Document:

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                                                                   Exhibit 10.11

                               NANODYNAMICS, INC.

                              CONSULTING AGREEMENT

     THIS CONSULTING AGREEMENT, effective as of May 1, 2007, is made by and
between Allan Rothstein, an individual residing at 34 Sousa Drive, Sands Point,
New York 11050 ("Consultant") and NanoDynamics, Inc., a Delaware corporation
with its principal place of business at 901 Fuhrmann Boulevard, Buffalo, New
York 14203 (together with its wholly-owned subsidiaries, "Nano").

     1. Services. Consultant shall consult with Nano's Chief Executive Officer
("CEO") and such other members of senior management of Nano as CEO designates
with regard to various transactions in which Nano may be involved, such as
product or technology licensing arrangements, research and development
sponsorships, mergers, acquisitions, joint ventures and any other transaction
reasonably requested and specifically identified in writing by Nano (a
"Transaction"). Consultant will advise and assist Nano in the course of its
negotiation of any Transaction(s) and, if requested by Nano, will participate
directly in such negotiations.  The services to be performed by Consultant in
accordance with this Agreement are referred to herein as the "Consulting
Services."

     2. Term. The term of this Agreement shall continue until March 31, 2010
(the "Initial Term") and shall automatically renew for successive one-year
periods (each, a "Renewal Term") unless written notice of non-renewal is given
by either party not less than sixty (60) days' prior to the expiration of the
Initial Term or any Renewal Term, as applicable. As used herein, "Term" shall
mean the period commencing on the date hereof and ending on the date this
Agreement terminates in accordance with the provisions of this paragraph or
paragraph 3 below.

     3. Termination.

          a. Consultant may terminate this Agreement upon sixty (60) days' prior
written notice to Nano.

          b. Nano may terminate this Agreement upon (i) the death or Disability
of Consultant or (ii) for Cause. "Disability" shall mean the inability or
failure of Consultant to provide Consulting Services for any sixty (60)
continuous days or for a total of one hundred-twenty (120) days during any one
year period of the Term. "Cause" shall mean Consultant has been found by Nano's
Board of Directors (the "Board") to have (i) committed fraud or gross negligence
in connection with the Consulting Services or otherwise with respect to the
business and affairs of Nano; (ii) engaged in misconduct with respect to the
business and affairs of the Company with actual knowledge that such actions
violate legal directions and instructions of the Board consistent with this
Agreement; or (iii) been found by a court of competent jurisdiction to have
committed or plead guilty to an unlawful act whether or not related to the
business of Nano if the commission of such act has a material adverse effect
either on (a) Consultant's ability to perform the Consulting Services or (b)
Nano's reputation and goodwill. Cause shall be found only after Consultant has
received notice from the Board, has had an opportunity to

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discuss the issues with the Board and has been given a thirty (30) day period
to cure, where cure is feasible

          c. In the event this Agreement is terminated by Nano other than for
Disability or Cause, Nano shall continue to make the payments required by
paragraphs 4(a), 4(c) and 4(d) below with respect to the balance of the Initial
Term or any Renewal Term, as applicable. In the event of termination because of
Consultant's death, Nano shall continue to make the payments required by
paragraph 4(a) for the lesser of six (6) months or the balance of the Initial
Term or any Renewal Term, as applicable.

     4. Compensation and Expenses. In consideration of Consultant's performance
of the Consulting Services, Term Consultant shall be entitled to the following:

          a. Nano shall pay Consultant a monthly cash fee of $13,500, payable in
quarterly installments.

          b. Nano will reimburse Consultant on a monthly basis for any
reasonable and necessary expenses incurred by Consultant in connection with the
execution of the Consulting Services, including all travel expenses incurred to
and from all work sites, business related meal expenses, administrative
expenses, lodging expenses (if work demands overnight stays) and other
miscellaneous travel-related expenses (parking and tolls), provided that
expenditures in excess of $1,000 must be pre-approved by Nano.

          c. Nano will continue to make all lease payments for the offices at 98
Cuttermill Road, Suite 370, Great Neck, New York 11021 until the expiration of
the lease on or about February 28, 2010. During such period, Nano shall provide
Consultant with use of such space on a basis substantially equivalent to the use
of such space during the period in which Consultant served as Nano's Chairman of
the Board.

          d. In the event a Transaction with respect to which Consultant has
performed Consulting Services is completed with twelve (12) months following the
Term, Nano shall pay Consultant a fee (the "Transaction Fee") equal to (i) 5% of
the first $1,000,000 of the consideration paid in such transaction; (ii) 4% of
the second $1,000,000 of the consideration paid in such transaction; (iii) 3% of
the next $1,000,000 of the consideration paid in such transaction; (iv) 2% of
the next $1,000,000 of the consideration paid in such transaction; and (v) 1% of
any consideration in excess of $5,000,000. The Transaction Fee shall be paid to
Consultant within two (2) business days following the closing of the
Transaction, except with respect to any portion of the Transaction consideration
that is payable in installments where the Transaction Fee payments shall be made
to Consultant at the same time. Notwithstanding the foregoing, Nano shall not be
obligated to pay any Transaction Fee with respect to a Transaction completed
after the Term if this Agreement was terminated by Nano for Cause.

     5. Confidential Information. Consultant recognizes and acknowledges that
the technology, product candidates, development and business plans,
etc.("Confidential Information") possessed by Nano or otherwise under Nano's
control are valuable property rights

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to be kept confidential and secret, and therefore agrees to keep confidential
and not disclose or use (except in connection with the fulfillment of the
Consulting Services under this Agreement) any Confidential Information.
Confidential Information shall not include information that: (a) is now or
subsequently becomes generally available to the public through no wrongful act
or omission of Consultant or anyone to whom Consultant disclosed such
information; (b) Consultant can demonstrate by its written records to have had
rightfully in its possession prior to disclosure to Consultant by Nano; (c) can
be demonstrated by Consultant's written records to have been independently
developed by the Consultant without use, directly or indirectly, of any
Confidential Information; or (d) the Consultant rightfully obtains from a third
party who has the right to transfer or disclose it.

     6. Nondisclosure. Except as has been specifically authorized by Nano in
writing, Consultant shall not reproduce, use, distribute, disclose or otherwise
disseminate the Confidential Information and shall not take any action causing,
or fail to take any reasonable action necessary to prevent any Confidential
Information disclosed to Consultant to lose its character as Confidential
Information. Consultant shall use the Confidential Information solely for the
purpose of providing consulting services to Nano under this Agreement.
Consultant shall not remove Confidential Information from Nano or the
location(s) designated by Nano except as expressly permitted in writing by Nano.

     7. Return of Information. Upon termination of this Agreement or earlier
upon request by Nano, Consultant shall promptly deliver to Nano all Confidential
Information and all embodiments thereof then in its custody, control or
possession.

     8. Representation of Consultant. Consultant hereby represents that there
are no binding agreements to which the Consultant is a party or by which
Consultant is bound, forbidding or restricting his/her activities herein. In
addition, the Consultant consents to being named as a Consultant in various
reports, brochures or other documents produced by or on behalf of Nano,
including any and all documents filed with the Securities and Exchange
Commission.

     9. Ownership of Inventions. In consideration for the compensation paid to
Consultant by Nano in paragraph 4, Consultant hereby assigns to Nano all right,
title and interest in all inventions which arise from consulting activities for
Nano hereunder, and agrees to cooperate fully in the prosecution of any patent
application resulting from any such invention, at the expense of Nano, which
cooperation shall include executing any necessary documents in connection
therewith.

     10. Independent Contractor. Consultant shall be deemed at all times to be
an independent contractor and shall be wholly responsible for the manner in
which he/she performs the services required of him/her by the terms of this
Agreement.  Nothing contained in this Agreement shall be construed as creating
the relationship of employer and employee between Consultant and Nano.

     11. Liability; Indemnification. Consultant shall not be liable to Nano, or
to anyone who may claim any right due to any relationship with Nano, for any
acts or omissions in the performance of the Consulting Services, except when
said acts or omissions arise from Consultant's willful misconduct or gross
negligence. Nano shall indemnify and hold Consultant

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free and harmless from any obligations, costs, claims, judgments, attorneys'
fees, and attachments arising from or in any way connected with the Consulting
Services, except when the same shall arise from Consultant's willful misconduct
or gross negligence as adjudicated by a court of competent jurisdiction.

     12. Assignment. It is understood and agreed that the services to be
performed by the Consultant under this Agreement are personal in character and
neither this Agreement nor any duties or obligations hereunder shall be assigned
or delegated by Consultant without prior approval by Nano.

     13. Agency. The parties do not intend that any agency, license or
partnership relationship be created between them by this Agreement.

     14. Governing Law; Consent to Jurisdiction. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York.

     15. Arbitration. Any dispute relating to this Agreement shall be submitted
to and decided by the American Arbitration Association in accordance with the
rules of the American Arbitration Association.

     16. Notices. All notices to be given by the parties hereto shall be in
writing and served either by personal delivery or by depositing same in the
United States mail, postage prepaid, and addressed to the parties as indicated
in the beginning of this Agreement.

     17. Severability. If any term or provision of this Agreement shall be found
to be illegal or unenforceable by a court of competent jurisdiction, the
remaining provisions will nevertheless continue in full force and effect without
being impaired or invalidated in any way.

     18. Survival. The provisions of this Agreement relating to confidentiality,
assignment of inventions, and cooperation during patent prosecution shall
survive any termination or expiration hereof.

     19. Entire Agreement. This Agreement constitutes the entire agreement
between the parties regarding the subject matters set forth herein and
supersedes any and all prior and contemporaneous agreements, representations,
and understandings of the parties, whether written or oral, regarding such
matters.  This Agreement may not be changed, modified, amended or supplemented
except by written instrument signed by both parties.

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

NANODYNAMICS, INC.                  CONSULTANT

By: /s/ Keith A. Blakely            /s/ Allan Rothstein
    --------------------            ---------------------------
Name:   Keith A. Blakely            Allan Rothstein
Title:  Chief Executive Officer

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                                                                   Exhibit 10.12

                               NANODYNAMICS, INC.

                             2004 STOCK OPTION PLAN

                           (AS AMENDED THROUGH 3/1/07)

I.   ESTABLISHMENT OF PLAN; DEFINITIONS

          1. Purpose. The purpose of this NanoDynamics, Inc. 2004 Stock Option
Plan is to provide an incentive to key Employees and non-Employee Directors of,
and Consultants and other independent advisors to, NanoDynamics, Inc., a
Delaware corporation (the "Company") or any of its Affiliates, who are in a
position to contribute materially to the long-term success of the Company, to
increase their interest in the welfare of the Company and its Affiliates and to
aid in attracting and retaining Employees, Directors and Consultants of
outstanding ability.

          2. Definitions. Unless the context clearly indicates otherwise, the
following terms shall have the meanings set forth below:

          "Affiliate" shall mean any "subsidiary" (as defined in Section 424(f)
     of the Code) or "parent" (as defined in Section 424(e) of the Code) of the
     Company.

          "Board" shall mean the Board of Directors of the Company.

          "Cause" shall mean (i) for a Grantee who is a party to an employment
     or consulting agreement with the Company or an Affiliate which agreement
     provides for a definition of "Cause" therein, "Cause" shall have the same
     meaning as provided for in such agreement, or (ii) for a Grantee who is not
     a party to such an agreement, "Cause" shall mean repeated failure to
     properly perform assigned duties (after written notice of at least one such
     failure had previously been communicated to the Grantee by the Company),
     gross negligence, commission of a felony or any act materially injurious to
     the Company or an Affiliate involving dishonesty or breach of any duty of
     confidentiality or loyalty.

          "Change of Control" shall mean (i) for a Grantee who is a party to an
     employment or consulting agreement with the Company or an Affiliate which
     agreement provides for a definition of "Change of Control" therein, "Change
     of Control" shall have the same meaning as provided for in such agreement,
     or (ii) for a Grantee who is not a party to such an agreement, "Change of
     Control" shall mean the satisfaction of any one or more of the following
     conditions (and the "Change of Control" shall be deemed to have occurred as
     of the first day that any one or more of the following conditions shall
     have been satisfied):

               (a) Any person (as such term is used in paragraphs 13(d) and
     14(d)(2) of the Exchange Act, hereinafter in this definition, "Person"),
     other than the Company or an Affiliate or an employee benefit plan of the
     Company or an Affiliate, becomes the beneficial owner (as defined in Rule
     13d-3 under the Exchange Act), directly or

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                                                       As amended through 3/1/07

     indirectly, of securities of the Company representing more than 50% of the
     combined voting power of the Company's then outstanding securities;

               (b) The Company's stockholders approve a merger, consolidation or
     other business combination (a "Business Combination") other than a Business
     Combination in which holders of common stock of the Company immediately
     prior to the Business Combination have substantially the same proportionate
     ownership of common stock of the surviving corporation immediately after
     the Business Combination as immediately before;

               (c) The Company's stockholders approve either (i) an agreement
     for the sale or disposition of all or substantially all of the Company's
     assets to any entity that is not an Affiliate, or (ii) a plan of complete
     liquidation of the Company; or

               (d) The persons who were members of the Board immediately before
     a tender offer by any Person other than the Company or an Affiliate, or
     before a merger, consolidation or contested election, or before any
     combination of such transactions, cease to constitute a majority of the
     members of the Board as a result of such transaction or transactions.

          "Code" shall mean the Internal Revenue Code of 1986, as it may be
     amended from time to time.

          "Committee" shall mean a committee designated by the Board which
     committee shall administer the Plan as set forth in Section 4 of this
     Article I of the Plan; provided, however, that if no such committee shall
     be so designated, the Board shall serve as the Committee.

          "Company" shall mean NanoDynamics, Inc., a Delaware corporation.

          "Consultant" shall mean any non-Employee consultant or advisor to the
     Company or an Affiliate who has contracted directly with the Company or an
     Affiliate to render bona fide consulting or advisory services thereto.

          "Director" shall mean any individual who is a member of the Board
     and/or a member of the board of directors of an Affiliate, and who is not
     an Employee.

          "Disability" shall mean the inability to engage in any substantial
     gainful activity by reason of any medically determinable physical or mental
     impairment which can be expected to result in death or which has lasted or
     can be expected to last for a continuous period of not less than 12 months,
     all as described in Section 22(e)(3) of the Code.

          "Employee" shall mean any employee, including officers, of the Company
     or an Affiliate.

          "Exchange Act" shall mean the Securities Exchange Act of 1934, as
     amended.

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                                                       As amended through 3/1/07

          "Fair Market Value" shall mean on any date, (i) if the Stock is not
     listed on a national securities exchange or quoted on Nasdaq, the fair
     market value of the Stock on that date as determined by the Board, or (ii)
     if the Stock is listed on a national securities exchange or is quoted on
     Nasdaq, the closing price reported on the composite tape for issues listed
     on such exchange on such date, or the closing price or the average of the
     closing dealer "bid" and "asked" prices for the Stock as quoted on Nasdaq,
     or if no trades shall have been reported for such date, on the next
     preceding date on which there were such trades reported; provided, however,
     that if no quotations shall have been made within the 10 business days
     immediately preceding such date, Fair Market Value shall be determined by
     the Board.

          "Family Member" shall mean, with respect to a Grantee, any child,
     stepchild, grandchild, parent, stepparent, spouse, former spouse, sibling,
     niece, nephew, mother-in-law, father-in-law, brother-in-law or
     sister-in-law, including adoptive relationships, any person sharing the
     Grantee's household (other than a tenant of the Grantee), a trust in which
     such persons have more than 50% of the beneficial interest, a foundation in
     which such persons (or the Grantee) control the management of assets and
     any other entity in which such persons (or the Grantee) own more than 50%
     of the voting interests.

          "Grantee" shall mean an Employee, Director or Consultant who has been
     granted a Stock Option under the Plan.

          "Incentive Stock Option" shall mean a Stock Option granted to an
     Employee pursuant to the Incentive Stock Option provisions set forth in
     Article II of the Plan.

          "Nasdaq" shall mean the National Association of Securities Dealers
     Automated Quotation System.

          "Non-Qualified Stock Option" shall mean a Stock Option granted to an
     Employee, Director or Consultant pursuant to the Non-Qualified Stock Option
     provisions set forth in Article III of the Plan.

          "Option Period" shall mean the term of a Stock Option as fixed by the
     Committee.

          "Plan" shall mean this NanoDynamics, Inc. 2004 Stock Option Plan as
     set forth herein and as amended from time to time.

          "Rule 16b-3" shall mean Rule 16b-3 promulgated by the Securities
     Exchange Commission under Section 16, or any successor rule.

          "Section 16" shall mean Section 16 of the Exchange Act or any
     successor statute. "Shares" shall mean shares of Stock.

          "Stock" shall mean authorized but unissued shares of the Common Stock
     of the Company, par value $.0001 per share, or reacquired shares of the
     Company's Common Stock.

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                                                       As amended through 3/1/07

          "Stock Option" shall mean an option, which shall include a
     Non-Qualified Stock Option and/or Incentive Stock Option, granted pursuant
     to the Plan to purchase shares of Stock.

          "Stock Option Agreement" shall mean the written instrument evidencing
     the grant of one or more Stock Options under the Plan and which shall
     contain the terms and conditions applicable to such grant.

          "Ten Percent Shareholder" shall mean an Employee who at the time an
     Incentive Stock Option is granted thereto owns stock possessing more than
     10% of the total combined voting power of all stock of the Company or of
     any of its Affiliates.

          3. Shares Subject to the Plan. There are hereby reserved for issuance
under the Plan ONE MILLION (1,000,000) Shares. If a Stock Option shall expire
and terminate for any reason, in whole or in part, without being exercised, the
number of Shares as to which such expired or terminated Stock Option shall not
have been exercised may again become available for the grant of new Stock
Options hereunder. No Employee may receive one or more Stock Options in any
calendar year for the purchase of more than ONE HUNDRED THOUSAND (100,000)
Shares. The limitation set forth in the preceding sentence shall be applied in a
manner which shall permit compensation generated in connection with the exercise
of Options to constitute "performance-based" compensation for purposes of
Section 162(m) of the Code, including, but not limited to, counting against such
maximum number of Shares, to the extent required under Section 162(m) of the
Code, any shares subject to Options that are canceled or repriced.

          4. Administration of the Plan. The Plan shall be administered by the
Committee. Subject to the express provisions of the Plan, the Committee shall
have authority to determine the eligibility of Employees, Directors and
Consultants to participate in the Plan, to grant Stock Options under the Plan
and to determine whether Stock Options granted under the Plan to Employees shall
be Non-Qualified Stock Options or Incentive Stock Options, to interpret the
Plan, to prescribe, amend, and rescind rules and regulations relating to the
Plan, to determine the terms and provisions of Stock Option Agreements and to
make all other determinations necessary or advisable for the administration of
the Plan. Any controversy or claim arising out of or related to the Plan shall
be determined unilaterally by and in the sole discretion of the Committee. Any
determination, decision or action of the Committee in connection with the
construction, interpretation, administration, implementation or maintenance of
the Plan shall be final, conclusive and binding upon all Grantees and all
person(s) claiming under or through any Grantees.

          Should the Stock become publicly traded, there shall be 2 Committees
under the Plan. Solely for the purpose of Stock Options granted under the Plan
to (a) Employees and Directors who are subject to Section 16, and/or (b)
Employees who are "covered employees" within the meaning of Section 162(m)(3) of
the Code, a special Committee comprised solely of 2 or more individuals who are
both (i) "non-employee directors" (as such term is defined in Rule 16b-3(b)(3)
promulgated by the Securities and Exchange Commission under the Exchange Act),
and (ii) "outside directors" (as such term is defined in Treasury Regulation
Section 1.162-27(e)(3), shall administer the Plan to satisfy the applicable
requirements of Treasury Regulation Section 1.162

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                                                       As amended through 3/1/07

27(e)(2)(vi) and Rule 16b-3 with respect to such Employees and Directors. For
all other purposes of the Plan, the regular Committee shall administer the Plan.

          Notwithstanding anything contained in this Section 4 to the contrary,
no member of the Committee shall have the authority to render any decision with
respect to his or her participation in or entitlement to benefits under the
Plan.

          5. Amendment or Termination. The Board may, at any time, alter, amend,
suspend, discontinue, or terminate the Plan; provided, however, that no such
action shall adversely affect the right of any Grantee under any Stock Option
previously granted thereto hereunder.

          6. Effective Date of Plan. The Plan shall become effective on January
1, 2004, subject to the approval by the shareholders of the Company.

II.  INCENTIVE STOCK OPTION PROVISIONS

          1. Granting of Incentive Stock Options.

               (a) Solely Employees shall be eligible to receive Incentive Stock
     Options under the Plan.

               (b) When granting an Incentive Stock Option, the Committee shall
     determine the purchase price of the Stock subject thereto, provided that
     the purchase price of each share of Stock subject to an Incentive Stock
     Option shall not be less than 100% of the Fair Market Value of a share of
     the Stock on the date the Incentive Stock Option is granted; and, provided,
     further, that the purchase price of each share of Stock subject to an
     Incentive Stock Option granted to a Ten Percent Shareholder shall not be
     less than 110% of the Fair Market Value of a share of the Stock on the date
     the Incentive Stock Option is granted.

               (c) No Incentive Stock Option shall be exercisable more than 10
     years from the date the Incentive Stock Option was granted; provided,
     however, that an Incentive Stock Option granted to a Ten Percent
     Shareholder shall not be exercisable more than 5 years from the date the
     Incentive Stock Option was granted.

               (d) The Committee shall determine and shall designate from time
     to time those Employees who are to be granted Incentive Stock Options and
     shall specify the number of shares of Stock subject to each Incentive Stock
     Option.

               (e) Notwithstanding any other provision hereof, the aggregate
     Fair Market Value (determined at the time of grant) of the Stock with
     respect to which Incentive Stock Options are exercisable for the first time
     by an Employee during any calendar year (under all such plans of the
     Company and its Affiliates) shall not exceed $100,000.

               (f) The Committee, in its sole discretion, shall determine
     whether any particular Incentive Stock Option shall become exercisable in
     one or more installments,

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                                                       As amended through 3/1/07

     shall specify the installment dates, and, within the limitations herein
     provided, shall determine the total period during which the Incentive Stock
     Option shall be exercisable. Further, the Committee may make such other
     provisions as may be generally acceptable or desirable in the opinion of
     the Committee or necessary to qualify the grants of Incentive Stock Options
     under the requirements of Section 422 of the Code.

               (g) The Committee may grant at any time new Incentive Stock
     Options to an Employee who has previously received Incentive Stock Options
     or other Stock Options, whether such prior Incentive Stock Options or other
     Stock Options are then outstanding, have previously been exercised in whole
     or in part or are canceled in connection with the issuance of new Incentive
     Stock Options.

          2. Exercise of Incentive Stock Options. The purchase price of Stock
subject to an Incentive Stock Option shall be payable upon its exercise in cash
or by certified check, bank draft or postal or express money order. In addition,
the Committee, in its discretion, may permit a Grantee to make partial or full
payment of the purchase price by utilization of a "cashless exercise" or any
other method made available by the Committee.

          3. Termination of Employment. Except as provided otherwise in the
applicable Stock Option Agreement (in which case the provisions of the Stock
Option Agreement shall control over the provisions of this Section 3):

               (a) Except as provided in paragraphs (b) and (c) below, if a
     Grantee's employment with the Company or Affiliate is terminated other than
     by the Company or Affiliate for Cause, only those Incentive Stock Options
     held by the Grantee which were immediately exercisable at the termination
     of the Grantee's employment shall be exercisable by the Grantee following
     the termination of the Grantee's employment. Such Incentive Stock Options
     must be exercised within 30 days following such termination of employment
     (but in no event after expiration of the Option Period) or they shall be
     forfeited.

               (b) Notwithstanding anything to the contrary contained in
     paragraph (a) above, if a Grantee's employment with the Company or
     Affiliate is terminated by the Company or Affiliate for Cause, all then
     outstanding Incentive Stock Options held by the Grantee shall expire
     immediately and such Incentive Stock Options shall not be exercisable after
     the termination of the Grantee's employment.

               (c) Notwithstanding anything to the contrary contained in
     paragraphs (a) and (b) above, if a Grantee's employment with the Company or
     an Affiliate is terminated on account of the Grantee's death or Disability,
     only those Incentive Stock Options held by the Grantee which were
     immediately exercisable at the date of the Grantee's death or Disability,
     as applicable, shall be exercisable by the Grantee, the representative of
     the Grantee's estate or the Grantee's beneficiaries to whom the Incentive
     Stock Options have been transferred. Such Incentive Stock Options must be
     exercised by the earlier of (i) 6 months from the date of the Grantee's
     death or Disability, as applicable, or (ii) the expiration of the Option
     Period, or they shall be forfeited.

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                                                       As amended through 3/1/07

          4. Failure to Satisfy ISO Requirements. Any Incentive Stock Option
granted to an Employee under the Plan which does not satisfy the applicable
requirements of Section 422 of the Code shall thereupon automatically, to the
extent of such failure, be deemed to be a Non-Qualified Stock Option for all
purposes of the Plan.

III. NON-QUALIFIED STOCK OPTION PROVISIONS.

          1. Granting of Non-Qualified Stock Options.

               (a) Employees, Directors and Consultants shall be eligible to
     receive Non-Qualified Stock Options under the Plan.

               (b) The Committee shall determine and shall designate from time
     to time those Employees, Directors and/or Consultants who are to be granted
     Non-Qualified Stock Options and shall specify the number of shares of Stock
     subject to each Non-Qualified Stock Option.

               (c) The Committee may grant at any time new Non-Qualified Stock
     Options to an Employee, Director or Consultant who has previously received
     Non-Qualified Stock Options or other Stock Options, whether such prior
     Non-Qualified Stock Options or other Stock Options are then outstanding,
     have previously been exercised in whole or in part or are canceled in
     connection with the issuance of new Non-Qualified Stock Options.

               (d) When granting a Non-Qualified Stock Option, the Committee
     shall determine the purchase price of the Stock subject thereto.

               (e) The Committee, in its sole discretion, shall determine
     whether any particular Non-Qualified Stock Option shall become exercisable
     in one or more installments, specify the installment dates and, within the
     limitations herein provided, determine the total period during which the
     Non-Qualified Stock Option shall be exercisable. Further, the Committee may
     make such other provisions as may be generally acceptable or desirable in
     the opinion of the Committee.

          2. Exercise of Non-Qualified Stock Options. The purchase price of
Stock subject to a Non-Qualified Stock Option shall be payable upon its exercise
in cash or by certified check, bank draft or postal or express money order. In
addition, the Committee, in its discretion, may permit a Grantee to make partial
or full payment of the purchase price by utilization of a "cashless exercise" or
any other method made available by the Committee.

          3. Termination of Employment, Director Status or Consulting
Engagement. Except as provided otherwise in the applicable Stock Option
Agreement (in which case the provisions of the Stock Option Agreement shall
control over the provisions of this Section 3):

               (a) Except as provided in paragraphs (b) and (c) below, if the
     employment with the Company or an Affiliate of a Grantee who is an Employee
     is terminated other than by the Company or Affiliate for Cause, only those
     Non-Qualified Stock Options held by the Grantee which were immediately
     exercisable at the termination

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                                                       As amended through 3/1/07

     of the Grantee's employment shall be exercisable by the Grantee following
     the termination of the Grantee's employment. Such Non-Qualified Stock
     Options must be exercised within 30 days following such termination of
     employment (but in no event after expiration of the Option Period) or they
     shall be forfeited.

               (b) Notwithstanding anything to the contrary contained in
     paragraph (a) above, if the employment with the Company or an Affiliate of
     a Grantee who is an Employee is terminated by the Company or Affiliate for
     Cause, all then outstanding Non-Qualified Stock Options held by the Grantee
     shall expire immediately and such Non-Qualified Stock Options shall not be
     exercisable after the termination of the Grantee's employment.

               (c) Notwithstanding anything to the contrary contained in
     paragraphs (a) and (b) above, if the employment with the Company or an
     Affiliate of a Grantee who is an Employee is terminated on account of the
     Grantee's death or Disability, only those Stock Options held by the Grantee
     which were immediately exercisable at the date of the Grantee's death or
     Disability, as applicable, shall be exercisable by the Grantee, the
     representative of the Grantee's estate or the Grantee's beneficiaries to
     whom the Non-Qualified Stock Options have been transferred. Such
     Non-Qualified Stock Options must be exercised by the earlier of (i) 6
     months from the date of the Grantee's death or Disability, as applicable,
     or (ii) the expiration of the Option Period, or they shall be forfeited.

               (d) If a Grantee's status as a Director or engagement as a
     Consultant shall terminate other than by the Company or Affiliate for
     Cause, without such Grantee thereupon becoming an Employee, only those
     Non-Qualified Stock Options held by the Grantee which were immediately
     exercisable at the termination of the Grantee's status as a Director or
     engagement as a Consultant, as applicable, shall be exercisable by the
     Grantee following such termination. Such Non-Qualified Stock Options must
     be exercised within 30 days after such termination (but in no event after
     expiration of the Option Period) or they shall be forfeited.
     Notwithstanding the foregoing, if a Grantee's status as a Director or
     engagement as a Consultant shall terminate for Cause, all then outstanding
     Non-Qualified Stock Options held by the Grantee shall expire immediately
     and such Non-Qualified Stock Options shall not be exercisable after the
     termination of the Grantee's status as a Director or engagement as a
     Consultant.

IV.  SPECIAL RULES.

          1. Right of First Refusal. Solely during such time that the Stock is
not publicly traded, no Grantee (or beneficiary of a Grantee including but not
limited to the Grantee's estate) may sell or otherwise transfer (except for
inter vivos transfers to immediate family members pursuant to paragraph 2(d) of
Section V) any Stock obtained thereby pursuant to the exercise of a Stock Option
hereunder without first (a) providing the Company with a written offer to sell
the Stock to the Company on the same terms as were offered to the Grantee (or
the Grantee's beneficiary) by a third party (a copy of which third party offer
shall be attached to the Grantee's or beneficiary's offer to sell such Stock to
the Company) for a sales price equal to that stated in the third party's
purchase offer, and (b) waiting 30 days from the date of the Company's

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                                                       As amended through 3/1/07

receipt of such offer. If the Company shall accept the Grantee's or
beneficiary's offer in writing within said 30 day period, the Grantee or
beneficiary and the Company shall promptly effect such transaction. If the
Company does not provide a written acceptance of the Grantee's or beneficiary's
offer within said 30 day period, the Grantee or beneficiary shall be entitled to
accept such third party's offer and effect such transaction.

V.   GENERAL PROVISIONS.

          1. Recapitalization Adjustments.

               (a) In the event of any change in capitalization affecting the
     Stock, including, without limitation, a stock dividend or other
     distribution, stock split, reverse stock split, recapitalization,
     consolidation, subdivision, split-up, spin-off, split-off, combination or
     exchange of shares or other form of reorganization or recapitalization, or
     any other change affecting the Stock, the Board shall authorize and make
     such proportionate adjustments, if any, as the Board shall deem appropriate
     to reflect such change, including, without limitation, with respect to the
     aggregate number of shares of Stock for which Stock Options in respect
     thereof may be granted under the Plan, the number of shares of Stock
     covered by each outstanding Stock Option, and the purchase price per share
     of Stock in respect of outstanding Stock Options.

               (b) Any provision hereof to the contrary notwithstanding, in the
     event the Company is a party to a merger or other reorganization, the Board
     shall determine the treatment of outstanding Stock Options, which treatment
     may include the assumption of outstanding Stock Options by the surviving
     company or its parent, their continuation by the Company (if the Company is
     the surviving company), accelerated vesting and/or accelerated expiration,
     or settlement in cash.

          2. General.

               (a) Each Stock Option shall be evidenced by a Stock Option
     Agreement which Agreement shall require the Grantee to enter into and be
     bound by the terms of the Company's Shareholders' Agreement, if any.

               (b) The granting of a Stock Option in any year shall not give the
     Grantee any right to similar grants in future years or any right to be
     retained as an Employee, Director or Consultant, and all Grantees shall
     remain subject to discharge or removal to the same extent as if the Plan
     were not in effect.

               (c) No Grantee, and no beneficiary or other person claiming under
     or through him, shall have any right, title or interest by reason of any
     Stock Option to any particular assets of the Company, or any shares of
     Stock allocated or reserved for the purposes of the Plan or subject to any
     Stock Option except as set forth herein.

               (d) No Stock Option shall or may be sold, exchanged, assigned,
     pledged, encumbered, or otherwise hypothecated or disposed of except by
     will or the laws of descent and distribution, and a Stock Option shall be
     exercisable during the Grantee's lifetime solely by the Grantee or his
     conservator. Notwithstanding the

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                                                       As amended through 3/1/07

     immediately preceding sentence, a Non-Qualified Stock Option may be
     transferred by the Grantee as an inter vivos gift to a Family Member.

               (e) Notwithstanding any other provision of the Plan or agreements
     made pursuant thereto, the Company's obligation to issue or deliver any
     certificate or certificates for shares of Stock under a Stock Option, and
     the transferability of Stock acquired by exercise of a Stock Option, shall
     be subject to all of the following conditions:

                    (i) Any registration or other qualification of such shares
               under any state or federal law or regulation, or the maintaining
               in effect of any such registration or other qualification which
               the Board shall, in its absolute discretion upon the advice of
               counsel, deem necessary or advisable;

                    (ii) The obtaining of any other consent, approval, or permit
               from any state or federal governmental agency which the Board
               shall, in its absolute discretion upon the advice of counsel,
               determine to be necessary or advisable; and

                    (iii) Each stock certificate issued pursuant to a Stock
               Option shall bear such legends which the Company shall determine,
               in its absolute discretion, are necessary or advisable, or which
               in the opinion of counsel to the Company are required under
               applicable federal or state securities laws.

               (f) All payments to Grantees or to their legal representatives
     shall be subject to any applicable tax, community property, or other
     statutes or regulations of the United States or of any state having
     jurisdiction thereof. If the Grantee is an Employee, the Grantee may be
     required to pay to the Company the amount of any withholding taxes which
     the Committee, in its sole discretion, deems necessary to be withheld in
     order to comply with any applicable statutes or regulations with respect to
     a Stock Option or its exercise. In the event that such payment is not made
     when due, the Company shall have the right to deduct, to the extent
     permitted by law, from any payment or settlement of any kind otherwise due
     to such person, all or part of the amount required to be withheld. The
     Company shall not be required to issue Stock pursuant to the exercise of a
     Stock Option until such applicable obligations, if any, shall have been
     satisfied.

               (g) The Company shall issue any Stock certificates required to be
     issued in connection with the exercise of a Stock Option with reasonable
     promptness following such exercise.

               (h) The Plan and the grant or exercise of Stock Options granted
     under the Plan shall be subject to, and shall in all respects comply with,
     the applicable laws of Delaware.

               (i) Should the participation of any Employee or Director in the
     Plan be subject to Section 16, it is the express intent of the Company that
     the Plan and the Stock Options granted under the Plan satisfy and be
     interpreted in a manner to achieve

                                       10

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                                                       As amended through 3/1/07

     the result that the applicable requirements of Rule 16b-3 shall be
     satisfied with respect to such Employees and Directors, with the result
     that such Employees and Directors shall be entitled to the benefits of Rule
     16b-3 or other applicable exemptive rules under Section 16. If any
     provision of the Plan or of any Stock Option would otherwise frustrate or
     conflict with the intent of the Company set forth in the immediately
     preceding sentence, to the extent possible, such provision shall be
     interpreted and deemed amended so as to avoid such conflict, and, to the
     extent of any remaining irreconcilable conflict with such intent, the
     provision shall, solely with respect to Employees and Directors subject to
     Section 16, be deemed void.

               (j) It is the express intention of the Company that the Plan and
     the Stock Options granted under the Plan to Employees subject to the
     restrictions contained in Section 162(m) of the Code satisfy and be
     interpreted in a manner to achieve the result that the grant of such Stock
     Options shall constitute "performance-based compensation" for purposes of
     Section 162(m) of the Code. If any provision of the Plan or of any Stock
     Option would otherwise frustrate or conflict with the intent of the Company
     set forth in the immediately preceding sentence, to the extent possible,
     such provision shall be interpreted and deemed amended so as to avoid such
     conflict, and to the extent of any remaining irreconcilable conflict with
     such intent, the provision shall, solely with respect to Employees subject
     to the restrictions contained in Section 162(m) of the Code, be deemed
     void.

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