Document:

EXHIBIT 4.2
                                   -----------

                             SOLANEX MANAGEMENT INC.
                          2004 PERFORMANCE STOCK PLAN

                        PERFORMANCE STOCK AWARD AGREEMENT

EMPLOYEE:                     ((Name))

NUMBER OF SHARES:             ((Total Shares))  Shares

DATE  OF  GRANT:              ((Grant Date))

PERFORMANCE PERIOD (IF ANY):  A Period of ______________ Days  from  the Date of
                              Grant,  unless  sooner  terminated  by  reason  of
                              death,  disability  or other termination of status
                              as  a  Participant,  as defined in this Agreement.

PERFORMANCE GOALS (IF ANY):   See  Exhibit  A.

     THIS  AWARD AGREEMENT (the "AGREEMENT") is entered into effective as of the
_______  day  of  __________,  2004  by  and  between SOLANEX MANAGEMENT INC., a
Nevada  corporation  (the  "COMPANY"),  and the individual designated above (the
"PARTICIPANT").

                                    RECITALS
                                    --------

     A.     The  2004  Performance  Stock  Plan  (the "PLAN") was adopted by the
Company  on  July  21,  2004;  and

     B.     The  Participant  performs  valuable  services  for  the  Company, a
Subsidiary  or  a  Parent;  and

     C.     As  of  the  date  hereof,  the  Board  of  Directors of the Company
establishes the terms, conditions, restrictions and limitations applicable to an
Award  and  as  provided  herein;

     NOW,  THEREFORE,  the  parties  agree  to  the terms and conditions herein,
including  the  recitals.

<PAGE>

1.     GRANT  OF  PERFORMANCE  SHARES.
       ------------------------------

     1.1  Award.  The  grant  of  Performance  Shares under the Plan to a
          -----
Participant  by  the  Committee pursuant to such terms, conditions, restrictions
and  limitations, if any, as the Committee may establish by this Award Agreement
or  otherwise.

     1.2  Committee.  The  Board  of  Directors  of the Company or the
          ---------
Committee  appointed  by  the  Board  to  administer  the  Plan.

     1.3  Employee.  Any  person  employed  by  or  serving  as  an
          --------
employee,  officer  or  director  of  the  Employer  or  any  Subsidiary  of the
Employer  that  is  hereafter  organized  or  acquired  by  the  Employer.

     1.4  Consultant.  Any  natural  person  who  provides  bona  fide  services
          ----------
to the  Employer that are not in connection with the offer or sale of securities
in a  capital-raising  transaction,  and  do  not directly or indirectly promote
or  maintain  a  market  for  the  Employer's  securities  (includes
"Advisors").

     1.5  Participant.  An  Employee  or  Consultant  of  the Company or its
          -----------
subsidiaries  selected  by  the  Committee  to  participate  in the Plan.

     1.6  Performance  Goals.  The  performance  criterion  or criteria
          ------------------
established  by  the  Committee  pursuant  to  the  Plan.

     1.7  Performance  Period.  That  period  established  by  the Committee
          -------------------
at  the  time  Performance  Shares  are  granted  within  which  the
Participant  must  meet  his  or  her  Performance  Goals.

     1.8  Performance  Share.  Any  grant  pursuant  to  the  Plan  of  a unit
          ------------------
valued  by  reference  to  a  designated number of shares of common stock, which
value  may  be  paid  to  the  Participant  by  delivery or such property as the
Committee  shall  determine,  including  cash,  common  stock or any combination
thereof.

     1.9  Construction.  This  Agreement  shall be  construed  in accordance and
          ------------
consistent  with,  and subject to, the provisions of the Plan (the provisions of
which  are  incorporated herein by reference) and, except as otherwise expressly
set  forth  herein,  the capitalized terms used in this Agreement shall have the
same  definitions  as  set  forth  in  the  Plan.

     1.10  Condition.  The  Award  is  conditioned  on  the Participant's
           ---------
execution  of  this  Agreement.  If  this  Agreement  is  not  executed  by  the
Participant  it  may  be  canceled  by  the  Board.

2.     PERFORMANCE  PERIOD.
       -------------------

     An  Award  of  Performance  Shares  is  granted  as of the first day of the
Performance  Period.  The  Performance  Period  shall  be  as  specified  above,

<PAGE>

commencing  on  the  date  of  grant.  At the end of the Performance Period, the
Performance  Shares  are converted into common stock of the Company or cash or a
combination  of  the  two  as  specified  herein.  The Award may be forfeited or
terminated,  however,  as  provided  in  the Plan or in Section 1.7 or Section 5
Hereof.

3.     PERFORMANCE  GOALS.
       ------------------

     Performance  Goals,  if  any, are established by the Committee on or before
the  Date of Grant. The Award shall vest with respect to the Performance Shares,
on  or  after  the  dates set forth above, subject to earlier termination of the
Award  as  provided  in  Section  1.7  and  Section  5  hereof  or  in the Plan.

4.         PERFORMANCE  SHARE  RIGHTS.
           --------------------------

     4.1  Participants  may  be  required  or may elect to defer the issuance of
Performance Shares or the settlement of Awards in cash as follows: [disclose any
deferrals  or  settlements]

     4.2 Awards of Performance Shares may provide the Participant with dividends
or  dividend  equivalents  and  voting  rights  at  the  time  of  grant.

5.     TERMINATION  OF  EMPLOYMENT.
       ----------------------------

     5.1     Termination  of  Participant  Due  to  Death.  If the Participant's
             --------------------------------------------
employment  is  or  services  are terminated at any time due to the death of the
Participant,  the Award shall, on the date of termination, be paid in full, paid
on  an  as earned basis or terminated, as determined by the Committee.  If paid,
the  Award  shall  be  paid  to  the  Participant's estate, or to such person or
persons  who  have  acquired  the  right  to  receive the Award by bequest or by
inheritance  or  by  reason  of  the  death  of  the  Participant.

     5.2     Termination  of  Employment  Due  to  Disability.  If Participant's
             ------------------------------------------------
employment  is  or services are terminated by reason of a disability (within the
meaning  of  Section  22(e)(3)  of  the Code) and if the Participant had been in
Continuous  Status as an Employee or Consultant at all times between the date of
grant  of  the  Award  and  termination  of  his or her status as an Employee or
Consultant,  the  Award shall, on the date of termination, be paid in full, paid
on  as  earned  basis  or  terminated,  as  determined  by  the  Committee.

     5.3     Termination  of  Employment  for Other Reasons.    If Participant's
             ----------------------------------------------
status as an Employee or Consultant is terminated by the Participant at any time
after  the  grant  of an Award for any reason other than death or disability, as
provided  in  Sections  4.1  and 4.2, and not for "cause" as provided below, the
Award  shall  be  paid  in  full,  paid  on as earned basis or is terminated, as
determined  by the Committee, on the date of termination of Participant's status
as  an  Employee  or  Consultant.

If  Participant's  status  as  an  Employee  is  terminated  for  "cause"  (such
termination  being  referred to as a "Termination for Cause") at any time by the
Company after the grant of an Award by the Company, then the Award terminates on
the date of termination of Participant's status as an Employee.  For purposes of

<PAGE>

this  Section  5.3,  Termination  for  "cause"  shall  mean a termination due to
objective  evidence  of any of the following: (i) material dishonesty related to
employment;  (ii) fraud; (iii) commission of a felony or a crime involving moral
turpitude;  (iv) theft of Company property or intentional destruction of Company
property without good reason and causing significant damage; (v) physical attack
resulting  in  physical  injury  to  a fellow employee or other individual; (vi)
unsanctioned  intoxication  at work; (vii) use of unlawful drugs at work; (viii)
any  form  of  substance  abuse  (including  alcohol)  to  the  extent  that  it
significantly  impairs  the performance of duties; or (ix) gross insubordination
or  gross  dereliction  of  duty.

     5.4     Employment by Subsidiary.  For purposes of this Section and Section
             ------------------------
8, employment with the Company includes employment with any Parent or Subsidiary
of  the  Company  and  service  as  a  Director  of the Company or any Parent or
Subsidiary  shall  be  considered  employment  with  the  Company.  A  change of
employment  between  the  Company  and  any  Parent  or  Subsidiary  (or between
Subsidiaries  or  between  a  Subsidiary  and  a Parent) is not a termination of
employment  under  this  Agreement.

6.     TRANSFERABILITY.
        --------------

     Awards  of Performance Shares shall not be transferable or assignable other
than: (i) by will or the laws of descent and distribution; (ii) by gift or other
transfer  of  an  Award  to  any  trust  or  estate  in which the original Award
recipient  or  such  recipient's  spouse  or  other  immediate  relative  has  a
substantial  beneficial  interest,  or  to a spouse or other immediate relative,
provided  that  any  such  transfer  is  permitted  subject to Rule 16b-3 issued
pursuant  to  the Securities Exchange Act of 1934, as amended, as in effect when
such transfer occurs and the Board does not rescind this provision prior to such
transfer;  or (iii) pursuant to a qualified domestic relations order (as defined
by the Code).  However, any Award so transferred shall continue to be subject to
all  the  terms  and  conditions  contained  in  the  Award  Agreement.

7.     RESTRICTIONS  ON  THE  AWARDS;  RESTRICTIONS  ON  THE  SHARES.
       --------------------------------------------------------------

     The Award may not be paid in common stock unless, in the opinion of counsel
for  the  Company,  the  issuance  and  sale  of the common stock is exempt from
registration  under  the  Securities  Act  of  1933,  as  amended,  or any other
applicable  federal  or  state securities law, rule or regulation, or the common
stock  has  been  duly  registered  under  such  laws.  The Company shall not be
required  to  register  the common stock issuable pursuant to an Award under any
such  laws.  Unless  the  common  stock has been registered under all applicable
laws,  the Participant shall represent, warrant and agree, as a condition to the
issuance  of  the  common  stock,  that the shares issued are being received for
investment  only  and  without a view to any sale or distribution of such shares
and  that  such  shares  shall  not  be transferred or disposed of in any manner
without  registration  under  such laws, unless it is the opinion of counsel for
the  Company  that  such  a  disposition  is  exempt from such registration. The
Participant  acknowledges  that,  if  required by law, an appropriate legend, in
such  form  as  the  Company  shall  determine,  giving  notice of the foregoing
restrictions  shall  appear  conspicuously  on  all  certificates evidencing the
shares  issued  in  exchange  for  Performance  Shares.

<PAGE>

     The  Participant  also acknowledges and agrees that, in connection with any
public  offering  of  the  Company's  stock,  upon request of the Company or the
underwriters  managing  any  underwritten public offering of the Company's stock
and  making  such request with the approval of the Company's Board of Directors,
not to sell, make any short sale of, loan, grant any option for the purchase of,
or  otherwise  dispose  of  any  of  his or her shares without the prior written
consent  of  the  Company  or  such  underwriters,  as the case may be, from the
effective  date  of  such  registration  for  so  long  as  the  Company  or the
underwriters  may  specify,  but  in  any  event  not  to  exceed  180  days.

8.     NO  RIGHT  TO  CONTINUED  STATUS  AS  AN  EMPLOYEE  OR  CONSULTANT.
       ------------------------------------------------------------------

     Nothing  in this Agreement or the Plan shall be interpreted or construed to
confer  upon  the Participant any right with respect to continuance of status as
an  Employee or Consultant by the Company or any Parent or Subsidiary, nor shall
this Agreement or the Plan interfere in any way with the right of the Company or
a  Parent or Subsidiary to terminate the Participant's employment or services at
any  time.

9.     ADJUSTMENTS  UPON  CERTAIN  EVENTS.
       ----------------------------------
     In  the  event  of  a  change in capitalization, such as a stock split, the
Committee  shall  make appropriate adjustments to the number and class of shares
or  other  stock  or securities subject to the Award. The Committee's adjustment
shall  be made in accordance with the provisions of Section 6(h) of the Plan and
shall  be  effective  and  final, binding and conclusive for all purposes of the
Plan  and  this  Agreement.

     Subject  to  Section  6(j)  of  the  Plan,  upon  a  merger, consolidation,
separation,  reorganization or other business combination involving the Company,
the  Award shall be deemed earned. All amounts deferred pursuant to the Plan and
any  accrued  interest  thereon shall be paid in cash within 10 days of the sale
transaction  before  the date of closing of any sale transaction or such earlier
date  as  the  Committee  may  fix.

10.    WITHHOLDING  OF  TAXES.
       ----------------------
     The Company shall have the right to deduct from any distribution of cash to
the Participant an amount equal to the federal, state and local income taxes and
other  amounts  as  may  be  required  by  law to be withheld (the "Withholdings
Taxes")  with  respect  to  the Award. If the Participant is entitled to receive
shares, the Participant shall pay the Withholdings Taxes (if any) to the Company
in  cash  prior  to  the  issuance  of  such  shares.  In  satisfaction  of  the
withholdings  Taxes,  the  Participant  may  make  a  written election (the "Tax
Election"),  which  may  be  accepted  or  rejected  in  the  discretion  of the
Committee, to have withheld a portion of the shares issuable to him or her based
upon  the Award, having an aggregate Fair Market Value equal to the Withholdings
Taxes,  provided  that,  if  the  Participant  may be subject to liability under
Section  16(b)  of  the 1934 Act, the election must comply with the requirements
applicable  to  share  transactions  by  such  Participants.

<PAGE>

11.    MODIFICATION  OF  AGREEMENT.
       ---------------------------
     This  Agreement  may be modified, amended, suspended or terminated, and any
terms  or conditions may be waived, only by a written instrument executed by the
parties  hereto.

12.    SEVERABILITY.
       ------------
     Should  any  provision  of  this  Agreement be held by a court of competent
jurisdiction  to  be  unenforceable  or  invalid  for  any reason, the remaining
provisions  of  this  Agreement shall not be affected by such Holdings and shall
continue  in  full  force  in  accordance  with  their  terms.

13.    GOVERNING  LAW.
       --------------
     The  validity,  interpretation,  construction  and  performance  of  this
Agreement  shall  be  governed by the laws of the State of Nevada without giving
effect  to  the  conflicts  of  laws  principles  thereof.

14.    SUCCESSORS  IN  INTEREST.
       ------------------------
     This  Agreement  shall  be  binding  upon, and inure to the benefit of, the
Company  and  its successors and assigns, and upon any person acquiring, whether
by  merger,  consolidation,  reorganization,  purchase  of  stock  or assets, or
otherwise,  all or substantially all of the Company's assets and business.  This
Agreement  shall  inure  to  the  benefit  of  the Participant's heirs and legal
representatives.  All  obligations  imposed  upon the Participant and all rights
granted  to  the  Company  under  this  Agreement  shall  be  final, binding and
conclusive  upon  the  Participant's  heirs,  executors,  administrators  and
successors.

15.    RESOLUTION  OF  DISPUTES.
       ------------------------
     Any dispute or disagreement which may arise under, or as a result of, or in
any  way  relate  to,  the  interpretation,  construction or application of this
Agreement  shall  be  determined by the Board.  Any determination made hereunder
shall  be  final,  binding and conclusive on the Participant and the Company for
all  purposes.

[REMAINDER  OF  PAGE  INTENTIONALLY  LEFT  BLANK]

<PAGE>

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

     SOLANEX  MANAGEMENT  INC.

                    By:
                    Name:
                    Title:

     By  signing  below, Participant hereby accepts the Award subject to all its
terms  and  provisions and agrees to be bound by the terms and provisions of the
Plan.  Participant  hereby agrees to accept as binding, conclusive and final all
decisions  or  interpretations  of the Board of Directors of the Company, and of
the  Committee  responsible  for  administration of the Plan, upon any questions
arising  under  the  Plan.  Participant  authorizes  the Company to withhold, in
accordance with applicable law, from any compensation payable to him or her, any
taxes  required to be withheld by federal, state or local law as a result of the
grant,  existence  or  issuance  of  the Award or subsequent sale of the shares.

     PARTICIPANT

                    Signature:
                    Name:           Name

                                [EXHIBIT FOLLOWS]
<PAGE>

                                    EXHIBIT A
                                    ---------

                                PERFORMANCE GOALS
                                -----------------EX-10.1

EXHIBIT 10.1 

BIOCRYST
PHARMACEUTICALS, INC.

1991 STOCK
OPTION PLAN

AMENDED AND
RESTATED EFFECTIVE MARCH 8, 2004

ARTICLE ONE

GENERAL
PROVISIONS

I. PURPOSES OF THE PLAN

             
             A.
       This 1991 Stock Option Plan (the “Plan”) is intended to promote the
interests of BioCryst  Pharmaceuticals,  Inc., a Delaware  corporation (the “Company”),
by providing a method whereby (i) key employees (including officers and directors) of the
Company (or its parent or subsidiary corporations) who are responsible for the
management, growth and financial success of the Company (or any parent or subsidiary
corporations), (ii) non-employee members of the board of directors of the Company (or any
parent or subsidiary corporations) and (iii) consultants and other independent
contractors who provide valuable services to the Company (or any parent or subsidiary
corporations) may be offered the opportunity to acquire a proprietary interest, or
otherwise increase their proprietary interest, in the Company as an incentive for them to
remain in the service of the Company (or any parent or subsidiary corporations).  

             
             B.
       For purposes of the Plan, the following provisions shall be applicable in
determining the parent and subsidiary corporations of the Company: 

	 	             
             
             -
        Any corporation  (other than the Company) in an unbroken chain of corporations
 ending with the Company shall be considered            to be a parent  corporation of
the Company,  provided each such  corporation in the unbroken chain (other than the
Company) owns, at the time of the  determination,            stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of stock in one
of the other corporations in such chain.

	 	             
             
             -
        Each  corporation  (other than the  Company) in an  unbroken  chain of
 corporations  beginning  with the Company  shall be            considered to be a
subsidiary of the Company,  provided  each such  corporation  (other than the last
 corporation)  in the unbroken  chain owns, at the time of the            determination,
 stock  possessing  fifty percent (50%) or more of the total combined  voting power of
all classes of stock in one of the other  corporations in such            chain.

II. STRUCTURE OF THE PLAN

             
             A.
       Stock  Programs.  The Plan shall be divided  into two  separate  components:  the
 Discretionary  Option  Grant  Program  specified  in Article Two and the Automatic
Option Grant Program specified in Article Three. Under the Discretionary Option Grant
Program, eligible individuals may, at the discretion of the Plan Administrator, be
granted options to purchase shares of the Company’s common stock, par value $.01 per
share (the “Common Stock”) in accordance with the provisions of Article Two.
Under the Automatic Option Grant Program, certain non-employee members of the Board will
automatically receive a special one-time option grant as well as periodic option grants
to purchase shares of Common Stock in accordance with the provisions of Article Three.  

             
             B.
       General  Provisions.  Unless the  context  clearly  indicates  otherwise,  the
 provisions  of  Articles  One and Four of the Plan shall  apply to both the
Discretionary Option Grant Program and the Automatic Option Grant Program and shall
accordingly govern the interests of all individuals under the Plan.  

25 

III. ADMINISTRATION OF
THE PLAN

             
             A.
       A committee of two (2) or more  non-employee  Board members  appointed by the
Board (the “Primary  Committee”)  shall have sole and exclusive  authority to
administer the Discretionary Option Grant Program with respect to Section 16 Insiders.
For purposes of this Section, a Section 16 Insider shall mean an officer or director of
the Company subject to the short-swing profit liabilities of Section 16 of the Securities
Exchange Act of 1934 (the “1934 Act”).  

             
             B.
       Administration  of the  Discretionary  Option Grant Program with respect to all
other persons  eligible to  participate in that program may, at the Board’s
discretion, be vested in the Primary Committee or another committee of two (2) or more
non-employee Board members appointed by the Board (the “Secondary Committee”),
or the Board may retain the power to administer that program with respect to all such
persons.  

             
             C.
       Members of the Primary  Committee  and any  Secondary  Committee  shall serve for
such  period of time as the Board may  determine  and shall be subject to removal by the
Board at any time. 

             
             D.
       Each Plan  Administrator  (whether the Primary Committee,  the Board or the
Secondary  Committee) shall,  within the scope of its administrative  functions under the
Plan, have full power and authority (subject to the express provisions of the Plan) to
establish such rules and regulations as it may deem appropriate for the proper
administration of the Plan and to make such determinations under the Plan and any
outstanding option as it may deem necessary or advisable. Decisions of the Plan
Administrator within the scope of its administrative functions under the Plan shall be
final and binding on all parties with an interest in any outstanding option under the
Plan.  

             
             E.
        Administration  of the Automatic  Option Grant Program shall be  self-executing
 in accordance with the express terms and conditions of Article Three,  and the Committee
shall                                exercise no discretionary functions under that
program. 

IV. ELIGIBILITY FOR
OPTION GRANTS

             
             A.
       The persons eligible to participate in the Discretionary Option Grant Program
under Article Two of the Plan shall be limited to the following: 

	 	             
             
             (i)
      officers and other key  employees  of the Company (or its parent or  subsidiary
 corporations)  who render  services  which            contribute to the management,
growth and financial success of the Company (or its parent or subsidiary corporations);

	 	             
             
             (ii)
     those  consultants or independent  contractors  who provide  valuable  services to
the Company (or its parent or subsidiary            corporations); and

	 	             
             
             (iii)
    non-employee members of the Board (or the board of directors of its parent or
subsidiary corporations).

             
             B.
       Only Board  members who are not  employees at the time of the grant shall be
eligible to receive  automatic  option  grants  pursuant to the  provisions of Article
Three. 

             
             C.
       The Plan  Administrator  shall have full authority to determine  which eligible
 individuals  are to receive option grants under the  Discretionary  Option Grant
Program, the number of shares to be covered by each such grant, whether the granted
option is to be an incentive stock option (“Incentive Option”) which satisfies
the requirements of Section 422 of the Internal Revenue Code or a non-statutory option
not intended to meet such requirements, the time or times at which each such option is to
become exercisable, and the maximum term for which the option is to remain outstanding.  

V. STOCK SUBJECT TO THE
PLAN

             
             A.
       Shares of the Company’s  Common Stock shall be available for issuance  under
the Plan and shall be drawn from either the Company’s  authorized but unissued
shares of Common Stock or from reacquired shares of Common Stock, including shares
repurchased by the Company on the open market. The maximum number of shares of Common
Stock which may be issued over the term of the Plan shall not exceed 5,600,000 shares,
subject to adjustment from time to time in accordance with the provisions of this Section
V. Such authorized share reserve includes (i) the increase of 500,000 shares of Common
Stock authorized by the Board on February 8, 1994; (ii) the increase of 500,000 shares of
Common Stock authorized by the Board on March 16, 1995; (iii) the increase of 1,000,000
shares of Common Stock authorized by the Board on March 4, 1997; (iv) the increase of
400,000 shares of Common Stock authorized by the Board on March 1, 1999; (v) the increase
of 1,200,000 shares of Common Stock authorized by the Board on March 6, 2000; and (vi)
the increase of 1,000,000 shares of Common Stock authorized by the Board on March 8, 2004
subject to stockholder approval at the 2004 Annual Stockholders Meeting.  

26 

             
             B.
       In no event  shall the  number of shares of Common  Stock for which any one
 individual  participating  in the Plan may be  granted  stock  options  exceed 1,500,000
shares over the term of the Plan. For purposes of such limitation, however, no stock
options granted prior to the date the Common Stock was first registered under Section 12
of the 1934 Act (the “Section 12(g) Registration Date”) shall be taken
into account.  

             
             C.
       Should an  outstanding  option  under this Plan expire or  terminate  for any
reason  prior to exercise in full,  the shares  subject to the portion of the option not
so exercised shall be available for subsequent option grant under the Plan. Unvested
shares issued under the Plan and subsequently repurchased by the Corporation, at the
original issue price paid per share, pursuant to the Corporation’s repurchase rights
under the Plan shall be added back to the number of shares of Common Stock reserved for
issuance under the Plan and shall accordingly be available for reissuance through one or
more subsequent option grants under the Plan. However, should the exercise price of an
outstanding option under the Plan be paid with shares of Common Stock or should shares of
Common Stock otherwise issuable under the Plan be withheld by the Company in satisfaction
of the withholding taxes incurred in connection with the exercise of an outstanding
option under the Plan, then the number of shares of Common Stock available for issuance
under the Plan shall be reduced by the gross number of shares for which the option is
exercised, and not by the net number of shares of Common Stock actually issued to the
option holder.  

             
             D.
       In the event any change is made to the Common Stock issuable under the Plan by
reason of any stock split,  stock  dividend,  recapitalization,  combination of shares,
exchange of shares or other change affecting the outstanding Common Stock as a class
without receipt of consideration, then appropriate adjustments shall be made to (i) the
maximum number and/or class of securities issuable under the Plan, (ii) the maximum
number and/or class of securities for which any one individual participating in the Plan
may be granted stock options under the Plan from and after the Section 12(g)
Registration Date, (iii) the number and/or class of securities and price per share in
effect under each outstanding option under the Plan, and (iv) the number and/or
class of securities for which automatic option grants are subsequently to be made per
non-employee Board member under the Automatic Option Grant Program. The purpose of such
adjustments to the outstanding options shall be to preclude the enlargement or dilution
of rights and benefits under such options.  

27 

ARTICLE TWO
DISCRETIONARY
OPTION GRANT PROGRAM 

I. TERMS AND CONDITIONS
OF OPTIONS

             
             Options
granted  pursuant to this Article Two shall be authorized by action of the Plan
 Administrator  and may, at the Plan  Administrator’s  discretion,  be either
Incentive Options or non-statutory  options.  Individuals who are not Employees may only
be granted  non-statutory  options under this Article Two. Each option granted shall be
evidenced by one or more  instruments  in the form approved by the Plan  Administrator.
 Each such  instrument  shall,  however,  comply with the terms and  conditions
 specified  below,  and each instrument evidencing an Incentive Option shall, in
addition, be subject to the applicable provisions of Section II of this Article Two. 

             
             A.
Option Price. 

             
             
             1.
        The option price per share shall be fixed by the Plan  Administrator.  In no
event,  however,  shall the option price per share be less than one hundred percent
(100%) of the fair market value per share of Common Stock on the date of the option
grant.  

             
             
             2.
        The option price shall become immediately due upon exercise of the option and
shall,  subject to the provisions of Section V of this Article Two and the instrument
evidencing the grant, be payable as follows: 

	 	             
             
             -
        full payment in cash or check drawn to the Company’s order;

	 	             
             
             -
        full payment in shares of Common Stock held by the optionee  for the  requisite
 period  necessary to avoid a charge to the            Company’s earnings for
financial reporting purposes and valued at fair market value on the Exercise Date (as
such term is defined below);

	 	             
             
             -
        full payment  through a combination  of shares of Common Stock held by the
optionee for the requisite  period  necessary to            avoid a charge to the Company’s
earnings for financial reporting purposes and valued at fair market value on the Exercise
Date and cash or cash equivalent; or

	 	             
             
             -
        full payment  through a  broker-dealer  sale and  remittance  procedure  pursuant
to which the optionee  (I) shall  provide            irrevocable  written  instructions
 to a designated  brokerage firm to effect the immediate sale of the purchased  shares
and remit to the Company,  out of the sale            proceeds  available on the
settlement date,  sufficient  funds to cover the aggregate option price payable for the
purchased shares plus all applicable  Federal and            State income and employment
taxes required to be withheld by the Company in connection with such purchase and (II)
shall  provide written  directives to the Company            to deliver the certificates
for the purchased shares directly to such brokerage firm in order to complete the sale
transaction.

             
             For
purposes of this  subparagraph 2, the Exercise Date shall be the date on which written
notice of the option  exercise is delivered to the  Corporation. Except to the extent the
sale and remittance procedure is utilized in connection with the exercise of the option,
payment of the option price for the purchased shares must accompany such notice.  

             
             3.
        The fair market  value per share of Common  Stock on any relevant  date under the
Plan shall be  determined  in  accordance  with the  following provisions: 

	 	             
             
             -
        If the Common Stock is not at the time listed or admitted to trading on any
national  securities  exchange but is traded in            the  over-the-counter  market,
 the fair market value shall be the mean between the highest bid and lowest asked prices
(or, if such  information is available,  the            closing selling price) per share
of Common Stock on the date in question in the over-the-counter  market, as such prices
are reported by the National Association of            Securities  Dealers  through the
Nasdaq National  Market or any successor  system.  If there are no reported bid and asked
prices (or closing selling price) for the            Common Stock on the date in
question,  then the mean between the highest bid price and lowest asked price (or the
closing  selling price) on the last preceding date            for which such quotations
exist shall be determinative of fair market value.

28 

	 	             
             
             -
        If the Common Stock is at the time listed or admitted to trading on any national
securities exchange,  then the fair market            value shall be the closing selling
price per share of Common Stock on the date in question on the securities  exchange
 determined by the Plan  Administrator  to be            the primary market for the
Common Stock, as such price is officially  quoted in the composite tape of  transactions
 on such exchange.  If there is no reported sale            of Common Stock on the
exchange on the date in question,  then the fair market value shall be the closing
 selling price on the exchange on the last  preceding date            for which such
quotation exists.

	 	             
             
             -
         If the Common Stock is at the time neither  listed nor  admitted to trading on
any  securities  exchange nor traded in the            over-the-counter  market,  then
the fair market value shall be determined by the Plan Administrator after taking into
account such factors as the Plan Administrator            shall deem appropriate.

             
             B.
Term and Exercise of Options. 

             
             
             Each
option  granted  under this Article Two shall be  exercisable  at such time or times,
 during such  period,  and for such number of shares as shall be determined by the Plan
 Administrator  and set forth in the instrument  evidencing the option grant. No such
option,  however,  shall have a maximum term in excess of ten (10) years from the grant
date. During the lifetime of the optionee,  the option,  together with any stock
 appreciation  rights pertaining to such option,  shall be exercisable only by the
optionee and shall not be assignable or transferable by the optionee except for a
transfer of the option by will or by the laws of descent and distribution  following the
optionee’s  death.  However, the Plan  Administrator  shall have the discretion to
provide that a non-statutory  option may, in connection with the optionee’s  estate
plan, be assigned in whole or in part during the optionee’s  lifetime  either as (i)
as a gift to one or more members of optionee’s  immediate  family,  to a trust in
which optionee and/or one or more such family members hold more than fifty percent (50%)
of the beneficial  interest or an entity in which more than fifty percent (50%) of the
voting  interests are owned by optionee and/or one or more such family members, or (ii)
pursuant to a domestic  relations  order.  The assigned  portion shall be exercisable
 only by the person or persons who acquire a proprietary  interest in the option pursuant
to such assignment.  The terms applicable to the assigned  portion shall be the same as
those in effect for this option  immediately  prior to such assignment and shall be set
forth in such documents issued to the assignee as the Plan Administrator may deem
appropriate. 

             
             C.
Termination of Service. 

             
             
             1.
        Except to the extent otherwise  provided  pursuant to Section VI of this Article
Two, the following  provisions shall govern the exercise period applicable to any options
held by the optionee at the time of cessation of Service or death. 

	 	             
             
             -
        Should the optionee  cease to remain in Service for any reason other than death
or  permanent  disability,  then the period            for which each  outstanding
 option  held by such  optionee is to remain  exercisable  shall be limited to the three
 (3)-month  period  following  the date of such            cessation of Service.
 However,  should optionee die during the three (3)-month period following his or her
cessation of service, the personal representative of the            optionee’s
 estate or the  person or persons to whom the option is  transferred  pursuant  to the
 optionee’s  will or in  accordance  with the laws of descent  and
           distribution shall have a twelve (12)-month period following the date of the
optionee’s death during which to exercise such option.

	 	             
             
             -
         In the event such  Service  terminates  by reason of  permanent  disability  (as
defined in Section  22(e)(3) of the  Internal  Revenue  Code),  then the period for which
each            outstanding option held by the optionee is to remain exercisable shall be
limited to the twelve (12)-month period following the date of such cessation of Service.

29 

	 	             
             
             -
         Should the  optionee,  after  completing  five (5) full years of  service,  die
while in Service,  then the  exercisability  of each of his or her  outstanding  options
 shall            automatically  accelerate so that each such option shall become fully
 exercisable with respect to the total number of shares of Common Stock at the time
subject to            such option and may be exercised for all or any portion of such
shares.  The personal  representative  of the optionee’s estate or the person or
persons to whom the            option is transferred  pursuant to the optionee’s
will or in accordance with the laws of descent and distribution  shall have a twelve
 (12)-month  period following            the date of the optionee’s death during
which to exercise such option.

	 	             
             
             -
        In the event such service  terminates  by reason of death prior to the optionee
 obtaining  five (5) full years of service,            then the period for which each
 outstanding  vested option held by the optionee at the time of death shall be
exercisable by the optionee’s  estate or the person or            persons to whom
the option is transferred  pursuant to the optionee’s  will shall be limited to the
twelve  (12)-month  period  following the date of the optionee’s            death.

	 	             
             
             -
        Under no circumstances,  however,  shall any such option be exercisable  after
the specified  expiration date of the option            term.

	 	             
             
             -
        Each such option shall,  during such limited  exercise  period,  be exercisable
 for any or all of the shares for which the option is exercisable on the date of the
optionee’s cessation of Service. Upon the expiration of such limited exercise period
or (if earlier) upon the expiration of the option term, the option shall terminate and
cease to be exercisable. However, each outstanding option shall immediately terminate and
cease to remain outstanding, at the time of the optionee’s cessation of Service,
with respect to any shares for which the option is not otherwise at that time exercisable
or in which the optionee is not otherwise vested. 

	 	             
             
             -
        Should (i) the  optionee’s  Service be terminated  for  misconduct
 (including,  but not limited to, any act of dishonesty,            willful misconduct,
 fraud or embezzlement) or (ii) the optionee make any unauthorized use or disclosure of
confidential information or trade secrets of the Company            or its parent or
subsidiary  corporations,  then in any such event all outstanding  options held by the
optionee under this Article Two shall terminate  immediately            and cease to be
exercisable.

             
             
             2.
        The Plan  Administrator  shall have complete  discretion,  exercisable  either at
the time the option is granted or at any time while the option remains outstanding, to
permit one or more options held by the optionee under this Article Two to be exercised,
during the limited period of exercisability provided under subparagraph 1 above, not only
with respect to the number of shares for which each such option is exercisable at the
time of the optionee’s cessation of Service but also with respect to one or more
subsequent installments of purchasable shares for which the option would otherwise have
become exercisable had such cessation of Service not occurred.  

             
             
             3.
        For purposes of the foregoing provisions of this Section I.C (and for all other
purposes under the Plan): 

	 	             
             
             -
        The optionee shall be deemed to remain in the Service of the Company for so long
as such individual  renders  services on a            periodic  basis to the Company (or
any parent or  subsidiary  corporation)  in the capacity of an Employee,  a  non-employee
 member of the board of directors or an            independent consultant or advisor,
unless the agreement evidencing the applicable option grant specifically states otherwise.

	 	             
             
             -
        The optionee shall be considered to be an Employee for so long as such
 individual  remains in the employ of the Company or            one or more of its parent
or subsidiary  corporations,  subject to the control and direction of the employer entity
not only as to the work to be performed but also            as to the manner and method
of performance.

30 

             
             D.
Stockholder Rights. 

             
             
             An
optionee shall have no stockholder  rights with respect to any shares  covered by the
option until such  individual  shall have exercised the option and paid the option price
for the purchased shares. 

             
             E.
Repurchase Rights. 

             
             
             The
shares of Common Stock  acquired upon the exercise of options  granted under this Article
Two may be subject to repurchase by the Company in accordance with the following
provisions: 

	 	             
             
             (a)
      The Plan  Administrator  shall have the discretion to authorize the issuance of
unvested  shares of Common Stock under this            Article Two. Should the optionee
cease Service while holding such unvested  shares,  the Company shall have the right to
repurchase any or all those unvested shares            at the option price paid per
share.  The terms and  conditions  upon which such  repurchase  right shall be
 exercisable  (including  the period and  procedure  for            exercise and the
appropriate  vesting schedule for the purchased shares) shall be established by the Plan
 Administrator and set forth in the instrument  evidencing            such repurchase
right.

	 	             
             
             (b)
      All of the  Company’s  outstanding  repurchase  rights  shall  automatically
 terminate,  and all  shares  subject  to such            terminated rights shall
immediately vest in full, upon the occurrence of any Corporate  Transaction under Section
III of this Article Two, except to the extent: (i)            any such  repurchase  right
is expressly  assigned to the successor  corporation  (or parent  thereof) in connection
 with the  Corporate  Transaction  or (ii) such            termination is precluded by
other limitations imposed by the Plan Administrator at the time the repurchase right is
issued.

	 	             
             
             (c)
      The Plan Administrator shall have the discretionary authority,  exercisable either
before or after the optionee’s cessation            of Service,  to cancel the
 Corporation’s  outstanding  repurchase  rights with respect to one or more shares
 purchased or  purchasable  by the optionee under this            Discretionary Option
Grant Program and thereby accelerate the vesting of such shares in whole or in part at
any time.

II. INCENTIVE OPTIONS

             
             The
terms and  conditions  specified  below shall be applicable to all Incentive  Options
 granted under this Article Two.  Incentive  Options may only be granted to individuals
 who are Employees of the Company.  Options which are  specifically  designated as  “non-statutory”  options
when issued under the Plan shall not be subject to such terms and conditions. 

	 	             
             A.
        Dollar  Limitation.  The aggregate fair market value (determined as of the
respective date or dates of grant) of the Common Stock for            which one or more
options  granted to any  Employee  after  December  31, 1986 under this Plan (or any
other option plan of the Company or its parent or  subsidiary            corporations)
may for the first time become  exercisable as incentive stock options under the Federal
tax laws during any one calendar year shall not exceed the sum            of One Hundred
 Thousand  Dollars  ($100,000).  To the extent the Employee  holds two or more such
options which become  exercisable  for the first time in the same            calendar
year, the foregoing  limitation on the  exercisability  of such options as incentive
stock options under the Federal tax laws shall be applied on the basis            of the
order in which such options are  granted.  Should the number of shares of Common  Stock
for which any  Incentive  Option  first  becomes  exercisable  in any            calendar
year exceed the applicable One Hundred Thousand Dollar ($100,000) limitation,  then that
option may nevertheless be exercised in such calendar year for the            excess
number of shares as a non-statutory option under the Federal tax laws.

	 	             
             B.
        10%  Stockholder.  If any individual to whom an Incentive Option is granted is
the owner of stock (as determined under Section 424(d)            of the  Internal
 Revenue  Code)  possessing  10% or more of the total  combined  voting  power of all
 classes of stock of the  Company or any one of its parent or            subsidiary
 corporations,  then the option  price per share shall not be less than one hundred and
ten percent  (110%) of the fair market  value per share of Common            Stock on the
grant date, and the option term shall not exceed five (5) years, measured from the grant
date.

31 

             
             Except
as modified by the  preceding  provisions of this Section II, the  provisions  of
Articles One, Two and Four of the Plan shall apply to all Incentive  Options granted
hereunder. 

III. CORPORATE
TRANSACTIONS/CHANGES IN CONTROL

             
             A.
 In the event of any of the following stockholder-approved transactions (a “Corporate
Transaction”): 

	 	             
             
             (i)
      a merger or consolidation in which the Company is not the surviving entity,  except
for a transaction the principal purpose            of which is to change the State of the
Company’s incorporation,

	 	             
             
             (ii)
     the sale,  transfer  or other  disposition  of all or  substantially  all of the
assets of the  Company in  liquidation  or            dissolution of the Company, or

	 	             
             
             (iii)
    any reverse merger in which the Company is the surviving entity but in which
securities  possessing more than fifty percent            (50%) of the total combined
voting power of the Company’s  outstanding  securities are  transferred to a person
or persons  different from the persons holding those            securities immediately
prior to such merger,

             
             then
the exercisability of each option  outstanding under this Article Two shall
 automatically  accelerate so that each such option shall,  immediately prior to the
specified  effective date for the Corporate  Transaction,  become fully  exercisable with
respect to the total number of shares of Common Stock at the time subject to such option
and may be exercised for all or any portion of such shares.  However,  an outstanding
 option under this Article Two shall not so accelerate if and to the extent the
 acceleration of such option is subject to other limitations imposed by the Plan
Administrator at the time of grant. 

             
             B.
       Immediately  after the  consummation  of the  Corporate  Transaction,  all
 outstanding  options  under this  Article Two shall  terminate  and cease to be
outstanding, except to the extent assumed by the successor corporation or its parent
company. 

             
             C.
       Each  outstanding  option under this Article Two which is assumed in connection
with the Corporate  Transaction or is otherwise to continue in effect shall be
appropriately adjusted, immediately after such Corporate Transaction, to apply and
pertain to the number and class of securities which would have been issued to the option
holder, in consummation of such Corporate Transaction, had such person exercised the
option immediately prior to such Corporate Transaction. Appropriate adjustments shall
also be made to the option price payable per share, provided the aggregate option
price payable for such securities shall remain the same. In addition, the class and
number of securities available for issuance under the Plan following the consummation of
the Corporate Transaction shall be appropriately adjusted.  

             
             D.
       The grant of options  under this Article Two shall in no way affect the right of
the Company to adjust,  reclassify,  reorganize  or  otherwise  change its capital or
business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all
or any part of its business or assets.  

             
             E.
       The  exercisability of each outstanding  option under this Article Two shall
 automatically  accelerate,  and the Company’s  outstanding  repurchase rights under
this Article Two shall immediately terminate upon the occurrence of a Change in Control.  

             
             F.
       For purposes of this Section III, a Change in Control shall be deemed to occur in
the event: 

	 	             
             
             (i)
      any person or related  group of persons  (other than the  Company or a person that
 directly  or  indirectly  controls,  is            controlled by, or is under common
control with, the Company)  directly or indirectly  acquires  beneficial  ownership
 (within the meaning of Rule 13d-3 of the 1934            Act) of securities  possessing
 more than fifty percent (50%) of the total combined  voting power of the Company’s
 outstanding  securities  pursuant to a tender or            exchange offer made directly
to the Company’s stockholders; or

32 

	 	             
             
             (ii)
     there is a change in the composition of the Board over a period of twenty-four (24)
consecutive  months or less such that a            majority of the Board members (rounded
up to the next whole number) ceases, by reason of one or more contested  elections for
Board  membership,  to be comprised of            individuals  who either (A) have been
Board  members  continuously  since the  beginning of such period or (B) have been
elected or nominated  for election as Board            members during such period by at
least two-thirds of the Board members  described in clause (A) who were still in office
at the time such election or nomination was            approved by the Board.

             
             G.
       All options  accelerated in connection with the Change in Control shall remain
fully exercisable  until the expiration or sooner  termination of the option term. 

             
             H.
       The portion of any  Incentive  Option  accelerated  under this Section III in
 connection  with a Corporate  Transaction  or Change in Control shall remain exercisable
as an incentive stock option under the Federal tax laws only to the extent the dollar
limitation of Section II of this Article Two is not exceeded. To the extent such dollar
limitation is exceeded, the accelerated portion of such option shall be exercisable as a
non-statutory option under the Federal tax laws.  

IV. STOCK
APPRECIATION RIGHTS

             
             A.
       Provided and only if the Plan  Administrator  determines in its discretion to
implement the stock  appreciation right provisions of this Section IV, one or more
optionees may be granted the right, exercisable upon such terms and conditions as the
Plan Administrator may establish, to surrender all or part of an unexercised option under
this Article Two in exchange for a distribution from the Company in an amount equal to
the excess of (i) the fair market value (on the option surrender date) of the number of
shares in which the optionee is at the time vested under the surrendered option (or
surrendered portion thereof) over (ii) the aggregate option price payable for such vested
shares.  

             
             B.
       No  surrender of an option  shall be  effective  hereunder  unless it is approved
by the Plan  Administrator.  If the  surrender  is so approved,  then the distribution to
which the optionee shall accordingly become entitled under this Section IV may be made in
shares of Common Stock valued at fair market value on the option surrender date, in cash,
or partly in shares and partly in cash, as the Plan Administrator shall in its sole
discretion deem appropriate.  

             
             C.
       If the  surrender  of an option is  rejected  by the Plan  Administrator,  then
the  optionee  shall  retain  whatever  rights the  optionee  had under the surrendered
option (or surrendered portion thereof) on the option surrender date and may exercise
such rights at any time prior to the later of (i) five (5) business days after the
receipt of the rejection notice or (ii) the last day on which the option is otherwise
exercisable in accordance with the terms of the instrument evidencing such option, but in
no event may such rights be exercised more than ten (10) years after the date of the
option grant.  

             
             D.
       One or more officers of the Company subject to the short-swing  profit
 restrictions of the Federal securities laws may, in the Plan  Administrator’s  sole
discretion, be granted limited stock appreciation rights in tandem with their outstanding
options under this Article Two. Upon the occurrence of a Hostile Take-Over effected at
any time after the Company’s outstanding Common Stock is registered under Section
12(g) of the 1934 Act, the officer shall have a thirty (30)-day period in which he or she
may surrender any outstanding options with such a limited stock appreciation right, to
the extent such option is at the time exercisable for fully vested shares of Common
Stock. The officer shall in return be entitled to a cash distribution from the Company in
an amount equal to the excess of (i) the Take-Over Price of the vested shares of Common
Stock at the time subject to each surrendered option (or surrendered portion of such
option) over (ii) the aggregate exercise price payable for those vested shares. The cash
distribution shall be made within five (5) days following the date the option is
surrendered to the Company, and neither the approval of the Plan Administrator nor the
consent of the Board shall be required in connection with the option surrender and cash
distribution. Any unsurrendered portion of the option shall continue to remain
outstanding and become exercisable in accordance with the terms of the instrument
evidencing such grant.  

             
             E.
       For purposes of Section IV.D, the following definitions shall be in effect: 

	 	             
             
             -
        A Hostile  Take-Over  shall be deemed to occur in the event any person or related
group of persons  (other than the Company            or a person that directly or
indirectly  controls,  is controlled  by, or is under common  control with,  the Company)
 directly or indirectly  acquires  beneficial            ownership  (within the meaning
of Rule 13d-3 of the 1934 Act, as amended) of securities  possessing more than fifty
percent (50%) of the total combined voting power            of the Company’s
outstanding  securities pursuant to a tender or exchange offer made directly to the
Company’s  stockholders which the Board does not recommend such
           stockholders to accept.

33 

	 	             
             
             -
        The  Take-Over  Price per share shall be deemed to be equal to the  greater of
(a) the fair  market  value per share on the            option surrender date, as
determined pursuant to the valuation  provisions of Section I.A.3 of this Article Two, or
(b) the highest reported price per share paid in            effecting such Hostile
Take-Over.  However, if the surrendered option is an Incentive Option, the Take-Over
Price shall not exceed the clause (a) price per share.

             
             F.
       The shares of Common Stock  subject to any option  surrendered  for an
 appreciation  distribution  pursuant to this Section IV shall not be available  for
subsequent option grant under the Plan. 

V. LOANS OR GUARANTEE OF
LOANS

             
             The
Plan Administrator may assist any optionee  (including any officer) in the exercise of
one or more outstanding  options under this Article Two by (a) authorizing the extension
of a loan to such optionee from the Company,  (b) permitting the optionee to pay the
option price for the purchased  Common Stock in installments  over a period of years or
(c)  authorizing a guarantee by the Company of a third-party  loan to the optionee.  The
terms of any loan,  installment  method of payment or guarantee  (including the interest
rate and terms of repayment) will be established by the Plan  Administrator  in its sole
 discretion.  Loans,  installment  payments and guarantees may be granted  without
 security or collateral (other than to optionees who are  consultants or independent
 contractors,  in which event the loan must be adequately  secured by collateral  other
than the purchased  shares),  but the maximum  credit  available to the optionee  shall
not exceed the sum of (i) the  aggregate  option price (less par value) of the purchased
 shares plus (ii) any Federal,  State and local income and employment tax liability
incurred by the optionee in connection with the exercise of the option. 

VI. EXTENSION
OF EXERCISE PERIOD

             
             The
Plan  Administrator  shall  have full  power and  authority,  exercisable  either at the
time the  option is  granted  or at any time  while the  option  remains outstanding,  to
extend the period of time for which any option granted under this Article Two is to
remain  exercisable  following the optionee’s  cessation of Service or death from
the limited period in effect under Section I.C.1 of this Article Two to such greater
period of time as the Plan  Administrator  shall deem appropriate;  provided,  however,
 that in no event shall such option be exercisable after the specified expiration date of
the option term. 

34 

ARTICLE THREE
AUTOMATIC
OPTION GRANT PROGRAM 

I. ELIGIBILITY

Persons Eligible.
The individuals eligible to receive automatic option grants pursuant to the
provisions of this Article Three program shall be (i) those individuals who, on
or after March 8, 2004, first become non-employee Board members, whether through
appointment by the Board or election by the Company’s stockholders, or by
continuing to serve as a Board member after ceasing to be employed by the
Company and (ii) those individuals serving as non-employee Board members on
March 8, 2004, including individuals who first became non-employee Board members
prior to March 8, 2004 or who have otherwise not been in the employ of the
Company. As used herein, a “non-employee” Board member is any Board
member who is not employed by the Company on the date in question. 

II.       TERMS AND
CONDITIONS OF AUTOMATIC OPTION GRANTS

     
        A.
Grants. On or after March 8, 2004, option grants shall be made under this Article Three
as follows: 

             
             1.
Initial  Grant.  Each  individual  who first becomes a  non-employee  Board member on or
after March 8, 2004 through  appointment by the Board or by continuing to serve as a
Board member after ceasing to be employed by the Company, shall automatically be granted
at the time of such initial appointment or upon ceasing to be employed by the Company, a
non-statutory stock option to purchase a number shares of Common Stock equal to the
product obtained by multiplying (i) a fraction, the numerator of which is the number of
months (rounded to the nearest whole month) remaining between the date such Board member
first became a non-employee Board member and the next annual meeting date of the
stockholders of the Company and the denominator of which is 12 by (ii) 10,000 share of
Common Stock of the Company, upon the terms and conditions of this Article Three.  

             
             2.
 Annual  Grants.  Each  individual  who is elected to serve as a  non-employee  Board
 member at, or who is to continue to serve as a  non-employee  Board  member following,
each Annual Stockholders Meeting shall automatically be granted an additional
non-statutory stock option under this Article Three, to acquire 10,000 shares of Common
Stock, immediately following each such Annual Stockholders Meeting.  

     
        B.
Exercise  Price.  The exercise price per share of each automatic  option grant made under
this Article Three shall be equal to one hundred percent (100%) of the fair market value
per share of Common Stock on the automatic grant date. 

     
        C.
Payment. The exercise price shall be payable in one of the alternative forms specified
below: 

             
             (i)
 full payment in cash or check made payable to the Company’s order; or 

             
             (ii)
full payment in shares of Common Stock held for the requisite  period necessary to avoid
a charge to the Company’s  reported  earnings and valued at fair market value on the
Exercise Date (as such term is defined below); or 

             
             (iii)
full payment in a  combination  of shares of Common Stock held for the requisite  period
 necessary to avoid a charge to the  Company’s  reported  earnings and valued at
fair market value on the Exercise Date and cash or check payable to the Company’s
order; or 

             
             (iv)
full payment through a sale and remittance  procedure pursuant to which the non-employee
Board member (I) shall provide  irrevocable  written  instructions to a designated
 brokerage firm to effect the immediate sale of the purchased shares and remit to the
Company,  out of the sale proceeds available on the settlement date,  sufficient funds to
cover the aggregate  exercise price payable for the purchased shares and shall (II)
concurrently  provide written  directives to the Company to deliver the certificates for
the purchased shares directly to such brokerage firm in order to complete the sale
transaction. 

     
        For
purposes of this  subparagraph  C, the Exercise  Date shall be the date on which  written
 notice of the option  exercise is delivered to the Company,  and the fair market value
per share of Common Stock on any  relevant  date shall be  determined  in  accordance
 with the  provisions  of Section  I.A.(3) of Article  Two.  Except to the extent the
sale and remittance procedure specified above is utilized for the exercise of the option,
payment of the option price for the purchased shares must accompany the exercise notice. 

35 

     
        D.
Option Term. Each automatic grant under this Article Three shall have a term of ten (10)
years measured from the automatic grant date. 

     
        E.
Exercisability. 

             
             1.
Each initial  automatic  grant made pursuant to Section  II.A.1 of this Article Three
shall vest over the period to the Annual  Stockholders  Meeting  immediately following
the grant with a pro rata portion of such automatic grant vesting at the end of each
calendar month during such period and with the final portion of such grant vesting on the
date of such Annual Stockholders Meeting. The option shall not become exercisable for any
additional option shares following the optionee’s cessation of Board service for any
reason.  

             
             2.
Each 10,000 share automatic  grant made pursuant to Section II.A.2 of this Article Three
on the date of an Annual  Stockholders  Meeting shall become  exercisable for 1/12th of
the option shares upon the optionee’s completion of each month of Board service over
the twelve (12)-month period measured from the automatic grant date. The option shall not
become exercisable for any additional option shares following the optionee’s
cessation of Board service for any reason.  

     
        F.
 Non-Transferability.  During the lifetime of the optionee,  each automatic option,
 together with the limited stock appreciation right pertaining to such option,  shall be
exercisable  only by the optionee and shall not be  assignable  or  transferable  by the
optionee  except for a transfer of the option by will or by the laws of descent and
 distribution following the optionee’s  death.  However,  the Plan  Administrator
 shall have the discretion to provide that an automatic option may, in connection with
the optionee’s  estate plan, be assigned in whole or in part during the during
 optionee’s  lifetime either as (i) as a gift to one or more members of optionee’s
 immediate  family,  to a trust in which optionee and/or one or more such family  members
hold more than fifty percent (50%) of the  beneficial  interest or an entity in which
more than fifty percent (50%) of the voting  interests are owned by optionee and/or one
or more such family members,  or (ii) pursuant to a domestic  relations  order.  The
assigned portion shall be exercisable only by the person or persons who acquire a
proprietary  interest in the option pursuant to such assignment.  The terms applicable to
the assigned portion shall be the same as those in effect for this option  immediately
 prior to such assignment and shall be set forth in such documents issued to the assignee
as the Plan Administrator may deem appropriate. 

     
        G.
Cessation of Board Service. 

             
             1.
Should the  optionee  cease to serve as a Board member for any reason while  holding one
or more  automatic  option  grants  under this Article  Three,  then such optionee shall
have the remainder of the ten (10) year term of each such option in which to exercise
each such option for any or all of the shares of Common Stock for which the option is
exercisable at the time of such cessation of Board service. Each such option shall
immediately terminate and cease to be outstanding, at the time of such cessation of Board
service, with respect to any shares for which the option is not otherwise at that time
exercisable. Upon the expiration of the ten (10)-year option term, the automatic grant
shall terminate and cease to be outstanding for any unexercised shares for which the
option was exercisable at the time of the optionee’s cessation of Board service.
Upon the death of the optionee, whether before or after cessation of Board service, any
option held by optionee at the time of optionee’s death may be exercised, for any or
all of the shares of Common Stock for which the option was exercisable at the time of
cessation of Board service by the optionee and which have not been theretofore exercised
by the optionee, by the personal representative of the optionee’s estate or by the
person or persons to whom the option is transferred pursuant to the optionee’s will
or in accordance with the laws of descent and distribution. Any such exercise must occur
during the reminder of the ten (10) year term of such option.  

             
             2.
The provisions of this  subparagraph  G shall be applicable to all options  granted
 pursuant to Article Three of the Plan which are  outstanding on March 8, 2004 and to all
options thereafter granted under this Article Three. 

36 

ARTICLE FOUR

MISCELLANEOUS

I. AMENDMENT
OF THE PLAN

The Board shall have
complete and exclusive power and authority to amend or modify the Plan in any or
all respects whatsoever. However, no such amendment or modification shall,
without the consent of the holders, adversely affect rights and obligations with
respect to options at the time outstanding under the Plan. In addition, certain
amendments may require stockholder approval pursuant to applicable laws or
regulations. 

II. TAX
WITHHOLDING

             
             A.
       The  Company’s  obligation  to deliver  shares or cash upon the exercise of
stock  options or stock  appreciation  rights  granted  under the Plan shall be subject
to the satisfaction of all applicable Federal, State and local income and employment tax
withholding requirements.  

             
             B.
       The Plan  Administrator  may, in its  discretion and upon such terms and
 conditions as it may deem  appropriate  provide any or all holders of outstanding option
grants under the Plan (other than the automatic option grants under Article Three) with
the election to have the Company withhold, from the shares of Common Stock otherwise
issuable upon the exercise of such options, a portion of such shares with an aggregate
fair market value equal to the designated percentage (any multiple of 5% specified by the
optionee) of the Federal, State and local income and employment taxes (the “Taxes”)
incurred in connection with the acquisition of such shares. In lieu of such direct
withholding, one or more optionees may also be granted the right to deliver shares of
Common Stock to the Company in satisfaction of such Taxes. Any withheld or delivered
shares shall be valued at their fair market value on the applicable determination date
for such Taxes.  

III. EFFECTIVE
DATE AND TERM OF PLAN

             
             A.
       The Plan, as restated and amended in this  document,  became  effective on the
 Effective  Date set forth in Section I.C of Article One. Each option issued and
outstanding under the Plan immediately prior to such Effective Date shall continue to be
governed solely by the terms and conditions of the agreement evidencing such grant, and
nothing in this restatement of the Plan shall be deemed to affect or otherwise modify the
rights or obligations of the holders of such options with respect to their acquisition of
shares of Common Stock thereunder. The Plan Administrator shall, however, have full power
and authority, under such circumstances as the Plan Administrator may deem appropriate,
to extend one or more features of this restatement to any options outstanding on the
Effective Date.  

             
             B.
       The sale and remittance  procedure  authorized for the exercise of outstanding
options under the Plan shall be available for all options granted under this Plan on or
after November 22, 1991 (the date of initial adoption of the Plan) and for all
non-statutory options outstanding under the 1990 Stock Option Plan and incorporated into
this Plan. The Plan Administrator may also allow such procedure to be utilized in
connection with one or more disqualifying dispositions of Incentive Option shares
effected after November 22, 1991, whether such Incentive Options were granted under this
Plan or the 1990 Stock Option Plan.  

             
             C.
       Unless sooner  terminated in accordance  with Section III of Article Two, the Plan
shall  terminate  upon the earlier of (i) March 6, 2010 or (ii) the date on which all
shares available for issuance under the Plan shall have been issued or cancelled pursuant
to the exercise, surrender or cash-out of the options granted hereunder. If the date of
termination is determined under clause (i) above, then any options outstanding on such
date shall continue to have force and effect in accordance with the provisions of the
agreements evidencing those options.  

             
             D.
       Options may be granted under the Plan to purchase  shares of Common Stock in
excess of the number of shares at the time  available  for issuance,  provided each
granted option is not to become exercisable, in whole or in part, at any time prior to
stockholder approval of an amendment authorizing a sufficient increase in the number of
shares issuable under the Plan.  

IV. USE OF
PROCEEDS

             
             Any
cash proceeds received by the Company from the sale of shares pursuant to options granted
under the Plan shall be used for general corporate purposes. 

37 

V. REGULATORY
APPROVALS

             
             The
 implementation of the Plan, the granting of any option  hereunder,  and the issuance of
stock upon the exercise or surrender of any such option shall be subject to the
procurement by the Company of all approvals and permits required by regulatory
 authorities  having  jurisdiction  over the Plan, the options granted under it and the
stock issued pursuant to it. 

VI. NO
EMPLOYMENT/SERVICE RIGHTS

             
             Neither
the action of the Company in  establishing  or restating the Plan, nor any action taken
by the Plan  Administrator  hereunder,  nor any provision of the Plan shall be  construed
 so as to grant any  individual  the right to remain in the employ or service of the
 Company  (or any parent or  subsidiary  corporation)  for any period of specific
duration,  and the Company (or any parent or subsidiary  corporation retaining the
services of such individual) may terminate such individual’s  employment or service
at any time and for any reason, with or without cause. 

VII.
MISCELLANEOUS PROVISIONS

             
             A.
       Except to the extent  otherwise  expressly  provided in the Plan,  the right to
acquire  Common  Stock or other  assets under the Plan may not be assigned, encumbered or
otherwise transferred by any optionee. 

             
             B.
       The  provisions  of the Plan  relating to the exercise of options and the vesting
of shares  shall be governed by the laws of the State of Alabama  without resort to that
state’s conflict-of-laws provisions, as such laws are applied to contracts entered
into and performed in such State.  

38

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