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Unassociated Document

    THIS
      NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES
      LAWS OF ANY STATE AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH
      REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT AND APPLICABLE STATE
      SECURITIES LAWS.

     

    UNSECURED
      SENIOR PROMISSORY NOTE DUE November 30, 2007

     

    
      	
              $600,000

            	
              November
                30, 2006

            

    

     

    FOR
      VALUE RECEIVED,
      Aston
      Asset Management LLC, a Delaware limited liability company (the “Debtor”),
      hereby promises to pay to the order of Highbury Financial Inc., a Delaware
      corporation (the “Payee”),
      the
      principal amount of Six Hundred Thousand Dollars ($600,000) (the
      “Principal”),
      together with interest thereon calculated from the date hereof in accordance
      with the provisions of this Note. Capitalized terms used but not otherwise
      defined herein shall have the meaning ascribed to such term in the Aston Asset
      Management LLC Amended and Restated Limited Liability Company Agreement, dated
      as of April 20, 2006 (the “LLC
      Agreement”).

     

    1.  Due
      Date.
      The
      Principal (plus interest as provided in the following section) shall be repaid
      by Debtor on November 30, 2007.

     

    2.  Interest.
      Interest shall accrue per annum at a rate equal to the prime lending rate then
      in effect as reported by JPMorgan Chase on the unpaid Principal amount of this
      Note outstanding from time to time. Interest shall be computed on the basis
      of
      the actual number of days elapsed and a 365-day year.

     

    3.  Mandatory
      Prepayment. The
      Principal, and accrued interest thereon, of this Note shall be prepaid from
      all
      monies allocated as Owners’ Allocation that is payable to the Non-Manager
      Members and all monies allocated as Operating Allocation prior to any
      distributions by the Debtor to the Non-Manager Members. Any such prepayment
      shall be first applied to the Payment of any accrued interest and then to the
      unpaid balance of the Principal.

     

    4.  Method of Payments.

     

    (a)  Place of Payment, etc.
      Payments of Principal and interest becoming due and payable under this Note
      shall be made at the Payee’s office at 999 Eighteenth Street, Suite 3000,
      Denver, Colorado 80202 or at such place as the Payee may notify the Debtor
      in
      writing from time to time. All amounts due under this Note shall be paid in
      lawful money of the United States of America.

     

    (b)  Application
      of Payments.
      Any
      payment under this Note shall be applied first to sums due under this Note
      other
      than Principal and interest, second to accrued interest and third to any
      Principal amount outstanding under this Note.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (c)  Payments
      Due on Non-Business Days.
      If
      payment of Principal or interest on this Note becomes due on a day which is
      not
      a Business Day, such payment will be made on the next succeeding Business Day
      and such extension of time will in such case be included in computing interest
      in connection with such payment. A “Business
      Day”
shall
      mean any weekday on which banking institutions in New York, New York and Denver,
      Colorado are open for the transaction of banking business.

     

    5.  Events
      of Default.

     

    (a)  The
      term
“Event
      of Default”
means
      any of the following events:

     

    (i)  any
      payment of Principal or interest is not paid when due pursuant to Section 1
      and Section 3 and such default shall have continued for a period of five
      (5) days after the Debtor receives written notice thereof; 

     

    (ii)  the
      Debtor (x) makes an assignment for the benefit of creditors, (y) admits in
      writing its inability to pay or fails to pay its debts generally as they come
      due or (z) files a petition for relief under any chapter of the United States
      Federal Bankruptcy Code or any other bankruptcy or debtor relief law, domestic
      or foreign, as now or hereafter in effect, or seeking the appointment of a
      trustee, receiver, custodian, liquidator or similar official for it or any
      of
      its property; or any such action is commenced against it and it admits,
      acquiesces in or does not contest diligently the material allegations thereof,
      or the action results in an entry of an order for relief against it, or it
      does
      not obtain permanent dismissal and discharge thereof before the earlier of
      trial
      thereon or 60 days after commencement of the action; or

     

    (iii)  a
      breach
      of the covenants contained in Section 6 below.

     

    (b)  Remedies Upon
      Default.
      Upon
      the occurrence of an Event of Default, the entire unpaid balance of the
      principal, together with all accrued but unpaid interest thereon, shall become
      immediately due and payable, in addition to all reasonable legal fees and
      expenses incurred by Payee in connection with the collection of this Note (which
      legal fees and expenses shall be paid by Debtor).

     

    6.  Indebtedness.
      Debtor
      shall not incur, create, assume, or become liable in any manner, or permit
      to
      exist, any indebtedness unless: 

     

    (i)  such
      indebtedness is permitted under the terms of the LLC Agreement;

     

    (ii)  is
      properly legended and designated as subordinated to the Note; and

     

    (iii)  is
      not
      secured by any assets of the Debtor.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    7.  Amendment and Waiver.
      The
      provisions of this Note may not be modified or amended, except by an instrument
      in writing executed by the parties hereto. This Note shall bind the respective
      heirs, personal representatives, successors and assigns of the Debtor, and
      shall
      inure to the benefit of Payee, its successors and assigns. No waiver or consent
      by Payee with respect to this Note shall be valid and binding unless in writing
      and executed by the Payee, and any such waiver or consent which may be granted
      by Payee shall be effective only within the limitations stated in such waiver
      and only for the particular event for which such waiver is given.

     

    8.  Cancellation.
      After all Principal of, and accrued interest at any time owed on, this Note
      have
      been paid in full, this Note will be surrendered to the Debtor for cancellation
      and will not be reissued.

     

    9.  Governing Law.
      This Note shall be governed by and construed in accordance with the domestic
      laws of the State of New York, without giving effect to any choice of law or
      conflict of law provision or rule (whether of the State of New York or any
      other
      jurisdiction) that would cause the application of the laws of any jurisdiction
      other than the State of New York.

     

    10.  Waiver
      of Jury Trial.
      The
      parties hereto waive their right to a trial by jury for any claims arising
      out
      of or related to this Note.

     

    11.  Further
      Assurances.
      Debtor
      shall, from time to time, execute, acknowledge and deliver, or cause to be
      executed, acknowledged and delivered, such supplements hereto and such further
      instruments as may reasonably be required for carrying out the intention of
      or
      facilitating the performance of this Note.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the Debtor has executed and delivered this Note on the date
      first written above.

     

    
      	 	 	 
	 	
              ASTON
                ASSET MANAGEMENT LLC

            
	 
 	 
 	 
 
	 	By:  	/s/ Stuart
              D.
              Bilton 
	 	
              
Stuart
              D. Bilton
	 	Chairman
              and Chief Executive Officer 

    

    
      	 	 	 
	 	 
	 
 	 
 	 
 
	 	By:  	/s/ Richard
              S. Foote
	 	
              
Richard
              S. Foote
	 	
              President
                and Chief Executive Officer, 

              Highbury
                Financial Inc., as manager member 

              of
                Aston Asset Management LLC

            

    

     

    
      	HIGHBURY FINANCIAL INC.	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	By:	/s/ R.
              Bradley Forth	 	 	 
	 	
              
R.
              Bradley Forth	 	 	
            
	 	
              Executive
                Vice PresidentExhibit
        10.1

    Ethanex
      Energy, Inc.

    

    Omnibus
      Equity Incentive Plan

    

    1.  
Purpose.
      The
      purpose of the Ethanex Energy, Inc. Omnibus Equity Incentive Plan (the “Plan”)
      is to further the long term stability and financial success of Ethanex Energy,
      Inc. (the “Company”) by retaining and attracting key employees, non-employee
      directors and consultants of the Company and its affiliates, through the use
      of
      equity incentives. It is believed that ownership of Company Stock will stimulate
      the efforts of those employees, consultants and directors upon whose efforts,
      interest and judgment the Company is and will be largely dependent for success.
      It is also believed that Incentive Awards granted to employees and directors
      under this Plan will strengthen their desire to remain with the Company and
      will
      further identify their interests with the interests of the Company’s
      stockholders. The Plan is intended to conform to the provisions of Securities
      and Exchange Commission Rule 16b-3.

     

    2.  
Definitions.
      As used
      in the Plan, the following terms have the meanings indicated:

     

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

     

    (b)  “Applicable
      Withholding Taxes” means the minimum aggregate amount of federal, state and
      local income and payroll taxes that the Company is required by applicable law
      to
      withhold in connection with any Incentive Award.

     

    (c)  “Board”
      means the board of directors of the Company.

     

    (d)  “Cause”
      shall have the same meaning given to such term (or other term of similar
      meaning) in an employment agreement, if any, between the Company and the
      Participant for purposes of termination of employment under such agreement,
      and
      in the absence of any such agreement or if such agreement does not include
      a
      definition of “Cause” (or other term of similar meaning), the term “Cause” shall
      mean (i) any material breach by the Participant of any agreement to which the
      Participant and the Company or an affiliate are parties, (ii) any continuing
      act
      or omission to act by the Participant which may have a material and adverse
      effect on the Company’s business or on the Participant’s ability to perform
      services for the Company or an affiliate, including, without limitation, the
      commission of any crime (other than minor traffic violations), or (iii) any
      material misconduct or material neglect of duties by the Participant in
      connection with the business or affairs of the Company or an
      affiliate.

     

    (e)  “Change
      of Control” and “Change in Control” both mean, unless such term or an equivalent
      term is otherwise defined with respect to an award by the Participant’s award
      agreement, any Employment Agreement or in a written contract of service, the
      occurrence of any of the following:

     

    (i)  any
      “person” (as such term is used in Sections 13(d) and 14(d) of the Act)
      becomes the “beneficial owner” (as defined in Rule 13d-3 promulgated under
      the Act), directly or indirectly, of securities of the Company representing
      more
      than fifty percent (50%) of the total combined voting power of the Company’s
      then-outstanding securities entitled to vote generally in the election of Board
      members (“Directors”); provided, however, that the following acquisitions shall
      not constitute a Change in Control: (1) an acquisition by any such person
      who on the Effective Date is the beneficial owner of more than fifty percent
      (50%) of such voting power, (2) any acquisition directly from the Company,
      including, without limitation, a public offering of securities, (3) any
      acquisition by the Company, (4) any acquisition by a trustee or other
      fiduciary under an employee benefit plan of a Participating Company or
      (5) any acquisition by an entity owned directly or indirectly by the
      stockholders of the Company in substantially the same proportions as their
      ownership of the voting securities of the Company; or

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (ii)  an
      Ownership Change Event or series of related Ownership Change Events
      (collectively, a “Transaction”) in which the stockholders of the Company
      immediately before the Transaction do not retain immediately after the
      Transaction direct or indirect beneficial ownership of more than fifty percent
      (50%) of the total combined voting power of the outstanding securities entitled
      to vote generally in the election of Directors or, in the case of an Ownership
      Change Event described in Section 2(t)(iii), the entity to which the assets
      of
      the Company were transferred (the “Transferee”), as the case may be;
      or

     

    (iii)  a
      liquidation or dissolution of the Company;

     

    provided,
      however, that a Change in Control shall be deemed not to include a transaction
      described in subsections (i) or (ii) of this Section in which a majority of
      the
      Directors of the continuing, surviving or successor entity, or parent thereof,
      immediately after such transaction is comprised of incumbent Directors. For
      purposes of the preceding sentence, indirect beneficial ownership shall include,
      without limitation, an interest resulting from ownership of the voting
      securities of one or more corporations or other business entities which own
      the
      Company or the transferee, as the case may be, either directly or through one
      or
      more subsidiary corporations or other business entities. The Committee shall
      have the right to determine whether multiple sales or exchanges of the voting
      securities of the Company or multiple Ownership Change Events are related,
      and
      its determination shall be final, binding and conclusive.

     

    

    (f)  “Code”
      means the Internal Revenue Code of 1986, as amended. A reference to any
      provision of the Code shall include reference to any successor or replacement
      provision of the Code.

     

    (g)  “Committee”
      means the committee appointed by the Board (as described in Section 14), or
      the
      entire Board if no committee is appointed.

     

    (h)  “Company”
      means Ethanex Energy, Inc.

     

    (i)  “Company
      Stock” means the common Stock, par value $0.001 per share, of the Company. In
      the event of a change in the capital structure of the Company the shares
      resulting from such a change shall be deemed to be Company Stock within the
      meaning of the Plan.

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    (j)  “Consultant”
      means any individual, including an advisor, engaged by the Company (or a Parent
      or Subsidiary of the Company) to render consulting or advisory services and
      who
      is compensated for such services.

     

    (k)  “Date
      of
      Grant” means the date on which an Incentive Award is granted by the Committee or
      such later date specified by the Committee as the date as of which the grant
      of
      the Incentive Award is to be effective.

     

    (l)  “Disability”
      or “Disabled” means, a disability within the meaning of Code Section 22(e)(3).

     

    (m)  “Employee”
      means an individual employed by the Company or the Parent or a Subsidiary of
      the
      Company.

     

    (n)  “Fair
      Market Value” means, on
      any given date the fair market value of Company Stock as of such date, as
      determined by the Committee in good faith. If the Company Stock is listed on
      a
      national securities exchange or traded on the over-the-counter market, Fair
      Market Value means the closing selling price or, if not available, the closing
      bid price or, if not available, the high bid price of the Company Stock quoted
      on such exchange, or on the over-the-counter market as reported by the NASDAQ
      Stock Market (“NASDAQ”) or the Over-the-Counter Bulletin Board (“OTCBB”), or if
      the Company Stock is not listed on NASDAQ or quoted on the OTCBB, then by the
      National Quotation Bureau, Incorporated, on the day immediately preceding the
      day on which the award is granted or exercised, as the case may be, or, if
      there
      is no selling or bid price on that day, the closing selling price, closing
      bid
      price, or high bid price on the most recent day which precedes that day and
      for
      which such prices are available.
      

     

    (o)  “Incentive
      Award” means, collectively, an award of Restricted Stock or an Option granted
      under the Plan.

     

    (p)  “Mature
      Shares” means Company Stock for which the holder thereof has good title, free
      and clear of all liens and encumbrances and which such holder either (i) has
      held for at least six months or (ii) has purchased on the open
      market.

     

    (q)  “Non-Employee
      Director” means a member of the Board who is not an Employee of the Company or
      the Parent or a Subsidiary of the Company.

     

    (r)  “Nonstatutory
      Share Option” means an Option which does not meet the requirements for a
      statutory share option under Code Section 422, or even if meeting the
      requirements of Code Section 422 is not intended to be a statutory share
      option.

     

    (s)  “Option”
      means a right to purchase Company Stock granted under the Plan, at a price
      determined in accordance with the Plan.

     

    (t)  “Ownership
      Change Event” means the occurrence of any of the following with respect to the
      Company: (i) the direct or indirect sale or exchange in a single or series
      of related transactions by the stockholders of the Company of more than fifty
      percent (50%) of the voting stock of the Company; (ii) a merger or
      consolidation in which the Company is a party; or (iii) the sale, exchange,
      or transfer of all or substantially all of the assets of the Company (other
      than
      a sale, exchange or transfer to one or more subsidiaries of the
      Company).

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    (u)  “Parent”
      means, with respect to any corporation, a parent of that corporation within
      the
      meaning of Code Section 424(e).

     

    (v)  “Participant”
      means an Employee, Non-Employee Director or consultant who receives an Incentive
      Award under the Plan.

     

    (w)  “Publicly
      Traded” means a registration statement with respect to Company Stock that was
      filed by the Company with the Securities and Exchange Commission has become
      effective.

     

    (x)  “Restricted
      Stock” means Company Stock awarded upon the terms and subject to the
      restrictions set forth in Section 6.

     

    (y)  “Rule
      16b-3” means Rule 16b-3 of the Securities and Exchange Commission promulgated
      under the Act. A reference in the Plan to Rule 16b-3 shall include a reference
      to any corresponding rule (or number redesignation) of any amendment to Rule
      16b-3 enacted after the effective date of the Plan’s adoption. The provisions of
      the Plan relating to Rule 16b-3 shall be applicable only if the Company Stock
      becomes Publicly Traded. 

     

    (z)  “Subsidiary”
means,
      with respect to any corporation, a subsidiary of that
      corporation within the meaning of Code Section 424(f).

     

    (aa)  “10%
      Stockholder” means a person who owns, directly or indirectly, shares possessing
      more than 10% of the total combined voting power of all classes of the capital
      stock of the Company or any Parent or Subsidiary of the Company. Indirect
      ownership of capital stock or the combined voting power of all classes of
      capital stock shall be determined in accordance with Code Section
      424(d).

     

    (bb)  “Taxable
      Year” means the fiscal period used by the Company for reporting taxes on income
      under the Code.

     

    3.   General.
      Incentive Awards may be granted under the Plan in the form of: Restricted Stock
      and Nonstatutory Stock Options.

     

    4.   Stock
      Reserved.
      Subject
      to Section 13 of the Plan, there shall be reserved for issuance under the Plan
      an aggregate of 7,500,000 shares of Company Stock, which shall be authorized
      but
      unissued shares.
      Shares
      allocable to Incentive Awards or portions thereof granted under the Plan that
      expire or otherwise terminate unexercised may again be subjected to an Incentive
      Award under the Plan. The Committee is expressly authorized to make an Incentive
      Award to a Participant conditioned upon the surrender for cancellation of an
      existing Incentive Award. For purposes of determining the number of shares
      that
      are available for Incentive Awards under the Plan, such number shall include
      the
      number of shares under an Incentive Award surrendered by a Participant or
      retained by the Company in payment of Applicable Withholding Taxes.

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    5.  
Eligibility.

     

    (a)  Any
      Employee, Non-Employee Director or Consultant of the Company (or Parent or
      Subsidiary of the Company) who, in the judgment of the Committee has contributed
      or can be expected to contribute to the profits or growth of the Company (or
      Parent or Subsidiary of the Company) shall be eligible to receive Incentive
      Awards under the Plan. The Committee shall have the power and complete
      discretion, as provided in Section 14, to select eligible Employees to receive
      Incentive Awards and to determine for each Employee the terms and conditions,
      the nature of the award and the number of shares to be allocated to each
      Employee as part of each Incentive Award. Both the Board and the Committee
      shall
      have the power and complete discretion, as provided in Section 14, to select
      eligible Non-Employee Directors and Consultants to receive Incentive Awards
      and
      to determine for each Non-Employee Director or Consultant the nature of the
      award and the terms and conditions of each Incentive Award.

     

    (b)  The
      grant
      of an Incentive Award shall not obligate the Company or any Parent or Subsidiary
      of the Company to pay an Employee, Non-Employee Director or Consultant any
      particular amount of remuneration, to continue the employment of the Employee
      after the grant or to make further grants to the Employee, Non-Employee Director
      or Consultant at any time thereafter.

     

    (c)  Anything
      to the contrary notwithstanding, any recipient of an Incentive Award under
      the
      Plan must be includable in the definition of “employee” provided in the general
      instructions to Form S-8 Registration Statement under the Securities Act of
      1933, as amended.

     

    6.  
Restricted
      Stock Awards.

     

    (a)  The
      Committee may make grants of Restricted Stock to Participants. Whenever the
      Committee deems it appropriate to grant Restricted Stock, written or electronic
      notice shall be given to the Participant stating the number of shares of
      Restricted Stock granted and the terms and conditions to which the Restricted
      Stock are subject. This notice, when accepted in writing by the Participant
      shall become an award agreement between the Company and the Participant and
      certificates representing the shares shall be issued and, unless otherwise
      provided in the award agreement, delivered to the Participant. 

     

    (b)  No
      Restricted Stock may be sold, assigned, transferred, pledged, hypothecated,
      or
      otherwise encumbered or disposed of until the restrictions on such shares as
      set
      forth in the Participant’s award agreement (which may include rights of
      repurchase) have lapsed or been removed pursuant to paragraph (d) or (e)
      below.

     

    (c)  Upon
      the
      acceptance by a Participant of an award of Restricted Stock, such Participant
      shall, subject to the restrictions set forth in paragraph (b) above, have all
      the rights of a stockholder with respect to such Restricted Stock, including,
      but not limited to, the right to vote such Restricted Stock and the right to
      receive all dividends and other distributions paid thereon. Certificates
      representing Restricted Stock shall bear a legend referring to the restrictions
      set forth in the Plan and the Participant’s award agreement. Any dividends or
      other distributions on Restricted Stock shall be paid no later than the end
      of
      the calendar year in which the dividends or other distributions are paid to
      stockholders of that class of Company Stock or, if later, the fifteenth day
      of
      the third month following the date on which the dividends or other distributions
      are paid to stockholders of that class.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    (d)  The
      Committee shall establish as to each award of Restricted Stock the terms and
      conditions upon which the restrictions set forth in paragraph (b) above shall
      lapse. Such terms and conditions may include, without limitation, the lapsing
      of
      such restrictions as a result of the Disability, death or retirement of the
      Participant or the occurrence of a Change of Control.

     

    (e)  Notwithstanding
      the provisions of paragraph (b) above, the Committee may at any time, in its
      sole discretion, accelerate the time at which any or all restrictions will
      lapse
      or remove any and all such restrictions.

     

    (f)  Each
      Employee shall agree at the time his or her shares of Restricted Stock are
      granted, and as a condition thereof, to pay to the Company, or make arrangements
      satisfactory to the Company regarding the payment to the Company of, Applicable
      Withholding Taxes. Until such amount has been paid or arrangements satisfactory
      to the Company have been made, no Company Stock certificate free of a legend
      reflecting the restrictions set forth in paragraph (b) above shall be issued
      to
      such Participant. As an alternative to making a cash payment to the Company
      to
      satisfy Applicable Withholding Taxes, if the grant so provides, the Employee
      may
      elect to (i) deliver Mature Shares or (ii) have the Company retain that number
      of shares of Company Stock that would satisfy all or a specified portion of
      the
      Applicable Withholding Taxes. 

     

    7.  
Stock
      Options.

     

    (a)  Whenever
      the Committee deems it appropriate to grant Options, written or electronic
      notice shall be given to the eligible person stating the number of shares for
      which Options are granted and the Option price per share. All Options shall
      be
      Nonstatutory Stock Options, regardless as to whether or not they satisfy the
      conditions for incentive stock option treatment under Code Section 422 and
      the
      regulations thereunder. This notice, when duly accepted in writing by the
      Participant, shall become an award agreement between the Company and the
      Participant.

     

    (b)  The
      exercise price of Company Stock covered by an Option shall be not less than
      100%
      of the Fair Market Value of such shares on the Date of Grant and shall never
      become less than 100% of the Fair Market Value of such shares on the Date of
      Grant. 

     

    (c)  Options
      may be exercised in whole or in part at such times as may be specified by the
      Committee in the Participant’s award agreement.

     

    (d)  The
      Committee may, in its discretion, grant Options that by their terms become
      fully
      exercisable upon a Change of Control, notwithstanding other conditions on
      exercisability in the award agreement.

     

    8.  
Method
      of Exercise of Options.

     

    (a)  Options
      may be exercised by the Participant by giving written or electronic notice
      (as
      specified by the Committee) of the exercise to the Company, stating the number
      of shares the Participant has elected to purchase under the Option. In the
      case
      of the purchase of shares under an Option, such notice shall be effective only
      if accompanied by the exercise price in full in cash; provided, however, that
      if
      the terms of an Option, or the Committee by separate action, so permits, the
      Participant may (i) deliver Mature Shares (valued at their Fair Market Value
      on
      the date of exercise) in satisfaction of all or part of the exercise price,
      (ii)
      have the Company retain that number of shares of Company Stock (valued at their
      Fair Market Value on the date of exercise) that would satisfy all or a specified
      portion of the exercise price or (iii) deliver a properly executed exercise
      notice together with irrevocable instructions to a broker to deliver promptly
      to
      the Company, from the sale of Company Stock, or otherwise, the amount necessary
      to pay the exercise price and Applicable Withholding Taxes.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    (b)  The
      Company may place on any certificate representing Company Stock issued upon
      the
      exercise of an Option any legend deemed desirable by the Company’s counsel to
      comply with federal or state securities laws, and the Company may require a
      customary written indication of the Participant’s investment intent. Until the
      Participant has made any required payment, including payment of any Applicable
      Withholding Taxes, and has had issued a certificate for the Company Stock
      acquired, the Participant shall possess no stockholder rights with respect
      to
      the shares.

     

    (c)  Each
      Participant shall agree as a condition of the exercise of an Option to pay
      to
      the Company Applicable Withholding Taxes, or make arrangements satisfactory
      to
      the Company regarding the payment to the Company of such amounts. Until
      Applicable Withholding Taxes have been paid or arrangements satisfactory to
      the
      Company have been made, no Share certificate shall be issued upon the exercise
      of an Option.

     

    (d)  As
      an
      alternative to making a cash payment to the Company to satisfy Applicable
      Withholding Taxes, if the Option agreement so provides, or the Committee by
      separate action so provides, a Participant may, subject to the provisions set
      forth below, elect to (i) deliver Mature Shares (valued at their Fair Market
      Value on the date of exercise) or (ii) have the Company retain that number
      of
      shares of Company Stock (valued at their Fair Market Value on the date of
      exercise) that would satisfy all or a specified portion of the Applicable
      Withholding Taxes.

     

    (e)  Notwithstanding
      anything herein to the contrary, if the Company Stock is Publicly Traded,
      Options shall always be granted and exercised in such a manner as to conform
      to
      the provisions of Rule 16b-3.

     

    9.  
Nontransferability
      of Awards.
      Options
      and Restricted Stock shall not be transferable except by will or by the laws
      of
      descent and distribution, and shall be exercisable during the Participant’s
      lifetime only by the Participant. 

     

    10.  
Material
      Modification of Options Prohibited.
      

     

    (a)  Notwithstanding
      any provision of this Plan or any Option agreement to the contrary, no
      Modification shall be made in respect to any Option, if such Modification would
      result in the Option constituting a deferral of compensation or having an
      additional deferral feature within the meaning of applicable Treasury
      Regulations under Code Section 409A. 

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    (b)  Subject
      to Subsection (c), below, a “Modification” for purposes of Subsection (a)
      shall mean any change in the terms of the Option (or change in the terms of
      the
      Plan or applicable Option agreement) that may provide the holder of the Option
      with a direct or indirect reduction in the exercise price of the Option, or
      an
      additional deferral feature, or an extension or renewal of the Option,
      regardless of whether the holder in fact benefits from the change in terms.
      An
      extension of an Option refers to the granting to the holder of an additional
      period of time within which to exercise the Option beyond the time originally
      prescribed. A renewal of an Option is the granting by the Company of the same
      rights or privileges contained in the original Option on the same terms and
      conditions. 

     

    (c)  Notwithstanding
      Subsection (b), above, it is not a Modification to change the terms of an Option
      in any of the ways or for any of the purposes specifically described in
      applicable Treasury Regulations under Code Section 409A as not resulting in
      a
      modification, extension or renewal of a stock right, or the granting of a new
      stock right, for purposes of that section.

     

    11.  
Effective
      Date of the Plan.
      This
      Plan shall be effective on December 1, 2006.

     

    12.  
Termination,
      Modification, Change.
      If not
      sooner terminated by the Board, this Plan shall terminate at the close of the
      business day that is the day immediately preceding the ten-year anniversary
      of
      the effective date (as provided in Section 11). No Incentive Awards shall be
      made under the Plan after its termination. The Board may terminate the Plan
      or
      may amend the Plan in such respects as it shall deem advisable. Notwithstanding
      the foregoing, the Board may amend the Plan and unilaterally amend Incentive
      Awards as it deems appropriate to ensure compliance with applicable federal
      or
      state securities laws or regulations thereunder, or any applicable Nasdaq or
      other securities exchange listing requirement. Except as provided in the
      preceding sentence, a termination or amendment of the Plan shall not, without
      the consent of the Participant, detrimentally affect a Participant’s rights
      under an Incentive Award previously granted to the Participant.

     

    13.  
Change
      in Capital Structure

     

    (a)  Subject
      to Section 10, above, in the event of a stock dividend, stock split or
      combination of shares, recapitalization, merger in which the Company is the
      surviving corporation, reorganization, reincorporation, consolidation, or other
      change in the Company’s capital stock without the receipt of consideration by
      the Company (including, but not limited to, the creation or issuance to
      stockholders generally of rights, options or warrants for the purchase of
      Company Stock or preferred stock of the Company), the number and kind of shares
      or securities of the Company to be subject to the Plan and to Incentive Awards
      then outstanding or to be granted thereunder, the maximum number of shares
      or
      securities which may be delivered under the Plan pursuant to Section 4, and
      the
      exercise price and other terms and relevant provisions of Incentive Awards
      shall
      be automatically adjusted by the Committee so as to preserve each Participant’s
      proportionate interest immediately prior to such event. The determination of
      the
      Committee shall be binding on all persons. If the adjustment would produce
      fractional shares with respect to any Restricted Stock or unexercised Option,
      the Committee may adjust appropriately the number of shares covered by the
      Incentive Award so as to eliminate the fractional shares.

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    (b)  If
      the
      Company is a party to a consolidation or a merger in which the Company is not
      the surviving corporation, a transaction that results in the acquisition of
      substantially all of the Company’s outstanding stock by a single person or
      entity, or a sale or transfer of substantially all of the Company’s assets, the
      Committee may take such actions with respect to outstanding Incentive Awards
      as
      the Committee deems appropriate.

     

    (c)  Notwithstanding
      anything in the Plan to the contrary, the Committee may take the foregoing
      actions without the consent of any Participant, and the Committee’s
      determination shall be conclusive and binding on all persons for all
      purposes.

     

    14.  
Administration of the Plan.
      The Plan
      shall be administered by the Committee. The Committee shall consist of not
      less
      than two members of the Board, who shall be appointed by the Board. Subject
      to
      paragraph (d) below, if the Company Stock is Publicly Traded, the Committee
      shall be the Compensation Committee of the Board unless the Board shall appoint
      another Committee to administer the Plan. The Committee shall have general
      authority to impose any limitation or condition upon an Incentive Award the
      Committee deems appropriate to achieve the objectives of the Incentive Award
      and
      the Plan and, without limitation and in addition to powers set forth elsewhere
      in the Plan, shall have the following specific authority:

     

    (a)  The
      Committee shall have the power and complete discretion to determine
      (i) which eligible persons shall receive Incentive Awards and the nature of
      each Incentive Award, (ii) the number of shares of Company Stock to be
      covered by each Incentive Award, (iii) the Fair Market Value of Company
      Stock, (iv) the time or times when an Incentive Award shall be granted,
      (v) whether an Incentive Award shall become vested over a period of time
      and when it shall be fully vested, (vi) when Options may be exercised,
      (vii) whether a Disability exists, (viii) the manner in which payment
      will be made upon the exercise of Options, (ix) conditions relating to the
      length of time before disposition of Company Stock received upon the exercise
      of
      Options is permitted, (x) whether to approve a Participant’s election (A)
      to deliver Mature Shares to satisfy Applicable Withholding Taxes or (B) to
      have
      the Company withhold from the shares to be issued upon the exercise of a
      Nonstatutory Share Option the number of shares necessary to satisfy Applicable
      Withholding Taxes, (xi) notice provisions relating to the sale of Company
      Stock acquired under the Plan, (xii) when Incentive Awards may be forfeited
      or
      expire, and (xiv) any additional requirements relating to Incentive Awards
      that the Committee deems appropriate. Subject to Section 10, above, the
      Committee shall have the power to amend the terms of previously granted
      Incentive Awards so long as the terms as amended are consistent with the terms
      of the Plan and provided that the consent of the Participant is obtained with
      respect to any amendment that would be detrimental to him or her, except that
      such consent will not be required if such amendment is for the purpose of
      complying with Rule 16b-3 or any requirement of the Code or Act applicable
      to
      the Incentive Award.

     

    (b)  The
      Committee may adopt rules and regulations for carrying out the Plan. The
      interpretation and construction of any provision of the Plan by the Committee
      shall be final and conclusive. The Committee may consult with counsel, who
      may
      be counsel to the Company, and shall not incur any liability for any action
      taken in good faith in reliance upon the advice of counsel.

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    (c)  A
      majority of the members of the Committee shall constitute a quorum, and all
      actions of the Committee shall be taken by a majority of the members present.
      Any action may be taken by a written instrument signed by all of the members,
      and any action so taken shall be fully effective as if it had been taken at
      a
      meeting.

     

    (d)  The
      Board
      from time to time may appoint members previously appointed and may fill
      vacancies, however caused, in the Committee. If a committee of the Board is
      appointed to serve as the Committee, such Committee shall have, in connection
      with the administration of the Plan, the powers possessed by the Board,
      including the power to delegate to a subcommittee any of the administrative
      powers the Committee is authorized to exercise, subject, however, to such
      resolutions, not inconsistent with the provisions of the Plan, as may be adopted
      from time to time by the Board.

     

    (e)  With
      respect to Non-Employee Directors, the Board or the Committee shall be
      authorized to make grants of Restricted Stock and Nonstatutory Stock Options
      in
      its discretion, provided such grants are made in compliance with other
      provisions of the Plan. In such case, the Board shall hold the same general
      and
      specific authority granted to the Committee under this Section 14 and other
      provisions of the Plan.

     

    15.  
Notice.
      All
      notices and other communications required or permitted to be given in writing
      under this Plan shall be deemed to have been duly given if delivered personally
      or mailed first class, postage prepaid, as follows (a) if to the Company—at its
      principal business address to the attention of the Chief Financial Officer;
      (b)
      if to any Participant—at the last address of the Participant known to the sender
      at the time the notice or other communication is sent.

     

    16.  
Stockholder
      Rights.
      No
      Participant shall be deemed to be the holder of, or to have any of the rights
      of
      a holder with respect to, any Company Stock subject to an Incentive Award unless
      and until such Participation has satisfied all requirements under the terms
      of
      the Incentive Award.

     

    17.  
No
      Employment or other Service Rights.
      Nothing
      in the Plan or any instrument executed or Incentive Award granted under the
      Plan
      shall confer upon any Participant any right to continue to serve the Company
      (or
      a Parent or Subsidiary of the Company) in the capacity in effect at the time
      the
      Incentive Award was granted or shall affect the right of the Company (or a
      Parent or Subsidiary of the Company) to terminate (i) the employment of an
      Employee with or without notice and with or without cause, (ii) the service
      of a
      Consultant pursuant to the terms of such Consultant’s agreement with the Company
      (or a Parent or Subsidiary of the Company) or (iii) the service of a
      Non-Employee Director pursuant to the bylaws of the Company (or a Parent or
      Subsidiary of the Company), and any applicable provisions of the corporate
      law
      of the state in which the Company (or a Parent or Subsidiary of the Company)
      is
      incorporated, as the case may be.

     

    18.  
Options
      Granted to Non-Exempt Employees.
      Any
      Option granted to an Employee who is a nonexempt Employee for purposes of the
      Fair Labor Standards Act of 1938 (the “FLSA”) shall not be exercisable by the
      Employee for a period of at least six months after the Date of Grant, to the
      extent required under the FLSA for such Option to be excluded from the
      Employee’s “regular rate” (as defined under the FLSA). The Committee may impose
      such other conditions or limitations on Options granted to nonexempt Employees
      as it may deem appropriate to qualify such Options for exemption from such
      Employees’ regular rate under the FLSA.

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    19.  Interpretation.
      The
      terms of the Plan shall be governed by the laws of New York, without regard
      to
      the conflict of law provisions of any jurisdiction. The terms of this Plan
      are
      subject to all present and future regulations and rulings of the Secretary
      of
      the Treasury or his delegate relating to the qualification of Incentive Stock
      Options under the Code. If any provision of the Plan conflicts with any such
      regulation or ruling, then that provision of the Plan shall be void and of
      no
      effect.

     

    IN
      WITNESS WHEREOF, this instrument has been executed this 1st
      day of
      December, 2006.

     

    
      	 	 	 
	 	Ethanex
              Energy,
              Inc.
	 
 	 
 	 
 
	 	By:  	/s/ Albert
              W.
              Knapp, III
	 	
              

              Albert
                W. Knapp, III

              President
                and Chief Executive Officer

            

    

    
      
         

      

      
        11

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