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Exhibit 4.11  

  
 

    First Amendment and Restatement
  of
  Alliant Techsystems Inc.
  2000 Stock Incentive Plan    
  

Section 1. Purpose.  

    The purpose of the Alliant Techsystems Inc. 2000 Stock Incentive Plan (the "Plan") is to promote the interests of Alliant Techsystems Inc. (the
"Company") and its stockholders by aiding the Company in attracting and retaining employees, consultants and independent contractors, to provide such persons with opportunities for stock ownership in
the Company and to offer such persons other incentives to put forth maximum efforts for the success of the Company's business. 

Section 2. Definitions.  

    As used in the Plan, the following terms shall have the meanings set forth below: 

    (a) "Affiliate"
shall mean (i) any entity that, directly or indirectly through one or more intermediaries, is controlled by the Company and (ii) any
entity in which the Company has a significant equity interest, in each case as determined by the Committee. 

    (b) "Award"
shall mean any Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit or Performance Award granted under the Plan. 

    (c) "Award
Agreement" shall mean any written agreement, contract or other instrument or document evidencing an Award granted under the Plan. Each Award Agreement shall
be subject to the applicable
terms and conditions of the Plan and any other terms and conditions (not inconsistent with the Plan) determined by the Committee. 

    (d) "Board"
shall mean the Board of Directors of the Company. 

    (e) "Code"
shall mean the Internal Revenue Code of 1986, as amended from time to time, and any regulations promulgated thereunder. 

    (f)  "Committee"
shall mean the Personnel and Compensation Committee, a committee of Directors designated by the Board to administer the Plan. 

    (g) "Company"
shall mean Alliant Techsystems Inc., a Delaware corporation, and any successor corporation. 

    (h) "Director"
shall mean a member of the Board. 

    (i)  "Eligible
Person" shall mean any employee, consultant or independent contractor providing services to the Company or any Affiliate whom the Committee determines to
be an Eligible Person, but shall not include (i) an officer or director of the Company or any Affiliate who is subject to Section 16 of the Exchange Act, or any successor rule or
regulation, (ii) any "executive officer" of the Company, as defined under the Exchange Act, or (iii) any other officer or Director of the Company. 

    (j)  "Exchange
Act" shall mean the Securities Exchange Act of 1934, as amended. 

    (k) "Fair
Market Value" shall mean, with respect to any property (including, without limitation, any Shares or other securities), the fair market value of such property
determined by such methods or procedures as shall be established from time to time by the Committee. Notwithstanding the foregoing, the Fair Market Value of Shares as of a given date shall be, if the
Shares are then traded on the New York Stock Exchange, the closing price of the Shares as reported on the New York Stock Exchange on such date or, if the New York Stock Exchange is not open for
trading on such date, on the most recent preceding date when it is open for trading. 

 

    (l)  "Option" shall mean an option granted under Section 6(a) of the Plan that shall not be an incentive stock option within the meaning of Section 422 of
the Code or any successor provision, and shall include Reload Options. 

    (m) "Participant"
shall mean an Eligible Person designated to be granted an Award under the Plan. 

    (n) "Performance
Award" shall mean any right granted under Section 6(d) of the Plan. 

    (o) "Person"
shall mean any individual, corporation, partnership, association or trust. 

    (p) "Plan"
shall mean the Alliant Techsystems Inc. 2000 Stock Incentive Plan, as amended from time to time, the provisions of which are set forth herein. 

    (q) "Reload
Option" shall mean any Option granted under Section 6(a)(iv) of the Plan. 

    (r) "Restricted
Stock" shall mean any Shares granted under Section 6(c) of the Plan. 

    (s) "Restricted
Stock Unit" shall mean any unit granted under Section 6(c) of the Plan evidencing the right to receive a Share (or a cash payment equal to the
Fair Market Value of a Share) at some future date. 

    (t)  "Shares"
shall mean shares of Common Stock, par value $.01 per share, of the Company or such other securities or property as may become subject to Awards pursuant
to an adjustment made under Section 4(c) of the Plan. 

    (u) "Stock
Appreciation Right" shall mean any right granted under Section 6(b) of the Plan. 

Section 3. Administration.  

    (a) Power and Authority of the Committee. The Plan shall be administered by the Committee. Subject to the express
provisions of the Plan and to applicable law, the Committee shall have full power and authority to: 

    (i)  designate
Participants; 

    (ii) determine
the type or types of Awards to be granted to each Participant under the Plan; 

    (iii) determine
the number of Shares to be covered by (or the method by which payments or other rights are to be calculated in connection with) each Award; 

    (iv) determine
the terms and conditions of any Award or Award Agreement; 

    (v) amend
the terms and conditions of any Award or Award Agreement; provided, however, that, except as otherwise provided in Section 4(c) hereof, the Committee
shall not adjust or amend the exercise price of Options or Stock Appreciation Rights previously awarded to any Participant, whether through amendment, cancellation and replacement grant, or any other
means; 

    (vi) accelerate
the exercisability of any Award or the lapse of restrictions relating to any Award; provided, however, that such authority shall be limited to
circumstances involving a change in control of the Company, the sale of an Affiliate or business unit employing the Participant, a Participant's involuntary termination of employment other than for
cause, a Participant's retirement from the Company or an Affiliate, or such other similar events as the Board shall approve; 

    (vii) determine
whether, to what extent and under what circumstances Awards may be exercised in cash, Shares, promissory notes, other securities, other Awards or other
property, or canceled, forfeited or suspended; 

2

 

    (viii) determine whether, to what extent and under what circumstances cash, Shares, promissory notes, other securities, other Awards, other property and other amounts
payable with respect to an Award under the Plan shall be deferred either automatically or at the election of the holder thereof or the Committee; 

    (ix) interpret
and administer the Plan and any instrument or agreement, including an Award Agreement, relating to the Plan; 

    (x) establish,
amend, suspend or waive such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; and 

    (xi) make
any other determination and take any other action that the Committee deems necessary or desirable for the administration of the Plan. 

Unless
otherwise expressly provided in the Plan, all designations, determinations, interpretations and other decisions under or with respect to the Plan or any Award shall be within the sole
discretion of the Committee, may be made at any time and shall be final, conclusive and binding upon any Participant, any holder or beneficiary of any Award and any employee of the Company or any
Affiliate. 

    (b) Delegation. The Committee may delegate its powers and duties under the Plan to one or more Directors or a committee
of Directors, subject to such terms, conditions and limitations as the Committee may establish in its sole discretion. 

    (c) Power and Authority of the Board of Directors. Notwithstanding anything to the contrary contained herein, the Board
may, at any time and from time to time, without any further action of the Committee, exercise the powers and duties of the Committee under the Plan. 

Section 4. Shares Available for Awards.  

    (a) Shares Available. Subject to adjustment as provided in Section 4(c) of the Plan, the aggregate number of
Shares that may be issued under all Awards under the Plan shall be 440,000. Shares to be issued under the Plan may be either authorized but unissued Shares or Shares acquired in the open market or
otherwise. Any Shares that are used by a Participant as full or partial payment to the Company of the purchase price relating to an Award, or in connection with the satisfaction of tax obligations
relating to an Award, shall again be available for granting Awards under the Plan. In addition, if any Shares covered by an Award or to which an Award relates are not purchased or are forfeited, or if
an Award otherwise terminates without delivery of any Shares, then the number of Shares counted against the aggregate number of Shares available under the Plan with respect to such Award, to the
extent of any such forfeiture or termination, shall again be available for granting Awards under the Plan. 

    (b) Accounting for Awards. For purposes of this Section 4, if an Award entitles the holder thereof to receive or
purchase Shares, the number of Shares covered by such Award or to which such Award relates shall be counted on the date of grant of such Award against the aggregate number of Shares available for
granting Awards under the Plan. 

    (c) Adjustments. In the event that the Committee shall determine 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, issuance of warrants or other rights to purchase Shares or other securities of the Company or other similar corporate
transaction or event affects the Shares such that an adjustment is determined by the Committee to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust any or all of (i) the number and type of Shares (or other securities or
other property) that thereafter may be made the subject of Awards, 

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(ii) the number and type of Shares (or other securities or other property) subject to outstanding Awards and (iii) the purchase or exercise price with respect to any Award; provided,
however, that the number of Shares covered by any Award or to which such Award relates shall always be a whole number. 

Section 5. Eligibility.  

    Any Eligible Person shall be eligible to be designated a Participant. In determining which Eligible Persons shall receive an Award and the terms of any Award,
the Committee may take into account the nature of the services rendered by the respective Eligible Persons, their present and potential contributions to the success of the Company or such other
factors as the Committee, in its discretion, shall deem relevant. 

Section 6. Awards.  

    (a) Options. The Committee is hereby authorized to grant Options to Eligible Persons with the following terms and
conditions and with such additional terms and conditions not inconsistent with the provisions of the Plan as the Committee shall determine: 

    (i)  Exercise Price. The purchase price per Share purchasable under an Option shall be determined by the Committee;
provided, however, that such purchase price shall not be less than 100% of the Fair Market Value of a Share on the date of grant of such Option. Notwithstanding the foregoing, the Committee in its
discretion may determine a price per Share of less than Fair Market Value if such grant is in substitution for a stock option granted by an entity merged with or acquired by the Company or an
Affiliate and such grant is made in connection with such merger or acquisition. 

    (ii) Option Term. The term of each Option shall be fixed by the Committee. 

    (iii) Time and Method of Exercise. The Committee shall determine the time or times at which an Option may be exercised
in whole or in part and the method or methods by which, and the form or forms (including, without limitation, cash, Shares, promissory notes, other securities, other Awards or other property, or any
combination thereof, having a Fair Market Value on the exercise date equal to the applicable exercise price) in which, payment of the exercise price with respect thereto may be made or deemed to have
been made. 

    (iv) Reload Options. The Committee may grant Reload Options, separately or together with another Option, pursuant to
which, subject to the terms and conditions established by the Committee, the Participant would be granted a new Option when the payment of the exercise price of a previously granted option is made by
the delivery of Shares owned by the Participant pursuant to Section 6(a)(iii) of the Plan or the relevant provisions of another plan of the Company, and/or when Shares are tendered or
withheld as payment of the amount to be withheld under applicable income tax laws in connection with the exercise of an Option, which new Option would be an Option to purchase the number of Shares not
exceeding the sum of (A) the number of Shares so provided as consideration upon the exercise of the previously granted option to which such Reload Option relates and (B) the number of
Shares, if any, tendered or withheld as payment of the amount to be withheld under applicable tax laws in connection with the exercise of the option to which such Reload Option relates pursuant to the
relevant provisions of the plan or agreement relating to such option. Reload Options may be granted with respect to Options previously granted under the Plan or any other stock option plan of the
Company or may be granted in connection with any Option granted under the Plan or any other stock option plan of the Company at the time of such grant; provided, however, that Reload Options may be
granted only to Eligible Persons. Such Reload Options shall have a per share exercise price equal to the Fair Market Value of one 

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Share as of the date of grant of the new Option. Any Reload Option shall be subject to availability of sufficient Shares for grant under the Plan. 

    (b) Stock Appreciation Rights. The Committee is hereby authorized to grant Stock Appreciation Rights to Eligible Persons
subject to the terms of the Plan and any applicable Award Agreement. A Stock Appreciation Right granted under the Plan shall confer on the holder thereof a right to receive upon exercise thereof the
excess of (i) the Fair Market Value of one Share on the date of exercise (or, if the Committee shall so determine, at any time during a specified period before or after the date of exercise)
over (ii) the grant price of the Stock Appreciation Right as specified by the Committee, which price shall not be less than 100% of the Fair Market Value of one Share on the date of grant of
the Stock Appreciation Right. Subject to the terms of the Plan and any applicable Award Agreement, the grant price, term, methods of exercise, dates of exercise, methods of settlement and any other
terms and conditions of any Stock Appreciation Right shall be as determined by the Committee. The Committee may impose such conditions or restrictions on the exercise of any Stock Appreciation Right
as it may deem appropriate. 

    (c) Restricted Stock and Restricted Stock Units. The Committee is hereby authorized to grant Restricted Stock and
Restricted Stock Units to Eligible Persons with the following terms and conditions and with such additional terms and conditions not inconsistent with the provisions of the Plan as the Committee shall
determine: 

    (i)  Restrictions. Shares of Restricted Stock and Restricted Stock Units shall be subject to such restrictions as the
Committee may impose (including, without limitation, a waiver by the Participant of the right to vote or to receive any dividend or other right or property with respect thereto), which restrictions
may lapse separately or in combination at such time or times, in such installments or otherwise as the Committee may deem appropriate, subject to the limitation that the restrictions on the Restricted
Stock or Restricted Stock Units may not lapse within one year after the date of grant for Awards granted in recognition of past performance and within three years after the date of grant for Awards
granted in all other cases; provided, however, that the Committee may permit installment vesting at a rate of up to one-third of the amount of the Award per year on the first two
anniversary dates of the grant of the Award. 

    (ii) Stock Certificates; Delivery of Shares. Any Restricted Stock granted under the Plan shall be evidenced by issuance
of a stock certificate or certificates, which certificate or certificates shall be held by the Company. Such certificate or certificates shall be registered in the name of the Participant and shall
bear an appropriate legend referring to the restrictions applicable to such Restricted Stock. Stock certificates registered in the name of the Participant shall be delivered to the Participant
promptly after the applicable restrictions lapse or are waived. In the case of Restricted Stock Units, no Shares shall be issued at the time such Awards are granted. Upon the lapse or waiver of
restrictions and the restricted period relating to Restricted Stock Units evidencing the right to receive Shares, such Shares shall be issued and delivered to the holder of the Restricted Stock Units. 

    (iii) Forfeiture. Except as otherwise determined by the Committee, upon a Participant's termination of employment (as
determined under criteria established by the Committee) during the applicable restriction period, all Shares of Restricted Stock and all Restricted Stock Units held by the Participant at such time
shall be forfeited and reacquired by the Company; provided, however, that the Committee may, when it finds that a waiver would be in the best interest of the Company, waive in whole or in
part any or all remaining restrictions with respect to Shares of Restricted Stock or Restricted Stock Units, subject to the provisions of Section 3(a)(vi) of the Plan. 

5

 

    (d) Performance Awards. The Committee is hereby authorized to grant Performance Awards to Eligible Persons subject to
the terms of the Plan and any applicable Award Agreement. A Performance Award granted under the Plan (i) may be denominated or payable in cash, Shares (including, without limitation, Restricted
Stock and Restricted Stock Units), other securities, other Awards or other property and (ii) shall confer on the holder thereof the right to receive payments, in whole or in part, upon the
achievement of such performance goals during such performance periods as the Committee shall establish. Subject to the terms of the Plan and any applicable Award Agreement, the performance goals to be
achieved during any performance period, the length of any performance period, the amount of any Performance Award granted, the amount of any payment or transfer to be made pursuant to any Performance
Award and any other terms and conditions of any Performance Award shall be determined by the Committee. 

    (e) General.

    (i)  No Cash Consideration for Awards. Awards shall be granted for no cash consideration or for such minimal cash
consideration as may be required by applicable law. 

    (ii) Awards May Be Granted Separately or Together. Awards may, in the discretion of the Committee, be granted either
alone or in addition to, in tandem with or in substitution for any other Award or any award granted under any plan of the Company or any Affiliate other than the Plan. Awards granted in addition to or
in tandem with other Awards or in addition to or in tandem with awards granted under any such other plan of the Company or any Affiliate may be granted either at the same time as or at a different
time from the grant of such other Awards or awards. 

    (iii) Forms of Payment under Awards. Subject to the terms of the Plan and any applicable Award Agreement, payments or
transfers to be made by the Company or an Affiliate upon the grant, exercise or payment of an Award may be made in such form or forms as the Committee shall determine (including, without limitation,
cash, Shares, promissory notes, other securities, other Awards or other property, or any combination thereof) and may be made in a single payment or transfer, in installments or on a deferred basis,
in each case in accordance with rules and procedures established by the Committee. Such rules and procedures may include, without limitation, provisions for the payment or crediting of reasonable
interest on installment or deferred payments or the grant or crediting of dividend equivalents with respect to installment or deferred payments. 

    (iv) Limits on Transfer of Awards. No Award and no right under any such Award shall be transferable by a Participant
other than by will or by the laws of descent and distribution; provided, however, that, if so determined by the Committee, a Participant may, in the manner established by the Committee, transfer
Options or designate a beneficiary or beneficiaries to exercise the rights of the Participant and receive any property distributable with respect to any Award upon the death of the Participant. Each
Award or right under any Award shall be exercisable during the Participant's lifetime only by the Participant (except as otherwise provided in an Award Agreement or amendment thereto relating to an
Option pursuant to terms determined by the Committee) or, if permissible under applicable law, by the Participant's guardian or legal representative. No Award or right under any such Award may be
pledged, alienated, attached or otherwise encumbered, and any purported pledge, alienation, attachment or encumbrance thereof shall be void and unenforceable against the Company or any Affiliate. 

    (v) Term of Awards. The term of each Award shall be for such period as may be determined by the Committee. 

    (vi) Restrictions; Securities Exchange Listing. All Shares or other securities delivered under the Plan pursuant to any
Award or the exercise thereof shall be subject to such restrictions as 

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the Committee may deem advisable under the Plan, applicable federal or state securities laws and regulatory requirements, and the Committee may cause appropriate entries to be made or legends to be
placed on the certificates for such Shares or other securities to reflect such restrictions. If the Shares or other securities of the Company are traded on a securities exchange, the Company shall not
be required to deliver any Shares or other securities covered by an Award unless and until such Shares or other securities have been admitted for trading on such securities exchange. 

Section 7. Amendment and Termination; Adjustments.  

    (a) Amendments to the Plan. The Board may amend, alter, suspend, discontinue or terminate the Plan at any time. 

    (b) Amendments to Awards. Subject to the provisions of the Plan, the Committee may waive any conditions of or rights of
the Company under any outstanding Award, prospectively or retroactively. Except as otherwise provided herein or in an Award Agreement, the Committee may not amend, alter, suspend, discontinue or
terminate any outstanding Award, prospectively or retroactively, if such action
would adversely affect the rights of the holder of such Award, without the consent of the Participant or holder or beneficiary thereof. 

    (c) Correction of Defects, Omissions and Inconsistencies. The Committee may correct any defect, supply any omission or
reconcile any inconsistency in the Plan or any Award in the manner and to the extent it shall deem desirable to carry the Plan into effect. 

Section 8. Income Tax Withholding.  

    In order to comply with all applicable federal, state or local income tax laws or regulations, the Company may take such action as it deems appropriate to
ensure that all applicable federal, state or local payroll, withholding, income or other taxes, which are the sole and absolute responsibility of a Participant, are withheld or collected from such
Participant. In order to assist a Participant in paying all or a portion of the federal and state taxes to be withheld or collected upon exercise or receipt of (or the lapse of restrictions relating
to) an Award, the Committee, in its discretion and subject to such additional terms and conditions as it may adopt, may permit the Participant to satisfy such tax obligation by (a) electing to
have the Company withhold a portion of the Shares otherwise to be delivered upon exercise or receipt of (or the lapse of restrictions relating to) such Award with a Fair Market Value equal to the
amount of such taxes or (b) delivering to the Company Shares other than Shares issuable upon exercise or receipt of (or the lapse of restrictions relating to) such Award with a Fair Market
Value equal to the amount of such taxes. The election, if any, must be made on or before the date that the amount of tax to be withheld is determined. 

Section 9. General Provisions.  

    (a) No Rights to Awards. No Eligible Person, Participant or other Person shall have any claim to be granted any Award
under the Plan, and there is no obligation for uniformity of treatment of Eligible Persons, Participants or holders or beneficiaries of Awards under the Plan. The terms and conditions of Awards need
not be the same with respect to any Participant or with respect to different Participants. 

    (b) Award Agreements. No Participant shall have rights under an Award granted to such Participant unless and until an
Award Agreement shall have been duly executed on behalf of the Company and, if requested by the Company, signed by the Participant. 

    (c) No Rights of Stockholders. Except with respect to Restricted Stock, neither a Participant nor the Participant's
legal representative shall be, or have any of the rights and privileges of, a 

7

 

stockholder of the Company with respect to any Shares issuable upon the exercise or payment of any Award, in whole or in part, unless and until the Shares have been issued. 

    (d) No Limit on Other Compensation Plans or Arrangements. Nothing contained in the Plan shall prevent the Company or any
Affiliate from adopting or continuing in effect other or additional compensation plans or arrangements, and such plans or arrangements may be either generally applicable or applicable only in specific
cases. 

    (e) No Right to Employment. The grant of an Award shall not be construed as giving a Participant the right to be
retained in the employ of the Company or any Affiliate, nor will it affect in any way the right of the Company or an Affiliate to terminate such employment at any time, with or without cause. In
addition, the Company or an Affiliate may at any time dismiss a Participant from employment free from any liability or any claim under the Plan or any Award, unless otherwise expressly provided in the
Plan or in any Award Agreement. 

    (f)  Governing Law. The internal law, and not the law of conflicts, of the State of Delaware shall govern all questions
concerning the validity, construction and effect of the Plan or any Award, and any rules and regulations relating to the Plan or any Award. 

    (g) Severability. If any provision of the Plan or any Award is or becomes or is deemed to be invalid, illegal or
unenforceable in any jurisdiction or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to
applicable laws, or if it cannot be so construed or deemed amended without, in the determination of the Committee, materially altering the purpose or intent of the Plan or the Award, such provision
shall be stricken as to such jurisdiction or Award, and the remainder of the Plan or any such Award shall remain in full force and effect. 

    (h) No Trust or Fund Created. Neither the Plan nor any Award shall create or be construed to create a trust or separate
fund of any kind or a fiduciary relationship between the Company or any Affiliate and a Participant or any other Person. To the extent that any Person acquires a right to receive payments from the
Company or any Affiliate pursuant to an Award, such right shall be no greater than the right of any unsecured general creditor of the Company or any Affiliate. 

    (i)  No Fractional Shares. No fractional Shares shall be issued or delivered pursuant to the Plan or any Award, and the
Committee shall determine whether cash shall be paid in lieu of any fractional Share or whether such fractional Share and any rights thereto shall be canceled, terminated or otherwise eliminated. 

    (j)  Headings. Headings are given to the Sections and subsections of the Plan solely as a convenience to facilitate
reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof. 

Section 10. Effective Date of the Plan.  

    The Plan shall be effective as of March 21, 2000. 

Section 11. Term of the Plan.  

    No Award shall be granted under the Plan after January 31, 2002 or any earlier date of discontinuation or termination established pursuant to
Section 7(a) of the Plan. However, unless otherwise expressly provided in the Plan or in an applicable Award Agreement, any Award theretofore granted may extend beyond such date, and the
authority of the Committee provided for hereunder with respect to the Plan and any Awards, and the authority of the Board of Directors of the Company to amend the Plan, shall extend beyond that date. 

8

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First Amendment and Restatement of Alliant Techsystems Inc. 2000 Stock Incentive PlanPrepared by MERRILL CORPORATION

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Exhibit 10.1  

 
 

IMMUNE RESPONSE CORPORATION
  
    1989 STOCK INCENTIVE PLAN
  
    AS AMENDED AND RESTATED EFFECTIVE MARCH 8, 2001    
  

 
 
 

TABLE OF CONTENTS    
  

	 
	 	 
	 	Page

	SECTION 1.	 	ESTABLISHMENT AND PURPOSE.	 	1
	

SECTION 2.	
 	

DEFINITIONS.	
 	

1
	(a)	 	"Board of Directors"	 	1
	(b)	 	"Change in Control"	 	1
	(c)	 	"Code"	 	1
	(d)	 	"Consultant"	 	2
	(e)	 	"Committee"	 	2
	(f)	 	"Company"	 	2
	(g)	 	"Employee"	 	2
	(h)	 	"Exchange Act"	 	2
	(i)	 	"Exercise Price"	 	2
	(j)	 	"Fair Market Value"	 	2
	(k)	 	"ISO"	 	2
	(l)	 	"Nonstatutory Option"	 	2
	(m)	 	"Offeree"	 	2
	(n)	 	"Option"	 	2
	(o)	 	"Optionee"	 	2
	(p)	 	"Outside Director"	 	2
	(q)	 	"Plan"	 	2
	(r)	 	"Purchase Price"	 	3
	(s)	 	"Service"	 	3
	(t)	 	"Share"	 	3
	(u)	 	"Stock"	 	3
	(v)	 	"Stock Option Agreement"	 	3
	(w)	 	"Stock Purchase Agreement"	 	3
	(x)	 	"Subsidiary"	 	3
	(y)	 	"Total and Permanent Disability"	 	3
	

SECTION 3.	
 	

ADMINISTRATION.	
 	

3
	(a)	 	Committee Membership	 	3
	(b)	 	Disinterested Directors	 	3
	(c)	 	Committee Procedures	 	3
	(d)	 	Committee Responsibilities	 	5
	

SECTION 4.	
 	

ELIGIBILITY.	
 	

4
	(a)	 	General Rule	 	4
	(b)	 	Outside Directors	 	4
	(c)	 	Ten-Percent Stockholders	 	5
	(d)	 	Attribution Rules	 	5
	(e)	 	Outstanding Stock	 	5
	

SECTION 5.	
 	

STOCK SUBJECT TO PLAN.	
 	

5
	(a)	 	Basic Limitation	 	5
	(b)	 	Additional Shares	 	5
	

SECTION 6.	
 	

TERMS AND CONDITIONS OF AWARDS OR SALES.	
 	

6
	(a)	 	Stock Purchase Agreement	 	6
	(b)	 	Duration of Offers and Nontransferability of Rights	 	6
	(c)	 	Purchase Price	 	6

i

 

	(d)	 	Withholding Taxes	 	6
	(e)	 	Restrictions on Transfer of Shares	 	6
	

SECTION 7.	
 	

TERMS AND CONDITIONS OF OPTIONS.	
 	

6
	(a)	 	Stock Option Agreement	 	6
	(b)	 	Number of Shares	 	6
	(c)	 	Exercise Price	 	6
	(d)	 	Withholding Taxes	 	6
	(e)	 	Exercisability and Term	 	7
	(f)	 	Nontransferability	 	7
	(g)	 	Termination of Service (Except by Death)	 	7
	(h)	 	Leaves of Absence	 	7
	(i)	 	Death of Optionee	 	7
	(j)	 	No Rights as a Stockholder	 	8
	(k)	 	Modification, Extension and Renewal of Options	 	8
	(l)	 	Restrictions on Transfer of Shares	 	8
	

SECTION 8.	
 	

PAYMENT FOR SHARES.	
 	

8
	(a)	 	General Rule	 	8
	(b)	 	Surrender of Stock	 	8
	(c)	 	Exercise/Sale	 	8
	(d)	 	Exercise/Pledge	 	9
	(e)	 	Services Rendered	 	9
	(f)	 	Promissory Note	 	9
	(g)	 	Surrender of Option	 	9
	

SECTION 9.	
 	

ADJUSTMENT OF SHARES.	
 	

9
	(a)	 	General	 	9
	(b)	 	Reorganizations	 	9
	(c)	 	Reservation of Rights	 	9
	

SECTION 10.	
 	

SECURITIES LAWS.	
 	

10
	

SECTION 11.	
 	

NO EMPLOYMENT RIGHTS.	
 	

10
	

SECTION 12.	
 	

DURATION AND AMENDMENTS.	
 	

10
	(a)	 	Term of the Plan	 	10
	(b)	 	Applicability of 1990 Directors' Plan	 	10
	(c)	 	Right to Amend or Terminate the Plan	 	10
	(d)	 	Effect of Amendment or Termination	 	10
	

SECTION 13.	
 	

EXECUTION.	
 	

11

ii

 
 
 

1989 STOCK PLAN OF
  
    THE IMMUNE RESPONSE CORPORATION
  
    (As Amended and Restated Effective March 8, 2001)    
  

SECTION 1. ESTABLISHMENT AND PURPOSE.  

    The 1989 Stock Plan of The Immune Response Corporation (the "Plan") was established in 1989 to offer selected employees, directors, advisers and consultants an
opportunity to acquire a proprietary interest in the success of the Company, or to increase such interest, by purchasing Shares of the Company's Common Stock. The Plan was amended and restated on
March 10, 1999 and was subsequently amended and restated on March 8, 2001. 

    The
1990 Directors' Stock Option Plan of The Immune Response Corporation ("Directors' Plan") was established in 1990 to offer Outside Directors an opportunity to acquire a proprietary
interest in the success of the Company or to increase such interest, by purchasing Shares of the Company's Stock. The Directors' Plan was amended effective December 15, 1992, and again on
September 19, 1994. 

    On
November 14, 2000, the Board of Directors approved the consolidation of the Plan with the Directors' Plan, effective as of November 14, 2000 and to allow Outside
Directors to elect to receive options in lieu of fees for the years 2000 through 2002. Any Shares not subject to exercise under the Directors' Plan or which are not exercised because of forfeiture or
termination of options granted under the Directors' Plan are added to this Plan. 

    The
Plan provides both for the direct award or sale of Shares and for the grant of Options to purchase Shares. Options granted under the Plan may include Nonstatutory Options as well
as ISOs intended to qualify under section 422 of the Code. The Plan is intended to comply in all respects with Rule 16b-3 (or its successor) under the Exchange Act. 

SECTION 2. DEFINITIONS.  

    (a) "Board of Directors"  shall mean the Board of Directors of the Company, as constituted from time to time. 

    (b)
"Change in Control" shall mean any of the following events: 

    (1) a
change in the composition of the Board of Directors that occurs as a result of which fewer than two-thirds of the incumbent directors are directors
("Continuing Directors") who either had been directors of the Company 24 months prior to such change, or were elected or nominated for election to the Board with the approval of at least a
majority of the directors who had been directors of the Company 24 months prior to such change and who were still in office at the time of the election or nomination; 

    (2) any
person is or becomes the beneficial owner (directly or indirectly) of at least 25% of the combined voting power of the Company's outstanding securities, and
such ownership has not been approved by a majority of the Continuing Directors; or 

    (3) any
person is or becomes the beneficial owner (directly or indirectly) of at least 50% of the combined voting power of the Company's outstanding securities. 

    For
purposes of paragraphs (2) and (3), a change in the relative beneficial ownership by reason of the Company's repurchase of its own securities will be disregarded. 

    (c) "Code" shall mean the Internal Revenue Code of 1986, as amended. 

1

 

    (d) "Consultant" shall mean an independent contractor or advisor who performs services for the Company or a Subsidiary
(other than a member of the Board of Directors of the Company or a Subsidiary). 

    (e) "Committee" shall mean a committee of the Board of Directors, as described in Section 3(a). 

    (f)  "Company"  shall mean The Immune Response Corporation, a Delaware corporation. 

    (g) "Employee"  shall mean any individual who is a common-law employee of the Company or a Subsidiary. 

    (h) "Exchange Act"  shall mean the Securities Exchange Act of 1934, as amended. 

    (i)  "Exercise Price"  shall mean the amount for which one Share may be purchased upon exercise of an Option, as
specified by the Committee in the applicable Stock Option Agreement. 

    (j)  "Fair Market Value"shall mean the market price of Stock, determined by the Committee as follows: 

     (i) If
Stock was traded on a stock exchange on the date in question, then the Fair Market Value shall be equal to the closing price reported for such date by the
applicable composite-transactions report; 

    (ii) If
Stock was traded over-the-counter on the date in question and was traded on the Nasdaq system or the Nasdaq National Market, then the
Fair Market Value shall be equal to the last-transaction price quoted for such date by the Nasdaq system or the Nasdaq National Market; 

    (iii) If
Stock was traded over-the-counter on the date in question but was not traded on the Nasdaq system or the Nasdaq National Market, then
the Fair Market Value shall be equal to the mean between the last reported representative bid and asked prices quoted for such date by the principal automated inter-dealer quotation system on which
Stock is quoted or, if the Stock is not quoted on any such system, by the "Pink Sheets" published by the National Quotation Bureau, Inc.; and 

    (iv) If
none of the foregoing provisions is applicable, then the Fair Market Value shall be determined by the Committee in good faith on such basis as it deems
appropriate. 

    In
all cases, the determination of Fair Market Value by the Committee shall be conclusive and binding on all persons. 

    (k) "ISO"  shall mean an employee incentive stock option described in section 422(b) of the Code. 

    (l)  "Nonstatutory Option"  shall mean an employee stock option not described in sections 422 or 423 of the Code. 

    (m) "Offeree"  shall mean an individual to whom the Committee has offered the right to acquire Shares under the Plan
(other than upon exercise of an Option). 

    (n) "Option"  shall mean an ISO or Nonstatutory Option granted under the Plan and entitling the holder to purchase
Shares. 

    (o) "Optionee"  shall mean an individual who holds an Option. 

    (p) "Outside Director"  shall mean a member of the Board of Directors of the Company or of a Subsidiary who is not an
Employee. 

    (q) "Plan"  shall mean this Amended and Restated 1989 Stock Plan of The Immune Response Corporation. 

2

 

    (r) "Purchase Price"  shall mean the consideration for which one Share may be acquired under the Plan (other than upon
exercise of an Option), as specified by the Committee. 

    (s) "Service"  shall mean service as an Employee, Outside Director or Consultant. 

    (t)  "Share"  shall mean one share of Stock, as adjusted in accordance with Section 10 (if applicable). 

    (u) "Stock"  shall mean the Common Stock of the Company. 

    (v) "Stock Option Agreement"  shall mean the agreement between the Company and an Optionee which contains the terms,
conditions and restrictions pertaining to his or her Option. 

    (w) "Stock Purchase Agreement"  shall mean the agreement between the Company and an Offeree who acquires Shares under
the Plan which contains the terms, conditions and restrictions pertaining to the acquisition of such Shares. 

    (x) "Subsidiary"  shall mean any corporation, if the Company and/or one or more other Subsidiaries own not less than
50 percent of the total combined voting power of all classes of outstanding stock of
such corporation. A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan shall be considered a Subsidiary commencing as of such date. 

    (y) "Total and Permanent Disability"  shall mean that the Optionee is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted, or can be expected to last, for a continuous period of not
less than one year. 

SECTION 3. ADMINISTRATION.  

    (a) Committee Membership. The Plan shall be administered by the Committee. The Committee shall consist of two or more
disinterested members of the Board of Directors and shall meet such other requirements as may be established from time to time by the Securities and Exchange Commission for plans intended to qualify
for exemption under Rule 16b-3 (or its successor) under the Exchange Act. The Committee may delegate its functions to one or more members of the Board of Directors, who need not be
disinterested directors, to administer the Plan with respect to Employees who are not officers or directors of the Company, and such delegated member of the Board of Directors may grant Shares and
Options under the Plan to those Employees who are not officers or directors of the Company, and may determine the timing, number of Shares and other terms of such grants in a manner not inconsistent
with the terms of this Plan. 

    (b) Disinterested Directors. A member of the Board of Directors shall be deemed "disinterested" only if he or she
satisfies (i) such requirements as the Securities and Exchange Commission may establish for disinterested administrators of plans designed to qualify for exemption under
Rule 16b-3 (or its successor) under the Exchange Act and (ii) such requirements as the Internal Revenue Service may establish for outside directors acting under plans
intended to qualify for exemption under section 162(m)(4)(C) of the Code. 

    (c) Committee Procedures. The Board of Directors shall designate one of the members of the Committee as chairman. The
Committee may hold meetings at such times and places as it shall determine. The acts of a majority of the Committee members present at meetings at which a quorum exists, or acts reduced to or approved
in writing by all Committee members, shall be valid acts of the Committee. 

3

 

    (d) Committee Responsibilities. Subject to the provisions of the Plan, the Committee shall have full authority and
discretion to take the following actions: 

     (i) To
interpret the Plan and to apply its provisions; 

    (ii) To
adopt, amend or rescind rules, procedures and forms relating to the Plan; 

    (iii) To
authorize any person to execute, on behalf of the Company, any instrument required to carry out the purposes of the Plan; 

    (iv) To
determine when Shares are to be awarded or offered for sale and when Options are to be granted under the Plan; 

    (v) To
select the Offerees and Optionees, except as otherwise provided in Section 9; 

    (vi) To
determine the number of Shares to be offered to each Offeree or to be made subject to each Option, except as otherwise provided in Section 9; 

   (vii) To
prescribe the terms and conditions of each award or sale of Shares, including (without limitation) the Purchase Price, and to specify the provisions of the
Stock Purchase Agreement relating to such award or sale; 

   (viii) To
prescribe the terms and conditions of each Option, including (without limitation) the Exercise Price, to determine whether such Option is to be classified as
an ISO or as a Nonstatutory Option, and to specify the provisions of the Stock Option Agreement relating to such Option; 

    (ix) To
amend any outstanding Stock Purchase Agreement or Stock Option Agreement, subject to applicable legal restrictions and to the consent of the Offeree or Optionee
who entered into such agreement; 

    (x) To
prescribe the consideration for the grant of each Option or other right under the Plan and to determine the sufficiency of such consideration; and 

    (xi) To
take any other actions deemed necessary or advisable for the administration of the Plan. 

All
decisions, interpretations and other actions of the Committee shall be final and binding on all Offerees, all Optionees, and all persons deriving their rights from an Offeree or Optionee. No
member of the Committee shall be liable for any action that he or she has taken or has failed to take in good faith with respect to the Plan, any Option, or any right to acquire Shares under the Plan. 

SECTION 4. ELIGIBILITY.  

    (a) General Rule. Only Employees, Consultants and Outside Directors shall be eligible for designation as Optionees or
Offerees by the Committee, provided that only Employees of the Company or a Subsidiary shall be eligible for the grant of ISOs. 

    (b) Outside Directors. The following provisions shall apply only to Outside Directors: 

     (i) Automatic
Grant. Each Outside Director shall automatically be granted a Nonstatutory Option to purchase twenty-five thousand (25,000) Shares (subject to
adjustment under Section 9) as a result of his or her appointment as an Outside Director, which Options shall vest and become exercisable as to twenty-five percent of the Shares
covered by the Option on each of the next four anniversaries of the date of grant. In addition, upon the conclusion of each regular annual meeting of the Company's stockholders following the meeting
at which they were appointed, each Outside Director who will continue serving as a member of the Board thereafter shall receive a Nonstatutory Option to purchase six thousand two hundred fifty (6,250)
Shares (subject to 

4

 

adjustment under Section 9), which Option shall vest and become exercisable in full on the first anniversary of the date of grant. In addition, each Option granted hereunder shall become
exercisable in full in the event that the service of the Outside Director holding the Option terminates at least six months after the date of grant of the Option by reason of death, Total and
Permanent Disability, retirement after attaining age 65, or in the event of a Change in Control. 

    (ii) Election
to Receive Nonstatutory Options in Lieu of Directors' Fees. An Outside Director may make a one-time election to receive his or her annual
retainer payments and/or meeting fees from the Company for the period January 1, 2000 - December 31, 2002 in the form of Nonstatutory Stock Options
in lieu of cash. The number of Shares subject to Options granted under this Section 4(b)(ii) shall be determined by dividing the amount of directors' fees for such three-year
period, including monthly fees, regular meeting fees, and applicable Board of Directors committee meeting fees, by the closing price of the Company's Stock on November 14, 2000, and multiplying
the result by four. The Option granted pursuant to this Section 4(b)(ii) shall vest pro rata daily over the three-year period commencing January 1, 2000. 

    (iii) The
Exercise Price of all Nonstatutory Options granted to an Outside Director under this Section 4(b) shall be equal to one hundred percent (100%) of the
Fair Market Value of a Share on the date of grant. The Exercise Price shall be payable in one of the forms described in Section 8. 

    (iv) All
Nonstatutory Options granted to an Outside Director under this Section 4(b) shall terminate in accordance with Sections 7(g) and (i). 

    (c) Ten-Percent Stockholders. An Employee who owns more than 10 percent of the total combined voting
power of all classes of outstanding stock of the Company or any of its Subsidiaries shall not be eligible for the grant of an ISO unless (i) the Exercise Price is at least 110 percent of
the Fair Market Value of a Share on the date of grant and (ii) such ISO by its terms is not exercisable after the expiration of five years from the date of grant. 

    (d) Attribution Rules. For purposes of Subsection (c) above, in determining stock ownership, an Employee shall be
deemed to own the stock owned, directly or indirectly, by or for his or her brothers, sisters, spouse, ancestors and lineal descendants. Stock owned, directly or indirectly, by or for a corporation,
partnership, estate or trust shall be deemed to be owned proportionately by or for its shareholders, partners or beneficiaries. Stock with respect to which such Employee holds an option shall not be
counted. 

    (e) Outstanding Stock. For purposes of Subsection (c) above, "outstanding stock" shall include all stock actually
issued and outstanding immediately after the grant. "Outstanding stock" shall include shares authorized for issuance under outstanding options held by the Employee or by any other person to the extent
required by law. 

SECTION 5. STOCK SUBJECT TO PLAN.  

    (a) Basic Limitation. Shares offered under the Plan shall be authorized but unissued Shares or treasury Shares. The
aggregate number of Shares which may be issued under the Plan (upon exercise of Options or other rights to acquire Shares) shall not exceed 9,900,000 Shares, including Shares from Directors'
Plan, transferred subject to adjustment pursuant to Section 9. The number of Shares that are subject to Options or other rights outstanding at any time under the Plan shall not exceed the
number of Shares that then remain available for issuance under the Plan. The Company, during the term of the Plan, shall at all times reserve and keep available sufficient Shares to satisfy the
requirements of the Plan. 

    (b) Additional Shares. In the event that any outstanding Option or other right for any reason expires or is canceled or
otherwise terminated, including Options granted under the Director's Plan, the Shares allocable to the unexercised portion of such Option or other right shall again be available for 

5

 

the purposes of the Plan. In the event that Shares issued under the Plan are reacquired by the Company pursuant to a forfeiture provision, a right of repurchase or a right of first refusal, such
Shares shall again be available for the purposes of the Plan. 

SECTION 6. TERMS AND CONDITIONS OF AWARDS OR SALES.  

    (a) Stock Purchase Agreement. Each award or sale of Shares under the Plan (other than upon exercise of an Option) shall
be evidenced by a Stock Purchase Agreement between the Offeree and the Company. Such award or sale shall be subject to all applicable terms and conditions of the Plan and may be subject to any other
terms and conditions which are not inconsistent with the Plan and which the Committee deems appropriate for inclusion in a Stock Purchase Agreement. The provisions of the various Stock Purchase
Agreements entered into under the Plan need not be identical. 

    (b) Duration of Offers and Nontransferability of Rights. Any right to acquire Shares under the Plan (other than an
Option) shall automatically expire if not exercised by the Offeree within thirty (30) days after the grant of such right was communicated to him or her by the Committee. Such right shall not be
transferable and shall be exercisable only by the Offeree to whom such right was granted. 

    (c) Purchase Price. The Purchase Price of Shares to be offered under the Plan shall not be less than 85 percent
of the Fair Market Value of such Shares. Subject to the preceding sentence, the Purchase Price shall be determined by the Committee at its sole discretion. The Purchase Price shall be payable in a
form described in Section 8. 

    (d) Withholding Taxes. As a condition to the purchase of Shares, the Offeree shall make such arrangements as the
Committee may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with such purchase. 

    (e) Restrictions on Transfer of Shares. Any Shares awarded or sold under the Plan shall be subject to such special
forfeiture conditions, rights of repurchase, rights of first refusal and other transfer restrictions as the Committee may determine. Such restrictions shall be set forth in the applicable Stock
Purchase Agreement and shall apply in addition to any general restrictions that may apply to all holders of Shares. 

SECTION 7. TERMS AND CONDITIONS OF OPTIONS.  

    (a) Stock Option Agreement. Each grant of an Option under the Plan shall be evidenced by a Stock Option Agreement
between the Optionee and the Company. Such Option shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions which are not inconsistent
with the Plan and which the Committee deems appropriate for inclusion in a Stock Option Agreement. The provisions of the various Stock Option Agreements entered into under the Plan need not be
identical. 

    (b) Number of Shares. Each Stock Option Agreement shall specify the number of Shares that are subject to the Option and
shall provide for the adjustment of such number in accordance with Section 9. Options granted to any Optionee in a single calendar year shall in no event cover more than 500,000 Shares, subject
to adjustment in accordance with Section 9. The Stock Option Agreement shall also specify whether the Option is an ISO or a Nonstatutory Option. 

    (c) Exercise Price. Each Stock Option Agreement shall specify the Exercise Price. The Exercise Price of an ISO shall not
be less than 100 percent of the Fair Market Value of a Share on the date of grant, except as otherwise provided in Section 4(c). The Exercise Price of a Nonstatutory Option shall not be
less than 85 percent of the Fair Market Value of a Share on the date of grant. Subject to the preceding two sentences, the Exercise Price under any Option shall be determined by the Committee
at its sole discretion. The Exercise Price shall be payable in a form described in Section 8. 

6

 

    (d) Withholding Taxes. As a condition to the exercise of an Option, the Optionee shall make such arrangements as the
Committee may require for the satisfaction of any federal, state, local or foreign
withholding tax obligations that may arise in connection with such exercise. The Optionee shall also make such arrangements as the Committee may require for the satisfaction of any federal, state,
local or foreign withholding tax obligations that may arise in connection with the disposition of Shares acquired by exercising an Option. 

    (e) Exercisability and Term. Each Stock Option Agreement shall specify the date when all or any installment of the
Option is to become exercisable. Except as otherwise provided in Section 4(b), the vesting of any Option shall be determined by the Committee at its sole discretion. A Stock Option Agreement
may provide for accelerated exercisability in the event of the Optionee's death, Total and Permanent Disability, retirement or other events. The Stock Option Agreement shall also specify the term of
the Option. The term shall not exceed 10 years from the date of grant, except as otherwise provided in Section 4(b) and (c). Subject to the preceding sentence, the Committee at its sole
discretion shall determine when an Option is to expire. 

    (f)  Nontransferability. During an Optionee's lifetime, his or her Option(s) shall be exercisable only by him or her and
shall not be transferable. In the event of an Optionee's death, his or her Option(s) shall not be transferable other than by will, by a beneficiary designation executed by the Optionee and delivered
to the Company, or by the laws of descent and distribution. 

    (g) Termination of Service (Except by Death). If an Optionee's Service terminates for any reason other than his or her
death, then his or her Option(s) shall expire on the earliest of the following occasions: 

     (i) The
expiration date determined pursuant to Subsection (e) above; 

    (ii) The
date 90 days after the termination of his or her Service for any reason other than Total and Permanent Disability; or 

    (iii) The
date six months after the termination of his or her Service by reason of Total and Permanent Disability. 

The
Optionee may exercise all or part of his or her Option(s) at any time before the expiration of such Option(s) under the preceding sentence, but only to the extent that such Option(s) had become
exercisable before his or her Service terminated or became exercisable as a result of the termination. The balance of such Option(s) shall lapse when the Optionee's Service terminates. In the event
that the Optionee dies after the termination of his or her Service but before the expiration of his or her Option(s), all or part of such Option(s) may be exercised (prior to expiration) by the
executors or administrators of the Optionee's estate or by any person who has acquired such Option(s) directly from him or her by bequest, beneficiary designation or inheritance, but only to the
extent that such Option(s) had become exercisable before his or her Service terminated or became exercisable as a result of the termination. 

    (h) Leaves of Absence. For purposes of Subsection (g) above, Service shall be deemed to continue while the
Optionee is on military leave, sick leave or other bona fide leave of absence (as determined by the Committee). The foregoing notwithstanding, in the case of an ISO granted under the Plan, Service
shall not be deemed to continue beyond the first 90 days of such leave, unless the Optionee's reemployment rights are guaranteed by statute or by contract. 

    (i)  Death of Optionee. If an Optionee dies while he or she is in Service, then his or her Option(s) shall expire on the
earlier of the following dates: 

     (i) The
expiration date determined pursuant to Subsection (e) above; or 

    (ii) The
date six months after his or her death. 

7

 

All
or part of the Optionee's Option(s) may be exercised at any time before the expiration of such Option(s) under the preceding sentence by the executors or administrators of his or her estate or by
any person who has acquired such Option(s) directly from him or her by bequest, beneficiary designation or inheritance, but only to the extent that such Option(s) had become exercisable before his or
her death or became exercisable as a result of his or her death. The balance of such Option(s) shall lapse when the Optionee dies. 

    (j)  No Rights as a Stockholder. An Optionee, or a transferee of an Optionee, shall have no rights as a stockholder with
respect to any Shares covered by his or her Option until the date of the issuance of a stock certificate for such Shares. No adjustments shall be made, except as provided in Section 9. 

    (k) Modification, Extension and Renewal of Options. Within the limitations of the Plan, the Committee may modify, extend
or renew outstanding Options or may accept the cancellation of outstanding Options (to the extent not previously exercised) in return for the grant of new Options at the same or a different price. The
foregoing notwithstanding, no modification of an Option shall, without the consent of the Optionee, impair his or her rights or increase his or her obligations under such Option. 

    (l)  Restrictions on Transfer of Shares. Any Shares issued upon exercise of an Option shall be subject to such special
forfeiture conditions, rights of repurchase, rights of first refusal and other transfer restrictions as the Committee may determine. Such restrictions shall be set forth in the applicable Stock
Option Agreement and shall apply in addition to any general restrictions that may apply to all holders of Shares. 

SECTION 8. PAYMENT FOR SHARES.  

    (a) General Rule. The entire Purchase Price or Exercise Price of Shares issued under the Plan shall be payable in lawful
money of the United States of America at the time when such Shares are purchased, except as follows: 

     (i) In
the case of Shares sold under the terms of a Stock Purchase Agreement subject to the Plan, payment shall be made only pursuant to the express provisions of such
Stock Purchase Agreement. However, the Committee (at its sole discretion) may specify in the Stock Purchase Agreement that payment may be made in one or both of the forms described in Subsections
(e) and (f) below. 

    (ii) In
the case of an ISO granted under the Plan, payment shall be made only pursuant to the express provisions of the applicable Stock Option Agreement. However, the
Committee (at its sole discretion) may specify in the Stock Option Agreement that payment may be made pursuant to Subsections (b), (c), (d) or (f) below. 

    (iii) In
the case of a Nonstatutory Option granted under the Plan to an Employee or a Consultant or, other than an Option granted under Section 4(b), to an
Outside Director, the Committee (at its sole discretion) may accept payment in one or more of the forms described in Subsections (b), (c), (d), or (f) below. 

    (iv) In
the case of a Nonstatutory Option granted under the Plan to an Outside Director under Section 4(b), payment may be made in one or more of the forms
described in Subsections (b), (c), (d), or (g) below. 

    (b) Surrender of Stock. To the extent that this Subsection (b) is applicable, payment may be made all or in part
with Shares which have already been owned by the Optionee or his or her representative for more than six months and which are surrendered to the Company in good form for transfer. Such Shares shall be
valued at their Fair Market Value on the date when the new Shares are purchased under the Plan. 

8

 

    (c) Exercise/Sale. To the extent that this Subsection (c) is applicable, payment may be made by the delivery (on
a form prescribed by the Company) of an irrevocable direction to a securities broker approved by the Company to sell Common Shares and to deliver all or part of the sales proceeds to the Company in
payment of all or part of the Exercise Price and any withholding taxes. 

    (d) Exercise/Pledge. To the extent that this Subsection (d) is applicable, payment may be made by the delivery
(on a form prescribed by the Company) of an irrevocable direction to pledge Common Shares to a securities broker or lender approved by the Company, as security for a loan and to deliver all or part of
the loan proceeds to the Company in payment of all or part of the Exercise Price and any withholding taxes. 

    (e) Services Rendered. To the extent that this Subsection (e) is applicable, Shares may be awarded under the Plan
in consideration of services rendered to the Company or a Subsidiary prior to the award. If Shares are awarded without the payment of a Purchase Price in cash, the Committee shall make a determination
(at the time of the award) of the value of the services rendered by the Offeree and the sufficiency of the consideration to meet the requirements of Section 6(c). 

    (f)  Promissory Note. To the extent that this Subsection (f) is applicable, a portion of the Purchase Price or
Exercise Price, as the case may be, of Shares issued under the Plan may be payable by a full-recourse promissory note, provided that (i) the par value of such Shares must be paid in
lawful money of the United States of America at the time when such Shares are purchased, (ii) the Shares are security for payment of the principal amount of the promissory note and interest
thereon, and (iii) the interest rate payable under the terms of the promissory note shall be no less than the minimum rate (if any) required to avoid the imputation of additional interest under
the Code. Subject to the foregoing, the Committee (at its sole discretion) shall specify the term, interest rate, amortization requirements (if any), and other provisions of such note. 

    (g) Surrender of Option. To the extent that this Subsection (g) is applicable, the Optionee may elect to have all
or any part of an exercisable Option settled by receiving Shares in exchange for surrendering all or the appropriate part of that Option. The aggregate Fair Market Value of the Shares received by the
Optionee (as of the date of exercise) shall be equal to the difference between the Exercise Price of the Option and the Fair Market Value of the Shares as to which the Option is exercised. Shares as
to which Options have been settled under this Subsection (g) shall not be available for further Option grants under the Plan. 

SECTION 9. ADJUSTMENT OF SHARES.  

    (a) General. In the event of a subdivision of the outstanding Stock, a declaration of a dividend payable in Shares, a
declaration of a dividend payable in a form other than Shares in an amount that has a material effect on the value of Shares, a combination or consolidation of the outstanding Stock (by
reclassification or otherwise) into a lesser number of Shares, a recapitalization or a similar occurrence, the Committee shall make appropriate adjustments in one or more of (i) the number of
Shares available for future grants under Section 5, (ii) the limit set forth in Section 7(b), (ii) the number of Shares covered by each outstanding Option, or
(iii) the Exercise Price under each outstanding Option. 

    (b) Reorganizations. In the event that the Company is a party to a merger or other reorganization, outstanding Options
shall be subject to the agreement of merger or reorganization. Such agreement shall provide for the assumption of outstanding Options by the surviving corporation or its parent, for their continuation
by the Company (if the Company is a surviving corporation), for payment of a cash settlement equal to the difference between the amount to be paid for one Share under such agreement and the Exercise
Price, or for the acceleration of their exercisability followed by the cancellation of Options not exercised, in all cases without the Optionees' consent. Any cancellation shall not occur earlier than
30 days after such acceleration is effective and Optionees have been notified of such 

9

 

acceleration. In the case of Options that have been outstanding for less than 12 months, a cancellation need not be preceded by an acceleration. 

    (c) Reservation of Rights. Except as provided in this Section 9, an Optionee or Offeree shall have no rights by
reason of any subdivision or consolidation of shares of stock of any class, the payment of any dividend or any other increase or decrease in the number of shares of stock of any class. Any issue by
the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall not affect, and no adjustment by reason thereof shall be made with respect to, the
number or Exercise Price of Shares subject to an Option. The grant of an Option pursuant to the Plan shall not affect in any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business structure, to merge or consolidate or to dissolve, liquidate, sell or transfer all or any part of its business or assets. 

SECTION 10. SECURITIES LAWS.  

    Shares shall not be issued under the Plan unless the issuance and delivery of such Shares complies with (or is exempt from) all applicable requirements of law,
including (without limitation) the Securities Act
of 1933, as amended, the rules and regulations promulgated thereunder, state securities laws and regulations, and the regulations of any stock exchange on which the Company's securities may then be
listed. 

SECTION 11. NO EMPLOYMENT RIGHTS.  

    No provision of the Plan, nor any right or Option granted under the Plan, shall be construed to give any person any right to become, to be treated as, or to
remain an Employee. The Company and its Subsidiaries reserve the right to terminate any person's Service at any time and for any reason. 

SECTION 12. DURATION AND AMENDMENTS.  

    (a) Term of the Plan. The Plan, as set forth herein, shall become effective on March 8, 2001, subject to the
approval of the Company's stockholders. In the event that the stockholders fail to approve the amendment and restatement of the Plan at the 2001 annual meeting, any Option grants or Stock awards made
in excess of an aggregate of 8,650,000 Shares, including Shares transferred from the Directors' Plan, shall be null and void. The Plan shall terminate automatically on March 7, 2011, and may be
terminated on any earlier date pursuant to Subsection (c) below. 

    (b) Options Granted Under the 1990 Directors' Plan. The Directors' Plan has been merged into and consolidated with this
Plan, effective November 14, 2000. Options granted under the Directors' Plan that have not expired as of the effective date of the merger shall remain outstanding under this Plan, provided that
nothing in this Plan shall be construed to impair any right or add any obligation under such Option without the consent of the Optionee. 

    (c) Right to Amend or Terminate the Plan. The Board of Directors may amend, suspend or terminate the Plan at any time
and for any reason; provided, however, that any amendment of the Plan which (i) increases the number of Shares available for issuance under the Plan (except as provided in Section 9),
(ii) materially changes the class of persons who are eligible for the grant of ISOs or (iii) if required by Rule 16b-3 (or any successor) under the Exchange Act, would
materially increase the benefits accruing to participants under the Plan or would materially modify the requirements as to eligibility for participation in the Plan, shall be subject to the approval
of the Company's stockholders. Stockholder approval shall not be required for any other amendment of the Plan. 

    (d) Effect of Amendment or Termination. No Shares shall be issued or sold under the Plan after the termination thereof,
except upon exercise of an Option granted prior to such termination. The 

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termination of the Plan, or any amendment thereof, shall not affect any Share previously issued or any Option previously granted under the Plan. 

SECTION 13. EXECUTION.  

    To record the amendment and restatement of the Plan by the Board of Directors on March 8, 2001, the Company has caused its authorized officer to execute
the same. 

	 	 	THE IMMUNE RESPONSE CORPORATION
	

 	
 	

By:	
 	

/s/ DENNIS J. CARLO   

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IMMUNE RESPONSE CORPORATION 1989 STOCK INCENTIVE PLAN AS AMENDED AND RESTATED EFFECTIVE MARCH 8, 2001

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1989 STOCK PLAN OF THE IMMUNE RESPONSE CORPORATION (As Amended and Restated Effective March 8, 2001)

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