Document:

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Exhibit 10.31

                    ADVANCED AERODYNAMICS & STRUCTURES, INC.
                             2002 STOCK OPTION PLAN

1. PURPOSE. This Stock Option Plan (the "Plan") is intended to serve as an
incentive to, and to encourage stock ownership by, certain eligible participants
rendering services to Advanced Aerodynamics & Structures, Inc., a Delaware
corporation (the "Corporation"), and certain affiliates as set forth below, so
that they may acquire or increase their proprietary interest in the Corporation.

2. ADMINISTRATION.

         2.1 COMMITTEE. The Plan shall be administered by the Board of Directors
of the Corporation (the "Board of Directors") or a committee of two or more
members appointed by the Board of Directors (the "Committee") who are
Non-Employee Directors as defined in Rule 16b-3 promulgated under Section 16 of
the Securities Exchange Act of 1934 and outside directors as defined in Treasury
Regulation Section 1.162-27(e)(3). The Committee shall select one of its members
as Chairman and shall appoint a Secretary, who need not be a member of the
Committee. The Committee shall hold meetings at such times and places as it may
determine and minutes of such meetings shall be recorded. Acts by a majority of
the Committee in a meeting at which a quorum is present and acts approved in
writing by a majority of the members of the Committee shall be valid acts of the
Committee.

         2.2 TERM. If the Board of Directors selects a Committee, the members of
the Committee shall serve on the Committee for the period of time determined by
the Board of Directors and shall be subject to removal by the Board of Directors
at any time. The Board of Directors may terminate the function of the Committee
at any time and resume all powers and authority previously delegated to the
Committee.

         2.3 AUTHORITY. The Committee shall have sole discretion and authority
to grant options under the Plan to eligible participants rendering services to
the Corporation or any "parent" or "subsidiary" of the Corporation, as defined
in Section 424 of the Internal Revenue Code of 1986, as amended (the "Code")
("Parent or Subsidiary"), at such times, under such terms and in such amounts as
it may decide. For purposes of this Plan and any Stock Option Agreement (as
defined below), the term "Corporation" shall include any Parent or Subsidiary,
if applicable. Subject to the express provisions of the Plan, the Committee
shall have complete discretion and authority to interpret the Plan, to
prescribe, amend and rescind the rules and regulations relating to the Plan, to
determine the details and provisions of any Stock Option Agreement, to
accelerate any options granted under the Plan and to make all other
determinations necessary or advisable for the administration of the Plan.

         2.4 TYPE OF OPTION. The Committee shall have full authority and
discretion to determine, and shall specify, whether the eligible individual will
be granted options intended to qualify as incentive options under Section 422 of
the Code ("Incentive Options") or options which are not intended to qualify
under Section 422 of the Code ("Non-Qualified Options"); provided, however, that
Incentive Options shall only be granted to employees of the Corporation, or a
Parent or Subsidiary thereof, and shall be subject to the special limitations
set forth herein attributable to Incentive Options.

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         2.5 INTERPRETATION. The interpretation and construction by the
Committee of any provisions of the Plan or of any option granted under the Plan
shall be final and binding on all parties having an interest in this Plan or any
option granted hereunder. No member of the Committee shall be liable for any
action or determination made in good faith with respect to the Plan or any
option granted under the Plan.

3. ELIGIBILITY.

         3.1 GENERAL. All directors, officers, employees of and certain persons
rendering services to the Corporation, or any Parent or Subsidiary, relative to
the Corporation's, or any Parent's or Subsidiaries', management, operation or
development shall be eligible to receive options under the Plan. The selection
of recipients of options shall be within the sole and absolute discretion of the
Committee. No person shall be granted an option under this Plan unless such
person has executed the grant representation letter set forth on Exhibit "A," as
such Exhibit may be amended by the Committee from time to time and no person
shall be granted an Incentive Option under this Plan unless such person is an
employee of the Corporation, or a Parent or Subsidiary, on the date of grant. No
employee shall be granted more than 50,000 options in any one year period.

         3.2 TERMINATION OF ELIGIBILITY.

                  3.2.1 If an optionee ceases to be employed by the Corporation,
or its Parent or Subsidiary, is no longer an officer or member of the Board of
Directors of the Corporation or no longer performs services for the Corporation,
or its Parent or Subsidiary for any reason (other than for "cause," as
hereinafter defined, or such optionee's death), any option granted hereunder to
such optionee shall expire three months after the date the occurrence giving
rise to such termination of eligibility (or 1 year in the event an optionee is
"disabled," as defined in Section 22(e)(3) of the Code) or upon the date it
expires by its terms, whichever is earlier. Any option that has not vested in
the optionee as of the date of such termination shall immediately expire and
shall be null and void. The Committee shall, in its sole and absolute
discretion, decide, utilizing the provisions set forth in Treasury Regulations
Section 1.421-7(h), whether an authorized leave of absence or absence for
military or governmental service, or absence for any other reason, shall
constitute termination of eligibility for purposes of this Section.

                  3.2.2 If an optionee ceases to be employed by the Corporation,
or its Parent or Subsidiary, is no longer an officer or member of the Board of
Directors of the Corporation, or no longer performs services for the
Corporation, or its Parent or Subsidiary and such termination is as a result of
"cause," as hereinafter defined, then all options granted hereunder to such
optionee shall expire on the date of the occurrence giving rise to such
termination of eligibility or upon the date it expires by its terms, whichever
is earlier, and such optionee shall have no rights with respect to any
unexercised options. For purposes of this Plan, "cause" shall mean an optionee's
personal dishonesty, misconduct, breach of fiduciary duty, incompetence,
intentional failure to perform stated obligations, willful violation of any law,
rule, regulation or final cease and desist order, or any material breach of any
provision of this Plan, any Stock Option Agreement or any employment agreement.
The Board of Directors shall have complete discretion and authority to determine
whether the termination of the optionee is for cause.

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          3.3 DEATH OF OPTIONEE AND TRANSFER OPTION. In the event an optionee
shall die, an option may be exercised (subject to the condition that no option
shall be exercisable after its expiration and only to the extent that the
optionee's right to exercise such option had accrued at the time of the
optionee's death) at any time after the optionee's death by the executors or
administrators of the optionee or by any person or persons who shall have
acquired the option directly from the optionee by bequest or inheritance but not
later than the expiration of the option in accordance with its terms. Except as
otherwise provided in any Stock Option Agreement, any option that has not vested
in the optionee as of the date of death or termination of employment, whichever
is earlier, shall immediately expire and shall be null and void. No option shall
be transferable by the optionee other than by will or the laws of descent and
distribution.

          3.4 LIMITATION ON INCENTIVE OPTIONS. No person shall be granted any
Incentive Option to the extent that the aggregate fair market value of the Stock
(as defined below) to which such options are exercisable for the first time by
the optionee during any calendar year (under all plans of the Corporation as
determined under Section 422(d) of the Code) exceeds $100,000.

4. IDENTIFICATION OF STOCK. The Stock, as defined herein, subject to the options
shall be shares of the Corporation's authorized but unissued or acquired or
reacquired common stock (the "Stock"). The aggregate number of shares subject to
outstanding options shall not exceed twenty million (20,000,000) shares of Stock
(subject to adjustment as provided in Section 6). If any option granted
hereunder shall expire or terminate for any reason without having been exercised
in full, the unpurchased shares subject thereto shall again be available for
purposes of this Plan.

5. TERMS AND CONDITIONS OF OPTIONS. Any option granted pursuant to the Plan
shall be evidenced by an agreement ("Stock Option Agreement") in such form as
the Committee shall from time to time determine, which agreement shall comply
with and be subject to the following terms and conditions:

          5.1 NUMBER OF SHARES. Each option shall state the number of shares of
Stock to which it pertains.

          5.2 OPTION EXERCISE PRICE. Each option shall state the option exercise
price, which shall be determined by the Committee; provided, however, that (i)
the exercise price of any Incentive Option shall not be less than the fair
market value of the Stock, as determined by the Committee, on the date of grant
of such option, (ii) the exercise price of any Incentive Option granted to an
employee who owns more than 10% of the total combined voting power of all
classes of the Corporation's stock, as determined for purposes of Section 422 of
the Code, shall not be less than 110% of the fair market value of the Stock, as
determined by the Committee, on the date of grant of such option, and (iii) the
exercise price of any Non-Qualified Option shall not be less than 100% of the
fair market value of the Stock, as determined by the Committee, on the date of
grant of such option.

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          5.3 TERM OF OPTION. The term of an option granted hereunder shall be
determined by the Committee at the time of grant, but shall not exceed ten years
from the date of the grant. The term of any Incentive Option granted to an
employee who owns more than 10% of the total combined voting power of all
classes of the Corporation's stock, as determined for purposes of Section 422 of
the Code, shall in no event exceed five years from the date of grant. All
options shall be subject to early termination as set forth in this Plan. In no
event shall any option be exercisable after the expiration of its term.

         5.4 METHOD OF EXERCISE. An option shall be exercised by written notice
(Exhibit "B") to the Corporation by the optionee (or successor in the event of
death). Such written notice shall state the number of shares with respect to
which the option is being exercised and designate a time, during normal business
hours of the Corporation, for the delivery thereof ("Exercise Date"), which time
shall be at least 30 days after the giving of such notice unless an earlier date
shall have been mutually agreed upon. At the time specified in the written
notice, the Corporation shall deliver to the optionee at the principal office of
the Corporation, or such other appropriate place as may be determined by the
Committee, a certificate or certificates for such shares. Notwithstanding the
foregoing, the Corporation may postpone delivery of any certificate or
certificates after notice of exercise for such reasonable period as may be
required to comply with any applicable listing requirements of any securities
exchange. In the event an option shall be exercisable by any person other than
the optionee, the required notice under this Section shall be accompanied by
appropriate proof of the right of such person to exercise the option.

         5.5 MEDIUM AND TIME OF PAYMENT. The option exercise price shall be
payable in full on or before the option Exercise Date in any one of the
following alternative forms:

                  5.5.1 Full payment in cash or certified bank or cashier's
check;

                  5.5.2 A Promissory Note (as defined below);

                  5.5.3 Full payment in shares of Stock other securities of the
Corporation having a fair market value on the Exercise Date in the amount equal
to the option exercise price;

                  5.5.4 A combination of the consideration set forth in Sections
5.5.1, 5.5.2 and 5.5.3 equal to the option exercise price; or

                  5.5.5 Any other method of payment complying with the
provisions of Section 422 of the Code with respect to Incentive Options,
including, but not limited to, the delivery by optionee of an irrevocable
direction to a securities broker approved by the Corporation to sell the Stock
and to deliver all or part of the sales proceeds to the Corporation in payment
of all or part of the exercise price and any withholding taxes; provided that
the terms of payment are established by the Committee at the time of grant and
any other method of payment established by the Committee with respect to
Non-Qualified Options.

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          5.6 FAIR MARKET VALUE. The fair market value of a share of Stock or
other security of the Corporation on any relevant date shall be determined in
accordance with the following provisions:

                  5.6.1 If the Stock or other security of the Corporation at the
time is neither listed nor admitted to trading on any stock exchange nor traded
in the over-the-counter market, then the fair market value shall be determined
by the Committee after taking into account such factors as the Committee shall
deem appropriate.

                  5.6.2 If the Stock or other security of the Corporation is not
at the time listed or admitted to trading on any stock exchange but is traded in
the over-the-counter market, the fair market value shall be the mean between the
highest bid and lowest asked prices (or, if such information is available, the
closing selling price) of one share of Stock or other security of the
Corporation on the date in question in the over-the-counter market, as such
prices are reported by the National Association of Securities Dealers through
its NASDAQ system or any successor system. If there are no reported bid and
asked prices (or closing selling price) for the Stock or other security of the
Corporation on the date in question, then the mean between the highest bid price
and lowest asked price (or the closing selling price) on the last preceding date
for which such quotations exist shall be determinative of fair market value.

                  5.6.3 If the Stock or other security of the Corporation is at
the time listed or admitted to trading on any stock exchange, then the fair
market value shall be the closing selling price of one share of Stock or other
security of the Corporation on the date in question on the stock exchange
determined by the Committee to be the primary market for the Stock or other
security of the Corporation, as such price is officially quoted in the composite
tape of transactions on such exchange. If there is no reported sale of Stock or
other security of the Corporation on such exchange on the date in question, then
the fair market value shall be the closing selling price on the exchange on the
last preceding date for which such quotation exists.

         5.7 PROMISSORY NOTE. Subject to the requirements of applicable state or
Federal law or margin requirements, payment of all or part of the purchase price
of the Stock may be made by delivery of a full recourse promissory note
("Promissory Note"). The Promissory Note shall be executed by the optionee, made
payable to the Corporation and bear interest at such rate as the Committee shall
determine, but in no case less than the minimum rate which will not cause under
the Code (i) interest to be imputed, (ii) original issue discount to exist, or
(iii) any other similar results to occur. Unless otherwise determined by the
Committee, interest on the Note shall be payable in quarterly installments on
March 31, June 30, September 30 and December 31 of each year. A Promissory Note
shall contain such other terms and conditions as may be determined by the
Committee; provided, however, that the full principal amount of the Promissory
Note and all unpaid interest accrued thereon shall be due not later than five
years from the date of exercise. The Corporation may obtain from the optionee a
security interest in all shares of Stock issued to the optionee under the Plan
for the purpose of securing payment under the Promissory Note and shall retain
possession of the stock certificates representing such shares in order to
perfect its security interest.

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         5.8 RIGHTS AS A SHAREHOLDER. An optionee or successor shall have no
rights as a shareholder with respect to any Stock underlying any option until
the date of the issuance to such optionee of a certificate for such Stock. No
adjustment shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property) or distributions or other rights for which
the record date is prior to the date such Stock certificate is issued, except as
provided in Section 6.

         5.9 MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS. Subject to the
terms and conditions of the Plan, the Committee may modify, extend or renew
outstanding options granted under the Plan, or accept the surrender of
outstanding options (to the extent not exercised) and authorize the granting of
new options in substitution therefor.

         5.10 VESTING AND RESTRICTIONS. The Committee shall have complete
authority and discretion to set the terms, conditions, restrictions, vesting
schedules and other provisions of any option in the applicable Stock Option
Agreement and shall have complete authority to require conditions and
restrictions on any Stock issued pursuant to this Plan.

         5.11 OTHER PROVISIONS. The Stock Option Agreements shall contain such
other provisions, including without limitation, restrictions or conditions upon
the exercise of options, as the Committee shall deem advisable.

6. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.

         6.1 SUBDIVISION OR CONSOLIDATION. Subject to any required action by
shareholders of the Corporation, the number of shares of Stock covered by each
outstanding option, and the exercise price thereof, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Stock of
the Corporation resulting from a subdivision or consolidation of shares
including, but not limited to, a stock split, reverse stock split,
recapitalization, continuation or reclassification, or the payment of a stock
dividend (but only on the Stock) or any other increase or decrease in the number
of such shares effected without receipt of consideration by the Corporation. Any
fraction of a share subject to option that would otherwise result from an
adjustment pursuant to this Section shall be rounded downward to the next full
number of shares without other compensation or consideration to the holder of
such option.

         6.2 CAPITAL TRANSACTIONS. Upon a sale or exchange of all or
substantially all of the assets of the Corporation, a merger or consolidation in
which the Corporation is not the surviving corporation, a merger, reorganization
or consolidation in which the Corporation is the surviving corporation and
shareholders of the Corporation exchange their stock for securities or property,
a liquidation of the Corporation or similar transaction as determined by the
Committee ("Capital Transaction"), this Plan and each option issued under this
Plan, whether vested or unvested, shall terminate immediately prior to such
Capital Transaction, unless such options are assumed by a successor corporation
in a merger or consolidation; provided, however, that unless the outstanding
options are assumed by a successor corporation in a merger or consolidation,
subject to terms approved by the Committee, all optionees will have the right,
during the 30 days prior to such Capital Transaction, to exercise all vested
options. Notwithstanding the foregoing, in the event there is a merger or

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consolidation where the Corporation is not the surviving corporation, all
options granted under this Plan shall vest 30 days prior to such merger or
consolidation unless such options are assumed by the successor corporation in
such merger or consolidation. The Corporation shall, subject to any
nondisclosure provisions, attempt to provide optionees at least 30 days notice
of the option termination date. The Committee may (but shall not be obligated
to) (i) accelerate the vesting of any option or (ii) apply the foregoing
provisions, including but not limited to termination of this Plan and any
options granted pursuant to the Plan, in the event there is a sale of 51% or
more of the stock of the Corporation in any two year period or a transaction
similar to a Capital Transaction.

         6.3 ADJUSTMENTS. To the extent that the foregoing adjustments relate to
stock or securities of the Corporation, such adjustments shall be made by the
Committee, whose determination in that respect shall be final, binding and
conclusive.

         6.4 ABILITY TO ADJUST. The grant of an option pursuant to the Plan
shall not affect in any way the right or power of the Corporation to make
adjustments, reclassifications, reorganizations or changes of its capital or
business structure or to merge, consolidate, dissolve, liquidate, sell or
transfer all or any part of its business or assets.

         6.5 NOTICE OF ADJUSTMENT. Whenever the Corporation shall take any
action resulting in any adjustment provided for in this Section, the Corporation
shall forthwith deliver notice of such action to each optionee, which notice
shall set forth the number of shares subject to the option and the exercise
price thereof resulting from such adjustment.

         6.6 LIMITATION ON ADJUSTMENTS. Any adjustment, assumption or
substitution of an Incentive Option shall comply with Section 425 of the Code,
if applicable.

7. NONASSIGNABILITY. Options granted under this Plan may not be sold, pledged,
assigned or transferred in any manner other than by will or by the laws of
intestate succession, and may be exercised during the lifetime of an optionee
only by such optionee. Any transfer by the optionee of any option granted under
this Plan in violation of this Section shall void such option and any Stock
Option Agreement entered into by the optionee and the Corporation regarding such
transferred option shall be void and have no further force or effect. No option
shall be pledged or hypothecated in any way, nor shall any option be subject to
execution, attachment or similar process.

8. NO RIGHT OF EMPLOYMENT. Neither the grant nor exercise of any option nor
anything in this Plan shall impose upon the Corporation or any other corporation
any obligation to employ or continue to employ any optionee. The right of the
Corporation and any other corporation to terminate any employee shall not be
diminished or affected because an option has been granted to such employee.

9. TERM OF PLAN. This Plan is effective on the date the Plan is adopted by the
Board of Directors and options may be granted pursuant to the Plan from time to
time within a period of ten (10) years from such date, or the date of any
required shareholder approval required under the Plan, if earlier. Termination
of the Plan shall not affect any option theretofore granted.

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10. AMENDMENT OF THE PLAN. The Board of Directors of the Corporation may,
subject to any required shareholder approval, suspend, discontinue or terminate
the Plan, or revise or amend it in any respect whatsoever with respect to any
shares of Stock at that time not subject to options.

11. APPLICATION OF FUNDS. The proceeds received by the Corporation from the sale
of Stock pursuant to options may be used for general corporate purposes.

12. RESERVATION OF SHARES. The Corporation, during the term of this Plan, shall
at all times reserve and keep available such number of shares of Stock as shall
be sufficient to satisfy the requirements of the Plan.

13. NO OBLIGATION TO EXERCISE OPTION. The granting of an option shall not impose
any obligation upon the optionee to exercise such option.

14. APPROVAL OF BOARD OF DIRECTORS AND SHAREHOLDERS. The Plan shall not take
effect until approved by the Board of Directors of the Corporation. This Plan
shall be approved by a vote of the shareholders within 12 months from the date
of approval by the Board of Directors. In the event such shareholder vote is not
obtained, all options granted hereunder, whether vested or unvested, shall be
null and void.

15. WITHHOLDING TAXES. Notwithstanding anything else to the contrary in this
Plan or any Stock Option Agreement, the exercise of any option shall be
conditioned upon payment by such optionee in cash, or other provisions
satisfactory to the Committee, of all local, state, federal or other withholding
taxes applicable, in the Committee's judgment, to the exercise or to later
disposition of shares acquired upon exercise of an option (including any
repurchase of an option or the Stock).

16. PARACHUTE PAYMENTS. Any outstanding option under the Plan may not be
accelerated to the extent any such acceleration of such option would, when added
to the present value of other payments in the nature of compensation which
becomes due and payable to the optionee would result in the payment to such
optionee of an excess parachute payment under Section 280G of the Code. The
existence of any such excess parachute payment shall be determined in the sole
and absolute discretion of the Committee.

17. SECURITIES LAWS COMPLIANCE. Notwithstanding anything contained herein, the
Corporation shall not be obligated to grant any option under this Plan or to
sell, issue or effect any transfer of any Stock unless such grant, sale,
issuance or transfer is at such time effectively (i) registered or exempt from
registration under the Act and (ii) qualified or exempt from qualification under
the California Corporate Securities Law of 1968 and any other applicable state
securities laws. As a condition to exercise of any option, each optionee shall
make such representations as may be deemed appropriate by counsel to the
Corporation for the Corporation to use any available exemption from registration
under the Act or any applicable state securities law.

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18. RESTRICTIVE LEGENDS. The certificates representing the Stock issued upon
exercise of options granted pursuant to this Plan will bear any legends required
by applicable state or federal securities laws as determined by the Committee.

19. NOTICES. Any notice to be given under the terms of the Plan shall be
addressed to the Corporation in care of its Secretary at its principal office,
and any notice to be given to an optionee shall be addressed to such optionee at
the address maintained by the Corporation for such person or at such other
address as the optionee may specify in writing to the Corporation.

         As adopted by the Board of Directors as of June 17, 2002.

                                        ADVANCED AERODYNAMICS &
                                        STRUCTURES, INC., a Delaware corporation

                                        By: /S/ ROY H. NORRIS
                                            ------------------------------------
                                            Roy H. Norris, Chairman

                                       9<PAGE>
Exhibit 10.32

                          MOONEY AEROSPACE GROUP, LTD.
                             AUDIT COMMITTEE CHARTER

         The Audit Committee (sometimes referred to as the "Committee") is
appointed by the Board of Directors (the "Board") of Mooney Aerospace Group,
Ltd. (the "Company") to assist the Board in monitoring (1) the integrity of the
financial statements of the Company, (2) the compliance by the Company with
legal and regulatory requirements and (3) the independence and performance of
the Company's internal and external auditors.

         The members of the Audit Committee shall meet the independence and
experience requirements of the Nasdaq Stock Exchange. In particular, the
Chairman of the Audit Committee shall have accounting or related financial
management expertise. The members of the Audit Committee shall be appointed by
the Board on the recommendation of the Nominating Committee, if such a committee
exists.

         The Audit Committee shall have the authority to retain special legal,
accounting or other consultants to advise the Committee. The Audit Committee may
request any officer or employee of the Company or the Company's outside counsel
or independent auditor to attend a meeting of the Committee or to meet with any
members of, or consultants to, the Committee. The Audit Committee may also meet
with the Company's investment bankers or financial analysts who follow the
Company.

         The Audit Committee shall make regular reports to the Board.

         The Audit Committee shall:

1. Review and reassess the adequacy of this Charter annually and recommend any
proposed changes to the Board for approval.

2. Review the annual audited financial statements with management, including
major issues regarding accounting and auditing principles and practices as well
as the adequacy of internal controls that could significantly affect the
Company's financial statements.

3. Review an analysis prepared by management and the independent auditor of
significant financial reporting issues and judgments made in connection with the
preparation of the Company's financial statements, including an analysis of the
effect of alternative GAAP methods on the Company's financial statements and a
description of any transactions as to which management obtained Statement on
Auditing Standards No. 50 letters.

4. Review with management and the independent auditor the effect of regulatory
and accounting initiatives as well as off-balance sheet structures on the
Company's financial statements.

5. Review with management and the independent auditor the Company's quarterly
financial statements prior to the filing of its Form 10-Q, including the results
of the independent auditors' reviews of the quarterly financial statements.

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6. Meet periodically with management to review the Company's major financial
risk exposures and the steps management has taken to monitor and control such
exposures.

7. Review major changes to the Company's auditing and accounting principles and
practices as suggested by the independent auditor, internal auditors or
management.

8. Recommend to the Board the appointment of the independent auditor, which firm
is ultimately accountable to the Audit Committee and the Board.

9. Review the experience and qualifications of the senior members of the
independent auditor team and the quality control procedures of the independent
auditor.

10. Approve the fees to be paid to the independent auditor for audit services.

11. Approve the retention of the independent auditor for any non-audit service
and the fee for such service.

12. Receive periodic reports from the independent auditor regarding the
auditor's independence, discuss such reports with the auditor, consider whether
the provision of non-audit services is compatible with maintaining the auditor's
independence and, if so determined by the Audit Committee, recommend that the
Board take appropriate action to satisfy itself of the independence of the
auditor.

13. Evaluate together with the Board the performance of the independent auditor
and, whether it is appropriate to adopt a policy of rotating independent
auditors on a regular basis. If so determined by the Audit Committee, recommend
that the Board replace the independent auditor.

14. Recommend to the Board guidelines for the Company's hiring of employees of
the independent auditor who were engaged on the Company's account.

15. Discuss with the national office of the independent auditor, if any, issues
on which it was consulted by the Company's audit team and matters of audit
quality and consistency.

16. Review the appointment and replacement of the senior internal auditing
executive, if any.

17. Review the significant reports to management prepared by the internal
auditing department, if any, and management's responses.

18. Meet with the independent auditor prior to the audit to review the planning
and staffing of the audit.

19. Obtain from the independent auditor assurance that Section 10A of the
Securities Exchange Act of 1934 has not been implicated.

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20. Obtain reports from management, the Company's senior internal auditing
executive, if any, and the independent auditor that the Company's
subsidiaries/foreign affiliated entities, if any, are in conformity with
applicable legal requirements and the Company's Code of Conduct, when formally
established, including disclosures of insider and affiliated party transactions.

21. Discuss with the independent auditor the matters required to be discussed by
Statement on Auditing Standards No. 61 relating to the conduct of the audit

22. Review with management and the independent auditor any correspondence with
regulators or governmental agencies and any employee complaints or published
reports which raise material issues regarding the Company's financial statements
or accounting policies.

23. Review with the independent auditor any problems or difficulties the auditor
may have encountered and any management letter provided by the auditor and the
Company's response to that letter. Such review should include:

         (a) Any difficulties encountered in the course of the audit work,
         including any restrictions on the scope of activities or access to
         required information, and any disagreements with management.

         (b) Any changes required in the planned scope of the internal audit, if
         one occurs.

         (c) The internal audit department responsibilities, budget and
         staffing, if such a department is established.

24. Prepare the report required by the rules of the Securities and Exchange
Commission to be included in the Company's annual proxy statement.

25. Advise the Board with respect to the Company's policies and procedures
regarding compliance with applicable laws and regulations and with the Company's
Code of Conduct, when formally established.

26. Review with the Company's General Counsel legal matters that may have a
material impact on the financial statements, the Company's compliance policies
and any material reports or inquiries received from regulators or governmental
agencies.

27. Meet at least quarterly with the chief financial officer, the senior
internal auditing executive, if any, and the independent auditor in separate
executive sessions.

         While the Audit Committee has the responsibilities and powers set forth
in this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Company's financial statements are complete and
accurate and are in accordance with generally accepted accounting principles.
This is the responsibility of management and the independent auditor. Nor is it
the duty of the Audit Committee to conduct investigations, to resolve
disagreements, if any, between management and the independent auditor or to
assure compliance with laws and regulations and the Company's Code of Conduct,
when formally established.

         This Charter was adopted by the Board on July 22, 2002.

                                       3

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