AMENDED AND RESTATED 2003 STOCK-BASED INCENTIVE COMPENSATION PLAN

ADOLOR CORPORATION

2003 STOCK-BASED INCENTIVE COMPENSATION PLAN

1.              Purpose of the Plan

The purpose of the Plan is to assist the Company, its Subsidiaries and Affiliates in attracting and retaining valued Employees, Consultants and Directors by offering them a greater stake in the Company’s success and a closer identification with it, and to encourage ownership of the Company’s stock by such Employees, Consultants and Directors.

2.              Definitions

2.1.          “Affiliate” means any entity other than the Subsidiaries in which the Company has a substantial direct or indirect equity interest, as determined by the Board.

2.2.          “Award” means an award of Deferred Stock, Restricted Stock or Options under the Plan.

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

2.4.          “Cause” means the Participant’s (i) conviction for committing a felony under federal law or of the state in which such action occurred, (ii) dishonesty in the course of fulfilling his or her employment or consulting duties or (iii) willful and deliberate failure to perform his or her employment or consulting duties in any material respect, or such other similar events as shall be determined by the Committee.  The Committee shall have the sole discretion to determine whether “Cause” as set forth in (i), (ii) or (iii) above exists, and its determination shall be final.

2.5.          “Change of Control” means the happening of any of the following:

(i)            any Person, other than (a) the Company or any of its Subsidiaries, (b) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its Subsidiaries, (c) an underwriter temporarily holding securities pursuant to an offering of such securities, (d) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportion as their ownership of stock of the Company, or (e) a Holder or any “group” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) which includes such Holder, becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or its Subsidiaries) representing more than 20% of either the then outstanding shares of Stock of the Company or the combined voting power of the Company’s then outstanding securities;

(ii)           the individuals who serve on the Board as of the effective date hereof (the “Incumbent Directors”) cease for any reason to constitute at least a majority of the Board; provided , however , any Person who becomes a director subsequent to the effective date hereof, whose election or nomination for election was approved by a vote of at least a majority of the directors then constituting the Incumbent Board, shall for purposes of this clause (ii) be considered an Incumbent Director;

(iii)          the consummation of a merger or consolidation of the Company in which the stockholders of the Company immediately prior to such merger or consolidation, would not, immediately

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after the merger or consolidation, beneficially own (as such term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, shares representing in the aggregate 50% or more of the combined voting power of the securities of the corporation issuing cash or securities in the merger or consolidation (or of its ultimate parent corporation, if any); or

(iv)          the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company, or there is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 50% of the combined voting power of the voting securities of which are owned by Persons in substantially the same proportion as their ownership of the Company immediately prior to such sale.

If an event set forth in clause (i)(e) of the definition of “Change of Control” occurs, a Change of Control shall be deemed to have occurred for each Holder other than any Holder who alone or as part of any “group” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act), becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or its Subsidiaries) representing more than 20% of either the then outstanding shares of Stock of the Company or the combined voting power of the Company’s then outstanding securities.

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

2.7.          “Common Stock” means the common stock of the Company, par value $.0001 per share, or such other class or kind of shares or other securities resulting from the application of Section 9.

2.8.          “Company” means Adolor Corporation, a Delaware corporation, or any successor corporation.

2.9.          “Committee” means the committee designated by the Board to administer the Plan under Section 4.  The Committee shall have at least two members, each of whom shall be a member of the Board, a Non-Employee Director and an Outside Director.

2.10.        “Consultant” means a key consultant or advisor to the Company, its Subsidiaries or Affiliates who is not an Employee.

2.11.        “Deferred Stock” means an Award made under Section 6 of the Plan to receive Common Stock at the end of a specified Deferral Period.

2.12.        “Deferral Period” means the period during which the receipt of a Deferred Stock Award under Section 6 of the Plan will be deferred.

2.13.        “Director” means a member of the Board.

2.14.        “Disability” means disabled within the meaning of section 22(e)(3) of the Code.

2.15.        “Employee” means an officer or other employee of the Company, a Subsidiary or an Affiliate including a director who is such an employee.

2.16.        “Fair Market Value” means, on any given date (i) if shares of Common Stock are then listed on a national stock exchange, the closing sales price per share of Common Stock on the exchange for the last preceding date on which there was a sale of shares of Common Stock on such exchange, as determined by the Committee, (ii) if shares of Common Stock are then listed on the Nasdaq National Market or the Nasdaq

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SmallCap Market, the closing sales price (or the closing bid price if no sales were reported) per share of Common Stock on the Nasdaq National Market or the Nasdaq SmallCap Market, as applicable, for the last preceding date on which there was a sale of shares of Common Stock on the Nasdaq National Market or the Nasdaq SmallCap Market, as applicable, as determined by the Committee, (iii) if shares of Common Stock are not then listed on a national stock exchange, the Nasdaq National Market or the Nasdaq Small Cap Market but are then traded on an over-the-counter market, the average of the closing bid and asked prices for the shares of Common Stock in such over-the-counter market for the last preceding date on which there was a sale of such shares of Common Stock in such market, as determined by the Committee, or (iv) if shares of Common Stock are not then listed on a national stock exchange or traded on an over-the-counter market, or if the Committee determines that the value as determined pursuant to Section (i), (ii) or (iii) above does not reflect fair market value, the Committee shall determine fair market value after taking into account such factors that it deems appropriate. Notwithstanding the foregoing, if Shares are listed on a national stock exchange or traded on an over-the-counter market, solely for purposes of determining the Exercise Price of any Option granted hereunder, the Fair Market Value per Share shall be the closing sales price on the applicable exchange or market on the date such Option is granted.

2.17.        “Holder” means a Participant to whom an Award is made.

2.18.        “Incentive Stock Option” means an Option intended to meet the requirements of an incentive stock option as defined in section 422 of the Code and designated as an Incentive Stock Option.

2.19.        “1934 Act” means the Securities Exchange Act of 1934, as amended.

2.20.        “Non-Employee Director” means a member of the Board who meets the definition of a “non-employee director” under Rule 16b-3(b)(3) promulgated by the Securities and Exchange Commission under the 1934 Act.

2.21.        “Non-Qualified Option” means an Option not intended to be an Incentive Stock Option, and designated as a Non-Qualified Option.

2.22.        “Option” means any stock option granted from time to time under Section 8 of the Plan.

2.23.        “Outside Director” means a member of the Board who meets the definition of an “outside director” under Treasury Regulation § 1.162-27(e)(3)(i).

2.24.        “Participant” means a Consultant, Director or Employee.

2.25.        “Performance Goal” means a goal that must be met by the end of a period specified by the Committee (but that is substantially uncertain to be met before the grant of an Award) based upon: (i) the price of Common Stock, (ii) the market share of the Company, its Subsidiaries or Affiliates (or any business unit thereof), (iii) sales by the Company, its Subsidiaries or Affiliates (or any business unit thereof), (iv) earnings per share of Common Stock, (v) return on shareholder equity of the Company, (vi) costs of the Company, its Subsidiaries or Affiliates (or any business unit thereof), (vii) cash flow of the Company, its Subsidiaries or Affiliates (or any business unit thereof), (viii) return on total assets of the Company, its Subsidiaries or Affiliates (or any business unit thereof), (ix) return on invested capital of the Company, its Subsidiaries or Affiliates (or any business unit thereof), (x) return on net assets of the Company, its Subsidiaries or Affiliates (or any business unit thereof), (xi) operating income of the Company, its Subsidiaries or Affiliates (or any business unit thereof), (xii) net income of the Company, its Subsidiaries or Affiliates (or any business unit thereof), or (xiii) any other goal the Committee deems appropriate.

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2.26.        “Person” means any individual, partnership, corporation, company, limited liability company, association, trust, joint venture, unincorporated organization, entity or division, or any government, governmental department or agency or political subdivision thereof.

2.27.        “Plan” means the Adolor Corporation 2003 Stock-Based Incentive Compensation Plan herein set forth, as amended from time to time.

2.28.        “Restricted Stock” means Common Stock awarded by the Committee under Section 7 of the Plan.

2.29.        “Restriction Period” means the period during which Restricted Stock awarded under Section 7 of the Plan is subject to forfeiture.

2.30.        “Retirement” means retirement from the active employment of the Company, a Subsidiary or an Affiliate pursuant to the relevant provisions of the applicable pension plan of such entity or as otherwise determined by the Board.

2.31.        “Subsidiary” means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company (or any subsequent parent of the Company) if each of the corporations other than the last corporation in the unbroken chain owns stock possession 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

2.32.        “Ten Percent Shareholder” means a Person who on any given date owns, either directly or indirectly (taking into account the attribution rules contained in section 424(d) of the Code), stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or a Subsidiary.

3.              Eligibility

Any Participant is eligible to receive an Award.

4.              Administration and Implementation of Plan

4.1.          The Plan shall be administered by the Committee, which shall have full power to interpret and administer the Plan and full authority to act in selecting the Participants to whom Awards will be granted, in determining the type and amount of Awards to be granted to each such Participant, the terms and conditions of Awards granted under the Plan and the terms of agreements which will be entered into with Holders.  Notwithstanding the foregoing, the Board may designate one or more of its members or officers of the Company to serve as a secondary committee and delegate to the secondary committee authority to grant Awards to eligible individuals who are not subject to the requirements of Rule 16b-3 under the 1934 Act or section 162(m) of the Code.  The secondary committee shall have the same authority with respect to selecting the individuals to whom such Awards are granted and establishing the terms and conditions of such Awards as the Committee has under the terms of the Plan.

4.2.          The Committee’s powers shall include, but not be limited to, the power to determine whether, to what extent and under what circumstances an Option may be exchanged for cash, Restricted Stock, Deferred Stock or some combination thereof; to determine whether, to what extent and under what circumstances an Award is made and operates on a tandem basis with other Awards made hereunder; to determine whether, to what extent and under what circumstances Common Stock or cash payable with respect to an Award shall be deferred, either automatically or at the election of the Holder (including the power to add deemed earnings to any such deferral); to grant Awards (other than Incentive Stock Options) that are transferable by the Holder; and to determine the effect, if any, of a change in control of the Company upon outstanding Awards.

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4.3.          The Committee shall have the power to adopt regulations for carrying out the Plan and to make changes in such regulations as it shall, from time to time, deem advisable.  The Committee shall have the power unilaterally and without approval of a Holder to amend an existing Award in order to carry out the purposes of the Plan so long as such an amendment does not take away any benefit granted to a Holder by the Award and as long as the amended Award comports with the terms of the Plan.  Any interpretation by the Committee of the terms and provisions of the Plan and the administration thereof, and all action taken by the Committee, shall be final and binding on Holders.

4.4.          The Committee may condition the grant of any Award or the lapse of any Deferral or Restriction Period (or any combination thereof) upon the Holder’s achievement of a Performance Goal that is established by the Committee before the grant of the Award.  The Committee shall have discretion to determine the specific targets with respect to each Performance Goal.  Before granting an Award or permitting the lapse of any Deferral or Restriction Period subject to this Section, the Committee shall certify that an individual has satisfied the applicable Performance Goal.

5.              Shares of Stock Subject to the Plan

5.1.          Subject to adjustment as provided in Section 9, the total number of shares of Common Stock available for Awards under the Plan shall be 7,600,000 shares, all of which may be granted as Incentive Stock Options.

5.2.          The maximum number of shares of Common Stock subject to Awards that may be granted to any Participant shall not exceed 750,000 during any calendar year (the “Individual Limit”).  Subject to Section 5.3, Section 9 and Section 12.7, any Award that is canceled or repriced by the Committee shall count against the Individual Limit.  Notwithstanding the foregoing, the Individual Limit may be adjusted to reflect the effect on Awards of any transaction or event described in Section 9.

5.3.          Any shares issued by the Company through the assumption or substitution of outstanding grants from an acquired company shall not (i) reduce the shares available for Awards under the Plan, or (ii) be counted against the Individual L