FOLDERA, INC.

2005 STOCK OPTION PLAN, AS AMENDED

STOCK OPTION AGREEMENT

Unless otherwise defined herein, the terms defined in the Plan shall have the
same defined meanings in this Option Agreement.

I.
NOTICE OF STOCK OPTION GRANT
     
Name
 
Address

The undersigned Optionee has been granted an Option to purchase Common Stock of
the Company, subject to the terms and conditions of the Plan and this Option
Agreement, as follows:
 
Date of Grant:
__________________
   
Exercise Price per Share:
$_________
   
Total Number of Shares Granted:
__________
   
Total Exercise Price:
$_____________
   
Type of Option:
____ Incentive Stock Option
 
___ Nonstatutory Stock Option
   
Term/Expiration Date:
____________________

 
Vesting Schedule: This Option shall be vested, in whole or in part, according to
the following schedule:

Date
Option Shares
   
_____________
__________

In addition, the Option may be subject to vesting acceleration upon certain
events as provided in Section 2(c) of the Option Agreement.

Vesting pursuant to this Vesting Schedule is subject to Optionee providing
services to the Company as a Service Provider continuously from the Grant Date
to each such vesting date.
 

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II.
AGREEMENT

 
1. Grant of Option. The Plan Administrator of the Company hereby grants to the
person (the "Optionee") named in the Notice of Stock Option Grant (the “Grant
Notice”), an option (the "Option") to purchase the number of Shares set forth in
the Notice of Grant, at the exercise price per Share set forth in the Notice of
Grant (the "Exercise Price"), and subject to the terms and conditions of the
Plan, which is incorporated herein by reference. Subject to Section 13(c) of the
Plan, in the event of a conflict between the terms and conditions of the Plan
and this Option Agreement, the terms and conditions of the Plan shall prevail.
 
If designated in the Notice of Grant as an Incentive Stock Option ("ISO"), this
Option is intended to qualify as an Incentive Stock Option as defined in Section
422 of the Code. Nevertheless, to the extent that it exceeds the $100,000 rule
of Code Section 422(d), this Option shall be treated as a Nonstatutory Stock
Option ("NSO").
 
2. Exercise of Option.
 
(a) Right to Exercise. This Option shall be exercisable during its term in
accordance with the Vesting Schedule set out in the Notice of Grant and with the
applicable provisions of the Plan and this Option Agreement.
 
(b)  Method of Exercise. This Option shall be exercisable by delivery of an
exercise notice in the form attached as Exhibit A (the "Exercise Notice") which
shall state the election to exercise the Option, the number of Shares with
respect to which the Option is being exercised, and such other representations
and agreements as may be required by the Company. The Exercise Notice shall be
accompanied by payment of the aggregate Exercise Price as to all Exercised
Shares. This Option shall be deemed to be exercised upon receipt by the Company
of such fully executed Exercise Notice accompanied by the aggregate Exercise
Price.
 
No Shares shall be issued pursuant to the exercise of an Option unless such
issuance and such exercise comply with Applicable laws. Assuming such
compliance, for income tax purposes the Shares shall be considered transferred
to the Optionee on the date on which the Option is exercised with respect to
such Shares.
 
(c) Vesting Acceleration. Upon the consummation of a Change in Control (as
defined in Section 10 below), or the involuntary termination of Optionee as a
Service Provider (other than for Cause, as defined in Section 10 below), all
unvested options, if any, of Service Provider shall become vested and
exercisable.
 
3. Term. Optionee may not exercise the Option before the commencement of its
term or after its term expires. During the term of the Option, Optionee may only
exercise the Option to the extent vested. The term of the Option commences on
the Date of Grant and expires upon the earliest of the following:
 
(a) With respect to the unvested portion of the Option, upon voluntary
termination of Optionee’s continuous service to the Company as a Service
Provider;
 

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(b) With respect to the vested portion of the Option, twenty-four (24) months
after the termination of Optionee’s continuous service to the Company as a
Service Provider for any reason other than your Disability or death;
 
(c) With respect to the vested portion of the Option, twenty-four (24) months
after the termination of Optionee’s continuous service to the Company as a
Service Provider due to your Disability or death;
 
(d) Immediately prior to the close of certain corporate transactions, pursuant
to Section 11(c) of the Plan;
 
(e) The Term/Expiration Date provided in the Notice of Grant; or
 
(f) The day before the tenth (10th) anniversary of the Date of Grant.
 
4. Optionee's Representations. In the event the Shares have not been registered
under the Securities Act of 1933, as amended, at the time this Option is
exercised, the Optionee shall, if required by the Company, concurrently with the
exercise of all or any portion of this Option, deliver to the Company an
Investment Representation Statement in a form satisfactory to the Company.

5. Lock-Up Period. Optionee hereby agrees that, if so requested by the Company
or any representative of the underwriters (the "Managing Underwriter") in
connection with any registration of the offering of any securities of the
Company under the Securities Act, Optionee shall not sell or otherwise transfer
any Shares or other securities of the Company during the 180-day period (or such
other period as may be requested in writing by the Managing Underwriter and
agreed to in writing by the Company) (the "Market Standoff Period") following
the effective date of a registration statement of the Company filed under the
Securities Act. Such restriction shall apply only to the first registration
statement of the Company to become effective under the Securities Act that
includes securities to be sold on behalf of the Company to the public in an
underwritten public offering under the Securities Act. The Company may impose
stop-transfer instructions with respect to securities subject to the foregoing
restrictions until the end of such Market Standoff Period.
 
6. Method of Payment. Payment of the aggregate Exercise Price shall be by any of
the following, or a combination thereof, at the election of the Optionee:
 
(a) cash or check;
 
(b) consideration received by the Company under a cashless exercise program
adopted by the Company in connection with the Plan;
 
(c) surrender of other Shares which, (i) in the case of Shares acquired upon
exercise of an option, have been owned by the Optionee for such period of time
on the date of surrender that will avoid a compensation expense for financial
accounting purposes, and (ii) have a Fair Market Value on the date of surrender
equal to the aggregate Exercise Price of the Exercised Shares; or
 

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(d)  at the Company’s discretion, cancellation of a number of Shares subject to
the Option which have vested and are being exercised equal to the largest number
of whole Shares that has a Fair Market Value that does not exceed the aggregate
Exercise Price.   With respect to any remaining balance of the aggregate
Exercise Price, the Company shall accept a cash payment from the Optionee. The
Shares used to pay the aggregate Exercise Price under this provision will be
considered to have resulted from the exercise of the Option, and accordingly,
the Option will not again be exercisable with respect to such Shares.
 
7. Restrictions on Exercise. This Option may not be exercised until such time as
the Plan has been approved by the shareholders of the Company, or if the
issuance of such Shares upon such exercise or the method of payment of
consideration for such shares would constitute a violation of any Applicable
Law.
 
8. Non-Transferability of Option. This Option may not be transferred in any
manner otherwise than by will or by the laws of descent or distribution and may
be exercised during the lifetime of Optionee only by Optionee. The terms of the
Plan and this Option Agreement shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.
 
9. Tax Obligations.
 
(a) Tax Consequences. The Optionee acknowledges that Optionee is solely
responsible for the tax consequences of receiving the grant of this Option,
exercising this Option and the transfer or disposal of any Shares received upon
the exercise of this Option. THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE
EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.
 
(b) Withholding Taxes. Optionee agrees to make appropriate arrangements with the
Company (or the Parent or Subsidiary employing or retaining Optionee) for the
satisfaction of all Federal, state, local and foreign income and employment tax
withholding requirements applicable to the Option exercise. Optionee
acknowledges and agrees that the Company may refuse to honor the exercise and
refuse to deliver Shares if such withholding amounts are not delivered at the
time of exercise.
 
(c)  Share Withholding. Unless otherwise agreed by the Optionee and the Company
in writing, the Company, in compliance with any applicable legal conditions or
restrictions, may, in its sole discretion, withhold from fully vested Shares
purchased through the exercise of the Option, otherwise deliverable to Optionee
through the exercise of the Option, a whole number of Shares having a Fair
Market Value, as determined by the Company as of the date of exercise, not in
excess of the amount of tax required to be withheld by law (or such lower amount
as may be necessary to avoid adverse financial accounting treatment). To the
extent that the withholding of the Shares is less than the tax withholding
amount, the Optionee agrees to pay the remainder of the tax withholding in cash
or check or to have such amount withheld by the Company from the Optionee’s
compensation through payroll and any other amounts payable to Optionee.
 
(d)  Notice of Disqualifying Disposition of ISO Shares. If the Option granted to
Optionee herein is an ISO, and if Optionee sells or otherwise disposes of any of
the Shares acquired pursuant to the ISO on or before the later of (1) the date
two years after the Date of Grant, or (2) the date one year after the date of
exercise, the Optionee shall immediately notify the Company in writing of such
disposition. Optionee agrees that Optionee may be subject to income tax
withholding by the Company on the compensation income recognized by the
Optionee.
 

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10. Definitions.
 
(a) “Cause” shall, with respect to the Optionee, have the equivalent meaning or
the same meaning as “cause,” “for cause” or any equivalent term set forth in any
employment, consulting, or other agreement for the performance of services
between the Optionee and the Company or any Subsidiary or, in the absence of any
such definition in such agreement, such term shall mean (i) the Optionee’s (1)
willful failure to perform his material duties as an employee of the Company or
a material breach of a material term of this Agreement and (2) failure to “cure”
any such breach or default within thirty (30) days after receipt of written
notice from the Company specifying such breach or default and the specific steps
necessary to cure such breach or default; (ii) the commission of an act of
fraud, embezzlement or material dishonesty that results in substantial personal
enrichment to the Optionee; (iii) the Optionee’s conviction of, or plea of nolo
contendere to a felony; (iv) the Optionee’s gross negligence or breach of
fiduciary duty that results in material harm to the Company; (v) the material
breach of a material term of the Optionee’s confidential information and
invention assignment, non-solicitation, non-disclosure and/or other similar
agreement with the Company or any Subsidiary or (vi) the commission of an act
which constitutes competition with the Company or any of its Subsidiaries.
 
(b) “Change in Control” means and shall be deemed to have occurred on the
earliest of the following dates:
 
(i) the date on which any “person” (as such term is used in Sections 13(d) and
14(d) of the Exchange Act), other than Richard Lusk or Suyen Castellon or Vision
Opportunity Master Fund, obtains “beneficial ownership” (as defined in
Rule 13d-3 of the Exchange Act) or a pecuniary interest in fifty percent (50%)
or more of the combined voting power of the Company’s then outstanding
securities (“Voting Stock”);
 
(ii) the consummation of a merger, consolidation, reorganization or similar
transaction other than a transaction: (1) in which substantially all of the
holders of Company’s Voting Stock hold or receive directly or indirectly fifty
percent (50%) or more of the voting stock of the resulting entity or a parent
company thereof, in substantially the same proportions as their ownership of the
Company immediately prior to the transaction; or (2) in which the holders of
Company’s capital stock immediately before such transaction will, immediately
after such transaction, hold as a group on a fully diluted basis the ability to
elect at least a majority of the directors of the surviving corporation (or a
parent company);
 
(iii) there is consummated a sale, lease, exclusive license or other disposition
of all or substantially all of the consolidated assets of the Company and its
Subsidiaries, other than a sale, lease, license or other disposition of all or
substantially all of the consolidated assets of the Company and its Subsidiaries
to an entity, fifty percent (50%) or more of the combined voting power of the
voting securities of which are owned by shareholders of the Company in
substantially the same proportions as their ownership of the Company immediately
prior to such sale, lease, license or other disposition; or
 
(iv) individuals who, on the date this Plan is adopted by the Board, are
Directors (the “Incumbent Board”) cease for any reason to constitute at least a
majority of the Directors; provided, however, that if the appointment or
election (or nomination for election) of any new Director was approved or
recommended by a majority vote of the members of the Incumbent Board then still
in office, such new member shall, for purposes of this Plan, be considered as a
member of the Incumbent Board.
 

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For purposes of determining whether a Change in Control has occurred, a
transaction includes all transactions in a series of related transactions, and
terms used in this definition but not defined are used as defined in the Plan.
The term Change in Control shall not include a sale of assets, merger or other
transaction effected exclusively for the purpose of changing the domicile of the
Company.

(c)“Good Reason” shall, with respect to any Optionee, have the equivalent
meaning (or the same meaning as “good reason,” “constructive termination,” “for
good reason” or any equivalent term) set forth in any employment, consulting or
other agreement for the performance of services between the Optionee and the
Company or any Subsidiary or, in the absence of any such definition in such
agreement, such term shall mean (i) the assignment to the Optionee of any duties
inconsistent in any material respect with the Optionee’s position (including
status, offices, titles and reporting requirements), authority, duties or
responsibilities as assigned by the Company or any Subsidiary, or any other
action by the Company (or any Subsidiary) which results in a material diminution
in such duties or responsibilities, excluding for this purpose an isolated,
insubstantial and inadvertent action not taken in bad faith and which is
remedied by the Company (or any Subsidiary) promptly after receipt of notice
thereof given by the Optionee. For purposes of clarification, if, after a Change
in Control, the Optionee does not have the same title and position with the
successor entity, or, if applicable, its ultimate parent, then the Optionee will
have suffered a material diminution of Optionee’s duties which will qualify as
Good Reason pursuant to this paragraph; (ii) any failure by the Company (or any
Subsidiary) to comply with its material obligations to the Optionee as provided
in any written agreement between the Optionee and the Company, other than an
isolated, insubstantial and inadvertent failure not occurring in bad faith and
which is remedied by the Company (or any Subsidiary) promptly after receipt of
notice thereof given by the Optionee; (iii) the Company’s (or any Subsidiary’s)
requiring the Optionee to be based at any office or location more than
thirty-five (35) miles from the location of employment as of the date
immediately prior to the Change in Control, except for travel reasonably
required in the performance of the Optionee’s responsibilities; or (iv) any
reduction in the Optionee’s base salary.

11. Entire Agreement, Governing Law. The Plan is incorporated herein by
reference. The Plan and this Option Agreement constitute the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the
Optionee's interest except by means of a writing signed by the Company and
Optionee. This Option Agreement is governed by the internal substantive laws but
not the choice of law rules of California.
 
12. No Guarantee of Continued Service. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE
VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY
CONTINUNG AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT
OF BEING HIRED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER).
OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS
CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT
CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE
PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT
INTERFERE IN ANY WAY WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE
OPTIONEE'S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT
CAUSE.
 

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Optionee acknowledges receipt of a copy of the Plan and represents that he or
she is familiar with the terms and provisions thereof, and hereby accepts this
Option subject to all of the terms and provisions thereof. Optionee has reviewed
the Plan and this Option in their entirety, has had an opportunity to obtain the
advice of counsel prior to executing this Option and fully understands all
provisions of the Option. Optionee hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Administrator upon
any questions arising under the Plan or this Option. Optionee further agrees to
notify the Company upon any change in the residence address indicated below.

OPTIONEE:
 
FOLDERA, INC.
     
 
 
 
Signature
 
By
     
 
 
 
Print Name
 
Title

 
 

Residence Address
   

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