Option Agreement with Larry Mosley


    
      

    
Exhibit 10.20

    DATA
      CALL TECHNOLOGIES, INC.

    


    OPTION
      AGREEMENT

    
Date:
      January 29, 2007 

    


    To
      Whom
      It May Concern:

    


    DATA
      CALL TECHNOLOGIES, INC.
      (the
“Company”), for value received, hereby agrees to issue common stock purchase
      options entitling Larry
      Mosley,
      or
      his
      assigns (“Holder”
      or “Option Holder”) to purchase an aggregate of 500,000 shares of the Company’s
      common stock (“Common Stock”). Such option is evidenced by a option certificate
      in the form attached hereto as Schedule 1 (such instrument being hereinafter
      referred to as a “Option,” and such Option and all instruments hereafter issued
      in replacement, substitution, combination or subdivision thereof being
      hereinafter collectively referred to as the “Option”). The Option is issued to
      Holder in consideration for services rendered to the Company as the Company’s
      Chief Financial Officer and Director. The number of shares of Common Stock
      purchasable upon exercise of the Option is subject to adjustment as provided
      in
      Section 5 below. The Option will be exercisable by the Option Holder (as defined
      below) as to all or any lesser number of shares of Common Stock covered thereby,
      at an initial purchase price of US $0.10 per share (the “Purchase Price”),
      subject to adjustment as provided in Section 5 below, for the exercise period
      defined in Section 3(a) below. This option evidences the grant of this Option
      by
      the Company’s Board of Directors on January 17, 2007, and as such, the effective
      date of this Option shall be January 17, 2007 (the “Effective Date”).


    


    
      	 	
              1.

            	
              Representations
                and Warranties.

            


    

    


    The
      Company represents and warrants to you as follows:

    


    Corporate
      and Other Action.
      The
      Company has all requisite power and authority (corporate and other), and has
      taken all necessary corporate action, to authorize, execute, deliver and perform
      this Option Agreement, to execute, issue, sell and deliver the Option and a
      certificate or certificates evidencing the Option, to authorize and reserve
      for
      issue and, upon payment from time to time of the Purchase Price, to issue,
      sell
      and deliver, the shares of the Common Stock issuable upon exercise of the Option
      (“Shares”), and to perform all of its obligations under this Option Agreement
      and the Option. The Shares, when issued in accordance with this Option
      Agreement, will be duly authorized and validly issued and outstanding, fully
      paid and nonassessable and free of all liens, claims, encumbrances and
      preemptive rights. This Option Agreement and, when issued, each Option issued
      pursuant hereto, has been or will be duly executed and delivered by the Company
      and is or will be a legal, valid and binding agreement of the Company,
      enforceable in accordance with its terms. No authorization, approval, consent
      or
      other order of any governmental entity, regulatory authority or other third
      party is required for such authorization, execution, delivery, performance,
      issue or sale.

     


    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	
              (a)

            	
              No
                Violation.
                The execution and delivery of this Option Agreement, the consummation
                of
                the transactions herein contemplated and the compliance with the
                terms and
                provisions of this Option Agreement and of the Option will not conflict
                with, or result in a breach of, or constitute a default or an event
                permitting acceleration under, any statute, the Articles of Incorporation
                or Bylaws of the Company or any indenture, mortgage, deed of trust,
                note,
                bank loan, credit agreement, franchise, license, lease, permit, or
                any
                other agreement, understanding, instrument, judgment, decree, order,
                statute, rule or regulation to which the Company is a party or by
                which it
                is bound.

            


    

    


    
      	 	
              2.

            	
              Transfer.

            


    

    


    
      	
              (a)

            	
              Transferability
                of Option.
                The Option Holder agrees that the Option is being acquired as an
                investment and not with a view to distribution thereof and that;
                the
                Option may not be transferred, sold, assigned or hypothecated except
                as
                provided herein. The Option Holder further acknowledges that the
                Option
                may not be transferred, sold, assigned or hypothecated unless pursuant
                to
                a registration statement that has become effective under the Securities
                Act of 1933, as amended (the “Act”), setting forth the terms of such
                offering and other pertinent data with respect thereto, or unless
                the
                Option Holder has provided the Company with an acceptable opinion
                from
                acceptable counsel that such registration is not required. Certificates
                representing the Option shall bear an appropriate legend. Notwithstanding
                the foregoing, any request to transfer the Option must be accompanied
                by
                the Form of Assignment and Transfer attached hereto as Schedule 2
                executed
                by the Option Holder.

            
	 	 
	
              (b)

            	
              Registration
                of Shares.
                You agree not to make any sale or other disposition of the Shares
                except
                pursuant to a registration statement which has become effective under
                the
                Act, setting forth the terms of such offering, the underwriting discount
                and commissions and any other pertinent data with respect thereto,
                unless
                you have provided the Company with an acceptable opinion of counsel
                acceptable to the Company that such registration is not required.
                Certificates representing the Shares, which are not registered as
                provided
                in this Section 2, shall bear an appropriate legend and be subject
                to a
                “stop-transfer” order.

            


    

    


    
      	 	
              3.

            	
              Exercise
                of Option, Partial Exercise.

            


    

    


    
      	
              (a)

            	
              Exercise
                Period.
                This Option shall expire and all rights hereunder shall be extinguished
                three (3) years from the Effective
                Date.

            


    

    


    
      	
              (b)

            	
              Exercise
                in Full.
                Subject to Section 3(a), a Option may be exercised in full by the
                Option
                Holder by surrender of the Option, with the Form of Subscription
                attached
                hereto as Schedule 3 executed by such Option Holder, to the Company,
                accompanied by payment as determined by 3(d) below, in the amount
                obtained
                by multiplying the number 
                of
                  Shares represented by the respective Option by the Purchase Price
                  per
                  share (after giving effect to any adjustments as provided in Section
                  5
                  below).

              

            
	 	
               

            


    

    


    
      	
              (c)

            	
              Partial
                Exercise.
                Subject to Section 3(a), each Option may be exercised in part by
                the
                Option Holder by surrender of the Option, with the Form of Subscription
                attached hereto as Schedule 3 at the end thereof duly executed by
                such
                Option Holder, in the manner and at the place provided in Section
                3(b)
                above, accompanied by payment as determined by 3(d) below, in amount
                obtained by multiplying the number of Shares designated by the Option
                Holder in the Form of Subscription attached hereto as Schedule 3
                to the
                Option by the Purchase Price per share (after giving effect to any
                adjustments as provided in Section 5 below). Upon any such partial
                exercise, the Company at its expense will forthwith issue and deliver
                to
                or upon the order of the Option Holder a new Option of like tenor,
                in the
                name of the Option Holder subject to Section 2(a), calling in the
                aggregate for the purchase of the number of Shares equal to the number
                of
                such Shares called for on the face of the respective Option (after
                giving
                effect to any adjustment herein as provided in Section 5 below) minus
                the
                number of such Shares designated by the Option Holder in the
                aforementioned form of
                subscription.

            


    

    


    
      	
              (d)

            	
              Payment
                of Purchase Price.
                The Purchase Price may be made by any of the following or a combination
                thereof, at the election of the Option Holder:


            


    

     

    
      	
              (i)    

            	
               In
                cash; by wire transfer; by certified or cashier’s check, or money order;
                or

            
	 	 
	
              (ii)   

            	
               By
                delivery to the Company of an exercise notice that requests the Company
                to
                issue to the Option Holder the
                full number of shares as to which the Option is then
                exercisable, less the number of shares that have
                an aggregate Fair Market Value, as determined by the Board in
                itssole discretion at the time of exercise, equal to the
                aggregate purchase price of the shares to which such exercise
                relates.  (This method of exercise allows the Option Holder to
                use a portion of the shares issuable at the time of exercise as
                payment for the shares to which the Option relates and is often referred
                to as a "cashless exercise." For example, if the Option Holder elects
                to
                exercise 1,000 shares at an exercise price of $0.25 and the
                current Fair Market Value of the shares on the date of exercise is
                $1.00, the Option Holder can use 250 of the 1,000 shares at $1.00 per
                share to pay for the exercise of the entire Option (250 x $1.00
                = $250.00) and receive only the remaining 750 shares). 

            
	 	 


    

     

    For
      purposes of this section, "Fair Market Value” shall be defined as the average
      closing price of the Common Stock (if actual sales price information on any
      trading day is not available, the closing bid price shall be used) for the
      five
      trading days prior to the date of exercise of this Option (the “Average Closing
      Bid Price”), as reported by the National Association of Securities Dealers
      Automated Quotation System (“NASDAQ”), or if the Common Stock is not traded on
      NASDAQ, the Average Closing Bid Price in the over-the-counter market; provided,
      however, that if the Common Stock is listed on a stock exchange, the Fair Market
      Value shall be the Average Closing Bid Price on such exchange; and, provided
      further, that if the Common Stock is not quoted or listed by any organization,
      the fair value of the Common Stock, as determined by the Board of Directors
      of
      the Company, whose determination shall be conclusive, shall be used).  In
      no event shall the Fair Market Value of any share of Common Stock be less than
      its par value.

     


    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


     

     

     

    
      	 	
              4.

            	
              Delivery
                of Stock Certificates on Exercise.

            


    

    


    Any
      exercise of the Option pursuant to Section 3 shall be deemed to have been
      effected immediately prior to the close of business on the date on which the
      Option together with the Form of Subscription and the payment for the aggregate
      Purchase Price shall have been received by the Company. At such time, the person
      or persons in whose name or names any certificate or certificates representing
      the Shares or Other Securities (as defined below) shall be issuable upon such
      exercise shall be deemed to have become the holder or holders of record of
      the
      Shares or Other Securities so purchased. As soon as practicable after the
      exercise of any Option in full or in part, and in any event within Ten (10)
      business days thereafter, the Company at its expense (including the payment
      by
      it of any applicable issue taxes) will cause to be issued in the name of, and
      delivered to the purchasing Option Holder, a certificate or certificates
      representing the number of fully paid and nonassessable shares of Common Stock
      or Other Securities to which such Option Holder shall be entitled upon such
      exercise, plus in lieu of any fractional share to which such Option Holder
      would
      otherwise be entitled, cash in an amount determined pursuant to Section 5(e).
      The term “Other Securities” refers to any stock (other than Common Stock), other
      securities or assets (including cash) of the Company or any other person
      (corporate or otherwise) which the Option Holder at any time shall be entitled
      to receive, or shall have received, upon the exercise of the Option, in lieu
      of
      or in addition to Common Stock, or which at any time shall be issuable or shall
      have been issued in exchange for or in replacement of Common Stock or Other
      Securities pursuant to Section 5 below or otherwise.

    


    
      	 	
              5.

            	
              Adjustment
                of Purchase Price and Number of Shares
                Purchasable.

            


    

    


    The
      Purchase Price and the number of Shares are subject to adjustment from time
      to
      time as set forth in this Section 5.

    


     

    
      	
              (a)

            	
              In
                case the Company shall at any time after the date of this Option
                Agreement
                (i) declare a dividend on the Common Stock in shares of its capital
                stock,
                (ii) subdivide the outstanding Common Stock, (iii) combine the outstanding
                Common Stock into a smaller number of Common Stock, or (iv) issue
                any
                shares of its capital stock by reclassification of the Common Stock
                (including any such reclassification in connection with a consolidation
                or
                merger in which the Company is the continuing corporation), then
                in each
                case the Purchase Price, and the number and kind of Shares receivable
                upon
                exercise, in effect at the time of the record date for such dividend
                or of
                the effective date of such subdivision, combination, or reclassification
                shall be proportionately adjusted so that the holder of any Option
                exercised after such time shall be entitled to receive the aggregate
                number and kind of Shares which, if such Option had been exercised
                immediately prior to such record date, he would have owned upon such
                exercise and been entitled to receive by virtue of such dividend,
                subdivision, combination, or reclassification. Such adjustment shall
                be
                made successively whenever any event listed above shall
                occur.

            
	 	 


    

    


    
      	
              (b)

            	
              No
                adjustment in the Purchase Price shall be required if such adjustment
                is
                less than US $0.01; provided,
                however,
                that any adjustments which by reason of this subsection (b) are not
                required to be made shall be carried forward and taken into account
                in any
                subsequent adjustment. All calculations under this Section 5 shall
                be made
                to the nearest cent or to the nearest one-thousandth of a share,
                as the
                case may be.

            
	 	 
	
              (c)

            	
              Upon
                each adjustment of the Purchase Price as a result of the calculations
                made
                in subsection (a) of this Section 5, the Option outstanding prior
                to the
                making of the adjustment in the Purchase Price shall thereafter evidence
                the right to purchase, at the adjusted Purchase Price, that number
                of
                Shares (calculated to the nearest thousandth) obtained by (i) multiplying
                the number of Shares purchasable upon exercise of the Option immediately
                prior to adjustment of the number of Shares by the Purchase Price
                in
                effect prior to adjustment of the Purchase Price and (ii) dividing
                the
                product so obtained by the Purchase Price in effect immediately after
                such
                adjustment of the Purchase Price.

            


    

    


    
      	 	
              6.

            	
              Further
                Covenants of the Company.

            


    

    


    
      	 	
              (a)

            	
              Dilution
                or Impairments.
                The Company will not, by amendment of its certificate of incorporation
                or
                through any reorganization, transfer of assets, consolidation, merger
                or
                dissolution, avoid or seek to avoid the observance or performance
                of any
                of the terms of the Option or of this Option Agreement, but will
                at all
                times in good faith assist in the carrying out of all such terms
                and in
                the taking of all such action as may be necessary or appropriate
                in order
                to protect the rights of the Option Holder against dilution or other
                impairment. Without limiting the generality of the foregoing, the
                Company:

            


    

    


    
      	
              (i)

            	
              shall
                at all times reserve and keep available, solely for issuance and
                delivery
                upon the exercise of the Option, all shares of Common Stock (or Other
                Securities) from time to time issuable upon the exercise of the Option
                and
                shall take all necessary actions to ensure that the par value per
                share,
                if any, of the Common Stock (or Other Securities) is at all times
                equal to
                or less than the then effective Purchase Price per share;
                and

            


    

     

    
 

    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	
              (ii)

            	
              will
                take all such action as may be necessary or appropriate in order
                that the
                Company may validly and legally issue fully paid and nonassessable
                shares
                of Common Stock or Other Securities upon the exercise of the Option
                from
                time to time outstanding.

            


    

    


    
      	
              (b)

            	
              Title
                to Stock.
                All Shares delivered upon the exercise of the Option shall be validly
                issued, fully paid and nonassessable; each Option Holder shall, upon
                such
                delivery, receive good and marketable title to the Shares, free and
                clear
                of all voting and other trust arrangements, liens, encumbrances,
                equities
                and claims whatsoever; and the Company shall have paid all taxes,
                if any,
                in respect of the issuance thereof.

            
	 	 
	
              (c)

            	
              Exchange
                of Option.
                Subject to Section 2(a) hereof, upon surrender for exchange of any
                Option
                to the Company, the Company at its expense will promptly issue and
                deliver
                to or upon the order of the holder thereof a new Option or like tenor,
                in
                the name of such holder, calling in the aggregate for the purchase
                of the
                number of Shares called for on the face of the Option surrendered.
                The
                Option and all rights thereunder are not transferable in whole or
                in part
                upon the books of the Company.

            
	 	 
	
              (d)

            	
              Replacement
                of Option.
                Upon receipt of evidence reasonably satisfactory to the Company of
                the
                loss, theft, destruction or mutilation of any Option and, in the
                case of
                any such loss, theft or destruction, upon delivery of an indemnity
                agreement reasonably satisfactory in form and amount to the Company
                or, in
                the case of any such mutilation, upon surrender and cancellation
                of such
                Option, the Company, at the expense of the Option Holder, will execute
                and
                deliver, in lieu thereof, a new Option of like tenor.

            
	 	 
	
              (e)

            	
              Fractional
                Shares.
                No fractional Shares are to be issued upon the exercise of any Option,
                but
                the Company shall round any fraction of a share to the nearest whole
                Share.

            


    

    


    
      	 	
              7.

            	
              Miscellaneous.

            


    

    


    All
      notices, certificates and other communications from or at the request of the
      Company to any Option Holder shall be mailed by first class, registered or
      certified mail, postage prepaid, to such address as may have been furnished
      to
      the Company in writing by such Option Holder, or, until an address is so
      furnished, to the address of the last holder of such Option who has so furnished
      an address to the Company, except as otherwise provided herein. This Option
      Agreement and any of the terms hereof may be changed, waived, discharged or
      terminated only by an instrument in writing signed by the party against which
      enforcement of such change, waiver, discharge or termination is sought. This
      Option Agreement shall be construed and enforced in accordance with and governed
      by the laws of the State of Texas. The headings in this Option Agreement are
      for
      purposes of reference only and shall not limit or otherwise affect any of the
      terms hereof. This Option Agreement, together with the forms of instruments
      annexed hereto as schedules, constitutes the full and complete agreement of
      the
      parties hereto with respect to the subject matter hereof. For purposes of this
      Option Agreement, a faxed signature shall constitute an original
      signature.

     


    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    
 

    IN
      WITNESS WHEREOF, the Company has caused this Option Agreement to be executed
      on
      this 29th day of January 2007, to be effective as of January 17, 2007, in
      Houston, Texas, by its proper corporate officers, thereunto duly
      authorized.

    


    


    DATA
      CALL TECHNOLOGIES, INC.

    


    


    By
      /s/
      James Ammons

        
      James Ammons, 

         Chief
      Executive Officer

     


    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    SCHEDULE 1

    


    OPTION

    


    THIS
      OPTION AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE HAVE NOT BEEN
      REGISTERED UNDER: (A) THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), IN
      RELIANCE UPON THE EXEMPTIONS FROM REGISTRATION PROVIDED IN SECTIONS 3 AND 4
      OF
      SUCH ACT AND REGULATION S PROMULGATED THEREUNDER; OR (B) ANY STATE SECURITIES
      LAWS IN RELIANCE UPON APPLICABLE EXEMPTIONS THEREUNDER. THIS OPTION MAY NOT
      BE
      EXERCISED BY OR ON BEHALF OF ANY U.S. PERSON UNLESS REGISTERED UNDER THE ACT
      OR
      AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. THIS OPTION MUST BE ACQUIRED
      FOR INVESTMENT ONLY FOR THE ACCOUNT OF THE INVESTOR, AND NEITHER THE OPTION
      NOR
      THE UNDERLYING STOCK MAY BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE PROVISIONS
      OF REGULATION S AND OTHER LAWS OR PURSUANT TO REGISTRATION UNDER THE ACT OR
      AN
      AVAILABLE EXEMPTION FROM REGISTRATION. HEDGING TRANSACTIONS INVOLVING THIS
      OPTION OR THE SECURITIES TO BE ISSUED UPON ITS EXERCISE MAY NOT BE CONDUCTED
      UNLESS IN COMPLIANCE WITH THE ACT.

    


     

    To
      Purchase 500,000 Shares

    of
      Common
      Stock

    DATA
      CALL TECHNOLOGIES, INC.

    


    


    This
      certifies that, for value received, the hereafter named registered owner is
      entitled, subject to the terms and conditions of this Option, until the
      expiration date, to purchase the number of shares (the “Shares”) set forth above
      of the common stock (“Common Stock”), of DATA CALL TECHNOLOGIES, INC. (the
“Company”) from the Company at the purchase price per share hereafter set forth
      below, on delivery of this Option to the Company with the exercise form duly
      executed and payment of the purchase price (in cash or by certified or bank
      cashier’s check payable to the order of the Company) for each Share purchased.
      This Option is subject to the terms of the Option Agreement between the parties
      thereto dated as of January 29, 2007, the terms of which are hereby incorporated
      herein. Reference is hereby made to such Option Agreement for a further
      statement of the rights of the holder of this Option, including, but not limited
      to the expiration dates of this Option as described in Section 3 of the Option
      Agreement.

    


    Registered
      Owner: Larry
      Mosley   Date:
      January
      29, 2007, to be effective January 17, 2007  

    


    Purchase
      Price

    Per
      Share:  US
      $0.10

    


    Expiration
      Date:  January
      17, 2010, 5:00 p.m. Central Standard Time.

    


    WITNESS
      the signature of the Company’s authorized officer:

    


    DATA
      CALL TECHNOLOGIES, INC.

    


    


    


    By
      /s/
      James Ammons

                                                                                                      
       
      James
      Ammons, Chief Executive Officer

     


    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    SCHEDULE 2

    


    FORM
      OF ASSIGNMENT AND TRANSFER

    


    


    For
      value
      received, the undersigned hereby sells, assigns and transfers unto
      __________________________________ the right represented by the enclosed Option
      to purchase _________________ shares of Common Stock of DATA CALL TECHNOLOGIES,
      INC. to which the enclosed Option relates, and
      appoints ________________
      Attorney
      to transfer such right on the books of DATA CALL TECHNOLOGIES, INC. with full
      power of substitution in the premises.

    


    The
      undersigned represents and warrants that the transfer of the enclosed Option
      is
      permitted by the terms of the Option Agreement pursuant to which the enclosed
      Option has been issued, and the transferee hereof, by his, her or its acceptance
      of this Agreement, represents and warrants that he, she or it is familiar with
      the terms of said Option Agreement and agrees to be bound by the terms thereof
      with the same force and effect as if a signatory thereto.

    


    Dated:______________

    


    


    ____________________________________________

    (Signature
      must conform in all respects to name of holder

    as
      specified on the face of the enclosed Option)

     

    ____________________________________________

    (Printed
      Name)

    


    ____________________________________________

    (Address)

    


    Signed
      in
      the presence of:

    


    ____________________________________

     


    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


                SCHEDULE
      3

    FORM
      OF SUBSCRIPTION

                                             
      (To
      be
      signed only upon exercise of Option)

    


    


    To
      DATA
      CALL TECHNOLOGIES, INC.:

    


    The
      undersigned, the holder of the enclosed Option, hereby irrevocably elects to
      exercise the purchase right represented by such Option for, and to purchase
      thereunder, _________________*
      shares
      of Common Stock of DATA CALL TECHNOLOGIES, INC. and herewith makes payment
      of US
      $_______________(or elects to pay for the exercise in shares of common stock
      pursuant to Section 3(d)(ii) of the Option Agreement as evidenced by the
      calculation below by checking this box o),
      and
      requests that the certificate or certificates for such shares be issued in
      the
      name of and delivered to the undersigned.

    


    Dated:______________

    ____________________________________________

    (Signature
      must conform in all respects to name of holder

    as
      specified on the face of the enclosed Option)

    


    ____________________________________________

    (Printed
      Name)

    


    ____________________________________________

    (Address)

    


    
      	
              (*)

            	
              Insert
                here the number of shares called for on the face of the Option or,
                in the
                case of a partial exercise, the portion thereof as to which the Option
                is
                being exercised, in either case without making any adjustment for
                additional Common Stock or any other stock or other securities or
                property
                which, pursuant to the adjustment provisions of the Option Agreement
                pursuant to which the Option was granted, may be delivered upon
                exercise.

            


    

    


    


    Calculation
      pursuant to Section 3(d)(ii) of the Option Agreement

    


    ________________
      = Total
      Shares Exercised 

    


    ________________
      = Purchase
      Price (as
      defined and adjusted in the Option Agreement)

    


    ________________
      = Fair
      Market Value
      -
the
      average closing price of the Common Stock (if actual sales price information
      on
      any trading day is not available, the closing bid price shall be used) for
      the
      five trading days prior to the date of exercise of this Option (the “Average
      Closing Bid Price”), as reported by the National Association of Securities
      Dealers Automated Quotation System (“NASDAQ”), or if the Common Stock is not
      traded on NASDAQ, the Average Closing Bid Price in the over-the-counter market;
      provided, however, that if the Common Stock is listed on a stock exchange,
      the
      Fair Market Value shall be the Average Closing Bid Price on such exchange;
      and,
      provided further, that if the Common Stock is not quoted or listed by any
      organization, the fair value of the Common Stock, as determined by the Board
      of
      Directors of the Company, whose determination shall be conclusive, shall be
      used).  In no event shall the Fair Market Value of any share of Common
      Stock be less than its par value.

      

    


    


             Total
      Shares Exercised x Purchase Price

    _______________
      =   Shares to be Issued  =  Total Shares
      Exercised        
 -------------------------------------------------- 

    Fair
      Market Value