ex10-4.htm


    Exhibit
      10.4

     

    VEMICS,
      INC.

     

    2007
      EQUITY COMPENSATION
      PLAN

     

    The
      purpose of the Vemics, Inc. 2007 Equity Compensation Plan (the “Plan”) is to
      provide (i) designated employees of Vemics, Inc., a Nevada corporation (the
      “Company”), and its parents and subsidiaries, (ii) certain consultants and
      advisors who perform services for the Company or its parents or subsidiaries,
      and (iii) non-employee members of the Board of Directors of the Company (the
      “Board”) with the opportunity to receive grants of incentive stock options,
      nonqualified stock options and stock awards.  The Company believes
      that the Plan will reward participants for past services to the Company and
      encourage participants to contribute to the growth of the Company, thereby
      benefitting the Company’s shareholders, and will align the economic interests of
      the participants with those of the shareholders.

     

    1. Administration

     

    (a) Committee.  The
      Plan shall be administered and interpreted by the Board or by a committee
      consisting of members of the Board, which shall be appointed by the
      Board.  After an initial public offering of the Company’s stock as
      described in Section 18(b) (a “Public Offering”), the Plan shall be administered
      by a committee of Board members, which may consist of “outside directors” as
      defined under section 162(m) of the Internal Revenue Code of 1986, as amended
      (the “Code”), and related Treasury regulations, and “non-employee directors” as
      defined under Rule 16b-3 under the Securities Exchange Act of 1934, as amended
      (the “Exchange Act”).  However, the Board may ratify or approve any
      grants as it deems appropriate, and the Board shall approve and administer
      all
      grants made to non-employee directors.  The committee may delegate
      authority to one or more subcommittees as it deems appropriate.  To
      the extent that a committee or subcommittee administers the Plan, references
      in
      the Plan to the “Board” shall be deemed to refer to the committee or
      subcommittee.

     

    (b) Board
      Authority.  The Board shall have the sole authority to (i)
      determine the individuals to whom grants shall be made under the Plan, (ii)
      determine the type, size and terms of the grants to be made to each such
      individual, (iii) determine the time when the grants will be made and the
      duration of any applicable exercise or restriction period, including the
      criteria for exercisability and the acceleration of exercisability, (iv) amend
      the terms of any previously issued grant, and (v) deal with any other matters
      arising under the Plan.

     

    (c) Board
      Determinations.  The Board shall have full power and authority
      to administer and interpret the Plan, to make factual determinations and to
      adopt or amend such rules, regulations, agreements and instruments for
      implementing the Plan and for the conduct of its business as it deems necessary
      or advisable, in its sole discretion.  The Board’s interpretations of
      the Plan and all determinations made by the Board pursuant to the powers vested
      in it hereunder shall be conclusive and binding on all persons having any
      interest in the Plan or in any awards granted hereunder.  All powers
      of the Board shall be executed in its sole discretion, in the best interest
      of
      the Company, not as a fiduciary, and in keeping with the objectives of the
      Plan
      and need not be uniform as to similarly situated individuals.

     

    2. Grants

     

    (a) Awards
      under the Plan may consist of grants of incentive stock options as described
      in
      Section 5 (“Incentive Stock Options”), nonqualified stock options as described
      in Section 5 (“Nonqualified Stock Options”) (Incentive Stock Options and
      Nonqualified Stock Options are collectively referred to as “Options”) and stock
      awards as described in Section 6 (“Stock Awards”) (hereinafter collectively
      referred to as “Grants”).  All Grants shall be subject to the terms
      and conditions set forth herein and to such other terms and conditions
      consistent with this Plan as the Board deems appropriate and as are specified
      in
      writing by the Board to the individual in a grant instrument or an amendment
      to
      the grant instrument (the “Grant Instrument”).  All Grants shall be
      made conditional upon the Grantee’s acknowledgement, in writing or by acceptance
      of the Grant, that all decisions and determination of the Board shall be final
      and binding on the Grantee, his or her beneficiaries and any other person having
      or claiming an interest under such Grant.  The Board shall approve the
      form and provisions of each Grant Instrument.  Grants under a
      particular Section of the Plan need not be uniform as among the
      grantees.

     

    3. Shares
      Subject to the
      Plan

     

    (a) Shares
      Authorized.  Subject to adjustment as described below, the
      aggregate number of shares of common stock of the Company (“Company Stock”) that
      may be issued under the Plan is _________ shares.  The shares may be
      authorized but unissued shares of Company Stock or reacquired shares of Company
      Stock, including shares purchased by the Company on the open market for purposes
      of the Plan.  If and to the extent Options granted under the Plan
      terminate, expire, or are canceled, forfeited, exchanged or surrendered without
      having been exercised or if any Stock Awards (including restricted Stock Awards
      received upon the exercise of Options) are forfeited, the shares subject to
      such
      Grants shall again be available for purposes of the Plan.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b) Adjustments.  If
      there is any change in the number or kind of shares of Company Stock outstanding
      (i) by reason of a stock dividend, spinoff, recapitalization, stock split,
      or
      combination or exchange of shares, (ii) by reason of a merger, reorganization
      or
      consolidation, (iii) by reason of a reclassification or change in par value,
      or
      (iv) by reason of any other extraordinary or unusual event affecting the
      outstanding Company Stock as a class without the Company’s receipt of
      consideration, or if the value of outstanding shares of Company Stock is
      substantially reduced as a result of a spinoff or the Company’s payment of an
      extraordinary dividend or distribution, the maximum number of shares of Company
      Stock available for Grants, the maximum number of shares of Company Stock that
      any individual participating in the Plan may be granted in any year, the number
      of shares covered by outstanding Grants, the kind of shares issued under the
      Plan, and the price per share of such Grants may be appropriately adjusted
      by
      the Board to reflect any increase or decrease in the number of, or change in
      the
      kind or value of, issued shares of Company Stock to preclude, to the extent
      practicable, the enlargement or dilution of rights and benefits under such
      Grants; provided, however, that any fractional shares resulting from such
      adjustment shall be eliminated.  The Board shall be required to make
      the forgoing adjustments in the event of a stock split, reverse stock split,
      stock dividend, recapitalization, combination or reclassification of the
      Company’s Stock.  Any adjustments determined by the Board shall be
      final, binding and conclusive.

     

    4. Eligibility
      for
      Participation

     

    (a) Eligible
      Persons.  All employees of the Company and its parents or
      subsidiaries (“Employees”), including Employees who are officers or members of
      the Board, and members of the Board who are not Employees (“Non-Employee
      Directors”) shall be eligible to participate in the Plan.  Consultants
      and advisors who perform services for the Company or any of its parents or
      subsidiaries (“Key Advisors”) shall be eligible to participate in the Plan if
      the Key Advisors render bona fide services to the Company or its parents or
      subsidiaries, the services are not in connection with the offer and sale of
      securities in a capital-raising transaction, and the Key Advisors do not
      directly or indirectly promote or maintain a market for the Company’s
      securities.

     

    (b) Selection
      of
      Grantees.  The Board shall select the Employees, Non-Employee
      Directors, and Key Advisors to receive Grants and shall determine the number
      of
      shares of Company Stock subject to a particular Grant in such manner as the
      Board determines.  Employees, Key Advisors, and Non-Employee Directors
      who receive Grants under this Plan shall hereinafter be referred to as
“Grantees”.

     

    5. Granting
      of
      Options

     

    (a) Number
      of
      Shares.  The Board shall determine the number of shares of
      Company Stock that will be subject to each Grant of Options to a
      Grantee.

     

    (b) Type
      of Option and
      Price.

     

    (i) The
      Board
      may grant Incentive Stock Options that are intended to qualify as “incentive
      stock options” within the meaning of section 422 of the Code or Nonqualified
      Stock Options that are not intended so to qualify or any combination of
      Incentive Stock Options and Nonqualified Stock Options, all in accordance with
      the terms and conditions set forth herein.  Incentive Stock Options
      may be granted only to employees of the Company or its parents or subsidiaries,
      as defined in Section 424 of the Code.  Nonqualified Stock Options may
      be granted to Employees, Non-Employee Directors, and Key Advisors.

     

    (ii) The
      purchase price (the “Exercise Price”) of Company Stock subject to an Option
      shall be determined by the Board and may be equal to, greater than, or less
      than
      the Fair Market Value (as defined below) of a share of Company Stock on the
      date
      the Option is granted; provided, however, that

     

    (A) The
      Exercise Price of an Incentive Stock Option shall be equal to, or greater than,
      the Fair Market Value of a share of Company Stock on the date of
      grant;

     

    (B) An
      Incentive Stock Option may not be granted to an Employee who, at the time of
      grant, owns stock possessing more than ten percent of the total combined voting
      power of all classes of stock of the Company or any parent or subsidiary of
      the
      Company, unless the Exercise Price per share is not less than 110% of the Fair
      Market Value of Company Stock on the date of grant;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (C) Unless
      otherwise specifically approved by the Board, the Exercise Price of a
      Nonqualified Stock Option shall not be less than the Fair Market Value of a
      share of Company Stock; and

     

    (D)  If
      the Board determines to set the Exercise Price of any Nonqualified Stock Option
      at less than the Fair Market Value of a share of Company Stock, the Board shall
      also impose terms and conditions on the exercise and holding of such Option
      as
      it determines to be appropriate to prevent the grantee of such Option from
      being
      subject to income tax under Section 409A(a)(1)(B) of the Code.

     

    (iii) If
      the
      Company Stock is publicly traded, then the Fair Market Value per share shall
      be
      determined as follows: (A) if the principal trading market for the Company
      Stock
      is a national securities exchange, the Nasdaq National Market, or the
      Over-the-Counter Bulleting Board, the last reported sale price thereof on the
      relevant date or (if there were no trades on that date) the latest preceding
      date upon which a sale was reported, or (B) if the Company Stock is not
      principally traded on such exchange or market, the mean between the last
      reported “bid” and “asked” prices of Company Stock on the relevant date, as
      reported on Nasdaq or, if not so reported, as reported by the Pink Sheets,
      Inc.
      or as reported in a customary financial reporting service, as applicable and
      only if the Board determines that such prices should be utilized for this
      purpose in its sole discretion.  If the Company Stock is not publicly
      traded or, if publicly traded, is not subject to reported transactions or “bid”
or “asked” quotations as set forth above, the Fair Market Value per share shall
      be as determined by the Board.

     

    (c) Option
      Term.  The Board shall determine the term of each
      Option.  The term of any Option shall not exceed ten years from the
      date of grant.  However, an Incentive Stock Option that is granted to
      an Employee who, at the time of grant, owns stock possessing more than ten
      percent of the total combined voting power of all classes of stock of the
      Company, or any parent or subsidiary of the Company, may not have a term that
      exceeds five years from the date of grant.

     

    (d) Exercisability
      of
      Options.

     

    (i) Options
      shall become exercisable in accordance with such terms and conditions,
      consistent with the Plan, as may be determined by the Board and specified in
      the
      Grant Instrument.  The Board may accelerate the exercisability of any
      or all outstanding Options at any time for any reason.

     

    (ii) The
      Board
      may provide in a Grant Instrument that the Grantee may elect to exercise part
      or
      all of an Option before it otherwise has become exercisable.  Any
      shares so purchased shall be restricted shares and shall be subject to a
      repurchase right in favor of the Company during a specified restriction period,
      with the repurchase price equal to the lesser of (i) the Exercise Price or
      (ii)
      the Fair Market Value of such shares at the time of repurchase, or such other
      restrictions as the Board deems appropriate.

     

    (e) Termination
      of Employment,
      Disability or Death.  Except as provided below or as otherwise
      specifically approved by the Board, an Option may only be exercised while the
      Grantee is employed by, or providing service to, the Employer (as defined below)
      as an Employee, Key Advisor or member of the Board.

     

    (i) In
      the
      event that a Grantee ceases to be employed by, or provide service to, the
      Employer for any reason other than Disability, death, or termination for Cause
      (as defined below), any Option which is otherwise exercisable by the Grantee
      shall terminate unless exercised within 90 days after the date on which the
      Grantee ceases to be employed by, or provide service to, the Employer (or within
      such other period of time, which period shall be at least 30 days, as may be
      specified by the Board), but in any event no later than the date of expiration
      of the Option term.  Except as otherwise provided by the Board, any of
      the Grantee’s Options that are not otherwise exercisable as of the date on which
      the Grantee ceases to be employed by, or provide service to, the Employer shall
      terminate as of such date.

     

    (ii) In
      the
      event the Grantee ceases to be employed by, or provide service to, the Employer
      on account of a termination for Cause by the Employer, any Option held by the
      Grantee shall terminate as of the date the Grantee ceases to be employed by,
      or
      provide service to, the Employer.  In addition, notwithstanding any
      other provisions of this Section 5, if the Board determines that the Grantee
      has
      engaged in conduct that constitutes Cause at any time while the Grantee is
      employed by, or providing service to, the Employer or after the Grantee’s
      termination of employment or service, any Option held by the Grantee shall
      immediately terminate, and the Grantee shall automatically forfeit all shares
      underlying any exercised portion of an Option for which the Company has not
      yet
      delivered the share certificates, upon refund by the Company of the Exercise
      Price paid by the Grantee for such shares.  Upon any exercise of an
      Option, the Company may withhold delivery of share certificates pending
      resolution of an inquiry that could lead to a finding resulting in a
      forfeiture.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (iii) In
      the
      event the Grantee ceases to be employed by, or provide service to, the Employer
      because the Grantee is Disabled, any Option which is otherwise exercisable
      by
      the Grantee shall terminate unless exercised within one year after the date
      on
      which the Grantee ceases to be employed by, or provide service to, the Employer
      (or within such other period of time, which period shall be at least six months
      as may be specified by the Board), but in any event no later than the date
      of
      expiration of the Option term.  Except as otherwise provided by the
      Board, any of the Grantee’s Options which are not otherwise exercisable as of
      the date on which the Grantee ceases to be employed by, or provide service
      to,
      the Employer shall terminate as of such date.

     

    (iv) If
      the
      Grantee dies while employed by, or providing service to, the Employer or within
      90 days after the date on which the Grantee ceases to be employed or provide
      service on account of a termination specified in Section 5(f)(i) above (or
      within such other period of time as may be specified by the Board), any Option
      that is otherwise exercisable by the Grantee shall terminate unless exercised
      within one year after the date on which the Grantee ceases to be employed by,
      or
      provide service to, the Employer (or within such other period of time, which
      period shall be at least 6 months, as may be specified by the Board), but in
      any
      event no later than the date of expiration of the Option term.  Except
      as otherwise provided by the Board, any of the Grantee’s Options that are not
      otherwise exercisable as of the date on which the Grantee ceases to be employed
      by, or provide service to, the Employer shall terminate as of such
      date.

     

    (v) For
      purposes of the Plan:

     

    (A) The
      term
“Employer” shall mean the Company and its parent and subsidiary corporations or
      other entities, as determined by the Board.

     

    (B) “Employed
      by, or provide service to, the Employer” shall mean employment or service as an
      Employee, Key Advisor or member of the Board (so that, for purposes of
      exercising Options and satisfying conditions with respect to Stock Awards,
      a
      Grantee shall not be considered to have terminated employment or service until
      the Grantee ceases to be an Employee, Key Advisor and member of the Board),
      unless the Board determines otherwise.

     

    (C) “Disability”
      shall mean a Grantee’s becoming disabled within the meaning of section 22(e)(3)
      of the Code, within the meaning of the Employer’s long-term disability plan
      applicable to the Grantee, or as otherwise determined by the Board.

     

    (D) “Cause”
      shall mean, except to the extent specified otherwise by the Board, a finding
      by
      the Board that the Grantee (I) has breached his or her employment or service
      contract with the Employer, (II) has engaged in disloyalty to the Company,
      including, without limitation, fraud, embezzlement, theft, commission of a
      felony or proven dishonesty, (III) has disclosed trade secrets or confidential
      information of the Employer to persons not entitled to receive such information,
      (IV) has breached any written noncompetition or nonsolicitation agreement
      between the Grantee and the Employer or (V) has engaged in such other behavior
      detrimental to the interests of the Employer as the Board
      determines.

     

    (f) Exercise
      of
      Options.  A Grantee may exercise an Option that has become
      exercisable, in whole or in part, by delivering a notice of exercise to the
      Company.  The Grantee shall pay the Exercise Price for an Option as
      specified by the Board (i) in cash, (ii) with the approval of the Board, by
      delivering shares of Company Stock owned by the Grantee (including Company
      Stock
      acquired in connection with the exercise of an Option, subject to such
      restrictions as the Board deems appropriate) and having a Fair Market Value
      on
      the date of exercise equal to the Exercise Price or by attestation (on a form
      prescribed by the Board) to ownership of shares of Company Stock having a Fair
      Market Value on the date of exercise equal to the Exercise Price, (iii) after
      a
      Public Offering, payment through a broker in accordance with procedures
      permitted by Regulation T of the Federal Reserve Board, or (iv) by such other
      method as the Board may approve.  The Board may authorize loans by the
      Company to Grantees in connection with the exercise of an Option, upon such
      terms and conditions as the Board, in its sole discretion, deems
      appropriate.  Shares of Company Stock used to exercise an Option shall
      have been held by the Grantee for the requisite period of time to avoid adverse
      accounting consequences to the Company with respect to the
      Option.  The Grantee shall pay the Exercise Price and the amount of
      any withholding tax due (pursuant to Section 7) as specified by the
      Board.

     

    (g) Limits
      on Incentive Stock
      Options.  Each Incentive Stock Option shall provide that, if
      the aggregate Fair Market Value of the stock on the date of the grant with
      respect to which Incentive Stock Options are exercisable for the first time
      by a
      Grantee during any calendar year, under the Plan or any other stock option
      plan
      of the Company or a parent or subsidiary, exceeds $100,000, then the Option,
      as
      to the excess, shall be treated as a Nonqualified Stock Option.  An
      Incentive Stock Option shall not be granted to any person who is not an employee
      of the Company or a parent or subsidiary (within the meaning of section 424(f)
      of the Code) of the Company.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    6. Stock
      Awards

     

    The
      Board
      may issue or transfer shares of Company Stock to an Employee, Non-Employee
      Director, and Key Advisor under a Stock Award, upon such terms as the Board
      deems appropriate.  The following provisions are applicable to Stock
      Awards:

     

    (a) General
      Requirements.  Shares of Company Stock issued or transferred
      pursuant to Restricted Stock Awards may be issued or transferred subject to
      restrictions or no restrictions, as determined by the Board.  The
      value of the consideration (cash, services or other consideration) for a
      Restricted Stock Award may be equal to, greater than, or less than the Fair
      Market Value (as defined below) of a share of Company Stock on the date the
      Option is granted, as determined by the Board at the time that the issuance
      of
      the Company Stock is authorized. The Board may establish conditions under which
      restrictions on Restricted Stock Awards shall lapse over a period of time or
      according to such other criteria as the Board deems appropriate.  The
      period of time during which the Restricted Stock Award will remain subject
      to
      restrictions will be designated in the Grant Instrument as the “Restriction
      Period.”

     

    (b) Number
      of
      Shares.  The Board shall determine the number of shares of
      Company Stock to be issued or transferred pursuant to a Stock Award and the
      restrictions applicable to such shares.

     

    (c) Requirement
      of Employment or
      Service.  If the Grantee ceases to be employed by, or provide
      service to, the Employer during a period designated in the Grant Instrument
      as
      the Restriction Period, or if other specified conditions are not met, the Stock
      Award shall terminate as to all shares covered by the award as to which the
      restrictions have not lapsed, and those shares of Company Stock must be
      immediately returned to the Company.  The Board may, however, provide
      for complete or partial exceptions to this requirement as it deems
      appropriate.  With respect to Stock Awards granted to persons other
      than officers, Board members or Key Advisors, the restrictions shall lapse
      over
      a period of not more than five years and a rate of not less than 20% per
      year.

     

    (d) Restrictions
      on Transfer and
      Legend on Stock Certificate.  During the Restriction Period, a
      Grantee may not sell, assign, transfer, pledge or otherwise dispose of the
      shares of the Stock Award except as permitted under Section
      8(a).  Each certificate for Stock Awards shall contain a legend giving
      appropriate notice of the restrictions in the Grant.  The Grantee
      shall be entitled to have the legend removed from the stock certificate covering
      the shares subject to restrictions when all restrictions on such shares have
      lapsed.  The Board may determine that the Company will not issue
      certificates for Stock Awards until all restrictions on such shares have lapsed,
      or that the Company will retain possession of certificates for Stock Awards
      until all restrictions on such shares have lapsed.

     

    (e) Right
      to Vote and to Receive
      Dividends.  During the Restriction Period,  the
      Grantee shall have the right to vote shares subject to Stock Awards and to
      receive any dividends or other distributions paid on such shares, except as
      otherwise determined by the Board.

     

    (f) Lapse
      of
      Restrictions.  All restrictions imposed on Stock Awards shall
      lapse upon the expiration of the applicable Restriction Period and the
      satisfaction of all conditions imposed by the Board.  The Board may
      determine, as to any or all Stock Awards, that the restrictions shall lapse
      without regard to any Restriction Period.

     

    (g) Stock
      Units.  The Board may grant Stock Awards in the form of phantom
      stock units, upon such terms and conditions as the Committee deems
      appropriate.  Each stock unit shall represent the right of the Grantee
      to receive an amount based on the value of a share of Company Stock, if
      specified conditions are met, at the time specified in the Grant
      Instrument.  All stock units shall be credited to bookkeeping accounts
      established on the Company’s records for purposes of the
      Plan.  Payments with respect to stock units shall be made in the form
      of Company Stock, cash or a combination of the two, as determined by the
      Board.

     

    7. Withholding
      of
      Taxes

     

    (a) Required
      Withholding.  All Grants under the Plan shall be subject to
      applicable federal (including FICA), state and local tax withholding
      requirements.  The Employer may require that the Grantee or other
      person receiving or exercising Grants pay to the Employer the amount of any
      federal, state or local taxes that the Employer is required to withhold with
      respect to such Grants, or the Employer may deduct from other wages paid by
      the
      Employer the amount of any withholding taxes due with respect to such
      Grants.

     

    (b) Election
      to Withhold
      Shares.  If the Board so permits, a Grantee may elect to
      satisfy the Employer’s tax withholding obligation with respect to a Grant by
      having shares withheld up to an amount that does not exceed the Grantee’s
      minimum applicable withholding tax rate for federal (including FICA), state
      and
      local tax liabilities.  The election must be in a form and manner
      prescribed by the Board and may be subject to the prior approval of the
      Board.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    8. Transferability
      of
      Grants

     

    (a) Nontransferability
      of
      Grants.  Except as provided below, only the Grantee may
      exercise rights under a Grant during the Grantee’s lifetime.  A
      Grantee may not transfer those rights except (i) by will or by the laws of
      descent and distribution or (ii) with respect to Grants other than Incentive
      Stock Options, if permitted in any specific case by the Board, pursuant to
      a
      domestic relations order or otherwise as permitted by the Board.  When
      a Grantee dies, the personal representative or other person entitled to succeed
      to the rights of the Grantee may exercise such rights.  Any such
      successor must furnish proof satisfactory to the Company of his or her right
      to
      receive the Grant under the Grantee’s will or under the applicable laws of
      descent and distribution.

     

    (b) Transfer
      of Nonqualified
      Stock Options. Notwithstanding the foregoing, the Board may provide, in a
      Grant Instrument, that a Grantee may transfer Nonqualified Stock Options to
      family members, or one or more trusts or other entities for the benefit of
      or
      owned by  family members, consistent with applicable securities laws,
      according to such terms as the Board may determine; provided that the Grantee
      receives no consideration for the transfer of an Option and the transferred
      Option shall continue to be subject to the same terms and conditions as were
      applicable to the Option immediately before the transfer.

     

    9. Right
      of First Refusal;
      Repurchase Right

     

    (a) Offer.  Prior
      to a Public Offering, if at any time an individual desires to sell, encumber,
      or
      otherwise dispose of shares of Company Stock that were distributed to him or
      her
      under this Plan and that are transferable, the individual may do so only
      pursuant to a bona fide written offer, and the individual shall first offer
      the
      shares to the Company by giving the Company written notice disclosing: (a)
      the
      name of the proposed transferee of the Company Stock; (b) the certificate number
      and number of shares of Company Stock proposed to be transferred or encumbered;
      (c) the proposed price; (d) all other terms of the proposed transfer; and (e)
      a
      written copy of the proposed offer.  Within 60 days after receipt of
      such notice, the Company shall have the option to purchase all or part of such
      Company Stock at the price and on the terms described in the written notice;
      provided that the Company may pay such price in installments over a period
      not
      to exceed four years, at the discretion of the Board.

     

    (b) Sale.  In
      the event the Company (or a shareholder, as described below) does not exercise
      the option to purchase Company Stock, as provided above, the individual shall
      have the right to sell, encumber, or otherwise dispose of the shares of Company
      Stock described in subsection (a) at the price and on the terms of the transfer
      set forth in the written notice to the Company, provided such transfer is
      effected within 15 days after the expiration of the option period.  If
      the transfer is not effected within such period, the Company must again be
      given
      an option to purchase, as provided above.

     

    (c) Assignment
      of
      Rights.  The Board, in its sole discretion, may waive the
      Company’s right of first refusal and repurchase right under this Section
      9.  If the Company’s right of first refusal or repurchase right is so
      waived, the Board may, in its sole discretion, assign such right to the
      remaining shareholders of the Company in the same proportion that each
      shareholder’s stock ownership bears to the stock ownership of all the
      shareholders of the Company, as determined by the Board.  To the
      extent that a shareholder has been given such right and does not purchase his
      or
      her allotment, the other shareholders shall have the right to purchase such
      allotment on the same basis.

     

    (d) Purchase
      by the
      Company.  Prior to a Public Offering, if a Grantee ceases to be
      employed by, or provide service to, the Employer, the Company shall have the
      right to purchase all or part of any Company Stock distributed to him or her
      under this Plan at its then current Fair Market Value (as defined in Section
      5(b)) (or at such other price as may be established in the Grant Instrument);
      provided, however, that such repurchase shall be made in accordance with
      applicable accounting rules to avoid adverse accounting treatment.

     

    (e) Public
      Offering.  On and after a Public Offering, the Company shall
      have no further right to purchase shares of Company Stock under this Section
      9.

     

    (f) Shareholder’s
      Agreement. Notwithstanding the provisions of this Section 9, if the Board
      requires that a Grantee execute a shareholder’s agreement with respect to any
      Company Stock distributed pursuant to this Plan, which contains a right of
      first
      refusal or repurchase right, the provisions of this Section 9 shall not apply
      to
      such Company Stock, unless the Board determines otherwise.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    10. Change
      of Control of the
      Company

     

    As
      used
      herein, a “Change of Control” shall be deemed to have occurred if:

     

    (a) Any
      “person” (as such term is used in sections 13(d) and 14(d) of the Exchange Act)
      (other than persons who are shareholders on the effective date of the Plan)
      becomes a “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act),
      directly or indirectly, of securities of the Company representing more than
      50%
      of the voting power of the then outstanding securities of the Company; provided
      that a Change of Control shall not be deemed to occur as a result of a change
      of
      ownership resulting from the death of a shareholder, and a Change of Control
      shall not be deemed to occur as a result of a transaction in which the Company
      becomes a subsidiary of another corporation and in which the shareholders of
      the
      Company, immediately prior to the transaction, will beneficially own,
      immediately after the transaction, shares entitling such shareholders to more
      than 50% of all votes to which all shareholders of the parent corporation would
      be entitled in the election of directors (without consideration of the rights
      of
      any class of stock to elect directors by a separate class vote); or

     

    (b) The
      consummation of (i) a merger or consolidation of the Company with another
      corporation where the shareholders of the Company, immediately prior to the
      merger or consolidation, will not beneficially own, immediately after the merger
      or consolidation, shares entitling such shareholders to more than 50% of all
      votes to which all shareholders of the surviving corporation would be entitled
      in the election of directors (without consideration of the rights of any class
      of stock to elect directors by a separate class vote),  (ii) a sale or
      other disposition of all or substantially all of the assets of the Company
      or
      (iii) a liquidation or dissolution of the Company.

     

    11. Consequences
      of a Change of
      Control

     

    (a) Assumption
      of
      Grants.  Upon a Change of Control where the Company is not the
      surviving corporation (or survives only as a subsidiary of another corporation),
      unless the Board determines otherwise, all outstanding Options that are not
      exercised shall be assumed by, or replaced with comparable options by the
      surviving corporation (or a parent or subsidiary of the surviving corporation),
      and outstanding Stock Awards shall be converted to Stock Awards of the surviving
      corporation (or a parent or subsidiary of the surviving
      corporation).

     

    (b) Other
      Alternatives.  Notwithstanding the foregoing, in the event of a
      Change of Control, the Board may take any of the following actions with respect
      to any or all outstanding Grants: the Board may (i) determine that outstanding
      Options shall accelerate and become exercisable, in whole or in part, upon
      the
      Change of Control or upon such other event as the Board determines, (ii)
      determine that the restrictions and conditions on outstanding Stock Awards
      shall
      lapse, in whole or in part, upon the Change of Control or upon such other event
      as the Board determines, (iii) require that Grantees surrender their outstanding
      Options in exchange for a payment by the Company, in cash or stock as determined
      by the Board, in an amount equal to the amount by which the then Fair Market
      Value of the shares of Company Stock subject to the Grantee’s unexercised
      Options exceeds the Exercise Price of the Options or (iv) after giving Grantees
      an opportunity to exercise their outstanding Options, terminate any or all
      unexercised Options at such time as the Board deems appropriate.  Such
      surrender or termination shall take place as of the date of the Change of
      Control or such other date as the Board may specify.  The Board shall
      have no obligation to take any of the foregoing actions, and, in the absence
      of
      any such actions, outstanding Options and Stock Awards shall continue in effect
      according to their terms (subject to any assumption pursuant to subsection
      (a)).

     

    12. Requirements
      for Issuance or
      Transfer of Shares

     

    (a) Shareholder’s
      Agreement.  The Board may require that a Grantee execute a
      shareholder’s agreement, with such terms as the Board deems appropriate, with
      respect to any Company Stock issued or distributed pursuant to this
      Plan.

     

    (b) Limitations
      on Issuance or
      Transfer of Shares.  No Company Stock shall be issued or
      transferred in connection with any Grant hereunder unless and until all legal
      requirements applicable to the issuance or transfer of such Company Stock have
      been complied with to the satisfaction of the Board.  The Board shall
      have the right to condition any Grant made to any Grantee hereunder on such
      Grantee’s undertaking in writing to comply with such restrictions on his or her
      subsequent disposition of such shares of Company Stock as the Board shall deem
      necessary or advisable, and certificates representing such shares may be
      legended to reflect any such restrictions.  Certificates representing
      shares of Company Stock issued or transferred under the Plan will be subject
      to
      such stop-transfer orders and other restrictions as may be required by
      applicable laws, regulations and interpretations, including any requirement
      that
      a legend be placed thereon.

     

    (c) Lock-Up
      Period.  If so requested by the Company or any representative
      of the underwriters (the “Managing Underwriter”) in connection with any
      underwritten offering of securities of the Company under the Securities Act
      of
      1933, as amended (the “Securities Act”), a Grantee (including any successor or
      assigns) shall not sell or otherwise transfer any shares or other securities
      of
      the Company during the 30-day period preceding and the 180-day period following
      the effective date of a registration statement of the Company filed under the
      Securities Act for such underwriting (or such shorter period as may be requested
      by the Managing Underwriter and agreed to by the Company) (the “Market Standoff
      Period”).  The Company may impose stop-transfer instructions with
      respect to securities subject to the foregoing restrictions until the end of
      such Market Standoff Period.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    13. Amendment
      and Termination of
      the Plan

     

    (a) Amendment.  The
      Board may amend or terminate the Plan at any time; provided, however, that
      the
      Board shall not amend the Plan without shareholder approval if such approval
      is
      required in order to comply with the Code or other applicable laws, or, after
      an
      Initial Public Offering, to comply with applicable stock exchange
      requirements.

     

    (b) Termination
      of
      Plan.  The Plan shall terminate on the day immediately
      preceding the tenth anniversary of its effective date, unless the Plan is
      terminated earlier by the Board or is extended by the Board with the approval
      of
      the shareholders.

     

    (c) Termination
      and Amendment of
      Outstanding Grants.  A termination or amendment of the Plan
      that occurs after a Grant is made shall not materially impair the rights of
      a
      Grantee unless the Grantee consents or unless the Board acts under Section
      19(b).  The termination of the Plan shall not impair the power and
      authority of the Board with respect to an outstanding Grant.  Whether
      or not the Plan has terminated, an outstanding Grant may be terminated or
      amended under Section 19(b) or may be amended by agreement of the Company and
      the Grantee consistent with the Plan.

     

    (d) Governing
      Document.  The Plan shall be the controlling
      document.  No other statements, representations, explanatory materials
      or examples, oral or written, may amend the Plan in any manner.  The
      Plan shall be binding upon and enforceable against the Company and its
      successors and assigns.

     

    14. Funding
      of the
      Plan

     

    This
      Plan
      shall be unfunded.  The Company shall not be required to establish any
      special or separate fund or to make any other segregation of assets to assure
      the payment of any Grants under this Plan.  In no event shall interest
      be paid or accrued on any Grant, including unpaid installments of
      Grants.

     

    15. Rights
      of
      Participants

     

    Nothing
      in this Plan shall entitle any Employee, Key Advisor, Non-Employee Director
      or
      other person to any claim or right to be granted a Grant under this
      Plan.  Neither this Plan nor any action taken hereunder shall be
      construed as giving any individual any rights to be retained by or in the employ
      of the Employer or any other employment rights.

     

    16. No
      Fractional
      Shares

     

    No
      fractional shares of Company Stock shall be issued or delivered pursuant to
      the
      Plan or any Grant.  The Board shall determine whether cash, other
      awards or other property shall be issued or paid in lieu of such fractional
      shares or whether such fractional shares or any rights thereto shall be
      forfeited or otherwise eliminated.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    17. Headings

     

    Section
      headings are for reference only.  In the event of a conflict between a
      title and the content of a Section, the content of the Section shall
      control.

     

    18. Effective
      Date of the
      Plan.

     

    (a) Effective
      Date.  The Plan shall be effective on _____________,
      2007.  The Plan is adopted subject to shareholder approval of the Plan
      within 12 months before or after the Plan is adopted.

     

    (b) Public
      Offering.  The provisions of the Plan that refer to a Public
      Offering, or that refer to, or are applicable to persons subject to, section
      16
      of the Exchange Act or section 162(m) of the Code, shall be effective, if at
      all, upon the initial registration of the Company Stock under section 12(g)
      of
      the Exchange Act, and shall remain effective thereafter for so long as such
      stock is so registered.

     

    19. Miscellaneous

     

    (a) Grants
      in Connection with
      Corporate Transactions and Otherwise.  Nothing contained in
      this Plan shall be construed to (i) limit the right of the Board to make Grants
      under this Plan in connection with the acquisition, by purchase, lease, merger,
      consolidation or otherwise, of the business or assets of any corporation, firm
      or association, including Grants to employees thereof who become Employees,
      or
      for other proper corporate purposes, or (ii) limit the right of the Company
      to
      grant stock options or make other awards outside of this
      Plan.  Without limiting the foregoing, the Board may make a Grant to
      an employee of another corporation who becomes an Employee by reason of a
      corporate merger, consolidation, acquisition of stock or property,
      reorganization or liquidation involving the Company, the Parent or any of their
      subsidiaries in substitution for a stock option or Stock Awards grant made
      by
      such corporation.  The terms and conditions of the substitute grants
      may vary from the terms and conditions required by the Plan and from those
      of
      the substituted stock incentives.  The Board shall prescribe the
      provisions of the substitute grants.

     

    (b) Compliance
      with
      Law.  The Plan, the exercise of Options and the obligations of
      the Company to issue or transfer shares of Company Stock under Grants shall
      be
      subject to all applicable laws and to approvals by any governmental or
      regulatory agency as may be required.  With respect to persons subject
      to section 16 of the Exchange Act, after a Public Offering it is the intent
      of
      the Company that the Plan and all transactions under the Plan comply with all
      applicable provisions of Rule 16b-3 or its successors under the Exchange
      Act.  In addition, it is the intent of the Company that the Plan and
      applicable Grants under the Plan comply with the applicable provisions of
      section 162(m) of the Code, after a Public Offering, and section 422 of the
      Code.  To the extent that any legal requirement of section 16 of the
      Exchange Act or section 162(m) or 422 of the Code as set forth in the Plan
      ceases to be required under section 16 of the Exchange Act or section 162(m)
      or
      422 of the Code, that Plan provision shall cease to apply.  The Board
      may revoke any Grant if it is contrary to law or modify a Grant to bring it
      into
      compliance with any valid and mandatory government regulation.  The
      Board may also adopt rules regarding the withholding of taxes on payments to
      Grantees.  The Board may, in its sole discretion, agree to limit its
      authority under this Section.

     

    (c) Employees
      Subject to
      Taxation Outside the United States.  With respect to Grantees
      who are subject to taxation in countries other than the United States, the
      Board
      may make Grants on such terms and conditions as the Board deems appropriate
      to
      comply with the laws of the applicable countries, and the Board may create
      such
      procedures, addenda and subplans and make such modifications as may be necessary
      or advisable to comply with such laws.

     

    (d) Governing
      Law.  The validity, construction, interpretation and effect of
      the Plan and Grant Instruments issued under the Plan shall be governed and
      construed by and determined in accordance with the laws of the State of Nevada,
      without giving effect to the conflict of laws provisions thereof.

     

    


     

    Approved
      on _________, 2007