**FULL
        CIRCLE INDUSTRIES, INC.**
 
 **2004** **** **STOCK** **** **OPTION** **** **PLAN**
 
 1.  Purposes
        of  this
        Plan .
        The
        purposes of this 2004 Stock Option Plan are to attract and
        retain the best available personnel, to provide additional incentive to the
        Employees of Full Circle
        Industries, Inc. (the “Company”) and any of its Subsidiaries, to promote the
        success of the Company’s
        business and to enable the Employees to share in the growth and prosperity
        of
        the Company
        by providing them with an opportunity to purchase stock in the
        Company.
 
 Options
        granted hereunder may be either Incentive Stock Options or Nonstatutory Stock
        Options, at the discretion of the Board and as reflected in the terms of
        the
        written stock option agreement.
 
 2.  Definitions .
        As used
        herein, the following definitions shall apply:
 
 (a)  “Board”
        shall mean the Board of Directors of the Company.
 
 (b)  “Code”
        shall mean the Internal Revenue Code of the 1986, as amended.
 
 (c)  “Common
        Stock” shall mean the Common Stock of the Company.
 
 (d)  “Company”
        shall mean Full Circle Industries, Inc., a corporation duly organized under
        the
        laws of the State of Nevada.
 
 (e)  “Committee”
        shall mean the Committee appointed by the Board in accordance with Section
        4 of
        this Plan, if one is appointed.
 
 (t)  “Continuous
        Employment” or “Continuous Status as an Employee” shall mean the absence of any
        interruption or termination of employment or service as an Employee, Director
        or
        Consultant by or to the Company or any Parent or Subsidiary of the Company
        which
        now exists or is hereafter organized or acquired by or acquires the Company.
        Continuous Employment shall not be considered interrupted in the case of
        sick
        leave, military leave or any other leave of absence approved by the Board
        or in
        the event of transfers between locations of the Company or between the Company,
        its Parent, any of its Subsidiaries or its successors.
 
 (g)  “Corporate
        Change’ shall mean one of the following events: (i) the merger, consolidation or
        other reorganization of the Company in which the outstanding Common Stock
        is
        converted into or exchanged for a different class of securities of the Company,
        a class of securities of any other issuer (except a Parent or Subsidiary
        of the
        Company), cash or other property (ii) the sale, lease or exchange of all
        or
        substantially all of the assets of the Company to any other corporation or
        entity (except a Parent or Subsidiary of the Company); or (iii) the adoption
        by
        shareholders of the Company of a plan of liquidation or dissolution. The
        following events are not defined as a “Corporate Change”: (i) a merger,
        consolidation or reorganization of
 the
        Company which would result in the voting stock of the Company outstanding
        immediately prior thereto continuing to represent (either by remaining
        outstanding or by being converted into voting securities of the surviving
        entity), in combination with the ownership of any trustee or other fiduciary
        holding securities under an employee benefit plan of the Company, at least
        sixty
        percent (60%) of the combined voting power of the voting stock of the Company
        or
        such surviving entity outstanding immediately after such merger, consolidation
        or reorganization of the Company, or (ii) merger, consolidation or
        reorganization of the Company effected to implement a recapitalization of
        the
        Company (or similar transaction) in which no person acquires more than
        forty-nine percent (49%) of the combined voting power of the Company’s then
        outstanding stock;
  
 
 (h)  “Employee”
        shall mean any person, including officers and directors, employed by the
        Company, its Parent, any of its Subsidiaries or its successors; or, for purposes
        of eligibility for Nonstatutory Stock Options, any person employed by the
        Company, including officers and directors, or any consultant to, or director
        of,
        the Company, or any Parent or Subsidiary of the Company, whether or not such
        consultant or director is an employee of such entities.
 
 (i)  “Exchange
        Act” shall mean the Securities Exchange Act of 1934, as amended, or any
        successor legislation.
 
 (j)  “Incentive
        Stock Option” shall mean an Option intended to quali~ as an incentive stock
        option within the meaning of Section 422 of the Code.
 
 (k)  “Non-Employee
        Director” shall mean a director who is a “Non-Employee Director,”
        as such term is defined under Rule 16b-3(b)(3)(i) promulgated pursuant to
        the Exchange
        Act and any applicable releases and opinions or the Securities and Exchange Commission.
 
 (1)  “Nonstatutory
        Stock Option” shall mean an Option which is not an Incentive Stock
        Option.
 
 (m)  “Option”
        shall mean a stock option granted pursuant to this Plan.
 
 (n)  “Option
        Agreement” shall mean a written agreement in such form or forms as the Board
        (subject to the terms and conditions of this Plan) may from time to time
        approve, evidencing an Option.
 
 (o)  “Optioned
        Stock” shall mean the Common Stock subject to an Option.
  
 
 (p)  “Optionee”
        shall mean an Employee who is granted an Option.
 
 (q)  “Parent”
        shall mean a “parent corporation,” whether now or hereafter existing, as defined
        in Sections 424(e) and (g) of the Code.
 .
 (r)  “Plan”
        shall mean this 2004 Stock Option Plan.
 
 (s)  “Registration
        Date” shall mean the effective date of the first registration statement which is
        filed by the Company and declared effective pursuant to Section 12(g) of
        the
        Exchange Act, with respect to any class of the Company’s
        securities.
 
 (t)  “Securities
        Act” shall mean the Securities Act of 1933, as amended, or any successor
        legislation.
 
 (u)  “Share’
        or “Shares” shall mean the Common Stock, as adjusted in accordance with Section
        11 of this Plan.
 
 (v)  “Stock
        Purchase Agreement” shall mean an agreement in such form or forms as the Board
        (subject to the terms and conditions of this Plan) may from time to time
        approve, which is to be executed as a condition of purchasing Optioned Stock
        upon exercise of an Option.
 
 (w)  “Subsidiary”
        or “Subsidiaries” shall mean one or more subsidiary corporations, whether now or
        hereafter existing, as defined in Sections 424(0 and (g) of the
        Code.
 
 3. Stock
        Subject to this Plan .
        Subject
        to the provisions of Section 11 of this Plan,
 •
              the
                  maximum number of Shares which may be optioned and sold under this
                  Plan is
                  Ten Million Shares. The Shares may be authorized, but unissued
                  or
                  reacquired Shares other than reacquired Shares delivered pursuant
                  to
                  Section 7(c)(iv) hereof as payment of consideration in the exercise
                  of an
                  option.
 
 If
        (a) an
        Option should expire or become unexercisable for any reason without having
        been
        exercised in fill or (b) if the Company repurchases Shares from the Optionee
        pursuant to the terms of a Stock Purchase Agreement (provided that the Optionee
        did not receive benefits of ownership, such as dividends, which would destroy
        the exemption from the provisions of Section 16(b) of the Exchange Act provided
        by Rule 16b-3 promulgated pursuant to the Exchange Act), the unpurchased Shares
        or repurchased Shares, respectively, which were subject thereto shall, unless
        this Plan shall have been terminated, return to this Plan and become available
        for other Options under this Plan.
  
  The
        Company intends that as long as it is not subject to the reporting requirements
        of Section 13 or *15(d)* of
        the
        Exchange Act, and is not an investment company registered or required to
        be
        registered under the Investment Company Act of 1940, as amended, all offers
        and
        sales of Options and Common Stock issuable upon exercise of any Option shall
        be
        exempt from registration under the provisions of Section *5* of
        the
        Securities Act, and this Plan shall be administered in such a manner so as
        to
        preserve such exemption.
 
 The
        Company intends for this Plan to constitute a written compensatory benefit
        plan
        within the meaning of Rule 701(b) of 17 CFR Section 230.701 (“Rule 701”)
        promulgated by the
 Securities
        and Exchange Commission pursuant to the Securities Act. Unless otherwise
        designated by the Committee at the time an Option is granted, all options
        granted under this Plan by the Company, and the issuance of any Shares upon
        exercise thereof, are intended to be granted in reliance on Rule
        701.
 
 4.  Administration  of  this
        Plan .
 
 (a)  Procedure .
        This
        Plan shall be administered by the Board. The Board may appoint a Committee
        consisting of two (2) or more members of the Board (or such greater number
        as is
        required to qualify for the exemption from the provisions of Section 16(b)
        of
        the Exchange Act provided by Rule lób-3 promulgated pursuant to the Exchange
        Act) to administer this Plan on behalf of the Board, subject to such terms
        and
        conditions as the Board may prescribe. Once appointed, the Committee shall
        continue to serve until otherwise directed by the Board. From time to time,
        the
        Board may increase the size of the Committee and appoint additional members
        of
        the Board thereto, remove members (with or without cause) and appoint new
        members of the Board in substitution therefor, fill vacancies, however caused,
        and remove all members of the Committee and, thereafter, directly administer
        this Plan. Members of the Board or Committee who are either eligible for
        Options
        or have been granted Options may vote on any matters affecting the
        administration of this Plan or the grant of Options pursuant to this Plan,
        except that no such member shall act upon the granting of an Option to such
        person nor shall any such member’s presence at a meeting of the Board of
        Directors establish the existence of a quorum at any meeting of the Board
        or the
        Committee during which action is taken with respect to the granting of an
        Option
        to him.
 
 (b)  Procedure
        After ReStration Date .
        Notwithstanding the provisions of Section 4(a) above, after the Registration
        Date this Plan shall be administered either by: (i) the full Board, provided
        that at all times each member of the Board is a Non-Employee Director; or
        (ii) a
        Committee which at all times consists solely of Board members who are
        Non-Employee Directors. After the Registration Date, the Board shall take
        all
        action necessary to administer this Plan in accordance with the then-effective
        provisions of Rule 1 6b-3 promulgated under the Exchange Act, provided that
        any
        amendment to this Plan required for compliance with such provisions shall
        be
        made in accordance with Section 13 of this Plan.
  
  (c)  Powers
        of  the
        Board and/or Committee .
        Subject
        to the provisions of this Plan, the Committee or the Board, as appropriate,
        shall have the authority, in its discretion: (i) to grant Incentive Stock
        Options and Nonstatutory Stock Options; (ii) to determine, upon review of
        relevant information and in accordance with Section 7 of this Plan, the fair
        market value per Share; (iii) to determine the exercise price of the Options,
        which exercise price and type of consideration shall be determined in accordance
        with Section 7 of this Plan; (iv) to determine the Employees to whom, and
        the
        time or times at which, Options shall be granted, and the number of Shares
        to be
        subject to each Option; (v) to prescribe, amend and rescind rules and
        regulations relating to this Plan; (vi) to determine the terms and provisions
        of
        each Option Agreement and each Stock Purchase Agreement (each of which need
        not
        be identical with the terms of other Option Agreements and Stock Purchase
        Agreements) and, with the consent of the holder thereof, to modify or amend
        each
        Option Agreement and Stock Purchase Agreement; (vii) to determine
 whether
        a
        stock repurchase agreement or other agreement will be required to be executed
        by
        any Employee as a condition to the exercise of an Option, and to determine
        the
        terms and provisions of any such agreement (which need not be identical with
        the
        terms of any other such agreement) and, with the consent of the Optionee,
        to
        amend any such agreement; (viii) to interpret this Plan, the Option Agreements,
        the Stock Purchase Agreements or any agreement entered into with respect
        to the
        grant or exercise of Options; (ix) to authorize any person to execute on
        behalf
        of the Company any instrument required to effectuate the grant of an Option
        previously granted by the Board or to take such other actions as may be
        necessary or appropriate with respect to the Company’s rights pursuant to
        Options or agreements relating to the grant or exercise thereof; and (x)
        to make
        such other determinations and establish such other procedures as it deems
        necessary or advisable for the administration of this Plan.
 
 (d)  Effect
        of the Board’s or Committee’s Decision .
        All
        decisions, determinations and interpretations of the Board or the Committee
        shall be final and binding on all Optionees and any other holders of
        Options.
 
 *5.*  Eligibility .
        Options
        may be granted only to Employees, which, as defined herein, includes
        consultants. An Employee who has been granted an Option may, if such Employee
        is
        otherwise eligible, be granted additional Options.
 
 6.  Term
        of Plan .
        This
        Plan shall become effective upon the earlier to occur of its adoption by
        the
        Board or its approval by vote of a majority of the outstanding shares of
        the
 •  Company’s
        capital stock entitled to vote on the adoption of this Plan. This Plan shall
        continue in effect for a term of ten (10) years unless sooner terminated
        in
        accordance with the terms and provisions of this Plan.
 
 7.  Oi,tion  Price
        and Consideration .
  
  
 (a)  Exercise
        Price .
        The
        exercise price per Share for the Shares to be issued pursuant to the exercise
        of
        an Option shall be such price as is determined by the Board; nrovided,
        however ,
        that
        such price shall in no event be less than eighty-five percent (85%) with
        respect
        to Nonstatutory Stock Options, and one hundred percent (100%) with respect
        to
        Incentive Stock Options, of the fair market value per Share on the date of
        grant. In the case of an Option granted to an Employee who, at the time the
        Option is granted, owns stock (as determined under Section 424(d) of the
        Code)
        constituting more than ten percent (10%) of the total combined voting power
        of
        all classes of stock of the Company or its Parent or Subsidiaries, the exercise
        price per Share shall be no less than one hundred ten percent (110%) of the
        fair
        market value per Share on the date of grant.
 
 (b)  Fair
        Market Value .
        The
        fair market value per Share on the date of grant shall be determined by the
        Board in its sole discretion, exercised in good faith and consistent with
        the
        laws of The State of Delaware; provided,  however ,
        that
        where there is a public market for the Common Stock, the fair market value
        per
        Share shall be the average of the closing bid and asked prices of the Common
        Stock on the date of grant, as reported in *The
        Wall Street Journal* (or,
        if
        not so reported, as otherwise reported by the National Association of
        Securities
 Dealers
        Automated Quotations (“NASDAQ”) System), or, in the event the Common Stock is
        listed on a stock exchange or on the NASDAQ System, the fair market value
        per
        Share shall be the closing price on the exchange or on the NASDAQ System
        as of
        the date of grant of the Option, as reported in *The
        Wall Street Journal.*
 
 (c)  Payment
        of Consideration .
        The
        consideration to be paid for the Shares to be issued upon exercise of an
        Option,
        including the method of payment, shall be determined by the Board and may
        consist entirely of cash, check, promissory notes, Shares held by the Optionee
        for the requisite period necessary to avoid a charge to the Company’s earnings
        for financial reporting purposes which have a fair market value on the date
        of
        surrender equal to the aggregate exercise price of the Shares as to which
        said
        Option shall be exercised, or any combination of such methods of payment.
        Subject to subparagraphs (i) through (iv) hereto, utilization of Shares as
        the
        method of payment may be completed by either (a) the tender of Shares then
        held
        by the Optionee, or (b) the withholding of Shares which would otherwise be
        issued pursuant to an Option pursuant to a broker-dealer sale and remittance
        procedure described in subparagraph (iii) hereto. In making its determination
        as
        to the type of consideration to accept, the Board shall consider if acceptance
        of such consideration is deemed to be such as may be reasonably expected
        to
        benefit the Company.
  (i)  If
        the
        consideration for the exercise of an Option is a promissory note, it shall
        be a
        full recourse promissory note executed by the Optionee, bearing interest
        at a
        rate which shall be sufficient to preclude the imputation of interest under
        the
        applicable
 •
              provisions
                  of the Code. Until such time as the promissory note has been paid
                  in full,
                  the Company may retain the Shares purchased upon exercise of the
                  Option in
                  escrow as security for payment of the promissory
                  note.
  
  (ii)  If
        the
        consideration for the exercise of an Option is the surrender of previously
        acquired and owned Shares, the Optionee will be required to make representations
        and warranties satisfactory to the Company regarding his or her title to
        the
        Shares used to effect the purchase, including, without limitation,
        representations and warranties that the Optionee has good and marketable
        title
        to such Shares free and clear of any and all liens, encumbrances, charges,
        equities, claims, security interests, options or restrictions and has full
        power
        to deliver such Shares without obtaining the consent or approval of any person
        or governmental authority other than those which have already given consent
        or
        approval in a form satisfactory to the Company. The value of the Shares used
        to
        effect the purchase shall be the fair market value of those Shares as determined
        by the Board in its sole discretion, exercised in good faith.
  (iii)
        If
        the consideration for the exercise of an Option is to be paid through a
        broker-dealer sale and remittance procedure, the Optionee shall provide (1)
        irrevocable written instructions to a designated brokerage firm to effect
        the
        immediate sale of the purchased shares and to remit to the Company, out of
        the
        sale proceeds available on the settlement date, sufficient funds to cover
        the
        aggregate option price payable for the purchased Shares plus all applicable
        Federal and State income and employment taxes required to be withheld by
        the
 
 Company
        in connection with such purchase and (2) written instructions to the Company
        to
 .
 deliver
        the certificates for the purchased Shares directly to such brokerage firm
        in
        order to complete the sale transaction.
  (iv)
        If
        an Optionee is permitted to exercise an Option by delivering shares of the
        Company’s Common Stock, the option agreement covering such Option may include
        provisions authorizing the Optionce to exercise the Option, in whole or in
        part,
        by: (1) delivering whole shares of the Company’s Common Stock previously owned
        by such Optionee (whether or not acquired through the prior exercise of a
        stock
        option) having a fair market value equal to the option price; and/or (2)
        directing the Company to withhold from the Shares that would otherwise be
        issued
        upon exercise of the Option that number of whole Shares having a fair market
        value equal to the option price. Shares of the Company’s Common Stock so
        delivered or withheld shall be valued at their fair market value on the date
        of
        exercise of the Option, as determined by the Committee and/or the Board,
        as
        appropriate. Any balance of the exercise price shall be paid in cash or by
        check
        or a promissory note, each in accordance with the terms of this Section 7.
        Any
        Shares delivered or withheld in accordance with this provision shall again
        become available for purposes of this Plan and for Options subsequently granted
        thereunder to the extent permissible pursuant to Section 3 of this
        Plan.
  
 
 8.  Options .
 
 (a)  Terms
        and Provisions of  Options .
        As
        provided in Section 4 of this Plan and subject to any limitations specified
        herein, the Board and/or Committee shall have the
 •
              authority
                  to determine the terms and provisions of any Option granted under
                  this
                  Plan or any agreement required to be executed in connection with
                  the grant
                  or exercise of an Option. Each Option granted pursuant to this
                  Plan shall
                  be evidenced by an Option Agreement. Options granted pursuant to
                  this Plan
                  are conditioned upon the Company obtaining any required permit
                  or order
                  from appropriate governmental agencies authorizing the Company
                  to issue
                  such Options and Shares issuable upon exercise
                  thereof.
 
 (b)  Term
        of  Option .
        The
        term of each Option may be up to ten (10) years from the date of grant thereof
        as determined by the Board upon the grant of the Option and specified in
        the
        Option Agreement, except that the term of an Option granted to an Employee
        who,
        at the time the Option is granted, owns stock comprising more than ten percent
        (10%) of the total combined voting power of all classes of stock of the Company
        or its Parent or
 •
              Subsidiaries,
                  shall be five (5) years from the date of grant thereof or such
                  shorter
                  term as may be provided in the Option
                  Agreement.
 
 (c)  Exercise
        of  Option .
 
 (i)  Procedure
        for Exercise: Rights as a Shareholder .
        Any
        Option shall be exercisable at such times, in such installments and under
        such
        conditions as may be determined by the Board and specified in the Option
        Agreement, including performance criteria with respect to the Company and/or
        the
        Optionee, and as shall be permissible under the terms of this Plan.
 .
 An
        Option
        may be exercised in accordance with the provisions of this Plan as to all
        or any
        portion of the Shares then exercisable under an Option, from time to time
        during
        the term of the Option. An Option may not be exercised for a fraction of
        a
        Share.
 
 An
        Option
        shall be deemed to be exercised when written notice of such exercise has
        been
        given to the Company at its principal business office in accordance with
        the
        terms of the Option Agreement by the person entitled to exercise the Option
        and,
        except when the broker-dealer sale and remittance procedure described in
        Section
        7(c)(iii) hereto is used, full payment for the Shares with respect to which
        the
        Option is exercised has been received by the Company, accompanied by an executed
        Stock Purchase Agreement and any other agreements required by the terms of
        this
        Plan and/or the Option Agreement. Full payment may consist of such consideration
        and method of payment allowable under Section 7 of this Plan. Until the Option
        is properly exercised in accordance with the terms of this paragraph, no
        right
        to vote or receive dividends or any other rights as a stockholder exist with
        respect to the Optioned Stock. No adjustment shall be made for a dividend
        or
        other right for which the record date is prior to the date the Option is
        exercised, except as provided in Section 11 of this Plan.
  
 
 As
        soon
        as practicable after any proper exercise of an Option in accordance with
        the
        provisions of this Plan, the Company shall, without transfer or issue tax
        to the
        Optionee, deliver to the Optionee at the principal executive office of the
        Company or such other place as shall be mutually agreed upon between the
        Company
        and the Optionee, a certificate or certificates representing the Shares for
        which the Option shall have been exercised. The time of issuance and delivery
        of
        the certificate(s) representing the Shares for which the Option shall have
        been
        exercised may be postponed by the Company for such period as may be required
        by
        the Company, with reasonable diligence, to comply with any applicable listing
        requirements of any national or regional securities exchange or any law or
        regulation applicable to the issuance or delivery of such Shares. No Option
        may
        be exercised unless this Plan has been duly approved by the shareholders
        of the
        Company in accordance with applicable law. Notwithstanding anything to the
        contrary herein, the terms of.a Stock Purchase Agreement required to be executed
        and delivered in connection with the exercise of an Option may require the
        certificate or certificates representing the Shares purchased upon exercise
        of
        an Option to be delivered and deposited with the Company as security for
        the
        Optionee’s faithful performance of the terms of his Stock Purchase
        Agreement.
 
 Exercise
        of an Option in any manner shall result in a decrease in the number of Shares
        which thereafter may be available, both for purposes of this Plan and for
        sale
        under the Option, by the number of Shares as to which the Option is
        exercised.
 
 (ii)  Termination
        of Status as an Employee .
        If an
        Optionee ceases to serve as an Employee for any reason other than death or
        disability and thereby terminates his or her Continuous Status as an Employee,
        such Optionee shall have the right to exercise the Option at any time within
        thirty (30) days (or such other period of time not exceeding three (3) months
        as
        is determined by the Board at the time of granting the Option), following
        the
        date such Optionee ceases his or her Continuous Status as an Employee of
        the
        Company to the extent that such Optionee was entitled to exercise the Option
        at
        the date of such termination; provided ,
 .
 however ,
        that no
        Option shall be exercisable after the expiration of the term set forth in
        the
        Option Agreement. To the extent that such Optionee was not entitled to exercise
        the Option at the date of such termination, or if such Optionee does not
        exercise such Option (which such Optionee was entitled to exercise) within
        the
        time specified herein, the Option shall terminate.
  
  (iii) Death
        or Disability of  Optionee .
        If an
        Optionee ceases to serve as an Employee due to death or disability and thereby
        terminates his or her Continuous Status as an Employee, the Option may be
        exercised at any time within six (6) months following the date of death or
        termination of employment due to disability, in the case of death, by the
        Optionee’s estate or by a person who acquired the right to exercise the Option
        by bequest or inheritance, or, in the case of disability, by the Optionee,
        but
        in any case only to the extent the Optionee was entitled to exercise the
        Option
        at the date of his or her termination of employment by death or disability; provided,  however ,
        that no
        Option shall be exercisable after the expiration of the Option term set forth
        in
        the Option Agreement. To the extent that such Optionee was not entitled to
        exercise such Option at the date of his or her termination of employment
        by
        death or disability or if such Option is not exercised (to the extent it
        could
        be exercised) within the time specified herein, the Option shall
        terminate.
 
 (iv) Extension
        of Time to Exercise .
        Notwithstanding anything to the contrary in this Section 8, the Board may
        at any
        time and from time to time prior to the termination of a Nonstatutory Stock
        Option, with the consent of the Optionee, extend the period of time during
        which
        the Optionee may exercise his or her Nonstatutory Stock Option following
        the
        date the Optionee ceases such Optionee’s Continuous Status as an Employee; provided,
        however ,
        that
        (1) the maximum period of time during which a Nonstatutory Stock Option shall
        be
        exercisable following such termination date shall not exceed an aggregate
        of six
        (6) months,
 (2)
        the
        Nonstatutory Stock Option shall not become exercisable after the expiration
        of
        the term of such Option as set forth in the Option Agreement as a result
        of such
        extension, and (3) notwithstanding any extension of time during which the
        Nonstatutory Stock Option may be exercised, such Option, unless otherwise
        amended by the Board, shall only be exercisable to the extent to which the
        Optionee was entitled to exercise it on the date Optionee ceased Continuous
        Status as an Employee. To the extent that such Optionee was not entitled
        to
        exercise the Option at the date of such termination, or if such Optionee
        does
        not exercise an Option which Optionee was entitled to exercise within the
        time
        specified herein, the Option shall terminate.
 
 9.  Limit  on  Incentive
        Stock  Options .
        The
        aggregate fair market value (determined at the time an Incentive Stock Option
        is
        granted) of the Shares which may be acquired upon exercise of Incentive Stock
        Options for the first time by an Optionee during any calendar year under
        all
        incentive stock option plans of the Company, its Parents or its Subsidiaries,
        if
        any, cannot exceed One Hundred Thousand Dollars ($100,000). Incentive Stock
        Options which exceed this limit must be treated as Nonstatutory Stock Options.
        The Board shall determine, in accordance with the Code, which of an Optionee’s
        Incentive Stock Options will not be treated as Incentive Stock Options as
        a
        result of such limitation and will so notify the Optionee as soon as practicable
        following such determination.
  
 
 •
              10.Nontransferabilitv
                  ofOptions.
                  Options granted under this Plan may not be
                  sold,
 •
              pledged,
                  assigned, hypothecated, gifted, transferred or disposed of in any
                  manner,
                  eithervoluntarily
                  or involuntarily by operation of law, other than by will or by
                  the laws of
                  descent ordistribution,
                  and may be exercised during the lifetime of the Optionee only by
                  such
                  Optionee.
  11. Adjustments  Upon
        Chances in  Capitalization
        or Corporate Change .
 
 (a)  Subject
        to any required action by the shareholders of the Company, the number of
        Shares
        covered by each outstanding Option, and the number of Shares which have been
        authorized for issuance under this Plan but as to which no Options have yet
        been
        granted or which have been returned to this Plan upon cancellation or expiration
        of an Option or repurchase of shares from an Optionee upon termination of
        employment or service, as well as the exercise or purchase price per Share
        covered by each such outstanding Option, shall be proportionately adjusted
        for
        any increase or decrease in the number of issued Shares resulting from a
        stock
        split, reverse stock split, combination or reclassification of the Common
        Stock,
        or the payment of a stock dividend (but only on the Common Stock) or any
        other
        increase or decrease in the number of issued shares of Common Stock effected
        without receipt of consideration by the Company (other than stock bonuses
        to
        Employees, including, without limitation, officers and directors); provided,  however ,
        that
        the conversion of any convertible securities of the Company shall not be
        deemed
        to have been effected without the receipt of consideration. Such adjustment
        shall be made by the Board, whose determination in that respect shall be
        final,
        binding and conclusive. Except as expressly provided herein, no issue by
        the
        Company of shares of stock of any class, or
 •  securities
        convertible into shares of stock of any class, shall affect, and no adjustment
        by reason thereof shall be made with respect to, the number or price of Shares
        subject to this Plan or an Option.
 
 (b)  In
        the
        event of a Corporate Change effected by a transaction in which the consideration
        therefor consists only of stock of another issuer, then the Plan, all Options
        and Option Agreements in force at the date of the Corporate Change shall
        continue to be in full force and effect and shall be assumed by the merging
        or
        acquiring entity.
 
 (c)  In
        the
        event of a Corporate Change effected by a transaction in which the consideration
        therefor does not consist solely of the stock of another issuer (e.g., an
        all
        cash or part cash and part stock transaction), then all Options which are
        not
        vested and exercisable at that date shall tenninate immediately.
 
 (d)  No
        fractional shares of Common Stock shall be issuable on account of any action
        described in this Section, and the aggregate number of shares into which
        Shares
        then covered by the Option, when changed as the result of such action, shall
        be
        reduced to the largest number of whole shares resulting from such action,
        unless
        the Board, in its sole discretion, shall determine to issue scrip certificates
        in respect to any fractional shares, which scrip certificates, in such event,
        shall be in a form and have such terms and conditions as the Board in its
        discretion shall prescribe.
  
 .
 •
              12.Time
                  ofGranting
                  Options.
                  The date of grant of an Option shall be the date on which the Board
                  makes
                  the determination granting such Option;provided,however,
                  that if the Board determines that such grant shall be as of some
                  future
                  date, the date of grant shall be such future date. Notice of the
                  determination shall be given to each Employee to whom an Option
                  is so
                  granted within a reasonable time after the date of such
                  grant.
 
 13. Amendment  and  Termination  of  this  Plan .
 
 (a)  Amendment
        and Termination .
        The
        Board may amend or terminate this Plan from time to time in such respects
        as the
        Board may deem advisable and shall make any amendments which may be required
        so
        that Options intended to be Incentive Stock Options shall at all times continue
        to be Incentive Stock Options for the purpose of the Code, except that, without
        approval of the holders of a majority of the outstanding shares of the Company’s
        capital stock, no such revision or amendment shall:
 
 (i)
        Increase the number of Shares subject to this Plan, other than in connection
        with an adjustment under Section 11 of this Plan;
 
 (ii)
        Materially change the designation of the class of Employees eligible to be
        granted Options;
 
 (iii)
        Remove the administration of this Plan from the Board (other than to the
        Committee);
 
 (iv)
        Materially increase the benefits accruing to participants under this Plan;
        or
 
 (v)
        Extend the term of this Plan.
 
 (b)  Effect
        of Amendment or Termination .
        Except
        as otherwise provided in Section 11, any amendment or termination of this
        Plan
        shall not affect Options already granted and such Options shall remain in
        full
        force and effect as if this Plan had not been amended or terminated, unless
        mutually agreed otherwise between the Optionee and the Company, which agreement
        must be in writing and signed by the Optionee and the Company.
  
 
 14. Conditions  Upon  Issuance  of  Shares .
 
 (a)  Shares
        shall not be issued pursuant to the exercise of an Option unless the exercise
        of
        such Option and the issuance and delivery of such Shares pursuant thereto
        shall
        comply with all relevant provisions of law, including, without limitation,
        the
        Securities Act, the Exchange Act, applicable state securities laws, the rules
        and regulations promulgated thereunder, and the requirement of any stock
        exchange upon which the Shares may then be listed, and shall
 
 be
        further subject to the approval of counsel for the Company with respect to
        such
        compliance.
 .
 (b)  As
        a
        condition to the exercise of an Option, the Board may require the person
        exercising such Option to execute an agreement with, and/or may require the
        person exercising such Option to make any representation and warranty to,
        the
        Company as may in the judgment of counsel to the Company be required under
        applicable law or regulation, including but not limited to a representation
        and
        warranty that the Shares are being purchased only for investment and without
        any
        present intention to sell or distribute such Shares if, in the opinion of
        counsel for the Company, such a representation is appropriate under any of
        the
        aforementioned relevant provisions of law.
 
 15. Reservation
        of  Shares .
        The
        Company, during the term of this Plan, at all times shall reserve and keep
        available such number of Shares as shall be sufficient to satis& the
        requirements of this Plan.
 
 The
        Company, during the term of this Plan, shall use diligent efforts to seek
        to
        obtain
 •
              from
                  appropriate regulatory agencies any requisite authorization in
                  order to
                  issue and sell such number of Shares as shall be sufficient to
                  satis&
                  the requirements of this Plan. The inability of the Company to
                  obtain the
                  requisite authorization(s) deemed by the Company’s counsel to be necessary
                  for the lawful issuance and sale of any Shares hereunder, or the
                  inability
                  of the Company to confirm to its satisfaction that any issuance
                  and sale
                  of any Shares hereunder will meet applicable legal requirements,
                  shall
                  relieve the Company of any liability in respect to the failure
                  to issue or
                  sell such Shares as to which such requisite authority shall not
                  have been
                  obtained.
  
  16. Stock
        Option and Stock Purchase Agreements .
        Options
        shall be evidenced by written stock option agreements in such form or forms
        as
        the Board shall approve from time to time. Upon the exercise of an Option,
        the
        Optionee shall sign and deliver to the Company a
 •
              Stock
                  Purchase Agreement (if required to be executed and delivered to
                  the
                  Company by an Optionee as a condition to the exercise of an Option)
                  in
                  such form or forms as the Board shall approve from time to
                  time.
 
 17. Shareholder
        Approval .
        Continuance of this Plan shall be subject to approval by the shareholders
        of the
        Company within twelve (12) months before or after the date this Plan is adopted
        by the Board. If such shareholder approval is obtained at a duly held
        shareholders’ meeting, it may be obtained by the affirmative vote of the holders
        of a majority of the outstanding shares of the Company entitled to vote thereon.
        All Options granted prior to shareholder approval of this Plan are subject
        to
        such approval, and if such approval is not obtained within twelve (12) months
        before or after the date this Plan is adopted by the Board all such Options
        shall expire and shall be of no further force or effect.
 
 18. Taxes,
        Fees. Expenses and  Withholding  of  Taxes .
 
 (a)  The
        Company shall pay all original issue and transfer taxes (but not income taxes,
        if any) with respect to the grant of Options and/or the issue and transfer
        of
        Shares pursuant to the exercise thereof, and all other fees and expenses
        necessarily incurred by the Company in connection therewith, and will from
        time
        to time use diligent efforts to comply with
 all
        laws
        and regulations which, in the opinion of counsel for the Company, shall be
        applicable thereto.
 
 (b)  The
        grant
        of Options hereunder and the issuance of Shares pursuant to the exercise
        thercof
        is conditioned upon the Company’s reservation of the right to withhold, in
        accordance with any applicable law, from any compensation payable to the
        Optionee any taxes required to be withheld by federal, state or local law
        as a
        result of the grant or exercise of such Option or the sale of the Shares
        issued
        upon exercise thereof. To the extent that compensation or other amounts,
        if any,
        payable to the Optionee are insufficient to pay any taxes required to be
        so
        withheld, the Company may, in its sole discretion, require the Optionee,
        as a
        condition of the exercise of an Option, to pay in cash to the Company an
        amount
        sufficient to cover such tax liability or otherwise to make adequate provision
        for the Company’s satisfaction of its withholding obligations under federal and
        state law.
 
 (c)  The
        Board
        or the Committee may, in its discretion and upon such terms and conditions
        as it
        may deem appropriate (including the applicable safe-harbor provisions of
        SEC
        Rule 16b-3 and interpretations thereof by the staff of the Securities and
        Exchange Commission) provide any or all holders of outstanding option grants
        under this Plan with the election to have the Company withhold, from the
        shares
        of Common Stock otherwise issuable upon the exercise of such options, one
        or
        more of such shares with an aggregate fair market value equal to the designated
        percentage (any multiple of *5%* specified
        by the optionee) of the Federal and State income taxes (“Taxes”) incurred in
        connection with the acquisition of such
 •
              Shares.
                  In lieu of such direct withholding, one or more optionees may also
                  be
                  granted the right to deliver shares of Common Stock to the Company
                  in
                  satisfaction of such Taxes. The withheld or delivered shares shall
                  be
                  valued at the Fair Market Value on the applicable determination
                  date for
                  such Taxes or such other date required by the applicable safe-harbor
                  provisions of SEC Rule 1 6b-3.
  
  19. Liability
        of Company .
        The
        Company, its Parent or any Subsidiary which is in existence or hereafter
        comes
        into existence shall not be liable to an Optionee or other person if it is
        determined for any reason by the Internal Revenue Service or any court having
        jurisdiction that any Options intended to be Incentive Stock Options granted
        hereunder do not qualify as incentive stock options within the meaning of
        Section 422 of the Code.
 
 20. Information
        to Optionee .
        The
        Company shall provide without charge at least annually to each Optionee during
        the period his or her Option is outstanding a balance sheet and income statement
        of the Company. In the event that the Company provides annual reports or
        periodic reports to its shareholders during the period in which an Optionee’s
        Option is outstanding, the Company shall provide to each Optionee a copy
        of each
        such report.
 
 21. Notices .
        Any
        notice required or permitted hereunder shall be given in writing and shall
        be
        deemed effectively given upon personal delivery or upon deposit in the United
        States mail, as first class, registered or certified mail, with postage and
        fees
        prepaid and addressed (i) if to the Company, at its principal place of business,
        attention: Secretary, or (ii) if to the Optionee at his or her address as
        set
        forth on the signature page of his or her Option Agreement, or at
        such
 other
        address as either party may from time to time designate in writing to other.
        It
        shall be the obligation of each Optionee and each transferee holding Shares
        purchased upon exercise of an Option to provide the Secretary of the Company,
        by
        letter mailed as provided hereinabove, with written notice of his or her
        direct
        mailing address.
 
 22.  No
        Enlargement of  Employee  Rights .
        This
        Plan is purely voluntary on the part of the Company, and the continuance
        of this
        Plan shall not be deemed to constitute a contract between the Company and
        any
        Employee, or to be consideration for or a condition of the employment or
        service
        of any Employee. Nothing contained in this Plan shall be deemed to give any
        Employee the right to be retained in the employ or service of the Company,
        its
        Parent, Subsidiary or a successor corporation, or to interfere with the right
        of
        the Company or any such corporations to discharge or retire any Employee
        at any
        time with or without cause and with or without notice. No Employee shall
        have
        any right to or interest in Options authorized hereunder prior to the grant
        thereof to such Employee, and upon such grant such Employee shall have only
        such
        rights and interests as are expressly provided herein, subject, however,
        to all
        applicable provisions of the Company’s Articles of Incorporation, as the same
        may be amended from time to time.
  
  23.  Legends
        on  Certificates .
 
 (a)  Federal
        Law .
        Unless
        an appropriate registration statement is filed pursuant to the Securities
        Act of
        1933 with respect to the Options and Shares issuable under this
 •  Plan,
        each document or certificate representing such Options or Shares shall be
        endorsed thereon with a legend substantially as follows:
  “THIS
        OPTION AND THE SECURITIES WHICH MAY BE
 PURCHASED
        UPON EXERCISE OF THIS SECURITY HAVE
 NOT
        BEEN
        REGISTERED UNDER THE SECURITIES ACTOF
 1933,
        AS
        AMENDED, AND HAVE BEEN ACQUIRED FOR
 INVESTMENT
        AND NOT WITH A VIEW TO, OR IN
 CONNECTION
        WITH, THE SALE OR DISTRIBUTION
 THEREOF.
        NO SALE, TRANSFER, OR DISTRIBUTION MAY
 BE
        EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
 STATEMENT
        RELATING THERETO OR AN OPINION OF
 COUNSEL
        SATISFACTORY TO THE COMPANY THAT
 SUCH
        REGISTRATION IS NOT REQUIRED.”
 
 (b)  California
        Legend .
        If
        required by the California Commissioner of Corporations, each document or
        certificate representing the Options or Shares issuable under this Plan shall
        be
        endorsed thereon with a legend substantially as follows:
 
 **S**
 “IT
        IS
        UNLAWFUL TO CONSUMMATE A SALE OR
 TRANSFER
        OF THIS OPTION AND THE SECURITIES
 WHICH
        MAY
        BE PURCHASED UPON EXERCISE OF THIS
 OPTION,
        OR ANY INTEREST THEREIN, OR TO RECEIVE
 ANY
        CONSIDERATION THEREFOR, WITHOUT THE PRIOR
 WRITTEN
        CONSENT OF THE COMMISSIONER OF
 CORPORATIONS
        OF THE STATE OF CALIFORNIA, EXCEPT
 AS
        PERMITtED IN THE COMMISSIONER’S RULES.”
  
 
 (c)  Additional
        Legends .
        Each
        document or certificate representing the Options or Shares issuable under
        this
        Plan shall also contain the legends as may be required under California law
        or
        other applicable state or federal securities laws or by any Stock Purchase
        Agreement or other agreement the execution of which is a condition to the
        exercise of an Option under this Plan including a legend substantially as
        follows:
 
 ‘THIS
        OPTION AND THE SECURITIES WHICH MAY BE
 PURCHASED
        UPON EXERCISE OF THIS OPTION, OR ANY
 INTEREST
        THEREIN, ARE SUBJECT TO CERTAIN
 RESTRICTIONS,
        INCLUDING A RIGHT OF FIRST REFUSAL
 OF
        THE
        COMPANY, AND MAY BE TRANSFERRED ONLY
 IN
        ACCORDANCE WITH THE TERMS OF AN AGREEMENT
 BETWEEN
        THE COMPANY AND THE SHAREHOLDER, A
 COPY
        OF
        WHICH IS ON FILE WITH THE SECRETARY OF  THE
        COMPANY.”
 
 24. Availability  of  Plan .
        A copy
        of this Plan shall be delivered to the Secretary of the Company and shall
        be
        shown by him to any eligible person making reasonable inquiry concerning
        it.
 
 *25.* Compliance
        with Exchange Act Rule 16b-3 .
        With
        respect to persons subject to Section 16 of the Exchange Act, transactions
        under
        this Plan are intended to comply with all applicable conditions of Rule 16b-3,
        promulgated pursuant to the Exchange Act, or its successors. To the extent
        any
        provision of this Plan or action by the Board or any Committee fails so to
        comply, it shall be deemed null and void to the extent permitted by law and
        deemed advisable by the Board or any Committee.
 
 26. Invalid
        Provisions .
        In the
        event that any provision of this Plan is found to be invalid or otherwise
        unenforceable under any applicable law, such invalidity or unenforceability
        shall not be construed as rendering any other provisions contained herein
        as
        invalid or unenforceable, and all such other provisions shall be given full
        force and effect to the same extent as though the invalid or unenforceable
        provision was not contained herein.
 
 27. Applicable
        Law .
        This
        Plan shall be governed by and construed in accordance with the laws of The
        State
        of Nevada.
  
 
 As
        adopted by the Board of Directors on September 1, 2004.
  Signed:
              /s/Philip
                  PesinName:
              Philip
                  S. PesinTitle:
              Chairman
                  of the Board