragraph
      (A) immediately above, the per Share exercise price will be no less than
      100% of the Fair Market Value per Share on the date of grant. 

     

    (C) Notwithstanding
      the foregoing, Incentive Stock Options may be granted with a per Share exercise
      price of less than 100% of the Fair Market Value per Share on the date of grant
      pursuant to a transaction described in, and in a manner consistent with, Section
      424(a) of the Code.

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

    (ii) In
      the
      case of a Nonstatutory Stock Option, the per Share exercise price shall be
      no
      less than 100% of the Fair Market Value per Share on the date of
      grant.

     

    (d) Vesting
      and Exercise Dates.
      At the
      time an Option is granted, the Administrator will fix the period within which
      the Option may be exercised and will determine any conditions that must be
      satisfied before the Option may be exercised. The total number of Shares subject
      to an Option may become exercisable in periodic installments that may or may
      not
      be equal. The Option may be subject to such other terms and conditions on the
      time or times when it may or may not be exercised (which may be based on the
      satisfaction of performance goals or other criteria) as the Administrator may
      deem appropriate. The vesting provisions of individual Options may vary. The
      provisions of this Section 6(d)
      are
      subject to any Option provisions governing the minimum number of Shares as
      to
      which an Option may be exercised.

     

    (e) Consideration.
      The
      Administrator will determine the acceptable form of consideration for exercising
      an Option, including the method of payment. In the case of an Incentive Stock
      Option, the Administrator will determine the acceptable form of consideration
      at
      the time of grant. Permitted forms of consideration and methods of payment
      are
      as follows:

     

    (i) cash,
      check, bank draft or money order payable to the Company

     

    (ii) pursuant
      to a program developed under Regulation T as promulgated by the Federal Reserve
      Board that, prior to the issuance of the stock subject to the Option, results
      in
      either the receipt of cash (or check) by the Company or the receipt of
      irrevocable instructions to pay aggregate exercise price to the Company from
      the
      sales proceeds;

     

    (iii) by
      a “net
      exercise” arrangement pursuant to which the Company will reduce the number of
      Shares issued upon exercise by the largest whole number of Shares with a Fair
      Market Value that does not exceed the aggregate exercise price; provided,
      however, that the Company shall accept a cash or other payment from the
      Participant to the extent of any remaining balance of the aggregate exercise
      price not satisfied by such reduction in the number of whole Shares to be
      issued; provided, further, that Shares covered by an Option will no longer
      be
      exercisable to the extent that such Shares (i) are used to pay the exercise
      price pursuant to the “net exercise,” (ii) are delivered to the Participant as a
      result of such exercise, and (iii) are withheld to satisfy tax withholding
      obligations;

     

    (iv) other
      Shares, provided Shares acquired directly or indirectly from the Company,
      (i) have been owned by the Participant and not subject to substantial risk
      of forfeiture for more than six months on the date of surrender, and
      (ii) have a Fair Market Value on the date of surrender equal to the
      aggregate exercise price of the Shares as to which said Option will be
      exercised;

     

    (v) according
      to a deferred payment or similar arrangement with the Participant; provided,
      however, that interest shall compound at least annually and shall be charged
      at
      the minimum rate of interest necessary to avoid (i) the imputation of interest
      income to the Company and compensation income to the Participant under any
      applicable provisions of the Code, and (ii) the classification of the Option
      as
      a liability for financial accounting purposes;

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

    (vi) such
      other consideration and method of payment for the issuance of Shares to the
      extent permitted by Applicable Laws; or

     

    (vii) any
      combination of the foregoing methods of payment.

     

    (f) Exercise
      of Option.

     

    (i) Procedure
      for Exercise.
      Any
      Option granted hereunder will be exercisable according to the terms of the
      Plan
      and at such times and under such conditions as determined by the Administrator
      and set forth in the Award Agreement. An Option may not be exercised for a
      fraction of a Share.

     

    An
      Option
      will be deemed exercised when the Company receives: (i) notice of exercise
      (in such form as the Administrator specify from time to time) from the person
      entitled to exercise the Option, and (ii) full payment for the Shares with
      respect to which the Option is exercised (together with an applicable
      withholding taxes). Full payment may consist of any consideration and method
      of
      payment authorized by the Administrator and permitted by the Award Agreement
      and
      the Plan. Shares issued upon exercise of an Option will be issued in the name
      of
      the Participant or, if requested by the Participant, in the name of the
      Participant and his or her spouse. The Company will issue (or cause to be
      issued) such Shares promptly after the Option is exercised. No adjustment will
      be made for a dividend or other right for which the record date is prior to
      the
      date the Shares are issued, except as provided in Section 14
      of the
      Plan.

     

    Exercising
      an Option in any manner will decrease the number of Shares thereafter 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.

     

    (g) Termination
      of Relationship as a Service Provider.

     

    (i) Termination
      other than for Cause.
      If a
      Participant ceases to be a Service Provider (other than for Cause), the
      Participant (or in the case of the death of the Participant, by the
      Participant’s designated beneficiary, provided such beneficiary has been
      designated prior to Participant’s death in a form acceptable to the
      Administrator) may exercise his or her Option within such period of time as
      is
      specified in the Award Agreement to the extent that the Option is vested on
      the
      date of termination (but in no event later than the expiration of the term
      of
      such Option as set forth in the Award Agreement). In the absence of a specified
      time in the Award Agreement, the Option will remain exercisable for a period
      following such termination equal to (A) three (3) months plus (B) an
      additional three (3) months for each consecutive 12-month period Participant
      continues to be a Service Provider after the date of grant of such Option;
      provided that with respect to an Option designated as an Incentive Stock Option,
      the Option will remain exercisable for three (3) months following such
      termination (or twelve (12) months following such termination in the event
      the
      Participant ceases to be a Service provider as a result of the Participant’s
      death or Disability). Unless otherwise provided by the Administrator, if on
      the
      date of such termination the Participant is not vested as to his or her entire
      Option, the Shares covered by the unvested portion of the Option will revert
      to
      the Plan. If after termination the Participant does not exercise his or her
      Option within the time specified by the Administrator, the Option will
      terminate, and the Shares covered by such Option will revert to the
      Plan.

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

    

    (ii) Termination
      for Cause.
      Except
      as explicitly provided otherwise in a Participant’s Award Agreement, in the
      event that a Participant’s continuous status as a Service Provider is terminated
      for Cause, the Option shall terminate upon the termination date of such
      continuous status as a Service Provider, and the Service Provider shall be
      prohibited from exercising his or her Option from and after the time of such
      termination of continuous status as Service Provider.

     

    (h) Extension
      of Termination Date.
      Except
      as otherwise provided in the Award Agreement or other agreement between the
      Participant and the Company, if the exercise of an Option following the
      termination of the Participant’s continuous status as a Service Provider (other
      than upon the Participant’s death or Disability of for Cause) would be
      prohibited at any time solely because the issuance of Shares would violate
      the
      registration requirements under the Securities Act, then the Option shall
      terminate on the earlier of (A) the expiration of the applicable period
      described in Section 6(g)(i)
      during
      which the exercise of the Option would not be in violation of such registration
      requirements, or (B) the expiration of the term of the Option as set forth
      in
      the Award Agreement.

     

    (i) Non-Exempt
      Employees.
      No
      Option granted to an Employee that is a non-exempt employee for purposes of
      the
      Fair Labor Standards Act of 1938, as amended, shall be first exercisable for
      any
      Shares until at least six (6) months following the date of the grant of the
      Option. The foregoing provision is intended to operate so that any income
      derived by a non-exempt employee in connection with the exercise or vesting
      of
      an Option will be exempt from his or her regular rate of pay.

     

    (j) Early
      Exercise.
      The
      Option may, but need not, include a provision whereby the Participant may elect
      at any time before the Provider’s continuous status as a Service Provider
      terminates to exercise the Option as to any part or all of the Shares subject
      to
      the Option prior to the full vesting thereof. Subject to the “Repurchase
      Limitation” in Section 24
      (the
“Repurchase
      Limitation”),
      any
      unvested Shares so purchased may be deemed to be Restricted Stock subject to
      a
      repurchase option in favor of the Company or to any other restriction the
      Administrator determines to be appropriate. Provided that the Repurchase
      Limitation is not violated, the Company shall not be required to exercise its
      repurchase option until at least six (6) months (or such other period of time
      required to avoid classification of the Option as a liability for financial
      accounting purposes) have elapsed following exercise of the Option unless the
      Administrator otherwise specifically provides in the Award
      Agreement.

     

    (k) Right
      of Repurchase.
      Subject
      to the Repurchase Limitation, the Option may include a provision whereby the
      Company may elect to repurchase all or any part of the vested Shares acquired
      by
      the Participant pursuant to the exercise of the Option.

     

    (l) Right
      of First Refusal.
      The
      Option may include a provision whereby the Company may elect to exercise a
      right
      of first refusal following receipt of notice from the Participant of the intent
      to transfer all or any part of the Shares received upon exercise of the Option.
      Such right of first refusal shall be subject to the Repurchase Limitation.
      Except as expressly provided in this Section 6(f)
      or in
      the Award Agreement, such right of first refusal shall otherwise comply with
      any
      applicable provisions of the Bylaws of the Company.

    
      
         

      

      
        -10-

        
          

        

      

      
         

      

    

    7. Restricted
      Stock.
      Subject
      to the terms and provisions of the Plan, the Administrator, at any time and
      from
      time to time, may grant Shares of Restricted Stock to Service Providers in
      such
      amounts as the Administrator, in its sole discretion, will determine. Each
      Award
      of Restricted Stock will be evidenced by an Award Agreement that shall be in
      such form and shall contain such terms and conditions as the Administrator
      shall
      deem appropriate. The terms and conditions of Restricted Stock Award Agreements
      may change from time to time and the terms and conditions of separate Restricted
      Stock Award Agreements need not be identical; provided, however, that each
      Restricted Stock Award Agreement shall specify the number of Shares granted,
      and
      shall include (through incorporation of the provisions of this Plan by reference
      in the Agreement or otherwise) the substance of each of the following
      provisions:

     

    (a) Consideration.
      A
      Restricted Stock Award may be awarded in consideration for (i) past or future
      services actually or to be rendered to the Company or an affiliate or (ii)
      any
      other form of legal consideration that may be acceptable to the Administrator
      in
      its sole discretion and permissible under applicable law.

     

    (b) Risk
      of Forfeiture.
      Subject
      to the Repurchase Limitation, Shares awarded under the Restricted Stock Award
      Agreement may be subject to a substantial risk of forfeiture to the Company
      and
      in accordance with a vesting schedule to be determined by the Administrator.
      Such restrictions may be based on the passage of time, the achievement of target
      levels of performance, or the occurrence of other events as determined by the
      Administrator.

     

    (c) Transferability.
      Rights
      to acquire Shares under a Restricted Stock Award Agreement shall be transferable
      by the Participant only upon such terms and conditions as are set forth in
      such
      Award Agreement, as the Administrator shall determine in its sole discretion,
      so
      long as Shares awarded under the Restricted Stock Award Agreement remains
      subject to the terms of such Award Agreement.

     

    (d) Other
      Restrictions.
      The
      Administrator, in its sole discretion, may impose such other restrictions on
      Shares of Restricted Stock as it may deem advisable or appropriate.

     

    (e) Removal
      of Restrictions.
      Unless
      the Administrator determines otherwise, the Company as escrow agent will hold
      Shares of Restricted Stock. Shares of Restricted Stock covered by each
      Restricted Stock Award made under the Plan will be released from escrow as
      soon
      as practicable after the risk of forfeiture of such Shares has lapsed or at
      such
      other time as the Administrator may determine. The Administrator, in its
      discretion, may accelerate the time at which any restrictions will lapse or
      be
      removed.

     

    (f) Voting
      Rights.
      Service
      Providers holding Shares of Restricted Stock granted hereunder may exercise
      full
      voting rights with respect to those Shares, unless the Administrator determines
      otherwise.

     

    (g) Dividends
      and Other Distributions.
      Service
      Providers holding Shares of Restricted Stock will be entitled to receive all
      dividends and other distributions paid with respect to such Shares unless
      otherwise provided in the Award Agreement. If any such dividends or
      distributions are paid in Shares, the Shares will be subject to the same
      restrictions on transferability and forfeitability as the Shares of Restricted
      Stock with respect to which they were paid.

    
      
         

      

      
        -11-

        
          

        

      

      
         

      

    

    (h) Return
      of Restricted Stock to Company.
      On the
      date set forth in the Award Agreement, the Restricted Stock for which
      restrictions have not lapsed will revert to the Company and again will become
      available for grant under the Plan.

     

    8. Restricted
      Stock Units.
      Restricted Stock Units may be granted at any time and from time to time as
      determined by the Administrator. After the Administrator determines to grant
      Restricted Stock Units under the Plan, it shall issue a Restricted Stock Unit
      Award Agreement. Each Restricted Stock Unit Award Agreement shall be in such
      form and shall contain such terms and conditions as the Administrator shall
      deem
      appropriate. The terms and conditions of Restricted Stock Unit Award Agreements
      may change from time to time and the terms and conditions of separate Restricted
      Stock Unit Award Agreements need not be identical; provided, however, that
      each
      Restricted Stock Unit Award Agreement shall specify the number of Restricted
      Stock Units granted, and shall include (through incorporation of the provisions
      of this Plan by reference in the Agreement or otherwise) the substance of each
      of the following provisions:

     

    (a) Consideration.
      At the
      time of grant of a Restricted Stock Unit Award, the Administrator will determine
      the consideration, if any, to be paid by the Participant upon delivery of each
      Share subject to the Restricted Stock Unit Award. The consideration to be paid,
      if any, by the Participant for each Share subject to a Restricted Stock Unit
      Award may be paid in any form of legal consideration that may be acceptable
      to
      the Administrator in its sole discretion and permissible under applicable
      law.

     

    (b) Vesting
      Criteria.
      At the
      time of the grant of a Restricted Stock Unit Award, the Administrator shall
      set
      vesting criteria in its discretion, which, depending on the extent to which
      the
      criteria are met, will determine the number of Restricted Stock Units that
      will
      be paid out to the Participant. The Administrator may set vesting criteria
      based
      upon the achievement of Company-wide, business unit, or individual goals
      (including, but not limited to, continued employment), or any other basis
      determined by the Administrator in its discretion.

     

    (c) Earning
      Restricted Stock Units.
      Upon
      meeting the applicable vesting criteria, the Participant shall be entitled
      to
      receive a payout as specified in the Restricted Stock Unit Award Agreement.
      Notwithstanding the foregoing, at any time after the grant of Restricted Stock
      Units, the Administrator, in its sole discretion, may reduce or waive any
      vesting criteria that must be met to receive a payout.

     

    (d) Form
      and Timing of Payment.
      Payment
      of earned Restricted Stock Units shall be made as soon as practicable after
      the
      date(s) set forth in the Restricted Stock Unit Award Agreement. The
      Administrator may settle earned Restricted Stock Units in Shares, their cash
      equivalent or in any other form of consideration, as determined by the
      Administrator and contained in the Restricted Stock Unit Award
      Agreement.

     

    (e) Additional
      Restrictions.
      At the
      time of the grant of a Restricted Stock Unit Award, the Administrator, as it
      deems appropriate, may impose such restrictions or conditions that delay the
      delivery of the Shares (or other consideration) subject to a Restricted Stock
      Unit Award to a time after the vesting of such Restricted Stock Unit
      Award.

    
      
         

      

      
        -12-

        
          

        

      

      
         

      

    

    (f) Dividend
      Equivalents.
      Dividend equivalents may be credited in respect of Shares covered by a
      Restricted Stock Unit Award, as determined by the Administrator and contained
      in
      the Restricted Stock Unit Award Agreement. At the sole discretion of the
      Administrator, such dividend equivalents may be converted into additional Shares
      covered by the Restricted Stock Unit Award in such a manner as determined by
      the
      Administrator. Any additional Shares covered by the Restricted Stock Unit Award
      credited by reason of such dividend equivalents will be subject to all the
      terms
      and conditions of the underlying Restricted Stock Unit Award Agreement to which
      they relate.

     

    (g) Termination
      of Participant’s Continuous Service.
      Except
      as otherwise provided in the applicable Restricted Stock Unit Award Agreement,
      such portion of the Restricted Stock Unit Award that has not vested will be
      forfeited upon the termination of Participant’s continuous status as a Service
      Provider.

     

    (h) Cancellation.
      On the
      date set forth in the Restricted Stock Unit Award Agreement, all unearned
      Restricted Stock Units shall be forfeited to the Company.

     

    9. Stock
      Appreciation Rights.
      Subject
      to the terms and conditions of the Plan, an SAR may be granted to Service
      Providers at any time and from time to time as will be determined by the
      Administrator, in its sole discretion. The Administrator will have complete
      discretion to determine the number of SARs granted to any Service Provider.
      SAR
      Award will be evidenced by an Award Agreement that shall be in such form and
      shall contain such terms and conditions as the Administrator shall deem
      appropriate. The terms and conditions of SAR Award Agreements may change from
      time to time and the terms and conditions of separate SAR Award Agreements
      need
      not be identical; provided, however, that each SAR Award Agreement shall specify
      the number of Shares covered by such SAR, and shall include (through
      incorporation of the provisions of this Plan by reference in the Agreement
      or
      otherwise) the substance of each of the following provisions:

     

    (a) Exercise
      Price and Other Terms.
      Each
      SAR will be denominated in Share equivalents. The per share exercise price
      for
      the Shares equivalents to be issued pursuant to exercise of an SAR shall be
      determined by the Administrator and shall be no less than 100% of the Fair
      Market Value of the Share equivalents on the date of grant. Otherwise, subject
      to Section 6(a)
      of the
      Plan, the Administrator, subject to the provisions of the Plan, shall have
      complete discretion to determine the terms and conditions of SARs granted under
      the Plan. Notwithstanding the foregoing, the rules of Section 6(f)
      also
      will apply to SARs.

     

    (b) SAR
      Agreement.
      Each
      SAR grant will be evidenced by an Award Agreement that will specify the exercise
      price, the term of the SAR, the conditions of exercise, and such other terms
      and
      conditions as the Administrator, in its sole discretion, will
      determine.

     

    (c) Term
      of SARs.
      An SAR
      granted under the Plan will expire upon the date determined by the
      Administrator, in its sole discretion, and set forth in the Award Agreement;
      provided, however, that no SAR may have a term of more than ten (10) years
      from the date of grant.

    
      
         

      

      
        -13-

        
          

        

      

      
         

      

    

    (d) Payment
      of SAR Amount.
      Upon
      exercise of an SAR, a Participant will be entitled to receive payment from
      the
      Company in an amount determined by multiplying:

     

    (i) The
      difference between the Fair Market Value of a Share on the date of exercise
      over
      the exercise price, times

     

    (ii) The
      number of Shares with respect to which the SAR is exercised.

     

    The
      payment upon exercise of an SAR may be in Shares of equivalent value (rounded
      down to the nearest whole Share), in cash, in any combination of the two or
      in
      any other form of consideration , as determined by the Administrator and
      contained in the SAR Award Agreement evidencing such SAR.

     

    (e) Vesting.
      At the
      time of grant of an SAR, the Administrator may impose such restrictions or
      conditions to the vesting of such SAR as it, in its sole discretion, deems
      appropriate.

     

    (f) Exercise.
      To
      exercise any outstanding SAR, the Participant must provide written notice of
      exercise to the Company in compliance with the provisions of the SAR evidencing
      such SAR.

     

    (g) Non-Exempt
      Employees.
      No SAR
      granted to an Employee that is a non-exempt for purposes of the Fair Labor
      Standards Act of 1938, as amended, shall be first exercisable for any Shares
      until at least six (6) months following the date of the grant of such SAR.
      The
      foregoing provision is intended to operate so that any income derived by a
      non-exempt employee in connection with the exercise or vesting of an Option
      will
      be exempt from his or her regular rate of pay.

     

    (h) Termination
      of Relationship as a Service Provider.

     

    (i) Termination
      other than for Cause.
      If a
      Participant ceases to be a Service Provider (other than for Cause), the
      Participant (or in the case of the death of the Participant, by the
      Participant’s designated beneficiary, provided such beneficiary has been
      designated prior to Participant’s death in a form acceptable to the
      Administrator) may exercise his or her SAR within such period of time as is
      specified in the Award Agreement to the extent that the SAR is vested on the
      date of termination (but in no event later than the expiration of the term
      of
      such SAR as set forth in the Award Agreement). In the absence of a specified
      time in the Award Agreement, the SAR will remain exercisable for a period
      following such termination equal to (A) three (3) months plus (B) an
      additional three (3) months for each consecutive 12-month period the Participant
      continued to be a Service Provider after the date of grant of such SAR. Unless
      otherwise provided by the Administrator, if on the date of such termination
      the
      Participant is not vested as to his or her entire SAR, the Shares covered by
      the
      unvested portion of the SAR will revert to the Plan. If after termination the
      Participant does not exercise his or her SAR within the time specified by the
      Administrator, the SAR will terminate, and the Shares covered by such SAR will
      revert to the Plan.

     

    (ii) Termination
      for Cause.
      Except
      as explicitly provided otherwise in a Participant’s Award Agreement, in the
      event that a Participant’s continuous status as a Service Provider is terminated
      for Cause, the SAR shall terminate upon the termination date of such continuous
      status as a Service Provider, and the Provider shall be prohibited from
      exercising his or her SAR from and after the time of such termination of
      continuous status as Service Provider.

    
      
         

      

      
        -14-

        
          

        

      

      
         

      

    

    10. Performance
      Shares.

     

    (a) Grant
      of Performance Shares.
      Subject
      to the terms and conditions of the Plan, Performance Shares may be granted
      to
      Participants at any time as shall be determined by the Administrator, in its
      sole discretion. The Administrator shall have complete discretion to determine
      (i) the number of Shares subject to a Performance Share award granted to
      any Participant, and (ii) the conditions that must be satisfied, which
      typically will be based principally or solely on achievement of performance
      milestones but may include a service-based component, upon which is conditioned
      the grant or vesting of Performance Shares. Performance Shares shall be granted
      in the form of units to acquire Shares. Each such unit shall be the equivalent
      of one Share for purposes of determining the number of Shares subject to an
      Award.

     

    (b) Other
      Terms.
      The
      Administrator, subject to the provisions of the Plan, shall have complete
      discretion to determine the terms and conditions of Performance Shares granted
      under the Plan. Performance Share grants shall be subject to the terms,
      conditions, and restrictions determined by the Administrator at the time the
      stock is awarded, which may include such performance-based milestones as are
      determined appropriate by the Administrator. The Administrator may require
      the
      recipient to sign a Performance Shares Award Agreement as a condition of the
      award. Any certificates representing the Shares of stock awarded shall bear
      such
      legends as shall be determined by the Administrator.

     

    (c) Performance
      Share Award Agreement.
      Each
      Performance Share grant shall be evidenced by an Award Agreement that shall
      specify such other terms and conditions as the Administrator, in its sole
      discretion, shall determine.

     

    11. Formula
      Awards to Outside Directors.

     

    (a) General.
      Outside
      Directors will be entitled to receive all types of Awards (except Incentive
      Stock Options) under this Plan, including discretionary Awards not covered
      under
      this Section 11.
      All
      grants of Awards to Outside Directors pursuant to this Section 11
      will be
      automatic and nondiscretionary, except as otherwise provided herein, and will
      be
      made in accordance with the following provisions:

     

    (i) No
      Discretion.
      No
      person will have any discretion to select which Outside Directors will be
      granted Awards under this Section 11
      or to
      determine the number of Shares to be covered by such Awards (except as provided
      in Sections 11(c)
      and
14).

     

    (ii) Annual
      Award.
      Each
      Outside Director will be automatically granted a Nonstatutory Stock Option
      for
      200,000 Shares (an “Annual Award”) on each date of the annual meeting of the
      stockholders of the Company beginning in 2009 (or such other date as the
      Administrator shall determine), if as of such date, he or she will have served
      on the Board for at least the preceding six (6) months.

     

    (b) Terms.
      Each
      Award granted pursuant to this Section 11
      will be
      subject to the terms and conditions of the Plan and as follows:

    
      
         

      

      
        -15-

        
          

        

      

      
         

      

    

    (i) The
      term
      of the Award will be ten (10) years.

     

    (ii) The
      exercise price for Shares subject to Awards will be 100% of the Fair Market
      Value on the grant date.

     

    (iii) Subject
      to Section 14,
      the
      Annual Award shall vest and become exercisable as to one-twelfth (1/12th) of
      the
      Shares subject to such Award on the one-month anniversary of its date of grant
      and on the corresponding day of each month thereafter so as to be 100% vested
      on
      the one-year anniversary of its date of grant, provided that the Participant
      continues to serve as a Director through such date.

     

    (c) Amendment.
      The
      Administrator in its discretion may change the number of Shares subject to
      the
      Annual Awards.

     

    12. Leaves
      of Absence.
      Unless
      the Administrator provides otherwise, vesting of Awards granted hereunder will
      be suspended during any unpaid leave of absence. A Service Provider will not
      cease to be an Employee in the case of (i) any leave of absence approved by
      the Company or (ii) transfers between locations of the Company or between the
      Company, its Parent, or any Subsidiary. For purposes of Incentive Stock Options,
      no such leave may exceed ninety (90) days, unless reemployment upon
      expiration of such leave is guaranteed by statute or contract. If reemployment
      upon expiration of a leave of absence approved by the Company is not so
      guaranteed, then three (3) months following the 91st day of such leave any
      Incentive Stock Option held by the Participant will cease to be treated as
      an
      Incentive Stock Option and will be treated for tax purposes as a Nonstatutory
      Stock Option.

     

    13. Transferability
      of Awards.
      Unless
      determined otherwise by the Administrator, an Award may not be sold, pledged,
      assigned, hypothecated, transferred, or disposed of in any manner other than
      by
      will or by the laws of descent or distribution and may be exercised, during
      the
      lifetime of the Participant, only by the Participant. If the Administrator
      makes
      an Award transferable, such Award will contain such additional terms and
      conditions as the Administrator deems appropriate.

     

    14. Adjustments;
      Dissolution or Liquidation; Merger or Change in Control.

     

    (a) Adjustments.
      In the
      event that any dividend or other distribution (whether in the form of cash,
      Shares, other securities, or other property), recapitalization, stock split,
      reverse stock split, reorganization, merger, consolidation, split-up, spin-off,
      combination, repurchase, or exchange of Shares or other securities of the
      Company, or other change in the corporate structure of the Company affecting
      the
      Shares occurs, the Administrator, in order to prevent diminution or enlargement
      of the benefits or potential benefits intended to be made available under the
      Plan, may (in its sole discretion) adjust the number and class of Shares that
      may be delivered under the Plan, the number, class, and price of Shares covered
      by each outstanding Award, the numerical Share limits in
      Section 3
      of the
      Plan and the number of Shares issuable pursuant to Options to be granted under
      Section 11.

    
      
         

      

      
        -16-

        
          

        

      

      
         

      

    

    (b) Dissolution
      or Liquidation.
      Except
      as otherwise provided in an Award Agreement, in the event of the proposed
      dissolution or liquidation of the Company, the Administrator will notify each
      Participant as soon as practicable prior to the effective date of such proposed
      transaction. To the extent it has not been previously exercised, an Award (other
      than Award consisting of vested and outstanding Shares not subject to the
      Company’s right of repurchase) will terminate immediately prior to the
      consummation of such proposed action, and Shares subject to the Company’s
      repurchase option may be repurchased by the Company notwithstanding the fact
      that the status of the holder of such Award as a Service Provide remains
      continuous, provide, however, that the Administrator may, in its sole
      discretion, cause some or all Awards to become fully vested, exercisable or
      no
      longer subject to repurchase or forfeiture (to the extent such Awards have
      not
      previously expired or terminated) before the dissolution or liquidation is
      completed but contingent on its completion.

     

    (c) Change
      in Control.
      In the
      event of a merger or Change in Control, each outstanding Award will be treated
      as the Administrator determines, including, without limitation, that each Award
      be assumed or an equivalent option or right substituted by the successor
      corporation or a Parent or Subsidiary of the successor corporation. The
      Administrator shall not be required to treat all Awards similarly in the
      transaction.

     

    In
      the
      event that the successor corporation does not assume or substitute for the
      Award, except as otherwise provided in a Participant’s Award Agreement, the
      Participant will fully vest in and have the right to exercise all of his or
      her
      outstanding Options and Stock Appreciation Rights, including Shares as to which
      such Awards would not otherwise be vested or exercisable, all restrictions
      on
      Restricted Stock and Restricted Stock Units will lapse, and, with respect to
      Awards with performance-based vesting, all performance goals or other vesting
      criteria will be deemed achieved at 100% on-target levels and all other terms
      and conditions met. In addition, if an Option or Stock Appreciation Right is
      not
      assumed or substituted in the event of a Change in Control, the Administrator
      will notify the Participant in writing or electronically that the Option or
      Stock Appreciation Right will be exercisable for a period of time determined
      by
      the Administrator in its sole discretion, and the Option or Stock Appreciation
      Right will terminate upon the expiration of such period.

     

    For
      the
      purposes of this Section 14(c),
      an
      Award will be considered assumed if, following the Change in Control, the Award
      confers the right to purchase or receive, for each Share subject to the Award
      immediately prior to the Change in Control, the consideration (whether stock,
      cash, or other securities or property) received in the Change in Control 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 Change in Control
      is 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 an Option or Stock
      Appreciation Right or upon the payout of a Restricted Stock Unit or Performance
      Share, for each Share subject to such Award, 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 Change in Control.
      

     

    Notwithstanding
      anything in this Section 14(c)
      to the
      contrary, an Award that vests, is earned or paid-out upon the satisfaction
      of
      one or more performance goals will not be considered assumed if the Company
      or
      its successor modifies any of such performance goals without the Participant’s
      consent; provided, however, a modification to such performance goals only to
      reflect the successor corporation’s post-Change in Control corporate structure
      will not be deemed to invalidate an otherwise valid Award assumption.

    
      
         

      

      
        -17-

        
          

        

      

      
         

      

    

    (d) Outside
      Director Awards.
      With
      respect to Awards granted to an Outside Director that are assumed or substituted
      for, if on the date of or following such assumption or substitution the
      Participant’s status as a Director or a director of the successor corporation,
      as applicable, is terminated other than upon a voluntary resignation by the
      Participant (unless such resignation is at the request of the acquirer), then
      the Participant will fully vest in and have the right to exercise Options or
      Stock Appreciation Rights as to all of the Shares covered by such Awards,
      including Shares as to which such Awards would not otherwise be vested or
      exercisable, all restrictions on Restricted Stock and Restricted Stock Units
      will lapse, and, with respect to Performance Shares, all performance goals
      or
      other vesting criteria will be deemed achieved at 100% on-target levels and
      all
      other terms and conditions met.

     

    15. Tax
      Withholding.

     

    (a) Withholding
      Requirements.
      Prior
      to the delivery of any Shares, cash or other consideration pursuant to an Award
      (or exercise thereof), the Company will have the power and the right to deduct
      or withhold, or require a Participant to remit to the Company, an amount
      sufficient to satisfy federal, state, local, foreign or other taxes (including
      the Participant’s FICA obligation) required to be withheld with respect to such
      Award (or exercise thereof). 

     

    (b) Withholding
      Arrangements.
      The
      Administrator, in its sole discretion and pursuant to such procedures as it
      may
      specify from time to time, may permit a Participant to satisfy such tax
      withholding obligation, in whole or in part by (i) paying cash,
      (ii) electing to have the Company withhold otherwise deliverable cash or
      Shares having a Fair Market Value equal to the minimum statutory amount required
      to be withheld, or (iii) delivering to the Company already-owned Shares
      having a Fair Market Value equal to the minimum statutory amount required to
      be
      withheld. The Fair Market Value of the Shares to be withheld or delivered will
      be determined as of the date that the taxes are required to be
      withheld.

     

    16. No
      Effect on Employment or Service.
      Neither
      the Plan nor any Award will confer upon a Participant any right with respect
      to
      continuing the Participant’s relationship as a Service Provider with the
      Company, nor will they interfere in any way with the Participant’s right or the
      Company’s right to terminate such relationship at any time, with or without
      cause, to the extent permitted by Applicable Laws.

     

    17. Date
      of Grant.
      The
      date of grant of an Award will be, for all purposes, the date on which the
      Administrator makes the determination granting such Award, or such other later
      date as is determined by the Administrator. Notice of the determination will
      be
      provided to each Participant receiving an Award within a reasonable time after
      the date of the grant of such Award.

     

    18. Rights
      as a Stockholder.
      Until a
      Participant has satisfied all requirements for the exercise of the Award
      pursuant to its terms and the Shares subject to such Award are issued (as
      evidenced by the appropriate entry on the books of the Company or of a duly
      authorized transfer agent of the Company), the Participant shall not be deemed
      to be a shareholder of record and shall have no right to vote or receive
      dividends or any other rights as a shareholder will exist with respect to such
      Shares, notwithstanding the exercise of such Award.

    
      
         

      

      
        -18-

        
          

        

      

      
         

      

    

    19. No
      Employment or Other Service Rights.
      Nothing
      in the Plan, any Award Agreement or any other instrument executed thereunder
      or
      in connection with any Award granted pursuant thereto shall confer upon any
      Participant any right to continue to serve the Company or an affiliate in the
      capacity in effect at the time the Award was granted or shall affect the right
      of the Company or an affiliate to terminate (a) employment of an Employee with
      our without notice and with or without cause, (b) the service of a Consultant
      pursuant to the terms of such Consultant’s agreement with the Company or such
      affiliate or (c) the service of a Director pursuant to the Bylaws of the Company
      or such affiliate, and any applicable provisions of the corporate law of the
      state in which the Company or the affiliate is incorporated, as the case may
      be.

     

    20. Investment
      Assurances.
      The
      Company may require a Participant, as a condition of exercising or acquiring
      Shares under any Award, (a) to give written assurances satisfactory to the
      Company as to the Participant’s knowledge and experience in financial and
      business matters or to employ a purchaser representative reasonably
      knowledgeable and experienced in financial and business matters and that he
      or
      she is capable of evaluating, alone or together with the purchaser
      representative, the merits and risks of exercising the Award, and (b) to give
      written assurances satisfactory to the Company stating that the Participant
      is
      acquiring the Shares subject to the Award for the Participant’s own account and
      not with any present intention of selling or otherwise distributing the Shares.
      The foregoing requirements, and any assurances given pursuant to such
      requirements shall be inoperative if (x) the issuance of the shares upon the
      exercise or acquisition of Shares under the Award has been registered under
      a
      then currently effective registration statement under the Securities Act or
      (y)
      as to any particular requirement, a determination is made by counsel for the
      Company that such requirement need not be met in the circumstances under the
      then applicable securities laws. The Company may, upon advice of counsel to
      the
      Company, place legends on stock certificates issued under the Plan as such
      counsel deems necessary or appropriate in order to comply with applicable
      securities laws, including, but not limited to, legends restricting the transfer
      of the Shares.

     

    21. Deferrals.
      To the
      extent permitted by applicable law, the Administrator, in its sole discretion,
      may determine that the delivery of Shares or the payment of cash, upon the
      exercise, vesting or settlement of all or a portion of any Award may be deferred
      and may establish programs and procedures for deferral elections to be made
      by
      Participants. Deferrals by Participants will be made in accordance with Section
      409A of the Code. Consistent with Section 409A of the Code, the Administrator
      may provide for distributions while a Participant is still an employee. The
      Administrator is authorized to make deferrals of Awards and determine when,
      and
      in what annual percentages, Participants may receive payments, including lump
      sum payments, following the Participant’s termination of employment or
      retirement, and implement such other terms and conditions consistent with the
      provisions of the Plan and in accordance with applicable law.

    
      
         

      

      
        -19-

        
          

        

      

      
         

      

    

    22. Compliance
      with Section 409A of the Code.
      To the
      extent that the Administrator determines that any Award granted hereunder is
      subject to Section 409A of the Code, the Award Agreement evidencing such Award
      shall incorporate the terms and conditions necessary to avoid the consequences
      specified in Section 409A(a)(1) of the Code. To the extent applicable, the
      Plan
      and the Award Agreements shall be interpreted in accordance with Section 409A
      of
      the Code and Department of Treasury regulations and other interpretive guidance
      issued thereunder, including without limitation any such regulations or other
      guidance that may be issued or amended after the Effective Date. Notwithstanding
      any provision of the Plan to the contrary, in the event that following the
      Effective Date the Administrator determines that any Award may be subject to
      Section 409A of the Code and related Department of Treasury regulations
      (including such Department of Treasury guidance as may be issued after the
      Effective Date), the Administrator may adopt such amendments to the Plan and
      the
      applicable Award Agreement or adopt other policies and procedures (including
      amendments, policies and procedures with retroactive effect), or take any other
      actions, that the Administrator determines are necessary or appropriate to
      (a)
      exempt the Award from Section 409A of the Code or preserve the intended tax
      treatment of the benefits provided with respect to the Award, or (b) comply
      with
      the requirements of Section 409A of the Code and related Department of Treasury
      guidance.

     

    23. Compliance
      with Exemption Provided by Rule 12h-1(f).
      If: (a)
      the aggregate of the number of Participants and the number of holders of all
      other outstanding compensatory employee Awards to purchase Shares equals or
      exceeds five hundred (500) and (b) the assets of the Company at the end of
      the
      Company’s most recently completed fiscal year exceed $10 million, then the
      following restrictions shall apply during any period during which the Company
      does not have a class of its securities registered under Section 12 of the
      Exchange Act and is not required to file reports under Section 15(d) of the
      Exchange Act: (i) the Awards and, prior to exercise, the Shares acquired upon
      exercise of the Awards may not be transferred until the Company is no longer
      relying on the exemption provided by Rule 12h-1(f) promulgated under the
      Exchange Act (“Rule
      12h-1(f)”),
      except: (A) as permitted by Rule 701(c) promulgated under the Securities Act,
      (B) to a guardian upon the disability of the Participant, or (3) to an executor
      upon the death of the Participant (collectively, the “Permitted
      Transferees”);
      provided, however, the following transfers are permitted: (a) transfers by
      the
      Participant to the Company, and (b) transfer in connection with a Change in
      Control or other acquisition involving the Company, if following such
      transaction the Awards no longer remain outstanding and the Company is no longer
      relying on the exemption provided by Rule 12h-1(f): provided, further, that
      any
      Permitted Transferees may not further transfer the Awards, (ii) except as
      otherwise provided in (i) above, the Awards and Shares acquired upon exercise
      of
      the Awards are restricted as to any pledge, hypothecation, or other transfer,
      including any short position, any “put equivalent position” as defined by Rule
      16a-1(h) promulgated under the Exchange Act, or any “call equivalent position”
as defined by Rule 16a-1(b) promulgated under the Exchange Act by the
      Participant prior to exercise of an Award until the Company is no longer relying
      on the exemption provided by Rule 12h-1(f): and (iii) at any time that the
      Company is relying on the exemption provided by Rule 12h-1(f), the Company
      shall
      deliver to Participants (whether by physical or electronic delivery or written
      notice of the availability of the information on an internet site) the
      information required by Rule 701(e)(3), (4) and (5) promulgated under the
      Securities Act every six (6) months, including financial statements that are
      not
      more than one hundred eighty (180) days old; provided, however, that the Company
      may condition the delivery of such information upon the Participant’s agreement
      to maintain its confidentiality.

     

    24. Repurchase
      Limitation.
      The
      terms of any repurchase option shall be specified in the Award Agreement. The
      repurchase price for vested Shares shall be the Fair Market Value of Shares
      on
      the date of repurchase or such other price as determined by the Administrator
      at
      the time of the grant of the Award. The repurchase price for unvested Shares
      shall be (a) the lower of (i) the Fair Market Value of the Shares on the date
      of
      repurchase and (ii) their original purchase price or (b) such other price as
      determined by the Administrator at the time of the grant of the Award. However,
      the Company shall not exercise its repurchase option until at least six (6)
      months (or such other period of time necessary to avoid classification of the
      Award as a liability for financial accounting purposes) have elapsed following
      delivery of Shares subject to the Award, unless otherwise specifically provided
      by the Administrator.

    
      
         

      

      
        -20-

        
          

        

      

      
         

      

    

    25. Term
      of Plan.
      The
      Plan will become effective upon the Effective Date and will continue in effect
      for a term of ten (10) years unless terminated earlier under
      Section 26
      of the
      Plan. 

     

    26. Amendment
      and Termination of the Plan. 

     

    (a) Amendment
      and Termination.
      The
      Administrator may at any time amend, alter, suspend or terminate the
      Plan.

     

    (b) Stockholder
      Approval.
      The
      Company will obtain stockholder approval of any Plan amendment to the extent
      necessary and desirable to comply with Applicable Laws.

     

    (c) Effect
      of Amendment or Termination.
      No
      amendment, alteration, suspension or termination of the Plan will impair the
      rights of any Participant, unless mutually agreed otherwise between the
      Participant and the Administrator, which agreement must be in writing and signed
      by the Participant and the Company. Termination of the Plan will not affect
      the
      Administrator’s ability to exercise the powers granted to it hereunder with
      respect to Awards granted under the Plan prior to the date of such
      termination.

     

    27. Choice
      of Law.
      The
      laws of the State of Delaware, without regard to conflict of laws rules, shall
      govern all questions concerning the construction, validity and interpretation
      of
      this Plan.

     

    28. Conditions
      Upon Issuance of Shares.

     

    (a) Legal
      Compliance.
      Shares
      will not be issued pursuant to the exercise of an Award unless the exercise
      of
      such Award and the issuance and delivery of such Shares will comply with
      Applicable Laws and will be further subject to the approval of counsel for
      the
      Company with respect to such compliance.

     

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

     

    29. Inability
      to Obtain Authority.
      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, will relieve the
      Company of any liability in respect of the failure to issue or sell such Shares
      as to which such requisite authority will not have been obtained.

     

    
      
         

      

      
        -21-

        
          

        

      

      
         

      

    

     

    30. Stockholder
      Approval.
      The
      Plan will be subject to approval by the stockholders of the Company within
      twelve (12) months after the date the Plan is adopted. Such stockholder
      approval will be obtained in the manner and to the degree required under
      Applicable Laws.

     

    (Remainder
      of Page Intentionally Left Blank)

    
      
         

      

      
        -22-EXHIBIT
      10.18

    

    CHANGE
      OF CONTROL AGREEMENT

    

    THIS
      AGREEMENT is made as of the  
      day
      of 
      , 2008,
      between UNION NATIONAL FINANCIAL CORPOATION, a Pennsylvania business corporation
      having a place of business at 570 Lausch Lane, Pennsylvania, 17601
      (“Corporation”), UNION NATIONAL COMMUNITY BANK (“Bank”) a national banking
      association having a place of business at 570 Lausch Lane, Pennsylvania, 17601
      and ___________ (“Executive”), an individual residing in Pennsylvania
      (collectively the “Parties” and, individually, sometimes a
“Party”).

    

    W
      I T N E
      S S E T H:

    

    WHEREAS,
      the Corporation is a registered bank holding company;

    

    WHEREAS,
      the Bank is a subsidiary of the Corporation;

    

    WHEREAS,
      the Executive has been employed by the Bank as __________________; 

    

    WHEREAS,
      this Agreement will become operative only upon a Change of Control (as defined
      herein); and

    

    WHEREAS,
      the purpose of this Agreement is to define certain severance benefits that
      will
      be paid by the Corporation in the event of a Change of Control (as defined
      herein), but is not intended to affect, nor does it affect, the terms of the
      Executive’s employment at will, in the absence of a Change of Control (as
      defined herein) of the Corporation. 

    

    NOW
      THEREFORE, in consideration of the Executive’s service to the Corporation and of
      the mutual covenants, undertakings and agreements set forth herein and intending
      to be legally bound hereby, the Parties agree as follows:

    

    1. TERM.
      The
      term of the Agreement shall be effective as of the day and year written above,
      and shall continue until either Executive or Corporation or Bank gives the
      other
      written notice of termination of employment, with or without cause; provided,
      however, that during the period of time between the execution of an agreement
      to
      effect a Change of Control (as defined herein) and the actual Date of Change
      of
      Control (as defined herein), termination of the Executive’s employment shall
      only be for Cause (as defined herein).

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    2. DEFINITION
      OF CAUSE. The term “Cause” shall be defined, for purposes of this Agreement, as
      the occurrence of one or more of the following:

    

    (i) Executive’s
      willful failure to perform the duties assigned to him, other than a failure
      resulting from Executive’s incapacity because of physical or mental
      illness;

    

    (ii) Executive’s
      failure to follow the good faith lawful instructions of the President and Chief
      Executive Officer of the Corporation or his designee with respect to its
      operations; 

    

    (iii) Executive’s
      willful engagement in misconduct which is materially injurious to the
      Corporation or the Bank;

     

    (iv) Executive’s
      intentional violation of the provisions of this Agreement; 

    

    (v)
       Executive’s
      willful and deliberate violation of any banking law or regulation, or any final
      cease and desist order issued by a bank regulatory authority; 

    

    (vi) Executive’s
      conviction of or entering into a plea of nolo contender to a felony, a crime
      of
      falsehood or to a crime involving moral turpitude;

    

    (vii)
       Executive’s
      suspension, removal, or prohibition from being an institutional-affiliated
      party
      by a final order of an appropriate federal banking agency pursuant to Section
      8(e) or 8(g) of the Federal Deposit Insurance Act or by the Office of the
      Comptroller of the Currency pursuant to federal law; 

    

    (viii) Executive’s
      commission of any act of moral turpitude or other illicit or illegal conduct
      which brings public discredit or results in financial loss to the Corporation
      or
      the Bank;

    

    (ix) Executive’s
      dishonesty or gross negligence in the performance of his duties;

    

    (x) Executive’s
      breach of fiduciary duty involving personal gain; 

    

    (xi) unlawful
      harassment by the Executive against employees, customers, business associates,
      contractors, or vendors of the Corporation or Bank which results or may be
      reasonably expected to result in material liability to the Corporation or
      Bank;

    

    (xii) theft
      or
      abuse by Executive of the Corporation’s or Bank’s property or the property of
      Corporation’s or Bank’s customers, employees, contractors, vendors, or business
      associates; 

    

    (xiii)
       Executive’s
      commission of any act of fraud, misappropriation, or personal dishonesty;

    

    (xiv) insubordination
      as determined by an affirmative vote of seventy-five percent (75%) of the Board
      of Directors of the Corporation or Bank; or

    

    (xv) the
      existence of any material conflict between the interests of the Corporation
      or
      Bank and the Executive that is not disclosed in writing by the Executive to
      the
      Corporation and Bank and approved in writing by the Boards of Directors of
      the
      Corporation and Bank. 

    

    3. DEFINITION
      OF CHANGE OF CONTROL.  As
      used
      in this Agreement, “Change of Control” shall mean: A change of control (other
      than one occurring by reason of an acquisition of the Corporation by Executive)
      wherein the Board of Directors certifies that one of the following has occurred:
      

     

    (a)
      any
“person” or more than one person acting as a group (as such term is defined in
      Section 409A of the Internal Revenue Code of 1986, as amended (“Code”) and any
      Internal Revenue Guidance and regulations under Section 409A of the Code),
      other
      than Bank and Corporation or any “person” who on the date hereof is a director
      or officer of Bank and Corporation, acquires ownership of stock of the
      Corporation together with stock held by such person constituting more than
      fifty
      percent (50%) of the total fair market value or total voting power of the stock
      of the Corporation; or 

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    (b)
      any
“person” or more than one person acting as a group (as such term is defined in
      Section 409A of the Code and any Internal Revenue Guidance and regulations
      under
      Section 409A of the Code), acquires (or has acquired during the 12-month period
      ending on the date of the most recent acquisition by such person or persons)
      ownership of stock of the Corporation possessing thirty-five percent (35%)
      or
      more of the total voting power of the stock of the Corporation; or 

     

    (c)
      during any period of one (1) year during this Agreement, individuals who at
      the
      beginning of such period constitute the Board of Directors of Corporation cease
      for any reason to constitute at least a majority thereof, unless the election
      of
      each director who was not a director at the beginning of such period has been
      approved in advance by directors representing at least two-thirds (2/3) of
      the
      directors then in office who were directors at the beginning of the period.
      

    

    4. DEFINITION
      OF DATE OF CHANGE OF CONTROL. For purposes of this Agreement, the “Date of
      Change of Control” shall mean:  

    

    (a)
       the
      first
      date on which any person or more than one person acting as a group acquire
      ownership of fifty percent (50%) or more of the total fair market value or
      total
      voting power of the stock of the Corporation; 

    

    (b) the
      date
      on which any person or more than one person acting as a group acquires ownership
      of stock of the Corporation possessing thirty-five percent (35%) or more of
      the
      total voting power of the stock of the Corporation; 

    

    (c)
       the
      date
      on which individuals who formerly constituted a majority of the Board of
      Directors of the Corporation under Section 3(c) hereof and the replacement
      Director’s otherwise approved under Section 3(c), ceased to be a majority within
      a one year period. 

    

    5. TERMINATION
      OF EMPLOYMENT FOLLOWING A CHANGE OF CONTROL.

    

    If
      a
      Change of Control (as defined in Section 3 of this Agreement) shall occur and
      thereafter, there shall be:

    

    (i) any
      involuntary termination of Executive’s employment (other than for the reasons
      set forth in Section 2 of this Agreement); 

    

    (ii) 
      any
      reassignment of Executive to a location greater than fifty (50) miles from
      the
      location of Executive’s office on the date of the Change of
      Control;

    

    (iii) any
      reduction in Executive’s Annual Base Salary in effect on the date of the Change
      of Control or as the same may be increased from time to time after the Change
      of
      Control; or

    

    (iv) any
      failure to provide Executive with benefits at least as favorable as those
      enjoyed by Executive under any of Corporation’s or Bank’s retirement or pension,
      life insurance, medical, health and accident, disability or other employee
      plans
      in which Executive participated at the time of the Change of Control, or the
      taking of any action that would materially reduce any of such benefits in effect
      at the time of the Change of Control;

    

    then,
      at
      the option of Executive, exercisable by Executive within ninety (90) days of
      the
      occurrence of any of the foregoing events, Executive shall provide notice to
      Bank and Corporation of the existence of one of the above conditions and provide
      Bank and Corporation thirty (30) days in which to cure such condition. In the
      event that Bank and Corporation do not cure the condition within thirty (30)
      days of such notice, Executive may resign from employment by written notice
      (the
“Notice of Termination”) delivered to Bank and Corporation and the provisions of
      Section 6 shall thereupon apply. 

    

    6. PAYMENTS
      UPON TERMINATION. In the event that Executive delivers a Notice of Termination
      to Corporation and Bank (as defined in Section 5 of this Agreement), Executive
      shall, upon entering into a release agreement in favor of Corporation, be
      entitled to receive the compensation and benefits set forth
      below:

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    If,
      at
      the time of termination of Executive’s employment, a “Change of Control” (as
      defined in Section 3 of this Agreement) has also occurred, Bank shall pay
      Executive an amount equal to and no greater than twelve (12) months of the
      Executive’s Agreed Compensation as defined in Section 7, plus any bonus deferred
      or awarded but not yet paid, minus applicable taxes and withholdings, which
      shall be payable over an twelve (12) month period at the same times as salaries
      are payable to employees of the Bank. In addition, for a period of twelve (12)
      months from the date of termination of employment, or until Executive secures
      substantially similar benefits through other employment, whichever shall first
      occur, the Bank shall also maintain in full force and effect, for the continued
      benefit of the Executive, Executive’s health insurance (excluding dental and
      vision insurance) benefits to which the Executive was entitled to participate
      as
      of the date of termination. If Corporation, Bank, or their successor cannot
      provide such benefits under the terms of the plan, Bank, Corporation, or their
      successor shall reimburse Executive in an amount equal to the monthly premium
      paid by him to obtain substantially similar employee benefits which he enjoyed
      prior to termination, which reimbursement shall continue until the expiration
      of
      twelve (12) months from the date of termination of employment or until Executive
      secures substantially similar benefits through other employment, whichever
      shall
      first occur, subject to Code Section 409A if applicable. 

     

    In
      the
      event the payment described herein, when added to all other amounts or benefits
      provided to or on behalf of the Executive in connection with his termination
      of
      employment, would result in the imposition of an excise tax under Code Section
      4999, such payments shall be retroactively (if necessary) reduced to the extent
      necessary to avoid such excise tax imposition. Upon written notice to Executive,
      together with calculations of Corporation’s independent auditors, Executive
      shall remit to Corporation the amount of the reduction plus such interest as
      may
      be necessary to avoid the imposition of such excise tax. Notwithstanding the
      foregoing or any other provision of this contract to the contrary, if any
      portion of the amount herein payable to the Executive is determined to be
      non-deductible pursuant to the regulations promulgated under Section 280G of
      the
      Code, then Corporation shall be required only to pay to Executive the amount
      determined to be deductible under Section 280G.

    

    Notwithstanding
      any other provision, in the event that Executive is determined to be a key
      employee as that term is defined in Section 409A of the Code, no payment that
      is
      determined to be deferred compensation subject to Section 409A of the Code
      shall
      be made until one day following six months from the date of separation of
      service as that term is defined in Section 409A of the Code. 

    

    7.
       DEFINITION
      OF “EXECUTIVE’S AGREED COMPENSATION”. For purposes of this Agreement,
“Executive’s Agreed Compensation” shall be defined as the Executive’s fixed,
      gross, base annual salary then in effect as determined by the Board from time
      to
      time and shall not include any benefits, bonuses, incentives or other
      compensation. 

    

    8. UNAUTHORIZED
      DISCLOSURE. During the term of his employment hereunder, or at any later time,
      the Executive shall not, without the written consent of the Boards of Directors
      of Corporation and Bank or a person authorized thereby, knowingly disclose
      to
      any person, other than a person to whom disclosure is reasonably necessary
      or
      appropriate in connection with the performance by the Executive of his duties
      as
      an executive of Corporation and Bank, any material confidential information
      obtained by him while in the employ of Corporation and Bank with respect to
      any
      of Corporation’s and Bank’s services, products, improvements, formulas, designs
      or styles, processes, customers, methods of business or any business practices
      the disclosure of which could be or will be damaging to Corporation or Bank;
      provided, however, that confidential information shall not include any
      information known generally to the public (other than as a result of
      unauthorized disclosure by the Executive or any person with the assistance,
      consent or direction of the Executive) or any information of a type not
      otherwise considered confidential by persons engaged in the same business or
      a
      business similar to that conducted by Corporation and Bank or any information
      that must be disclosed as required by law.

    

    9. RETURN
      OF
      COMPANY PROPERTY AND DOCUMENTS. The Executive agrees that, at the time of
      termination of his employment, regardless of the reason for termination, he
      will
      deliver to Corporation, Bank and their subsidiaries and affiliates, any and
      all
      company property, including, but not limited to, keys, security codes or passes,
      mobile telephones, records, data, notes, reports, proposals, lists,
      correspondence, specifications, drawings, blueprints, sketches, software
      programs, equipment, other documents or property, or reproductions of any of
      the
      aforementioned items developed or obtained by the Executive during the course
      of
      his employment. 

    

    10. NOTICES.
      Except as otherwise provided in this Agreement, any notice required or permitted
      to be given under this Agreement shall be deemed properly given if in writing
      and if mailed by registered or certified mail, postage prepaid with return
      receipt requested, to Executive’s residence, in the case of notices to
      Executive, and to the principal executive offices of Corporation and Bank,
      in
      the case of notices to Corporation and Bank.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    11. WAIVER.
      No provision of this Agreement may be modified, waived or discharged unless
      such
      waiver, modification or discharge is agreed to in writing and signed by
      Executive and an executive officer specifically designated by the Boards of
      Directors of Corporation and Bank. No waiver by either party hereto at any
      time
      of any breach by the other party hereto of, or compliance with, any condition
      or
      provision of this Agreement to be performed by such other party shall be deemed
      a waiver of similar or dissimilar provisions or conditions at the same or at
      any
      prior or subsequent time. 

    

    12. ASSIGNMENT.
      This Agreement shall not be assignable by any party, except by Corporation
      and
      Bank to any successor in interest to their respective businesses.

    

    13. ENTIRE
      AGREEMENT. This Agreement supersedes any and all agreements, either oral or
      in
      writing, between the parties with respect to the employment of the Executive
      by
      the Bank and/or Corporation and this Agreement contains all the covenants and
      agreements between the parties with respect to employment. 

    

    14. NO
      EMPLOYMENT CONTRACT. This Agreement is not an employment contract. Nothing
      contained herein shall guarantee or assure Executive of continued employment
      by
      Corporation. Rather, Corporation’s and Bank’s obligations to Executive hereunder
      shall arise only if Executive continues to be employed by Corporation and Bank
      in his present or in a higher capacity and, then, only in the event the
      conditions described herein for payment to Executive have been met.

    

    15. SUCCESSORS;
      BINDING AGREEMENT. 

    

    
      	 	
              (a)

            	
              Corporation
                and Bank will require any successor (whether direct or indirect,
                by
                purchase, merger, consolidation, or otherwise) to all or substantially
                all
                of the businesses and/or assets of Corporation and Bank to expressly
                assume and agree to perform this Agreement in the same manner and
                to the
                same extent that Corporation and Bank would be required to perform
                it if
                no such succession had taken place. Failure by Corporation and Bank
                to
                obtain such assumption and agreement prior to the effectiveness of
                any
                such succession shall constitute a breach of this Agreement and the
                provisions of Section 6 of this Agreement shall apply. As used in
                this
                Agreement, “Corporation” and “Bank” shall mean Corporation and Bank, as
                defined previously and any successor to their respective businesses
                and/or
                assets as aforesaid which assumes and agrees to perform this Agreement
                by
                operation of law or otherwise. 

            

    

    

    
      	 	
              (b)

            	
              This
                Agreement shall inure to the benefit of and be enforceable by Executive’s
                personal or legal representatives, executors, administrators, heirs,
                distributees, devisees and legatees. If Executive should die after
                a
                Notice of Termination is delivered by Executive, or following termination
                of Executive’s employment without Cause, and any amounts would be payable
                to Executive under this Agreement if Executive had continued to live,
                all
                such amounts shall be paid in accordance with the terms of this Agreement
                to Executive’s devisee, legatee, or other designee, or, if there is no
                such designee, to Executive’s
                estate.

            

    

    

    16. VALIDITY.
      The invalidity or unenforceability of any provision of this Agreement shall
      not
      affect the validity or enforceability of any other provision of this Agreement,
      which shall remain in full force and effect.

    

    17. APPLICABLE
      LAW. This Agreement shall be governed by and construed in accordance with the
      domestic, internal laws of the Commonwealth of Pennsylvania, without regard
      to
      its conflicts of laws principles. This Agreement shall also be interpreted
      as is
      minimally required to qualify any payment hereunder as not triggering any
      penalty on the Executive or the Corporation or Bank pursuant to Code Section
      409A and the regulations promulgated thereunder.

    

    18. HEADINGS.
      The section headings of this Agreement are for convenience only and shall not
      control or affect the meaning or construction or limit the scope or intent
      of
      any of the provisions of this Agreement.

    

    IN
      WITNESS WHEREOF, the parties have executed this Agreement as of the date first
      above written.

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

    
      	
              ATTEST:

            	 	 	
              UNION
                NATIONAL FINANCIAL CORPORATION

            
	 	 	 	 	 
	  
	 	 	
              By

            	     

	 	 	 	
              Mark
                D. Gainer

            
	 	 	 	
              Chairman,
                President and Chief Executive Officer

            
	 	 	 	 	 
	 	 	 	
              UNION
                NATIONAL COMMUNITY BANK

            
	 	 	 	 	 
	   
	 	 	
              By

            	     

	 	 	 	
              Mark
                D. Gainer

            
	 	 	 	
              Chairman,
                President and Chief Executive Officer

            
	 	 	 	 	 
	
              WITNESS:

            	 	 	
              EXECUTIVE

            
	 	 	 	 	 
	    
	 	  

    

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    EXHIBIT
      10.18

    

    CHANGE
      OF CONTROL AGREEMENT

    

    THIS
      AGREEMENT is made as of the  
      day
      of 
      , 2008,
      between UNION NATIONAL FINANCIAL CORPOATION, a Pennsylvania business corporation
      having a place of business at 570 Lausch Lane, Pennsylvania, 17601
      (“Corporation”), UNION NATIONAL COMMUNITY BANK (“Bank”) a national banking
      association having a place of business at 570 Lausch Lane, Pennsylvania, 17601
      and ____________ (“Executive”), an individual residing in Pennsylvania
      (collectively the “Parties” and, individually, sometimes a
“Party”).

    

    W
      I T N E
      S S E T H:

    

    WHEREAS,
      the Corporation is a registered bank holding company;

    

    WHEREAS,
      the Bank is a subsidiary of the Corporation;

    

    WHEREAS,
      the Executive has been employed by the Bank as ______________________;

    

    WHEREAS,
      this Agreement will become operative only upon a Change of Control (as defined
      herein); and

    

    WHEREAS,
      the purpose of this Agreement is to define certain severance benefits that
      will
      be paid by the Corporation in the event of a Change of Control (as defined
      herein), but is not intended to affect, nor does it affect, the terms of the
      Executive’s employment at will, in the absence of a Change of Control (as
      defined herein) of the Corporation. 

    

    NOW
      THEREFORE, in consideration of the Executive’s service to the Corporation and of
      the mutual covenants, undertakings and agreements set forth herein and intending
      to be legally bound hereby, the Parties agree as follows:

    

    1. TERM.
      The
      term of the Agreement shall be effective as of the day and year written above,
      and shall continue until either Executive or Corporation or Bank gives the
      other
      written notice of termination of employment, with or without cause; provided,
      however, that during the period of time between the execution of an agreement
      to
      effect a Change of Control (as defined herein) and the actual Date of Change
      of
      Control (as defined herein), termination of the Executive’s employment shall
      only be for Cause (as defined herein).

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    2. DEFINITION
      OF CAUSE. The term “Cause” shall be defined, for purposes of this Agreement, as
      the occurrence of one or more of the following:

    

    (i) Executive’s
      willful failure to perform the duties assigned to him, other than a failure
      resulting from Executive’s incapacity because of physical or mental
      illness;

    

    (ii) Executive’s
      failure to follow the good faith lawful instructions of the President and Chief
      Executive Officer of the Corporation or his designee with respect to its
      operations; 

    

    (iii) Executive’s
      willful engagement in misconduct which is materially injurious to the
      Corporation or the Bank;

     

    (iv) Executive’s
      intentional violation of the provisions of this Agreement; 

    

    (v)
       Executive’s
      willful and deliberate violation of any banking law or regulation, or any final
      cease and desist order issued by a bank regulatory authority; 

    

    (vi) Executive’s
      conviction of or entering into a plea of nolo contender to a felony, a crime
      of
      falsehood or to a crime involving moral turpitude;

    

    (vii)
       Executive’s
      suspension, removal, or prohibition from being an institutional-affiliated
      party
      by a final order of an appropriate federal banking agency pursuant to Section
      8(e) or 8(g) of the Federal Deposit Insurance Act or by the Office of the
      Comptroller of the Currency pursuant to federal law; 

    

    (viii) Executive’s
      commission of any act of moral turpitude or other illicit or illegal conduct
      which brings public discredit or results in financial loss to the Corporation
      or
      the Bank;

    

    (ix) Executive’s
      dishonesty or gross negligence in the performance of his duties;

    

    (x) Executive’s
      breach of fiduciary duty involving personal gain; 

    

    (xi) unlawful
      harassment by the Executive against employees, customers, business associates,
      contractors, or vendors of the Corporation or Bank which results or may be
      reasonably expected to result in material liability to the Corporation or
      Bank;

    

    (xii) theft
      or
      abuse by Executive of the Corporation’s or Bank’s property or the property of
      Corporation’s or Bank’s customers, employees, contractors, vendors, or business
      associates; 

    

    (xiii)
       Executive’s
      commission of any act of fraud, misappropriation, or personal dishonesty;

    

    (xiv) insubordination
      as determined by an affirmative vote of seventy-five percent (75%) of the Board
      of Directors of the Corporation or Bank; or

    

    (xv) the
      existence of any material conflict between the interests of the Corporation
      or
      Bank and the Executive that is not disclosed in writing by the Executive to
      the
      Corporation and Bank and approved in writing by the Boards of Directors of
      the
      Corporation and Bank. 

    

    3. DEFINITION
      OF CHANGE OF CONTROL.  As
      used
      in this Agreement, “Change of Control” shall mean: A change of control (other
      than one occurring by reason of an acquisition of the Corporation by Executive)
      wherein the Board of Directors certifies that one of the following has occurred:
      

     

    (a)
      any
“person” or more than one person acting as a group (as such term is defined in
      Section 409A of the Internal Revenue Code of 1986, as amended (“Code”) and any
      Internal Revenue Guidance and regulations under Section 409A of the Code),
      other
      than Bank and Corporation or any “person” who on the date hereof is a director
      or officer of Bank and Corporation, acquires ownership of stock of the
      Corporation together with stock held by such person constituting more than
      fifty
      percent (50%) of the total fair market value or total voting power of the stock
      of the Corporation; or 

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

     

    (b)
      any
“person” or more than one person acting as a group (as such term is defined in
      Section 409A of the Code and any Internal Revenue Guidance and regulations
      under
      Section 409A of the Code), acquires (or has acquired during the 12-month period
      ending on the date of the most recent acquisition by such person or persons)
      ownership of stock of the Corporation possessing thirty-five percent (35%)
      or
      more of the total voting power of the stock of the Corporation; or 

     

    (c)
      during any period of one (1) year during this Agreement, individuals who at
      the
      beginning of such period constitute the Board of Directors of Corporation cease
      for any reason to constitute at least a majority thereof, unless the election
      of
      each director who was not a director at the beginning of such period has been
      approved in advance by directors representing at least two-thirds (2/3) of
      the
      directors then in office who were directors at the beginning of the period.
      

     

    4. DEFINITION
      OF DATE OF CHANGE OF CONTROL. For purposes of this Agreement, the “Date of
      Change of Control” shall mean:  

    

    (a)
       the
      first
      date on which any person or more than one person acting as a group acquire
      ownership of fifty percent (50%) or more of the total fair market value or
      total
      voting power of the stock of the Corporation; 

    

    

    (b) the
      date
      on which any person or more than one person acting as a group acquires ownership
      of stock of the Corporation possessing thirty-five percent (35%) or more of
      the
      total voting power of the stock of the Corporation; 

    

    (c)
       the
      date
      on which individuals who formerly constituted a majority of the Board of
      Directors of the Corporation under Section 3(c) hereof and the replacement
      Director’s otherwise approved under Section 3(c), ceased to be a majority within
      a one year period. 

    

    5. TERMINATION
      OF EMPLOYMENT FOLLOWING A CHANGE OF CONTROL.

    

    If
      a
      Change of Control (as defined in Section 3 of this Agreement) shall occur and
      thereafter, there shall be:

    

    (i) any
      involuntary termination of Executive’s employment (other than for the reasons
      set forth in Section 2 of this Agreement); 

    

    (ii) 
      any
      reassignment of Executive to a location greater than fifty (50) miles from
      the
      location of Executive’s office on the date of the Change of
      Control;

    

    (iii) any
      reduction in Executive’s Annual Base Salary in effect on the date of the Change
      of Control or as the same may be increased from time to time after the Change
      of
      Control; or

    

    (iv) any
      failure to provide Executive with benefits at least as favorable as those
      enjoyed by Executive under any of Corporation’s or Bank’s retirement or pension,
      life insurance, medical, health and accident, disability or other employee
      plans
      in which Executive participated at the time of the Change of Control, or the
      taking of any action that would materially reduce any of such benefits in effect
      at the time of the Change of Control;

    

    then,
      at
      the option of Executive, exercisable by Executive within ninety (90) days of
      the
      occurrence of any of the foregoing events, Executive shall provide notice to
      Bank and Corporation of the existence of one of the above conditions and provide
      Bank and Corporation thirty (30) days in which to cure such condition. In the
      event that Bank and Corporation do not cure the condition within thirty (30)
      days of such notice, Executive may resign from employment by written notice
      (the
“Notice of Termination”) delivered to Bank and Corporation and the provisions of
      Section 6 shall thereupon apply. 

    

    6. PAYMENTS
      UPON TERMINATION. In the event that Executive delivers a Notice of Termination
      to Corporation and Bank (as defined in Section 5 of this Agreement), Executive
      shall, upon entering into a release agreement in favor of Corporation, be
      entitled to receive the compensation and benefits set forth
      below:

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    If,
      at
      the time of termination of Executive’s employment, a “Change of Control” (as
      defined in Section 3 of this Agreement) has also occurred, Bank shall pay
      Executive an amount equal to and no greater than eighteen (18) months of the
      Executive’s Agreed Compensation as defined in Section 7, plus any bonus deferred
      or awarded but not yet paid, minus applicable taxes and withholdings, which
      shall be payable over an eighteen (18) month period at the same times as
      salaries are payable to employees of the Bank. In addition, for a period of
      eighteen (18) months from the date of termination of employment, or until
      Executive secures substantially similar benefits through other employment,
      whichever shall first occur, the Bank shall also maintain in full force and
      effect, for the continued benefit of the Executive, Executive’s health insurance
      (excluding dental and vision insurance) benefits to which the Executive was
      entitled to participate as of the date of termination. If Corporation, Bank,
      or
      their successor cannot provide such benefits under the terms of the plan, Bank,
      Corporation, or their successor shall reimburse Executive in an amount equal
      to
      the monthly premium paid by him to obtain substantially similar employee
      benefits which he enjoyed prior to termination, which reimbursement shall
      continue until the expiration of eighteen (18) months from the date of
      termination of employment or until Executive secures substantially similar
      benefits through other employment, whichever shall first occur, subject to
      Code
      Section 409A if applicable. 

     

    In
      the
      event the payment described herein, when added to all other amounts or benefits
      provided to or on behalf of the Executive in connection with his termination
      of
      employment, would result in the imposition of an excise tax under Code Section
      4999, such payments shall be retroactively (if necessary) reduced to the extent
      necessary to avoid such excise tax imposition. Upon written notice to Executive,
      together with calculations of Corporation’s independent auditors, Executive
      shall remit to Corporation the amount of the reduction plus such interest as
      may
      be necessary to avoid the imposition of such excise tax. Notwithstanding the
      foregoing or any other provision of this contract to the contrary, if any
      portion of the amount herein payable to the Executive is determined to be
      non-deductible pursuant to the regulations promulgated under Section 280G of
      the
      Code, then Corporation shall be required only to pay to Executive the amount
      determined to be deductible under Section 280G.

    

    Notwithstanding
      any other provision, in the event that Executive is determined to be a key
      employee as that term is defined in Section 409A of the Code, no payment that
      is
      determined to be deferred compensation subject to Section 409A of the Code
      shall
      be made until one day following six months from the date of separation of
      service as that term is defined in Section 409A of the Code. 

    

    7.
       DEFINITION
      OF “EXECUTIVE’S AGREED COMPENSATION”. For purposes of this Agreement,
“Executive’s Agreed Compensation” shall be defined as the Executive’s fixed,
      gross, base annual salary then in effect as determined by the Board from time
      to
      time and shall not include any benefits, bonuses, incentives or other
      compensation. 

    

    8. UNAUTHORIZED
      DISCLOSURE. During the term of his employment hereunder, or at any later time,
      the Executive shall not, without the written consent of the Boards of Directors
      of Corporation and Bank or a person authorized thereby, knowingly disclose
      to
      any person, other than a person to whom disclosure is reasonably necessary
      or
      appropriate in connection with the performance by the Executive of his duties
      as
      an executive of Corporation and Bank, any material confidential information
      obtained by him while in the employ of Corporation and Bank with respect to
      any
      of Corporation’s and Bank’s services, products, improvements, formulas, designs
      or styles, processes, customers, methods of business or any business practices
      the disclosure of which could be or will be damaging to Corporation or Bank;
      provided, however, that confidential information shall not include any
      information known generally to the public (other than as a result of
      unauthorized disclosure by the Executive or any person with the assistance,
      consent or direction of the Executive) or any information of a type not
      otherwise considered confidential by persons engaged in the same business or
      a
      business similar to that conducted by Corporation and Bank or any information
      that must be disclosed as required by law.

    

    9. RETURN
      OF
      COMPANY PROPERTY AND DOCUMENTS. The Executive agrees that, at the time of
      termination of his employment, regardless of the reason for termination, he
      will
      deliver to Corporation, Bank and their subsidiaries and affiliates, any and
      all
      company property, including, but not limited to, keys, security codes or passes,
      mobile telephones, records, data, notes, reports, proposals, lists,
      correspondence, specifications, drawings, blueprints, sketches, software
      programs, equipment, other documents or property, or reproductions of any of
      the
      aforementioned items developed or obtained by the Executive during the course
      of
      his employment. 

    

    10. NOTICES.
      Except as otherwise provided in this Agreement, any notice required or permitted
      to be given under this Agreement shall be deemed properly given if in writing
      and if mailed by registered or certified mail, postage prepaid with return
      receipt requested, to Executive’s residence, in the case of notices to
      Executive, and to the principal executive offices of Corporation and Bank,
      in
      the case of notices to Corporation and Bank.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    11. WAIVER.
      No provision of this Agreement may be modified, waived or discharged unless
      such
      waiver, modification or discharge is agreed to in writing and signed by
      Executive and an executive officer specifically designated by the Boards of
      Directors of Corporation and Bank. No waiver by either party hereto at any
      time
      of any breach by the other party hereto of, or compliance with, any condition
      or
      provision of this Agreement to be performed by such other party shall be deemed
      a waiver of similar or dissimilar provisions or conditions at the same or at
      any
      prior or subsequent time. 

    

    12. ASSIGNMENT.
      This Agreement shall not be assignable by any party, except by Corporation
      and
      Bank to any successor in interest to their respective businesses.

    

    13. ENTIRE
      AGREEMENT. This Agreement supersedes any and all agreements, either oral or
      in
      writing, between the parties with respect to the employment of the Executive
      by
      the Bank and/or Corporation and this Agreement contains all the covenants and
      agreements between the parties with respect to employment. 

    

    14. NO
      EMPLOYMENT CONTRACT. This Agreement is not an employment contract. Nothing
      contained herein shall guarantee or assure Executive of continued employment
      by
      Corporation. Rather, Corporation’s and Bank’s obligations to Executive hereunder
      shall arise only if Executive continues to be employed by Corporation and Bank
      in his present or in a higher capacity and, then, only in the event the
      conditions described herein for payment to Executive have been met.

    

    15. SUCCESSORS;
      BINDING AGREEMENT. 

    

    
      	 	
              (a)

            	
              Corporation
                and Bank will require any successor (whether direct or indirect,
                by
                purchase, merger, consolidation, or otherwise) to all or substantially
                all
                of the businesses and/or assets of Corporation and Bank to expressly
                assume and agree to perform this Agreement in the same manner and
                to the
                same extent that Corporation and Bank would be required to perform
                it if
                no such succession had taken place. Failure by Corporation and Bank
                to
                obtain such assumption and agreement prior to the effectiveness of
                any
                such succession shall constitute a breach of this Agreement and the
                provisions of Section 6 of this Agreement shall apply. As used in
                this
                Agreement, “Corporation” and “Bank” shall mean Corporation and Bank, as
                defined previously and any successor to their respective businesses
                and/or
                assets as aforesaid which assumes and agrees to perform this Agreement
                by
                operation of law or otherwise. 

            

    

    

    
      	 	
              (b)

            	
              This
                Agreement shall inure to the benefit of and be enforceable by Executive’s
                personal or legal representatives, executors, administrators, heirs,
                distributees, devisees and legatees. If Executive should die after
                a
                Notice of Termination is delivered by Executive, or following termination
                of Executive’s employment without Cause, and any amounts would be payable
                to Executive under this Agreement if Executive had continued to live,
                all
                such amounts shall be paid in accordance with the terms of this Agreement
                to Executive’s devisee, legatee, or other designee, or, if there is no
                such designee, to Executive’s
                estate.

            

    

    

    16. VALIDITY.
      The invalidity or unenforceability of any provision of this Agreement shall
      not
      affect the validity or enforceability of any other provision of this Agreement,
      which shall remain in full force and effect.

    

    17. APPLICABLE
      LAW. This Agreement shall be governed by and construed in accordance with the
      domestic, internal laws of the Commonwealth of Pennsylvania, without regard
      to
      its conflicts of laws principles. This Agreement shall also be interpreted
      as is
      minimally required to qualify any payment hereunder as not triggering any
      penalty on the Executive or the Corporation or Bank pursuant to Code Section
      409A and the regulations promulgated thereunder.

    

    18. HEADINGS.
      The section headings of this Agreement are for convenience only and shall not
      control or affect the meaning or construction or limit the scope or intent
      of
      any of the provisions of this Agreement.

    

    IN
      WITNESS WHEREOF, the parties have executed this Agreement as of the date first
      above written.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    

    
      	
              ATTEST:

            	 	 	
              UNION
                NATIONAL FINANCIAL CORPORATION

            
	 	 	 	 	 
	     
	 	 	
              By

            	     

	 	 	 	
              Mark
                D. Gainer

            
	 	 	 	
              Chairman,
                President and Chief Executive Officer

            
	 	 	 	 	 
	 	 	 	
              UNION
                NATIONAL COMMUNITY BANK

            
	 	 	 	 	 
	   
	 	 	
              By

            	    

	 	 	 	
              Mark
                D. Gainer

            
	 	 	 	
              Chairman,
                President and Chief Executive Officer

            
	 	 	 	 	 
	
              WITNESS:

            	 	 	
              EXECUTIVE

            
	 	 	 	 
	 	 	 

    

    
      
         

      

      
        12

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00146-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00146-of-00352.parquet"}]]