Document:

f8k092208ex10_artcraftv.htm

    

     

    EXHIBIT10.1

    
 

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    TOP
INTEREST INTERNATIONAL LIMITED.

    

    AND

    

    SHENZHEN
DINGYI INVESTMENT CONSULTING COMPANY CO., LTD

    

    ----------

    

    Agreement
on Transfer of Shares of SHENZHEN XIN KAI YUAN INFO CONSULT
CO.,LTD.

    

    ----------

    

    

    SEPTEMBER
22, 2008

    

    

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    Party A:
TOP INTEREST INTERNATIONAL LIMITED.

    

    Registration
Number: 535643

    

    Registration
address: 16th FL,
Office Tower, Convention Plaza, 1 Harbour Rd, Hong Kong

    

    (Here in
after the "Transferor")

    

    

    Party B:
SHENZHEN DINGYI INVESTMENT CONSULTING COMPANY CO., LTD

    

    Registration
Number: 440301103034433

    

    Registered
address: Room A01-2, 15th FL, An
Lian Tower, 4018 Jin Tian Rd, Shenzhen, China

    

    (Here in after
the "Transferee")

    

    

    WHEREAS:

    

         1.
SHENZHEN XIN KAI YUAN INFO CONSULT CO., LTD (hereinafter "Xin Kai Yuan") is
an information search platform that is engaged in the business of providing
information search engine, online web application and image designing service.
It is legally established on February 24th, 2004
and validly existing under Chinese laws. Its registered capital is RMB
$1,000,000. The transferor Top Interest International Limited owns 70% of Xin
Kai Yuan’s total equity interest; Lian Haibin owns 20% of Xin Kai Yuan’s total
equity interest; Liu Yi Ming owns 10% of its total equity interest.

    

         2.
The Transferee is a legal entity legally established and validly existing
under the laws of PRC. It desires to accept all shares of Xin Kai Yuan held by
the Transferor.

    

         In
consideration of the foregoing share transfer, the parties hereby agree as
follows through friendly consultation in accordance with relevant laws
and regulations and in the spirit of mutual benefit, honesty and good
faith:

    

    I. Share
Transfer

    

         1.
The Transferor agrees to transfer all of its shares of  Xin Kai Yuan
to the Transferee on the Transfer Effective Date (as defined
hereinafter) provided under Article III of this Agreement according to
terms and conditions of this Agreement. The Transferee agrees to
accept such shares according to terms and conditions of this Agreement
(hereinafter "Share Transfer Agreement").

    

         2.
Unless otherwise provided under this Agreement, the Transferee shall become
the legal owner of the shares contemplated to be transferred under
this Agreement and have all rights and obligations in respect of Share
Transfer (such rights including all rights, interests and duties in respect
of its contribution), and the Transferor shall not have any right,
obligation or responsibility in respect of Share Transfer, as of the
Transfer Effective Date provided under Article III of this
Agreement.

     

     

    
      
        
        

      

      
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         3.
The parties hereto agree to effect all procedures in respect of
Share Transfer according to the terms and time provided under this
Agreement, including without limitation securing approval documents for
Share Transfer/acceptance according to the laws of their respective
incorporation place.

    

         4.
The Transferor shall transfer to the Transferee any and all materials held
by the Transferor necessary for appropriate exercise of shareholder
rights by the Transferee as of the Share Transfer Effective Date of this
Agreement, including without limitation board resolutions and minutes of
Xin Kai Yuan, all seals of Xin Kai Yuan (including without limitation
corporate seal, finance seal and contract seal), approval documents of Xin
Kai Yuan, approval documents from PRC governmental authorities, business license
(originals and copies), certificates, checkbooks, materials relating to
bank account and changes

    Thereto
property title documents and approvals.

    

    II. Share
Transfer Price and Payment

    

         1.
The parties hereto agree that the price of Share Transfer is RMB $1.00
(hereinafter "Share Transfer Price") and the transferee agrees to take all the
obligations and debt of Xin Kai Yuan in respect of the ownership of equity
interest as of  the Share Transfer Effective date.

    

         2.
The parties hereto agree that the Transferee shall pay to the Transferor RMB
$1.00 by cash upon the Share Transfer Effective date. If Share Transfer fails
to be effective within 90 days after execution of this Agreement by reasons
other than those on the part of the Transferee after the Transferee
effected the payment
to the Transferor, the Transferor shall refund to the Transferee full amount of
the payment at the earlier of: (1) within five working days after the
Transferor is expressly informed that Share Transfer fails to be effective
as scheduled, or (2) 90 days after execution of
this Agreement.

    

    III.
Effective Date of this Agreement and of Share Transfer

    

         1.
This Agreement shall be effective upon execution by the parties hereto or
their respective authorized representatives and affixture of seals.

    

         2.
Share Transfer contemplated under this Agreement shall be effective
upon realization of all conditions precedent set out below, and the date
of realization shall be Share Transfer Effective Date:

    

    
      	
               
      

            	
                      (1)  This
      Agreement is legally executed by the parties hereto or
      their respective authorized
   representatives;

            

    

    

    
      	
               
      

            	
                      (2)  This
      Agreement and the Share Transfer contemplated hereunder are approved
      for  transfer/acceptance by the respective authorities
      of Transferor and Transferee;

            

    

    

    
      	
               
      

            	
                      (3)  This
      Agreement and the Share Transfer contemplated hereunder are approved
      by the original  approval authority, all the filing and
      registration process with the Chinese Administration of Industry and
      Commerce have been completed in accordance with the relevant PRC rules and
      regulations, and approval documents by are
  secured;

            

    

    

    
      	
               
      

            	
                      (4)  Other
      legal documents required for the Share Transfer have been appropriately
      secured and relating procedures or formalities have been validly
      effected.

            

    

    

         3.
The parties hereto shall, in good faith, complete any activities necessary
for effecting the Share Transfer provided hereunder within 90 days after this
Agreement is effective or any time otherwise agreed upon by both parties,
including without limitation executing or causing third party to execute
any document or application, or securing any relevant approval, consent or
permit to effect performance of this Agreement.

     

     

    
      
        
        

      

      
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         4.
The Transferor agrees that the Share Transfer shall not be effective until
all conditions precedent set out in Section 2 of this Article are
realized within agreed-upon time, and the Transferee bears no liability
therefore unless the failure of such realization is caused by the error of
the Transferee. If such condition precedent fails to be realized according
to the terms or within the time provided hereunder due to the error of the
Transferor, the Transferor shall be liable to any losses or expenses thus
incurred by the Transferee; if such condition precedent fails to be
realized according to the terms or within the time provided hereunder due to the
error of the Transferee, the Transferee shall be liable to any losses or
expenses thus incurred by the Transferor.

    

    IV.
Representations, Covenants and Warranties of the Transferor

    

         1.
Xin Kai Yuan is a limited liability company legally established and validly
existing under Chinese laws. The Transferor has duly paid up its subscribed
capital in light of capital percentage and secured corresponding share
rights according to laws. The Transferor has performed all of
its obligations as shareholder in strict compliance with articles of
association of Xin Kai Yuan.

    

         2.
The Transferor has all rights, powers and authorities to enter into
and perform all duties and responsibilities under this Agreement. This
Agreement is legally binding upon the Transferor upon
execution.

     

         3.
The Transferor legally and actually owns the shares intended to
be transferred under this Agreement, and is capable in right and action to
transfer such shares, and has secured all necessary approvals
therefore.

    

         4.
Execution or performance of this Agreement by the Transferor does
not breach laws, articles of association, contracts, agreements or any
other legal documents which the Transferor is subject to.

    

         5.
The shares intended for transfer are complete and have not been
pledged subject to any preferential right or any third party interest, or
have any right defect.

    

         6.
The balance sheet of Xin Kai Yuan and other financial materials
and information provided by the Transferor to the Transferee are complete,
true and accurate. Except for the liabilities (including actual liabilities
and contingent liabilities) disclosed by the Transferor to the
Transferee, Xin Kai Yuan has no other liabilities ("Undisclosed
Liabilities"). If any Undisclosed Liabilities exist, the Transferor shall
be liable for its full repayment. If the Transferee or Xin Kai Yuan suffers any
loss due to Undisclosed Liabilities, the Transferor shall be liable to all
damages therefore.

    

         7.
There exists no breach of law, proceedings or potential proceedings
in respect of tax, accounting, employment, insurance and property of Xin
Kai Yuan.

     

    V.
Representations, Covenants and Warranties of the Transferee

    

         1.
The Transferee is the legal person legally established and validly existing
under the laws of PRC.

    

         2.
The Transferee has full rights to conduct the matters in respect
of accepting shares from the Transferor as provided under this Agreement,
and has secured all approvals and/or authorizations in respect of execution
and performance of this Agreement.

     

     

    
      
        
        

      

      
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         3.
Execution or performance of this Agreement by the Transferee is in
no breach of the laws, articles of association, contracts, agreements or
other legal documents which the Transferee is subject to.

    

         4.
The Transferee shall perform the obligation of paying transfer price to the
Transferor in strict compliance with terms of this Agreement, and
warrant not to withdraw contribution after such payment obligation is
fulfilled and the registration of the company is changed.

    

    VI.
Confidentiality

    

        Unless
expressly required by relevant Chinese laws and regulations, relevant articles
of association, or other applicable laws and regulations, no party shall
disclose the terms of this Agreement to any third party other than the parties
hereto without the prior written consent of the other party before completion of
the transaction.

    

    VII. Fees
and Expenses

    

         1.
The parties hereto agree to bear their respective fees incurred
for engagement of lawyers, accountants, appraisers, financial advisors and
other professionals.

    

         2.
Any taxable liability incurred under the Share Transfer shall be paid by the
Transferor and the Transferee respectively according to PRC laws.

    

         3.
Any other expenses occurred in connection with the Share
Transfer (including without limitation the expenses relating to change
registration at I Chinese Administration of Industry and Commerce bureau) shall
be equally paid by the Transferor and the Transferee.

    

    VIII.
Other Matters relating and Amendment to this Agreement

    

         1.
The parties hereto agree to further negotiate other matters in respect of
this Agreement after execution of this Agreement and enter into
supplemental agreement in writing. Such supplemental agreement constitutes
an integral part of this Agreement.

    

         2.
Any amendment to this Agreement shall be in writing and signed by
both parties. Any amendment or addition shall constitute an integral part
of this Agreement.

    

    IX.
Breach Liability

    

         1.
Any party hereto shall be deemed in breach of this Agreement if
such party:

    

              (1)  fails
to perform any obligation under this Agreement;

    

              (2)  breaches
any of its representation, covenant or warranty made under this Agreement;
or

    

    
                (3)  its
representation or warranty made under this Agreement is inconsistent with
facts or  misleading (in good faith or in
bad faith).

    

    

         2.
Under occurrence of such breach, the non-breaching party has the right to
require the breaching party to correct within 10 days; if the breaching
party fails to correct within the specified time, the non-breaching
party has the right to terminate this Agreement and claim damages from the
breaching party.

     

     

    
      
        
        

      

      
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         3.
The parties hereto covenants to each other that without prejudice to
the right to claim damages by the non-breaching party against the breach
of covenant, warranty or obligation by the breaching party under this
Agreement, the breaching party shall be liable to the following damages as
required by the non-breaching party:

     

    
      	
               
      

            	
                       
      (1)  A certain sum of damages which is sufficient to restore
      both parties to the status as if the  Agreement is not
      breached;

            

    

    

    
      	
               
      

            	
                        (2)  Expenses
      or costs directly or indirectly incurred by the  non-breaching party
      arising out of the breach of the Agreements (including without limitation
      litigation, arbitration and/or lawyer fees reasonably incurred by the
      non-breaching party).

            

    

    

    X.
Dispute Resolution

    

         1.
Any dispute arising out of or relating to this Agreement shall be settled
by the parties hereto through friendly consultation.

    

         2.
If any dispute is not settled through friendly consultation by the parties
hereto within thirty days after its occurrence, such dispute shall
be submitted to the Chinese Court for arbitration according to its rules
then in effect. The award of arbitration is final and binding upon both
parties. The seat of the arbitration is in Shenzhen, China.

    

         3.
If any provision of this Agreement shall be determined to be
invalid according to relevant laws, the remaining of this Agreement shall
continue to be valid and enforceable.

    

    XI.
Applicable Laws

    

         The
execution, validity, interpretation and performance of this Agreement, and
dispute resolution thereof shall be governed by relevant laws of
China.

    

    XII.
Agreement Right

    

         No
party shall assign its rights under this Agreement without prior
written consent of the other party. Respective successors and permitted
assigns of the parties hereto are subject to provisions of this
Agreement.

    

    XIII.
Entire Agreement

    

        This
Agreement constitutes all representations and agreements between the parties
hereto and supersedes all prior oral and written representations, warranties,
understandings and agreements between the parties relating to the subject matter
of this Agreement. The parties hereto agree and acknowledge that any
representation or covenant that is not provided under this Agreement shall not
constitute basis of this Agreement and, therefore, shall not be the basis to
determine respective rights and obligations of the parties or to interpret terms
and conditions of this Agreement.

    

     

    
      
        
        

      

      
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    IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the date first written above.

    

    

    By: /s/                                                                               
     

     

    Party A:
TOP INTEREST INTERNATIONAL LIMITED.

    

    Legal
Representative/Authorized Representative: 

    

    Date:
September 22, 2008

    

     

    By: /s/                                                                                
               

     

    Party B:
SHENZHEN DINGYI INVESTMENT CONSULTING COMPANY CO., LTD

    

    Authorized
Representative:

    

    Date:
September 22, 2008fs1ex9i_ea3feelgolf.htm

     

    EXHIBIT
10.1

     

    Feel
Golf Company, Inc

    

    2003-2004 STOCK OPTION PLAN

    

    ARTICLE
I

    

    Adoption.   
Pursuant to a resolution of the Board of Directors of Feel Golf Company, Inc
(hereinafter the “Company”),as approved by the shareholders of the
Company at a special meeting of the shareholders of the Company on February 5th 2005 , the Company hereby
adopts this 2003-2004 STOCK OPTION PLAN (hereinafter the “Stock
Plan”).

    

    ARTICLE
II

    

    Purposes
of the Plan     
The purposes of this Stock Plan are to attract and retain the best
available personnel for positions of substantial responsibility, to provide
additional incentive to Employees and Consultants of the Company and its
Subsidiaries and to promote the success of the Company’s business. Options
granted under the Plan may be incentive stock options (as defined under Section
422 of the Internal Revenue Code) or non-statutory stock options, as determined
by the Administrator at the time of grant of an option and subject to the
applicable provisions of Section 422 of the Internal Revenue Code, as amended,
and the regulations promulgated thereunder. Stock purchase rights may also be
granted under the Plan.

    

    ARTICLE
III

    

    Definitions
..         As used herein, the
following definitions shall apply:

    

    (a)           Administrator means
the Board or any of its Committees appointed pursuant to Article IV of the
Plan.

    

    (b)           Board means the Board
of Directors of the Company.

    

    (c)           Internal Revenue Code
means the Internal Revenue Service Code of 1986, as amended.

    

    (d)           Committee means a
Committee appointed by the Board of Directors in accordance with Article IV of
the Plan.

    

    (e)           Common Stock means
the Common Stock of the Company.

    

    (f)           Company means Feel
Golf Company, Inc a California corporation.

    

    (g)           Consultant means
any person who is engaged by the Company or any Parent or Subsidiary to render
consulting or advisory services and is compensated for such services, and any
director of the Company whether compensated for such services or not; provided
that if and in the event the Company registers any class of any equity security
pursuant to the Exchange Act, the term Consultant shall thereafter not include
directors who are not compensated for their services or are paid only a
director’s fee by the Company.

     

     

    
      
        
        

      

      
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    (h)           Continuous Status as an
Employee or Consultant means that the employment or consulting
relationship with the Company, any Parent, or Subsidiary, is not interrupted or
terminated.  Continuous Status as an Employee or Consultant shall not
be considered interrupted in the case of (i) any leave of absence approved by
the Company or (ii) transfers between locations of the Company or between the
Company, its Parent, any Subsidiary, or any successor.  A leave of
absence approved by the Company shall include sick leave, military leave, or any
other personal leave approved by an authorized representative of the
Company.  For the purposes of Incentive Stock Options, no such leave
may exceed ninety (90) days, unless reemployment upon expiration of such leave
is guaranteed by statute or contract, including Company policies.  If
reemployment upon expiration of a leave of absence approved by the Company is
not so guaranteed, on the ninety-first (91st) day of such leave any Incentive
Stock Option held by the Optionee shall cease to be treated as an Incentive
Stock Option and shall be treated for tax purposes as a Nonstatutory Stock
Option.

    

    (i)           Employee means any
person, including officers and directors, employed by the Company or any Parent
or Subsidiary of the Company.  The payment of a director's fee by the
Company shall not be sufficient to constitute employment by the
Company.

    

    (j)           Exchange Act means
the Securities Exchange Act of 1934, as amended.

    

    (k)           Fair Market Value
means, as of any date, the value of Common Stock.

    

    (i)           If
the Common Stock listed on any established stock exchange or national market
system, including without limitation the Nasdaq National Market of the National
Association of Securities Dealers, Inc. Automated Quotation (ANASDAQ@)
System, its Fair Market Value shall be the closing sales price for such stock
(or the closing bid, if no sales were reported, as quoted on such exchange or
system for the last market trading day prior to the time of determination) as
reported in The Wall Street
Journal or such other source as the Administrator deems
reliable;

    

    (ii)           If
the Common Stock is quoted on the NASDAQ System (but not on the Nasdaq National
Market thereof) or regularly quoted by a recognized securities dealer but
selling prices are not reported, its Fair Market Value shall be the mean between
the high bid and the low asked prices for the Common Stock on the last market
trading day prior to the day of determination, or;

     

     

    
      
        
        

      

      
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    (iii)           In
the absence of an established market for the Common Stock, the Fair Market Value
thereof shall be determined in good faith by the Administrator.

    

    (l)           Incentive Stock
Option means an Option intended to qualify as an incentive stock option
within the meaning of Section 422 of the Internal Revenue Code.

    

    (m)           Nonstatutory Stock
Option means an Option not intended to qualify as an Incentive Stock
Option.

    

    (n)           Officer means a
person who is an officer of the Company within the meaning of Section 16 of the
Exchange Act and the rules and regulations promulgated thereunder.

    

    (o)           Option means a stock
option granted pursuant to the Plan.

    

    (p)           Optioned Stock means
the Common Stock subject to an Option or a Stock Purchase Right.

    

    (q)           Optionee means an
Employee or Consultant who receives an Option or Stock Purchase
Right.

    

    (r)           Parent means a Aparent
corporation@,
whether now or hereafter existing, as defined in Section 424(e) of the Internal
Revenue Code.

    

    (s)           Plan means this Stock
Plan.

    

    (t)           Restricted Stock
means shares of Common Stock acquired pursuant to a grant of a Stock Purchase
Right herein below.

    

    (u)           Share means a share
of Common Stock, as adjusted in accordance with Article XII below.

    

    (v)           Stock Purchase Right
means a right to purchase Common Stock pursuant to Article XI
below.

    

    (w)           Subsidiary means a
subsidiary corporation, whether now or hereafter existing, as defined in Section
424(f) of the Internal Revenue Code.

    

    3.           Stock Subject to the
Plan.   Subject to the provisions of Article XII of the
Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is Two
(2)  million Shares for Incentive Stock Options and One (1)  million shares
for Nonstatutory Stock Options.  The Shares may be authorized, but
un-issued, or reacquired Common Stock.

     

     

    
      
        
        

      

      
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    If an
Option or Stock Purchase Right expires or becomes un-exercisable without having
been exercised in full, or is surrendered pursuant to an Option Exchange
Program, the un-purchased Shares which were subject thereto shall become
available for future grant or sale under the Plan (unless the Plan has
terminated); provided, however,
that Shares that have actually been issued under the Plan, whether upon exercise
of an Option or Right, shall not be returned to the Plan and shall not become
available for future distribution under the Plan, except that if Shares of
Restricted Stock are repurchased by the Company at their original purchase
price, and the original purchaser of such Shares did not receive any benefits of
ownership of such Shares, such Shares shall become available for future grant
under the Plan.  For purposes of the preceding sentence, voting rights
shall not be considered a benefit of Share ownership.

    

    ARTICLE
IV

    

    Administration of the
Plan.

    

    (a)           Initial Plan
Procedure.  Prior to the date, if any, upon which the Company
becomes subject to the Exchange Act, the Plan shall be administered by the Board
or a committee appointed by the Board.

    

    

    (b)           Plan Procedure after the
Date, if any, upon Which the Company becomes Subject to the Exchange
Act.

    

    (i)           Administration With Respect
to Directors and Officers.  With respect to grants of Options
or Stock Purchase Rights to Employees who are also officers or directors of the
Company, the Plan shall be administered by

    

    (A) The
Board if the Board may administer the Plan in compliance with Rule 16b-3
promulgated under the Exchange Act or and successor thereto (Rule 16b-3") with
respect to a plan intended to qualify thereunder as a discretionary plan,
or

    

     (B)
A committee designated by the Board to administer the Plan, which committee
shall be constituted in such a manner as to permit the Plan to comply with Rule
16b-3 with respect to a plan intended to qualify there under as a discretionary
plan.  Once appointed, such Committee shall continue to serve in its
designated capacity until otherwise directed by the Board.  From time
to time the Board may increase the size of the Committee and appoint additional
members thereof, remove members (with or without cause) and appoint new members
is substitution therefor, fill vacancies, however caused, and remove all members
of the Committee and thereafter directly administer the Plan, all to the extent
permitted by Rule 16b-3 with respect to a plan intended to qualify thereunder as
a discretionary plan.

     

     

    
      
        
        

      

      
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    (ii)           Multiple Administrative
Bodies.  If permitted by Rule 16b-3, the Plan may be
administered by different bodies with respect to directors, non-director
officers and Employees who are neither directors nor officers.

    

    (iii)           Administration With Respect
to Consultants and Other Employees. With respect to grants of Options or
Stock Purchase Rights to Employees or Consultants who are neither directors nor
officers of the Company, the Plan shall be administered by

    

    (A) The
Board or

    

     (B)
A committee designated by the Board, which committee shall be constituted in
such a manner as to satisfy the legal requirements relating to the
administration of incentive stock option plans, if any, of California corporate
and securities laws, of the Internal Revenue Code, and of any applicable stock
exchange (the Applicable Laws).  Once appointed, such Committee shall
continue to serve in its designated capacity until otherwise directed by the
Board.  From time to time the Board may increase the size of the
Committee and appoint additional members thereof, remove members (with or
without cause) and appoint new members in substitution therefor, fill vacancies,
however caused, and remove all members of the Committee and thereafter directly
administer the Plan, all to the extent permitted by Applicable
Laws.

    

    (c)         
 Powers of the
Administrator. Subject to the provisions of the Plan, and, in the case of
a Committee, the specific duties delegated by the Board of such Committee, and
subject to the approval of any relevant authorities, including the approval, if
required, of any stock exchange upon which the Common Stock is listed, the
Administrator shall have the authority, in its discretion:

    

    (i)     to determine
the Fair Market Value of the Common Stock, in accordance with Article II(k) of
the Plan;

    

    (ii)     to select the
Consultants and Employees to whom Options and Stock Purchase Rights may from
time to time be granted hereunder;

    

    (iii)     to determine
whether and to what extent Options and Stock Purchase Rights or any combination
thereof are granted hereunder;

    

    (iv)     to determine
the number of shares of Common Stock to be covered by each such award granted
hereunder;

     

     

    
      
        
        

      

      
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    (v)           to
approve forms of agreement for use under the Plan;

    

    (vi)          to
determine the terms and conditions of any award
granted  hereunder;

    

    (vii)          to
determine whether and under what circumstances an Option may be settled in cash
under Article IX (f) instead of Common Stock;

    

    (viii)         to
reduce the exercise price of any Option to the then current Fair Market Value if
the Fair Market Value of the Common Stock covered by such Option shall have
declined since the date the Option was granted;

    

    (ix)            to
determine the terms and restrictions applicable to Stock Purchase Rights and the
Restricted Stock purchased by exercising such Stock Purchase Rights;
and

    

    (x)           
 to construe and interpret the terms of the Plan and awards granted
pursuant to the Plan.

    

    (d)       
 Effect of
Administrator's Decision. All decisions, determinations and
interpretations of the Administrator shall be final and binding on all Optionees
and any other holders of any Options or Stock Purchase Rights.

    

    

    ARTICLE
V

                Eligibility.

    

    (a)          
Nonstatutory Stock Options and Stock Purchase Rights may be granted to Employees
and Consultants. Incentive Stock Options may be granted only to Employees. An
Employee or Consultant who has been granted an Option or Stock Purchase Right
may, if otherwise eligible, be granted additional Options or Stock Purchase
Rights.

    

    (b)           
Each Option shall be designated in the written option agreement as either an
Incentive Stock Option or a Nonstatutory Stock Option. However, notwithstanding
such designations, to the extent that the aggregate Fair Market
Value:

    

    (i)           
Number of Shares subject to an Optionee's Incentive Stock Options granted by the
Company, any Parent or Subsidiary, which

    

    (ii)           become
exercisable for the first time during any calendar year (under all plans of the
Company or any Parent or Subsidiary) exceeds $100,000, such excess Options shall
be treated as Nonstatutory Stock Options.  For purposes of this
Article  (b), Incentive Stock Options shall be taken into account in
the order in which they were granted, and the Fair Market Value of the Shares
shall be determined as of the time the Option with respect to such Shares is
granted.

     

     

    
      
        
        

      

      
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    (c)           The
Plan shall not confer upon any Optionee any right with respect to continuation
of employment relationship with the Company, nor shall it interfere in any way
with his or her right or the Company's right to terminate his or her employment
relationship at any time, with or without cause.

    

    (d)           Upon
the Company or a successor corporation issuing any class of common equity
securities required to be registered under Section 12 of the Exchange Act or
upon the Plan being assumed by a corporation having a class of common equity
securities required to be registered under Section 12 of the Exchange Act, the
following limitations shall apply to grants of options and Stock Purchase Rights
to Employees:

    

    (i)           No
Employee shall be granted, in any fiscal year of the Company, Options and Stock
Purchase Rights to purchase more  than 1,000,000 Shares.

    

    (ii)           The
foregoing limitations shall be adjusted proportionately in connection with any
change in the Company's capitalization as described in Article XII.

    

    (iii)           If
an Option or Stock Purchase Right is canceled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Article XII), the canceled Option will be counted against the limit
set forth in Article V(d)(i).  For this purpose, if the exercise price
of an Option is reduced, the transaction will be treated as a cancellation of
the Option and the grant of a new Option.

    

    ARTICLE
VI

    

    Term of
Plan.      The
Plan shall become effective upon the earlier to occur of its adoption by the
Board of Directors or its approval by the shareholders of the Company, as
described in Article XIX of the Plan.  It shall continue in effect for
a term of ten (10) years unless sooner terminated under Article XIV of the
Plan.

    

    
      
        
        

      

      
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    ARTICLE
VII

    

    Term of
Option.  The term of each
Option shall be the term stated in the Option Agreement; provided, however, that
the term shall be no more  Ten (10) years from the date
of grant thereof.  However, in the case of an Incentive Stock Option
granted to an Optionee who, at the time the Option is granted, owns stock
representing more than ten percent (10%) of the voting power of all classes of
stock of the Company or any Parent or Subsidiary, the term of the Option shall
be Five (5) years from
the date of grant thereof or such shorter term as may be provided in the Option
Agreement.

    

    ARTICLE
VIII

    

    Option Exercise Price and
Consideration.

    

    (a)           The
per share exercise price for the Shares to be issued pursuant to exercise of an
Option shall be such price as is determined by the Administrator.

    

    (b)           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 Administrator (and,
in the case of an Incentive Stock Option, shall be determined at the time of
grant) and may consist entirely of;

     (1)
cash,

    

    (2)
check,

    

    (3)
promissory note,

    

    (4) other
Shares which (i) in the case of Shares acquired upon exercise of an Option, have
been owned by the Optionee for more than six months on the date of surrender,
and (ii) 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,

    

    (5)
delivery of a properly executed exercise notice together with such other
documentation as the Administrator and the broker, if applicable, shall require
to effect an exercise of the Option and delivery to the Company of the sale or
loan proceeds required to pay the exercise price, or

    

    (6) any
combination of the foregoing methods of payment.  In making its
determination as to the type of consideration to accept, the Administrator shall
consider if acceptance of such consideration may be reasonably expected to
benefit the Company.

    

    

    

    
      
        
        

      

      
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    ARTICLE
IX

    

    Exercise of
Option.

    

    (a)           Procedure for Exercise;
Rights as a Shareholder.  Any Option granted hereunder shall be
exercisable at such times and under such conditions as determined by the
Administrator, including performance criteria with respect to the Company and/or
the Optionee, and as shall be permissible under the terms of the
Plan.

    

    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 in accordance with the terms of the Option by the person
entitled to exercise the Option and full payment for the Shares with respect to
which the Option is exercised has been received by the Company.  Full
payment may, as authorized by the Administrator, consist of any consideration
and method of payment allowable under Article VIII(b) of the
Plan.  Until the issuance (as evidenced by the appropriate entry on
the books of the Company or of a duly authorized transfer agent of the Company)
of the stock certificate evidencing such Shares, no right to vote or receive
dividends or any other rights as a shareholder shall exist with respect to the
Optioned Stock, notwithstanding the exercise of the Option.  The
Company shall issue (or cause to be issued) such stock certificate promptly upon
exercise of the Option.  No adjustment will be made for a dividend or
other right for which the record date is prior to the date the stock certificate
is issued, except as provided in Article XII of the Plan.

    

    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 the Plan and for sale
under the Option, by the number of Shares as to which the Option is
exercised.

    

    (b)           Termination of Employment or
Consulting Relationship.  In the  event of
termination of an Optionee's Continuous Status as an Employee or Consultant with
the Company (but not in the event of an Optionee's change of status from
Employee to Consultant (in which case an Employee's Incentive Stock Option shall
automatically convert to a Nonstatutory Stock Option on the ninety-first (91st)
day following such change of status) or from Consultant to Employee), other than
upon the Optionee's death or disability, such Optionee may, but only within such
period of time as is determined by the Administrator (with such determination in
the case of an Incentive Stock Option not to exceed three (3) months after the
date of such termination (but in no event later than the expiration date of the
term of such Option as set forth in the Stock Option Agreement), exercise his or
her Option to the extent that Optionee was entitled to exercise it at the date
of such termination (but in no event later than the expiration date of the term
of such Option as set forth in the Stock Option Agreement).

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

     To
the extent that Optionee was not entitled to exercise the Option at the date of
such termination, or if Optionee does not exercise such Option to the extent so
entitled within the time specified herein, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.

    

    (c)           Disability of
Optionee.  In the event of termination of an Optionee's
consulting relationship or Continuous Status as an Employee as a result of his
or her disability, Optionee may, but only within twelve (12) months from the
date of such termination (and in no event later than the expiration date of the
term of such Option as set forth in the Stock Option Agreement), exercise the
Option at twice the extent otherwise entitled to exercise it at the date of such
termination; provided, however, that if such disability is not a Adisability@ as
such term is defined in Section 22(e)(3) of the Internal Revenue Code, in the
case of an Incentive Stock Option on the day three (3) months and one (1) day
following such termination.  For purposes of this subparagraph, to the
extent that Optionee is not entitled to exercise the Option at the date of
termination to the extent so entitled under this subparagraph, or if Optionee
does not exercise such Option to the extent so entitled within the time
specified herein, the Option shall terminate, and the Shares covered by such
Option shall revert to the Plan.

    

    (d)           Death or Disability of
Optionee.  In the event of the death of an Optionee, the Option
may be exercised at twice the extent the Optionee was otherwise entitled to
exercise it at the date of the Optione's death.  Said exercise may be
by the Optionee's estate or by a person who acquired the right to exercise the
Option by bequest or inheritance, as the case may be. The Shares covered by the
unexercisable portion of the Option as determined by the formula in this
subparagraph shall immediately revert to the Plan.  If, after death,
the Optionee's estate or a person who acquired the right to exercise the Option
by bequest or inheritance does not exercise the Option within twelve (12) months
of the date of Optionee's death, the Option shall terminate, and the Shares
covered by such Option shall revert to the Plan.

    

    (e)           Rule
16b-3.  Options granted to persons subject to Section 16(b) of
the Exchange Act must comply with Rule 16b-3 and shall contain such additional
conditions or restrictions as may be required thereunder to qualify for the
maximum exemption from Section 16 of the Exchange Act with respect to Plan
transactions.

    

    (f)           Buyout
Provisions.  The Administrator may at any time offer to buy out
for a payment in cash or Shares, an Option previously granted, based on such
terms and conditions as the Administrator shall establish and communicate to the
Optionee at the time that such offer is made.

    

    

    

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    

    

    ARTICLE
X

    

    Non-Transferability
of Options and Stock Purchase Rights.  Options and Stock
Purchase Rights may not be sold, pledged, assigned, hypothecated, transferred,
or disposed of in any manner other than by will or by the laws of descent or
distribution and may be exercised, during the lifetime of the Optionee, only by
the Optionee.

    

    

    ARTICLE
XI

    Stock Purchase
Rights.

    

    (a)           Rights to
Purchase.  Stock Purchase Rights may be issued either alone, in
addition to, or in tandem with other awards granted under the Plan and/or cash
awards made outside of the Plan.  After the Administrator determines
that it will offer Stock Purchase Rights under the Plan, it shall advise the
offeree in writing of the terms, conditions and restrictions related to the
offer, including the number of Shares that such person shall be entitled to
purchase, the price to be paid, and the time within which such person must
accept such offer, which shall in no event exceed thirty (30) days from the date
upon which the Administrator made the determination to grant the Stock Purchase
Right.  The offer shall be accepted by execution of a Restricted Stock
purchase agreement in the form determined by the
Administrator.  Shares purchased pursuant to the grant of a Stock
Purchase Right shall be referred to herein as ARestricted
Stock.

    

    (b)           Repurchase Option.
Unless the Administrator determines otherwise, the Restricted Stock purchase
agreement shall grant the Company a repurchase option exercisable upon the
voluntary or involuntary termination of the purchaser's employment with the
Company for any reason (including death or Disability).  The purchase
price for Shares repurchased pursuant to the Restricted Stock purchase agreement
shall be the original price paid by the purchaser and may be paid by
cancellation of any indebtedness of the purchaser of the Company.  The
repurchase  option shall lapse at such rate as the Administrator may
determine, but at a minimum rate of twenty percent (20%) per year.

    

    (c)           Other
Provisions.  The Restricted Stock purchase agreement shall
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Administrator in its sole
discretion.  In addition, the provisions of Restricted Stock purchase
agreements need not be the same with respect to each purchaser.

    

    (d)           Rights as a
Shareholder.  Once the Stock Purchase Right is exercised, the
purchaser shall have the rights equivalent to those of a shareholder, and shall
be a shareholder when his or her purchase is entered upon the records of the
duly authorized transfer agent of the Company.  No adjustment will be
made for a dividend or other right for which the record date is prior to the
date the Stock Purchase Right is exercised, except as provided in Article XII of
the Plan.

     

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    ARTICLE
XII

    

    Adjustments Upon Changes in
Capitalization or Merger

    

    (a) Changes in
Capitalization.  Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option or Stock Purchase Right, and number of shares of Common
Stock which have been authorized for issuance under the Plan but as to which no
Options or Stock Purchase Rights have yet been granted or which have been
returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, as well as the price per share of Common Stock covered by each
such outstanding Option or Stock Purchase Right, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of 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; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been effected
without 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 issuance 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 price of shares of Common Stock subject to
an Option or Stock Purchase Right.

    

    (b)           Dissolution or
Liquidation.  In the event of the proposed dissolution or
liquidation of the Company, the Administrator shall notify the Optionee at least
fifteen (15) days prior to such proposed action.  To the extent it has
not been previously exercised, the Option or Stock Purchase Right will terminate
immediately prior to the consummation of such proposed action.

    

    (c)           Merger.  In
the event of a merger of the Company with or into another corporation, each
outstanding Option or Stock Purchase Right shall be assumed or an equivalent
option or right shall be substituted by such successor corporation or a parent
or subsidiary of such successor corporation.  If, in such event, the
Option or Stock Purchase Right is not assumed or substituted, the Option or
Stock Purchase Right shall vest immediately prior to the close of the
merger.  For the purposes of this paragraph, the Option or Stock
Purchase Right shall be considered assumed if, following the merger, the option
or right confers the right to purchase, for each Share of Optioned Stock subject
to the Option or Stock Purchase Right immediately prior to the merger, the
consideration (whether stock, cash, or other securities or property) received in
the merger by holders of Common Stock for each Share held on the effective date
of the transaction (and if holders were offered a choice of consideration, the
type of consideration chosen by the holders of a majority of the outstanding
Shares); provided, however, that if such consideration received in the merger
was not solely common stock of the successor corporation or its Parent, the
Administrator may, with the consent of the successor corporation, provide for
the consideration to be received upon the exercise of the Option or Stock
Purchase Right, for each Share of Optioned Stock subject to the Option or Stock
Purchase Right, to be solely common stock of the successor corporation or its
Parent equal in fair market value to the per share consideration received by
holders of Common Stock in the merger.

     

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

    
 

    ARTICLE
XIII

    

    Time of
Granting Options and Stock Purchase Rights.  The date of grant
of an Option or Stock Purchase Right shall, for all purposes, be the date on
which the Administrator makes the determination granting such Option or Stock
Purchase Right, or such other date as is determined by the
Administrator.  Notice of the determination shall be given to each
Employee or Consultant to whom an Option or Stock Purchase Right is so granted
within a reasonable time after the date of such grant.

    

    ARTICLE
XIV

    

    Amendment and Termination of
the Plan.

    

    (a)           Amendment and
Termination.  The Board may at any time amend, alter, suspend
or discontinue the Plan, but no amendment, alteration, suspension or
discontinuation shall be made which would impair the rights of any Optionee
under any grant theretofore made, without his or her consent.  In
addition, to the extent necessary and desirable to comply with Rule 16b-3 under
the Exchange Act or with Section 422 of  the Internal Revenue Code (or
any other applicable law or regulation, including the requirements of the NASD
or an established stock exchange), the Company shall obtain shareholder approval
of any Plan amendment in such a manner and to such a degree as
required.

    

    (b)           Effect of Amendment or
Termination.  Any such amendment or termination of the Plan
shall not affect Options or Stock Purchase Rights already granted, and such
Option and Stock Purchase Rights 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 Administrator, which agreement must be in writing
and signed by the Optionee and the Company.

    

    ARTICLE
XV

    

    Conditions
upon Issuance of Shares.  Shares shall not
be issued pursuant to the exercise of an Option or Stock Purchase Right unless
the exercise of such Option or Stock Purchase Right and the issuance and
delivery of such Shares pursuant thereto shall comply with all relevant
provisions of law, including, without limitation, the Securities Act of 1933, as
amended, the Exchange Act, the rules and regulations promulgated thereunder, and
the requirements 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.

     

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    
 

    As a
condition to the exercise of an Option or Stock Purchase Right, the Company may
require the person exercising such Option or Stock Purchase Right to represent
and warrant at the time of any such exercise 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
required by any of the aforementioned relevant provisions of law.

    

    ARTICLE
XVI

    

    Reservation
of Shares.  The Company,
during the term of this Plan, will at all times reserve and keep available such
number of Shares as shall be sufficient to satisfy the requirements of the
Plan.

    

    The
inability of the Company to obtain authority from any regulatory body having
jurisdiction, which authority is deemed by the Company's counsel to be necessary
to the lawful issuance and sale of any Shares hereunder, shall relieve the
Company of any liability in respect of the failure to issue or sell such Shares
as to which such requisite authority shall not have been obtained.

    

    ARTICLE
XVII

    

    Agreements.  Options and Stock
Purchase Rights shall be evidenced by written agreements in such form as the
Administrator shall approve from time to time.

    

    ARTICLE
XVIII

    

    Shareholder
Approval.  The Plan shall be
subject to approval by the shareholders of the Company within twelve (12) months
before or after the date the Plan is adopted.  Such shareholder
approval shall be obtained in the degree and manner required under California
and federal law and the rules of any stock exchange upon which the Common Stock
is listed.

     

    ARTICLE XIX

    

    Information
to Optionees and Purchasers.  The Company shall
provide to each Optionee and to each individual who acquired Shares pursuant to
the Plan, not less frequently than annually during the period such Optionee or
purchaser has one or more Options or Stock Purchase Rights outstanding, and, in
the case of an individual who acquired Shares pursuant to the Plan, during the
period such individual owns such Shares, copies of annual financial
statements.  The Company shall not be required to provide such
statements to key employees whose duties in connection with the Company assure
their access to equivalent information.

    

    

    
      
        
        

      

      
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                                                             ______________________________________

                                                          Lee
Miller

    

    

     
Dated:  February
5th
2005                                                                                                        Lee
Miller, Chairman

                                                                                                                                      
   Chairman of the Board of Directors

    

    

    

    

    End

     

     

    -15-

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