exhibit-10_05.htm


     

     

    
      

      

    

    

 

    PLATINA
ENERGY GROUP, INC.

    a
Delaware corporation

    


    INCENTIVE
STOCK OPTION AGREEMENT

    UNDER
THE 2005 STOCK OPTION PLAN

    


    Between:

    


    PLATINA ENERGY GROUP, INC., a Delaware
corporation (the “Company”), and Blair J. Merriam (the “Employee”), dated
effective March 28, 2007.

    


    The Company hereby grants to the
Employee an option (the “Option”) to purchase
2,000,000 shares of the Company’s $.001 par value common stock (“Stock”) under the
Platina Energy Group, Inc. 2005 Stock Option Plan (the “Plan”) upon the
following terms and conditions:

    


    1.             Purchase
Price.  The purchase price of the Stock shall be $0.09 per
share, which is not less than the fair market value of the Stock on the date of
this Agreement.

    


    2.             Incentive Stock
Option.  The Option shall be an Incentive Stock Option, as
defined in the Plan.

    


    3.             Period of
Exercise.  The Option will expire five (5) years from the date
of this Agreement.  The Option may be exercised only while the
Employee is actively employed by the Company and as provided in Section 6,
dealing with termination of employment.

    


    This Option may not be exercised for
less than fifty shares at any time unless the number of shares purchased is the
total number purchasable at the time under the Option.

    


    Where the Employee holds (whether under
this Option alone or under this Option in conjunction with other incentive stock
options) incentive stock options upon shares of the Company’s common stock
having an aggregate fair market value (determined at the time of grant of each
option) exceeding $100,000, the $100,000 Limitation set forth in Section 4 below
may impose additional limitations upon the exercisability of this Option and any
other incentive stock options granted to the Employee.

    


    4.             $100,000
Limitation.  Notwithstanding anything to the contrary contained
herein, the total fair market value (determined as of the date of grant of an
option) of shares of stock with respect to which this Option (and any other
incentive stock options granted by the Company) shall become exercisable for the
first time during any calendar year shall not exceed $100,000 for the options to
be “incentive stock options.”   (Hereinafter this limitation is
sometimes referred to as the “$100,000 Limitation.”)  If in any
calendar year shares of stock having a fair market value of more than $100,000
first would become exercisable, but for the limitations of this section, this
Option shall be exercisable in such calendar year only for shares having a fair
market value not exceeding $100,000.  (Hereinafter, shares with
respect to which this Option is not exercisable in a calendar year due to the
$100,000 Limitation are referred to as “Excess Shares.”)

    


    This Option shall become exercisable
with respect to Excess Shares from a calendar year in the next succeeding
calendar year (subject to any other restrictions on exercise which may be
contained herein), provided that the $100,000 limitation shall also be applied
to such succeeding calendar year.  Subject to the term of this Option,
such carryovers of Excess Shares shall be made to succeeding calendar years,
including carryovers of any Excess Shares from previous calendar years, without
limitation.

    


    If as of the date of this Agreement the
Employee already holds incentive stock options granted by the Company
(hereinafter any such incentive stock options are referred to as “Prior
Options”), and the fair market value (determined as the date of grant of each
option) of the shares subject to this Option and the Prior Options held by the
Employee is such that the $100,000 Limitation must be imposed, the $100,000
Limitation shall be applied as follows unless a special provision is made on
Exhibit A attached hereto.  If no special provision is made on Exhibit
A, the $100,000 Limitation shall be applied by giving priority to options which
first become exercisable during a calendar year under the Prior
Options.  Thus, in applying the $100,000 Limitation under this Option,
the fair market value (determined as of the date of grant) of the shares of
stock with respect to which options first become exercisable under the Prior
Options during the calendar year shall first be determined.  Only the
balance remaining for the calendar year of the $100,000 Limitation, if any, may
be exercisable under this Option for the calendar year, with any excess to be
carried over as provided in the preceding paragraph, but with such carryover
also to be subject to the provisions of this paragraph.

    


    Employee acknowledges that it is
possible that he or she may be granted incentive stock options by the Company
after the date of this Agreement.  (Hereinafter such options are
referred to as “Subsequent Options.”)  If the exercise price of a
Subsequent Option is less than the exercise price of this Option, and if
permitted under the regulations and decisions applicable to the $100,000
Limitation, Employee agrees that the Company may reduce the number of shares of
stock for which this Option is exercisable in specified calendar years, so that
all or part of the $100,000 limitation for said calendar years may be applied to
such Subsequent Option, permitting earlier exercise of such Subsequent Option
than would otherwise be possible.  Where such reductions are made,
Employee agrees to enter into any appropriate documentation to implement such
reductions.

    


    Employee further acknowledges that, as
provided in the Plan, in certain circumstances connected with a dissolution or
liquidation of the Company, or a merger, consolidation or other form of
reorganization in which the Company is not the surviving corporation, the
imposition of the $100,000 Limitation may result in the termination of all or
part of this Option or other incentive stock options.

    


    5.             Transferability.  This
Option is not transferable except by will or the laws of descent and
distribution and may be exercised during the lifetime of the Employee only by
him or her.

    


    6.             Termination of
Employment.  In the event that employment of the Employee with
the Company is terminated, the Option may be exercised (to the extent
exercisable at the date of his termination) by the Employee within three months
after the date of termination; provided, however, that:

    


    (a)           If
the Employee’s employment is terminated because he is disabled within the
meaning of Internal Revenue Code section 422A, the Employee shall have one year
rather than three months to exercise the Option (to the extent exercisable at
the date of his termination).

    


    (b)           If
the Employee dies, the Option may be exercised (to the extent exercisable by the
Employee at the date of his death) by his legal representative or by a person
who acquired the right to exercise such option by bequest or inheritance or by
reason of the death of the Employee, but the Option must be exercised within one
year after the date of the Employee’s death.

    


    (c)           If
the Employee’s employment is terminated for cause, this Option shall terminate
immediately.

    


    (d)           In
no event (including death of the Employee) may this Option be exercised more
than ten years from the date hereof.

    


    7.             No Guarantee of
Employment.  This Agreement shall in no way restrict the right
of the Company to terminate Employee’s employment at any time.

    


    8.             Investment Representation;
Legend.  The Employee (and any other purchaser under paragraphs
6(a) or 6(b) hereof) represents and agrees that all shares of Stock purchased by
him under this Agreement will be purchased for investment purposes only and not
with a view to distribution or resale.  The Company may require that
an appropriate legend be inscribed on the face of any certificate issued under
this Agreement, indicating that transfer of the Stock is restricted, and may
place an appropriate stop transfer order with the Company’s transfer agent with
respect to the Stock.

    


    9.             Method of
Exercise.  The Option may be exercised, subject to the terms
and conditions of this Agreement, by written notice to the
Company.  The notice shall be in the form attached to this Agreement
and will be accompanied by payment (in such form as the Company may specify) of
the full purchase price of the Stock to be issued, and in the event of an
exercise under the terms of paragraphs 6(a) or 6(b) hereof, appropriate proof of
the right to exercise the Option.  The Company will issue and deliver
certificates representing the number of shares purchased under the Option,
registered in the name of the Employee (or other purchaser under paragraph 6
hereof) as soon as practicable after receipt of the notice.

    


    10.             Withholding.  In
any case where withholding is required or advisable under federal, state or
local law in connection with any exercise by Employee hereunder, the Company is
authorized to withhold appropriate amounts from amounts payable to Employee, or
may require Employee to remit to the Company an amount equal to such appropriate
amounts.

    


    11.             Incorporation of
Plan.  This Agreement is made pursuant to the provisions of the
Plan, which Plan is incorporated by reference herein.  Terms used
herein shall have the meaning employed in the Plan, unless the context clearly
requires otherwise.  In the event of a conflict between the provisions
of the Plan and the provisions of this Agreement, the provisions of the Plan
shall govern.

    


    Platina
Energy Group, Inc.

    a
Delaware corporation

    


    


    By:
/s/   Daniel W.
Thornton                                                              

           Daniel
W. Thornton, Secretary

    ACCEPTED:

     

    /s/ Blair J.
Merriam

    Blair J.
Merriam, Employee