ex10_12.htm


    
      

    

    
       

      Exhibit
        No. 10.12

      


      EMPLOYMENT
        AGREEMENT

      


      


      THIS
        EMPLOYMENT AGREEMENT (this "Agreement") is entered into as of May 1, 2006
        by and
        between Shearson Financial Network, Inc., a Nevada corporation (the "Company")
        and Michael A. Barron ("Executive").

      


      WITNESSETH:

      


      WHEREAS,
        the Company and Executive desire to enter into this Agreement to assure the
        Company of the continuing and exclusive service of Executive and to set forth
        the terms and conditions of Executive's employment with the
        Company.

      


      NOW,
        THEREFORE, in consideration of the mutual promises and covenants set forth
        herein, the parties agree as follows:

      


      1.  Term: The
        Company agrees to employ Executive and Executive hereby accepts such employment,
        in accordance with the terms of this Agreement, commencing as of the date
        hereof
        and ending on the third anniversary of the date hereof unless this Agreement
        is
        earlier terminated as provided herein. Notwithstanding any other provision
        of
        this Agreement, the Company shall have an obligation to make any payments
        to
        Executive for Base Salary and Bonuses, as defined below and as required by
        this
        Agreement.

      


      2.  Services
        and Exclusivity of Services: So long as this
        Agreement shall continue in effect, Executive shall devote Executive's full
        business time, energy and ability to the matters related thereto in order
        to
        perform duties as assigned by the Board of directors of the Company (the
        "Board"), Executive shall use Executive's best efforts and abilities to promote
        the Company's interests and shall perform the services contemplated by this
        Agreement in accordance with policies established by and under the direction
        of
        the Board. Executive agrees to serve without additional remuneration in such
        executive capacities for one or more direct or indirect Affiliates of the
        Company as the Board may from time to time request, subject to appropriate
        authorization by the Affiliate or Affiliates involved and any limitations
        under
        applicable law. Executive agrees to faithfully and diligently promote the
        business, affairs and interests of the Company and its Affiliates.

      


      Without
        the prior express written authorization of the Board, Executive shall not,
        directly or indirectly, during the term of this Agreement engage in any activity
        competitive with or adverse to the Company's business, whether alone, as
        a
        partner, officer, director, employee or significant investor of or in any
        other
        entity. (An investment of greater than 5% of the outstanding capital or equity
        securities of an entity shall be deemed significant for these
        purposes.)


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      Executive
        represents to the Company that Executive has no other outstanding commitments
        inconsistent with any of the terms of this Agreement or the services to be
        rendered hereunder.

      


      3.  Duties
        and Responsibilities: In addition to his
        duties as an employee as discussed herein, Executive shall serve as Chief
        executive Officer of the Company for the duration of this Agreement. Executive's
        duties as an Executive shall be overall responsibility and authority, subject
        to
        authorities and limitations as established by the "Board", to implement and
        continue to develop the business strategies of the Company. In the performance
        of Executive's duties, Executive shall report directly to and shall be subject
        to the direction of the Board of Directors.

      


      Executive
        agrees to observe and comply with the rules and regulations of the Company
        as
        adopted by the Board respecting the performance of Executive's duties and
        agrees
        to carry out and perform orders, directions and policies of the Company and
        its
        Board as they may be, from time to time, stated either orally or in writing.
        The
        Company agrees that the duties which may be assigned to Executive shall be
        usual
        and customary duties of the position(s) to which Executive may from time
        to time
        be appointed or elected and shall not be inconsistent with the provisions
        of the
        charter documents of the Company or applicable law. Executive shall have
        such
        corporate power and authority as shall reasonably be
        required to enable Executive to perform the duties required in
        any
        office that may be held, subject to the limitations on such powers imposed
        by
        the Board.

      


      4.  Compensation:

      


      Base
        Compensation:

      


      During
        the term of this Agreement, the Company agrees to pay Executive a base salary
        at
        the rate of $300,000.00 per year from the date hereof to May 1, 2009, subject
        to
        increases at the discretion of the Compensation Committee of the Board, payable
        in accordance with the Company practices in effect from time to
        time.

      


      Bonuses:

      


      Executive
        shall be eligible for General Bonuses (as defined below) and Performance
        Bonuses
        (as defined below) as follows (collectively, "Bonuses"):

      


      General
        Bonuses: Executive shall be eligible for bonuses in accordance with any
        bonus or other incentive compensation plans adopted by
        the Board ("General Bonuses").


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      Performance
        Bonuses: With respect to each fiscal year in which the actual revenues and
        net income of the Company after taxes (as determined by the Company's public
        accountants) equal or exceed the actual projected revenue and net income
        amounts
        set forth in the budget projections approved by the Board for such fiscal
        year,
        the Company shall pay the Executive a bonus (the "Performance Bonus"). The
        Performance Bonus shall be in an amount equal to (a) 50% of the Base Salary
        on
        the last day of such fiscal year plus (b) the product of the Base Salary
        on the
        last day of such fiscal year, multiplied by the percentage by which the
        Company's actual net income for such fiscal year exceeded it projected net
        income for such fiscal year, if any.

      


      Deferral
        of Performance Bonuses: Notwithstanding anything else contained herein to
        the contrary, Executive may elect in writing on forms provided by the Company
        to
        receive the entire Performance Bonus in the form of restricted stock if
        Executive makes such election prior to December 31 of the fiscal year to
        which
        the Performance Bonus relates.

      


      Restricted
        Stock: All shares of restricted stock awarded pursuant to this Agreement
        will be granted subject to the terms and restrictions on the actual certificate
        as issued at time of signing this Agreement. Executive shall be eligible
        under
        the plan as approved by the Board of Directors to receive one million (1)
        shares. Such shares shall vest over a 3-year period and only upon satisfaction
        of Executives performance, the shares shall be exercisable in part for each
        month of employment completed or in whole after 3 years from date
        hereof

      


      Additional
        Benefits: The Company agrees to provide the following "Additional Benefits"
        to Executive:

      


      Medical
        plan coverage for Executive, his spouse and dependents, if any, at the expense
        of the Company, with such coverage (or comparable coverage) to continue
        following termination of employment (other than for "Cause" or without "Good
        Reason" as each term is defined in this Agreement) until Executive and spouse
        are eligible for Medicare; and

      


      All
        rights and benefits for which Executive is otherwise eligible under any pension
        plan, profit-sharing plan, dental, disability, or insurance plan or policy
        or
        other plan or benefit that the Company or its Affiliates may provide for
        Executive or (provided Executive is eligible to participate therein) for
        employees of the Company generally, as from time to time in effect, during
        the
        term of this Agreement.

      


      Stock
        Options: Executive shall be eligible for stock option grants under the
        Company's stock option plans as administered by the Board or the Compensation
        Committee of the Board. Affirmatively, Executive shall have the right to
        purchase one million (1) shares of the $.001 par value common stock at a
        purchase price of Fifty Cents ($.0.50) or the price of the initial Registration
        Statement to be filed with the Securities and Exchange Commission Form SB-2
        whichever is the lower. The purchase price shall be determined based on the
        lower of the two prices. The Company at its option and sole discretion shall
        establish the exercise period in accordance with the Company stock option
        plan.


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      


      Perquisites:
        Executive shall be entitled to four weeks paid vacation and other perquisites
        in
        accordance with the plans, policies, programs and practices which are at
        least
        as favorable as those in effect with respect to other peer employees of the
        Company.

      


      Auto
        Allowance: Executive shall be paid $2,000.00 per month payable on the
        1st of
        every month for the use of their auto for company related business.

      


      5.  Termination: This
        Agreement and all obligations hereunder (except the obligations contained
        in
        Sections 4(c), 8, 9, 10 and 11 (Additional Benefits, Confidential Information,
        Non-Competition, No Solicitation of Customers and Noninterference with
        Executives) which shall survive any termination hereunder) shall terminate
        upon
        the earliest to occur of any of the following:

      


      Expiration
        of Term: The expiration of the term provided for in Section 1 or the
        voluntary termination by Executive or retirement from the Company in accordance
        with the normal retirement policies of the Company.

      


      Death
        or Disability of Executive: The death or disability of Executive. For the
        purposes of this Agreement, disability shall mean the absence of Executive
        performing Executive's duties with the Company on a full-time basis for a
        period
        of six months period, as a result of incapacity due to mental or physical
        illness which is determined to be total and permanent by a physician
        selected by the Company or its insurers and acceptable to Executive or
        Executive's legal representative (such agreement as to acceptability not
        to be
        withheld unreasonably). If Executive shall become disabled, Executive's
        employment may be terminated by written notice from the Company to Executive.
        All scheduled and accrued salary and any bonuses shall be paid to Executive's
        legal representative upon demand from Executive's legal
        representative.

      


      For
        Cause or Without Good Reason: The Company may terminate Executive's
        employment and all of Executive's rights to receive Base Salary and Bonuses
        hereunder for Cause or upon the resignation of Executive without Good Reason.
        For purposes of this Agreement, the term "Cause" shall be limited to the
        willful
        commission of a felony or other act of moral turpitude which directly and
        demonstrably causes material, tangible harm to the Company, and "Good Reason"
        shall be defined as (i) demotion of Executive from the position of President
        without the consent of Executive; (ii) any attempt to decrease Executive's
        Base
        Salary or Bonuses; (iii) any breach of this Agreement by the Company; or
        (iv)
        any requirement that Executive relocate to an office more than 30 miles further
        from Executive's current home address than the Company's current
        office.


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      Notwithstanding
        the foregoing, Executive shall not be terminated for Cause pursuant to this
        Section 5(c) unless and until Executive has received notice of a proposed
        termination for Cause and Executive has had an opportunity to be heard before
        at
        least a majority of the members of the Board. Executive shall be deemed to
        have
        had such an opportunity if given written or telephonic notice at least 72
        hours
        in advance of a meeting. The initial determination that Cause or Good Reason
        exists shall be made by the Board. Any dispute regarding such determination
        shall be resolved in accordance with Section 20 of this Agreement.

      


      Without
        Cause or With Good Reason: Notwithstanding any other provision of this
        Section 5, the Board shall have the right to terminate Executive's employment
        with the Company without Cause, and Executive shall have the right to resign
        with Good Reason, at any time. If the Company terminates Executive without
        Cause
        or Executive terminates for Good Reason, then the Company shall, within 10
        days
        of such termination, make an immediate lump sum payment in the amount of
        (i) two
        times the applicable Base Salary, net of applicable taxes, plus (ii) the
        present
        value of the Base Salary and Bonuses (based on the assumption that the Company
        would achieve all performance targets for a 100% bonus), and the Company
        shall
        provide the Additional Benefits provided for under Section 4(c) for the
        remainder of the term, including the full vesting of Stock Options and any
        gross
        up of lump sum distributions due to tax effect. The present value of the
        aggregate unpaid Base Salary and Bonuses shall be determined under the then
        applicable federal rates under the Internal Revenue Code. Further, if Executive
        is terminated without Cause or resigns with Good Reason, all stock options
        held
        by Executive shall become fully vested. All deferred salaries to include
        any and
        all notes on the books due executive shall become due and payable within
        24
        hours of termination.

      


      6.  Business
        Expenses: During the term of this Agreement,
        the Company shall reimburse Executive promptly for business expenditures
        made
        and substantiated in accordance with policies, practices and procedures
        established from time to time by the Company generally with respect to other
        employees and incurred in the pursuit and furtherance of the Company's business
        and good will.

      


      7.  Parachute
        Limitations: Notwithstanding any other
        provision of this Agreement or of any other agreement, contract or understanding
        heretofore or hereafter entered into by Executive with the Company or any
        Affiliate, except an agreement, contract or understanding hereafter entered
        into
        that expressly modifies or excludes application of this Section 7 (the "Other
        Agreements"), and notwithstanding any formal or informal plan or other
        arrangement heretofore or hereafter adopted by the Company or any Affiliate
        for
        the direct or indirect compensation of Executive, whether or not such
        compensation is deferred, is in cash, or is in the form of an option or other
        benefit to or for Executive (a "Benefit Plan"), Executive shall not have
        any
        right to exercise an option or to receive any payment or other benefit under
        this Agreement, any Other Agreement or any Benefit Plan if such right to
        exercise, payment or benefit, taking into account all other rights, payments,
        or
        benefits to or for Executive under this Agreement, all Other Agreements and
        all
        Benefit Plans, would cause any right, payment, or benefit to Executive under
        this Agreement to be considered a "parachute payment" within the meaning
        of
        Section 280G(b)(2) of the Internal Revenue Code as then in effect (a Parachute
        Payment"). In the event that the receipt of any such right to exercise or
        any
        other payment or benefit under this Agreement, any Other Agreement or any
        Benefit Plan would cause Executive to be considered to have received a Parachute
        Payment under this Agreement, then Executive shall have the right, in
        Executive's sole discretion, to designate those rights, payments or benefits
        under this Agreement, any Other Agreement, and/or any Benefit Plans, that
        should
        be reduced or eliminated so as to avoid having the right, payment or benefit
        to
        Executive under this Agreement be deemed to be a Parachute
        Payment.


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      8.  Confidential
        Information: Executive acknowledges that the
        nature of Executive's engagement by the Company is such that Executive shall
        have access to information of a confidential and/or trade secret nature which
        has great value to the Company and which constitutes a substantial basis
        and
        foundation upon which the business of the Company is based. Such information
        includes financial, manufacturing and marketing data, techniques, processes,
        formulas, developmental or experimental work, work in process, methods, trade
        secrets (including, without limitation, customer lists and lists of customer
        sources), or any other secret or confidential information relating to the
        products, services, customers, sales or business affairs of the Company or
        its
        Affiliates (the "Confidential Information"). Executive shall keep all such
        Confidential Information in confidence during the term of this Agreement
        and at
        any time thereafter and shall not disclose any of such Confidential Information
        to any other person, except to the extend such disclosure is (i) required
        by
        applicable law, (ii) lawfully obtainable from other sources, or (iii) authorized
        in writing by the Company. Upon termination of Executive's employment with
        the
        Company, Executive shall deliver to the Company all documents, records,
        notebooks, work papers, and all similar material containing any of the foregoing
        information, whether prepared by Executive, the Company or anyone
        else.

      


      9.  Non-Competition: In
        order to protect the Confidential Information, Executive agrees that during
        the
        term of Executive's employment, and for a period of one year thereafter if
        Executive employment is terminated by the Company with Cause or by Executive
        without Good Reason, Executive shall not, directly or indirectly, whether
        as an
        owner, partner,. shareholder, agent, employee, creditor or otherwise, promote,
        participate or engage in any activity or other business competitive with
        the
        Company's business or the business of any present Affiliate of the Company
        in
        Las Vegas, Nevada if such activity or other business involves any use by
        Executive of any of the Confidential Information. The Company shall notify
        Executive of any perceived violation of this Section 9, and Executive shall
        have
        30 days to cure such violation.


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      10.  Non-Solicitation
        of Customers: Executive agrees that for a
        period of one year after the termination of employment with the Company,
        Executive will not, on behalf of any other individual, association or entity,
        call on any of the customers of the Company or any Affiliate of the Company
        for
        the purpose of soliciting or inducing any of such customers to acquire (or
        providing to any of such customers) any product or service provided by the
        Company or any Affiliate of the Company, nor will Executive in any way, directly
        or indirectly, as agent or otherwise, in any other manner solicit, influence
        or
        encourage such customers to take away or to divert or direct their business
        to
        Executive or any other person or entity by or with which Executive is employed,
        associated, affiliated or otherwise related if such business is competitive
        with
        the Company.

      


      11.  Noninterference
        with Executives: In order to protect the
        Confidential Information, Executive agrees that during the term hereof and
        for a
        period of one year thereafter, Executive will not, directly or indirectly,
        induce or entice any employee of the Company or its Affiliates to leave such
        employment or cause anyone else to leave such employment.

      


      12.  Indemnity: To
        the fullest extend permitted by applicable law and the bylaws of the Company,
        as
        from time to time in effect, the Company shall indemnify Executive and hold
        Executive harmless for any acts or decisions made in good faith while performing
        services for the Company, and the Company shall use its best efforts to obtain
        coverage for Executive (provided the same may be obtained at reasonable cost)
        under any liability insurance policy or policies now in force or hereafter
        obtained during the term of this Agreement that cover other officers of the
        Company having comparable or lesser status and responsibility. The Company
        will
        pay and, subject to any legal limitations, advance all expenses, including
        reasonable attorneys' fees and costs of court approved settlements, actually
        and
        necessarily incurred by Executive in connection with the defense of any action,
        suit or proceeding and in connection with any appeal thereon, which has been
        brought against Executive by reason of Executive's service as an officer
        or
        agent of the Company or of any Affiliate of the Company.

      


      13.  Severability: If
        any provision of this Agreement is held to be unenforceable for any reason,
        it
        shall be adjusted rather than voided, if possible, to achieve the intent
        of the
        parties to the extent possible. In any event, all other provisions of this
        Agreement shall be deemed valid and enforceable to the extent
        possible,

      


      14.  Succession: This
        Agreement shall inure to the benefit of and be binding upon the Company and
        its
        successors and assigns and any such successor or assignee shall be deemed
        substituted for the Company under the terms of this Agreement for all purposes.
        As used herein, "successor" and "assignee" shall include any person, firm,
        corporation or other business entity which at any time, whether by purchase,
        merger or otherwise, directly or indirectly acquires the stock of the Company
        or
        to which the Company assigns this Agreement by operation of law or
        otherwise. The obligations and duties of Executive hereunder are personal
        and
        otherwise not assignable. Executive's obligations and representations under
        this
        Agreement will survive the termination of Executive's employment, regardless
        of
        the manner of such termination.


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                15.  Notices: Any
                  notice or other communication provided for in this Agreement shall
                  be in
                  writing and sent if to the Company to its office
                  at:

              


      

      


      6330
        S. Sandhill Road, Suite # 8

      Las
        Vegas, Nevada 89120

      (702)
        868-7900

      


      or
        at such other address as the Company may from time to time in writing designate,
        and if to Executive at such address as Executive may from time to time in
        writing designate. Each such notice or other communication shall be effective
        (i) if given by telecommunication, when transmitted to the applicable number
        so
        specified in (or pursuant to) this Section 16 and a verification of receipt
        is
        received, (ii) if given by mail, three days after such communication is
        deposited in the mails with first class postage prepaid, addressed as aforesaid
        or (iii) if given by any other means, when actually delivered at such
        address.

      


      Any
        notice or other communication provided for in this Agreement shall be in
        writing
        and sent if to the Executive at:

      


      8
        Belfast Court

      Henderson,
        Nevada 89052

      (702)
        328-9190

      


      16.  Entire
        Agreement: This Agreement contains the entire
        agreement of the parties relating to the subject matter hereof and supersedes
        any prior agreements with Consumer Direct of America, undertakings, commitments
        and practices relating to Executive" employment by the Company.

      


      17.  Amendments: No
        amendment or modification of the terms of this Agreement shall be valid unless
        made in writing and duly executed by both parties.

      


      18.  Waiver: No
        failure on the part of any party to exercise or delay in exercising any right
        hereunder shall be deemed a waiver thereof or of any other right, nor shall
        any
        single or partial exercise preclude any further or other exercise of such
        right
        or any other right.

      


      19.  Governing
        Law: This Agreement, and the legal relations
        between the parties, shall be governed by and construed in accordance with
        the
        laws of the State of Nevada without regard to conflicts of law doctrines,
        and
        any court action arising out of this Agreement shall be brought in any court
        of
        competent jurisdiction within the State of Nevada.


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      20.  Arbitration: Executive
        may, if he desires, submit any claim for payment under this Agreement or
        any
        dispute regarding the interpretation of this Agreement to arbitration. This
        right to select arbitration shall be solely that of Executive, and Executive
        may
        decide whether or not to arbitrate in his discretion. The "right to select
        arbitration" does not impose on Executive a requirement to submit a dispute
        for
        arbitration. Executive may, in lieu of arbitration, bring an action in
        appropriate civil court. Executive retains the right to select arbitration,
        even
        if a civil action (including, without limitation, an action for declamatory
        relief) if brought by the Company prior to the commencement of arbitration.
        If
        arbitration is selected by Executive after a civil action concerning Executive's
        dispute has been brought by a person other than Executive, the Company and
        Executive shall take such actions as are necessary or appropriate, including
        dismissal of the civil action, so that the arbitration can be timely heard.
        Once
        arbitration is commenced, it may not be discontinued without the unanimous
        consent of all parties to the arbitration.

      


      Any
        Claim for arbitration may be submitted as follows: If Executive disagrees
        with
        an interpretation of this Agreement by the Company, or disagrees with the
        calculation of his benefits under this Agreement, such claim may be filed
        in
        writing with an arbitrator of Executive's choice who is selected by the method
        described in the next four sentences. The first step of the selection shall
        consist of Executive submitting in writing a list of five potential arbitrators
        to the Company. Each of the five arbitrators must be either (1) a member
        of the
        National Academy of Arbitrators located in the state of Executive's principal
        residence or (2) a retired California Superior Court or Appellate Court judge.
        Within one week after receipt of the list, the Company shall select one of
        the
        five arbitrators as the arbitrator of the dispute in question. If the Company
        fails to select an arbitrator in a timely manner, Executive then shall designate
        one of the five arbitrators as the arbitrator of the dispute in
        question.

      


      The
        arbitration hearing shall be held within seven days (or as soon thereafter
        as
        possible) after the selection of the arbitrator. No continuance of said hearing
        shall be allowed without the mutual consent of Executive and the Company.
        Absence from or non-participation at the hearing by any party shall not prevent
        the issuance of an award. Hearing procedures that will expedite the hearing
        may
        be ordered at the arbitrator's discretion, and the arbitrator may close the
        hearing in his sole discretion when he decides he has heard sufficient evidence
        to justify issuance of an award.

      


      The
        arbitrator's award shall be rendered as expeditiously as possible and in
        no
        event later than one week after the close of the hearing. In the event the
        arbitrator finds that Executive is entitled to the benefits he claimed, the
        arbitrator shall order the Company to pay such benefits, in the amounts and
        at
        such time as the arbitrator determines. The award of the arbitrator shall
        be
        final and binding on the parties. The Company shall thereupon pay Executive
        immediately the amount that the arbitrator orders to be paid in the manner
        described in the award. The award may be enforced in any appropriate court
        as
        soon as possible after its rendition. If any action is brought to confirm
        the
        award, no appeal shall be taken by any party from any decision rendered in
        such
        action.


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      If
        the arbitrator determines either that Executive is entitled to the claimed
        benefits or that the claim by Executive was made in good faith, the arbitrator
        shall direct the Company to pay to Executive, and the Company agrees to pay
        to
        Executive in accordance with such order, an amount equal to Executive's expenses
        in pursuing the claim, including attorneys' fees.

      


      21.  Withholding: All
        compensation payable hereunder, including salary and other benefits, shall
        be
        subject to applicable taxes, withholding and other required, normal or elected
        employee deductions.

      


      22.  Counterparts: This
        Agreement and any amendment hereto may be executed in one or more counterparts.
        All of such counterparts shall constitute one and the same agreement and
        shall
        become effective when a copy signed by each party has been delivered to the
        other party.

      


      23.  Headings: Section
        and other headings contained in this Agreement are for convenience of reference
        only and shall not affect in any way the meaning or interpretation of this
        Agreement.

      


      24.  Representation
        By Counsel; Interpretation: The Company and
        Executive each acknowledges that each party to this Agreement has been
        represented by counsel in connection with this Agreement and the matters
        contemplated by this Agreement. Accordingly, any rule of law, including but
        not
        limited to Section 1654 of the California civil Code, or any legal decision
        that
        would require interpretation of any claimed ambiguities in this Agreement
        against the party that drafted it has no application and is expressly waived.
        The provision of this Agreement shall be interpreted in a reasonable manner
        to
        effect the intent of the parties.

      


      25.  Right
        to Purchase Additional Securities:

       

      First
        Refusal Right: If the Company proposes to issue (a "Proposed Issuance")
        Additional Securities (as defined below), the Company shall offer such
        Additional Securities to Executive, and Executive shall have the right (a
        "First
        Refusal Right") to purchase all or any portion of his Pro Rata Share (as
        defined
        below) of such Additional Securities, upon the terms of the Proposed Issuance.
        The Company shall give Executive written notice of the Proposed Issuance
        stating
        the material terms thereof, including the type of Additional Securities
        involved, the proposed purchase price therefor and the anticipated closing
        date
        of such issuance (the "Company Notice"). If Executive desires to exercise
        his
        First Refusal Right, Executive shall, within 20 days of receipt of the Company
        Notice, deliver to the Company written notice stating the portion of Executive's
        Pro Rata Share of such Additional Securities that he is will to purchase
        (a
        "Response Notice"). Executive's Response Notice shall be deemed to constitute
        his irrevocable agreement to purchase the specified portion of his Pro Rata
        Share of the Additional Securities upon the terms of the Proposed Issuance
        described in the Company Notice, on the later of


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (i)    the
        closing
        date specified in the Company Notice or

      (ii)    the
        closing
        date of the Proposed Issuance if other persons are purchasing Additional
        Securities. The Company shall have 90 days from the date of the Company Notice
        to consummate such Proposed Issuance with respect to the Additional Securities
        which are not being purchased by Executive at a price and upon terms that
        are
        not materially less favorable to the Company than the price and terms specified
        in the Company Notice, and such price and terms shall be made available to
        Executive if Executive has elected to purchase Additional Securities. If
        the
        Company proposes to issue Additional Securities after such 90-day period,
        or at
        a price and upon terms, which are materially less favorable to the Company
        than
        those specified in the Company Notice, it must again comply with the procedures
        set forth in this section.

      


      Further
        Rights. If between the date of the Agreement and the effective time the
        outstanding shares of the common stock of Shearson Home Loans have been changed
        into a different number of shares or a different class, reason of any stock
        dividend, subdivision, reclassification, re-capital split, conversion,
        consolidation, combination or exchange of shares or similar transaction,
        appropriate adjustments to reflect any such action shall be made to the subject
        agreement and the employee shall be entitled to an proportionate adjustment
        of
        shares being held.

      


      Termination:
        The rights provided to Executive under this Section 25 shall not be assignable
        by Executive and shall terminate upon the earlier of

      
        	
                 

              	
                (i)

              	
                the
                  termination of this Agreement or

              


      

      
        	
                 

              	
                (ii)

              	
                the
                  consummation of the initial public offering of the Company's Common
                  Stock.

              


      

      


      Definitions:
        (i) "Additional Securities" means (x) all securities of the Company which
        possess general voting power to elect members of the Board of Directors of
        the
        Company ("Voting Securities"), (y) all rights, options or warrants to purchase
        Voting Securities or securities described in the following clause and (z)
        all
        other securities of any type whatsoever that are, or may become, convertible
        into or exchangeable for, or that entitle the holder to purchase, Voting
        Securities (such securities described in clauses (x), (y), and (z) referred
        to
        collectively as "Securities". "Additional Securities" does not include (A)
        all
        shares of stock of the Company issued and outstanding on the date hereof
        (appropriately adjusted in the future to reflect any subsequent stock dividends,
        stock splits, reverse stock splits or similar transactions), (13) any Securities
        issued on a proportional basis to all of the holders of the Company's Common
        Stock, (C) any Securities issued or issuable or reissued or re-issuable to
        any
        employee, consultant or independent member of the Board of the Company or
        any
        subsidiary of the Company pursuant to any employee benefit plan, arrangement
        or
        agreement approved by the Board, (D) any Securities issued or issuable in
        connection with an underwritten public offering of Voting Securities, (E)
        any
        Securities issued or issuable in connection with the acquisition by the Company
        of any business, business assets or Securities from any person, (F) any
        Securities issued to any financing source for the Company or any subsidiary
        of
        the Company in connection with such financing or (G) any Securities that
        are
        issued or issuable upon the exercise of rights, options or warrants to purchase
        Securities or upon the conversion or exchange of Securities convertible into
        or
        exchangeable for Securities where Executive received (or was not required
        to
        receive) a Company Notice pursuant to this agreement.


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (ii)"Pro
        Rata Share" means the fraction (y) the numerator of which is the total number
        of
        shares of Voting Securities then held by Executive and (z) the denominator
        of
        which is the total number of shares of Voting Securities then
        outstanding.

      


      IN
        WITNESS WHEREOF, the parties have executed this Agreement as of the date
        first
        above written.

      


      
        	 	
                    THE
                  COMPANY

              
	 	 
	 	
                Shearson
                  Financial Network, Inc.

              
	 	 
	 	
                /s/  Joseph
                  Cosio-Barron

              
	 	
                Joseph
                  Cosio-Barron

              
	 	
                President

              
	 	 
	 	
                Executive

              
	 	 
	 	 
	 	
                /s/  Michael
                  A. Barron

              
	 	
                Michael
                  A. Barron