Exhibit 10.142

HALO TECHNOLOGY HOLDINGS

2006 EQUITY INCENTIVE PLAN

WHEREAS, Halo Technology Holdings, Inc. (the “Company” or “Halo Technology
Holdings”) desires to have the ability to award certain equity-based benefits to
certain of the employees, consultants and directors of the Company and its
affiliates;

NOW, THEREFORE, the Halo Technology Holdings 2006 Equity Incentive Plan is
hereby adopted under the following terms and conditions:

1. Purpose. The Plan is intended to provide a means whereby the Company may
grant ISOs to employees, and grant NQSOs, Restricted Stock, Restricted Stock
Units, Stock Appreciation Rights, Performance Stock, Contract Stock, Bonus Stock
and Dividend Equivalent Rights to employees, consultants and directors. Thereby,
the Company expects to attract and retain such individuals and to motivate them
to exercise their best efforts on behalf of the Company and its affiliates.

2. Definitions

(a) “Award” shall mean ISOs, NQSOs, Restricted Stock, Restricted Stock Units,
Stock Appreciation Rights, Performance Stock, Contract Stock, Bonus Stock and/or
Dividend Equivalent Rights awarded by the Committee to a Participant.

(b) “Award Agreement” shall mean a written document evidencing the grant of an
Award, as described in Section 10.1.

(c) “Board” shall mean the Board of Directors of the Company.

(d) “Bonus Stock” shall mean an Award that entitles the recipient to receive
Shares without payment, as a bonus.

(e) “Cause” shall mean the Company or an affiliate having cause to terminate a
Participant’s employment or service under any existing employment or any other
agreement between the Participant and the Company or an affiliate or, in the
absence of such an agreement, upon (i) the determination by the Committee that
the Participant has ceased to perform his duties to the Company or an affiliate
(other than as a result of his incapacity due to physical or mental illness or
injury), which failure amounts to an intentional and extended neglect of his
duties to such party, (ii) the Committee’s determination that the Participant
has engaged or is about to engage in conduct materially injurious to the Company
or an affiliate or (iii) the Participant having been convicted of a felony.

(f) “Code” shall mean the Internal Revenue Code of 1986, as amended.

(g) “Committee” shall mean the Company’s Compensation Committee of the Board,
which shall consist solely of not fewer than two directors of the Company who
shall be appointed by, and serve at the pleasure of, the Board (taking into
consideration the rules under section 16(b) of the Exchange Act and the
requirements of section 162(m) of the Code).

(h) “Company” shall mean Halo Technology Holdings, Inc., a Nevada corporation.

(i) “Contract Date” shall mean the date specified in the Award Agreement on
which a Participant is entitled to receive Contract Stock, provided he or she is
still providing services to the Company or an affiliate on such date.

(j) “Contract Stock” shall mean an Award that entitles the recipient to receive
unrestricted Shares, without payment, if the recipient is still providing
services to the Company or a Related Corporation as of a future date specified
in the Award Agreement.

 

(k) “Disability” shall mean separation from service as a result of a
Participant’s “permanent and total disability,” as defined in section 22(e)(3)
of the Code.

(l) “Dividend Equivalent Right” shall mean an Award that entitles the recipient
to receive a benefit in lieu of cash dividends that would have been payable on
any or all Shares subject to another Award granted to the Participant had such
Shares been outstanding.

(m) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

(n) “Fair Market Value” shall mean the following, arrived at by a good faith
determination of the Committee:

(1) if there are sales of Shares on a national securities exchange or in an
over-the-counter market on the date of grant (or on such other date as value
must be determined), then the mean between the highest and lowest quoted selling
price on such date; or

(2) if there are no such sales of Shares on the date of grant (or on such other
date as value must be determined) but there are such sales on dates within a
reasonable period both before and after such date, the weighted average of the
means between the highest and lowest selling price on the nearest date before
and the nearest date after such date on which there were such sales; or

(3) if actual sales are not available during a reasonable period beginning
before and ending after the date of grant (or on such other date as value must
be determined), then the mean between the bid and asked price on such date as
reported by the National Quotation Bureau; or

(4) if paragraphs (1) through (3) above are not applicable, or if the Committee
determines another method to be more appropriate (consistent with applicable
regulations and the Code) then such other method of determining fair market
value as shall be adopted by the Committee.

Where the Fair Market Value of Shares is determined under paragraph (2) above,
the average of the quoted closing prices on the nearest date before and the
nearest date after the last business day before the specified date shall be
weighted inversely by the respective numbers of trading days between the dates
of reported sales and such date (i.e., the valuation date), in accordance with
Treas. Reg. §20.2031-2(b)(1) or any successor thereto.

(o) “ISO” shall mean an Option which, at the time such Option is granted under
the Plan, qualifies as an incentive stock option within the meaning of section
422 of the Code, unless the Award Agreement states that the Option will not be
treated as an ISO.

(p) “More-Than-10-Percent Shareholder” shall mean any individual who at the time
of grant owns, directly or indirectly, or is deemed to own by reason of the
attribution rules of section 424(d) of the Code, Shares possessing more than
10 percent of the total combined voting power of all classes of Shares of the
Company or of a Related Corporation.

(q) “NQSO” shall mean an Option that, at the time such Option is granted to a
Participant does not meet the definition of an ISO, whether or not it is
designated as a nonqualified stock option in the Award Agreement.

(r) “Option” is an Award entitling the Participant on exercise thereof to
purchase Shares at a specified exercise price.

(s) “Participant” shall mean an employee, consultant or director of the Company
or an affiliate who has been granted an Award under the Plan.

(t) “Performance Stock” shall mean an Award that entitles the recipient to
receive Shares, cash equal to the Fair Market Value of such Shares, or a
combination thereof, as set forth in the Award Agreement without payment,
following the attainment of designated Performance Goals.

(u) “Performance Goals” shall mean goals deemed by the Committee to be important
to the success of the Company or any of its Related Corporations and established
with respect to an Award of Performance Stock. In creating these measures, the
Committee shall use one or more of the following business criteria: return on
assets, return on net assets, asset turnover, return on equity, return on
capital, market price appreciation of Shares, economic value added, total
stockholder return, net income, pre-tax income, earnings per share, operating
profit margin, net income margin, sales margin, cash flow, market share,
inventory turnover, sales growth, net revenue per shipment, net revenue growth,
capacity utilization, increase in customer base, environmental health and
safety, diversity, and/or quality. The business criteria may be expressed in
absolute terms or relative to the performance of other companies or an index.

(v) “Plan” shall mean the Halo Technology Holdings 2006 Equity Incentive Plan,
as set forth herein and as it may be amended from time to time.

(w) “Related Corporation” shall mean either a “subsidiary corporation” of the
Company (if any), as defined in section 424(f) of the Code, or the “parent
corporation” of the Company (if any), as defined in section 424(e) of the Code.

(x) “Restricted Stock” shall mean an Award that grants the recipient Shares at
no cost but subject to whatever restrictions are determined by the Committee.

(y) “Restricted Stock Unit” shall mean an Award that entitles the recipient to
one Share, or cash equal to the Fair Market Value of such Share, or a
combination thereof, as set forth in the Award Agreement subject to whatever
restrictions are determined by the Committee.

(z) “Securities Act” shall mean the Securities Act of 1933, as amended.

(aa) “Shares” shall mean shares of common stock of the Company, par value
$0.0001 per share.

(bb) “Stock Appreciation Right” shall mean an Award entitling the recipient upon
exercise or vesting an amount, in Shares or cash, determined by reference to
appreciation in Share value.

3. Administration

(a) The Plan shall be administered by the Committee. Each member of the
Committee, while serving as such, shall be deemed to be acting in his or her
capacity as a director of the Company. Acts approved by a majority of the
members of the Committee at which a quorum is present, or acts without a meeting
reduced to or approved in writing by a majority of the members of the Committee,
shall be the valid acts of the Committee. Any authority of the Committee (except
for the authority described in subsection (b)(1)-(4) and (7) below which may
only be exercised by the Committee) may be delegated to a Plan administrator.

(b) The Committee shall have the authority:

(1) to select the employees, consultants and directors of the Company or an
affiliate to be granted Awards under the Plan and to grant such Awards at such
time or times as it may choose;

(2) to determine the type and size of each Award, including the number of Shares
subject to the Award;

(3) to determine the terms and conditions of each Award;

(4) to amend an existing Award in whole or in part (including the extension of
the exercise period for any NQSO), except that the Committee may not (i) lower
the exercise price of any Option, or (ii) without the consent of the Participant
holding the Award, take any action under this clause if such action would
adversely affect the rights of such Participant;

(5) to adopt, amend and rescind rules and regulations for the administration of
the Plan;

(6) to interpret the Plan and decide any questions and settle any controversies
that may arise in connection with it; and

(7) to adopt such modifications, amendments, procedures, sub-plans and the like
which may be inconsistent with the provisions of the Plan, as may be necessary
to comply with the laws and regulations of other countries in which the Company
and its Related Corporations operate in order to assure the viability of Awards
granted under the Plan to individuals in such other countries.

Such determinations and actions of the Committee, and all other determinations
and actions of the Committee made or taken under authority granted by any
provision of the Plan, shall be conclusive and shall bind all parties. Nothing
in this subsection (b) shall be construed as limiting the power of the Board or
the Committee to make the adjustments described in Sections 8.3 and 8.4.

4. Effective Date and Term of Plan

(a) Effective Date. The Plan, having been adopted by the Board on September 13,
2005, shall become effective on that date, but subject to the approval of the
stockholders of the Company pursuant to Section 9(b). Awards may be granted
under the Plan before such stockholder approval (but after the Board’s adoption
of the Plan), subject to such stockholder approval.

(b) Term of Plan for ISOs. No ISO may be granted under the Plan after
September 13, 2015, but ISOs previously granted may extend beyond that date.
Awards other than ISOs may be granted after that date.

5. Shares Subject to the Plan

(a) Limits. The aggregate number of Shares that may be delivered under the Plan
is 8,400,000. The aggregate number of Shares that may be delivered under the
Plan with respect to ISOs is 8,400,000. Further, no employee shall receive
Options (in the aggregate) or Stock Appreciation Rights for more than 4,000,000
Shares each during any calendar year; or more than 4,000,000 Dividend Equivalent
Rights during any calendar year, under the Plan. Finally, the maximum number of
Shares that may be issued to any Participant under any Award in any calendar
year is 4,000,000.

(b) Special Rules. The limits set forth in subsection (a) above shall be subject
to the adjustments described in Section 8.3. Shares delivered under the Plan may
be authorized but unissued Shares or reacquired Shares, and the Company may
purchase Shares required for this purpose, from time to time, if it deems such
purchase to be advisable. Any Shares still subject to an Option which expires or
otherwise terminates for any reason whatsoever (including, without limitation,
the surrender thereof) without having been exercised in full, any Shares still
subject to an Award that is forfeited, any Shares withheld for the payment of
taxes with respect to an Award, and the Shares subject to an Award which is
payable in Shares or cash and that is satisfied in cash rather than in Shares,
shall continue to be available for Awards under the Plan. However, if an Option
or Stock Appreciation Right is cancelled, the Shares covered by the cancelled
Option and/or Stock Appreciation Right shall be counted against the maximum
number of Shares specified in Section 5(a) above for which Options and Stock
Appreciation Rights may be granted to an employee in any calendar year.

6. Eligibility. Except as otherwise provided, employees, consultants and
directors of the Company or an affiliate shall be eligible to receive Awards
under the Plan. More than one Award may be granted to a employee, consultant or
director under the Plan.

7. Types of Awards

7.1 Options

(a) Kinds of Options. Both ISOs and NQSOs may be granted by the Committee under
the Plan. NQSOs may be granted to an employee, consultant or director of the
Company or an affiliate. ISOs may only be granted to employees of the Company or
of a Related Corporation. Once an ISO has been granted, no action by the
Committee that would cause the Option to lose its status as an ISO under the
Code will be effective without the consent of the Participant holding the
Option.

 

(b) $100,000 Limit. The aggregate Fair Market Value of the Shares with respect
to which ISOs are exercisable for the first time by an employee during any
calendar year (counting ISOs under this Plan and under any other stock option
plan of the Company or a Related Corporation) shall not exceed $100,000. If an
Option intended as an ISO is granted to an employee and the Option may not be
treated in whole or in part as an ISO pursuant to the $100,000 limit, the Option
shall be treated as an ISO to the extent it may be so treated under the limit
and as an NQSO as to the remainder. For purposes of determining whether an ISO
would cause the limit to be exceeded, ISOs shall be taken into account in the
order granted. The annual limits set forth above for ISOs shall not apply to
NQSOs.

(c) Exercise Price. The exercise price of an Option shall be determined by the
Committee, subject to the following:

(i) The exercise price of an ISO shall not be less than the greater of (A) 100
percent (110 percent in the case of an ISO granted to a More-Than-10-Percent
Shareholder) of the Fair Market Value of the Shares subject to the Option,
determined as of the time the Option is granted, or (B) the par value per Share.

(ii) The exercise price of an NQSO shall not be less than the greater of (A) 100
percent of the Fair Market Value of the Shares subject to the Option, determined
as of the time the Option is granted, or (B) the par value per Share.

(d) Term of Options. The term of each Option may not be more than 10 years (five
years, in the case of an ISO granted to a More-Than-10-Percent Shareholder),
from the date the Option was granted, or such earlier date as may be specified
in the Award Agreement.

(e) Exercise of Options. An Option shall become exercisable at such time or
times, and on such conditions, as the Committee may specify. The Committee may
at any time and from time to time accelerate the time at which all or any part
of the Option may be exercised. Any exercise of an Option must be in writing,
signed by the proper individual, and delivered or mailed to the Company,
accompanied by (i) any other documents required by the Committee and
(ii) payment in full in accordance with subsection (f) below for the number of
Shares for which the Option is exercised (except that, in the case of an
exercise arrangement approved by the Committee and described in subsection
(f)(iii) below, payment may be made as soon as practicable after the exercise).
Only full shares shall be issued under the Plan, and any fractional share that
might otherwise be issuable upon exercise of an Option granted hereunder shall
be forfeited.

(f) Payment for Shares. The Award Agreement shall set forth, from among the
following alternatives, how the exercise price is to be paid:

(i) in cash or by check (acceptable to the Committee), bank draft, or money
order payable to the order of the Company;

(ii) unless prohibited by guidance issued under Section 409A of the Code, in
Shares previously acquired by the Participant; provided, however, that if such
Shares were acquired through the exercise of an ISO and are used to pay the
Option price of an ISO, such Shares have been held by the Participant for a
period of not less than the holding period described in section 422(a)(1) of the
Code on the date of exercise, or if such Shares were acquired through the
exercise of an NQSO and are used to pay the Option price of an ISO, or if such
Shares were acquired through the exercise of an ISO or an NQSO and are used to
pay the Option price of an NQSO, such Shares have been held by the Participant
for such period of time as may be required, if applicable, to be considered
“mature” Shares for purposes of accounting treatment;

(iii) with the contemporaneous consent of the Committee, by delivering a
properly executed notice of exercise of the Option to the Company and a broker,
with irrevocable instructions to the broker promptly to deliver to the Company
the amount of sale or loan proceeds necessary to pay the exercise price of the
Option (in no event shall any part of such transaction constitute a loan from
the Company or an affiliate to the Participant); or

 

(iv) by any combination of the above-listed forms of payment.

If the Option price is paid, in whole or in part, with Shares, the portion of
the Option price so paid shall be equal to the Fair Market Value on the date of
exercise of the Option of the Shares surrendered in payment of such Option
price.

7.2 Stock Appreciation Rights

(a) Grant of Stock Appreciation Rights. The Committee may grant Stock
Appreciation Rights to any employee, consultant or director of the Company or an
affiliate. The Committee may grant Stock Appreciation Rights that are payable
upon a Participant’s exercise of his or her Award (an “Exercisable SAR”) or that
are payable upon the vesting of his or her Award (a “Vesting SAR”).

(b) Nature of Exercisable SARs. An Exercisable SAR entitles the Participant to
receive, with respect to each Share as to which the Stock Appreciation Right is
vested, the excess of the Share’s Fair Market Value on the date of exercise over
its Fair Market Value on the date the Stock Appreciation Right was granted. Such
excess shall be paid in Shares.

A Participant may exercise his or her Exercisable SAR at any time after it vests
and prior to its termination.

(c) Nature of Vesting SARs. A Vesting SAR entitles the Participant to receive,
with respect to each Share as to which the Stock Appreciation Right is vested,
the excess of the Share’s Fair Market Value on the date of vesting over its Fair
Market Value on the date the Stock Appreciation Right was granted. Such excess
shall be paid in cash as soon as practicable after, but no later than March 15
of the calendar year beginning after, the date the Stock Appreciation Rights are
no longer subject to a substantial risk of forfeiture (as defined in
Section 409A of the Code) unless the Committee has specified a later payment
date (in accordance with Section 409A of the Code) in the Award Agreement.

(d) Vesting of Stock Appreciation Rights. A Stock Appreciation Right shall vest
at such time or times, and on such conditions, as the Committee may specify in
the Award Agreement. The Committee may at any time accelerate the vesting of a
Stock Appreciation Right.

7.3 Restricted Stock

(a) General Requirements. The Committee may issue or transfer Restricted Stock
(for any or no consideration) to any employee, consultant or director of the
Company or an affiliate.

(b) Rights as a Stockholder. Unless the Committee determines otherwise, a
Participant who receives Restricted Stock shall have certain rights of a
stockholder with respect to the Restricted Stock, including voting and dividend
rights (in accordant with subsection (e), below), subject to the restrictions
described in subsection (c) below and any other conditions imposed by the
Committee at the time of grant. Unless the Committee determines otherwise,
certificates evidencing shares of Restricted Stock will remain in the possession
of the Company until such Shares are free of all restrictions under the Plan.

(c) Restrictions. Except as otherwise specifically provided by the Plan,
Restricted Stock may not be sold, assigned, transferred, pledged, or otherwise
encumbered or disposed of, and if the Participant ceases to be an employee of
any of the Company and its Related Corporations for any reason, must be
forfeited to the Company. These restrictions will lapse at such time or times,
and on such conditions, as the Committee may specify in the Award Agreement.
Upon the lapse of all restrictions, the Shares will cease to be Restricted Stock
for purposes of the Plan. The Committee may at any time accelerate the time at
which the restrictions on all or any part of the Shares will lapse.

(d) Notice of Tax Election. Any Participant making an election under section
83(b) of the Code for the immediate recognition of income attributable to an
Award of Restricted Stock must provide a copy thereof to the Company within
10 days of the filing of such election with the Internal Revenue Service.

 

(e) Dividend Rights. Dividends payable with respect to dividend rights
attributable to a Restricted Stock Award shall accumulate without interest (and
be held by the Company) and shall vest at the same time as the Shares
attributable to the Restricted Stock Award vest. Once vested, such dividends
will be paid to the Participant in cash as soon as practicable after, but not
later than March 15 of the calendar year beginning after, the date the dividends
are no longer subject to a substantial risk of forfeiture (as defined under
Section 409A of the Code) unless the Committee has specified a later payment
date (in accordance with Section 409A of the Code) in the Award Agreement.

7.4 Restricted Stock Units

(a) Grant. The Committee may grant Restricted Stock Units to any employee,
consultant or director of the Company or an affiliate.

(b) Nature of Restricted Stock Units. A Restricted Stock Unit entitles the
Participant to receive, with respect to each vested Restricted Stock Unit, one
Share of the Company, cash equal to the Fair Market Value of such Share, or a
combination thereof, as set forth in the Award Agreement.

(c) Payment of Restricted Stock Units. Payment with respect to Restricted Stock
Units shall be made, in Shares or cash, as applicable, shall be delivered as
soon as practicable after, but not later than March 15 of the calendar year
beginning after, the date the Restricted Stock Units are no longer subject to a
substantial risk of forfeiture (as defined in section 409A of the Code) unless
the Committee has specified a later payment date (in accordance with
Section 409A of the Code) in the Award Agreement.

(d) Dividend Equivalent Rights. A Participant who receives a Restricted Stock
Unit shall not have voting and dividend rights with respect to such Restricted
Stock Unit. However, a Participant will have Dividend Equivalent Rights on
Restricted Stock Units, entitling the Participant to receive the value of any
cash dividends paid on Shares represented by the Participant’s Restricted Stock
Units. Such Dividend Equivalent Rights shall accumulate (without interest) and
shall vest at the same time as the Restricted Stock Units vest to which the
Dividend Equivalent Rights relate. Once vested such Dividend Equivalent Rights
shall be paid to the Participant as soon as practicable after, but no later than
March 15 of the calendar year beginning after, the Dividend Equivalent Rights
are no longer subject to a substantial risk of forfeiture (as defined under
Section 409A of the Code) unless the Committee has specified a later payment
date (in accordance with Section 409A of the Code) in the Award Agreement.

7.5 Performance Stock; Performance Goals

(a) Grant. The Committee may grant Performance Stock to any employee, consultant
or director of the Company or an affiliate, conditioned upon the meeting of
designated Performance Goals. The Committee shall determine the number of Shares
of Performance Stock to be granted.

(b) Nature of Performance Stock. An Award of Performance Stock entitles the
recipient, to the extent the performance goals are met, to receive Shares, cash
equal to the Fair Market Value of such Shares, or a combination thereof, as set
forth in the Award Agreement.

(c) Performance Period and Performance Goals. When Performance Stock is granted,
the Committee shall establish the performance period during which performance
shall be measured, the Performance Goals, and such other conditions of the Award
as the Committee deems appropriate.

(d) Delivery of Performance Stock. At the end of each performance period, the
Committee shall determine to what extent the Performance Goals and other
conditions of the Award have been met and the number of Shares (or cash), if
any, to be delivered with respect to the Award. Provided that the Committee
determines that the performance goals and other conditions have been met, Shares
or cash, as applicable, shall be delivered as soon as practicable after, but no
later than March 15 of the calendar year beginning after, the date the
Performance Stock is no longer subject to a substantial risk of forfeiture (as
defined in section 409A of the Code), unless the Committee has specified a later
payment date (in accordance with Section 409A) in the Award Agreement.

 

7.6 Contract Stock

(a) Grant. The Committee may grant Contract Stock to any employee, consultant or
director of the Company or an affiliate, conditioned upon the Participant’s
continued provision of services to the Company and its affiliates through the
date specified in the Award Agreement. The Committee shall determine the number
of Shares of Contract Stock to be granted.

(b) Contract Date. When Contract Stock is granted, the Committee shall establish
the Contract Date on which the Contract Stock shall be delivered to the
Participant, provided the Participant is still providing services to the Company
and its affiliates on such date.

(c) Delivery of Contract Stock. If the Participant is still providing services
to the Company and its affiliates as of the Contract Date, the Committee shall
cause the Contract Stock to be delivered to the Participant in accordance with
the terms of the Award Agreement. Shares shall be delivered as soon as
practicable after, but no later than March 15 of the calendar years beginning
after, the date the Contract Stock is no longer subject to a substantial risk of
forfeiture (as defined in section 409A of the Code) (i.e., the Contract Date),
unless the Committee has specified a later payment date (in accordance with
Section 409A) in the Award Agreement.

7.7 Bonus Stock. The Committee may grant Bonus Stock to an employee, consultant
or director of the Company or an affiliate as a bonus to the individual for
service to the Company and its affiliates. The Committee shall determine the
number of Shares of Bonus Stock to be granted. Bonus Stock shall be delivered to
the Participant as soon as practicable after, but no later than March 15 of the
calendar year beginning after, the date the Bonus Stock is granted to the
participant.

7.8 Dividend Equivalent Rights. The Committee may provide for payment (in
Shares, cash or other benefit as set forth in the Award Agreement) to an
employee, consultant or director of the Company or an affiliate of Dividend
Equivalent Rights. Benefits payable with respect to Dividend Equivalent Rights
shall accumulate without interest (and shall be held by the Company) and such
Dividend Equivalent Rights shall vest in accordance with the vesting schedule in
the Award Agreement. Dividend Equivalent Rights shall be paid to the Participant
as soon as practicable after, but no later than March 15 of the calendar year
beginning after, the date the Dividend Equivalent Rights are no longer subject
to a substantial risk of forfeiture (as defined in section 409A of the Code),
unless the Committee has specified a later payment date (in accordance with
Section 409A) in the Award Agreement.

8. Events Affecting Outstanding Awards

8.1 Termination of Service (Other Than by Death or Disability). If a Participant
ceases to be an employee, consultant or director of any of the Company and its
affiliates (Related Corporations for purposes of ISOs) for any reason other than
death or Disability, the following shall apply:

(a) Options and Exercisable SARs. Except as otherwise determined by the
Committee and except in the event the Participant terminates for Cause, all
Options and Exercisable SARs held by the Participant that were not exercisable
immediately before the Participant’s termination of service shall terminate at
that time. Any Options and Exercisable SARs that were exercisable immediately
before the termination of service will continue to be exercisable for three
months (or for such longer period as the Committee may determine), and shall
thereupon terminate, unless the Award Agreement provides by its terms for
immediate termination or for termination in less than three months if
termination of service occurs in specific circumstances. In no event, however,
shall an Option or Exercisable SAR remain exercisable beyond the latest date on
which it could have been exercised without regard to this Section. For purposes
of this subsection (a), a termination of service shall not be deemed to have
resulted by reason of a sick leave or other bona fide leave of absence approved
for purposes of the Plan by the Committee. In the event the Participant
terminates service for Cause, all Options and Exercisable SARs held by the
Participant (whether or not they are exercisable) shall terminate at that time.

 

(b) Restricted Stock. Except as otherwise determined by the Committee, all
Restricted Stock held by the Participant at the time of termination of service
must be transferred to the Company (and, if the certificates representing such
Restricted Stock are held by the Company, such Restricted Stock shall be so
transferred without any further action by the Participant), in accordance with
Section 7.3.

(c) Other Awards. Except as otherwise determined by the Committee, all Vesting
SARs, Restricted Stock Units, Performance Stock, Contract Stock and Dividend
Equivalent Rights to which the Participant was not irrevocably entitled before
the termination of service shall be forfeited and the Award canceled as of the
date of such termination of service.

8.2 Death or Disability. If a Participant dies or incurs a Disability, the
following shall apply:

(a) Options and Exercisable SARs. Except as otherwise determined by the
Committee, all Options and Exercisable SARs held by the Participant immediately
before death or Disability, as the case may be, to the extent then exercisable,
may be exercised by the Participant or by the Participant’s legal representative
(in the case of Disability), or by the Participant’s executor or administrator
or by the individual(s) to whom the Option or Exercisable SARs is transferred by
will or the laws of descent and distribution, at any time within the one-year
period ending with the first anniversary of the Participant’s death or
Disability (or such shorter or longer period as the Committee may determine),
and shall thereupon terminate. In no event, however, shall an Option or
Exercisable SARs remain exercisable beyond the latest date on which it could
have been exercised without regard to this Section. Except as otherwise
determined by the Committee, all Options and Exercisable SARs held by a
Participant immediately before death or Disability that are not then exercisable
shall terminate at the date of death or Disability.

(b) Restricted Stock. Except as otherwise determined by the Committee, all
Restricted Stock held by the Participant at the date of death or Disability, as
the case may be, must be transferred to the Company (and, if the certificates
representing such Restricted Stock are held by the Company, such Restricted
Stock shall be so transferred without any further action by the Participant), in
accordance with Section 7.3.

(c) Other Awards. Except as otherwise determined by the Committee, all Vesting
SARs, Restricted Stock Units, Performance Stock, Contract Stock and Dividend
Equivalent Rights to which the Participant was not irrevocably entitled before
death or Disability, as the case may be, shall be forfeited and the Award
canceled as of the date of death or Disability.

8.3 Capital Adjustments. The maximum number of Shares that may be delivered
under the Plan (including the number of Shares that may be delivered with
respect to ISOs), and the maximum number of Shares with respect to which
Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, or
Performance Stock may be granted to any Participant under the Plan, all as
stated in Section 5, and the number of Shares issuable upon the exercise or
vesting of outstanding Awards under the Plan (as well as the exercise price per
Share under outstanding Options) shall be proportionately adjusted, as may be
deemed appropriate by the Committee, to reflect any increase or decrease in the
number of issued Shares resulting from a subdivision (share-split),
consolidation (reverse split), stock dividend, or similar change in the
capitalization of the Company.

8.4 Certain Corporate Transactions

(a) If a corporate transaction occurs (as, for example, a merger, consolidation,
sale of all or substantially all of the Company’s property or the sale of more
than 50% of the outstanding shares of the Company’s stock, separation,
reorganization, or liquidation), each outstanding Award shall be assumed by the
surviving or successor entity; provided, however, that if a corporate
transaction is proposed, the Committee may terminate all or a portion of any
outstanding Award, effective upon the closing of the corporate transaction, if
it determines that such termination is in the best interests of the Company. If
the Committee decides to terminate outstanding Options and Exercisable SARs, the
Committee shall give each Participant holding an Option or Exercisable SAR to be
terminated not less than seven days’ notice before any such termination, and any
Option or Exercisable SAR that is to be so terminated may be exercised (if and
only to the extent that it is then exercisable) up to, and including the date
immediately preceding such termination. Further, the Committee, in its
discretion, may (i) accelerate, in whole or in part, the date on which any or
all Options, Stock Appreciation Rights, or Restricted Stock Units vest,
(ii) remove the restrictions from the outstanding Restricted Stock, (iii) cause
the delivery of any Performance Stock, even if the associated Performance Goals
have not been met, (iv) cause the delivery of any Contract Stock, even if the
Contract Date has not been reached and/or (v) cause the payment of any Dividend
Equivalent Rights. The Committee also may, in its discretion, change the terms
of any outstanding Award to reflect the corporate transaction, provided that, in
the case of ISOs, such change would not constitute a “modification” under
section 424(h) of the Code unless the Participant consents to the change.

(b) With respect to an outstanding Award held by a Participant who, following
the corporate transaction, will be employed by or otherwise providing services
to an entity which is a surviving or acquiring entity in such transaction or an
affiliate of such an entity, the Committee may, in lieu of the action described
in subsection (a) above, arrange to have such surviving or acquiring entity or
affiliate grant to the Participant a replacement award which, in the judgment of
the Committee, is substantially equivalent to the Award.

9. Amendment or Termination of the Plan

(a) In General. The Board, pursuant to a written resolution, may from time to
time suspend or terminate the Plan or amend it and, except as provided in
Section 3(b)(4), 7.1(a), and 8.4(a), the Committee may amend any outstanding
Awards in any respect whatsoever; except that, without the approval of the
shareholders (given in the manner set forth in subsection (b) below)—

(1) no amendment may be made that would—

(A) change the class of employees eligible to participate in the Plan with
respect to ISOs;

(B) except as permitted under Section 8.3, increase the maximum number of Shares
with respect to which ISOs may be granted under the Plan; or

(C) extend the duration of the Plan under Section 4(b) with respect to any ISOs
granted hereunder;

(2) no amendment may be made that would constitute a modification of the
material terms of the “performance goal(s)” within the meaning of Treas. Reg.
§ 1.162-27(e)(4)(vi) or any successor thereto (to the extent compliance with
section 162(m) of the Code is desired);

(3) no amendment may be made that would require shareholder approval under an
applicable law or exchange listing rule.

Notwithstanding the foregoing, no such suspension, termination, or amendment
shall materially impair the rights of any Participant holding an outstanding
Award without the consent of such Participant, unless such suspension,
termination or amendment is necessary to comply with applicable law.

(b) Manner of Shareholder Approval. The approval of shareholders must comply
with all applicable provisions of the corporate charter and bylaws of the
Company, and applicable state law prescribing the method and degree of
shareholder approval required for the issuance of corporate stock or options. If
the applicable state law does not prescribe a method and degree of shareholder
approval in such cases, the approval of shareholders must be effected:

(1) by a method and in a degree that would be treated as adequate under
applicable state law in the case of an action requiring shareholder approval
(i.e., an action on which shareholders would be entitled to vote if the action
were taken at a duly held shareholders’ meeting);

(2) by a majority of the votes cast (including abstentions, to the extent
abstentions are counted as voting under applicable state law), in a separate
vote at a duly held shareholders’ meeting at which a quorum representing a
majority of all outstanding voting stock is, either in person or by proxy,
present and voting on the Plan.

 

10. Miscellaneous

10.1 Documentation of Awards. Awards shall be evidenced by such written Award
Agreements, if any, as may be prescribed by the Committee from time to time.
Such instruments may be in the form of agreements to be executed by both the
Participant and the Company, or certificates, letters, or similar instruments,
which need not be executed by the Participant but acceptance of which will
evidence agreement to the terms thereof.

10.2 Rights as a Stockholder. Except as specifically provided by the Plan or an
Award Agreement, the receipt of an Award shall not give a Participant rights as
a stockholder; instead, the Participant shall obtain such rights, subject to any
limitations imposed by the Plan or the Award Agreement, upon the actual receipt
of Shares.

10.3 Conditions on Delivery of Shares. The Company shall not deliver any Shares
pursuant to the Plan or remove restrictions from Shares previously delivered
under the Plan (i) until all conditions of the Award have been satisfied or
removed, (ii) until all applicable Federal and state laws and regulations have
been complied with, and (iii) if the outstanding Shares are at the time of such
delivery listed on any stock exchange or market, until the Shares to be
delivered have been listed or authorized to be listed on such exchange or
market. If an Award is exercised by the Participant’s legal representative, the
Company will be under no obligation to deliver Shares pursuant to such exercise
until the Company is satisfied as to the authority of such representative.

10.4 Registration and Listing of Shares. If the Company shall deem it necessary
to register under the Securities Act or any other applicable statute any Shares
purchased under this Plan, or to qualify any such Shares for an exemption from
any such statutes, the Company shall take such action at its own expense. If
Shares are listed on any national securities exchange or market at the time any
Shares are purchased hereunder, the Company shall make prompt application for
the listing on such national securities exchange or market of such Shares, at
its own expense. Purchases and grants of Shares hereunder shall be postponed as
necessary pending any such action.

10.5 Compliance with Rule 16b-3. All elections and transactions under this Plan
by individuals subject to Rule 16b-3, promulgated under section 16(b) of the
Exchange Act, or any successor to such Rule, are intended to comply with at
least one of the exemptive conditions under such Rule. The Committee shall
establish such administrative guidelines to facilitate compliance with at least
one such exemptive condition under Rule 16b-3 as the Committee may deem
necessary or appropriate.

10.6 Tax Withholding

(a) Obligation to Withhold. The Company shall withhold from any cash payment
made pursuant to an Award an amount sufficient to satisfy all Federal, state,
and local withholding tax requirements including the withholding requirements of
any jurisdiction outside the United States (the “Withholding Requirements”). In
the case of an Award pursuant to which Shares may be delivered, the Committee
may require that the Participant or other appropriate individual remit to the
Company an amount sufficient to satisfy the Withholding Requirements, or make
other arrangements satisfactory to the Committee with regard to such Withholding
Requirements, before the delivery of any Shares.

(b) Election to Withhold Shares. The Committee, in its discretion, may permit or
require the Participant to satisfy the withholding requirements, in whole or in
part, by electing to have the Company withhold Shares (or by returning
previously acquired Shares to the Company); provided, however, that the Company
may limit the number of Shares withheld to satisfy the Withholding Requirements
to the extent necessary and if by so doing adverse accounting consequences will
be avoided. Shares shall be valued, for purposes of this subsection (b), at
their Fair Market Value (determined as of the date an amount is includible in
income by the Participant (the “Determination Date”), rather than the date of
grant). If Shares acquired by the exercise of an ISO are used to satisfy the
Withholding Requirements, such Shares must have been held by the Participant for
a period of not less than the holding period described in section 422(a)(1) of
the Code as of the Determination Date. The Committee shall adopt such
withholding rules as it deems necessary to carry out the provisions of this
Section.

 

10.7 Transferability of Awards. No ISO may be transferred other than by will or
by the laws of descent and distribution. No other Award may be transferred,
except to the extent permitted in the applicable Award Agreement. During a
Participant’s lifetime an Award requiring exercise may be exercised only by the
Participant (or if the Participant becomes incapacitated, by the individual(s)
legally appointed to act on the Participant’s behalf).

10.8 Registration. If the Participant is married at the time Shares are
delivered and if the Participant so requests at such time, the certificate or
certificates for such Shares shall be registered in the name of the Participant
and the Participant’s spouse, jointly, with right of survivorship.

10.9 Acquisitions. Notwithstanding any other provision of this Plan, Awards may
be granted hereunder in substitution for awards held by employees and directors
of other entities who are about to, or have, become employees or directors of
the Company or an affiliate as a result of a merger, consolidation, acquisition
of assets or similar transaction by the Company or the affiliate. The terms of
the substitute Awards so granted may vary from the terms set forth in this Plan
to such extent as the Committee may deem appropriate to conform, in whole or in
part, to the provisions of the awards in substitution for which they are
granted; provided, however, that no substitute Award shall be granted which will
subject the Award to section 409A of the Code (if it previously was not subject
to such Code section).

10.10 Replacement of Outstanding Options. The Committee shall have the authority
to cancel, at any time and from time to time, with the consent of the affected
Participants, any or all outstanding Options under the Plan and to grant in
substitution therefore, new Options under the Plan covering the same or a
different number of Shares but having a per share purchase price not less than
the greater of par value or 100 percent of the Fair Market Value of a Share on
the new date of the grant. Prior to the effective date of the “Statement of
Financial Accounting Standards No. 123 (Revised December 2004),” such substitute
grant shall not be made within six months before or after such cancellation. The
Committee may permit the voluntary surrender of all or a portion of any Option
to be conditioned upon the granting to the Participant under the Plan of a new
Option for the same or a different number of Shares as the Option surrendered,
or may require such voluntary surrender as a condition precedent to a grant of a
new Option to such Participant. Any new Option shall be exercisable at the
price, during the period, and in accordance with any other terms and conditions
specified by the Committee at the time the new Option is granted, all determined
in accordance with the provisions of the Plan without regard to the price,
period of exercise, and any other terms or conditions of the Option surrendered.

10.11 Employment/Service Rights. Neither the adoption of the Plan nor the grant
of Awards will confer on any individual any right to continued employment by, or
the provision of service to, the Company or any of its Related Corporations or
affect in any way the right of any of the foregoing to terminate an employment
or service relationship at any time.

10.12 Indemnification of Board and Committee. Without limiting any other rights
of indemnification that they may have from the Company or any of its Related
Corporations, the members of the Board and the members of the Committee shall be
indemnified by the Company against all costs and expenses reasonably incurred by
them in connection with any claim, action, suit or proceeding to which they or
any of them may be a party by reason of any action taken or failure to act
under, or in connection with, the Plan or any Award granted thereunder, and
against all amounts paid by them in settlement thereof (provided such settlement
is approved by legal counsel selected by the Company) or paid by them in
satisfaction of a judgment in any such action, suit or proceeding, except a
judgment based upon a finding of willful misconduct or recklessness on their
part. Upon the making or institution of any such claim, action, suit or
proceeding, the Board or Committee member shall notify the Company in writing,
giving the Company an opportunity, at its own expense, to handle and defend the
same before such Board or Committee member undertakes to handle it on his or her
own behalf. The provisions of this Section shall not give members of the Board
or the Committee greater rights than they would have under the Company’s by-laws
or Nevada law.

 

10.13 Application of Funds. Any cash proceeds received by the Company from the
sale of Shares pursuant to Awards granted under the Plan shall be added to the
general funds of the Company. Any Shares received in payment for additional
Shares upon exercise of an Option shall become treasury stock.

10.14 Governing Law. The Plan shall be governed by the applicable Code
provisions to the maximum extent possible. Otherwise, the laws of the State of
Nevada (without reference to the principles of conflict of laws) shall govern
the operation of, and the rights of employees and directors under, the Plan and
Awards granted hereunder.

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IN WITNESS WHEREOF, Halo Technology Holdings has caused this Plan to be duly
executed this 27th day of October 2006.

 

      HALO TECHNOLOGY HOLDINGS

 
   
By:
  /S/ ERNEST C. MYSOGLAND
 
   
Title: 
  Executive Vice President
 
 
   

 

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