Document:

Exhibit 10.10

[Fox Cable
Networks Letterhead]*

January 15, 2007

International Fight
League, Inc.

424 West 33rd Street, Suite 650

New York, NY  10001

Attn:  Gareb Shamus, Chairman & CEO

Re:          Letter of Intent

Ladies and Gentlemen:

This binding
letter of intent between International Fight League, Inc., a Delaware
corporation (“IFL”),
and Fox Cable Networks, Inc. (“Fox”) and MyNetworkTV, Inc., a Delaware corporation (“MNTV” and, together with Fox, the “Fox Entities”), including Exhibit A
hereto, sets forth certain terms on and conditions under which the Fox Entities
and IFL propose to create, promote and distribute IFL mixed martial arts (“MMA”) content for
television and other media.

Promptly following
execution of this letter of intent by IFL (the “Commencement Date”), the Fox Entities
and IFL shall commence good faith negotiations of definitive agreements in
respect of the transactions contemplated hereby (the “Definitive Agreements”),
including without limitation a telecast rights agreement, broadcast rights
agreement, warrant agreement, master services agreement and limited liability
company operating agreement.  The
Definitive Agreements shall contain provisions consistent with the terms set
forth in Exhibit A to this letter of intent, including customary
representations and warranties (including the representations and warranties of
IFL set forth in the Securities Purchase Agreement dated as of December 22,
2006, by and among IFL and each purchaser identified therein (the “2006 SPA”)), covenants and
indemnities.  The Fox Entities and IFL
shall continue to negotiate the Definitive Agreements in good faith until the
first to occur (the date of such occurrence, the “Expiration Date”) of (a) the full
execution and delivery of the Definitive Agreements, (b) the mutual consent of
the parties to terminate negotiations, (c) termination of this letter of intent
by Fox pursuant to the immediately following paragraph, and (d) March 15, 2007.  The obligations of the IFL
and the Fox Entities set forth in or arising from this letter of intent are
intended to be binding upon the parties, and each of the parties shall be
entitled to the rights provided to it by such provisions; provided,
however that none of the parties shall be obligated to consummate
the transactions contemplated hereby except pursuant to the Definitive
Agreements.

*  Certain
Confidential Information in this exhibit has been omitted and separately filed
with the Commission.  Confidential
treatment has been requested with respect to the omitted portions.

 

IFL shall give Fox
and its counsel, accountants and other representatives full and prompt access
to IFL’s books of account, contracts and other records, management,
accountants, attorneys and financial advisors and shall promptly provide to Fox
and its representatives all documents and information regarding IFL that Fox or
its representatives may reasonably request so that Fox and its representatives
may investigate any and all aspects of the business, prospects and financial
condition of IFL.  IFL shall use all
reasonable efforts to ensure that the documents and information provided to Fox
and its representatives, as well as all documents and information previously
provided to Fox or any of its representatives, are materially complete and
accurate.  Fox shall not be required to
execute the Definitive Documents and may terminate this letter of intent, if
(a) Fox determines that (i) any of the representations and warranties set
forth in the 2006 SPA was not materially true and correct when given and/or is
not materially true and correct as of the date hereof, as if such
representations and warranties were given as of the date hereof, (ii) any
of the reports or other documents filed or submitted by IFL with the Securities
and Exchange Commission contains any statement that is materially misleading or
omits any statement therein necessary to render the statements made therein not
materially misleading, or (iii) IFL does not have sufficient and
appropriate rights to the assets, intellectual property and other rights to
provide Fox with the full benefits of its rights hereunder and the transactions
contemplated hereby, and (b) Fox delivers notice of termination of this
letter of intent to IFL on or before January 31, 2007.

From the
Commencement Date through the Expiration Date, IFL shall not, and shall cause
its affiliates, representatives and stockholders (collectively with IFL, the “Restricted Persons”)
not to, engage in any discussions or negotiations with any person other than
Fox and its affiliates regarding any telecast or other distribution rights in
respect of IFL regular season events (“Distribution Rights”).  During such period, none of the Restricted
Persons shall (a) provide (or cause any person to provide) to any other person
any non-public information regarding IFL in connection with the potential grant
by IFL of Distribution Rights, (b) deliver (or cause any person to deliver) to
any other person any proposal for consideration of a grant by IFL of Distribution
Rights or (c) otherwise indicate to any person other than Fox and its
affiliates that IFL or any of the Restricted Persons is open to granting
Distribution Rights to any person.  For
purposes of this letter of intent, the term “person” shall include a natural
person, corporation, partnership and any other entity or group.

Fox and IFL are
parties to the Confidentiality Letter dated December 1, 2006 (the “Confidentiality Letter”),
the provisions of which are in full force and effect and remain unchanged by this
letter of intent.  Each of Fox and IFL
acknowledge and agree that the existence and terms of this letter of intent,
including Exhibit A hereto, reflect the fact that discussions or
negotiations concerning the Transaction (as defined in the Confidentiality
Letter), as well as the status thereof and, accordingly, that disclosure of the
existence and/or any terms of this letter of intent is prohibited by the
Confidentiality Letter.

None of the rights
of either party hereunder may be assigned, nor may any of the obligations of
either party hereunder be delegated, without the prior written consent of the
other 

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party; provided, however, that Fox may assign its
rights or delegate its obligations hereunder to any of its affiliates without
the prior written consent of IFL.

This letter of
intent, the rights and obligations of the parties hereto and any claims or
disputes relating hereto shall be governed by and construed and enforced in
accordance with the laws of the State of New York without giving effect to the
conflicts of law principles thereof (other than Section 5-1401 of the New
York General Obligations Law).  Each of
the parties hereto consents to the non-exclusive jurisdiction of the state and
federal courts located in New York County, New York, which courts shall have
jurisdiction to adjudicate all matters arising under or relating to this letter
of intent, the attached Term Sheet and the transactions contemplated hereby and
thereby.

                To confirm that the foregoing,
including Exhibit A hereto, reflects your understanding and agreement,
please sign two copies of this letter of intent and return one to the
undersigned at your earliest convenience.

                We look forward to building a
mutually beneficial and long-term business relationship with the International
Fight League.

	
  

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  /s/ Rita Tuzon

  
	
   

  	
   

  
	
   

  	
  Rita Tuzon

  
	
   

  	
  Executive Vice President and General Counsel

  
	
   

  	
   

  
	
  Accepted and
  agreed as of

  the 15th day of January, 2007:

  	
   

  
	
   

  	
   

  
	
  MyNetworkTV,
  Inc.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Marisa
  Fermin

  	
   

  	
   

  
	
  Name:

  	
  Marisa Fermin

  	
   

  	
   

  
	
  Title:

  	
  signatory

  	
   

  	
   

  
					

 

 3
 

 

	
  

  	
   

  
	
  Accepted and
  agreed as of

  the 15th day of January, 2007:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Gareb Shamus

  	
   

  	
   

  
	
  Name:

  	
  Gareb Shamus

  	
   

  	
   

  
	
  Title:

  	
  CEO

  	
   

  	
   

  
					

 

 4

 

EXHIBIT A

	
  I. FSN Distribution Agreement

  	
  Between Fox Sports Net,
  Inc. (“FSN”) and IFL

  
	
   

  	
   

  
	
  a.
  Distribution Rights

  	
  “Distribution
  Rights” shall include all forms of media distribution, in any
  and all languages, including without limitation standard over-the-air
  television (“Standard Television”) and
  cable/satellite distribution, but excluding radio (terrestrial and
  satellite), home video, online/Internet, broadband and mobile/wireless
  distribution; provided, however, that for
  purposes of this agreement, IPTV shall not be excluded from Distribution
  Rights. FSN shall have the right to sublicense any or all of the Distribution
  Rights within the FSN Exclusive Territory (as defined below) from time to
  time to any affiliate of Fox, in FSN’s sole discretion.

  
	
   

  	
   

  
	
  b. Distribution

  	
  Each year of the Term
  (as defined below), FSN shall retain exclusive Distribution Rights (including
  sublicense rights to any and all Fox affiliates) to no less than eleven (11)
  IFL team events, which events, each year of the Term, shall include all IFL
  regular season and playoff and championship mixed martial arts (“MMA”) matches (each, a “Scheduled Core Event”), within the
  United States, its territories, possessions, commonwealths and military
  installations (the “FSN Exclusive Territory”);
  provided, however, that MyNetworkTV (“MNTV”) shall retain the specific
  Standard Television rights described below in Part II.a. Each
  Scheduled Core Event shall create two (2) one-hour Programs (as defined
  below) (i.e., in 2007, IFL shall deliver twenty-two (22) Programs in
  accordance with Part I.i. below). Each subsequent year of the Term,
  FSN shall retain exclusive Distribution Rights within the FSN Exclusive
  Territory to all Scheduled Core Events consistent in type (i.e., all regular season and playoff MMA matches,
  including all IFL championship event(s)) with those scheduled for the 2007
  IFL season.

  

 

 A-1
 

 

	
  

  	
  Fox (on behalf of all
  Fox affiliates) shall retain an exclusive right of first refusal to acquire
  exclusive Distribution Rights to any additional MMA events controlled and/or
  created by the IFL (e.g., grand
  prix events). Fox and IFL shall negotiate confidentially, exclusively and in
  good faith for a period of fifteen (15) business days in connection with the
  terms and conditions upon which Fox may acquire such exclusive Distribution
  Rights to any such additional IFL event(s). If Fox (on behalf of any Fox
  affiliate) declines to license any such event, IFL shall be free to
  thereafter license Distribution Rights within the FSN Exclusive Territory to
  such event to any other network, channel or programming service on the same
  or more favorable terms to IFL as those offered to Fox in connection with
  such event; provided, however, that Fox
  shall have the right to match any offer made by or to any third party in
  connection with such event which offer is less favorable to IFL than the
  terms offered or otherwise proposed to Fox (“Right
  to Match”). Fox will exercise its Right to Match within ten
  (10) days of Fox’s receipt of written notice of the above-referenced third
  party offer.

  
	
   

  	
   

  
	
   

  	
  Notwithstanding the
  foregoing, in connection with one (1) IFL grand prix event per year of the
  Term (as designated by Fox), Fox’s Right to Match shall extend to any third
  party offer, including any less favorable offer, like offer, and more
  favorable offer made by or to any such third party in connection with such
  event. Any such additional IFL event licensed by Fox (each, an “Additional Event”) shall be
  produced and distributed by Fox, including any Fox-affiliated entity (e.g., FSN, MyNetworkTV), upon terms and conditions to be
  mutually determined by Fox and IFL.

  
	
   

  	
   

  
	
  c. Video
  on Demand (“VOD”)

  	
  During the Term, FSN
  shall retain the exclusive right, within the FSN Exclusive Territory, to
  distribute new and past IFL events via all forms of VOD, including, without
  limitation, subscription VOD (“SVOD”).

  

 

 A-2
 

 

	
  

  	
  During the Term, FSN
  shall retain exclusive VOD/SVOD distribution rights to the Scheduled Core
  Events, including, without limitation, the Programs, and the annual PPV Event
  (as defined below), or any portion thereof, as well as any Shoulder
  Programming and IFL Ancillary Programming (each, as defined below) produced
  by FSN. In addition, Fox shall have access to IFL’s complete
  programming/video library and, in its sole discretion, may redistribute any
  of such programming via VOD/SVOD. During the Initial Term, FSN shall retain
  any and all revenues, as well as any other non-cash consideration, received
  in connection with VOD distribution of the above-described programming.
  During the First Option Period and Second Option Period (each, as defined
  below), if any, FSN and IFL shall negotiate in good faith with respect to
  terms upon which IFL may share in any net cash consideration (net of FSN
  production and distribution costs) received by FSN in connection with VOD
  distribution of any IFL-specific program offering (i.e., any VOD offering
  consisting solely of IFL content and not coupled with any other sports
  content) as negotiated by FSN in good faith; provided, however, that any IFL
  share shall not exceed 20% of net cash consideration received by FSN.

  
	
   

  	
   

  
	
  d.
  Pay-Per-View (“PPV”)

  	
  IFL shall license to
  FSN exclusive PPV rights to one (1) MMA event per year (each, a “PPV Event”), to be mutually-agreed
  upon by FSN and IFL prior to the selection of any IFL-controlled PPV MMA
  event by any other third party rights holder.FSN shall retain exclusive PPV
  distribution rights to each such PPV Event, including exclusive live PPV
  distribution rights as well as the exclusive right to redistribute each such
  PPV Event, and any portion thereof, via any form of Distribution Rights,
  within the FSN Exclusive Territory, for the duration of the Term.FSN shall produce
  the PPV Event telecasts at its sole cost and expense, including, without
  limitation, all 

  

 

 A-3
 

 

	
  

  	
  venue and talent costs.
  FSN shall retain all revenues in connection with the distribution of the PPV
  Event telecasts.

  
	
   

  	
   

  
	
  e. International
  Rights

  	
  During the Term, Fox
  (on behalf of all Fox affiliates) shall retain an exclusive right of first
  refusal to acquire exclusive Distribution Rights (excluding standard
  over-the-air distribution) in Latin America and the Middle East (the “International Rights”). In the
  event that IFL determines to offer International Rights, Fox and IFL shall
  negotiate confidentially, exclusively and in good faith for a period of
  fifteen (15) business days in connection with the terms and conditions upon
  which Fox may acquire the International Rights.

  
	
   

  	
   

  
	
   

  	
  If Fox declines to
  license the International Rights or Fox and IFL cannot otherwise negotiate
  mutually agreeable terms for the International Rights, IFL shall be free
  thereafter to license International Rights to any other person or entity on
  the same or more favorable terms to IFL as those offered to Fox; provided,
  however, that Fox shall have the right to match any offer made by or to any
  third party in connection with any International Rights, if the offer is less
  favorable to IFL than the terms offered or otherwise proposed to Fox (“International Right to Match”).
  Fox will exercise its International Right to Match within ten (10) days of
  Fox’s receipt of written notice of the above-referenced offer.

  
	
   

  	
   

  
	
  f.
  Scheduling

  	
  FSN shall initially
  clear each Program on Fridays at 11:00 p.m. local time, or within any more
  favorable time slot as may be mutually agreed upon by and between FSN and
  IFL, subject to time slot availability, clearance opportunities, and other FSN
  contractual obligations. FSN shall use commercially reasonable efforts to
  clear each Program a minimum of two (2) times (including the above-referenced
  initial Friday telecast) as part of the FSN programming service, with
  clearance in a 

  
	
   

  	
   

  

 

 A-4
 

 

	
  

  	
  minimum of 50 million
  homes, subject to FSN’s standard distribution terms and conditions. In the
  event FSN is unable to clear the Programs on the FSN programming service, FSN
  shall provide like or more favorable distribution in connection with such
  Program(s) on a Fox-affiliated network, channel or programming service.
  During the Term, FSN shall retain the exclusive right, but no obligation, to
  re-telecast, within the FSN Exclusive Territory, any Program, or any portion
  thereof, in accordance with the Distribution Rights set forth above.

  
	
   

  	
   

  
	
   

  	
  FSN shall provide
  on-air promotion for the Programs in a manner generally consistent with FSN’s
  promotion of other MMA programming on the FSN programming service.

  
	
   

  	
   

  
	
  g. Consideration
  to IFL

  	
  During the Initial
  Term, in connection with each full Program telecast, including any
  re-purposing, but excluding any Standard Television distribution of such
  Program, FSN shall provide IFL with [*] of promotional/advertising inventory
  and a mutually agreeable number of billboards for the promotion of products
  and services of advertisers solicited by IFL, or for promotion of the IFL
  and/or IFL initiatives (collectively, “IFL Inventory”),
  subject to FSN’s standard commercial/promotional guidelines and regulations.
  During the First Option Period, if any, total IFL Inventory shall increase to
  [*], and during the Second Option Period, if any, total IFL Inventory shall
  increase to [*]. IFL Inventory may not promote or otherwise reference any
  other network, channel or programming service and may not compete with any
  exclusive FSN in-Program sponsors. IFL shall not allocate Program exclusivity
  (e.g., category exclusivity to any automobile advertiser, etc.) to any IFL
  advertiser or sponsor. For each replay of any Program that 

  

*  Confidential Information in this exhibit has
been omitted and separately filed with the Commission.  Confidential treatment has been requested
with respect to the omitted portions.

 A-5
 

 

	
  

  	
  is edited or otherwise
  condensed to a shorter duration, the number of: 30 units and billboards
  allocated to IFL shall be reduced proportionately.

  
	
   

  	
   

  
	
  h. Term

  	
  The initial term shall
  extend for three (3) years commencing January 1, 2007 (the “Initial Term”).  Thereafter, Fox shall retain two (2)
  consecutive, unilateral three (3)-year options to extend the Initial Term,
  excluding rights set forth in Part I.e. hereof (Additional
  International Networks) (each, an “Option”).  The three (3)-year period commencing
  January 1, 2010 and ending December 31, 2012 shall be referred to herein
  as the “First Option Period” and
  the three (3)-year period commencing January 1, 2013 and ending December 31,
  2015 shall be referred to herein as the “Second Option Period.”  Fox shall provide written notice to IFL of
  its intent to exercise its Option rights at least 120 days  prior to the end of the Initial Term and
  the First Option Period, if any, and as the case may be, subject to Fox’s
  right to terminate this agreement in the event the quality and/or nature of
  the IFL and the Scheduled Core Events is materially different from that of
  the IFL and its events during the 2006 IFL season.  Fox’s rights and obligations to distribute
  IFL programming, including the Programs, Shoulder Programming, IFL Ancillary,
  and the PPV Events, during the First Option Period and the Second Option
  Period, in each case, if any, shall be in accordance with the terms and
  conditions set forth herein.

  
	
   

  	
   

  
	
   

  	
  For purposes of this
  agreement, “Term” shall refer to the
  Initial Term as extended by the First Option Period and Second Option Period,
  as applicable.

  
	
   

  	
   

  
	
   

  	
  In the event Fox does
  not exercise an Option in accordance with the foregoing terms, Fox shall
  retain a first negotiation right with respect to IFL programming consistent
  with that described herein, and in accordance therewith, Fox and IFL shall
  negotiate exclusively, 

  

 

 A-6
 

 

	
  

  	
  confidentially and in
  good faith for a period of thirty (30) days in connection with terms and
  conditions upon which Fox may acquire rights to distribute IFL-related
  programming after the expiration of the Initial Term or the First Option
  Period, as the case may be.  Fox shall
  retain a first negotiation right (for a period of 30 days), beginning no
  later than 90 days prior to the end of the Second Option Period, as
  applicable.

  
	
   

  	
   

  
	
  i.
  Programming/Production

  	
   

  
	
   

  	
   

  
	
  1.
  Scheduled Core Events

  	
  During each year of the
  Term, IFL shall provide FSN with two (2) fully-produced, sixty (60) -minute
  (44:21 of broadcast time), English language programs for each Scheduled Core
  Event, representing a season of Scheduled Core Events (each, a
  “Program”).  IFL shall deliver
  twenty-two (22) Programs in connection with the 2007 IFL season.  IFL shall provide each Program, inclusive
  of IFL Inventory, to FSN for approval in accordance with FSN’s standard
  programming guidelines and regulations no later than four (4) days prior to
  the initial scheduled telecast, provided that the Programs shall be
  consistent with those produced by IFL and distributed by FSN during the 2006
  IFL season.  FSN shall retain the right
  to modify, condense or otherwise re-purpose any Program (e.g., highlight
  programming, “best of” programming, etc.) for distribution in accordance with
  the terms set forth above.  Any cost or
  expense incurred in connection with such Program modification or re-purposing
  shall be assumed by FSN.

  
	
   

  	
   

  
	
   

  	
  In connection with each
  Program, IFL shall provide FSN with any and additional interviews, B-roll
  footage and video, as reasonably requested by FSN, which materials may be
  distributed by FSN in accordance with the terms and conditions set forth
  above (i.e., Distribution Rights and VOD/SVOD within the FSN Exclusive
  Territory).

  

 

 

 A-7

 

	
  2. Shoulder/IFL-Related Programming

  	
  During the Term, FSN
  shall retain the exclusive right, exercisable in its sole discretion, to
  produce and distribute, and/or cause the distribution of, in accordance with
  the Distribution Rights set forth above, and within the FSN Exclusive
  Territory, shoulder programming in connection with each Program and each PPV
  Event (e.g., pre-event programming,
  post-event highlight programming; collectively, “Shoulder
  Programming”). In addition, FSN shall retain the exclusive
  right during the Term, exercisable in its sole discretion, to produce and
  distribute, and/or cause the distribution of, within the FSN Exclusive
  Territory, additional IFL-related programming (e.g.,
  magazine shows, fighter profiles, press conference programming, etc.), other
  than programming produced in connection with additional IFL events (other
  than the Scheduled Core Events) not licensed by Fox in accordance with the
  terms set forth above (collectively, “IFL Ancillary
  Programming”) and other than alternative programming (i.e., reality, game show programming) produced by IFL. IFL
  shall provide Fox with the existing IFL video library, including footage of
  past IFL events and any other IFL-related programming, and reasonable access
  to IFL fighters and facilities to enable Fox to produce the above-described
  Shoulder Programming and IFL Ancillary Programming.FSN shall retain exclusive
  Distribution Rights to all Shoulder Programming and IFL Ancillary Programming
  produced by FSN during the Term; provided, however,
  that FSN shall make all such Shoulder Programming and IFL Ancillary
  Programming available to the LLC (as defined below) in exchange for a
  mutually agreeable production contribution to be applied by FSN against the
  production costs incurred in connection with such Shoulder Programming and
  IFL Ancillary Programming, as applicable; provided further,
  however, that IFL shall retain no distribution rights (other than
  as set forth above with respect to the LLC) to the Shoulder Programming and
  the IFL Ancillary 

  

 

 A-8
 

 

	
  

  	
  Programming at any
  time. FSN shall not enter into any contractual arrangement or agreement with
  any athlete or coach under contract to IFL without IFL’s prior consent, such
  consent not to be unreasonably withheld or delayed. The Shoulder Programming
  and IFL Ancillary Programming shall not unreasonably portray IFL in a
  negative light. 

  
	
   

  	
   

  
	
   

  	
  Notwithstanding the
  exclusive Distribution Rights granted to FSN as set forth herein, IFL shall
  be permitted to utilize up to eight (8) minutes of video content per Program
  in connection with any alternative programming (i.e., reality, game show
  programming, etc.).

  
	
   

  	
   

  
	
  3. Production
  Consulting

  	
  FSN shall provide
  production consulting services to IFL with respect to the Programs, as
  reasonably requested by IFL, provided that
  FSN shall not be responsible for any clearance or other licenses in
  connection with the Programs.

  
	
   

  	
   

  
	
  4. Production
  Costs

  	
  During the Initial
  Term, IFL is solely responsible for all costs and expenses related to the
  Scheduled Core Events and the production of each Program, including, without
  limitation, all clearances and licenses and all associated union/guild fees
  (collectively, “Program Production Costs”).
  During the First Option Period, if any, IFL shall remain solely responsible
  for all costs and expenses related to the Scheduled Core Events, provided that, in connection with each Program, FSN shall
  contribute [*] against the Program Production Costs incurred by IFL. During
  the Second Option Period, if any, IFL shall remain solely responsible for all
  costs and expenses related to the Scheduled Core Events, provided
  that, in connection with each Program, FSN shall contribute [*] against the
  Program Production Costs incurred by IFL. In connection with the First Option
  Period and Second Option Period, IFL shall provide FSN with a break-down of 

  

*  Confidential Information in this exhibit has
been omitted and separately filed with the Commission.  Confidential treatment has been requested
with respect to the omitted portions.

 A-9
 

 

	
  

  	
  all Program Production
  Costs, as reasonably requested by FSN.

  
	
   

  	
   

  
	
   

  	
  FSN shall bear all
  costs and expenses related to the production of any Shoulder Programming and
  any IFL Ancillary Programming, including all clearances and licenses for any
  video or audio materials not provided by IFL.

  
	
   

  	
   

  
	
   

  	
  FSN shall bear all
  incremental production expenses for the creation of any VOD content (in
  addition to the Programs).

  
	
   

  	
   

  
	
   

  	
  FSN shall bear all
  costs and expenses related to production of any non-English language telecast
  of the Scheduled Core Events, the PPV Events, the Shoulder Programming and
  any IFL Ancillary Programming.

  
	
   

  	
   

  
	
   

  	
  In the event FSN
  requests that the Programs, or any of them, be delivered in a high-definition
  format, FSN shall assume any additional costs incurred by IFL in connection
  with such request.

  
	
   

  	
   

  
	
  j. Signage

  	
  Fox shall receive (on
  behalf of FSN and all other Fox affiliates, in Fox’s discretion) prominent
  event signage at all IFL events, consistent with signage received by Fox/FSN
  during the 2006 IFL season. All hard costs associated with such signage shall
  be borne by FSN. In connection with the Scheduled Core Events, any Additional
  Events and the PPV Events, IFL shall not provide camera-visible signage to
  any other network, channel or programming service, other than FSN or a
  Fox-designated network, channel or programming service.

  
	
   

  	
   

  
	
  II.
  MyNetworkTV Distribution Agreement

  	
  Between MyNetworkTV (“MNTV”) and IFL

  
	
   

  	
   

  
	
  a. Distribution

  	
  Each year of the MNTV
  Term (as defined below), MNTV shall retain exclusive Distribution Rights
  (including sublicense rights to FSN) to the MNTV Programs (as defined below)
  within the United States, its territories, possessions, commonwealths and
  military

  

 

 A-10
 

 

	
  

  	
  installations (the “MNTV Exclusive Territory”).
  Subject to customary network cutbacks and cancellation rights, MNTV hereby
  orders 22 MNTV Programs.

  
	
   

  	
   

  
	
  b. Scheduling

  	
  MNTV shall coordinate
  with FSN to ensure that the telecast of the MNTV Program does not conflict
  with FSN’s telecast of the Programs.

  
	
   

  	
   

  
	
  c. Consideration
  to IFL

  	
  During the Initial MNTV
  Term (as defined below), MNTV shall pay IFL $50,000 for the initial telecast
  of each MNTV Program telecast on MNTV and, if MNTV repeats such MNTV Program,
  $20,000 for the second telecast of such MNTV Program. During the First MNTV
  Option Period (as defined below), if any, MNTV shall pay IFL [*] for the
  initial telecast of each MNTV Program telecast on MNTV and, if MNTV repeats
  such MNTV Program, [*] for the second telecast of such MNTV Program. During
  the Second MNTV Option Period (as defined below), if any, MNTV shall pay IFL
  [*] for the initial telecast of each MNTV Program telecast on MNTV and, if
  MNTV repeats such MNTV Program, [*] for the second telecast of such MNTV
  Program.

  
	
   

  	
   

  
	
   

  	
  In addition to such
  cash payments, during the Term, MNTV shall provide IFL, during each telecast
  of the MNTV Programs, [*] of promotional/advertising inventory and a mutually
  agreeable number of promotional elements in each full MNTV Program telecast
  (collectively, “MNTV IFL Inventory”) for
  the promotion of products and services of advertisers solicited by IFL, or
  for promotion of the IFL and/or IFL initiatives, subject to MNTV’s standard
  commercial/promotional guidelines and regulations. Unless otherwise agreed by
  MNTV, MNTV IFL Inventory may not promote or otherwise reference any other
  network, channel or programming service and

  

*  Confidential Information in this exhibit has
been omitted and separately filed with the Commission.  Confidential treatment has been requested
with respect to the omitted portions.

 A-11
 

 

	
  

  	
  may not compete with
  any exclusive MNTV in-program sponsors. For each replay of any MNTV Program that
  is edited or otherwise condensed to a shorter duration, the number of :30
  units and promotional elements allocated to IFL shall be reduced
  proportionately. In the event that MNTV does not telecast any MNTV Program
  timely delivered to MNTV by IFL, MNTV will make available to IFL [*] units of
  promotional/advertising time during a reasonably equivalent time slot, for
  the MNTV IFL Inventory that would have been inserted in each such MNTV
  Program.

  
	
   

  	
   

  
	
  d. Term

  	
  The initial term shall
  extend for one (1) year commencing with the initial telecast by MNTV of the
  first MNTV Program during 2007 (the “Initial MNTV Term”).
  Thereafter, MNTV shall retain two (2) consecutive, unilateral one (1)-year
  options (together, the “MNTV Options”)
  to extend the MNTV Initial Term for one year each (the “First
  MNTV Option Period” and the “Second
  MNTV Option Period” respectively); provided
  that the MNTV Option in respect of the Second MNTV Option Period shall
  terminate, if MNTV does not exercise the MNTV Option in respect of the First MNTV
  Option Period.

  
	
   

  	
   

  
	
   

  	
  MNTV shall provide
  written notice to IFL of its intent to exercise its MNTV Option rights at
  least 90 days prior to the end of the then current term, provided that MNTV
  shall have the right to terminate the agreement earlier in the event the
  quality and/or nature of the IFL and the Scheduled Core Events is materially
  different from that of the IFL and its events during the 2006 IFL season.

  
	
   

  	
   

  
	
   

  	
  For purposes of this
  agreement, “MNTV Term” shall refer to
  the Initial Term as extended by the First Option Period and

  

*  Confidential Information in this exhibit has
been omitted and separately filed with the Commission.  Confidential treatment has been requested
with respect to the omitted portions.

 A-12
 

 

	
  

  	
  Second Option Period,
  as applicable.

  
	
   

  	
   

  
	
   

  	
  Provided that FSN has
  exercised its Option in respect of the First Option Period, or is in the
  process of good faith negotiations with IFL in respect of the First Option
  Period, beginning no later than 90 days prior to the scheduled termination of
  the Term, MNTV shall retain a first negotiation right with respect to IFL
  programming consistent with that described herein, and in accordance
  therewith, MNTV and IFL shall negotiate exclusively, confidentially and in
  good faith for a period of thirty (30) days in connection with terms and
  conditions upon which MNTV may acquire rights to distribute IFL-related
  programming after the expiration of the Term (“Extended
  Distribution Rights”).

  
	
   

  	
   

  
	
   

  	
  If MNTV declines to
  license the Extended Distribution Rights or Fox and IFL cannot otherwise
  negotiate mutually agreeable terms for the Extended Distribution Rights, IFL
  shall be free thereafter to license Extended Distribution Rights to any other
  person or entity on the same or more favorable terms to IFL as those offered
  to MNTV; provided, however, that MNTV shall have the right to match any offer
  made by or to any third party in connection with any Extended Distribution
  Rights, if the offer is less favorable to IFL than the terms offered or
  otherwise proposed to MNTV (“MNTV Right to Match”).
  MNTV will exercise its MNTV Right to Match within ten (10) days of MNTV’s
  receipt of written notice of the above-referenced offer.

  
	
   

  	
   

  
	
  e. Programming/Production

  	
   

  
	
   

  	
   

  
	
  1. MNTV
  Programs

  	
  During each year of the
  Term, IFL shall provide MNTV with two (2) fully-produced, one hundred twenty
  (120)-minute (pursuant to MNTV format), English language programs for each
  Scheduled Core Event, representing a season of Scheduled Core Events (each, a
  “MNTV Program”). IFL shall
  re-purpose/edit each Program produced for FSN and produce

  

 

 A-13
 

 

	
  

  	
  an additional one (1)
  hour of ancillary/shoulder programming per show to create each MNTV Program.
  IFL shall provide each MNTV Program, inclusive of MNTV IFL Inventory, to MNTV
  for approval in accordance with MNTV’s standard programming guidelines and
  regulations and MNTV customary delivery requirements. 

  
	
   

  	
   

  
	
   

  	
  MNTV shall license its
  rights in the MNTV Program to FSN.

  
	
   

  	
   

  
	
  2. Production
  Costs

  	
  IFL is solely
  responsible for all costs and expenses related to the Scheduled Core Events
  and the production of each MNTV Program, including, without limitation, all
  clearances and licenses.

  
	
   

  	
   

  
	
  f. Customary
  Provisions

  	
  Customary MNTV provisions
  to apply, including network approvals, insurance and indemnification
  requirements.

  
	
   

  	
   

  
	
  III.
  Digital Rights

  	
   

  
	
   

  	
   

  
	
  a. Acquisition
  of Digital Rights

  	
  Fox (or its designated
  affiliate, the “Fox JV Entity”) shall pay
  IFL (or the IFL affiliate that owns the Digital Rights, as defined below, the
  “IFL JV Entity”) $6 million for a
  51% undivided interest in all digital rights to IFL content in perpetuity,
  whether now existing or hereafter developed (“Digital
  Rights”). Digital Rights shall include the right to distribute
  IFL content in any language, on a live or delayed basis, via any digital
  platform now existing or hereafter developed, including online/Internet,
  broadband and mobile/wireless, exclusive of VOD/SVOD, PPV distribution,
  on-line merchandising, and radio (terrestrial or satellite).

  
	
   

  	
   

  
	
   

  	
  In connection
  therewith, IFL shall issue to Fox (a) Four Million Eight Hundred Thousand
  (4,800,000) shares of common stock of IFL (“Common
  Shares”) and (b) a warrant to purchase One Million Five Hundred
  Thousand Shares (1,500,000) shares of common stock of IFL at $1.25 per share.
  The warrant shall be

  

 

 A-14
 

 

	
  

  	
  exercisable for five
  years, in Fox’s discretion. The Common Shares and the shares of common stock
  issued upon exercise of the warrant shall be subject to demand and piggyback
  registration rights, subject to customary cutbacks and deferrals and subject
  to additional limitations on the demand registration rights during the first
  12 months following the issuance of the Common Shares.

  
	
   

  	
   

  
	
   

  	
  So long as Fox
  (together with its affiliates) owns at least 4,000,000 Common Shares, Fox
  shall have the right to approve any issuance of securities (other than
  non-convertible debt securities) by IFL to any entity set forth on Schedule
  1 hereto (each, a “Specified Person”)
  (which schedule shall be subject to amendment by Fox on or about January 15,
  2012 and each five year anniversary thereof, to include additional
  competitors of Fox), if such issuance would result in a Specified Person
  owning and/or having the right to acquire (whether absolute or conditional)
  more than 2,000,000 shares of common stock of IFL.

  
	
   

  	
   

  
	
   

  	
  Over the course of the
  45 days after execution of the letter of intent, Fox and IFL shall work
  together in good faith to achieve a mutually agreeable tax structure (which
  will include without limitation Fox considering Fox making a direct
  investment in IFL) for the Fox JV Entity’s acquisition of the Digital Rights
  and the issuance to Fox of the Common Shares and warrants described above. If
  after such cooperation, a mutually more beneficial tax structure is agreed
  upon by Fox and IFL, then the structure described above shall be replaced
  with such agreed upon structure.

  
	
   

  	
   

  
	
  b. Creation
  of Joint Venture

  	
  The Fox JV Entity and
  the IFL JV Entity shall create a joint venture in the form of a limited
  liability company (the “LLC”) for
  the distribution of the Digital Rights.

  
	
   

  	
   

  
	
   

  	
  The IFL JV Entity shall
  contribute to the LLC its 49% interest in the Digital Rights, and the Fox JV
  Entity shall contribute to the LLC its 

  

 

 A-15
 

 

	
  

  	
  51% interest in the
  Digital Rights, in exchange for proportionate membership interests in the
  LLC.

  
	
   

  	
   

  
	
   

  	
  Fox shall fund the cash
  requirements of the LLC, as established in the initial 3-year business plan
  approved by the Fox JV Entity and the IFL JV Entity upon formation of the LLC
  (the “Initial Plan”) and any
  subsequent budgets approved by a majority of the Board of Directors. All
  contributions of such funding shall be made in the form of debt (“Funding Notes”).

  
	
   

  	
   

  
	
   

  	
  Sales, assignments and
  other transfers of the members’ respective interests in the LLC shall be
  subject to rights of first negotiation, rights of first refusal and
  restricted entity lists, to be set forth in the LLC operating agreement.

  
	
   

  	
   

  
	
  c. Management
  and Governance of the LLC

  	
  The Board of Directors
  shall consist of 2 directors appointed by Fox and 1 director appointed by the
  IFL JV Entity. Initially, the IFL JV Entity-designated director shall be
  Gareb Shamus, who shall be the initial Chairman of the Board.

  
	
   

  	
   

  
	
   

  	
  The day-to-day
  operations of the LLC shall be managed by a general manager (the “GM”) who
  shall be an employee of the LLC and report to the Board of Directors. All
  decisions in respect of the GM, including hiring, retention and terms of
  employment shall be determined by a majority of the Board.

  
	
   

  	
   

  
	
   

  	
  Fox shall provide all
  operational services to the LLC for the duration of the LLC, subject to Fox’s
  right to terminate the provision of any or all of such services on 90 days’
  notice, in exchange for a monthly fee to be negotiated in good faith by Fox
  and IFL and set forth in the Definitive Documents, plus allocations of Fox’s
  actual costs.

  
	
   

  	
   

  
	
   

  	
  Each of the Fox JV
  Entity and the IFL JV Entity shall have customary approval rights in respect
  of major decisions of the LLC affecting 

  

 

 A-16
 

 

	
  

  	
  the members in such
  capacity (e.g., admission of new members, mergers, acquisitions and business
  combinations). The members’ approval rights shall be structured to enable
  News Corporation, as a parent of Fox, to consolidate the financial results of
  the LLC in News Corporation’s consolidated financial statements in accordance
  with GAAP.

  
	
   

  	
   

  
	
   

  	
  In the event that no
  agreement to continue to televise IFL events is consummated between Fox (or
  any Fox-affiliated entity) and the IFL within six (6) months of the
  expiration or termination of the FSN distribution agreement, then IFL shall
  have the right to purchase all, but not less than all, of Fox’s membership
  interest in the LLC for fair market value.

  
	
   

  	
   

  
	
  c. Profits,
  Losses and Tax Items

  	
  Profits, losses and tax
  items to be allocated in accordance with membership interests (51% to the Fox
  JV Entity, 49% to the IFL JV Entity). No distributions of profits shall be
  made to the members at any time that any Funding Notes are outstanding.

  

 

 A-17

 

 S-1Exhibit 10.1

    
      

    

    
      EXHIBIT
        10.1

      

      SHEARSON
        FINANCIAL NETWORK, INC.

      2007
        STOCK COMPENSATION PLAN

      

      

      1.
        Purposes 

      

      This
        2007
        Stock Compensation Plan (the "Plan") is intended to attract and retain the
        best
        available personnel for positions with Shearson Financial Network, Inc. or
        any
        of its subsidiary corporations (collectively, the "Company"), and to provide
        additional incentive to such employees and others to exert their maximum
        efforts
        toward the success of the Company. The above aims will be effectuated through
        the granting of certain stock options and shares of Common Stock (as defined
        below). Under the Plan, options may be granted which are intended to qualify
        as
        Incentive Stock Options ("ISOs") under Section 422 of the Internal Revenue
        Code
        of 1986 (the "Code") or which are not ("Non-ISOs") intended to qualify as
        Incentive Stock Options thereunder. The term "subsidiary corporation" shall,
        for
        the purposes of the Plan, be defined in the same manner as such term is defined
        in Section 424(f) of the Code and shall include a subsidiary of any subsidiary.
        

      

      2.
        Administration of the Plan 

      

      (a)
        The
        Plan shall be administered by the Board of Directors of the Company (the
        "Board
        of Directors"), as the Board of Directors may be composed from time to time,
        except as provided in subparagraph (b) of this Paragraph 2. The determinations
        of the Board of Directors under the Plan, including without limitation as
        to the
        matters referred to in this Paragraph 2, shall be conclusive. Any determination
        by a majority of the members of the Board of Directors at any meeting, or
        by
        written consent in lieu of a meeting, shall be deemed to have been made by
        the
        whole Board of Directors. Within the limits of the express provisions of
        the
        Plan, the Board of Directors shall have the authority, in its discretion,
        to
        take the following actions under the Plan: 

      

      (i)
        to
        determine the individuals to whom, and the time or times at which, ISOs to
        purchase the Company's shares of Common Stock, par value $.001 per share
        ("Common Shares"), shall be granted, and the number of Common Shares to be
        subject to each ISO, 

      

      (ii)
        to
        determine the individuals to whom, and the time or times at which, Non-ISOs
        to
        purchase the Common Shares, shall be granted, and the number of Common Shares
        to
        be subject to each Non-ISO, 

      

      (iii)
        to
        determine the individuals to whom, and the time or times at which, Common
        Shares
        shall be issued, and the number of Common Shares to be issued (a “Stock
        Award”),

      

      (iv)
        to
        determine the terms and provisions of the respective stock option agreements
        granting ISOs and Non-ISOs and stock award agreements granting Stock Awards
        (which need not be identical), 

      

      (v)
        to
        interpret the Plan, 

      

      (vi)
        to
        prescribe, amend and rescind rules and regulations relating to the Plan,
        and

      

      (vii)
        to
        make all other determinations and take all other actions necessary or advisable
        for the administration of the Plan. In making such determinations, the Board
        of
        Directors may take into account the nature of the services rendered by such
        individuals, their present and potential contributions to the Company's success
        and such other factors as the Board of Directors, in its discretion, shall
        deem
        relevant. An individual to whom an option has been granted under the Plan
        is
        referred to herein as an "Optionee" and an individual to whom a Stock Award
        has
        been granted under the Plan is referred to herein as a “Grantee”. 

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (b)
        Notwithstanding anything to the contrary contained herein, the Board of
        Directors may at any time, or from time to time, appoint a committee (the
        "Committee") of at least two members of the Board of Directors, and delegate
        to
        the Committee the authority of the Board of Directors to administer the Plan.
        Upon such appointment and delegation, the Committee shall have all the powers,
        privileges and duties of the Board of Directors, and shall be substituted
        for
        the Board of Directors, in the administration of the Plan, except that the
        power
        to appoint members of the Committee and to terminate, modify or amend the
        Plan
        shall be retained by the Board of Directors. In the event that any member
        of the
        Board of Directors is at any time not a "disinterested person," as defined
        in
        Rule 16b- 3(c)(3)(i) promulgated pursuant to the Securities Exchange Act
        of
        1934, the Plan shall not be administered by the Board of Directors, and may
        only
        by administered by a Committee, all the members of which are disinterested
        persons, as so defined. The Board of Directors may from time to time appoint
        members of the Committee in substitution for or in addition to members
        previously appointed, may fill vacancies in the Committee and may discharge
        the
        Committee. A majority of the Committee shall constitute a quorum and all
        determinations shall be made by a majority of its members. Any determination
        reduced to writing and signed by a majority of the members shall be fully
        as
        effective as if it had been made by a majority vote at a meeting duly called
        and
        held. Members of the Committee shall not be eligible to participate in this
        Plan. 

      

      3.
        Shares Subject to the Plan 

      

      (a)
        Share
        Reserve. Subject to the provisions of Section 11 relating to adjustments
        upon
        changes in the Common Stock, the Common Stock that may be issued pursuant
        to
        Options and the Common Shares issued pursuant to Stock Awards shall not exceed
        in the aggregate 50,000,000 shares of Common Stock. 

      

      (b)
        Reversion of Shares to the Share Reserve. If any Option shall for any reason
        expire or otherwise terminate, in whole or in part, without having been
        exercised in full, the shares of Common Stock not acquired under such Option
        shall revert to and again become available for issuance under the Plan. If
        the
        Company repurchases unvested shares acquired pursuant to an Option and/or
        Stock
        Award, the shares of Common Stock so repurchased shall revert to and again
        become available for issuance under the Plan. 

      

      (c)
        Source of Shares. The shares of Common Stock subject to the Plan may be unissued
        shares or reacquired shares, bought on the market or otherwise. 

      

      4.
        Eligibility 

      

      (a)
        Subject to subparagraphs (b) and (c) of this Paragraph 4, Options and/or
        Stock
        Awards may be granted to key employees, officers, directors or consultants
        of
        the Company, as determined by the Board of Directors. 

      

      (b)
        An
        ISO may be granted, consistent with the other terms of the Plan, to an
        individual who owns (within the meaning of Sections 422(b)(6) and 424(d)
        of the
        Code), more that ten (10%) percent of the total combined voting power or
        value
        of all classes of stock of the Company or a subsidiary corporation (any such
        person, a "Principal Stockholder") only if, at the time such ISO is granted,
        the
        purchase price of the Common Shares subject to the ISO is an amount which
        equals
        or exceeds one hundred ten percent (110%) of the fair market value of such
        Common Shares, and such ISO by its terms is not exercisable more than five
        (5)
        years after it is granted. 

      

      (c)
        A
        director or an officer of the Company who is not also an employee of the
        Company
        and consultants to the Company shall be eligible to receive Stock Awards
        and/or
        Non-ISOs but shall not be eligible to receive ISOs. 

      

      (d)
        Nothing contained in the Plan shall be construed to limit the right to the
        Board
        of Directors to grant an ISO and Non-ISO concurrently under a single stock
        option agreement so long as each Option is clearly identified as to its status.
        Furthermore, if an Option and/or Stock Award has been granted under the Plan,
        additional Options and/or Stock Awards may be granted from time to time to
        the
        Optionee or Grantee holding such Options and/or Stock Awards, and Options
        and/or
        Stock Awards may be granted from time to time to one or more employees, officers
        or directors who have not previously been granted Options and/or Stock Awards.
        

      

      (e)
        To
        the extent that the grant of an Option results in the aggregate fair market
        value (determined at the time of grant) of the Common Shares (or other capital
        stock of the Company or any subsidiary) with respect to which Incentive Stock
        Options are exercisable for the first time by an Optionee during any calendar
        year (under all plans of the Company and subsidiary corporation) to exceed
        $100,000, such Options shall be treated as a Non-ISO. The provisions of this
        subparagraph (e) of Paragraph 4 shall be construed and applied in accordance
        with Section 422(d) of the Code and the regulations, if any, promulgated
        thereunder. 

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      5.
        Terms of Options 

      

      The
        term
        of each Option granted under the Plan shall be contained in a stock option
        agreement between the Optionee and the Company and such terms shall be
        determined by the Board of Directors consistent with the provisions of the
        Plan,
        including the following: 

      

      (a)
        The
        purchase price of the Common Shares subject to each ISO shall not be less
        than
        the fair market value (or in the case of the grant of an ISO to a Principal
        Stockholder, not less that 110% of fair market value) of such Common Shares
        at
        the time such Option is granted. Such fair market value shall be determined
        by
        the Board of Directors and, if the Common Shares are listed on a national
        securities exchange or traded on the over-the-counter market, the fair market
        value shall be the mean of the highest and lowest trading prices or of the
        high
        bid and low asked prices of the Common Shares on such exchange, or on the
        over-the-counter market as reported by the NASDAQ system or the National
        Quotation Bureau, Inc., as the case may be, on the day on which the ISO is
        granted or, if there is no trading or bid or asked price on that day, the
        mean
        of the highest and lowest trading or high bid and low asked prices on the
        most
        recent day preceding the day on which the ISO is granted for which such prices
        are available. 

      

      (b)
        The
        purchase price of the Common Shares subject to each Non-ISO shall not be
        less
        than 85% of the fair market value of such Common Shares at the time such
        Option
        is granted. Such fair market value shall be determined by the Board of Directors
        in accordance with subparagraph (a) of this Paragraph 5. The purchase price
        of
        the Common Shares subject to each Non-ISO shall be determined at the time
        such
        Option is granted. 

      

      (c)
        The
        dates on which each Option (or portion thereof) shall be exercisable and
        the
        conditions precedent to such exercise, if any, shall be fixed by the Board
        of
        Directors, in its discretion, at the time such Option is granted. 

      

      (d)
        The
        expiration of each Option shall be fixed by the Board of Directors, in its
        discretion, at the time such Option is granted; however, unless otherwise
        determined by the Board of Directors at the time such Option is granted,
        an
        Option shall be exercisable for ten (10) years after the date on which it
        was
        granted (the "Grant Date"). Each Option shall be subject to earlier termination
        as expressly provided in Paragraph 6 hereof or as determined by the Board
        of
        Directors, in its discretion, at the time such Option is granted. 

      

      (e)
        Options shall be exercised by the delivery by the Optionee thereof to the
        Company at its principal office, or at such other address as may be established
        by the Board of Directors, of written notice of the number of Common Shares
        with
        respect to which the Option is being exercised accompanied by payment in
        full of
        the purchase price of such Common Shares. Payment for such Common Shares
        may be
        made (as determined by the Board of Directors) (i) in cash, (ii) by certified
        check or bank cashier's check payable to the order of the Company in the
        amount
        of such purchase price, (iii) by a promissory note issued by the Optionee
        in
        favor of the Company in the amount equal to such purchase price and payable
        on
        terms prescribed by the Board of Directors, which provides for the payment
        of
        interest at a fair market rate, as determined by the Board of Directors,
        (iv) by
        delivery of capital stock to the Company having a fair market value (determined
        on the date of exercise in accordance with the provisions of subparagraph
        (a) of
        this Paragraph 5) equal to said purchase price, or (v) by any combination
        of the
        methods of payment described in clauses (i) through (iv) above. 

      

      (f)
        An
        Optionee shall not have any of the rights of a stockholder with respect to
        the
        Common Shares subject to his Option until such shares are issued to him upon
        the
        exercise of his Option as provided herein. 

      

      (g)
        No
        Option shall be transferable, except by will or the laws of descent and
        distribution, and any Option may be exercised during the lifetime of the
        Optionee only by him. No Option granted under the Plan shall be subject to
        execution, attachment or other process. 

      

      6.
        Term of Stock Awards.

      

      The
        term
        of each Stock Award granted under the Plan shall be contained in a stock
        award
        agreement between the Grantee and the Company and such terms shall be determined
        by the Board of Directors consistent with the provisions of the Plan, including
        the following:

      

      (a)
        A
        Grantee shall have the rights of a stockholder with respect to the Common
        Shares
        issued pursuant to his Stock Award.

      

      (b)No
        Stock Award shall be transferable, except by will or the laws of descent
        and
        distribution. No Stock Award granted under the Plan shall be subject to
        execution, attachment or other process.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      7.
        Death or Termination of Employment 

      

      (a)
        If
        employment or other relationship of an Optionee or Grantee with the Company
        shall be terminated voluntarily by the Optionee or Grantee and without the
        consent of the Company or for "Cause" (as hereinafter defined), and immediately
        after such termination such Optionee or Grantee shall not then be employed
        by
        the Company, any Options or unvested or deferred stock awards granted to
        such
        Optionee or Grantee, respectively, to the extent not theretofore exercised
        or
        vested shall expire forthwith. For purposes of the Plan, "Cause" shall mean
        "Cause" as defined in any employment agreement ("Employment Agreement") between
        Optionee or Grantee and the Company, and, in the absence of an Employment
        Agreement or in the absence of a definition of "Cause" in such Employment
        Agreement, "Cause" shall mean (i) any continued failure by the Optionee or
        Grantee to obey the reasonable instructions of the President or any member
        of
        the Board of Directors, (ii) continued neglect by the Optionee or Grantee
        of his
        duties and obligations as an employee of the Company, or a failure to perform
        such duties and obligations to the reasonable satisfaction of the President
        or
        the Board of Directors, (iii) willful misconduct of the Optionee or Grantee
        or
        other actions in bad faith by the Optionee or Grantee which are to the detriment
        of the Company, including without limitation commission of a felony,
        embezzlement or misappropriation of funds or commission of any act of fraud
        or
        (iv) a breach of any material provision of any Employment Agreement not cured
        within 10 days after written notice thereof. 

      

      (b)
        If
        such employment or other relationship shall terminate other than (i) by reason
        of death, (ii) voluntarily by the Optionee or Grantee and without the consent
        of
        the Company, or (iii) for Cause, and immediately after such termination such
        Optionee or Grantee shall not them be employed by the Company, any Options
        granted to such Optionee or any unvested or deferred Stock Awards granted
        to
        such Grantee may be exercised or may vest at any time within three months
        after
        such termination, subject to the provisions of subparagraph (d) of this
        Paragraph 7. After such three-month period, the unexercised Options or any
        unvested or deferred Stock Awards shall expire. For the purposes of the Plan,
        the retirement of an Optionee or Grantee either pursuant to a pension or
        retirement plan adopted by the Company or on the normal retirement date
        prescribed from time to time by the Company, and the termination of employment
        as a result of a disability (as defined in Section 22(e) (3) of the Code)
        shall
        be deemed to be a termination of such Optionee's or Grantee’s employment or
        other relationship other than voluntarily by the Optionee or Grantee or for
        Cause. 

      

      (c)
        If an
        Optionee or Grantee dies (i) while employed by, or engaged in such other
        relationship with, the Company or (ii) within three months after the termination
        of his employment or other relationship other than voluntarily by the Optionee
        or Grantee and without the consent of the Company or for Cause, any options
        granted to such Optionee or any unvested or deferred Stock Awards may be
        exercised or may vest at any time within twelve months after such Optionee's or
        Grantee’s death, subject to the provisions of subparagraph (d) of this Paragraph
        7. After the three month period, the unexercised Options or any unvested
        or
        deferred Stock Awards shall expire. 

      

      (d) An
        Option or Stock Award may
        not be exercised or granted pursuant to this paragraph 7 except to the extent
        that the Optionee or Grantee was entitled to exercise the Option or receive
        the
        Stock Award at the time of termination of employment or such other relationship,
        or death, and in any event may not be exercised after the expiration of the
        earlier of (i) the term of the Option or Stock Award or (ii) ten (10) years
        from
        the date the Option or Stock Award was granted, or five (5) years from the
        date
        an ISO or Stock Award was granted if the Optionee or Grantee was a Principal
        Stockholder at that date. 

      

      8.
        Leave of Absence. 

      

      For
        purposes of the Plan, an individual who is on military or sick leave or other
        bona fide leave of absence (such temporary employment by the United States
        or
        any state government) shall be considered as remaining in the employ of the
        Company for 90 days or such longer period as shall be determined by the Board
        of
        Directors. 

      

      9.
        Option Adjustments. 

      

      Adjustments
        upon Changes in Stock. 

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (a)
        Capitalization Adjustments. If any change is made in the stock subject to
        the
        Plan, or subject to any Option, without the receipt of consideration by the
        Company (through merger, consolidation, reorganization, recapitalization,
        reincorporation, stock dividend, dividend in property other than cash, stock
        split, liquidating dividend, combination of shares, exchange of shares, change
        in corporate structure or other transaction not involving the receipt of
        consideration by the Company), the Plan will be appropriately adjusted in
        the
        class(es) and maximum number of securities subject both to the Plan pursuant
        to
        subsection 4(a) and to the nondiscretionary Options specified in Section
        5, and
        the outstanding Options will be appropriately adjusted in the class(es) and
        number of securities and price per share of stock subject to such outstanding
        Options. The Board shall make such adjustments, and its determination shall
        be
        final, binding and conclusive. (The conversion of any convertible securities
        of
        the Company shall not be treated as a transaction "without receipt of
        consideration" by the Company.) 

      

      (b)
        Change in Control. In the event of: (1) a dissolution, liquidation, or sale
        of
        all or substantially all of the assets of the Company; (2) a merger or
        consolidation in which the Company is not the surviving entity; or (3) a
        reverse
        merger in which the Company is the surviving entity but the shares of Common
        Stock outstanding immediately preceding the merger are converted by virtue
        of
        the merger into other property, whether in the form of securities, cash or
        otherwise (individually, a "Change in Control"), then the vesting of outstanding
        Options shall be accelerated fifty percent (50%) prior to such Change in
        Control
        and the Options terminated if not exercised after such acceleration and at
        or
        prior to such Change in Control. 

       

      (c)
        Securities Acquisition. In the event of (i) any consolidation or merger of
        the
        Company with or into any corporation or other entity or person, or any other
        reorganization, in which the stockholders of the Company immediately prior
        to
        such consolidation, merger or reorganization, own less than fifty (50%) of
        the
        surviving entity's voting power immediately after such consolidation, merger
        or
        reorganization, (ii) any transaction or series of related transactions to
        which
        the Company is a party in which in excess of fifty percent (50%) of the
        Company's voting power is transferred, or (iii) a sale, lease or other
        disposition of all or substantially all of the assets of the Company, then
        the
        vesting of outstanding Options shall be fully accelerated. 

      

      10.
        Further Conditions of Exercise. 

      

      (a)
        Unless prior to the exercise of an Option or the vesting of a Stock Award
        the
        Common Shares issuable upon such exercise or granted pursuant to a Stock
        Award
        are the subject of a registration statement filed with the Securities and
        Exchange Commission pursuant to the Securities Act of 1933, as amended (the
        "Securities Act"), and there is then in effect a prospectus filed as part
        of
        such registration statement meeting the Requirements of Section 10(a)(3)
        of the
        Securities Act, the notice of exercise with respect to such Option or any
        purchase or other stock acquisition pursuant to a Stock Award shall be
        accompanied by a representation or agreement of the individual exercising
        the
        Option or the individual acquiring Common Shares to the Company to the effect
        that such shares are being acquired for investment only and not with a view
        to
        the resale or distribution thereof, or such other, documentation as may be
        required by the Company, unless, in the opinion of counsel to the Company,
        such
        representation, agreement or documentation is not necessary to comply with
        the
        Securities Act. 

      

      (b)
        Anything in the Plan to the contrary notwithstanding, the Company shall not
        be
        obligated to issue or sell any Common Shares until they have been listed
        on each
        securities exchange or the over the counter market on which the Common Shares
        may then be listed or trade and until and unless, in the opinion of counsel
        to
        the Company, the Company may issue such shares pursuant to a qualification
        or an
        effective registration statement, or an exemption from registration, under
        such
        state and federal laws, rules or regulations as such counsel may deem
        applicable. The Company shall use reasonable efforts to effect such listing,
        qualification and registration, as the case may be. 

      

      11.
        Termination, Modification and Amendment 

      

      (a)
        The
        Plan (but not Options or Stock Awards previously granted under the Plan)
        shall
        terminate ten (10) years from the earlier of the date of its adoption by
        the
        Board of Directors or the date on which the Plan is approved by the affirmative
        vote of the holders of a majority of the outstanding shares of capital stock
        of
        the Company entitled to vote thereon, and no Option or Stock Award shall
        be
        granted after termination of the Plan. 

      

      (b)
        The
        Plan may at any time be terminated and from time to time be modified or amended
        by the affirmative vote of the holders of a majority of the outstanding shares
        of the capital stock of the Company present, or represented, and entitled
        to
        vote at a meeting duly held in accordance with the applicable laws of the
        State
        of Nevada. 

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      (c)
        The
        Board of Directors of the Company may at any time terminate the Plan or from
        time to time make such modifications or amendments of the Plan as it may
        deem
        advisable; provided, however, that the Board of Directors shall not (i) modify
        or amend the Plan in any way that would disqualify any ISO issued pursuant
        to
        the Plan as an Incentive Stock Option or (ii) without approval by the
        affirmative vote of the holders of a majority of the outstanding shares of
        the
        capital stock of the Company present, or represented, and entitled to vote
        at a
        meeting duly held in accordance with the applicable laws of the State of
        Nevada,
        increase (except as provided by Paragraph 9) the maximum number of Common
        Shares
        as to which Options or Stock Awards may be granted under the Plan or change
        the
        class of persons eligible to receive Options or Stock Awards under the Plan,
        including any increase in the number of shares available for issuance under
        the
        Plan pursuant to the Evergreen provisions set forth in Paragraph 3(b) of
        the
        Plan, as amended. 

      

      (d)
        No
        termination, modification or amendment of the Plan may adversely affect the
        rights conferred by any Options or Stock Awards without the consent of the
        Optionee or Grantee thereof. 

      

      12.
        Effectiveness of the Plan 

      

      The
        Plan
        shall become effective upon adoption by the Board of Directors. The Plan
        shall
        be subject to approval by the affirmative vote of the holders of a majority
        of
        the outstanding shares of the capital stock of the Company entitled to vote
        thereon within one year following adoption of the Plan by the Board of
        Directors, and all Options or Stock Awards granted prior to such approval
        shall
        be subject thereto. In the event such approval is withheld, the Plan and
        all
        Options or Stock Awards which may have been granted thereunder shall become
        null
        and void. 

      

      13.
        Not a Contract of Employment 

      

      Nothing
        contained in the Plan or in any stock option or stock award agreement executed
        pursuant hereto shall be deemed to confer upon any individual to whom an
        Option
        is or may be granted hereunder any right to remain in the employ of, or in
        another relationship with, the relationship with, the Company. 

      

      14.
        Miscellaneous 

      

      (a)
        Nothing contained in the Plan or in any stock option or stock award agreement
        executed pursuant hereto shall be deemed to confer upon any individual to
        whom
        an Option is or may be granted hereunder any right to remain in the employ
        of,
        or other relationship with, the Company. 

      

      (b)
        If an
        Option or Stock Award has been granted under the Plan, additional Options
        or
        Stock Awards may be granted from time to time to the Optionee or Grantee,
        and
        Options or Stock Awards may be granted from time to time to one or more
        individuals who have not previously been granted Options or Stock Awards.
        

      

      (c)
        Nothing contained in the Plan shall be construed to limit the right of the
        Company to grant Options or Common Stock otherwise than under the Plan in
        connection with the acquisition of the business and assets of any corporation,
        firm, person or association, including options or Common Stock granted to
        employees thereof who become employees of the Company, nor shall the provisions
        of the Plan be to limit the right of the Company to grant options or Common
        Stock otherwise than under the Plan for other proper corporate purposes.
        

      

      (d)
        The
        Company shall have the right to require the Optionee or Grantee to pay the
        Company the cash amount of any taxes the Company is required to withhold
        in
        connection with the exercise of an Option or the sale of the Common Stock
        issued
        pursuant to a Stock Award. 

      

      (e)
        No
        award under this Plan shall be taken into account in determining an Optionee's
        or Grantee’s compensation for purposes of an employee benefit plan of the
        Company.

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