Document:

Exhibit
10.1

                

                NEVADA
GOLD & CASINOS, INC.

                2009
EQUITY INCENTIVE PLAN

                                                                       

                (Adopted
February 24, 2009)

                

                1.           The Plan.  This 2009
Equity Incentive Plan (the “Plan”) is intended to provide incentive to
individuals who have responsibility for the management and growth of Nevada Gold
& Casinos, Inc. (the “Company”) and its subsidiaries (including subsidiaries
which become such after the adoption of the Plan) to promote the success of the
Company’s business by aligning the financial interests of employees,
non-employee directors and consultants providing personal services to the
Company and its subsidiaries with long-term shareholder value.

                 

                2.           Types of
Awards.  The following types of awards (each, an “Award”) may
be granted: (a) options intended to qualify as incentive stock options (“ISOs”)
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended (the “Code”), (b) options not intended to qualify as ISOs (“NSOs” and
together with ISOs, “Options”), (c) stock appreciation rights (“SARs”) and (d)
restricted stock grants (“Stock Grants”).

                 

                3.           Stock Subject to the
Plan.  Subject to the provisions of Section 10 hereof, the
total number of shares of Common Stock, par value $.12 per share, of the Company
(the “Stock”) which may be issued pursuant to Awards issued under the Plan is
1,750,000.  Shares of Stock issued under the Plan may be authorized
but unissued shares of Stock or Stock held as treasury stock.  The
following shares of Stock may also be used for issuance of Awards under the
Plan:  (i) shares of Stock which have been forfeited under a
Stock Grant; and (ii) shares of Stock which are allocable to the unexercised
portion of an Option issued under the Plan which has expired or been
terminated.  Subject to the provisions of Section 10, no more than
1,500,000 shares of Stock may be issued upon the exercise of ISOs issued under
the Plan.  Each share of Stock issuable upon exercise of an Option or
subject to a Stock Grant and each share of Stock as to which an SAR is
associated shall be counted as one share of Stock at the time of grant for
purposes of the limit set forth under this Section and the limit set forth under
Section 6(b).  With respect to the combination of a Tandem SAR and an
Option, where the exercise of the Tandem SAR or the Option results in the
cancellation of the other, each share of Stock associated with a Tandem SAR and
the associated Option will only count as one share of Stock at the time of grant
for purposes of the limits set forth in this Section and in Section
6(b).

                 

                4.           Administration.  The
Plan shall be administered by the Compensation Committee of the Board of
Directors (the “Committee”) composed of no fewer than two (2) members of the
Board of Directors of the Company (the “Board”) each of whom meets the
definition of “outside director” under the provisions of Section 162(m) of the
Code and the definition of “non-employee director” under the provisions of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”) or rules and
regulations promulgated thereunder.  Except as otherwise provided
herein, the Committee shall have plenary authority in its discretion, among
other things, to determine to whom among the eligible persons Awards shall be
granted, the number of shares of Stock covered by or associated with an Award,
the terms of each Award, and whether any Option is intended to be an ISO or an
NSO.  The Committee shall have plenary authority, subject to the
express provisions of the Plan, to interpret the Plan, to prescribe, amend and
rescind any rules and regulations relating to the Plan and to take such other
action in connection with the Plan as it deems necessary or
advisable.  The interpretation, construction and administration by the
Committee of any provisions of the Plan or of any Award granted hereunder shall
be final and binding on recipients of Awards hereunder.

                 

                5.           Eligibility.  All
employees of the Company and its subsidiaries (including, except for purposes of
the last sentence of Section 6(a), persons who have accepted offers of
employment), consultants to the Company and its subsidiaries, and non-employee
directors of the Company shall be eligible for Awards under the
Plan.  In making the determination as to employees, consultants and
directors to whom Awards shall be granted and as to the number of shares of
Stock to be covered by or associated with such Awards, the Committee shall take
into account the duties of the respective employees, consultants and directors,
their present and potential contributions to the success of the Company and such
other factors as the Committee shall deem relevant in connection with
accomplishing the purpose of the Plan.  The adoption of the Plan shall
not be deemed to give any employee, consultant or director any right to an
Award, except to the extent and upon such terms and conditions as may be
determined by the Committee.  Neither the Plan nor any Award granted
hereunder is intended to or shall confer upon any Grantee any right with respect
to continuation of employment or retention by the Company or any of its
subsidiaries.

                
                  
                     

                  

                  
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                6.           Certain Limits on
Awards.

                 

                (a)           Limit on
ISOs.  The aggregate Fair Market Value (determined as of the
date of the Option grant) of Stock with respect to which ISOs granted to an
employee (whether under the Plan or under any other stock option plan of the
Company or its subsidiaries) become exercisable for the first time in any
calendar year may not exceed $100,000 (or such other amount as the Internal
Revenue Service may decide from time to time for purposes of Section 422 of the
Code). If any grant of Options is made to a Grantee in excess of the limits
provided in the Code, the excess shall automatically be treated as an
NSO.  Only employees of the Company or any of its subsidiaries shall
be eligible to receive the grant of an ISO.

                 

                (b)           Limit on all
Awards.  The number of shares of Stock with respect to which an
employee may be granted Awards under the Plan during any calendar year shall not
exceed 250,000, subject to the provisions of Section 10.

                 

                7.           Terms and Conditions of
Options.   The Committee may in its discretion grant Options,
which shall be subject to the following terms and conditions and such other
terms and conditions as the Committee may prescribe:

                 

                (a)           Form of
Option.  Each Option granted pursuant to the Plan shall be
evidenced by an agreement (the “Option Agreement”) which shall clearly identify
the status of the Option granted (i.e., whether an ISO or an
NSO) and which shall be in such form as the Committee shall from time to time
approve.  The Option Agreement shall comply in all respects with the
terms and conditions of the Plan and may contain such additional provisions,
including, without limitation, restrictions upon the exercise of the Option as
the Committee shall deem advisable.

                 

                (b)           Stated
Term.  The term of each Option granted hereunder shall be for a
maximum of ten years from the date of granting thereof, or a maximum of five
years in the case of an ISO granted to a 10% Holder (as such term is defined in
Section 16), but may be for a lesser period or be subject to earlier
termination as provided by the Committee, the provisions of the Plan or the
Option Agreement.

                 

                (c)           Option Exercise
Price.  Each Option shall state a per share option exercise
price, which shall be not less than 100% of the Fair Market Value of a share of
Stock on the date of the Option grant, nor less than 110% of such Fair Market
Value in the case of an ISO granted to an individual who, at the time the Option
is granted, is a 10% Holder.  The Fair Market Value of shares of Stock
shall be determined by the Committee based upon (i) the average of the high and
low prices of the Stock on the NYSE Alternext US on the date of the granting of
the Award, or (ii) such other measure of fair market value as may
reasonably be determined by the Board (but consistent with the rules under
Section 409A of the Code).  “Fair Market Value” as used throughout the
Plan shall mean the fair market value as determined in accordance with this
Section.

                 

                (d)           Exercise of
Options.  An Option may be exercised from time to time as to
any part or all of the Stock as to which it is then exercisable in accordance
with its terms, provided, however, that an Option may not be exercised as to
fewer than 100 shares at any time (or for the remaining shares then
purchasable under the Option, if fewer than 100 shares).  The Option
exercise price shall be paid in full at the time of the exercise thereof (i) in
cash, (ii) by shares of Stock (including by withholding shares of Stock
deliverable upon exercise of the Option) with a Fair Market Value equal to such
exercise price, or (iii) by a combination of cash and shares of Stock pursuant
to clause (ii) above, provided that the withholding of shares of Stock
deliverable upon exercise of the Option shall not be permitted with respect to
the exercise of any Option intended to qualify as an ISO.  The holder
of an Option shall not have any rights as a stockholder with respect to the
Stock issuable upon exercise of an Option prior to the date of
exercise.

                 

                (e)           Non-Transferability of
Options.  Options shall not be transferable other than by will
or the laws of descent and distribution, and shall be exercisable during the
lifetime of the Grantee only by him or his legal representative.  Any
attempt to transfer an Option other than as permitted above shall terminate the
Option and all rights of the Grantee to that Option.

                 

                (f)           Cessation of
Service.

                 

                (i)           Termination
Date.  For purposes of the Plan, the phrase “cessation of
service” or any variation thereof shall mean (A) with respect to an employee,
such employee’s ceasing to be employed by the Company or any of its
subsidiaries, (B) with respect to a non-employee director, such director’s
ceasing to be a member of the Board, or (C) with respect to a consultant,
termination of the contractual relationship between such consultant and the
Company, in each instance for any reason, including in the case of employees, as
a result of Retirement or Disability.  The phrase “Termination Date”
shall mean the date of any cessation of service.  With respect to
employees, the Committee shall determine on a case by case basis whether an
authorized leave of absence or absence on military or government service shall
constitute a termination of the employment of the employee.

                
                  
                     

                  

                  
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                (ii)           Termination of Employee
Options.

                 

                (A)           Death of the
Grantee.  In the event of a Grantee’s death (A) while
providing services to the Company or any of its subsidiaries as an employee, or
(B) following a termination of employment due to Disability, unless otherwise
expressly provided in the Option Agreement, the Option shall become fully
exercisable by the Grantee’s estate upon such Grantee’s death and shall remain
exercisable for a period of twelve (12) months following the Grantee’s death
(or, if shorter, the remainder of the Option term as set forth in the Option
Agreement).

                 

                (B)           Other Terminations of
Employment.

                 

                 (1)           Except
as set forth in clause (A) above or as otherwise determined by the Committee,
the number of shares of Stock which may be purchased upon the exercise of an
Option granted to an employee shall not exceed the number of shares of Stock as
to which such Option was exercisable pursuant to the Plan and the Option
Agreement as of the Termination Date.

                 

                 (2)           If
the Grantee’s cessation of employment occurred as a result of the Grantee’s
Disability or Retirement, unless otherwise expressly provided in the Option
Agreement, the Option shall remain exercisable for a period of twelve (12)
months following the Termination Date (or, if shorter, the remainder of the
Option term as set forth in the Option Agreement).  Except as
otherwise set forth in this Section 7(f) or in the Option Agreement, an Option
granted to an employee shall remain exercisable for three (3) months (or, if
shorter, the remainder of the Option term as set forth in the Option Agreement)
following the Termination Date.  For purposes of this clause (B)(2)
only, an employee who continues to provide services to the Company as a
non-employee director of the Company or as a consultant to the Company following
termination of his employment by the Company or its subsidiary shall be deemed
to continue to be an employee of the Company for the period of such provision of
services or consultancy.

                 

                (C)           Certain Definitions used
herein.  The term “Retirement” as used herein shall mean an
employee’s retirement in good standing under the Company’s established rules and
policies then in effect as determined by the Committee. The term “Disability” as
used herein shall have the meaning ascribed to “permanent and total disability”
as set forth in Section 22(e)(3) of the Code.

                 

                (iii)           Termination of Consultant
Options. Except as otherwise expressly provided in the Option Agreement,
in the event of a cessation of service of a consultant, the number of shares of
Stock which may be purchased upon the exercise of an Option shall not exceed the
number of shares of Stock as to which such Option was exercisable pursuant to
the Plan and the Option Agreement as of the Termination Date.  Except
as otherwise set forth in the Option Agreement, an Option granted to a
consultant shall remain exercisable for a period of three (3) months following
the Termination Date (or, if shorter, the remainder of the Option term as set
forth in the Option Agreement).

                 

                (iv)           Termination of Non-Employee
Director Options.  Unless otherwise expressly provided in the
Option Agreement, the number of shares of Stock which may be purchased upon the
exercise of an Option granted to a non-employee director shall not exceed the
number of shares of Stock as to which such Option was exercisable pursuant to
the Plan and the Option Agreement as of the Termination Date.  An
Option exercisable in accordance with the previous sentence shall remain
exercisable for three (3) months (or, if shorter, the remainder of the Option
term as set forth in the Option Agreement) following the Termination
Date.

                 

                (v)           Other
Limitations.  Notwithstanding any other provisions of this
Plan, specifically including Sections 7(f) and 9(f), if the Committee finds by a
majority vote after full consideration of the facts that a Grantee, before or
after termination of his service with the Company or any of its subsidiaries for
any reason (a) committed or engaged in fraud, embezzlement, theft, commission of
a felony, or proven dishonesty in the course of his employment by the Company or
any of its subsidiaries, which conduct damaged the Company or any of its
subsidiaries, or disclosed trade secrets of the Company or any of its
subsidiaries, or (b) participated, engaged in or had a material financial, or
other interest, whether as an employee, officer, director, consultant,
contractor, stockholder, owner, or otherwise, in any commercial endeavor in the
United States which is competitive with the business of the Company or any of
its subsidiaries without the written consent of the Company or such subsidiary,
the Grantee shall forfeit all outstanding Options and all outstanding Awards,
including all exercised Awards pursuant to which the Company has not yet
delivered evidence of the shares. Clause (b) shall not be deemed to have been
violated solely by reason of a Grantee’s ownership of stock or securities of any
publicly owned corporation, if that ownership does not result in effective
control of the corporation.  In addition to the foregoing, the
Committee may impose such other limitations and restrictions on the exercise of
an Award following the Termination Date as it deems
appropriate.

                
                  
                     

                  

                  
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                                                The
decision of the Committee as to the cause of an employee’s discharge, the damage
done to the Company or its subsidiary, and the extent of a Grantee’s competitive
activity shall be final. No decision of the Committee, however, shall affect the
finality of the discharge of the employee by the Company or its subsidiary in
any manner.

                 

                8.           Terms and Conditions of Stock
Appreciation Rights.  The Committee may in its discretion grant
a right to receive the appreciation in the Fair Market Value of shares of Stock
(a “Stock Appreciation Right” or “SAR”), which shall be subject to the following
terms and conditions and such other terms and conditions as the Committee may
prescribe:

                 

                (a)           Form of
SAR.  Each SAR granted pursuant to the Plan shall be evidenced
by an agreement (the “SAR Agreement”) which shall be in such form as the
Committee shall from time to time approve.  SARs may be granted alone
(a “Freestanding SAR”) or in combination with an Option (a “Tandem
SAR”).

                 

                (b)           Grant and Term of
SARs.  The term of each Freestanding SAR shall be for a maximum
of ten years from the date of granting thereof, but may be for a lesser period
or be subject to earlier termination as provided by the Committee or the
provisions of the Plan or SAR Agreement.  Any Tandem SAR must be
granted at the same time as the related Option is granted, and such Tandem SAR
or applicable portion thereof shall terminate and no longer be exercisable upon
the termination or exercise of the related Option, except that a Tandem SAR
granted with respect to less than the full number of shares of Stock covered by
the related Option shall not be reduced until the number of shares of Stock then
issuable upon exercise of the related Option is equal to or less than the number
of shares of Stock covered by the Tandem SAR.

                 

                (c)           SAR Exercise
Price.  Each SAR Agreement shall state a per share exercise
price, which shall be not less than 100% of the Fair Market Value of a share of
Stock on the date of the SAR grant.

                 

                (d)           Exercise and Value of
SARs.  An SAR may be exercised from time to time to the extent
it is then exercisable in accordance with its terms.  Upon exercise of
a Freestanding SAR, the holder will be entitled to receive an amount in cash or
shares of Stock, as set forth in the SAR Agreement, equal to the excess of the
Fair Market Value of a share of Stock on the date of the exercise less the
exercise price, multiplied by the number of shares of Stock covered by such
Freestanding SAR.  Upon the exercise of a Tandem SAR, the holder may
surrender any related Option or portion thereof which is then exercisable and
elect to receive in exchange therefor cash or shares of Stock, as set forth in
the SAR Agreement, in an amount equal to the excess of the Fair Market Value of
such share of Stock on the date of the exercise less the exercise price,
multiplied by the number of shares of Stock covered by the related Option or the
portion thereof which is so surrendered.  Any Option related to a
Tandem SAR shall no longer be exercisable to the extent the related Tandem SAR
has been exercised.  No fractional shares of Stock shall be issued
hereunder.  The holder of an SAR shall not have any rights as a
stockholder with respect to the Stock covered by the SAR, unless and until
shares of Stock are issued to the Grantee upon the exercise of such
SAR.

                 

                (e)           Payment of Stock
Appreciation Right.  Payment of an SAR shall be in the form of
shares of Stock, cash or any combination of shares of Stock and cash. The form
of payment upon exercise of such a right shall be determined by the Committee
either at the time of grant of the SAR or at the time of exercise of the
SAR.  All shares of Stock issued upon the exercise of an SAR shall be
valued at the Fair Market Value of such Stock at the time of the exercise of the
SAR.

                 

                (f)           Transfer of
SARs.  All SARs shall be subject to the same restrictions on
transfer as are applicable to Options pursuant to Section 7(e).  Any
attempt to transfer an SAR other than as permitted under the Plan shall
terminate the SAR and all rights of the Grantee to that SAR.

                 

                (g)           Termination of
Employment.  Unless otherwise expressly provided in the SAR
Agreement, the terms and conditions relating to the treatment of Options
following cessation of service set forth in Section 7(f) shall apply to SARs,
and the holders of SARs shall have the same rights and be subject to the same
restrictions and limitations as Grantees pursuant to such Section.

                 

                (h)           No Dividends or Dividend
Equivalents.  Notwithstanding anything to the contrary herein,
no dividends or dividend equivalents will be payable with respect to outstanding
SARs.

                
                  
                     

                  

                  
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                9.           Terms and Conditions of Stock
Grants.  The Committee may in its discretion grant Stock
Grants, which shall be made subject to the following terms and conditions and
such other terms and conditions as the Committee may prescribe:

                 

                (a)           Form of
Grant.  Each Stock Grant shall be evidenced by an agreement
(the “Restricted Stock Agreement”) executed by the Company and the Grantee, in
such form as the Committee shall approve, which Agreement shall be subject to
the terms and conditions set forth in this Section 9 and shall contain such
additional terms and conditions not inconsistent with the Plan as the Committee
shall prescribe.

                 

                (b)           Number of Shares Subject to
an Award; Consideration.  The Restricted Stock Agreement shall
specify the number of shares of Stock subject to the Stock Grant.  A
Stock Grant shall be issued for such consideration as the Committee may
determine appropriate and may be issued for no cash consideration or for such
minimum cash consideration as may be required by applicable law.

                 

                (c)           Conditions.  Each
Stock Grant shall be subject to such conditions as the Committee shall establish
(the “Conditions”), which may include, but not be limited to, conditions which
are based upon the continued service of the Grantee over a specified period of
time, or upon the attainment by the Company of one or more measures of the
Company’s operating performance, such as increases in cash flows, net profits,
Stock price, Company, segment or affiliate sales, market share, earnings per
share, return on assets, or return on stockholder equity or, except in the case
of persons who are “covered employees” within the meaning of Section 162(m) of
the Code, such other measures as may be determined by the Committee (the
“Performance Conditions”), or upon a combination of such
factors.  Measures of operating performance may be based upon the
performance of the Company or upon the performance of a defined business unit or
function for which the Grantee has responsibility or over which the Grantee has
influence.  The Grantee shall have a vested right to the Stock subject
to the Stock Grant to the extent that the Conditions applicable to such Stock
Grant have been satisfied.  A Grantee shall forfeit all of his right,
title and interest in and to any Stock subject to a Stock Grant in the event
that (and to the extent that) such Conditions are not satisfied.

                 

                (d)           Special rules relating to
Stock Grants subject to Performance Conditions.

                 

                (i)           The
Committee may award Stock Grants to employees or consultants subject to
satisfaction of specified performance goals established by the Committee. The
terms and provisions relating to these performance-based awards are intended to
satisfy Section 162(m) of the Code and the regulations issued thereunder. The
designation of an employee or consultant eligible for a specific performance
based Stock Grant shall be made by the Committee in writing prior to the
beginning of the period for which the performance is measured (or within such
period as permitted by IRS regulations). The Committee shall establish the
maximum number of shares of Stock to be issued to a designated employee or
consultant if the performance goal or goals are met.  Except with
respect to persons who are “covered employees” within the meaning of Section
162(m) of the Code, the Committee reserves the right to make downward
adjustments in the maximum amount of an Award if in its discretion unforeseen
events make such adjustment appropriate.

                 

                (ii)           The
Committee must certify in writing that a performance goal has been satisfied
prior to the vesting of Stock under any Stock Grant subject to Performance
Conditions.  If the Committee certifies the entitlement of an employee
or consultant to the Stock underlying such a Stock Grant, evidence thereof will
be delivered to such employee or consultant as soon as administratively
practicable, and subject to other applicable provisions of the Plan, including
but not limited to, all legal requirements and tax withholding.

                 

                (e)           Limitations on
Transferability.  As used herein, the term “Restricted Period”
means, with respect to any shares of Stock subject to a Stock Grant, the period
beginning on the Award Date and ending on the date on which the Conditions
applicable to the Stock Grant have been met.  During the Restricted
Period, Stock Grants shall not be transferable other than by will or the laws of
descent and distribution, and during the lifetime of the Grantee, the Grantee
will not be permitted to sell, transfer, exchange, pledge, assign or otherwise
dispose of any shares of Stock subject to the Stock Grant (except for shares of
Stock as to which the Grantee’s rights have vested).  Any attempt to
transfer a Stock Grant other than as permitted under the Plan shall terminate
the Stock Grant and all rights of the Grantee to that Stock Grant.

                 

                
                  
                    
                    

                  

                  
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                (f)           Cessation of
Service

                (i)           Death of Employee
Grantee.  In the event of a Termination Date during the
Restricted Period as a result of an employee’s death, all remaining time-based
restrictions shall be accelerated and be deemed to have been satisfied as of the
Termination Date, and all stock underlying a Stock Grant subject to Performance
Conditions which have not been satisfied shall be forfeited and shall be retired
by the Company and resume the status of treasury shares as of the Termination
Date.

                 

                (ii)           Other Cessations of
Service.  Upon a cessation of service during the Restricted
Period for any reason other than as set forth in Section 9(f)(i) above, all
shares of Stock subject to a Stock Grant as to which the Conditions have not
lapsed or been satisfied or waived shall be forfeited by the Grantee and shall
be retired by the Company and shall resume the status of treasury shares as of
the Termination Date.  In the event of a Grantee’s cessation of
service for any reason, including as a result of a Grantee’s death, the
Committee may, in its sole discretion when it finds that such an action would be
in the best interests of the Company, accelerate or waive in whole or in part
any or all time-based or continuous service Conditions or Performance Conditions
with respect to all or part of such Grantee’s Stock Grant, except as to any
Stock Grant that is intended to constitute “performance-based compensation”
under Section 162(m) of the Code, and provided the Committee may not exercise
such discretion in connection with a termination of service for gross
misconduct, including without limitation, violations of applicable Company
policies or legal or ethical standards.

                 

                (g)           Rights as a
Stockholder.  Except as otherwise provided herein or as the
Committee may otherwise determine, a Grantee of a Stock Grant shall have all of
the rights of a stockholder of the Company, including the right to vote the
shares subject to a Stock Grant and to receive dividends and other distributions
thereon, provided that distributions in the form of stock shall be subject to
all of the terms and conditions of the Plan and the Restricted Stock
Agreement.

                 

                10.         Changes in Capitalization,
Dissolution and Change in Control.

                 

                (a)           Changes in
Capitalization.  In the event of a
change in the outstanding stock of the Company (including but not limited to
changes in either the number of shares or the value of shares) by reason of any
stock split, reverse stock split, dividend or other distribution (whether in the
form of shares, other securities or other property, but not including regular
cash dividends), extraordinary cash dividend, recapitalization, merger in which
the stockholders of the Company immediately prior to the merger continue to own
a majority of the voting securities of the successor entity immediately after
the merger, consolidation, split-up, spin-off, reorganization, combination,
repurchase or exchange of shares or other securities, or other similar corporate
transaction or event, if the Committee shall determine in its sole discretion
that, in order to prevent dilution or enlargement of the benefits or potential
benefits intended to be made available under the Plan, such transaction or event
equitably requires an adjustment in the aggregate number and/or class of shares
of Stock available under the Plan (including for this purpose the number of
shares of Stock available for issuance under the Plan or limit under Section
6(b)) or in the number, class and/or price of shares of Stock subject to
outstanding Options and/or Awards), such adjustment shall be made by the
Committee and shall be conclusive and binding for all purposes under the
Plan.  A participant holding an outstanding award has a legal right to
an adjustment that preserves without enlarging the value of such award, with the
terms and manner of such adjustment to be determined by the
Committee.

                 

                (b)           Dissolution.  Notwithstanding
any other provision of this Plan or any Award Agreement entered into pursuant to
the Plan, to the extent permitted by applicable law, upon a dissolution of the
Company: (i) all Options and SARs then outstanding under the Plan shall become
fully exercisable as of the effective date of the dissolution; and (ii) all
Conditions of all Stock Grants then outstanding shall be deemed satisfied as of
the effective date of the dissolution.  In addition, the Board may in
its discretion cancel all or any portion of a Grantee’s then outstanding Options
and SARs, and in consideration of such cancellation, shall cause to be paid to
such Grantee pursuant to the plan of dissolution, an amount in cash equal to the
difference between the value of the consideration (as determined by the Board)
received by the stockholders of the Company for a share of Stock under the plan
of dissolution and any applicable exercise price.  Options and SARs
not exercised or cancelled prior to or upon a dissolution shall be
terminated.

                
                  
                     

                  

                  
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                (c)           Change in
Control.

                 

                (i)           If
Awards granted to employees, consultants and non-employee directors pursuant to
the Plan continue to be outstanding following the effective date of a Change in
Control, then in the event of a Qualified Termination (as defined below) of a
Grantee’s employment with the Company or any of its subsidiaries or a cessation
of service with respect to a non-employee director or consultant during the
three (3) year period following the Change in Control and prior to the full
vesting of an Award granted to such Grantee under the Plan prior to the Change
in Control, all outstanding unvested Awards granted to such Grantee prior to the
Change in Control shall immediately become fully vested and exercisable to the
extent permitted by law, notwithstanding any provisions of the Plan or of the
applicable Award Agreement to the contrary.

                 

                (ii)           If
Awards issued pursuant to the Plan do not continue to be outstanding following
the effective date of a Change in Control, then to the extent Awards are not
substituted or replaced with Qualified Substitute Awards, (A) any Options and
SARs not so substituted or replaced shall become fully exercisable as of the
date of the Change in Control; and (B) the Conditions of any Stock Grants not so
substituted or replaced shall be deemed satisfied as of the effective date of
the Change in Control.  In addition, the Board (constituted
immediately prior to the effectiveness of such Change in Control) may in its
discretion cancel all or any portion of a Grantee’s then outstanding Options and
SARs, and in consideration of such cancellation, shall cause to be paid to such
Grantee upon the effectiveness of such Change in Control, an amount in cash
equal to the difference between the value of the consideration (as determined by
the Board) received by the stockholders of the Company for a share of Stock in
the Change in Control and any applicable exercise price.  Options and
SARs described in this clause (ii) that are not substituted or replaced with
Qualified Substitute Awards and are not exercised or cancelled prior to or upon
a Change in Control shall be terminated.

                 

                (iii)           For
the purpose of this Section 10(c), the following terms shall have the following
meanings:

                 

                (A)           A
“Change in Control” shall mean and include the following transactions or
situations:

                 

                 (1)           A
sale, transfer, or other disposition by the Company through a single transaction
or a series of transactions of securities of the Company representing thirty
(30%) percent or more of the combined voting power of the Company’s then
outstanding securities to any “Unrelated Person” or “Unrelated Persons” acting
in concert with one another. For purposes of this definition, the term “Person”
shall mean and include any individual, partnership, joint venture, association,
trust corporation, or other entity (including a “group” as referred to in
Section 13(d)(3) of the Exchange Act). For purposes of this definition, the term
“Unrelated Person” shall mean and include any Person other than the Company, a
wholly-owned subsidiary of the Company, or an employee benefit plan of the
Company; provided however, a sale to underwriters in connection with a public
offering of the Company’s securities pursuant to a firm commitment shall not be
a Change in Control;

                 

                 (2)           A
sale, transfer, or other disposition through a single transaction or a series of
transactions of all or substantially all of the assets of the Company to an
Unrelated Person or Unrelated Persons acting in concert with one
another;

                 

                 (3)           A
change in the ownership of the Company through a single transaction or a series
of transactions such that any Unrelated Person or Unrelated Persons acting in
concert with one another become the “Beneficial Owner,” directly or indirectly,
of securities of the Company representing at least thirty (30%) percent of the
combined voting power of the Company’s then outstanding securities. For purposes
of this definition, the term “Beneficial Owner” shall have the same meaning as
given to that term in Rule 13d-3 promulgated under the Exchange Act, provided
that any pledgee of voting securities is not deemed to be the Beneficial Owner
thereof prior to its acquisition of voting rights with respect to such
securities;

                 

                 (4)           Any
consolidation or merger of the Company with or into an Unrelated Person, unless
immediately after the consolidation or merger the holders of the common stock of
the Company immediately prior to the consolidation or merger are the beneficial
owners of securities of the surviving corporation representing at least fifty
(50%) percent of the combined voting power of the surviving corporation’s then
outstanding securities;

                 

                 (5)           During
any period of two years, individuals who, at the beginning of such period,
constituted the Board of the Company cease, for any reason, to constitute at
least a majority thereof, unless the election or nomination for election of each
new director was approved by the vote of at least two-thirds of the directors
then still in office who were directors at the beginning of such period;
or

                
                  
                     

                  

                  
                    7

                    
                      

                    

                  

                  
                     

                  

                

                 

                 (6)           A
change in control of the Company of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated
under the Exchange Act, or any successor regulation of similar importance,
regardless of whether the Company is subject to such reporting
requirement.

                 

                (B)           A
“Qualified Termination” shall mean:

                 

                 (1)           A
termination by the Company of a Grantee’s employment with the Company or any of
its subsidiaries for any reason other than the Grantee’s death, Disability,
willful misconduct or activity deemed detrimental to the interests of the
Company, provided the Grantee executes a general release in favor of the
Company; or

                 

                 (2)           A
resignation by the Grantee from employment with the Company or any of its
subsidiaries with good reason, which includes (i) a substantial adverse change
in the nature or status of the Grantee’s responsibilities, (ii) a reduction in
the Grantee’s base salary and/or levels of entitlement or participation under
any incentive plan or employee benefit program without the substitution or
implementation of an alternative arrangement of substantially equal value, or
(iii) the Company requiring the Grantee to relocate to a work location more than
fifty (50) miles from his work location prior to the Change in
Control.

                 

                 (3)           A
“Qualified Substitute Award” shall mean an Award which has substantially the
same value and is subject to terms and conditions, including vesting, no less
favorable to the Grantee than the vesting and other terms and conditions for
which such Award was substituted, and which Award provides for immediate vesting
upon a Qualified Termination of the Grantee’s employment by the successor
employer or a cessation of service of a non-employee director or consultant
within the three (3) year period following the date of grant of such Qualified
Substitute Award.

                 

                (d)           No Constraint on Corporate
Action.  Nothing in the Plan shall be construed (i) to
limit or impair or otherwise affect the Company’s right or power to make
adjustments, reclassifications, reorganizations or changes to its capital or
business structure, or to merge or consolidate, dissolve or sell or transfer all
or any part of its business or assets, or (ii) except as provided in Section 13,
to limit the right or power of the Company or any subsidiary to take any action
which such entity deems to be necessary or appropriate.

                 

                (e)           Limitation on Adjustments
under Section 162(m).  Notwithstanding anything to the contrary
in this Section 10, no adjustments shall be made under this Section 10 with
respect to an Award to an employee covered under Section 162(m) of the Code to
the extent such adjustment would cause an Award intended to qualify as
“performance-based compensation” under that Section of the Code to fail to so
qualify.

                 

                11.           Stockholder
Approval.  The Plan is subject to the approval by the
affirmative vote of a majority of the shares of Stock present in person or
represented by proxy at a duly held meeting of the stockholders of the Company
within twelve months after the date of the adoption of the Plan by the Board
(the date of which approval is the “Effective Date”).  No Award
granted under the Plan shall vest or be exercisable prior to the Effective
Date.  If the Effective Date shall not occur on or before February 23,
2010, the Plan and all then outstanding Awards made hereunder shall
automatically terminate and be of no further force and effect.

                 

                12.           Term of Plan.  The
Plan, if approved by the Company’s stockholders, will be effective February 24,
2009.  The Plan shall terminate on February 23, 2019 and no Awards
shall be granted after such date, provided that the Board may at any time
terminate the Plan prior thereto.  Except as provided in Section 10,
the termination of the Plan shall not affect the rights of Grantees under Awards
previously granted to them and all Awards shall continue in full force and
effect after termination of the Plan, except as such Awards may lapse or be
terminated by the terms of the Plan or the Award Agreement.

                 

                13.           Amendment of the
Plan.  The Board shall have complete power and authority to
modify or amend the Plan (including the forms of Award Agreements) from time to
time in such respects as it shall deem advisable; provided, however, that the
Board shall not, without approval by the affirmative vote of a majority of the
shares of Stock present in person or represented by proxy at a duly held meeting
of the stockholders of the Company, (i) increase the maximum number of shares of
Stock which in the aggregate are subject to Awards or which may be granted
pursuant to Options under the Plan (except as provided by Section 10), (ii)
extend the term of the Plan or the period during which Awards may be granted or
exercised, (iii) reduce the Option or SAR exercise price below 100% (110%
in the case of an ISO granted to a 10% Holder) of the Fair Market Value of the
Stock issuable upon exercise of the Option or to which the SAR relates, as
applicable, at the time of the granting thereof, other than to change the manner
of determining the Fair Market Value thereof (consistent with the rules under
Section 409A of the Code), (iv) except as provided by Section 10, increase the
maximum number of shares of Stock for which an employee may be granted an Award
during any calendar year under the Plan pursuant to Section 6(b),
(v) materially increase the benefits accruing to participants under the
Plan, (vi) change the designation or class of employees eligible to receive
Awards under the Plan, or (vii) with respect to Options which are intended to
qualify as ISOs, amend the Plan in any respect which would cause such Options to
no longer qualify for ISO treatment pursuant to the Code.  No
amendment of the Plan shall, without the consent of the Grantee, adversely
affect the rights of such Grantee under any outstanding Award
Agreement.

                
                  
                     

                  

                  
                    8

                    
                      

                    

                  

                  
                     

                  

                

                 

                           The
Plan is intended to comply with the requirements of Section 409A of the Code,
without triggering the imposition of any tax penalty thereunder.  To
the extent necessary or advisable, the Board may amend the Plan or any Award
Agreement to delete any conflicting provision and to add such other provisions
as are required to fully comply with the applicable provisions of Section 409A
of the Code and any other legislative or regulatory requirements applicable to
the Plan.

                 

                14.           Taxes.  The Company
may make such provisions as it deems appropriate for the withholding of any
income, employment or other taxes which it determines is required in connection
with any Award made under the Plan, including requiring the Grantee to make a
cash payment to the Company equal to the Company’s withholding obligation or
deducting such amount from any payment of any kind otherwise due to the
Grantee.  The Company may further require notification from the
Grantee upon any disposition of Stock acquired pursuant to the exercise of
Options granted hereunder.

                 

                15.           Indemnification of the Committee and
the Board. With respect to administration of this Plan, the Company shall
indemnify each present and future member of the Committee and the Board against,
and each member of the Committee and the Board shall be entitled without further
act on his part to indemnity from the Company for, all expenses (including
attorney's fees, the amount of judgments, and the amount of approved settlements
made with a view to the curtailment of costs of litigation, other than amounts
paid to the Company itself) reasonably incurred by him in connection with or
arising out of any action, suit, or proceeding in which he may be involved by
reason of his being or having been a member of the Committee and/or the Board,
whether or not he continues to be a member of the Committee and/or the Board at
the time of incurring the expenses, including, without limitation, matters as to
which he shall be finally adjudged in any action, suit or proceeding to have
been found to have been negligent in the performance of his duty as a member of
the Committee or the Board. However, this indemnity shall not include any
expenses incurred by any member of the Committee and/or the Board in respect of
matters as to which he shall be finally adjudged in any action, suit or
proceeding to have been guilty of gross negligence or willful misconduct in the
performance of his duty as a member of the Committee and/or the Board. In
addition, no right of indemnification under this Plan shall be available to or
enforceable by any member of the Committee and/or the Board unless, within 60
days after institution of any action, suit or proceeding, he shall have offered
the Company, in writing, the opportunity to handle and defend same at its own
expense. This right of indemnification shall inure to the benefit of the heirs,
executors or administrators of each member of the Committee and the Board and
shall be in addition to all other rights to which a member of the Committee
and/or the Board may be entitled as a matter of law, contract, or
otherwise.

                 

                16.           Code References and
Definitions.  Whenever reference is made in the Plan to a
Section of the Code, the reference shall be to such section as it is now in
force or as it may hereafter be amended.  The term “subsidiary” shall
have the meaning given to the term “subsidiary corporation” by Section 424(f) of
the Code.  The terms “Incentive Stock Option” and “ISO” shall have the
meanings given to them by Section 422 of the Code.  The term “10%
Holder” shall mean any person who, for purposes of Section 422 of the Code,
beneficially owns more than 10% of the total combined voting power of all
classes of stock of the Company or of any subsidiary of the
Company.  The term “Grantee” means the holder of an Option, an SAR or
a Stock Grant granted hereunder.  The term “Award Agreement” as used
herein means an Option Agreement, SAR Agreement or Restricted Stock
Agreement.

                
                  
                     

                  

                  
                    9EXHIBIT
10.4

     

    
      
        LORETO
RESOURCES COPRORATION

        

        2008
Equity Incentive Plan

        

        

        Section
1.  Purpose

        

        The
purpose of the Loreto Resources Corporation 2008 Equity Incentive Plan
(the “2008 Plan”) is to attract and retain employees, directors and
consultants, to provide an incentive for them to assist Loreto Resources
Corporation (the “Corporation”) to achieve its  long-range performance
goals, and to enable them to participate in the long-term growth of the
Corporation.

        

        Section
2.  Definitions

        

        
          	
                  (a)

                	
                  “Affiliate”
      means any corporation or any other entity (including, but not limited to,
      partnerships and joint ventures) controlling, controlled by, or under
      common control with the
Corporation.

                

        

        

        
          	
                  (b)

                	
                  “Award”
      means any Option, Stock Appreciation Right, Restricted Stock Unit,
      Restricted Stock or Performance Grant awarded under the
      2008 Plan.

                

        

        

        
          	
                  (c) 

                	
                  “Board”
      means the Board of Directors of the
Corporation.

                

        

        

        
          	
                  (d)

                	
                  “Code”
      means the Internal Revenue Code of 1986, as amended from time to time, and
      the regulations promulgated
thereunder.

                

        

        

        
          	
                  (e)

                	
                  “Committee”
      means the Compensation Committee of the Board, or such other committee of
      not less than two members of the Board appointed by the Board to
      administer the 2008 Plan, provided that the members of such Committee
      must be Non-Employee Directors as defined in Rule 16b-3(b) promulgated
      under the Exchange Act.

                

        

        

        
          	
                  (f)

                	
                  “Common
      Stock” or “Stock” means the Common Stock, par value $0.001 per share, of
      the Corporation.

                

        

        

        
          	
                  (g)

                	
                  “Consultant”
      means any person, including an advisor, engaged by the Corporation or a
      Parent, Subsidiary or Affiliate to render services to such
      entity.

                

        

        

        
          	
                  (h) 

                	
                  “Corporation”
      means Loreto Resources Corporation.

                

        

        

        
          	
                  (i)

                	
                  “Designated
      Beneficiary” means the beneficiary designated by a Participant, in a
      manner determined by the Board, to receive amounts due or exercise rights
      of the Participant in the event of the Participant’s death.  In
      the absence of an effective designation by a Participant, Designated
      Beneficiary shall mean the Participant’s
estate.

                

        

        

        
          	
                  (j)

                	
                  “Director”
      means any member of the Board.

                

        

         

        
          
             

          

          
             

            
              

            

          

          
             

          

        

         

        
          	
                  (k)  

                	
                  “Employee”
      means any person, including Officers and Directors, employed by the
      Corporation or any Parent, Subsidiary or Affiliate of the
      Corporation.  Neither service as a Director nor payment of a
      director’s fee by the Corporation will be sufficient to constitute
      “employment” by the Corporation.

                

        

        

        
          	
                  (l) 

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

                

        

        

        
          	
                  (m)

                	
                  “Fair
      Market Value” means, as of any date, the value of the Common Stock as the
      Board may determine in good faith by reference to the closing price of
      such stock on any established stock exchange or an established securities
      market on the day of determination if the Common Stock is so listed on any
      established stock exchange or an established securities
      market.  If the Common Stock is not listed on any established
      stock exchange or a national market system, the value of the Common Stock
      will be determined as the Board may determine in good
    faith.

                

        

        

        
          	
                  (n)

                	
                  “Incentive
      Stock Option” means an option to purchase shares of Common Stock, awarded
      to a Participant under Section 6, which is intended to meet the
      requirements of Section 422 of the Code or any successor
      provision.

                

        

        

        
          	
                  (o)

                	
                  “Nonqualified
      Stock Option” means an option to purchase shares of Common Stock, awarded
      to a Participant under Section 6, which is not intended to be an Incentive
      Stock Option.

                

        

        

        
          	
                  (p)

                	
                  “Officer”
      means a person who is an officer of the Corporation within the meaning of
      Section 16 of the Exchange Act and the rules and regulations
      promulgated thereunder.

                

        

        

        
          	
                  (q) 

                	
                  “Option”
      means an Incentive Stock Option or a Nonqualified Stock
      Option.

                

        

        

        
          	
                  (r)

                	
                  “Parent”
      means a “parent corporation,” whether now or hereafter existing, as
      defined in Section 424(e) of the
Code.

                

        

        

        
          	
                  (s)

                	
                  “Participant”
      means a person selected by the Board to receive an Award under the
      2008 Plan.

                

        

        

        
          	
                  (t) 

                	
                  “Performance
      Grant” means an award to a Participant under
    Section 9.

                

        

        

        
          	
                  (u)

                	
                  “Restricted
      Period” means the period of time selected by the Board during which an
      award of Restricted Stock may be forfeited to the
    Corporation.

                

        

        

        
          	
                  (v)

                	
                  “Restricted
      Stock” means shares of Common Stock subject to forfeiture, awarded to a
      Participant under Section 8.

                

        

        

        
          	
                  (w)

                	
                  “Restricted
      Stock Unit” or “RSU” means units granted to a Participant that are settled
      in Stock and awarded to a Participant under Section 10.  An RSU
      is a bookkeeping entry representing the equivalent of one share of
      Stock.

                

        

         

         

        
          
             

          

          
            2

            
              

            

          

          
             

          

        

        
 

        
          	
                  (x)

                	
                  “Service
      Provider” means an Employee, Director, or
  Consultant.

                

        

        

        
          	
                  (y)

                	
                  “Stock
      Appreciation Right” or “SAR” means a right to receive any excess in value
      of shares of Common Stock over the reference price, awarded to a
      Participant under Section 7.

                

        

        

        
          	
                  (z)

                	
                  “Subsidiary”
      means a “subsidiary corporation,” whether now or hereafter existing, as
      defined in Section 424(f) of the
Code.

                

        

        

        Section
3.  Administration

        

        The Board shall have the responsibility
to administer the 2008 Plan.  However, the Board may designate
the Committee to administer the 2008 Plan on its behalf.  The
Board, or if designated, the Committee, shall have authority to adopt, alter and
repeal such administrative rules, guidelines and practices governing the
operation of the 2008 Plan as it shall from time to time consider
advisable, and to interpret the provisions of the 2008 Plan.  The
Board’s decisions shall be final and binding.  To the extent permitted
by applicable law and permitted to meet the requirements of Rule 16b-3
promulgated under the Securities Exchange Act, the Board may delegate to the
Committee the power to make Awards to Participants and all determinations under
the 2008 Plan with respect thereto.

        

        Section
4.  Eligibility

        

        All
Employees of the Corporation or any Parent or Subsidiary of the Corporation,
and, in the case of Awards other than Incentive Stock Options, all Service
Providers, capable of contributing significantly to the successful performance
of the Corporation are eligible to be Participants in the
2008 Plan.

        

        Section
5.  Stock
Available for Awards

        

        
          	
                  (a)

                	
                  Subject
      to adjustment under subsection (b), Awards may be made under the
      2008 Plan of up to a maximum of 2,000,000 shares of Common
      Stock.  If any Award in respect of shares of Common Stock
      granted under the 2008 Plan expires, terminates, is terminated
      unexercised or is forfeited for any reason or settled in a manner that
      results in fewer shares outstanding than were initially awarded, including
      without limitation the surrender of shares in payment for the Award or any
      tax obligation thereon, the shares subject to such Award or so
      surrendered, as the case may be, to the extent of such expiration,
      termination, forfeiture or decrease, shall again be available for award
      under the 2008 Plan, subject, however, in the case of Incentive Stock
      Options, to any limitation required under the Code.  Common
      Stock issued through the assumption or substitution of outstanding grants
      from an acquired corporation shall not reduce the shares available for
      Awards under the 2008 Plan.  Shares issued under the
      2008 Plan may consist in whole or in part of authorized but unissued
      shares or treasury shares.

                

        

         

        
          
             

          

          
            3

            
              

            

          

          
             

          

        

        
 

        
          	
                  (b)

                	
                  In
      the event that the Board determines that any stock dividend, extraordinary
      cash dividend, creation of a class of equity securities, recapitalization,
      stock split, reverse stock split, reclassification, reorganization,
      merger, consolidation, split-up, spin-off, liquidation, combination,
      exchange of shares, warrants or rights offering to purchase Common Stock
      at a price substantially below fair market value, or other similar
      transaction affects the Common Stock such that an adjustment is required
      in order to preserve the benefits or potential benefits intended to be
      made available under the 2008 Plan, then the Board, subject, in the
      case of Incentive Stock Options, to any limitation required under Section
      422 of the Code, and with respect to other Awards, any applicable
      requirements of Section 409A of the Code, shall equitably adjust any or
      all of (i) the number and kind of shares in respect of which Awards
      may be made under the 2008 Plan, (ii) the number and kind of
      shares subject to outstanding Awards, and (iii) the award, exercise
      or conversion price with respect to any of the foregoing, and if
      considered appropriate, the Board may make provision for a cash payment
      with respect to an outstanding Award, provided that the number of shares
      subject to any Award shall always be a whole
  number.

                

        

        

        Section
6.  Stock
Options

        

        
          	
                  (a)

                	
                  Subject
      to the provisions of the 2008 Plan, the Board may award Incentive
      Stock Options and Nonqualified Stock Options and determine the number of
      shares to be covered by each Option, the option price therefore and the
      conditions and limitations applicable to the exercise of the
      Option.  The terms and conditions of Incentive Stock Options
      shall be subject to and comply with Section 422 of the Code, or any
      successor provision, and any regulations
  thereunder.

                

        

        

        
          	
                  (b)

                	
                  The
      Board shall establish the option price at the time each Option is awarded,
      which price shall not be less than 100% of the Fair Market Value of the
      Common Stock on the date of award with respect to such
    Option.

                

        

        

        
          	
                  (c)

                	
                  Each
      Option shall be exercisable at such times and subject to such terms and
      conditions as the Board may specify in the applicable Award or
      thereafter.  The Board may impose such conditions with respect
      to the exercise of Options, including conditions relating to applicable
      federal or state securities laws, as it considers necessary or
      advisable.

                

        

        

        
          	
                  (d)

                	
                  No
      shares shall be delivered pursuant to any exercise of an Option until
      payment in full of the option price therefore is received by the
      Corporation.  Such payment may be made in whole or in part in
      cash or, to the extent permitted by the Board at or after the award of the
      Option, by delivery of shares of Common Stock owned by the option holder,
      valued at their Fair Market Value on the date of delivery, by the
      reduction of the shares of Common Stock that the optionholder would be
      entitled to receive upon exercise of the Option, such shares to be valued
      at their Fair Market Value on the date of exercise, less their option
      price (a so-called “cashless exercise”), or such other lawful
      consideration as the Board may
determine.

                

        

        

        
          	
                  (e)

                	
                  In
      the case of Incentive Stock Options the following additional conditions
      shall apply to the extent required under Section 422 of the Code for the
      options to qualify as Incentive Stock
Options:

                

        

         

        
          
             

          

          
            4

            
              

            

          

          
             

          

        

        
 

        
          	
                   
      

                	
                  (i)

                	
                  Such
      options shall be granted only to employees of the Corporation, and shall
      not be granted to any person who owns stock that possesses more than ten
      percent of the total combined voting power of all classes of stock of the
      Corporation or of its parent or subsidiary corporation (as those terms are
      defined in Section 422(b) of the Code), unless, at the time of such grant,
      the exercise price of such option is at least 110% of the fair market
      value of the stock that is subject to such option and the option shall not
      be exercisable more than five years after the date of
    grant;

                

        

        

        
          
            	
                  	
                    (ii) 

                  	
                    Such
      options shall, by their terms, be transferable by the optionholder only by
      the laws of descent and distribution, and shall be exercisable only by
      such optionholder during his
lifetime.

                  

          

        

        

        
          
            	
                  	
                    (iii) 

                  	
                    Such
      options shall not be granted more than ten years from the effective date
      of the 2008 Plan or any subsequent amendment to the 2008 Plan
      approved by the stockholders of the Corporation which extends this
      Incentive Stock Option expiration date, and shall not be exercisable more
      than ten years from the date of
grant.

                  

          

        

        

        
          	
                   
      

                	
                  (iv)

                	
                  Notwithstanding
      other provisions hereof, the aggregate Fair Market Value (determined at
      the time the Incentive Stock Option is granted) of the Common Stock with
      respect to which Incentive Stock Options are exercisable for the first
      time by the employee during any calendar year (under all such plans of the
      employee’s employer corporation and its parent and subsidiary
      corporations) shall not exceed
$100,000.

                

        

        

        Section
7.  Stock
Appreciation Rights

        

        Subject
to the provisions of the 2008 Plan, the Board may award SARs in tandem with
an Option (at or after the award of the Option), or alone and unrelated to an
Option.  The Board shall establish the option price at the time each
SAR is awarded, which price shall not be less than 100% of the Fair Market Value
of the Common Stock on the date of award with respect to SARs.  SARs
granted in tandem with an Option shall terminate to the extent that the related
Option is exercised, and the related Option shall terminate to the extent that
the tandem SARs are exercised.

        

        Section
8.  Restricted
Stock

        

        
          	
                  (a)

                	
                  Subject
      to the provisions of the 2008 Plan, the Board may award shares of
      Restricted Stock and determine the duration of the Restricted Period
      during which, and the conditions under which, the shares may be forfeited
      to the Corporation and the other terms and conditions of such
      Awards.  Shares of Restricted Stock may be issued for no cash
      consideration or such minimum consideration as may be required by
      applicable law.

                

        

         

        
          
             

          

          
            5

            
              

            

          

          
             

          

        

        
 

        
          	
                  (b)

                	
                  Shares
      of Restricted Stock may not be sold, assigned, transferred, pledged or
      otherwise encumbered, except as permitted by the Board, during the
      Restricted Period.  Shares of Restricted Stock shall be
      evidenced in such manner as the Board may determine.  Any
      certificates issued in respect of shares of Restricted Stock shall be
      registered in the name of the Participant and unless otherwise determined
      by the Board deposited by the Participant, together with a stock power
      endorsed in blank, with the Corporation.  At the expiration of
      the Restricted Period, the Corporation shall deliver such certificates to
      the Participant or, if the Participant has died, to the Participant’s
      Designated Beneficiary.

                

        

        

        
          	
                  (c)

                	
                  Holders
      of Restricted Stock shall have the right to receive any dividends declared
      or paid with respect to such Restricted Stock, provided, however that the
      Board may provide that any dividends paid on Restricted Stock must be
      reinvested in shares of Stock, which may or may not be subject to the same
      terms and conditions of such Restricted
Stock.

                

        

        

        Section
9.  Performance
Grants

        

        Subject
to the provisions of the 2008 Plan, the Board may award Performance Grants
to Participants.  The Board shall establish performance goals for the
Awards, including performance criteria, target and maximum amounts payable, and
other terms and conditions, including, if applicable, the provisions of Section
162(m) of the Code.

        

        Section
10.  Restricted Stock
Units

        

        Subject
to the provisions of the 2008 Plan, the Board may award Restricted Stock
Units to Participants.  The Board shall determine criteria for vesting
and the value of each RSU at the time each RSU is awarded, which value shall be
equal to 100% of the Fair Market Value of the Common Stock on the date of award
with respect to RSUs.  If dividends or dividend equivalents are
credited under this Section 10 of the 2008 Plan, such dividends or
dividend equivalents shall be deferred until such time as the RSU is
settled.  RSUs shall be settled in shares of Common
Stock.

        

        Section
11.  General
Provisions Applicable to Awards

        

        
          	
                  (a)

                	
                  Documentation.  Each
      Award under the 2008 Plan shall be evidenced by a written document
      delivered to the Participant specifying the terms and conditions thereof
      and containing such other terms and conditions not inconsistent with the
      provisions of the 2008 Plan as the Board considers necessary or
      advisable to achieve the purposes of the 2008 Plan or comply with
      applicable tax and regulatory laws and accounting
      principles.  If such written document evidences an Award of
      Options, it shall specify whether such Options are intended to be
      Nonqualified Stock Options or Incentive Stock Options, and in the absence
      of such specification such Options shall be deemed Nonqualified Stock
      Options.

                

        

        

        
          	
                  (b)

                	
                  Board
      Discretion.  Each type of Award may be made alone, in
      addition to or in relation to any other type of Award.  The
      terms of each type of Award need not be identical, and the Board need not
      treat Participants uniformly.  Except as otherwise provided by
      the 2008 Plan or a particular Award, any determination with respect
      to an Award may be made by the Board at the time of award or at any time
      thereafter.

                

        

         

        
          
             

          

          
            6

            
              

            

          

          
             

          

        

        
 

        
          	
                  (c)

                	
                  Settlement.  The
      Board shall determine whether Awards, other than Restricted Stock Units,
      are settled in whole or in part in cash, Common Stock, other securities of
      the Corporation, Awards, other property or such other methods as the Board
      may deem appropriate.  If shares of Common Stock are to be used
      in payment pursuant to an Award and such shares were acquired upon the
      exercise of a stock option (whether or not granted under the
      2008 Plan), such shares must have been held by the Participant for at
      least six months.

                

        

        

        
          	
                  (d)

                	
                  Termination of
      Employment.  The Board shall determine the effect on an
      Award of the disability, death, retirement or other termination of
      employment of a Participant and the extent to which, and the period during
      which, the Participant’s legal representative, guardian or Designated
      Beneficiary may receive payment of an Award or exercise rights
      thereunder.

                

        

        

        
          	
                  (e)

                	
                  Change in
      Control.  In order to preserve a Participant’s rights
      under an Award in the event of a change in control of the Corporation, as
      defined in Treasury Regulation Section 1.409A-3(i)(5)(i), the Board
      in its discretion may, at the time an Award is made or at any time
      thereafter, take one or more of the following actions: (i) provide for the
      acceleration of any time period relating to the exercise or realization of
      the Award, (ii) provide for the purchase of the Award upon the
      Participant’s request for an amount of cash or other property that could
      have been received upon the exercise or realization of the Award had the
      Award been currently exercisable or payable, (iii) adjust the terms of the
      Award in a manner determined by the Board to reflect the change in
      control, (iv) cause the Award to be assumed, or new rights
      substituted therefore, by another entity, or (v) make such other provision
      as the Board may consider equitable and in the best interests of the
      Corporation.  Notwithstanding the foregoing, any change in
      Incentive Stock Options shall comply with the rules under Section 424 of
      the Code and no change may be made to any Award which would make the Award
      subject to the provisions of Section 409A of the
  Code.

                

        

        

        
          	
                  (f)

                	
                  Withholding.  The
      Corporation shall have the power and the right to deduct or withhold, or
      require a Participant to remit to the Corporation an amount sufficient to
      satisfy federal, state and local taxes (including the Participant’s FICA
      obligation) required to be withheld with respect to an Award or any
      dividends or other distributions payable with respect
      thereto.  In the Board’s discretion, such tax obligations may be
      paid in whole or in part in shares of Common Stock, including shares
      retained from the Award creating the tax obligation, valued at their Fair
      Market Value on the date of delivery.  The Corporation may, to
      the extent permitted by law, deduct any such tax obligations from any
      payment of any kind otherwise due to the
  Participant.

                

        

        

        
          	
                  (g)

                	
                  Amendment of
      Award.  The Board may amend, modify or terminate any
      outstanding Award, including substituting therefore another Award of the
      same or a different type, changing the date of exercise or realization and
      converting an Incentive Stock Option to a Nonqualified Stock Option,
      provided that the Participant’s consent to such action shall be required
      unless the Board determines that the action, taking into account any
      related action, would not materially and adversely affect the
      Participant.

                

        

         

        
          
             

          

          
            7

            
              

            

          

          
             

          

        

        
 

        
          	
                  (h)

                	
                  Transfer.  Except
      as otherwise provided by the Board, Awards under the 2008 Plan are
      not transferable other than as designated by the Participant by will or by
      the laws of descent and
distribution.

                

        

        

        
          	
                  (i)

                	
                  Compliance with
      Section 409A of the Code.  To the extent applicable, the
      2008 Plan is intended to be operated in good faith compliance with
      the requirements of Section 409A of the Code and its accompanying
      regulations, and any additional guidance issued under Section
      409A.  To the extent that any provision of the 2008 Plan
      violates Section 409A, such provision shall be deemed inoperative and the
      remaining provisions of the 2008 Plan shall continue to be fully
      effective.

                

        

        

        Section
12.  Miscellaneous

        

        
          	
                  (a)

                	
                  No Right to
      Employment.  No person shall have any claim or right to
      be granted an Award, and the grant of an Award shall not be construed as
      giving a Participant the right to continued employment.  The
      Corporation expressly reserves the right at any time to dismiss a
      Participant free from any liability or claim under the 2008 Plan,
      except as expressly provided in the applicable
  Award.

                

        

        

        
          	
                  (b)

                	
                  No Rights as
      Shareholder.  Subject to the provisions of the applicable
      Award, no Participant or Designated Beneficiary shall have any rights as a
      shareholder with respect to any shares of Common Stock to be distributed
      under the 2008 Plan until he or she becomes the holder
      thereof.  A Participant to whom Common Stock is awarded shall be
      considered the holder of the Stock at the time of the Award except as
      otherwise provided in the applicable
Award.

                

        

        

        
          	
                  (c)

                	
                  Effective Date and
      Duration of the 2008 Plan.  The 2008 Plan was adopted by
      the Board and stockholders of the Corporation and became effective on July
      __, 2008.  Unless earlier terminated by the Board, the 2008 Plan
      shall terminate on July__, 2017.

                

        

        

        
          	
                  (d)

                	
                  Amendment of
      2008 Plan.  The Board may amend, suspend or
      terminate the 2008 Plan or any portion thereof at any time, without
      shareholder approval, provided that no amendment shall be made without
      shareholder approval if such approval is necessary to comply with any
      applicable requirement of the laws of the jurisdiction of incorporation of
      the Corporation, any applicable tax requirement, including
      Section 422 of the Code, any applicable rules or regulation of the
      Securities and Exchange Commission, including Rule 16b-3 (or any
      successor rule thereunder), or the rules and regulations of The Nasdaq
      Stock Market, Inc. or any other exchange or stock market over which the
      Corporation’s securities are listed.  No amendment shall be made
      where such amendment increases the total number of shares of Common Stock
      reserved for issuance of Awards or reduced the minimum exercise price for
      options or exchange of options for other Awards, unless such change is
      authorized by the shareholders within one
year.

                

        

         

        
          
             

          

          
            8

            
              

            

          

          
             

          

        

        
 

        
          	
                  (e)

                	
                  Governing
      Law.  The provisions of the 2008 Plan shall be
      governed by and interpreted in accordance with the laws of the
      jurisdiction of incorporation of the
  Corporation.

                

        

        

        
          	
                  (f)

                	
                  Indemnity.  Neither
      the Board nor the Committee, nor any members of either, nor any employees
      of the Corporation or any parent, subsidiary, or other affiliate, shall be
      liable for any act, omission, interpretation, construction or
      determination made in good faith in connection with their responsibilities
      with respect to the 2008 Plan, and the Corporation hereby agrees to
      indemnify the members of the Board, the members of the Committee, and the
      employees of the Corporation and its parent or subsidiaries in respect of
      any claim, loss, damage, or expense (including reasonable counsel fees)
      arising from any such act, omission, interpretation, construction or
      determination to the full extent permitted by
  law.

                

        

      

    

     

     

     

     

     

    
      
         

      

      
        9

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