Document:

Unassociated Document

    Exhibit
      10.1

    

    SECOND
      LOAN MODIFICATION AGREEMENT

     

    This
      Second Loan Modification Agreement (this “Loan Modification Agreement”) is
      entered into as of November 27, 2006, by and between SILICON
      VALLEY BANK,
      a
      California corporation, with its principal place of business at 3003 Tasman
      Drive, Santa Clara, California 95054, and with a loan production office located
      at One Newton Executive Park, Suite 200, 2221 Washington Street, Newton,
      Massachusetts 02462 (“Bank”) and DATAWATCH
      CORPORATION,
      a
      Delaware corporation, and DATAWATCH
      TECHNOLOGIES CORPORATION,
      a
      Delaware corporation, each with its chief executive office located at 271 Mill
      Road, Quorum Office Park, Chelmsford, Massachusetts 01824-4105 (individually,
      collectively, jointly and severally, “Borrower”).

     

    1. 
DESCRIPTION
      OF EXISTING INDEBTEDNESS AND OBLIGATIONS.
      Among
      other indebtedness and obligations which may be owing by Borrower to Bank,
      Borrower is indebted to Bank pursuant to a loan arrangement dated as of April
      20, 2006, evidenced by, among other documents, a certain Loan and Security
      Agreement dated as of April 20, 2006, between Borrower and Bank, as amended
      by
      that certain First Loan Modification Agreement dated as of August 2, 2006 (as
      amended, the “Loan Agreement”). Capitalized terms used but not otherwise defined
      herein shall have the same meaning as in the Loan Agreement.

     

    2. 
DESCRIPTION
      OF COLLATERAL.
      Repayment of the Obligations is secured by the Collateral as described in the
      Loan Agreement (together with any other collateral security granted to Bank,
      including, without limitation, the IP Security Agreement, the “Security
      Documents”). 

     

    Hereinafter,
      the Security Documents, together with all other documents evidencing or securing
      the Obligations shall be referred to as the “Existing Loan
      Documents”.

     

    3.             
      DESCRIPTION
      OF CHANGE IN TERMS.

     

    
      	 	
              A.

            	
              Modifications
                to Loan Agreement.

            

    

     

    
      	 	
              1.

            	
              The
                Loan Agreement shall be amended by deleting the following Section
                2.3(a)
                thereof, entitled “Interest Rate,” in its
                entirety:

            

    

     

    
      	 	
              “(a)

            	
              Interest
                Rate.
                Subject to Section 2.3(b), the principal amount of Advances outstanding
                under the Formula Line shall accrue interest at a floating per annum
                rate
                equal to one half of one percentage point (0.5%) above the Prime
                Rate,
                which interest shall be payable monthly in accordance with Section
                2.3(f)
                below. Notwithstanding the foregoing, during the Covenant Suspension
                Period and through the date which is five (5) days after the termination
                of the Covenant Suspension Period, subject to Section 2.3(b), the
                principal amount of Advances outstanding under the Formula Line shall
                accrue interest at a floating per annum rate equal to one and one
                half of
                one percentage point (1.5%) above the Prime Rate, which interest
                shall be
                payable monthly in accordance with Section 2.3(f) below. Subject
                to
                Section 2.3(b), the principal amount of Advances outstanding under
                the
                Non-Formula Line shall accrue interest at a floating per annum rate
                equal
                to one percentage point (1.0%) above the Prime Rate, which interest
                shall
                be payable monthly in accordance with Section 2.3(f) below.”
                

            

    

     

    and
      inserting in lieu thereof the following:

     

    
      	 	
              “(a)

            	
              Interest
                Rate.
                Subject to Section 2.3(b), the principal amount of Advances outstanding
                under the Formula Line shall accrue interest at a floating per annum
                rate
                equal to one half of one percentage point (0.5%) above the Prime
                Rate,
                which interest shall be payable monthly in accordance with Section
                2.3(f)
                below. Notwithstanding the foregoing, subject to Section 2.3(b),
                the
                principal amount of 

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
       

      
        	 	
              	
                Advances
                  outstanding under the Formula Line shall accrue interest at a floating
                  per
                  annum rate equal to (a) from the beginning of the Covenant Suspension
                  Period through the date which is one day prior to the 2006 Closing
                  Date,
                  one and one half of one percentage point (1.5%) above the Prime
                  Rate,
                  which interest shall be payable monthly in accordance with Section
                  2.3(f)
                  below, and (b) from the 2006 Closing Date through the date which
                  is five
                  (5) days after the termination of the Covenant Suspension Period,
                  one
                  percentage point (1.0%) above the Prime Rate, which interest shall
                  be
                  payable monthly in accordance with Section 2.3(f) below. Subject
                  to
                  Section 2.3(b), the principal amount of Advances outstanding under
                  the
                  Non-Formula Line shall accrue interest at a floating per annum
                  rate equal
                  to one percentage point (1.0%) above the Prime Rate, which interest
                  shall
                  be payable monthly in accordance with Section 2.3(f) below.”
                  

              

      

       

    

    
      	 	
              2.

            	
              The
                Loan Agreement shall be amended by deleting the following Section
                6.7(b)
                thereof, in its entirety:

            

    

     

    
      	 	
              “(b)

            	
              Minimum
                Consolidated Cash Flow.
                EBITDA less Capital Expenditures of at least (i) One Dollar ($1.00)
                for
                the three month period ending March 31, 2006, (ii) Two Hundred Fifty
                Thousand Dollars ($250,000.00) for each of the three month periods
                ending
                April 30, 2006, May 31, 2006, and June 30, 2006, (iii) Five Hundred
                Thousand Dollars ($500,000.00) for each of the three month periods
                ending
                July 31, 2006 and August 31, 2006, (iv) One Dollar ($1.00) for each
                of the
                three month periods ending September 30, 2006, October 31, 2006,
                November
                30, 2006, and December 31, 2006, (v) Two Hundred Fifty Thousand Dollars
                ($250,000.00) for each of the three month periods ending January
                31, 2007,
                February 28, 2007, and March 31, 2007, and (vi) Five Hundred Thousand
                Dollars ($500,000.00) for the three month period ending April 30,
                2007,
                and for each of the three month periods ending on last day of each
                month
                thereafter. Notwithstanding the foregoing, Borrower shall not be
                required
                to comply with the financial covenant set forth in this Section 6.7(b)
                for
                the months ending July 31, 2006 and August 31,
                2006.”

            

    

     

    and
      inserting in lieu thereof the following:

     

    
      	 	
              “(b)

            	
              Minimum
                Consolidated Cash Flow.
                EBITDA less Capital Expenditures of at least (i) One Dollar ($1.00)
                for
                the three month period ending March 31, 2006, (ii) Two Hundred Fifty
                Thousand Dollars ($250,000.00) for each of the three month periods
                ending
                April 30, 2006, May 31, 2006, and June 30, 2006, (iii) Five Hundred
                Thousand Dollars ($500,000.00) for each of the three month periods
                ending
                July 31, 2006 and August 31, 2006, (iv) One Dollar ($1.00) for each
                of the
                three month periods ending September 30, 2006, October 31, 2006,
                November
                30, 2006, and December 31, 2006, and (v) Two Hundred Fifty Thousand
                Dollars ($250,000.00) for the three month period ending January 31,
                2007,
                and for each of the three month periods ending on last day of each
                month
                thereafter. Notwithstanding the foregoing, Borrower shall not be
                required
                to comply with the financial covenant set forth in this Section 6.7(b)
                for
                the months ending July 31, 2006, August 31, 2006, October 31, 2006,
                or
                November 30, 2006.”

            

    

     

    
      	 	
              3.

            	
              The
                Loan Agreement shall be amended by deleting the following definition
                in
                Section 13.1 thereof:

            

    

     

    ““Covenant
      Suspension Period” is the period commencing on July 31, 2006 and ending on the
      date on which Bank receives Borrower’s financial reporting pursuant to Section
      6.2 hereof for the month ending September 30, 2006, which financial reporting
      evidences, in Bank’s sole discretion, Borrower’s compliance with the financial
      covenants set forth in Section 6.7 hereof as of the month ending September
      30,
      2006.”

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    and
      inserting in lieu thereof the following: 

     

    ““Covenant
      Suspension Period” is the period commencing on July 31, 2006 and ending on the
      date on which Bank receives Borrower’s financial reporting pursuant to Section
      6.2 hereof for the month ending December 31, 2006, which financial reporting
      evidences, in Bank’s sole discretion, Borrower’s compliance with the financial
      covenants set forth in Section 6.7 hereof as of the month ending December 31,
      2006.”

     

    
      	 	
              4.

            	
              The
                Loan Agreement shall be amended by inserting the following definition,
                in
                alphabetical order, in Section 13.1
                thereof:

            

    

     

    ““2006
      Closing Date”
      is November 27, 2006.”

     

    
      	 	
              5.

            	
              The
                Compliance Certificate appearing as Exhibit
                D
                to
                the Loan Agreement is hereby replaced with the Compliance Certificate
                attached as Exhibit
                A
                hereto.

            

    

     

    
      	 	
              B.

            	
              Waivers.
                

            

    

     

    
      	 	
              1.

            	
              Bank
                hereby waives Borrower’s existing defaults under the Loan Agreement by
                virtue of Borrower’s failure to comply with the financial covenant set
                forth in Section 6.7(b) thereof (Minimum Consolidated Cash Flow)
                as of the
                month ending September 30, 2006. Bank’s waiver of Borrower’s compliance of
                said financial covenant shall apply only to the foregoing specific
                period.

            

    

     

    4. 
FEES.
      Borrower shall pay to Bank a modification fee equal to $5,500.00, which fee
      shall be due on the date hereof and shall be deemed fully earned as of the
      date
      hereof. Borrower shall also reimburse Bank for all legal fees and expenses
      incurred in connection with this amendment to the Existing Loan Documents.
      

     

    5. 
RATIFICATION
      OF INTELLECTUAL PROPERTY SECURITY AGREEMENT.
      Borrower hereby ratifies, confirms and reaffirms, all and singular, the terms
      and conditions of a certain Intellectual Property Security Agreement dated
      as of
      April 20, 2006 between Borrower and Bank (the “IP Security Agreement”), and
      acknowledges, confirms and agrees that the IP Security Agreement contains an
      accurate and complete listing of all Intellectual Property Collateral as defined
      in the IP Security Agreement, and shall remain in full force and effect.

     

    6. 
RATIFICATION
      OF PERFECTION CERTIFICATE.
      Borrower hereby ratifies, confirms and reaffirms, all and singular, the terms
      and disclosures contained in a certain Perfection Certificate dated as of April
      20, 2006 between Borrower and Bank, and acknowledges, confirms and agrees the
      disclosures and information above Borrower provided to Bank in the Perfection
      Certificate has not changed, as of the date hereof. 

     

    7. 
AUTHORIZATION
      TO FILE.
      Borrower hereby authorizes Bank to file UCC financing statements without notice
      to Borrower, with all appropriate jurisdictions, as Bank deems appropriate,
      in
      order to further perfect or protect Bank’s interest in the Collateral, including
      a notice that any disposition of the Collateral, by either the Borrower or
      any
      other Person, shall be deemed to violate the rights of the Bank under the Code.
      

     

    8. 
CONSISTENT
      CHANGES.
      The
      Existing Loan Documents are hereby amended wherever necessary to reflect the
      changes described above.

     

    9. 
RATIFICATION
      OF LOAN DOCUMENTS.
      Borrower hereby ratifies, confirms, and reaffirms all terms and conditions
      of
      all security or other collateral granted to the Bank, and confirms that the
      indebtedness secured thereby includes, without limitation, the
      Obligations.

     

    10.            
      NO
      DEFENSES OF BORROWER.
      Borrower hereby acknowledges and agrees that Borrower has no offsets, defenses,
      claims, or counterclaims against Bank with respect to the Obligations, or
      otherwise, and that if Borrower now has, or ever did have, any offsets,
      defenses, claims, or counterclaims against Bank, whether 

     

    known
      or
      unknown, at law or in equity, all of them are hereby expressly WAIVED and
      Borrower hereby RELEASES Bank from any liability thereunder.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    11. 
CONTINUING
      VALIDITY.
      Borrower understands and agrees that in modifying the existing Obligations,
      Bank
      is relying upon Borrower’s representations, warranties, and agreements, as set
      forth in the Existing Loan Documents. Except as expressly modified pursuant
      to
      this Loan Modification Agreement, the terms of the Existing Loan Documents
      remain unchanged and in full force and effect. Bank’s agreement to modifications
      to the existing Obligations pursuant to this Loan Modification Agreement in
      no
      way shall obligate Bank to make any future modifications to the Obligations.
      Nothing in this Loan Modification Agreement shall constitute a satisfaction
      of
      the Obligations. It is the intention of Bank and Borrower to retain as liable
      parties all makers of Existing Loan Documents, unless the party is expressly
      released by Bank in writing. No maker will be released by virtue of this Loan
      Modification Agreement.

     

    12. 
JURISDICTION/VENUE.
      Borrower accepts for itself and in connection with its properties,
      unconditionally, the exclusive jurisdiction of any state or federal court of
      competent jurisdiction in the Commonwealth of Massachusetts in any action,
      suit,
      or proceeding of any kind against it which arises out of or by reason of this
      Loan Modification Agreement; provided, however, that if for any reason Bank
      cannot avail itself of the courts of the Commonwealth of Massachusetts, then
      venue shall lie in Santa Clara County, California. NOTWITHSTANDING THE
      FOREGOING, THE BANK SHALL HAVE THE RIGHT TO BRING ANY ACTION OR PROCEEDING
      AGAINST THE BORROWER OR ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION
      WHICH THE BANK DEEMS NECESSARY OR APPROPRIATE IN ORDER TO REALIZE ON THE
      COLLATERAL OR TO OTHERWISE ENFORCE THE BANK’S RIGHTS AGAINST THE BORROWER OR ITS
      PROPERTY.

     

    13. 
COUNTERSIGNATURE.
      This
      Loan Modification Agreement shall become effective only when it shall have
      been
      executed by Borrower and Bank.

     

    [The
      remainder of this page is intentionally left blank]

     

     

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    This
      Loan
      Modification Agreement is executed as a sealed instrument under the laws of
      the
      Commonwealth of Massachusetts as of the date first written above.

     

    
      
        	
                BORROWER:

                 

              	 	
                BANK:

                 

              
	
                DATAWATCH
                  CORPORATION

                 

              	 	
                SILICON
                  VALLEY BANK

                 

              
	
                By:   
                     /s/ Robert
                  Hagger                                            

              	 	
                By:      
                  /s/ Michael J.
                  Fell                                           
                  

              
	
                Name:
                   Robert
                  Hagger                                                  
                  

              	 	
                Name: 
                  Michael J.
                  Fell                                                 
                  

              
	
                Title:   
                  President and
                  CEO                                          
                  

              	 	
                Title:   
                  Relationship
                  Manager                                   

              
	 	 	 
	 	 	 
	
                By:     
                  /s/ John
                  Kitchen                                               

              	 	 
	
                Name:
                  John
                  Kitchen                                                     

              	 	 
	
                Title:  
                  Secretary,
                  SVP                                                   
                  

              	 	 
	 	 	 
	 	 	 
	
                DATAWATCH
                  TECHNOLOGIES CORPORATION

                 

              	 	 
	
                By:      
                  /s/ Rene
                  Tenazas                                             
                  

              	 	 
	
                Name: 
                  Rene
                  Tenazas                                                  
                  

              	 	 
	
                Title:   
                  President                                                          
                  

              	 	 
	
                 

                 

              	 	 
	
                By:      
                  /s/ Robert
                  Hagger                                           
                  

              	 	 
	
                Name: 
                  Robert
                  Hagger                                                 
                  

              	 	 
	
                Title:   
                  Director                                                            
                  

              	 	 
	 	 	 

      

    

     

    The
      undersigned, DATAWATCH INTERNATIONAL LIMITED, ratifies, confirms and reaffirms,
      all and singular, the terms and conditions of a certain Deed of Guarantee dated
      July 11, 2006 (the “Guaranty”) and acknowledges, confirms and agrees that the
      Guaranty shall remain in full force and effect and shall in no way be limited
      by
      the execution of this Loan Modification Agreement, or any other documents,
      instruments and/or agreements executed and/or delivered in connection
      herewith.

     

    DATAWATCH
      INTERNATIONAL LIMITED

     

    By:       
      /s/
      Robert Hagger__________________  

    Name:  
      Robert
      Hagger                                               

    Title:    
      Director                                                           
      

     

     

    56120/496

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    EXHIBIT
      A

    COMPLIANCE
      CERTIFICATE

    

    TO: 
SILICON
      VALLEY BANK                                                      Date:____________________________

    FROM:       
      DATAWATCH
      CORPORATION

        
      DATAWATCH TECHNOLOGIES CORPORATION

    

    The
      undersigned authorized officer of DATAWATCH CORPORATION and DATAWATCH
      TECHNOLOGIES CORPORATION (“Borrower”) certifies that under the terms and
      conditions of the Loan and Security Agreement between Borrower and Bank (the
      “Agreement”), (1) Borrower is in complete compliance for the period ending
      _______________ with all required covenants except as noted below, (2) there
      are
      no Events of Default, (3) all representations and warranties in the
      Agreement are true and correct in all material respects on this date except
      as
      noted below; provided, however, that such materiality qualifier shall not be
      applicable to any representations and warranties that already are qualified
      or
      modified by materiality in the text thereof; and provided, further that
      those representations and warranties expressly referring to a specific date
      shall be true, accurate and complete in all material respects as of such
      date,
      (4)
      Borrower, and each of its Subsidiaries, has timely filed all required tax
      returns and reports, and Borrower
      has timely paid all foreign, federal, state and local taxes, assessments,
      deposits and contributions owed by Borrower
      except
      as otherwise permitted pursuant to the terms of Section 5.9 of the Agreement,
      and (5) no Liens have been levied or claims made against Borrower or any of
      its
      Subsidiaries relating to unpaid employee payroll or benefits of which Borrower
      has not previously provided written notification to Bank. Attached are the
      required documents supporting the certification. The undersigned certifies
      that
      these are prepared in accordance with GAAP consistently applied from one period
      to the next except as explained in an accompanying letter or footnotes. The
      undersigned acknowledges that no borrowings may be requested at any time or
      date
      of determination that Borrower is not in compliance with any of the terms of
      the
      Agreement, and that compliance is determined not just at the date this
      certificate is delivered. Capitalized terms used but not otherwise defined
      herein shall have the meanings given them in the Agreement.

     

    
      	
              Please
                indicate compliance status by circling Yes/No under “Complies”
                column.

            
	 
	
              Reporting
                Covenant

            	
              Required

            	
              Complies

            
	 	 	 
	
              Monthly
                financial statements with Compliance
                Certificate

            	
              Monthly
                within 30 days

            	
              Yes
                No

            
	
              Borrowing
                Base Certificate A/R Agings 

            	
              Monthly
                within 30 days

            	
              Yes
                No

            
	
              Form
                10-Q

            	
              Earlier
                of 45 days after Q-end or 5 days after filing with SEC

            	
              Yes
                No

            
	
              Form
                10-K

            	
              Earlier
                of 120 days after FYE or 5 days after filing with SEC

            	
              Yes
                No

            
	
              Projections,
                Operating Budgets, and other financial information

            	
              Annually
                and as requested by Bank

            	
              Yes
                No

            
	
              Audit

            	
              Annually

            	
              Yes
                No

            
	
              The
                following Intellectual Property was registered after the Effective
                Date
                (if no registrations, state “None”)

              ____________________________________________________________________________

            

    

     

     

    
      	
              Financial
                Covenant

            	
              Required

            	
              Actual

            	
              Complies

            
	 	 	 	 
	
              Maintain
                at all times (tested Monthly, on a consolidated basis):

            	 	 	 
	
              Minimum
                Adjusted Quick Ratio*

            	
              1.25:1.0

            	
              _____:1.0

            	
              Yes
                No

            
	
              Minimum
                Consolidated Cash Flow**

            	
              ***

            	
              $__________

            	
              Yes
                No

            
	
              *covenant
                not to be tested for periods ending 7/31/06, and 8/31/06

            	 	 	 
	
              **covenant
                not to be tested for periods ending 7/31/06, 8/31/06, 10/31/06, and
                11/30/06

            	 	 	 
	
              ***see
                Section 6.7 of the Loan and Security Agreement

            	 	 	 

    

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    The
      following financial covenant analyses and information set forth in Schedule
      1
      attached hereto are true and accurate as of the date of this
      Certificate.

    

    The
      following are the exceptions with respect to the certification above: (If no
      exceptions exist, state “No exceptions to note.”)

    

     

      
        

      

    

     

    
      

    

     

      
        

      

    

     

     

    
      	
               

               

              By: 
                __________________________________

              Name:
                ________________________________

              Title:
                _________________________________

            	
              BANK
                USE ONLY

               

              Received
                by: ___________________________

              authorized
                signer

              Date:
                 ________________________________

               

              Verified:
                ______________________________

               authorized
                signer

              Date:
                 ________________________________

               

              Compliance
                Status: 
Yes   
                NoStock for Services Compensation Plan 2006

    STOCK
      FOR SERVICES COMPENSATION PLAN 2006

    

    UraniumCore
      Company

    a
      DELAWARE corporation

    

    The
      Board of Directors
      of
UraniumCore
      Company hereby
      adopts the following plan for compensation of service providers with common
      stock in lieu of cash. This Plan is adopted as of this date of November 1,
      2006.

    

    1. PURPOSE.

    

    The
      purpose of this Plan is to provide incentives to attract, retain and motivate
      eligible persons whose present and potential contributions are important to
      the
      success of the Company, its Parent and Subsidiaries, by offering them an
      opportunity to participate in the Company's future performance through awards
      of
      Options, Restricted Stock and Stock Bonuses. Capitalized terms not defined
      in
      the text are defined in Section 2.

    

    2. DEFINITIONS.

    

    As
      used
      in this Plan, the following terms will have the following meanings:

    

    “AWARD”
means
      any award under this Plan, including any Option, Restricted Stock or Stock
      Bonus.

    

    “AWARD
      AGREEMENT”
means,
      with respect to each Award, the signed written agreement between the Company
      and
      the Participant setting forth the terms and conditions of the
      Award.

    

    “BOARD”
means
      the Board of Directors of the Company.

    

    “CAUSE”
means
      any cause, as defined by applicable law, for the termination of a Participant's
      employment with the Company or a Parent or Subsidiary of the
      Company.

    

    “CODE”
means
      the Internal Revenue Code of 1986, as amended.

    

    “COMPANY”
means
      UraniumCore Company, a Delaware corporation, or any successor
      corporation.

    

    “DISABILITY”
means
      a
      disability, whether temporary or permanent, partial or total, as determined
      by
      the Board.

    

    “EXCHANGE
      ACT”
means
      the Securities Exchange Act of 1934, as amended.

    

    “EXERCISE
      PRICE”
means
      the price at which a holder of an Option may purchase the Shares issuable upon
      exercise of the Option.

    

    “FAIR
      MARKET VALUE”
means,
      as of any date, the value of a share of the Company's Common Stock determined
      as
      follows:

    

    
      	
              (a)

            	
              if
                such Common Stock is publicly traded and is then listed on a national
                securities exchange, its closing price on the date of determination
                on the
                principal national securities exchange on which the Common Stock
                is listed
                or admitted to trading as reported in The Wall Street
                Journal;

            
	
               

            	
               

            
	
              (b)

            	
              if
                such Common Stock is quoted on the NASDAQ National Market, its closing
                price on the NASDAQ National Market on the date of determination
                as
                reported in The Wall Street
                Journal;

            

    

     

     

    
      
         

      

      
        Page
          - 1

        
          

        

      

      
         

      

    

     

     

     

    
      	
               

            	
               

            
	
              (c)

            	
              if
                such Common Stock is publicly traded but is not listed or admitted
                to
                trading on a national securities exchange, the average of the closing
                bid
                and asked prices on the date of determination as reported by Bloomberg,
                L.P.;

            
	
               

            	
               

            
	
              (d)

            	
              in
                the case of an Award made on the Effective Date, the price per share
                at
                which shares of the Company's Common Stock are initially offered
                for sale
                to the public by the Company's underwriters in the initial public
                offering
                of the Company's Common Stock pursuant to a registration statement
                filed
                with the SEC under the Securities Act; or

            
	
               

            	
               

            
	
              (e)

            	
              if
                none of the foregoing is applicable, by the Board in good
                faith.

            

    

    

    “INSIDER”
means
      an officer or director of the Company or any other person whose transactions
      in
      the Company's Common Stock are subject to Section 16 of the Exchange
      Act.

    

    “OPTION”
means
      an award of an option to purchase Shares pursuant to Section 6.

    

    “PARENT”
means
      any corporation (other than the Company) in an unbroken chain of corporations
      ending with the Company if each of such corporations other than the Company
      owns
      stock possessing 50% or more of the total combined voting power of all classes
      of stock in one of the other corporations in such chain.

    

    “PARTICIPANT”
means
      a
      person who receives an Award under this Plan.

    

    “PERFORMANCE
      FACTORS”
means
      the factors selected by the Board, in its sole and absolute discretion, from
      among the following measures to determine whether the performance goals
      applicable to Awards have been satisfied:

    

    
      	
              (a)

            	
              Net
                revenue and/or net revenue growth;

            
	
               

            	
               

            
	
              (b)

            	
              Earnings
                before income taxes and amortization and/or earnings before income
                taxes
                and amortization growth;

            
	
               

            	
               

            
	
              (c)

            	
              Operating
                income and/or operating income growth;

            
	
               

            	
               

            
	
              (d)

            	
              Net
                income and/or net income growth;

            
	
               

            	
               

            
	
              (e)

            	
              Earnings
                per share and/or earnings per share growth;

            
	
               

            	
               

            
	
              (f)

            	
              Total
                stockholder return and/or total stockholder return
                growth;

            
	
               

            	
               

            
	
              (g)

            	
              Return
                on equity;

            
	
               

            	
               

            
	
              (h)

            	
              Operating
                cash flow return on income;

            
	
               

            	
               

            
	
              (i)

            	
              Adjusted
                operating cash flow return on income;

            
	
               

            	
               

            
	
              (j)

            	
              Economic
                value added; and

            
	
               

            	
               

            
	
              (k)

            	
              Individual
                confidential business objectives.

            

    

    

    “PERFORMANCE
      PERIOD”
means
      the period of service determined by the Board, not to exceed five years, during
      which years of service or performance is to be measured for Restricted Stock
      Awards or Stock Bonuses.

    

    “PLAN”
means
      this UraniumCore Company2006-II Employee Stock Incentive Plan, as amended from
      time to time.

     

     

    
      
         

      

      
        Page
          - 2

        
          

        

      

      
         

      

    

    

    “RESTRICTED
      STOCK AWARD”
means
      an award of Shares pursuant to Section 7.

    

    “SEC”
means
      the Securities and Exchange Commission.

    

    “SECURITIES
      ACT”
means
      the Securities Act of 1933, as amended.

    

    “SHARES”
means
      shares of the Company's Common Stock reserved for issuance under this Plan,
      as
      adjusted pursuant to Sections 3 and 19, and any successor security.

    

    “STOCK
      BONUS”
means
      an award of Shares, or cash in lieu of Shares, pursuant to Section
      8.

    

    “SUBSIDIARY”
means
      any corporation (other than the Company) in an unbroken chain of corporations
      beginning with the Company if each of the corporations other than the last
      corporation in the unbroken chain owns stock possessing 50% or more of the
      total
      combined voting power of all classes of stock in one of the other corporations
      in such chain.

    

    “TERMINATION”
or
      “TERMINATED”
means,
      for purposes of this Plan with respect to a Participant, that the Participant
      has for any reason ceased to provide services as an employee, officer, director,
      consultant, independent contractor, or advisor to the Company or a Parent or
      Subsidiary of the Company. An employee will not be deemed to have ceased to
      provide services in the case of (i) sick leave, (ii) military leave, or (iii)
      any other leave of absence approved by the Company, provided that such leave
      is
      for a period of not more than 90 days, unless reemployment upon the expiration
      of such leave is guaranteed by contract or statute or unless provided otherwise
      pursuant to a formal policy adopted from time to time by the Company and issued
      and promulgated to employees in writing. In the case of any employee on an
      approved leave of absence, the Board may make such provisions respecting
      suspension of vesting of the Award while on leave from the employ of the Company
      or a Subsidiary as it may deem appropriate, except that in no event may an
      Option be exercised after the expiration of the term set forth in the Option
      agreement. The Board will have sole discretion to determine whether a
      Participant has ceased to provide services and the effective date on which
      the
      Participant ceased to provide services (the “TERMINATION DATE”).

    

    “UNVESTED
      SHARES”
means
      “Unvested Shares” as defined in the Award Agreement.

    

    “VESTED
      SHARES”
means
      “Vested Shares” as defined in the Award Agreement.

    

    3. SHARES
      SUBJECT TO THE PLAN.

    

    3.1 Number
      of Shares Available.
      Subject
      to Sections 3.2 and 19, the total aggregate number of Shares reserved and
      available for grant and issuance pursuant to this Plan will be 50,000,000 plus
      Shares that are subject to: (a) issuance upon exercise of an Option but cease
      to
      be subject to such Option for any reason other than exercise of such Option;
      (b)
      an Award granted hereunder but forfeited or repurchased by the Company at the
      original issue price; and (c) an Award that otherwise terminates without Shares
      being issued. At all times the Company shall reserve and keep available a
      sufficient number of Shares as shall be required to satisfy the requirements
      of
      all outstanding Options granted under this Plan and all other outstanding but
      unvested Awards granted under this Plan.

    

    3.2 Adjustment
      of Shares.
      In the
      event that the number of outstanding shares is changed by a stock dividend,
      recapitalization, stock split, reverse stock split, subdivision, combination,
      reclassification or similar change in the capital structure of the Company
      without consideration, then (a) the number of Shares reserved for issuance
      under
      this Plan, (b) the Exercise Prices of and number of Shares subject to
      outstanding Options, and (c) the number of Shares subject to other outstanding
      Awards will be proportionately adjusted, subject to any required action by
      the
      Board or the stockholders of the Company and compliance with applicable
      securities laws; provided, however, that fractions of a Share will not be issued
      but will either be replaced by a cash payment equal to the Fair Market Value
      of
      such fraction of a Share or will be rounded up to the nearest whole Share,
      as
      determined by the Board.

    

    
      
         

      

      
        Page
          - 3

        
          

        

      

      
         

      

    

    

    4. ELIGIBILITY.

    

    ISOs
      (as
      defined in Section 6 below) may be granted only to employees (including officers
      and directors who are also employees) of the Company or of a Parent or
      Subsidiary of the Company. All other Awards may be granted to employees,
      officers, directors, consultants, independent contractors and advisors of the
      Company or any Parent or Subsidiary of the Company; provided such consultants,
      contractors and advisors render bona fide services not in connection with the
      offer and sale of securities in a capital-raising transaction.

    

    5. ADMINISTRATION.

    

    5.1 Board
      Authority.
      This
      Plan will be administered by the Board. Subject to the general purposes, terms
      and conditions of this Plan, the Board will have full power to implement and
      carry out this Plan. Without limitation, the Board will have the authority
      to:

    

    
      	
              (a)

            	
              construe
                and interpret this Plan, any Award Agreement and any other agreement
                or
                document executed pursuant to this Plan;

            
	
               

            	
               

            
	
              (b)

            	
              prescribe,
                amend and rescind rules and regulations relating to this Plan or
                any
                Award;

            
	
               

            	
               

            
	
              (c)

            	
              select
                persons to receive Awards;

            
	
               

            	
               

            
	
              (d)

            	
              determine
                the form and terms of Awards;

            
	
               

            	
               

            
	
              (e)

            	
              determine
                the number of Shares or other consideration subject to
                Awards;

            
	
               

            	
               

            
	
              (f)

            	
              determine
                whether Awards will be granted singly, in combination with, in tandem
                with, in replacement of, or as alternatives to, other Awards under
                this
                Plan or any other incentive or compensation plan of the Company or
                any
                Parent or Subsidiary of the Company;

            
	
               

            	
               

            
	
              (g)

            	
              grant
                waivers of Plan or Award conditions;

            
	
               

            	
               

            
	
              (h)

            	
              determine
                the vesting, ability to exercise and payment of Awards;

            
	
               

            	
               

            
	
              (i)

            	
              correct
                any defect, supply any omission or reconcile any inconsistency in
                this
                Plan, any Award or any Award Agreement;

            
	
               

            	
               

            
	
              (j)

            	
              determine
                whether an Award has been earned; and

            
	
               

            	
               

            
	
              (k)

            	
              make
                all other determinations necessary or advisable for the administration
                of
                this Plan.

            

    

    

    5.2 Board
      Discretion.
      Any
      determination made by the Board with respect to any Award will be made at the
      time of grant of the Award or, unless in contravention of any express term
      of
      this Plan or Award, at any later time, and such determination will be final
      and
      binding on the Company and on all persons having an interest in any Award under
      this Plan. The Board may delegate to one or more officers of the Company the
      authority to grant an Award under this Plan to Participants who are not Insiders
      of the Company.

    

    6. OPTIONS.

    

     The
      Board may grant Options to eligible persons and will determine whether such
      Options will be Incentive Stock Options within the meaning of the Code (“ISO”)
      or Nonqualified Stock Options (“NQSO”), the number of Shares subject to the
      Option, the Exercise Price of the Option, the period during which the Option
      may
      be exercised, and all other terms and conditions of the Option, subject to
      the
      following:

    

    6.1 Form
      of Option Grant.
      Each
      Option granted under this Plan will be evidenced by an Award Agreement that
      will
      expressly identify the Option as an ISO or an NQSO (hereinafter referred to
      as
      the “STOCK OPTION AGREEMENT”), and will be in such form and contain such
      provisions (which need not be the same for each Participant) as the Board may
      from time to time approve, and which will comply with and be subject to the
      terms and conditions of this Plan.

     

    
      
         

      

      
        Page
          - 4

        
          

        

      

      
         

      

    

     

    

    6.2 Date
      of Grant.
      The
      date of grant of an Option will be the date on which the Board makes the
      determination to grant such Option, unless otherwise specified by the Board.
      The
      Stock Option Agreement and a copy of this Plan will be delivered to the
      Participant within a reasonable time after the granting of the
      Option.

     

    6.3 Exercise
      Period.
      Options
      may be exercisable within the times or upon the events determined by the Board
      as set forth in the Stock Option Agreement governing such Option; provided,
      however, that no Option will be exercisable after the expiration of ten (10)
      years from the date the Option is granted; and provided further that no ISO
      granted to a person who directly or by attribution owns more than ten percent
      (10%) of the total combined voting power of all classes of stock of the Company
      or of any Parent or Subsidiary of the Company (“TEN PERCENT STOCKHOLDER”) will
      be exercisable after the expiration of five (5) years from the date the ISO
      is
      granted. The Board also may provide for Options to become exercisable at one
      time or from time to time, periodically or otherwise, in such number of Shares
      or percentage of Shares as the Board determines.

    

    6.4 Exercise
      Price.
      The
      Exercise Price of an Option will be determined by the Board when the Option
      is
      granted and may be not less than 85% of the Fair Market Value of the Shares
      on
      the date of grant; provided that: (a) the Exercise Price of an ISO will be
      not
      less than 100% of the Fair Market Value of the Shares on the date of grant;
      and
      (b) the Exercise Price of any ISO granted to a Ten Percent Stockholder will
      not
      be less than 110% of the Fair Market Value of the Shares on the date of grant.
      Payment for the Shares purchased may be made in accordance with Section 9 of
      this Plan.

    

    6.5 Method
      of Exercise.
      Options
      may be exercised only by delivery to the Company of a written stock option
      exercise agreement (the “EXERCISE AGREEMENT”) in a form approved by the Board,
      (which need not be the same for each Participant), stating the number of Shares
      being purchased, the restrictions imposed on the Shares purchased under such
      Exercise Agreement, if any, and such representations and agreements regarding
      Participant's investment intent and access to information and other matters,
      if
      any, as may be required or desirable by the Company to comply with applicable
      securities laws, together with payment in full of the Exercise Price for the
      number of Shares being purchased.

    

    6.6 Termination.
      Notwithstanding the exercise periods set forth in the Stock Option Agreement,
      exercise of an Option will always be subject to the following:

    

    (a) If
      the Participant's service is Terminated for any reason except death or
      Disability, then the Participant may exercise such Participant's Options only
      to
      the extent that such Options would have been exercisable upon the Termination
      Date no later than three (3) months after the Termination Date (or such shorter
      or longer time period not exceeding five (5) years as may be determined by
      the
      Board, with any exercise beyond three (3) months after the Termination Date
      deemed to be an NQSO), but in any event, no later than the expiration date
      of
      the Options.

    

    (b) If
      the Participant's service is Terminated because of Participant's death or
      Disability (or the Participant dies within three (3) months after a Termination
      other than for Cause or because of Participant's Disability), then Participant's
      Options may be exercised only to the extent that such Options would have been
      exercisable by Participant on the Termination Date and must be exercised by
      Participant (or Participant's legal representative or authorized assignee)
      no
      later than twelve (12) months after the Termination Date (or such shorter or
      longer time period not exceeding five (5) years as may be determined by the
      Board, with any such exercise beyond (i) three (3) months after the Termination
      Date when the Termination is for any reason other than the Participant's death
      or Disability, or (ii) twelve (12) months after the Termination Date when the
      Termination is for Participant's death or Disability, deemed to be an NQSO),
      but
      in any event no later than the expiration date of the Options.

     

    (c) Notwithstanding
      the provisions in paragraph 6.6(a) above, if a Participant's service is
      Terminated for Cause, neither the Participant, the Participant's estate nor
      such
      other person who may then hold the Option shall be entitled to exercise any
      Option with respect to any Shares whatsoever, after Termination, whether or
      not
      after Termination the Participant may receive payment from the Company or
      Subsidiary for vacation pay, for services rendered prior to Termination, for
      services rendered for the day on which Termination occurs, for salary in lieu
      of
      notice, or for any other benefits. For the purpose of this paragraph,
      Termination shall be deemed to occur on the date when the Company dispatches
      notice or advice to the Participant that his service is Terminated.

     

    
      
         

      

      
        Page
          - 5

        
          

        

      

      
         

      

    

     

    

    6.7 Limitations
      on Exercise.
      The
      Board may specify a reasonable minimum number of Shares that may be purchased
      on
      any exercise of an Option, provided that such minimum number will not prevent
      Participant from exercising the Option for the full number of Shares for which
      it is then exercisable.

    

    6.8 Limitations
      on ISO.
      The
      aggregate Fair Market Value (determined as of the date of grant) of Shares
      with
      respect to which ISO are exercisable for the first time by a Participant during
      any calendar year (under this Plan or under any other incentive stock option
      plan of the Company, Parent or Subsidiary of the Company) will not exceed
      $100,000. If the Fair Market Value of Shares on the date of grant with respect
      to which ISO are exercisable for the first time by a Participant during any
      calendar year exceeds $100,000, then the Options for the first $100,000 worth
      of
      Shares to become exercisable in such calendar year will be ISO and the Options
      for the amount in excess of $100,000 that become exercisable in that calendar
      year will be NQSOs. In the event that the Code or the regulations promulgated
      thereunder are amended after the Effective Date of this Plan to provide for
      a
      different limit on the Fair Market Value of Shares permitted to be subject
      to
      ISO, such different limit will be automatically incorporated herein and will
      apply to any Options granted after the effective date of such
      amendment.

    

    6.9 Modification,
      Extension or Renewal.
      The
      Board may modify, extend or renew outstanding Options and authorize the grant
      of
      new Options in substitution therefor, provided that any such action may not,
      without the written consent of a Participant, impair any of such Participant's
      rights under any Option previously granted. Any outstanding ISO that is
      modified, extended, renewed or otherwise altered will be treated in accordance
      with Section 424(h) of the Code. The Board may reduce the Exercise Price of
      outstanding Options without the consent of Participants affected by a written
      notice to them; provided, however, that the Exercise Price may not be reduced
      below the minimum Exercise Price that would be permitted under Section 6.4
      of
      this Plan for Options granted on the date the action is taken to reduce the
      Exercise Price.

    

    6.10 No
      Disqualification.
      Notwithstanding any other provision in this Plan, no term of this Plan relating
      to ISO will be interpreted, amended or altered, nor will any discretion or
      authority granted under this Plan be exercised, so as to disqualify this Plan
      under Section 422 of the Code or, without the consent of the Participant
      affected, to disqualify any ISO under Section 422 of the Code.

    

    7. RESTRICTED
      STOCK.

    

    A
      Restricted Stock Award is an offer by the Company to sell to an eligible person
      Shares that are subject to restrictions. The Board will determine to whom an
      offer will be made, the number of Shares the person may purchase, the price
      to
      be paid (the “PURCHASE PRICE”), the restrictions to which the Shares will be
      subject, and all other terms and conditions of the Restricted Stock Award,
      subject to the following:

    

    7.1 Form
      of Restricted Stock Award.
      All
      purchases under a Restricted Stock Award made pursuant to this Plan will be
      evidenced by an Award Agreement (the “RESTRICTED STOCK PURCHASE AGREEMENT”) that
      will be in such form (which need not be the same for each Participant) as the
      Board will from time to time approve, and will comply with and be subject to
      the
      terms and conditions of this Plan. The offer of Restricted Stock will be
      accepted by the Participant's execution and delivery of the Restricted Stock
      Purchase Agreement and full payment for the Shares to the Company within thirty
      (30) days from the date the Restricted Stock Purchase Agreement is delivered
      to
      the person. If such person does not execute and deliver the Restricted Stock
      Purchase Agreement along with full payment for the Shares to the Company within
      thirty (30) days, then the offer will terminate, unless otherwise extended
      by
      the Board.

    

    7.2 Purchase
      Price.
      The
      Purchase Price of Shares sold pursuant to a Restricted Stock Award will be
      determined by the Board on the date the Restricted Stock Award is granted,
      except in the case of a sale to a Ten Percent Stockholder, in which case the
      Purchase Price will be 100% of the Fair Market Value. Payment of the Purchase
      Price must be made in accordance with Section 9 of this Plan.

     

    
      
         

      

      
        Page
          - 6

        
          

        

      

      
         

      

    

     

    

    7.3 Terms
      of Restricted Stock Awards.
      Restricted Stock Awards shall be subject to such restrictions as the Board
      may
      impose. These restrictions may be based upon completion of a specified number
      of
      years of service with the Company or upon completion of the performance goals
      as
      set out in advance in the Participant's individual Restricted Stock Purchase
      Agreement. Restricted Stock Awards may vary from Participant to Participant
      and
      between groups of Participants. Prior to the grant of a Restricted Stock Award,
      the Board shall: (a) determine the nature, length and starting date of any
      Performance Period for the Restricted Stock Award; (b) select from among the
      Performance Factors to be used to measure performance goals, if any; and (c)
      determine the number of Shares that may be awarded to the Participant. Prior
      to
      the payment of any Restricted Stock Award, the Board shall determine the extent
      to which such Restricted Stock Award has been earned. Performance Periods may
      overlap and Participants may participate simultaneously with respect to
      Restricted Stock Awards that are subject to different Performance Periods and
      have different performance goals and other criteria.

    

    7.4 Termination
      During Performance Period.
      If a
      Participant is Terminated during a Performance Period for any reason, then
      such
      Participant will be entitled to payment (whether in Shares, cash or otherwise)
      with respect to the Restricted Stock Award only to the extent earned as of
      the
      date of Termination in accordance with the Restricted Stock Purchase Agreement,
      unless the Board determines otherwise.

    

    8. STOCK
      BONUSES.

    

    8.1 Awards
      of Stock Bonuses.
      A Stock
      Bonus is an award of Shares (which may consist of Restricted Stock) for
      extraordinary services rendered to the Company or any Parent or Subsidiary
      of
      the Company. A Stock Bonus will be awarded pursuant to an Award Agreement (the
      “STOCK BONUS AGREEMENT”) that will be in such form (which need not be the same
      for each Participant) as the Board will from time to time approve, and will
      comply with and be subject to the terms and conditions of this Plan. A Stock
      Bonus may be awarded upon satisfaction of such performance goals as are set
      out
      in advance in the Participant's individual Award Agreement (the “PERFORMANCE
      STOCK BONUS AGREEMENT”) that will be in such form (which need not be the same
      for each Participant) as the Board will from time to time approve, and will
      comply with and be subject to the terms and conditions of this Plan. Stock
      Bonuses may vary from Participant to Participant and between groups of
      Participants, and may be based upon the achievement of the Company, Parent
      or
      Subsidiary and/or individual performance factors or upon such other criteria
      as
      the Board may determine.

    

    8.2 Terms
      of Stock Bonuses.
      The
      Board will determine the number of Shares to be awarded to the Participant.
      If
      the Stock Bonus is being earned upon the satisfaction of performance goals
      pursuant to a Performance Stock Bonus Agreement, then the Board will: (a)
      determine the nature, length and starting date of any Performance Period for
      each Stock Bonus; (b) select from among the Performance Factors to be used
      to
      measure the performance, if any; and (c) determine the number of Shares that
      may
      be awarded to the Participant. Prior to the payment of any Stock Bonus, the
      Board shall determine the extent to which such Stock Bonuses have been earned.
      Performance Periods may overlap and Participants may participate simultaneously
      with respect to Stock Bonuses that are subject to different Performance Periods
      and different performance goals and other criteria. The number of Shares may
      be
      fixed or may vary in accordance with such performance goals and criteria as
      may
      be determined by the Board. The Board may adjust the performance goals
      applicable to the Stock Bonuses to take into account changes in law and
      accounting or tax rules and to make such adjustments as the Board deems
      necessary or appropriate to reflect the impact of extraordinary or unusual
      items, events or circumstances to avoid windfalls or hardships.

    

    8.3 Form
      of Payment.
      The
      earned portion of a Stock Bonus may be paid to the Participant by the Company
      either currently or on a deferred basis, with such interest or dividend
      equivalent, if any, as the Board may determine. Payment may be made in the
      form
      of cash or whole Shares or a combination thereof, either in a lump sum payment
      or in installments, all as the Board will determine.

     

    
      
         

      

      
        Page
          - 7

        
          

        

      

      
         

      

    

     

    

    9. PAYMENT
      FOR SHARE PURCHASES.

    

    9.1 Payment.
      Payment
      for Shares purchased pursuant to this Plan may be made in cash (by check) or,
      where expressly approved for the Participant by the Board and where permitted
      by
      law:

    

       

    
      	
              (a)

            	
              by
                cancellation of indebtedness of the Company to the
                Participant;

            
	
               

            	
               

            
	
              (b)

            	
              by
                surrender of shares that either: (1) have been owned by Participant
                for
                more than one year and have been paid for within the meaning of Rule
                144
                of the Securities Act of 1933 (and, if such shares were purchased
                from the
                Company by use of a promissory note, such note has been fully paid
                with
                respect to such shares); or (2) were obtained by Participant in the
                public
                market;

            
	
               

            	
               

            
	
              (c)

            	
              by
                waiver of compensation due or accrued to the Participant for services
                rendered;

            
	
               

            	
               

            
	
              (d)

            	
              with
                respect only to purchases upon exercise of an Option, and provided
                that a
                public market for the Company's stock
                exists:

            

    

    

    

    
      	
              (1)

            	
              through
                a “same day sale” commitment from the Participant and a broker-dealer that
                is a member of the National Association of Securities Dealers (an
“NASD
                DEALER”) whereby the Participant irrevocably elects to exercise the Option
                and to sell a portion of the Shares so purchased to pay for the Exercise
                Price, and whereby the NASD Dealer irrevocably commits upon receipt
                of
                such Shares to forward the Exercise Price directly to the Company;
                or

            
	
               

            	
               

            
	
              (2)

            	
              through
                a “margin” commitment from the Participant and a NASD Dealer whereby the
                Participant irrevocably elects to exercise the Option and to pledge
                the
                Shares so purchased to the NASD Dealer in a margin account as security
                for
                a loan from the NASD Dealer in the amount of the Exercise Price,
                and
                whereby the NASD Dealer irrevocably commits upon receipt of such
                Shares to
                forward the Exercise Price directly to the Company;
                or

            

    

    

    

    
      	
              (e)

            	
              by
                any combination of the foregoing.

            

    

    

    10. WITHHOLDING
      TAXES.

    

    10.1 Withholding
      Generally.
      Whenever Shares are to be issued in satisfaction of Awards granted under this
      Plan, the Company may require the Participant to remit to the Company an amount
      sufficient to satisfy federal, state and local withholding tax requirements
      prior to the delivery of any certificate or certificates for such Shares.
      Whenever, under this Plan, payments in satisfaction of Awards are to be made
      in
      cash, such payment will be net of an amount sufficient to satisfy federal,
      state, and local withholding tax requirements.

    

    10.2 Stock
      Withholding.
      When,
      under applicable tax laws, a participant incurs tax liability in connection
      with
      the exercise or vesting of any Award that is subject to tax withholding and
      the
      Participant is obligated to pay the Company the amount required to be withheld,
      the Board may allow the Participant to satisfy the minimum withholding tax
      obligation by electing to have the Company withhold from the Shares to be issued
      that number of Shares having a Fair Market Value equal to the minimum amount
      required to be withheld, determined on the date that the amount of tax to be
      withheld is to be determined. All elections by a Participant to have Shares
      withheld for this purpose will be made in accordance with the requirements
      established by the Board and be in writing in a form acceptable to the
      Board.

    

    11. PRIVILEGES
      OF STOCK OWNERSHIP.

    

    11.1 Voting
      and Dividends.
      No
      Participant will have any of the rights of a stockholder with respect to any
      Shares until the Shares are issued to the Participant. After Shares are issued
      to the Participant, the Participant will be a stockholder and will have all
      the
      rights of a stockholder with respect to such Shares, including the right to
      vote
      and receive all dividends or other distributions made or paid with respect
      to
      such Shares; provided, that if such Shares are Restricted Stock, then any new,
      additional or different securities the Participant may become entitled to
      receive with respect to such Shares by virtue of a stock dividend, stock split
      or any other change in the corporate or capital structure of the Company will
      be
      subject to the same restrictions as the Restricted Stock; provided, further,
      that the Participant will have no right to retain such stock dividends or stock
      distributions with respect to Shares that are repurchased at the Participant's
      Purchase Price or Exercise Price pursuant to Section 12.

     

    
      
         

      

      
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    11.2 Financial
      Statements.
      Pursuant to regulation 260.140.46 of the Rules of the California Corporations
      Commissioner, the Company will provide financial statements to each Participant
      prior to such Participant's purchase of Shares under this Plan, and to each
      Participant annually during the period such Participant has Awards outstanding;
      provided, however, the Company will not be required to provide such financial
      statements to Participants whose services in connection with the Company assure
      them access to equivalent information.

    12. TRANSFERABILITY.

    

    Awards
      granted under this Plan, and any interest therein, will not be transferable
      or
      assignable by Participant, and may not be made subject to execution, attachment
      or similar process, other than by will or by the laws of descent and
      distribution. During the lifetime of the Participant an Award will be
      exercisable only by the Participant. During the lifetime of the Participant,
      any
      elections with respect to an Award may be made only by the Participant unless
      otherwise determined by the Board and set forth in the Award Agreement with
      respect to Awards that are not ISOs.

    

    13. RESTRICTIONS
      ON SHARES.

    

    At
      the
      discretion of the Board, the Company may reserve to itself and/or its
      assignee(s) in the Award Agreement a right to repurchase a portion of or all
      Unvested Shares held by a Participant following such Participant's Termination
      at any time within ninety (90) days after the later of (a) Participant's
      Termination Date, or (b) the date Participant purchases Shares under this Plan.
      Such repurchase by the Company shall be for cash and/or cancellation of purchase
      money indebtedness, and the price per share shall be the Participant's Exercise
      Price or the Purchase Price, as applicable.

    

    14. CERTIFICATES.

    

    All
      certificates for Shares or other securities delivered under this Plan will
      be
      subject to such stock transfer orders, legends and other restrictions as the
      Board may deem necessary or advisable, including restrictions under any
      applicable federal, state or foreign securities law, or any rules, regulations
      and other requirements of the SEC or any stock exchange or automated quotation
      system upon which the Shares may be listed or quoted.

    

    15. ESCROW;
      PLEDGE OF SHARES.

    

    To
      enforce any restrictions on a Participant's Shares, the Board may require the
      Participant to deposit all certificates representing Shares, together with
      stock
      powers or other instruments of transfer approved by the Board appropriately
      endorsed in blank, with the Company or an agent designated by the Company to
      hold in escrow until such restrictions have lapsed or terminated, and the Board
      may cause a legend or legends referencing such restrictions to be placed on
      the
      certificates. Any Participant who is permitted to execute a promissory note
      as
      partial or full consideration for the purchase of Shares under this Plan will
      be
      required to pledge and deposit with the Company all or part of the Shares so
      purchased as collateral to secure the payment of Participant's obligation to
      the
      Company under the promissory note; provided, however, that the Board may require
      or accept other or additional forms of collateral to secure the payment of
      such
      obligation and, in any event, the Company will have full recourse against the
      Participant under the promissory note notwithstanding any pledge of the
      Participant's Shares or other collateral. In connection with any pledge of
      the
      Shares, Participant will be required to execute and deliver a written pledge
      agreement in such form as the Board will from time to time approve. The Shares
      purchased with the promissory note may be released from the pledge on a pro
      rata
      basis as the promissory note is paid.

     

    
      
         

      

      
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    16. EXCHANGE
      AND BUYOUT OF AWARDS.

    

    The
      Board
      may, at any time or from time to time, authorize the Company, with the consent
      of the respective Participants, to issue new Awards in exchange for the
      surrender and cancellation of any or all outstanding Awards. The Board may
      at
      any time buy from a Participant an Award previously granted with payment in
      cash, Shares (including Restricted Stock) or other consideration, based on
      such
      terms and conditions as the Board and the Participant may agree.

    

    17. SECURITIES
      LAW AND OTHER REGULATORY COMPLIANCE.

    

    An
      Award
      will not be effective unless such Award is in compliance with all applicable
      federal and state securities laws, rules and regulations of any governmental
      body, and the requirements of any stock exchange or automated quotation system
      upon which the Shares may then be listed or quoted, as they are in effect on
      the
      date of grant of the Award and also on the date of exercise or other issuance.
      Notwithstanding any other provision in this Plan, the Company will have no
      obligation to issue or deliver certificates for Shares under this Plan prior
      to:
      (a) obtaining any approvals from governmental agencies that the Company
      determines are necessary or advisable; and/or (b) completion of any registration
      or other qualification of such Shares under any state or federal law or ruling
      of any governmental body that the Company determines to be necessary or
      advisable. The Company will be under no obligation to register the Shares with
      the SEC or to effect compliance with the registration, qualification or listing
      requirements of any state securities laws, stock exchange or automated quotation
      system, and the Company will have no liability for any inability or failure
      to
      do so.

    

    18. NO
      OBLIGATION TO EMPLOY.

    

    Nothing
      in this Plan or any Award granted under this Plan will confer or be deemed
      to
      confer on any Participant any right to continue in the employ of, or to continue
      any other relationship with, the Company or any Parent or Subsidiary of the
      Company or limit in any way the right of the Company or any Parent or Subsidiary
      of the Company to terminate Participant's employment or other relationship
      at
      any time, with or without cause.

     

    19. CORPORATE
      TRANSACTIONS.

    

    19.1 Assumption
      or Replacement of Awards by Successor.
      In the
      event of (a) a dissolution or liquidation of the Company, (b) a merger or
      consolidation in which the Company is not the surviving corporation (other
      than
      a merger or consolidation with a wholly-owned subsidiary, a reincorporation
      of
      the Company in a different jurisdiction, or other transaction in which there
      is
      no substantial change in the stockholders of the Company or their relative
      stock
      holdings and the Awards granted under this Plan are assumed, converted or
      replaced by the successor corporation, which assumption will be binding on
      all
      Participants), (c) a merger in which the Company is the surviving corporation
      but after which the stockholders of the Company immediately prior to such merger
      (other than any stockholder that merges, or which owns or controls another
      corporation that merges, with the Company in such merger) cease to own their
      shares or other equity interest in the Company, (d) the sale of substantially
      all of the assets of the Company, or (e) the acquisition, sale, or transfer
      of
      more than 50% of the outstanding shares of the Company by tender offer or
      similar transaction, any or all outstanding Awards may be assumed, converted
      or
      replaced by the successor corporation (if any), which assumption, conversion
      or
      replacement will be binding on all Participants. In the alternative, the
      successor corporation may substitute equivalent Awards or provide substantially
      similar consideration to Participants as was provided to stockholders (after
      taking into account the existing provisions of the Awards). The successor
      corporation may also issue, in place of outstanding Shares of the Company held
      by the Participant, substantially similar shares or other property subject
      to
      repurchase restrictions no less favorable to the Participant. In the event
      such
      successor corporation (if any) refuses to assume or substitute Awards, as
      provided above, pursuant to a transaction described in this Subsection 19.1,
      such Awards will expire on such transaction at such time and on such conditions
      as the Board will determine. Notwithstanding anything in this Plan to the
      contrary, the Board may provide that the vesting of any or all Awards granted
      pursuant to this Plan will accelerate upon a transaction described in this
      Section 19. If the Board exercises such discretion with respect to Options,
      such
      Options will become exercisable in full prior to the consummation of such event
      at such time and on such conditions as the Board determines, and if such Options
      are not exercised prior to the consummation of the corporate transaction, they
      shall terminate at such time as determined by the Board.

     

    
      
         

      

      
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    19.2 Other
      Treatment of Awards.
      Subject
      to any greater rights granted to Participants under the foregoing provisions
      of
      this Section 19, in the event of the occurrence of any transaction described
      in
      Section 19.1, any outstanding Awards will be treated as provided in the
      applicable agreement or plan of merger, consolidation, dissolution, liquidation,
      or sale of assets.

    

    19.3 Assumption
      of Awards by the Company.
      The
      Company, from time to time, also may substitute or assume outstanding awards
      granted by another company, whether in connection with an acquisition of such
      other company or otherwise, by either: (a) granting an Award under this Plan
      in
      substitution of such other company's award; or (b) assuming such award as if
      it
      had been granted under this Plan if the terms of such assumed award could be
      applied to an Award granted under this Plan. Such substitution or assumption
      will be permissible if the holder of the substituted or assumed award would
      have
      been eligible to be granted an Award under this Plan if the other company had
      applied the rules of this Plan to such grant. In the event the Company assumes
      an award granted by another company, the terms and conditions of such award
      will
      remain unchanged (except that the exercise price and the number and nature
      of
      Shares issuable upon exercise of any such option will be adjusted appropriately
      pursuant to Section 424(a) of the Code). In the event the Company elects to
      grant a new Option rather than assuming an existing option, such new Option
      may
      be granted with a similarly adjusted Exercise Price.

    20. ADOPTION
      AND STOCKHOLDER APPROVAL.

    

    This
      Plan
      will become effective on the date on which it is adopted by the Board (the
      “EFFECTIVE DATE”). This Plan shall be approved by the stockholders of the
      Company within twelve (12) months before or after the date this Plan is adopted
      by the Board. Upon the Effective Date, the Board may grant Awards pursuant
      to
      this Plan. In the event that stockholder approval of this Plan is not obtained
      within the time period provided herein, all Awards granted hereunder shall
      be
      cancelled, any Shares issued pursuant to any Awards shall be cancelled and
      any
      purchase of Shares issued hereunder shall be rescinded.

    

    21. TERM
      OF PLAN/GOVERNING LAW.

    

    Unless
      earlier terminated as provided herein, this Plan will terminate ten (10) years
      from the date this Plan is adopted by the Board or, if earlier, the date of
      stockholder approval. This Plan and all agreements there under shall be governed
      by and construed in accordance with the laws of the State of
      California.

    

    22. AMENDMENT
      OR TERMINATION OF PLAN.

    

    The
      Board
      may at any time terminate or amend this Plan in any respect, including without
      limitation amendment of any form of Award Agreement or instrument to be executed
      pursuant to this Plan; provided, however, that the Board will not, without
      the
      approval of the stockholders of the Company, amend this Plan in any manner
      that
      requires such stockholder approval.

    

    23. NONEXCLUSIVITY
      OF THE PLAN.

    

    Neither
      the adoption of this Plan by the Board, the submission of this Plan to the
      stockholders of the Company for approval, nor any provision of this Plan will
      be
      construed as creating any limitations on the power of the Board to adopt such
      additional compensation arrangements as it may deem desirable, including,
      without limitation, the granting of stock options and bonuses otherwise than
      under this Plan, and such arrangements may be either generally applicable or
      applicable only in specific cases.

    

    24. ACTION
      BY BOARD.

    

    Any
      action permitted or required to be taken by the Board or any decision or
      determination permitted or required to be made by the Board pursuant to this
      Plan shall be taken or made in the Board's sole and absolute
      discretion.

     

    
      
         

      

      
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    Execution.
      This
      Plan
      is now signed by all of the Directors of this Corporation, on behalf of the
      Corporation, attesting to the adoption of this Plan.

    

    UraniumCore
      Company

    Dated:
      November 1, 2006 

    

    

    

    
      	
              /s/
                Robert Lunde

            	 
	
              Robert
                Lunde

              president

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