Document:

Stipulation and Consent to Issuance of Order to Cease and Desist - Bank

 Exhibit 10.4 
 UNITED STATES OF AMERICA 
 Before the 
 OFFICE OF THRIFT SUPERVISION 
  

									
	 	 	)	  		  	
	 In the Matter of
	 	)	  		  	Order No.:	  	SE-08-013
		 	)	  		  	
		 	)	  		  	
	BANKUNITED, FSB	 	)	  		  	
	Coral Gables, Florida	 	)	  		  	Effective Date: September 19, 2008
		 	)	  		  	
		 	)	  		  	
	OTS Docket No. 08045	 	)	  		  	
	 	 	)	  		  	

 STIPULATION AND CONSENT TO ISSUANCE OF ORDER TO CEASE AND DESIST 
 WHEREAS, the Office of Thrift Supervision (OTS), acting by and through its Regional Director for the Southeast Region (Regional Director), and
based upon information derived from the exercise of its regulatory and supervisory responsibilities, has informed BankUnited, FSB, Coral Gables, Florida, OTS Docket No. 08045 (Association), that the OTS is of the opinion that grounds exist to
initiate an administrative proceeding against the Association pursuant to 12 U.S.C. § 1818(b); 
 WHEREAS, the Regional Director,
pursuant to delegated authority, is authorized to issue Orders to Cease and Desist where a savings association has consented to the issuance of an order; and 
 WHEREAS, the Association desires to cooperate with the OTS to avoid the time and expense of such administrative cease and desist proceeding by entering into this Stipulation and Consent to the Issuance of Order
to Cease and Desist (Stipulation) and, without admitting or denying that such grounds exist, but only admitting the statements and conclusions in Paragraph 1 below concerning Jurisdiction, hereby stipulates and agrees to the following terms:

	1.	Jurisdiction. 

 a. The Association is a
“savings association” within the meaning of 12 U.S.C. § 1813(b) and 12 U.S.C. § 1462(4). Accordingly, the Association is “an insured depository institution” as that term is defined in 12 U.S.C. § 1813(c); and

 b. Pursuant to 12 U.S.C. § 1813(q), the Director of the OTS is the “appropriate Federal banking agency” with jurisdiction
to maintain an administrative enforcement proceeding against a savings association. Therefore, the Association is subject to the authority of the OTS to initiate and maintain an administrative cease and desist proceeding against it pursuant to 12
U.S.C. § 1818(b)(1). 
  

	2.	OTS Findings of Fact.  

 Based on its
January 31, 2008 Report of Examination of the Association, the OTS finds that the Association has engaged in unsafe and unsound practices that have resulted in the Association being in an unsatisfactory condition, primarily due to the rising
delinquencies and defaults in its payment option arm loan portfolio, a significant portion of which was originated on a “stated income” basis. The deterioration in this portfolio has resulted in the need for greater levels of capital and
allowance for loan and lease losses. 
  

	3.	Consent. 

 The Association consents to the
issuance by the OTS of the accompanying Order to Cease and Desist (Order). The Association further agrees to comply with the terms of the Order upon the Effective Date of the Order and stipulates that the Order complies with all requirements of law.

  

 2 

	4.	Finality. 

 The Order is issued by the OTS
under 12 U.S.C. § 1818(b) and upon the Effective Date it shall be a final order, effective and fully enforceable by the OTS under the provisions of 12 U.S.C. § 1818(i). 
  

	5.	Waivers. 

 The Association waives the
following: 
 a. The right to be served with a written notice of the OTS’s charges against it as provided by 12 U.S.C. § 1818(b) and
12 C.F.R. Part 509; 
 b. The right to an administrative hearing of the OTS’s charges as provided by 12 U.S.C. § 1818(b) and 12
C.F.R. Part 509; 
 c. The right to seek judicial review of the Order, including, without limitation, any such right provided by 12 U.S.C.
§ 1818(h), or otherwise to challenge the validity of the Order; and 
 d. Any and all claims against the OTS, including its employees
and agents, and any other governmental entity for the award of fees, costs, or expenses related to this OTS enforcement matter and/or the Order, whether arising under common law, federal statutes or otherwise. 
  

	6.	OTS Authority Not Affected.  

 Nothing in
this Stipulation or accompanying Order shall inhibit, estop, bar, or otherwise prevent the OTS from taking any other action affecting the Association if at any time the OTS deems it appropriate to do so to fulfill the responsibilities placed upon
the OTS by law. 
  

	7.	Other Governmental Actions Not Affected. 

 The Association acknowledges and agrees that its consent to the issuance of the Order is solely for the purpose of resolving the 

  

 3 

 
matters addressed herein, consistent with Paragraph 6 above, and does not otherwise release, discharge, compromise, settle, dismiss, resolve, or in any way
affect any actions, charges against, or liability of the Association that arise pursuant to this action or otherwise, and that may be or have been brought by any governmental entity other than the OTS. 
  

	8.	Miscellaneous. 

 a. The laws of the United
States of America shall govern the construction and validity of this Stipulation and of the Order; 
 b. If any provision of this Stipulation
and/or the Order is ruled to be invalid, illegal, or unenforceable by the decision of any Court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions hereof shall not in any way be affected or impaired
thereby, unless the Regional Director in his or her sole discretion determines otherwise; 
 c. All references to the OTS in this Stipulation
and the Order shall also mean any of the OTS’s predecessors, successors, and assigns; 
 d. The section and paragraph headings in this
Stipulation and the Order are for convenience only and shall not affect the interpretation of this Stipulation or the Order; 
 e. The terms
of this Stipulation and of the Order represent the final agreement of the parties with respect to the subject matters thereof, and constitute the sole agreement of the parties with respect to such subject matters; and 
 f. The Stipulation and Order shall remain in effect until terminated, modified, or suspended in writing by the OTS, acting through its Regional Director
or other authorized representative. 
  

 4 

	9.	Signature of Directors/Board Resolution.  

 Each Director signing this Stipulation attests that he or she voted in favor of a Board Resolution authorizing the consent of the Association to the issuance of the Order and the execution of the Stipulation. 
 WHEREFORE, the Association, by its directors, executes this Stipulation. 
  

									
	 	 	 	 	Accepted by:
			
	BANKUNITED, FSB	 	 	 	OFFICE OF THRIFT SUPERVISION
	Coral Gables, Florida	 	 	 	 
					
	By:	 	 /s/ Alfred A. Camner
	 		 	By:	 	 /s/ John E. Ryan

		 	Alfred A. Camner	 		 		 	John E. Ryan
		 	Chairman of the Board	 		 		 	Southeast Regional Director
					
		 		 		 	Date:	 	See Effective Date on page 1
			
	 /s/ Lawrence H. Blum
	 		 	 /s/ Tod N. Aronovitz

	Lawrence H. Blum, Vice Chairman	 		 	Tod N. Aronovitz, Director
			
	 /s/ Alan M. Bernkrant
	 		 	 /s/ Lauren R. Camner

	Alan M. Bernkrant, Director	 		 	Lauren R. Camner, Director
			
	 /s/ Marc D. Jacobson
	 		 	 /s/ Hardy C. Katz

	Marc D. Jacobson, Director	 		 	Hardy C. Katz, Director
			
	 /s/ Neil H. Messinger
	 		 	 /s/ Ramiro A. Ortiz

	Neil H. Messinger, M.D., Director	 		 	Ramiro A. Ortiz, Director
			
	 /s/ Albert E. Smith
	 		 	 /s/ Bradley S. Weiss

	Albert E. Smith, Ph.D., Director	 		 	Bradley S. Weiss, Director

  

 5exhibit_10-1.htm

    
      

    

    Exhibit
10.1

    

    MEDIZONE
INTERNATIONAL, INC.

    2008
EQUITY COMPENSATION PLAN

    

    Medizone
International, Inc., a Nevada corporation, (the "Corporation"), hereby adopts
this Equity Compensation Plan (the "Plan"), under which Common Stock in Lieu of
Cash Compensation Awards (“Awards”) of the Corporation may be granted from time
to time to employees, directors and consultants of the Corporation or its
subsidiaries, if any.

    

    SECTION 1. GENERAL PURPOSE
OF THE PLAN; DEFINITIONS

    

    The Plan
is intended to aid the Corporation in maintaining and developing a management
team, attracting qualified officers and employees capable of assisting in the
future success of the Corporation, and rewarding those individuals who have
contributed to the success of the Corporation. It is designed to aid the
Corporation in retaining the services of executives and employees and in
attracting new personnel when needed for future operations and growth and to
provide such personnel with an incentive to remain employees of the Corporation,
to use their best efforts to promote the success of the Corporation's business,
and to provide them with an opportunity to obtain or increase a proprietary
interest in the Corporation. It is also designed to permit the Corporation to
reward those individuals who are not employees of the Corporation but who are
perceived by management as having contributed to the success of the Corporation
or who are important to the continued business and operations of the
Corporation. The above aims will be effectuated through the granting awards,
subject to the terms and conditions of this Plan. Stock granted pursuant to this
Plan, may be registered on Form S-8 or other appropriate form of registration
statement.

    

    A.
RULE 16B-3 PLAN.

    

    The
Corporation is subject to the reporting requirements of  the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and therefore
the Plan is intended to comply with all applicable conditions of Rule 16b-3 (and
all subsequent revisions thereof) promulgated under the Exchange Act. To the
extent any provision of the Plan or action by the Committee or the Board of
Directors or Committee fails to so comply, it shall be deemed null and void, to
the extent permitted by law and deemed advisable by the Committee. In addition,
the Committee or the Board of Directors may amend the Plan from time to time as
it deems necessary in order to meet the requirements of any amendments to Rule
16b-3 without the consent of the shareholders of the Corporation.

    

    B.
EFFECTIVE DATE OF PLAN.

    

    The
effective date of this Plan shall be September 1, 2008 (the "Effective
Date").

    

    C.
DEFINITIONS.

    

    The
following definitions shall apply to this Plan

    

    "Act"
means the Securities Exchange Act of 1934, as amended from time to
time.

    

    "Administrator"
is defined in Section 2(a).

    

    "Affiliate"
means any parent corporation and any subsidiary corporation. The term "parent
corporation" means any corporation (other than the Corporation) in an unbroken
chain of corporations ending with the Corporation if, at the time of the action
or transaction, each of the corporations other than the Corporation owns
stock possessing 50% or more of the total combined voting power of all classes
of stock in one of the other corporations in the chain. The term "subsidiary
corporation" means any corporation (other than the Corporation) in an unbroken
chain of corporations beginning with the Corporation if, at the time of the
action or transaction, each of the corporations other than the last corporation
in the unbroken chain owns stock possessing 50% or more of the total combined
voting power of all classes of stock in one of the other corporations in the
chain.

     

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    
SECTION 1. GENERAL PURPOSE OF THE PLAN;
DEFINITIONS -
continued

     

    "Agreement"
means, individually or collectively, any agreement entered into pursuant to the
Plan pursuant to which Stock is granted to a participant.

    

    "Board"
means the Board of Directors of the Corporation as constituted from time to
time.

    

    "Cause"
shall mean, for purposes of whether and when a participant has incurred a
Termination of Employment for Cause: (i) any act or omission which permits the
Corporation to terminate the written agreement or arrangement between the
participant and the Corporation or a Subsidiary or Parent for Cause as defined
in such agreement or arrangement; or (ii) in the event there is no such
agreement or arrangement or the agreement or arrangement does not define the
term "cause," then Cause shall mean an act or acts of dishonesty by the
participant resulting or intending to result directly or indirectly in gain to
or personal enrichment of the participant at the Corporation's expense and/or
gross negligence or willful misconduct on the part of the
participant.

    

    "Change
in Control" means, for purposes of this Plan there shall be consummated (i) any
consolidation or merger of the Corporation in which the Corporation is not the
continuing or surviving corporation or pursuant to which shares of the
Corporation's common stock would be converted into cash, securities or other
property, other than a merger of the Corporation in which the holders of the
Corporation's common stock immediately prior to the merger have substantially
the same proportionate ownership of common stock of the surviving corporation
immediately after the merger; or (ii) any sale, lease, exchange or other
transfer (in one transaction or a series of related transactions) of all or
substantially all of the assets of the Corporation; or  the
shareholders of the Corporation shall approve any plan or proposal for the
liquidation or dissolution of the Corporation.

    

    "Code"
means the Internal Revenue Code of 1986, as amended from time to time, and any
successor Code, and related rules, regulations and interpretations.

    

    "Common
Stock" or "Stock" means the Common Stock, par value per share of the Corporation
whether presently or hereafter issued, or such other class of shares or
securities as to which the Plan may be applicable subject to adjustments
pursuant to Section 3.

    

    "Common
Stock in Lieu of Cash Compensation Award" means Awards granted pursuant to
Section 5.

    

    "Corporation"
means Medizone International, Inc., a Nevada corporation, and any successor or
assignee company corporations into which the Corporation may be merged, changed
or consolidated; any company for whose securities the securities of the
Corporation shall be exchanged; and any assignee of or successor to
substantially all of the assets of the Corporation.

    

    "Director"
means any member of the Board of Directors of the Corporation or any Parent or
subsidiary of the Corporation that now exists or hereafter is organized or
acquired by or acquires the Corporation.

    

    "Effective
Date" means the date on which the Plan is initially approved by the Board of
Directors as set forth in Section 12.

    

    "Eligible
Persons" shall mean, with respect to the Plan, those persons who, at the time
that an Award is granted, are (i) officers, directors or employees of the
Corporation or Affiliate or (ii) attorneys, consultants or subcontractors of the
Corporation or affiliate.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    SECTION 1. GENERAL PURPOSE OF THE PLAN;
DEFINITIONS -
continued

     

    "Employee"
means any person employed on an hourly or salaried basis by the Corporation or
any Parent or Subsidiary of the Corporation that now exists or hereafter is
organized or acquired by or acquires the Corporation.

    

    "Fair
Market Value" means (i) if the Common Stock is not listed or admitted to trade
on a national securities exchange and if bid and ask prices for the Common Stock
are not furnished through NASDAQ or a similar organization, the value
established by the Committee, in its sole discretion, for purposes of the Plan;
(ii) if the Common Stock is listed or admitted to trade on a national securities
exchange or a national market system, the closing price of the Common Stock, as
published in the Wall Street Journal, so listed or admitted to
trade  on such date or, if there is no trading of the Common Stock on
such date, then the closing price of the Common Stock on the next
preceding  day on which there was trading in such shares; or (iii) if
the Common Stock is not listed or admitted to trade on a national securities
exchange or a national market system, the mean between the bid and ask price for
the Common Stock on such date, as furnished by the National Association of
Securities Dealers, Inc. through NASDAQ or a similar organization if NASDAQ is
no longer reporting such information. If trading in the stock or a price
quotation does not occur on the Date of Grant, the next preceding date on which
the stock was traded or a price was quoted will determine the fair market
value.

    

    "Non-Employee
Director" means a member of the Board who is not also an employee of the
Corporation or any Subsidiary as that term is defined in Rule 16b-3 under the
Exchange Act.

    

    "Plan"
means this Equity Compensation Plan as may be amended from time to
time.

    

    "Stock
Award" means Awards granted pursuant to Section 5.

    

    "Subsidiary"
means any corporation or other entity (other than the Corporation) in any
unbroken chain of corporations or other entities beginning with the Corporation
if each of the corporations or entities (other than the last corporation or
entity in the unbroken chain) owns stock or other interests possessing 50% or
more of the economic interest or the total combined voting power of all classes
of stock or other interests in one of the other corporations or entities in the
chain.

    

    "Ten
Percent Shareholder" means an individual who, at the time of the award, owns
Stock possessing more than 10% of the total combined voting power of all classes
of stock of the Corporation or of any Affiliate. An individual shall be
considered as owning the Stock owned, directly or indirectly, by or for his
brothers and sisters (whether by the whole or half blood), spouse, ancestors,
and lineal descendants; and Stock owned, directly or indirectly, by or for a
corporation, partnership, estate, or trust, shall be considered as being owned
proportionately by or for its shareholders, partners, or
beneficiaries.

    

    "Termination"
or "Termination of Employment" means the occurrence of any act or event whether
pursuant to an employment agreement or otherwise that actually or effectively
causes or results in the person's ceasing, for whatever reason, to be an officer
or employee of the Corporation or of any Subsidiary or Parent including, without
limitation, death, disability, dismissal, severance at the election of the
participant, retirement, or severance as a result of the discontinuance,
liquidation, sale or transfer by the Corporation or its Subsidiaries or Parent
of all businesses owned or operated by the Corporation or its Subsidiaries. A
Termination of Employment shall occur to an employee who is employed by a
Subsidiary if the Subsidiary shall cease to be a Subsidiary and the participant
shall not immediately thereafter become an employee of the Corporation or a
Subsidiary.

     

    "Subsidiary"
means any corporation 50% or more of the voting securities of which are owned
directly or indirectly by the Corporation at any time during the existence of
this Plan.

    

    In
addition, certain other terms used in this Plan shall have the definitions given
to them in the first place in which they are used.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    SECTION
2. ADMINISTRATION OF PLAN; ADMINISTRATOR AUTHORITY TO SELECT PARTICIPANTS
AND DETERMINE AWARDS

    

    A.  ADMINISTRATION

    

    The Plan
shall be administered by either the entire Board of Directors or a committee of
not fewer than two (2) Independent Directors (in either case, the
"Administrator"). Each member of the Committee shall be a "non-employee
director" within the meaning of Rule 16b-3(b)(3)(i) promulgated under the Act,
or any successor definition under said rule.

    

    If this
Plan is administered by the Committee, then a majority of the full Committee
constitutes a quorum for purposes of administering the Plan, and all
determinations of the Committee shall be made by a majority of the members
present at a meeting at which a quorum is present or by the unanimous written
consent of the Committee.

    

    If no
Committee has been appointed, members of the Board may vote on any matters
affecting the administration of the Plan or the grant of any Stock pursuant to
the Plan, except that no such member shall act on the granting of Stock to
himself, but such member may be counted in determining the existence of a quorum
at any meeting of the Board during which action is taken with respect to the
granting of Stock to him.

    

    The
interpretation and construction of the terms of the Plan by the Board or a duly
authorized committee shall be final and binding on all participants in the Plan
absent a showing of demonstrable error. No member of the Plan Administrator
shall be liable for any action taken or determination made in good faith with
respect to the Plan.

    

    B.  POWERS
OF ADMINISTRATOR.

    

    The
Administrator shall have the sole and exclusive power and authority to grant
Awards consistent with the terms of the Plan, including the power and authority:
to select the participants in this plan; establish the terms of the Stock
granted to each participants which may not be the same in each case; determine
the total number of shares of Stock to grant to a grantee, which may not be the
same amount to each Eligible Person in each case; make all other determinations
necessary or advisable under the Plan.

    

    The Plan
Administrator has the sole and absolute discretion to determine whether the
performance of an Eligible Person warrants an award under this Plan, and to
determine the amount of the award. The Plan Administrator has full and exclusive
power to construe and interpret this Plan, to prescribe and rescind rules and
regulations relating to this Plan, and take all actions necessary or advisable
for the Plan's administration. Any such determination made by the Plan
Administrator will be final and binding on all persons. (d) A member of the Plan
Administrator will not be liable for performing any act or making any
determination in good faith.  All decisions and interpretations of the
Administrator shall be made in the Administrator's sole and absolute discretion
and shall be final and binding on all persons, including the Corporation and
Plan participants.

    

    SECTION 3. STOCK ISSUABLE
UNDER THE PLAN; TERM OF PLAN; RECAPITALIZATIONS; MERGERS; SUBSTITUTE
AWARDS

    

    A.  STOCK
ISSUABLE.

    

    The
maximum number of shares of Stock reserved and available for issuance under the
Plan initially shall be 8,000,000 shares of Stock per year. In addition if any
portion of an Award is forfeited, cancelled, or reacquired by the Corporation,
satisfied without the issuance of Stock or otherwise terminated, the shares of
Stock underlying such portion of the Award shall be added back to the shares of
Stock available for issuance under the Plan. Subject to such overall limitation,
shares of Stock may be issued up to such maximum number pursuant to any type or
types of Award. The shares available for issuance under the Plan may be
authorized but unissued shares of Stock or shares of Stock reacquired by the
Corporation.

     

    
 

    
      
         

      

      
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    SECTION 3. STOCK ISSUABLE UNDER THE PLAN;
TERM OF PLAN; RECAPITALIZATIONS; MERGERS; SUBSTITUTE AWARDS -
continued

     

    B.
TERM OF PLAN.

    

    No Awards
shall be made after September 1, 2018.

    

    C.  RECAPITALIZATIONS.

    

    Subject
to the provisions of Section 11, if, through or as a result of any merger,
consolidation, sale of all or substantially all of the assets of the
Corporation, reorganization, recapitalization, reclassification, stock dividend,
stock split, reverse stock split or other similar transaction, the outstanding
shares of Stock are increased or decreased or are exchanged for a different
number or kind of shares or other securities of the Corporation, or additional
shares or new or different shares or other securities of the Corporation or
other non-cash assets are distributed with respect to such shares of Stock or
other securities, the Administrator may make an appropriate or proportionate
adjustment in (i) the maximum number of shares reserved for issuance under the
Plan, (ii) the number and kind of shares or other securities subject to any then
outstanding Awards under the Plan, The adjustment by the Administrator shall be
final, binding and conclusive. No fractional shares of Stock shall be issued
under the Plan resulting from any such adjustment, but the Administrator in its
discretion may make a cash payment in lieu of fractional shares.

    

    SECTION 4.
ELIGIBILITY

    

    Awards
under the Plan may be granted to employees, including officers, and directors of
the Corporation or its subsidiaries, as may be existing from time to time, and
to other individuals who are not employees of the Corporation, but performed
bona fide services to the Corporation, as may be deemed in the best interest of
the Corporation by the Board or the duly authorized Committee. These individuals
may be referred to as consultants or key persons.  Such services to
the Corporation or a subsidiary shall not be in connection with the offer or
sale of securities in a capital-raising transaction or for investor relations.
Such Awards shall be in the amounts, and shall have the rights and be subject to
the restrictions, as may be determined by the Board or a duly authorized
Committee, all as may be within the general provisions of this
Plan.

    

    Every
Eligible Person, as the Plan Administrator of the Corporation or any subsidiary
or Parent shall only be eligible to receive an Award if and as permitted by
applicable law and regulations. The Plan Administrator's Award to a participant
in any year does not require the Plan Administrator to make an Award to that
participant in any other year. Furthermore, the Plan Administrator makes
different Awards to different participants. The Plan Administrator may consider
such factors as it deems pertinent in selecting participants and in determining
the amount of their Stock, including, without limitation;

    

     (a)
the financial condition of the Corporation or its Subsidiaries;

    

     (b)
expected profits for the current or future years;

    

     (c)
the contributions of a prospective participant to the profitability or success
of the Corporation or its Subsidiaries; and

    

     (d)
the adequacy of the prospective participant's other compensation.

    

    Participants
may include persons to whom stock or other benefits previously were granted
under this or another plan of the Corporation or any Subsidiary.

     

     

    
      
         

      

      
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SECTION 5. COMMON STOCK IN
LIEU OF CASH COMPENSATION AWARDS

    

    A.
GRANTS OF COMMON STOCK PAYABLE IN LIEU OF CASH.

    

    The
Administrator may grant shares of Stock available for issuance under the Plan to
an eligible participant in lieu of cash compensation earned by the participant
with the consent of the participant, or under a short- or long-term incentive
plan of the Corporation (an "Other Incentive Plan).

    

    B.
DATE OF GRANT.

    

    Stock
granted in lieu of cash compensation shall be granted to each participant on the
date the waived cash compensation would otherwise be paid, provided, however,
that with respect to a participant who is subject to Section 16 of the Act, if
such grant date is not at least six months and one day from the date of the
election, the grant shall be delayed until the date which is six months and one
day from the date of the election (or the next following business day, if such
date is not a business day) to the extent necessary to conform to the
requirements for exempt purchases under Rule 16b-3 of the Act.

    

    C.
NUMBER OF SHARES.

    

    The
number of shares of Stock granted in lieu of cash compensation shall be
determined by dividing the amount of the waived cash compensation by the Fair
Market Value of the Stock on the date the Stock is granted. Such Stock shall be
granted for the whole number of shares so determined; the value of any
fractional share shall be paid in cash.

    

    SECTION 6. TAX
WITHHOLDING

     

    A.
PAYMENT BY PARTICIPANT.

    

    Each
participant shall, no later than the date as of which the value of an Award or
of any Stock or other amounts received there under first becomes includable in
the gross income of the participant for Federal income tax purposes, pay to the
Corporation, or make arrangements satisfactory to the Administrator regarding
payment of, any Federal, state, or local taxes of any kind required by law to be
withheld with respect to such income. The Corporation and its Subsidiaries
shall, to the extent permitted by law, have the right to deduct any such taxes
from any payment of any kind otherwise due to the participant. The Corporation's
obligation to deliver stock certificates to any participant is subject to and
conditioned on tax obligations being satisfied by the participant.

    

    B.
LIABILITY OF THE COMPANY.

    

    The
Corporation that is in existence or hereafter comes into existence shall not be
liable to any person for any tax consequences expected but not realized by any
person due to the grant of Stock.

    

    SECTION 7. TRANSFER, LEAVE
OF ABSENCE, ETC.

    

    For
purposes of the Plan, the following events shall not be deemed a termination of
employment:

    

    (a) a
transfer to the employment of the Corporation from a Subsidiary or from the
Corporation to a Subsidiary, or from one Subsidiary to another; or

    

    (b) an
approved leave of absence for military service or sickness, or for any other
purpose approved by the Corporation, if the employee's right to re- employment
is guaranteed either by a statute or by contract or under the written policy
pursuant to which the leave of absence was granted or if the Administrator
otherwise so provides in writing.

     

     

    
      
         

      

      
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SECTION 8. AMENDMENTS AND
TERMINATION

    

    The Board
of Directors of the Corporation may amend, terminate or suspend this Plan at any
time, in its sole and absolute discretion; provided, however, that to the extent
required to qualify this Plan under Rule 16b-3 promulgated under Section 16 of
the Exchange Act, no amendment that would (a) materially increase the number of
shares of Stock that may be issued under this Plan, (b) materially modify the
requirements as to eligibility for participation in this Plan, or (c) otherwise
materially increase the benefits accruing to participants under this Plan, shall
be made without the approval of the Corporation's shareholders. Subject to the
preceding sentence, the Board of Directors shall have the power to make any
changes in the Plan and in the regulations and administrative provisions under
it as in the opinion of counsel for the Corporation may be necessary or
appropriate from time to time.

    

    SECTION 9. STATUS OF
PLAN

    

    Unless
the Administrator shall otherwise expressly determine in writing, with respect
to the portion of any Award that has not been exercised and any payments in
cash, Stock or other consideration not received by a participant, a participant
shall have no rights greater than those of a general creditor of the
Corporation. In its sole discretion, the Administrator may authorize the
creation of trusts or other arrangements to meet the Corporation's obligations
to deliver Stock or make payments with respect to Awards hereunder, provided
that the existence of such trusts or other arrangements is consistent with the
foregoing sentence.

    

    SECTION 10. CHANGE OF
CONTROL AND MERGER PROVISIONS

    

    In
contemplation of and subject to the consummation of a consolidation or merger or
sale of all or substantially all of the assets of the Corporation in which
outstanding shares of Stock are exchanged for securities, cash or other property
of an unrelated corporation or business entity or in the event of a liquidation
or dissolution of the Corporation or in the event of a corporate reorganization
of the Corporation (in each case, a "Transaction"), the Board, or the board of
directors of any corporation or other entity assuming the obligations of the
Corporation, may, in its discretion, take any one or more of the following
actions, as to outstanding Awards: (i) provide that such Awards shall be assumed
or equivalent awards shall be substituted, by the acquiring or succeeding
corporation or other entity (or an affiliate thereof), and/or (ii) upon written
notice to the participants, provide that all Awards will terminate immediately
prior to the consummation of the Transaction. In the event that, pursuant to
clause (ii) above, Awards will terminate immediately prior to the consummation
of the Transaction, all vested Awards shall be fully settled in cash or in kind
at such appropriate consideration as determined by the Administrator in its sole
discretion after taking into account any and all consideration payable per share
of Stock pursuant to the Transaction (the "Transaction Price").

    

    "Change
of Control" shall be defined as an event subsequent to the adoption of this
Plan, by any "person," as such term is used in Sections 13(d) and 14(d) of the
Act (other than the Corporation, any of its Subsidiaries, any "affiliate" or
"associate" (as such terms are defined in Rule 12b-2 under the Act) of the
foregoing persons, or any trustee, fiduciary or other person or entity holding
securities under any employee benefit plan or trust of the Corporation or any of
its Subsidiaries), together with all "affiliates" and "associates" (as such
terms are defined in Rule 12b-2 under the Act) of such person, who shall become
the "beneficial owner" (as such term is defined in Rule 13d-3 under the Act),
directly or indirectly, of securities of the Corporation representing 25% or
more of the combined voting power of the Corporation's then outstanding
securities having the right to vote in an election of the Corporation's Board of
Directors ("Voting Securities") (other than as a result of an acquisition of
securities directly from the Corporation).

     

    Notwithstanding
the foregoing, a "Change of Control" shall not be deemed to have occurred for
purposes of the foregoing clause (i) solely as the result of an acquisition of
securities by the Corporation which, by reducing the number of shares of Voting
Securities outstanding, increases the proportionate number of shares of Voting
Securities beneficially owned by any person (as defined in the foregoing clause
(i)) to 25% or more of the combined voting power of all then outstanding Voting
Securities; PROVIDED, however, that if such person shall thereafter become the
beneficial owner of any additional shares of Voting Securities (other than
pursuant to a stock split, stock dividend, or similar transaction or as a result
of an acquisition of securities directly from the Corporation), then a "Change
of Control" shall be deemed to have occurred for purposes of the foregoing
clause.

    

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

     

    SECTION 11. GENERAL
PROVISIONS

    

    A.
DELIVERY OF STOCK CERTIFICATES.

    

    Stock
certificates to be delivered to participants under this Plan shall be deemed
delivered for all purposes when the Corporation or a stock transfer agent of the
Corporation shall have mailed such certificates in the United States mail,
addressed to the participant, at the participant's last known address on file
with the Corporation.

    

    B.  OTHER
COMPENSATION ARRANGEMENTS; NO EMPLOYMENT RIGHTS.

    

    Nothing
contained in this Plan shall prevent the Board from adopting other or additional
compensation arrangements, including trusts, and such arrangements may be either
generally applicable or applicable only in specific cases. The adoption of this
Plan and the grant of Awards shall not confer upon any employee any right to
continued employment with the Corporation or any Subsidiary and shall not
interfere in any way with the right of the Corporation or any Subsidiary to
terminate the employment of any of its employees at any time.

    

    C.
TRADING POLICY RESTRICTIONS.

    

    Sale of
Stock acquired pursuant to an Award under the Plan shall be subject to such
Corporation’s insider-trading-policy-related restrictions as established by the
Corporation from time, terms and conditions as may be established by the
Administrator from time to time, or in accordance with policies set by the
Administrator, from time to time.

    

    D.
INDEMNIFICATION OF THE COMMITTEE AND THE BOARD OF DIRECTORS.

    

    With
respect to administration of this Plan, the Corporation shall indemnify
each present and future member of the Committee and the Board of Directors
against, and each member of the Committee and the Board of Directors shall be
entitled without further act on his part to indemnity from the Corporation for,
all expenses (including attorney's fees, the amount of judgments and the amount
of approved settlements made with a view to the curtailment of costs of
litigation, other than amounts paid to the Corporation itself) reasonably
incurred by him in connection with or arising out of any action, suit, or
proceeding in which he may be involved by reason of his being or having been a
member of the Committee and/or the Board of Directors, whether or  not
he continues to be a member of the Committee and/or the Board of Directors at
the time of incurring the expenses, including, without limitation, matters as to
which he shall be finally adjudged in any action, suit or proceeding to have
been found to have been negligent in the performance of his duty as a member of
the Committee or the Board of Directors. However, this indemnity shall not
include any expenses incurred by any member of the Committee and/or the Board of
Directors in respect of matters as to which he shall be finally adjudged in any
action, suit or proceeding to have been guilty of gross negligence or willful
misconduct in the performance of his duty as a member of the Committee and the
Board of Directors. In addition, no right of indemnification under this Plan
shall be available to or enforceable by any member of the Committee and the
Board of Directors unless, within 60 days after institution of any action, suit
or proceeding, he shall have offered the Corporation the opportunity to handle
and defend same at its own expense. The failure to notify the Corporation within
60 days shall only affect a Director or committee member's right to
indemnification if said failure to notify results in an impairment of the
Corporation's rights or is detrimental to the Corporation. This right of
indemnification shall inure to the benefit of the heirs, executors or
administrators of each member of the Committee and the Board of Directors and
shall be in addition to all other rights to which a member of the Committee and
the Board of Directors may be entitled as a matter of law, contract, or
otherwise.

     

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    
SECTION 11. GENERAL PROVISIONS -
continued

     

    E.
GENDER.

     

    If the
context requires, words of one gender when used in this Plan shall include the
others and words used in the singular or plural shall include the
other.

     

    F.  HEADINGS.

    

    Headings
of Articles and Sections are included for convenience of reference only and do
not constitute part of the Plan and shall not be used in construing the terms of
the Plan.

    

    G.
OTHER COMPENSATION PLANS.

    

    The
adoption of this Plan shall not affect any other compensation or benefit plans
in effect for the Corporation or any Affiliate, nor shall the Plan preclude the
Corporation from establishing any other forms of compensation, including a stock
option plan, for employees of the Corporation or any Affiliate.

    

    H.
OTHER AWARDS.

    

    The grant
of Stock or Awards shall not confer upon the Eligible Person the right to
receive any future or other Stock or Awards under this Plan, whether or not
Stock or Awards may be granted to similarly situated Eligible Persons, or the
right to receive future Stock or Awards upon the same terms or conditions as
previously granted.

    

    SECTION
12.  EFFECTIVE DATE OF PLAN

    

    The Plan
shall become effective September 1, 2008 on adoption by the board of directors
of the Corporation (the “Board”).

    

    SECTION 13. GOVERNING
LAW

    

    This Plan
and all Awards and actions taken there under shall be governed by, and construed
in accordance with, the laws of the State of Nevada, applied without regard to
conflict of law principles.

     

     

     

    

      9

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