Document:

Translated From the Original Mandarin

Guarantee Contract

 

 

 

 

 

 

 

 

Creditor: Song Yuan City Wu Lan Da Jie Cheng Shi Xin Yong She                

Assurer: Songyuan City Hongxiang Petroleum Technical Services Co., Ltd

 

Guarantee Contract

No.27 2005

 

Creditor: Song Yuan City Wu Lan Da Jie Cheng Shi Xin Yong She

Assuror: Songyuan City Hong Xiang Petroleum Technical Services Co., Ltd 

In order to guarantee that the Creditor can claim money, the borrower, Songyuan City Yu Qiao Qianan Hong Xiang Oil and Gas Development Co., Ltd, assuror, to provide guarantee, and assuror understands the situation of the
borrower, and voluntarily provides the guarantee. In order to define the rights and obligations of both sides, pursuant to “China Contract Law,” China hypothecate law and other relevant laws, after both parties arrive at consensus, the
contract was made.

Article 1. Scope of Guarantee
The scope of guarantee for assuror is the loan, interest and any relevant expenses.

Article 2. Way to Guarantee
Way that the guarantor guarantees is guaranteed for joint liability.

Article 3. Guarantee Period	The guarantee period is the day after the main contract was signed, until the main contract is expired.
 
	Creditor and borrower reach the written agreement on fulfilling time limit in main contract,
 
	If the terms that the rules and regulations or the main contract agree on occures, cause the main contract debt to expire ahead of time, then

Article 4. The Promises of Guarantor	Assuror must provied any relevent document reqired by creditor, and promises the truth and validity of the document provied.

 
	The borrower has not fulfilled debts in terms of the contract, guarantor voluntarily fulfil the responsibility of guaranteeing, and creditor has the right to takes money directly from guarantor’s account.

 

	When the following situation takes place, creditor should be informed

	There is a change of company organization, such as buy out, merge, set up subsidiary, change the stock share structure, etc. shall inform lien
holder within 30 days. 
	There is change of scope of business, registered capital, change of management shall inform lien holder within 30 days.

	In the event of exacerbation of financial situation or involvement of financial conflicts, any
material fact that might have impact on the pledgor’s ability to fulfill its obligation, the pledgor must notify the lien holder within 5 days.

	In the event of bankruptcy, interruption of operation, ceasing operation for reconstruction,
business registration withdrawal and revocation and etc, the pledgor must notify the lien holder within 5 days.

Article 5. Alteration, Breach and Inuring of the Contract

	This covenant is effective upon signing or seal.
	After this contract takes into effect, either party can't alter or terminate without authorization. It could be altered or terminated when consulting all the time and reaching the written agreement through both sides.
Before the written agreement is reached, the contract still comes into force.
	This covenant is independent, not revocable even the major covenant revoked. If change or revocation needed, there must be mutual agreement by both parties. Before written agreement, this covenant is still
effective
	After this covenant takes into effect, creditor and guarantor should fulfill the obligation described within this covenant. The party failed to fulfill its obligation must bear corresponding responsibilities, and
indemnify the other party’s loss.
	 In case the guarantor takes any action with any economical losses, the guarantor should indemnify the creditor in full.

Article 6. Miscellaneous
[Intentionally left blank]

Article 7. Settlement of Conflict

Any conflict, aroused during the fulfillment of this covenant, can be either settled by negotiation by both parties or be the jurisdiction of the lien holder’s local court.

Article 8. Copy of Agreement
Two copies of this agreement, each party has one copy, which has the same force and effect.

Article 9. Announcements
The lien holder has requested the pledge to understand this covenant accurately and fully. The lien holder also explained per pledger’s request. Both parties reached the same understanding with respect to this
covenant.

	
Creditor: 
	
Guarantor: 

	
 

	
Song Yuan City Wu Lan Da Jie 
Cheng Shi Xin Yong She	
/s/ 
	
Hong Jun Wang 

	
 
	
/s/ 
	
Ji Shuang Sun 

	
          [Seal] 
	
 
	
 

	
 

	
 

	
Signing Date: September 22nd, 2005Exhibit 4.1

Exhibit 4.1

APPENDIX "C"

The 2004 Stock Option Plan and individual stock option agreements under the
2004 Stock Option Plan were amended by a directors' resolution date September
13, 2005. A Form S-8 concerning this amendment and a similar amendment to the
2001 Stock Option Plan has or will be filed by the Company. The outstanding 2004
Stock Option Plan was amended to read as follows:

SUN NEW MEDIA INC.

(fka SE Global Equities Corp.)

2004 STOCK OPTION PLAN

This 2004 Stock Option Plan (the "Plan") provides for the grant of
options to acquire common shares (the "Common Shares") in the capital
of Sun New Media Inc. (fka SE Global Equities Corp.), a corporation formed under
the laws of the State of Minnesota (the "Corporation"). Stock options
("Options") granted under this Plan will include:

	stock options that qualify under Section 422 of the Internal Revenue
    Code of 1986, as amended (the "Code"), which will be referred to
    in this Plan as "Incentive Stock Options"; and
	stock options that do not qualify under Section 422 of the Code,
    which will be referred to in this Plan as "Non-Qualified Stock
    Options".

1. PURPOSE

	The purpose of this Plan is to retain the services of valued key employees
  and consultants of the Corporation and such other persons as the Plan
  Administrator shall select in accordance with Section 4 below, and to
  encourage such persons to acquire a greater proprietary interest in the
  Corporation, thereby strengthening their incentive to achieve the objectives
  of the shareholders of the Corporation, and to serve as an aid and inducement
  in the hiring of new employees and to provide an equity incentive to
  consultants and other persons selected by the Plan Administrator.
	This Plan shall at all times be subject to all legal requirements relating
  to the administration of stock option plans, if any, under applicable
  corporate laws, applicable United States federal and state securities laws,
  the Code, the rules of any applicable stock exchange or stock quotation
  system, and the rules of any foreign jurisdiction applicable to Options
  granted to residents therein (collectively, the "Applicable Laws").

2. ADMINISTRATION

	This Plan shall be administered initially by the Board of Directors of the
  Corporation (the "Board"), except that the Board may, in its
  discretion, establish a committee composed of two (2) or more members of the
  Board or two (2) or more other persons to administer the Plan, which committee
  (the "Committee") may be an executive, compensation or other
  committee, including a separate committee especially created for this purpose.
  The Board or, if applicable, the Committee is referred to herein as the
  "Plan Administrator".
	If and so long as the Common Stock is registered under Section 12(b) or
  12(g) of the Securities Exchange Act of 1934, as amended (the
  "Exchange Act"), the Board shall consider in selecting the Plan
  Administrator and the membership of any Committee, with respect to any persons
  subject or likely to become subject to Section 16 of the Exchange Act, the
  provisions regarding (a) "outside directors" as contemplated by
  Section 162(m) of the Code, and (b) "Non-Employee Directors" as
  contemplated by Rule 16b-3 under the Exchange Act.

	The Committee shall have the powers and authority vested in the Board
  hereunder (including the power and authority to interpret any provision of the
  Plan or of any Option). The members of any such Committee shall serve at the
  pleasure of the Board. A majority of the members of the Committee shall
  constitute a quorum, and all actions of the Committee shall be taken by a
  majority of the members present. Any action may be taken by a written
  instrument signed by all of the members of the Committee and any action so
  taken shall be fully effective as if it had been taken at a meeting.

   

	Subject to the provisions of this Plan and any Applicable Laws, and with a
    view to effecting its purpose, the Plan Administrator shall have sole
    authority, in its absolute discretion, to:

	construe and interpret this Plan;
	define the terms used in the Plan;
	prescribe, amend and rescind the rules and regulations relating to this
      Plan;
	correct any defect, supply any omission or reconcile any inconsistency
      in this Plan;
	grant both Incentive Stock Options and Non-Qualified Stock Options under
      this Plan;
	determine the individuals to whom Options shall be granted under this
      Plan and whether an Option is an Incentive Stock Option or a Non-Qualified
      Stock Option;
	determine the time or times at which Incentive Stock Options and
      Non-Qualified Stock Options shall be granted under this Plan;
	determine the number of Common Shares subject to each Incentive Stock
      Option or Non-Qualified Stock Option, the exercise price of each Incentive
      Stock Option or Non-Qualified Stock Option, the duration of each Incentive
      Stock Option or Non-Qualified Stock Option and the times at which each
      Incentive Stock Option or Non-Qualified Stock Option shall become
      exercisable;
	determine all other terms and conditions of the Incentive Stock Options
      and Non-

      Qualified Stock Options;
	make all other determinations and interpretations necessary and
      advisable for the

      administration of the Plan;
	All decisions, determinations and interpretations made by the Plan
      Administrator shall be binding and conclusive on all participants in the
      Plan and on their legal representatives, heirs and beneficiaries; and
	All decisions, determinations, interpretations and actions involving a
      conflict of interests between the Corporation and a Director of the
      Corporation shall be made or taken by the Plan Administrator in accordance
      with Section 302A.255 of the Minnesota Business Corporation Act.

3. ELIGIBILITY

	Incentive Stock Options may be granted to any individual who, at the time
  the Incentive Stock Option is granted, is an employee of the Corporation or
  any Related Corporation (as defined below) ("Employees").

-2-

	Non-Qualified Stock Options may be granted to Employees and to such other
  persons, including directors, officers and consultants of the Corporation or
  any Related Corporation, who are not Employees as the Plan Administrator shall
  select, subject to any Applicable Laws.
	Options may be granted in substitution for outstanding Options of another
  corporation in connection with the merger, consolidation, acquisition of
  property or stock or other reorganization between such other corporation and
  the Corporation or any subsidiary of the Corporation. Options also may be
  granted in exchange for outstanding Options.

	Any person to whom an Option is granted under this Plan is referred to as
    an "Optionee". Any person who is the owner of an Option is
    referred to as a "Holder".
	As used in this Plan, the term "Related Corporation" shall mean
    any corporation (other than the Corporation) that is a "Parent
    Corporation" of the Corporation or "Subsidiary Corporation"
    of the Corporation, as those terms are defined in Sections 424(e) and
    424(f), respectively, of the Code (or any successor provisions) and the
    regulations thereunder (as amended from time to time).

4. STOCK

The Plan Administrator is authorized to grant Options to acquire up to a
total of up to 2,500,000 of the Corporation's Common Shares, provided
however, that the maximum number of Common Shares available for grant of
Incentive Stock Options under the Plan shall equal to 700,000 Common Shares. The
number of Common Shares with respect to which Options may be granted hereunder
is subject to adjustment as set forth in Section 6.1(m) hereof. In the
event that any outstanding Option expires or is terminated for any reason, the
Common Shares allocable to the unexercised portion of such Option may again be
subject to an Option granted to the same Optionee or to a different person
eligible under Section 4 of this Plan; provided however, that any cancelled
Options will be counted against the maximum number of shares with respect to
which Options may be granted to any particular person as set forth in
Section 4 hereof.

5. TERMS AND CONDITIONS OF OPTIONS

Each Option granted under this Plan shall be evidenced by a written agreement
approved by the Plan Administrator (each, an "Agreement"). Agreements
may contain such provisions, not inconsistent with this Plan or any Applicable
Laws, as the Plan Administrator in its discretion may deem advisable. All
Options also shall comply with the following requirements:

  	Number of Shares and Type of Option. Each Agreement shall state
  the number of

  Common Shares to which it pertains and whether the Option is intended to be an
  Incentive Stock Option or a Non-Qualified Stock Option; provided that:

	the number of Common Shares that may be reserved pursuant to the
      exercise of Options

      granted to any person shall not exceed 1,500,000 Common Shares and the
      number of Common Shares that may be reserved pursuant to the exercise of
      Incentive Stock Options granted to any person shall not exceed 700,000
      Common Shares;
	in the absence of action to the contrary by the Plan Administrator in
      connection with the grant of an Option, all Options shall be Non-Qualified
      Stock Options;
	 the aggregate fair market value (determined at the Date of Grant,
      as defined below) of the Common Shares with respect to which Incentive
      Stock Options are exercisable for the first time by the Optionee during
      any calendar year (granted under this Plan and all other Incentive Stock
      Option plans of the Corporation, a Related Corporation or a predecessor
      corporation) shall not exceed U.S.$100,000, or such other limit as may be
      prescribed by the Code as it may be amended from time to time (the
      "Annual Limit"); and 

-3-

	any portion of an Option which exceeds the Annual Limit shall not be
      void but rather shall be a Non-Qualified Stock Option.

  
  	Date of Grant.  Each Agreement shall state the date the Plan
  Administrator has deemed to be the effective date of the Option for purposes
  of this Plan (the "Date of Grant").

  	Option Price. Each Agreement shall state the price per Common
  Share at which it is exercisable. The Plan Administrator shall act in good
  faith to establish the exercise price in accordance with Applicable Laws; provided
  that:

	per share exercise price for an Incentive Stock Option or any Option
      granted to a "Covered Employee" as such term is defined for
      purposes of Section 162(m) of the Code shall not be less than the
      fair market value per Common Share at the Date of Grant as determined by
      the Plan Administrator in good faith;
	respect to Incentive Stock Options granted to greater-than-ten percent
      (>10%) shareholders of the Corporation (as determined with reference to
      Section 424(d) of the Code), the exercise price per share shall not
      be less than one hundred ten percent (110%) of the fair market value per
      Common Share at the Date of Grant as determined by the Plan Administrator
      in good faith;
	Options granted in substitution for outstanding options of another
      corporation in connection with the merger, consolidation, acquisition of
      property or stock or other reorganization involving such other corporation
      and the Corporation or any subsidiary of the Corporation may be granted
      with an exercise price equal to the exercise price for the substituted
      option of the other corporation, subject to any adjustment consistent with
      the terms of the transaction pursuant to which the substitution is to
      occur; and
	the per share exercise price for a Non-Qualified Stock Option shall not
      be less than 85% of the fair market value per Common Share traded through
      the facilities of Over-the-Counter Bulletin Board service of the National
      Association of Securities Dealers Inc., Nasdaq Small Cap Market, Nasdaq
      National Market or the American Stock Exchange (each a "Designated
      Exchange"), or if the Common Shares are not listed for trading on a
      Designated Exchange, through such other exchange or quotation system on
      which the Common Shares are listed or quoted for trading, at the Date of
      Grant, less any discount permitted by the Designated Exchange.

  
  	
    Duration of Options. At the time of the grant of the Option, the
  Plan Administrator shall designate, subject to Section 6.1(g) below, the
  expiration date of the Option, which date shall not be later than ten (10)
  years from the Date of Grant; provided, that:

  	the expiration date of any Incentive Stock Option granted to a
    greater-than-ten percent (>10%) shareholder of the Corporation (as
    determined with reference to Section 424(d) of the Code) shall not be
    later than five (5) years from the Date of Grant;
	so long as the Common Shares are traded on a Designated Exchange, all
    Options granted under this Section 6 shall expire not later than five
    (5) years from the Date of Grant; and
	if the Common Shares are not traded on a Designated Exchange and in the
    absence of action to the contrary by the Plan Administrator in connection
    with the grant of a particular Option, and except in the case of Incentive
    Stock Options as described above, all Options granted under this
    Section 6 shall expire not later than ten (10) years from the Date of
    Grant.

  	Vesting Schedule. No Option shall be exercisable until it has
  vested. All Non-Qualified

  Stock Options will vest at the Date of Grant thereof. The Plan Administrator
  shall specify the vesting schedule of an Incentive Stock Option at the Date of
  Grant thereof prior to the provision of services with respect to which such
  Incentive Stock Option is granted; provided, that if no vesting
  schedule is specified at the time of grant, the Incentive Stock Option shall
  vest according to the following schedule:

-4-

  

  
	
      Percentage of Total Incentive Stock Option Vested
	
      Number of Months

      Following Date of Grant

	
      30%
	
      6 Months

	
      40%
	
      12 Months

	
      30%
	
      18 Months

  

The Plan Administrator may specify a vesting schedule for all or any portion
of an Incentive Stock Option based on the achievement of performance objectives
established in advance of the commencement by the Optionee of services related
to the achievement of the performance objectives. Performance objectives shall
be expressed in terms of objective criteria, including but not limited to, one
or more of the following: return on equity, return on assets, share price,
market share, sales, earnings per share, costs, net earnings, net worth,
inventories, cash and cash equivalents, gross margin or the Corporation's
performance relative to its internal business plan. Performance objectives may
be in respect of the performance of the Corporation as a whole (whether on a
consolidated or unconsolidated basis), a Related Corporation, or a subdivision,
operating unit, product or product line of either of the foregoing. Performance
objectives may be absolute or relative and may be expressed in terms of a
progression or a range. An Incentive Stock Option that is exercisable (in full
or in part) upon the achievement of one or more performance objectives may be
exercised only following written notice to the Optionee and the Corporation by
the Plan Administrator that the performance objective has been achieved.

  	Acceleration of Vesting. The vesting of one or more outstanding
  Incentive Stock Options may be accelerated by the Plan Administrator at such
  times and in such amounts as it shall determine in its sole discretion.

  	Term of Option
  

	Options that have vested shall terminate, to the extent not previously
    exercised, upon the occurrence of the first of the following events:

	the expiration of the Option, as designated by the Plan Administrator in
      accordance with (d) in this section above; or
	the date of an Optionee's termination of employment or contractual
      relationship with the Company or any Related Corporation (as defined in
      the Plan) for cause (as determined in the sole discretion of the Plan
      Administrator, acting reasonably).

  	Notwithstanding (g)(i) in this section above, any Options that have vested
    and which have been granted to the Optionee in the Optionee's capacity as a
    director of the Corporation or any Related Corporation shall terminate upon
    the occurrence of the first of the following events:

	the event specified in (g)(i)(1) in this section above; or
	the date of an Optionee is removed as a director for cause (as
      determined by the Plan Administrator, acting reasonably).

  	Upon the death of an Optionee, any vested Options held by the Optionee
    shall be exercisable only by the person or persons to whom such Optionee's
    rights under such Option shall pass by the Optionee's will or by the laws of
    descent and distribution of the Optionee's domicile at the time of death and
    only until such Options terminate as provided above.

-5-

	Unless accelerated in accordance with (f) above in this section, unvested
    Incentive Stock Options shall terminate upon:

	the event specified in (g)(i)(1) in this section above; or
	The date of an Optionee's is removed as a director or employment or
      contractual relationship is terminated with the Company or any Related
      Corporation (as defined in the Plan) for cause (as determined in the sole
      discretion of the Plan Administrator, acting reasonably).

  	For purposes of this Plan, transfer of employment between or among the
    Corporation and/or any Related Corporation shall not be deemed to constitute
    a termination of employment with the Corporation or any Related Corporation.
    Employment shall be deemed to continue while the Optionee is on military
    leave, sick leave or other bona fide leave of absence (as determined
    by the Plan Administrator). The foregoing notwithstanding, employment shall
    not be deemed to continue beyond the first one-hundred and twenty (120) days
    of such leave, unless the Optionee's re-employment rights are guaranteed by
    statute or by contract.

  	Exercise of Options.

	Options shall be exercisable, in full or in part, at any time after
        vesting, until termination. If less than all of the shares included in
        the vested portion of any Option are purchased, the remainder may be
        purchased at any subsequent time prior to the expiration of the Option
        term. Only whole shares may be issued pursuant to an Option, and to the
        extent that an Option covers less than one (1) share, it is
        unexercisable.

         
	Options or portions thereof may be exercised by giving written notice
        to the Corporation, which notice shall specify the number of shares to
        be purchased, and be accompanied by payment in the amount of the
        aggregate exercise price for the Common Shares so purchased, which
        payment shall be in the form specified in section (i) below. The
        Corporation shall not be obligated to issue, transfer or deliver a
        certificate representing Common Shares to the Holder of any Option,
        until provision has been made by the Holder, to the satisfaction of the
        Corporation, for the payment of the aggregate exercise price for all
        shares for which the Option shall have been exercised and for
        satisfaction of any tax withholding obligations associated with such
        exercise. During the lifetime of an Optionee, Options are exercisable
        only by the Optionee.

  

  	Payment upon Exercise of Option. Upon the exercise of any Option,
  the aggregate exercise price shall be paid to the Corporation in cash or by
  certified or cashier's check. In addition, if pre-approved in writing by the
  Plan Administrator who may arbitrarily withhold consent, the Holder may pay
  for all or any portion of the aggregate exercise price by complying with one
  or more of the following alternatives:

	by delivering a properly executed exercise notice together with
        irrevocable instructions to a broker promptly to sell or margin a
        sufficient portion of the Common Shares and deliver directly to the
        Corporation the amount of sale or margin loan proceeds to pay the
        exercise price; or  
	by complying with any other payment mechanism approved by the Plan
        Administrator at the time of exercise.

  

  	No Rights as a Shareholder. A Holder shall have no rights as a
  shareholder with respect to any Common Shares covered by an Option until such
  Holder becomes a record holder of such Common Shares, irrespective of whether
  such Holder has given notice of exercise. Subject to the provisions of (m) in
  this section, no rights shall accrue to a Holder and no adjustments shall be
  made on account of dividends (ordinary or extraordinary, whether in cash,
  securities or other property) or distributions or other rights declared on, or
  created in, the Common Shares for which the record date is prior to the date
  the Holder becomes a record holder of the Common Shares covered by the Option,
  irrespective of whether such Holder has given notice of exercise.

  

-6-

  	Non-transferability of Options. Options granted under this Plan
  and the rights and privileges conferred by this Plan may not be transferred,
  assigned, pledged or hypothecated in any manner (whether by operation of law
  or otherwise) other than by will, by applicable laws of descent and
  distribution, and shall not be subject to execution, attachment or similar
  process. Upon any attempt to transfer, assign, pledge, hypothecate or
  otherwise dispose of any Option or of any right or privilege conferred by this
  Plan contrary to the provisions hereof, or upon the sale, levy or any
  attachment or similar process upon the rights and privileges conferred by this
  Plan, such Option shall thereupon terminate and become null and void.

  	Securities Regulation and Tax Withholding

	Common Shares shall not be issued with respect to an Option unless the
        exercise of such Option and the issuance and delivery of such Common
        Shares shall comply with all Applicable Laws, and such issuance shall be
        further subject to the approval of counsel for the Corporation with
        respect to such compliance, including the availability of an exemption
        from prospectus and registration requirements for the issuance and sale
        of such Common Shares. The inability of the Corporation to obtain from
        any regulatory body the authority deemed by the Corporation to be
        necessary for the lawful issuance and sale of any Common Shares under
        this Plan, or the unavailability of an exemption from prospectus and
        registration requirements for the issuance and sale of any Common Shares
        under this Plan, shall relieve the Corporation of any liability with
        respect to the non-issuance or sale of such Common Shares.
	By accepting an Option, the Optionee represents and agrees that none
        of the Common Shares purchased upon exercise of the Option will be
        distributed in violation of any Applicable Laws. As a condition to the
        exercise of an Option, the Plan Administrator may require the Holder to
        represent and warrant in writing at the time of such exercise that the
        Common Shares are being purchased only for investment and without
        then-present intention to sell or distribute such Common Shares. If
        necessary under Applicable Laws, the Plan Administrator may cause a
        stop-transfer order against such Common Shares to be placed on the stock
        books and records of the Corporation, and a legend indicating that such
        Common Shares may not be pledged, sold or otherwise transferred unless
        an opinion of counsel is provided stating that such transfer is not in
        violation of any Applicable Laws, may be stamped on the certificates
        representing such Common Shares in order to assure an exemption from
        registration. The Plan Administrator also may require such other
        documentation as may from time to time be necessary to comply with
        applicable securities laws. THE CORPORATION HAS NO OBLIGATION TO
        UNDERTAKE REGISTRATION OF OPTIONS OR THE COMMON SHARES ISSUABLE UPON THE
        EXERCISE OF OPTIONS.
	The Holder shall pay to the Corporation by certified or cashier's
        check, promptly upon exercise of an Option or, if later, the date that
        the amount of such obligations becomes determinable, all applicable
        federal, state, local and foreign withholding taxes that the Plan
        Administrator, in its discretion, determines to result upon exercise of
        an Option or from a transfer or other disposition of Common Shares
        acquired upon exercise of an Option or otherwise related to an Option or
        Common Shares acquired in connection with an Option. Upon approval of
        the Plan Administrator, a Holder may satisfy such obligation by
        complying with one or more of the following alternatives selected by the
        Plan Administrator:

  

-7-

         

      	by executing appropriate loan documents approved by the Plan
          Administrator by which the Holder borrows funds from the Corporation
          to pay any withholding taxes due under (iii) above in this section,
          with such repayment terms as the Plan Administrator shall select; or
	by complying with any other payment mechanism approved by the Plan
          Administrator from time to time.

      

    
  

    
      	The issuance, transfer or delivery of certificates representing
          Common Shares pursuant to the exercise of Options may be delayed, at
          the discretion of the Plan Administrator, until the Plan Administrator
          is satisfied that the applicable requirements of all Applicable Laws
          and the withholding provisions of the Code have been met and that the
          Holder has paid or otherwise satisfied any withholding tax obligation
          as described in (iii) above.

    

  

  	Adjustments Upon Changes In Capitalization

	
    The aggregate number and class of shares for which Options may be granted
    under this Plan, the number and class of shares covered by each outstanding
    Option, and the exercise price per share thereof (but not the total price),
    and each such Option, shall all be proportionately adjusted for any increase
    or decrease in the number of issued Common Shares of the Corporation
    resulting from:

    
      	a subdivision or consolidation of shares or any like capital
          adjustment, or
	the issuance of any Common Shares, or securities exchangeable for or
          convertible into Common Shares, to the holders of all or substantially
          all of the outstanding Common Shares by way of a stock dividend (other
          than the issue of Common Shares, or securities exchangeable for or
          convertible into Common Shares, to holders of Common Shares pursuant
          to their exercise of options to receive dividends in the form of
          Common Shares, or securities convertible into Common Shares, in lieu
          of dividends paid in the ordinary course on the Common Shares).

    

  

	Except as provided in (iii) of this section hereof, upon a merger (other
      than a merger of the Corporation in which the holders of Common Shares
      immediately prior to the merger have the same proportionate ownership of
      common shares in the surviving corporation immediately after the merger),
      consolidation, acquisition of property or stock, separation,
      reorganization (other than a mere re-incorporation or the creation of a
      holding Corporation) or liquidation of the Corporation, as a result of
      which the shareholders of the Corporation, receive cash, shares or other
      property in exchange for or in connection with their Common Shares, any
      Option granted hereunder shall terminate, but the Holder shall have the
      right to exercise such Holder's vested Option immediately prior to any
      such merger, consolidation, acquisition of property or shares, separation,
      reorganization or liquidation, and to be treated as a shareholder of
      record for the purposes thereof, to the extent the vesting requirements
      set forth in the Option agreement have been satisfied.
	If the shareholders of the Corporation receive shares in the capital of
      another corporation ("Exchange Shares") in exchange for their
      Common Shares in any transaction involving a merger (other than a merger
      of the Corporation in which the holders of Common Shares immediately prior
      to the merger have the same proportionate ownership of Common Shares in
      the surviving corporation immediately after the merger), consolidation,
      acquisition of property or shares, separation or reorganization (other
      than a mere re-incorporation or the creation of a holding Corporation),
      all Options granted hereunder shall be converted into options to purchase
      Exchange Shares unless the Corporation and the corporation issuing the
      Exchange Shares, in their sole discretion, determine that any or all such
      Options granted hereunder shall not be converted into options to purchase
      Exchange Shares but instead shall terminate in accordance with, and
      subject to the Holder's right to exercise the Holder's Options pursuant
      to, the provisions of (ii) of this section. The amount and price of
      converted options shall be determined by adjusting the amount and price of
      the Options granted hereunder in the same proportion as used for
      determining the number of Exchange Shares the holders of the Common Shares
      receive in such merger, consolidation, acquisition or property or stock,
      separation or reorganization. Unless accelerated by the Board, the vesting
      schedule set forth in the option agreement shall continue to apply to the
      options granted for the Exchange Shares.

-8-

	In the event of any adjustment in the number of Common Shares covered by
      any Option, any fractional shares resulting from such adjustment shall be
      disregarded and each such Option shall cover only the number of full
      shares resulting from such adjustment.
	All adjustments pursuant to this section shall be made by the Plan
      Administrator, and its determination as to what adjustments shall be made,
      and the extent thereof, shall be final, binding and conclusive.
	The grant of an Option shall not affect in any way the right or power of
      the Corporation to make adjustments, reclassifications, reorganizations or
      changes of its capital or business structure, to merge, consolidate or
      dissolve, to liquidate or to sell or transfer all or any part of its
      business or assets.

6. EFFECTIVE DATE; AMENDMENT; SHAREHOLDER APPROVAL

	Options may be granted by the Plan Administrator from time to time on or
  after the date on which this Plan is adopted by the Board (the "Effective
  Date").
	Unless sooner terminated by the Board, this Plan shall terminate on the
  tenth anniversary of the Effective Date. No Option may be granted after such
  termination or during any suspension of this Plan.
	Any Incentive Stock Options granted by the Plan Administrator prior to the
  ratification of this Plan by the shareholders of the Corporation shall be
  granted subject to approval of this Plan by the holders of a majority of the
  Corporation's outstanding voting shares within twelve (12) months before or
  after the Effective Date. If such shareholder approval is sought and not
  obtained, all such Incentive Stock Options granted prior thereto and
  thereafter shall be considered Non-Qualified Stock Options and any such
  Incentive Stock Options granted to Covered Employees will not be eligible for
  the exclusion set forth in Section 162(m) of the Code with respect to the
  deductibility by the Corporation of certain compensation.

7. NO OBLIGATIONS TO EXERCISE OPTION

The grant of an Option shall impose no obligation upon the Optionee to
exercise such Option.

8. NO RIGHT TO OPTIONS OR TO EMPLOYMENT

Whether or not any Options are to be granted under this Plan shall be
exclusively within the discretion of the Plan Administrator, and nothing
contained in this Plan shall be construed as giving any person any right to
participate under this Plan. The grant of an Option shall in no way constitute
any form of agreement or understanding binding on the Corporation or any Related
Corporation, express or implied, that the Corporation or any Related Corporation
will employ or contract with an Optionee for any length of time, nor shall it
interfere in any way with the Corporation's or, where applicable, a Related
Corporation's right to terminate Optionee's employment at any time, which right
is hereby reserved.

-9-

9. APPLICATION OF FUNDS

The proceeds received by the Corporation from the sale of Common Shares
issued upon the exercise of Options shall be used for general corporate
purposes, unless otherwise directed by the Board.

10. INDEMNIFICATION OF PLAN ADMINISTRATOR

In addition to all other rights of indemnification they may have as members
of the Board, members of the Plan Administrator shall be indemnified by the
Corporation for all reasonable expenses and liabilities of any type or nature,
including attorneys' fees, incurred in connection with any action, suit or
proceeding to which they or any of them are a party by reason of, or in
connection with, this Plan or any Option granted under this Plan, and against
all amounts paid by them in settlement thereof (provided that such settlement is
approved by independent legal counsel selected by the Corporation), except to
the extent that such expenses relate to matters for which it is adjudged that
such Plan Administrator member is liable for willful misconduct; provided, that
within fifteen (15) days after the institution of any such action, suit or
proceeding, the Plan Administrator member involved therein shall, in writing,
notify the Corporation of such action, suit or proceeding, so that the
Corporation may have the opportunity to make appropriate arrangements to
prosecute or defend the same.

11. AMENDMENT OF PLAN

The Plan Administrator may, at any time, modify, amend or terminate this Plan
or modify or amend Options granted under this Plan, including, without
limitation, such modifications or amendments as are necessary to maintain
compliance with the Applicable Laws. The Plan Administrator may condition the
effectiveness of any such amendment on the receipt of shareholder approval at
such time and in such manner as the Plan Administrator may consider necessary
for the Corporation to comply with or to avail the Corporation and/or the
Optionees of the benefits of any securities, tax, market listing or other
administrative or regulatory requirements.

Effective Date: January 22, 2004

-10-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00094-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00094-of-00352.parquet"}]]