Document:

EXHIBIT
      10.14

    

    SUBORDINATED
      REVOLVING 

    LINE
      OF CREDIT AGREEMENT

     

    This
      Subordinated Revolving Line of Credit Agreement dated as of ______, 2007 (this
      “Agreement”)
      is
      entered into by and between FMG Acquisition Corp., a Delaware corporation
      (“Borrower”),
      and
      FMG Investors LLC, a Connecticut limited liability company (“Lender”),
      with
      reference to the following facts. 

     

    (a)  Borrower
      has been organized for the purpose of effecting a merger, capital stock
      exchange, asset acquisition or other similar business combination with an
      operating business (a “Business
      Combination”).
      

     

    (b)  Borrower
      proposes to: (a) make a public offering (the “Public
      Offering”)
      of its
      securities pursuant to a registration statement (the “Registration
      Statement”)
      filed
      with and to be declared effective by the Securities and Exchange Commission
      (the
“SEC”);
      (b) deposit the proceeds from the Public Offering into a trust account (the
“Trust
      Account”)
      for
      the benefit of the purchasers of securities in the Public Offering, net of
      offering costs, underwriting discounts and $1,200,000 of interest earned on
      such
      proceeds, together with $100,000 to be held outside of the Trust Account, to
      be
      used for general corporate purposes (such $1,300,000, the “Non-Trust Funds”), to
      be held and disbursed in accordance with the terms of the Investment Management
      Trust Agreement to be entered into between Borrower and Continental Stock
      Transfer & Trust Company as trustee (the “Trust
      Agreement”);
      and
      (c) utilize the funds in the Trust Account in connection with a Business
      Combination. 

     

    (c)  
      Borrower may need funds (i) to pay costs and expenses prior to consummation
      of a
      Business Combination or (ii) to pay costs, expenses and claims in connection
      with Borrower’s dissolution and the liquidation of Borrower and the Trust
      Account to its public stockholders.

     

    (d)  On
      the terms and subject to the conditions set forth in this Agreement, Lender
      is
      willing to make available to Borrower a revolving line of credit to pay certain
      costs and expenses that may arise prior to a Business Combination or to pay
      costs, expenses and claims in connection with Borrower’s dissolution and the
      liquidation of the Trust Account to its public stockholders (the “Loan”).
      

      

    1.  The
      Loan 

     

    1.1  If
      the Non-Trust Funds are insufficient for the Borrower’s working capital purposes
      (including the payment of costs, expenses and claims in connection with
      Borrower’s dissolution and the liquidation of Borrower and the distribution of
      the Trust Account to its public stockholders), then Lender agrees to make
      advances to Borrower, and Borrower agrees to repay such advances, from time
      to
      time in accordance with the terms and conditions of this Agreement and the
      form
      of revolving promissory note attached hereto as Exhibit A (the
“Note”);
      provided, however, that notwithstanding anything to the contrary in this
      Agreement, at no time shall the aggregate of all advances and readvances
      outstanding under the Loan at any time exceed $250,000.

    

    This
      Agreement and the Note are each sometimes referred to in this Agreement
      individually as a “Loan
      Document,”
and
      are sometimes collectively referred to as the “Loan
      Documents.”
      

     

    
      	
              1.2  Lender’s
                obligation to make advances shall expire upon the first to occur
                of the
                following:

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    1.2.1  Upon
      a material breach or default of any representation, warranty or agreement of
      Borrower that is not cured or corrected within 20 days of notice of such breach
      from Lender; 

     

    1.2.2
      Upon consummation of a Business Combination;

     

    1.2.3  If
      no Business Combination is consummated, after the completion of the liquidation
      of the Trust Account and Borrower’s completed and fully implemented dissolution
      and distribution

     

    1.2.4
      Thirty days after Borrower provides written notice to Lender of its termination
      of this Agreement and the Loan facility, and the payment of all amounts due
      hereunder to Lender. 

     

    2.  Conditions
      of Advances.  Upon
      reasonable advance request from Borrower, Lender shall make advances to or
      as
      directed by Borrower, provided that each and all of the following conditions
      is
      satisfied: 

     

    
      2.1
        Borrower shall have executed and delivered the Note to Lender, as
        applicable;

       

      2.2
        The
        aggregate amount of outstanding advances following such advance shall not
        exceed
        $250,000;

       

      2.3  The
        representations and warranties of Borrower in the Loan Documents shall be
        true
        and correct in all material respects; 

       

      2.4
        Borrower shall have complied in all material respects with each of its
        agreements in the Loan Documents;

       

      2.5
        The
        advances shall be used only for such purposes as are set forth in Section
        4.1 of
        this Agreement; and

       

      2.6
        Borrower shall have completed the Public Offering.

    

     

    3.  Borrower
      Representations 

     

    
      	
              3.1  Borrower
                represents and warrants as follows:

            

    

     

    3.1.1  Borrower
      has full power and authority to execute and deliver this Agreement and the
      other
      Loan Documents to be executed and delivered by it pursuant hereto and to perform
      its obligations hereunder and thereunder. This Agreement and such Loan Documents
      constitute the valid and legally binding obligations of the Borrower and are
      enforceable against Borrower in accordance with their terms. 

     

    3.1.2  Neither
      the execution and the delivery of the Loan Documents by Borrower, nor the
      consummation of the transactions contemplated by the Loan Documents,
      nor the borrowing by Borrower, will (a) violate any constitution,
      statute, regulation, rule, injunction, judgment, order, decree, ruling, charge,
      or other restriction of any government, governmental agency, or court to which
      Borrower is subject or any provision of the Amended and Restated Certificate
      of
      Incorporation or Bylaws of Borrower, or (b) conflict with, result in a
      breach of, constitute a default under, result in the acceleration of, create
      in
      any entity or natural person (each, a “Person”)
      the
      right to accelerate, terminate, modify, or cancel, any agreement, contract,
      lease, license, instrument, or other arrangement to which Borrower is a party
      or
      by which it is bound or to which any of its assets are subject (or result in
      the
      imposition of any security interest upon any of its assets), in each case other
      than where such violation, conflict, breach, default, acceleration or creation
      of right would not reasonably be expected to have a material adverse effect
      on
      the ability of Borrower to repay amounts due under the Note in accordance with
      the terms of the Loan Documents. (a “Material
      Adverse Effect”).
      

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    3.1.3  Borrower
      does not need to give any notice to, make any filing with, or obtain any
      authorization, permit, certificate, registration, consent, approval or order
      of
      any government or governmental agency in order for the parties to consummate
      the
      transactions contemplated by this Agreement, except where the failure would
      not
      reasonably be expected to have a Material Adverse Effect. 

     

    3.1.4  The
      conditions to the obligation of Lender to make the advance, as set forth in
      Section 2, shall be satisfied. 

     

    3.2  Each
      and every representation and warranty made by Borrower in this Agreement shall
      be deemed renewed and remade upon the making of each and every advance or
      readvance under the Note that Lender may make. 

     

    4.  Borrower
      Covenants.  For
      as long as Lender shall have a commitment to make advances or there shall be
      any
      outstanding balance on the Loan, without the prior consent of Lender, Borrower
      shall: 

     

    4.1  use
      the proceeds of any advance made hereunder only for (i) ordinary and reasonable
      operating costs and expenses during the period Borrower seeks to identify,
      investigate, negotiate and consummate a Business Combination, including
      Borrower’s reporting obligations with the SEC, the audit and review of
      Borrower’s financial statements, identifying and investigating potential targets
      for a Business Combination, deposits, down payments or funding of “no-shop”
provisions in connection with a particular Business Combination, negotiating
      and
      closing the Business Combination, legal and other professional fees and
      expenses, fees, salaries and compensation for directors, officers, employees,
      consultants and advisors, and insurance premiums or (ii) to pay claims of
      vendors, prospective target businesses or other entities related to 4.1(i)
      and
      any costs or expenses incurred in connection with Borrower’s dissolution and the
      liquidation of Borrower and the distribution of the Trust Account to its public
      stockholders; 

     

     
      4.2  not declare or pay any dividend or distribution with respect to,
      or repurchase or redeem any shares of, the capital stock of Borrower, provided
      that this shall not prohibit payments from the Trust Account to stockholders
      of
      Borrower in accordance with the Trust Agreement; 

     

    4.3  not
      engage in any business other than identifying, investigating, negotiating and
      closing a Business Combination; 

     

    4.4  not
      make any material capital expenditure or purchase any material property or
      asset
      (other than office supplies and equipment); and 

     

    4.5  upon
      request of Lender, provide to Lender copies of all filings with the Securities
      and Exchange Commission. 

    

    5.  No
      Recourse to Trust Account 

     

    Lender,
      on behalf of itself and its successors and assigns, hereby acknowledges and
      agrees that under no circumstance shall Lender have any right, title or interest
      in or to any of the funds in the Trust Account, notwithstanding the fact that
      such funds were received for the purchase and sale of securities of Borrower,
      or
      any funds distributed from the Trust Account other than in a Business
      Combination Distribution (as defined below), and that their sole recourse for
      repayment of any and all amounts due under the Note shall be against the assets
      or properties of Borrower never deposited into the Trust Account or distributed
      to Borrower from the Trust Account in a Business Combination Distribution.
      Lender hereby irrevocably waives any claim it might have to funds in the Trust
      Account, and any funds distributed from the Trust Account other than in a
      Business Combination Distribution, at law or in equity, agree not to make any
      such claim, and agree to indemnify and hold Borrower harmless from any such
      claim made by or on behalf of Lender. For purposes of this Section 5, a
“Business
      Combination Distribution”
means
      a
      distribution from the Trust Account in connection with the consummation of
      a
      Business Combination pursuant to the Trust Agreement. 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    6.  Events
      of Default.  The
      occurrence of any of the following shall constitute an event of default (an
      “Event
      of Default”)
      hereunder and under each and every other Loan Document: 

     

    6.1  The
      Borrower shall fail to pay any principal or any other amount as and when due
      and
      payable under any Loan Document; 

     

    6.2  Any
      representation or warranty which is made or deemed made in any Loan Document
      by
      the Borrower shall prove to have been incorrect or misleading in any material
      respect on or as of the date made or deemed made or remade; 

     

    6.3  The
      Borrower shall fail to perform or observe any term, provision, covenant, or
      agreement contained in any Loan Document to be performed or observed by the
      Borrower (other than any payment obligation) and such failure shall continue
      more than 20 days after notice thereof from Lender; 

     

    6.4  The
      Borrower shall (a) generally not, or be unable to, or admit in writing its
      inability to, pay its debts as such debts become due, only after the Company
      has
      borrowed the entire $250,000 pursuant hereto; or (b) make an assignment for
      the benefit of creditors, or petition or apply to any tribunal for the
      appointment of a custodian, receiver, or trustee for it or a substantial part
      of
      its assets; or (c) commence any proceeding under any bankruptcy,
      reorganization, arrangement, readjustment of debt, dissolution, or liquidation
      law or statute of any jurisdiction, whether now or hereafter in effect; or
      (d) have any such petition or application filed or any such proceeding
      commenced against it in which an order for relief is entered or adjudication
      or
      appointment is made and which remains undismissed for a period of 30 days or
      more; or (e) by any act or omission to act indicate consent to, approval
      of, or acquiescence in any such petition, application, or proceeding, or order
      for relief, or the appointment of a custodian, receiver or trustee for all
      or
      any such substantial part of its properties; or (f) suffer any such
      custodianship, receivership, or trusteeship for all or any substantial part
      of
      its properties; or (g) suffer any such custodianship, receivership, or
      trusteeship to continue undischarged for a period of 30 days or more;
provided,
      however,
      that
      the adoption of a plan of dissolution and distribution and its implementation
      by
      the Borrower’s Board of Directors due to the failure of Borrower to complete a
      Business Combination shall not in any instance be deemed an Event of Default
      hereunder; or

      

    6.5  At
      any time after execution and delivery of this Agreement, and whether or not
      due
      to any fault of Lender, any Loan Document shall cease to be in full force and
      effect and enforceable in accordance with its terms, or shall be declared null
      and void. 

     

    7.  Consequences
      of Default.  If
      an Event of Default shall occur, Lender: 

     

    
      7.1
        shall
        have no further obligation to make advances under the Loan Documents;
        and
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    7.2  may
      declare the Note and all amounts payable under this Agreement and any other
      Loan
      Document to be forthwith due and payable, whereupon the Note and all such
      amounts shall become and be forthwith due and payable, without presentment,
      demand, protest, or further notice of any kind, all of which are hereby
      expressly waived by Borrower. 

    

     

    8.  Miscellaneous
      Provisions 

     

    8.1  Notices.  All
      notices, requests, demands and other communications (collectively, “Notices”)
      given
      pursuant to this Agreement shall be in writing, and shall be delivered by
      personal service, courier, facsimile transmission or by United States first
      class, registered or certified mail, addressed to the following addresses:
      

    

    
      	
              If
                to Borrower: 

            	
               

            	
              FMG
                Acquisition Corp.

            
	
               
                

            	
               

            	
              Four
                Forest Park

            
	
               
                

            	
               

            	
              Famington,
                CT 06032

            
	
               
                

            	
               

            	
              Facsimile:
                (860)
                674-1163

            
	
               

            	
               

            	
               

            
	
              If
                to Lender: 

            	
               

            	
              FMG
                Investors LLC

            
	
               
                

            	
               

            	
              Four
                Forest Park

            
	
               
                

            	
               

            	
              Famington,
                CT 06032

            
	
               
                

            	
               

            	
              Facsimile:
                (860)
                674-1163 

            

    

         

    Any
      Notice, other than a Notice sent by registered or certified mail, shall be
      effective when received; a Notice sent by registered or certified mail, postage
      prepaid return receipt requested, shall be effective on the earlier of when
      received or the third day following deposit in the United States mails (or
      on
      the seventh day if sent to or from an address outside the United States). Any
      party may from time to time change its address for further Notices hereunder
      by
      giving notice to the other party in the manner prescribed in this Section.
      

     

    8.2  No
      Waivers; Remedies Cumulative.
      No
      failure or delay by a party in exercising any right, power or privilege
      hereunder shall operate as a waiver thereof, nor shall any single or partial
      exercise thereof preclude any other or further exercise thereof or the exercise
      of any other right, power or privilege. The rights and remedies provided herein
      shall be cumulative and not exclusive of any rights or remedies provided by
      law.

     

    8.3  Amendments
      and Waivers.
      Any
      provision of this Agreement may be amended or waived if, but only if, such
      amendment or waiver is in writing and is signed by Borrower and Lender.

     

    8.4  Successors
      and Assigns.
      Borrower may not assign its right or duties hereunder without the prior written
      consent of Lender, which consent Lender may deny, withhold or delay in its
      sole
      and absolute discretion. 

     

    8.5  Governing
      Law.
      This
      Agreement has been made and entered into in the State of Delaware and shall
      be
      construed in accordance with the laws of the State of Delaware without giving
      effect to the principles of conflicts of law thereof.

     

    8.6  Prior
      Understandings.
      This
      Agreement supersedes all prior understandings and agreements (whether written,
      oral or otherwise) pertaining to the subject matter hereof, and constitutes
      the
      entire agreement between the parties hereto relating to the subject matter
      hereof and the transactions provided for herein. 

      

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    8.7  Counterparts.
      This
      Agreement may be executed in any number of counterparts each of which shall
      be
      deemed an original and all of which shall constitute one and the same agreement
      with the same effect as if all parties had signed the same signature page.
      The
      parties shall accept facsimile signatures as the equivalent of original ones.
      

     

    8.8  Severability.
      If any
      provision of this Agreement or the application of such provision to any Person
      or circumstance will be held invalid, the remainder of this Agreement or the
      application of such provision to Persons or circumstances other than those
      to
      which it is held invalid will not be affected thereby. 

     

    8.9  Additional
      Documents and Acts.
      Borrower shall execute and deliver such additional documents and instruments
      and
      shall perform such additional acts as may be necessary or appropriate to
      effectuate, carry out and perform all of the terms, provisions, and conditions
      of this Agreement and the transactions contemplated by this Agreement.

     

    8.10  Survival.
      All
      indemnities, rights, remedies, representations and warranties contained herein
      shall survive the expiration or termination of this Agreement, and no
      termination or expiration hereof shall relieve either party from liability
      for
      any breach of this Agreement. 

    

    

    

    [SIGNATURE
      PAGE FOLLOWS]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    IN
      WITNESS WHEREOF, the parties have executed and delivered this Agreement to
      one
      another as of the date first above written.

    

    
      	BORROWER: 	 	 	FMG ACQUISITION CORP. 
	 	 	 	 
	 	 	 	 
	
            	 	 	By:

	
            	 	 	
              
                

              
Gordon Pratt
	 	 	 	Chief
              Executive
              Officer

      

      
        	LENDER: 	 	 	FMG INVESTORS LLC 
	 	 	 	 
	 	 	 	 
	
              	 	 	By:

	
              	 	 	
                
                  

                
[         
                ]
	 	 	 	Managing
                Member

      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    EXHIBIT
      A

    REVOLVING
      LINE OF CREDIT NOTE

    
      	
               

            	
               

            	
               

            
	
              Not
                to Exceed $250,000 in Principal 

            	
               

            	
              ___________,
                2007

            

    

         

    For
      value
      received, the undersigned FMG
      ACQUISITION CORP.,
      a
      Delaware corporation (“Borrower”),
      promises to pay, in lawful money of the United States, to the order of
FMG
      INVESTORS LLC,
      together with its successors and assigns (“Holder”),
      at
      such address as Holder may direct, the principal sum of Two Hundred Fifty
      Thousand Dollars ($250,000), without interest, or so much thereof as shall
      have
      been advanced and shall remain unpaid hereunder. 

     

    This
      Note
      is delivered pursuant to, and is subject to all of the terms and conditions
      of,
      that certain Amended and Restated Subordinated Revolving Line of Credit
      Agreement dated as of ________, 2007 (the “Loan
      Agreement”)
      between Borrower and Holder. Unless otherwise defined in this Note, capitalized
      terms used in this Note shall have the meanings ascribed to them in the Loan
      Agreement, and in the event of any conflict between the terms of this Note
      and
      the terms of the Loan Agreement, the terms of the Loan Agreement shall govern.
      

     

    1.  Maturity.  This
      Note shall mature and become due and payable upon the earlier of an Event of
      Default (after the expiration of any cure period), upon consummation of a
      Business Combination or as described in Section 1 of the Loan Agreement.

     

    2.  Prepayment.  This
      Note may be repaid in whole or in part at any time without penalty or premium.
      

     

    3.  Event
      of Default.  Should
      an Event of Default occur, Lenders shall have the rights set forth in
      Section 7 of the Loan Agreement. 

     

    4.  Borrower’s
      Acknowledgement.  Borrower
      acknowledges that Holder is extending the credit contemplated hereby solely
      as
      an accommodation to Borrower, and is willing to do so in reliance upon
      Borrower’s monetary and non-monetary covenants contained herein and in the Loan
      Agreement. 

     

    5.  Holder’s
      Acknowledgement.  The
      Holder acknowledges and agrees that, as specified in Section 5 of the Loan
      Agreement, the Holder has limited recourse against Borrower for repayment of
      any
      and all amounts due and owing under this Note. 

     

    6.  Miscellaneous.  If
      this Note (or any payment due hereunder) is not paid when due, Borrower promises
      to pay all costs and expenses of collection and reasonable attorneys’ fees
      incurred by the Holder hereof on account of such collection whether or not
      suit
      is filed hereon. Borrower consents to renewals, replacements and extensions
      of
      time for payment hereof, before, at, or after maturity, consents to the
      acceptance, release or substitution of security for this Note, and waives demand
      and protest. The indebtedness evidenced hereby shall be payable in lawful money
      of the United States. In any action brought under or arising out of this Note,
      Borrower, including successor(s) or assign(s), hereby consents to the
      application of Delaware law, to the jurisdiction of any competent court within
      the State of Delaware, and to service of process by any means authorized by
      Delaware law. No single or partial exercise of any power hereunder, or under
      any
      other Loan Document in connection herewith, shall preclude other or further
      exercises thereof or the exercise of any other such power. 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    IN
      WITNESS WHEREOF, Borrower has executed and delivered this Note as of the date
      first above written. 

     

    
      	 	 	 
	 	
              FMG
                ACQUISITION CORP.

            
	 
 	 
 	 
 
	: 	By:  	
            
	 	
              
Name:
              Gordon Pratt
	 	 
	 	Title:
              Chief Executive Officer and
              PresidentExhibit
      10.1

     

    CHINA
      ARCHITECTURAL ENGINEERING, INC.

     

    2007
      EQUITY INCENTIVE PLAN

     

    ARTICLE
      ONE

     

    GENERAL
      PROVISIONS

     

    
      	 	
              I.

            	
              PURPOSE
                OF THE PLAN

            

    

     

    This
      2007
      Equity Incentive Plan is intended to promote the interests of China
      Architectural Engineering, Inc., a Delaware corporation, by providing eligible
      persons in the Corporation’s employ or service with the opportunity to acquire a
      proprietary interest, or otherwise increase their proprietary interest, in
      the
      Corporation as an incentive for them to continue in such employ or service.
      

     

    Capitalized
      terms herein shall have the meanings assigned to such terms in the attached
      Appendix.

     

    
      	 	
              II.

            	
              STRUCTURE
                OF THE PLAN

            

    

     

    A. The
      Plan
      shall be divided into two (2) separate equity programs:

     

    (i) the
      Option Grant Program under which eligible persons may, at the discretion of
      the
      Plan Administrator, be granted options to purchase shares of Common Stock,
      and

     

    (ii) the
      Stock
      Issuance Program under which eligible persons may, at the discretion of the
      Plan
      Administrator, be issued shares of Common Stock directly, either through the
      immediate purchase of such shares or as a bonus for services rendered the
      Corporation (or any Parent or Subsidiary). 

     

    B. The
      provisions of Articles One and Four shall apply to both equity programs under
      the Plan and shall accordingly govern the interests of all persons under the
      Plan.

     

    
      	 	
              III.

            	
              ADMINISTRATION
                OF THE PLAN

            

    

     

    A. The
      Plan
      shall be administered by the Board. However, any or all administrative functions
      otherwise exercisable by the Board may be delegated to the Committee. Members
      of
      the Committee shall serve for such period of time as the Board may determine
      and
      shall be subject to removal by the Board at any time. The Board may also at
      any
      time terminate the functions of the Committee and reassume all powers and
      authority previously delegated to the Committee.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    B. The
      Plan
      Administrator shall have full power and authority (subject to the provisions
      of
      the Plan) to establish such rules and regulations as it may deem appropriate
      for
      proper administration of the Plan and to make such determinations under, and
      issue such interpretations of, the Plan and any outstanding options or stock
      issuances thereunder as it may deem necessary or advisable. Decisions of the
      Plan Administrator shall be final and binding on all parties who have an
      interest in the Plan or any option grant or stock issuance
      thereunder.

     

    
      	 	
              IV.

            	
              ELIGIBILITY

            

    

     

    A. The
      persons eligible to participate in the Plan are as follows:

     

    (i) Employees,

     

    (ii) non-employee
      members of the Board or the non-employee members of the board of directors
      of
      any Parent or Subsidiary, and

     

    (iii) consultants
      and other independent advisors who provide services to the Corporation (or
      any
      Parent or Subsidiary).

     

    B. The
      Plan
      Administrator shall have full authority to determine, (i) with respect to the
      grants made under the Option Grant Program, which eligible persons are to
      receive such grants, the time or times when those grants are to be made, the
      number of shares to be covered by each such grant, the status of the granted
      option as either an Incentive Option or a Non-Statutory Option, the time or
      times when each option is to become exercisable, the vesting schedule (if any)
      applicable to the option shares and the maximum term for which the option is
      to
      remain outstanding, and (ii) with respect to stock issuances made under the
      Stock Issuance Program, which eligible persons are to receive such issuances,
      the time or times when those issuances are to be made, the number of shares
      to
      be issued to each Participant, the vesting schedule (if any) applicable to
      the
      issued shares and the consideration to be paid by the Participant for such
      shares.

     

    C. The
      Plan
      Administrator shall have the absolute discretion either to grant options in
      accordance with the Option Grant Program or to effect stock issuances in
      accordance with the Stock Issuance Program.

     

    
      	 	
              V.

            	
              STOCK
                SUBJECT TO THE PLAN

            

    

     

    A. The
      stock
      issuable under the Plan shall be shares of authorized but unissued or reacquired
      Common Stock. The maximum number of shares of Common Stock which may be issued
      over the term of the Plan shall not exceed Five Million (5,000,000)
      shares.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    B. Shares
      of
      Common Stock subject to outstanding options shall be available for subsequent
      issuance under the Plan to the extent (i) the options expire or terminate for
      any reason prior to exercise in full or (ii) the options are cancelled in
      accordance with the cancellation-regrant provisions of Article Two. Unvested
      shares issued under the Plan and subsequently repurchased by the Corporation,
      at
      a price per share not greater than the option exercise or direct issue price
      paid per share, pursuant to the Corporation’s repurchase rights under the Plan
      shall be added back to the number of shares of Common Stock reserved for
      issuance under the Plan and shall accordingly be available for reissuance
      through one or more subsequent option grants or direct stock issuances under
      the
      Plan.

     

    C. Should
      any change be made to the Common Stock by reason of any stock split, stock
      dividend, recapitalization, combination of shares, exchange of shares or other
      change affecting the outstanding Common Stock as a class without the
      Corporation’s receipt of consideration, proportionate adjustments shall be made
      to (i) the maximum number and/or class of securities issuable under the Plan,
      including the number of shares by which the maximum number of shares may be
      increased annually, and the per individual limitations on the number of shares
      of Common Stock that may be issued and (ii) the number and/or class of
      securities and the exercise price per share in effect under each outstanding
      option in order to prevent the dilution or enlargement of benefits thereunder.
      The adjustments determined by the Plan Administrator shall be final, binding
      and
      conclusive. In no event shall any such adjustments be made in connection with
      the conversion of one or more outstanding shares of the Corporation’s preferred
      stock into shares of Common Stock.

     

    ARTICLE
      TWO

     

    OPTION
      GRANT PROGRAM

     

    
      	 	
              I.

            	
              OPTION
                TERMS

            

    

     

    Each
      option shall be evidenced by one or more documents in the form approved by
      the
      Plan Administrator; provided,
      however,
      that
      each such document shall comply with the terms specified below. Each document
      evidencing an Incentive Option shall, in addition, be subject to the provisions
      of the Plan applicable to such options.

     

    A. Exercise
      Price.

     

    1. The
      exercise price per share shall be fixed by the Plan Administrator in accordance
      with the following provisions:

     

    (i) The
      exercise price per share shall not be less than one hundred percent (100%)
      of
      the Fair Market Value per share of Common Stock on the option grant
      date.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (ii) Until
      such time as the Corporation becomes subject to the reporting requirements
      of
      Section 13 or 15(d) of the 1934 Act, if the person to whom the option is granted
      is a 10% Stockholder, then the exercise price per share shall not be less than
      one hundred ten percent (110%) of the Fair Market Value per share of Common
      Stock on the option grant date.

     

    2. The
      exercise price shall become immediately due upon exercise of the option and
      shall, subject to the provisions of Section I of Article Four and the documents
      evidencing the option, be payable in cash or check made payable to the
      Corporation. Should the Common Stock be registered under Section 12 of the
      1934
      Act at the time the option is exercised, then the exercise price may also be
      paid as follows:

     

    (i) in
      shares
      of Common Stock held for the requisite period necessary to avoid a charge to
      the
      Corporation’s earnings for financial reporting purposes and valued at Fair
      Market Value on the Exercise Date, or

     

    (ii) to
      the
      extent the option is exercised for vested Option Shares and unless prohibited
      by
      Section 402 of the Sarbanes Oxley Act of 2002, through payment in accordance
      with a brokerage transaction as permitted under the provisions of Regulation
      T
      applicable to cashless exercises promulgated by the Federal Reserve Board out
      of
      the sale proceeds available on the settlement date of sufficient funds to cover
      the aggregate exercise price payable for the purchased shares plus all
      applicable income and employment taxes required to be withheld by the
      Corporation by reason of such exercise and the Optionee shall concurrently
      provide irrevocable instructions to the Corporation to deliver the certificates
      for the purchased shares directly to a brokerage firm in order to complete
      the
      sale.

     

    Except
      to
      the extent such sale and remittance procedure is utilized, payment of the
      exercise price for the purchased shares must be made on the Exercise
      Date.

     

    B. Exercise
      and Term of Options.
      Each
      option shall be exercisable at such time or times, during such period and for
      such number of shares as shall be determined by the Plan Administrator and
      set
      forth in the documents evidencing the option grant. However, no option shall
      have a term in excess of ten (10) years measured from the option grant
      date.

     

    C. Effect
      of Termination of Service.

     

    1. The
      following provisions shall govern the exercise of any options held by the
      Optionee at the time of cessation of Service or death:

     

    (i) Should
      the Optionee cease to remain in Service for any reason other than death,
      Disability or Misconduct, then the Optionee shall have a period of thirty (30)
      days following the date of such cessation of Service during which to exercise
      each outstanding option held by such Optionee.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (ii) Should
      Optionee’s Service terminate by reason of Disability, then the Optionee shall
      have a period of six (6) months following the date of such cessation of Service
      during which to exercise each outstanding option held by such Optionee.

     

    (iii) If
      the
      Optionee dies while holding an outstanding option, then the personal
      representative of his or her estate or the person or persons to whom the option
      is transferred pursuant to the Optionee’s will or the laws of inheritance or the
      Optionee’s designated beneficiary or beneficiaries of that option shall have a
      six (6)-month period following the date of the Optionee’s death to exercise such
      option. 

     

    (iv) Under
      no
      circumstances, however, shall any such option be exercisable after the specified
      expiration of the option term.

     

    (v) During
      the applicable post-Service exercise period, the option may not be exercised
      in
      the aggregate for more than the number of vested shares for which the option
      is
      exercisable on the date of the Optionee’s cessation of Service. Upon the
      expiration of the applicable exercise period or (if earlier) upon the expiration
      of the option term, the option shall terminate and cease to be outstanding
      for
      any vested shares for which the option has not been exercised. However, the
      option shall, immediately upon the Optionee’s cessation of Service, terminate
      and cease to be outstanding with respect to any and all option shares for which
      the option is not otherwise at the time exercisable or in which the Optionee
      is
      not otherwise at that time vested. 

     

    (vi) Should
      Optionee’s Service be terminated for Misconduct or should Optionee otherwise
      engage in Misconduct while holding one or more outstanding options under the
      Plan, then all those options shall terminate immediately and cease to remain
      outstanding.

     

    2. The
      Plan
      Administrator shall have the discretion, exercisable either at the time an
      option is granted or at any time while the option remains outstanding,
      to:

     

    (i) extend
      the period of time for which the option is to remain exercisable following
      Optionee’s cessation of Service or death from the limited period otherwise in
      effect for that option to such greater period of time as the Plan Administrator
      shall deem appropriate, but in no event beyond the expiration of the option
      term, and/or

     

    (ii) permit
      the option to be exercised, during the applicable post-Service exercise period,
      not only with respect to the number of vested shares of Common Stock for which
      such option is exercisable at the time of the Optionee’s cessation of Service
      but also with respect to one or more additional installments in which the
      Optionee would have vested under the option had the Optionee continued in
      Service.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    D. Stockholder
      Rights.
      The
      holder of an option shall have no stockholder rights with respect to the shares
      subject to the option until such person shall have exercised the option, paid
      the exercise price and become the recordholder of the purchased
      shares.

     

    E. Exercisability
      and Unvested Shares.
      Options
      shall be exercisable at such time or times and subject to such waiting periods,
      exercise dates, restrictions on exercise and other terms and conditions as
      shall
      be determined by the Plan Administrator at or after the time of grant. The
      Plan
      Administrator shall have the discretion to grant options which are exercisable
      for unvested shares of Common Stock. A Participant shall vest separately in
      each
      Option granted hereunder in accordance with a schedule determined by the Plan
      Administrator, in its sole discretion. The Plan Administrator may provide,
      in
      its discretion, that any option shall be exercisable only in installments,
      and
      the Plan Administrator may waive such installment exercise provisions at any
      time in whole or in part based on such factors as the Plan Administrator may
      determine in its sole discretion. Should the Optionee cease Service while
      holding such unvested shares, the Corporation shall have the right to repurchase
      any or all of those unvested shares at a price per share equal to the
      lower of (i)
      the
      exercise price paid per share or (ii) the Fair Market Value per share of Common
      Stock at the time of Optionee’s cessation of Service. The terms upon which such
      repurchase right shall be exercisable (including the period and procedure for
      exercise and the appropriate vesting schedule for the purchased shares) shall
      be
      established by the Plan Administrator and set forth in the document evidencing
      such repurchase right. Until such time as the Corporation becomes subject to
      the
      reporting requirements of Section 13 or 15(d) of the 1934 Act, the Plan
      Administrator may not impose a vesting schedule upon any option grant or the
      shares of Common Stock subject to the right of repurchase which is more
      restrictive than twenty percent (20%) per year vesting, with the initial vesting
      to occur not later than one (1) year after the option grant date. However,
      such
      limitation shall not be applicable to any option grants made to individuals
      who
      are officers of the Corporation, non-employee Board members or independent
      consultants.

     

    F. Individual
      Limit.
      In any
      calendar year, no Participant may receive options that relate to more than
      Two
      Million (2,000,000) shares. The foregoing limitation will be adjusted
      proportionately in connection with any change in the Corporation’s
      capitalization as described in Section V.C. of Article I. If an option is
      cancelled in the same calendar year in which it was granted (other than in
      connection with a Change of Control) the cancelled option will be counted
      against the limit set forth in this subsection F. For this purpose, if the
      exercise price of an option is reduced, the transaction will be treated as
      a
      cancellation of the option and the grant of a new option. This subsection F
      applies only with respect to option grants that are made at the end of the
      transition period prescribed by the regulations under Code Section
      162(m).

     

    G. Limited
      Transferability of Options.
      An
      Incentive Stock Option shall be exercisable only by the Optionee during his
      or
      her lifetime and shall not be assignable or transferable other than by will
      or
      by the laws of inheritance following the Optionee’s death. If permitted by
      applicable law and if the Agreement so provides, a Non-Statutory Option may
      be
      transferred by an Optionee to the Optionee’s family members as a gift, whether
      directly or indirectly, or by means of a trust or partnership or otherwise,
      or
      pursuant to a qualified domestic relations order as defined in the Code or
      Title
      1 of the Employee Retirement Income Security Act of 1974, as amended,
provided,
      that,
      if the
      Corporation is subject to the reporting requirements of Section 13 or 15(d)
      of
      the Exchange Act, then as otherwise permitted pursuant to General Instructions
      A.1(a)(5) to Form S-8 under the Securities Act of 1933, as amended, or any
      successor thereto. For purposes of this Plan, unless otherwise determined by
      the
      Plan Administrator, "family
      member"
      shall
      have the meaning given to such term in Rule 701 promulgated under the Securities
      Act, provided,
      that,
      if the
      Corporation is subject to the reporting requirements of Section 13 or 15(d)
      of
      the Exchange Act, then it shall have the meaning given to such term in General
      Instructions A.1(a)(5) to Form S-8 under the Securities Act of 1933, as amended,
      or any successor thereto.  The
      assigned portion may only be exercised by the person or persons who acquire
      a
      proprietary interest in the Non-Statutory Option pursuant to the assignment.
      The
      terms applicable to the assigned portion shall be the same as those in effect
      for the option immediately prior to such assignment and shall be set forth
      in
      such documents issued to the assignee as the Plan Administrator may deem
      appropriate. Notwithstanding the foregoing, the Optionee may also designate
      one
      or more persons as the beneficiary or beneficiaries of his or her outstanding
      options under the Plan, and those options shall, in accordance with such
      designation, automatically be transferred to such beneficiary or beneficiaries
      upon the Optionee’s death while holding those options. Such beneficiary or
      beneficiaries shall take the transferred options subject to all the terms and
      conditions of the applicable agreement evidencing each such transferred option,
      including (without limitation) the limited time period during which the option
      may be exercised following the Optionee’s death.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      	 	
              II.

            	
              INCENTIVE
                OPTIONS

            

    

     

    The
      terms
      specified below shall be applicable to all Incentive Options. Except as modified
      by the provisions of this Section II, all the provisions of Articles One, Two
      and Four shall be applicable to Incentive Options. Options which are
      specifically designated as Non-Statutory Options shall not be subject to the
      terms of this Section II.

     

    A. Eligibility.
      Incentive Options may only be granted to Employees.

     

    B. Exercise
      Price.
      The
      exercise price per share shall not be less than one hundred percent (100%)
      of
      the Fair Market Value per share of Common Stock on the option grant date;
provided,
      however,
      that if
      the person to whom the option is granted is a 10% Stockholder, then the exercise
      price per share shall not be less than one hundred ten percent (110%) of the
      Fair Market Value per share of Common Stock on the option grant
      date.

     

    C. Dollar
      Limitation.
      The
      aggregate Fair Market Value of the shares of Common Stock (determined as of
      the
      respective date or dates of grant) for which one or more options granted to
      any
      Employee under the Plan (or any other option plan of the Corporation or any
      Parent or Subsidiary) may for the first time become exercisable as Incentive
      Options during any one (1) calendar year shall not exceed the sum of One Hundred
      Thousand Dollars ($100,000). To the extent the Employee holds two (2) or more
      such options which become exercisable for the first time in the same calendar
      year, the foregoing limitation on the exercisability of such options as
      Incentive Options shall be applied on the basis of the order in which such
      options are granted.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    D. 10%
      Stockholder.
      If any
      Employee to whom an Incentive Option is granted is a 10% Stockholder, then
      the
      option term shall not exceed five (5) years measured from the option grant
      date.

     

    
      	 	
              III.

            	
              CHANGE
                IN CONTROL

            

    

     

    A. In
      the
      event of a pending or threatened Change of Control, the Plan Administrator
      may,
      in its sole and absolute discretion, and to the extent the acceleration of
      options is not subject to other limitations imposed by the Plan Administrator
      at
      the time of the option grant or otherwise in accordance with the terms of the
      Plan, take any one or more of the following actions: 

     

    (i) provide
      that some or all of the options outstanding under the Plan at the time of a
      Change in Control shall automatically vest in full so that each such option
      shall, immediately prior to the effective date of the Change in Control, become
      exercisable for all of the shares of Common Stock at the time subject to that
      option and may be exercised for any or all of those shares as fully-vested
      shares of Common Stock; or

     

    (ii) provide
      that some or all of the outstanding options previously granted under the Plan,
      whether or not then exercisable, shall terminate as of a date before or at
      the
      time of the Change of Control without any payment to the holder of the option,
      provided the Plan Administrator gives prior written notice to the Participants
      of such termination and gives such Participants the right to exercise their
      outstanding options before such date to the extent then exercisable;
      or

     

    (iii) provide
      that some or all of the options will be assumed by the successor corporation
      (or
      parent thereof) or otherwise continued in full force and effect pursuant to
      the
      terms of the Change in Control transaction in effect; or 

     

    (iv) provide
      that at or immediately following the consummation of the Change in Control,
      some
      or all outstanding options shall terminate and cease to be outstanding, except
      to the extent assumed by the successor corporation (or parent thereof) or
      otherwise continued in effect pursuant to the terms of the Change in Control
      transaction; or

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    (v) provide
      that some or all outstanding options are to be replaced with a cash incentive
      program of the Corporation or any successor corporation which preserves the
      spread existing on the unvested option shares at the time of the Change in
      Control and provides for subsequent payout of that spread in accordance with
      the
      same vesting schedule applicable to those unvested option shares;
      or

     

    (vi) provide
      that before or at the time of the Change of Control some or all outstanding
      options previously granted under the Plan shall terminate, whether or not then
      exercisable, in consideration of payment to the holder of the option, with
      respect to each share of Common Stock for which the option is then exercisable,
      of the excess, if any, of the Fair Market Value on such date of the Common
      Stock
      subject to the exercisable portion of the option over the exercise price of
      such
      option; or

     

    (vii) provide
      that upon the occurrence of a Change in Control, some or all outstanding options
      previously granted under the Plan shall be subject to the terms of any
      applicable agreement of merger or reorganization relating to such Change in
      Control.

     

    B. In
      the
      event of a pending or threatened Change of Control, the Plan Administrator
      may,
      in its sole and absolute discretion, and to the extent the treatment of
      outstanding repurchase rights are not subject to other limitations imposed
      by
      the Plan Administrator at the time the repurchase right is issued or otherwise
      in accordance with the terms of the Plan, take any one or more of the following
      actions: 

     

    (i) provide
      that some or all outstanding repurchase rights shall terminate automatically,
      and the shares of Common Stock subject to those terminated rights shall
      immediately vest in full, in the event of any Change in Control; or

     

    (ii) provide
      that some or all of the shares of Common Stock subject to outstanding repurchase
      rights shall be exchanged or otherwise converted into the right to receive
      cash
      or other adequate consideration (including, without limitation, such
      consideration as received by other stockholders of the Company in connection
      with the Change in Control); or

     

    (iii) provide
      that some or all repurchase rights are assigned to the successor corporation
      (or
      parent thereof) or otherwise continue in full force and effect pursuant to
      the
      terms of the Change in Control transaction; or

     

    (iv) provide
      that some or all unvested shares will be repurchased before or on the Control
      Change Date pursuant to the Corporation’s right of repurchase; or

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (v) provide
      that upon the occurrence of a Change in Control, some or all of the shares
      of
      Common Stock subject to outstanding repurchase rights shall be subject to the
      terms of any applicable agreement of merger or reorganization relating to such
      Change in Control.

     

    C. If
      applicable, each option which is assumed in connection with a Change in Control
      or otherwise continued in effect shall be appropriately adjusted, immediately
      after such Change in Control, to apply to the number and class of securities
      which would have been issuable to the Optionee in consummation of such Change
      in
      Control, had the option been exercised immediately prior to such Change in
      Control. Appropriate adjustments shall also be made to (i) the number and class
      of securities available for issuance under the Plan following the consummation
      of such Change in Control and (ii) the exercise price payable per share under
      each outstanding option, provided
      the
      aggregate exercise price payable for such securities shall remain the same.
      To
      the extent the actual holders of the Corporation’s outstanding Common Stock
      receive cash consideration for their Common Stock in consummation of the Change
      in Control, the successor corporation may, in connection with the assumption
      of
      the outstanding options under this Plan, substitute one or more shares of its
      own common stock with a fair market value equivalent to the cash consideration
      paid per share of Common Stock in such Change in Control.

     

    D. The
      Plan
      Administrator shall have the discretion, exercisable either at the time the
      option is granted or at any time while the option remains outstanding, to
      structure one or more options so that those options shall automatically
      accelerate and vest in full (and any repurchase rights of the Corporation with
      respect to the unvested shares subject to those options shall immediately
      terminate) upon the occurrence of a Change in Control, whether or not those
      options are to be assumed in the Change in Control or otherwise continued in
      effect.

     

    E. The
      Plan
      Administrator shall also have full power and authority, exercisable either
      at
      the time the option is granted or at any time while the option remains
      outstanding, to structure such option so that the shares subject to that option
      will automatically vest on an accelerated basis should the Optionee’s Service
      terminate by reason of an Involuntary Termination within a designated period
      (not to exceed eighteen (18) months) following the effective date of any Change
      in Control in which the option is assumed or otherwise continued in effect
      and
      the repurchase rights applicable to those shares do not otherwise terminate.
      Any
      option so accelerated shall remain exercisable for the fully-vested option
      shares until the expiration or sooner termination of the option term. In
      addition, the Plan Administrator may provide that one or more of the
      Corporation’s outstanding repurchase rights with respect to shares held by the
      Optionee at the time of such Involuntary Termination shall immediately terminate
      on an accelerated basis, and the shares subject to those terminated rights
      shall
      accordingly vest at that time.

     

    F. The
      portion of any Incentive Option accelerated in connection with a Change in
      Control shall remain exercisable as an Incentive Option only to the extent
      the
      applicable One Hundred Thousand Dollar ($100,000) limitation is not exceeded.
      To
      the extent such dollar limitation is exceeded, the accelerated portion of such
      option shall be exercisable as a Non-Statutory Option under the Federal tax
      laws.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    G. The
      grant
      of options under the Plan shall in no way affect the right of the Corporation
      to
      adjust, reclassify, reorganize or otherwise change its capital or business
      structure or to merge, consolidate, dissolve, liquidate or sell or transfer
      all
      or any part of its business or assets.

     

    
      	 	
              IV.

            	
              CANCELLATION
                AND REGRANT OF OPTIONS

            

    

     

    The
      Plan
      Administrator shall have the authority to effect, at any time and from time
      to
      time, with the consent of the affected option holders, the cancellation of
      any
      or all outstanding options under the Plan and to grant in substitution therefor
      new options covering the same or different number of shares of Common Stock
      but
      with an exercise price per share based on the Fair Market Value per share of
      Common Stock on the new option grant date.

     

    ARTICLE
      THREE

     

    STOCK
      ISSUANCE PROGRAM

     

    
      	 	
              I.

            	
              STOCK
                ISSUANCE TERMS

            

    

     

    Shares
      of
      Common Stock may be issued under the Stock Issuance Program through direct
      and
      immediate issuances without any intervening option grants. Each such stock
      issuance shall be evidenced by a Stock Issuance Agreement which complies with
      the terms specified below.

     

    A. Purchase
      Price.

     

    1. The
      purchase price per share shall be fixed by the Plan Administrator but shall
      not
      be less than eighty-five percent (85%) of the Fair Market Value per share of
      Common Stock on the issue date. However, the purchase price per share of Common
      Stock issued to a 10% Stockholder shall not be less than one hundred percent
      (100%) of such Fair Market Value.

     

    2. Subject
      to the provisions of Section I of Article Four, shares of Common Stock may
      be
      issued under the Stock Issuance Program for any of the following items of
      consideration which the Plan Administrator may deem appropriate in each
      individual instance:

     

    (i) cash
      or
      check made payable to the Corporation, or

     

    (ii) past
      services rendered to the Corporation (or any Parent or Subsidiary).

     

    B. Vesting
      Provisions.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    1. Shares
      of
      Common Stock issued under the Stock Issuance Program may, in the discretion
      of
      the Plan Administrator, be fully and immediately vested upon issuance or may
      vest in one or more installments over the Participant’s period of Service or
      upon attainment of specified performance objectives. Until such time as the
      Corporation becomes subject to the reporting requirements of Section 13 or
      15(d)
      of the 1934 Act, the Plan Administrator may not impose a vesting schedule upon
      any stock issuance effected under the Stock Issuance Program which is more
      restrictive than twenty percent (20%) per year vesting, with initial vesting
      to
      occur not later than one (1) year after the issuance date. Such limitation
      shall
      not apply to any Common Stock issuances made to the officers of the Corporation,
      non-employee Board members or independent consultants.

     

    2. Any
      new,
      substituted or additional securities or other property (including money paid
      other than as a regular cash dividend) which the Participant may have the right
      to receive with respect to the Participant’s unvested shares of Common Stock by
      reason of any stock dividend, stock split, recapitalization, combination of
      shares, exchange of shares or other change affecting the outstanding Common
      Stock as a class without the Corporation’s receipt of consideration shall be
      issued subject to (i) the same vesting requirements applicable to the
      Participant’s unvested shares of Common Stock and (ii) such escrow arrangements
      as the Plan Administrator shall deem appropriate.

     

    3. The
      Participant shall have full stockholder rights with respect to any shares of
      Common Stock issued to the Participant under the Stock Issuance Program, whether
      or not the Participant’s interest in those shares is vested. Accordingly, the
      Participant shall have the right to vote such shares and to receive any regular
      cash dividends paid on such shares. 

     

    4. Should
      the Participant cease to remain in Service while holding one or more unvested
      shares of Common Stock issued under the Stock Issuance Program or should the
      performance objectives not be attained with respect to one or more such unvested
      shares of Common Stock, then those shares shall be immediately surrendered
      to
      the Corporation for cancellation, and the Participant shall have no further
      stockholder rights with respect to those shares. To the extent the surrendered
      shares were previously issued to the Participant for consideration paid in
      cash
      or cash equivalent (including the Participant’s purchase-money indebtedness),
      the Corporation shall repay to the Participant the
      lower of (i)
      the
      cash consideration paid for the surrendered shares or (ii) the Fair Market
      Value
      of the shares at the time of Participant’s cessation of service and shall cancel
      the unpaid principal balance of any outstanding purchase-money note of the
      Participant attributable to such surrendered shares by the applicable clause
      (i)
      or (ii) amount.

     

    5. The
      Plan
      Administrator may in its discretion waive the surrender and cancellation of
      one
      or more unvested shares of Common Stock (or other assets attributable thereto)
      which would otherwise occur upon the non-completion of the vesting schedule
      applicable to those shares. Such waiver shall result in the immediate vesting
      of
      the Participant’s interest in the shares of Common Stock as to which the waiver
      applies. Such waiver may be effected at any time, whether before or after the
      Participant’s cessation of Service or the attainment or non-attainment of the
      applicable performance objectives.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      	 	
              II.

            	
              CHANGE
                IN CONTROL

            

    

     

    A. In
      the
      event of a pending or threatened Change of Control, the Plan Administrator
      may,
      in its sole and absolute discretion, and to the extent the treatment of
      repurchase rights is not subject to other limitations imposed by the Plan
      Administrator at the time of issuance of the repurchase right or otherwise
      in
      accordance with the terms of the Plan, take any one or more of the following
      actions: 

     

    (i) provide
      that upon the occurrence of a Change in Control, some or all outstanding
      repurchase rights under the Stock Issuance Program shall terminate
      automatically, and the shares of Common Stock subject to those terminated rights
      shall immediately vest in full; or 

     

    (ii) provide
      that upon the occurrence of a Change in Control, some or all of the shares
      of
      Common Stock subject to outstanding repurchase rights under the Stock Issuance
      Program shall be exchanged or otherwise converted into the right to receive
      cash
      or other adequate consideration (including, without limitation, such
      consideration as received by other stockholders of the Company in connection
      with the Change in Control; or

     

    (iii) provide
      that those repurchase rights are assigned to the successor corporation (or
      parent thereof) or otherwise continued in full force and effect pursuant to
      the
      terms of the Change in Control transaction; or

     

    (iv) provide
      that some or all shares subject to the Corporation’s right of repurchase will be
      repurchased before or at the time of the Change of Control; or

     

    (v) provide
      that upon the occurrence of a Change in Control, some or all of the shares
      of
      Common Stock subject to outstanding repurchase rights under the Stock Issuance
      Program shall be subject to the terms of any applicable agreement of merger
      or
      reorganization relating to such Change in Control.

     

    B. The
      Plan
      Administrator shall have the discretionary authority, exercisable either at
      the
      time the unvested shares are issued or any time while the Corporation’s
      repurchase rights with respect to those shares remain outstanding, to provide
      that those rights shall automatically terminate on an accelerated basis, and
      the
      shares of Common Stock subject to those terminated rights shall immediately
      vest, in the event the Participant’s Service should subsequently terminate by
      reason of an Involuntary Termination within a designated period (not to exceed
      eighteen (18) months) following the effective date of any Change in Control
      in
      which those repurchase rights are assigned to the successor corporation (or
      parent thereof) or otherwise continued in full force and effect.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    
      	 	
              III.

            	
              SHARE
                ESCROW/LEGENDS

            

    

     

    Unvested
      shares may, in the Plan Administrator’s discretion, be held in escrow by the
      Corporation until the Participant’s interest in such shares vests or may be
      issued directly to the Participant with restrictive legends on the certificates
      evidencing those unvested shares. 

     

    ARTICLE
      FOUR

     

    MISCELLANEOUS

     

    
      	 	
              I.

            	
              FINANCING

            

    

     

    To
      the
      extent permitted by applicable law, the Plan Administrator may permit any
      Optionee or Participant to pay the option exercise price under the Option Grant
      Program or the purchase price for shares issued under the Stock Issuance Program
      by delivering a full-recourse promissory note payable in one or more
      installments which bears interest at a market rate and is secured by the
      purchased shares. However, any promissory note delivered by a consultant must
      be
      secured by collateral in addition to the purchased shares of Common Stock.
      In no
      event may the maximum credit available to the Optionee or Participant exceed
      the
      sum of (i) the aggregate option exercise price or purchase price payable for
      the
      purchased shares plus (ii) any applicable income and employment tax liability
      incurred by the Optionee or the Participant in connection with the option
      exercise or share purchase.

     

    
      	 	
              II.

            	
              EFFECTIVE
                DATE AND TERM OF PLAN

            

    

     

    A. The
      Plan
      shall become effective when adopted by the Board, but no option granted under
      the Plan may be exercised, and no shares shall be issued under the Plan, until
      the Plan is approved by the Corporation’s stockholders. If such stockholder
      approval is not obtained within twelve (12) months after the date of the Board’s
      adoption of the Plan, then all options previously granted under the Plan shall
      terminate and cease to be outstanding, and no further options shall be granted
      and no shares shall be issued under the Plan. Subject to such limitation, the
      Plan Administrator may grant options and issue shares under the Plan at any
      time
      after the effective date of the Plan and before the date fixed herein for
      termination of the Plan.

     

    B. The
      Plan
      shall terminate upon the earliest
      of (i)
      the expiration of the ten (10)-year period measured from the date the Plan
      is
      adopted by the Board, (ii) the date on which all shares available for issuance
      under the Plan shall have been issued as vested shares or (iii) the termination
      of all outstanding options in connection with a Change in Control. All options
      and unvested stock issuances outstanding at the time of a clause (i) termination
      event shall continue to have full force and effect in accordance with the
      provisions of the documents evidencing those options or issuances.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    
      	 	
              III.

            	
              AMENDMENT
                OF THE PLAN

            

    

     

    A. The
      Board
      shall have complete and exclusive power and authority to amend or modify the
      Plan in any or all respects. However, no such amendment or modification shall
      adversely affect the rights and obligations with respect to options or unvested
      stock issuances at the time outstanding under the Plan unless the Optionee
      or
      the Participant consents to such amendment or modification. In addition, certain
      amendments may require stockholder approval pursuant to applicable laws and
      regulations.

     

    B. Options
      may be granted under the Option Grant Program and shares may be issued under
      the
      Stock Issuance Program which are in each instance in excess of the number of
      shares of Common Stock then available for issuance under the Plan, provided
      any
      excess shares actually issued under those programs shall be held in escrow
      until
      there is obtained stockholder approval of an amendment sufficiently increasing
      the number of shares of Common Stock available for issuance under the Plan.
      If
      such stockholder approval is not obtained within twelve (12) months after the
      date the first such excess grants or issuances are made, then (i) any
      unexercised options granted on the basis of such excess shares shall terminate
      and cease to be outstanding and (ii) the Corporation shall promptly refund
      to
      the Optionees and the Participants the exercise or purchase price paid for
      any
      excess shares issued under the Plan and held in escrow, together with interest
      (at the applicable Short Term Federal Rate) for the period the shares were
      held
      in escrow, and such shares shall thereupon be automatically cancelled and cease
      to be outstanding.

     

    
      	 	
              IV.

            	
              USE
                OF PROCEEDS

            

    

     

    Any
      cash
      proceeds received by the Corporation from the sale of shares of Common Stock
      under the Plan shall be used for general corporate purposes.

     

    
      	 	
              V.

            	
              WITHHOLDING

            

    

     

    The
      Corporation’s obligation to deliver shares of Common Stock upon the exercise of
      any options granted under the Plan or upon the issuance or vesting of any shares
      issued under the Plan shall be subject to the satisfaction of all applicable
      income and employment tax withholding requirements.

     

    
      	 	
              VI.

            	
              REGULATORY
                APPROVALS

            

    

     

    The
      implementation of the Plan, the granting of any options under the Plan and
      the
      issuance of any shares of Common Stock (i) upon the exercise of any option
      or
      (ii) under the Stock Issuance Program shall be subject to the Corporation’s
      procurement of all approvals and permits required by regulatory authorities
      having jurisdiction over the Plan, the options granted under it and the shares
      of Common Stock issued pursuant to it.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    
      	 	
              VII.

            	
              NO
                EMPLOYMENT OR SERVICE
                RIGHTS

            

    

     

    Nothing
      in the Plan shall confer upon the Optionee or the Participant any right to
      continue in Service for any period of specific duration or interfere with or
      otherwise restrict in any way the rights of the Corporation (or any Parent
      or
      Subsidiary employing or retaining such person) or of the Optionee or the
      Participant, which rights are hereby expressly reserved by each, to terminate
      such person’s Service at any time for any reason, with or without
      cause.

     

    
      	 	
              VIII.

            	
              FINANCIAL
                REPORTS

            

    

     

    If
      required by applicable law, the Corporation shall deliver a balance sheet and
      an
      income statement at least annually to each individual holding an outstanding
      option under the Plan, unless such individual is a key Employee whose duties
      in
      connection with the Corporation (or any Parent or Subsidiary) assure such
      individual access to equivalent information.

     

    
      	 	
              IX.

            	
              COMPLIANCE
                WITH SECTION 409A OF THE
                CODE

            

    

     

    The
      Corporation intends that any option granted under the Plan not be considered
      to
      provide for the deferral of compensation under Code Section 409A and that any
      other stock issuance that does provide for such deferral of compensation shall
      comply with the requirements of Section 409A of the Code and, accordingly,
      this
      Plan shall be so administered and construed. Further, the Corporation may modify
      the Plan and any option grant or stock issuance to the extent necessary to
      fulfill this intent. Consistent with the intent of this Section IX, in the
      event
      that any provision that is necessary for the Plan to comply with Section 409A
      is
      determined by the Plan Administrator, in its sole discretion, to have been
      omitted, such omitted provision shall be deemed included herein and is hereby
      incorporated as part of the Plan.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    

    APPENDIX

     

    The
      following definitions shall be in effect under the Plan:

     

    A. Board
      shall
      mean the Corporation’s Board of Directors.

     

    B. Change
      in Control
      shall
      mean a change in ownership or control of the Corporation effected through any
      of
      the following transactions: 

     

    (i) a
      merger,
      consolidation or other reorganization approved by the Corporation’s
      stockholders, unless
      securities representing more than fifty percent (50%) of the total combined
      voting power of the voting securities of the successor corporation are
      immediately thereafter beneficially owned, directly or indirectly and in
      substantially the same proportion, by the persons who beneficially owned the
      Corporation’s outstanding voting securities immediately prior to such
      transaction, or

     

    (ii) a
      stockholder-approved sale, transfer or other disposition of all or substantially
      all of the Corporation’s assets in complete liquidation or dissolution of the
      Corporation, or

     

    (iii) the
      acquisition, directly or indirectly by any person or related group of persons
      (other than the Corporation or a person that directly or indirectly controls,
      is
      controlled by, or is under common control with, the Corporation), of beneficial
      ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities
      possessing more than fifty percent (50%) of the total combined voting power
      of
      the Corporation’s outstanding securities pursuant to a tender or exchange offer
      made directly to the Corporation’s stockholders.

     

    In
      no
      event shall any public offering of the Corporation’s securities be deemed to
      constitute a Change in Control.

     

    C. Code
      shall
      mean the Internal Revenue Code of 1986, as amended.

     

    D. Committee
      shall
      mean a committee of two (2) or more Board members appointed by the Board to
      exercise one or more administrative functions under the Plan. To the extent
      that
      the Plan Administrator determines it is necessary to qualify stock options
      and/or stock issuances under Section 162(m) of the Code, the Plan will be
      administered in accordance with the requirements of Section 162(m) of the Code,
      and, to the extent that the Plan Administrator determines it is desirable to
      qualify transactions as exempt under Rule 16b-3 of the 1934 Act, transactions
      will be structured to satisfy the requirements of Rule 16b-3 under the 1934
      Act.

    

    E. Common
      Stock
      shall
      mean the Corporation’s common stock.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    F. Corporation
      shall
      mean China Architectural Engineering, Inc., a Delaware corporation, and any
      successor corporation to all or substantially all of the assets or voting stock
      of China Architectural Engineering, Inc. which shall by appropriate action
      adopt
      the Plan.

     

    G. Disability
      shall
      mean the inability of the Optionee or the Participant to engage in any
      substantial gainful activity by reason of any medically determinable physical
      or
      mental impairment and shall be determined by the Plan Administrator on the
      basis
      of such medical evidence as the Plan Administrator deems warranted under the
      circumstances.

     

    H. Employee
      shall
      mean an individual who is in the employ of the Corporation (or any Parent or
      Subsidiary), subject to the control and direction of the employer entity as
      to
      both the work to be performed and the manner and method of
      performance.

     

    I. Exercise
      Date
      shall
      mean the date on which the Corporation shall have received written notice of
      the
      option exercise.

     

    J. Fair
      Market Value
      per
      share of Common Stock on any relevant date shall be determined in accordance
      with the following provisions:

     

    (i) If
      the
      Common Stock is at the time traded on the Nasdaq National Market, then the
      Fair
      Market Value shall be the closing selling price per share of Common Stock on
      the
      date in question, as such price is reported by the National Association of
      Securities Dealers on the Nasdaq National Market and published in The
      Wall Street Journal.
      If
      there is no closing selling price for the Common Stock on the date in question,
      then the Fair Market Value shall be the closing selling price on the last
      preceding date for which such quotation exists.

     

    (ii) If
      the
      Common Stock is at the time listed on any Stock Exchange, then the Fair Market
      Value shall be the closing selling price per share of Common Stock on the date
      in question on the Stock Exchange determined by the Plan Administrator to be
      the
      primary market for the Common Stock, as such price is officially quoted in
      the
      composite tape of transactions on such exchange and published in The
      Wall Street Journal.
      If
      there is no closing selling price for the Common Stock on the date in question,
      then the Fair Market Value shall be the closing selling price on the last
      preceding date for which such quotation exists.

     

    (iii) If
      the
      Common Stock is at the time neither listed on any Stock Exchange nor traded
      on
      the Nasdaq National Market, then the Fair Market Value shall be determined
      by
      the Plan Administrator after taking into account such factors as the Plan
      Administrator shall deem appropriate.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    K. Incentive
      Option
      shall
      mean an option which satisfies the requirements of Code Section
      422.

     

    L. Involuntary
      Termination
      shall
      mean the termination of the Service of any individual which occurs by reason
      of:

     

    (i) such
      individual’s involuntary dismissal or discharge by the Corporation for reasons
      other than Misconduct, or

     

    (ii) such
      individual’s voluntary resignation following (A) a change in his or her position
      with the Corporation which materially reduces his or her duties and
      responsibilities or the level of management to which he or she reports, (B)
      a
      reduction in his or her level of compensation (including base salary, fringe
      benefits and target bonus under any corporate-performance based bonus or
      incentive programs) by more than fifteen percent (15%) or (C) a relocation
      of
      such individual’s place of employment by more than fifty (50) miles,
      provided and only if such change, reduction or relocation is effected without
      the individual’s consent. 

     

    M. Misconduct
      shall
      mean the commission of any act of fraud, embezzlement or dishonesty by the
      Optionee or Participant, any unauthorized use or disclosure by such person
      of
      confidential information or trade secrets of the Corporation (or any Parent
      or
      Subsidiary), or any other intentional misconduct by such person adversely
      affecting the business or affairs of the Corporation (or any Parent or
      Subsidiary) in a material manner. The foregoing definition shall not in any
      way
      preclude or restrict the right of the Corporation (or any Parent or Subsidiary)
      to discharge or dismiss any Optionee, Participant or other person in the Service
      of the Corporation (or any Parent or Subsidiary) for any other acts or
      omissions, but such other acts or omissions shall not be deemed, for purposes
      of
      the Plan, to constitute grounds for termination for Misconduct. 

     

    N. 1934
      Act
      shall
      mean the Securities Exchange Act of 1934, as amended.

     

    O. Non-Statutory Option
      shall
      mean an option not intended to satisfy the requirements of Code Section
      422.

     

    P. Option
      Grant Program
      shall
      mean the option grant program in effect under the Plan. 

     

    Q. Optionee
      shall
      mean any person to whom an option is granted under the Plan.

     

    R. Parent
      shall
      mean any corporation (other than the Corporation) in an unbroken chain of
      corporations ending with the Corporation, provided each corporation in the
      unbroken chain (other than the Corporation) owns, at the time of the
      determination, stock possessing fifty percent (50%) or more of the total
      combined voting power of all classes of stock in one of the other corporations
      in such chain.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    S. Participant
      shall
      mean any person who is issued shares of Common Stock under the Stock Issuance
      Program.

     

    T. Plan
      shall
      mean the Corporation’s 2007 Equity Incentive Plan, as set forth in this
      document.

     

    U. Plan
      Administrator
      shall
      mean either the Board or the Committee acting in its capacity as administrator
      of the Plan.

     

    V. Service
      shall
      mean the provision of services to the Corporation (or any Parent or Subsidiary)
      by a person in the capacity of an Employee, a non-employee member of the board
      of directors or a consultant or independent advisor, except to the extent
      otherwise specifically provided in the documents evidencing the option
      grant.

     

    W. Stock
      Exchange
      shall
      mean either the American Stock Exchange or the New York Stock
      Exchange.

     

    X. Stock
      Issuance Agreement
      shall
      mean the agreement entered into by the Corporation and the Participant at the
      time of issuance of shares of Common Stock under the Stock Issuance
      Program.

     

    Y. Stock
      Issuance Program
      shall
      mean the stock issuance program in effect under the Plan. 

     

    Z. Subsidiary
      shall
      mean any entity in which, directly or indirectly through one or more
      intermediaries, the Corporation has at least a 50% ownership interest or, where
      permissible under Code Section 409A, at least a 20% ownership interest.

     

    AA. 10%
      Stockholder
      shall
      mean the owner of stock (as determined under Code Section 424(d)) possessing
      more than ten percent (10%) of the total combined voting power of all classes
      of
      stock of the Corporation (or any Parent or Subsidiary).

     

    
      
        
        

      

      
        20

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