Document:

RESTRICTED
STOCK AGREEMENT

    

    MANDALAY
MEDIA, INC.

    

    AGREEMENT
made as of the _______ day of March [__], 2009
(the “Grant Date”), between Mandalay Media, Inc. (the “Company”), a Delaware
corporation, and [________________________] (the
“Participant”).

    

    WHEREAS,
the Company has adopted the 2007 Employee, Director and Consultant Stock Plan,
as amended (the “Plan”), to promote the interests of the Company by providing an
incentive for employees, directors and consultants of the Company or its
Affiliates; and

    

    WHEREAS,
pursuant to the provisions of the Plan, the Company desires to offer to the
Participant shares of the Company’s common stock, $.0001 par value per share
(“Common Stock”), in accordance with the provisions of the Plan, all on the
terms and conditions hereinafter set forth; and

    

    WHEREAS,
Participant wishes to accept said offer; and

    

    WHEREAS,
the parties hereto understand and agree that any terms used and not defined
herein have the meanings ascribed to such terms in the Plan.

    

    NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:

    

    1.           Terms of
Grant.  The Participant hereby accepts the offer of the Company
to issue to the Participant, in accordance with the terms of the Plan and this
Agreement, __________ Shares of the Company’s Common Stock (such shares subject
to adjustment pursuant to Section 24 of the Plan and Subsection 2.1(g) hereof,
the “Granted Shares”) at a purchase price of $0.0001 per share (the “Purchase
Price”), receipt of which is hereby acknowledged by the Company by the
Participant’s prior service to the Company and which amount will be reported,
for United States Participants, as income on the Participant’s W-2 for this
calendar year and, for non-United States Participants, as required under the
laws of their taxing jurisdiction.

    

    2.1.           Forfeiture
Provisions.

    

    (a)           Lapsing Forfeiture
Right.  In the event that for any reason the Participant is no
longer an employee, director or consultant of the Company or an Affiliate prior
to one (1) year from the Grant Date (the “Termination”), the Participant (or the
Participant’s Survivor) shall, on the date of Termination, immediately forfeit
to the Company (or its designee) the number of Granted Shares which have not yet
lapsed in accordance with the schedule set forth below (the “Lapsing Forfeiture
Right”).

    

    The Company’s Lapsing Forfeiture Right
is as follows:

    

    (i)           A
pro rata portion of the Granted Shares shall be vested and free of the Lapsing
Forfeiture Right as of the Termination based on the number of days elapsed from
the Grant Date until one (1) year from the Grant Date (rounded down to the
nearest whole share), plus such additional shares as may be determined pursuant
to the Salary Reduction Acknowledgement dated as of the date hereof, and the
remaining Granted Shares shall be forfeited to the Company.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b)           Effect of a For Cause
Termination.  Notwithstanding anything to the contrary
contained in this Agreement, in the event the Company or an Affiliate terminates
the Participant’s employment or service for Cause, all of the Granted Shares
then held by the Participant shall be forfeited to the Company immediately as of
the time the Participant is notified that he or she has been terminated for
Cause or that he or she engaged in conduct which would constitute
Cause.

    

    (c)           Effect of Change of
Control.  Except as otherwise provided in Subsection 2.1(b)
above, the Company’s Lapsing Forfeiture Right shall terminate, and the
Participant’s ownership of all Granted Shares then owned by the Participant
shall become vested and free of the Lapsing Forfeiture Right in the event of a
Change of Control (as defined below).

    

    Change of Control
means (i) a merger or consolidation of the Company whether or not approved by
the Board of Directors, other than a merger or consolidation which would result
in the voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity or the parent of such
corporation) more than fifty percent (50%) of the total voting power represented
by the voting securities of the Company or such surviving entity or parent
of such corporation, as the case may be, outstanding immediately after such
merger or consolidation; or (ii) the stockholders of the Company approve an
agreement for the sale or disposition by the Company of all or substantially all
of the Company’s assets.

    

    (d)           Prohibition on
Transfer.  The Participant recognizes and agrees that all
Granted Shares even if no longer subject to the Lapsing Forfeiture Right may not
be sold, transferred, assigned, hypothecated, pledged, encumbered or otherwise
disposed of, whether voluntarily or by operation of law, other than to the
Company (or its designee) for a period of one year from the Grant Date (the
“Holding Period”).  The Company shall not be required to transfer any
Granted Shares on its books which shall have been sold, assigned or otherwise
transferred in violation of this Subsection 2.1(d), or to treat as the owner of
such Granted Shares, or to accord the right to vote as such owner or to pay
dividends to, any person or organization to which any such Granted Shares shall
have been so sold, assigned or otherwise transferred, in violation of this
Subsection 2.1(d).

    

    (e)           Escrow.  The
certificates representing all Granted Shares issued to the Participant hereunder
shall be delivered to the Company and the Company shall hold such Granted Shares
in escrow as provided in this Subsection 2.1(e).  The Company
shall promptly release from escrow and deliver to the Participant within 30 days
of the Holding Period a certificate for the whole number of Granted Shares, if
any, as to which the Company’s Lapsing Forfeiture Right has lapsed . In the
event of forfeiture to the Company of Granted Shares subject to the Lapsing
Forfeiture Right, the Company shall release from escrow as of the date of
Termination and cancel a certificate for the number of Granted Shares so
forfeited.  Any securities distributed in respect of the Granted
Shares held in escrow, including, without limitation, shares issued as a result
of stock splits, stock dividends or other recapitalizations, shall also be held
in escrow in the same manner as the Granted Shares.

    

    (f)           Failure to Deliver Granted
Shares to be Forfeited.  In the event that the Granted Shares
to be forfeited to the Company under this Agreement or subject to the Holding
Period are not in the Company’s possession pursuant to Subsection 2.1(e) above
or otherwise and the Participant or the Participant’s Survivor fails to deliver
such Granted Shares to the Company (or its designee), the Company may
immediately take such action as is appropriate to transfer record title of such
Granted Shares from the Participant to the Company (or its designee) and treat
the Participant and such Granted Shares in all respects as if delivery of such
Granted Shares had been made as required by this Agreement.  The
Participant hereby irrevocably grants the Company a power of attorney which
shall be coupled with an interest for the purpose of effectuating the preceding
sentence.

    

    
      
         

      

      
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    (g)           Adjustments.  The
Plan contains provisions covering the treatment of the Granted Shares in a
number of contingencies such as stock splits and mergers.  Provisions
in the Plan for adjustment with respect to the Granted Shares and the related
provisions with respect to successors to the business of the Company are hereby
made applicable hereunder and are incorporated herein by reference.

    

    
      	
               
      

            	
              2.2

            	
              General Restrictions
      on Transfer of Granted
Shares.

            

    

    

    (a)           The
Participant agrees that in the event the Company proposes to offer for sale to
the public any of its equity securities and such Participant is requested by the
Company and any underwriter engaged by the Company in connection with such
offering to sign an agreement restricting the sale or other transfer of Shares,
then it will promptly sign such agreement and will not transfer, whether in
privately negotiated transactions or to the public in open market transactions
or otherwise, any Shares or other securities of the Company held by him or her
during such period as is determined by the Company and the underwriters, not to
exceed ninety (90) days following the closing of the offering, plus such
additional period of time as may be required to comply with Marketplace Rule
2711 of the National Association of Securities Dealers, Inc. or similar rules
thereto (such period, the “Lock-Up Period”).  Such agreement shall be
in writing and in form and substance reasonably satisfactory to the Company and
such underwriter and pursuant to customary and prevailing terms and
conditions.  Notwithstanding whether the Participant has signed such
an agreement, the Company may impose stop-transfer instructions with respect to
the Shares or other securities of the Company subject to the foregoing
restrictions until the end of the Lock-Up Period.

    

    (b)           The
Participant acknowledges and agrees that neither the Company nor, its
shareholders nor its directors and officers, has any duty or obligation to
disclose to the Participant any material information regarding the business of
the Company or affecting the value of the Shares before, at the time of, or
following a Termination, including, without limitation, any information
concerning plans for the Company to make a public offering of its securities or
to be acquired by or merged with or into another firm or entity.

    

    3.           Purchase for Investment;
Securities Law Compliance.  The offering and sale of the
Granted Shares have not been effectively registered under the Securities Act of
1933, as amended (the “1933 Act”).  The Participant hereby represents
and warrants that he or she is acquiring the Granted Shares for his or her own
account, for investment, and not with a view to, or for sale in connection with,
the distribution of any such Granted Shares. The Participant understands that
because the Granted Shares have not been registered under the Securities Act,
the Participant must continue to bear the economic risk of the investment for an
indefinite period of time. The Participant represents
and warrants that the Participant (1) has been furnished with all information
which it deems necessary to evaluate the merits and risks of the receipt of the
Granted Shares, (2) has had the opportunity to ask questions concerning the
Granted Shares and the Company and all questions posed have been answered to its
satisfaction, (3) has been given the opportunity to obtain any additional
information it deems necessary to verify the accuracy of any information
obtained concerning the Granted Shares and the Company and (4) has such
knowledge and experience in financial and business matters that the Participant
is able to evaluate the merits and risks of investing in the Granted Shares and
to make an informed investment decision relating thereto.  The
Participant specifically acknowledges and agrees that any sales of Granted
Shares shall be made in accordance with the requirements of the 1933 Act, in a
transaction as to which the Company shall have received an opinion of counsel
satisfactory to it confirming such
compliance.  The Participant shall be bound by the provisions of the
following legend which shall be endorsed upon the certificate(s) evidencing the
Shares issued:

    

    “The
shares represented by this certificate have been taken for investment and they
may not be sold or otherwise transferred by any person, including a pledgee,
unless (1) either (a) a Registration Statement with respect to such shares shall
be effective under the Securities Act of 1933, as amended, or (b) the Company
shall have received an opinion of counsel satisfactory to it that an exemption
from registration under such Act is then available, and (2) there shall have
been compliance with all applicable state securities laws.”

    

    
      
         

      

      
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    4.           Rights as a
Stockholder.  The Participant shall have all the rights of a
stockholder with respect to the Granted Shares, including voting and dividend
rights, subject to the transfer and other restrictions set forth herein and in
the Plan.

    

    5.           Legend.  In
addition to any legend required pursuant to the Plan, all certificates
representing the Granted Shares to be issued to the Participant pursuant to this
Agreement shall have endorsed thereon a legend substantially as
follows:

    

    “The
shares represented by this certificate are subject to restrictions set forth in
a Restricted Stock Agreement dated as of March [__], 2009 with this Company, a
copy of which Agreement is available for inspection at the offices of the
Company or will be made available upon request.”

    

    6.           Incorporation of the
Plan.  The Participant specifically understands and agrees that
the Granted Shares issued under the Plan are being sold to the Participant
pursuant to the Plan, a copy of which Plan the Participant acknowledges he or
she has read and understands and by which Plan he or she agrees to be
bound.  The provisions of the Plan are incorporated herein by
reference.

    

    7.           Tax Liability of the
Participant and Payment of Taxes. The Participant acknowledges and agrees
that any income or other taxes due from the Participant with respect to the
Granted Shares issued pursuant to this Agreement, including, without limitation,
the Lapsing Forfeiture Right, shall be the Participant’s
responsibility.  Without limiting the foregoing, the Participant
agrees that, to the extent that the lapsing of restrictions on disposition of
any of the Granted Shares or the declaration of dividends on any such shares
before the lapse of such restrictions on disposition results in the
Participant’s being deemed to be in receipt of earned income, the Company shall
be entitled to immediate payment from the Participant of the amount of any tax
required to be withheld by the Company under applicable tax law.  The
Participant has been given the opportunity to obtain the advice of his or her
tax advisors with respect to the tax consequences of the purchase of the Granted
Shares and the provisions of this Agreement.

    

    Upon
execution of this Agreement, if the Participant is a United States tax payer,
the Participant may file an election under Section 83 of the Code in
substantially the form attached as Exhibit
B.  The Participant acknowledges that if he does not file such
an election, as the Granted Shares are released from the Lapsing Forfeiture
Right in accordance with Section 2.1, the Participant will have income for tax
purposes equal to the fair market value of the Granted Shares at such date, less
the price paid for the Granted Shares by the Participant.

    

    Any taxes due from the Participant that
are required to be withheld by the Company under any applicable tax law shall be
paid, at the option of the Participant, as follows:

    

    (a)           through
reducing the number of shares of Common Stock actually released to the
Participant from the Lapsing Forfeiture Right in an amount equal to the amount
of minimum withholding tax due and payable by the Company.  Fractional
shares will not be retained to satisfy any portion of the withholding
tax.  Accordingly, the Participant agrees that in the event that the
amount of withholding owed would result in a fraction of a share being owed,
that amount will be satisfied by withholding the fractional amount from the
Participant’s paycheck; or

    

    
      
         

      

      
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    (b)           requiring
the Participant to deposit with the Company an amount of cash equal to the
amount determined by the Company to be required with respect to the statutory
minimum of the Participant’s estimated total federal, state and local tax
obligations associated with the termination of the Lapsing Forfeiture Right with
respect to the Granted Shares or otherwise withholding from the Participant’s
paycheck an amount equal to the withholding tax due and payable.

    

    8.           Equitable
Relief.  The Participant specifically acknowledges and agrees
that in the event of a breach or threatened breach of the provisions of this
Agreement or the Plan, including the attempted transfer of the Granted Shares by
the Participant in violation of this Agreement, monetary damages may not be
adequate to compensate the Company, and, therefore, in the event of such a
breach or threatened breach, in addition to any right to damages, the Company
shall be entitled to equitable relief in any court having competent
jurisdiction.  Nothing herein shall be construed as prohibiting the
Company from pursuing any other remedies available to it for any such breach or
threatened breach.

    

    9.           No Obligation to Maintain
Relationship.  The Company is not by the Plan or this Agreement
obligated to continue the Participant as an employee, director or consultant of
the Company or an Affiliate.  The Participant acknowledges: (i) that
the Plan is discretionary in nature and may be suspended or terminated by the
Company at any time; (ii) that the grant of the shares is a one-time benefit
which does not create any contractual or other right to receive future grants of
shares, or benefits in lieu of shares; (iii) that all determinations with
respect to any such future grants, including, but not limited to, the times when
shares shall be granted, the number of shares to be granted, the purchase price,
and the time or times when each share shall be free from a lapsing repurchase or
forfeiture right, will be at the sole discretion of the Company; (iv) that the
Participant’s participation in the Plan is voluntary; (v) that the value of the
Shares is an extraordinary item of compensation which is outside the scope of
the Participant’s employment contract, if any; and (vi) that the Shares are not
part of normal or expected compensation for purposes of calculating any
severance, resignation, redundancy, end of service payments, bonuses,
long-service awards, pension or retirement benefits or similar
payments.

    

    10.           Notices.  Any
notices required or permitted by the terms of this Agreement or the Plan shall
be given by recognized courier service, facsimile, registered or certified mail,
return receipt requested, addressed as follows:

    

    If to the Company:

    

    Mandalay Media, Inc.

    2121 Avenue of the Stars

    Suite 2550

    Los Angeles, CA 90067

    Attn:  James
Lefkowitz

    

    
      
         

      

      
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    If to the
Participant:

    

    ____________________________________

    ____________________________________

    ____________________________________

    ____________________________________

    

    

    or to
such other address or addresses of which notice in the same manner has
previously been given.  Any such notice shall be deemed to have been
given on the earliest of receipt, one business day following delivery by the
sender to a recognized courier service, or three business days following mailing
by registered or certified mail.

    

    11.           Benefit of
Agreement.  Subject to the provisions of the Plan and the other
provisions hereof, this Agreement shall be for the benefit of and shall be
binding upon the heirs, executors, administrators, successors and assigns of the
parties hereto.

    

    12.           Governing
Law.  This Agreement shall be construed and enforced in
accordance with the laws of the State of Delaware, without giving effect to the
conflict of law principles thereof.  For the purpose of litigating any
dispute that arises under this Agreement, whether at law or in equity, the
parties hereby consent to exclusive jurisdiction in the State of California and
agree that such litigation shall be conducted in the state courts of State of
California or the federal courts of the United States for the District of Los
Angeles, California.

    

    13.           Severability.  If
any provision of this Agreement is held to be invalid or unenforceable by a
court of competent jurisdiction, then such provision or provisions shall be
modified to the extent necessary to make such provision valid and enforceable,
and to the extent that this is impossible, then such provision shall be deemed
to be excised from this Agreement, and the validity, legality and enforceability
of the rest of this Agreement shall not be affected thereby.

    

    14.           Entire
Agreement.  This Agreement, together with the Plan, constitutes
the entire agreement and understanding between the parties hereto with respect
to the subject matter hereof and supersedes all prior oral or written agreements
and understandings relating to the subject matter hereof.  No
statement, representation, warranty, covenant or agreement not expressly set
forth in this Agreement shall affect or be used to interpret, change or restrict
the express terms and provisions of this Agreement provided, however, in any
event, this Agreement shall be subject to and governed by the Plan.

    

    15.           Modifications and
Amendments; Waivers and Consents.  The terms and provisions of
this Agreement may be modified or amended as provided in the
Plan.  Except as provided in the Plan, the terms and provisions of
this Agreement may be waived, or consent for the departure therefrom granted,
only by written document executed by the party entitled to the benefits of such
terms or provisions.  No such waiver or consent shall be deemed to be
or shall constitute a waiver or consent with respect to any other terms or
provisions of this Agreement, whether or not similar.  Each such
waiver or consent shall be effective only in the specific instance and for the
purpose for which it was given, and shall not constitute a continuing waiver or
consent.

    

    16.           Consent of Spouse/Domestic
Partner.  If the Participant has a spouse or domestic partner
as of the date of this Agreement, the Participant’s spouse or domestic partner
shall execute a Consent of Spouse/Domestic Partner in the form of Exhibit A hereto,
effective as of the date hereof.  Such consent shall not be deemed to
confer or convey to the spouse or domestic partner any rights in the Granted
Shares that do not otherwise exist by operation of law or the agreement of the
parties.  If the Participant subsequent to the date hereof, marries,
remarries or applies to the Company for domestic partner benefits, the
Participant shall, not later than sixty (60) days thereafter, obtain his or her
new spouse/domestic partner’s acknowledgement of and consent to the existence
and binding effect of all restrictions contained in this Agreement by having
such spouse/domestic partner execute and deliver a Consent of Spouse/Domestic
Partner in the form of Exhibit
A.

    

    
      
         

      

      
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    17.           Counterparts.  This
Agreement may be executed in one or more counterparts, and by different parties
hereto on separate counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.

    

    18.           Data
Privacy.  By entering into this Agreement, the Participant: (i)
authorizes the Company and each Affiliate, and any agent of the Company or any
Affiliate administering the Plan or providing Plan record keeping services, to
disclose to the Company or any of its Affiliates such information and data as
the Company or any such Affiliate shall request in order to facilitate the grant
of Shares and the administration of the Plan; (ii) waives any data privacy
rights he or she may have with respect to such information; and (iii) authorizes
the Company and each Affiliate to store and transmit such information in
electronic form.

    

    [THE NEXT
PAGE IS THE SIGNATURE PAGE]

     

    
      
         

      

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

     

    
      
        
          
            	 	Mandalay
      Media, Inc.	 
	 	 	 	 
	
                     

                  	
                    By:
      

                  	 	 
	 	Name:	 	 
	 	      
                    Title:

                  	 	 
	 	 	 	 

          

        

      

    

     

    
      
        
          
            
              
                	 	Participant:	 
	 	 	 	 
	 	 	 
	 	Print
      Name:	 
	 	 	 	 

              

            

          

        

      

    

    

    
      
         

      

      
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    EXHIBIT
A

    

    CONSENT OF SPOUSE/DOMESTIC
PARTNER

    

    I,
____________________________, spouse or domestic partner of
_________________________, acknowledge that I have read the RESTRICTED STOCK
AGREEMENT dated as of March [__], 2009 (the “Agreement”) to which this Consent
is attached as Exhibit A and that I know its contents.  Capitalized
terms used and not defined herein shall have the meanings assigned to such terms
in the Agreement.  I am aware that by its provisions the Granted
Shares granted to my spouse/domestic partner pursuant to the Agreement are
subject to a Lapsing Forfeiture Right in favor of Mandalay Media, Inc. (the
“Company”) and that, accordingly, I may be required to forfeit to the Company
any or all of the Granted Shares of which I may become possessed as a result of
a gift from my spouse/domestic partner or a court decree and/or any property
settlement in any domestic litigation.

    

    I hereby
agree that my interest, if any, in the Granted Shares subject to the Agreement
shall be irrevocably bound by the Agreement and further understand and agree
that any community property interest I may have in the Granted Shares shall be
similarly bound by the Agreement.

    

    I agree
to the Lapsing Forfeiture Right described in the Agreement and I hereby consent
to the forfeiture of the Granted Shares to the Company by my spouse/domestic
partner or my spouse/domestic partner’s legal representative in accordance with
the provisions of the Agreement.  Further, as part of the
consideration for the Agreement, I agree that at my death, if I have not
disposed of any interest of mine in the Granted Shares by an outright bequest of
the Granted Shares to my spouse or domestic partner, then the Company shall have
the same rights against my legal representative to exercise its rights to the
Granted Shares with respect to any interest of mine in the Granted Shares as it
would have had pursuant to the Agreement if I had acquired the Granted Shares
pursuant to a court decree in domestic litigation.

    

    I
AM AWARE THAT THE LEGAL, FINANCIAL AND RELATED MATTERS CONTAINED IN THE
AGREEMENT ARE COMPLEX AND THAT I AM FREE TO SEEK INDEPENDENT PROFESSIONAL
GUIDANCE OR COUNSEL WITH RESPECT TO THIS CONSENT.  I HAVE EITHER
SOUGHT SUCH GUIDANCE OR COUNSEL OR DETERMINED AFTER REVIEWING THE AGREEMENT
CAREFULLY THAT I WILL WAIVE SUCH RIGHT.

    

    Dated as
of the _______ day of ________________, 2009.

    
       

      
        
          
            
              
                
                  	 	 	 
	 	 	 	 
	 	 	 
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      Name:	 
	 	 	 	 

                

              

            

          

        

      

    

    

    
      
         

      

      
        A-1

        
          

        

      

      
         

      

    

     

    EXHIBIT
B

    

    Election
to Include Gross Income in Year

    of
Transfer Pursuant to Section 83(b)

    of
the Internal Revenue Code of 1986, as amended

    

    In accordance with Section 83(b) of the
Internal Revenue Code of 1986, as amended (the “Code”), the undersigned hereby
elects to include in his gross income as compensation for services the excess,
if any, of the fair market value of the property (described below) at the time
of transfer over the amount paid for such property.

    

    The
following sets for the information required in accordance with the Code and the
regulations promulgated hereunder:

    

    
      	
              1.

            	
              The
      name, address and social security number of the undersigned
      are:

            

    

    

    
      	
               
      

            	
              Name:
      _____________________

            

    

    
      	
               
      

            	
              Address:
      ____________________

            

    

    
      
        	
                 
      

              	
                ____________________

              
	 	Social
      Security No.: ________________

      

    

     

    
      	
              2.

            	
              The
      description of the property with respect to which the election is being
      made is as follows:

            

    

    

    
      	
               
      

            	
              ____________
      (___) shares (the “Shares”) of Common Stock, $0.0001 par value per share,
      of Mandalay Media, Inc., a Delaware corporation (the
      “Company”).

            

    

    

    
      	
              3.

            	
              This
      election is made for the calendar year 2009, with respect to the transfer
      of the property to the Taxpayer on March [__],
  2009.

            

    

    

    
      	
              4.

            	
              Description
      of restrictions:  The property is subject to the following
      restrictions:

            

    

    

    
      	
               
      

            	
              In
      the event taxpayer’s employment with the Company or an Affiliate is
      terminated, the taxpayer shall forfeit the Shares as set forth
      below:

            

    

    

    
      	
               
      

            	
              A.

            	
              If
      the Participant’s Termination is prior to March [__], 2009, the pro rata
      portion of the Granted Shares based on the number of days elapsed from
      March [___], 2009 to March [___], 2010 [plus an additional ___ days ]
      (rounded down to the nearest whole share) shall vest, and the
      remaining Granted Shares shall be forfeited to the
  Company.

            

    

    

    
      	
              5.

            	
              The
      fair market value at time of transfer (determined without regard to any
      restrictions other than restrictions which by their terms will never
      lapse) of the property with respect to which this election is being made
      was not more than $[__] per Share.

            

    

    

    
      	
              6.

            	
              The
      amount paid by taxpayer for said property was $0.0001 per
      Share.

            

    

    

    
      	
              7.

            	
              A
      copy of this statement has been furnished to the
  Company.

            

    

    

    Signed
this ____ day of ______________, 2009.

    
      
         

        
          
            
              
                
                  
                    	 	 	 
	 	 	 	 
	 	 	 
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      Name:	 
	 	 	 	 

                  

                

              

            

          

        

      

      

      
        
           

        

        
          B-1EXHIBIT 10.1

    
      
        
          
            
              AMENDED AND RESTATED
EMPLOYMENT AGREEMENT

               

              THIS
AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the "Agreement"), between The Bank of
the Pacific, a Washington business corporation ("The Bank"), and Dennis A.
Long ("Executive"), initially entered into effective July 1, 2005, is being
amended and restated as set forth herein effective December 29,
2008.

               

              RECITALS

               

              A. The
Bank of the Pacific is a Washington banking corporation.  The Bank is
engaged in the business of commercial banking in Grays Harbor County, Pacific
County, Skagit County, Whatcom County, and Wahkiakum County,
Washington.  The Bank also engages in business in Oregon
counties.

               

              B. The
Executive represents that he has considerable experience, expertise and training
in management related to banking and services offered by The
Bank.  The Bank desires and intends to employ the Executive pursuant
to the terms and conditions set forth in this Agreement.

               

              C. Both
The Bank and the Executive have read and understand the terms and provisions set
forth in this Agreement, and have been afforded a reasonable opportunity to
review this Agreement and to consult with an attorney.

               

              AGREEMENT

               

              The
parties agree as follows:

               

              1. Employment.  The
Bank will employ the Executive for the Term, except as specifically stated
herein, and the Executive accepts employment with The Bank on the terms and
conditions set forth in this Agreement.  The Executive's title will be
"Chief Executive Officer" for The Bank.

               

              2. Effective Date and
Term.

               

              (a) Effective
Date.  This Agreement is effective as of the 1st day of
July, 2005.

               

              (b) Term.  The
initial term of this Agreement is three years (36 months), beginning on the
Effective Date stated in paragraph 2(a), and shall automatically renew for
an additional term of one year on each anniversary date of the Agreement, so as
to create a three-year term on each anniversary date, unless notice of
termination is provided by either party pursuant to
paragraph 5(a).

               

              3. Duties.  The
Executive will serve as the Chief Executive Officer for The Bank and faithfully
and diligently perform the duties assigned to the Executive by The Bank's Board
of Directors.  The Executive will use his best efforts to perform his
duties and will devote all his working time and attention to these
duties.  These duties will include, without limitation, the
following:

               

              
                
                  
                  

                

                
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              (a) Company
Performance.  The Executive will be responsible for all aspects
of The Bank's performance, including, without limitation, directing so that
daily operational and managerial matters are performed in a manner consistent
with The Bank's policies.  These duties will also include formulating
and implementing The Bank's expansion strategies, performing all tasks in
connection with The Bank's management and affairs that are normal and customary
to the Chief Executive Officer's position.

               

              (b) Modification of
Duties.  The Executive will perform such other duties as may be
appropriate to his office and as may be prescribed from time to time by The
Bank's Board of Directors.  New duties and responsibilities prescribed
to the Executive will be consistent with the Executive's position as The Bank's
Chief Executive Officer and shall not include immoral or unlawful
acts.

               

              4. Compensation.

               

              (a) Salary.  Initially,
the Executive will receive an annualized salary of $181,900 per year, to be paid
at regular intervals by The Bank in accordance with its regular payroll
schedules.  The Executive's salary will be subject to annual review
and adjustment as set forth in paragraph 4(g).

               

              (b) Director
Fees.  As a Director of The Bank or its affiliates, Executive
will receive director fees, including an annual retainer and for regular meeting
attendance.

               

              (c) Incentive
Compensation.  Executive will be eligible to participate in The
Bank's approved incentive plan.  A disinterested majority of The
Bank's Board of Directors will determine the amount of the bonus pool, if any,
based on the profitability, safety, and soundness of The Bank.  The
Executive's bonus, if any, will reflect the Executive's performance in his area
of responsibility and his contribution to the overall performance of The Bank
during the year, as determined in the sole discretion of The Bank's Board of
Directors.  No incentive compensation bonus shall be paid for any
calendar year or portion thereof, in which this Agreement is terminated, or in
which notice of termination is given, regardless of reasons for termination, and
regardless of which party terminates this Agreement.  The Executive
will also be entitled to participate in stock bonus or option plans generally
available to senior executives of The Bank.

               

              (d) Standard
Benefits.  The Bank will provide to the Executive the standard
Executive benefits provided in accordance with The Bank's benefit plans and
policies, including but not limited to health insurance, disability insurance,
life insurance and five weeks of paid vacation per year accrued in accordance
with The Bank's benefit plans and policies.  The Executive also will
be entitled to participate in retirement plans, including 401(k)
plans.

               

              (e) Automobile.  The
Bank will provide the Executive with the use of an automobile, of a model
typically appropriate for the performance of the services by a
similarly-situated executive.

               

              (f) Expenses.  The
Bank will reimburse the Executive for all reasonable expenses that the Executive
may incur in the performance of his duties including monthly country club
dues.  The Executive will request reimbursement and provide
documentation of such expenses within a reasonable time, but no later than
90 days after the expense has been incurred.

               

              
                
                  
                  

                

                
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              (g) Annual Review and
Adjustment.  The Executive's compensation as set forth in this
paragraph 4(a), will be subject to annual review and adjustment by a
disinterested majority of The Bank's Board of Directors or Compensation
Committee.  In no case, however, will the Executive's salary, vacation
and expense reimbursement be less than the amounts set forth in
paragraphs 4(a)-(f).

               

              5. Termination.

               

              (a) Notice of
Termination.  Either party may unilaterally terminate this
Agreement for any reason by providing the other party with written notice of the
termination no less than 90 days prior to the termination
date.

               

              (b) Termination by The
Bank.  In the event that The Bank provides the Executive with a
notice of termination without cause under  paragraph 5(a), The
Bank will pay to the Executive an amount equal to the salary he would have
received from the date of termination through the end of the then-current
Term.  Such payment will be made in equal monthly payments beginning
on the 15th day of
the calendar month immediately following the termination date and ending on the
date which is the 15th day of
the third calendar month of the calendar year immediately following the
termination date.  All forfeiture provisions affecting restricted
stock awards and all vesting requirements affecting stock options shall lapse or
be deemed fully completed.

               

              (c) Termination by the
Executive.  If the Executive voluntarily terminates employment
with The Bank, other than for "good reason" as provided in paragraph 5(f),
the Executive will be entitled to salary through the date of termination and to
such other benefits as may be provided under the terms of The Bank benefit
plans.  In the event the Executive seeks to terminate this Agreement
without providing at least 90 days' written notice prior to the termination
date, the Executive will pay to The Bank liquidated damages as
follows:  (i) in the event the Executive provides notice of
termination 29 days or less prior to the termination date, the Executive
shall pay The Bank $25,000 in liquidated damages; (ii) in the event the
Executive provides notice of termination at least 30 days but not more than
59 days prior to the termination date, the Executive shall pay The Bank
$20,000 in liquidated damages; (iii) in the event the Executive provides
notice of termination at least 60 days but not more than 89 days prior
to termination date, the Executive shall pay to The Bank $15,000 in liquidated
damages.

               

              (d) Termination by The Bank for
Cause.  Notwithstanding paragraph 4(a), The Bank may
immediately terminate this Agreement without advance notice if the termination
is for cause.  For purposes of this Agreement, "cause" means
dishonesty; fraud; commission of a felony or of a crime involving moral
turpitude; deliberate violation of statutes, regulations, or orders pertaining
to financial institutions or reckless disregard of such statutes, regulations,
or orders; destruction or theft of property or assets of The Bank or its
customers; physical attack of a fellow employee or a customer; intoxication at
work; use of narcotics or alcohol to an extent that materially impairs
Executive's performance of his duties; willful malfeasance or gross negligence
in the performance of Executive's duties; violation of law in the course of
employment that has a material adverse impact on The Bank, its employees, or its
customers; Executive's refusal to perform Executive's duties; Executive's
refusal to follow reasonable instructions or directions; misconduct materially
injurious to The Bank; significant neglect of duty; or any material breach of
Executive's duties or obligations to The Bank that results in material harm to
The Bank.  If termination occurs under this paragraph, the Executive
will be entitled to receive only the salary earned through the date this
Agreement is terminated, and except as otherwise provided by law, participation
in benefit plans ceases upon termination of this Agreement.

               

              
                
                  
                  

                

                
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              (e) Death or
Disability.  Notwithstanding paragraph 5(a), this
Agreement will terminate immediately upon:

               

              (i) The
Executive's death; or

               

              (ii) If
the Executive is unable to perform his duties and obligations under this
Agreement for a period of 90 days as a result of a disability that
substantially limits one or more of his major life activities.

               

              If
termination occurs under this paragraph 5(e):  (A) the
Executive or his estate will be entitled to receive only the salary earned
through the date this Agreement is terminated; (B) except as otherwise
provided by law, participation in benefit plans ceases upon termination of this
Agreement; and (C) as of such termination date, all vesting requirements
affecting outstanding stock options shall lapse or be deemed fully
completed.

               

              (f) Termination Related to a
Change in Control.  This paragraph will apply to any
termination related to a Change in Control, as set forth herein.

               

              (i)
"Change in Control" means a change "in the ownership or effective control" or
"in the ownership of a substantial portion of the assets" of The Bank, within
the meaning of Section 280G of the Internal Revenue Code.  An
initial public offering by The Bank will not, however, be deemed to be a Change
in Control under this Agreement.

               

              (ii)
Termination by The
Bank.  In the event The Bank or its successors in interest
terminates this Agreement within 24 months following a Change in Control
for reasons other than for cause pursuant to paragraph 5(d), or as the
result of the Executive's death or disability pursuant to paragraph 5(e),
The Bank will pay the Executive 36 times the base compensation received by
the Executive during the most recent calendar month ending on or prior to the
effective date of termination, less statutory payroll
deductions.  Payment under this paragraph shall be made in accordance
with The Bank's ordinary payroll policies and procedures in equal monthly
payments beginning on the 15th day of
the calendar month immediately following the termination date and ending on the
date which is the 15th day of
the third calendar month of the calendar year immediately following the
termination date.

               

              (iii)
Change in Assignment
Related to Change in Control.  If, within 24 months
following a Change in Control, the Executive's assignment with The Bank is
changed in a way that results in a material diminution of Executive's authority,
duties, or responsibilities, without the Executive's express written consent,
then any termination by Executive within 90 days of such reassignment will
be deemed to have been for "good reason" and the provisions of
paragraph 5(f)(ii) shall apply.

               

              
                
                  
                  

                

                
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              (iv)
Limitations on
Payments Related to Change in Control.  Notwithstanding the
foregoing, the payment described in paragraph 5(f)(ii) shall be
automatically reduced to an amount that is less than the amount that would cause
it to be a "parachute payment" within the meaning of Section 280G(b)(2)(A)
of the Internal Revenue Code.

               

              6. Compliance with IRC
Section 409A.  To the extent required by IRC
Section 409A, and regulations thereunder, payment of severance benefits to
Executive under any provision of paragraph 5 of this Agreement will not be
paid, or commenced, until the expiration of six months following the date of
termination of Executive's employment with Corporation.  If monthly
payments are deferred pursuant to this paragraph, all such deferred amounts will
be paid in a lump sum on the first business day following the expiration of the
six-month period.

               

              7. Confidentiality.  The
Executive will not, after signing this Agreement, including during and after its
Term, disclose to any other person or entity any confidential information
concerning The Bank or its business operations or customers, or use for his own
purposes or permit or assist in the use of such confidential information by
third parties unless The Bank consents to the use or disclosures of their
respective information, or disclosure is required by law or court
order.  The provisions of this paragraph survive the termination of
the Executive's employment by The Bank.

               

              8. Noncompetition.  During
the Term and for 24 months after the Executive's employment with The Bank
ends, the Executive will not become involved with a Competing Business or serve,
directly or indirectly, a Competing Business in any
matter.  "Competing Business" means any company that competes with or
will compete with The Bank in Grays Harbor, Pacific, Wahkiakum, Whatcom, and
Skagit Counties, or any other Washington or Oregon county in which The Bank
maintains a banking office(s) at the time of the termination of this
Agreement.  "Competing Business" includes, without limitation, any
existing or newly formed financial institution or trust company.

               

              9. Enforcement.  The
Bank and the Executive agree that, in light of all of the facts and
circumstances of the relationship between The Bank and the Executive, the
agreements referred to in paragraphs 5(a), 7, and 8 are fair and
reasonably necessary for the protection of The Bank's confidential information,
goodwill and other protectible interests.  The parties acknowledge and
agree that the time and expense involved in proving in any forum the actual
damage or loss suffered by The Bank if there is a breach of
paragraphs 5(a), 7, or 8 make this case appropriate for liquidated
damages.  Accordingly, The Bank and the Executive agree that the
following schedule of liquidated damages is reasonable and fair, and shall be
the amount of damages which the Executive shall pay to The Bank for each
separate breach of paragraphs 5(a), 7, or 8 by the
Executive:

               

              (a) for a
breach of paragraph 5(a), up to the sum of $25,000 as described in
paragraph 5(c);

               

              
                
                  
                  

                

                
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              (b) for a
breach of paragraph 7, the sum of $100,000;

               

              (c) for a
breach of paragraph 8, the sum of $250,000.

               

              For
purposes of paragraph 8, a "separate breach" shall be deemed to have
occurred with each Competing Business with which the Executive becomes involved
or serves in violation of paragraph 8.

               

              Neither
the breach of paragraphs 5(a), 7, or 8, nor the payment of liquidated
damages by the Executive, shall affect the continuing validity or enforceability
of this Agreement, or The Bank's right to seek and obtain injunctive
relief.  If a court of competent jurisdiction should decline to
enforce any of these covenants and agreements, the Executive and The Bank hereby
stipulate that the Court shall reform these provisions to restrict the
Executive's use of confidential information and the Executive's ability to
compete with The Bank to the maximum extent, in time, scope of activities, and
geography, as the court finds enforceable.

               

              10. Adequate
Consideration.  The Executive specifically acknowledges the
receipt of adequate consideration for the covenants contained in
paragraphs 5(a), 7, and 8, and that The Bank is entitled to require
him to comply with these paragraphs.  These paragraphs will survive
termination of this agreement.  The Executive represents that if his
employment is terminated, whether voluntarily or involuntarily, the Executive
has experience and capabilities sufficient to enable the Executive to obtain
employment in areas which do not violate this Agreement and that The Bank's
enforcement of a remedy by way of injunction will not prevent the Executive from
earning a livelihood.

               

              11. Miscellaneous
Provisions.  This Agreement constitutes the entire
understanding between the parties concerning its subject matter.  This
Agreement will bind and inure to the benefit of The Bank's and the Executive's
heirs, legal representatives, successors and assigns.  This Agreement
may be modified only through a written instrument signed by both
parties.  This Agreement will be governed and construed in accordance
with Washington law, except that certain matters may be governed by federal
law.  Venue for enforcement of any terms of this Agreement shall be in
Grays Harbor County, Washington Superior Court.

               

              Signed as
of December 29, 2008:

               

            

          

        

      

    

    
      	THE BANK OF THE
      PACIFIC              	EXECUTIVE
	 	 
	      
              /s/
      Gary C.
      Forcum                           
      

            	      
              /s/
      Dennis A.
      Long                   
      

            
	
              Gary
      C. Forcum, Chairman

            	
              Dennis A.
      Long

            

    

     

    
      
        
        

      

      
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