Document:

JIM
      MCDEVITT

    EMPLOYMENT
      AGREEMENT

     

    Agreement
      dated as of December 28, 2007, between CAPITAL GROWTH SYSTEMS, INC.,
      a Florida corporation, having a place of business at 500 W. Madison Street,
      Suite 2060, Chicago, Illinois 60661 (the “Company”), and JIM
      MCDEVITT
      (the “Executive”).

     

    WITNESSETH

     

    WHEREAS,
      the Company wishes Executive to serve as Chief Financial Officer, Secretary,
      Treasurer, and Senior Vice President - Finance of the Company during the term
      of
      this Agreement and Executive wishes to serve in such capacity, subject to the
      terms and conditions hereof;

     

    WHEREAS,
      the Board of Directors (“Board”) of the Company believes it to be in the best
      interests of the Company to enter into this Agreement to assure Executive’s
      services to the Company and to encourage Executive’s full attention and
      dedication to the Company; and

     

    WHEREAS,
      in order to accomplish all the above objectives, the Board has authorized the
      Company to enter into this Agreement;

     

    NOW,
      THEREFORE, in consideration of the mutual promises herein contained, including
      the foregoing recitals which are made a part hereof, the Company and Executive
      hereby agree as follows:

     

    1. Certain
      Definitions.

     

    (a) The
      “Effective Date” shall mean January 1, 2008.

     

    (b) The
      “Change-in-Control Date” shall mean the first date during the Employment Period
      (as defined in Section 1(c)) on which a Change-in-Control (as defined in Section
      2) occurs.

     

    (c) The
      “Employment Period” shall mean the period commencing on the Effective Date and
      ending on the second (2nd) anniversary of such date; provided, however, that
      on
      each anniversary of the Effective Date, and on each successive annual
      anniversary of such date thereafter (such date and each annual anniversary
      thereof shall be hereinafter referred to as the “Renewal Date”), the Employment
      Period shall be automatically extended so as to terminate on one (1) year from
      such Renewal Date, unless at least ninety (90) days prior to the Renewal Date
      either party shall give notice to the other that the Employment Period shall
      not
      be so extended; and provided, further, that upon the occurrence of a
      Change-in-Control Date, the Employment Period shall automatically be extended
      so
      as to terminate on the first (1st) anniversary of such date.

     

    2. Change-in-Control.
      For the purpose of this Agreement, a “Change-in-Control” shall
      mean:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (a) The
      acquisition by an individual, entity or group (within the meaning of Section
      13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the
      “Exchange Act”)) of beneficial ownership (within the meaning of Rule 13d-3
      promulgated under the Exchange Act) of fifty percent (50%) or more of either
      (i)
      the then outstanding shares of common stock of Company (the “Outstanding Company
      Common Stock”) or (ii) the combined voting power of the then outstanding voting
      securities of the Company entitled to vote generally in the election of
      directors (the “Outstanding Company Voting Securities”); provided, however, that
      the following acquisitions shall not constitute a Change-in-Control: (w) any
      acquisition directly from the Company, (x) any acquisition by the Company or
      any
      of its subsidiaries, (y) any acquisition by any employee benefit plan (or
      related trust) sponsored or maintained by the Company or any of its subsidiaries
      or (z) any acquisition by any corporation with respect to which, following
      such
      acquisition, more than fifty percent (50%) of, respectively, the then
      outstanding shares of common stock of such corporation and the combined voting
      power of the then outstanding voting securities of such corporation entitled
      to
      vote generally in the election of directors, is then beneficially owned,
      directly or indirectly, by all or substantially all of the individuals and
      entities who were beneficial owners, respectively of the Outstanding Company
      Common Stock and Outstanding Company Voting Securities in substantially the
      same
      proportions as their ownership, immediately prior to such acquisition, of the
      Outstanding Company Common Stock and Outstanding Company Voting Securities,
      as
      the case may be; or

     

    (b) Completion
      by the Company of a reorganization, merger or consolidation, in each case,
      with
      respect to which all or substantially all of the individuals and entities who
      were the beneficial owners, respectively, of the Outstanding Company Common
      Stock and Outstanding Company Voting Securities immediately prior to such
      reorganization, merger or consolidation, beneficially own, directly or
      indirectly, less than fifty percent (50%) of, respectively, the then outstanding
      shares of common stock and the combined voting power of the then outstanding
      voting securities entitled to vote generally in the election of directors,
      as
      the case may be, of the corporation resulting from such reorganization, merger
      or consolidation in substantially the same proportions as their ownership,
      immediately prior to such reorganization, merger or consolidation of the
      Outstanding Company Common Stock and the Outstanding Company Voting Securities,
      as the case may be; or

     

    (c) Completion
      by the Company of (i) a complete liquidation or dissolution of Company or (ii)
      the sale or other disposition of all or substantially all of the assets of
      the
      Company, other than to a corporation, with respect to which following such
      sale
      or other disposition, more than fifty percent (50%) of, respectively, the then
      outstanding shares of common stock of such corporation and the combined voting
      power of the then outstanding voting securities of such corporation entitled
      to
      vote generally in the election of directors is then beneficially owned, directly
      or indirectly, by all or substantially all of the individuals and entities
      who
      were the beneficial owners, respectively, of the Outstanding Company Common
      Stock and Outstanding Company Voting Securities immediately prior to such sale
      or other disposition in substantially the same proportion as their ownership,
      immediately prior to such sale or other disposition, of the Outstanding Company
      Common Stock and Outstanding Company Voting Securities, as the case may
      be.

     

    
      
        
        

      

      
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    3. Employment
      Period.
      The Company hereby agrees to continue Executive in its employ, and Executive
      hereby agrees to remain in the employ of the Company, during the Employment
      Period under the terms and conditions provided herein.

     

    4. Terms
      of Employment.

     

    (a) Position
      and Duties.
      Executive is appointed to the position of Chief Financial Officer, Secretary,
      Treasurer, and Senior Vice President - Finance of the Company and shall have
      the
      normal duties, responsibilities and authority of these positions, subject to
      the
      power of the Board or the Company’s CEO to limit such duties, responsibilities
      and authority. Executive may perform his duties in his town of residence or
      mutually agreed location or as otherwise mutually agreed by the Company and
      Executive. The Company agrees to make an office available to Executive in the
      city specified by the Executive at a location mutually agreeable to Executive
      and Company. Excluding any periods of vacation and sick leave to which Executive
      is entitled, Executive agrees to devote reasonable attention and time during
      normal business hours to the business and affairs the Company and, to the extent
      necessary to discharge the responsibilities assigned to Executive hereunder,
      to
      use Executive’s reasonable best efforts to perform faithfully and efficiently
      such responsibilities. It shall not be a violation of this Agreement for
      Executive to (A) serve on corporate, civic or charitable boards or committees,
      (B) deliver lectures, fulfill speaking engagements or teach at educational
      institutions and (C) manage personal investments, so long as such activities
      do
      not significantly interfere with the performance of Executive’s responsibilities
      as an employee of the Company in accordance with this Agreement. It is also
      expressly understood and agreed that to the extent that such activities have
      been conducted by Executive prior to the Effective Date, the continued conduct
      of such activities (or the conduct of activities similar in nature and scope
      thereto) subsequent to the Effective Date shall not thereafter be deemed to
      interfere with the performance of Executive’s responsibilities to the
      Company.

     

    (b) Compensation.

     

    (i) Base
      Salary.
      The Company shall pay Executive a base salary at an annual rate of $200,000
      (initially and as adjusted in accordance with the terms of this Agreement,
“Base
      Salary”). Base Salary shall be reviewed at least annually and shall be adjusted
      as agreed between the Board and Executive (in the event no agreement is reached,
      Base Salary shall remain unchanged). Any increase in Base Salary shall not
      serve
      to limit or reduce any other obligation to Executive under this Agreement.
      Base
      Salary shall not be reduced after any such increase including in connection
      with
      Company wide reductions applied to other senior executives of the
      Company.

     

    (ii) Additional
      Compensation.
      In addition to Base Salary, Executive shall be eligible to receive an annual
      bonus based upon the attainment of certain performance goals and objectives
      established by the Board and/or the Compensation Committee established by the
      Board, in accordance with annual objectives, with no less than 2/3 tied to
      objective results (such as monthly recurring revenue and EBITDA),and the
      remaining percentage tied to subjective results (which could include
      departmental management, establishment of a cooperative working environment,
      effort and other factors). The target annual bonus, assuming accomplishment
      of
      one hundred percent (100%) of the target objectives and the wherewithal of
      Company to pay the same is one hundred percent (100%) of Base
      Salary.

     

    
      
        
        

      

      
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    (iii) The
      incentive bonus for 2008 and thereafter will be determined annually by the
      Board
      or by the Compensation Committee, if delegated such task by the Board. There
      will be no cap, with incentive bonus to increase with increased profit
      performance, for over plan achievement. Plan metrics will be set annually and
      agreed to by the CEO. Executive shall be entitled, at Executive’s option, to
      take payment of incentive bonus either one hundred percent (100%) in cash,
      or to
      take a lesser amount of cash (the amount of cash bonus to be paid in such event,
      if any, is the “Retained Sum”) and accept a grant of “European Options” to
      purchase Common Stock of Company pursuant to the “Formula Amount.” The Formula
      Amount will be based upon the amount of the bonus not taken in cash (the
“Non-cash Sum”), whereby Company will determine the ten (10) day average closing
      price of Company’s Common Stock for the last ten (10) trading days immediately
      preceding the date of the announcement of the bonus (the “TDA”), and Executive
      will then be entitled to an option to purchase that number of shares of Common
      Stock equal to the Non-cash Sum divided by one half of the TDA, with the
      purchase price for such shares to be one half of the TDA. The European Option,
      if selected, will be fully vested, but will be exercisable only at any time
      during the calendar year following the year in which the European Option is
      selected, subject to a Change in Control provision which would change the
      exercise period in a manner substantially similar to that set forth in the
      form
      of option agreement attached hereto as Exhibit B with respect to a Change in
      Control. The form and remaining terms of the European Option(s) shall be
      substantially similar to the form and terms attached as Exhibit B, and shall
      be
      in such form as Company in good faith shall submit to Executive. The
      determination by Executive to accept the European Options with respect to a
      particular year must be made within one (1) business day of being informed
      of
      his incentive bonus amount, and absent delivery of notice of election of the
      European Option, the entire bonus shall be payable in cash. By way of example,
      if the TDA was $2.00 per share and the Non-cash Sum elected by Executive was
      $100,000, then the European Options would relate to 100,000 shares of Common
      Stock, purchasable at $1.00 per share.

     

    (iv) Fringe
      Benefits.
      While Executive is employed by the Company under this Agreement, Executive
      shall
      be entitled to participate in all insurance, vacation days and other benefit
      plans or programs as are provided from time to time by the Company to its other
      executives, in accordance with the terms of such plans or programs and the
      Company’s benefits practices then in effect.

     

    (v) Stock
      Options.
      The Company has granted options on December 10, 2007 to Executive to purchase:
      (i) up to 715,000 shares of Common Stock vested as of such date; and (ii) up
      to
      1,000,000 shares of Common Stock vesting subject to designated performance
      criteria as set forth in separate forms of Option Grants; the parties
      acknowledge and agree that the aforesaid grants were made in anticipation of
      this Agreement and in consideration of the undertakings of Executive set forth
      in Section 9 below.

     

    
      
        
        

      

      
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    (c) Expenses.
      The Company shall reimburse Executive for all reasonable and ordinary expenses
      incurred by Executive in the performance of Executive’s duties hereunder
      including expenses for entertainment, travel and similar items that arise
      related to and for promoting the business of the Company; provided, however,
      that Executive shall account to the Company for such expenses in the manner
      customarily prescribed by the Company for its executives.

     

    5. Termination.

     

    (a) Death
      or Disability.
      This Agreement shall terminate automatically upon Executive’s death. If the
      Company determines in good faith that the Disability of Executive has occurred
      (pursuant to the definition of Disability set forth below), it may give to
      Executive written notice of its intention to terminate Executive’s employment
      hereunder. In such event, Executive’s employment with the Company shall
      terminate effective on the 90th day after receipt by Executive of such notice
      given at any time after a period of six consecutive months of Disability and
      while such Disability is continuing (the “Disability Effective Date”), provided
      that, within the ninety (90) days after such receipt, Executive shall not have
      returned to at least eighty percent (80%) of full-time performance of
      Executive’s duties. For purposes of this Agreement, “Disability” means
      disability which, at least six months after its commencement, is determined
      to
      be total and permanent by a physician selected by the Company or its insurers
      and acceptable to Executive or Executive’s legal representative (such agreement
      as to acceptability not to be withheld unreasonably). During such three-month
      period and until the Disability Effective Date, Executive shall be entitled
      to
      all compensation provided for under Section 4 hereof.

     

    (b) Cause.
      The Company may terminate this Agreement and Executive’s employment with the
      Company for Cause. For purposes of this Agreement, “Cause” means: (i) an act or
      acts of personal dishonesty taken by Executive and intended to result in
      substantial personal enrichment of Executive at the expense of the Company,
      (ii)
      repeated violations by Executive of Executive’s obligations under Section 4(a)
      of this Agreement which are demonstrably willful and deliberate on Executive’s
      part and which are not remedied in a reasonable period of time after receipt
      of
      written notice from the Company, or (iii) the conviction of Executive of a
      felony.

     

    (c) Good
      Reason.
      During the Employment Period, Executive’s employment hereunder may be terminated
      by Executive for Good Reason. For purposes of this Agreement, “Good Reason”
means:

     

    (i) the
      assignment to Executive of any duties inconsistent in any respect with
      Executive’s position (including status, offices, titles and reporting
      relationships), authority, duties or responsibilities as contemplated by Section
      4(a) of this Agreement (including, without limitation, failure to comply with
      Section 4(c), or any other action by the Company which results in a diminution
      in such position, authority, duties or responsibilities;

     

    (ii) any
      action by the Company which results in the diminution of Executive’s position,
      authority, duties, or responsibilities or any change whereby Executive is not
      reporting exclusively to the CEO and is a member of the Company’s Executive
      Committee;

     

    
      
        
        

      

      
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    (iii) any
      failure by the Company to comply with any of the material provisions of this
      Agreement;

     

    (iv) the
      Company requiring Executive to be based at any office or location other than
      that described in Section 4(a) hereof, except for travel reasonably required
      in
      the performance of Executive’s responsibilities;

     

    (v) any
      purported termination by the Company of Executive’s employment otherwise than as
      expressly permitted by this Agreement; or

     

    (vi) any
      failure by the Company to comply with and satisfy Sections 4(c) or 11(c) of
      this
      Agreement.

     

    Prior
      to giving a Notice of Termination for Good Reason, Executive shall notify the
      Company within thirty (30) days of action the Company has taken in such thirty
      (30) day period, together with any other similar actions within the prior six
      months, which Executive believes constitutes Good Reason. The Company shall
      have
      thirty (30) days to cure such circumstances, and if not cured to the reasonable
      satisfaction of Executive, then Executive may give such Notice of Termination
      for Good Reason.

     

    (d) Change-in-Control.
      Executive’s employment may be terminated by Executive within six (6) months of a
      Change-in-Control.

     

    (e) Notice
      of Termination.
      Any termination of Executive’s employment hereunder by the Company for Cause or
      by Executive for Good Reason shall be communicated by Notice of Termination
      to
      such other party hereto given in accordance with 13(b) of this Agreement. For
      purposes of this Agreement, a “Notice of Termination” means a written notice
      which (i) indicates the specific termination provision in this Agreement relied
      upon, (ii) sets forth in reasonable detail the facts and circumstances claimed
      to provide a basis for termination of Executive’s employment under the provision
      so indicated and (iii) if the Date of Termination (as defined below) is other
      than the date of receipt of such notice, specifies the termination date (which
      date shall be not more than fifteen (15) days after the giving of such notice).
      Further, a Notice of Termination for Cause is required to include a copy of
      a
      resolution duly adopted by the affirmative vote of not less than three quarters
      (3/4) of the entire membership of the Board (excluding Executive) at a meeting
      of the Board which was called and held for the purpose of considering such
      termination (after reasonable notice to Executive and an opportunity for
      Executive, together with Executive's counsel, to be heard before the Board)
      finding that, in the good faith opinion of the Board, Executive was guilty
      of
      conduct set forth in the definition of Cause herein, and specifying the
      particulars thereof in detail.

     

    (f) Date
      of Termination.
      “Date of Termination” means the date of receipt of the Notice of Termination or
      any later date specified therein, as the case may be; provided, however, that
      (i) if Executive’s employment hereunder is terminated by the Company other than
      for Cause or Disability, the Date of Termination shall be the date on which
      the
      Company notifies Executive of such termination and (ii) if Executive’s
      employment hereunder is terminated by reason of death or Disability, the Date
      of
      Termination shall be the date of death of Executive or the Disability Effective
      Date, as the case may be.

     

    
      
        
        

      

      
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    6. Obligations
      of the Company upon Termination.

     

    (a) Death.
      If Executive’s employment hereunder is terminated by reason of Executive’s
      death, this Agreement shall terminate without further obligations to Executive’s
      legal representatives under this Agreement, other than those obligations accrued
      or earned and vested (if applicable) by Executive as of the Date of Termination,
      including, for this purpose (i) Executive’s Base Salary through the Date of
      Termination at the rate in effect on the Date of Termination disregarding any
      reduction in Base Salary in violation of this Agreement, and (ii) any
      compensation previously deferred by Executive and not yet paid by the Company
      (including accrued interest thereon) and any accrued vacation pay not yet paid
      by the Company (such amounts specified in clauses (i) and (ii) are hereinafter
      referred to as “Accrued Obligations”). All such Accrued Obligations shall be
      paid to Executive’s estate or beneficiary, as applicable, in a lump sum in cash
      within thirty (30) days of the Date of Termination. In addition, if Executive’s
      employment is terminated by reason of Executive’s death, Executive’s estate will
      have one (1) year to exercise any options vested or earned as of the Date of
      Termination and all unvested or otherwise unearned options) will terminate
      on
      the Date of Termination. Anything in this Agreement to the contrary
      notwithstanding, Executive’s family shall be entitled to receive benefits at
      least equal to the most favorable benefits provided by the Company and any
      of
      its subsidiaries to surviving families of employees of the Company and such
      subsidiaries under such plans, programs, practices and policies relating to
      family death benefits, if any, in accordance with the most favorable plans,
      programs, practices and policies of the Company and its subsidiaries in effect
      on the date of Executive’s death with respect to other key employees of the
      Company and its subsidiaries and their families.

     

    (b) Disability.
      If Executive’s employment is terminated by reason of Executive’s Disability,
      this Agreement shall terminate without further obligations to Executive, other
      than those obligations accrued or earned and vested (if applicable) by Executive
      as of the Date of Termination, including for this purpose, all Accrued
      Obligations. All such Accrued Obligations shall be paid to Executive in a lump
      sum in cash within thirty (30) days of the Date of Termination. In addition,
      if
      Executive’s employment is terminated by reason of Executive’s Disability,
      Executive or his personal representative will have one (1) year to exercise
      any
      options vested or earned as of the Date of Termination and all unvested or
      otherwise unearned options will terminate on the Date of Termination. Anything
      in this Agreement to the contrary notwithstanding, Executive shall be entitled
      after the Disability Effective Date to receive disability and other benefits
      at
      least equal to the most favorable of those provided by the Company and its
      subsidiaries to disabled employees and/or their families in accordance with
      such
      plans, programs, practices and policies relating to disability, if any, in
      accordance with the most favorable plans, programs, practices and policies
      of
      the Company and its subsidiaries in effect on or after the Effective Date or,
      if
      more favorable to Executive and/or Executive’s family, as in effect at any time
      thereafter with respect to other key employees of the Company and its
      subsidiaries and their families.

     

    
      
        
        

      

      
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    (c) Cause.
      If Executive’s employment shall be terminated for Cause, this Agreement shall
      terminate without further obligations to Executive other than those obligations
      accrued or earned and vested (if applicable) by Executive as of the Date of
      Termination, including for this purpose all Accrued Obligations, including
      any
      vested Employee options. All such Accrued Obligations shall be paid to Executive
      in a lump sum in cash within thirty (30) days of the Date of Termination.
      Notwithstanding anything herein to the contrary, if Executive’s employment is
      terminated for Cause, Executive will have thirty (30) days to exercise any
      options vested or earned as of the Date of Termination and all unvested or
      otherwise unearned options will terminate on the Date of
      Termination.

     

    (d) Other
      than for Good Reason.
      If Executive terminates employment other than for Good Reason prior to a
      Change-in-Control, this Agreement shall terminate without further obligations
      to
      Executive, other than those obligations accrued or earned and vested (if
      applicable) by Executive through the Date of Termination, including for this
      purpose, all Accrued Obligations. All such Accrued Obligations shall be paid
      to
      Executive in a lump sum in cash within thirty (30) days of the Date of
      Termination. Notwithstanding anything herein to the contrary, if Executive’s
      employment is terminated for other than Good Reason by Executive, Executive
      will
      have one (1) year to exercise any options vested or earned as of the Date of
      Termination and all unvested or otherwise unearned options will terminate on
      the
      Date of Termination.

     

    (e) Good
      Reason or Other than for Cause.
      If the Company shall terminate Executive’s employment hereunder other than for
      Cause or if Executive shall terminate his employment hereunder for Good
      Reason:

     

    (i) the
      Company shall pay to Executive in a lump sum in cash within thirty (30) days
      (or
      such longer period necessary for the release referred to in Section 9(f) to
      become irrevocable) after the Date of Termination all such Accrued Obligations;
      

     

    (ii) the
      Company shall, for a period of one (1) year after the Date of Termination
      continue to pay the Base Salary and benefits to Executive and/or Executive’s
      family at least equal to those which would have been provided to them in
      accordance with the plans, programs, practices and policies described in Section
      4(b)(iii) including health insurance and life insurance, in accordance with
      the
      most favorable plans, practices, programs or policies of the Company and its
      subsidiaries in effect on the Date of Termination; provided that the Company
      shall not be required to provide a benefit or benefits under this Section (other
      than continuation of Base Salary) to the extent Executive is reemployed during
      such one year period and such subsequent employer provides a comparable benefit
      or benefits; and

     

    (f) Good
      Reason - Change-in-Control.
      If Executive shall terminate his employment within six (6) months of a
      Change-in-Control:

     

    (i) if
      the termination is accompanied by any element of Good Cause set forth in Section
      5(c )(i) - (vi) also being present, the Company shall pay to Executive in a
      lump
      sum in cash within thirty (30) days (or such longer period necessary for the
      release referred to in Section 9(f) to become irrevocable) after the Date of
      Termination all such Accrued Obligations plus three times (3x) less $1.00 of
      an
      amount equal to Executive’s average base salary and incentive payments paid to
      the Executive in the prior three years or such lesser period of time that
      Executive has been employed by the Company; in the event such termination is
      not
      accompanied by Good Cause then the Executive shall be paid the same amount
      immediately set forth above but the multiplier in the prior sentence shall
      be
      one and one-half times (1.5x), not three (3x) times; and

     

    
      
        
        

      

      
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    (g) Change-in-Control.
      In addition to the vesting of Executive’s options provided elsewhere in this
      Agreement, Executive’s unvested options shall become vested as follows. With
      regard to Employee options granted to Executive pursuant to Section 4(b)(iv)
      after the date hereof, one hundred percent (100%) of such options shall vest
      immediately prior to the completion of a Change-in-Control, unless at the time
      of such Change-in-Control transaction, the unvested options are substituted
      or
      continued by the acquirer, regardless of whether Executive’s employment is
      terminated.

     

    7. Non-Exclusivity
      of Rights.
      Nothing in this Agreement shall prevent or limit Executive’s continuing or
      future participation in any benefit, bonus, incentive or other plans, programs,
      policies or practices, provided by Company, the Company or any of their
      respective subsidiaries and for which Executive may qualify, nor shall anything
      herein limit or otherwise affect such rights as Executive may have under any
      stock option, restricted stock or other agreements with Company, the Company
      or
      any of their respective subsidiaries. Amounts which are vested benefits or
      which
      Executive is otherwise entitled to receive under any plan, policy, practice
      or
      program of Company, the Company or any of their respective subsidiaries at
      or
      subsequent to the Date of Termination shall be payable in accordance with such
      plan, policy practice or program.

     

    8. Full
      Settlement.
      The Company’s obligation to make the payments provided for in this Agreement and
      otherwise to perform its obligations hereunder shall not be affected by any
      set-off, counterclaim, recoupment, defense or other claim, right or action
      which
      the Company may have against Executive or others. In no event shall Executive
      be
      obligated to seek other employment or take any other action by way of mitigation
      of the amounts payable to Executive under any of the provisions of this
      Agreement. 

     

    9. Certain
      Covenants of Executive.

     

    (a) As
      used in Section 9 and Section 10, the Company shall include the Company and
      each
      corporation, partnership, or other entity that controls the Company, is
      controlled by the Company, or is under common control with the Company (in
      each
      case “control” meaning the direct or indirect ownership of fifty percent (50%)
      or more of all outstanding equity interests).

     

    (b) While
      Executive is employed by the Company and, following the termination of
      Executive’s employment for any reason, until the first anniversary of the Date
      of Termination, Executive will not, directly or indirectly:

     

    (i) employ
      or attempt to employ any director, officer, or employee of the Company, or
      otherwise interfere with or disrupt any employment relationship (contractual
      or
      other) of the Company;

     

    
      
        
        

      

      
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    (ii) solicit,
      request, advise, or induce any present or potential customer (defined by those
      companies from which the Company has either solicited business or have prepared
      marketing proposals for the solicitation of business within the past twelve
      (12)
      months prior the Date of Termination), supplier, or other business contact
      of
      the Company to cancel, curtail, or otherwise change its relationship with the
      Company; 

     

    (iii) publicly
      criticize or disparage in any manner or by any means the Company or its
      management, policies, operations, products, services, practices, or personnel;
      or 

     

    (iv) take
      any action that would violate the terms of this Section 9(b)(iv). Executive
      acknowledges that the covenants set forth in this Section 9(b)(iv) are
      reasonable in scope and essential to the preservation of the Business of Company
      (as defined herein). Executive also acknowledges that the enforcement of the
      covenants set forth in this Section 9(b)(iv) will not preclude Executive from
      being gainfully employed in such manner and to the extent as to provide a
      standard of living for himself, the members of his family and the others
      dependent upon him of at least the level to which he and they have become
      accustomed and may expect. In addition, Executive acknowledges that Company
      has
      obtained an advantage over its competitors as a result of its name, location
      and
      reputation that is characterized by near permanent relationships with vendors,
      customers, principals and other contacts that it has developed at great expense.
      Furthermore, Executive acknowledges that competition by him following the
      termination or expiration of his employment would impair the operation of
      Company beyond that which would arise from the competition of an unrelated
      third
      party with similar skills. Executive hereby agrees that he shall not, during
      his
      employment and for a period of one (1) year after the end of his employment,
      directly or indirectly, engage in or become directly or indirectly interested
      in
      any proprietorship, partnership, firm, trust, company, limited liability company
      or other entity, other than Company (whether as owner, partner, trustee,
      beneficiary, stockholder, member, officer, director, employee, independent
      contractor, agent, servant, consultant, manager, lessor, lessee or otherwise)
      that:

     

    (1) competes
      with Company in the Business of Company; or 

     

    (2) competes
      at a material level with Company in the Restricted Territory (as defined
      herein), other than acquiring an ownership interest in a company listed on
      a
      recognized stock exchange in an amount which does not exceed five percent (5%)
      of the outstanding stock of such corporation. For purposes of this Agreement,
      the term “Business of Company” shall include all business activities and
      ventures related to the business of providing of any of the
      following:

     

    a. provision
      of telecom network integration services, including the sale or lease of
      broadband circuits for the transmission of data or voice; 

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    b. cost
      reduction solutions for companies aimed at taking cost out of their network
      usage or procurement, including network optimization and least cost
      routing;

     

    c. licensing
      or sale of software intended to effect the foregoing:

     

    i. all
      other
      businesses in which Company or any of its subsidiaries is engaged in as of
      the
      date of termination of Executive’s employment; and

     

    ii. the
      term “Restricted Territory” means any state in the United States of America.
      Executive specifically acknowledges that the Business of Company is not
      naturally restricted by any geographic boundaries.

     

    Notwithstanding
      anything to the contrary contained in this Agreement, in order to enforce the
      terms of the noncompetition covenant contained in this Section 9(b)(iv), Company
      must make payment to Executive no later than thirty (30) days following the
      termination of his employment with the Company or any of its subsidiaries of
      the
      full amount of severance payments that would otherwise be payable to him under
      this Agreement as if he had been terminated without “cause,” if it wishes to
      enforce the noncompetition provisions called for hereunder. For the avoidance
      of
      doubt, the payment called for in the preceding sentence will not be in addition
      to the severance otherwise payable hereunder, if any. Notwithstanding anything
      to the contrary contained in this paragraph, should Executive’s employment have
      been terminated for “cause” as defined in this Agreement, then the Company shall
      be entitled to enforce the noncompetition covenant contained in this Section
      9(b)(iv) provided that it makes payment to Executive no later than thirty (30)
      days following the termination of his employment with the Company or any of
      its
      subsidiaries of one half the amount of severance payments that would otherwise
      be payable to him under this Agreement as if he had been terminated without
      “cause.”

     

    (c) Executive
      hereby acknowledges and agrees that all non-public information and data of
      the
      Company, including without limitation that related to product and service
      formulation, customers, pricing, sales, and financial results (collectively,
      “Trade Secrets”) are of substantial value to the Company, provide it with a
      substantial competitive advantage in its business, and are and have been
      maintained in the strictest confidence as trade secrets. Except as permitted
      by
      the Board, or as appropriate in the performance of Executive’s duties in the
      normal course of business, Executive shall not at any time disclose or make
      accessible to anyone any Trade Secrets.

     

    (d) Executive
      acknowledges and agrees that this Section 9 and each provision hereof are
      reasonable and necessary to ensure that the Company receives the expected
      benefits of this Agreement and that violation of this Section will harm the
      Company to such an extent that monetary damages alone would be an inadequate
      remedy. Consequently, in the event of any violation or threatened violation
      by
      Executive of any provision of this Section, the Company shall be entitled to
      an
      injunction (in addition to all other remedies it may have) restraining Executive
      from committing or continuing such violation. If any provision or application
      of
      this Section is held unlawful or unenforceable in any respect, this Section
      shall be revised or applied in a manner that renders it lawful and enforceable
      to the fullest extent possible.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    (e) Upon
      termination of Executive’s employment for any reason, Executive covenants to
      resign from the Board effective no later than the Termination Date.

     

    (f) Prior
      to the payment of any amount pursuant to Section 6, Executive shall have
      executed the release in the form set forth as Exhibit A (with the blanks
      appropriately filled in) and such release shall have become irrevocable. The
      release shall exclude those claims related to Executive’s vested options,
      Accrued Obligations, the obligations of paragraph 9(g), and any rights of
      indemnification from third party claims that existed prior to Executive’s
      termination.

     

    (g) Upon
      termination of the Executive’s employment for any reason, the Company shall not
      publicly criticize or disparage in any manner or by any means the Executive.
      Upon termination of the Executive’s employment for any reason, Executive shall
      not publicly criticize or disparage in any manner or by any means the
      Company.

     

    10. Creations.

     

    (a) Executive
      hereby transfers and assigns to the Company (or its designee) all right, title,
      and interest of Executive in and to every idea, concept, invention, and
      improvement (whether patented or not) conceived by Executive and all copyrighted
      or copyrightable matter created by Executive during the Term hereof that relates
      to the Company’s business (collectively, “Creations”). Executive shall
      communicate promptly and disclose to the Company, in such form as the Company
      may request, all information, details, and data pertaining to each Creation.
      Every copyrightable Creation, regardless of whether copyright protection is
      sought or preserved by the Company, shall be “work for hire” as defined in 17
      U.S.C. Sec. 101 and the Company shall own all rights in and to such matter
      throughout the world, without the payment of any royalty or other consideration
      to Executive or anyone claiming through Executive.

     

    (b) All
      right, title, and interest in and to any and all trademarks, trade names,
      service marks, and logos adopted, used, or considered for use by the Company
      during Executive’s employment (whether or not developed by Executive) to
      identify the Company’s products or services (collectively, the “Marks”) and all
      other materials, ideas, or other property conceived, created, developed,
      adopted, or improved by Executive solely or jointly during Executive’s
      employment by the Company and relating to its business, shall be owned
      exclusively by the Company. Executive shall not have, and will not claim to
      have, any right, title, or interest of any kind in or to the Marks or such
      other
      property.

     

    (c) Executive
      shall execute and deliver to the Company such formal transfers and assignments
      and such other documents as the Company may request to permit the Company (or
      its designee) to file and prosecute such registration applications and other
      documents it deems useful to protect its rights under this Agreement. Any idea,
      copyrightable matter, or other property relating to the Company’s business and
      disclosed by Executive prior to the first anniversary of the Date of Termination
      shall be deemed to be governed hereby unless proved by Executive to have been
      first conceived and made after the Date of Termination.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    (d) Executive
      acknowledges and understands that this Agreement does not apply to any invention
      that qualifies fully under the provisions of the Illinois Employee Patent Act,
      765 ILCS 1060 seq. (i.e., an invention for which no Company equipment, supplies,
      facility, or trade secret information was used and which was developed entirely
      on the employee's own time and (1) does not relate to Company business and
      (2)
      does not result from any work performed by Executive for the
      Company).

     

    11. Successors.

     

    (a) This
      Agreement is personal to Executive and without the prior written consent of
      the
      Company shall not be assignable by Executive otherwise than by will or the
      laws
      of descent and distribution. This Agreement shall inure to the benefit of and
      be
      enforceable by Executive’s legal representatives.

     

    (b) This
      Agreement shall inure to the benefit of and be binding upon Company and the
      Company and their respective successors and assigns.

     

    (c) The
      Company will require any successor (whether direct or indirect, by purchase,
      merger, consolidation or otherwise) to all or substantially all of its business
      and/or assets 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. As used in this Agreement, “Company”
shall mean 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.

     

    12. Arbitration.
      Any controversy or claim arising out of or relating to this Agreement, or the
      breach of this Agreement, other than claims for specific performance or
      injunctive relief pursuant to Section 9, shall be settled by arbitration before
      one arbitrator conducted in Chicago, Illinois, and judgment upon any award
      rendered by the arbitrator may be entered in any Illinois state or United States
      federal court sitting in Chicago, Illinois.

     

    13. Tax
      and Legal Considerations.

     

    (a) Golden
      Parachute Gross-Up Payment.
      In the event it shall be determined that any payments due under this Agreement
      would be subject to an excise tax imposed by Section 4999 of the Code, or any
      interest or penalties (an “Excise Tax”), then Executive shall be entitled to
      receive an additional payment (a “Gross-Up Payment”) in an amount such that
      after payment by Executive of Federal and state income tax and Excise Tax
      imposed upon the Gross-Up Payment, Executive will have received an amount of
      the
      Gross-Up Payment equal to the Excise Tax imposed upon such payments. All
      determinations required to be made under this Section 13(a), including whether
      and when a Gross-Up Payment is required and the amount of such Gross-Up Payment
      and the assumptions to be utilized in arriving at such determination, shall
      be
      made by the public accounting firm that is retained by the Company as of the
      date immediately prior to a Change-in-Control of the Corporation (the
“Accounting Firm”) which shall provide detailed supporting calculations both to
      the Corporation and Executive. Any Gross-Up Payment, as determined pursuant
      to
      this Section 13(a), shall be paid by the Company to Executive within ten (10)
      days of the determination. The determination by the Accounting Firm shall be
      binding upon the Corporation and Executive.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    (b) Deferred
      Compensation Restrictions.
      It is intended that any amounts payable under this Agreement shall comply with
      the provisions of Section 409A of the Internal Revenue Code of 1986, as amended
      (the “Code”), and the treasury regulations promulgated thereunder. To avoid any
      penalties or excise tax on Executive as imposed by Section 409A, required
      payments to Executive upon termination of his employment shall be distributed
      on
      the later of (i) the dates specified in this Agreement or (ii) six (6) months
      after Executive’s Date of Termination. The term “termination of employment” and
      other similar terms used in this Agreement shall be construed to have the same
      meaning as is given to the term “Separation from Service” in Section 409A.
      Executive and the Company agree to cooperate to make such other amendments
      to
      the terms of this Agreement as may be necessary to avoid the imposition of
      penalties and additional taxes under Section 409A of the Code.

     

    14. Miscellaneous.

     

    (a) This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of Illinois, without reference to principles of conflict of laws. The
      captions of this Agreement are not part of the provisions hereof and shall
      have
      no force or effect. This Agreement may not be amended or modified otherwise
      than
      by a written agreement executed by the parties hereto or their respective
      successors and legal representatives.

     

    (b) All
      notices and other communications hereunder shall be in writing and shall be
      given by hand delivery to the other party or by registered or certified mail,
      return receipt requested, postage prepaid, addressed as follows:

     

    
      	
              If
                to Executive:

            	
              At
                Executive’s home address on the Company’s books and
                records

            
	 	 
	 	
              with
                a copy to:

            
	 	 
	 	
              ____________________________

              ____________________________

              ____________________________

              ____________________________

            
	 	 
	
              If
                to the Company:

            	
              Capital
                Growth Systems, Inc.

              500
                West Madison Street - Suite 2060

              Chicago,
                Illinois 60661

            
	 	 
	 	
              with
                a copy to:

            
	 	 
	 	
              Mitchell
                D. Goldsmith Esq.

              Shefsky
                & Froelich Ltd.

              111
                East Wacker Drive - Suite 2800

              Chicago,
                IL 60601

            

    

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    
 

    or
      to such other address as either party shall have furnished to the other in
      writing in accordance herewith. Notice and communications shall be effective
      when actually received by the addressees.

     

    (c) The
      invalidity or unenforceability of any provision of this Agreement shall not
      affect the validity or enforceability of any other provision of this
      Agreement.

     

    (d) The
      Company may withhold from any amounts payable under this Agreement such Federal,
      state or local taxes as shall be required to be withheld pursuant to any
      applicable law or regulation.

     

    (e) Executive’s
      failure to insist upon strict compliance with any provision hereof shall not
      be
      deemed to be a waiver of such provision or any other provision
      thereof.

     

    (f) Words
      or terms used in this Agreement that connote the masculine gender are deemed
      to
      apply equally to female executives. 

     

    (g) If
      any legal action or other proceeding is brought for the enforcement of this
      Agreement, or because of an alleged dispute, breach, default or
      misrepresentation in connection with any of the provisions of this Agreement,
      the prevailing party shall be entitled to recover reasonable attorneys' fees,
      court costs and out-of-pocket expenses incurred in connection with that action
      or proceeding, in additional to any other relief which it or they may be
      entitled. 

     

    (h) Failure
      by either party to insist upon strict compliance with any of the terms,
      covenants or conditions hereof shall not be deemed a waiver of such term,
      covenant or condition, nor shall any waiver or relinquishment of any right
      or
      remedy hereunder at any time be deemed a waiver or relinquishment of such right
      or remedy.

     

    (i) If
      any provision of this Agreement, as applied to any party or to any circumstance,
      shall be found by a court to be void, invalid or unenforceable, the same shall
      in no way affect any other provision of this Agreement or the application of
      any
      such provision in any other circumstance, or the validity or enforceability
      of
      this Agreement.

     

    (j) This
      Agreement shall inure to the benefit of and be binding upon the Company and
      its
      successors and assigns. Except as expressly provided herein, the rights,
      benefits and obligations of Executive under this Agreement are personal to
      him,
      and any voluntary or involuntary alienation, assignment or transfer by Executive
      shall be null and void.

     

    (k) This
      Agreement contains the entire understanding of the parties hereto relating
      to
      the subject matter contained herein and supersedes all prior and collateral
      agreements, understandings, statements and negotiations of the parties. Each
      party acknowledges that no representations, inducements, promises or agreements,
      oral or written, with reference to the subject matter hereof have been made
      other than as expressly set forth herein. This Agreement may not be modified
      or
      rescinded except by a written agreement signed by both parties. 

     

    [REMAINDER
      OF PAGE IS BLANK]

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, Executive has hereunto set his hand and, pursuant to the
      authorization from its Board of Directors, the Company has caused those present
      to be executed in its name on its behalf, all as of the day and year first
      above
      written.

     

    
      	
              COMPANY:

            	 	
              EXECUTIVE:

            
	 	 	 
	
              CAPITAL
                GROWTH SYSTEMS, INC.

            	 	 
	 	 	 
	
              By:

            	 	 	
              JIM
                MCDEVITT

            
	
              Its:

            	 	 	 
	 	 	 
	
              Date:

            	 	 	 

    

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    

    EXHIBIT
      A

     

    RELEASE
      AGREEMENT

     

    CAPITAL
      GROWTH SYSTEMS, INC.
      (the “Company”) and JIM
      MCDEVITT
      (“Executive”) agree as follows:

     

    WHEREAS,
      the Company and Executive are parties to that certain Employment Agreement
      dated
      as of January 1, 2008 (the “Employment Agreement”); and

     

    WHEREAS,
      the Company and Executive have agreed to terminate the Employment Agreement
      releasing each other from all further obligations except those specifically
      identified therein as surviving such termination.

     

    THEREFORE,
      in consideration of the covenants and obligations set forth below, the Company
      and Executive agree as follows:

     

    1. Separation
      from Employment.
      Executive’s employment with the Company will terminate on
      _________________.

     

    2. Severance.
      The Company agrees to pay Executive severance benefits in accordance with the
      terms of the Employment Agreement, as may be amended from time to time,
      commencing as soon as practicable following the expiration of the rescission
      period referred to below.

     

    3. Release
      of Claims.
      After adequate opportunity to review this Release Agreement and to obtain the
      advice of legal counsel of Executive’s choice, Executive hereby releases,
      acquits and forever discharges the Company, and all of its directors, officers,
      agents, employees, affiliates, parents, successors and assigns, from any and
      all
      liability whatsoever arising from or relating to (i) his employment by the
      Company, (ii) his separation from employment with the Company, or (iii) any
      other claim or liability, excluding liabilities from claims arising under this
      Release Agreement or under Sections 6(d) and 9 of the Employment Agreement,
      including those claims related to Executive’s vested Employee options, Accrued
      Obligations, the obligations in paragraph 9(g) of the Employment Agreement,
      and
      any rights of indemnification from third party claims that existed prior to
      Executive’s termination. Subject to the foregoing, by this Release, Executive
      gives up any right to make a claim, bring a lawsuit, or otherwise seek money
      damages or court orders as a result of his employment by the Company, his
      separation from employment with the Company, or otherwise. Executive hereby
      acknowledges and intends that this Release applies to any statutory or common
      law claims which have arisen through the date of Executive’s signature below,
      including but not limited to, any and all claims of unpaid wages, stock options,
      wrongful termination, defamation, intentional or negligent infliction of
      emotional distress, negligence, breach of contract, fraud, and any claims under
      the Age Discrimination in Employment Act (ADEA), Title VII of the Civil Rights
      Act of 1964, the Americans with Disabilities Act, the Illinois Human Rights
      Act
      (IHRA), the Family and Medical Leave Act, the Employee Retirement Income
      Security Act, and any other local, state or federal statutes. Executive
      acknowledges that this Release includes all claims Executive is legally
      permitted to release and as such does not apply to any claim for reemployment
      benefits, nor does it preclude Executive from filing a charge of discrimination
      with the state Department of Human Rights or the federal Equal Employment
      Opportunity Commission although Executive would not be able to recover any
      damages if Executive filed such a charge. This Release includes but is not
      limited to all claims relating to Executive’s employment and the separation of
      Executive’s employment. This Release Agreement shall be binding upon Executive
      and upon his heirs, administrators, representatives, executors, successors
      and
      assigns. Notwithstanding anything to the contrary contained herein, in no event
      shall this Release Agreement constitute a release by Executive of his rights
      with respect to accrued benefits to which he would otherwise be entitled under
      any of the Company's employee benefit plans, programs or other employee benefit
      arrangements (excluding any severance plans or arrangements).

     

    
      
        
        

      

      
        A-1

        
          

        

      

      
        
        

      

    

     

    4. Entire
      Agreement.
      This Release Agreement contains the entire agreement between Executive and
      the
      Company with respect to the subject matter hereof. No modification or amendment
      to this Release Agreement shall be valid or binding unless made in writing
      and
      signed by the parties. This Release Agreement will be interpreted under the
      laws
      of Illinois.

     

    5. Notification
      of Rescission Rights.

     

    (a) This
      Release Agreement contains a release of certain legal rights that Executive
      may
      have under the ADEA or the IHRA. Executive should consult with an attorney
      regarding such release and other aspects of this Release Agreement before
      signing.

     

    (b) The
      termination of Executive’s employment by the Company will not be affected by
      Executive’s acceptance or failure to accept this Release Agreement. If Executive
      does not accept the terms hereof, or if Executive revokes his acceptance of
      this
      Release Agreement, the Company will not provide to him the benefits described
      herein. 

     

    (c) Executive
      has twenty-one (21) days to consider whether or not to sign this agreement,
      starting from the date he first receives a copy of this agreement. Executive
      may
      sign this agreement at any time during this twenty-one (21) day
      period.

     

    (d) After
      Executive has accepted this Release Agreement by signing it, he may revoke
      his
      acceptance for a period of fifteen (15) days after the date he signed this
      Release Agreement. This Release Agreement will not be effective until this
      fifteen (15) day revocation period has expired.

     

    (e) If
      Executive wishes to revoke his acceptance of this Release Agreement, he must
      notify the Company in writing within the fifteen (15) day revocation period.
      Such notice must be delivered to the Company in person or mailed by certified
      mail, return receipt requested, addressed to: Capital Growth Systems, Inc.,
      500
      W. Madison Street, Suite 2060, Chicago, Illinois 60661, Attention: Board of
      Directors. If Executive fails to properly deliver or mail such written
      revocation as instructed, the revocation will not be effective.

     

    I
      first received a copy of this Release Agreement on
      _____________________.

     

    
      	
              Date:

            	 	 	
              EXECUTIVE:

            
	 	 	 	 
	 	 	 
	 	 	
              JIM
                MCDEVITT

            

    

     

    
      
        
        

      

      
        A-2

        
          

        

      

      
        
        

      

    

    
 

    I
      agree to accept the terms of this Release Agreement.

     

    
      	
              COMPANY:

            	 	
              EXECUTIVE:

            
	 	 	 
	
              CAPITAL
                GROWTH SYSTEMS, INC.

            	 	 
	 	 	 
	
              By:

            	 	 	
              JIM
                MCDEVITT

            
	
              Its:

            	 	 	 
	 	 	 
	
              Date:

            	 	 	
              Date:

            	 

    

     

    
      
        
        

      

      
        A-3Unassociated Document

    CAPITAL
      GROWTH SYSTEMS, INC.

    2007
      LONG-TERM INCENTIVE PLAN

     

    CAPITAL
      GROWTH SYSTEMS, INC., a Florida corporation (the "Company"), sets forth herein
      the terms of the Capital Growth Systems, Inc. 2007 Long-Term Incentive Plan
      (the
      "Plan") as follows: 

     

    
      	
              1.

            	
              Purpose.

            

    

     

    The
      purpose of the Plan is to aid the Company and its subsidiaries in recruiting
      and
      retaining employees and to motivate such employees and other plan participants
      to exert their best efforts on behalf of the Company and its subsidiaries by
      providing incentives through the granting of stock-based incentive awards.
      The
      Company expects that it will benefit from the stock ownership opportunities
      provided to such participants to encourage alignment of their interest in the
      Company's success with that of other stakeholders. The Plan shall allow eligible
      participants to acquire shares of the Company's Common Stock, $.0001 par value
      ("Shares") either directly through the grant of shares which are restricted
      and
      subject to risk of forfeiture ("Restricted Shares") or through the grant of
      options to purchase Shares ("Options"). Options granted under the Plan may
      be
      nonqualified stock options or may be "incentive stock options" ("ISOs") within
      the meaning of Section 422 of the Internal Revenue Code of 1986, as amended
      from
      time to time (the "Code"), or the corresponding provision of any subsequently
      enacted tax statute. The Plan shall also allow the granting of other stock-based
      awards ("Other Stock-Based Awards" - together with awards of Restricted Shares
      or Options, hereinafter at times collectively referred to as "Awards" and
      individually referred to as an "Award"; the grantee of an Award is hereinafter
      referred to as a "Participant"). Eligibility for Awards may be based on such
      criteria as the Committee deems appropriate, which may be tied to performance
      standards and vesting standards requiring continued performance of services
      to
      the Company over time.

     

    
      	
              2.

            	
              Administration.

            

    

     

    2.1 Committee.

     

    The
      Plan
      shall be administered by the Compensation Committee (the "Committee") of the
      Board of Directors of the Company (the "Board"), or if the Company does not
      have
      a Compensation Committee, then the Plan shall be administered by the Board.
      As
      used herein the term Committee, shall mean either the Committee or the Board,
      as
      applicable.

     

    2.2 Action
      by Committee.

     

    The
      Committee shall have such powers and authorities related to the administration
      of the Plan as are consistent with the Articles of Incorporation and Bylaws
      of
      the Company and applicable law. The Committee shall have the full power and
      authority to take all actions and to make all determinations required or
      permitted under the Plan with respect to any Award granted hereunder. The
      Committee shall have the full power and authority to take all other actions
      and
      determination not inconsistent with the specific terms and provisions of the
      Plan that the Committee deems to be necessary or appropriate to the
      administration of the Plan. The Committee's powers shall include, but not be
      limited to, the power to interpret the Plan and to amend, waive, or extend
      any
      provision or limitation of any Option or the terms and conditions of any grant
      of Restricted Shares or Other Stock-Based Awards, and to approve the forms
      of
      agreement for use under the Plan. The interpretation and construction by the
      Committee of any provision of the Plan, any Option granted hereunder or the
      terms and conditions of any grant of Restricted Shares or Other Stock-Based
      Awards shall be final and conclusive. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    2.3 No
      Liability.

     

    No
      member
      of the Board or of the Committee shall be liable for any action or determination
      made, or any failure to take or make an action or determination, in good faith
      with respect to the Plan. 

     

    2.4 Applicability
      of Rule 16b-3.

     

    Those
      provisions of the Plan that make express reference to Rule 16b-3 shall apply
      only to persons who are required to file reports under Section 16(a) of the
      Securities Exchange Act of 1934, as amended (the "Exchange Act"). 

     

    2.5 Tax
      Withholding.

     

    The
      Company may withhold or require payment from the Participant of any amount
      it
      may determine to be necessary to withhold for federal, state, local, non-U.S.
      income, payroll or other taxes as a result of the exercise, grant or vesting
      of
      an Award. Unless the Committee specifies otherwise, the Participant may elect
      to
      pay a portion or all of such withholding taxes by: (i) delivery in Shares;
      (ii)
      having the Company withhold Shares with a Fair Market Value or cash equal to
      the
      amount of such taxes that would have otherwise been payable by the Participant;
      or (iii) paying cash.

     

    2.6 Nontransferability
      of Awards/Beneficiaries.

     

    No
      Award
      or interest in an Award may be sold, assigned, pledged (as collateral for a
      loan
      or as security for the performance of an obligation or for any other purpose)
      or
      transferred by the Participant or made subject to attachment or similar
      proceedings otherwise than by will or by the applicable laws of descent and
      distribution, except to the extent a Participant designates one or more
      beneficiaries on a Company-approved form who may exercise the Award or receive
      payment under the Award after the Participant's death. During a Participant's
      lifetime, an Award may be exercised only by the Participant. Notwithstanding
      the
      foregoing and to the extent permitted by Section 422 of the Code or any
      successor thereto, the Committee, in its sole discretion, may permit a
      Participant to assign or transfer an Award; provided, however, that any Award
      so
      assigned or transferred shall be subject to all the terms and conditions of
      the
      Plan and the agreement evidencing the Award.

     

    A
      Participant may designate a beneficiary to succeed to the Participant's Awards
      under the Plan in the event of the Participant's death by filing a beneficiary
      form with the Company and, upon the death of the Participant, such beneficiary
      shall succeed to the rights of the Participant to the extent permitted by law
      and the terms of this Plan and the applicable agreement. In the absence of
      a
      validly designated beneficiary who is living at the time of the Participant's
      death, the Participant's executor or administrator of the Participant's estate
      shall succeed to the Awards, which shall be transferable by will or pursuant
      to
      laws of descent and distribution.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    
      	
              3.

            	
              Common
                Stock Covered by the Plan.

            

    

     

    The
      number of Shares with respect to which Options, Restricted Shares and other
      Stock-Based Awards may be granted under the Plan shall not exceed five million
      (5,000,000), subject to adjustment as provided in Section
      12.
      There
      shall be no limit to the number of Shares with respect to which Awards may
      be
      granted to a participant during any calendar year. The Shares to be issued
      as
      Restricted Shares or upon exercise of Options may be authorized, but unissued
      or
      reacquired Shares. If any Option expires, terminates or is terminated for any
      reason prior to exercise in full, or any Restricted Shares are forfeited, or
      any
      Other Stock-Based Award is terminated or forfeited, the Shares that were subject
      to the unexercised portion of such Option or the Restricted Shares or Other
      Stock-Based Awards that are forfeited or terminated (collectively, "Lapsed
      Shares"), as the case may be, shall be available immediately for future grants
      of Awards under the Plan. To the extent an Award under this Plan of a Lapsed
      Share reduces the 5,000,000 Shares available under the Plan, when it becomes
      a
      Lapsed Share, this then replenishes by a like amount the number of Shares
      available for issuance under the Plan as if the Lapsed Share had not been
      previously granted. To the extent any Award is exercised in whole or part
      through a cashless exercise pursuant to Section 6.8(c) hereof, that portion
      of
      the Award used to fund the cashless exercise shall not be available for future
      issuance pursuant to this Plan.

     

    
      	
              4.

            	
              Eligibility.

            

    

     

    Awards
      may be granted under the Plan to an employee, director or officer of the Company
      or any subsidiary who is selected by the Committee to participate in the Plan.
      An Award may also be granted to any consultant or advisor who renders bona
      fide
      services to the Company or a subsidiary, provided that consultants or advisors
      are eligible only if (i) they are natural persons; and (ii) the services
      provided to the Company are not in connection with the offer or sale of
      securities in a capital-raising transaction, and do not directly or indirectly
      promote or maintain a market for the Company’s securities . Except where the
      context otherwise requires, references in this Plan to "employment" and related
      terms shall apply to services in any such capacity. Individuals who have been
      granted Options are referred to as "Optionees." An individual may hold more
      than
      one Option, subject to such restrictions as are provided herein, and may also
      hold more than one grant of Restricted Shares of Other Stock-Based Awards.
      All
      references to an "employee" of the Company shall include employees of any direct
      or indirect subsidiary of the Company, 50% or more of which is beneficially
      owned by the Company.

     

    The
      Committee may also grant Awards in substitution for options or other equity
      interests held by individuals who become employees of the Company or of a
      subsidiary as a result of the Company's acquiring or merging with the
      individual's employer or acquiring its assets or to persons who were employees
      of directors of the previous employer and received an option in that capacity
      even if they do not become employees of the Company. In addition, the Committee
      may provide for the Plan's assumption of options granted outside the Plan to
      persons who would have been eligible under the terms of the Plan to receive
      a
      grant. If necessary to conform the Awards to the interests for which they are
      substitutes, the Committee may grant substitute Awards under terms and
      conditions that vary from those the Plan otherwise requires. 

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
      	
              5.

            	
              Effective
                Date and Term.

            

    

     

    5.1 Effective
      Date.

     

    The
      Plan
      will become effective as of on the date of adoption by the Board (the "Effective
      Date"). 

     

    5.2 Term.

     

    The
      Plan
      shall terminate on the tenth anniversary of the Effective Date, unless
      previously terminated under Section
      11.
      All
      Awards granted prior to termination of the Plan shall continue in full force
      and
      effect following the termination of the Plan, subject to the terms and
      conditions upon which they were granted.

     

    
      	
              6.

            	
              Terms
                and Conditions of Stock
                Options.

            

    

     

    6.1 Grant
      of Options.

     

    Subject
      to the terms and conditions of the Plan, the Committee may, at any time and
      from
      time to time prior to the termination of the Plan, grant to such eligible
      Participants as the Committee may determine, Options to purchase such number
      of
      Shares on such terms and conditions as the Committee may determine, including
      any terms or conditions that may be necessary to qualify such Options as ISOs.
      The Committee may grant ISOs only to employees of the Company and any
      subsidiaries.

     

    6.2 Stock
      Options under Code Section 422.

     

    The
      date
      as of which the Committee approves the grant of an Option shall be considered
      the date on which such Option is granted. Neither the Optionee nor any person
      entitled to exercise any rights hereunder shall have any of the rights of a
      stockholder with respect to the Shares subject to an Option except to the extent
      that the certificates for such Shares have been issued upon the exercise of
      the
      Option. 

     

    6.3 Limitation
      on Incentive Stock Options.

     

    An
      Option
      granted to an employee shall constitute an ISO only to the extent that the
      aggregate fair market value (determined at the time the Option is granted)
      of
      the Stock with respect to which ISOs are exercisable for the first time by
      the
      Optionee during any calendar year (under the Plan and all other plans of the
      Company and any subsidiaries, within the meaning of Code Section 422(d)), does
      not exceed one hundred thousand dollars ($100,000). This limitation shall be
      applied by taking Options into account in the order in which such Options were
      granted. 

     

    6.4 Option
      Agreements.

     

    All
      Options granted to Optionees pursuant to the Plan shall be evidenced by written
      agreements in such form or forms as the Committee shall from time to time
      determine. Option agreements may be amended by the Committee from time to time
      and need not contain uniform provisions. 

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    6.5 Option
      Price.

     

    The
      purchase price of each Share subject to an Option issued under this Section
      6
      shall be
      fixed by the Committee. In the case of an Option not intended to constitute
      an
      ISO, the option price shall be not less than the par value of the Shares covered
      by the Option. In the case of an Option that is intended to be an ISO, the
      option price of each Share purchasable pursuant to the Option shall be not
      less
      than the greater of the par value of the Shares or 100% of the Fair Market
      Value
      (as defined below) of a Share covered by the Option on the date the Option
      is
      granted; provided, however, that in the event the employee would otherwise
      be
      ineligible to receive an ISO by reason of the provisions of Code Sections
      422(b)(6) and 424(d) (relating to owners of more than 10% of the Company's
      common stock), the option price of each Share purchasable pursuant to an Option
      that is intended to be an ISO shall be not less than the greater of par value
      or
      one hundred and ten percent (110%) of the Fair Market Value of a Share covered
      by the Option at the time such Option is granted. 

     

    "Fair
      Market Value" for purposes of this Plan shall mean, in the event that the
      Company's common stock is listed on an established national or regional stock
      exchange, or is publicly traded on an established securities market or on OTCBB,
      the closing price of the stock on such exchange or in such market (the highest
      such closing price if there is more than one such exchange or market on the
      date
      the Option is granted), or, if no sale of stock has been made on such day,
      on
      the last preceding day on which any such sale shall have been made. In the
      event
      that the Shares are not listed, quoted or publicly traded or, if their price
      cannot be determined despite their being listed, quoted or publicly traded,
      "Fair Market Value" shall be determined by the Committee, in its sole
      discretion.

     

    6.6 Term.

     

    Each
      Option granted to an Optionee under the Plan shall terminate and all rights
      to
      purchase Shares thereunder shall cease upon the expiration of five (5) years
      from the date such Option is granted, or on such prior date or later date (but
      in no event later than ten (10) years from the date such Option is granted)
      as
      may be fixed by the Committee and stated in the option agreement relating to
      such Option; provided, however, that in the event the employee would otherwise
      be ineligible to receive an ISO by reason of the provisions of Code Sections
      422(b)(6) and 424(d) (relating to owners of more than 10% of the Company's
      common stock), an Option granted to such employee that is intended to be an
      ISO
      shall in no event be exercisable after the expiration of five (5) years from
      the
      date it is granted. 

     

    6.7 Option
      Period and Limitations on Exercise.

     

    Each
      Option granted under the Plan to an Optionee shall be exercisable in whole
      or in
      part at any time and from time to time over a period commencing on or after
      the
      date of grant of the Option and ending upon expiration or termination of the
      Option, as the Committee shall determine and set forth in the option agreement.
      Without limiting the foregoing, the Committee, subject to the terms and
      conditions of the Plan, may in its sole discretion provide that the Option
      granted to an Optionee may not be exercised in whole or in part for any period
      or periods of time during which such Option is outstanding as the Committee
      shall determine and set forth in the option agreement. Any such limitation
      on
      the exercise of an Option may be rescinded, modified or waived by the Committee,
      in its sole discretion, at any time and from time to time after the date of
      grant of such Option. 

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    6.8 Exercise.

     

    (a) Only
      the
      Optionee receiving an Option (or, in the event of the Optionee's legal
      incapacity or incompetency, the participant's guardian or legal representative,
      and in the case of the Optionee's death, the participant's estate) may exercise
      the Option. 

     

    (b) An
      Option
      that is exercisable hereunder may be exercised by delivery to the Company on
      any
      business day, at its principal office addressed to the attention of the
      Corporate Secretary, of written notice of exercise. Such notice shall specify
      the number of Shares for which the Option is being exercised and shall be
      accompanied by payment in full of the option price of the Shares for which
      the
      Option is being exercised, unless otherwise determined by the Committee, in
      its
      sole discretion. 

     

    (c) Payment
      of the option price for the Shares purchased pursuant to the exercise of an
      Option shall be made, as determined by the Committee and set forth in the option
      agreement, as follows: 

     

    (i) in
      cash
      or by certified check payable to the order of the Company;

     

    (ii) in
      Shares
      having a Fair Market Value equal to the aggregate exercise price for the Shares
      being purchased pursuant to the Option and satisfying such other requirements
      as
      may be imposed by the Committee; provided, that such Shares were purchased
      on
      the open market or have been held by the participant for no less than six months
      (or such other period as established from time to time by the Committee in
      order
      to avoid adverse accounting treatment under generally accepted accounting
      principles);

     

    (iii) partly
      in
      cash and partly in such Shares;

     

    (iv) if
      there
      is a public market for the Shares at such time, through the delivery of
      irrevocable instructions to a broker to sell Shares obtained upon the exercise
      of the Option and to deliver promptly to the Company an amount out of the
      proceeds of such sale equal to the aggregate exercise price for the Shares
      being
      purchased pursuant to the Option; 

     

    (v)
       by
      cashless exercise through the surrender of options to purchase that number
      of
      Shares having a fair market value in excess of exercise price equal to the
      number of Shares to be purchased through the cashless exercise.; or

     

    (vi) such
      other method as determined by the Committee, in its sole discretion.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    (d) Notwithstanding
      the foregoing, the Committee may, in its discretion, impose and set forth in
      the
      option agreement such limitations or prohibitions on the methods of exercise
      as
      the Committee deems appropriate. Promptly after the exercise of an Option and
      the payment in full of the option price of the Shares covered thereby, the
      individual exercising the Option shall be entitled to the issuance of a stock
      certificate or certificates evidencing such individual's ownership of such
      Shares. An individual holding or exercising an Option shall have none of the
      rights of a stockholder until the Shares covered thereby are fully paid and
      issued to such individual and, except as provided in Section
      12,
      no
      adjustment shall be made for dividends or other rights for which the record
      date
      is prior to the date of such issuance. 

     

    (e) If
      the
      Optionee is not vested as to his or her entire Option at the time of termination
      of employment of the Optionee pursuant to the terms of the relevant option
      agreement, then the Shares covered by the unvested portion of the Option shall
      revert to the Plan. If, after termination, the Optionee does not exercise his
      or
      her Option within the time specified in the relevant option agreement, the
      Option shall terminate, and the Shares covered by such Option shall revert
      to
      the Plan.

     

    
      	
              7.

            	
              Restricted
                Shares.

            

    

     

    7.1 Grant
      of Restricted Shares.

     

    Subject
      to the terms and conditions of the Plan, the Committee may, at any time and
      from
      time to time prior to the termination of the Plan, grant Restricted Shares
      to
      such eligible Participants as the Committee may determine subject to such
      conditions under which they may be forfeited and such other terms and conditions
      it deems appropriate.

     

    7.2 Transfer
      Restrictions.

     

    Shares
      of
      Restricted Stock may not be sold, assigned, transferred, pledged or otherwise
      encumbered, except as provided in the Plan or the applicable Award agreement.
      Shares of Restricted Stock shall be registered in the name of the Participant
      and held by the Company. After the lapse of the restrictions applicable to
      such
      Shares of Restricted Stock, the Company shall deliver such Shares to the
      Participant or the Participant's legal representative.

     

    7.3 Dividends.

     

    Dividends
      or dividend equivalents paid on any Shares of Restricted Stock may be paid
      directly to the Participant, withheld by the Company subject to vesting of
      the
      Restricted Stock pursuant to the terms of the applicable Award agreement, or
      may
      be reinvested in additional Shares of Restricted Stock, as determined by the
      Committee in its sole discretion.

     

    7.4 Rights
      of Unvested Restricted Shares.

     

    Until
      vesting conditions of a Restricted Stock grant agreement are met, the holder
      thereof shall have no rights of a shareholder thereof and shall not have the
      right to receive dividends thereon or to vote said Restricted Shares, unless
      otherwise provided in the Restricted Stock agreement.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    7.5 Legends.

     

    Restricted
      Shares issued under the Plan shall be subject to such restrictions on trading,
      including appropriate legending of certificates to that effect as the Company,
      in its discretion, shall determine necessary to satisfy applicable legal
      requirements and obligations.

     

    7.6 Representations
      of Grantee.

     

    Each
      recipient of an Award of Restricted Stock under the Plan shall, at the time
      of
      the Award, as a condition to such Award, enter into a Restricted Stock grant
      agreement in a form approved by the Committee.

     

    
      	
              8.

            	
              Other
                Stock-Based Awards.

            

    

     

    The
      Committee, in its sole discretion, may grant Other-Stock Based Awards, including
      grants of Shares and awards that are valued in whole or in part by reference
      to,
      or are otherwise based on, Shares or on the Fair Market Value thereof. Such
      Other Stock-Based Awards shall be in such form, and dependent on such
      conditions, as the Committee shall determine, including, without limitation,
      the
      right to receive, or vest with respect to, one or more Shares (or the equivalent
      cash value of such Shares) upon the completion of a specified period of service,
      the occurrence of an event and/or the attainment of performance objectives.
      Other Stock-Based Awards may be granted alone or in addition to any other Awards
      granted under the Plan. Subject to the provisions of the Plan, the Committee
      shall determine the number of Shares to be awarded to a Participant under (or
      otherwise related to) such Other Stock-Based Awards; whether such Other
      Stock-Based Awards shall be settled in cash, Shares or a combination of cash
      and
      Shares; and all other terms and conditions of such Awards (including, without
      limitation, the vesting provisions thereof and provisions ensuring that all
      Shares so awarded and issued shall be fully paid and non- assessable). Unless
      the Other Stock-Based Award agreement specifically states that the Other
      Stock-Based Award is subject to the terms and conditions of this Plan, it will
      not be considered an Award granted pursuant to this Plan.

     

    
      	
              9.

            	
              Use
                of Proceeds.

            

    

     

    The
      proceeds received by the Company from the sale of Shares pursuant to Options
      shall constitute general funds of the Company. 

     

    
      	
              10.

            	
              Requirements
                of Law.

            

    

     

    10.1 General.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    The
      Corporation shall not be required to sell or issue any Award (or any Shares
      or
      Option underlying the Award) if such sale or issuance would constitute a
      violation by the individual exercising the Award or by the Company of any
      provision of any law or regulation of any governmental authority, including,
      without limitation, any federal or state securities laws or regulations or
      the
      Company's Articles of Incorporation. If at any time the Company shall determine,
      in its discretion, that the listing, inclusion, registration or qualification
      of
      any Award (or any Shares or Option underlying the Award) upon any securities
      exchange or under any state or federal law, or the consent of any government
      regulatory body, is necessary or desirable as a condition of, or in connection
      with, such sale or issuance, the Award (or any Shares or Option underlying
      the
      Award) may not be issued or exercised in whole or in part, unless such listing,
      registration, inclusion, qualification, consent or approval shall have been
      effected or obtained free of any conditions not acceptable to the Company,
      and
      any delay caused thereby shall in no way affect the date of termination of
      or
      the restriction period of such Award (or any Shares or Option underlying the
      Award). Specifically in connection with the Securities Act of 1933, as amended
      (the "Securities Act") with respect to the issuance of Shares, upon exercise
      of
      any Award, unless a registration statement under the Securities Act is in effect
      with respect to such Shares, the Company shall not be required to sell or issue
      such Shares unless the Company has received evidence satisfactory to the Company
      that the Participant may acquire such Shares pursuant to an exemption from
      registration under the Securities Act. Any determination in this connection
      by
      the Committee shall be final and conclusive. The Corporation may, but shall
      in
      no event be obligated to, register any securities covered hereby pursuant to
      the
      Securities Act. The Corporation shall not be obligated to take any affirmative
      action in order to cause the exercise of an Award (or any Shares or Option
      underlying the Award) or the issuance of Shares pursuant thereto to comply
      with
      any law or regulation of any governmental authority. As to any jurisdiction
      that
      expressly imposes the requirement that an Award shall not be exercisable unless
      and until the Shares covered by such Award are registered or are subject to
      an
      available exemption from registration, the exercise of such Award (under
      circumstances in which the laws of such jurisdiction apply) shall be deemed
      conditioned upon the effectiveness of such registration or the availability
      of
      such an exemption.

     

    10.2 SEC
      Rule 16b-3.

     

    The
      Plan
      is intended to qualify for the exemption provided by Rule 16b-3 under the
      Exchange Act. To the extent any provision of the Plan or action by the Committee
      does not comply with the requirements of Rule 16b-3, it shall be deemed
      inoperative, to the extent permitted by law and deemed advisable by the
      Committee, and shall not affect the validity of the Plan. In the event Rule
      16b-3 is revised or replaced, the Board may exercise discretion to modify the
      Plan in any respect necessary to satisfy the requirements of the revised
      exemption or its replacement. 

     

    
      	
              11.

            	
              Amendment
                and Termination.

            

    

     

    The
      Board
      may, from time to time, amend the Plan or any provision thereof in such respects
      as the Board may deem advisable, provided that no amendment to the Plan may
      be
      made without stockholder approval if such amendment would: (i) increase the
      number of Shares available for issuance under the Plan, other than as a result
      of the application of the anti-dilution adjustments as provided for in
Section
      12;
      (ii)
      cause the Plan to fail to comply with Rule 16b-3 under the Securities Exchange
      Act of 1934, or any successor rule; or (iii) materially modify the eligibility
      requirements for participation in the Plan. Any amendment or termination of
      the
      Plan shall not adversely affect any Award previously granted. The Board may,
      at
      any time, terminate the Plan.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	
              12.

            	
              Anti-dilution
                Adjustments.

            

    

     

    12.1 Adjustments
      to Plan or Number or Class of Shares or Restricted Shares Issuable under the
      Plan.

     

    Notwithstanding
      any other provision of the Plan, the Committee may, at any time, make or provide
      for such adjustments to the Plan or to the number and class of Shares issuable
      thereunder upon the exercise of Options or as Restricted Shares or as Other
      Stock-Based Awards as it shall deem appropriate to prevent dilution or
      enlargement of rights, including adjustments in the event of changes in the
      outstanding Shares by reason of stock dividends, split-ups, recapitalizations,
      mergers, consolidations, combinations or exchanges of shares, separations,
      reorganizations, liquidations and similar transactions. Any such determination
      by the Committee shall be conclusive. Any fractional shares resulting from
      such
      adjustments shall be eliminated.

     

    12.2 Adjustments
      to Terms of Awards Previously Granted.

     

    If
      the
      number of outstanding Shares is increased or decreased or changed into or
      exchanged for a different number or kind of shares or other securities of the
      Company by reason of any recapitalization, reclassification, stock split,
      combination of shares, exchange of shares, stock dividend or other distribution
      payable in capital stock, or other increase or decrease in such shares effected
      without receipt of consideration by the Company, occurring after the Effective
      Date, a proportionate and appropriate adjustment shall be made by the Company
      in
      the number and kind of Shares for which Awards are outstanding, so that the
      proportionate interest of the Participant immediately following such event
      shall, to the extent practicable, be the same as immediately prior to such
      event. Any such adjustment in outstanding Awards shall not change the aggregate
      option price payable with respect to Shares subject to the unexercised portion
      of the Award outstanding but shall include a corresponding proportionate
      adjustment in the option or exercise price per Share. Similar proportionate
      adjustments for events referenced in this Section
      12.2
      shall be
      made as necessary, in the sole discretion of the Committee, with respect to
      Other Stock-Based Awards.

     

    
      	
              13.

            	
              Change
                in Control.

            

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    Notwithstanding
      anything contained in this Plan to the contrary, unless otherwise provided
      in
      the applicable Award agreement at the time of grant, in the event of a Change
      in
      Control, the following shall occur as of the date of termination of employment
      of any employee of the Company "without cause" (as that term is defined in
      the
      agreement governing the Award(s) to such employee) during the one year period
      following the effective date of such Change in Control with respect to any
      and
      all Awards outstanding as of the date of termination of employment: (i) any
      and
      all Options granted hereunder which would vest with the passage of time were
      the
      Participant to continue as an employee for the applicable period and the
      "Current Year's Percentage" (as hereinafter defined) of any Options which are
      tied to performance standards that could possibly be achieved during the
      calendar year in which the Participant's employment has been terminated, shall
      vest in full and become immediately exercisable, and shall remain exercisable
      throughout their entire term; (ii) any restrictions imposed on Restricted Shares
      shall lapse with respect to Restricted Shares which would vest with the passage
      of time were the Participant to continue as an employee for the applicable
      period and with respect to the "Current Year's Percentage" (as hereinafter
      defined) of any Options which are tied to performance standards that could
      possibly be achieved during the calendar year in which the Participant's
      employment has been terminated; and (iii) the maximum payout opportunities
      attainable under all Other Stock-Based Awards which would vest with the passage
      of time were the Participant to continue as an employee for the applicable
      period and the "Current Year's Percentage of any Restricted Shares which are
      tied to performance standards that could possibly be achieved during the
      calendar year in which the Participant's employment has been terminated, shall
      be deemed to have been fully earned for the calendar year in which the
      Participant's employment has been terminated. Such Awards shall be paid in
      cash,
      or in the sole discretion of the Committee in Shares to Participants within
      thirty (30) days following the effective date of the termination of employment
      of the employee without cause during the one year period following a Change
      in
      Control, with any such Shares valued at the Fair Market Value as of the
      effective date of the termination of employment without cause. The "Current
      Year's Percentage" of a performance based Award for purposes of this
      Section 13 shall be that percentage of the performance based Award that
      would have been met for the calendar year in question based upon the product
      of
      (i) the percentage of calendar quarters completed for the year in which the
      employee is terminated without cause, multiplied by (ii) the performance based
      Award that the employee would have earned had the entire four calendar quarters
      of the Company's performance and the employee's performance for such year
      equaled the average quarterly performance for all calendar quarters completed
      prior to termination of the employee's employment for the year in question.
      If
      termination of employment occurs before March 31 of a year, then no
      acceleration of vesting of a performance based Award would be available for
      that
      year in the event of a Change in Control. The provisions of subsections (i),
      (ii) and (iii) immediately above shall not apply if employment of an employee
      of
      the Company is not terminated "without cause" during the one-year period
      following a Change in Control.

     

    For
      purposes of this Section
      13,
      "Change
      in Control" means:

     

    (a) any
      individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2)
      of the Securities Exchange Act of 1984, as amended, or any successor thereto)
      (a
      "Person") becomes the beneficial owner (within the meaning of Rule 13d-3
      promulgated under the Act) of 50% or more of either (A) the then outstanding
      Shares (the "Outstanding Company Common Stock") or (B) the combined voting
      power
      of the then outstanding voting securities of the Company entitled to vote
      generally in the election of directors (the "Outstanding Company Voting
      Securities"); provided, however, that, for purposes of this clause (a), the
      following acquisitions shall not constitute a Change in Control: (1) any
      acquisition directly from the Company and approval by the Board, (2) any
      acquisition by the Company or any of its subsidiaries, (3) any acquisition
      by
      any employee benefit plan (or related trust) sponsored or maintained by the
      Company or any of its subsidiaries, (4) any acquisition by an underwriter
      temporarily holding securities pursuant to an offering of such securities or
      (5)
      any acquisition pursuant to a transaction that complies with clauses (b)(A)
      and
      (B) below; or

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    (b) consummation
      of a reorganization, merger, statutory share exchange or consolidation (or
      similar corporate transaction) involving the Company or any of its subsidiaries,
      a sale or other disposition of all or substantially all of the assets of the
      Company, or the acquisition of assets or stock of another entity (a "Business
      Combination"), in each case, unless, immediately following such Business
      Combination, (A) substantially all of the individuals and entities who were
      the
      beneficial owners, respectively, of the Outstanding Company Common Stock and
      the
      Outstanding Company Voting Securities immediately prior to such Business
      Combination beneficially own, directly or indirectly, 50% or more of,
      respectively, the then outstanding Shares and the total voting power of (1)
      the
      corporation resulting from such Business Combination (the "Surviving
      Corporation") or (2) if applicable, the ultimate parent corporation that
      directly or indirectly has beneficial ownership of 80% or more of the voting
      securities eligible to elect directors of the Surviving Corporation (the "Parent
      Corporation"), in substantially the same proportion as their ownership,
      immediately prior to the Business Combination, of the Outstanding Company Common
      Stock and the Outstanding Company Voting Securities, as the case may be and
      (B)
      no Person (other than any employee benefit plan (or related trust) sponsored
      or
      maintained by the Surviving Corporation or the Parent Corporation), is or
      becomes the beneficial owner, directly or indirectly, of 50% or more of the
      outstanding Shares of common stock and the total voting power of the outstanding
      voting securities eligible to elect directors of the Parent Corporation (or,
      if
      there is no Parent Corporation, the Surviving Corporation); or

     

    (c) Approval
      by the shareholders of the Company of a complete liquidation or dissolution
      of
      the Company.

     

    Notwithstanding
      the foregoing provisions of this definition, a Change in Control shall not
      be
      deemed to occur with respect to the Participant if the acquisition of the 50%
      or
      greater interest referred to in clause (a) is by a group, acting in concert,
      that includes the participant or if at least 40% of the then outstanding common
      stock or combined voting power of the then outstanding voting securities (or
      voting equity interests) of the Surviving Corporation or, if applicable, the
      Parent Corporation shall be beneficially owned, directly or indirectly,
      immediately after a Business Combination by a group, acting in concert, that
      includes the participant.

     

    
      	
              14.

            	
              Further
                Adjustment of Awards.

            

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    Subject
      to the above provisions, the Committee shall have the discretion, exercisable
      at
      any time before a sale, merger, consolidation, reorganization, liquidation,
      dissolution or Change in Control transaction to take such further action as
      it
      determines to be necessary or advisable with respect to Awards. Such authorized
      action may include (but shall not be limited to) establishing, amending or
      waiving the type, terms, conditions or duration of, or restrictions on, Awards
      so as to provide for earlier, later, extended or additional time for exercise,
      lifting of restrictions and other modifications, and the Committee may take
      such
      actions with respect to all Participants, to certain categories of Participants
      or only to individual Participants. The Committee may take such action before
      or
      after granting Awards to which the action relates and before or after any public
      announcement with respect to such sale, merger, consolidation, reorganization,
      liquidation, dissolution or Change in Control that is the reason for such
      action. Notwithstanding anything to the contrary contained herein, no action
      to
      be taken pursuant to this Section 14 shall be taken to the extent that it
      has the effect of amending this Plan in a manner that would otherwise require
      shareholder approval pursuant to applicable Securities and Exchange Commission
      laws or regulations, but for the terms of this Section 14.

     

    
      	
              15.

            	
              Disclaimer
                of Rights.

            

    

     

    No
      provision in the Plan or any Option, Restricted Shares or Other Stock-Based
      Award agreement entered into pursuant to the Plan shall be construed to confer
      upon any individual the right to remain in the service of the Company or any
      subsidiary, or to interfere in any way with the right and authority of the
      Company or any subsidiary either to increase or decrease the compensation of
      any
      individual at any time, or to terminate any employment or other relationship
      between any individual and the Company or any subsidiary. The obligation of
      the
      Company to pay any benefits pursuant to the Plan shall be interpreted as a
      contractual obligation to pay only those amounts described herein, in the manner
      and under the conditions prescribed herein. The Plan shall in no way be
      interpreted to require the Company to transfer any amounts to a third party
      trustee or otherwise hold any amounts in trust or escrow for payment to any
      participant or beneficiary under the terms of the Plan.

     

    
      	
              16.

            	
              No
                Trust or Fund.

            

    

     

    The
      Plan
      is intended to constitute an "unfunded" plan. Nothing contained herein shall
      require the Company to segregate any monies, other property, or Shares, or
      to
      create any trusts, or to make any special deposits for any immediate or deferred
      amounts payable to any Participant, and no Participant shall have any rights
      that are greater than those of a general unsecured creditor of the
      Company.

     

    
      	
              17.

            	
              Nonexclusivity.

            

    

     

    Neither
      the adoption of the Plan nor the submission of the Plan to the stockholders
      of
      the Company for approval shall be construed as creating any limitations upon
      the
      right and authority of the Board to adopt such other incentive compensation
      arrangements (which arrangements may be applicable either generally to a class
      or classes of individuals or specifically to a particular individual or
      individuals) as the Board in its discretion determines desirable.

     

    
      	
              18.

            	
              Indemnification.

            

    

     

    To
      the
      extent permitted by applicable law, the Committee and Board shall be indemnified
      and held harmless by the Company against and from any and all loss, cost,
      liability or expense that may be imposed upon or reasonably incurred by the
      Committee or Board in connection with or resulting from any claim, action,
      suit
      or proceeding to which the Committee or Board may be a party or in which the
      Committee or Board may be involved by reason of any action taken or failure
      to
      act under the Plan, and against and from any and all amounts paid by the
      Committee or Board (with the Company's written approval) in the settlement
      thereof, or paid by the Committee or Board in satisfaction of a judgment in
      any
      such action, suit or proceeding except a judgment in favor of the Company;
      subject, however, to the conditions that upon the institution of any claim,
      action, suit or proceeding against the Committee (or Board, as the case may
      be),
      the Committee or Board shall give the Company an opportunity in writing, at
      its
      own expense, to handle and defend the same before the Committee (or Board,
      as
      the case may be) undertakes to handle and defend it on the Committee's or
      Board's own behalf. The foregoing right of indemnification shall not be
      exclusive of any other right to which such persons may be entitled as a matter
      of law, under the Company's Articles of Incorporation, By-Laws, or any
      indemnification agreement with the Company, or otherwise, or any power the
      Company may have to indemnify the Committee or Board or hold the Committee
      or
      Board harmless.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    The
      Committee, the Board and each officer and participant shall be fully justified
      in reasonably relying or acting upon any information furnished in connection
      with the administration of the Plan by the Company or any employee. In no event
      shall any persons who are or were members of the Committee or Board, or an
      officer or employee of the Company, be liable for any determination made or
      other action taken or any omission to act in reliance upon any such information,
      or for any action (including furnishing of information) taken or any failure
      to
      act, if in good faith.

     

    
      	
              19.

            	
              Severability.

            

    

     

    In
      the
      event that any provision of the Plan shall be held illegal or invalid for any
      reason, such illegality or invalidity shall not affect the remaining parts
      of
      the Plan, and the Plan shall be construed and enforced as if the illegal or
      invalid provision had not been included.

     

    
      	
              20.

            	
              Governing
                Law.

            

    

     

    To
      the
      extent not preempted by federal law, the Plan and all option and restricted
      stock agreements hereunder shall be construed in accordance with and governed
      by
      the laws of the State of Florida applicable to contracts made and to be
      performed entirely within the State. 

     

    
      
        
        

      

      
        14

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