Document:

NEURALSTEM,
      INC.

    2007
      STOCK PLAN

    

    SECTION
      1 

    NAME
      AND PURPOSE

    

    1.1
       Name.  The
      name
      of the plan shall be the Neuralstem, Inc. 2007 Stock Plan (the
“Plan”)

    

    1.2.
      Purpose
      of Plan.
      The
      purpose of the Plan is to foster and promote the long-term financial success
      of
      the Company and increase stockholder value by: (a) motivating superior
      performance by means of stock incentives; (b) encouraging and providing for
      the
      acquisition of an ownership interest in the Company by Employees, Directors,
      Consultants and Advisors; and (c) enabling the Company to attract and retain
      the
      services of a management team responsible for the long-term financial success
      of
      the Company.

    

    SECTION
      2 

    DEFINITIONS

     

    2.1
       Definitions.
      Whenever
      used herein, the following terms shall have the respective meanings set forth
      below:

     

    
      	 	
              (a)
                

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

            

    

    

    
      	 	
              (b)
                

            	
              “Award”
                means any Option, Stock Appreciation Right, Restricted Stock, Stock
                Bonus,
                or any combination thereof granted under the Plan, including Awards
                combining two or more types of Awards in a single
                grant.

            

    

    

    
      	 	
              (c)
                

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

            

    

    

    
      	 	
              (d)
                

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

            

    

    

    
      	 	
              (e)
                

            	
              “Committee”
                means the Compensation Committee of the
                Board.

            

    

    

    
      	 	
              (f)
                

            	
              “Company”
                means Neuralstem, Inc., a Delaware corporation (and any successor
                thereto)
                and its Subsidiaries.

            

    

    

    
      	           (g)	
              "Consultants"
                and "Advisors" shall include any third party (and/or employees or
                principals thereof) retained or engaged by the Company to provide
                ongoing
                consulting services to the Company, including any consulting company
                wholly owned by such person; provided that such consultant: (a) possess
                technical, business, management, or legal expertise of value to the
                Company or an affiliate; (b) spends a significant amount of time
                and
                attention on the business and affairs of the Company; and (c) has
                a
                relationship with the Company or an affiliate that enables the individual
                to have knowledge concerning the business and affairs of the
                Company.

            

    

    

    
      	 	
              (h)
                

            	
              “Director
                Award” means an Award other than an Incentive Stock Option granted to an
                Eligible Director.

            

    

    

    
      	 	
              (i)
                

            	
              “Eligible
                Director” means a person who is serving as a member of the Board and who
                is not an Employee.

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	 	
              (i)
                

            	
              “Employee”
                means any employee of the Company or any of its
                Subsidiaries.

            

    

    

    
      	 	
              (j)
                

            	
              “Fair
                Market Value” means, on any date, the closing price of the Stock as
                reported on the New York Stock Exchange (or on such other recognized
                market or quotation system on which the trading prices of the Stock
                are
                traded or quoted at the relevant time) on such date. In the event
                that
                there are no Stock transactions reported on such exchange (or such
                other
                system) on such date, Fair Market Value shall mean the closing price
                on
                the immediately preceding date on which Stock transactions were so
                reported.

            

    

    

    
      	 	
              (k)
                

            	
              “Option”
                means the right to purchase Stock at a stated price for a specified
                period
                of time. For purposes of the Plan, an Option may be either (i) an
                Incentive Stock Option within the meaning of Section 422 of the Code
                or
                (ii) a Nonstatutory Stock Option.

            

    

    

    
      	 	
              (l)
                

            	
              “Participant”
                means any Employee or Eligible Director designated by the Committee
                to
                participate in the Plan.

            

    

    

    
      	 	
              (m)
                

            	
              “Plan”
                means the Neuralstem, Inc. 2007 Stock Plan, as in effect from time
                to
                time.

            

    

    

    
      	 	
              (n)
                

            	
              “Restricted
                Stock” shall mean a share of Stock granted to a Participant subject to
                such restrictions as the Committee may
                determine.

            

    

    

    
      	 	
              (o)
                

            	
              “Stock”
                means the Common Stock of the Company, par value $.0l per
                share.

            

    

    

    
      	 	
              (p)
                

            	
              “Stock
                Appreciation Right” means the right, subject to such terms and conditions
                as the Committee may determine, to receive an amount in cash or Stock,
                as
                determined by the Committee, equal to the excess of (i) the Fair
                Market
                Value, as of the date such Stock Appreciation Right is exercised,
                of the
                number shares of Stock covered by the Stock Appreciation Right being
                exercised over (ii) the aggregate exercise price of such Stock
                Appreciation Right.

            

    

    

    
      	 	
              (q)
                

            	
              “Stock
                Bonus” means the grant of Stock as compensation from the Company in lieu
                of cash salary or bonuses otherwise payable to the Participant and
                stock
                issued for service awards and other similar Employee recognition
                programs.

            

    

    

    
      	 	
              (r)
                

            	
              “Subsidiary”
                means any corporation, partnership, joint venture or other entity
                in which
                the Company owns, directly or indirectly, 50% or more of the voting
                power
                or of the capital interest or profits interest of such
                entity.

            

    

     

    2.2
       Gender
      and Number.
      Except
      when otherwise indicated by the context, words in the masculine gender used
      in
      the Plan shall include the feminine gender, the singular shall include the
      plural, and the plural shall include the singular.

    

    SECTION
      3 

    ELIGIBILITY
      AND PARTICIPATION

     

    The
      only
      persons eligible to participate in the Plan shall be those Employees,
      Consultants, Advisors and Eligible Directors selected by the Committee as
      Participants.

    
      
         

      

      
        2

        
          

        

      

       

    

    

    SECTION
      4 

    POWERS
      OF THE COMMITTEE

    

    4.1
       Power
      to Grant.
      The
      Committee shall determine the Participants to whom Awards shall be granted,
      the
      type or types of Awards to be granted, and the terms and conditions of any
      and
      all such Awards. The Committee may establish different terms and conditions
      for
      different types of Awards, for different Participants receiving the same type
      of
      Awards, and for the same Participant for each Award such Participant may
      receive, whether or not granted at different times.

    

    4.2
       Administration.
      The
      Committee shall be responsible for the administration of the Plan. The
      Committee, by majority action thereof, is authorized to prescribe, amend, and
      rescind rules and regulations relating to the Plan, to provide for conditions
      deemed necessary or advisable to protect the interests of the Company, and
      to
      make all other determinations necessary or advisable for the administration
      and
      interpretation of the Plan in order to carry out its provisions and purposes.
      Determinations, interpretations, or other actions made or taken by the Committee
      pursuant to the provisions of the Plan shall be final, binding, and conclusive
      for all purposes and upon all persons.

    

    SECTION
      5 

    STOCK
      SUBJECT TO PLAN

    

      
      5.1
 Number.
      Subject
      to the provisions of Section 5.3, the number of shares of Stock subject to
      Awards under the Plan may not exceed 6,150,000 shares of Stock. The shares
      to be
      delivered under the Plan may consist, in whole or in part, of treasury Stock
      or
      authorized but unissued Stock, not reserved for any other purpose.

     

    5.2
       Cancelled,
      Terminated, Forfeited or Surrendered Awards.
      Any
      shares of Stock subject to an Award which for any reason are cancelled,
      terminated or otherwise settled without the issuance of any Stock shall again
      be
      available for Awards under the Plan. In the event that any Award is exercised
      through the delivery of Stock or in the event that withholding tax liabilities
      arising from such Award are satisfied by the withholding of Stock by the
      Company, the number of shares available for Awards under the Plan shall be
      increased by the number of shares so surrendered or withheld.

     

    5.3
       Adjustment
      in Capitalization.
      Unless
      the Committee shall determine otherwise, in the event of any Stock dividend
      or
      Stock split, recapitalization (including, without limitation, the payment of
      an
      extraordinary dividend), merger, consolidation, combination, spin-off,
      distribution of assets to shareholders, exchange of shares, or other similar
      corporate transaction or event, (i) the aggregate number of shares of Stock
      available for Awards under Section 5.1 and (ii) the number of shares and
      exercise price with respect to Options and the number, prices and dollar value
      of other Awards, shall be appropriately adjusted by the Committee, whose
      determination shall be conclusive.

    

    SECTION
      6 

    STOCK
      OPTIONS

    

    6.1
       Grant
      of Options.
      Options
      may be granted to Participants at such time or times as shall be determined
      by
      the Committee. Options granted under the Plan may be of two types: (i) Incentive
      Stock Options and (ii) Nonstatutory Stock Options. The Committee shall have
      complete discretion in determining the number of Options, if any, to be granted
      to a Participant. Each Option shall be evidenced by an Option agreement that
      shall specify the type of Option granted, the exercise price, the duration
      of
      the Option, the number of shares of Stock to which the Option pertains, the
      exercisability (if any) of the Option in the event of death, retirement,
      disability or termination of employment, and such other terms and conditions
      not
      inconsistent with the Plan as the Committee shall determine, or, in the case
      of
      Incentive Stock Options, as may be required by the Code. Options may also be
      granted in replacement of or upon assumption of options previously issued by
      companies acquired by the Company by merger or stock purchase, and any options
      so replaced or assumed may have the same terms including exercise price as
      the
      options so replaced or assumed.

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    6.2
       Option
      Price.
      Nonstatutory Stock Options and Incentive Stock Options granted pursuant to
      the
      Plan shall have an exercise price which is not less than the Fair Market Value
      on the date the Option is granted.

    

    6.3
       Exercise
      of Options.
      Options
      awarded to a Participant under the Plan shall be exercisable at such times
      and
      shall be subject to such restrictions and conditions as the Committee may
      impose, subject to the Committee's right to accelerate the exercisability of
      such Option in its discretion. Notwithstanding the foregoing, no Option shall
      be
      exercisable for more than ten years after the date on which it is
      granted.

    

    6.4
       Payment.
      The
      Committee shall establish procedures governing the exercise of Options, which
      shall require that written notice of exercise be given and that the Option
      price
      be paid in full in cash or cash equivalents, including by personal check, at
      the
      time of exercise or pursuant to any arrangement that the Committee shall
      approve. The Committee may, in its discretion, permit a Participant to make
      payment (i) by tendering, by either actual delivery of shares or by attestation,
      shares of Stock already owned by the Participant valued at its Fair Market
      Value
      on the date of exercise (if such Stock has been owned by the Participant for
      at
      least six months) or (ii) by electing to have the Company retain Stock which
      would otherwise be issued on exercise of the Option, valued at its Fair Market
      Value on the date of exercise (“cashless exercise”) or (iii) or by way of net
      cash exercise. As soon as practicable after receipt of a written exercise notice
      and full payment of the exercise price, the Company shall deliver to the
      Participant a certificate or certificates representing the acquired shares
      of
      Stock. The Committee may permit a Participant to elect to pay the exercise
      price
      upon the exercise of an Option by irrevocably authorizing a third party to
      sell
      shares of stock (or a sufficient portion of the shares) acquired upon the
      exercise of the Option and remit to the Company a sufficient portion of the
      sale
      proceeds to pay the entire exercise price and any required tax withholding
      resulting from such exercise.

    

    6.5
       Incentive
      Stock Options.
      Notwithstanding anything in the Plan to the contrary, no term of this Plan
      relating to Incentive Stock Options shall be interpreted, amended or altered,
      nor shall any discretion or authority granted under the Plan be so exercised,
      so
      as to disqualify the Plan under Section 422 of the Code, or, without the consent
      of any Participant affected thereby, to cause any Incentive Stock Option
      previously granted to fail to qualify for the Federal income tax treatment
      afforded under Section 421 of the Code.

    

    SECTION
      7 

    STOCK
      APPRECIATION RIGHTS

    

    7.1
       SAR's
      in Tandem with Options.
      Stock
      Appreciation Rights may be granted to Participants in tandem with any Option
      granted under the Plan, either at or after the time of the grant of such Option,
      subject to such terms and conditions, not inconsistent with the provisions
      of
      the Plan, as the Committee shall determine. Each Stock Appreciation Right shall
      only be exercisable to the extent that the corresponding Option is exercisable,
      and shall terminate upon termination or exercise of the corresponding Option.
      Upon the exercise of any Stock Appreciation Right, the corresponding Option
      shall terminate.

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

     

    7.2
       Other
      Stock Appreciation Rights.
      Stock
      Appreciation Rights may also be granted to Participants separately from any
      Option, subject to such terms and conditions, not inconsistent with the
      provisions of the Plan, as the Committee shall determine.

    

    SECTION
      8 

    RESTRICTED
      STOCK

    

    8.1
       Grant
      of Restricted Stock.
      The
      Committee may grant Restricted Stock to Participants at such times and in such
      amounts, and subject to such other terms and conditions not inconsistent with
      the Plan as it shall determine. Each grant of Restricted Stock shall be subject
      to such restrictions, which may relate to continued employment with the Company,
      performance of the Company, or other restrictions, as the Committee may
      determine. Each grant of Restricted Stock shall be evidenced by a written
      agreement setting forth the terms of such Award.

    

    8.2
       Removal
      of Restrictions.
      The
      Committee may accelerate or waive such restrictions in whole or in part at
      any
      time in its discretion.

    

    SECTION
      9 

    STOCK
      BONUSES

    

      The
      Committee may grant a Stock Bonus to a Participant at such times and in such
      amounts, and subject to such other terms and conditions not inconsistent with
      the Plan, as it shall determine. Such stock bonuses shall only be granted in
      lieu of cash compensation otherwise payable to an employee.

    

    SECTION
      10 

    AMENDMENT,
      MODIFICATION, AND TERMINATION OF PLAN

    

    10.1
       General.
      The
      Board may from time to time amend, modify or terminate any or all of the
      provisions of the Plan, subject to the provisions of this Section. The Board
      may
      not change the Plan in a manner which would prevent outstanding Incentive Stock
      Options granted under the Plan from being Incentive Stock Options without the
      written consent of the optionees concerned. Furthermore, the Board may not
      make
      any amendment which would (i) modify the employees or class of employees
      eligible to participate in the Plan, (ii) increase the number of shares of
      Stock
      subject to Awards under the Plan pursuant to Section 5.1, (iii) change the
      minimum exercise price for stock options as provided in Section 6.2, or (iv)
      extend the last date on which options may be granted, in each case without
      the
      approval of a majority of the outstanding shares of Stock entitled to vote
      thereon. No amendment or modification shall affect the rights of any Participant
      with respect to a previously granted Award, without the written consent of
      the
      Participant.

    

    10.2
       Termination
      of Plan.
      No
      further Options shall be granted under the Plan subsequent to 10 years from
      the
      date of adoption, or such earlier date as may be determined by the
      Board.

    

    SECTION
      11 

    MISCELLANEOUS
      PROVISIONS

    

    11.1
       Nontransferability
      of Awards.
      Except
      as otherwise provided by the Committee (which cannot so provide with respect
      to
      an Incentive Stock Option), no Awards granted under the Plan may be sold,
      transferred, pledged, assigned, or otherwise alienated or hypothecated, other
      than by will or by the laws of descent and distribution.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

     

    11.2
       Beneficiary
      Designation.
      Except
      with respect to Incentive Stock Options, each Participant under the Plan may
      from time to time name any beneficiary or beneficiaries (who may be named
      contingent or successively) to whom any benefit under the Plan is to be paid
      or
      by whom any right under the Plan is to be exercised in case of his death. Each
      designation will revoke all prior designations by the same Participant, shall
      be
      in a form prescribed by the Committee, and will be effective only when filed
      in
      writing with the Committee. In the absence of any such designation, Awards
      outstanding at death may be exercised by the Participant's surviving spouse,
      if
      any, or otherwise by his estate.

    

    11.3
       No
      Guarantee of Employment or Participation.
      Nothing
      in the Plan shall interfere with or limit in any way the right of the Company
      or
      any Subsidiary to terminate any Participant's employment at any time, nor confer
      upon any Participant any right to continue in the employ of the Company or
      any
      Subsidiary. No Employee shall have a right to be selected as a Participant,
      or,
      having been so selected, to receive any future Awards.

    

    11.4
       Tax
      Withholding.
      The
      Company shall have the power to withhold, or require a Participant to remit
      to
      the Company, an amount sufficient to satisfy federal, state, and local
      withholding tax requirements on any Award under the Plan, and the Company may
      defer issuance of Stock until such requirements are satisfied. The Committee
      may, in its discretion, permit a Participant to elect, subject to such
      conditions as the Committee shall impose, (i) to have shares of Stock otherwise
      issuable under the Plan withheld by the Company or (ii) to deliver to the
      Company previously acquired shares of Stock, in each case having a Fair Market
      Value sufficient to satisfy all or part of the Participant's estimated total
      federal, state and local tax obligation associated with the
      transaction.

    

    11.5
       Agreements
      with Company.
      An Award
      under the Plan shall be subject to such terms and conditions, not inconsistent
      with the Plan, as the Committee may, in its sole discretion, prescribe. The
      terms and conditions of any Award to any Participant shall be reflected in
      such
      form of written document as is determined by the Committee or its
      designee.

    

    11.6
       Company
      Intent.
      The
      Company intends that the Plan comply in all respects with Rule 16b-3 under
      the
      Act, and any ambiguities or inconsistencies in the construction of the Plan
      shall be interpreted to give effect to such intention.

    

    11.7
       Requirements
      of Law.
      The
      granting of Awards and the issuance of shares of Stock shall be subject to
      all
      applicable laws, rules, and regulations, and to such approvals by any
      governmental agencies or securities exchanges as may be required.

    

    11.8
       Effective
      Date.
      The Plan
      became effective upon its adoption by the Board on [___________] (followed
      by
      approval by the Company's shareholders via written consent on
      [__________]).

    

    11.9
       Governing
      Law.
      The
      Plan, and all agreements hereunder, shall be construed in accordance with and
      governed by the laws of the State of Delaware.

     

    
      
         

      

      
        6NEURALSTEM,
      INC.

    

    2005
      Stock Plan

    

    Amended
      and Restated on [_____], 2007

    

    1. Purpose.
      This
      2005 Stock Plan (the "Plan") is intended to provide incentives to directors,
      officers, employees and consultants of Neuralstem, Inc. (the "Company") by
      providing them with opportunities to purchase stock in the Company pursuant
      to
      options granted hereunder which do not qualify as "incentive stock options"
      under Section 422, hereinafter referred to as an “ISO”) (b) of the Internal
      Revenue Code of 1986 as amended (the "Code") ("Non-Qualified Option" or
      "Non-Qualified Options"). Non-Qualified Options are referred to hereafter
      individually as an "Option" and collectively as "Options" and sometimes referred
      to as "Stock Rights".

    

    2. Administration
      of the Plan.

    

    A. Board.
      The
      Plan shall be administered by the Board of Directors. (i)The Board shall have
      the authority to determine (from among the class of individuals and entities
      eligible under Paragraph 3 to receive Non-Qualified Options) to whom
      Non-Qualified Options may be granted; (ii) determine the time or times at which
      Options may be granted; (iii) determine the option price of shares subject
      to
      each Option, which price shall not be less than the minimum price specified
      in
      Paragraph 6; (iv) determine (subject to Paragraph 7) the time or times when
      each
      Option shall become exercisable and the duration of the exercise period; (v)
      determine whether restrictions such as repurchase options are to be imposed
      on
      shares subject to Options and the nature of such restrictions, if any, and
      (vi)
      interpret the Plan and prescribe and rescind rules and regulations relating
      to
      it. If the Board determines to issue a Non-Qualified Option, it shall take
      whatever actions it deems necessary, under Section 422 of the Code and the
      regulations promulgated thereunder, to ensure that such Option is not treated
      as
      an ISO. The interpretation and construction by the Board of any provisions
      of
      the Plan or of any Stock Right granted under it shall be final. No member of
      the
      Board shall be liable for any action or determination made in good faith with
      respect to the Plan or any Stock Right granted under it.

    

    B. Grant
      of Stock Rights to Board Members.
      Stock
      Rights may be granted to members of the Board. All grants of Stock Rights to
      members of the Board shall in all respects be made in accordance with the
      provisions of this Plan applicable to other eligible persons. Members of the
      Board who are either (i) eligible for Stock Rights pursuant to the Plan or
      (ii)
      have been granted Stock Rights may vote on any matters affecting the
      administration of the Plan or the grant of any Stock Rights pursuant to the
      Plan, except that no such member shall act upon the granting to himself of
      Stock
      Rights, but any such member may be counted in determining the existence of
      a
      quorum at any meeting of the Board, during which action is taken with respect
      to
      the granting to him of Stock Rights.

     

    3. Eligible
      Employees and Others.
      Non-Qualified Options, may be granted to any employee, officer or director
      (whether or not also an employee) or consultant of the Company. Granting of
      any
      Stock Right to any individual shall neither entitle that individual, nor
      disqualify him from, participation in any other grant of Stock
      Rights.

    

    4. Stock.
      The
      stock subject to Options shall be authorized but unissued shares of Common
      Stock
      of the Company (the "Common Stock"), or shares of Common Stock reacquired by
      the
      Company in any manner. The aggregate number of shares which may be issued
      pursuant to the Plan is Four Million (4,000,000), subject to adjustment as
      provided in Paragraph 11. All such shares shall be issued as Non-Qualified
      Options, so long as the number of shares so issued does not exceed such number,
      as adjusted. If any Option granted under the Plan shall expire or terminate
      for
      any reason without having been exercised in full or shall cease for any reason
      to be exercisable, the unpurchased shares subject to such Options and any
      unvested shares so reacquired by the Company shall again be available for grants
      of Stock Rights under the Plan.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    5. Granting
      of Stock Rights.
      Stock
      Rights may be granted under the Plan at any time after July 27, 2005 and prior
      to July 27, 1, 2010. The date of grant of a Stock Right under the Plan will
      be
      the date specified by the Board at the time it grants the Stock Right; provided,
      however, that such date shall not be prior to the date on which the Board acts
      to approve the grant. 

    

    6. Minimum
      Option Price.

    

    A. Price
      for Non-Qualified Options.
      The
      exercise price per share specified in the agreement relating to each
      Non-Qualified Option granted under the Plan shall in no event be less than
      the
      fair market value per share of Common Stock on the date of such
      grant.

    

    B. Determination
      of Fair Market Value.
      If, at
      the time an Option is granted under the Plan, the Company's Common Stock is
      publicly traded, "fair market value" shall be determined as of the last business
      day for which the prices or quotes discussed in this sentence are available
      prior to the date such Option is granted and shall mean (i) the average (on
      the
      date) of the high and low prices of the Common Stock on the principal national
      securities exchange on which the Common Stock is traded, if the Common Stock
      is
      then traded on a national securities exchange; or (ii) the last reported sale
      price (on that date) of the Common Stock on the NASDAQ National Market List,
      if
      the Common Stock is not then traded on a national securities exchange; or (iii)
      the closing bid price (or average of bid prices) last quoted (on that date)
      by
      an established quotation service for over-the-counter securities, if the Common
      Stock is not reported on the NASDAQ National Market List. However, if the Common
      Stock is not publicly traded at the time an Option is granted under the Plan,
      "fair market value" shall be deemed to be the fair market value of the Common
      Stock as determined by the Board after taking into consideration all factors
      which it deems appropriate, including, without limitation, recent sale and
      offer
      prices of the Common Stock in private transactions negotiated at arm's
      length.

    

    7. Option
      Duration.
      Each
      Option shall expire on the date specified by the Board, but not more than ten
      years and one day from the date of grant. 

    

    8. Exercise
      of Option.
      Subject
      to the provisions of Paragraphs 9 and 10, each Option granted under the Plan
      shall be exercisable as follows:

    

    A. Vesting.
      The
      Option shall either be fully exercisable on the date of grant or shall become
      exercisable thereafter in such installments as the Board may
      specify.

    

    B. Full
      Vesting of Installments.
      Once an
      installment becomes exercisable it shall remain exercisable until expiration
      or
      termination of the Option, unless otherwise specified by the Board.

    

    C. Partial
      Exercise.
      Each
      Option or installment may be exercised at any time or from time to time, in
      whole or in part, for up to the total number of shares with respect to which
      it
      is then exercisable.

    

    D. Acceleration
      of Vesting.
      The
      Board shall have the right to accelerate the date of the exercise of any
      installment of any Option. In addition, in the event of the merger or
      consolidation of the Company with another corporation, whether or not the
      Company is the surviving corporation, or a transaction whereby a majority of
      the
      stock of the Company is owned by a person or entity not a stockholder on the
      date an Option is granted, the date of exercise of an installment shall be
      accelerated.

    

    9. Assignability.
      No
      Option shall be assignable or transferable by the optionee except by will or
      by
      the laws of descent and distribution, and, during the lifetime of the optionee
      each Option, shall be exercisable only by him.

     

    
      
         

      

      
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    10. Terms
      and Conditions of Options.
      Options
      shall be evidenced by instruments (which need not be identical) in such forms
      as
      the Board may from time to time approve. Such instruments shall conform to
      the
      terms and conditions set forth in Paragraphs 6 through 9 hereof and may contain
      such other provisions as the Board deems advisable which are not inconsistent
      with the Plan, including restrictions applicable to shares of Common Stock
      issuable upon exercise of Options. In granting any Non-Qualified Option, the
      Board may specify that such Non-Qualified Option shall be subject to the
      restrictions or to such termination and cancellation provisions as the Board
      may
      determine. The Board may from time to time confer authority and responsibility
      on one or more of its own members and/or one or more officers of the Company
      to
      execute and deliver such instruments. The proper officers of the Company are
      authorized and directed to take any and all actions necessary or advisable
      from
      time to time to carry out the terms of such instruments.

    

    11. Adjustments.
      Upon
      the occurrence of any of the following events, an optionee's rights with respect
      to Options granted to him hereunder shall be adjusted as hereinafter provided,
      unless otherwise specifically provided in the written agreement between the
      optionee and the Company relating to such Option. If the shares of common stock
      of the Company are changed into or exchanged for a different number or kind
      of
      shares or other securities of the Company or of another corporation, whether
      through reorganization, recapitalization, share split-up, combination of shares,
      merger, or consolidation, there shall be substituted for each share of common
      stock of the Company then subject to the Option, the number and kinds of shares
      or other securities into which each such outstanding share of common stock
      is so
      changed or for which each such share is exchanged. 

    

    In
      the
      event of the proposed dissolution or liquidation of the Company, each Option
      will terminate immediately prior to the consummation of such proposed action
      or
      at such other time and subject to such other conditions as shall be determined
      by the Board.

    

    Except
      as
      expressly provided herein, no issuance by the Company of shares of stock of
      any
      class, or securities convertible into shares of stock of any class, shall
      affect, and no adjustment by reason thereof shall be made with respect to,
      the
      number or price of shares subject to Options. No adjustments shall be made
      for
      dividends paid in cash or in property other than securities of the
      Company.

    

    No
      fractional shares shall be issued under the Plan and the optionee shall receive
      from the Company cash in lieu of such fractional shares.

    

    If
      any
      person or entity owning restricted Common Stock obtained by exercise of a Stock
      Right made hereunder receives shares or securities or cash in connection with
      a
      corporate transaction described above as a result of owning such restricted
      Common Stock, such shares or securities or cash shall be subject to all of
      the
      conditions and restrictions applicable to the restricted Common Stock with
      respect to which such shares or securities or cash were issued, unless otherwise
      determined by the Board.

    

    12. Means
      of Exercising Stock Rights.
      A Stock
      Right (or any part or installment thereof) shall be exercised by giving written
      notice to the Company at its principal office address. Such notice shall
      identify the Stock Right being exercised and specify the number of shares as
      to
      which such Stock Right is being exercised, accompanied by full payment of the
      purchase price therefor either (i) by tendering, by either actual delivery
      of
      shares or by attestation, shares of Stock already owned by the Optionee valued
      at its Fair Market Value on the date of exercise (if such Stock has been owned
      by the Participant for at least six months) or (ii) by electing to have the
      Company retain Stock which would otherwise be issued on exercise of the Option,
      valued at its Fair Market Value on the date of exercise (“cashless exercise”) or
      (iii) or by way of net cash exercise, or by a combination of the forgoing.
      The
      holder of a Stock Right shall not have the rights of a shareholder with respect
      to the shares covered by his Stock Right until the date of issuance of a Stock
      certificate to him for such shares. Except as expressly provided above in
      Paragraph 11 with respect to changes in capitalization and stock dividends,
      no
      adjustment shall be made for dividends or similar rights for which the record
      date is before the date such stock certificate is issued.

     

    
      
         

      

      
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    13. Term
      and Amendment of Plan.
      This
      Plan was adopted by the Board on July 27, 2005, subject to approval of the
      Plan
      by the stockholders of the Company at the next Meeting of Stockholders or,
      in
      lieu thereof, by written consent. The Plan shall expire at the end of the day
      on
      July 26, 2010 (except as to Options outstanding on that date). Subject to the
      provisions of Paragraph 5 above, Stock Rights may be granted under the Plan
      prior to the date of stockholder approval of the Plan. The Board may terminate
      or amend the Plan in any respect at any time, except that, without the approval
      of the stockholders obtained within 12 months before or 12 months after the
      Board adopts a resolution authorizing any of the following actions: (a) the
      total number of shares that may be issued under the Plan may not be increased
      (except by adjustment pursuant to Paragraph 11); and (b) the expiration date
      of
      the Plan may not be extended. Except as otherwise provided in this Paragraph
      13,
      in no event may action of the Board or stockholders alter or impair the rights
      of a grantee, without his consent, under any Stock Right previously granted
      to
      him.

    

    14. Application
      of Funds.
      The
      proceeds received by the Company from the sale of shares pursuant to Options
      granted and Purchases authorized under the Plan shall be used for general
      corporate purposes.

    

    15. Governmental
      Regulation.
      The
      Company's obligation to sell and deliver shares of the Common Stock under this
      Plan is subject to the approval of any governmental authority required in
      connection with the authorization, issuance or sale of such shares.

    

    16. Withholding
      of Additional Income Taxes.
      Upon
      the exercise of a Non-Qualified Option, the Company, in accordance with Section
      3402 (a) of the Code, may require the optionee, to pay additional withholding
      taxes in respect of the amount that is considered compensation includible in
      such person's gross income. The Board in its discretion may condition (i) the
      exercise of an Option, on the grantee's payment of such additional withholding
      taxes.

    

    17. Governing
      Law; Construction.
      The
      validity and construction of the Plan and the instruments evidencing Stock
      Rights shall be governed by the laws of the State of Delaware, or the laws
      of
      any jurisdiction in which the Company or its successors in interest may be
      organized. In construing this Plan, the singular shall include the plural and
      the masculine gender shall include the feminine and neuter, unless the context
      otherwise requires.

     

    
      
         

      

      
        4

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