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Unassociated Document

    

      Exhibit
        10.1

      EMPLOYMENT
        AGREEMENT

      

      This
        Employment Agreement dated as of August 10, 2007 (“Agreement”)
        is
        made by and between ECO2
        Plastics, Inc.,
        a
        corporation duly organized and existing under the laws of the State of Delaware
        (the “Company”),
        and
Craig
        D. Hardy
        (“Executive”)
        (referred to collectively herein as the “Parties”).

      

      RECITALS

      

      WHEREAS,
        the
        Company desires to hire Executive and Executive desires to become employed
        by
        the Company; and

      

      WHEREAS,
        the
        Company and Executive have determined that it is in their respective best
        interests to enter into this Agreement on the terms and conditions as set
        forth
        herein;

      

      NOW,
        THEREFORE,
        in
        consideration of the premises and the mutual covenants and promises 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.         Nature
          of Agreement.
          Any and
          all prior oral understandings, offers, and/or representations (if any)
          with
          respect to the employment of Executive are deemed by the Parties to be
          either
          canceled and void and/or are deemed to be superseded by this final written
          Agreement.

      
        	2.	 	
                Employment
                  Terms and Duties.

              

      

       

      

        2.1.        
          Term
          of Employment.
          The
          employment of Executive under this Agreement shall be deemed effective
          on the
          date first written above (the “Effective
          Date”).
          Executive’s employment shall be deemed to have commenced on or before August 27,
          2007 and shall continue until terminated in accordance with Section 5 hereof
          (the “Employment
          Term”).
          This
          Agreement shall be deemed definitive upon the Effective Date.

        

        2.2.        
          Position
          and Primary Responsibility.
          

        

        (a)  The
          Executive shall serve as the Chief Financial Officer of the
          Company.

        

        (b)
            In
          connection with the employment of Executive, Company agrees that, during
          the
          Employment Term, neither the Restated Certificate of Incorporation, nor
          the
          Bylaws, of the Company shall at any time be amended in a manner inconsistent
          with the foregoing or the additional provisions of this Agreement, unless
          otherwise mutually agreed upon by the Parties.

        

        2.3.        
          Exclusivity.
          Executive agrees to devote his full time, attention, energies, solely and
          exclusively in the performance of his duties under the terms of this Agreement.
          However, the expenditure of reasonable amounts of time for educational,
          charitable, or professional activities shall not be deemed a breach of
          this
          Agreement if those activities do not materially interfere with the services
          required under this Agreement, and shall not require the prior written
          consent
          of the Company’s Board of Directors. This Agreement shall not be interpreted to
          prohibit Executive from making passive personal investments or conducting
          private business affairs, or serving on the boards of directors of other
          companies or other entities, if those activities do not materially interfere
          with the services required under this Agreement and do not violate Sections
          4, 8
          and 10 of this Agreement. 

         

        
          
            
            

          

          
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        3.          Compensation.

        

        3.1.        
          Base
          Salary.
          In
          consideration for the services rendered to the Company hereunder by Executive,
          the Company shall, during his employment, pay Executive a salary at the
          annual
          rate of Two Hundred Fifty Thousand Dollars ($250,000.00) (as may be adjusted
          pursuant to this Section 3.1 and/or Section 3.5, the “Base
          Salary”),
          less
          statutory deductions and withholdings, payable to Executive on a bi-monthly
          basis. 

        

        3.2.        
          Payment.
          All
          compensation payable to Executive hereunder shall be subject to all applicable
          state and federal employment law(s); it being understood that Executive
          shall be
          responsible for the payment of all taxes resulting from a determination
          that any
          portion of the compensation and/or benefits paid/received hereunder is
          a taxable
          event to Executive; it being further understood that Executive shall hold
          the
          Company harmless from any governmental claim(s) for Executive’s personal tax
          liabilities, including interest or penalties, arising from any failure
          by
          Executive to pay his individual taxes when due.

        

        3.3.        
Reimbursement
          of Expenses.
          During
          the Employment Term, the Company shall reimburse Executive for all reasonable
          and necessary expenses incurred by Executive while performing his duties
          under
          this Agreement in accordance with the Company’s customary practices for its
          executive employees, subject to provision by Executive of documentation
          reasonably satisfactory to the Board of Directors. 

        

        3.4.        
Cash
          Bonuses.
          Executive shall be eligible for a bonus entitlement during each calendar
          year
          (or portion thereof) of the Employment Term with a target of fifty percent
          (50%)
          of his Base Salary for such year (or portion thereof) (the “Bonus”).
          The
          Bonus shall be guaranteed at a minimum amount of Twenty-Five Thousand Dollars
          ($25,000) for the first year of employment. Within sixty (60) days of the
          Effective Date, the Company and Executive shall concur, within their respective
          reasonable discretion, on the criteria and procedures applicable to
          establishment of Executive’s entitlement to such amount for the then current
          calendar year; and, thereafter, within thirty (30) days prior to the
          commencement of each calendar year of the Employment Term, the Company
          and
          Executive shall concur, within their respective reasonable discretion,
          on the
          criteria and procedures applicable to establishment of Executive’s entitlement
          to such amount for the ensuing calendar year. Such criteria shall include,
          without limitation: (i) specified revenue targets for the Company during
          the
          applicable period; (ii) specified EBITDA targets for the Company during
          the
          applicable period (as defined pursuant to consensus between the Company
          and
          Executive); and (iii) such additional specified targets as the Company
          and
          Executive mutually determine. Any such cash bonuses shall be paid by the
          Company
          no later than March 15th
          of the
          taxable year commencing after the year in which the Executive’s right to such
          payment becomes vested.

        

        
          
            
            

          

          
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        3.5.         
Compensation
          Review.
          It is
          understood and agreed that Executive’s performance will be reviewed by the
          Company’s Board of Directors at the end of each calendar year during which this
          Agreement is in force for the purpose of determining whether or not Executive’s
          Base Salary and/or cash bonuses should be increased; it being further understood
          that the decision to increase Executive’s compensation shall be at the sole and
          exclusive option of the Compensation Committee with the Board of Directors
          approval.

        

        3.6.         
Equity
          Awards.
          

         

        
          
            (a)  The
              Executive shall be entitled to a combination of (x) restricted grants
              of common
              stock, $0.001 par value (“Common
              Stock”),
              of
              the Company and (y) a common stock purchase warrant to acquire Common
              Stock of
              the Company, a form of warrant is attached hereto as Exhibit
              B,
              exercisable over a period of four (4) years after grant with respect
              to shares
              of Common Stock, in the aggregate covering five million (5,000,000)
              shares
              (collectively, the “Executive
              Shares”).

          

        

        

        (b)  The
          market price of the stock at close of market on the day preceding the Effective
          Date will determine the fair market value per share (the “Market
          Value”)
          of
          Common Stock issuable to Executive under this Section 3.6, at the respective
          dates of issuance of the Executive Shares (as those terms are defined below).
          As
          soon as practicable, but in any event within thirty (30) days of the date
          of
          this Agreement, the Company shall issue and deliver to Executive the following
          equity awards based upon the following vesting schedule:

        

        (i)
          one
          million two hundred fifty thousand (1,250,000) shares of Common Stock shall
          vest
          immediately upon issuance; 

        (ii)
          one
          million two hundred fifty thousand (1,250,000) shares of Common Stock shall
          vest
          on the first anniversary of Effective Date; 

        (iii)
          one
          million two hundred fifty thousand (1,250,000) shares shall vest on the
          second
          anniversary of the Effective Date; and 

        (iv)
          one
          million two hundred fifty thousand (1,250,000) shares shall vest on the
          third
          anniversary of the Effective Date.

        

        (c)  The
          Company shall cooperate with Executive in the making by Executive of a
          timely
          election under Section 83(b) of the Internal Revenue Code of 1986 with
          respect
          to any restricted share grant of Common Stock. Executive shall submit a
          copy to
          the Company of any such election if made.

         

        
          
            
            

          

          
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        (d)  In
          the
          event that the Company, at its expense, registers with the Securities and
          Exchange Commission pursuant to one or more effective registration statements
          under the Securities Act of 1933, as amended (the “Securities
          Act”),
          (the
“Registration
          Statement”)
          in the
          manner prescribed by Executive, the Company shall include the Executive
          Shares
          (the “Registrable
          Securities”)
          in the
          Registration Statement, and shall maintain the effectiveness and currency
          of
          each such Registration Statement, including any related prospectus until
          the
          resale of such shares by Executive or any successor thereof; and shall
          take all
          such further action (including, without limitation, any registration of
          such
          shares under applicable state securities laws and the listing of such shares
          on
          any and all trading markets or stock exchanges as the Company’s common shares
          may trade from time to time) as shall permit the resale of such shares,
          or any
          portion thereof, as aforesaid. The Company shall from time to time furnish
          to
          Executive sufficient copies of any such prospectus, and any supplements
          thereto,
          so as to permit the resale of such shares, or any portion thereof, in the
          manner
          prescribed by Executive. In addition, prior to the grant of the Executive
          Shares, the Company shall enter into an additional agreement with Executive
          extending to Executive incidental registration rights covering the resale
          of the
          Registrable Securities on terms no less favorable to Executive than have
          then
          been extended to any other stockholder of the Company. The Company shall
          pay the
          costs and expenses incurred by Executive in connection with any such
          registration, including the reasonable legal fees and expenses that Executive
          may incur in connection therewith. The obligations of the Company pursuant
          to
          this Section 3.6(f) are referred to herein as the “Registration
          Obligations.”
The
          amount of Common Stock included in a Registration Statement filed is, however,
          subject to the right of the Company and its underwriters to reduce the
          number of
          shares proposed to be registered pro-rata in view of market conditions
          or legal
          considerations, pursuant to Rule 415 of the Securities Act, which may limit
          the
          total number of shares included on a Registration Statement to thirty percent
          (30%) of the then issued and outstanding common stock of the Company. In
          the
          event the total number of shares registered is required to be adjusted
          to comply
          with Rule 415 of the Securities Act, the Executive agrees to the allocation
          of
          such adjustment on a pro-rata basis.

         

        
          (e)
              On
            or
            prior to the first anniversary following the Effective Date, the Company
            and
            Executive shall have concurred, in their respective reasonable discretion,
            on
            the terms and conditions of a long-term equity incentive award program
            pursuant
            to which Executive and the other members of executive management of the
            Company
            shall be entitled to grants of shares of Common Stock based upon achievement
            of
            specified performance objectives.

        

        

        (f)
            Any
          restricted stock granted shall be granted and issued pursuant to a Restricted
          Stock Agreement, a form of which is attached hereto as Exhibit
          A.

        

        3.7         
          Relocation
          Expenses. In
          connection with the employment of Executive, the Company shall provide
          relocation expenses in the amount of Thirty-Five Thousand Dollars ($35,000)
          (the
“Relocation
          Expenses”)
          in
          connection with Executive’s move to a new permanent residence. The Relocation
          Expenses shall be paid to Executive at the relocation occurs. Executive
          shall
          only receive Relocation Expenses upon completion of Executive’s relocation to a
          new permanent residence.

         

        (a)  Executive
          may, at his discretion, elect to convert, via written notice to the Company
          within thirty (30) days of the Effective Date, the full amount of the Relocation
          Expenses into shares of common stock in an amount equivalent to Seventy
          Thousand
          Dollars ($70,000) in value as determined by the closing price of the stock
          on
          the date of election. 

        

        (b)  In
          the
          event that Executive is terminated pursuant to Section 5 prior to the first
          anniversary of the Effective Date, the Relocation Expenses or the conversion
          of
          the Relocation Expenses shall be subject to forfeiture.

         

        
          
            
            

          

          
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        (c)  Executive
          shall be responsible for providing documentation of all expenses associated
          with
          the relocation and the Company shall gross up compensation for the Relocation
          Expenses to account for taxes paid on any additional income. Compensation
          for
          taxes shall be made in accordance with the manner Executive elects to receive
          payment for the Relocation Expenses of either cash or shares.

        

        3.8         
          Travel
          Expenses. In
          connection with the employment of Executive, the Company shall reimburse
          hotel
          expenses in an amount not to exceed Two Thousand Dollars ($2,000) (the
          “Travel
          Expenses”)
          per
          month for Executive’s costs of hotel rooms while traveling from Modesto, CA to
          the Company’s offices in San Francisco, CA during the first four (4) months of
          the Employment Term. Executive must provide receipts for reimbursement
          of travel
          expenses.

        

        4.          Benefits.
          Within
          thirty (30) days of the date of this Agreement, the Company and Executive
          shall
          determine, in their respective reasonable discretion, the terms of the
          “Welfare
          Benefits”
(as
          hereinafter defined) to which Executive shall be entitled. For purposes
          hereof,
“Welfare
          Benefits”
shall
          mean medical, prescription and dental plans, in no event less favorable
          than
          those applicable to any other executive of the Company, and in all events
          extending to (x) paid vacation per annum equal to three (3) weeks (accruing
          ratably each year) and eleven (11) paid holidays and (y) a non-accountable
          monthly allowance of Five Hundred Dollars ($500) (the “Monthly
          Allowance”).

        

        5.          Termination.
          Executive’s employment and this Agreement (except as otherwise provided
          hereunder) shall terminate upon the occurrence of any of the following,
          at the
          time set forth therefor (the “Termination
          Date”):

        

        5.1.         
          Death
          or Disability.
          Immediately upon the death of Executive or after six (6) months of Executive’s
          inability to perform the essential functions of his duties, with or without
          reasonable accommodation (defined under applicable law), due to a mental
          or
          physical illness or incapacity (“Disability”)
          (termination pursuant to this Section 5.1 being referred to herein as
          termination for “Death
          or Disability”).
          Upon
          the Death of Executive, Executive’s heirs or assigns shall be entitled to (i)
          fifty percent (50%) of the annual Base Salary and (ii) on pro-rated amount
          of
          any and all outstanding Executive Shares that Executive is entitled to
          receive
          from the Effective Date to the date of Death (the “Earnings
          Entitlement”).
          In
          the event Executive commits suicide, Executive’s heirs or assigns shall not be
          entitled to the Earnings Entitlement.

        

        5.2.         
          Termination
          for Good Reason.
          Immediately following notice of termination for “Good
          Reason”
(as
          defined below), specifying such Good Reason, given by Executive (termination
          pursuant to this Section 5.2 being referred to as termination for “Good
          Reason”).
          As
          used herein, “Good Reason” means (i) any reduction in Base Salary or other
          benefits specified hereunder; (ii) a substantial diminution or dilution
          of the
          responsibilities, functions and duties attached to the position with the
          Company
          held by Executive; (iii) the Company fails to provide any of the compensation
          or
          other benefits required hereunder; (iv) any representation made by the
          Company
          herein is materially untrue or the Company otherwise is in material breach
          of
          this Agreement; or (v) the Company and Executive fail to effectuate the
          matters
          contemplated by Sections 3.4, 3.6 or 4 within the respective periods
          contemplated thereunder. 

         

        
          
            
            

          

          
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        5.3.         
          Voluntary
          Termination.
          Thirty
          (30) days following Executive’s written notice to the Company of voluntary
          termination of employment other than for Good Reason; provided, however,
          that
          the Company may suspend, with no reduction in pay or benefits (including,
          without limitation, bonuses, options and vesting), Executive from his duties
          as
          set forth herein (including, without limitation, Executive’s position as a
          representative and agent of the Company) until the 30th
          day
          following Notice of Voluntary termination) (termination pursuant to this
          Section
          5.3 being referred to herein as “Voluntary”
          termination).

        

        5.4.         
          Termination
          For Cause.
          Immediately following notice of termination for “Cause”
(as
          defined below), specifying such Cause, given by the Company (termination
          pursuant to this Section 5.4 being referred to herein as termination for
          “Cause”).
          As
          used herein, “Cause”
means
          (i) termination based on Executive’s conviction or plea of “guilty” or “no
          contest” to any crime constituting a felony in the jurisdiction in which the
          crime constituting a felony is committed, or any other conviction by a
          court of
          competent jurisdiction for a violation of criminal law involving dishonesty
          that
          materially injures the Company (whether or not a felony); (ii) Executive’s
          substance abuse that in any manner that materially interferes with the
          performance of his duties; (iii) Executive’s failure to perform in any material
          respect the responsibilities, functions and duties attached to his position
          with
          the Company or a refusal to perform his duties at all or in a reasonably
          acceptable manner; and (iv) Executive’s material breach of this Agreement. The
          Board of Directors shall provide Executive thirty (30) days written notice
          of
          any determination to terminate Executive for Cause and shall afforded Executive
          the opportunity to be heard by the full Board of Directors. Notwithstanding
          any
          other provision in this Agreement, if Executive is terminated pursuant
          to
          subsections (ii), (iii) or (iv) of this Section 5.4 for poor job performance,
          excluding refusal to perform his duties, Executive shall have sixty (60)
          days to
          cure the behavior upon which the threatened termination is based and during
          which time Executive shall have no reduction in pay or benefits (including
          without limitation, bonuses, options and vesting).

        

        5.5.         
          Termination
          Without Cause.
          Notwithstanding any other provisions contained herein, the Company may
          terminate
          Executive’s employment thirty (30) days following notice of termination without
          Cause given by the Company; provided, however, that during any such thirty
          (30)
          day notice period, the Company may suspend, with no reduction in pay or
          benefits
          (including, without limitation, bonuses, options and vesting), Executive
          from
          his duties as set forth herein (including, without limitation, Executive’s
          position as a representative and agent of the Company) (termination pursuant to
          this Section 5.5 being referred to herein as termination “Without
          Cause”).

        

        5.6.         
          Other
          Remedies.
          Termination pursuant to Section 5.2 above shall be in addition to and without
          prejudice to any other right or remedy to which Executive may be entitled
          at
          law, in equity, or under this Agreement. Termination pursuant to Section
          5.4
          above shall be in addition to and without prejudice to any other right
          or remedy
          to which the Company may be entitled at law, in equity, or under this
          Agreement.

         

        
          
            
            

          

          
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        5.7.         
          Salary
          Continuation During Disability.
          Notwithstanding Section 5.1 above, if Executive suffers any physical or
          mental
          disability that would prevent the performance of his essential job duties,
          the
          Company agrees to pay Executive one hundred percent (100%) of Executive’s salary
          and other benefits (including, without limitation, bonuses, options and
          vesting), payable in the same manner as provided for the payment of salary
          and
          benefits (including, without limitation, bonuses, options and vesting)
          herein,
          for the duration of the disability, or six (6) months, whichever is less.
          

        
          
             

            6.          Severance
              and Termination.

          

        

        

        6.1.        
          Voluntary
          Termination,
          Termination
          for Cause, Termination for Death or Disability.
          In the
          case of a termination of Executive’s employment hereunder for Death in
          accordance with Section 5.1 above, or Executive’s Voluntary termination of
          employment hereunder in accordance with Section 5.3 above, or a termination
          of
          Executive’s employment hereunder for Cause in accordance with Section 5.4 above,
          (i) Executive shall not be entitled to receive payment of, and the Company
          shall
          have no obligation to pay, any severance or similar compensation attributable
          to
          such termination, other than the Earnings Entitlement earned but unpaid,
          accrued
          but unused vacation to the extent required by the Company’s policies and any
          non-reimbursed expenses pursuant to Section 4 hereof incurred by Executive
          as of
          the termination date, and (ii) the Company’s obligations under this Agreement
          shall immediately cease except (x) as required by law and (y) as provided
          in
          Section 15.1 below. Provided further, in the event of a termination of
          Executive’s employment hereunder for Cause in accordance with Section 5.4 above,
          Executive shall tender back to the Company all unexercised options granted
          to
          Executive by the Company in connection with Executive’s employment.

        

        6.2.        
          Termination
          for Good Reason, Termination Without Cause.
          

        

        (a)  In
          the
          case of a termination of Executive’s employment hereunder for Good Reason in
          accordance with Section 5.2 above, or Without Cause in accordance with
          Section
          5.4 above, the Company shall, within thirty (30) days of the Termination
          Date,
          pay Executive, in a lump-sum, cash in the amount (the “Severance
          Payment”)
          of the
          sum of fifty percent (50%) of his annual Base Salary; provided, however,
          that,
          in the event such termination of Executive’s employment follows a
“Change-of-Control” (as defined below), the Severance Payment shall be an amount
          equal to the sum of one hundred percent (100%) of his annual Base Salary.
          As
          used herein, “Change-of-Control”
          means:

        

        (i)  the
          acquisition by any individual, entity or group (within the meaning of Section
          13(d)(3) or 14(d)(2) under the Exchange Act) of beneficial ownership (within
          the
          meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty percent
          (20%) or more of the combined voting power of the outstanding voting securities
          of the Company entitled to vote generally in the election of directors;
          provided, however, that the following acquisitions shall not constitute
          a
          Change-of-Control: (w) any original issuance by the Company, (x) any acquisition
          by the Company after which the holders of the Company’s voting securities
          entitled to vote generally in the election of directors of the Company
          (the
“Voting
          Stock”)
          outstanding immediately prior to consummation of such acquisition continue
          to
          hold at least fifty percent (50%) of the Company’s Voting Stock after such
          acquisition, (y) any acquisition by any employee benefit plan (or related
          trust)
          sponsored or maintained by the Company, or (z) any acquisition by any
          corporation pursuant to a transaction which complies with clauses (w),
          (x) and
          (y) immediately preceding; or

         

        
          
            
            

          

          
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        (ii)  individuals
          who, as of the date hereof, constitute the Board of Directors of the Company
          (the “Incumbent
          Board”)
          cease
          for any reason to constitute at least a majority of the Board of Directors
          of
          the Company unless they are replaced with a slate nominated by at least
          a
          majority of the Incumbent Board and further provided that any individual
          becoming a director subsequent to the date hereof whose election, or nomination
          for election by the Company's stockholders, was approved by a vote of at
          least a
          majority of the directors then comprising the Incumbent Board shall, for
          purposes of this sub-paragraph (ii), be considered as though such individual
          were a member of the Incumbent Board, but excluding, for this purpose,
          any such
          individual whose initial assumption of office occurs as a result of an
          actual or
          threatened election contest with respect to the election or removal of
          directors
          or other actual or threatened solicitation of proxies or consents by or
          on
          behalf of an individual, entity or group other than the Board of Directors
          of
          the Company acting by at least a majority thereof; or

        

        (iii)  consummation
          of a reorganization, merger or consolidation or sale or disposition of
          all or
          substantially all of the assets of the Company (a “Business
          Combination”),
          in
          each case, unless, following such transaction: (x) all or substantially
          all of
          the individuals and entities who were the beneficial owners, respectively,
          of
          the outstanding voting securities of the Company entitled to vote generally
          in
          the election of directors immediately prior to such Business Combination
          beneficially own, directly or indirectly, more than fifty percent (50%)
          (20% in
          the case of any Business Combination being proposed and implemented by
          at least
          a majority of the Incumbent Board) of the Voting Stock of the corporation
          resulting from such Business Combination (including, without limitation,
          a
          corporation which as a result of such transaction owns the Company or all
          or
          substantially all of the Company's assets either directly or through one
          or more
          subsidiaries) in substantially the same proportions as their ownership,
          immediately prior to such Business Combination, of the outstanding Voting
          Stock,
          (y) no individual, entity or group beneficially owns, directly or indirectly,
          twenty percent (20%) or more of the Voting Stock of such corporation except
          to
          the extent that such ownership existed prior to the Business Combination,
          and
          (z) at least a majority of the members of the board of directors of the
          corporation resulting from such Business Combination were members of the
          Incumbent Board, or were nominated by at least a majority of the members
          of the
          Incumbent Board, at the time of the execution of the initial agreement,
          or by
          the action of the Board providing for such Business Combination; or

        

        (iv)  approval
          by the stockholders of the Company of a complete liquidation or dissolution
          of
          the Company.

        

        (b)  In
          addition, in the event Paragraph (a) immediately preceding applies, for
          six (6)
          months after the Termination Date (or such longer period as may be provided
          by
          the terms of the appropriate plan, program, practice or policy), the Company
          shall continue the Welfare Benefits to Executive and/or his family at least
          equal to those which would have been provided if Executive’s employment had not
          been terminated (provided, however, that such period shall be eighteen
          months in
          the event such Paragraph (a) applies following a
          Change-of-Control).

         

        
          
            
            

          

          
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        Notwithstanding
          the foregoing, in the event Executive is a “specified employee” as defined in
          Section 409A(a)(2)(B)(i) of the Code, the payment of the Severance Payment
          under
          this Section 6.2 shall be made no earlier than six (6) months after the
          Termination Date.

        

        7.          Severance
          Conditioned on Mutual Release of Claims.
          The
          Company’s obligation to provide Executive with the Severance Payments set forth
          in Section 6.2 is contingent upon Executive’s execution of a release of mutual
          claims. Any release of claims shall not include any independently verifiable
          criminal acts or civil fraud committed by either the Company and/or its
          officers
          or directors.

        

        8.          Non-competition,
          Non-solicitation.
           

        

        8.1.        
          Non-Competition.
          Executive agrees that he shall not, during the Employment Term and for
          twelve
          (12) months subsequent thereto, without both the disclosure to and the
          written
          approval of the Board of Directors of the Company, directly or indirectly,
          engage or be interested in (whether as a principal, lender, employee, officer,
          director, partner, venturer, consultant or otherwise) any business(es)
          that is
          competitive with the business being conducted by the Company through the
          Termination Date, without the express written approval of the Board of
          Directors.

        

        8.2.        
          Non-Solicitation.
          Executive agrees that he will not, without the prior written consent of
          the
          Company’s Board of Directors, for a period of twelve (12) months after the
          Termination Date, directly or indirectly disturb, entice, or in any other
          manner
          persuade, any employee(s) or consultant(s) of the Company to discontinue
          that
          person’s or firm’s relationship with the Company if the employee(s) and/or
          consultant(s) were employed by the Company at any time during the twelve
          (12)
          month period prior to the Termination Date.

        

        8.3.        
          Customers.
          Executive agrees that he will not, for a period of twelve (12) months following
          the Termination Date, contact or solicit orders, sales or business from
          any
          customer of the Company so as to induce or attempt to induce such customer
          to
          cease doing business with the Company.

        

        8.4.        
          Public
          Investments.
          The
          provisions of Section 8.1 through 8.3, inclusive, shall not be deemed breached
          by reason of Executive’s ownership of five percent (5%) or less of the equities
          of any entity with a class of publicly traded securities.

         

        
          
            
            

          

          
            9

            
              

            

          

          
            
            

          

        

         

        9.          Inventions,
          Discoveries and Improvements.
          Any and
          all invention(s), discovery(ies) and improvement(s), whether protectible
          or
          unprotectible by patent, trademark, copyright or trade secret, made, devised,
          or
          discovered by Executive, whether by Executive alone or jointly with others,
          from
          the time of entering the Company’s employ until the earlier of the Termination
          Date of this Agreement or the actual date of termination of employment,
          relating
          or pertaining in any way to Executive’s employment with the Company, shall be
          promptly disclosed in writing to the Board of Directors of the Company,
          and
          become and remain the sole and exclusive property of the Company. Executive
          agrees to execute any assignments to the Company, or its nominee, of Executive’s
          entire right, title, and interest in and to any such inventions, discoveries
          and
          improvements and to execute any other instruments and documents requisite
          or
          desirable in applying for and obtaining patents, trademarks or copyrights
          at the
          cost of the Company, with respect thereto in the United States and in all
          foreign countries, that may be requested by the Company. Executive further
          agrees, whether or not then in the employment of the Company, to cooperate
          to
          the fullest extent and in the manner that may be reasonably requested by
          the
          Company in the prosecution and/or defense of any suit(s) involving claim(s)
          of
          infringement and/or misappropriation of proprietary rights relevant to
          patent(s), trademark(s), copyright(s), trade secret(s), processes, and/or
          discoveries involving the Company’s product(s); it being understood that all
          reasonable costs and expenses thereof shall be paid by the Company. The
          Company
          shall have the sole right to determine the treatment of disclosures received
          from Executive, including the right to keep the same as a trade secret,
          to use
          and disclose the same without a prior patent application, to file and prosecute
          United States and foreign patent application(s) thereon, or to follow any
          other
          procedure which the Company may deem appropriate. In accordance with this
          provision, Executive understands and is hereby further notified that this
          Agreement does not apply to an invention which the employee developed entirely
          on his own time without using the Company’s equipment, supplies, facilities, or
          trade secret information.

        

        

          
            	10.	 	
                    Confidential
                      Information and Trade Secrets.

                  

          

        

        

        10.1.        Non-Disclosure.
          Executive hereby acknowledges that all confidential or proprietary trade,
          engineering, production, and technical data, information or “know-how”
including, but not limited to, customer lists, sales and marketing techniques,
          vendor names, purchasing information, processes, methods, investigations,
          ideas,
          equipment, tools, programs, costs, product profitability, plans, specifications,
          patent application(s), drawings, blueprints, sketches, layouts, formulas,
          inventions, processes and data, whether or not reduced to writing, used
          in the
          development and manufacture of the Company’s products and/or the performance of
          services, or in research or development, are the exclusive property of
          the
          Company, and shall be at all times, whether after the Effective Date or
          after
          the Termination Date, be kept strictly confidential and secret by Executive;
          it
          being understood, however, that information which was publicly known, or
          which
          is in the public domain, or which is generally known, shall not be subject
          to
          this restriction (and Executive’s duties of non-disclosure shall further not
          extend to (i) disclosures to other employees, executives, officers and/or
          directors of the Company, or as may be required or appropriate in connection
          with performance hereunder, and (ii) the requirements of legal process,
          subpoena
          or other court order). 

        

        10.2.        Return
          of Property.
          Executive agrees not to remove from the Company’s office or copy any of the
          Company’s confidential information, trade secrets, books, records, documents or
          customer or supplier lists, or any copies of such documents, without the
          express
          written permission of the Board of Directors of the Company or as may be
          required or appropriate in connection with performance hereunder. Executive
          agrees, at the Termination Date, to return any property belonging to the
          Company, including, but not limited to, any and all records, notes, drawings,
          specifications, programs, data and other materials (or copies thereof)
          pertaining to the Company’s businesses or its product(s) and service(s),
          generated or received by Executive during the course of his employment
          with the
          Company.

         

        
          
            
            

          

          
            10

            
              

            

          

          
            
            

          

        

         

        11.         Information
          of Others.
          Executive agrees that the Company does not desire to acquire from Executive
          any
          secret or confidential information or “know-how” of others. Executive,
          therefore, specifically represents to the Company that he will not bring
          to the
          Company any materials, documents, or writings containing any such information.
          Executive represents and warrants that from the Effective Date of this
          Agreement
          he is free to divulge to the Company, without any obligation to, or violation
          of, the rights of others, information, practices and/or techniques which
          Executive will describe, demonstrate or divulge or in any other manner
          make
          known to the Company during Executive’s performance of services. Executive also
          agrees to indemnify and hold the Company harmless from and against any
          and all
          liabilities, losses, costs, expenses, damages, claims or demands for any
          violation of the rights of others as it relates to Executive’s misappropriation
          of secrets, confidential information, or “know-how” of others. Such
          indemnification will not apply in the event action by the Company is
          unsuccessful.

        

        12.        Indemnification.
          The
          Company shall indemnify Executive in his capacity as director, officer
          and
          employee of the Company upon terms no less favorable to him than are contained
          under Article 7 of the Restated Certificate of Incorporation of the Company,
          and
          Article VI of the Bylaws of the Company, as in effect on the date hereof.
          The
          Company shall extend to Executive the benefits of directors’ and officers’
liability insurance upon terms no less favorable than are extended to any
          other
          director or officer of the Company. Upon execution, the Company and Executive
          shall enter into an Indemnification Agreement in form and substance acceptable
          to Executive providing for the indemnification contemplated hereby.

        

        13.        
          Notice.
          All
          notices and other communications under this Agreement shall be in writing
          and
          shall be delivered personally or mailed by registered or certified mail,
          return
          receipt requested, and shall be deemed given when so delivered or mailed,
          to a
          party at his or its address as follows (or at such other address as a party
          may
          designate by notice given hereunder):

         

        
          
            	
                    If
                      to Executive:

                  	
                    Craig
                      D. Hardy

                  
	 	
                    1813
                      Savoie Way

                  
	 	
                    Modesto,
                      CA 95356

                  
	 	 
	
                    With
                      a copy to:

                  	
                    _______________________

                  
	 	
                    _______________________

                  
	 	
                    _______________________

                  
	 	
                    _______________________

                  
	 	 
	
                    If
                      to the Company:

                  	
                    ECO2
                      Plastics, Inc.

                  
	 	
                    680
                      Second Street, Suite 200

                  
	 	
                    San
                      Francisco, CA 94107

                  
	 	 
	
                    With
                      a copy to:

                  	
                    David
                      M. Otto

                  
	 	
                    The
                      Otto Law Group, PLLC

                  
	 	
                    601
                      Union St., Suite 4500

                  
	 	
                    Seattle,
                      WA 98101

                  

          

        

         

        
          
            
            

          

          
            11

            
              

            

          

          
            
            

          

        

         

        14.         
          Suit,
          Jurisdiction.
          Any
          controversy between the Company and Executive arising out of or relating
          to any
          of the terms, provisions or conditions of this Agreement shall be submitted
          to
          arbitration in accordance with the American Arbitration Association’s National
          Arbitration Rules for the Resolution of Employment Disputes. On the written
          request of either party for arbitration of such a claim pursuant to this
          paragraph, the Company and Executive shall both be deemed to have waived
          the
          right to litigate the claim in any federal or state court. To the extent
          that
          any claim or controversy arising out of this Agreement cannot be submitted
          to
          arbitration as set forth above, each party hereby agrees that any suit,
          action
          or proceeding with respect to this Agreement, and any transactions relating
          hereto, may be brought in the State of California, County of San Francisco,
          and
          each of the parties hereby irrevocably consents and submits to the jurisdiction
          of such Court(s) for the purpose of any such suit, action or proceeding.
          Each of
          the parties hereby waives and agrees not to assert, by way of motion, as
          a
          defense or otherwise, in any such suit, action or proceeding; any claim
          that it
          (he) is not personally subject to the jurisdiction of the above-named Court(s);
          and, to the extent permitted by applicable law, any claim that such suit,
          action
          or proceeding is brought in an inconvenient forum or that the venue of
          such
          suit, action or proceeding is improper or that this Agreement or any
          replacements hereof or thereof may not be enforced in or by such Court(s).
          The
          Company shall pay any and all costs associated with arbitration or court
          adjudication.

        

        15.         
          Miscellaneous.

        

        15.1.        Post
          Termination Obligations.
          Notwithstanding the termination of Executive’s employment hereunder, the
          provision(s) of Section(s) “3.6(e),” “5,” “6,” “7,” “9,” “10,” “12” and “14”
shall survive the Termination Date.

        

        15.2.        Assignment.
          This
          Agreement shall be assigned to and inure to the benefit of, and be binding
          upon,
          any successor to substantially all of the assets and business of the Company
          as
          a going concern, whether by merger, consolidation, liquidation or sale
          of
          substantially all of the assets of the Company or otherwise. The Company
          will
          require any successor (whether direct or indirect, by purchase, merger,
          consolidation or otherwise) to all or substantially all of the business
          and/or
          assets of the Company to assume expressly and agree to perform this Agreement
          in
          the same manner and to the same extent that the Company would be required
          to
          perform it if no such succession had taken place; and, as used in this
          Agreement, “Company”
shall
          mean the Company as hereinbefore defined and any successor to its business
          and/or assets as aforesaid which assumes and agrees to perform this Agreement
          by
          operation of law, or otherwise; provided that for purposes of Section 8
          hereof,
          the term “Company” shall mean the Company as hereinbefore defined and any such
          transaction in which this Agreement is assigned to a successor may not
          expand or
          enlarge the scope of restrictions applicable to Executive pursuant to Section
          9
          hereof. Executive understands and agrees, however, that this Agreement
          is
          exclusive and personal to him only, and, as such, he will neither assign
          nor
          subcontract all or part of his undertaking(s) or obligation(s) under the
          terms
          of this Agreement.

         

        
          
            
            

          

          
            12

            
              

            

          

          
            
            

          

        

         

        15.3.        Severability.
          In the
          event that any provision of this Agreement shall be determined to be
          unenforceable or otherwise invalid, the balance of the provision(s) shall
          be
          deemed to be enforceable and valid; it being understood that all provision(s)
          of
          this Agreement are deemed to be severable, so that unenforceability or
          invalidity of any single provision will not affect the remaining
          provision(s).

        

        15.4.        Headings.
          The
          Section(s) and paragraph heading(s) in this Agreement are deemed to be
          for
          convenience only, and shall not be deemed to alter or affect any provision
          herein.

        

        15.5.        Interpretation
          of Agreement.
          This
          Agreement shall be interpreted in accordance plain meaning of its terms
          and
          under the laws of the State of California. Each party has cooperated in
          the
          drafting of this Agreement. Therefore, in the construction of this Agreement,
          the Agreement shall not be interpreted for or against any party by virtue
          of
          having drafted the Agreement and any such principle of interpretation shall
          be
          construed in a neutral manner.

        

        15.6.        Variation.
          Subject
          to Section 15.8, any changes in the Sections relating to salary, bonus,
          or other
          material condition(s) after the Effective Date of this Agreement shall
          not be
          deemed to constitute a new Agreement. All unchanged terms are to remain
          in force
          and effect.

        

        15.7.        Collateral
          Documents.
          Each
          party hereto shall make, execute and deliver such other instrument(s) or
          document(s) as may be reasonably required in order to effectuate the purposes
          of
          this Agreement.

        

        15.8.        Non-Impairment.
          This
          Agreement may not be amended or supplemented at any time unless reduced
          to a
          writing executed by each party hereto. No amendment, supplement or termination
          of this Agreement shall affect or impair any of the rights or obligations
          which
          may have matured thereunder.

        

        15.9.        Execution.
          This
          Agreement may be executed in one or more counterpart(s), and each executed
          counterpart(s) shall be considered by the Parties as an original.

        

        15.10.      Legal
          Counsel.
          Executive represents to the Company that he has retained legal counsel
          of his
          own choosing, and was given sufficient opportunity to obtain legal counsel
          prior
          to executing this Agreement. Executive also represents that he has read
          each
          provision of this Agreement and understands its meaning.

        

        15.11.      Transition.
          In the
          event that Executive’s employment with the Company terminates, Executive shall,
          through the last day of employment, and at the Company’s request, use
          Executive’s reasonable efforts (at the Company’s expense) to assist the Company
          in transitioning Executive’s duties and responsibility responsibilities to
          Executive’s successor and maintaining the Company’s professional relationship
          with all customers, suppliers, etc. Without limiting the generality of
          the
          foregoing, Executive shall cooperate and assist the Company, at the Company’s
          direction and instruction, during the transition period between any receipt
          of
          or giving of notice of the termination of employment and the final day
          of
          employment. 

         

        
          
            
            

          

          
            13

            
              

            

          

          
            
            

          

        

         

        15.12.      Section
          409A Matters.
          It is
          the intention of the Parties that no payment or entitlement pursuant to
          this
          Agreement will give rise to any adverse tax consequences to the Executive
          under
          26 U.S.C. Sec. 409A (“409A”).
          The
          Agreement shall be interpreted to that end and, consistent with that objective
          and notwithstanding any provision herein to the contrary, the Company shall
          indemnify Executive from any adverse tax consequences, penalties and/or
          interest
          thereon that may arise under 409A, and the Company may unilaterally take
          any
          action it deems necessary or desirable to amend any provision herein to
          avoid
          the application of 409A if such action will only benefit the Executive.
          Should
          either party determine that there is a reasonable possibility that the
          text of
          this Agreement could give rise to such adverse tax consequences, the Parties
          agree to negotiate in good faith to amend the Agreement to obviate the
          possibility of such consequences.

         

        If,
          at
          any time, the Company (or its direct or indirect parent) has a class of
          stock
          that is publicly traded on an established securities market or otherwise,
          the
          Company shall from time to time compile a list of “Specified Employees” as
          defined in, and pursuant to, Prop. Reg. Sec. 1.409A-1(i) or any successor
          regulation. Notwithstanding any other provision herein, if the Executive
          is a
          Specified Employee on the date of his termination of employment, no payment
          of
          compensation under this Agreement shall be made to the Executive during
          the
          period lasting six months from the date of his termination of employment
          unless
          the Executive determines that there is no reasonable basis for believing
          that
          making such payment would cause the Executive to suffer any adverse tax
          consequences pursuant to 409A. If any payment to the Executive is delayed
          pursuant to the provisions of this paragraph, such payment instead shall
          be made
          on the first business day following the expiration of the six (6) month
          period
          referred to in the prior sentence.

        

        [Signature
          page to follow]

        

          
            
              
              

            

            
              14

              
                

              

            

            
              
              

            

          

        IN
          WITNESS WHEREOF, the Parties hereto have set their hands and seals the
          day and
          year first above written.

         

        
          	
                  THE
                    COMPANY:

                	 	 	 
	 	 	 	 
	
                  ECO2
                    PLASTICS, INC.

                	 	 	 
	 	 	 	 
	By: 	 	 	 
	
                  
                    

                  

                  Rodney
                    S. Rougelot

                	 	 	
                
	
                  Its:           Chief
                    Executive Officer

                  Date:       August
                    10, 2007

                	 	 	 
	 	 	 	 
	
                  EXECUTIVE:

                	 	 	 
	 	 	 	 
	
                  
                    CRAIG
                      D. HARDY

                  

                	 	 	 
	 	 	 	 
	
                  
                    

                  

                  
                    Craig
                      D. Hardy

                  

                	 	 	 
	
                  Date:
                    August 10, 2007 

                	 	 	 

        

         

        
          
            
            

          

          
            15

            
              

            

          

          
            
            

          

        

      

    

     

    Exhibit
      A

    Restricted
      Stock Agreement

    

    This
      Restricted Stock Agreement dated as of August 10, 2007 (“Agreement”)
      is
      made by and between ECO2
      Plastics, Inc.,
      a
      corporation duly organized and existing under the laws of the State of Delaware
      (the “Company”),
      and
Craig
      D. Hardy
      (“Executive”)
      (referred to collectively herein as the “Parties”).

    

    RECITALS

    

    
      	
              A.

            	
              The
                Company’s Board of Directors (the “Board”)
                has authorized and approved the issuance of shares of the Company’s common
                stock to Stockholder subject to the restrictions set forth herein
                and
                pursuant to the terms hereof.

            

    

    

    
      	
              B.

            	
              The
                shares provided for in this Agreement are to be issued pursuant to
                and in
                connection with Stockholder’s Employment Agreement with the Company dated
                as of August 10, 2007 (the “Employment
                Agreement”).
                Capitalized terms used but not defined herein, have the meanings
                assigned
                to them in the Employment
                Agreement.

            

    

    

    NOW,
      THEREFORE, in consideration of the mutual benefits hereinafter provided, and
      each intending to be legally bound, the Company and Director hereby agree as
      follows:

    

    2.             Issuance
      of Shares.Subject
      to the restrictions, terms and conditions of this Agreement, the Executive
      shall
      be entitled to a combination of (x) restricted grants of common stock, $0.001
      par value (“Common
      Stock”),
      of
      the Company and (y) a common stock purchase warrant to acquire Common Stock
      of
      the Company, a form of warrant is attached to the Employment Agreement as
      Exhibit B, exercisable over a period of four (4) years after grant with respect
      to shares of Common Stock, in the aggregate covering five million (5,000,000)
      shares (collectively, the “Executive
      Shares”).
      As
      used in this Agreement, the term “Shares,”
      “Common
      Stock”
and
      “Executive
      Shares”
refers
      to the Shares issued hereunder and includes all securities received (i) in
      replacement of the Shares, (ii) as a result of stock dividends or stock
      splits in respect of the Shares, and (iii) in replacement of the Shares in
      a recapitalization, merger, reorganization or the like.

    

    The
      market price of the stock at close of market on the day preceding the Effective
      Date will determine the fair market value per share (the “Market
      Value”)
      of
      Common Stock issuable to Executive under this Agreement and Section 3.6 of
      the
      Employment Agreement, at the respective dates of issuance of the Executive
      Shares (as those terms are defined below). As soon as practicable, but in any
      event within thirty (30) days of the date of this Agreement and the Employment
      Agreement, the Company shall issue and deliver to Executive the following equity
      awards based upon the following vesting schedule:

    

    (i)
      one
      million two hundred fifty thousand (1,250,000) shares of Common Stock shall
      vest
      immediately upon issuance; 

    (ii)
      one
      million two hundred fifty thousand (1,250,000) shares of Common Stock shall
      vest
      on the first anniversary of Effective Date; 

    (iii)
      one
      million two hundred fifty thousand (1,250,000) shares shall vest on the second
      anniversary of the Effective Date; and 

    (iv)
      one
      million two hundred fifty thousand (1,250,000) shares shall vest on the third
      anniversary of the Effective Date.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    

    3.              Delivery.

    

    2.1          Deliveries
      by Stockholder.
      Stockholder
      hereby delivers to the Company (i) this Agreement; and (ii) four (4)
      copies of a blank Stock Power and Assignment of Uncertificated Securities in
      the
      form of Exhibit
      A
      attached
      hereto (the “Stock
      Powers”),
      all
      of which are executed by Stockholder (and Stockholder’s spouse or domestic
      partner, if any).

    

    2.2          Deliveries
      by the Company.
      Upon
      its
      receipt of all of the documents to be executed and delivered by Stockholder
      to
      the Company under Section 2.1, the Company will issue the Shares in the name
      of
      Stockholder on the books and records of the Company and send to Stockholder
      any
      notice required by the Delaware General Corporation Law for the issuance of
      uncertificated shares. At such time as the Shares become Vested Shares (as
      defined below), the Company shall issue certificates representing such
      Shares.

    

    3.          Repurchase
      and Vesting.

    

    3.1  Repurchase
      Right for Unvested Shares.
      Unless
      otherwise stated below, as of the Effective Date, all of the Shares are
“Unvested
      Shares”
and
      shall be restricted and based
      on
      the following vesting schedule (shares
      that have vested are referred to herein as “Vested
      Shares”):
      

    

    

    (i) An
      aggregate of five million (5,000,000) shares shall vest on the following
      schedule (i) one million two hundred fifty thousand (1,250,000) shares of Common
      Stock shall vest immediately upon issuance; (ii) one million two hundred fifty
      thousand (1,250,000) shares of Common Stock shall vest on the first anniversary
      of Effective Date; (iii) one million two hundred fifty thousand (1,250,000)
      shares shall vest on the second anniversary of the Effective Date; and (iv)
      one
      million two hundred fifty thousand (1,250,000) shares shall vest on the third
      anniversary of the Effective Date.

    

    3.2  Adjustments.
      The
      number of Shares that are Vested Shares or Unvested Shares will be equitably
      adjusted for any stock split, combination, stock dividend, merger,
      consolidation, reorganization, recapitalization, or any other change in
      corporate structure or other transaction not involving the receipt of
      consideration by the Company occurring after the Effective Date.

    

    4.              Accelerated
      Vesting.
      Stockholder’s
      Unvested Shares shall immediately vest upon the occurrence of a
      Change-of-Control. 

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    5.              Restricted
      Securities.
      Stockholder
      acknowledges and understands that Stockholder may not transfer any Shares unless
      such Shares are registered under the Securities Act and qualified under
      applicable state securities laws or unless, in the opinion of counsel to the
      Company, exemptions from such registration and qualification requirements are
      available. Stockholder understands that only the Company may file a registration
      statement with the Securities and Exchange Commission (the “SEC”)
      and
      that the Company is obligated under the Employment Agreement to do
      so. 

    

    6.              Restrictions
      on Transfers.
      Stockholder agrees not to voluntarily transfer, assign, grant a lien or security
      interest in, pledge, hypothecate, encumber or otherwise dispose of
      (collectively, a “Transfer”)
      any of
      the Unvested Shares. 

    

    7.              Rights
      as Stockholder; Proxy.
      Subject
      to the terms and conditions of this Agreement, Stockholder will have all of
      the
      rights of a holder of Common Stock with respect to the Shares from and after
      the
      date that Stockholder delivers an executed copy of this Agreement until such
      time as Stockholder Transfers the Shares or they are repurchased by the Company.
      All Unvested Shares shall be subject to an irrevocable proxy in the form
      attached as Exhibit
      B
      hereto
      exercisable by the Board of Directors of the Company (with Stockholder
      abstaining) until such time as the shares become Vested Shares.

    

    8.              Tax
      Consequences.
      STOCKHOLDER
      UNDERSTANDS THAT STOCKHOLDER MAY SUFFER ADVERSE TAX CONSEQUENCES AS A RESULT
      OF
      STOCKHOLDER’S ACQUISITION OR DISPOSITION OF THE SHARES. Stockholder hereby
      acknowledges that Stockholder has been informed that, unless an election is
      filed by the Stockholder with the Internal Revenue Service (and, if necessary,
      the proper state taxing authorities) within
      30 days
      of the
      acquisition of the Shares, electing pursuant to Section 83(b) of the Internal
      Revenue Code (and similar state tax provisions, if applicable) to be taxed
      currently on the fair market value on the date of acquisition of the Shares,
      there will be a recognition of taxable income to the Stockholder equal to the
      fair market value of the Shares at the time they are considered transferable
      or
      no longer subject to substantial risk of forfeiture or repurchase for nominal
      consideration. Stockholder
      represents that he has consulted any tax adviser(s) that he deems advisable
      in
      connection with his acquisition of the Shares and the filing of the election
      under Section 83(b) and similar tax provisions.
      A
      form of
      Election under Section 83(b) is attached hereto as Exhibit
      C
      for
      reference.
      STOCKHOLDER HEREBY ASSUMES ALL RESPONSIBILITY FOR FILING OR NOT FILING SUCH
      ELECTION AND PAYING ANY TAXES RESULTING FROM FILING OR FAILING TO FILE SUCH
      ELECTION.

    

    9.              Compliance
      with Laws and Regulations.
      The
      issuance and transfer of the Shares will be subject to and conditioned upon
      compliance by the Company and Stockholder with all applicable state and federal
      laws and regulations and with all applicable requirements of any stock exchange
      or automated quotation system on which the Company’s securities may be listed or
      quoted at the time of such issuance or transfer.

    

    10.            Successors
      and Assigns.
      The
      Company may assign any of its rights under this Agreement. This Agreement shall
      be binding upon and inure to the benefit of the successors and assigns of the
      Company. Subject
      to the restrictions on transfer herein set forth, this Agreement will be binding
      upon Stockholder and Stockholder’s heirs, executors, administrators, successors
      and assigns.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    11.            Governing
      Law; Jurisdiction.
      This
      Agreement shall be interpreted in accordance with the plain meaning of its
      terms
      and under the laws of the State of California. Any controversy between the
      Company and Stockholder arising out of or relating to any of the terms,
      provisions or conditions of this Agreement shall be submitted to arbitration
      in
      accordance with the American Arbitration Association’s National Arbitration
      Rules for the Resolution of Employment Disputes. On the written request of
      either party for arbitration of such a claim pursuant to this paragraph, the
      Company and Stockholder shall both be deemed to have waived the right to
      litigate the claim in any federal or state court. To the extent that any claim
      or controversy arising out of this Agreement cannot be submitted to arbitration
      as set forth above, each party hereby agrees that any suit, action or proceeding
      with respect to this Agreement, and any transactions relating hereto, may be
      brought in the State of California, County of San
      Francisco,
      and
      each of the parties hereby irrevocably consents and submits to the jurisdiction
      of such Court(s) for the purpose of any such suit, action or proceeding. Each
      of
      the parties hereby waives and agrees not to assert, by way of motion, as a
      defense or otherwise, in any such suit, action or proceeding, any claim that
      it
      (he) is not personally subject to the jurisdiction of the above-named Court(s),
      and, to the extent permitted by applicable law, any claim that such suit, action
      or proceeding is brought in an inconvenient forum or that the venue of such
      suit, action or proceeding is improper or that this Agreement or any
      replacements hereof or thereof may not be enforced in or by such Court(s).
      The
      Company shall pay any and all costs associated with arbitration or court
      adjudication.

    

    12.            Notices.
      Any
      notice required to be given or delivered to the Company shall be in writing
      and
      addressed to the Corporate Secretary of the Company at its principal corporate
      offices. Any notice required to be given or delivered to Stockholder hereunder
      shall be in writing and addressed to Stockholder at the last address Stockholder
      provided to the Company. All notices shall be deemed effectively given upon
      personal delivery, three (3) days after deposit in the United States mail by
      certified or registered mail (return receipt requested), one (1) business day
      after its deposit with any return receipt express courier (prepaid), or on
      the
      business day that it is sent by fax to the fax number last provided by
      Stockholder to the Company, but only if (A) the receiving fax device immediately
      generates a message, printed by the sending fax device, that confirms receipt,
      and (B) receipt of the fax is confirmed by a telephone call between sender
      and
      recipient.

    

    13.            Further
      Instruments.
      The
      parties agree to execute such further instruments and to take such further
      action as may be reasonably necessary to carry out the purposes and intent
      of
      this Agreement.

    

    14.            Headings.
      The
      captions and headings of this Agreement are included for ease of reference
      only
      and will be disregarded in interpreting or construing this
      Agreement. All
      references herein to Sections will refer to Sections of this
      Agreement.

    

    15.            Entire
      Agreement.
      This
      Agreement, the Employment Agreement and the other agreements specifically
      referenced herein contain the entire understanding of the parties regarding
      the
      subject matter of this Agreement and such other agreements and supersede all
      prior and contemporaneous negotiations and agreements, whether written or oral,
      between the parties with respect to the subject matter of this Agreement and
      such other agreements.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    -
      SIGNATURE PAGE -

    RESTRICTED
      STOCK AGREEMENT

    

    IN
      WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
      duly authorized representative and Stockholder has executed this Agreement
      as of
      the Effective Date.

     

    
      	
              ECO2
                PLASTICS, INC.

               

            	 	 	STOCKHOLDER
	 	 	 	 
	
              
By:
              Rodney S. Rougelot	 	 	
              

              Name:
                Craig D. Hardy

            
	
              Its:
                Director and CEO

            	 	 	 

    

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    LIST
      OF EXHIBITS

    

    Exhibit
      A: Stock
      Power and Assignment of Uncertificated Securities

    

    Exhibit
      B: Irrevocable
      Proxy

    

    Exhibit
      C: Election
      under Section 83(b) of the Internal Revenue Code

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      A

    

    Stock
      Power and Assignment

    of
      Uncertificated Securities

    

    FOR
      VALUE
      RECEIVED and pursuant to that certain Restricted Stock Agreement dated as of
      _____________, 2007 (the “Agreement”),
      the
      undersigned hereby sells, assigns and transfers unto ECO2
      PLASTICS, INC., a Delaware corporation (the “Company”),
      _______________ uncertificated shares of the Common Stock of the Company,
      standing in the undersigned’s name on the books of the Company delivered
      herewith, and does hereby irrevocably constitute and appoint the Secretary
      of
      the Company as the undersigned’s attorney-in-fact, with full power of
      substitution, to transfer said stock on the books of the Company. 

     

    
      	 	 	 
	Dated:
              ______________________ 	 	
            
	
            	 	STOCKHOLDER
	 	 	 
	 	
              
(Signature)
	 	 
	 	
              
(Please
              Print Name)
	 	 
	 	
              
                

              

              
                (Spouse’s
                  or Domestic

                Partner’s
                  Signature)

              

            
	 	 
	 	
              

              (Please
                Print Spouse’s or 

              Domestic
                Partner’s Name)

            

    

     

    Instructions:
      Please
      do
not
      fill in
      any blanks other than the signature line. The purpose of this Stock Power and
      Assignment of Uncertificated Securities is to enable the Company and/or its
      assignee(s) to acquire the shares upon repurchase by the Company as set forth
      in
      the Agreement without requiring additional signatures on the part of Stockholder
      or Stockholder’s Spouse or Domestic Partner.

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      B

    

    Irrevocable
      Proxy

    

    THE
      UNDERSIGNED STOCKHOLDER, being the owner of _____________
      shares
      of
      common stock (the “Stock”)
      of
      ECO2
      PLASTICS, INC. (the “Company”)
      does
      hereby grant to _____________
      an
      irrevocable and unlimited proxy (the “Proxy”)
      and
      hereby appoints _____________
      his
      attorney-in-fact to vote the Stock in connection with any shareholder meeting
      of
      the Company. 

    

    IN
      WITNESS WHEREOF, I have executed this proxy this _____________
      day of
_____________,
      2007.

    

    
      
        	 	 	 
	 	 	STOCKHOLDER
	 	 	 
	 	 	 
	 	
                
(Signature)
	 	 
	 	
                
(Please
                Print Name)

      

    

    

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      C

    

    Section
      83(b) Election

    

    The
      undersigned taxpayer hereby elects, pursuant to Section 83(b) of the Internal
      Revenue Code, to include in gross income for the taxpayer’s current taxable year
      of the fair market value of the property described below at the time of transfer
      as compensation for services.

    

    
      	
              (1)

            	
              The
                taxpayer who performed the services to ECO2
                PLASTICS, INC. (the “Company”):

            

    

    

    
      	 	
              Name:
                

            

    

    
      	 	
              Address:
                

            

    

    
      	 	
              Social
                Security No.: 

            

    

    

    
      	
              (2)

            	
              The
                property with respect to which the election is made is _____________
                shares of the Common Stock (the “Shares”)
                of the “Company.

            

    

    

    
      	
              (3)

            	
              The
                property was transferred on
                __________________.

            

    

    

    
      	
              (4)

            	
              The
                taxable year for which the election is made is the calendar year
                _____.

            

    

    

    
      	
              (5)

            	
              The
                Shares are subject to the following restrictions: the shares are
                subject
                to vesting based upon continued service as an employee of the Company.
                The
                restrictions described herein are set forth in the Restricted Stock
                Agreement between the Company and taxpayer dated
                ________________.

            

    

    

    
      	
              (6)

            	
              The
                fair market value of a Share at the time of transfer (determined
                without
                regard to any restriction other than a restriction which by its terms
                will
                never lapse) was $____ per Share.

            

    

    

    
      	
              (7)

            	
              No
                consideration was paid by the taxpayer for the
                Shares.

            

    

    

    (8)  A
      copy of
      this statement was furnished to the Company for whom taxpayer rendered the
      services underlying the transfer of such shares.

    

    
      	
              (9)

            	
              This
                statement is executed on
                ___________________.

            

    

    

    
      	 	 	 	 
	
              
Taxpayer  	 	 	
              
Spouse
              or Domestic Partner (if
              any)

    

     

    This
      election must be filed with the Internal Revenue Service Center with which
      the
      Stockholder files his or her federal income tax returns and must be filed within
      30 days after the date of acquisition. This filing should be made by registered
      or certified mail, return receipt requested. The Stockholder must retain two
      copies of the completed form for filing with his or her federal and state tax
      returns for the current tax year and an additional copy for his or her
      records.

    

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    Exhibit
      B

    

    WARRANT

    

    THE
      SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
      ACT OF 1933 (THE “ACT”) OR APPLICABLE STATE SECURITIES LAWS, AND THE TRANSFER
      THEREOF IS PROHIBITED EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION
      S
      UNDER THE ACT, PURSUANT TO REGISTRATION UNDER THE ACT AND APPLICABLE STATE
      SECURITIES LAWS, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION.
      HEDGING TRANSACTIONS INVOLVING THESE SECURITIES MAY NOT BE CONDUCTED UNLESS
      IN
      COMPLIANCE WITH THE ACT

    

    

    Warrant
      To Purchase _________ Shares of Common Stock

    

    ECO2
      PLASTICS, INC.

    (f.k.a.,
      Itec Environmental Group, Inc.)

    

    Date
      of
      Issuance: _____________

    

    No.
      _____

    

    THIS
      CERTIFIES that, for value received, Craig D. Hardy, or his/her/its assigns
      (in
      either case, the “Holder”) is entitled to purchase, subject to the provisions of
      this Warrant, from ECO2
      Plastics, Inc., a Delaware corporation (the “Company”), at the price per share
      set forth in Section 8 hereof, that number of shares of the Company’s common
      stock (the “Common Stock”) set forth in Section 7 hereof. This Warrant is
      referred to herein as the “Warrant” and the shares of Common Stock issuable
      pursuant to the terms hereof are sometimes referred to herein as “Warrant
      Shares.”

    

    1.           Holder
      Exercise of Warrant.
      This
      Warrant shall only be exercisable in whole. To exercise this Warrant in whole,
      the Holder shall deliver to the Company at its principal office, (a) a written
      notice, in substantially the form of the exercise notice attached hereto as
      Exhibit
      A
      (the
“Exercise Notice”), of the Holder’s election to exercise this Warrant, which
      notice shall specify the number of shares of Common Stock to be purchased and
      (b) this Warrant. The Company shall as promptly as practicable, and in any
      event
      within twenty (20) days after delivery to the Company of (i) the Exercise
      Notice, (ii) and this Warrant, execute and deliver or cause to be executed
      and
      delivered, in accordance with such notice, a certificate or certificates
      representing the aggregate number of shares of Common Stock specified in such
      notice, provided this Warrant has vested on or prior to the date such notice
      is
      delivered. Each certificate representing Warrant Shares shall bear the legend
      or
      legends required by applicable securities laws as well as such other legend(s)
      the Company requires to be included on certificates for its Common Stock. The
      Company shall pay all expenses and other charges payable in connection with
      the
      preparation, issuance and delivery of such stock certificates except that,
      in
      case such stock certificates shall be registered in a name or names other than
      the name of the Holder, funds sufficient to pay all stock transfer taxes that
      are payable upon the issuance of such stock certificate or certificates shall
      be
      paid by the Holder at the time of delivering the Exercise Notice. All shares
      of
      Common Stock issued upon the exercise of this Warrant shall be validly issued,
      fully paid, and nonassessable. 

    

    The
      Warrant shall expire on ___________ (the “Expiration Date”). The Investor may
      exercise the warrant at any time prior to the Expiration Date. The Company
      has
      no restriction on the sale or transfer of the Warrant or Warrant Shares;
      however, the Investor is required to comply with all state and U.S. laws and
      regulations relating to security sales and transfers.

    

    2.  Reservation
      of Shares.
      The
      Company hereby covenants that at all times during the term of this Warrant
      there
      shall be reserved for issuance such number of shares of its Common Stock as
      shall be required to be issued upon exercise of this Warrant. 

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    3.           Fractional
      Shares.
      This
      Warrant may be exercised only for a whole number of shares of Common Stock,
      and
      no fractional shares or scrip representing fractional shares shall be issuable
      upon the exercise of this Warrant. 

    

    4.           Transfer
      of Warrant and Warrant Shares.
      The
      Holder may sell, pledge, hypothecate, or otherwise transfer this Warrant, in
      whole, in accordance with and subject to the terms and conditions set forth
      in
      this Warrant and then only if such sale, pledge, hypothecation, or transfer
      is
      made in compliance with the Act or pursuant to an available exemption from
      registration under the Act relating to the disposition of
      securities.

    

    5.          Loss
      of Warrant.
      Upon
      receipt by the Company of evidence satisfactory to it of the loss, theft, or
      destruction of this Warrant, and of indemnification satisfactory to it, or
      upon
      surrender and cancellation of this Warrant, if mutilated, the Company will
      execute and deliver a new warrant of like tenor. 

    

    6.           Rights
      of the Holder.
      No
      provision of this Warrant shall be construed as conferring upon the Holder
      the
      right to vote, consent, receive dividends or receive notice other than as
      expressly provided herein. Prior to exercise, no provision hereof, in the
      absence of affirmative action by the Holder to exercise this Warrant, and no
      enumeration herein of the rights or privileges of the Holder, shall give rise
      to
      any liability of the holder for the purchase price of any warrant shares or
      as a
      stockholder of the Company, whether such liability is asserted by the Company
      or
      by creditors of the Company. 

    

    7.           Number
      of Warrant Shares.
      This
      Warrant shall be exercisable for __________ shares of the Company’s Common
      Stock, as adjusted in accordance with this Agreement. 

    

    8.           Exercise
      Price; Adjustment of Warrants.
      

    

    a.
       Determination
      of Exercise Price.
      The per
      share purchase price (the “Exercise Price”) for each of the Warrant Shares
      purchasable under this Warrant shall be equal to $_____. 

     

    b. Net
      Issue Exercise.
      In lieu
      of exercising this Warrant, the Holder may elect to receive Shares equal to
      the
      value of this Warrant (or the portion thereof being canceled) by surrender
      of
      this Warrant at the principal office of the Company together with notice of
      such
      election, in which event the Company shall issue to the Holder a number of
      Shares computed using the following formula:

    

    X
      = Y
      (A-B)

    -------

    A

     

    Where
      X
 =
      the
      number of the Shares to be issued to the Holder.

    

      Y
        =
      the
      number of the Shares purchasable under this Warrant.

    

      A
        =
      the
      fair market value of one Share on the date of determination.

    

      B
        =
      the per
      share Exercise Price (as adjusted to the date of such calculation).

    

    Fair
      Market Value.
      For
      purposes of this section, the per share fair market value of the Shares shall
      mean:

    

    (i)
       If
      the
      Company's Common Stock is publicly traded, the per share fair market value
      of
      the Shares shall be the average of the closing prices of the Common Stock as
      quoted on the Nasdaq National Market or the principal exchange on which the
      Common Stock is listed, or if not so listed then the fair market value shall
      be
      the average of the closing bid prices of the Common Stock as published in The
      Wall Street Journal, in each case for the fifteen (15) trading days ending
      five
      (5) trading days prior to the date of determination of fair market
      value;

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    (ii)
       If
      the
      Company's Common Stock is not so publicly traded, the per share fair market
      value of the Shares shall be such fair market value as is determined in good
      faith by the Board of Directors of the Company after taking into consideration
      factors it deems appropriate, including, without limitation, recent sale and
      offer prices of the capital stock of the Company in private transactions
      negotiated at arm's length.

    

    c.            Adjustment
      for Mergers or Reorganization, etc.
      In case
      of any consolidation or merger of the Company with or into another corporation
      or the conveyance of all or substantially all of the assets of the Company
      to
      another corporation, this Warrant shall be exercisable into the number of shares
      of stock or other securities or property to which a holder of the number of
      shares of Common Stock of the Company deliverable upon exercise of this Warrant
      would have been entitled upon such consolidation, merger or conveyance; and,
      in
      any such case, appropriate adjustment (as determined by the Board of Directors
      of the Company) shall be made in the application of the provisions herein set
      forth with respect to the rights and interest thereafter of the holder of this
      Warrant, to the end that the provisions set forth herein shall thereafter be
      applicable, as nearly as reasonable may be, in relation to any shares of stock
      or other property thereafter deliverable upon the exercise of this Warrant.
      

    

    d.            NO
      IMPAIRMENT.
      THE
      COMPANY WILL NOT, THROUGH ANY REORGANIZATION, TRANSFER OF ASSETS, CONSOLIDATION,
      MERGER, DISSOLUTION, ISSUE OR SALE OF SECURITIES OR ANY OTHER VOLUNTARY ACTION,
      AVOID OR SEEK TO AVOID THE OBSERVANCE OR PERFORMANCE OF ANY OF THE TERMS TO
      BE
      OBSERVED OR PERFORMED HEREUNDER BY THE COMPANY, BUT WILL AT ALL TIMES IN GOOD
      FAITH ASSIST IN THE CARRYING OUT OF ALL THE PROVISIONS OF THIS SECTION AND
      IN
      THE TAKING OF ALL SUCH ACTION AS MAY BE NECESSARY OR APPROPRIATE IN ORDER TO
      PROTECT THE EXERCISE RIGHTS OF THE HOLDER OF THIS WARRANT AGAINST IMPAIRMENT.
      

    

    e.            Issue
      Taxes.
      The
      Company shall pay issue taxes that may be payable in respect of any issue or
      delivery of shares of Common Stock on exercise of this Warrant, in whole;
      provided, however, that the Company shall not be obligated to pay any transfer
      taxes resulting from any transfer requested by any holder in connection with
      any
      such exercise. 

    

    f.             Reservation
      of Stock Issuable Upon Conversion.
      The
      Company shall at all times reserve and keep available out of its authorized
      but
      unissued shares of common stock, solely for the purpose of effecting the
      exercise of this Warrant, such number of its shares of common stock as shall
      from time to time be sufficient to effect the exercise of this Warrant; and
      if
      at any time the number of authorized but unissued shares of common stock shall
      not be sufficient to effect the exercise of this Warrant, the Company will
      take
      all appropriate corporate action as may, in the opinion of its counsel, be
      necessary to increase its authorized but unissued shares of common stock to
      such
      number of shares as shall be sufficient for such purpose. 

    

    g.            Adjustment.
      The
      Exercise Price shall be adjusted downward in the event the Company issues common
      stock (or securities exercisable for or convertible into or exchangeable for
      common stock) at a price below the Exercise Price, to a price equal to such
      issue price.

    

    9.          Certain
      Distributions.
      In case
      the Company shall, at any time, prior to the Expiration Date, declare any
      distribution of its assets to holders of its common stock as a partial
      liquidation, distribution or by way of return of capital, other than as a
      dividend payable out of earnings or any surplus legally available for dividends,
      then the Holder shall be entitled, upon the proper exercise of this Warrant
      in
      whole prior to the effecting of such declaration, to receive, in addition to
      the
      shares of common stock issuable on such exercise, the amount of such assets
      (or
      at the option of the Company a sum equal to the value thereof at the time of
      such distribution to holders of common stock as such value is determined by
      the
      Board of Directors of the Company in good faith), which would have been payable
      to the Holder had it been a holder of record of such shares of common stock
      on
      the record date for the determination of those holders of Common Stock entitled
      to such distribution. 

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    10.         Dissolution
      or Liquidation.
      In case
      the Company shall, at any time prior to the Expiration Date, dissolve, liquidate
      or wind up its affairs, the Holder shall be entitled, upon the proper exercise
      of this Warrant in whole and prior to any distribution associated with such
      dissolution, liquidation, or winding up, to receive on such exercise, in lieu
      of
      the shares of Common Stock to which the Holder would have been entitled, the
      same kind and amount of assets as would have been distributed or paid to the
      Holder upon any such dissolution, liquidation or winding up, with respect to
      such shares of Common Stock had the Holder been a holder of record of such
      share
      of Common Stock on the record date for the determination of those holders of
      Common Stock entitled to receive any such dissolution, liquidation, or winding
      up distribution. 

    

    11.         Reclassification
      or Reorganization.
      In case
      of any reclassification, capital reorganization or other change of outstanding
      shares of common stock of the Company (other than a change in par value, or
      from
      par value to no par value, or from no par value to par value, or as a result
      of
      an issuance of common stock by way of dividend or other distribution or of
      a
      subdivision or combination), the Company shall cause effective provision to
      be
      made so that the Holder shall have the right thereafter by exercising this
      Warrant, to purchase the kind and amount of shares of stock and other securities
      and PROPERTY RECEIVABLE UPON SUCH RECLASSIFICATION, CAPITAL REORGANIZATION
      OR
      OTHER CHANGE, BY A HOLDER OF THE NUMBER OF SHARES OF COMMON STOCK WHICH MIGHT
      HAVE BEEN PURCHASED UPON EXERCISE OF THIS WARRANT IMMEDIATELY PRIOR TO SUCH
      RECLASSIFICATION OR CHANGE. ANY SUCH PROVISION SHALL INCLUDE PROVISION FOR
      ADJUSTMENTS WHICH SHALL BE AS NEARLY EQUIVALENT AS MAY BE PRACTICABLE TO THE
      ADJUSTMENTS PROVIDED FOR IN THIS WARRANT. THE FOREGOING PROVISIONS OF THIS
      SECTION 12 SHALL SIMILARLY APPLY TO SUCCESSIVE RECLASSIFICATIONS, CAPITAL
      REORGANIZATIONS AND CHANGES OF SHARES OF COMMON STOCK. IN THE EVENT THAT IN
      ANY
      SUCH CAPITAL REORGANIZATION, RECLASSIFICATION, OR OTHER CHANGE, ADDITIONAL
      SHARES OF COMMON STOCK SHALL BE ISSUED IN EXCHANGE, CONVERSION, SUBSTITUTION
      OR
      PAYMENT, IN WHOLE, FOR OR OF A SECURITY OF THE COMPANY OTHER THAN COMMON STOCK,
      ANY AMOUNT OF THE CONSIDERATION RECEIVED UPON THE ISSUE THEREOF BEING DETERMINED
      BY THE BOARD OF DIRECTORS OF THE COMPANY SHALL BE FINAL AND BINDING ON THE
      HOLDER. 

    

    12.         Miscellaneous.
      

    

    a.             Successors
      and Assigns.
      The
      terms and conditions of this Agreement shall inure to the benefit of, and be
      binding upon, the respective successors and assigns of the parties, except
      to
      the extent otherwise provided herein. Nothing in this Agreement, express or
      implied, is intended to confer upon any party, other than the parties hereto
      or
      their respective successors and assigns, any rights, remedies, obligations
      or
      liabilities under or by reason of this Agreement, except as expressly provided
      in this Agreement. 

    

    b.             Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of California without regard to the principles of conflict of laws
      thereof. 

    

    c.             Counterparts;
      Delivery by Facsimile.
      This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed an original, but all of which together shall constitute one and the
      same
      instrument. Delivery of this Agreement may be effected by facsimile.

    

    d.             Titles
      and Subtitles.
      The
      titles and subtitles used in this Agreement are used for convenience only and
      are not to be considered in construing or interpreting this Agreement.

    

                e.             Notices.
      Unless
      otherwise provided, any notice required or permitted hereunder shall be given
      by
      personal service upon the party to be notified by certified mail, return receipt
      requested and: (i) if to the Company, addressed to ECO2
      Plastics, Inc., 680 Second Street, Suite 200 San
      Francisco, California 94107, or at such other address as the Company may
      designate by notice to each of the Investors in accordance with the provisions
      of this Section; and (ii) if to the Warrant holder, at the address indicated
      on
      the signature page hereof, or at such other addresses as such Holder may
      designate by notice to the Company in accordance with the provisions of this
      Section. 

    

    f.             Amendments
      and Waivers.
      Any
      term of this Agreement may be amended and the observance of any term of this
      Agreement may be waived (either generally or in a particular instance and either
      prospectively or retroactively), only with the written consent of the Company
      and a majority in interest of the Holders. 

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    g.             Entire
      Agreement.
      This
      Agreement, the Memorandum (including the appendices and schedules thereto)
      by
      and between the Company and the Holder, constitute the entire agreement among
      the parties hereto with respect to the subject matter hereof and thereof and
      supersede all prior agreements, understandings, negotiations and discussions,
      whether oral or written, of the parties hereto. 

    

    IN
      WITNESS WHEREOF, the undersigned hereby sets is hand and seal this ___ day
      of
      ___________, 2007. 

    
       

      
        	
                ECO2
                  Plastics, Inc.

              	 	 	 
	 	 	 	 
	By: 	 	 	 
	
                
                  
Name:
                  Rodney Rougelot

              	 	 	
              
	
                Title:
                  Chief Executive Officer

              	 	 	 
	 	 	 	 
	Investor Name:	 	 	 
	
                
                  

                

              	 	 	 
	Investor Address: 	 	 	 
	
                
                  

                

                 

                
                  
 

              	 	 	 

      

       

      
        
          
          

        

        
          29

          
            

          

        

        
          
          

        

      

    

     

    EXHIBIT
      A

     

    NOTICE
      OF
      EXERCISE

     

    (To
      be
      signed only upon exercise of the Warrant)

     

    To:
      ECO2
      Plastics, Inc.

     

    The
      undersigned, hereby irrevocably elects to exercise the purchase rights
      represented by the Warrant granted to the undersigned on ______________ and
      to
      purchase thereunder __________* shares of Common Stock of ECO2
      Plastics, Inc. (the “Company”).

     

    
      
        	Dated: ________________	 	 
	 	 	 
	 	
                
(Signature
                must conform in all respects to name of
                holder as specified on the face of the Warrant)
	 	 
	 	
                
(Please
                Print Name)
	 	 
	 	
                
                  

                

                
                  (Address)

                

              

      

       

    

    *
      Insert
      here the number of shares being exercised, without making any adjustment for
      additional Common Stock of the Company, other securities or property which,
      pursuant to the adjustment provisions of the Warrant, may be deliverable upon
      exercise. 

     

    
      
        
        

      

      
        30THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR ANY STATE SECURITIES LAWS. NO INTEREST IN THIS NOTE MAY BE
OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE ACT AND APPLICABLE STATE LAWS, (ii) TO THE EXTENT APPLICABLE, PURSUANT TO
RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER THE ACT), OR (iii) AN
EXEMPTION FROM REGISTRATION UNDER THE ACT AND APPLICABLE STATE LAWS WHERE PAYEE
HAS FURNISHED TO THE COMPANY AN OPINION OF ITS COUNSEL THAT AN REGISTRATION IS
NOT REQUIRED.

                                 ASKMENOW, INC.

                           12% JUNIOR PROMISSORY NOTE

$                                                            _____________, 2007

      FOR VALUE RECEIVED, the undersigned, AskMeNow, Inc., a Delaware
corporation (the "Company" or "Payor"), having its executive office and
principal place of business at 26 Executive Park, Suite 250, Irvine, CA 92614,
hereby promises to pay to ______________________, [a corporation with its
principal place of business at _______________] [an individual residing at
____________________] (the "Payee") at such address for Payee (or at such other
place as Payee may from time to time hereafter direct by notice in writing to
Payor), the principal sum of ______________ Dollars ($ ), in such coin or
currency of the United States of America as at the time shall be legal tender
for the payment of public and private debts, on the first to occur of the
following dates: (i) ___________, 2007 (180 days after the date of issuance of
this Note) (the "Maturity Date") unless extended by the Payor for up to an
additional 90 days (the "Extended Maturity Date"); (ii) the date on which the
outstanding principal amount of this Note is prepaid in full as hereinafter
permitted (the "Prepayment Date"); (iii) the date on which the Company raises at
least Ten Million Dollars ($10,000,000) in equity financing or a proportionate
repayment on such amount less than $10,000,000 (the "Funding Date"), and (iv)
any other date on which any principal amount of, or accrued unpaid interest on,
this Note is declared to be, or becomes, due and payable pursuant to its terms
prior to the Maturity Date (the "Acceleration Date").

      This Note is being issued in connection with a bridge financing (the
"Bridge Offering") by the Company on a "best efforts" no minimum basis, up to a
maximum of $1,000,000 of Bridge Offering units (each a "Bridge Unit"). Each
Bridge Unit consists of $1.00 principal amount of 12% Promissory Notes and
Warrants to purchase two (2) shares of common stock, $.01 par value, of the
Company (the "Common Stock"), to be offered on a "best efforts" basis. The
Bridge Offering is being made only to Investors who qualify as "accredited
investors" as such term is defined in Rule 501 of Regulation D under the
Securities Act of 1933, as amended (the "Act"). Partial Bridge Units may be sold
by the Company in its sole discretion.

      All of the proceeds of the Bridge Offering will be used by the Company for
general corporate purposes, including working capital.

<PAGE>

      1. Interest And Payment.

      1.1. The principal amount of this Note outstanding from time to time shall
bear simple interest at the annual rate (the "Note Rate") of twelve (12%)
percent from the date hereof through the earliest to occur of (i) the Maturity
Date; (ii) the Prepayment Date; (iii) the Funding Date or (iv) the Acceleration
Date.

      1.2. Interest accrued on this Note shall be payable on the earliest to
occur of (i) the Maturity Date (if not extended); (ii) the Prepayment Date;
(iii) the Funding Date; (iv) the Acceleration Date; or (v) the Extended Maturity
Date.

      1.3. All payments made by the Payor on this Note shall be applied first to
the payment of accrued unpaid interest on this Note and then to the reduction of
the unpaid principal balance of this Note.

      1.4. In the event that the date for the payment of any amount payable
under this Note falls due on a Saturday, Sunday or public holiday under the laws
of the State of California, the time for payment of such amount shall be
extended to the next succeeding business day and interest at the Note Rate shall
continue to accrue on any principal amount so effected until the payment thereof
on such extended due date.

      2. Replacement Of Note.

      2.1. In the event that this Note is mutilated, destroyed, lost or stolen,
Payor shall, at its sole expense, execute, register and deliver a new Note, in
exchange and substitution for this Note, if mutilated, or in lieu of and
substitution for this Note, if destroyed, lost or stolen. In the case of
destruction, loss or theft, Payee shall furnish to Payor indemnity reasonably
satisfactory to Payor, and in any such case, Payee shall also furnish to Payor
evidence to its reasonable satisfaction of the mutilation, destruction, loss or
theft of this Note and of the ownership thereof. Any replacement Note so issued
shall be in the same outstanding principal amount as this Note and dated the
date to which interest shall have been paid on this Note or, if no interest
shall have yet been paid, dated the date of this Note.

      2.2. Every Note issued pursuant to the provisions of Section 2.1 above in
substitution for this Note shall constitute a contractual obligation of the
Payor, whether or not this Note shall be found at any time or be enforceable by
anyone.

      3. Prepayment. The principal amount of this Note may be prepaid in whole
at any time, or in part from time to time, without penalty or premium, together
with unpaid interest thereon. Each partial prepayment of this Note shall first
be applied to accrued unpaid interest and then to principal.

      4. Covenants of Payor.

      Payor covenants and agrees that, so long as this Note remains outstanding
and unpaid, in whole or in part:

      4.1. Payor will not sell, transfer or dispose of a material part of its
assets;

      4.2. Payor will not make any loan to any person who is or becomes a
shareholder or executive employee of Payor, other than for reasonable advances
for expenses in the ordinary course of business;

                                       -2-

<PAGE>

      4.3. Payor will promptly pay and discharge all lawful taxes, assessments
and governmental charges or levies imposed upon it, its income and profits, or
any of its property, before the same shall become in default, as well as all
lawful claims for labor, materials and supplies which, if unpaid, might become a
lien or charge upon such properties or any part thereof; provided, however, that
Payor or such subsidiary shall not be required to pay and discharge any such
tax, assessment, charge, levy or claim so long as the validity thereof shall be
contested in good faith by appropriate proceedings and Payor or such subsidiary,
as the case may be, shall set aside on its books adequate reserves (if required
by generally accepted accounting principles) with respect to any such tax,
assessment, charge, levy or claim so contested;

      4.4. Payor will do or cause to be done all things necessary to preserve
and keep in full force and effect its corporate existence, rights and franchises
and substantially comply with all laws applicable to Payor as its counsel may
advise;

      4.5. Payor will at all times maintain, preserve, protect and keep its
property used or useful in the conduct of its business in good repair, working
order and condition (except for the effects of reasonable wear and tear in the
ordinary course of business) and will, from time to time, make all necessary and
proper repairs, renewals, replacements, betterments and improvements thereto;

      4.6. Payor will keep adequately insured, by financially sound reputable
insurers, all property of a character usually insured by similar corporations
and carry such other insurance as is usually carried by similar corporations;

      4.7. Payor will, promptly following the occurrence of an Event of Default
or of any condition or event which, with the giving of notice or the lapse of
time or both, would constitute an Event of Default, furnish a statement of
Payor's Chief Executive Officer or Chief Financial Officer to Payee setting
forth the details of such Event of Default or condition or event and the action
which Payor intends to take with respect thereto;

      4.8. Payor will, and will cause each of its subsidiaries to, at all times
maintain books of account in which all of its financial transactions are duly
recorded in conformance with generally accepted accounting principles;

      4.9. Payor shall not create, incur, assume or suffer to exist any pledge,
hypothecation, assignment, deposit arrangement, lien ), charge, claim, or
security interest, mortgage, deed of trust, easement or encumbrance, or
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever ( except for liens for taxes not yet due and
payable or being contested in good faith, mechanics' materialmen's or similar
liens, and liens securing rental or lease payments, together the "Permitted
Liens") with respect to the assets of Payor or such subsidiary; and

      4.10. Payor shall not issue any debt, equity or other instrument which
would give the holder thereof, directly or indirectly, a right in any assets of
Payor or such subsidiary that are pari passu, senior or superior to any right of
the Payee in or to such assets.

                                       -3-

<PAGE>

      5. Events of Default. If any of the following events (each an "Event of
Default") occurs:

      5.1. The dissolution of Payor or any vote in favor thereof by the board of
directors and shareholders of Payor;

      5.2. Payor makes an assignment for the benefit of creditors, or files with
a court of competent jurisdiction an application for appointment of a receiver
or similar official with respect to it or any substantial part of its assets, or
Payor files a petition seeking relief under any provision of the Federal
Bankruptcy Code or any other federal or state statute now or hereafter in effect
affording relief to debtors, or any such application or petition is filed
against Payor, which application or petition is not dismissed or withdrawn
within sixty (60) days from the date of its filing;

      5.3. Payor fails to pay the principal amount, or interest on, or any other
amount payable under, this Note within ten (10) days of the date such amount
becomes due and payable;

      5.4. Payor admits in writing its inability to pay its debts as they
mature;

      5.5. Payor sells all or substantially all of its assets or merges or is
consolidated with or into another corporation, other than a merger with or into
a publicly traded corporation or a merger to change Payor's jurisdiction of
incorporation;

      5.6. A proceeding is commenced to foreclose a security interest or lien in
any property or assets of Payor as a result of a default in the payment or
performance of any debt (in excess of $50,000 and secured by such property or
assets) of Payor or of any subsidiary of Payor;

      5.7. A final judgment for the payment of money in excess of $50,000 is
entered against Payor by a court of competent jurisdiction, and such judgment is
not discharged (nor the discharge thereof duly provided for) in accordance with
its terms, nor a stay of execution thereof procured, within sixty (60) days
after the date such judgment is entered, and, within such period (or such longer
period during which execution of such judgment is effectively stayed), an appeal
therefrom has not been prosecuted and the execution thereof caused to be stayed
during such appeal;

      5.8. An attachment or garnishment is levied against the assets or
properties of Payor or any subsidiary of Payor involving an amount in excess of
$50,000 and such levy is not vacated, bonded or otherwise terminated within
sixty (60) days after the date of its effectiveness;

      5.9. Payor defaults in the due observance or performance of any covenant,
condition or agreement on the part of Payor to be observed or performed pursuant
to the terms of this Note (other than the default specified in Section 5.3
above) and such default continues uncured for a period of sixty (60) days

      5.10. Payor fails to pay the principal amount, or interest on, or any
other amount payable under, this Note as and when the same becomes due and
payable (as specified in Section 5.3 above), the Company will pay the Payee a
default interest rate of two (2%) per month on all amounts due and owing under
the Note for each month or part thereof beyond the Maturity Date or the Extended
Maturity Date, which default interest shall be payable in cash on demand in
cash;

                                       -4-

<PAGE>

      5.11. Payor creates, incurs, assumes or suffers to exist any pledge,
hypothecation, assignment, deposit arrangement, lien, charge, claim, or security
interest, mortgage, deed of trust, easement or encumbrance, or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (except permitted Liens) with respect to the assets of Payor
or such subsidiary; or

      5.12. If Payor issues any debt, equity or other instrument which would
give the holder thereof, directly or indirectly, a right in any assets of Payor
or such subsidiary that are senior or superior to any right of the Payee in or
to such assets.

      6. Suits for Enforcement and Remedies. Upon the occurrence of an Event of
Default and Payor's failure to cure such default, the Payee shall have the
right, at Payee's option, to declare the principal of, accrued unpaid interest
on, and all other amounts payable under this Note to be forthwith due and
payable, and, in the case of an Event of Default pursuant to Section 5.3 above,
the Payee shall automatically be entitled to full and immediate payment of all
amounts due under this Note without any action on the part of or declaration by
Payee required. If any one or more Events of Default shall occur and be
continuing, the Payee further may proceed to (i) protect and enforce Payee's
rights either by suit in equity or by action at law, or both, whether for the
specific performance of any covenant, condition or agreement contained in this
Note or in any agreement or document referred to herein or in aid of the
exercise of any power granted in this Note or in any agreement or document
referred to herein, (ii) enforce the payment of this Note, or (iii) enforce any
other legal or equitable right of Payee. No right or remedy herein or in any
other agreement or instrument conferred upon Payee is intended to be exclusive
of any other right or remedy, and each and every such right or remedy shall be
cumulative and shall be in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or by statute or
otherwise.

      7. Unconditional Obligation; Fees, Waivers, Other.

      7.1. The obligations to make the payments provided for in this Note are
absolute and unconditional and not subject to any defense, set-off,
counterclaim, rescission, recoupment or adjustment whatsoever.

      7.2. If, following the occurrence of an Event of Default, Payee shall seek
to enforce the collection of any amount of principal of and/or interest on this
Note, there shall be immediately due and payable from Payor, in addition to the
then unpaid principal of, and accrued unpaid interest on, this Note, all costs
and expenses incurred by Payee in connection therewith, including, without
limitation, reasonable attorneys' fees and disbursements.

      7.3. No forbearance, indulgence, delay or failure to exercise any right or
remedy with respect to this Note shall operate as a waiver or as an acquiescence
in any default, nor shall any single or partial exercise of any right or remedy
preclude any other or further exercise thereof or the exercise of any other
right or remedy.

      7.4. This Note may not be modified or discharged (other than by payment or
exchange) except by a writing duly executed by Payor and Payee.

                                       -5-

<PAGE>

      7.5. Payor hereby expressly waives demand and presentment for payment,
notice of nonpayment, notice of dishonor, protest, notice of protest, bringing
of suit, and diligence in taking any action to collect amounts called for
hereunder, and shall be directly and primarily liable for the payment of all
sums owing and to be owing hereon, regardless of and without any notice,
diligence, act or omission with respect to the collection of any amount called
for hereunder or in connection with any right, lien, interest or property at any
and all times which Payee had or is existing as security for any amount called
for hereunder.

      8. Restriction on Transfer. This Note has been acquired for investment,
and this Note has not been registered under the securities laws of the United
States of America or any state thereof, including the Act. Accordingly, no
interest in this Note may be offered for sale, sold or transferred in the
absence of registration and qualification of this Note, under applicable federal
and state securities laws, including the Act, or an opinion of counsel of Payee
reasonably satisfactory to Payor that such registration and qualification are
not required.

      9. Subordination. The rights of the Payee hereunder in and to the assets
of the Company are hereby expressly subordinated to the rights in and to such
assets of the holders of the Company's Senior Indebtedness, as hereinafter
defined. Senior Indebtedness shall mean those certain 12% Senior Promissory
Notes issued by the Company in its $3,000,000 best efforts, no minimum bridge
offering completed in May 2007. Subject to the rights of the holders of Senior
Indebtedness, nothing contained in this Section 9 shall impair, as between the
Payor and the Payee, the obligation of the Payor, subject to the terms and
conditions hereof, to pay to the Payee the principal hereof and interest hereon
as and when the same become due and payable, or shall prevent the Payee, upon
default hereunder, from exercising all rights, powers and remedies otherwise
provided herein or by applicable law.

      10. Miscellaneous.

      10.1. The headings of the various paragraphs of this Note are for
convenience of reference only and shall in no way modify any of the terms or
provisions of this Note.

      10.2. All notices required or permitted to be given hereunder shall be in
writing and shall be deemed to have been duly given when personally delivered or
sent by registered or certified mail (return receipt requested, postage
prepaid), facsimile transmission or overnight courier to the address of the
intended recipient as set forth in the preamble to this Note or at such other
address as the intended recipient shall have hereafter given to the other party
hereto pursuant to the provisions of this Note.

      10.3. This Note and the obligations of Payor and the rights of Payee shall
be governed by and construed in accordance with the substantive laws of the
State of California without giving effect to the choice of laws rules thereof.

      10.4. This Note shall bind Payor and its successors and assigns. Neither
the Payor nor the Payee may assign this Note without the prior written consent
of the other party, provided that under no circumstances may the Payee assign
this Note to any individual or entity that is a competitor, directly or
indirectly, with the Payor.

                                       -6-

<PAGE>

                                       ASKMENOW, INC.

                                       By:
                                           -------------------------------------
                                       Name: Darryl Cohen
                                       Title: CEO

                                       -7-

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