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    EXHIBIT
10.1

     

    VIVAKOR,
INC.

    2008 INCENTIVE
PLAN

    

    

    SECTION 1

    

    GENERAL
PROVISIONS RELATING TO

    PLAN
GOVERNANCE, COVERAGE AND BENEFITS

    

    1.1 Purpose

    

    The
purpose of the 2008 Incentive Plan (the “Plan”) is to foster and
promote the long-term financial success of VivaKor, Inc. (the “Company”) and its Subsidiaries
and to increase stockholder value by: (a) encouraging the commitment of selected
key Employees, Consultants and Outside Directors, (b) motivating superior
performance of key Employees, Consultants and Outside Directors by means of
long-term performance related incentives, (c) encouraging and providing
key Employees, Consultants and Outside Directors with a program for
obtaining ownership interests in the Company which link and align their
personal interests to those of the Company’s stockholders, (d) attracting and
retaining key Employees, Consultants and Outside Directors by providing
competitive incentive compensation opportunities, and (e) enabling key
Employees, Consultants and Outside Directors to share in the long-term growth
and success of the Company.

     

    The Plan
provides for payment of various forms of incentive compensation. It is not
intended to be a plan that is subject to the Employee Retirement Income Security
Act of 1974, as amended (ERISA). The Plan will be interpreted, construed and
administered consistent with its status as a plan that is not subject to
ERISA.

     

    The Plan
was originally effective on October 23, 2008, subject to approval by the
Company’s stockholders pursuant to Section 7.1 (the
“Effective Date”),
provided that with respect to Incentive Awards outstanding prior to the
Effective Date, such an award shall not be amended by any term herein if such
term would cause such award to be deferred compensation, a new grant under or
otherwise violate Code Section 409A or would modify an Incentive Award
under Code Section 424 resulting in a new grant, as determined by the
Committee. The Plan will remain in effect, subject to the right of the Board to
amend or terminate the Plan at any time pursuant to Section 7.7,
until all Shares subject to the Plan have been purchased or acquired
according to its provisions. However, in no event may an Incentive Award be
granted under the Plan after the expiration of ten (10) years from the
Effective Date.

    

    1.2 Definitions

    

     The
following terms shall have the meanings set forth below:

    

    
      
        
        

      

      
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    (a)  Appreciation.
The difference between the option exercise price per share of the Nonstatutory
Stock Option to which a Tandem SAR relates and the Fair Market Value of a share
of Common Stock on the date of exercise of the Tandem SAR.

    

    (b)  Authorized
Officer. The Chairman of the Board, the CEO or any other senior officer
of the Company to whom either of them delegate the authority to execute any
Incentive Agreement for and on behalf of the Company.  No officer or
director shall be an Authorized Officer with respect to any
Incentive Agreement for himself.

    

    (c)  Board.
The Board of Directors of the Company.

    

    (d) Cause. When used in connection with
the termination of a Grantee’s Employment, shall mean the termination of the
Grantee’s Employment by the Company or any Subsidiary by reason of (i) the
conviction of the Grantee by a court of competent jurisdiction as to which no
further appeal can be taken of a crime involving moral turpitude or a felony;
(ii) the proven commission by the Grantee of a material act of fraud upon
the Company or any Subsidiary, or any customer or supplier thereof;
(iii) the misappropriation of any funds or property of the Company or any
Subsidiary, or any customer or supplier  thereof; (iv) the
willful, continued and unreasonable failure by the Grantee to perform the
material duties assigned to him that is not cured to the reasonable satisfaction
of the Company within 30 days after written notice of such failure is
provided to Grantee by the Board or CEO (or by another officer of the Company or
a Subsidiary who has been designated by the Board or CEO for such purpose);
(v) the knowing engagement by the Grantee in any direct and material
conflict of interest with the Company or any Subsidiary without compliance with
the Company’s or Subsidiary’s conflict of interest policy, if any, then in
effect; or (vi) the knowing engagement by the Grantee, without the written
approval of the Board or CEO, in any material activity which competes
with the business of the Company or any Subsidiary or which would result in
a material injury to the business, reputation or goodwill of the Company or any
Subsidiary.

    

    (e) CEO. The Chief Executive Officer
of the Company.

    

    (f) Code.
The Internal Revenue Code of 1986, as amended, and the regulations and other
authority promulgated thereunder by the appropriate governmental authority.
References herein to any provision of the Code shall refer to any successor
provision thereto.

    

    (g)  Committee. A committee appointed by the
Board consisting of at least one member as appointed by the Board to administer
the Plan. However, if the Company becomes a Publicly Held Corporation, the Plan
shall be administered by a committee appointed by the Board consisting of not
less than two directors who (i) fulfill the “non-employee director”
requirements of Rule 16b-3 under the Exchange Act and who is certified by
the Board as an independent director and (ii) fulfill the “outside
director” requirements of Section 162(m) of the Code. In either case, the
Committee may be the compensation committee of the Board, or any subcommittee of
the compensation committee, provided that the members of the Committee
satisfy the requirements of the previous provisions of this
paragraph.

    

    
      
        
        

      

      
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    The Board
shall have the power to fill vacancies on the Committee arising by
resignation, death, removal or otherwise.  The Board, in its sole
discretion, may bifurcate the powers and duties of the Committee among one or
more separate committees, or retain all powers and duties of the Committee in a
single Committee. The members of the Committee shall serve at the discretion of
the Board.

     

    Notwithstanding
the preceding paragraphs of this Section 1.2(g),
the term “Committee” as used in the Plan shall mean the entire Board prior
to the time a Committee has been established by the Board and with respect to
any proposed grant of an Incentive Award for an Outside Director. In such cases,
the Board shall have all the powers and responsibilities of the Committee
hereunder, and any actions as to such Incentive Award may be acted upon
only by the Board (unless it otherwise designates in its discretion). When
the Board exercises its authority to act in the capacity as the Committee
hereunder with respect to an Incentive Award for an Outside Director, it shall
so designate with respect to any action that it undertakes in its capacity
as the Committee.

    

    (h) Common
Stock. The common
stock of the Company, $0.001 par value per share, and any class of common stock
into which such common shares may hereafter be converted, reclassified or
recapitalized.

    

    (i) Company. VivaKor, Inc., a corporation
organized under the laws of the State of Nevada, and any successor in
interest thereto

    

    (j)  Consultant. An independent agent,
consultant, attorney, an individual who has agreed to become an Employee within
the next six months, or any other individual who is not an Outside Director or
employee of the Company (or any Parent or Subsidiary) and who, in the opinion of
the Committee, (i) is in a position to contribute to the growth or financial
success of the Company (or any Parent or Subsidiary), (ii) is a
natural person and (iii) provides bona fide services to the Company (or any
Parent or Subsidiary), which services are not in connection with the offer or
sale of securities in a capital raising transaction, and do not directly or
indirectly promote or maintain a market for the Company’s
securities.

    

    (k)  Change in
Control. Any of
the events described in and subject to Section 6.7

    

    (l) Covered
Employee. A named
executive officer who is one of the group of covered employees, as defined in
Section 162(m) of the Code and Treasury Regulation § 1.162-27(c) (or its
successor), during any such period that the Company is a Publicly Held
Corporation.

    

    
      
        
        

      

      
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    (m)  Deferred
Stock. Shares of
Common Stock to be issued or transferred to a Grantee under an Other Stock-Based
Award granted pursuant to Section 5 at the
end of a specified deferral period, as set forth in the Incentive Agreement
pertaining thereto.

    

    (n) Disability. As determined by the
Committee in its discretion exercised in good faith, a physical or mental
condition of the Employee that would entitle him to payment of disability
income payments under the Company’s long term disability insurance policy
or plan for employees, as then effective, if any; or in the event that the
Grantee is not covered, for whatever reason, under the Company’s long-term
disability insurance policy or plan, “Disability” means a permanent and total
disability as defined in Section 22(e)(3) of the Code. A determination of
Disability may be made by a physician selected or approved by the Committee and,
in this respect, the Grantee shall submit to any reasonable examination by such
physician upon request.

    

    (o)  Employee. Any employee of the Company
(or any Parent or Subsidiary) within the meaning of Section 3401(c) of the Code
who, in the opinion of the Committee, is in a position to contribute to the
growth, development or financial success of the Company (or any Parent or
Subsidiary), including, without limitation, officers who are members of the
Board.

    

    (p) Employment. Employment by the Company
(or any Parent or Subsidiary), or by any corporation issuing or assuming an
Incentive Award in any transaction described in Section 424(a) of the Code, or
by a parent corporation or a subsidiary corporation of such corporation
issuing or assuming such Incentive Award, as the parent-subsidiary relationship
shall be determined at the time of the corporate action described in Section
424(a) of the Code. In this regard, neither the transfer of a Grantee from
Employment by the Company to Employment by any Parent or Subsidiary, nor
the transfer of a Grantee from Employment by any Parent or Subsidiary to
Employment by the Company, shall be deemed to be a termination of Employment of
the Grantee. Moreover, the Employment of a Grantee shall not be deemed to have
been terminated because of an approved leave of absence from active Employment
on account of temporary illness, authorized vacation or granted for reasons of
professional advancement, education, health, government service, or military
leave, or during any period required to be treated as a leave of absence by
virtue of any applicable statute, Company personnel policy or agreement. Whether
an authorized leave of absence shall constitute termination of Employment
hereunder shall be determined by the Committee in its discretion.

    

    Unless
otherwise provided in the Incentive Agreement, the term “Employment”
for purposes of the Plan is also defined to include (i) compensatory
or advisory services performed by a Consultant for the Company (or any
Parent or Subsidiary) and (ii) membership on the Board by an Outside
Director. Notwithstanding the foregoing, with respect to an Incentive Award that
is deferred compensation subject to Code Section 409A a termination of
Employment shall be determined by the Committee under the “separation from
service” requirements under Code Section 409A.

    

    
      
        
        

      

      
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    (q)  Exchange
Act. The
Securities Exchange Act of 1934, as amended

    

    (r) Fair
Market Value. If
the Company is not a Publicly Held Corporation at the time a determination of
the Fair Market Value of the Common Stock is required to be made hereunder, the
determination of Fair Market Value for purposes of the Plan shall be made by the
Committee in its discretion exercised in good faith, and to the extent any
Incentive Award is intended to be exempt from Code Section 409A, consistent
with Code Section 409A as it shall determine. In this respect, the
Committee may rely on such financial data, appraisals, valuations, experts, and
other sources as, in its sole and absolute discretion, it deems advisable under
the circumstances.

    

    If the
Company is a Publicly Held Corporation, the Fair Market Value of one share of
Common Stock on the date in question is deemed to be (i) the closing sales
price on the immediately preceding business day of a share of Common Stock as
reported on the New York Stock Exchange or other principal securities exchange
on which Shares are then listed or admitted to trading, or (ii) the closing
sales price for a Share on the date of grant as quoted on the National
Association of Securities Dealers Automated Quotation System (“NASDAQ”),
(iii) if not quoted on NASDAQ, the average of the closing bid and asked
prices for a Share as quoted by the National Quotation Bureau’s “Pink Sheets” or
the National Association of Securities Dealers’ OTC Bulletin Board System, or
(iv) any other method permitted by Code Section 409A as determined by
the Committee in its discretion and consistently applied. If there was no public
trade of Common Stock on the date in question, Fair Market Value shall be
determined by reference to the last preceding date on which such a trade was so
reported.

    

    (s) Grantee. Any Employee, Consultant or
Outside Director who is granted an Incentive Award under the Plan.

    

    (t) Immediate
Family. With
respect to a Grantee, the Grantee’s child, stepchild, grandchild, parent,
stepparent, grandparent, spouse, former spouse, sibling, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law,
including adoptive relationships.

    

    (u) Incentive
Award. A grant of
an award under the Plan to a Grantee, including any Nonstatutory Stock Option,
Incentive Stock Option, Reload Option, Stock Appreciation Right, Restricted
Stock Award, Performance Unit, Performance Share, or Other Stock-Based Award, as
well as any Supplemental Payment.

    

    (v)  Incentive
Agreement. The
written agreement entered into between the Company and the Grantee setting forth
the terms and conditions pursuant to which an Incentive Award is granted under
the Plan, as such agreement is further defined in Section 6.1(a).

    

    (w) Incentive
Stock Option or ISO.
A Stock Option granted by the Committee to an Employee under Section 2 which
is designated by the Committee as an Incentive Stock Option and intended to
qualify as an Incentive Stock Option under Section 422 of the
Code.

    

    
      
        
        

      

      
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    (x)  Independent
SAR. A Stock
Appreciation Right described in Section
2.5.

    

    (y)  Insider. If the Company is a Publicly
Held Corporation, an individual who is, on the relevant date, an officer,
director or ten percent (10%) beneficial owner of any class of the Company’s
equity securities that is registered pursuant to Section 12 of the Exchange
Act, all as defined under Section 16 of the Exchange Act.

    

    (z) Nonstatutory
Stock Option. A
Stock Option granted by the Committee to a Grantee under Section 2 that
is not designated by the Committee as an Incentive Stock Option.

    

    (aa) Option
Price. The
exercise price at which a Share may be purchased by the Grantee of a Stock
Option.

    

    (bb)  Other
Stock-Based Award.
An award granted by the Committee to a Grantee under Section 5.1 that
is valued in whole or in part by reference to, or is otherwise based upon,
Common Stock and payable in Common Stock, cash or other
consideration.

    

    (cc) Outside
Director. A
member of the Board who is not, at the time of grant of an Incentive Award, an
employee of the Company or any Parent or Subsidiary within the meaning of 16b-3
under the Exchange Act.

    

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

    

    (ee) Performance-Based
Exception. The
performance-based exception from the tax deductibility limitations of Section
162(m) of the Code, as prescribed in Code § 162(m) and Treasury Regulation §
1.162-27(e) (or its successor), which is applicable during such period that the
Company is a Publicly Held Corporation.

    

    (ff)  Performance
Period. A period
of time determined by the Committee over which performance is measured for the
purpose of determining a Grantee’s right to and the payment value of any
Performance Unit, Performance Share or Other Stock-Based Award.

    

    (gg) Performance
Share or Performance Unit. An Incentive Award
representing a contingent right to receive cash or shares of Common Stock (which
may be Restricted Stock) at the end of  a Performance Period and
which, in the case of Performance Shares, is denominated in Common Stock, and,
in the case of Performance Units, is denominated in cash values.

    

    (hh) Plan. VivaKor, Inc. 2008 Incentive
Plan as set forth herein and as it may be amended from time to
time.

     

    
      
        
        

      

      
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    (ii) Publicly
Held Corporation.
A corporation issuing any class of common equity securities required to
be registered under Section 12 of the Exchange Act and listed on a
nationally recognized stock exchange or automated quotation system; provided,
however, the Over The Counter Bulletin Board shall not be considered a
nationally recognized stock exchange.

    

    (jj)  Restricted
Stock. Shares of
Common Stock issued or transferred to a Grantee pursuant to Section 3.

    

    (kk) Restricted
Stock Award. An
authorization by the Committee to issue or transfer Restricted Stock to a
Grantee.

    

    (ll) Restriction
Period. The
period of time determined by the Committee and set forth in the Incentive
Agreement during which the transfer of Restricted Stock by the Grantee is
restricted.

    

    (mm)
Retirement. The voluntary termination of
Employment from the Company or any Parent or Subsidiary constituting retirement
for age on any date after the Employee attains the normal retirement age of
65 years, or such other age as may be designated by the Committee in the
Employee’s Incentive Agreement.

    

    (nn)
Share. A share of the Common Stock
of the Company.

    

    (oo)
Share
Pool. The number
of shares authorized for issuance under Section 1.4, as
adjusted for awards and payouts under Section 1.5 and
as adjusted for changes in corporate capitalization under Section 6.5.

    

    (pp)
Spread. The difference between the
exercise price per Share specified in any Independent SAR grant and the Fair
Market Value of a Share on the date of exercise of the Independent
SAR.

    

     (qq)
Stock
Appreciation Right or SAR. A Tandem SAR described in
Section 2.4 or
an Independent SAR described in Section 2.5.

    

     (rr)
Stock
Option or Option. Pursuant to Section 2,
(i) an Incentive Stock Option granted to an Employee, or (ii) a
Nonstatutory Stock Option granted to an Employee, Consultant or Outside
Director, whereunder such option the Grantee has the right to purchase Shares of
Common Stock. In accordance with Section 422 of the Code, only an Employee
may be granted an Incentive Stock Option.

    

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

    

    
      
        
        

      

      
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     (tt)
Supplemental
Payment. Any
amount, as described in Sections 2.7, 3.4
and/or 4.2, that is dedicated to payment of income taxes which are
payable by the Grantee resulting from an Incentive Award.

    

     (uu)
Tandem
SAR. A Stock
Appreciation Right that is granted in connection with a related Stock Option
pursuant to Section 2.4, the
exercise of which shall require forfeiture of the right to purchase a Share
under the related Stock Option (and when a Share is purchased under the Stock
Option, the Tandem SAR shall similarly be canceled).

    

    1.3 Plan
Administration

    

         (a)
Authority
of the Committee. Except as may be limited by law and subject to the
provisions herein, the Committee shall have full power to (i) select
Grantees who shall participate in the Plan; (ii) determine the sizes,
duration and types of Incentive Awards; (iii) determine the terms and
conditions of Incentive Awards and Incentive Agreements; (iv) determine
whether any Shares subject to Incentive Awards will be subject to any
restrictions on transfer; (v) construe and interpret the Plan and any
Incentive Agreement or other agreement entered into under the Plan; and
(vi) establish, amend, or waive rules for the Plan’s administration.
Further, the Committee shall make all other determinations which may be
necessary or advisable for the administration of the Plan including, without
limitation, correcting any defect, supplying any omission or reconciling any
inconsistency in the Plan or Incentive Agreement. The determination of the
Committee shall be final and binding on all persons.

    

         (b)
Meetings.
The Committee shall designate a chairman from among its members who shall
preside at all of its meetings, and shall designate a secretary, without regard
to whether that person is a member of the Committee, who shall keep the minutes
of the proceedings and all records, documents, and data pertaining to its
administration of the Plan. Meetings shall be held at such times and places as
shall be determined by the Committee and the Committee may hold telephonic
meetings. The Committee may take any action otherwise proper under the Plan by
the affirmative vote, taken with or without a meeting, of a majority of its
members. The Committee may authorize any one or more of their members or any
officer of the Company to execute and deliver documents on behalf of the
Committee.

    

         (c)
Decisions
Binding. All determinations and decisions made by the Committee shall be
made in its discretion pursuant to the provisions of the Plan, and shall be
final, conclusive and binding on all persons including the Company, its
shareholders, Employees, Grantees, and their estates and beneficiaries. The
Committee’s decisions and determinations with respect to any Incentive Award
need not be uniform and may be made selectively among Incentive Awards and
Grantees, whether or not such Incentive Awards are similar or such Grantees are
similarly situated.

     

    
      
        
        

      

      
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         (d)
Modification
of Outstanding Incentive Awards. Subject to the stockholder approval
requirements of Section 7.7 if
applicable, the Committee may, in its discretion, provide for the extension of
the exercisability of an Incentive Award, accelerate the vesting or
exercisability of an Incentive Award, eliminate or make less restrictive any
restrictions contained in an Incentive Award, waive any restriction or other
provisions of an Incentive Award, or otherwise amend or modify an Incentive
Award in any manner that is either (i) not adverse to the Grantee to whom
such Incentive Award was granted or (ii) consented to by such Grantee. With
respect to an Incentive Award that is an incentive stock option (as described in
Section 422 of the Code), no adjustment to such option shall be made to the
extent constituting a “modification” within the meaning of
Section 424(h)(3) of the Code unless otherwise agreed to by the optionee in
writing.

    

         (e)
Delegation
of Authority. The Committee may delegate to designated officers or other
employees of the Company any of its duties and authority under the Plan pursuant
to such conditions or limitations as the Committee may establish from time to
time; provided, however, the Committee may not delegate to any person the
authority to (i) grant Incentive Awards, or (ii), if the Company is a
Publicly Held Corporation, take any action which would contravene the
requirements of Rule 16b-3 under the Exchange Act or the Performance-Based
Exception under Section 162(m) of the Code.

    

         (f)
Expenses
of Committee. The Committee may employ legal counsel, including, without
limitation, independent legal counsel and counsel regularly employed by the
Company, and other agents as the Committee may deem appropriate for the
administration of the Plan. The Committee may rely upon any opinion or
computation received from any such counsel or agent. All expenses incurred by
the Committee in interpreting and administering the Plan, including, without
limitation, meeting expenses and professional fees, shall be paid by the
Company.

    

         (g)
Surrender
of Previous Incentive Awards. The Committee may, in its absolute
discretion, grant Incentive Awards to Grantees on the condition that such
Grantees surrender to the Committee for cancellation such other Incentive Awards
(including, without limitation, Incentive Awards with higher exercise prices) as
the Committee directs. Incentive Awards granted on the condition precedent of
surrender of outstanding Incentive Awards shall not count against the limits set
forth in Section 1.4
until such time as such previous Incentive Awards are surrendered and
cancelled.

    

         (h)
Indemnification.
Each person who is or was a member of the Committee, or of the Board, shall be
indemnified by the Company against and from any damage, loss, liability, cost
and expense that may be imposed upon or reasonably incurred by him in connection
with or resulting from any claim, action, suit, or proceeding to which he may be
a party or in which he may be involved by reason of any action taken or failure
to act under the Plan (including such indemnification for a person’s own, sole,
concurrent or joint negligence or strict liability), except for any such act or
omission constituting willful misconduct or gross negligence. Such person shall
be indemnified by the Company for all amounts paid by him in settlement thereof,
with the Company’s approval, or paid by him in satisfaction of any judgment in
any such action, suit, or proceeding against him, provided he shall give the
Company an opportunity, at its own expense, to handle and defend the same before
he undertakes to handle and defend it on his own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification to
which such persons may be entitled under the Company’s Articles of Incorporation
or Bylaws, as a matter of law, or otherwise, or any power that the Company may
have to indemnify them or hold them harmless.

    

    
      
        
        

      

      
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    1.4 Shares of Common Stock Available for
Incentive Awards

    

    Subject
to adjustment under Section 6.5,
there shall be available for Incentive Awards that are granted wholly or partly
in Common Stock (including rights or Stock Options that may be exercised for or
settled in Common Stock) a number of Shares of Common Stock which shall equal
seven million five hundred thousand (7,500,000) Shares. The Committee may from
time to time adopt and observe such procedures concerning the counting of Shares
against the Plan maximum as it may deem appropriate.

     

    During
any period that the Company is a Publicly Held Corporation, the following rules
shall apply to grants of Incentive Awards:

     

    (a)
Subject to adjustment as provided in Section 6.5, the
maximum aggregate number of Shares of Common Stock (including Stock Options,
SARs, Restricted Stock, Performance Units and Performance Shares paid out in
Shares, or Other Stock-Based Awards paid out in Shares) that may be granted in
any calendar year pursuant to any Incentive Award held by any individual
Employee shall be two million (2,000,000) Shares.

     

    (b) The
maximum aggregate cash payout (including SARs, Performance Units and Performance
Shares paid out in cash, or Other Stock-Based Awards paid out in cash) with
respect to Incentive Awards granted in any calendar year which may be made to
any individual Employee shall be one million dollars ($1,000,000).

     

    (c) With
respect to any Stock Option or Stock Appreciation Right granted to an Employee
that is canceled or repriced, the number of Shares subject to such Stock Option
or Stock Appreciation Right shall continue to count against the maximum number
of Shares that may be the subject of Stock Options or Stock Appreciation Rights
granted to such Employee to the extent required by and in accordance with
Section 162(m) of the Code.

     

    (d) The
limitations of subsections (a), (b) and (c) above shall be construed
and administered so as to comply with the Performance-Based
Exception.

    

    
      
        
        

      

      
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    1.5 Share Pool Adjustments for Awards and
Payouts

    

    The
following Incentive Awards and payouts shall reduce, on a one Share for one
Share basis, the number of Shares authorized for issuance under the Share
Pool:

     

    (a)  Stock
Option;

     

    (b) SAR
(except a Tandem SAR);

     

    (c)
Restricted Stock;

     

    (d) A
payout of a Performance Share in Shares;

     

    (e) A
payout of a Performance Unit in Shares; and

     

    (f) A
payout of an Other Stock-Based Award in Shares.

     

    The
following transactions shall restore, on a one Share for one Share basis, the
number of Shares authorized for issuance under the Share Pool:

     

    (a) A
Payout of a SAR, Tandem SAR, Restricted Stock Award, or Other Stock-Based Award
in the form of cash;

     

    (b) A
cancellation, termination, expiration, forfeiture, or lapse for any reason (with
the exception of the termination of a Tandem SAR upon exercise of the related
Stock Option, or the termination of a related Stock Option upon exercise of the
corresponding Tandem SAR) of any Shares subject to an Incentive
Award;

     

    (c)
Payment of an Option Price with previously acquired Shares; provided, however,
that the Share Pool shall not be increased by the number of Shares withheld
(which would otherwise be acquired on the exercise) as payment of the Option
Price or for tax withholding; and

     

    (d)
Payment or the withholding of Shares for taxes or the purchase price for Shares
under a Restricted Stock Award.

    

    1.6 Common Stock
Available

    

    The
Common Stock available for issuance or transfer under the Plan shall be made
available from Shares now or hereafter (a) held in the treasury of the
Company, (b) authorized but unissued shares, or (c) shares to be
purchased or acquired by the Company. No fractional shares shall be issued under
the Plan; payment for fractional shares shall be made in cash.

    

    
      
        
        

      

      
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    1.7 Participation

    

    (a)  Eligibility. The Committee shall from
time to time designate those Employees, Consultants and/or Outside Directors, if
any, to be granted Incentive Awards under the Plan, the type of Incentive Awards
granted, the number of Shares, Stock Options, rights or units, as the case may
be, which shall be granted to each such person, and any other terms or
conditions relating to the Incentive Awards as it may deem appropriate to the
extent consistent with the provisions of the Plan. A Grantee who has been
granted an Incentive Award may, if otherwise eligible, be granted additional
Incentive Awards at any time. With respect to Nonstatutory Stock Options or SARs
intended to be excluded from the requirements of Code Section 409A,
Incentive Awards of Nonstatutory Stock Options or SARs may only be made to
Grantees if the Incentive Award would be for “service recipient stock” within
the meaning of Code Section 409A, as determined by the
Committee.

     

    (b)
 Incentive
Stock Option Eligibility. No Consultant or Outside
Director shall be eligible for the grant of any Incentive Stock Option. In
addition, no Employee shall be eligible for the grant of any Incentive Stock
Option who owns or would own immediately before the grant of such Incentive
Stock Option, directly or indirectly, stock possessing more than ten percent
(10%) of the total combined voting power of all classes of stock of the Company,
or any Parent or Subsidiary. This restriction does not apply if, at the time
such Incentive Stock Option is granted, the Incentive Stock Option exercise
price is at least one hundred and ten percent (110%) of the Fair Market Value on
the date of grant and the Incentive Stock Option by its terms is not exercisable
after the expiration of five (5) years from the date of grant. For the purpose
of the immediately preceding sentence, the attribution rules of Section 424(d)
of the Code shall apply for the purpose of determining an Employee’s percentage
ownership in the Company or any Parent or Subsidiary. This paragraph shall be
construed consistent with the requirements of Section 422 of the
Code.

    

    1.8 Types of Incentive
Awards

    

    The types
of Incentive Awards under the Plan are Stock Options, Stock Appreciation Rights
and Supplemental Payments as described in Section 2,
Restricted Stock and Supplemental Payments as described in Section 3,
Performance Units, Performance Shares and Supplemental Payments as described in
Section 4,
Other Stock-Based Awards and Supplemental Payments as described in Section 5, or
any combination of the foregoing.

    

    1.9 Other Compensation
Programs

    

    The
existence and terms of the Plan shall not limit the authority of the Board or
Company or any Company affiliate in compensating directors, Outside Directors,
Employees or Consultants of the Company, in such other forms and amounts,
including compensation pursuant to any other plans or programs (including but
not limited to bonus programs) as may be currently in effect or adopted in the
future, as it may determine from time to time.

    

    
      
        
        

      

      
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    1.10
Repricing
Prohibited

    

    Except in
connection with a corporate transaction involving the Company (including,
without limitation, any stock dividend, stock split, extraordinary cash
dividend, recapitalization, reorganization, merger, consolidation, split-up,
spin-off, combination, or exchange of shares), the terms of outstanding
Incentive Awards may not be amended to reduce the exercise price of outstanding
Options or SARs or cancel outstanding Options or SARS in exchange for cash,
other Incentive Awards or Options or SARs with an exercise price that is less
than the exercise price of the original Options or SARs without stockholder
approval.

    
SECTION 2

    

    STOCK OPTIONS AND STOCK APPRECIATION
RIGHTS

    

    2.1 Grant of Stock
Options

    

    The
Committee is authorized to grant (a) Nonstatutory Stock Options to
Employees, Consultants and/or Outside Directors and (b) Incentive Stock
Options to Employees only, in accordance with the terms and conditions of the
Plan, and with such additional terms and conditions, not inconsistent with the
Plan, as the Committee shall determine in its discretion. Successive grants may
be made to the same Grantee whether or not any Stock Option previously granted
to such person remains unexercised.

    

    2.2 Stock Option
Terms

    

    (a)  Written
Agreement. Each
grant of a Stock Option shall be evidenced by a written Incentive Agreement.
Among its other provisions, each Incentive Agreement shall set forth the extent
to which the Grantee shall have the right to exercise the Stock Option following
termination of the Grantee’s Employment. Such provisions shall be determined in
the discretion of the Committee, shall be included in the Grantee’s Incentive
Agreement, need not be uniform among all Stock Options issued pursuant to the
Plan.

     

    (b)  Number of
Shares. Each
Stock Option shall specify the number of Shares of Common Stock to which it
pertains.

     

    (c)  Exercise
Price. The
exercise price per Share of Common Stock under each Stock Option shall be
determined by the Committee; provided, however, that such exercise price shall
not be less than 100% of the Fair Market Value per Share on the date the Stock
Option is granted (110% in the case of an Incentive Stock Option for 10% or
greater shareholders pursuant to Section 1.7(b)).
Each Stock Option shall specify the method of exercise which shall be consistent
with the requirements of Section
2.3(a).

    

    
      
        
        

      

      
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    (d)  Term. In the Incentive Agreement,
the Committee shall fix the term of each Stock Option (which shall be not more
than ten (10) years from the date of grant for ISO or SAR grants; five
(5) years for ISO grants to 10% or greater shareholders pursuant to Section 1.7(b)).
In the event no term is fixed, such term shall be ten (10) years from the
date of grant.

     

    (e)  Exercise. The Committee shall
determine the time or times at which a Stock Option may be exercised in whole or
in part. Each Stock Option may specify the required period of continuous
Employment and/or the performance objectives to be achieved before the Stock
Option or portion thereof will become exercisable. Each Stock Option, the
exercise of which, or the timing of the exercise of which, is dependent, in
whole or in part, on the achievement of designated performance objectives, may
specify a minimum level of achievement in respect of the specified performance
objectives below which no Stock Options will be exercisable and a method for
determining the number of Stock Options that will be exercisable if performance
is at or above such minimum but short of full achievement of the performance
objectives. All such terms and conditions shall be set forth in the Incentive
Agreement.

     

    (f)  $100,000
Annual Limit on Incentive Stock Options. Notwithstanding any contrary
provision in the Plan, to the extent that the aggregate Fair Market Value
(determined as of the time the Incentive Stock Option is granted) of the Shares
of Common Stock with respect to which Incentive Stock Options are exercisable
for the first time by any Grantee during any single calendar year (under the
Plan and any other stock option plans of the Company and its Subsidiaries or
Parent) exceeds the sum of $100,000, such Incentive Stock Option shall be
treated as a Nonstatutory Stock Option to the extent in excess of the $100,000
limit, and not an Incentive Stock Option, but all other terms and provisions of
such Stock Option shall remain unchanged. This paragraph shall be applied by
taking Incentive Stock Options into account in the order in which they were
granted and shall be construed in accordance with Section 422(d) of the Code. In
the absence of such regulations or other authority, or if such regulations or
other authority require or permit a designation of the Options which shall cease
to constitute Incentive Stock Options, then such Incentive Stock Options, only
to the extent of such excess, shall automatically be deemed to be Nonstatutory
Stock Options but all other terms and conditions of such Incentive Stock
Options, and the corresponding Incentive Agreement, shall remain
unchanged.

    

    2.3 Stock Option
Exercises

    

    (a)  Method of
Exercise and Payment.
Stock Options shall be exercised by the delivery of a signed written
notice of exercise to the Company as of a date set by the Company in advance of
the effective date of the proposed exercise. The notice shall set forth the
number of Shares with respect to which the Option is to be exercised,
accompanied by full payment for the Shares.

     

    
      
        
        

      

      
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    The
Option Price upon exercise of any Stock Option shall be payable to the Company
in full either: (i) in cash or its equivalent, or (ii) subject to
prior approval by the Committee in its discretion, by tendering previously
acquired Shares having an aggregate Fair Market Value at the time of exercise
equal to the Option Price (provided that the Shares which are tendered must have
been held by the Grantee for at least six (6) months prior to their tender
to satisfy the Option Price), or (iii) subject to prior approval by the
Committee in its discretion, by withholding Shares which otherwise would be
acquired on exercise having an aggregate Fair Market Value at the time of
exercise equal to the total Option Price, or (iv) subject to prior approval
by the Committee in its discretion, by a combination of (i), (ii), and
(iii) above. Any payment in Shares shall be effected by the surrender of
such Shares to the Company in good form for transfer and shall be valued at
their Fair Market Value on the date when the Stock Option is exercised. Unless
otherwise permitted by the Committee in its discretion, the Grantee shall not
surrender, or attest to the ownership of, Shares in payment of the Option Price
if such action would cause the Company to recognize compensation expense (or
additional compensation expense) with respect to the Stock Option for financial
reporting purposes. In no event will the Committee allow the Option Price to be
paid with a form of consideration, including, but not limited to, a loan to an
Employee, if such form of consideration would violate the Sarbanes-Oxley Act of
2002 as determined by the Committee in its discretion.

     

    The
Committee, in its discretion, also may allow the Option Price to be paid with
such other consideration as shall constitute lawful consideration for the
issuance of Shares (including, without limitation, effecting a “cashless
exercise” with a broker of the Option), subject to applicable securities law
restrictions and tax withholdings, or by any other means which the Committee
determines to be consistent with the Plan’s purpose and applicable law. A
“cashless exercise” of an Option is a procedure by which a broker provides the
funds to the Grantee to effect an Option exercise, to the extent consented to by
the Committee in its discretion. At the direction of the Grantee, the broker
will either (i) sell all of the Shares received when the Option is
exercised and pay the Grantee the proceeds of the sale (minus the Option Price,
withholding taxes and any fees due to the broker) or (ii) sell enough of
the Shares received upon exercise of the Option to cover the Option Price,
withholding taxes and any fees due the broker and deliver to the Grantee (either
directly or through the Company) a stock certificate for the remaining Shares.
Dispositions to a broker effecting a cashless exercise are not exempt under
Section 16 of the Exchange Act (if the Company is a Publicly Held
Corporation).

     

    The
Committee, in its discretion, may also allow an Option to be exercised by a
broker-dealer acting on behalf of the Grantee if (i) the broker-dealer has
received from the Grantee a duly endorsed Incentive Agreement evidencing such
Option and instructions signed by the Grantee requesting the Company to deliver
the shares of Common Stock subject to such Option to the broker-dealer on behalf
of the Grantee and specifying the account into which such shares should be
deposited, (ii) adequate provision has been made with respect to the
payment of any withholding taxes due upon such exercise, and (iii) the
broker-dealer and the Grantee have otherwise complied with
Section 220.3(e)(4) of Regulation T, 12 CFR Part 220
(or its successor).

     

    
      
        
        

      

      
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    As soon
as practicable after receipt of a written notification of exercise and full
payment, the Company shall deliver, or cause to be delivered, to or on behalf of
the Grantee, in the name of the Grantee or other appropriate recipient, Share
certificates for the number of Shares purchased under the Stock Option. Such
delivery shall be effected for all purposes when the Company or a stock transfer
agent of the Company shall have deposited such certificates in the United States
mail, addressed to Grantee or other appropriate recipient.

     

    Subject
to Section 6.2,
during the lifetime of a Grantee, each Option granted to him shall be
exercisable only by the Grantee (or his legal guardian in the event of his
Disability) or by a broker-dealer acting on his behalf pursuant to a cashless
exercise under the foregoing provisions of this Section 2.3(a).

     

    (b) Restrictions
on Share Transferability. The Committee may impose
such restrictions on any grant of Stock Options or on any Shares acquired
pursuant to the exercise of a Stock Option as it may deem advisable, including,
without limitation, restrictions under (i) any stockholders’ agreement,
buy/sell agreement, stockholders’ agreement, right of first refusal,
non-competition, and any other agreement between the Company and any of its
securities holders or employees, (ii) any applicable federal securities
laws, (iii) the requirements of any stock exchange or market upon which
such Shares are then listed and/or traded, or (iv) any blue sky or state
securities law applicable to such Shares. Any certificate issued to evidence
Shares issued upon the exercise of an Incentive Award may bear such legends and
statements as the Committee shall deem advisable to assure compliance with
federal and state laws and regulations.

     

    Any
Grantee or other person exercising an Incentive Award may be required by the
Committee to give a written representation that the Incentive Award and the
Shares subject to the Incentive Award will be acquired for investment and not
with a view to public distribution; provided, however, that the Committee, in
its sole discretion, may release any person receiving an Incentive Award from
any such representations either prior to or subsequent to the exercise of the
Incentive Award.

     

    (c) Notification
of Disqualifying Disposition of Shares from Incentive Stock Options.
Notwithstanding any other provision of the Plan, a Grantee who disposes of
Shares of Common Stock acquired upon the exercise of an Incentive Stock Option
by a sale or exchange either (i) within two (2) years after the date
of the grant of the Incentive Stock Option under which the Shares were acquired
or (ii) within one (1) year after the transfer of such Shares to him
pursuant to exercise, shall promptly notify the Company of such disposition, the
amount realized and his adjusted basis in such Shares.

     

    (d) Proceeds
of Option Exercise.
The proceeds received by the Company from the sale of Shares pursuant to
Stock Options exercised under the Plan shall be used for general corporate
purposes.

    

    
      
        
        

      

      
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    2.4 Stock Appreciation Rights in Tandem
with Nonstatutory Stock Options

    

    (a) Grant. The Committee may, at the
time of grant of a Nonstatutory Stock Option, or at any time thereafter during
the term of the Nonstatutory Stock Option, grant Stock Appreciation Rights with
respect to all or any portion of the Shares of Common Stock covered by such
Nonstatutory Stock Option. A Stock Appreciation Right in tandem with a
Nonstatutory Stock Option is referred to herein as a “Tandem
SAR.”

     

    (b) General
Provisions. The
terms and conditions of each Tandem SAR shall be evidenced by an Incentive
Agreement. The Option Price per Share of a Tandem SAR shall be fixed in the
Incentive Agreement and shall not be less than one hundred percent (100%) of the
Fair Market Value of a Share on the grant date of the Nonstatutory Stock Option
to which it relates.

     

    (c) Exercise. A Tandem SAR may be
exercised at any time the Nonstatutory Stock Option to which it relates is then
exercisable, but only to the extent such Nonstatutory Stock Option is
exercisable, and shall otherwise be subject to the conditions applicable to such
Nonstatutory Stock Option. When a Tandem SAR is exercised, the Nonstatutory
Stock Option to which it relates shall terminate to the extent of the number of
Shares with respect to which the Tandem SAR is exercised. Similarly, when a
Nonstatutory Stock Option is exercised, the Tandem SARs relating to the Shares
covered by such Nonstatutory Stock Option exercise shall terminate. Any Tandem
SAR which is outstanding on the last day of the term of the related Nonstatutory
Stock Option shall be automatically exercised on such date for cash, without the
need for any action by the Grantee, to the extent of any
Appreciation.

     

    (d) Settlement. Upon exercise of a Tandem
SAR, the holder shall receive, for each Share with respect to which the Tandem
SAR is exercised, an amount equal to the Appreciation. The Appreciation shall be
payable in cash, Common Stock, or a combination of both, as specified in the
Incentive Agreement (or in the discretion of the Committee if not so specified).
The Appreciation shall be paid within 30 calendar days of the exercise of the
Tandem SAR. The number of Shares of Common Stock which shall be issuable upon
exercise of a Tandem SAR shall be determined by dividing (1) by (2), where
(1) is the number of Shares as to which the Tandem SAR is exercised
multiplied by the Appreciation in such shares and (2) is the Fair Market
Value of a Share on the exercise date.

    

    2.5 Stock Appreciation Rights Independent
of Nonstatutory Stock Options

    

    (a) Grant. The Committee may grant
Stock Appreciation Rights independent of Nonstatutory Stock Options (“Independent
SARs”).

     

    (b) General
Provisions. The
terms and conditions of each Independent SAR shall be evidenced by an Incentive
Agreement. The exercise price per share of Common Stock shall be not less than
one hundred percent (100%) of the Fair Market Value of a Share of Common Stock
on the date of grant of the Independent SAR. The term of an Independent SAR
shall be determined by the Committee.

     

    
      
        
        

      

      
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    (c) Exercise. Independent SARs shall be
exercisable at such time and subject to such terms and conditions as the
Committee shall specify in the Incentive Agreement for the Independent SAR
grant.

     

    (d) Settlement. Upon exercise of an
Independent SAR, the holder shall receive, for each Share specified in the
Independent SAR grant, an amount equal to the Spread. The Spread shall be
payable in cash, Common Stock, or a combination of both, in the discretion of
the Committee or as specified in the Incentive Agreement. The Spread shall be
paid within 30 calendar days of the exercise of the Independent SAR. The number
of Shares of Common Stock which shall be issuable upon exercise of an
Independent SAR shall be determined by dividing (1) by (2), where
(1) is the number of Shares as to which the Independent SAR is exercised
multiplied by the Spread in such Shares and (2) is the Fair Market Value of
a Share on the exercise date.

    

    2.6 Reload Options

    

    At the
discretion of the Committee, the Grantee may be granted under an Incentive
Agreement, replacement Stock Options under the Plan that permit the Grantee to
purchase an additional number of Shares equal to the number of previously owned
Shares surrendered by the Grantee to pay for all or a portion of the Option
Price upon exercise of his Stock Options. The terms and conditions of such
replacement Stock Options shall be set forth in the Incentive
Agreement.

    

    2.7 Supplemental Payment on Exercise of
Nonstatutory Stock Options or Stock Appreciation Rights

    

    The
Committee, either at the time of grant or as of the time of exercise of any
Nonstatutory Stock Option or Stock Appreciation Right, may provide in the
Incentive Agreement for a Supplemental Payment by the Company to the Grantee
with respect to the exercise of any Nonstatutory Stock Option or Stock
Appreciation Right. The Supplemental Payment shall be in the amount specified by
the Committee, which amount shall not exceed the amount necessary to pay the
federal and state income tax payable with respect to both the exercise of the
Nonstatutory Stock Option and/or Stock Appreciation Right and the receipt of the
Supplemental Payment, assuming the holder is taxed at either the maximum
effective income tax rate applicable thereto or at a lower tax rate as deemed
appropriate by the Committee. The Committee shall have the discretion to grant
Supplemental Payments that are payable solely in cash or Supplemental Payments
that are payable in cash, Common Stock, or a combination of both, as determined
by the Committee at the time of payment.

    

    

    
      
        
        

      

      
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    SECTION 3

    

    RESTRICTED
STOCK

    

    3.1 Award of Restricted
Stock

    

    (a)  Grant. In consideration of the
performance of Employment by any Grantee who is an Employee, Consultant or
Outside Director, Shares of Restricted Stock may be awarded under the Plan by
the Committee with such restrictions during the Restriction Period as the
Committee may designate in its discretion, any of which restrictions may differ
with respect to each particular Grantee. Restricted Stock shall be awarded for
no additional consideration or such additional consideration as the Committee
may determine, which consideration may be less than, equal to or more than the
Fair Market Value of the shares of Restricted Stock on the grant date. The terms
and conditions of each grant of Restricted Stock shall be evidenced by an
Incentive Agreement.

     

    (b)  Immediate
Transfer Without Immediate Delivery of Restricted Stock. Unless otherwise
specified in the Grantee’s Incentive Agreement, each Restricted Stock Award
shall constitute an immediate transfer of the record and beneficial ownership of
the Shares of Restricted Stock to the Grantee in consideration of the
performance of services as an Employee, Consultant or Outside Director, as
applicable, entitling such Grantee to all voting and other ownership rights in
such Shares.

     

    As
specified in the Incentive Agreement, a Restricted Stock Award may limit the
Grantee’s dividend rights during the Restriction Period in which the shares of
Restricted Stock are subject to a “substantial risk of forfeiture” (within the
meaning given to such term under Code Section 83) and restrictions on
transfer. In the Incentive Agreement, the Committee may apply any restrictions
to the dividends that the Committee deems appropriate. Without limiting the
generality of the preceding sentence, if the grant or vesting of Shares of
Restricted Stock granted to a Covered Employee, if applicable, is designed to
comply with the requirements of the Performance-Based Exception, the Committee
may apply any restrictions it deems appropriate to the payment of dividends
declared with respect to such Shares of Restricted Stock, such that the
dividends and/or the Shares of Restricted Stock maintain eligibility for the
Performance-Based Exception. In the event that any dividend constitutes a
derivative security or an equity security pursuant to the rules under Section 16
of the Exchange Act, if applicable, such dividend shall be subject to a vesting
period equal to the remaining vesting period of the Shares of Restricted Stock
with respect to which the dividend is paid.

     

    Shares
awarded pursuant to a grant of Restricted Stock may be evidenced in a manner as
the Committee shall deem appropriate, including without limitation book entry,
Shares issued in the name of the Grantee and held, together with a stock power
endorsed in blank, by the Committee or Company (or their delegates), or in trust
or in escrow pursuant to an agreement satisfactory to the Committee, as
determined by the Committee, until such time as the restrictions on transfer
have expired or the Committee may provide for the transfer of the Shares of the
Restricted Stock to a transfer agent on behalf of the Grantee pursuant to terms
as determined by the Committee to maintain the restricted status of the Shares
until vested. If the Company issues a stock certificate, registered in the name
of the Grantee to whom such Shares of Restricted Stock were granted, evidencing
such Shares, the Company shall not cause to be issued such a stock certificate
unless it has received a stock power duly endorsed in blank with respect to such
Shares. Each such stock certificate shall bear the following legend or any other
legend approved by the Company:

     

    
      
        
        

      

      
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    THE
TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY
ARE SUBJECT TO THE RESTRICTIONS, TERMS AND CONDITIONS (INCLUDING FORFEITURE AND
RESTRICTIONS AGAINST TRANSFER) CONTAINED IN THE VIVAKOR, INC. 2008 INCENTIVE
PLAN AND AN INCENTIVE STOCK OPTION AGREEMENT ENTERED INTO BETWEEN THE REGISTERED
OWNER OF SUCH SHARES AND VIVAKOR, INC. A COPY OF THE PLAN AND INCENTIVE STOCK
OPTION AGREEMENT ARE ON FILE IN THE CORPORATE OFFICES OF VIVAKOR,
INC.

     

    Such
legend shall not be removed from the certificate evidencing such Shares of
Restricted Stock until such Shares vest pursuant to the terms of the Incentive
Agreement.

     

    3.2 Restrictions

    

    (a)  Forfeiture
of Restricted Stock.
Restricted Stock awarded to a Grantee may be subject to the following
restrictions until the expiration of the Restriction Period: (i) a restriction
that constitutes a “substantial risk of forfeiture” (as defined in Code
Section 83), or a restriction on transferability; (ii) unless
otherwise specified by the Committee in the Incentive Agreement, the Restricted
Stock that is subject to restrictions which are not satisfied shall be forfeited
and all rights of the Grantee to such Shares shall terminate; and (iii) any
other restrictions that the Committee determines in advance are appropriate,
including, without limitation, rights of repurchase or first refusal in the
Company or provisions subjecting the Restricted Stock to a continuing
substantial risk of forfeiture in the hands of any transferee. Any such
restrictions shall be set forth in the particular Grantee’s Incentive
Agreement.

     

    (b)  Removal
of Restrictions.
The Committee, in its discretion, shall have the authority to remove any
or all of the restrictions on the Restricted Stock if it determines that, by
reason of a change in applicable law or another change in circumstance arising
after the grant date of the Restricted Stock, such action is
appropriate.

    

    3.3 Lapse of
Restrictions

    

    Upon the
lapse of the forfeiture restrictions as set forth in the Incentive Agreement,
the unrestricted Shares shall be evidenced in such manner as determined by the
Committee and shall be issued to the Grantee promptly after the restrictions
have lapsed in a manner as determined by the Committee in its sole
discretion.

    

    
      
        
        

      

      
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    3.4 Supplemental Payment on Vesting of
Restricted Stock

    

    The
Committee, either at the time of grant or vesting of Restricted Stock, may
provide for a Supplemental Payment by the Company to the holder in an amount
specified by the Committee, which amount shall not exceed the amount necessary
to pay the federal and state income tax payable with respect to both the vesting
of the Restricted Stock and receipt of the Supplemental Payment, assuming the
Grantee is taxed at either the maximum effective income tax rate applicable
thereto or at a lower tax rate as deemed appropriate by the Committee. The
Committee shall have the discretion to grant Supplemental Payments that are
payable solely in cash or Supplemental Payments that are payable in cash, Common
Stock, or a combination of both, as determined by the Committee at the time of
payment.

     

    SECTION 4

    

    PERFORMANCE
UNITS AND PERFORMANCE SHARES

    

    4.1 Performance Based
Awards

    

    (a)  Grant. The Committee is authorized
to grant Performance Units and Performance Shares to selected Grantees who are
Employees, Outside Directors or Consultants. Each grant of Performance Units
and/or Performance Shares shall be evidenced by an Incentive Agreement in such
amounts and upon such terms as shall be determined by the Committee. The
Committee may make grants of Performance Units or Performance Shares in such a
manner that more than one Performance Period is in progress concurrently. For
each Performance Period, the Committee shall establish the number of Performance
Units or Performance Shares and their contingent values which may vary depending
on the degree to which performance criteria established by the Committee are
met.

     

    (b) Performance
Criteria. The
Committee may establish performance goals applicable to Performance Shares or
Performance Units based upon criteria in one or more of the following
categories: (i) performance of the Company as a whole,
(ii) performance of a segment of the Company’s business, and
(iii) individual performance. Performance criteria for the Company shall
relate to the achievement of predetermined financial objectives for the Company
and its Subsidiaries on a consolidated basis. Performance criteria for a segment
of the Company’s business shall relate to the achievement of financial and
operating objectives of the segment for which the Grantee is
accountable.

     

     

    
      
        
        

      

      
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      Examples
of performance criteria shall include one or more of the following pre-tax or
after-tax profit levels, including: earnings per share, earnings before interest
and taxes, earnings before interest, taxes, depreciation and amortization, net
operating profits after tax, and net income; total stockholder return; return on
assets, equity, capital or investment; cash flow and cash flow return on
investment; economic value added and economic profit; growth in earnings per
share; levels of operating expense, maintenance expenses or measures of customer
satisfaction and customer service as determined from time to time including the
relative improvement therein; stock price performance, sales, costs, production
volumes, or reserves added. Individual performance criteria shall relate to a
Grantee’s overall performance, taking into account, among other measures of
performance, the attainment of individual goals and objectives. The performance
criteria may differ among Grantees. The performance criteria need not be based
on an increase or positive result and may include for example, maintaining the
status quo or limiting economic loss.

       

      At the
beginning of each Performance Period, the Committee shall (i) establish for
such Performance Period specific financial or non-financial performance
objectives that the Committee believes are relevant to the Company’s business
objectives; (ii) determine the value of a Performance Unit or the number of
Shares under a Performance Share grant relative to performance objectives; and
(iii) notify each Grantee in writing of the established performance
objectives and, if applicable, the minimum, target, and maximum value of
Performance Units or Performance Shares for such Performance
Period.

       

      (c) Modification. If an Incentive Award is
intended to meet the Performance Based Exception, the performance criteria shall
preclude discretion to increase the amount of compensation payable upon
attainment of the goal or other modification of the criteria except as permitted
under Code Section 162(m).

       

      (d) Payment. The basis for payment of
Performance Units or Performance Shares for a given Performance Period shall be
the achievement of those performance objectives determined by the Committee at
the beginning of the Performance Period as specified in the Grantee’s Incentive
Agreement. If minimum performance is not achieved for a Performance Period, no
payment shall be made and all contingent rights shall cease. If minimum
performance is achieved or exceeded, the value of a Performance Unit or
Performance Share may be based on the degree to which actual performance
exceeded the preestablished minimum performance standards. The amount of payment
shall be determined by multiplying the number of Performance Units or
Performance Shares granted at the beginning of the Performance Period times the
final Performance Unit or Performance Share value. Payments shall be made, in
the discretion of the Committee as specified in the Incentive Agreement, solely
in cash or Common Stock, or a combination of cash and Common Stock, following
the close of the applicable Performance Period.

       

      
        
          
          

        

        
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      (e) Special
Rule for Covered Employees. No later than the ninetieth
(90th) day following the beginning of a Performance Period (or twenty-five
percent (25%) of the Performance Period) the Committee shall establish
performance criteria as described in Section 4.1
applicable to Performance Shares or Performance Units awarded to Employees in
such a manner as shall permit payments with respect thereto to qualify for the
Performance-Based Exception, if applicable. If a Performance Unit or Performance
Share granted to an Employee is intended to comply with the Performance-Based
Exception, the Committee in establishing performance goals shall comply with
Treasury Regulation § l.162-27(e)(2) (or its successor). As soon as practicable
following the Company’s determination of the Company’s financial results for any
Performance Period, the Committee shall certify in writing: (i) whether the
Company achieved its minimum performance for the objectives for the Performance
Period, (ii) the extent to which the Company achieved its performance
objectives for the Performance Period, (iii) any other terms that are
material to the grant of Performance Awards, and (iv) the calculation of the
payments, if any, to be paid to each Grantee for the Performance
Period.

      

      4.2 Supplemental Payment on Vesting of
Performance Units or Performance Shares

      

      The
Committee, either at the time of grant or at the time of vesting of Performance
Units or Performance Shares, may provide for a Supplemental Payment by the
Company to the Grantee in an amount specified by the Committee, which amount
shall not exceed the amount necessary to pay the federal and state income tax
payable with respect to both the vesting of such Performance Units or
Performance Shares and receipt of the Supplemental Payment, assuming the Grantee
is taxed at either the maximum effective income tax rate applicable thereto or
at a lower tax rate as seemed appropriate by the Committee. The Committee shall
have the discretion to grant Supplemental Payments that are payable in cash,
Common Stock, or a combination of both, as determined by the Committee at the
time of payment.

      

      SECTION 5

      

      OTHER
STOCK-BASED AWARDS

      

      5.1 Grant of Other Stock-Based
Awards

       

      Other
Stock-Based Awards may be awarded by the Committee to selected Grantees that are
denominated or payable in, valued in whole or in part by reference to, or
otherwise related to, Shares of Common Stock, as deemed by the Committee to be
consistent with the purposes of the Plan and the goals of the Company. Other
types of Stock-Based Awards include, without limitation, Deferred Stock,
purchase rights, Shares of Common Stock awarded which are not subject to any
restrictions or conditions, convertible or exchangeable debentures, other rights
convertible into Shares, Incentive Awards valued by reference to the value of
securities of or the performance of a specified Subsidiary, division or
department, and settlement in cancellation of rights of any person with a vested
interest in any other plan, fund, program or arrangement that is or was
sponsored, maintained or participated in by the Company or any Parent or
Subsidiary. As is the case with other Incentive Awards, Other Stock-Based Awards
may be awarded either alone or in addition to or in tandem with any other
Incentive Awards.

       

      
        
          
          

        

        
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      5.2 Other Stock-Based Award
Terms

       

      (a) Written
Agreement. The
terms and conditions of each grant of an Other Stock-Based Award shall be
evidenced by an Incentive Agreement.

       

      (b) Purchase
Price. Except to
the extent that an Other Stock-Based Award is granted in substitution for an
outstanding Incentive Award or is delivered upon exercise of a Stock Option, the
amount of consideration required to be received by the Company shall be either
(i) no consideration other than services actually rendered (in the case of
authorized and unissued shares) or to be rendered, or (ii) in the case of
an Other Stock-Based Award in the nature of a purchase right, consideration
(other than services rendered or to be rendered) at least equal to 50% of the
Fair Market Value of the Shares covered by such grant on the date of grant (or
such percentage higher than 50% that is required by any applicable tax or
securities law). To the extent that the Company is a Publicly Held Corporation
and that a stock appreciation right is intended to qualify for the
Performance-Based Exception or to the extent it is intended to be exempt from
Code Section 409A, the exercise price per share of Common Stock shall not
be less than one hundred percent (100%) of Fair Market Value of a share of
Common Stock on the date of the grant of the stock appreciation
right.

       

      (c) Performance
Criteria and Other Terms. In its discretion, the
Committee may specify such criteria, periods or goals for vesting in Other
Stock-Based Awards and payment thereof to the Grantee as it shall determine; and
the extent to which such criteria, periods or goals have been met shall be
determined by the Committee. All terms and conditions of Other Stock-Based
Awards shall be determined by the Committee and set forth in the Incentive
Agreement.  The Committee may also provide for a Supplemental Payment
similar to such payment as described in Section 4.2.

       

      (d) Payment. Other Stock-Based Awards may
be paid in Shares of Common Stock or other consideration related to such Shares,
in a single payment or in installments on such dates as determined by the
Committee, all as specified in the Incentive Agreement.

       

      (e) Dividends. The Grantee of an Other
Stock-Based Award may be entitled to receive, currently or on a deferred basis,
dividends or dividend equivalents with respect to the number of Shares covered
by the Other Stock-Based Award, only if so determined by the Committee and set
forth in a separate Incentive Agreement. The Committee may also provide in such
Incentive Agreement that such amounts (if any) shall be deemed to have been
reinvested in additional Shares of Common Stock.

      

      
        
          
          

        

        
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      SECTION 6

      

      PROVISIONS RELATING TO PLAN
PARTICIPATION

      

      

      6.1 Plan Conditions

      

      (a)  Incentive
Agreement. Each
Grantee to whom an Incentive Award is granted shall be required to enter into an
Incentive Agreement with the Company, in such a form as is provided by the
Committee. The Incentive Agreement shall contain specific terms as determined by
the Committee, in its discretion, with respect to the Grantee’s particular
Incentive Award. Such terms need not be uniform among all Grantees or any
similarly-situated Grantees. The Incentive Agreement may include, without
limitation, vesting, forfeiture and other provisions particular to the
particular Grantee’s Incentive Award, as well as, for example, provisions to the
effect that the Grantee (i) shall not disclose any confidential information
acquired during Employment with the Company, (ii) shall abide by all the terms
and conditions of the Plan and such other terms and conditions as may be imposed
by the Committee, (iii) shall not interfere with the employment or other
service of any employee, (iv) shall not compete with the Company or become
involved in a conflict of interest with the interests of the Company,
(v) shall forfeit an Incentive Award if terminated for Cause,
(vi) shall not be permitted to make an election under Section 83(b) of the
Code when applicable, and (vii) shall be subject to any other agreement
between the Grantee and the Company regarding Shares that may be acquired under
an Incentive Award including, without limitation, a stockholders’ agreement,
buy-sell agreement, or other agreement restricting the transferability of Shares
by Grantee. An Incentive Agreement shall include such terms and conditions as
are determined by the Committee, in its discretion, to be appropriate with
respect to any individual Grantee. The Incentive Agreement shall be signed by
the Grantee to whom the Incentive Award is made and by an Authorized
Officer.

       

      (b)  No Right
to Employment.
Nothing in the Plan or any instrument executed pursuant to the Plan shall
create any Employment rights (including without limitation, rights to continued
Employment) in any Grantee or affect the right of the Company to terminate the
Employment of any Grantee at any time without regard to the existence of the
Plan.

       

      (c)  Securities
Requirements. The
Company shall be under no obligation to effect the registration pursuant to the
Securities Act of 1933 of any Shares of Common Stock to be issued hereunder or
to effect similar compliance under any state laws. Notwithstanding anything
herein to the contrary, the Company shall not be obligated to cause to be issued
or delivered any certificates evidencing Shares pursuant to the Plan unless and
until the Company is advised by its counsel that the issuance and delivery of
such certificates is in compliance with all applicable laws, regulations of
governmental authorities, and the requirements of any securities exchange on
which Shares are traded. The Committee may require, as a condition of the
issuance and delivery of certificates evidencing Shares of Common Stock pursuant
to the terms hereof, that the recipient of such Shares make such covenants,
agreements and representations, and that such certificates bear such legends, as
the Committee, in its discretion, deems necessary or desirable.

       

      
        
          
          

        

        
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      If the
Shares issuable on exercise of an Incentive Award are not registered under the
Securities Act of 1933, the Company may imprint on the certificate for such
Shares the following legend or any other legend which counsel for the Company
considers necessary or advisable to comply with the Securities Act of
1933:

      

      THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (“ACT”), OR THE SECURITIES LAWS OF ANY STATE.
THE SECURITIES MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO ANY APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH
ACT AND SUCH LAWS OR PURSUANT TO A WRITTEN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

      

      6.2 Transferability

      

      Incentive
Awards granted under the Plan shall not be transferable or assignable other
than: (a) by will or the laws of descent and distribution or
(b) pursuant to a qualified domestic relations order (as defined by Section
414(p) of the Code, “QDRO”; provided, however, that Incentive Stock Options may
be transferred pursuant to QDRO only if the Incentive Agreement expressly
permits such transfer and provided further, however, only with respect to
Incentive Awards consisting of Nonstatutory Stock Options, the Committee may, in
its discretion, authorize all or a portion of the Nonstatutory Stock Options to
be granted on terms which permit transfer by the Grantee to (i) the members
of the Grantee’s Immediate Family, (ii) a trust or trusts for the exclusive
benefit of Immediate Family members, (iii) a partnership in which such
Immediate Family members are the only partners, or (iv) any other entity
owned solely by Immediate Family members; provided that (A) there may be no
consideration for any such transfer, (B) the Incentive Agreement pursuant
to which such Nonstatutory Stock Options are granted must be approved by the
Committee, and must expressly provide for transferability in a manner consistent
with this Section
6.2, and (C) subsequent transfers of transferred Nonstatutory Stock
Options shall be prohibited except in accordance with clauses (a) and (b)
(above) of this sentence. Following any permitted transfer, the
Nonstatutory Stock Option shall continue to be subject to the same terms and
conditions as were applicable immediately prior to transfer, provided that the
term “Grantee” shall be deemed to refer to the transferee. The events of
termination of employment, as set out in Section 6.6 and
in the Incentive Agreement, shall continue to be applied with respect to the
original Grantee, and the Incentive Award shall be exercisable by the transferee
only to the extent, and for the periods, specified in the Incentive
Agreement.

       

      
        
          
          

        

        
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      Except as
may otherwise be permitted under the Code, in the event of a permitted transfer
of a Nonstatutory Stock Option hereunder, the original Grantee shall remain
subject to withholding taxes upon exercise. In addition, the Company and the
Committee shall have no obligation to provide any notices to any Grantee or
transferee thereof, including, for example, notice of the expiration of an
Incentive Award following the original Grantee’s termination of
employment.

       

      The
designation by a Grantee of a beneficiary of an Incentive Award shall not
constitute transfer of the Incentive Award. No transfer by will or by the laws
of descent and distribution shall be effective to bind the Company unless the
Committee has been furnished with a copy of the deceased Grantee’s enforceable
will or such other evidence as the Committee deems necessary to establish the
validity of the transfer. Any attempted transfer in violation of this Section 6.2 shall be
void and ineffective. All determinations under this Section 6.2
shall be made by the Committee in its discretion.

      

      6.3 Rights as a
Stockholder

      

      (a) No
Stockholder Rights.
Except as otherwise provided in Section 3.1(b) for
grants of Restricted Stock, a Grantee of an Incentive Award (or a permitted
transferee of such Grantee) shall have no rights as a stockholder with respect
to any Shares of Common Stock until the issuance of a stock certificate for such
Shares.

       

      (b) Representation
of Ownership. In
the case of the exercise of an Incentive Award by a person or estate acquiring
the right to exercise such Incentive Award by reason of the death or Disability
of a Grantee, the Committee may require reasonable evidence as to the ownership
of such Incentive Award or the authority of such person and may require such
consents and releases of taxing authorities as the Committee may deem
advisable.

      

      6.4 Listing and Registration of Shares of
Common Stock

      

      The
exercise of any Incentive Award granted hereunder shall only be effective at
such time as counsel to the Company shall have determined that the issuance and
delivery of Shares of Common Stock pursuant to such exercise is in compliance
with all applicable laws, regulations of governmental authorities and the
requirements of any securities exchange on which Shares of Common Stock are
traded. The Committee may, in its discretion, defer the effectiveness of any
exercise of an Incentive Award in order to allow the issuance of Shares of
Common Stock to be made pursuant to registration statement or an exemption from
registration or other methods for compliance available under federal or state
securities laws. The Committee shall inform the Grantee in writing of its
decision to defer the effectiveness of the exercise of an Incentive Award.
During the period that the effectiveness of the exercise of an Incentive Award
has been deferred, the Grantee may, by written notice to the Committee, withdraw
such exercise and obtain the refund of any amount paid with respect
thereto.

       

      
        
          
          

        

        
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6.5 Change in Stock and
Adjustments

      

      (a)  Changes
in Law or Circumstances.
Subject to Section 6.7
(which only applies in the event of a Change in Control), in the event of any
change in applicable law or any change in circumstances which results in or
would result in any dilution of the rights granted under the Plan, or which
otherwise warrants an equitable adjustment because it interferes with the
intended operation of the Plan, then, if the Committee should so determine, in
its absolute discretion, that such change equitably requires an adjustment in
the number or kind of shares of stock or other securities or property
theretofore subject, or which may become subject, to issuance or transfer under
the Plan or in the terms and conditions of outstanding Incentive Awards, such
adjustment shall be made in accordance with such determination. Such adjustments
may include changes with respect to (i) the aggregate number of Shares that
may be issued under the Plan, (ii) the number of Shares subject to
Incentive Awards, and (iii) the Option Price or other price per Share for
outstanding Incentive Awards. Any adjustment under this paragraph of an
outstanding Incentive Stock Option shall be made only to the extent not
constituting a “modification” within the meaning of Section 424(h)(3) of
the Code or with respect to any Incentive Award to the extent it does not result
in deferred compensation under Code Section 409A unless otherwise agreed to
by the Grantee in writing. The Committee shall give notice to each applicable
Grantee of such adjustment which shall be effective and binding.

       

      (b)   Exercise
of Corporate Powers.
The existence of the Plan or outstanding Incentive Awards hereunder shall
not affect in any way the right or power of the Company or its stockholders to
make or authorize any or all adjustments, recapitalization, reorganization or
other changes in the Company’s capital structure or its business or any merger
or consolidation of the Company, or any issue of bonds, debentures, preferred or
prior preference stocks ahead of or affecting the Common Stock or the rights
thereof, or the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business, or any other corporate
act or proceeding whether of a similar character or otherwise.

       

      (c)  Recapitalization
of the Company.
Subject to Section 6.7
(which only applies in the event of a Change in Control), if while there are
Incentive Awards outstanding, the Company shall effect any subdivision or
consolidation of Shares of Common Stock or other capital readjustment, the
payment of a stock dividend, stock split, combination of Shares,
recapitalization or other increase or reduction in the number of Shares
outstanding, without receiving compensation therefor in money, services or
property, then the number of Shares available under the Plan and the number of
Incentive Awards which may thereafter be exercised shall (i) in the event
of an increase in the number of Shares outstanding, be proportionately increased
and the Option Price or Fair Market Value of the Incentive Awards awarded shall
be proportionately reduced; and (ii) in the event of a reduction in the
number of Shares outstanding, be proportionately reduced, and the Option Price
or Fair Market Value of the Incentive Awards awarded shall be proportionately
increased. The Committee shall take such action and whatever other action it
deems appropriate, in its discretion, so that the value of each outstanding
Incentive Award to the Grantee shall not be adversely affected by a corporate
event described in this subsection (c). Notwithstanding the foregoing
adjustments pursuant to this paragraph shall be made only if permitted and in
accordance with Code Sections 424 and 409A to the extent applicable to an
Incentive Award unless otherwise consented to in writing by the
Grantee.

       

      
        
          
          

        

        
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      (d)  Issue of
Common Stock by the Company. Except as hereinabove
expressly provided in this Section 6.5 and
subject to Section 6.7 in
the event of a Change in Control, the issue by the Company of shares of stock of
any class, or securities convertible into shares of stock of any class, for cash
or property, or for labor or services, either upon direct sale or upon the
exercise of rights or warrants to subscribe therefor, or upon any conversion of
shares or obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number of, or Option Price or Fair Market Value of, any
Incentive Awards then outstanding under previously granted Incentive Awards;
provided, however, in such event, outstanding Shares of Restricted Stock shall
be treated the same as outstanding unrestricted Shares of Common
Stock.

       

      (e)  Assumption
under the Plan of Outstanding Stock Options. Notwithstanding any other
provision of the Plan, the Committee, in its absolute discretion, may authorize
the assumption and continuation under the Plan of outstanding and unexercised
stock options or other types of stock-based incentive awards that were granted
under a stock option plan (or other type of stock incentive plan or agreement)
that is or was maintained by a corporation or other entity that was merged into,
consolidated with, or whose stock or assets were acquired by, the Company as the
surviving corporation. Any such action shall be upon such terms and conditions
as the Committee, in its discretion, may deem appropriate, including provisions
to preserve the holder’s rights under the previously granted and unexercised
stock option or other stock-based incentive award, such as, for example,
retaining the treatment as a Stock Option. Any such assumption and continuation
of any such previously granted and unexercised incentive award shall be treated
as an outstanding Incentive Award under the Plan and shall thus count against
the number of Shares reserved for issuance pursuant to Section 1.4. In
addition, any Shares issued by the Company through the assumption or
substitution of outstanding grants from an acquired company shall reduce the
Shares available for grants under Section 1.4.

       

      (f)  Assumption
of Incentive Awards by a Successor. Subject to the accelerated
vesting and other provisions of Section 6.7 that
apply in the event of a Change in Control, in the event of a Corporate Event
(defined below), each Grantee shall be entitled to receive, in lieu of the
number of Shares subject to Incentive Awards, such shares of capital stock or
other securities or property as may be issuable or payable with respect to or in
exchange for the number of Shares which Grantee would have received had he
exercised the Incentive Award immediately prior to such Corporate Event,
together with any adjustments (including, without limitation, adjustments to the
Option Price and the number of Shares issuable on exercise of outstanding Stock
Options). For this purpose, Shares of Restricted Stock shall be treated the same
as unrestricted outstanding Shares of Common Stock. A “Corporate Event” means any of
the following: (i) a dissolution or liquidation of the Company, (ii) a
sale of all or substantially all of the Company’s assets, (iii) a merger,
consolidation or combination involving the Company (other than a merger,
consolidation or combination (A) in which the Company is the continuing or
surviving corporation and (B) which does not result in the outstanding Shares
being converted into or exchanged for different securities, cash or other
property, or any combination thereof), or (iv) if so determined by the
Committee, any other “corporate transaction” as defined in Code Sections 424 or
Code Section 409A. The Committee shall take whatever other action it deems
appropriate to preserve the rights of Grantees holding outstanding Incentive
Awards.

       

      
        
          
          

        

        
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      Notwithstanding
the previous paragraph of this Section 6.5(f),
but subject to the accelerated vesting and other provisions of Section 6.7 that
apply in the event of a Change in Control, in the event of a Corporate Event
(described in the previous paragraph), the Committee, in its discretion, shall
have the right and power to:

       

      (i)
cancel, effective immediately prior to the occurrence of the Corporate Event,
each outstanding Incentive Award (whether or not then exercisable) and, in full
consideration of such cancellation, pay to the Grantee an amount in cash equal
to the excess of (A) the value, as determined by the Committee, of the
property (including cash) received by the holders of Common Stock as a result of
such Corporate Event over (B) the exercise price of such Incentive Award,
if any; provided, however, this subsection (i) shall be inapplicable to an
Incentive Award granted within six (6) months before the occurrence of the
Corporate Event but only if the Grantee is an Insider and such disposition is
not exempt under Rule 16b-3 (or other rules preventing liability of the
Insider under Section 16(b) of the Exchange Act) and, in that event, the
provisions hereof shall be applicable to such Incentive Award after the
expiration of six (6) months from the date of grant; or

       

      (ii)
provide for the exchange or substitution of each Incentive Award outstanding
immediately prior to such Corporate Event (whether or not then exercisable) for
another award with respect to the Common Stock or other property for which such
Incentive Award is exchangeable and, incident thereto, make an equitable
adjustment as determined by the Committee, in its discretion, in the Option
Price or exercise price of the Incentive Award, if any, or in the number of
Shares or amount of property (including cash) subject to the Incentive Award;
or

       

      (iii)
provide for assumption of the Plan and such outstanding Incentive Awards by the
surviving entity or its parent.

       

      The
Committee, in its discretion, shall have the authority to take whatever action
it deems to be necessary or appropriate to effectuate the provisions of this
subsection
(f).

      

      
        
          
          

        

        
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      6.6 Termination of Employment, Death,
Disability and Retirement

      

      (a)  Termination
of Employment.
Unless otherwise expressly provided in the Grantee’s Incentive Agreement,
if the Grantee’s Employment is terminated for any reason other than due to his
death, Disability, Retirement or for Cause, any non-vested portion of any Stock
Option or other applicable Incentive Award at the time of such termination shall
automatically expire and terminate and no further vesting shall occur after the
termination date. In such event, except as otherwise expressly provided in his
Incentive Agreement, the Grantee shall be entitled to exercise his rights only
with respect to the portion of the Incentive Award that was vested as of his
termination of Employment date for a period that shall end on the earlier of
(i) the expiration date set forth in the Incentive Agreement or
(ii) ninety (90) days after the date of his termination of Employment
(three (3) months for Incentive Stock Options).

       

      (b)  Termination
of Employment for Cause.
Unless otherwise expressly provided in the Grantee’s Incentive Agreement,
in the event of the termination of a Grantee’s Employment for Cause, all vested
and non-vested Stock Options and other Incentive Awards granted to such Grantee
shall immediately expire, and shall not be exercisable to any extent, as of
12:01 a.m. (CST) on the date of such termination of
Employment.

       

      (c)  Retirement. Unless otherwise expressly
provided in the Grantee’s Incentive Agreement, upon the termination of
Employment due to the Retirement of any Employee who is a Grantee:

       

      (i) any
non-vested portion of any outstanding Option or other Incentive Award shall
immediately terminate and no further vesting shall occur; and

       

      (ii) any
vested Option or other Incentive Award shall expire on the earlier of
(A) the expiration date set forth in the Incentive Agreement for such
Incentive Award; or (B) the expiration of (1) six months after the
date of his termination of Employment due to Retirement in the case of any
Incentive Award other than an Incentive Stock Option or (2) three months after
his termination date in the case of an Incentive Stock Option.

      

      (d)  Disability
or Death. Unless
otherwise expressly provided in the Grantee’s Incentive Agreement, upon
termination of Employment as a result of the Grantee’s Disability or
death:

       

      (i) any
nonvested portion of any outstanding Option or other applicable Incentive Award
shall immediately terminate upon termination of Employment and no further
vesting shall occur; and

       

      (ii) any
vested Incentive Award shall expire on the earlier of either (A) the
expiration date set forth in the Incentive Agreement or (B) the one year
anniversary date of the Grantee’s termination of Employment date.

       

      
        
          
          

        

        
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      In the
case of any vested Incentive Stock Option held by an Employee following
termination of Employment, notwithstanding the definition of “Disability” in
Section 1.2,
whether the Employee has incurred a “Disability” for purposes of determining the
length of the Option exercise period following termination of Employment under
this subsection
(d) shall be determined by reference to Section 22(e)(3) of the Code
to the extent required by Section 422(c)(6) of the Code. The Committee
shall determine whether a Disability for purposes of this subsection
(d) has occurred.

       

      (e)  Continuation. Subject to the conditions
and limitations of the Plan and applicable law and regulation in the event that
a Grantee ceases to be an Employee, Outside Director or Consultant, as
applicable, for whatever reason, the Committee and Grantee may mutually agree
with respect to any outstanding Option or other Incentive Award then held by the
Grantee (i) for an acceleration or other adjustment in any vesting schedule
applicable to the Incentive Award, (ii) for a continuation of the exercise
period following termination for a longer period than is otherwise provided
under such Incentive Award, or (iii) to any other change in the terms and
conditions of the Incentive Award. In the event of any such change to an
outstanding Incentive Award, a written amendment to the Grantee’s Incentive
Agreement shall be required.

      

      6.7  Change in Control

      

      Notwithstanding
any contrary provision in the Plan, in the event of a Change in Control (as
defined below), the following actions shall automatically occur as of the day
immediately preceding the Change in Control date unless expressly provided
otherwise in the individual Grantee’s Incentive Agreement:

       

      (a) all
of the Stock Options and Stock Appreciation Rights then outstanding shall become
100% vested and immediately and fully exercisable;

       

      (b) all
of the restrictions and conditions of any Restricted Stock and any Other
Stock-Based Awards then outstanding shall be deemed satisfied, and the
Restriction Period with respect thereto shall be deemed to have expired, and
thus each such Incentive Award shall become free of all restrictions and fully
vested; and

       

      (c) all
of the Performance Shares, Performance Units and any Other Stock-Based Awards
shall become fully vested, deemed earned in full, and promptly paid within
thirty (30) days to the affected Grantees without regard to payment
schedules and notwithstanding that the applicable performance cycle, retention
cycle or other restrictions and conditions have not been completed or
satisfied.

       

      For all
purposes of this Plan, a “Change in Control” of the
Company means the occurrence of any one or more of the following
events:

       

      
        
          
          

        

        
          32

          
            

          

        

        
          
          

        

      

       

      (a) The
acquisition by any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act (a “Person”)) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange
Act) of fifty percent (50%) or more of either (i) the then outstanding
shares of common stock of the Company (the “Outstanding Company Stock”) or
(ii) the combined voting power of the then outstanding voting securities of
the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting
Securities”); provided, however, that the following acquisitions shall
not constitute a Change in Control: (i) any acquisition directly from the
Company or any Subsidiary, (ii) any acquisition by the Company or any
Subsidiary or by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any Subsidiary, or (iii) any acquisition by any
corporation pursuant to a reorganization, merger, consolidation or similar
business combination involving the Company (a “Merger”), if, following such
Merger, the conditions described in clauses (i) and (ii) Section 6.7(c)
(below) are satisfied;

       

      (b)
Individuals who, as of the Effective Date, constitute the Board of Directors of
the Company (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the Effective Date whose election, or nomination for election by the Company’s
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest (as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the Exchange
Act) or other actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board;

       

      (c)
Approval by the shareholders of the Company of a Merger, unless immediately
following such Merger, (i) substantially all of the holders of the
Outstanding Company Voting Securities immediately prior to Merger beneficially
own, directly or indirectly, more than 50% of the common stock of the
corporation resulting from such Merger (or its parent corporation) in
substantially the same proportions as their ownership of Outstanding Company
Voting Securities immediately prior to such Merger and (ii) at least a
majority of the members of the board of directors of the corporation resulting
from such Merger (or its parent corporation) were members of the Incumbent Board
at the time of the execution of the initial agreement providing for such
Merger;

       

      (d) The
sale or other disposition of all or substantially all of the assets of the
Company, unless immediately following such sale or other disposition,
(i) substantially all of the holders of the Outstanding Company Voting
Securities immediately prior to the consummation of such sale or other
disposition beneficially own, directly or indirectly, more than 50% of the
common stock of the corporation acquiring such assets in substantially the same
proportions as their ownership of Outstanding Company Voting Securities
immediately prior to the consummation of such sale or disposition, and (ii) at least a
majority of the members of the board of directors of such corporation (or its
parent corporation) were members of the Incumbent Board at the time of execution
of the initial agreement or action of the Board providing for such sale or other
disposition of assets of the Company;

       

      
        
          
          

        

        
          33

          
            

          

        

        
          
          

        

      

       

      (e) The
adoption of any plan or proposal for the liquidation or dissolution of the
Company; or

       

      (f) Any
other event that a majority of the Board, in its sole discretion, determines to
constitute a Change in Control hereunder.

       

      Notwithstanding
the occurrence of any of the foregoing events set out in this Section 6.7 which
would otherwise result in a Change in Control, the Board may determine in its
discretion, if it deems it to be in the best interest of the Company, that an
event or events otherwise constituting or reasonably leading to a Change in
Control shall not be deemed a Change in Control hereunder. Such determination
shall be effective only if it is made by the Board prior to the occurrence of an
event that otherwise would be, or reasonably lead to, a Change in Control, or
after such event only if made by the Board a majority of which is composed of
directors who were members of the Board immediately prior to the event that
otherwise would be, or reasonably lead to, a Change in Control.

      

      6.8 
Financing

           

      To the
extent permitted by the Sarbanes-Oxley Act of 2002 and other applicable law, the
Company may extend and maintain, or arrange for and guarantee, the extension and
maintenance of financing to any Grantee to purchase Shares pursuant to exercise
of an Incentive Award upon such terms as are approved by the Committee in its
discretion.

       

      

      SECTION 7

      

      GENERAL

      

      7.1  Effective Date and Grant
Period

           

      This Plan
is adopted by the Board effective as of the Effective Date, subject to the
approval of the stockholders of the Company within twelve (12) months from
the Effective Date. Incentive Awards may be granted under the Plan at any time
prior to receipt of such stockholder approval; provided, however, if the
requisite stockholder approval is not obtained within the permissible time frame
then any Incentive Awards granted hereunder shall automatically become null and
void and of no force or effect. No Incentive Award may be granted under the Plan
after ten (10) years from the Effective Date.

       

      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      

      
7.2  Funding and Liability of
Company

      

      No
provision of the Plan shall require the Company, for the purpose of satisfying
any obligations under the Plan, to purchase assets or place any assets in a
trust or other entity to which contributions are made, or otherwise to segregate
any assets. In addition, the Company shall not be required to maintain separate
bank accounts, books, records or other evidence of the existence of a segregated
or separately maintained or administered fund for purposes of the Plan. Although
bookkeeping accounts may be established with respect to Grantees who are
entitled to cash, Common Stock or rights thereto under the Plan, any such
accounts shall be used merely as a bookkeeping convenience. The Company shall
not be required to segregate any assets that may at any time be represented by
cash, Common Stock or rights thereto. The Plan shall not be construed as
providing for such segregation, nor shall the Company, the Board or the
Committee be deemed to be a trustee of any cash, Common Stock or rights thereto.
Any liability or obligation of the Company to any Grantee with respect to an
Incentive Award shall be based solely upon any contractual obligations that may
be created by this Plan and any Incentive Agreement, and no such liability or
obligation of the Company shall be deemed to be secured by any pledge or other
encumbrance on any property of the Company. Neither the Company, the Board nor
the Committee shall be required to give any security or bond for the performance
of any obligation that may be created by the Plan.

      

      7.3  Withholding Taxes

       

      (a) Tax
Withholding. The
Company shall have the power and the right to deduct or withhold, or require a
Grantee to remit to the Company, an amount sufficient to satisfy federal, state,
and local taxes, domestic or foreign, required by law or regulation to be
withheld with respect to any taxable event arising as a result of the Plan or an
Incentive Award hereunder. Upon the lapse of restrictions on Restricted Stock,
the Committee, in its discretion, may elect to satisfy the tax withholding
requirement, in whole or in part, by having the Company withhold Shares having a
Fair Market Value on the date the tax is to be determined equal to the minimum
withholding taxes which could be imposed on the transaction as determined by the
Committee.

       

      (b) Share
Withholding. With
respect to tax withholding required upon the exercise of Stock Options or SARs,
upon the lapse of restrictions on Restricted Stock, or upon any other taxable
event arising as a result of any Incentive Awards, Grantees may elect, subject
to the approval of the Committee in its discretion, to satisfy the withholding
requirement, in whole or in part, by having the Company withhold Shares having a
Fair Market Value on the date the tax is to be determined equal to the minimum
withholding taxes which could be imposed on the transaction as determined by the
Committee. All such elections shall be made in writing, signed by the Grantee,
and shall be subject to any restrictions or limitations that the Committee, in
its discretion, deems appropriate.

       

      (c) Incentive
Stock Options.
With respect to Shares received by a Grantee pursuant to the exercise of
an Incentive Stock Option, if such Grantee disposes of any such Shares within
(i) two years from the date of grant of such Option or (ii) one year
after the transfer of such shares to the Grantee, the Company shall have the
right to withhold from any salary, wages or other compensation payable by the
Company to the Grantee an amount sufficient to satisfy federal, state and local
tax withholding requirements attributable to such disqualifying
disposition.

       

      
        
          
          

        

        
          35

          
            

          

        

        
          
          

        

      

       

      (d) Loans. To the extent permitted by
the Sarbanes-Oxley Act of 2002 and other applicable law, the Committee may
provide for loans, on either a short term or demand basis, from the Company to a
Grantee who is an Employee or Consultant to permit the payment of taxes required
by law.

      

      7.4  No Guarantee of Tax
Consequences

      

      Neither
the Company nor the Committee makes any commitment or guarantee that any
federal, state or local tax treatment will apply or be available to any person
participating or eligible to participate hereunder.

      

      7.5  Designation of Beneficiary by
Grantee

      

      Each
Grantee may, from time to time, name any beneficiary or beneficiaries (who may
be named contingently or successively) to whom any benefit under the Plan is to
be paid in case of his death before he receives any or all of such benefit. Each
such designation shall revoke all prior designations by the same Grantee, shall
be in a form prescribed by the Committee, and will be effective only when filed
by the Grantee in writing with the Committee during the Grantee’s lifetime. In
the absence of any such designation, benefits remaining unpaid at the Grantee’s
death shall be paid to the Grantee’s estate.

      

      7.6  Deferrals

      

      The
Committee may permit a Grantee to defer such Grantee’s receipt of the payment of
cash or the delivery of Shares that would, otherwise be due to such Grantee by
virtue of the lapse or waiver of restrictions with respect to Restricted Stock,
or the satisfaction of any requirements or goals with respect to Performance
Units, Performance Shares or Other Stock-Based Awards. If any such deferral
election is permitted, the Committee shall, in its discretion, establish rules
and procedures for such payment deferrals to the extent required for tax
deferral of compensation under the Code.

      

      7.7 
Amendment and
Termination

      

      The Board
shall have the power and authority to terminate or amend the Plan at any time;
provided, however, the Board shall not, without the approval of the stockholders
of the Company within the time period required by applicable law,
(a) except as provided in Section 6.5,
increase the maximum number of Shares which may be issued under the Plan
pursuant to Section
1.4, (b) amend the requirements as to the class of Employees
eligible to purchase Common Stock under the Plan, (c) extend the term of
the Plan, or, if the Company is a Publicly Held Corporation (i) increase
the maximum limits on Incentive Awards to Employees as set for compliance with
the Performance-Based Exception or (ii) decrease the authority granted to
the Committee under the Plan in contravention of Rule 16b-3 under the
Exchange Act.

       

      
        
          
          

        

        
          36

          
            

          

        

        
          
          

        

      

       

      No
termination, amendment, or modification of the Plan shall adversely affect in
any material way any outstanding Incentive Award previously granted to a Grantee
under the Plan, without the written consent of such Grantee or other designated
holder of such Incentive Award.

       

      In
addition, to the extent that the Committee determines that (a) the listing
for qualification requirements of any national securities exchange or quotation
system on which the Company’s Common Stock is then listed or quoted, if
applicable, or (b) the Code (or regulations promulgated thereunder),
require stockholder approval in order to maintain compliance with such listing
requirements or to maintain any favorable tax advantages or qualifications, then
the Plan shall not be amended in such respect without approval of the Company’s
stockholders.

      

      7.8  Requirements of
Law

      

      (a) Governmental
Entities and Securities Exchanges. The granting of Incentive Awards and
the issuance of Shares under the Plan shall be subject to all applicable laws,
rules, and regulations, and to such approvals by any governmental agencies or
national securities exchanges as may be required. The Committee may in its
discretion refuse to issue or transfer any Shares or other consideration under
an Incentive Award if it determines that the issuance or transfer of such Shares
or other consideration might violate applicable laws including, but not limited
to, compliance with black out periods required pursuant to applicable law or
Company policies. Certificates evidencing shares of Common Stock delivered under
this Plan (to the extent that such shares are so evidenced) may be subject to
such stop transfer orders and other restrictions as the Committee may deem
advisable under the rules and regulations of the Securities and Exchange
Commission, any securities exchange or transaction reporting system upon which
the Common Stock is then listed or to which it is admitted for quotation, and
any applicable federal or state securities law, if applicable. The Committee may
cause a legend or legends to be placed upon such certificates (if any) to make
appropriate reference to such restrictions.

       

      (b) Securities
Act Rule 701. If no class of the Company’s securities is registered
under Section 12 of the Exchange Act, then unless otherwise determined
by the Committee, grants of Incentive Awards to “Rule 701 Grantees” (as
defined below) and issuances of the underlying shares of Common Stock, if
any, on the exercise or conversion of such Incentive Awards are intended to
comply with all applicable conditions of Securities Act Rule 701
(“Rule 701”), including, without limitation, the restrictions
as to the amount of securities that may be offered and sold in
reliance on Rule 701, so as to qualify for an exemption from the
registration requirements of the Securities Act. Any ambiguities or
inconsistencies in the construction of an Incentive Award or the Plan shall be
interpreted to give effect to such intention. In accordance with Rule 701,
each Grantee shall receive a copy of the Plan on or before the date an
Incentive Award is granted to him, as well as the additional disclosure
required by Rule 701(e) if the aggregate sales price or amount of
securities sold during any consecutive 12-month period exceeds $5,000,000 as
determined under Rule 701(e). If Rule 701 (or any successor provision)
is amended to eliminate or otherwise modify any of the requirements
specified in Rule 701, then the provisions of this subsection 7.8(b)
shall be interpreted and construed in accordance with Rule 701 as so
amended. For purposes of this subsection 7.8(b),
as determined in accordance with Rule 701, “Rule 701 Grantees” shall
mean any Grantee other than a director of the Company, the Company’s
chairman, chief executive officer, president, chief financial officer,
controller and any vice president of the Company, and any other key employee of
the Company who generally has access to financial and other business
related information and possesses sufficient sophistication to understand
and evaluate such information.

       

      
        
          
          

        

        
          37

          
            

          

        

        
          
          

        

      

      
7.9  Rule 16b-3 Securities Law
Compliance for Insiders

      

      If the
Company is a Publicly Held Corporation, transactions under the Plan with respect
to Insiders are intended to comply with all applicable conditions of
Rule 16b-3 under the Exchange Act. Any ambiguities or inconsistencies in
the construction of an Incentive Award or the Plan shall be interpreted to give
effect to such intention, and to the extent any provision of the Plan or action
by the Committee fails to so comply, it shall be deemed null and void to the
extent permitted by law and deemed advisable by the Committee in its
discretion.

      

      7.10 
Compliance with Code Section
162(m) for Publicly Held Corporation

      

      If the
Company is a Publicly Held Corporation, unless otherwise determined by the
Committee with respect to any particular Incentive Award, it is intended that
the Plan shall comply fully with the applicable requirements so that any
Incentive Awards subject to Section 162(m) that are granted to Covered Employees
shall qualify for the Performance-Based Exception, except for grants of
Nonstatutory Stock Options with an Option Price set at less than the Fair Market
Value of a Share on the date of grant. If any provision of the Plan or an
Incentive Agreement would disqualify the Plan or would not otherwise permit the
Plan or Incentive Award to comply with the Performance-Based Exception as so
intended, such provision shall be construed or deemed to be amended to conform
to the requirements of the Performance-Based Exception to the extent permitted
by applicable law and deemed advisable by the Committee; provided, however, no
such construction or amendment shall have an adverse effect on the prior grant
of an Incentive Award or the economic value to a Grantee of any outstanding
Incentive Award.

      

      
        
          
          

        

        
          38

          
            

          

        

        
          
          

        

      

      

      7.11 
Successors to
Company

      

      All
obligations of the Company under the Plan with respect to Incentive Awards
granted hereunder shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.

      

      7.12 
Miscellaneous
Provisions

      

      (a) No
Employee, Consultant, Outside Director, or other person shall have any claim or
right to be granted an Incentive Award under the Plan. Neither the Plan, nor any
action taken hereunder, shall be construed as giving any Employee, Consultant,
or Outside Director any right to be retained in the Employment or other service
of the Company or any Parent or Subsidiary.

       

      (b) The
expenses of the Plan shall be borne by the Company.

       

      (c) By
accepting any Incentive Award, each Grantee and each person claiming by or
through him shall be deemed to have indicated his acceptance of the
Plan.

       

      (d) No
Shares of Common Stock shall be issued hereunder unless counsel for the Company
is then reasonably satisfied that such issuance will be in compliance with
federal and state securities laws, if applicable.

      

      7.13 
Severability

      

      In the
event that any provision of this Plan shall be held illegal, invalid or
unenforceable for any reason, such provision shall be fully severable, but shall
not affect the remaining provisions of the Plan, and the Plan shall be construed
and enforced as if the illegal, invalid, or unenforceable provision was not
included herein.

      

      7.14  Gender, Tense and
Headings

      

      Whenever
the context so requires, words of the masculine gender used herein shall include
the feminine and neuter, and words used in the singular shall include the
plural. Section headings as used herein are inserted solely for convenience and
reference and constitute no part of the interpretation or construction of the
Plan.

      

      7.15 
Governing
Law

      

      The Plan
shall be interpreted, construed and constructed in accordance with the laws of
the State of Nevada without regard to its conflicts of law provisions, except as
may be superseded by applicable laws of the United States.

       

      
        
          
          

        

        
          39

          
            

          

        

        
          
          

        

      

      
7.16 
Code
Section 409A

      

      To the
extent that any Incentive Award is deferred compensation subject to Code
Section 409A, as determined by the Committee, the Incentive Agreement shall
comply with the requirements of Code Section 409A in a manner as determined
by the Committee in its sole discretion including, but not limited to, using the
more restrictive definition of Change in Control as provided in Code Section
409A to the extent that it is more restrictive than as defined in the Plan,
using the more restrictive definition of Disability or disabled as provided in
Code Section 409A and specifying a time and form of payment schedule. In
addition if any Incentive Award constitutes deferred compensation under
Section 409A of the Code (a “Section 409A Plan”), then
the Incentive Award shall be subject to the following requirements, if and to
the extent required to comply with Code Section 409A, and as determined by the
Committee and specified in the Incentive Agreement:

       

      (a)
Payments under the Section 409A Plan may not be made earlier than
(i) the Grantee’s separation from service, (ii) the date the Grantee
becomes disabled, (iii) the Grantee’s death, (iv) a specified time (or
pursuant to a fixed schedule) specified in the Incentive Agreement at the date
of the deferral of such compensation, (v) a change in the ownership or
effective control of the corporation, or in the ownership of a substantial
portion of the assets of the corporation, or (vi) the occurrence of an
unforeseeable emergency;

       

      (b) The
time or schedule for any payment of the deferred compensation may not be
accelerated, except to the extent provided in applicable Treasury Regulations or
other applicable guidance issued by the Internal Revenue Service;

       

      (c) Any
elections with respect to the deferral of such compensation or the time and form
of distribution of such deferred compensation shall comply with the requirements
of Section 409A(a)(4) of the Code; and

       

      (d) In
the case of any Grantee who is specified employee, a distribution on account of
a separation from service may not be made before the date which is six months
after the date of the Grantee’s separation from service (or, if earlier, the
date of the Grantee’s death).

       

      For
purposes of the foregoing, the terms “separation from
service” and “specified employee”,
all shall be defined in the same manner as those terms are defined for purposes
of Section 409A of the Code, and the limitations set forth herein shall be
applied in such manner (and only to the extent) as shall be necessary to comply
with any requirements of Section 409A of the Code that are applicable to
the Incentive Award as determined by the Committee.

      

       

      *    *    *    *    *

       

      
        
          
          

        

        
          40

          
            

          

        

        
          
          

        

      

      

      The
foregoing VivaKor, Inc. 2008 Incentive Plan was adopted by the Board of
Directors of the Company on October 28, 2008 and by the Shareholders of the
Company on October 28, 2008.

       

       

      
        	 	

                VIVAKOR,
      INC.

                 

                /S/     
      TANNIN J.
      FUJA, PHD.        
      

                Name:  Tannin
      J. Fuja, PhD.

                Title:
      Chief Executive Officer

              

      

    

     

     

     

    41vivakor_s1-ex1002.htm

    EXHIBIT
10.2

     

    THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE
U.S. SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE OR FOREIGN
JURISDICTION, AND MAY BE OFFERED AND SOLD ONLY IF REGISTERED AND QUALIFIED
PURSUANT TO THE RELEVANT PROVISIONS OF U.S. FEDERAL AND STATE OR APPLICABLE
FOREIGN SECURITIES LAWS OR IF THE COMPANY IS PROVIDED AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT REGISTRATION AND QUALIFICATION UNDER U.S.
FEDERAL AND STATE OR APPLICABLE FOREIGN SECURITIES LAWS IS NOT
REQUIRED.

     

    

     

    VIVAKOR,
INC.

    2008
INCENTIVE PLAN

    NOTICE OF
INCENTIVE STOCK OPTION GRANT

     

    VIVAKOR,
INC. (the “Company”) hereby grants you the following Option to purchase
shares of its common stock (“Shares”).  The terms and conditions of
this Option are set forth in the Incentive Agreement (“Incentive Agreement”)
that follows and the VIVAKOR,
INC. 2008 Incentive Plan (the “Plan”), both of which are attached to and
made a part of this document.  This page is meant to be a cover page
for informational purposes only, in the event any of the terms hereon are in
conflict with the Incentive Option Agreement and/or the Plan, the terms of the
Incentive Option Agreement and/or the Plan shall supersede the information on
this page.

     

    
      	
              Date
      of Grant:

            	 
      
	 	 
	
              Name
      of Optionee:

            	 
      
	 	 
	
              Number
      of Option Shares:

            	 
      
	 	 
	
              Exercise
      Price per Share:

            	
              $

            
	 	 
	
              Vesting
      Start Date:

            	 
      
	 	 	 
	
              Type
      of Option:

            	
              x Incentive Stock Option

            	
              o Nonstatutory Stock  Option

            
	 	 
	
              Vesting
      Schedule:

            	
              Decided
      by resolution of the Board of Directors.

            
	 	 
	
              Payment
      Forms:

            	
              By
      cash, cash equivalents, or Shares owned by the Optionee for at least six
      months, and if the Company’s Shares become publicly traded, by “cashless”
      exercise, as set forth in the Stock Option
  Agreement.

            

    

    

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    VIVAKOR, INC.

    

    INCENTIVE
AGREEMENT

    

    Optionee:
____________________________________

    

    
      	
              1.  

            	
              Grant
      of Stock Option. As of the Date of Grant
      (identified in Section 19 below), VivaKor, Inc., a Nevada
      corporation (the “Company”), hereby grants
      an Incentive Stock Option (the “Option”) to the Optionee
      (identified above), an employee of the Company, to purchase the number of
      shares of the Company’s common stock, $_____ par value per share (the
      “Common Stock”),
      identified in Section 19 below (the “Shares”), subject to the
      terms and conditions of this agreement (the “Agreement”) and the
      Company’s 2008 Incentive Plan effective February 1, 2008 (the “Plan”), which is hereby
      incorporated herein in its entirety by reference. The Shares, when issued
      to the Optionee upon the exercise of the Option, shall be fully paid and
      nonassessable. The Option is an “incentive stock option” as defined in
      Section 422 of the Internal Revenue
Code.

            

    

    

    
      	
              2.  

            	
              Definitions.
      All capitalized terms used herein shall have the meanings set forth in the
      Plan unless otherwise specifically provided herein. Section 19 below
      sets forth meanings for various capitalized terms used in this
      Agreement.

            

    

    

    
      	
              3.  

            	
              Option
      Term. The Option shall commence on the Date of Grant (identified in
      Section 19 below) and terminate on the date immediately prior to the
      tenth (10th)
      anniversary of the Date of Grant. The period during which the Option is in
      effect and may be exercised is referred to herein as the “Option
      Period.”

            

    

    

    
      	
              4.  

            	
              Option
      Price. The Option Price per Share is identified in Section 19
      below.

            

    

    

    
      	
              5.  

            	
              Vesting.
      The total number of Shares subject to this Option shall vest in accordance
      with the Vesting Schedule
      (identified in Section 19 below). The Shares may be purchased
      at any time after they become vested, in whole or in part, during the
      Option Period; provided, however, the Option may only be exercisable to
      acquire whole Shares. The right of exercise provided herein shall be
      cumulative so that if the Option is not exercised to the maximum extent
      permissible after vesting, the vested portion of the Option shall be
      exercisable, in whole or in part, at any time during the Option
      Period.

            

    

    

    
      	
              6.  

            	
              Method
      of Exercise. The Option is exercisable by delivery of a written
      notice to the attention of the Chief Financial Officer of the Company at
      the address for notices to the Company provided below, signed by the
      Optionee, specifying the number of Shares to be acquired on, and the
      effective date of, such exercise. The Optionee may withdraw notice of
      exercise of this Option, in writing, at any time prior to the close of
      business on the business day preceding the proposed exercise
      date.

            

    

    

    
      	
              7.  

            	
              Method of Payment. The
      Option Price upon exercise of the Option shall be payable to the Company
      in full either: (i) in cash or its equivalent, or (ii) subject
      to prior approval by the Committee in its discretion, by tendering
      previously acquired Shares having an aggregate Fair Market Value (as
      defined in the Plan) at the time of exercise equal to the total Option
      Price (provided that the Shares must have been held by the Optionee for at
      least six (6) months prior to their tender to satisfy the Option
      Price), or (iii) subject to prior approval by the Board of Directors
      or Compensation Committee in its discretion, by withholding Shares which
      otherwise would be acquired on exercise having an aggregate Fair Market
      Value at the time of exercise equal to the total Option Price (as
      determined pursuant to Section 2.3 of the Plan), or (iv) subject
      to prior approval by the Board of Directors or Compensation Committee in
      its discretion, by a combination of (i), (ii), and (iii) above. Any
      payment in shares of Common Stock shall be effected by the delivery of
      such shares to the Chief Financial Officer of the Company, duly endorsed
      in blank or accompanied by stock powers duly executed in blank, together
      with any other documents as the Chief Financial Officer may require. If
      the payment of the Option Price is remitted partly in Shares, the balance
      of the payment of the Option Price shall be paid in either cash, certified
      check, bank cashiers’ check, or by wire
  transfer.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
The Board
of Directors or Compensation Committee, in its discretion, may allow (i) a
“cashless exercise” as permitted under Federal Reserve Board’s
Regulation T, 12 CFR Part 220 (or its successor), and subject to
applicable securities law restrictions and tax withholdings, or (ii) any
other means of exercise which the Board of Directors or Compensation Committee,
in its discretion, determines to be consistent with the Plan’s purpose and
applicable law.

     

    As soon
as practicable after receipt of a written notification of exercise and full
payment, the Company shall deliver to or on behalf of the Optionee, in the name
of the Optionee or other appropriate recipient, Share certificates for the
number of Shares purchased under the Option. Such delivery shall be effected for
all purposes when a stock transfer agent of the Company shall have deposited
such certificates in the United States mail, addressed to Optionee or other
appropriate recipient.

    

    
      	
              8.  

            	
              Restrictions
      on Exercise. The Option may not be exercised if the issuance of
      such Shares or the method of payment of the consideration for such Shares
      would constitute a violation of any applicable federal or state securities
      or other laws or regulations, including any such laws or regulations or
      Company policies respecting blackout periods, or any rules or regulations
      of any stock exchange on which the Common Stock may be
    listed.

            

    

    

    
      	
              9.  

            	
              Termination
      of Employment. Voluntary or involuntary termination of Employment
      and the death or Disability of Optionee shall affect Optionee’s rights
      under the Option as follows:

            

    

    

    
      	
              (a)
        

            	
              Termination for
      Cause. The vested and non-vested portions of the Option shall
      expire on 12:01 am. (PT) on the date of termination of Employment and
      shall not be exercisable to any extent if Optionee’s Employment with the
      Company is terminated for Cause (as defined in the Plan at the time of
      such termination of Employment).

            

    

    

    
      	
              (b)
        

            	
               Other Involuntary
      Termination or Voluntary Termination. If Optionee’s Employment with
      the Company is terminated for any reason other than for Cause, retirement,
      death or Disability (as defined in the Plan at the time of termination of
      Employment), then (i) the non-vested portion of the Option shall
      immediately expire on the termination date (ii) the vested portion of
      the Option shall expire to the extent not exercised within three
      (3) months after the date of such termination of Employment. In no
      event may the Option be exercised by anyone after the earlier of
      (A) the expiration of the Option Period or (B) three
      (3) months after termination of
Employment.

            

    

    

    
      	
              (c)
        

            	
              Death or
      Disability. If Optionee’s Employment with the Company is terminated
      by death or Disability, then the vesting of the Option will be accelerated
      and the entire Option shall be 100% vested on the date of termination of
      Employment and shall expire 365 calendar days after the date of such
      termination of Employment to the extent not exercised by Optionee or, in
      the case of death, by the person or persons to whom Optionee’s rights
      under the Option have passed by will or by the laws of descent and
      distribution or, in the case of Disability, by Optionee’s legal
      representative. In no event may the Option be exercised by anyone after
      the earlier of (i) the expiration of the Option Period or (ii) 365
      days after Optionee’s death or termination of Employment due to
      Disability.

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
      	
              (d)
        

            	
               Retirement. In
      the event of termination due to retirement, the vested portion of the
      Option shall expire on the earlier of (i) the Option Period or
      (ii) three (3) months after the date of retirement, and the unvested
      portion of the Option shall expire.

            

    

    

    
      	
              (e)
        

            	
               Change of
      Control. In the event of a “Change in Control” of the Company (as
      defined below) the vesting of the Option will be accelerated and the
      entire Option shall be 100% vested as of the date immediately preceding a
      Change in Control and the Option may be accelerated and the Option shall
      otherwise be affected as provided in the Plan at such time. For the
      purposes of this Agreement, a “Change in Control” of the Company shall
      include any event as defined in the Plan, and the Board has determined
      that pursuant to Section 6.7(f) of the Plan, a “Change in Control” of
      the Company shall also include any other event that constitutes a “Change
      in Control” of the Company as defined in the Optionee’s Termination
      Agreement with the Company.

            

    

    

    
      	
              10.  

            	
              Qualification
      as an Incentive Stock Option. The Optionee
      understands that the Option is intended to qualify as an “incentive stock
      option” within the meaning of Section 422 of the Code. The Optionee
      must meet certain holding periods under Section 422(a) of the Code to
      obtain the federal income tax treatment applicable to the exercise of
      incentive stock options and the disposition of Shares acquired thereby.
      The Optionee further understands that the exercise price of Shares subject
      to this Option has been set by the Board of Directors or the Compensation
      Committee at a price that the Board of Directors or the Compensation
      Committee determined to be not less than 100% (or, if the Optionee, at the
      Date of Grant, owned more than 10% of the total combined voting power of
      the Company’s outstanding voting securities, 110%) of the Fair Market
      Value, as determined in accordance with the Plan, of a share of Common
      Stock on the Date of Grant. The Optionee further understands and agrees,
      however, that neither the Company nor the Board of Directors or the
      Compensation Committee shall be liable or responsible for any additional
      tax liability incurred by the Optionee in the event that the Internal
      Revenue Service for any reason determines that this Option does not
      qualify as an “incentive stock option” within the meaning of the
      Code.

            

    

    

    
      	
              11.  

            	
              Independent
      Legal and Tax Advice. Optionee acknowledges that the Company has
      advised Optionee to obtain independent legal and tax advice regarding the
      grant and exercise of the Option and the disposition of any Shares
      acquired thereby.

            

    

    

    
      	
              12.  

            	
              Reorganization
      of Company. The existence of the Option shall not affect in any way
      the right or power of the Company or its stockholders to make or authorize
      any or all adjustments, recapitalizations, reorganizations or other
      changes in Company’s capital structure or its business, or any merger or
      consolidation of the Company, or any issue of bonds, debentures, preferred
      or prior preference stock ahead of or affecting the Shares or the rights
      thereof, or the dissolution or liquidation of the Company, or any sale or
      transfer of all or any part of its assets or business, or any other
      corporate act or proceeding, whether of a similar character or
      otherwise.

            

    

    

    
      	
              13.  

            	
              Adjustment
      of Shares. In the event of stock dividends, spin-offs of assets or
      other extraordinary dividends, stock splits, combinations of shares,
      recapitalizations, mergers, consolidations, reorganizations, liquidations,
      issuances of rights or warrants and similar transactions or events
      involving Company, appropriate adjustments shall be made to the terms and
      provisions of this Option as provided in the
  Plan.

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	
              14.  

            	
              No
      Rights in Shares. Optionee shall have no rights as a stockholder in
      respect of the Shares until the Optionee becomes the record holder of such
      Shares.

            

    

    

    
      	
              15.  

            	
              Investment
      Representation. Optionee will enter into such written
      representations, warranties and agreements as Company may reasonably
      request in order to comply with any federal or state securities law.
      Moreover, any stock certificate for any Shares issued to Optionee
      hereunder may contain a legend restricting their transferability as
      determined by the Company in its discretion. Optionee agrees that Company
      shall not be obligated to take any affirmative action in order to cause
      the issuance or transfer of Shares hereunder to comply with any law, rule
      or regulation that applies to the Shares subject to the
      Option.

            

    

    

    
      	
              16.  

            	
              No
      Guarantee of Employment. The Option shall not
      confer upon Optionee any right to continued Employment with the Company or
      any subsidiary or affiliate
thereof.

            

    

    

    
      	
              17.  

            	
              Withholding
      of Taxes. This Option is subject to and the Company shall have the
      right to take any action as may be necessary or appropriate to satisfy any
      federal, state, or local tax withholding obligations, including at the
      Board of Directors or the Compensation Committee’s discretion, to make
      deductions from the number of Shares otherwise deliverable upon exercise
      of the Option in an amount sufficient to satisfy withholding of any
      federal, state or local taxes required by
law.

            

    

    

    
      	
              18.  

            	
              General.

            

    

    

    
      	
              (a)
        

            	
              Notices. All
      notices under this Agreement shall be mailed or delivered by hand to the
      parties at their respective addresses set forth beneath their signatures
      below or at such other address as may be designated in writing by either
      of the parties to one another. Notices shall be effective upon
      receipt.

            

    

    

    
      	
              (b)
        

            	
              Shares
      Reserved. Company shall at all times during the Option Period
      reserve and keep available under the Plan such number of Shares as shall
      be sufficient to satisfy the requirements of this
  Option.

            

    

    

    
      	
              (c)
        

            	
              Nontransferability of
      Option. The Option granted pursuant to this Agreement is not
      transferable other than by will, the laws of descent and distribution or
      by a qualified domestic relations order (as defined in Section 414(p) of
      the Internal Revenue Code). The Option will be exercisable during
      Optionee’s lifetime only by Optionee or by Optionee’s legal representative
      in the event of Optionee’s Disability. No right or benefit hereunder shall
      in any manner be liable for or subject to any debts, contracts,
      liabilities, obligations or torts of
Optionee.

            

    

    

    
      	
              (d)
        

            	
               Amendment and
      Termination. No amendment, modification or termination of the
      Option or this Agreement shall be made at any time without the written
      consent of Optionee and Company.

            

    

    

    
      	
              (e)
        

            	
               No Guarantee of Tax
      Consequences. The Company and the Board of Directors or the
      Compensation Committee make no commitment or guarantee that any federal or
      state tax treatment will apply or be available to any person eligible for
      benefits under the Option. The Optionee has been advised and been provided
      the opportunity to obtain independent legal and tax advice regarding the
      grant and exercise of the Option and the disposition of any Shares
      acquired thereby.

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      	
              (f)
        

            	
               Severability.
      In the event that any provision of this Agreement shall be held illegal,
      invalid, or unenforceable for any reason, such provision shall be fully
      severable, but shall not affect the remaining provisions of the Agreement,
      and the Agreement shall be construed and enforced as if the illegal,
      invalid, or unenforceable provision had not been included
      herein.

            

    

    

    
      	
              (g)  

            	
              Supersedes Prior
      Agreements. This Agreement shall supersede and replace all prior
      agreements and understandings, oral or written, between the Company and
      the Optionee regarding the grant of the Options covered
      hereby.

            

    

    

    
      	
              (h)  

            	
               Governing Law.
      The Option shall be construed in accordance with the laws of the State of
      Nevada without regard to its conflict of law provisions, to the extent
      federal law does not supersede and preempt Nevada
  law.

            

    

    
      

      
        	
                19.  

              	
                Definitions and Other Terms.
      The following capitalized terms shall
      have those meanings set forth opposite
  them:

              

      

      
(a)
Optionee: __________________________________________________

    

    

    (b) Type
of Option:                       
Incentive Stock
Option                                        

    

    (c) Date
of Grant: _______________________________________________

    

    (d) Vesting
Start Date: ___________________________________________

    

    (e)
Shares: __________________  shares of the Company’s Common
Stock.

    

    (f)
Option Price: $                                                 
.

    

    (g)
Vesting Schedule: Options for Shares shall vest as follows:

    

    Decided
by resolution of the Board of Directors.

    

    IN WITNESS WHEREOF, the
Company has, as of ____________, 200_, caused this Agreement to be executed on
its behalf by its duly authorized officer, and Optionee has hereunto executed
this Agreement as of the same date.

    

     

    
      	VIVAKOR, INC.	OPTIONEE
	 	 
	 	 
	By:
      ___________________________	______________________________
	Title:
      __________________________	 
	 	 
	Address for Notices
      to the Company:	Address for Notices
      to Optionee:
	 	 
	2590 Holiday Rd.,
      Suite 100	______________________________
	Coralville, IA 
      52241	______________________________

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

    NOTICE
OF EXERCISE AND COMMON STOCK PURCHASE AGREEMENT

    

    VivaKor,
Inc.

    2590
Holiday Road, Suite 100

    Coralville,
IA  52241

    Attn:  Chief
Financial Officer

    

    
      	
               
      

            	
              Re:

            	
              Exercise
      of Incentive Stock Option

            

    

     

    Dear Sir
or Madam:

    

    Pursuant
to the Incentive Agreement dated _________, 200__  (the “Stock Option Agreement”), I
hereby elect to purchase _____________ shares of the Common Stock of the
Company (“Common Stock”)
at the aggregate exercise price of $____________.  I enclose the
following documents (check all that are applicable):

     

    
      	
              o  

            	
              My
      check in the amount of
$___________.

            

    

     

    
      	
              o  

            	
              Other
      (specify):                                                                                                           .

            

    

     

    The
Common Stock is to be issued and registered in the name(s) of:

     

    ___________________________________

     

    ___________________________________

     

    I understand that
there may be tax consequences as a result of the purchase or disposition of the
Common Stock, I have consulted with any tax consultant I desired to consult, and
I am not relying on the Company for any tax advice. I understand that my
exercise is governed by my Incentive Agreement and agree to abide by and be
bound by its terms and conditions. I represent that the Common Stock is being
acquired solely for my own account and not as a nominee for any other party, or
for investment, and that I will not offer, sell or otherwise dispose of any such
Common Stock except under circumstances that will not result in a violation of
the Securities Act of 1933, as amended, or the securities laws of any
state.

     

    Dated:  ___________________,
200_.

     

    ________________________________________

    (Signature)

     

    ________________________________________
(Please
Print Name)

     

    ________________________________________

    ________________________________________
(Address)

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    2008
PLAN

    

    (ATTACH
HERE)

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    8

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