Document:

EXHIBIT 10.2

                              SEPARATION AGREEMENT

     This Separation Agreement (this "Agreement"), dated as of October 31, 2006,
by  and between MedCom USA, Incorporated, a Delaware corporation ("MEDCOM") Card
Activation  Technologies  Inc.,  a  Delaware corporation ("CAT") which as of the
date  of  this  agreement  is  a  wholly  owned  subsidiary  of  MedCom.

                                    RECITALS

     Whereas, MedCom desires to separate its several businesses comprised of its
healthcare  and  financial  transaction  solutions  business and its proprietary
patented  payment  transaction  technology, both of which have been continuously
engaged  in  their respective businesses for substantially more than five years,
into  independent  companies;  and

     Whereas,  such  separation will allow the separate companies focus on their
separate  business  models  and  markets,  allow  management  to  focus on their
respective  businesses and enhance access to financing by allowing banks and the
financial  community  to  focus  separately  on  the  respective businesses; and

     Whereas, MedCom intends to Spin-off through a distribution of CAT shares to
the  shareholder's  of  MedCom on a date certain, subject to certain conditions;
and

     Whereas,  the  distribution  of  the CAT shares is intended to be a taxable
event  as  Medcom  will  retain 40% of the CAT Stock, this dristibution will not
meet  the  80%  control  requirement  of  Section  355  and,

     Whereas,  MedCom and CAT have determined that it is necessary and desirable
to set forth certain agreements that will govern certain matters relating to the
Distribution.

     Therefore,  in  consideration  of  the  mutual  agreements,  provisions and
covenants  contained  in  this  agreement,  the  parties to it agree as follows:

                                    AGREEMENT

The  parties,  intending  to  be  legally  bound,  agree  as  follows:

                                    ARTICLE I
                                   DEFINITIONS

     For  purposes  of  this  Agreement,  the  following terms have the meanings
specified  or  referred  to  in  this  Article  I:

     1.1     "ADMINISTRATIVE  SERVICES  AGREEMENT"  means  the  Administrative
Services  Agreement  dated  the  date of this agreement and entered into between
MedCom  and  CAT.

--------------------------------------------------------------------------------
Separation Agreement                                                Page 1 of 11

<PAGE>
     1.2     "AFFILIATE"  means  the  term  "affiliate" as defined in Regulation
12b-2  under  the  Exchange  Act.

     1.3     "ANCILLARY  AGREEMENTS"  means   the  Tax  Sharing  Agreement,  the
Administrative  Services  Agreement and any other agreement entered into between
the parties to this agreement on or prior to the Distribution Date, the terms of
which  are  to  be  effective  after  the  Distribution  Date.

     1.4     "CODE"  means  the  Internal  Revenue  Code  of  1986,  as amended.

     1.5     "COMMISSION"  means  the  Securities  and  Exchange  Commission.

     1.6     "DISTRIBUTION" means the distribution to the MedCom shareholders of
certain  shares  of  CAT  common stock owned by MedCom on the Distribution Date.

     1.7     "DISTRIBUTION  DATE"  means  the  close  of  business  on  the date
determined  by  the MedCom Board as of which the Distribution shall be effected.

     1.8     "ERISA"  means the Employee Retirement Income Security Act of 1974,
as  amended,  or  any  successor  legislation.

     1.9     "EXCHANGE  ACT"  means  the  Securities  Exchange  Act  of 1934, as
amended.

     1.10    "INSURANCE PROCEEDS" means those monies (i) received by an  insured
from an insurance carrier, or (ii) paid by an insurance carrier on behalf of the
insured,  in  either  case  net of any applicable premium adjustments (including
reserves),  retrospectively  rated premium adjustments, deductibles, retentions,
or  costs  paid  by  such  insured.

     1.11    "IRS"  means  the  Internal  Revenue  Service.

     1.12    "MEDCOM  BOARD"  means  the  board  of  directors  of  MedCom.

     1.13    "MEDCOM  STOCK"  means  the  common  stock  of  MedCom.

     1.14    "CAT  COMMON  STOCK"  means  the  common  stock  of  CAT.

     1.15    "LIABILITIES"  means  any  and  all  debts,  losses,  liabilities,
claims,  damages,  obligations,  payments,  costs  and  expenses,  absolute  or
contingent,  mature  or  not  mature,  liquidated  or  unliquidated,  accrued or
unaccrued,  known  or  unknown,  whenever arising (unless otherwise specified in
this  agreement),  including all attorney's fees, costs and expenses relating to
them,  and  including,  without  limitation,  those  debts, losses, liabilities,
claims,  damages,  obligations,  payments, costs and expenses, arising under any
law, rule, regulation, action, threatened action, order or consent decree of any
governmental  entity  or  any  award  of  any  arbitrator of any kind, and those
arising  under  any  contract,  commitment  or  undertaking.

     1.16    "OTC-BB" means the National Association of Securities Dealers Over
the  Counter  Bulletin  Board  quotation  system.

--------------------------------------------------------------------------------
Separation Agreement                                                Page 2 of 11

<PAGE>
     1.17    "RECORD  DATE"  means  the  close  of  business  on the  date to be
determined  by  the  MedCom  Board  as  the  record  date  for the Distribution.

     1.18    "TAX SHARING AGREEMENT" means the tax sharing agreement, dated the
date  of  this  agreement,  entered  into  between  MedCom  and  CAT.

                                   ARTICLE II
                                THE DISTRIBUTION

     2.01    THE  DISTRIBUTION.

             (a)    MedCom  and  CAT  agree  that  effective  at  the  close  of
     business  on  December  15,  2006,  MedCom's  shareholders will be entitled
     to  one  share of CAT common stock for every one share of MedCom stock held
     at  that  time. The payables date for the actual distribution of the shares
     will  be  determined  by  the  Board  of MedCom and shall be based upon the
     filing  of  the  CAT  registration  statement  under  Form  SB-2.

             (b)    On the payable date, MedCom will  deliver  to  the  transfer
     agent  for  CAT  instructions  for  the  stock  transfer  agent to act as a
     distribution  agent  for  the shares of CAT to be distributed to the MedCom
     stockholders.  The distribution agent will effect delivery of the shares of
     the  CAT common stock issuable in the spin off through the transfer agent's
     book-entry registration system by mailing to each record holder a statement
     of holdings detailing the record holder's ownership interest in CAT and the
     method  by  which  the  record  holder  may  access  its  account.  SB-2.

             (c)    Following  the  payable  date,  MedCom shall retain
     60,000,000  shares  of  common  stock  of  CAT.

     2.02    COOPERATION  PRIOR TO THE DISTRIBUTION.  MedCom and CAT shall  take
all  such action as may be necessary or appropriate under the securities or blue
sky  laws  of  states  or  other political subdivisions of the United States, in
connection  with  the  transactions  contemplated  by  this  agreement  and  the
Ancillary  Agreements.

     2.03    CONDITIONS TO DISTRIBUTION. This agreement and the consummation  of
each  of  the  transactions  provided  for in this agreement shall be subject to
approval of the MedCom Board. The MedCom Board shall in its discretion establish
the  Record  Date,  the  Distribution Date and payables date and all appropriate
procedures  in  connection  with  the  Distribution,  but  in no event shall the
Distribution  Date  occur  prior  to  such  time  as  all  of the following have
occurred:  (i) the MedCom Board has formally approved the Distribution; and (ii)
the  transactions contemplated by Article III shall have been consummated in all
material  respects;  provided that the satisfaction of such conditions shall not
create any obligation on the part of MedCom or any other party to this agreement
to effect the Distribution or in any way limit MedCom's power of termination set
forth  in  Section  6.08  or alter the consequences of any such termination from
those  specified  in  such  Section.

--------------------------------------------------------------------------------
Separation Agreement                                                Page 3 of 11

<PAGE>
     2.04    CERTAIN  POST-DISTRIBUTION  TRANSACTIONS.

             (a)    CAT shall comply  with  each  representation  and  statement
     made,  or  to  be  made,  to  any  taxing  authority in connection with any
     ruling  obtained,  or to be obtained, by MedCom and/or CAT, from any taxing
     authority  with respect to the transactions contemplated by this agreement.

             (b)     MedCom  shall  from  time to time  after  the  Distribution
     Date,  and  without  additional  consideration,  execute  such  deeds,
     assignments  and  other  instruments  of  conveyance as may be necessary or
     advisable  to  transfer  or confirm legal, record ownership of assets (both
     real  and  personal)  used  by  CAT  in  its  businesses  to  or  in  CAT.

             (c)     MedCom  and  CAT  may  from  time to time find it desirable
     to  combine  and/or  coordinate  the  purchase  of  various  types  of
     insurance  from  third  party  insurers.  Should  MedCom  and CAT desire to
     combine  and/or  coordinate  the purchase of insurance, it shall be done in
     such  a way that is beneficial to both parties and would require each party
     to  hold  each other harmless from any and all Liabilities of whatever type
     that  might  arise  out  of  the  respective  party's  operations.

             (d)     CAT with MedCom's  cooperation shall also prepare  and file
     with  the  Commission,  an  SB-2  registration  statement  and  a  Form  8,
     which  shall include such information as is necessary to cause the SB-2 and
     the  Form  8  to  become  effective  under  the  Exchange  Act  as  soon as
     practicable.

                                   ARTICLE III
                    TRANSACTIONS RELATING TO THE DISTRIBUTION

     3.01    ALLOCATION  OF  LIABILITIES  BETWEEN  MEDCOM  AND  CAT.

             (a)     As of the Distribution Date, or as soon as possible after,
     CAT  will  become  the  obligor  or  guarantor,  as  applicable,  of    the
     Liabilities  associated  with  the  businesses  being  conducted by CAT and
     identified  in  Exhibit  A  to  this  agreement,  replacing  MedCom in such
     capacity.  CAT shall assume liability for all of the Liabilities identified
     in  Exhibit  A,  and  indemnifies MedCom and holds MedCom harmless from all
     Liabilities  resulting  from them pursuant to the provisions of Article IV.

             (b)     All  intercompany  account balances  between MedCom and CAT
     for  transactions  occurring  prior  to  the  Distribution  Date  shall  be
     settled  by  a  payment  in cash on or shortly after the Distribution Date.

     3.02    SATISFACTION OF ANY CLAIMS AGAINST MEDCOM.  CAT agrees that, except
as  provided  in the tax sharing agreement, the making of the reconciliation and
assumptions  described  in  Section  3.01  by  the  parties shall be in complete
satisfaction  of  any claim which a party might otherwise have against the other
as  parent  or  shareholder  by reason of dividends or tax benefits paid or made
available  between  them  at  any  time  prior  to  the  Distribution.

     3.03    ANCILLARY  AGREEMENTS.  On  or prior to the date of this agreement,
MedCom and CAT shall execute and deliver each Ancillary Agreement to which it is
a  party.

--------------------------------------------------------------------------------
Separation Agreement                                                Page 4 of 11

<PAGE>
     3.04    COMPENSATION  SHARES.  CAT shall reserve for issuance an additional
12,000,000  shares  of  CAT  common  stock  for employees of and consultants for
MedCom  as  consideration  and  compensation  for their efforts in effecting the
transaction  covered  by  this Agreement. Such shares shall be restricted shares
but  shall  be  covered  by  the  CAT registration statement being filed for the
restricted  shares  issued  under  this  Agreement to the MedCom stockholders if
issued  prior  to  the  effective  date  thereof.

     3.05    THE  CAT BOARD. CAT and MedCom shall take all actions which  may be
required  to  elect  or otherwise appoint, on or prior to the Distribution Date,
William  P.  Williams  as  the  sole  director  of  CAT.

                                   ARTICLE IV
                                 INDEMNIFICATION

     4.01    INDEMNIFICATION  BY  MEDCOM.  Except as  otherwise set forth in the
tax  sharing agreement, MedCom shall indemnify, defend and hold harmless CAT and
its  respective  directors,  officers  and  employees  and  each  of  the heirs,
executors,  administrators,  personal representatives, successors and assigns of
any  of  the  foregoing  (the  "CAT  indemnitees")  from and against any and all
Liabilities  of  the  CAT  indemnitees  arising  out of or due to the failure or
alleged  failure of MedCom or any of its Affiliates to pay, perform or otherwise
discharge  in  due  course  any  item  set  forth  in  this  Agreement.

     4.02    INDEMNIFICATION  BY CAT.  Except  as otherwise set forth in the tax
sharing  agreement, CAT shall indemnify, defend and hold harmless MedCom and its
respective  directors,  officers and employees and each of the heirs, executors,
administrators,  personal  representatives, successors and assigns of any of the
foregoing (the "MedCom indemnitees") from and against any and all Liabilities of
the  MedCom  indemnitees arising out of or due to the failure or alleged failure
of  CAT  or  any of its Affiliates to pay, perform or otherwise discharge in due
course  any  item  set  forth  in  this  Agreement.

     4.03    LIMITATIONS  ON  INDEMNIFICATION OBLIGATIONS.  The amount which any
party  (an "indemnifying party") is or may be required to pay to any other party
(an  "indemnitee")  pursuant  to  Section  4.01 or Section 4.02 shall be reduced
(including,  without  limitation,  retroactively)  by  any Insurance Proceeds or
other  amounts  actually recovered by or on behalf of such indemnitee and actual
cash reserves held by or for the benefit of such indemnitee, in reduction of the
related  liability. If an indemnitee shall have received the payment required by
this  agreement from an indemnifying party in respect of any liability and shall
subsequently  actually receive Insurance Proceeds or other amounts in respect of
such  liability, then such indemnitee shall pay to such indemnifying party a sum
equal  to  the  amount  of  such  Insurance  Proceeds  or other amounts actually
received  (up  to  but not in excess of the amount of any indemnity payment made
under  this  Agreement).  An insurer who would otherwise be obligated to pay any
claim shall not be relieved of the responsibility with respect to it, or, solely
by  virtue  of  the  indemnification  provisions  of  this  Agreement,  have any
subrogation  rights with respect to it, it being expressly understood and agreed
that  no  insurer  or  any  other  third party shall be entitled to a "windfall"
(i.e.,  a  benefit  they  would not be entitled to receive in the absence of the
indemnification  provisions  appearing  in  this  agreement)  by  virtue  of the
indemnification  provisions  of  this  Agreement.

--------------------------------------------------------------------------------
Separation Agreement                                                Page 5 of 11

<PAGE>
     4.04    PROCEDURE  FOR  INDEMNIFICATION.

             (a)     If an indemnitee shall receive notice or otherwise learn of
     the  assertion by a person (including, without limitation, any governmental
     entity)  who  is  not  a party to this agreement or to any of the Ancillary
     Agreements  of  any  claim or of the commencement by any such person of any
     action  (a "third party claim") with respect to which an indemnifying party
     may  be  obligated  to  provide indemnification pursuant to this agreement,
     such  indemnitee  shall  give  such indemnifying party written notice of it
     promptly after becoming aware of such third party claim; the failure of any
     indemnitee  to  give  notice  as  provided  in  this Section 4.04 shall not
     relieve  the  related  indemnifying  party  of  its  obligations under this
     Article IV, except to the extent that such indemnifying party is prejudiced
     by  such failure to give notice. Such notice shall describe the third party
     claim in reasonable detail and, if ascertainable, shall indicate the amount
     (estimated if necessary) of the liability that has been or may be sustained
     by  such  indemnitee.

             (b)     An indemnifying party  may elect to defend  or to  seek  to
     settle  or compromise, at such indemnifying party's own expense and by such
     indemnifying  party's own counsel, any third party claim. Within 30 days of
     the receipt of notice from an Indemnitee in accordance with Section 4.04(a)
     (or  sooner,  if  the  nature  of  such third party claim requires it), the
     indemnifying  party shall notify the related indemnitee if the indemnifying
     party  elects  not  to defend or to seek to settle or compromise such third
     party  claim,  which election may be made only in the event of a good faith
     assertion  by  the  indemnifying  party  that  a  claim was inappropriately
     tendered  under  Section  4.01 or 4.02. Unless an indemnifying party elects
     not  to  assume  the  defense of or to seek to settle or compromise a third
     party claim, such indemnifying party shall not be liable to such indemnitee
     under this article IV for any legal or other expenses subsequently incurred
     by  such  Indemnitee in connection with the defense of it; provided that if
     the  defendants  in  any such claim include both the indemnifying party and
     one  or  more  indemnitees,  and  in any indemnitee's reasonable judgment a
     conflict  of  interest  between  one  or  more of such indemnitees and such
     indemnifying  party exists in respect of such claim, such indemnitees shall
     have the right to employ separate counsel to represent such indemnitees and
     in  that  event  the  reasonable fees and expenses of such separate counsel
     (but  not  more  than  one  separate counsel reasonably satisfactory to the
     indemnifying  party) shall be paid by such indemnifying party; and provided
     further  that  the  indemnifying party shall not be entitled to settle such
     action  or  claim  on  behalf  of  the indemnitee without the prior written
     consent  of  the  indemnitee,  which  consent  shall  not  unreasonably  be
     withheld.  For the purposes of this agreement, such consent shall be deemed
     to be reasonably withheld only if such settlement would, in addition to the
     payment  of  money,  impose  an  unreasonable  and  material  burden on the
     indemnitee,  including without limitation a consent judgment or injunction.
     If  an  indemnifying  party  elects not to defend, or elects not to seek to
     settle  or  compromise,  a third party claim, such indemnitee may defend or
     seek  to  compromise  or  settle  such  third  party  claim.

             (c)     If an  indemnifying p arty chooses to defend  or to seek to
     compromise  or settle any third party claim, the related indemnitee, at its
     own  expense, shall make available to such indemnifying party any personnel
     or  any  books,  records  or other documents within its control or which it
     otherwise  has  the  ability  to  make  available  that  are  necessary  or
     appropriate  for

--------------------------------------------------------------------------------
Separation Agreement                                                Page 6 of 11

<PAGE>
     such  defense,  settlement  or compromise, and shall otherwise cooperate in
     the  defense,  settlement  or  compromise  of  such  third  party  claims.

             (d)     Notwithstanding  anything  else  in  this  Section  4.04 to
     the  contrary, neither an indemnifying party nor an indemnitee shall settle
     or  compromise  any  third party claim unless such settlement or compromise
     contemplates  as an unconditional term of it the giving by such claimant or
     plaintiff  to  the indemnitee or the indemnifying party, respectively, of a
     written  release from all liability with respect to such third party claim.

              (e)     Any claim  on account of a liability which does not result
     from  a  third party claim shall be asserted by written notice given by the
     indemnitee to the related indemnifying party. Such indemnifying party shall
     have  a  period of 30 days after the receipt of such notice within which to
     respond  in  writing  to  it.  If  such indemnifying party does not respond
     within  such 30 day period, such indemnifying party shall be deemed to have
     rejected  responsibility  to  make payment. If such indemnifying party does
     respond  in  writing  within  such  30 day period and rejects such claim in
     whole  or in part, or in the event a claim is deemed to have been rejected,
     such  indemnitee  shall be free to pursue such remedies as may be available
     to  such  party  under  applicable  law.

             (f)     In  addition  to  any adjustments  required  pursuant  to
     Section  4.03, if the amount of any liability shall, at any time subsequent
     to  the  payment  required  by  this  agreement,  be  reduced  by recovery,
     settlement  or  otherwise,  the amount of such reduction, less any expenses
     incurred  in  connection  with  them,  shall  promptly  be  repaid  by  the
     indemnitee  to  the  indemnifying  party.

             (g)     Upon  the  written  demand  of  an  indemnitee,  an
     indemnifying  party shall reimburse or advance funds to such indemnitee for
     all  Liabilities reasonably incurred by it in connection with investigating
     or  defending  any  third  party claim in advance of its final disposition;
     provided  that  such  reimbursement  need be made only upon delivery to the
     indemnifying  party  of  an  undertaking  by  such  indemnitee to repay all
     amounts so reimbursed or advanced if it shall ultimately be determined that
     such Indemnitee is not entitled to indemnification under this Article IV or
     otherwise.

             (h)     In  the  event  of  payment  by  an  indemnifying  party to
     any  indemnitee in connection with any third party claim, such indemnifying
     party  shall  be  subrogated  to  and  shall  stand  in  the  place of such
     indemnitee  as  to  any  events  or  circumstances in respect of which such
     indemnitee  may  have any right or claim relating to such third party claim
     against  any  claimant  or  plaintiff  asserting  such third party claim or
     against  any  other  person.  Such  indemnitee  shall  cooperate  with such
     indemnifying  party  in a reasonable manner, and at the cost and expense of
     such  indemnifying party, in prosecuting, in its name or in the name of the
     indemnitee,  any  subrogated  right  or  claim.

     4.05    REMEDIES  CUMULATIVE.  The  remedies  provided  in  this Article IV
shall  be  cumulative  and shall not preclude assertion by any indemnitee of any
other  rights  or  the  seeking  of  any  and  all  other  remedies  against any
indemnifying  party;  provided  that  all  remedies  sought  or  asserted  by an

--------------------------------------------------------------------------------
Separation Agreement                                                Page 7 of 11

<PAGE>
Indemnitee  against  an  indemnifying party with respect to a liability shall be
limited  by  and  be  subject  to  the  provisions  of  this  Article  IV.

     4.06    SURVIVAL  OF INDEMNITIES. The obligations  of each of (i) MedCom on
the  one  hand,  and  (ii)  CAT, on the other hand, under this Article IV, shall
survive  the  sale  or  other  transfer by it of any assets or businesses or the
assignment  by  it  of  any  Liabilities,  with respect to any loss of the other
related  to  such  assets,  businesses  or  Liabilities.

                                    ARTICLE V
                              ACCESS TO INFORMATION

     5.01    ACCESS  TO  INFORMATION.  From  and  after  the  distribution date,
MedCom  shall  afford  to  CAT and its authorized accountants, counsel and other
designated representatives reasonable access (including using reasonable efforts
to  give  access  to  persons  or  firms possessing information) and duplicating
rights  during  normal  business  hours  to  all  records,  books,  contracts,
instruments,  computer  data  and  other  data  and  information  (collectively,
"information") within MedCom's possession or under MedCom's direction or control
relating  to CAT or MedCom insofar as such access is reasonably required by CAT.
Similarly,  CAT  shall  afford to MedCom and its authorized accountants, counsel
and  other  designated  representatives  reasonable  access  (including  using
reasonable  efforts  to  give access to persons or firms possessing information)
and  duplicating rights during normal business hours to information within CAT's
possession or under CAT's direction or control relating to MedCom or CAT insofar
as  such  access  is reasonably required by MedCom. Information may be requested
under  this  article  V  for,  without  limitation,  audit,  accounting, claims,
litigation  and  tax  purposes, as well as for purposes of fulfilling disclosure
and  reporting  obligations  and  for  performing  this  agreement the Ancillary
Agreements  and  the  transactions  contemplated  hereby  and thereby. Except as
otherwise provided herein, MedCom and CAT shall retain and keep confidential all
information  relating  to  the  other  party.  The  confidentiality  obligation
contained  in  this  agreement  shall  not apply to information which (i) is not
confidential  at the time it is obtained by the party, (ii) becomes available to
the  party,  through  no  fault of that party's employees, agents, successors or
assigns under this agreement, from a third party source having no requirement of
confidentiality  to  the  other  party  to  this agreement, (iii) falls into the
public domain through no fault of the party, or (iv) is required to be disclosed
by  law  or  to  a  governmental  agency.

     5.02    RETENTION  OF  RECORDS.  Except  as otherwise agreed to in writing,
each  of  MedCom  and CAT shall retain for a period of at least seven years, all
information  relating  to the other;  provided that after the expiration of such
period,  such information shall not be destroyed or otherwise disposed of at any
time,  except  as  otherwise  provided in the Administrative Services Agreement.

     5.03    PRODUCTION  OF  WITNESSES.  At  all  times  from  and  after  the
Distribution  Date,  each of MedCom and CAT shall use reasonable efforts to make
available  to the other upon written request, its officers, directors, employees
and  agents  as  witnesses  to  the  extent  that such persons may reasonably be
required  in  connection  with any legal, administrative or other proceedings in
which  the  requesting  party  may  from  time  to  time  be  involved.

--------------------------------------------------------------------------------
Separation Agreement                                                Page 8 of 11

<PAGE>
                                   ARTICLE VI
                                  MISCELLANEOUS

     6.01    COMPLETE  AGREEMENT;  CONSTRUCTION.  This  agreement, including any
schedules  and  exhibits  and  the Ancillary Agreements and other agreements and
documents  referred to herein, shall constitute the entire agreement between the
parties  with  respect  to  the  subject  matter  hereof and shall supersede all
previous  negotiations,  commitments  and  writings with respect to such subject
matter.  Notwithstanding any other provisions in this agreement to the contrary,
in  the  event  and  to  the  extent  that there shall be a conflict between the
provisions  of this agreement and the provisions of the tax sharing agreement or
the  Administrative  Services  Agreement,  the  provisions  of  the  tax sharing
agreement  or  the  Administrative  Services  Agreement  shall  control.

     6.02    SURVIVAL  OF  AGREEMENTS. Except  as otherwise contemplated by this
agreement,  all  covenants  and  agreements  of  the  parties  contained in this
agreement  shall  survive  the  Distribution  Date.

     6.03    EXPENSES.  Except  as otherwise  set forth in this agreement or any
Ancillary  Agreement,  all  costs and expenses arising prior to the distribution
date  (whether  or  not then payable) in connection with the consummation of the
transactions contemplated by this agreement other than (i) the fees and expenses
of  any  counsel,  (ii)  costs  incurred  in  connection  with  any  financing
arrangements  entered into by CAT, and (iii) fees of the National Association of
Securities  Dealers,  Inc.  incurred  with  respect  to  the  authorization  for
quotation  of  the  CAT corporate stock, all of which shall be paid by MedCom to
the  extent  that  appropriate  documentation concerning such costs and expenses
shall  be  provided  to  MedCom.  Such costs and expenses shall include, without
limitation,  printing  costs  and  other  expenses  related  to the preparation,
printing  and  Distribution  of  any  registration  statement  and  prospectus.

     6.04    GOVERNING  LAW.  This  agreement shall be governed by and construed
in  accordance  with  the  laws  of the State of Delaware, without regard to the
principles  of  conflicts  of  laws  of  it.

     6.05    NOTICES.  All  notices and  other communications hereunder shall be
in  writing  and shall be delivered by hand or mailed by registered or certified
mail (return receipt requested) to the parties at the following addresses (or at
such other addresses for a party as shall be specified by like notice) and shall
be  deemed  given  on  the  date  on  which  such  notice  is  received:

         To  MedCom:      7975 North Hayden Road, Suite D-333
                          Scottsdale,  AZ  85258

         To  CAT:         33 West Jackson  Blvd., Suite 1618
                          Chicago, IL 60604-3749

     6.06    AMENDMENTS.  This  agreement  may not be modified or amended except
by  an  agreement  in  writing  signed  by  both  parties  hereto.

--------------------------------------------------------------------------------
Separation Agreement                                                Page 9 of 11

<PAGE>
     6.07    SUCCESSORS  AND  ASSIGNS.  This agreement and all of the provisions
hereof  shall  be binding upon and inure to the benefit of the parties and their
respective  successors  and  permitted  assigns.

     6.08    TERMINATION.  This  agreement  may  be  terminated  and  the
Distribution  abandoned at any time prior to the distribution date by and in the
sole  discretion  of the MedCom Board  without the approval of CAT, or of MedCom
shareholders.  In  the  event  of  such  termination,  no  party  shall have any
liability  of  any  kind  to  any  other  party except that expenses incurred in
connection  with  the transactions contemplated hereby shall be paid as provided
in  Section  6.04.

     6.09    NO THIRD-PARTY BENEFICIARIES.  Except for the provisions of Article
IV  relating  to  indemnitees,  this  agreement is solely for the benefit of the
parties  to it and their respective Affiliates and shall not be deemed to confer
upon  third  parties  any remedy, claim, reimbursement, claim of action or other
right  in  excess  of  those  existing  without  reference  to  this  agreement.

     6.10    TITLES  AND  HEADINGS.  Titles  and  headings  to sections  in this
agreement  are  inserted  for  the  convenience  of  reference  only and are not
intended  to  be  part  of  or  to  affect the meaning or interpretation of this
agreement.

     6.12    LEGAL  ENFORCEABILITY.  Any  provision  of this agreement  which is
prohibited  or  unenforceable  shall  be  ineffective  to  the  extent  of  such
prohibition or unenforceability without invalidating the remaining provisions of
it.  Any  such  prohibition  or  unenforceability shall not invalidate or render
unenforceable  such  provision  or  remedies otherwise available to any party to
this  agreement. Without prejudice to any rights or remedies otherwise available
to  any  party to this agreement, each party to this agreement acknowledges that
damages  would  be  inadequate  remedy  for any breach of the provisions of this
agreement  and  agrees  that the obligations of the parties under this agreement
shall  be  specifically  enforceable.

     6.13    DISPUTES.  If  a  dispute  arises between the parties under this or
any Ancillary Agreement, the parties agree that the dispute will be submitted to
a  steering  committee  of  two  members,  one  appointed  by each of party, the
decision  of  such  steering  committee  to  be  binding on both parties, and if
resolution  through  the  steering  committee fails, the parties shall resort to
final  and  binding  arbitration  (unless  a  lawsuit seeks injunctive relief or
specific  performance  or  if the lawsuit involves the tax free treatment of the
spin  off).  In  the  event that any dispute is to be decided by arbitration, an
arbitrator  shall  be  selected  under  the  Rules  of  the American Arbitration
Association.  Any  arbitration  shall be conducted in accordance with said rules
then  in  effect  and  shall be binding on the parties hereto and enforceable in
accordance  therewith.  The parties agree to waive, and not seek, consequential,
special,  indirect  or  incidental  damages  or  punitive  damages.

--------------------------------------------------------------------------------
Separation Agreement                                               Page 10 of 11

<PAGE>
     In  witness,  the parties have caused this agreement to be duly executed as
of  the  day  and  year  first  written  above.

"MEDCOM"                                MEDCOM USA, INCORPORATED,
                                        a Delaware corporation

                                    By: /s/ William P. Williams
                                        ----------------------------------------
                                        William P. Williams, CEO

"CAT"                                   CARD ACTIVATION TECHNOLOGIES INC.,
                                        a Delaware corporation

                                    By: /s/ Michael Malet
                                        ----------------------------------------
                                        Michael Malet, Executive Vice President

--------------------------------------------------------------------------------
Separation Agreement                                               Page 11 of 11WAFERGEN
      BIO-SYSTEMS, INC.

     

    2007
      EQUITY INCENTIVE PLAN

     

    1.    Purpose
      of the Plan.

     

    This
      2007
      Equity Incentive Plan (the “Plan”)
      is
      intended as an incentive, to retain in the employ of and as directors, officers,
      consultants, advisors and employees to WaferGen Bio-systems, Inc., a Nevada
      corporation (the “Company”),
      and
      any Subsidiary of the Company, within the meaning of Section 424(f) of the
      United States Internal Revenue Code of 1986, as amended (the “Code”),
      persons of training, experience and ability, to attract new directors, officers,
      consultants, advisors and employees whose services are considered valuable,
      to
      encourage the sense of proprietorship and to stimulate the active interest
      of
      such persons in the development and financial success of the Company and its
      Subsidiaries.

     

    It
      is
      further intended that certain options granted pursuant to the Plan shall
      constitute incentive stock options within the meaning of Section 422 of the
      Code
      (the “Incentive
      Options”)
      while
      certain other options granted pursuant to the Plan shall be nonqualified stock
      options (the “Nonqualified
      Options”).
      Incentive Options and Nonqualified Options are hereinafter referred to
      collectively as “Options.”

     

    The
      Company intends that the Plan meet the requirements of Rule 16b-3 (“Rule
      16b-3”)
      promulgated under the Securities Exchange Act of 1934, as amended (the
“Exchange
      Act”)
      and
      that transactions of the type specified in subparagraphs (c) to (f) inclusive
      of
      Rule 16b-3 by officers and directors of the Company pursuant to the Plan will
      be
      exempt from the operation of Section 16(b) of the Exchange Act. Further, the
      Plan is intended to satisfy the performance-based compensation exception to
      the
      limitation on the Company’s tax deductions imposed by Section 162(m) of the Code
      with respect to those Options for which qualification for such exception is
      intended. In all cases, the terms, provisions, conditions and limitations of
      the
      Plan shall be construed and interpreted consistent with the Company’s intent as
      stated in this Section 1.

     

    2.    Administration
      of the Plan.

     

    The
      Board
      of Directors of the Company (the “Board”)
      shall
      appoint and maintain as administrator of the Plan a Committee (the “Committee”)
      consisting of two or more directors who are (i) “Independent Directors” (as such
      term is defined under the rules of the NASDAQ Stock Market), (ii) “Non-Employee
      Directors” (as such term is defined in Rule 16b-3) and (iii) “Outside Directors”
(as such term is defined in Section 162(m) of the Code), which shall serve
      at
      the pleasure of the Board. The Committee, subject to Sections 3, 5 and 6 hereof,
      shall have full power and authority to designate recipients of Options and
      restricted stock (“Restricted
      Stock”)
      and to
      determine the terms and conditions of the respective Option and Restricted
      Stock
      agreements (which need not be identical) and to interpret the provisions and
      supervise the administration of the Plan. The Committee shall have the
      authority, without limitation, to designate which Options granted under the
      Plan
      shall be Incentive Options and which shall be Nonqualified Options. To the
      extent any Option does not qualify as an Incentive Option, it shall constitute
      a
      separate Nonqualified Option.

     

    Subject
      to the provisions of the Plan, the Committee shall interpret the Plan and all
      Options and Restricted Stock granted under the Plan, shall make such rules
      as it
      deems necessary for the proper administration of the Plan, shall make all other
      determinations necessary or advisable for the administration of the Plan and
      shall correct any defects or supply any omission or reconcile any inconsistency
      in the Plan or in any Options or Restricted Stock granted under the Plan in
      the
      manner and to the extent that the Committee deems desirable to carry into effect
      the Plan or any Options or Restricted Stock. The act or determination of a
      majority of the Committee shall be the act or determination of the Committee
      and
      any decision reduced to writing and signed by all of the members of the
      Committee shall be fully effective as if it had been made by a majority of
      the
      Committee at a meeting duly held for such purpose. Subject to the provisions
      of
      the Plan, any action taken or determination made by the Committee pursuant
      to
      this and the other Sections of the Plan shall be conclusive on all
      parties.

     

    In
      the
      event that for any reason the Committee is unable to act or if the Committee
      at
      the time of any grant, award or other acquisition under the Plan does not
      consist of two or more Non-Employee Directors, or if there shall be no such
      Committee, or if the Board otherwise determines to administer the Plan, then
      the
      Plan shall be administered by the Board, and references herein to the Committee
      (except in the proviso to this sentence) shall be deemed to be references to
      the
      Board, and any such grant, award or other acquisition may be approved or
      ratified in any other manner contemplated by subparagraph (d) of Rule 16b-3;
      provided,
      however,
      that
      grants to the Company’s Chief Executive Officer or to any of the Company’s other
      four most highly compensated officers that are intended to qualify as
      performance-based compensation under Section 162(m) of the Code may only be
      granted by the Committee. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    3.     Designation
      of Optionees and Grantees.

     

    The
      persons eligible for participation in the Plan as recipients of Options (the
      “Optionees”)
      or
      Restricted Stock (the “Grantees”
and
      together with Optionees, the “Participants”)
      shall
      include directors, officers and employees of, and subject to their meeting
      the
      eligibility requirements of Rule 701 promulgated under the Securities Act of
      1933, as amended (the “Securities
      Act”),
      consultants and advisors to, the Company or any Subsidiary; provided that
      Incentive Options may only be granted to employees of the Company and any
      Subsidiary. In selecting Participants, and in determining the number of shares
      to be covered by each Option or award of Restricted Stock granted to
      Participants, the Committee may consider any factors it deems relevant,
      including, without limitation, the office or position held by the Participant
      or
      the Participant’s relationship to the Company, the Participant’s degree of
      responsibility for and contribution to the growth and success of the Company
      or
      any Subsidiary, the Participant’s length of service, promotions and potential. A
      Participant who has been granted an Option or Restricted Stock hereunder may
      be
      granted an additional Option or Options, or Restricted Stock if the Committee
      shall so determine.

     

    The
      Committee may only grant Options or award Restricted Stock on the first business
      day of each March, June, September or December of any calendar year, or on
      such
      other pre-determined dates as maybe set by the Committee (the “Pre-Determined
      Grant Dates”).
      Notwithstanding the foregoing, the Committee may grant Options or award
      Restricted Stock to a new employee, executive officer, director or consultant
      to
      the Company as an inducement for such person to enter the service of the Company
      on a date other than a Pre-Determined Grant Date.

     

    4.    Stock
      Reserved for the Plan.

     

    Subject
      to adjustment as provided in Section 8 hereof, a total of 2,000,000 shares
      of
      the Company’s common stock, par value $0.001 per share (the “Stock”),
      shall
      be subject to the Plan. The maximum number of shares of Stock that may be
      subject to Options granted under the Plan to any individual in any calendar
      year
      shall not exceed 1,800,000 shares, and the method of counting such shares shall
      conform to any requirements applicable to performance-based compensation under
      Section 162(m) of the Code, if qualification as performance-based compensation
      under Section 162(m) of the Code is intended. The shares of Stock subject to
      the
      Plan shall consist of unissued shares, treasury shares or previously issued
      shares held by any Subsidiary of the Company, and such number of shares of
      Stock
      shall be and is hereby reserved for such purpose. Any of such shares of Stock
      that may remain unissued and that are not subject to outstanding Options at
      the
      termination of the Plan shall cease to be reserved for the purposes of the
      Plan,
      but until termination of the Plan the Company shall at all times reserve a
      sufficient number of shares of Stock to meet the requirements of the Plan.
      Should any Option or award of Restricted Stock expire or be canceled prior
      to
      its exercise or vesting in full or should the number of shares of Stock to
      be
      delivered upon the exercise or vesting in full of an Option or award of
      Restricted Stock be reduced for any reason, the shares of Stock theretofore
      subject to such Option or Restricted Stock may be subject to future Options
      or
      Restricted Stock under the Plan, except where such reissuance is inconsistent
      with the provisions of Section 162(m) of the Code where qualification as
      performance-based compensation under Section 162(m) of the Code is
      intended.

     

    5.    Terms
      and Conditions of Options.

     

    Options
      granted under the Plan shall be subject to the following conditions and shall
      contain such additional terms and conditions, not inconsistent with the terms
      of
      the Plan, as the Committee shall deem desirable:

     

    (a) Option
      Price.
      The
      purchase price of each share of Stock purchasable under an Incentive Option
      shall be determined by the Committee at the time of grant, but shall not be
      less
      than 100% of the Fair Market Value (as defined below) of such share of Stock
      on
      the date the Option is granted; provided,
      however,
      that
      with respect to an Optionee who, at the time such Incentive Option is granted,
      owns (within the meaning of Section 424(d) of the Code) more than 10% of the
      total combined voting power of all classes of stock of the Company or of any
      Subsidiary, the purchase price per share of Stock shall be at least 110% of
      the
      Fair Market Value per share of Stock on the date of grant. The purchase price
      of
      each share of Stock purchasable under a Nonqualified Option shall not be less
      than 100% of the Fair Market Value of such share of Stock on the date the Option
      is granted. The exercise price for each Option shall be subject to adjustment
      as
      provided in Section 8 below. “Fair
      Market Value”
means
      the closing price on the final trading day immediately prior to the grant grant
      of the Stock on the principal securities exchange on which shares of Stock
      are
      listed (if the shares of Stock are so listed), or on the NASDAQ Stock Market
      or
      OTC Bulletin Board (if the shares of Stock are regularly quoted on the NASDAQ
      Stock Market or OTC Bulletin Board, as the case may be), or, if not so listed,
      the mean between the closing bid and asked prices of publicly traded shares
      of
      Stock in the over the counter market, or, if such bid and asked prices shall
      not
      be available, as reported by any nationally recognized quotation service
      selected by the Company, or as determined by the Committee in a manner
      consistent with the provisions of the Code. Anything in this Section 5(a) to
      the
      contrary notwithstanding, in no event shall the purchase price of a share of
      Stock be less than the minimum price permitted under the rules and policies
      of
      any national securities exchange on which the shares of Stock are
      listed.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    (b) Option
      Term.
      The
      term of each Option shall be fixed by the Committee, but no Option shall be
      exercisable more than ten years after the date such Option is granted and in
      the
      case of an Incentive Option granted to an Optionee who, at the time such
      Incentive Option is granted, owns (within the meaning of Section 424(d) of
      the
      Code) more than 10% of the total combined voting power of all classes of stock
      of the Company or of any Subsidiary, no such Incentive Option shall be
      exercisable more than five years after the date such Incentive Option is
      granted.

     

    (c) Exercisability.
      Subject
      to Section 5(j) hereof, Options shall be exercisable at such time or times
      and
      subject to such terms and conditions as shall be determined by the Committee
      at
      the time of grant; provided,
      however,
      that in
      the absence of any Option vesting periods designated by the Committee at the
      time of grant, Options shall vest and become exercisable as to one-third of
      the
      total number of shares subject to the Option on each of the first, second and
      third anniversaries of the date of grant; and provided further that no Options
      shall be exercisable until such time as any vesting limitation required by
      Section 16 of the Exchange Act, and related rules, shall be satisfied if such
      limitation shall be required for continued validity of the exemption provided
      under Rule 16b-3(d)(3).

     

    Upon
      the
      occurrence of a “Change in Control” (as hereinafter defined), the Committee may
      accelerate the vesting and exercisability of outstanding Options, in whole
      or in
      part, as determined by the Committee in its sole discretion. In its sole
      discretion, the Committee may also determine that, upon the occurrence of a
      Change in Control, each outstanding Option shall terminate within a specified
      number of days after notice to the Optionee thereunder, and each such Optionee
      shall receive, with respect to each share of Company Stock subject to such
      Option, an amount equal to the excess of the Fair Market Value of such shares
      immediately prior to such Change in Control over the exercise price per share
      of
      such Option; such amount shall be payable in cash, in one or more kinds of
      property (including the property, if any, payable in the transaction) or a
      combination thereof, as the Committee shall determine in its sole
      discretion.

     

    For
      purposes of the Plan, unless otherwise defined in an employment agreement
      between the Company and the relevant Optionee, a Change in Control shall be
      deemed to have occurred if:

     

    (i) a
      tender
      offer (or series of related offers) shall be made and consummated for the
      ownership of 50% or more of the outstanding voting securities of the Company,
      unless as a result of such tender offer more than 50% of the outstanding voting
      securities of the surviving or resulting corporation shall be owned in the
      aggregate by the stockholders of the Company (as of the time immediately prior
      to the commencement of such offer), any employee benefit plan of the Company
      or
      its Subsidiaries, and their affiliates;

     

    (ii) the
      Company shall be merged or consolidated with another corporation, unless as
      a
      result of such merger or consolidation more than 50% of the outstanding voting
      securities of the surviving or resulting corporation shall be owned in the
      aggregate by the stockholders of the Company (as of the time immediately prior
      to such transaction), any employee benefit plan of the Company or its
      Subsidiaries, and their affiliates;

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    (iii) the
      Company shall sell substantially all of its assets to another corporation that
      is not wholly owned by the Company, unless as a result of such sale more than
      50% of such assets shall be owned in the aggregate by the stockholders of the
      Company (as of the time immediately prior to such transaction), any employee
      benefit plan of the Company or its Subsidiaries and their affiliates;
      or

     

    (iv) a
      Person
      (as defined below) shall acquire 50% or more of the outstanding voting
      securities of the Company (whether directly, indirectly, beneficially or of
      record), unless as a result of such acquisition more than 50% of the outstanding
      voting securities of the surviving or resulting corporation shall be owned
      in
      the aggregate by the stockholders of the Company (as of the time immediately
      prior to the first acquisition of such securities by such Person), any employee
      benefit plan of the Company or its Subsidiaries, and their
      affiliates.

     

    Notwithstanding
      the foregoing, if Change of Control is defined in an employment agreement
      between the Company and the relevant Optionee, then, with respect to such
      Optionee, Change of Control shall have the meaning ascribed to it in such
      employment agreement.

     

    For
      purposes of this Section 5(c), ownership of voting securities shall take into
      account and shall include ownership as determined by applying the provisions
      of
      Rule 13d-3(d)(I)(i) (as in effect on the date hereof) under the Exchange Act.
      In
      addition, for such purposes, “Person” shall have the meaning given in Section
      3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d)
      thereof; provided,
      however,
      that a
      Person shall not include (A) the Company or any of its Subsidiaries; (B) a
      trustee or other fiduciary holding securities under an employee benefit plan
      of
      the Company or any of its Subsidiaries; (C) an underwriter temporarily holding
      securities pursuant to an offering of such securities; or (D) a corporation
      owned, directly or indirectly, by the stockholders of the Company in
      substantially the same proportion as their ownership of stock of the
      Company.

     

    (d) Method
      of Exercise.
      Options
      to the extent then exercisable may be exercised in whole or in part at any
      time
      during the option period, by giving written notice to the Company specifying
      the
      number of shares of Stock to be purchased, accompanied by payment in full of
      the
      purchase price, in cash, or by check or such other instrument as may be
      acceptable to the Committee. As determined by the Committee, in its sole
      discretion, at or after grant, payment in full or in part may be made at the
      election of the Optionee (i) in the form of Stock owned by the Optionee (based
      on the Fair Market Value of the Stock which is not the subject of any pledge
      or
      security interest, (ii) in the form of shares of Stock withheld by the Company
      from the shares of Stock otherwise to be received with such withheld shares
      of
      Stock having a Fair Market Value equal to the exercise price of the Option,
      or
      (iii) by a combination of the foregoing, such Fair Market Value determined
      by
      applying the principles set forth in Section 5(a), provided that the combined
      value of all cash and cash equivalents and the Fair Market Value of any shares
      surrendered to the Company is at least equal to such exercise price and except
      with respect to (ii) above, such method of payment will not cause a
      disqualifying disposition of all or a portion of the Stock received upon
      exercise of an Incentive Option. An Optionee shall have the right to dividends
      and other rights of a stockholder with respect to shares of Stock purchased
      upon
      exercise of an Option at such time as the Optionee (i) has given written notice
      of exercise and has paid in full for such shares, and (ii) has satisfied such
      conditions that may be imposed by the Company with respect to the withholding
      of
      taxes.

     

    (e) Non-transferability
      of Options.
      Options
      are not transferable and may be exercised solely by the Optionee during his
      lifetime or after his death by the person or persons entitled thereto under
      his
      will or the laws of descent and distribution. The Committee, in its sole
      discretion, may permit a transfer of a Nonqualified Option to (i) a trust for
      the benefit of the Optionee, (ii) a member of the Optionee’s immediate family
      (or a trust for his or her benefit) or (iii) pursuant to a domestic relations
      order. Any attempt to transfer, assign, pledge or otherwise dispose of, or
      to
      subject to execution, attachment or similar process, any Option contrary to
      the
      provisions hereof shall be void and ineffective and shall give no right to
      the
      purported transferee.

     

    (f) Termination
      by Death.
      Unless
      otherwise determined by the Committee, if any Optionee’s employment with or
      service to the Company or any Subsidiary terminates by reason of death, the
      Option may thereafter be exercised, to the extent then exercisable (or on such
      accelerated basis as the Committee shall determine at or after grant), by the
      legal representative of the estate or by the legatee of the Optionee under
      the
      will of the Optionee, for a period of one (1) year after the date of such death
      (or, if later, such time as the Option may be exercised pursuant to Section
      14(d) hereof) or until the expiration of the stated term of such Option as
      provided under the Plan, whichever period is shorter.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    (g) Termination
      by Reason of Disability.
      Unless
      otherwise determined by the Committee, if any Optionee’s employment with or
      service to the Company or any Subsidiary terminates by reason of Disability
      (as
      defined below), then any Option held by such Optionee may thereafter be
      exercised, to the extent it was exercisable at the time of termination due
      to
      Disability (or on such accelerated basis as the Committee shall determine at
      or
      after grant), but may not be exercised after ninety (90) days after the date
      of
      such termination of employment or service (or, if later, such time as the Option
      may be exercised pursuant to Section 14(d) hereof) or the expiration of the
      stated term of such Option, whichever period is shorter; provided,
      however,
      that,
      if the Optionee dies within such ninety (90) day period, any unexercised Option
      held by such Optionee shall thereafter be exercisable to the extent to which
      it
      was exercisable at the time of death for a period of one (1) year after the
      date
      of such death (or, if later, such time as the Option may be exercised pursuant
      to Section 14(d) hereof) or for the stated term of such Option, whichever period
      is shorter. “Disability” shall mean an Optionee’s total and permanent
      disability; provided,
      that if
      Disability is defined in an employment agreement between the Company and the
      relevant Optionee, then, with respect to such Optionee, Disability shall have
      the meaning ascribed to it in such employment agreement

     

    (h) Termination
      by Reason of Retirement.
      Unless
      otherwise determined by the Committee, if any Optionee’s employment with or
      service to the Company or any Subsidiary terminates by reason of Normal or
      Early
      Retirement (as such terms are defined below), any Option held by such Optionee
      may thereafter be exercised to the extent it was exercisable at the time of
      such
      Retirement (or on such accelerated basis as the Committee shall determine at
      or
      after grant), but may not be exercised after ninety (90) days after the date
      of
      such termination of employment or service (or, if later, such time as the Option
      may be exercised pursuant to Section 14(d) hereof) or the expiration of the
      stated term of such Option, whichever date is earlier; provided,
      however,
      that,
      if the Optionee dies within such ninety (90) day period, any unexercised Option
      held by such Optionee shall thereafter be exercisable, to the extent to which
      it
      was exercisable at the time of death, for a period of one (1) year after the
      date of such death (or, if later, such time as the Option may be exercised
      pursuant to Section 14(d) hereof) or for the stated term of such Option,
      whichever period is shorter.

     

    For
      purposes of this paragraph (h), “Normal
      Retirement”
shall
      mean retirement from active employment with the Company or any Subsidiary on
      or
      after the normal retirement date specified in the applicable Company or
      Subsidiary pension plan or if no such pension plan, age 65, and “Early
      Retirement”
shall
      mean retirement from active employment with the Company or any Subsidiary
      pursuant to the early retirement provisions of the applicable Company or
      Subsidiary pension plan or if no such pension plan, age 55.

     

    (i) Other
      Terminations.
      Unless
      otherwise determined by the Committee upon grant, if any Optionee’s employment
      with or service to the Company or any Subsidiary is terminated by such Optionee
      for any reason other than death, Disability, Normal or Early Retirement or
      Good
      Reason (as defined below), the Option shall thereupon terminate, except that
      the
      portion of any Option that was exercisable on the date of such termination
      of
      employment or service may be exercised for the lesser of ninety (90) days after
      the date of termination (or, if later, such time as the Option may be exercised
      pursuant to Section 14(d) hereof) or the balance of such Option’s term, which
      ever period is shorter. The transfer of an Optionee from the employ of or
      service to the Company to the employ of or service to a Subsidiary, or vice
      versa, or from one Subsidiary to another, shall not be deemed to constitute
      a
      termination of employment or service for purposes of the Plan.

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    (i) In
      the
      event that the Optionee’s employment or service with the Company or any
      Subsidiary is terminated by the Company or such Subsidiary for “cause” any
      unexercised portion of any Option shall immediately terminate in its entirety.
      For purposes hereof, unless otherwise defined in an employment agreement between
      the Company and the relevant Optionee, “Cause” shall exist upon a good-faith
      determination by the Board, following a hearing before the Board at which an
      Optionee was represented by counsel and given an opportunity to be heard, that
      such Optionee has been accused of fraud, dishonesty or act detrimental to the
      interests of the Company or any Subsidiary of Company or that such Optionee
      has
      been accused of or convicted of an act of willful and material embezzlement
      or
      fraud against the Company or of a felony under any state or federal statute;
      provided,
      however,
      that it
      is specifically understood that “Cause” shall not include any act of commission
      or omission in the good-faith exercise of such Optionee’s business judgment as a
      director, officer or employee of the Company, as the case may be, or upon the
      advice of counsel to the Company. Notwithstanding the foregoing, if Cause is
      defined in an employment agreement between the Company and the relevant
      Optionee, then, with respect to such Optionee, Cause shall have the meaning
      ascribed to it in such employment agreement.

     

    (ii) In
      the
      event that an Optionee is removed as a director, officer or employee by the
      Company at any time other than for “Cause” or resigns as a director, officer or
      employee for “Good Reason” the Option granted to such Optionee may be exercised
      by the Optionee, to the extent the Option was exercisable on the date such
      Optionee ceases to be a director, officer or employee. Such Option may be
      exercised at any time within one (1) year after the date the Optionee ceases
      to
      be a director, officer or employee (or, if later, such time as the Option may
      be
      exercised pursuant to Section 14(d) hereof), or the date on which the Option
      otherwise expires by its terms; which ever period is shorter, at which time
      the
      Option shall terminate; provided,
      however,
      if the
      Optionee dies before the Options terminate and are no longer exercisable, the
      terms and provisions of Section 5(f) shall control. For purposes of this Section
      5(i), and unless otherwise defined in an employment agreement between the
      Company and the relevant Optionee, Good Reason shall exist upon the occurrence
      of the following:

     

    
      	 	
              (A)

            	
              the
                assignment to Optionee of any duties inconsistent with the position
                in the
                Company that Optionee held immediately prior to the
                assignment;

            

    

     

    
      	 	
              (B)

            	
              a
                Change of Control resulting in a significant adverse alteration in
                the
                status or conditions of Optionee’s participation with the Company or other
                nature of Optionee’s responsibilities from those in effect prior to such
                Change of Control, including any significant alteration in Optionee’s
                responsibilities immediately prior to such Change in Control;
                and

            

    

     

    
      	 	
              (C)

            	
              the
                failure by the Company to continue to provide Optionee with benefits
                substantially similar to those enjoyed by Optionee prior to such
                failure.

            

    

     

    Notwithstanding
      the foregoing, if Good Reason is defined in an employment agreement between
      the
      Company and the relevant Optionee, then, with respect to such Optionee, Good
      Reason shall have the meaning ascribed to it in such employment
      agreement.

     

    (j) Limit
      on Value of Incentive Option.
      The
      aggregate Fair Market Value, determined as of the date the Incentive Option
      is
      granted, of Stock for which Incentive Options are exercisable for the first
      time
      by any Optionee during any calendar year under the Plan (and/or any other stock
      option plans of the Company or any Subsidiary) shall not exceed
      $100,000.

     

    6.    Terms
      and Conditions of Restricted Stock.

     

    Restricted
      Stock may be granted under this Plan aside from, or in association with, any
      other award and shall be subject to the following conditions and shall contain
      such additional terms and conditions (including provisions relating to the
      acceleration of vesting of Restricted Stock upon a Change of Control), not
      inconsistent with the terms of the Plan, as the Committee shall deem
      desirable:

     

    (a) Grantee
      rights.
      A
      Grantee shall have no rights to an award of Restricted Stock unless and until
      Grantee accepts the award within the period prescribed by the Committee and,
      if
      the Committee shall deem desirable, makes payment to the Company in cash, or
      by
      check or such other instrument as may be acceptable to the Committee. After
      acceptance and issuance of a certificate or certificates, as provided for below,
      the Grantee shall have the rights of a stockholder with respect to Restricted
      Stock subject to the non-transferability and forfeiture restrictions described
      in Section 6(d) below.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    (b) Issuance
      of Certificates.
      The
      Company shall issue in the Grantee’s name a certificate or certificates for the
      shares of Common Stock associated with the award promptly after the Grantee
      accepts such award.

     

    (c) Delivery
      of Certificates.
      Unless
      otherwise provided, any certificate or certificates issued evidencing shares
      of
      Restricted Stock shall not be delivered to the Grantee until such shares are
      free of any restrictions specified by the Committee at the time of
      grant.

     

    (d) Forfeitability,
      Non-transferability of Restricted Stock.
      Shares
      of Restricted Stock are forfeitable until the terms of the Restricted Stock
      grant have been satisfied. Shares of Restricted Stock are not transferable
      until
      the date on which the Committee has specified such restrictions have lapsed.
      Unless otherwise provided by the Committee at or after grant, distributions
      in
      the form of dividends or otherwise of additional shares or property in respect
      of shares of Restricted Stock shall be subject to the same restrictions as
      such
      shares of Restricted Stock.

     

    (e) Change
      of Control.
      Upon
      the occurrence of a Change in Control as defined in Section 5(c), the Committee
      may accelerate the vesting of outstanding Restricted Stock, in whole or in
      part,
      as determined by the Committee, in its sole discretion.

     

    (f) Termination
      of Employment.
      Unless
      otherwise determined by the Committee at or after grant, in the event the
      Grantee ceases to be an employee or otherwise associated with the Company for
      any other reason, all shares of Restricted Stock theretofore awarded to him
      which are still subject to restrictions shall be forfeited and the Company
      shall
      have the right to complete the blank stock power. The Committee may provide
      (on
      or after grant) that restrictions or forfeiture conditions relating to shares
      of
      Restricted Stock will be waived in whole or in part in the event of termination
      resulting from specified causes, and the Committee may in other cases waive
      in
      whole or in part restrictions or forfeiture conditions relating to Restricted
      Stock.

     

    7.    Term
      of Plan.

     

    No
      Option
      or award Restricted Stock shall be granted pursuant to the Plan on the date
      which is ten years from the effective date of the Plan, but Options and award
      of
      Restricted Stock theretofore granted may extend beyond that date.

     

    8.    Capital
      Change of the Company.

     

    In
      the
      event of any merger, reorganization, consolidation, recapitalization, stock
      dividend, or other change in corporate structure affecting the Stock, the
      Committee shall make an appropriate and equitable adjustment in the number
      and
      kind of shares reserved for issuance under the Plan and in the number and option
      price of shares subject to outstanding Options granted under the Plan, to the
      end that after such event each Optionee’s proportionate interest shall be
      maintained (to the extent possible) as immediately before the occurrence of
      such
      event. The Committee shall, to the extent feasible, make such other adjustments
      as may be required under the tax laws so that any Incentive Options previously
      granted shall not be deemed modified within the meaning of Section 424(h) of
      the
      Code. Appropriate adjustments shall also be made in the case of outstanding
      Restricted Stock granted under the Plan.

     

    The
      adjustments described above will be made only to the extent consistent with
      continued qualification of the Option under Section 422 of the Code (in the
      case
      of an Incentive Option) and Section 409A of the Code.

     

    9.    Purchase
      for Investment/Conditions.

     

    Unless
      the Options and shares covered by the Plan have been registered under the
      Securities Act, or the Company has determined that such registration is
      unnecessary, each person exercising or receiving Options or Restricted Stock
      under the Plan may be required by the Company to give a representation in
      writing that he is acquiring the securities for his own account for investment
      and not with a view to, or for sale in connection with, the distribution of
      any
      part thereof. The Committee may impose any additional or further restrictions
      on
      awards of Options or Restricted Stock as shall be determined by the Committee
      at
      the time of award.

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    10.   Taxes.

     

    (a) The
      Company may make such provisions as it may deem appropriate, consistent with
      applicable law, in connection with any Options or Restricted Stock granted
      under
      the Plan with respect to the withholding of any taxes (including income or
      employment taxes) or any other tax matters.

     

    (b) If
      any
      Grantee, in connection with the acquisition of Restricted Stock, makes the
      election permitted under Section 83(b) of the Code (that is, an election to
      include in gross income in the year of transfer the amounts specified in Section
      83(b)), such Grantee shall notify the Company of the election with the Internal
      Revenue Service pursuant to regulations issued under the authority of Code
      Section 83(b).

     

    (c) If
      any
      Grantee shall make any disposition of shares of Stock issued pursuant to the
      exercise of an Incentive Option under the circumstances described in Section
      421(b) of the Code (relating to certain disqualifying dispositions), such
      Grantee shall notify the Company of such disposition within ten (10) days
      hereof.

     

    11.   Effective
      Date of Plan.

     

    The
      Plan
      shall be effective on January 31, 2007; provided, however, that if, and only
      if,
      certain options are intended to qualify as Incentive Stock Options, the Plan
      must subsequently be approved by majority vote of the Company’s stockholders no
      later than January 31, 2008, and further, that in the event certain Option
      grants hereunder are intended to qualify as performance-based compensation
      within the meaning of Section 162(m) of the Code, the requirements as to
      stockholder approval set forth in Section 162(m) of the Code are
      satisfied.

     

    12.   Amendment
      and Termination.

     

    The
      Board
      may amend, suspend, or terminate the Plan, except that no amendment shall be
      made that would impair the rights of any Participant under any Option or
      Restricted Stock theretofore granted without the Participant’s consent, and
      except that no amendment shall be made which, without the approval of the
      stockholders of the Company would:

     

    (a) materially
      increase the number of shares that may be issued under the Plan, except as
      is
      provided in Section 8;

     

    (b) materially
      increase the benefits accruing to the Participants under the Plan;

     

    (c) materially
      modify the requirements as to eligibility for participation in the
      Plan;

     

    (d) decrease
      the exercise price of an Incentive Option to less than 100% of the Fair Market
      Value per share of Stock on the date of grant thereof or the exercise price
      of a
      Nonqualified Option to less than 100% of the Fair Market Value per share of
      Stock on the date of grant thereof; or

     

    (e) extend
      the term of any Option beyond that provided for in Section 5(b).

     

    (f) except
      as
      otherwise provided in Sections 5(d) and 8 hereof, reduce the exercise price
      of
      outstanding Options or effect repricing through cancellations and re-grants
      of
      new Options.

     

    Subject
      to the forgoing, the Committee may amend the terms of any Option theretofore
      granted, prospectively or retrospectively, but no such amendment shall impair
      the rights of any Optionee without the Optionee’s consent.

     

    It
      is the
      intention of the Board that the Plan comply strictly with the provisions of
      Section 409A of the Code and Treasury Regulations and other Internal Revenue
      Service guidance promulgated thereunder (the “Section
      409A Rules”)
      and
      the Committee shall exercise its discretion in granting awards hereunder (and
      the terms of such awards), accordingly. The Plan and any grant of an award
      hereunder may be amended from time to time (without, in the case of an award,
      the consent of the Participant) as may be necessary or appropriate to comply
      with the Section 409A Rules.

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    13.   Government
      Regulations.

     

    The
      Plan,
      and the grant and exercise of Options or Restricted Stock hereunder, and the
      obligation of the Company to sell and deliver shares under such Options and
      Restricted Stock shall be subject to all applicable laws, rules and regulations,
      and to such approvals by any governmental agencies, national securities
      exchanges and interdealer quotation systems as may be required.

     

    14.    General
      Provisions.

     

    (a) Certificates.
      All
      certificates for shares of Stock delivered under the Plan shall be subject
      to
      such stop transfer orders and other restrictions as the Committee may deem
      advisable under the rules, regulations and other requirements of the Securities
      and Exchange Commission, or other securities commission having jurisdiction,
      any
      applicable Federal or state securities law, any stock exchange or interdealer
      quotation system upon which the Stock is then listed or traded and the Committee
      may cause a legend or legends to be placed on any such certificates to make
      appropriate reference to such restrictions.

     

    (b) Employment
      Matters.
      Neither
      the adoption of the Plan nor any grant or award under the Plan shall confer
      upon
      any Participant who is an employee of the Company or any Subsidiary any right
      to
      continued employment or, in the case of a Participant who is a director,
      continued service as a director, with the Company or a Subsidiary, as the case
      may be, nor shall it interfere in any way with the right of the Company or
      any
      Subsidiary to terminate the employment of any of its employees, the service
      of
      any of its directors or the retention of any of its consultants or advisors
      at
      any time.

     

    (c) Limitation
      of Liability.
      No
      member of the Committee, or any officer or employee of the Company acting on
      behalf of the Committee, shall be personally liable for any action,
      determination or interpretation taken or made in good faith with respect to
      the
      Plan, and all members of the Committee and each and any officer or employee
      of
      the Company acting on their behalf shall, to the extent permitted by law, be
      fully indemnified and protected by the Company in respect of any such action,
      determination or interpretation.

     

    (d) Registration
      of Stock.
      Notwithstanding any other provision in the Plan, no Option may be exercised
      unless and until the Stock to be issued upon the exercise thereof has been
      registered under the Securities Act and applicable state securities laws, or
      are, in the opinion of counsel to the Company, exempt from such registration
      in
      the United States. The Company shall not be under any obligation to register
      under applicable federal or state securities laws any Stock to be issued upon
      the exercise of an Option granted hereunder in order to permit the exercise
      of
      an Option and the issuance and sale of the Stock subject to such Option,
      although the Company may in its sole discretion register such Stock at such
      time
      as the Company shall determine. If the Company chooses to comply with such
      an
      exemption from registration, the Stock issued under the Plan may, at the
      direction of the Committee, bear an appropriate restrictive legend restricting
      the transfer or pledge of the Stock represented thereby, and the Committee
      may
      also give appropriate stop transfer instructions with respect to such Stock
      to
      the Company’s transfer agent.

     

    15.    Non-Uniform
      Determinations.

     

    The
      Committee’s determinations under the Plan, including, without limitation, (i)
      the determination of the Participants to receive awards, (ii) the form, amount
      and timing of such awards, (iii) the terms and provisions of such awards and
      (ii) the agreements evidencing the same, need not be uniform and may be made
      by
      it selectively among Participants who receive, or who are eligible to receive,
      awards under the Plan, whether or not such Participants are similarly
      situated.

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    16.   
       
Governing
      Law.

     

    The
      validity, construction, and effect of the Plan and any rules and regulations
      relating to the Plan shall be determined in accordance with the internal laws
      of
      the State of Nevada, without giving effect to principles of conflicts of laws,
      and applicable federal law.

     

    
      
        
        

      

      
        -10-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00124-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00124-of-00352.parquet"}]]