Document:

SUBSCRIPTION AGREEMENT

                                       for

                               ES BANCSHARES, INC.
                             A MARYLAND CORPORATION

                    COMMON SHARES, PAR VALUE $0.01 PER SHARE

THE COMMON SHARES ("COMMON  SHARES") REFERRED TO HEREIN HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED  ("SECURITIES  ACT"), AND ARE BEING
OFFERED  AND  SOLD  IN  RELIANCE  UPON  AN  EXEMPTION   FROM  THE   REGISTRATION
REQUIREMENTS  OF THE SECURITIES  ACT. THE OFFERING OF COMMON SHARES HAS NOT BEEN
REVIEWED OR APPROVED BY ANY FEDERAL OR STATE  REGULATORY  AUTHORITIES AND IS NOT
REGISTERED UNDER APPLICABLE FEDERAL OR STATE SECURITIES LAWS.

A PURCHASER OF THE COMMON SHARES MUST BE PREPARED TO BEAR THE ECONOMIC  RISKS OF
THE INVESTMENT FOR AN INDEFINITE PERIOD OF TIME BECAUSE THE SHARES HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT AND ARE RESTRICTED AS TO TRANSFERABILITY.

                                       i

<PAGE>

i

                                TABLE OF CONTENTS

Article I  Purchase; Closing..................................................1
         1.1      Purchase....................................................1
         1.2      Closing.....................................................2

Article II  Representations and Warranties....................................3
         2.1      Disclosure..................................................3
         2.2      Representations and Warranties of the Company...............4
         2.3      Representations and Warranties of the Investor..............7

Article III  Covenants........................................................9
         3.1      Commercially Reasonable Efforts.............................9
         3.2      Expenses....................................................9
         3.3      Publicity...................................................9
         3.4      Further Assurances.........................................10

Article IV  Additional Agreements of the Investor............................10
         4.1      Transfer Restrictions......................................10
         4.2      Legend.....................................................10
         4.3      Rule 144 Reporting ........................................11

Article V  Miscellaneous.....................................................11
         5.1      Survival...................................................11
         5.2      Interpretation.............................................11
         5.3      Amendment..................................................12
         5.4      Waiver of Conditions.......................................12
         5.5      Counterparts and Facsimile.................................12
         5.6      Governing Law; Submission to Jurisdiction, Etc.............12
         5.7      Notices....................................................13
         5.8      Entire Agreement, Etc......................................13
         5.9      Definitions of "Subsidiary" and "Affiliate"................13
         5.10     Severability...............................................14
         5.11     No Third Party Beneficiaries...............................14

                                       ii

<PAGE>

                                 LIST OF ANNEXES

Annex A
-------

Accredited Investor Questionnaire

<PAGE>

                             INDEX OF DEFINED TERMS

                                                                   Location of
Term                                                               Definition
-----------------------------------------------------------------  -------------

Affiliate                                                          5.9(b)
Agreement                                                          Preamble
Bankruptcy Exceptions                                              2.2(d)(1)
Closing                                                            1.2(a)
Closing Date                                                       1.2(a)
Common Shares                                                      Recital A
Company                                                            Preamble
Exchange Act                                                       2.1(b)
FDIC                                                               2.2(a)
Federal Reserve                                                    2.2(h)(2)
GAAP                                                               2.1(a)
Governmental Entities                                              2.1(a)
Hedging Transaction                                                4.1(a)
Investor                                                           Preamble
Knowledge                                                          5.2
Material Adverse Effect                                            2.1(a)
Offering                                                           Recital B
Payment                                                            1.1(b)
Previously Disclosed                                               2.1(b)
Purchase                                                           1.1
Purchased Securities                                               Recital B
Register                                                           4.3(h)
Registrable Securities                                             4.3(h)
Registration Expenses                                              4.3(h)
SEC                                                                2.1(b)
SEC Reports                                                        2.1(b)
Securities Act                                                     2.2(a)
Selling Expenses                                                   4.3(h)
Shelf Registration Statement                                       4.3(a)(2)
Significant Subsidiaries                                           2.2(a)
Significant Subsidiary                                             2.2(a)
Stock Option Plan                                                  2.2(b)(4)
Subsidiary                                                         5.9(a)
Transaction Documents                                              Recital B
Transfer                                                           4.1(a)

                                      iii

<PAGE>

     Subscription  Agreement,   dated  December  31,  2009  (together  with  any
attachments,  annexes  or  exhibits  hereto,  collectively,  this  "Agreement"),
between ES Bancshares, Inc., a corporation organized under the laws of the State
of Maryland  (the  "Company"),  and the Investor  listed on the  signature  page
hereof (the "Investor").

                                    Recitals:

     A. The  Company.  As of the date  hereof,  the  Company  has (i)  5,000,000
authorized Common Shares,  par value $0.01 per share (the "Common  Shares"),  of
which 1,996,070 shares are outstanding,  and (ii) 5,000,000 authorized Preferred
Shares, par value $0.01 per share, of which no shares are outstanding.

     B. The  Issuance.  The  Company  intends to issue up to  259,678  shares of
Common  Shares  at a price  of  $5.00  per  share in a  private  placement  (the
"Offering"), and the Investor intends to purchase from the Company the number of
Common  Shares  indicated  on  the  signature  page  hereof  (collectively,  the
"Purchased  Securities").  For purposes of this Agreement, the term "Transaction
Documents"  refers  collectively  to this  Agreement  and any  other  documents,
agreements and instruments  delivered in connection herewith (including prior to
the date hereof),  in each case, as amended,  modified or supplemented from time
to time in accordance with their respective terms.

     NOW,   THEREFORE,   in   consideration   of  the   premises,   and  of  the
representations,  warranties,  covenants and  agreements  set forth herein,  the
parties agree as follows:

                                    Article I

                                Purchase; Closing

     1.1    Purchase.
            --------

             (a)  Subscription.  The Investor hereby  irrevocably  subscribes to
purchase the number of Purchased  Securities  indicated  on the  signature  page
hereof  for a period  of 30 days  from  the  subscription  date,  but in no case
extending  beyond  January  31,  2010,  in  accordance  with  the  terms of this
Subscription  Agreement  (the  "Purchase").  To effect  such  subscription,  the
Investor shall deliver an executed counterpart of this Agreement,  including all
Annexes hereto, to the Company or its authorized representative.

             (b)  Payment.  Together with delivery of an executed counterpart of
this Agreement, including all Annexes hereto, the Investor shall deliver and pay
in full the aggregate purchase price for the Purchased  Securities  specified on
the  signature  page  hereof  (the  "Payment")  in United  States  funds,  to ES
Bancshares,  Inc. in the form of (1) a certified  or bank  cashier's  check,  in
immediately  available  funds,  made payable to "ES Bancshares,  Inc." or (2) an
immediately available wire transfer to the following account:  Empire State Bank
ABA #021913862, for credit to ES Bancshares, Inc. #190001150.

             (c) Acceptance.  This Agreement shall be effective immediately upon
acceptance  by the  Company  of the  Investor's  executed  counterpart  of  this
Agreement and shall  thereupon be binding upon the Company.  Such  acceptance by

                                       1
<PAGE>
the Company shall be evidenced  only by  counter-execution  and delivery of this
Agreement by the Company,  and the Company  shall have no  obligation  hereunder
until the Company  shall have executed and delivered to the Investor an executed
counterpart of this  Agreement.  The Investor  acknowledges  and agrees that the
Company,  in its sole  discretion,  reserves  the right to accept or reject  the
Purchase,  in whole or in part; provided,  however,  that if the Company rejects
the  Purchase  by  notice  to the  Investor,  such  rejection  shall  serve as a
termination of this Agreement,  and the Investor shall have no further rights or
obligations  under  this  Agreement  (but any other  Transaction  Document  that
expires  by its terms as of a  different  date  shall  remain in full  force and
effect).

             (d) Termination.

             (1) This  Agreement  may not be  terminated  by the Investor at any
                 time   following  the   Investor's   delivery  of  an  executed
                 counterpart  of this  Agreement  to the  Company  (even  if the
                 Company has not yet accepted or rejected the Purchase).

             (2) Notwithstanding the foregoing, this Agreement may be terminated
                 by either the Company or the Investor  upon  written  notice to
                 the other if the Closing  shall not have  occurred on or before
                 January 31, 2010.

             (3) In the event of  termination  of this  Agreement as provided in
                 this Section 1.1(c) or (d), (A) this Agreement  shall forthwith
                 become  void,  and there shall be no  liability  on the part of
                 either party hereto,  except that nothing  herein shall relieve
                 either  party from  liability  for any  willful  breach of this
                 Agreement,  and (B)  the  Company  shall  promptly  return  any
                 previously delivered Payment to the Investor, without interest.

     1.2    Closing.
            -------

             (a) On the terms and  subject to the  conditions  set forth in this
Agreement,  the closing of the Purchase (the  "Closing")  will take place at the
offices of special counsel to the Company,  Luse Gorman  Pomerenk & Schick,  PC,
5335 Wisconsin  Avenue,  NW, Suite 780,  Washington,  D.C. 20015, at 10:00 a.m.,
Washington,  D.C.  time,  on  December  31,  2009  or  as  soon  as  practicable
thereafter, but in no event later than January 31, 2010, or at such other place,
time and date as shall be agreed between the Company and the Investor.  The time
and date on which the Closing  occurs is referred  to in this  Agreement  as the
"Closing Date."

             (b) At the  Closing,  the Company  will deliver to the Investor the
Purchased Securities, as evidenced by one or more certificates dated the Closing
Date and bearing appropriate legends as hereinafter  provided for, registered on
the books and records of the Company in such Investor's name.

             (c) The  obligation  of the Investor to  consummate  the Closing is
also subject to the  fulfillment  (or waiver by the Investor) at or prior to the
Closing of the following  condition:  the  representations and warranties of the
Company set forth in this Agreement  shall be true and correct as though made on
and as of the Closing Date (other than  representations  and warranties  that by
their terms speak as of another date, which representations and warranties shall
be true and correct as of such  date),  except to the extent that the failure of

                                       2
<PAGE>

such  representations  and warranties to be so true and correct  (without giving
effect to any qualifiers or exceptions relating to materiality), individually or
in the  aggregate,  does not have and would not reasonably be expected to have a
Material Adverse Effect and (B) the Company shall have performed in all material
respects all obligations  required to be performed by it under this Agreement at
or prior to the Closing.

             (d) The obligation of the Company to consummate the Closing is also
subject to the fulfillment (or waiver by the Company) at or prior to the Closing
of each of the following conditions:

             (1) (A) the  representations  and  warranties  of the  Investor set
                 forth in this  Agreement  shall be true and  correct  as though
                 made on and as of the Closing Date (other than  representations
                 and  warranties  that by their terms speak as of another  date,
                 which  representations and warranties shall be true and correct
                 as of such date), except to the extent that the failure of such
                 representations  and  warranties  to be  so  true  and  correct
                 (without giving effect to any qualifiers or exceptions relating
                 to  materiality  or  Material  Adverse  Effect (as  hereinafter
                 defined)),  individually or in the aggregate, does not have and
                 would not  reasonably  be expected  to have a Material  Adverse
                 Effect  and  (B)  the  Investor  shall  have  performed  in all
                 material  respects all obligations  required to be performed by
                 it under this Agreement at or prior to the Closing; and

             (2) the Company shall have  received a certificate  dated as of the
                 Closing   Date  signed  by  the   Investor  or  an   authorized
                 representative  of  the  Investor  certifying  compliance  with
                 Section 1.2(d)(1).

                                   Article II

                         Representations and Warranties

     2.1    Disclosure.

             (a) "Material  Adverse  Effect" means a material  adverse effect on
(1) the business, results of operation or financial condition of the Company and
its subsidiaries  taken as a whole;  provided that Material Adverse Effect shall
not be deemed to include  the effects of (A) any facts,  circumstances,  events,
changes or occurrences  generally  affecting  businesses and industries in which
the Company operates,  companies engaged in such businesses or industries or the
economy, or the financial or securities markets and credit markets in the United
States  or  elsewhere  in the  world,  including  effects  on  such  businesses,
industries,  economy or  markets  resulting  from any  regulatory  or  political
conditions  or  developments,  or any  outbreak or  escalation  of  hostilities,
declared or undeclared acts of war, terrorism, or work stoppages, (B) changes or
proposed  changes in  generally  accepted  accounting  principles  in the United
States ("GAAP") or regulatory accounting  requirements  applicable to depository
institutions   and  their  holding   companies   generally   (or   authoritative
interpretations  thereof),  (C) changes or proposed changes in banking and other
laws of general  applicability  or related  policies or  interpretations  of all
United   States   governmental   or   regulatory   authorities    (collectively,

                                       3
<PAGE>

"Governmental  Entities"),  or (D) changes in the market price or trading volume
of Common Shares (it being understood and agreed that the exception set forth in
this  clause  (D) does not  apply to the  underlying  reason  giving  rise to or
contributing  to any such change),  or (2) the ability of the Company  timely to
consummate  the  Purchase  and  the  other  transactions   contemplated  by  the
Transaction Documents.

             (b)  "Previously  Disclosed"  means  information  contained  in the
Company's  Annual  Report on Form 10-K for the year ended  December 31, 2008, or
its other reports and forms filed with the  Securities  and Exchange  Commission
(the "SEC") under Sections 13(a), 14(a) or 15(d) of the Securities  Exchange Act
of 1934 (the "Exchange Act") on or after January 1, 2009 (the "SEC Reports") and
prior to the execution and delivery of this Agreement.

             (c)  Each  party  acknowledges  that  it is not  relying  upon  any
representation  or  warranty  not set forth in the  Transaction  Documents.  The
Investor  acknowledges  that it has  conducted  a  review  and  analysis  of the
business,  assets,  condition,  operations  and prospects of the Company and its
subsidiaries,  together with the  representations  and warranties of the Company
set forth in the Transaction Documents,  which the Investor considers sufficient
for purposes of the Purchase.

     2.2     Representations and Warranties of the Company. Except as Previously
Disclosed,  the Company  represents  and warrants to the Investor that as of the
date hereof and the Closing Date (or such other date specified herein):

             (a)  Organization,  Authority  and  Significant  Subsidiaries.  The
Company has been duly  incorporated  and is validly existing as a corporation in
good standing under the laws of the State of Maryland,  with corporate power and
authority  to own its  properties  and  conduct  its  business  in all  material
respects  as  currently  conducted,  and,  except  as has not had or  would  not
reasonably  be  expected  to have a  Material  Adverse  Effect,  has  been  duly
qualified as a foreign  corporation  for the  transaction  of business and is in
good  standing  under the laws of each  other  jurisdiction  in which it owns or
leases properties or conducts any business so as to require such  qualification;
and each  Subsidiary  (as defined in Section  5.10(a)) of the Company  that is a
"significant  subsidiary"  within the meaning of Rule 1-01(w) of Regulation  S-X
under the  Securities  Act of 1933, as amended (the  "Securities  Act") (each, a
"Significant Subsidiary" and, collectively,  the "Significant Subsidiaries") has
been duly  organized and is validly  existing in good standing under the laws of
its jurisdiction of organization. The Company's principal depository institution
Subsidiary is duly organized and validly  existing as a New York State chartered
bank,  and its  deposit  accounts  are  insured up to  applicable  limits by the
Federal Deposit Insurance Corporation (the "FDIC").

             (b) Capitalization.

             (1) As of the date hereof,  the authorized and outstanding  capital
                 stock of the Company is as set forth in Recital A.

             (2) All of the  outstanding  shares of capital stock of the Company
                 have been duly and validly  authorized and issued and are fully
                 paid and non-assessable and were not issued in violation of any

                                       4
<PAGE>
                 preemptive  rights,  resale rights,  rights of first refusal or
                 similar rights.

             (3) All  of  the  outstanding  shares  of  capital  stock  of  each
                 Significant  Subsidiary  have been duly and validly  authorized
                 and  issued,  are fully  paid and  non-assessable  and were not
                 issued in violation of any  preemptive  rights,  resale rights,
                 rights  of first  refusal  or  similar  rights,  and are  owned
                 directly or  indirectly  by the Company,  free and clear of all
                 security interests, liens, encumbrances, equities or claims.

             (4) Except for the options  issued  pursuant to Empire State Bank's
                 (the "Bank") 2004 Stock Option Plan (the "Stock  Option  Plan")
                 and  92,652  warrants  issued  to  organizers  of the  Bank  in
                 connection with the opening of the Bank,  there are no options,
                 warrants  or  other   rights,   agreements,   arrangements   or
                 commitments  to which  the  Company  is a party or by which the
                 Company  is bound  relating  to the issued or  unissued  Common
                 Shares of the Company.

             (c) The Purchased Securities.  The Purchased Securities will be, as
of the Closing Date,  duly authorized by all necessary  corporate  action on the
part  of the  Company  and,  when  issued  and  delivered  as  provided  in this
Agreement,  will be duly and validly issued, fully paid and non-assessable,  and
the issuance thereof will not be subject to any preemptive or similar rights.

             (d)  Authorization  and  Enforceability  of Transaction  Documents.

             (1) The Company has the  corporate  power and  authority to execute
                 and deliver the  Transaction  Documents  to which it is a party
                 and to  carry  out its  obligations  hereunder  and  thereunder
                 (which includes the issuance of the Purchased Securities).  The
                 execution,  delivery  and  performance  by the  Company  of the
                 Transaction   Documents   to  which  it  is  a  party  and  the
                 consummation  of  the  transactions   contemplated  hereby  and
                 thereby have been duly  authorized by all  necessary  corporate
                 action on the part of the Company and its shareholders,  and no
                 further  approval or  authorization  is required on the part of
                 the Company or its shareholders.  The Transaction  Documents to
                 which the  Company is a party are or will be valid and  binding
                 obligations of the Company  enforceable  against the Company in
                 accordance with their respective terms,  except as the same may
                 be    limited    by    applicable    bankruptcy,    insolvency,
                 reorganization,   moratorium  or  similar  laws  affecting  the
                 enforcement   of  creditors'   rights   generally  and  general
                 equitable principles, regardless of whether such enforceability
                 is considered in a proceeding at law or in equity  ("Bankruptcy
                 Exceptions").

             (3) Other than in connection or in compliance  with the  provisions
                 of the  Securities Act and the securities or "blue sky" laws of
                 the various states, to the Company's Knowledge without inquiry,
                 no  notice  to,  filing  with,   exemption  or  review  by,  or
                 authorization,  consent or approval of, any Governmental Entity

                                       5
<PAGE>
                 is required to be made or obtained by the Company in connection
                 with the Purchase and the other  transactions  contemplated  by
                 the Transaction Documents.

             (e)  Company  Financial  Statements.   The  consolidated  financial
statements of the Company and its subsidiaries  (including the related notes and
supporting  schedules)  contained  in the  SEC  Reports  present  fairly  in all
material  respects the  consolidated  financial  position of the Company and its
consolidated subsidiaries as of the dates indicated therein and the consolidated
results of their  operations for the periods  specified  therein;  and except as
stated therein,  such financial statements were prepared in conformity with GAAP
applied on a consistent basis.

             (f) No Material Adverse Effect.  Since September 30, 2009, no fact,
circumstance,  event, change, occurrence,  condition or development has occurred
that, individually or in the aggregate,  has had or would reasonably be expected
to have a Material Adverse Effect.

             (g)  Proceedings.  As of the  date of this  Agreement,  there is no
litigation or similar  proceeding or governmental  proceeding pending or, to the
Company's Knowledge,  threatened to which the Company or any of its subsidiaries
is a party or of which any property of the Company or any of its subsidiaries is
the subject  that the  Company's  management  believes,  individually  or in the
aggregate,  has had or would  reasonably be expected to have a Material  Adverse
Effect.

             (h) Reports.

             (1) Since  December  31,  2008,  the Company  has timely  filed all
                 documents  required  to be  filed  with  the  SEC  pursuant  to
                 Sections 13(a), 14(a) and 15(d) of the Exchange Act.

             (2) Since December 31, 2008, the Company and each  Subsidiary  have
                 filed  all  material  reports,  registrations  and  statements,
                 together  with any  required  amendments  thereto,  that it was
                 required  to file with the Board of  Governors  of the  Federal
                 Reserve System (the "Federal Reserve"),  the FDIC, the New York
                 State Banking  Department and any other  applicable  federal or
                 state  securities  or  banking  authorities,  except  where the
                 failure to file any such  report,  registration  or  statement,
                 individually  or in the  aggregate,  has not had and  would not
                 reasonably be expected to have a Material Adverse Effect. As of
                 their respective  dates, each of the foregoing reports complied
                 with all applicable  rules and  regulations  promulgated by the
                 Federal   Reserve,   the  FDIC,  the  New  York  State  Banking
                 Department and any other applicable  foreign,  federal or state
                 securities or banking  authorities,  as the case may be, except
                 for any failures that,  individually or in the aggregate,  have
                 not had and would not reasonably be expected to have a Material
                 Adverse Effect.

                                       6
<PAGE>

             (i) No General  Solicitation  or General  Advertising.  Neither the
Company  nor any person  acting on its behalf has  engaged or will engage in any
form of general  solicitation  or general  advertising  (within  the  meaning of
Regulation D under the Securities  Act) in connection  with any offer or sale of
the Purchased Securities.

             (j) No  Integration.  The Company has not,  directly or indirectly,
solicited  any offer to buy or offer to sell any Common  Shares in a manner that
would  require the  registration  of the  Purchased  Securities  pursuant to the
Securities Act and has no present intention to solicit any offer to buy or offer
to sell any Purchased  Securities  or any other  securities of the Company other
than  pursuant  to (1) this form of  Subscription  Agreement,  (2) a  registered
public offering of the Purchased  Securities and other Common Shares offered and
sold in the Offering as contemplated  by this form of Subscription  Agreement or
(3) the Company's Stock Option Plan or outstanding warrant agreements.

     2.3  Representations  and Warranties of the Investor.  The Investor  hereby
represents  and  warrants  to the  Company  that as of the date  hereof  and the
Closing Date:

             (a)  Organization  and  Authority.  The  Investor  (1) is a natural
person,  or (2) has been duly organized and is validly existing in good standing
under the laws of the jurisdiction of its organization, with the requisite power
and  authority  to own its  properties  and  conduct its  business as  currently
conducted.

             (b) Authorization and Enforceability of Transaction Documents.  The
Investor  has the  requisite  power and  authority  to execute  and  deliver the
Transaction  Documents  to which it is a party and to carry out its  obligations
hereunder  and  thereunder.  The  execution,  delivery  and  performance  by the
Investor  of  the  Transaction  Documents  to  which  it  is  a  party  and  the
consummation of the transactions  contemplated hereby and thereby have been duly
authorized by all necessary  action on the part of the Investor,  and no further
approval  or  authorization  is  required  on  the  part  of the  Investor.  The
Transaction  Documents to which the Investor is a party are or will be valid and
binding  obligations  of  the  Investor  enforceable  against  the  Investor  in
accordance  with their  respective  terms,  except as the same may be limited by
Bankruptcy Exceptions.

             (c)  Ownership.  Giving effect to the  Purchase,  as of the Closing
Date,  the Investor  and all of its  Affiliates  on an aggregate  basis will not
beneficially  own,  control  or  have  the  power  to  vote  10% or  more of the
outstanding Common Shares. The Investor does not have any agreement, arrangement
or  understanding  with any person  (other than the  Company  and any  Permitted
Transferee (as defined in Section 4.1(b)(1))) to acquire, dispose of or vote any
securities of the Company.

             (d) No Registration;  Purchase for Investment; Accredited Investor;
Sophistication. The Investor:

             (1) understands  that  the  Purchased   Securities  have  not  been
                 registered under the Securities Act and,  therefore,  cannot be
                 resold unless they are  registered  under the Securities Act or

                                       7
<PAGE>
                 (without  limitation on the  restrictions  set forth in Article
                 IV) unless an exemption from registration is available;

             (2) understands  that  the  Company  has no  present  intention  to
                 register  the  resale  of the  Purchased  Securities  under the
                 Securities Act of 1933 and is under no duty to do so;

             (3) understands  that  the  Purchased   Securities  have  not  been
                 registered under any United States state securities laws;

             (4) is acquiring the Purchased  Securities pursuant to an exemption
                 from   registration   under  the   Securities  Act  solely  for
                 investment and not with a view to any resale or transfer of any
                 of the Purchased Securities to any person;

             (5) confirms that it is aware of the transfer  restrictions  on the
                 Purchased  Securities described in Article IV and will not sell
                 or otherwise dispose of any of the Purchased Securities, except
                 in compliance with all of the requirements of Section 4.1;

             (6) confirms that all information that the Investor has provided to
                 the  Company  concerning  the  Investor  in this  Agreement  or
                 otherwise is correct and complete;

             (7) is an Accredited  Investor (as that term is defined in Rule 501
                 under the Securities  Act) and has certified to the Company the
                 basis for qualifying as an Accredited Investor on Annex A;

             (8) has such  knowledge  and  experience  in financial and business
                 matters and in  investments  of this type that it is capable of
                 (A)  evaluating  the  merits and risks of the  Purchase  and of
                 making an  informed  investment  decision  and (B)  bearing the
                 financial  risks of an investment  in the Purchased  Securities
                 for an indefinite period of time;

             (9) has  conducted  a review of the  business  and  affairs  of the
                 Company  and  the  Bank  that  it  considers   sufficient   and
                 reasonable for purposes of making the Purchase;

             (10) has been  provided  the  opportunity  to ask  questions of and
                 receive answers from  representatives of the Company concerning
                 the terms and  conditions  of the  Purchase  and to obtain  any
                 additional  information  that  the  Company  possesses  or  can
                 acquire  without   unreasonable   effort  or  expense  that  is
                 necessary to verify the accuracy of the  information  contained
                 in the SEC Reports;

             (11) has read the SEC Reports carefully, is fully familiar with and
                 understands the contents of the SEC Reports; and

                                       8
<PAGE>

             (12) has not relied on any representation or warranty in connection
                 with the Purchase other than those contained in the Transaction
                 Documents.

             (e) Financial  Capability.  The Investor has or will have available
funds to make the  Purchase  on the terms and  conditions  contemplated  by this
Agreement.

             (f) No Legal,  Tax,  Accounting  or Business  Advice.  The Investor
understands  that neither the Company nor any of its agents has given any legal,
tax,  accounting or business advice  regarding the consequences of the Purchase,
and the Investor has consulted the  Investor's  own legal,  tax,  accounting and
business advisors with respect to the Purchase.

             (g) No General  Solicitation  or General  Advertising.  Neither the
Investor,  any of its Affiliates (as defined in Section  5.10(b)) nor any person
acting  on its or their  behalf,  has made or will  make  offers or sales of the
Purchased  Securities  by means of any form of general  solicitation  or general
advertising (within the meaning of Regulation D under the Securities Act).

             (h) Possible  Dilutive  Effect of Private  Placement.  The Investor
understands that the Company is currently  involved in discussions to sell up to
259,678  shares  of its  common  stock at a price of $5.00 per share to up to 35
investors on a private placement basis. Any such sale may have a dilutive effect
on the  ownership of the  Investor.  There can be no assurance as to whether the
Company will be able to sell any or all of these shares.

             (i)  Confidentiality   Agreement.   The  Investor  understands  and
acknowledges that unless expressly set forth in this Agreement,  nothing in this
Agreement shall supersede the provisions of the Confidentiality Agreement, dated
________ ___, 2009, entered into between the Company and the Investor.

                                   Article III

                                    Covenants

     3.1    Commercially Reasonable Efforts. Subject to the terms and conditions
of  this  Agreement, each of  the  parties will use its  commercially reasonable
efforts in good faith to take, or cause to be taken, all actions, and to do, or
cause to be  done,  all  things  necessary,  proper or  desirable, or  advisable
under applicable  laws, so as to permit consummation of the Purchase as promptly
as practicable and  otherwise  to  enable  consummation   of  the   transactions
contemplated  hereby and shall cooperate fully with the other party to that end,
including  cooperating  in  seeking  to obtain  any  consent,  authorization  or
approval that might be required from Governmental Entities.

     3.2    Expenses. Except to the extent otherwise provided in any Transaction
Document  executed by the Company and the Investor,  each of the parties  hereto
will bear and pay all  costs and  expenses  incurred  by it or on its  behalf in
connection with the transactions  contemplated under the Transaction  Documents,
including  fees  and  expenses  of  its  own  financial  or  other  consultants,
investment bankers, accountants and counsel.

     3.3      Publicity.  No  public release  or  announcement   concerning  the
transactions  contemplated  hereby shall be issued by the  Investor  without the
prior  consent of the Company.  The Company  shall use  commercially  reasonable

                                       9
<PAGE>
efforts to file with the SEC, as promptly as practicable after counter-execution
and  delivery  of this  Agreement  by the  Company,  but no later  than the time
required by SEC Form 8-K, the material  terms of this Agreement and the Offering
if that constitutes material non-public  information with respect to the Company
within the meaning of United States federal securities laws.

     3.4   Further Assurances. Within three days of receipt of a written request
from the Company,  the Investor agrees to provide such  information  relevant to
the Purchase and to execute and deliver such documents as the Company determines
in good faith to be  necessary  or  advisable  to comply  with any and all laws,
regulations and ordinances to which the Company is subject.

                                   Article IV

                      Additional Agreements of the Investor

     4.1    Transfer Restrictions.
            ---------------------

             (a) Restrictions on Transfer.  The Investor shall not,  directly or
indirectly,  transfer,  sell, assign, pledge,  convey,  hypothecate or otherwise
encumber  or  dispose  of, or engage in a Hedging  Transaction  (as  hereinafter
defined)  with  respect  to  (collectively,  "Transfer"),  any of the  Purchased
Securities.  For purposes of this  Agreement,  "Hedging  Transaction"  means any
short sale  (whether or not against the box) or any  purchase,  sale or grant of
any right (including any put or call option) with respect to any security (other
than a broad-based market basket or index) that includes,  relates to or derives
any significant part of its value from the Purchased Securities.

             (b)  Permitted  Transfers.   Notwithstanding  Section  4.1(a),  the
Investor and Permitted  Transferees (as hereinafter  defined) shall be permitted
to Transfer any Purchased Securities:

             (1) at any time a Registration  Statement shall be effective and in
                 compliance with the Securities Act and usable for resale of the
                 Purchased Securities; or

             (2) if  in  compliance  with  Rule  144A  or  Rule  144  under  the
                 Securities Act;  provided that, if the Investor is an Affiliate
                 of the Company or has been an Affiliate  of the Company  during
                 the three months preceding the date of such Transfer,  any such
                 Transfer  shall be subject to  approval  by the  Company in its
                 sole  discretion,  which  approval  may be  conditioned  on the
                 receipt by the Company or its agents or representatives of such
                 information,  documentation,  opinions or  assurances  or other
                 agreements as the Company may determine in its sole  discretion
                 to be necessary or advisable.

     4.2    Legend.  The  Investor  agrees  that  all  certificates   or   other
instruments representing Purchased  Securities will bear a legend  substantially
to the following effect:

                                       10
<PAGE>

"THE SECURITIES  REPRESENTED BY THIS  INSTRUMENT HAVE NOT BEEN REGISTERED  UNDER
THE SECURITIES ACT OF 1933, AS AMENDED,  OR THE SECURITIES LAWS OF ANY STATE AND
MAY  NOT  BE  TRANSFERRED,   SOLD  OR  OTHERWISE  DISPOSED  OF  EXCEPT  WHILE  A
REGISTRATION  STATEMENT  RELATING  THERETO  IS IN  EFFECT  UNDER  SUCH  ACT  AND
APPLICABLE  STATE  SECURITIES LAWS OR AS PERMITTED BY, AND IN ACCORDANCE WITH, A
SUBSCRIPTION  AGREEMENT,  DATED  DECEMBER 31, 2009,  BETWEEN THE ISSUER OF THESE
SECURITIES AND THE INVESTOR REFERRED TO THEREIN, IN A TRANSACTION COMPLYING WITH
RULE 144A OR RULE 144 UNDER SUCH ACT AND AN  EXEMPTION  UNDER  SUCH  LAWS.  THIS
INSTRUMENT IS ISSUED PURSUANT TO AND SUBJECT TO THE RESTRICTIONS ON TRANSFER AND
OTHER PROVISIONS OF THE SUBSCRIPTION  AGREEMENT, A COPY OF WHICH IS ON FILE WITH
THE ISSUER.  THE SECURITIES  REPRESENTED  BY THIS  INSTRUMENT MAY NOT BE SOLD OR
OTHERWISE  TRANSFERRED  EXCEPT IN COMPLIANCE  WITH SAID  AGREEMENT.  ANY SALE OR
OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENT WILL BE VOID."

     4.3    Rule 144 Reporting. With a view to making available to the  Investor
or a Permitted Transferee  the  benefits of certain rules and regulations of the
SEC  which  may  permit  the sale of  the  Purchased   Securities  to the public
without registration, the Company agrees to use commercially reasonable  efforts
to:

             (1) remain in compliance with the reporting  obligations  under the
                 Exchange Act; and

             (2) so long as the Investor or such Permitted  Transferee  owns any
                 Purchased Securities, furnish to the Investor or such Permitted
                 Transferee  promptly  upon  request a written  statement by the
                 Company as to its  compliance  with the reporting  requirements
                 under Exchange Act.

                                    Article V

                                  Miscellaneous

     5.1   Survival. The representations and warranties of the Company contained
in this  Agreement  shall not survive after the Closing Date, at which time such
representations  and warranties shall expire. The representations and warranties
of the Investor  contained in this  Agreement  shall  survive until the date two
years after the Closing Date, at which time such  representations and warranties
shall expire;  provided that the representations and warranties made in Sections
2.3(a) and (b) shall survive the Closing until the  expiration of the applicable
statute of limitations.

     5.2     Interpretation. When  a  reference is made  in  this  Agreement  to
"Recitals,"  "Articles,"  "Sections" or "Annexes,"  such reference shall be to a
Recital,  Article or Section of, or Annex to, this  Agreement  unless  otherwise
indicated. The terms defined in the singular have a comparable meaning when used
in the plural,  and vice versa. The table of contents and headings  contained in

                                       11
<PAGE>

this  Agreement  are for  reference  purposes  only  and  are  not  part of this
Agreement.  Whenever the words "include,"  "includes" or "including" are used in
this  Agreement,  they  shall be deemed  to be  followed  by the words  "without
limitation."  The words  "contained in" shall be deemed to mean "set forth in or
incorporated by reference  into," and the words  "contain" and "contains"  shall
have corresponding  meanings.  No rule of construction  against the draftsperson
shall be applied in connection  with the  interpretation  or enforcement of this
Agreement, as this Agreement is the product of negotiation between sophisticated
parties advised by counsel.  Except as expressly  stated in this Agreement,  all
references  to any  statute,  rule or  regulation  are to the  statute,  rule or
regulation  as amended,  modified,  supplemented  or replaced  from time to time
(and,  in the case of statutes,  include any rules and  regulations  promulgated
under  the  statute)  and to any  section  of any  statute,  rule or  regulation
including any successor to the section. All references to the "Knowledge" of the
Company  mean the  actual  knowledge  of the Chief  Executive  Officer  or Chief
Financial  Officer of the Company;  all  references  to the  "Knowledge"  of the
Investor mean the actual  knowledge of the  "executive  officers" (as defined in
Rule 3b-7 under the  Exchange  Act) of the  Investor  (or, if the  Investor is a
natural person, the Investor himself or herself). For the avoidance of doubt, at
any time when this Agreement  requires a calculation of the number or percentage
of shares of Common Shares owned or controlled by a person, the number of shares
of  Common  Shares   underlying  any  convertible  or  exchangeable   securities
beneficially  owned or  controlled  by such person are to be included as if such
securities were fully converted in the hands of such person as of that time.

     5.3     Amendment.  No amendment of any provision of this Agreement will be
effective unless made in  writing and  signed by an officer of a duly authorized
representative of each party.

     5.4    Waiver of  Conditions. The conditions to the Company's obligation to
consummate  the  Purchase  are for the sole  benefit of the  Company  and may be
waived by the Company in whole or in part to the extent  permitted by applicable
law.  No waiver  will be  effective  unless it is in a writing  signed by a duly
authorized  officer of the Company that makes express reference to the provision
or provisions subject to such waiver.

     5.5     Counterparts and Facsimile.  This  Agreement may be executed in any
number of separate  counterparts,  each such  counterpart  being deemed to be an
original instrument, and all such counterparts will together constitute the same
agreement.  Executed  signature  pages to this  Agreement  may be  delivered  by
facsimile or  electronically  scanned,  and such facsimiles or electronic  scans
will be deemed as sufficient as if actual signature pages had been delivered.

     5.6    Governing Law; Submission to Jurisdiction, Etc. This Agreement shall
be governed by and construed in  accordance  with the laws of the  State of  New
York  applicable  to  contracts  made  and to be  performed entirely within such
State. In connection with any dispute,  controversy  or claim arising out  of or
relating to the  Transaction   Documents,   or  the  validity,   interpretation,
breach  or  termination of  any such  Transaction  Documents,  including  claims
seeking redress or asserting  rights  under any law, each of the parties  hereto
agrees (a) to submit to the personal jurisdiction of the State or Federal courts
in the New York Counties of Orange and Ulster,  (b) that exclusive  jurisdiction
and venue shall lie in the State or  Federal courts in the State of New York and
(c) that notice may be served  upon such party at the  address and in the manner
set forth for such party in Section 5.8.

                                       12
<PAGE>

     5.7    Notices. All notices, requests, claims,  demands,  waivers and other
communications  hereunder  shall be in writing  and shall be deemed to have been
duly given when  delivered by hand, if delivered  personally  or by courier,  or
three days after being  deposited in the mail  (registered  or  certified  mail,
postage  prepaid,  return receipt  requested).  All notices  hereunder  shall be
delivered as set forth below,  or pursuant to such other  instructions as may be
designated in writing by the party to receive such notice.

             (A) If to the Investor,  to the person and the address indicated on
                 the signature page to this Agreement.

             (B) If to the Company:

                 ES Bancshares, Inc.
                 68 North Plank Road
                 Newburgh, New York 12550
                 Attention:  Philip Guarnieri, President and Co-Chief
                 Executive Officer
                 E-Mail:  pguarnieri@esbna.com
                 Facsimile: (845) 451-7878

                 with a copy to:

                 Luse Gorman Pomerenk & Schick, PC
                 5335 Wisconsin Avenue, NW, Suite 780
                 Washington, D.C. 20015
                 Attention: Kip Weissman, Esq.
                 E-Mail:    kweissman@luselaw.com
                 Facsimile: (202) 362-2902

     5.8     Entire  Agreement,  Etc. (a) This Agreement, the other  Transaction
Documents  executed  and  delivered  on the date hereof and the  confidentiality
letter  agreement,  as  amended,  and entered  into  between the Company and the
Investor,  constitute  the  entire  agreement,  and  supersede  all other  prior
agreements,  understandings,  representations  and warranties,  both written and
oral,  between the parties,  with respect to the subject matter hereof,  and (b)
this  Agreement  will not be  assignable  by any party without the prior written
consent of the other party (any  attempted  assignment in  contravention  hereof
being null and void ab initio).  The Investor  agrees to treat all  confidential
information  provided  by  the  Company  in  connection  with  the  transactions
contemplated by the Transaction  Documents as Proprietary  Information under the
confidentiality   provisions  of  the  aforementioned   confidentiality   letter
agreement.

     5.9    Definitions of "Subsidiary" and "Affiliate".
            -------------------------------------------

             (a) When a reference is made in this Agreement to a Subsidiary of a
person, the term "Subsidiary" means those  corporations,  banks,  savings banks,
associations  and other entities of which such person owns or controls more than
50% of the outstanding  equity securities either directly or through an unbroken
chain of  entities as to each of which more than 50% of the  outstanding  equity
securities is owned directly or indirectly by its parent.

                                       13
<PAGE>

             (b) The term  "Affiliate"  means,  with respect to any person,  any
person directly or indirectly controlling, controlled by or under common control
with, such other person.  For purposes of this  definition,  "control" when used
with respect to any person, means the possession, directly or indirectly, of the
power to cause the  direction  of  management  and/or  policies of such  person,
whether through the ownership of voting securities, by contract or otherwise.

     5.10     Severability. If any  provision of this Agreement or a Transaction
Document,  or  the  application  thereof  to  any  person  or  circumstance,  is
determined  by a  court  of  competent  jurisdiction  to  be  invalid,  void  or
unenforceable,  the remaining  provisions  hereof,  or the  application  of such
provision to persons or  circumstances  other than those as to which it has been
held invalid or unenforceable, will remain in full force and effect and shall in
no way be affected,  impaired or invalidated thereby, so long as the economic or
legal substance of the transactions  contemplated  hereby is not affected in any
manner  materially  adverse to any party. Upon such  determination,  the parties
shall  negotiate  in good  faith in an  effort  to  agree  upon a  suitable  and
equitable substitute provision to effect the original intent of the parties.

     5.11    No Third Party  Beneficiaries. Nothing contained in this Agreement,
expressed or implied, is intended to confer upon any person or entity other than
the Company and the Investor, any benefits, rights, or remedies.

                     [The next page is the signature page.]

                                       14
<PAGE>

     In Witness Whereof,  this Agreement has been duly executed and delivered by
the duly  authorized  officers of the parties hereto as of the date first herein
above written.

                                            ES Bancshares, Inc.

                                            By:
                                                -------------------------------
                                                Name:
                                                Title:

INVESTOR:
          ------------------------------
Address:

By:
    ------------------------------------
    Name:
    Title:

Common Shares Subscribed For:
                                             ----------------------------------

Aggregate Purchase Price Delivered Herewith:
                                             ----------------------------------exh10-1.htm

     

    
      

      

    

     

     

     

     

     

     

     

     

     

    EXHIBIT 10.1

     

    2009 STOCK OPTION PLAN

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    

    

    

    

    

    

    

    

    ________________________________________

     

    SPICY
PICKLE FRANCHISING, INC.

     

    2009
STOCK OPTION PLAN

    ________________________________________

    

    

    

    Adopted
by the Resolution of the Directors on December 30, 2009

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    SPICY
PICKLE FRANCHISING, INC.

    2009
STOCK OPTION PLAN

    

    
      	
              1.  

            	
              Purpose.

            

    

    

    The
purpose of this Plan is to advance the interests of the Company and its
stockholders by helping the Company obtain and retain the services of employees,
officers, consultants, and directors, upon whose judgment, initiative and
efforts the Company is substantially dependent, and to provide those persons
with further incentives to advance the interests of the Company.

    

    

    
      	
              2.  

            	
              Certain
      Definitions.

            

    

    

    Unless
the context otherwise requires, the following defined terms (together with other
capitalized
terms defined elsewhere in this Plan) will govern the construction of this Plan,
and of any stock option agreements entered into pursuant to this
Plan:

    

    
      	
              (a)  

            	
              “10%
      Stockholder” means a person who owns, either directly or indirectly by
      virtue of the ownership attribution provisions set forth in Section 424(d)
      of the Code at the time he or she is granted an Option, stock possessing
      more than ten percent (10%) of the total combined voting power or value of
      all classes of stock of the Company and/or of its
      subsidiaries;

            

    

    

    
      	
              (b)  

            	
              “1933
      Act” means the federal Securities Act of 1933, as
  amended;

            

    

    

    
      	
              (c)  

            	
              “Board”
      means the Board of Directors of the
Company;

            

    

    

    
      	
              (d)  

            	
              “Called
      for under an Option,” or words to similar effect, means issuable pursuant
      to the exercise of an Option;

            

    

    

    
      	
              (e)  

            	
              “Code”
      means the Internal Revenue Code of 1986, as amended (references herein to
      Sections of the Code are intended to refer to Sections of the Code as
      enacted at the time of this Plan’s adoption by the Board and as
      subsequently amended, or to any substantially similar successor provisions
      of the Code resulting from recodification, renumbering or
      otherwise);

            

    

    

    
      	
              (f)  

            	
              “Committee”
      means a committee of two or more Disinterested Directors, appointed by the
      Board, to administer and interpret this Plan; provided that the term
      “Committee” will refer to the Board during such times as no Committee is
      appointed by the Board;

            

    

    

    
      	
              (g)  

            	
              “Company”
      means Spicy Pickle Franchising, Inc., a Colorado
    corporation;

            

    

    

    
      	
              (h)  

            	
               “Disability”
      has the same meaning as “permanent and total disability,” as defined in
      Section 22(e)(3) of the Code;

            

    

    

    
      	
              (i)  

            	
              “Disinterested
      Director” means a member of the Board who is not during the period of one
      year prior to his or her service as an administrator of the Plan, or
      during the period of such service, granted or awarded Stock, options to
      acquire Stock, or similar equity securities of the Company
  

            

    

     

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    
      
        	
                 

              	
                under this Plan or any similar plan of the Company, other
      than the grant of a Formula Option pursuant to section 6(m) of this
      Plan;

              

      

       

    

    
      	
              (j)  

            	
              “Eligible
      Participants” means persons who, at a particular time, are employees,
      officers, consultants, or directors of the Company or its
      subsidiaries;

            

    

    

    
      	
              (k)  

            	
              “Fair
      Market Value” means, with respect to the Stock and as of the date an ISO
      or a Formula Option is granted hereunder, the market price per share of
      such Stock determined by the Committee, consistent with the requirements
      of Section 422 of the Code and to the extent consistent therewith, as
      follows:

            

    

    

    
      	
              (i)  

            	
              If
      the Stock was traded on a stock exchange on the date in question, then the
      Fair Market Value will be equal to the closing price reported by the
      applicable composite-transactions report for such
  date;

            

    

    

    
      	
              (ii)  

            	
              If
      the Stock was traded over-the-counter on the date in question and was
      classified as a national market issue, then the Fair Market Value will be
      equal to the last-transaction price quoted by the NASDAQ system for such
      date;

            

    

    

    
      	
              (iii)  

            	
              If
      the Stock was traded over-the-counter on the date in question but was not
      classified as a national market issue, then the Fair Market Value will be
      equal to the average of the last reported representative bid and asked
      prices quoted by the NASDAQ system for such date;
  and

            

    

    

    
      	
              (iv)  

            	
              If
      none of the foregoing provisions is applicable, then the Fair Market Value
      will be determined by the Committee in good faith on such basis as it
      deems appropriate.

            

    

    

    
      	
              (l)  

            	
              “Formula
      Option” means an NSO granted to members of the Committee pursuant to
      section 6(m) hereof;

            

    

    

    
      	
              (m)  

            	
              “ISO”
      has the same meaning as “incentive stock option,” as defined in Section
      422 of the Code;

            

    

    

    
      	
              (n)  

            	
              “Just
      Cause Termination” means a termination by the Company of an Optionee’s
      employment by and/or service to the Company (or if the Optionee is a
      director, removal of the Optionee from the Board by action of the
      stockholders or, if permitted by applicable law and the by-laws of the
      Company, the other directors), in connection with the good faith
      determination of the Company’s board of directors (or of the Company’s
      stockholders if the Optionee is a director and the removal of the Optionee
      from the Board is by action of the stockholders, but in either case
      excluding the vote of the Optionee if he or she is a director or a
      stockholder) that the Optionee has engaged in any acts involving
      dishonesty or moral turpitude or in any acts that materially and adversely
      affect the business, affairs or reputation of the Company or its
      subsidiaries;

            

    

    

    
      	
              (o)  

            	
              “NSO”
      means any option granted under this Plan whether designated by the
      Committee as a “non-qualified stock option,” a “non-statutory stock
      option” or otherwise, other than an option designated by the Committee as
      an ISO, or any option so designated but which, for any reason, fails to
      qualify as an ISO pursuant to Section 422 of the Code and the rules and
      regulations thereunder;

            

    

     

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

       

    

    
      	
              (p)  

            	
              “Option”
      means an option granted pursuant to this Plan entitling the option holder
      to acquire shares of Stock issued by the Company pursuant to the valid
      exercise of the option;

            

    

    

    
      	
              (q)  

            	
              “Option
      Agreement” means an agreement between the Company and an Optionee, in form
      and substance satisfactory to the Committee in its sole discretion,
      consistent with this Plan;

            

    

    

    
      	
              (r)  

            	
              “Option
      Price” with respect to any particular Option means the exercise price at
      which the Optionee may acquire each share of the Option Stock called for
      under such Option;

            

    

    

    
      	
              (s)  

            	
              “Option
      Stock” means Stock issued or issuable by the Company pursuant to the valid
      exercise of an Option;

            

    

    

    
      	
              (t)  

            	
              “Optionee”
      means an Eligible Participant to whom Options are granted hereunder, and
      any transferee thereof pursuant to a Transfer authorized under this
      Plan;

            

    

    

    
      	
              (u)  

            	
              “Plan”
      means this 2009 Stock Option Plan of the
  Company;

            

    

    

    
      	
              (v)  

            	
              “QDRO”
      has the same meaning as “qualified domestic relations order” as defined in
      Section 414(p) of the Code;

            

    

    

    
      	
              (w)  

            	
              “Stock”
      means shares of the Company’s Common Stock, $0.001 par
    value;

            

    

    

    
      	
              (x)  

            	
              “Subsidiary”
      has the same meaning as “Subsidiary Corporation” as defined in Section
      424(f) of the Code;

            

    

    

    
      	
              (y)

            	
              “Transfer,”
      with respect to Option Stock, includes, without limitation, a voluntary or
      involuntary sale, assignment, transfer, conveyance, pledge, hypothecation,
      encumbrance, disposal, loan, gift, attachment or levy of such Option
      Stock, including without limitation an assignment for the benefit of
      creditors of the Optionee, a transfer by operation of law, such as a
      transfer by will or under the laws of descent and distribution, an
      execution of judgment against the Option Stock or the acquisition of
      record or beneficial ownership thereof by a lender or creditor, a transfer
      pursuant to a QDRO, or to any decree of divorce, dissolution or separate
      maintenance, any property settlement, any separation agreement or any
      other agreement with a spouse (except for estate planning purposes) under
      which a part or all of the shares of Option Stock are transferred or
      awarded to the spouse of the Optionee or are required to be sold; or a
      transfer resulting from the filing by the Optionee of a petition for
      relief, or the filing of an involuntary petition against such Optionee,
      under the bankruptcy laws of the United States or of any other
      nation.

            

    

    

    

    
      	
              3.  

            	
              Eligibility.

            

    

    

    The
Company may grant Options under this Plan only to persons who are Eligible
Participants as of the time of such grant. Subject to the provisions of sections
4(d), 5 and 6 hereof, there is no limitation on the number of Options that may
be granted to an Eligible Participant.

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    
      	
              4.  

            	
              Administration.

            

    

    

    
      	
              (a)  

            	
              Committee. The
      Committee, if appointed by the Board, will administer this Plan. If the
      Board, in its discretion, does not appoint such a Committee, the Board
      itself will administer this Plan and take such other actions as the
      Committee is authorized to take hereunder; provided that the Board may
      take such actions hereunder in the same manner as the Board may take other
      actions under the Company’s Articles of Incorporation and By-laws
      generally.

            

    

    

    
      	
              (b)  

            	
              Authority and Discretion of
      Committee. The Committee will have full and final authority in its
      discretion, at any time and from time to time, subject only to the express
      terms, conditions and other provisions of the Company’s Articles of
      incorporation, by-laws and this Plan, and the specific limitations on such
      discretion set forth herein:

            

    

    

    
      	
              (i)  

            	
              to
      select and approve the persons who will be granted Options under this Plan
      from among the Eligible Participants, and to grant to any person so
      selected one or more Options to purchase such number of shares of Option
      Stock as the Committee may
determine;

            

    

    

    
      	
              (ii)  

            	
              to
      determine the period or periods of time during which Options may be
      exercised, the Option Price and the duration of such Options, and other
      matters to be determined by the Committee in connection with specific
      Option grants and Options Agreements as specified under this
      Plan;

            

    

    

    
      	
              (iii)  

            	
              to
      interpret this Plan, to prescribe, amend and rescind rules and regulations
      relating to this Plan, and to make all other determinations necessary or
      advisable for the operation and administration of this Plan;
      and

            

    

    

    
      	
              (iv)  

            	
              to
      delegate all or a portion of its authority under subsections (i) and (ii)
      of this section 4(b) to one or more directors of the Company who are
      executive officers of the Company, but only in connection with Options
      granted to Eligible Participants who are not subject to the reporting and
      liability provisions of Section 16 of the Securities Exchange Act of 1934,
      as amended, and the rules and regulations thereunder, and subject to such
      restrictions and limitations (such as the aggregate number of shares of
      Option Stock called for by such Options that may be granted) as the
      Committee may decide to impose on such delegate
  directors.

            

    

    

    
      	
              (c)  

            	
              Limitation on Authority.
      Notwithstanding the foregoing, or any other provision of this Plan,
      the Committee will have no
authority:

            

    

    

    
      	
              (i)  

            	
              to
      grant Options to any of its members, whether or not approved by the Board;
      and

            

    

    

    
      	
              (ii)  

            	
              to
      determine any matters, or exercise any discretion, in connection with the
      Formula Options under section 6(m) hereof, to the extent that the power to
      make such determinations or to exercise such discretion would cause one or
      more members of the Committee no longer to be “Disinterested Directors”
      within the meaning of section 2(i)
above.

            

    

     

    
 

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    
      	
              (d)  

            	
              Designation of Options.
      Except as otherwise provided herein, the Committee will designate
      any Option granted hereunder either as an ISO or as an NSO. To the extent
      that the Fair Market Value (determined at the time the Option is granted)
      of Stock with respect to which all ISOs are exercisable for the first time
      by any individual during any calendar year (pursuant to this Plan and all
      other plans of the Company and/or its subsidiaries) exceeds $100,000, such
      option will be treated as an NSO. Notwithstanding the general eligibility
      provisions of section 3 hereof, the Committee may grant ISOs only to
      persons who are employees of the Company and/or its
      subsidiaries.

            

    

    

    
      	
              (e)  

            	
              Option Agreements.
      Options will be deemed granted hereunder only upon the execution
      and delivery of an Option Agreement by the Optionee and a duly authorized
      officer of the Company. Options will not be deemed granted hereunder
      merely upon the authorization of such grant by the
    Committee.

            

    

     

     

    
      	
              5.  

            	
              Shares
      Reserved for Options.

            

    

    

    
      	
              (a)  

            	
              Option Pool.
      The aggregate number of shares of Option Stock that may be issued
      pursuant to the exercise of Options granted under this Plan will not
      exceed Five Million (5,000,000) (the “Option Pool”), provided that such
      number will be increased by the number of shares of Option Stock that the
      Company subsequently may reacquire through repurchase or otherwise. Shares
      of Option Stock that would have been issuable pursuant to Options, but
      that are no longer issuable because all or part of those Options have
      terminated or expired, will be deemed not to have been issued for purposes
      of computing the number of shares of Option Stock remaining in the Option
      Pool and available for issuance.

            

    

    

    
      	
              (b)  

            	
              Adjustments
      Upon Changes in Stock. In the event of any change in the
      outstanding Stock of the Company as a result of a stock split, reverse
      stock split, stock dividend, recapitalization, combination or
      reclassification, appropriate proportionate adjustments will be made
      in:

            

    

    

    
      	
              (i)  

            	
              the
      aggregate number of shares of Option Stock in the Option Pool that may be
      issued pursuant to the exercise of Options granted
    hereunder;

            

    

    

    
      	
              (ii)  

            	
              the
      Option Price and the number of shares of Option Stock called for in each
      outstanding Option granted hereunder;
and

            

    

    

    
      	
              (iii)

            	
              other
      rights and matters determined on a per share basis under this Plan or any
      Option Agreement hereunder. Any such adjustments will be made only by the
      Board, and when so made will be effective, conclusive and binding for all
      purposes with respect to this Plan and all Options then outstanding. No
      such adjustments will be required by reason of the issuance or sale by the
      Company for cash or other consideration of additional shares of its Stock
      or securities convertible into or exchangeable for shares of its
      Stock.

            

    

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

    
      	
              6.  

            	
              Terms
      of Stock Option Agreements.

            

    

    

    Each
Option granted pursuant to this Plan will be evidenced by an agreement (an
“Option Agreement”) between the Company and the person to whom such Option is
granted, in form and substance satisfactory to the Committee in its sole
discretion, consistent with this Plan. Without limiting the foregoing, each
Option Agreement (unless otherwise stated therein) will be deemed to include the
following terms and conditions:

    

    
      	
              (a)  

            	
              Covenants of Optionee.
      At the discretion of the Committee, the person to whom an Option is
      granted hereunder, as a condition to the granting of the Option, must
      execute and deliver to the Company a confidential information agreement
      approved by the Committee. Nothing contained in this Plan, any Option
      Agreement or in any other agreement executed in connection with the
      granting of an Option under this Plan will confer upon any Optionee any
      right with respect to the continuation of his or her status as an employee
      of, consultant or independent contractor to, or director of, the Company
      or its subsidiaries.

            

    

    

    
      	
               

            	
              Vesting Periods. Except
      as otherwise provided herein, each Option Agreement may specify the period
      or periods of time within which each Option or portion thereof will first
      become exercisable (the “Vesting Period”) with respect to the total number
      of shares of Option Stock called for thereunder (the “Total Award Option
      Stock”). Such Vesting Periods will be fixed by the Committee in its
      discretion, and may be accelerated or shortened by the Committee in its
      discretion.

            

    

    

    
      	
              (c)  

            	
              Exercise
      of the Option.

            

    

    

    
      	
              (i)  

            	
               Mechanics and Notice.
      An Option may be exercised to the extent exercisable (1) by giving
      written notice of exercise to the Company, specifying the number of full
      shares of Option Stock to be purchased and accompanied by full payment of
      the Option Price thereof and the amount of withholding taxes pursuant to
      subsection 6(c)(ii) below; and (2) by giving assurances satisfactory to
      the Company that the shares of Option Stock to be purchased upon such
      exercise are being purchased for investment and not with a view to resale
      in connection with any distribution of such shares in violation of the
      1933 Act; provided, however, that in the event the Option Stock called for
      under the Option is registered under the 1933 Act, or in the event resale
      of such Option Stock without such registration would otherwise be
      permissible, this second condition will be inoperative if, in the opinion
      of counsel for the Company, such condition is not required under the 1933
      Act, or any other applicable law, regulation or rule of any governmental
      agency.

            

    

    

    
      	
              (ii)

            	
              Withholding Taxes. As a
      condition to the issuance of the shares of Option Stock upon full or
      partial exercise of an NSO granted under this Plan, the Optionee will pay
      to the Company in cash, or in such other form as the Committee may
      determine in its discretion, the amount of the Company’s tax withholding
      liability required in connection with such exercise. For purposes of this
      subsection 6(c)(ii), “tax withholding liability” will mean all federal and
      state income taxes, social security tax, and any other taxes applicable to
      the compensation income arising from the transaction required by
      applicable law to be withheld by the
Company.

            

    

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    
 

    
      	
              (d)  

            	
              Payment of Option Price.
      Each Option Agreement will specify the Option Price with respect to
      the exercise of Option Stock thereunder, to be fixed by the Committee in
      its discretion, but in no event will the Option Price for an ISO granted
      hereunder be less than the Fair Market Value (or, in case the Optionee is
      a 10% Stockholder, one hundred ten percent (110%) of such Fair Market
      Value) of the Option Stock at the time such ISO is granted, and in no
      event will the Option Price for an NSO granted hereunder be less than
      eighty-five percent (85%) of Fair Market Value. The Option Price will be
      payable to the Company in United States dollars in cash or by check or,
      such other legal consideration as may be approved by the Committee, in its
      discretion.

            

    

    

    
      	
              (i)  

            	
              For
      example, the Committee, in its discretion, may permit a particular
      Optionee to pay all or a portion of the Option Price, and/or the tax
      withholding liability set forth in subsection 6(c)(ii) above, with respect
      to the exercise of an Option either by surrendering shares of Stock
      already owned by such Optionee or by withholding shares of Option Stock,
      provided that the Committee determines that the fair market value of such
      surrendered Stock or withheld Option Stock is equal to the corresponding
      portion of such Option Price and/or tax withholding liability, as the case
      may be, to be paid for therewith.

            

    

    

    
      	
              (ii)  

            	
              If
      the Committee permits an Optionee to pay any portion of the Option Price
      and/or tax withholding liability with shares of Stock with respect to the
      exercise of an Option (the “Underlying Option”) as provided in subsection
      6(d)(i) above, then the Committee, in its discretion, may grant to such
      Optionee (but only if Optionee remains an Eligible Participant at that
      time) additional NSOs, the number of shares of Option Stock called for
      thereunder to be equal to all or a portion of the Stock so surrendered or
      withheld (a “Replacement Option”). Each Replacement Option will be
      evidenced by an Option Agreement. Unless otherwise set forth therein, each
      Replacement Option will be immediately exercisable upon such grant
      (without any Vesting Period) and will be coterminous with the Underlying
      Option. The Committee, in its sole discretion, may establish such other
      terms and conditions for Replacement Options as it deems
      appropriate.

            

    

    

    
      	
              (e)  

            	
              Termination of the Option.
      Except as otherwise provided herein, each Option Agreement will
      specify the period of time, to be fixed by the Committee in its
      discretion, during which the Option granted therein will be exercisable,
      not to exceed ten years from the date of grant in the case of an ISO (the
      “Option Period”); provided that the Option Period will not exceed five
      years from the date of grant in the case of an ISO granted to a 10%
      Stockholder. To the extent not previously exercised, each Option will
      terminate upon the expiration of the Option Period specified in the Option
      Agreement; provided, however, that each such Option will terminate, if
      earlier:

            

    

    

    
      	
              (i)  

            	
              ninety
      days after the date that the Optionee ceases to be an Eligible Participant
      for any reason, other than by reason of death or disability or a Just
      Cause Termination;

            

    

    

    
      	
              (ii)  

            	
              twelve
      months after the date that the Optionee ceases to be an Eligible
      Participant by reason of such person’s death or disability;
    or

            

    

    

    
      	
              (iii)  

            	
              immediately
      as of the date that the Optionee ceases to be an Eligible Participant by
      reason of a Just Cause Termination.

            

    

     

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    In the
event of a sale of all or substantially all of the assets of the Company, or a
merger or consolidation or other reorganization in which the Company is not the
surviving corporation, or in which the Company becomes a subsidiary of another
corporation (any of the foregoing events, a “Corporate Transaction”), then
notwithstanding anything else herein, the right to exercise all then outstanding
Options will vest immediately prior to such Corporate Transaction and will
terminate immediately after such Corporate Transaction; provided, however, that
if the Board, in its sole discretion, determines that such immediate vesting of
the right to exercise outstanding Options is not in the best interests of the
Company, then the successor corporation must agree to assume the outstanding
Options or substitute therefor comparable options of such successor corporation
or a parent or subsidiary of such successor corporation.

    

    
      	
              (f)  

            	
              Options Nontransferable.
      No Option will be transferable by the Optionee otherwise than by
      will or the laws of descent and distribution, or in the case of an NSO,
      pursuant to a QDRO. During the lifetime of the Optionee, the Option will
      be exercisable only by him or her, or the transferee of an NSO if it was
      transferred pursuant to a QDRO.

            

    

    

    
      	
              (g)  

            	
              Qualification of Stock.
      The right to exercise an Option will be further subject to the
      requirement that if at any time the Board determines, in its discretion,
      that the listing, registration or qualification of the shares of Option
      Stock called for thereunder upon any securities exchange or under any
      state or federal law, or the consent or approval of any governmental
      regulatory authority, is necessary or desirable as a condition of or in
      connection with the granting of such Option or the purchase of shares of
      Option Stock thereunder, the Option may not be exercised, in whole or in
      part, unless and until such listing, registration, qualification, consent
      or approval is effected or obtained free of any conditions not acceptable
      to the Board, in its discretion.

            

    

    

    
      	
              (h)  

            	
              Additional Restrictions on
      Transfer. By accepting Options and/or Option Stock under this Plan,
      the Optionee will be deemed to represent, warrant and agree as
      follows:

            

    

    

    
      	
              (i)

            	
              Securities Act of 1933.
      The Optionee understands that the shares of Option Stock have not
      been registered under the 1933 Act, and that such shares are not freely
      tradable and must be held indefinitely unless such shares are either
      registered under the 1933 Act or an exemption from such registration is
      available. The Optionee understands that the Company is under no
      obligation to register the shares of Option
  Stock.

            

    

    

    
      	
              (ii)

            	
              Other Applicable Laws.
      The Optionee further understands that Transfer of the Option Stock
      requires full compliance with the provisions of all applicable
      laws.

            

    

    

    
      	
              (iii)

            	
              Investment Intent.
      Unless a registration statement is in effect with respect to the
      sale of Option Stock obtained through exercise of Options granted
      hereunder: (1) Upon exercise of any Option, the Optionee will purchase the
      Option Stock for his or her own account and not with a view to
      distribution within the meaning of the 1933 Act, other than as may be
      effected in compliance with the 1933 Act and the rules and regulations
      promulgated thereunder; (2) no one else will have any beneficial interest
      in the Option Stock; and (3) he or she has no present intention of
      disposing of the Option Stock at any particular
  time.

            

    

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    
 

    
      	
              (i)  

            	
              Compliance with Law.
      Notwithstanding any other provision of this Plan, Options may be
      granted pursuant to this Plan, and Option Stock may be issued pursuant to
      the exercise thereof by an Optionee, only after there has been compliance
      with all applicable federal and state securities laws, and all of the same
      will be subject to this overriding condition. The Company will not be
      required to register or qualify Option Stock with the Securities and
      Exchange Commission or any State agency, except that the Company will
      register with, or as required by local law, file for and secure an
      exemption from such registration requirements from, the applicable
      securities administrator and other officials of each jurisdiction in which
      an Eligible Participant would be granted an Option hereunder prior to such
      grant.

            

    

    

    
      	
              (j)  

            	
              Stock Certificates.
      Certificates representing the Option Stock issued pursuant to the
      exercise of Options will bear all legends required by law and necessary to
      effectuate this Plan’s provisions. The Company may place a “stop transfer”
      order against shares of the Option Stock until all restrictions and
      conditions set forth in this Plan and in the legends referred to in this
      section 6(k) have been complied
with.

            

    

    

    
      	
              (k)  

            	
              Notices. Any notice to
      be given to the Company under the terms of an Option Agreement will be
      addressed to the Company at its principal executive office, Attention:
      Corporate Secretary, or at such other address as the Company may designate
      in writing. Any notice to be given to an Optionee will be addressed to the
      Optionee at the address provided to the Company by the Optionee. Any such
      notice will be deemed to have been duly given if and when enclosed in a
      properly sealed envelope, addressed as aforesaid, registered and
      deposited, postage and registry fee prepaid, in a post office or branch
      post office regularly maintained.

            

    

    

    
      	
              (l)  

            	
              Other Provisions. The
      Option Agreement may contain such other terms, provisions and conditions,
      including such special forfeiture conditions, rights of repurchase, rights
      of first refusal and other restrictions on Transfer of Option Stock issued
      upon exercise of any Options granted hereunder, not inconsistent with this
      Plan, as may be determined by the Committee in its sole
      discretion.

            

    

    

    
      	
              (m)

            	
              Formula
      Options. [Reserved for future
  consideration]

            

    

    

    

    
      	
              7.  

            	
              Proceeds
      from Sale of Stock.

            

    

    

    Cash
proceeds from the sale of shares of Option Stock issued from time to time upon
the exercise of Options granted pursuant to this Plan will be added to the
general funds of the Company and as such will be used from time to time for
general corporate purposes.

    

    
      	
              8.  

            	
              Modification,
      Extension and Renewal of Options.

            

    

    

    Subject
to the terms and conditions and within the limitations of this Plan, and except
with respect to Formula Options, the Committee may modify, extend or renew
outstanding Options granted under this Plan, or accept the surrender of
outstanding Options (to the extent not theretofore exercised) and authorize the
granting of new Options in substitution therefor (to the extent not theretofore
exercised). 

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

     

    Notwithstanding
the foregoing, however, no modification of any Option will, without the consent
of the holder of the Option, alter or impair any rights or obligations under any
Option theretofore granted under this Plan.

    

    

    
      	
              9.  

            	
              Amendment
      and Discontinuance.

            

    

    

    The Board
may amend, suspend or discontinue this Plan at any time or from time to time;
provided that no action of the Board will cause ISOs granted under this Plan not
to comply with Section 422 of the Code unless the Board specifically declares
such action to be made for that purpose and provided further that no such action
may, without the approval of the stockholders of the Company, materially
increase (other than by reason of an adjustment pursuant to section 5(b) hereof)
the maximum aggregate number of shares of Option Stock in the Option Pool that
may be issued under Options granted pursuant to this Plan or materially increase
the benefits accruing to Plan participants or materially modify eligibility
requirements for the participants. Provided, further, that the provisions of
section 6(m) hereof may not be amended more often than once during any six (6)
month period, other than to comport with changes in the Code, the Employee
Retirement Income Security Act, or the rules and regulations thereunder.
Moreover, no such action may alter or impair any Option previously granted under
this Plan without the consent of the holder of such Option.

    

    

    
      	
              10.  

            	
              Plan
      Compliance with Rule 16b-3.

            

    

    

    With
respect to persons subject to Section 16 of the Securities Exchange Act of 1934,
transactions under this plan are intended to comply with all applicable
conditions of Rule 16b- 3 or its successors under the 1934 Act. To the extent
any provision of the plan or action by the plan administrators fails so to
comply, it shall be deemed null and void, to the extent permitted by law and
deemed advisable by the plan administrators.

    

    
      	
              11.  

            	
              Copies
      of Plan.

            

    

    

    A copy of
this Plan will be delivered to each Optionee at or before the time he or she
executes an Option Agreement.

    

    

    Date Plan
Adopted by Board of
Directors:              December
30, 2009

     

     

     

     

     

     

     

     

     

     

    10

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00167-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00167-of-00352.parquet"}]]