<SUBMISSION>
<ACCESSION-NUMBER>0000950134-06-022109
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>2
<PERIOD>20061117
<ITEMS>1.01
<ITEMS>9.01
<FILING-DATE>20061122
<DATE-OF-FILING-DATE-CHANGE>20061122
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>bebe stores, inc.
<CIK>0001059272
<ASSIGNED-SIC>2330
<IRS-NUMBER>942450490
<STATE-OF-INCORPORATION>CA
<FISCAL-YEAR-END>0702
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>000-24395
<FILM-NUMBER>061236101
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>400 VALLEY DR
<CITY>BRISBANE
<STATE>CA
<ZIP>94005
<PHONE>4157153900
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>400 VALLEY DR
<CITY>BRISBANE
<STATE>CA
<ZIP>94005
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>BEBE STORES INC
<DATE-CHANGED>19980422
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>BABE INC
<DATE-CHANGED>19980407
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>f25408e8vk.htm
<DESCRIPTION>FORM 8-K
<TEXT>
<HTML>
<HEAD>
<TITLE>e8vk</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 1pt solid black; font-size: 1pt">&nbsp;</DIV>






<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><B>UNITED STATES SECURITIES AND EXCHANGE COMMISSION</B>
</DIV>

<DIV align="center" style="font-size: 12pt"><B>Washington, D.C. 20549</B>
</DIV>

<DIV align="center" style="font-size: 12pt"><B><DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV></B>
</DIV>

<DIV align="center" style="font-size: 18pt; margin-top: 12pt"><B>Form&nbsp;8-K</B>
</DIV>


<DIV align="center" style="font-size: 12pt; margin-top: 12pt"><B>CURRENT REPORT<BR>
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934</B>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>Date of report (date of earliest event reported):<BR>
November&nbsp;17, 2006</B></DIV>

<DIV align="center" style="font-size: 24pt; margin-top: 12pt"><B>bebe stores, inc.</B>
</DIV>

<DIV align="center" style="font-size: 10pt">(Exact name of registrant as specified in its charter)</DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>California</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>0-24395</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>94-2450490</B></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">(State or other jurisdiction <BR>
of incorporation)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(Commission File No.)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(I.R.S. Employer<BR>
Identification No.)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>400 Valley Drive<BR>
Brisbane, CA 94005</B><BR>
(Address of principal executive offices)</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt">Registrant&#146;s telephone number, including area code:<BR>
<B>(415)&nbsp;715-3900</B></DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> Written communications pursuant to Rule&nbsp;425 under the Securities Act (17 CFR 230.425)
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> Soliciting material pursuant to Rule&nbsp;14a-12 under the Exchange Act (17 CFR 240.14a-12)
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule&nbsp;14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule&nbsp;13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
</DIV>


<DIV style="width: 100%; border-bottom: 1pt solid black; margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>





<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">








<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;1.01 Entry into a Material Definitive Agreement.</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><I>Amendment of 1997 Stock Plan </I></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At the Registrant&#146;s 2006 Annual Meeting of Shareholders, the Registrant&#146;s shareholders
approved an amendment to the Registrant&#146;s 1997 Stock Plan (the &#147;1997 Plan&#148;) to increase the maximum
number of shares of common stock that may be issued under the 1997 Plan by 500,000 shares to a
total of 20,113,750 shares. The 1997 Plan incorporating the amendment was adopted by the
Registrant&#146;s Board of Directors in October&nbsp;2006, subject to approval of its shareholders, and
became effective with such shareholder approval on November&nbsp;17, 2006.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A more detailed description of the terms of the 1997 Plan can be found in the Registrant&#146;s
proxy statement filed with the Securities and Exchange Commission on October&nbsp;19, 2006 in the
section entitled &#147;Proposal No.&nbsp;2&#151;Approval of Amendment
to the bebe stores, inc. 1997 Stock Plan,
as amended, to Increase Authorized Number of Shares&#148; and is incorporated by reference herein. The
foregoing summary and the summary incorporated by reference from the proxy statement are qualified
in their entirety by the full text of the 1997 Plan filed herewith as Exhibit&nbsp;99.1 and incorporated
herein by reference.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;9.01 Financial Statements and Exhibits.</B>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>(d)</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>Exhibits.</B></TD>
</TR>

</TABLE>
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="7%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="88%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Exhibit No.</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Description</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">99.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">bebe stores, inc. 1997 Stock Plan, as amended.</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->2<!-- /Folio -->
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SIGNATURE</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Date:
November&nbsp;22, 2006
</DIV>


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>bebe stores, inc.</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">/s/ Walter Parks
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Walter Parks, Chief Operating Officer and</B>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Chief Financial Officer</B>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt"><!-- Folio -->3<!-- /Folio -->
</DIV>


</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>f25408exv99w1.htm
<DESCRIPTION>EXHIBIT 99.1
<TEXT>
<HTML>
<HEAD>
<TITLE>exv99w1</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="right" style="font-size: 10pt; margin-top: 12pt">Exhibit&nbsp;99.1
</DIV>


<DIV align="center" style="font-size: 14pt; margin-top: 18pt"><B>bebe stores, inc.</B>
</DIV>


<DIV align="Center" style="font-size: 14pt; margin-top: 6pt"><B>1997 STOCK PLAN</B>

</DIV>

<DIV align="Center" style="font-size: 10pt; margin-top: 6pt">(As amended and restated through October&nbsp;2006)

</DIV>

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt">TABLE OF CONTENTS
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="86%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000">Page</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">1.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Establishment and Purpose
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">1</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">2.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Administration
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">1</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) Committees of the Board of Directors
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">1</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Authority of the Board of Directors
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">1</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(c) Administration with Respect to Insiders
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">1</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(d) Committee Complying with Section&nbsp;162(m)
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">1</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">3.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Eligibility and Award Limitation
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">2</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) General Rule
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">2</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Ten-Percent Shareholders
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">2</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(c) Section&nbsp;162(m) Grant Limit
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">2</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Stock Subject to Plan
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">2</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) Basic Limitation
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">2</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Additional Shares
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">2</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">5.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Terms and Conditions of Restricted Stock Awards or Sales
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">2</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) Restricted Stock Agreement
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">2</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Duration and Nontransferability of Stock Purchase Rights
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">3</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(c) Purchase Price
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">3</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(d) Restrictions on Transfer of Shares and Vesting
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">3</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(e) Accelerated Vesting
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">3</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">6.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Terms and Conditions of Options
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">3</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) Stock Option Agreement
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">3</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Number of Shares
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">3</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(c) Exercise Price
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">4</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(d) Exercisability
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">4</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(e) Accelerated Vesting and Exercisability
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">4</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(f) Basic Term
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">4</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(g) Transferability of Options
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">4</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(h) Termination of Service (Except by Death or for Cause)
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">4</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(i) Leaves of Absence
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">5</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(j) Death of Participant
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">5</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(k) Termination for Cause
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">5</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(l) No Rights as a Shareholder
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">6</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(m) Modification, Extension and Assumption of Options
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">6</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(n) Restrictions on Transfer of Shares and Vesting
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">6</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">7.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Terms and Conditions of Restricted Stock Units
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">6</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->i<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="center" style="font-size: 10pt; margin-top: 18pt">TABLE OF CONTENTS
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="86%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000">Page</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) Restricted Stock Units Agreement
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">6</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Purchase Price
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">6</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(c) Vesting
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">7</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(d) Voting
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">7</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(e) Effect of Termination of Service
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">7</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(f) Settlement of Restricted Stock Unit Award
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">7</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(g) Accelerated Vesting and Settlement of Restricted Stock Unit Awards
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">7</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(h) Restrictions on Transfer of Restricted Stock Unit Awards
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">8</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">8.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Payment for Shares
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">8</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) General Rule
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">8</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Surrender of Stock
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">8</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(c) Services Rendered
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">8</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(d) Exercise/Sale
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">8</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(e) Exercise/Pledge
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">8</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">9.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Adjustment of Shares
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">9</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) General
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">9</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Mergers and Consolidations
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">9</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(c) Reservation of Rights
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">9</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">10.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Securities Law Requirements
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">10</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) General
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">10</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Financial Reports
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">10</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">11.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Compliance with Section&nbsp;409A
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">10</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) Awards Subject to Section&nbsp;409A
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">10</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Deferral and/or Distribution Elections
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">10</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(c) Subsequent Elections
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">11</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(d) Distributions Pursuant to Deferral Elections
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">11</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(e) Unforeseeable Emergency
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">12</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(f) Disabled
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">12</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(g) Death
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">13</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(h) No Acceleration of Distributions
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">13</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">12.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Tax Withholding
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">13</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) Tax Withholding in General
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">13</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Withholding in Shares
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">13</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">13.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">No Retention Rights
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">14</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
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<DIV align="center" style="font-size: 10pt; margin-top: 18pt">TABLE OF CONTENTS
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="86%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000">Page</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">14.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Duration and Amendments
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">14</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(a) Term of the Plan
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">14</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(b) Right to Amend or Terminate the Plan
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">14</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">(c) Effect of Amendment or Termination
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">14</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">15.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Definitions
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">15</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD valign="bottom">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">16.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Execution
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom">18</TD>
    <TD nowrap valign="bottom">&nbsp;</TD>
</TR>
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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="center" style="font-size: 10pt; margin-top: 18pt">bebe stores, inc.<BR>
1997 STOCK PLAN
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;<U>Establishment and Purpose</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The purpose of the Plan is to offer selected individuals an opportunity to acquire a
proprietary interest in the success of the Company, or to increase such interest, by acquiring
Shares of the Company&#146;s Stock. The Plan provides for the direct award or sale of Shares, the grant
of Options to purchase Shares and the grant of Restricted Stock Units. Options granted under the
Plan may include Nonstatutory Options (&#147;NSOs&#148;) as well as Incentive Stock Options (&#147;ISOs&#148;) intended
to qualify under Section&nbsp;422 of the Code.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capitalized terms are defined in Section&nbsp;15.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;<U>Administration</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Committees of the Board of Directors</U>. The Plan may be administered by one or more
Committees. Each Committee shall consist of two or more members of the Board of Directors who have
been appointed by the Board of Directors. Each Committee shall have such authority and be
responsible for such functions as the Board of Directors has assigned to it. If no Committee has
been appointed, the entire Board of Directors shall administer the Plan. Any reference to the
Board of Directors in the Plan shall be construed as a reference to the Committee (if any) to whom
the Board of Directors has assigned a particular function.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Authority of the Board of Directors</U>. Subject to the provisions of the Plan, the
Board of Directors shall have full authority and discretion to take any actions it deems necessary
or advisable for the administration of the Plan. All decisions, interpretations and other actions
of the Board of Directors shall be final and binding on all Participants and all persons deriving
their rights from a Participant.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Administration with Respect to Insiders</U>. With respect to participation by
Insiders in the Plan, at any time that any class of equity security of the Company is registered
pursuant to Section&nbsp;12 of the Exchange Act, the Plan shall be administered in compliance with the
requirements, if any, of Rule&nbsp;16b-3.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Committee Complying with Section&nbsp;162(m)</U>. If the Company (or any Parent or
Subsidiary) is a &#147;publicly held corporation&#148; within the meaning of Section&nbsp;162(m), the Board of
Directors may establish a committee of &#147;outside directors&#148; within the meaning of Section 162(m) to
approve any grants under the Plan which might reasonably be anticipated to result in the payment of
employee remuneration that would otherwise exceed the limit on employee remuneration deductible for
income tax purposes pursuant to Section&nbsp;162(m).
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;<U>Eligibility and Award Limitation</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>General Rule</U>. Only Employees, Outside Directors and Consultants shall be eligible
for the grant of Options, the direct award or sale of Shares and the grant of Restricted Stock
Units. Only Employees shall be eligible for the grant of ISOs.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Ten-Percent Shareholders</U>. An individual who owns more than 10% of the total
combined voting power of all classes of outstanding stock of the Company, its Parent or any of its
Subsidiaries shall not be eligible to be granted an ISO unless (i)&nbsp;the Exercise Price is at least
110% of the Fair Market Value of a Share on the date of grant, and (ii)&nbsp;the ISO, by its terms is
not exercisable after the expiration of five years from the date of grant. For purposes of this
Subsection (b), in determining stock ownership, the attribution rules of Section 424(d) of the Code
shall be applied.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Section&nbsp;162(m) Grant Limit</U>. Subject to adjustment as provided in Section&nbsp;9(a), at
any such time as the Company is a &#147;publicly held corporation&#148; within the meaning of Section&nbsp;162(m),
no Employee shall be granted one or more Options within any fiscal year of the Company which in the
aggregate are for the purchase of more than one million six hundred eighty-seven thousand five
hundred (1,687,500) shares (the
<I>&#147;</I><B><I>Section&nbsp;162(m) Grant Limit</I></B><I>&#148;</I>)<I>. </I>An Option which is canceled in the
same fiscal year of the Company in which it was granted shall continue to be counted against the
Section 162(m) Grant Limit for such period.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;<U>Stock Subject to Plan</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Basic Limitation</U>. The aggregate number of Shares that may be issued under the
Plan (upon exercise of Options, Stock Purchase Rights, Restricted Stock Units or other rights to
acquire Shares) shall not exceed twenty million one hundred thirteen thousand seven hundred fifty
(20,113,750) Shares, subject to adjustment pursuant to Section&nbsp;9. The number of Shares that are
subject to Options or other rights outstanding at any time under the Plan shall not exceed the
number of Shares that then remain available for issuance under the Plan. The Company, during the
term of the Plan, shall at all times reserve and keep available sufficient Shares to satisfy the
requirements of the Plan.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Additional Shares</U>. In the event that any outstanding Option, Stock Purchase
Right, Restricted Stock Units or other right for any reason expires or is canceled or otherwise
terminated, the Shares allocable to the portion of such award which has not been exercised or
settled as of the time of such termination shall again be available for the purposes of the Plan.
In the event that Shares issued under the Plan are reacquired by the Company pursuant to any
forfeiture provision, right of repurchase or right of first refusal, such Shares shall again be
available for the purposes of the Plan, except that the aggregate number of Shares which may be
issued upon the exercise of ISOs shall in no event exceed twenty million one hundred thirteen
thousand seven hundred fifty (20,113,750) Shares (subject to adjustment pursuant to Section&nbsp;9).
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;<U>Terms and Conditions of Restricted Stock Awards or Sales</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Restricted Stock Agreement</U>. Each award or sale of Shares pursuant to Section&nbsp;5
shall be evidenced by a Restricted Stock Agreement between the Participant and the
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Company. Such
award or sale shall be subject to all applicable terms and conditions of the Plan and may be
subject to any other terms and conditions which are not inconsistent with the Plan and which the
Board of Directors deems appropriate for inclusion in a Restricted Stock Agreement. The provisions
of the various Restricted Stock Agreements entered into under the Plan need not be identical.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Duration and Nontransferability of Stock Purchase Rights</U>. Any Stock Purchase
Right granted pursuant to Section&nbsp;5 shall automatically expire if not exercised by the Participant
within 30&nbsp;days after the grant of such right was communicated to the Participant by the Company in
writing. A Stock Purchase Right shall not be transferable and shall be exercisable only by the
Participant to whom such right was granted.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Purchase Price</U>. The purchase price of Shares to be offered for sale pursuant to a
Stock Purchase Right shall not be less than 85% of the Fair Market Value of such Shares. Subject
to the preceding sentence, the purchase price shall be determined by the Board of Directors at its
sole discretion. The purchase price shall be payable in a form or combination of the forms of
consideration applicable to payment of the purchase price, as described in Section&nbsp;8.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Restrictions on Transfer of Shares and Vesting</U>. Any Shares awarded or sold
pursuant to this Section&nbsp;5 shall be subject to such forfeiture conditions, rights of repurchase,
rights of first refusal and other transfer restrictions as the Board of Directors may determine.
Such restrictions shall be set forth in the applicable Restricted Stock Agreement and shall apply
in addition to any restrictions that may apply to holders of Shares generally.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <U>Accelerated Vesting</U>. Unless the applicable Restricted Stock Agreement provides
otherwise, any right to automatically reacquire for no consideration Shares awarded pursuant to
this Section&nbsp;5 or to repurchase Shares sold pursuant to this Section&nbsp;5 at their original purchase
price upon termination of the Participant&#146;s Service shall lapse and all of such Shares shall become
vested if the Company is subject to a Change in Control and the reacquisition right or repurchase
right is not assigned to the entity that employs the Participant immediately after the Change in
Control or to its parent or subsidiary.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;<U>Terms and Conditions of Options</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Stock Option Agreement</U>. Each grant of an Option under the Plan shall be evidenced
by a Stock Option Agreement between the Participant and the Company. Such Option shall be subject
to all applicable terms and conditions of the Plan and may be subject to any other terms and
conditions which are not inconsistent with the Plan and which the Board of Directors deems
appropriate for inclusion in a Stock Option Agreement. The provisions of the various Stock Option Agreements entered into under the Plan need not be
identical.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Number of Shares</U>. Each Stock Option Agreement shall specify the number of Shares
that are subject to the Option and shall provide for the adjustment of such number in accordance
with Section&nbsp;9. The Stock Option Agreement shall also specify whether the Option is an ISO or an
NSO.
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Exercise Price</U>. Each Stock Option Agreement shall specify the Exercise Price.
The Exercise Price of an ISO shall not be less than 100% of the Fair Market Value of a Share on the
date of grant, and a higher percentage may be required by Section&nbsp;3(b). The Exercise Price of an
NSO shall not be less than 85% of the Fair Market Value of a Share on the date of grant; provided,
however, that any NSO constituting Section&nbsp;409A Deferred Compensation shall comply with the
requirements of Section&nbsp;11 of the Plan and Section&nbsp;409A of the Code. Subject to the preceding two
sentences, the Exercise Price under any Option shall be determined by the Board of Directors at its
sole discretion. The Exercise Price shall be payable in a form or combination of the forms of
consideration applicable to Options, as described in Section&nbsp;8.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Exercisability</U>. Each Stock Option Agreement shall specify the date when, or the
terms, performance criteria or other conditions upon the satisfaction of which, all or any
installment of the Option is to become exercisable. The exercisability provisions of any Stock
Option Agreement shall be determined by the Board of Directors at its sole discretion.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <U>Accelerated Vesting and Exercisability</U>. Unless the applicable Stock Option
Agreement or, with respect to any NSO constituting Section&nbsp;409A Deferred Compensation, the
requirements of Section&nbsp;11 of the Plan and Section&nbsp;409A of the Code, provides otherwise, all of a
Participant&#146;s Options shall become exercisable and vested in full if (i)&nbsp;the Company is subject to
a Change in Control, (ii)&nbsp;such Options are not assumed by the surviving corporation or its parent
and (iii)&nbsp;the surviving corporation or its parent does not substitute options with substantially
the same terms for such Options. Any options which are not assumed or substituted for in
connection with the Change in Control shall, to the extent not exercised as of the date of the
Change in Control, terminate and cease to be outstanding effective as of the date of the Change in
Control.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <U>Basic Term</U>. The Stock Option Agreement shall specify the term of the Option. The
term of an ISO shall not exceed 10&nbsp;years from the date of grant, and a shorter term may be required
by Section&nbsp;3(b). Subject to the preceding sentence, the Board of Directors at its sole discretion
shall determine when an Option is to expire.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <U>Transferability of Options</U>. No Option shall be transferable by the Participant
other than by beneficiary designation, will or the laws of descent and distribution. An Option may
be exercised during the lifetime of the Participant only by the Participant or by the Participant&#146;s
guardian or legal representative. No Option or interest therein may be transferred,
assigned, pledged or hypothecated by the Participant during the Participant&#146;s lifetime,
whether by operation of law or otherwise, or be made subject to execution, attachment or similar
process. Notwithstanding the foregoing, an NSO shall be assignable or transferable to the extent
permitted by the Board of Directors and set forth in the Stock Option Agreement evidencing such
Option.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <U>Termination of Service (Except by Death or for Cause)</U>. Unless otherwise specified
in the Stock Option Agreement, if a Participant&#146;s Service terminates for any reason other than the
Participant&#146;s death or for Cause (as defined below), then the Participant&#146;s Options shall expire on
the earliest of the following occasions:
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;The expiration date determined pursuant to Subsection (g)&nbsp;above;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)&nbsp;The date three months after the termination of the Participant&#146;s Service for any reason
other than Disability; or
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii)&nbsp;The date six months after the termination of the Participant&#146;s Service by reason of
Disability.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Participant may exercise all or part of the Participant&#146;s Options at any time before the
expiration of such Options under the preceding sentence, but only to the extent that such Options
had become exercisable before the Participant&#146;s Service terminated (or became exercisable as a
result of the termination) and the underlying Shares had vested before the Participant&#146;s Service
terminated (or vested as a result of the termination). The balance of such Options shall lapse
when the Participant&#146;s Service terminates. In the event that the Participant dies after the
termination of the Participant&#146;s Service but before the expiration of the Participant&#146;s Options,
all or part of such Options may be exercised (prior to expiration) by the executors or
administrators of the Participant&#146;s estate or by any person who has acquired such Options directly
from the Participant by beneficiary designation, bequest or inheritance, but only to the extent
that such Options had become exercisable before the Participant&#146;s Service terminated (or became
exercisable as a result of the termination) and the underlying Shares had vested before the
Participant&#146;s Service terminated (or vested as a result of the termination).
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <U>Leaves of Absence</U>. For purposes of Subsection (i)&nbsp;above, Service shall be deemed
to continue while the Participant is on a bona fide leave of absence, if such leave was approved by
the Company in writing and if continued crediting of Service for this purpose is expressly required
by the terms of such leave or by applicable law (as determined by the Company).
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <U>Death of Participant</U>. Unless otherwise specified in the Stock Option Agreement,
if a Participant dies while the Participant is in Service, then the Participant&#146;s Options shall
expire on the earlier of the following dates:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;The expiration date determined pursuant to Subsection (g)&nbsp;above; or
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)&nbsp;The date 12&nbsp;months after the Participant&#146;s death.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">All or part of the Participant&#146;s Options may be exercised at any time before the expiration of such
Options under the preceding sentence by the executors or administrators of the Participant&#146;s estate
or by any person who has acquired such Options directly from the Participant by beneficiary
designation, bequest or inheritance, but only to the extent that such Options had become
exercisable before the Participant&#146;s death (or became exercisable as a result of the death) and the
underlying Shares had vested before the Participant&#146;s death (or vested as a result of the
Participant&#146;s death). The balance of such Options shall lapse when the Participant dies.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) <U>Termination for Cause</U>. Unless otherwise specified in the Stock Option Agreement,
if a Participant&#146;s Service is terminated for Cause, the Option shall terminate and
</DIV>


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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">cease to be
exercisable immediately upon such termination of Service. Unless otherwise defined by the
Participant&#146;s Stock Option Agreement or contract of employment or service, for purposes of this
Section 6(l) <I>&#147;</I><B><I>Cause</I></B><I>&#148; </I>shall mean any of the following: (1)&nbsp;the Participant&#146;s theft, dishonesty, or
falsification of any Company documents or records; (2)&nbsp;the Participant&#146;s improper use or disclosure
of a the Company&#146;s confidential or proprietary information; (3)&nbsp;any action by the Participant which
has a material detrimental effect on the Company&#146;s reputation or business; (4)&nbsp;the Participant&#146;s
failure or inability to perform any reasonable assigned duties after written notice from the
Company of, and a reasonable opportunity to cure, such failure or inability; (5)&nbsp;any material
breach by the Participant of any employment or service agreement between the Participant and the
Company, which breach is not cured pursuant to the terms of such agreement; (6)&nbsp;the Participant&#146;s
conviction (including any plea of guilty or nolo contendere) of any criminal act which impairs the
Participant&#146;s ability to perform his or her duties with the Company; or (7)&nbsp;Participant&#146;s
conviction for a violation of any securities law.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) <U>No Rights as a Shareholder</U>. A Participant, or a transferee of a Participant,
shall have no rights as a shareholder with respect to any Shares covered by the Participant&#146;s
Option until such person becomes entitled to receive such Shares by filing a notice of exercise and
paying the Exercise Price pursuant to the terms of such Option.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) <U>Modification, Extension and Assumption of Options</U>. Within the limitations of the
Plan, the Board of Directors may modify, extend or assume outstanding Options or may accept the
cancellation of outstanding Options (whether granted by the Company or another issuer) in return
for the grant of new Options for the same or a different number of Shares and at the same or a
different Exercise Price. The foregoing notwithstanding, no modification of an Option shall,
without the consent of the Participant, impair the Participant&#146;s rights or increase the
Participant&#146;s obligations under such Option.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) <U>Restrictions on Transfer of Shares and Vesting</U>. Any Shares issued upon exercise
of an Option shall be subject to such forfeiture conditions, rights of repurchase, rights of first
refusal and other transfer restrictions as the Board of Directors may determine. Such restrictions
shall be set forth in the applicable Stock Option Agreement and shall apply in addition to any
restrictions that may apply to holders of Shares generally.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;<U>Terms and Conditions of Restricted Stock Units</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Restricted Stock Units Agreement</U>. Each Restricted Stock Unit award pursuant to
Section&nbsp;7 shall be evidenced by a Restricted Stock Units Agreement between the Participant and the
Company. Such award shall be subject to all applicable terms and conditions of the Plan and may be
subject to any other terms and conditions which are not inconsistent with the Plan and which the
Board of Directors deems appropriate for inclusion in a Restricted Stock Units Agreement. The
provisions of the various Restricted Stock Units Agreements entered into under the Plan need not be
identical.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Purchase Price</U>. No monetary payment (other than applicable tax withholding, if
any) shall be required as a condition of receiving a Restricted Stock Unit award, the consideration
for which shall be services actually rendered to the Company, a Parent or Subsidiary, or for its
benefit.
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Vesting</U>. Restricted Stock Units may or may not be made subject to vesting
conditions based upon the satisfaction of such Service requirements, conditions or restrictions, as
shall be established by the Board of Directors and set forth in the Restricted Stock Units
Agreement.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Voting</U>. A Participant shall have no voting rights with respect to shares of Stock
represented by Restricted Stock Units until the date of the issuance of such shares (as evidenced
by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the
Company).
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <U>Effect of Termination of Service</U>. Unless otherwise provided by the Board of
Directors in the grant of Restricted Stock Units and set forth in the Restricted Stock Units
Agreement, if a Participant&#146;s Service terminates for any reason, whether voluntary or involuntary
(including the Participant&#146;s death or disability), then the Participant shall forfeit to the
Company any Restricted Stock Units which remain subject to vesting conditions as of the date of the
Participant&#146;s termination of Service.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <U>Settlement of Restricted Stock Unit Award</U>. The Company shall issue to the
Participant on the date on which the Restricted Stock Units subject to the Participant&#146;s Restricted
Stock Unit award vests or on such other date as determined by the Board of Directors, in its
discretion, and set forth in the Participant&#146;s Restricted Stock Units Agreement a number of whole
shares of Stock equal to the number of whole Restricted Stock Units as set forth in and subject to
the Restricted Stock Units Agreement which are no longer subject to vesting conditions or which are
otherwise to be settled on such date, subject to withholding of applicable taxes, if any. If
permitted by the Board of Directors, the Participant may elect, consistent with the requirements of
Section&nbsp;11 of the Plan and Section&nbsp;409A of the Code, to defer receipt of all or any portion of the
shares of Stock or other property otherwise issuable to the Participant pursuant to this Section,
and such deferred issuance date(s) and amount(s) elected by the Participant shall be set forth in
the Restricted Stock Units Agreement. Notwithstanding the foregoing, the Board of Directors, in its discretion, may provide for settlement of any
Restricted Stock Unit award by payment to the Participant in cash of an amount equal to the Fair
Market Value on the payment date of the shares of Stock or other property otherwise issuable to the
Participant pursuant to this Section. The Board of Directors, in its discretion, may provide in
any Restricted Stock Units Agreement that, if the settlement of the award with respect to any
shares would otherwise occur on a day on which the sale of such shares would violate the provisions
of the Insider Trading Policy, then the settlement with respect to such shares shall occur on the
next day on which the sale of such shares would not violate the Insider Trading Policy, but in any
event on or before the later of the last day of the calendar year of, or the 15th day of the third
calendar month following, the original settlement date.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <U>Accelerated Vesting and Settlement of Restricted Stock Unit Awards</U>. Unless the
applicable Restricted Stock Units Agreement provides otherwise, all of a Participant&#146;s Restricted
Stock Units shall become vested in full if (i)&nbsp;the Company is subject to a Change in Control, (ii)
such Restricted Stock Units do not remain outstanding, (iii)&nbsp;such Restricted Stock Units are not
assumed by the surviving corporation or its parent and (iv)&nbsp;the surviving corporation or its parent
does not substitute a substantially equivalent award. Except as required
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">by Section&nbsp;11 of the Plan
and Section&nbsp;409A of the Code with respect to any Restricted Stock Units award constituting Section
409A Deferred Compensation, Restricted Stock Units shall be settled in accordance with Section 7(f)
immediately prior to the effective time of the Change in Control to the extent the Restricted Stock
Units are neither assumed or substituted for in connection with the Change in Control.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <U>Restrictions on Transfer of Restricted Stock Unit Awards</U>. Prior to the issuance
of shares of Stock in settlement of a Restricted Stock Unit award, the award shall not be subject
in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or
garnishment by creditors of the Participant or the Participant&#146;s beneficiary, except by will or by
the laws of descent and distribution.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;<U>Payment for Shares</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>General Rule</U>. The entire purchase price for Shares acquired pursuant to a Stock
Purchase Right or Exercise Price of Shares acquired pursuant to an Option shall be payable in cash
or cash equivalents at the time when such Shares are purchased, except as otherwise provided in
this Section&nbsp;8.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Surrender of Stock</U>. To the extent that a Stock Option Agreement so provides,
payment may be made all or in part with Shares owned by the Participant or the Participant&#146;s
representative. Such Shares shall be surrendered to the Company in good form for transfer and
shall be valued at their Fair Market Value on the date when the Option is exercised. This
Subsection (b)&nbsp;shall not apply to the extent that acceptance of Shares in payment of the Exercise
Price would cause the Company to recognize compensation expense with respect to the Option for
financial reporting purposes.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Services Rendered</U>. At the discretion of the Board of Directors, Shares may be
awarded under the Plan in consideration of services rendered to the Company, a Parent or a
Subsidiary prior to the award.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Exercise/Sale</U>. To the extent that a Stock Option Agreement so provides, and if
Stock is publicly traded, payment may be made all or in part by the delivery (on a form prescribed
by the Company) of an irrevocable direction to a securities broker approved by the Company to sell
Shares and to deliver all or part of the sales proceeds to the Company in payment of all or part of
the Exercise Price and any withholding taxes.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <U>Exercise/Pledge</U>. To the extent that a Stock Option Agreement so provides, and if
Stock is publicly traded, payment may be made all or in part by the delivery (on a form prescribed
by the Company) of an irrevocable direction to pledge Shares to a securities broker or lender
approved by the Company, as security for a loan, and to deliver all or part of the loan proceeds to
the Company in payment of all or part of the Exercise Price and any withholding taxes.
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;<U>Adjustment of Shares</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>General</U>. In the event of a subdivision of the outstanding Stock, a declaration of
a dividend payable in Shares, a declaration of an extraordinary dividend payable in a form other
than Shares in an amount that has a material effect on the Fair Market Value of the Stock, a
combination or consolidation of the outstanding Stock into a lesser number of Shares, a
recapitalization, a spin-off, a reclassification or a similar occurrence, the Board of Directors
shall make appropriate adjustments in one or more of (i)&nbsp;the number of Shares available for future
grants under Section&nbsp;4, (ii)&nbsp;the number of Shares covered by each outstanding Option, Stock
Purchase Right and Restricted Stock Unit award, (iii)&nbsp;the Section 162(m) Grant Limit set forth in
Section 3(c) or (vi)&nbsp;the Exercise Price under each outstanding Option. Notwithstanding the
foregoing, any fractional shares resulting from an adjustment pursuant to this Section&nbsp;9 shall be
rounded down to the nearest whole number, and no any event may the exercise price be decreased to
an amount less than the par value, if any, of the Stock.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Mergers and Consolidations</U>. In the event that the Company is a party to a merger
or consolidation, outstanding Options, Stock Purchase Rights and Restricted Stock Units shall be
subject to the agreement of merger or consolidation. Such agreement, without the Participants&#146;
consent, may provide for:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;The continuation of such outstanding Options, Stock Purchase Right or Restricted Stock
Units by the Company (if the Company is the surviving corporation);
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)&nbsp;The assumption of the Plan and such outstanding Options, Stock Purchase Rights or
Restricted Stock Units by the surviving corporation or its parent;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii)&nbsp;The substitution by the surviving corporation or its parent of options, stock purchase
rights or restricted stock units with substantially the same terms for such outstanding Options,
Stock Purchase Rights or Restricted Stock Units; or
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv)&nbsp;The cancellation of such outstanding Options without payment of any consideration.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Reservation of Rights</U>. Except as provided in this Section&nbsp;9, a Participant shall
have no rights by reason of (i)&nbsp;any subdivision or consolidation of shares of stock of any class,
(ii)&nbsp;the payment of any dividend or (iii)&nbsp;any other increase or decrease in the number of shares of
stock of any class. Any issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall not affect, and no adjustment by reason
thereof shall be made with respect to, the number or Exercise Price of Shares subject to an Option.
The grant of an Option pursuant to the Plan shall not affect in any way the right or power of the
Company to make adjustments, reclassifications, reorganizations or changes of its capital or
business structure, to merge or consolidate or to dissolve, liquidate, sell or transfer all or any
part of its business or assets.
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;<U>Securities Law Requirements</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>General</U>. Shares shall not be issued under the Plan unless the issuance and
delivery of such Shares comply with (or are exempt from) all applicable requirements of law,
including (without limitation) the Securities Act of 1933, as amended, the rules and regulations
promulgated thereunder, state securities laws and regulations, and the regulations of any stock
exchange or other securities market on which the Company&#146;s securities may then be traded.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Financial Reports</U>. Each Participant shall be given access to information
concerning the Company equivalent to that information generally made available to the Company&#146;s
common shareholders.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;<U>Compliance with Section&nbsp;409A</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Awards Subject to Section&nbsp;409A</U>. The provisions of this Section&nbsp;11 shall apply to
any award or portion thereof that constitutes Section&nbsp;409A Deferred Compensation, notwithstanding
any provision to the contrary contained in the Plan or the award agreement applicable to such
award. Section&nbsp;409A Deferred Compensation includes, without limitation:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;Any NSO having an Exercise Price less than 100% of the Fair Market Value of a Share on the
date of grant of the NSO or that permits the deferral of compensation other than the deferral of
recognition of income until the exercise of the NSO.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)&nbsp;Any Restricted Stock Unit award if either (A)&nbsp;the award provides by its terms for
settlement of all or any portion of the award on one or more dates following the
Short-Term Deferral Period (as defined below) or (B)&nbsp;the Board of Directors permits or
requires the Participant to elect one or more dates on which the award will be settled.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Subject to any applicable U.S. Treasury Regulations promulgated pursuant to Section&nbsp;409A or other
applicable guidance, the term &#147;<U>Short-Term Deferral Period</U>&#148; means the period ending on the
later of (i)&nbsp;the 15th day of the third month following the end of the Company&#146;s fiscal year in
which the applicable portion of the award is no longer subject to a substantial risk of forfeiture
or (ii)&nbsp;the 15th day of the third month following the end of the Participant&#146;s taxable year in
which the applicable portion of the award is no longer subject to a substantial risk of forfeiture.
For this purpose, the term &#147;substantial risk of forfeiture&#148; shall have the meaning set forth in
any applicable U.S. Treasury Regulations promulgated pursuant to Section&nbsp;409A or other applicable
guidance.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Deferral and/or Distribution Elections</U>. Except as otherwise permitted or required
by Section&nbsp;409A or any applicable U.S. Treasury Regulations promulgated pursuant to Section&nbsp;409A or
other applicable guidance, the following rules shall apply to any deferral and/or distribution
elections (each, an &#147;<U>Election</U>&#148;) that may be permitted or required by the Board of Directors
pursuant to an award constituting Section&nbsp;409A Deferred Compensation:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;All Elections must be in writing and specify the amount of the distribution in settlement
of an award being deferred, as well as the time and form of distribution as permitted by this Plan.
</DIV>

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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)&nbsp;All Elections shall be made by the end of the Participant&#146;s taxable year prior to the
year in which services commence for which an award may be granted to such Participant; provided,
however, that if the award qualifies as &#147;performance-based compensation&#148; for purposes of Section
409A and is based on services performed over a period of at least twelve (12)&nbsp;months, then the
Election may be made no later than six (6)&nbsp;months prior to the end of such period.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii)&nbsp;Elections shall continue in effect until a written election to revoke or change such
Election is received by the Company, except that a written election to revoke or change such
Election must be made prior to the last day for making an Election determined in accordance with
paragraph (ii<U>) above or as permitted by Section&nbsp;11(c).</U>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Subsequent Elections</U>. Except as otherwise permitted or required by Section&nbsp;409A
or any applicable U.S. Treasury Regulations promulgated pursuant to Section&nbsp;409A or other
applicable guidance, any award constituting Section&nbsp;409A Deferred Compensation which permits a
subsequent Election to delay the distribution or change the form of distribution in settlement of
such award shall comply with the following requirements:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;No subsequent Election may take effect until at least twelve (12)&nbsp;months after the date on
which the subsequent Election is made;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)&nbsp;Each subsequent Election related to a distribution in settlement of an Award not
described in Section&nbsp;11(d)(ii), 11(d)(iii), or 11(d)(vi) must result in a delay of the distribution
for a period of not less than five (5)&nbsp;years from the date such distribution would otherwise have
been made; and
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii)&nbsp;No subsequent Election related to a distribution pursuant to Section&nbsp;11(d)(iv) shall be
made less than twelve (12)&nbsp;months prior to the date of the first scheduled payment under such
distribution.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <U>Distributions Pursuant to Deferral Elections</U>. Except as otherwise permitted or
required by Section&nbsp;409A or any applicable U.S. Treasury Regulations promulgated pursuant to
Section&nbsp;409A or other applicable guidance, no distribution in settlement of an award constituting
Section&nbsp;409A Deferred Compensation may commence earlier than:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;Separation from service (as determined by the Secretary of the United States Treasury);
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)&nbsp;The date the Participant becomes Disabled (as defined below);
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iii)&nbsp;Death;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (iv)&nbsp;A specified time (or pursuant to a fixed schedule) that is either (A)&nbsp;specified by the
Board of Directors upon the grant of an award and set forth in the award agreement evidencing such
award or (B)&nbsp;specified by the Participant in an Election complying with the requirements of Section
11(b) and/or 11(c), as applicable;
</DIV>

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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (v)&nbsp;To the extent provided by the Secretary of the U.S. Treasury, a change in the ownership or
effective control or the Company or in the ownership of a substantial portion of the assets of the
Company; or
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (vi)&nbsp;The occurrence of an Unforeseeable Emergency (as defined by applicable U.S. Treasury
Regulations promulgated pursuant to Section&nbsp;409A).
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Notwithstanding anything else herein to the contrary, to the extent that a Participant is a
&#147;Specified Employee&#148; (as defined in Section&nbsp;409A(a)(2)(B)(i) of the Code) of the Company, no
distribution pursuant to Section&nbsp;11(d)(i) in settlement of an award constituting Section&nbsp;409A
Deferred Compensation may be made before the date (the
<I>&#147;</I><B><I>Delayed Payment Date</I></B><I>&#148;</I>) which is six (6)
months after such Participant&#146;s date of separation from service, or, if earlier, the date of the
Participant&#146;s death. All such amounts that would, but for this paragraph, become payable prior to
the Delayed Payment Date shall be accumulated and paid on the Delayed Payment Date.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <U>Unforeseeable Emergency</U>. The Board of Directors shall have the authority to
provide in the award agreement evidencing any award constituting Section&nbsp;409A Deferred Compensation
for distribution in settlement of all or a portion of such award in the event that a Participant
establishes, to the satisfaction of the Board of Directors, the occurrence of
an Unforeseeable Emergency. In such event, the amount(s) distributed with respect to such
Unforeseeable Emergency cannot exceed the amounts necessary to satisfy such Unforeseeable Emergency
plus amounts necessary to pay taxes reasonably anticipated as a result of such distribution(s),
after taking into account the extent to which such hardship is or may be relieved through
reimbursement or compensation by insurance or otherwise, by liquidation of the Participant&#146;s assets
(to the extent the liquidation of such assets would not itself cause severe financial hardship) or
by cessation of deferrals under the award. All distributions with respect to an Unforeseeable
Emergency shall be made in a lump sum as soon as practicable following the Committee&#146;s
determination that an Unforeseeable Emergency has occurred.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The occurrence of an Unforeseeable Emergency shall be judged and determined by the Board of
Directors. The Board of Directors&#146; decision with respect to whether an Unforeseeable Emergency has
occurred and the manner in which, if at all, the distribution in settlement of an Award shall be
altered or modified, shall be final, conclusive, and not subject to approval or appeal.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <U>Disabled</U>. The Board of Directors shall have the authority to provide in any award
constituting Section&nbsp;409A Deferred Compensation for distribution in settlement of such award in the
event that the Participant becomes Disabled. A Participant shall be considered &#147;Disabled&#148; if
either:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;the Participant is unable to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be expected to result in death or
can be expected to last for a continuous period of not less than twelve (12)&nbsp;months, or
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)&nbsp;the Participant is, by reason of any medically determinable physical or mental impairment
which can be expected to result in death or can be expected to last
</DIV>

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</DIV>

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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">for a continuous period of not
less than twelve (12)&nbsp;months, receiving income replacement benefits for a period of not less than
three (3)&nbsp;months under an accident and health plan covering employees of the Participant&#146;s
employer.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All distributions payable by reason of a Participant becoming Disabled shall be paid in a lump
sum or in periodic installments as established by the Participant&#146;s Election, commencing as soon as
practicable following the date the Participant becomes Disabled. If the Participant has made no
Election with respect to distributions upon becoming Disabled, all such distributions shall be paid
in a lump sum as soon as practicable following the date the Participant becomes Disabled.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <U>Death</U>. If a Participant dies before complete distribution of amounts payable upon
settlement of an award constituting Section&nbsp;409A Deferred Compensation, such undistributed amounts
shall be distributed to his or her beneficiary under the distribution method for death established
by the Participant&#146;s Election as soon as administratively possible following receipt by the
Committee of satisfactory notice and confirmation of the Participant&#146;s death. If the
Participant has made no Election with respect to distributions upon death, all such
distributions shall be paid in a lump sum as soon as practicable following the date of the
Participant&#146;s death.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <U>No Acceleration of Distributions</U>. Notwithstanding anything to the contrary
herein, this Plan does not permit the acceleration of the time or schedule of any distribution
under an award constituting Section&nbsp;409A Deferred Compensation, except as provided by Section&nbsp;409A
and/or the Secretary of the U.S. Treasury.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;<U>Tax Withholding</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Tax Withholding in General</U>. The Company shall have the right to deduct from any
and all payments made under the Plan, or to require the Participant, through payroll withholding,
cash payment or otherwise, to make adequate provision for, the federal, state, local and foreign
taxes, if any, required by law to be withheld by such the Participant&#146;s employer with respect to an
award or the shares acquired pursuant thereto. The Company shall have no obligation to deliver
Shares, to release Shares from an escrow established pursuant to an award agreement, or to make any
payment in cash under the Plan until such tax withholding obligations have been satisfied.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Withholding in Shares</U>. The Company shall have the right, but not the obligation,
to deduct from the Shares issuable to a Participant upon the exercise or settlement of an award, or
to accept from the Participant the tender of, a number of whole Shares having a Fair Market Value,
as determined by the Company, equal to all or any part of the tax withholding obligations of the
Participant&#146;s employer. The Fair Market Value of any Shares withheld or tendered to satisfy any
such tax withholding obligations shall not exceed the amount determined by the applicable minimum
statutory withholding rates.
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;<U>No Retention Rights</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nothing in the Plan or in any right, Option or Restricted Stock Unit granted under the Plan
shall confer upon the Participant any right to continue in Service for any period of specific
duration or interfere with or otherwise restrict in any way the rights of the Company (or any
Parent or Subsidiary employing or retaining the Participant) or of the Participant which rights are
hereby expressly reserved by each, to terminate his or her Service at any time and for any reason,
with or without cause.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.&nbsp;<U>Duration and Amendments</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <U>Term of the Plan</U>. The Plan, as set forth herein, shall become effective on the
date of its adoption by the Board of Directors, subject to the approval of the Company&#146;s
shareholders. In the event that the shareholders fail to approve the Plan within 12&nbsp;months after
its adoption by the Board of Directors, any grants of Options or sales or awards of Shares that
have already occurred shall be rescinded, and no additional grants, sales or awards shall be made
thereafter under the Plan. The Plan shall continue in effect until the earlier of its termination
by the Board or the date on which all of the Shares available for issuance under the
Plan have been issued and all restrictions on such Shares under the terms of the Plan and the
agreements evidencing Options and awards granted under the Plan have lapsed. However, all ISOs
shall be granted, if at all, within ten (10)&nbsp;years from the earlier of the date the Plan is adopted
by the Board of Directors or the date the Plan is duly approved by the shareholders of the Company.
Notwithstanding the foregoing, if the maximum number of Shares issuable pursuant to the Plan as
provided in Section&nbsp;4 has been increased at any time (other than pursuant to Section&nbsp;9), all ISOs
shall be granted, if at all, within ten (10)&nbsp;years from the earlier of (i)&nbsp;the date on which the
latest such increase in the maximum number of Shares issuable under the Plan was approved by the
shareholders of the Company or (ii)&nbsp;the date such amendment was adopted by the Board of Directors.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <U>Right to Amend or Terminate the Plan</U>. The Board of Directors may amend, suspend
or terminate the Plan at any time and for any reason; provided, however, that any amendment of the
Plan which increases the number of Shares available for issuance under the Plan (except as provided
in Section&nbsp;9), or which materially changes the class of persons who are eligible for the grant of
ISOs, shall be subject to the approval of the Company&#146;s shareholders. Shareholder approval shall
not be required for any other amendment of the Plan.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <U>Effect of Amendment or Termination</U>. No Shares shall be issued or sold under the
Plan after the termination thereof, except in settlement of Restricted Stock Unit awards and upon
exercise of an Option granted prior to such termination. The termination of the Plan, or any
amendment thereof, shall not affect any Share previously issued or any Option previously granted
under the Plan; provided, however, that notwithstanding any other provision of the Plan to the
contrary, the Board of Directors may, in its sole and absolute discretion and without the consent
of any Participant, amend the Plan or any award agreement, to take effect retroactively or
otherwise, as it deems necessary or advisable for the purpose of conforming the Plan or such award
agreement to any present or future law, regulation or rule applicable to the Plan, including, but
not limited to, Section&nbsp;409A.
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.&nbsp;<U>Definitions</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) &#147;<U>Board of Directors</U>&#148; shall mean the Board of Directors of the Company, as
constituted from time to time.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) &#147;<U>Change in Control</U>&#148; shall mean:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;The consummation of a merger or consolidation of the Company with or into another entity
or any other corporate reorganization, unless 50% or more of the combined voting power of the
continuing or surviving entity&#146;s securities outstanding immediately after such merger,
consolidation or other reorganization is owned by persons who were shareholders of the Company
immediately prior to such merger, consolidation or other reorganization, in substantially the same
proportions as their ownership of Company stock prior to the transaction ; or
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)&nbsp;The sale, transfer or other disposition of all or substantially all of the Company&#146;s
assets.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Notwithstanding the foregoing, to the extent that any amount constituting Section&nbsp;409A Deferred
Compensation would become payable under this Plan by reason of a Change in Control, such amount
shall become payable only if the event constituting a Change in Control would also constitute a
change in ownership or effective control of the Company or a change in the ownership of a
substantial portion of the assets of the Company within the meaning of Section&nbsp;409A. A transaction
shall not constitute a Change in Control if its sole purpose is to change the state of the
Company&#146;s incorporation or to create a holding company that will be owned in substantially the same
proportions by the persons who held the Company&#146;s securities immediately before such transaction.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) &#147;<U>Code</U>&#148; shall mean the Internal Revenue Code of 1986, as amended, and any
applicable regulations or administrative guidelines promulgated thereunder.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) &#147;<U>Committee</U>&#148; shall mean a committee of the Board of Directors, as described in
Section&nbsp;2(a).
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) &#147;<U>Company</U>&#148; shall mean bebe stores, inc., a California corporation.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) &#147;<U>Consultant</U>&#148; shall mean an individual who performs bona fide services for the
Company, a Parent or a Subsidiary as a consultant or advisor, excluding Employees and Outside
Directors.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) &#147;<U>Disability</U>&#148; shall mean that the Participant is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or mental impairment.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) &#147;<U>Employee</U>&#148; shall mean any individual who is a common-law employee of the Company,
a Parent or a Subsidiary.
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) &#147;<U>Exchange Act</U>&#148; shall mean the Securities Exchange Act of 1934, as amended.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) &#147;<U>Exercise Price</U>&#148; shall mean the amount for which one Share may be purchased upon
exercise of an Option, as specified by the Board of Directors in the applicable Stock Option
Agreement.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) &#147;<U>Fair Market Value</U>&#148; shall mean, as of any date, the value of a Share as determined
by the Board of Directors, in its sole discretion, subject to the following:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)&nbsp;If, on such date, there is a public market for the Stock, the Fair Market Value of a Share
shall be the closing sale price of a Share (or the mean of the closing bid and asked prices of a
Share if the Stock is so quoted instead) as quoted on such national or
regional securities exchange or market system as constitutes the primary market for the Stock,
as reported in <U>The Wall Street Journal</U> or such other source as the Company deems reliable.
If the relevant date does not fall on a day on which the Stock has traded on such securities
exchange or market system, the date on which the Fair Market Value shall be established shall be
the last day on which the Stock was so traded prior to the relevant date, or such other appropriate
day as shall be determined by the Board of Directors, in its sole discretion.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (ii)&nbsp;If, on such date, there is no public market for the Stock, the Fair Market Value of a
Share shall be as determined by the Board of Directors in good faith and in a manner consistent
with the requirements of Section&nbsp;409A.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) &#147;<U>Insider</U>&#148; shall mean an officer or a director of the Company or any other person
whose transactions in Stock are subject to Section&nbsp;16 of the Exchange Act.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) &#147;<U>Insider Trading Policy</U>&#148; shall mean the written policy of the Company pertaining
to the purchase, sale, transfer or other disposition of the Company&#146;s equity securities by persons
who may possess material, nonpublic information regarding the Company or its securities.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) &#147;<U>ISO</U>&#148; shall mean an incentive stock option described in Section 422(b) of the
Code.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) &#147;<U>NSO</U>&#148; shall mean a stock option not described in Sections 422(b) or 423(b) of the
Code.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) &#147;<U>Option</U>&#148; shall mean an ISO or an NSO granted under the Plan and entitling the
holder to purchase Shares.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) &#147;<U>Outside Director</U>&#148; shall mean a member of the Board of Directors who is not an
Employee.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) &#147;<U>Parent</U>&#148; shall mean any corporation (other than the Company) in an unbroken chain
of corporations ending with the Company, if each of the corporations other than the Company owns
stock possessing 50% or more of the total combined voting power of all
</DIV>


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</DIV>

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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">classes of stock in one of
the other corporations in such chain. A corporation that attains the status of a Parent on a date
after the adoption of the Plan shall be considered a Parent commencing as of such date.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) &#147;<U>Plan</U>&#148; shall mean this bebe stores, inc. 1997 Stock Plan.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t) &#147;<U>Participant</U>&#148; shall mean an individual to whom the Board of Directors has granted
an award pursuant to the Plan.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u) &#147;<U>Restricted Stock Agreement</U>&#148; shall mean the agreement between the Company and a
Participant who acquires Shares under Section&nbsp;5 which contains the terms, conditions and
restrictions pertaining to the acquisition of such Shares.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) &#147;<U>Restricted Stock Unit</U>&#148; shall mean a right granted to a Participant pursuant to
Section&nbsp;7 of the Plan to receive a share of Stock on a date determined in accordance with the
provisions of Section&nbsp;7 and the Participant&#146;s Restricted Stock Units Agreement.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(w) &#147;<U>Restricted Stock Units Agreement</U>&#148; shall mean a written agreement between the
Company and a Participant who is granted Restricted Stock Units under the Plan which contains the
terms, conditions and restrictions pertaining to the acquisition of such award.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) &#147;<U>Rule&nbsp;16b-3</U>&#148; shall mean Rule&nbsp;16b-3 under the Exchange Act, as amended from time to
time, or any successor rule or regulation.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(y) &#147;<U>Section&nbsp;162(m)</U>&#148; shall mean Section 162(m) of the Code.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(z) &#147;<U>Section&nbsp;409A</U>&#148; shall mean Section&nbsp;409A of the Code.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(aa) &#147;<U>Section&nbsp;409A Deferred Compensation</U><I>&#148; </I>shall mean compensation provided pursuant to
the Plan that constitutes deferred compensation subject to and not exempted from the requirements
of Section&nbsp;409A.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(bb) &#147;<U>Service</U>&#148; shall mean service as an Employee, Outside Director or Consultant.
Service shall not be deemed to have terminated merely because of a change in the capacity in which
an individual renders Service to the Company (or any Parent or Subsidiary) or a change in the
corporation for which the individual renders such Service, provided that there is no interruption
or termination of the individual&#146;s Service.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(cc) &#147;<U>Share</U>&#148; shall mean one share of Stock, as adjusted in accordance with Section&nbsp;9
(if applicable).
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(dd) &#147;<U>Stock</U>&#148; shall mean the Common Stock of the Company.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ee) &#147;<U>Stock Option Agreement</U>&#148; shall mean the agreement between the Company and a
Participant which contains the terms, conditions and restrictions pertaining to the Participant&#146;s
Option.
</DIV>


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<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ff) &#147;<U>Stock Purchase Right</U>&#148; means a right to purchase Shares granted under Section&nbsp;5.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(gg) &#147;<U>Subsidiary</U>&#148; means any corporation (other than the Company) in an unbroken chain
of corporations beginning with the Company, if each of the corporations other than the last
corporation in the unbroken chain owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other corporations in such chain. A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan
shall be considered a Subsidiary commencing as of such date.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.&nbsp;<U>Execution</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned hereby certifies that the foregoing is the bebe stores, inc. 1997 Stock Plan
as amended and restated.
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>bebe stores, inc.</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Gregory Scott
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Title:   Chief Executive Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;</TD>
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