EMPLOYMENT AGREEMENT

  

THIS EMPLOYMENT AGREEMENT (this “Agreement”), made and entered into this 16 day
of June, 2014, by and between eCrypt Technologies, Inc., a Colorado corporation
d/b/a Ecrypt Technologies, Inc. (“Company”), and Thomas Cellucci (“Executive”),
an individual residing at 42757 Cedar Ridge Blvd, Chantilly, VA 20152.

  

RECITALS

  

WHEREAS, the Company wishes to employ the Executive as its Chief Executive
Officer (“CEO”);

WHEREAS, the Executive possesses the necessary skills to fulfill that need; and

WHEREAS, the parties desire and agree to enter into this Agreement with
Executive setting forth the terms and conditions upon which Executive shall
serve as CEO and a Director of the Company.

  

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants
and obligations hereinafter set forth, the parties hereto, intending to be
legally bound, hereby agree as follows:

  

1.

Employment.

(a)

Position.  The Company hereby agrees to employ the Executive to serve in the
role of Chief Executive Officer.  The Executive accepts such employment upon the
terms and conditions hereinafter set forth, and further agrees to perform to the
best of his ability the duties associated with such position as determined by
the Company’s Board of Directors (the “Board”), in its sole discretion.

(b)

Board Seat.

During the Executive’s employment hereunder it is expected and anticipated that
he will serve as a member on the Board as a Director.

(c)

Devotion to Duties.  While the Executive is employed hereunder, he will use his
best efforts, skills and abilities to perform faithfully all duties assigned to
him pursuant to this Agreement and will devote sufficient business time and
energies to the business and affairs of the Company.  While he is employed
hereunder, Executive may undertake any other employment, consultancy,
directorship or other work engagement with any person or entity provided that
such employment, consultancy, directorship, or other engagement does not in any
way conflict with or compete with the business operations of the Company.  

 (d)

Administrative Activities.  The Executive’s administrative activities will at
all times be subject to the relevant provisions of the policies and the bylaws,
rules and regulations of the Company.  The Executive will at all times render
his administrative services in a competent and professional manner, consistent
with the standards of the Company and in compliance with all applicable
statutes, regulations, rules and directives of federal, state and other
governmental and regulatory bodies having jurisdiction over the Executive.

2.

Compensation.

(a)

Stock Grant.  While Executive is employed hereunder, the Company shall issue
Executive up to a total of up to eighteen million nine hundred and sixty five
thousand and four hundred and eight

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(18,965,408) shares of common stock, which shares shall be issued as follows:
(i) nine million four hundred and eighty two thousand and seven hundred and four
(9,482,704) shares of common stock pursuant to the terms and conditions of the
Restricted Shares Agreement in the form attached hereto as Exhibit A; and (ii)
 nine million four hundred and eighty two thousand and seven hundred and four
(9,482,704) of common stock pursuant to a restricted shares agreement once the
Company either (a) amends its existing Stock Compensation Program (the
“Program”) to increase the number of maximum authorized shares which may be
issued under the Program, or (b) adopts a new stock compensation program.

(b)

Performance Bonus.  The Executive shall be eligible to receive a discretionary
annual bonus (the “Performance Bonus”) at the conclusion of each year of
employment with the Company. The amount and award of the Performance Bonus shall
be at the discretion of the Board (or any committee established by the Board to
determine executive compensation), and shall be based in part on the attainment
of individual and Company-wide performance goals established by the Board (or
any applicable committee).  The Performance Bonus shall be paid during the
quarter immediately following the Company’s fiscal year end.

 (c)

Fringe Benefits.  The Executive will be entitled to participate in employee
benefit plans that the Company provides or may establish for the benefit of its
executives generally (for example, life and disability insurance, health,
pension, retirement (401K), and accident plans) (collectively, the “Fringe
Benefits”).  The Executive’s eligibility to participate in the Fringe Benefits
and receive benefits thereunder will be subject to the plan documents governing
such Fringe Benefits.  Nothing contained herein will require the Company to
establish or maintain any Fringe Benefits.  The Company reserves the right, in
its discretion, to amend or terminate such Fringe Benefits.

(d)

Reimbursement of Expenses.  Upon presentation of documentation of such expenses
reasonably satisfactory to the Company, the Company will reimburse the Executive
for all ordinary and reasonable out-of-pocket business expenses that are
reasonably incurred by the Executive in furtherance of the Company’s business in
accordance with the Company’s policies with respect thereto as in effect from
time to time.  In order to receive reimbursement, the Executive must present
documentation of the expenses within a reasonable time period after incurring
such expenses.

3.

At Will Employment. THE PARTIES HERETO ACKNOWLEDGE AND AGREE THAT EXECUTIVE’S
EMPLOYMENT IS AT-WILL AND EITHER THE COMPANY OR THE EXECUTIVE MAY TERMINATE
EXECUTIVE’S EMPLOYMENT WITH OR WITHOUT CAUSE AT ANY TIME, AND WITHOUT ADVANCED
NOTICE, PROCEDURE OR FORMALITY.  THIS AT-WILL EMPLOYMENT RELATIONSHIP WILL
REMAIN IN EFFECT THROUGHOUT THE EXECUTIVE’S EMPLOYMENT WITH THE COMPANY.  THE
AT-WILL NATURE OF EXECUTIVE’S EMPLOYMENT CANNOT BE MODIFIED BY ANY ORAL OR
IMPLIED AGREEMENT, AND NO EMPLOYEE HANDBOOK, NOR ANY COURSE OF CONDUCT,
PRACTICE, POLICY, AWARD, PROMOTION, PERFORMANCE EVALUATION, TRANSFER, OR LENGTH
OF SERVICE SHALL BE DEEMED TO MODIFY THIS AT-WILL RELATIONSHIP.  

4.

Confidential Information.

The Executive recognizes and acknowledges that the Executive will have access to
Confidential Information (as defined below) relating to the business or
interests of the Company or of persons with whom the Company may have business
relationships. Except as permitted herein, the Executive will not during the
Term of this Agreement, or at any time following termination of this Agreement,
disclose or permit to be known to any other person or entity (except as required
by applicable law or in connection with the performance of the Executive's
duties and responsibilities hereunder), or use for the Executive's

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own improper benefit or gain, any Confidential Information of the Company. The
term "Confidential Information" includes, without limitation, information
relating to the Company's business affairs, proprietary technology, trade
secrets, patented processes, research and development data, know-how, market
studies and forecasts, competitive analyses, pricing policies, employee lists,
employment agreements, personnel policies, the substance of agreements with
customers, commercial contracts, suppliers and others, marketing arrangements,
and customer lists and information relating to business operations and strategic
plans of third parties with which the Company has or may be assessing commercial
arrangements, any of which information is not generally known to the public or
to actual or potential competitors of the Company (other than through a breach
of this Agreement). Therefore, the Executive will not, without the prior written
consent of the Company's Board of Directors, disclose such Confidential
Information or use the same, provided, however, that in the course of the
Executive's services to the Company, the Executive may disclose such
Confidential Information as the Executive deems necessary to carry out the
Executive's duties to the Company. This obligation shall continue until such
Confidential Information becomes publicly available, other than pursuant to a
breach of this Section 4 by the Executive, regardless of whether the Executive
continues to be employed by the Company. It is further agreed and understood by
and between the parties to this Agreement that all information and records
relating to the Company, as hereinabove described, shall be the exclusive
property of the Company and, upon termination of the Executive's employment with
the Company, all documents, records, reports, writings and other similar
documents containing Confidential Information, including copies thereof, then in
the Executive's possession or control shall be returned to and left with the
Company.

5.

Non-Disparagement.

(a)

The Executive hereby agrees that during the course of the Executive’s employment
with the Company and at all times thereafter, the Executive will not make any
statement that is professionally or personally disparaging about, or adverse to,
the interests of the Company, any of its officers, directors, shareholders or
employees including, but not limited to, any statement that disparages any
person, product, service, finances, financial condition, capabilities or other
aspect of the business of the Company or any of its officers, directors,
shareholders or employees.  The Executive further agrees that during the course
of the Executive’s employment with the Company and at all times thereafter, the
Executive will not engage in any conduct that is intended to or has the result
of inflicting harm upon the professional or personal reputation of the Company
or any of its officers, directors, shareholders or employees.

(b)

The Company hereby agrees that during the course of the Executive’s employment
with the Company and at all times thereafter, the Company’s officers and
directors will not make any statements that are professionally or personally
disparaging about, or adverse to, the interests of the Executive including, but
not limited to, any statement that disparages the Executive’s personal or
professional interests or reputation.  The Company further agrees that during
the course of the Executive’s employment with the Company and at all times
thereafter, the Company’s officers and directors will not engage in any conduct
that is intended to or has the result of inflicting harm upon the professional
or personal reputation of the Executive.

6.

Records.  

Upon termination of the Executive’s employment hereunder for any reason or for
no reason and at any other time requested by the Company, the Executive will
deliver to the Company any property of the Company that may be in his
possession, including products, materials, memoranda, notes, records, reports,
or other documents or photocopies of the same.

7.

Representations.  

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The Executive hereby represents and warrants to the Company that he understands
this Agreement, that he enters into this Agreement voluntarily and that his
employment under this Agreement will not conflict with any legal duty owed by
him to any other party, or with any agreement to which the Executive is a party
or by which he is bound, including, without limitation, any non-competition or
non-solicitation provision contained in any such agreement.  The Executive will
indemnify and hold harmless the Company and its officers, directors, security
holders, partners, members, employees, agents and representatives against loss,
damage, liability or expense arising from any claim based upon circumstances
alleged to be inconsistent with such representation and warranty.

8.

General.

(a)

Notices.  All notices, requests, consents and other communications hereunder
that are required to be provided, or that the sender elects to provide, in
writing, will be addressed to the receiving party’s address set forth below or
to such other address as a party may designate by notice hereunder:   

To Executive:

  

Thomas Cellucci

42757 Cedar Ridge Blvd.

Chantilly, VA  20152

tom@cellucciassociates.com

To Company:

Ecrypt Technologies Inc.

C/O Frascona, Joiner, Goodman and Greenstein

4750 Table Mesa Drive

Boulder, CO  80305

jons@frascona.com

  

Notices will be either (i) delivered by hand, (ii) sent by overnight courier,
(iii) sent by registered or certified mail, return receipt requested, postage
prepaid; or (iv) sent via electronic correspondence.  All notices, requests,
consents and other communications hereunder will be deemed to have been given
either (i) if by hand, at the time of the delivery thereof to the receiving
party at the address of such party set forth above, (ii) if sent by overnight
courier, on the next business day following the day such notice is delivered to
the courier service, or (iii) if sent by registered or certified mail, on the
fifth business day following the day such mailing is made.

(b)

Entire Agreement. This Agreement, along with any agreements referenced herein,
embodies the entire agreement and understanding between the parties hereto with
respect to the subject matter hereof and supersedes all prior oral or written
agreements and understandings relating to the subject matter hereof.  No
statement, representation, warranty, covenant or agreement of any kind not
expressly set forth in this Agreement will affect, or be used to interpret,
change or restrict, the express terms and provisions of this Agreement.

(c)

Modifications and Amendments.  The terms and provisions of this Agreement may be
modified or amended only by written agreement executed by the parties hereto.

(d)

Waivers and Consents.  The terms and provisions of this Agreement may be waived,
or consent for the departure therefrom granted, only by written document
executed by the party entitled to the benefits of such terms or provisions.  No
such waiver or consent will be deemed to be or will constitute a waiver or
consent with respect to any other terms or provisions of this Agreement, whether
or not similar.  

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Each such waiver or consent will be effective only in the specific instance and
for the purpose for which it was given, and will not constitute a continuing
waiver or consent.

(e)

Assignment.  The Executive acknowledges and agrees that the rights and
obligations of the Company under this Agreement may be assigned by the Company
to any affiliates or successors in interest.  The Executive further acknowledges
and agrees that this Agreement is personal to the Executive and that the
Executive may not assign any rights or obligations hereunder.

(f)

Benefit.  All statements, representations, warranties, covenants and agreements
in this Agreement will be binding on the parties hereto and will inure to the
benefit of the respective successors and permitted assigns of each party hereto.
 Nothing in this Agreement will be construed to create any rights or obligations
except for the Executive’s obligations to the Company as set forth herein, and
no person or entity (except for a Company affiliate or successor in interest, as
set forth herein) will be regarded as a third-party beneficiary of this
Agreement.

(g)

Seal and Governing Law.  This Agreement shall take effect as an instrument under
seal, and the Agreement and the rights and obligations of the parties hereunder
will be construed in accordance with and governed by the law of the State of
Colorado, without giving effect to the conflict of law principles thereof.  

(h)

Jurisdiction, Venue and Service of Process.  Any legal action or proceeding with
respect to this Agreement will be brought in the courts of the State of Colorado
or of the United States of America for the State of Colorado.  By execution and
delivery of this Agreement, each of the parties hereto accepts for itself and in
respect of its property, generally and unconditionally, the exclusive
jurisdiction of the aforesaid courts.

(i)

WAIVER OF JURY TRIAL.  ANY ACTION, DEMAND, CLAIM OR COUNTERCLAIM ARISING UNDER
OR RELATING TO THIS AGREEMENT WILL BE RESOLVED BY A JUDGE ALONE AND EACH OF THE
EXECUTIVE AND THE COMPANY WAIVE ANY RIGHT TO A JURY TRIAL THEREOF.

 (j)

Severability.  The parties intend this Agreement to be enforced as written.
 However, (i) if any portion or provision of this Agreement is to any extent
declared illegal or unenforceable by a duly authorized court having
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, will not be affected thereby, and each
portion and provision of this Agreement will be valid and enforceable to the
fullest extent permitted by law and (ii) if any provision, or part thereof, is
held to be unenforceable because of the duration of such provision, the
geographic area covered thereby, or other aspect or scope of such provision, the
court making such determination will have the power to reduce the duration,
geographic area of such provision, or other aspect or scope of such provision,
and/or to delete specific words and phrases (“blue-penciling”), and in its
reduced or blue-penciled form, such provision will then be enforceable and will
be enforced.

(k)

Headings and Captions.  The headings and captions of the various subdivisions of
this Agreement are for convenience of reference only and will in no way modify
or affect the meaning or construction of any of the terms or provisions hereof.
Throughout this Agreement, where such meanings would be appropriate: (a) the
masculine gender shall be deemed to include the feminine and the neuter and vice
versa, and (b) the singular shall be deemed to include the plural, and vice
versa.  

(l)

Injunctive Relief.  The Executive hereby expressly acknowledges that any breach
or threatened breach of any of the terms and/or conditions set forth in Section
4 of this Agreement will result in

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[exhibit1016ecryptemployme001.jpg] [exhibit1016ecryptemployme001.jpg]

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RESTRICTED SHARES AGREEMENT

THIS RESTRICTED SHARES AGREEMENT (the “Agreement”) dated the 16 day of June 2014
between eCrypt Technologies, Inc., a Colorado corporation d/b/a Ecrypt
Technologies, Inc.,  (“Company”), and Thomas Cellucci (“Grantee”).

1.

Grant of Restricted Shares.  The Company hereby grants to Grantee effective as
of ­­June 16, 2014 (“Grant Date”), nine million four hundred and eighty two
thousand and seven hundred and four (9,482,704) shares (“Restricted Shares”) of
the Company's common stock (“Shares”).  This grant of Restricted Shares shall be
subject to the applicable terms and conditions set forth below and is being
granted pursuant to the eCrypt Technologies, Inc. Restricted Share Plan
(“Plan”), which Plan is part of the eCrypt Technologies, Inc. Stock Compensation
Program (“Program”).  The capitalized terms in this Agreement shall be defined
in the provisions provided under the Program.  As used in this Agreement, the
term “Restricted Shares” refers only to those shares granted to Grantee
hereunder as to which the forfeiture and transfer restrictions set forth in
Section 2 hereof have not lapsed.

2.

Restrictions During Restriction Period.

a.

Forfeiture.  The Restricted Shares shall be forfeited and transferred to the
Company upon the Grantee's termination of service with the Company within the
“Restriction Period” (as defined below).

b.

Transfer Restrictions.  None of the Restricted Shares shall be sold, assigned,
pledged, or otherwise transferred, voluntarily or involuntarily, by the Grantee
during the “Restriction Period”.

c.

Restriction Period.  For purposes of this Agreement, the term “Restriction
Period” shall mean the period commencing on the Grant Date and ending on the 28
month anniversary of the Grant Date.

d.

Lapse of Restrictions.  The restrictions set forth in the above portion of this
Section 2 shall lapse and no longer apply upon the earlier of (i) the expiration
of the Restriction Period; (ii)the occurrence of a “Corporate Transaction” as
described below; or (iii) the termination of service of the Grantee with the
approval of the Board of Directors for purposes of the Plan.

In addition to the above events, the restrictions shall lapse as follows: (i)
upon the mutual execution of this Agreement with respect to one million one
hundred eighty five thousand three hundred and thirty eight (1,185,338) of the
Restricted Shares; (ii) on the four (4) month anniversary of the Grant Date with
respect to one million one hundred eighty five thousand three hundred and thirty
eight (1,185,338)  of the Restricted Shares; (iii) on the eight (8) month
anniversary of the Grant Date with respect to one million one hundred eighty
five thousand three hundred and thirty eight (1,185,338)  of the Restricted
Shares; or (iv) on the twelve (12) month anniversary of the Grant Date with
respect to one million one hundred eighty five thousand three hundred and thirty
eight (1,185,338)  of the Restricted Shares; (v) on the sixteen (16) month
anniversary of the Grant Date with respect to one million one hundred eighty
five thousand three hundred and thirty eight (1,185,338) of the Restricted
Shares; (vi) on the twenty (20) month anniversary of the Grant Date with respect
to one million one hundred eighty five thousand three

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hundred and thirty eight (1,185,338)  of the Restricted Shares; (vii) on the
twenty four (24) month anniversary of the Grant Date with respect to one million
one hundred eighty five thousand three hundred and thirty eight (1,185,338) of
the Restricted Shares; or (viii) on the twenty eight (28) month anniversary of
the Grant Date with respect to one million one hundred eighty five thousand
three hundred and thirty eight (1,185,338) of the Restricted Shares

3.

Issuance of Shares; Registration; Withholding Taxes.  As part of the grant under
this Agreement, certificates for the Restricted Shares shall be issued in the
Grantee's name and shall be held in escrow by the Company until all restrictions
lapse or such shares are forfeited as provided herein.  A certificate or
certificates representing the Restricted Shares as to which restrictions have
lapsed shall be delivered to the Grantee upon such lapse.

The Company may postpone the issuance or delivery of the Shares until (i) the
receipt by the Company of such written representations or other documentation as
the Company deems necessary to establish compliance with all applicable laws,
rules and regulations, including applicable federal and state securities laws
and listing requirements, if any; and (ii) the payment to the Company, upon its
demand, of any amount requested by the Company to satisfy any federal, state or
other governmental withholding tax requirements related to the issuance or
delivery of the Shares.  Grantee shall comply with any and all legal
requirements relating to Grantee’s resale or other disposition of any Shares
acquired under this Agreement.  The certificates representing the Shares may
bear such legend as described in Section 6 and as counsel to the Company
otherwise deems appropriate to assure compliance with applicable law.

4.

Changes in Capitalization; Reorganization.

a.

Adjustments.  The number of Restricted Shares shall be adjusted proportionately
for any increase or decrease in the number of issued shares of Common Stock by
reason of stock dividends, split-ups, recapitalizations, or other capital
adjustments.  Notwithstanding the foregoing, (i) no adjustment shall be made,
unless the Committee determines otherwise, if the aggregate effect of all such
increases and decreases occurring in any fiscal year is to increase or decrease
the number of issued shares by less than five percent (5%) and (ii) any right to
fractional shares resulting from any such adjustment shall be eliminated.

b.

Corporate Transactions.  Pursuant to Article 13 of the Program, in the event of
(i) a dissolution or liquidation of the Company, (ii) merger or consolidation or
reorganization of the Company in which the Company is not the surviving
corporation, (iii) a merger or consolidation or reorganization in which the
Company is the surviving corporation but after which the shareholders cease to
own their shares in the Company, (iv) the sale of substantially all of the
assets of the Company, (v) the acquisition, sale, or transfer of more than fifty
percent (50%) of the outstanding shares of the Company (herein referring to (i)
through (v) as “Corporate Transaction”), or (vi) the Board of Directors of the
Company proposes that the Company enter into a Corporate Transaction, then the
Committee may in its discretion accelerate the dates upon which any or all
outstanding restrictions on the Restricted Shares granted to Grantee shall
lapse.

Whenever deemed appropriate by the Committee, any action referred to in this
Section 4(b) may be made conditional upon the consummation of the applicable
Corporate Transaction.

c.

Committee Determination.  Any adjustments or other action pursuant to this
Section 4 shall be made by the Committee, and the Committee’s determination as
to what adjustments shall be made or actions taken, and the extent thereof,
shall be final and binding.

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5.

Rights as Shareholder.  The Grantee shall be entitled to all of the rights of a
shareholder with respect to the Restricted Shares, including the right to vote
such Shares and to receive dividends and other distributions (not including
Share adjustments as described in Section 4(a) above) payable with respect to
such Shares since the Grant Date.

6.

Legends.  All certificates evidencing Shares acquired under this Agreement in an
unregistered transaction shall bear the following legend (and such other
restrictive legends as are required or deemed advisable under the provisions of
any applicable law):

THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED
WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF
COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS
NOT REQUIRED.  THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK
REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND CONDITIONS (INCLUDING
FORFEITURE) OF RESTRICTED SHARE AGREEMENT ENTERED INTO BETWEEN THE REGISTERED
OWNER AND ECRYPT TECHNOLOGIES, INC. COPIES OF SUCH AGREEMENT ARE ON FILE IN THE
OFFICES OF ECRYPT TECHNOLOGIES, INC.

If, in the opinion of the Company and it counsel, any legend placed on a stock
certificate representing Shares sold under this Agreement is no longer required,
the Grantee under such certificate shall be entitled to exchange such
certificate for a certificate representing the same number of Shares but without
such legend.

7.

83(b) ELECTION. Under Section 83 of the Internal Revenue Code of 1986, as
amended (the “Code”), the difference between the purchase price paid for the
Restricted Shares and their Fair Market Value on the date any forfeiture
restrictions applicable to such shares lapse will be reportable as ordinary
income at that time.  Grantee may elect to be taxed at the time the shares are
acquired rather than when such shares cease to be subject to such forfeiture
restrictions by filing an election under Section 83(b) of the Code with the
Internal Revenue Service within the 30 days following the date Grantee acquires
the Restricted Shares.  Grantee will have to make a tax payment to the extent
the purchase price is less than the Fair Market Value of the shares on the
acquisition date.  No tax payment will have to be made to the extent the
purchase price is at least equal to the Fair Market Value of the shares on the
date the Grantee acquired the Restricted Shares.  The form and instructions for
making this election are attached as Exhibit A hereto.  Failure to make this
filing within the 30-day period will result in the recognition of ordinary
income by Grantee (in the event the Fair Market Value of the shares increases
after the date of acquisition) as the forfeiture restrictions lapse.

GRANTEE ACKNOWLEDGES THAT IT IS HIS SOLE RESPONSIBILITY, AND NOT THE COMPANY’S,
TO FILE A TIMELY ELECTION UNDER SECTION 83(b), EVEN IF GRANTEE REQUESTS THE
COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON HIS BEHALF.  GRANTEE IS
RELYING SOLELY ON HIS OWN ADVISORS WITH RESPECT TO THE DECISION AS TO WHETHER OR
NOT TO FILE ANY 83(b) ELECTION.

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EXHIBIT A

ELECTION UNDER SECTION 83(b) OF
THE INTERNAL REVENUE CODE

THE UNDERSIGNED hereby makes an election pursuant to Section 83(b) of the
Internal Revenue Code with respect to the property described below and supplies
the following information in accordance with the regulations promulgated
thereunder:

1.

The name, address and social security number of the undersigned:

Name:________________________________________________

Address: ______________________________________________

______________________________________________________

Social Security No.: _____________________________________

2.

Description of property with respect to which the election is being made:

____________ shares of common stock, no par value, of _____________, Inc. a
Colorado corporation, (the “Company”).

3.

The date on which the property was transferred is ________ __, 20__.

4.

The taxable year to which this election relates is calendar year 20__.

5.

Nature of restrictions to which the property is subject:

The shares of stock are subject to a Restricted Stock Agreement between the
undersigned and the Company.  The shares of stock are subject to forfeiture
under the terms of such agreement.

6.

The fair market value of the property at the time of transfer (determined
without regard to any lapse restriction) was $__________ per share, for a total
of $__________.

7.

The amount paid by taxpayer for the property was $__________.

8.

A copy of this statement has been furnished to ___________________.

Dated:  _____________, 20__

________________________________________

[NAME OF HOLDER]

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PROCEDURES FOR MAKING ELECTION

UNDER INTERNAL REVENUE CODE SECTION 83(b)

The following procedures must be followed with respect to the attached form for
making an election under Internal Revenue Code section 83(b) in order for the
election to be effective:

1.

You must file one copy of the completed election form with the IRS Service
Center where you file your federal income tax returns within 30 days after the
date you acquire your Restricted Stock.

2.

At the same time you file the election form with the IRS, you must also give a
copy of the election form to the Secretary of the Company.

3.

You must file another copy of the election form with your federal income tax
return (e.g. Form 1040) for the taxable year in which the stock is transferred
to you.

*  *  *  *  *