Document:

Blueprint

 

 

 Exhibit 10.3

SECURITIES EXCHANGE AGREEMENT

This Securities Exchange Agreement (this “Agreement”) is dated as of August ___, 2016 by and between Meridian Waste Solutions, Inc., a New York corporation (the “Company”), and that certain investor listed on the signature page attached
hereto (the “Investor”).

WHEREAS, the Investor currently holds [●] shares of the Company’s Common Stock, par value $0.025 per share (the “Common Shares”), that were issued pursuant to that certain Subscription Agreement between the Company and the Subscriber dated as of [●] in the amount of [●]
(the “Subscription Agreement”);

WHEREAS, in connection with the Subscription Agreement, the Investor was issued Warrant [●] (the “Warrant”); and

WHEREAS, subject to the terms and conditions set forth in this Agreement the Company desires to issue [●] shares of the Company’s Series C Preferred Stock, par value $0.001 per share, having such designations, rights and preferences as described in Exhibit A attached hereto (the “Preferred
Shares”) and the Investor desires to accept the Preferred Shares in exchange for (i) the cancellation and return to treasury of the Common Shares and (ii) the cancellation of the Warrant (the “Exchange”), it being expressly acknowledged and agreed that the Exchange shall be on a dollar-for-dollar basis, such that the aggregate number of Preferred Shares subject to the Exchange shall equal the aggregate number of Common Shares subject to
the Exchange (x) multiplied by 1.12 and (y) divided by 100.

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Company and the Investor hereby agree as follows:

 

ARTICLE I.

DEFINITIONS

1.1           Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings set forth in this Section 1.1:

“Affiliate” means any Person that, directly or indirectly, through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 promulgated under the Securities Act;

 “Board of Directors” means the board of directors of the Company;

“Business Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close;

“Closing” means the consummation of the Exchange pursuant to Section 2.1 hereof;

 

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“Closing Date” means the Trading Day on which this Agreement has been executed and delivered by the applicable parties hereto, and all conditions precedent to (i) the Investor’s obligation to proceed with the Closing and (ii) the Company’s obligations to deliver the Shares,
in each case, have been satisfied or waived;

“Commission” means the United States Securities and Exchange Commission;

“Common Stock” means the common stock of the Company, par value $0.001 per share, and any other class of securities into which such Common Stock may hereafter be reclassified or changed;

 “Exchange” shall have the meaning assigned to that term in the Recitals to this Agreement.

“Interest Amount” shall have the meaning assigned to that term in the Recitals to this Agreement.

 

“Liens” means a lien, charge, security interest, encumbrance, right of first refusal, preemptive right or other restriction;

 

“Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind;

 

“Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened;

 

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule;

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder;

 

 “Trading Day” means a day on which the principal Trading Market is open for trading; and

 

“Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE AMEX, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the NYSE Euronext, the OTC Bulletin Board or OTC Markets (or
any successors to any of the foregoing).

 

  

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ARTICLE II.

EXCHANGE

2.1 Closing. On the Closing Date, upon the terms and subject to the conditions set forth herein, concurrent with the execution and delivery of this Agreement by the parties hereto, the Company shall
issue to the Investor in exchange for the Common Shares, the Preferred Shares, in accordance with Section 2.3(a) hereof. Upon satisfaction of the covenants and conditions set forth in Sections 2.2, 2.3 and 2.4 hereof, the Closing shall occur.

2.2 Cancellation of Warrant. The Investor acknowledges and agrees that the Warrant is hereby cancelled. The Investor further acknowledges and agrees that rights described in Section 4 of the Subscription
Agreement are hereby cancelled, and such Section 4 is of no further force or effect.

2.3

Deliveries.

(a) On or prior to the Closing Date, the Company shall deliver or cause to be delivered to the Investor the following:

(i)

this Agreement duly executed by the Company; and

(ii) the Preferred Shares.

(b) On or prior to the Closing Date, the Investor shall deliver or cause to be delivered to the Company the following:

(i)

this Agreement duly executed by the Investor;

(ii)

the original stock certificate(s) evidencing the Common Shares; and

(iii)

the original Warrant.

 

2.4

Closing Conditions.

(a) The obligations of the Company hereunder in connection with the Closing are subject to the following conditions being met:

(i) the accuracy in all material respects when made and on the Closing Date of the representations and warranties of Investor contained herein (unless expressly stated herein as of a specific date);

(ii) all obligations, covenants and agreements of Investor required to be performed at or prior to the Closing Date shall have been performed; and

  

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(iii) the delivery by Investor of the items set forth in Section 2.3(b) of this Agreement.

(b) The obligations of the Investor hereunder in connection with the Closing are subject to the following conditions being met:

(i) the accuracy in all material respects when made and on the Closing Date of the representations and warranties of the Company contained herein (unless expressly stated herein as of a specific date);

(ii) all obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall have been performed; and

(iii) the delivery by the Company of the items set forth in Section 2.3(a) of this Agreement.

 

ARTICLE III.

REPRESENTATIONS AND WARRANTIES

3.1           Representations and Warranties of the Company. The Company hereby makes the following representations and warranties to the Investor:

(a) Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and to otherwise carry
out its obligations hereunder. The execution and delivery of this Agreement by the Company and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company and the Board of Directors in connection herewith. This Agreement has been duly executed by the Company and, when delivered in accordance with the terms hereof and upon receipt of Investor’s signature page to this Agreement,
will constitute the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution
provisions may be limited by applicable law.

(b) Issuance of the Preferred Shares. The Preferred Shares shall be duly authorized, issued and paid for in accordance with this Agreement, shall be duly and validly issued, fully paid and nonassessable,
free and clear of all Liens imposed by the Company other than restrictions on transfer provided for in this Agreement.

(c) Holding Period for the Preferred Shares. Pursuant to Rule 144, it is intended that the holding period of the Preferred Shares shall tack back to the date of the Subscription Agreement. The Company
agrees not to take a position contrary to this Section 3.1(c). The Company agrees to take all actions, including, without limitation, the issuance by its legal counsel of any necessary legal opinions, necessary to issue to the shares of common stock without restriction and not containing any restrictive legend without the need for any action by the Investor; provided such action is permitted by applicable law.

  

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(d) General Solicitation. The Company has not undertaken any advertisement, article, notice or other communication with regards to the Exchange or otherwise published in any newspaper, magazine
or similar media or broadcast over television or radio or presented at any seminar or any other general solicitation or general advertisement, regarding the Exchange.

3.2           Representations, Warranties and Covenants of Investor. Investor hereby represents and warrants as of the date hereof and as of the Closing Date to the Company as follows:

(a) Organization and Standing of Investor. If Investor is an entity, Investor is duly formed, validly existing and in good standing under the laws of the jurisdiction of its formation. If the Investor is a natural person, Investor has the legal capacity and power to enter into this Agreement.

(b) Authorization and Power. Such Investor has the requisite power and authority to enter into and perform this Agreement. The execution, delivery and performance of this Agreement by such Investor, and the consummation by such Investor of the transactions contemplated hereby and thereby, have been
duly authorized by all necessary action, and no further consent or authorization of Investor or its board of directors, manager(s), trustee, stockholders, partners, members or beneficiaries, as applicable, is required. This Agreement has been duly authorized, executed and delivered by such Investor and constitutes, or shall constitute, when executed and delivered, a valid and binding obligation of such Investor, enforceable against Investor in accordance with the terms thereof.

 (c)           No Conflicts. The execution, delivery and performance of this Agreement by Investor and the consummation by the Investor of the transactions contemplated herein do not and will not (i) conflict
with or violate any provision of the Investor’s charter or other organizational documents or (ii) conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction decree or other restriction of any court or governmental authority to which the Investor is subject (including federal and state securities laws and regulations), or by which any property or asset of the Investor is bound or affected.

(d)           Filings, Consents and Approvals. The Investor is not required to obtain any approval, consent, waiver, authorization or order of, give any notice to, or make any filing, qualification or registration with, any court or other federal,
state, local, foreign or other governmental authority or other Person in connection with the execution, delivery and performance by the Investor of this Agreement or the Common Shares.

  

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(e)           General Solicitation. The Investor is not exchanging the Common Shares for the Preferred Shares as a result of any advertisement, article, notice or other communication regarding the Preferred Shares published in any newspaper, magazine
or similar media or broadcast over television or radio or presented at any seminar or any other general solicitation or general advertisement.

(f)           Receipt of Information. The Investor believes it has received all the information it considers necessary or appropriate for deciding whether to exchange the Common Shares for the Preferred Shares. Investor further represents that
it has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of the Preferred Shares and the business, properties and financial condition of the Company and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify the accuracy of any information furnished to it or to which it had access. The Investor represents and warrants that it
has reviewed the form of Securities Purchase Agreement for the offering of up to $4,000,000 of the Preferred Shares, including the Certificate of Designations, Preferences and Rights of the Preferred Shares attached thereto, which is attached hereto as Exhibit B, and is included as an exhibit to the Company’s Current Report on Form 8-K filed with the Commission on July 25, 2016.

 

ARTICLE IV.

MISCELLANEOUS

4.1           Fees and Expenses. Each party hereto shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution,
delivery and performance of this Agreement. The Company shall pay all transfer agent fees, stamp taxes and other taxes and duties levied in connection with the delivery of the Preferred Shares to the Investor.

4.2           Entire Agreement. This Agreement contains the entire understanding of the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral or written, with respect to such matters,
which the parties hereto acknowledge have been merged into such documents, exhibits and schedules.

4.3           Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto prior to 5:30 p.m. (New York City time) on a Trading Day, and confirmation of transmission shall have been received, (b) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any
Trading Day, and confirmation of transmission shall have been received, (c) the second (2nd) Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required to be given if delivered by hand or by registered or certified mail, return receipt requested. The address for such notices and communications shall be as set forth on the signature pages
attached hereto.

  

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4.4           Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed by the Company and the Investor. No waiver of any default with respect to any provision, condition
or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party hereto to exercise any right hereunder in any manner impair the exercise of any such right.

4.5           Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.

4.6           Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their successors and permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the Investor (other than by merger). The Investor may assign any or all of its rights under this Agreement to any Person to whom the Investor assigns or transfers any of the Preferred Shares, provided that such transferee agrees in writing to be bound, with respect to the Preferred Shares, by the provisions of this Agreement that apply to the Investor.”

4.7           Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without
regard to the principles of conflicts of law thereof. Each party hereto agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the
state and federal courts sitting in the City of New York, borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of this Agreement), and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of, any such court, that such suit, action or proceeding is improper or is an inconvenient
venue for such proceeding. Each party hereto hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement, and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit
in any way any right to serve process in any other manner permitted by law. If either party hereto shall commence an action or proceeding to enforce any provisions of this Agreement, then, the prevailing party in such action or proceeding shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.

  

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4.8           Survival. The representations and warranties contained herein shall survive the Closing and the delivery of the Common Shares.

4.9           Execution. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party hereto
and delivered to the other party, it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original thereof.

4.10           Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions
set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

4.11           Replacement of Shares. If, subsequent to the date hereof, any certificate or instrument evidencing any of the Preferred Shares or Common Shares is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued
in exchange and substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances shall also pay any reasonable third-party costs (including customary indemnity) associated with the issuance of such replacement certificates.

4.12           Saturdays, Sundays, Holidays, etc.                                                                           If
the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.

4.13           Construction. The parties hereto agree that each of them and/or their respective counsel has reviewed and had an opportunity to revise this Agreement and, therefore, the normal rule of construction to the effect that any ambiguities
are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement or any amendments hereto. In addition, each and every reference to share prices and shares of Common Stock in this Agreement shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions that occur after the date of this Agreement.

 (Signature Pages Follow)

 

  

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IN WITNESS WHEREOF, the parties hereto have caused this Securities Exchange Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.

 

	
MERIDIAN WASTE SOLUTIONS, INC.

 
	
Address for Notice:

12540 Broadwell Road, Suite 2104

	
 
	
Milton, GA 30004

	
By:__________________________________________

     Name: Jeffrey Cosman

     Title: Chief Executive Officer

 

With a copy to (which shall not constitute notice):
	
 

	
 

 

Lucosky Brookman LLP

101 Wood Avenue South, 5th Floor

Iselin, NJ 08830

Attn: Scott E. Linsky, Esq.

Fax: (732) 395-4401

 
	
 

 

 

 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR THE INVESTOR FOLLOW]

 

  

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[INVESTOR SIGNATURE PAGE TO SECURITIES EXCHANGE AGREEMENT]

 

IN WITNESS WHEREOF, the undersigned has caused this Securities Exchange Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.

Name of Investor:

Signature of Investor: __________________________

 

Subscription Agreement Date:

 

Subscription Agreement Amount:

 

Common Shares Exchanged:

 

Series C Preferred Shares Exchanged:

 

 

  

10

 

 

Exhibit A

 

Certificate of Designations

 

(see attached)

 

 

 

  

11

 

 

Exhibit B

 

Form of Securities Purchase Agreement

 

(see attached)

 

 

 

 

  

12Exhibit

Exhibit 4.3

BEYONDCORE, INC.
2007 STOCK INCENTIVE PLAN
Adopted by the Board on April 25, 2007
Approved by the Stockholders on April 25, 2007
As Amended on February 11, 2014
As Amended on June 17, 2016 
 
As Amended on August 12, 2016

TABLE OF CONTENTS
	
				
	 
	 
	Page
	

	SECTION 1.
	PURPOSE.
	1
	

	SECTION 2.
	DEFINITIONS.
	1
	

	2.1
	“Board”
	1
	

	2.2
	“Change in Control”
	1
	

	2.3
	“Code”
	2
	

	2.4
	“Committee”
	2
	

	2.5
	“Company”
	2
	

	2.6
	“Consultant”
	2
	

	2.7
	“Disability”
	2
	

	2.8
	“Employee”
	2
	

	2.9
	“Exchange Act”
	2
	

	2.1
	“Exercise Price”
	2
	

	2.1
	“Fair Market Value”
	2
	

	2.1
	“ISO”
	2
	

	2.1
	“NSO”
	2
	

	2.1
	“Option”
	2
	

	2.2
	“Optionee”
	3
	

	2.2
	“Outside Director”
	3
	

	2.2
	“Parent”
	3
	

	2.2
	“Plan”
	3
	

	2.2
	“Purchase Price”
	3
	

	2.2
	“Purchaser”
	3
	

	2.2
	“Restricted Share Agreement”
	3
	

	2.2
	“Securities Act”
	3
	

	2.2
	“Service”
	3
	

	2.2
	“Share”
	3
	

	2.3
	“Stock”
	3
	

	2.3
	“Stock Option Agreement”
	3
	

	2.3
	“Subsidiary”
	4
	

	2.3
	“Ten-Percent Stockholder”
	4
	

	SECTION 3.
	ADMINISTRATION.
	4
	

	3.1
	General Rule
	4
	

	3.2
	Board Authority and Responsibility
	4
	

	SECTION 4.
	ELIGIBILITY.
	4
	

	4.1
	General Rule
	4
	

	SECTION 5.
	STOCK SUBJECT TO PLAN.
	4
	

	5.1
	Share Limit
	4
	

	5.2
	Additional Shares
	5
	

	SECTION 6.
	RESTRICTED SHARES.
	5
	

	6.1
	Restricted Share Agreement
	5
	

	6.2
	Duration of Offers and Nontransferability of Purchase Rights
	5
	

	6.3
	Purchase Price
	5
	

	6.4
	Repurchase Rights and Transfer Restrictions
	5
	

	
				
	SECTION 7.
	STOCK OPTIONS.
	5
	

	7.1
	Stock Option Agreement
	5
	

	7.2
	Number of Shares; Kind of Option
	6
	

	7.3
	Exercise Price
	6
	

	7.4
	Term
	6
	

	7.5
	Exercisability
	6
	

	7.6
	Repurchase Rights and Transfer Restrictions
	7
	

	7.7
	Transferability of Options
	7
	

	7.8
	Exercise of Options on Termination of Service
	7
	

	7.9
	No Rights as a Stockholder
	7
	

	7.1
	Modification, Extension and Renewal of Options
	8
	

	SECTION 8.
	PAYMENT FOR SHARES.
	8
	

	8.1
	General
	8
	

	8.2
	Surrender of Stock
	8
	

	8.3
	Services Rendered
	8
	

	8.4
	Promissory Notes
	8
	

	8.5
	Exercise/Sale
	8
	

	8.6
	Exercise/Pledge
	8
	

	8.7
	Other Forms of Payment
	9
	

	SECTION 9.
	ADJUSTMENT OF SHARES.
	9
	

	9.1
	General
	9
	

	9.2
	Dissolution or Liquidation
	9
	

	9.3
	Mergers and Consolidations
	9
	

	9.4
	Reservation of Rights
	9
	

	SECTION 10.
	REPURCHASE RIGHTS.
	10
	

	10.1
	Company’s Right To Repurchase Shares
	10
	

	SECTION 11.
	WITHHOLDING TAXES.
	10
	

	11.1
	General
	10
	

	11.2
	Share Withholding
	10
	

	11.3
	Cashless Exercise/Pledge
	11
	

	11.4
	Other Forms of Payment
	11
	

	SECTION 12.
	SECURITIES LAW REQUIREMENTS.
	11
	

	12.1
	General
	11
	

	12.2
	Voting and Dividend Rights
	11
	

	12.3
	Financial Reports
	11
	

	SECTION 13.
	NO RETENTION RIGHTS.
	11
	

	SECTION 14.
	DURATION AND AMENDMENTS.
	11
	

	14.1
	Term of the Plan
	11
	

	14.2
	Right to Amend or Terminate the Plan
	12
	

	14.3
	Effect of Amendment or Termination
	12
	

BEYONDCORE, INC.
2007 STOCK INCENTIVE PLAN
SECTION 1. PURPOSE
The Plan was adopted by the Board of Directors effective as set forth on the cover page hereof.  The purpose of the Plan is to offer selected service providers the opportunity to acquire equity in the Company through awards of Options (which may constitute incentive stock options or nonstatutory stock options) and the award or sale of Shares.
The award of Options and the award or sale of Shares under the Plan is intended to be exempt from the securities qualification requirements of the California Corporations Code by satisfying the exemption under section 25102(o) of the California Corporations Code.  However, awards of Options and the award or sale of Shares may be made in reliance upon other state securities law exemptions.  To the extent that such other exemptions are relied upon, the terms of this Plan which are included only to comply with section 25102(o) shall be disregarded to the extent provided in the Stock Option Agreement or Restricted Share Agreement.
SECTION 2. DEFINITIONS.
		
	2.1

	“Board” shall mean the Board of Directors of the Company, as constituted from time to time.

		
	2.2

	“Change in Control” shall mean the occurrence of any of the following events:

		
	(a)

	The consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if persons who were not stockholders of the Company immediately prior to such merger, consolidation or other reorganization own immediately after such merger, consolidation or other reorganization fifty percent (50%) or more of the voting power of the outstanding securities of each of (A) the continuing or surviving entity and (B) any direct or indirect parent corporation of such continuing or surviving entity;

		
	(b)

	The consummation of the sale, transfer or other disposition of all or substantially all of the Company’s assets or the stockholders of the Company approve a plan of complete liquidation of the Company; or

		
	(c)

	Any “person” (as defined below) who, by the acquisition or aggregation of securities, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company 

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representing fifty percent (50%) or more of the combined voting power of the Company’s then outstanding securities ordinarily (and apart from rights accruing under special circumstances) having the right to vote at elections of directors (the “Base Capital Stock”); except that any change in the relative beneficial ownership of the Company’s securities by any person resulting solely from a reduction in the aggregate number of outstanding shares of Base Capital Stock, and any decrease thereafter in such person’s ownership of securities, shall be disregarded until such person increases in any manner, directly or indirectly, such person’s beneficial ownership of any securities of the Company.
For purposes of Section 2.2(c), the term “person” shall have the same meaning as when used in sections 13(d) and 14(d) of the Exchange Act but shall exclude (1) a trustee or other fiduciary holding securities under an employee benefit plan maintained by the Company or a Parent or Subsidiary and (2) a corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of the Stock.
Notwithstanding the foregoing, the term “Change in Control” shall not include a transaction the sole purpose of which is (a) to change the state of the Company’s incorporation, (b) to form a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction; or (c) to make an initial public offering of the Company’s Stock.
		
	2.3

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

		
	2.4

	“Committee” shall mean the committee designated by the Board, which is authorized to administer the Plan, as described in Section 3 hereof.

2.5
    “Company” shall mean BeyondCore, Inc., a Delaware corporation.
		
	2.6

	“Consultant” shall mean a consultant or advisor who is not an Employee or Outside Director and who performs bona fide services for the Company, a Parent or Subsidiary.

		
	2.7

	“Disability” shall mean a condition that renders an individual unable to engage in substantial gainful activity by reason of any medically determinable physical or mental impairment.

		
	2.8

	“Employee” shall mean any individual who is a common-law employee of the Company, a Parent or a Subsidiary and who is an “employee” within the meaning of section 3401(c) of the Code and regulations issued thereunder.

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	2.9

	“Exchange Act” shall mean the U.S. Securities and Exchange Act of 1934, as amended.

		
	2.10

	“Exercise Price” shall mean the amount for which one Share may be purchased upon the exercise of an Option, as specified in a Stock Option Agreement.

		
	2.11

	“Fair Market Value” means, with respect to a Share, the market price of one Share of Stock, determined by the Board in good faith.  Such determination shall be conclusive and binding on all persons.

		
	2.12

	“ISO” shall mean an incentive stock option described in section 422(b) of the Code.

		
	2.13

	“NSO” shall mean a stock option that is not an ISO.

		
	2.14

	“Option” shall mean an ISO or NSO granted under the Plan and entitling the holder to purchase Shares.

		
	2.15

	“Optionee” shall mean an individual or estate that holds an Option.

		
	2.16

	“Outside Director” shall mean a member of the Board of the Company, a Parent or a Subsidiary who is not an Employee.

		
	2.17

	“Parent” shall mean any corporation (other than the Company) in an unbroken chain of corporations ending with the Company, if each of the corporations other than the Company owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.  A corporation that attains the status of a Parent on a date after the adoption of the Plan shall be considered a Parent commencing as of such date.

		
	2.18

	“Plan” shall mean the BeyondCore, Inc. 2007 Stock Incentive Plan.

		
	2.19

	“Purchase Price” shall mean the consideration for which one Share may be acquired under the Plan (other than upon exercise of an Option).

3

		
	2.20

	“Purchaser” shall mean a person to whom the Board has offered the right to acquire Shares under the Plan (other than upon exercise of an Option).

		
	2.21

	“Restricted Share Agreement” shall mean the agreement between the Company and a Purchaser who acquires Shares under the Plan that contains the terms, conditions and restrictions pertaining to the acquisition of such Shares.

		
	2.22

	“Securities Act” shall mean the U.S. Securities Act of 1933, as amended.

		
	2.23

	“Service” shall mean service as an Employee, a Consultant or an Outside Director, subject to such further limitations as may be set forth in the applicable Stock Option Agreement or Restricted Share Agreement.  Service shall be deemed to continue during a bona fide leave of absence approved by the Company in writing if and to the extent that continued crediting of Service for purposes of the Plan is expressly required by the terms of such leave or by applicable law, as determined by the Company.  However, for purposes of determining whether an Option is entitled to ISO status, and to the extent required under the Code, an Employee’s employment will be treated as terminating ninety (90) days after such Employee went on leave, unless such Employee’s right to return to active work is guaranteed by law or by a contract or such Employee immediately returns to active work.  The Company determines which leaves count toward Service, and when Service terminates for all purposes under the Plan.

		
	2.24

	“Share” shall mean one share of Stock, as adjusted in accordance with Section 9 (if applicable).

		
	2.25

	“Stock” shall mean the common stock of the Company.

		
	2.26

	“Stock Option Agreement” shall mean the agreement between the Company and an Optionee which contains the terms, conditions and restrictions pertaining to the Optionee’s Option.

		
	2.27

	“Subsidiary” means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company, if each of the corporations other than the last corporation in the unbroken chain owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.  A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan shall be considered a Subsidiary commencing as of such date.

4

		
	2.28

	“Ten-Percent Stockholder” means an individual who owns more than ten percent (10%) of the total combined voting power of all classes of outstanding stock of the Company, its Parent or any of its Subsidiaries.  In determining stock ownership for purposes of this Section 2.28, the attribution rules of section 424(d) of the Code shall be applied.

SECTION 3.    ADMINISTRATION.
		
	3.1

	General Rule.  The Plan shall be administered by the Board.  However, the Board may delegate any or all administrative functions under the Plan otherwise exercisable by the Board to one or more Committees.  Each Committee shall consist of at least one member of the Board who has been appointed by the Board.  Each Committee shall have the authority and be responsible for such functions as the Board has assigned to it.  If a Committee has been appointed, any reference to the Board in the Plan shall be construed as a reference to the Committee to whom the Board has assigned a particular function.  The Board may also authorize one or more officers of the Company to designate Employees, other than such authorized officer or officers, to receive Awards and/or to determine the number of such Awards to be received by such persons; provided, however, that the Board shall specify the total number of Awards that such officer or officers may so award.

		
	3.2

	Board Authority and Responsibility.  Subject to the provisions of the Plan, the Board shall have full authority and discretion to take any actions it deems necessary or advisable for the administration of the Plan.  All decisions, interpretations and any other actions of the Board with respect to the Plan shall be final and binding on all persons deriving rights under the Plan.

SECTION 4.    ELIGIBILITY. 
		
	4.1

	General Rule.  Only Employees shall be eligible for the grant of ISOs.  Only Employees, Consultants and Outside Directors shall be eligible for the grant of NSOs or the award or sale of Shares.

SECTION 5.    STOCK SUBJECT TO PLAN.
		
	5.1

	Share Limit.  Subject to Sections 5.2 and 9, the aggregate number of Shares which may be issued under the Plan shall not exceed 5,909,911 Shares.  The number of Shares which are subject to Options or other rights outstanding at any time shall not exceed the number of Shares which then remain available for issuance under the Plan.  The Company, during the term of the Plan, shall at all times reserve and keep available 

5

sufficient Shares to satisfy the requirements of the Plan.  Shares offered under the Plan may be authorized but unissued Shares or treasury Shares.
		
	5.2

	Additional Shares.  In the event that any outstanding Option or other right expires or is canceled for any reason, the Shares allocable to the unexercised portion of such Option or other right shall remain available for issuance pursuant to the Plan.  If a Share previously issued under the Plan is reacquired by the Company pursuant to a forfeiture provision, right of repurchase or right of first refusal, then such Share shall again become available for issuance under the Plan.

SECTION 6.    RESTRICTED SHARES.  
		
	6.1

	Restricted Share Agreement.  Each award or sale of Shares under the Plan (other than upon exercise of an Option) shall be evidenced by a Restricted Share Agreement between the Purchaser and the Company.  Such award or sale shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions imposed by the Board, as set forth in the Restricted Share Agreement, that are not inconsistent with the Plan.  The provisions of the various Restricted Share Agreements entered into under the Plan need not be identical.

		
	6.2

	Duration of Offers and Nontransferability of Purchase Rights.  Any right to acquire Shares (other than an Option) shall automatically expire if not exercised by the Purchaser within thirty (30) days after the Company communicates the grant of such right to the Purchaser.  Such right shall be nontransferable and shall be exercisable only by the Purchaser to whom the right was granted.

		
	6.3

	Purchase Price.  The Purchase Price of Shares offered under the Plan shall not be less than eighty-five percent (85%) of the Fair Market Value of such Shares; provided, however, if the Purchaser is a Ten-Percent Stockholder, the Purchase Price shall not be less than one hundred percent (100%) of the Fair Market Value of such Shares.  Subject to the foregoing in this Section 63, the Board shall determine the amount of the Purchase Price in its sole discretion.  The Purchase Price shall be payable in a form described in Section 8.

		
	6.4

	Repurchase Rights and Transfer Restrictions.  Each award or sale of Shares shall be subject to such forfeiture conditions, rights of repurchase, rights of first refusal and other transfer restrictions as the Board may determine, subject to the requirements of Section 10.  Such restrictions shall be set forth in the applicable Restricted Share Agreement and shall apply in addition to any restrictions otherwise applicable to holders of Shares generally.

6

SECTION 7.    STOCK OPTIONS.
		
	7.1

	Stock Option Agreement.  Each grant of an Option under the Plan shall be evidenced by a Stock Option Agreement between the Optionee and the Company.  The Option shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions imposed by the Board, as set forth in the Stock Option Agreement, which are not inconsistent with the Plan.  The provisions of the various Stock Option Agreements entered into under the Plan need not be identical.

		
	7.2

	Number of Shares; Kind of Option.  Each Stock Option Agreement shall specify the number of Shares that are subject to the Option and shall provide for the adjustment of such number in accordance with Section 9.  The Stock Option Agreement shall also specify whether the Option is intended to be an ISO or an NSO.

		
	7.3

	Exercise Price.  Each Stock Option Agreement shall set forth the Exercise Price, which shall be payable in a form described in Section 8.  Subject to the following requirements, the Exercise Price under any Option shall be determined by the Board in its sole discretion:

		
	(a)

	Minimum Exercise Price for ISOs.  The Exercise Price per Share of an ISO shall not be less than one hundred percent (100%) of the Fair Market Value of a Share on the date of grant; provided, however, that the Exercise Price per Share of an ISO granted to a Ten-Percent Stockholder shall not be less than one hundred ten percent (110%) of the Fair Market Value of a Share on the date of grant.

		
	(b)

	Exercise Price for NSOs.  The Exercise Price per Share of an NSO shall be determined by the Board in its sole discretion.

		
	7.4

	Term.  Each Stock Option Agreement shall specify the term of the Option.  The term of an Option shall in no event exceed ten (10) years from the date of grant.  The term of an ISO granted to a Ten-Percent Stockholder shall not exceed five (5) years from the date of grant.  Subject to the foregoing, the Board in its sole discretion shall determine when an Option shall expire.

		
	7.5

	Exercisability.  Each Stock Option Agreement shall specify the date when all or any installment of the Option is to become exercisable; provided, however, that no Option shall be exercisable unless the Optionee has delivered to the Company an executed copy of the Stock Option Agreement.  Subject to the following restrictions, the 

7

Board in its sole discretion shall determine when all or any installment of an Option is to become exercisable and may, in its discretion, provide for accelerated exercisability in the event of a Change in Control or other events:
		
	(a)

	Options Granted to Employees.  An Option granted to an Optionee who is not a Consultant or an officer or director of the Company, a Parent or a Subsidiary shall be exercisable at the minimum rate of twenty percent (20%) per year for each of the first five (5) years starting from the date of grant, subject to reasonable conditions such as continued Service.

		
	(b)

	Options Granted to Outside Directors, Consultants or Officers.  An Option granted to an Optionee who is a Consultant or an officer or director of the Company, a Parent or a Subsidiary shall be exercisable at any time or during any period established by the Board, subject to reasonable conditions such as continued Service; provided, however, that the exercisability of an Option granted to an Optionee for service as an Outside.  Director shall be automatically accelerated in full in the event of a Change in Control.

		
	(c)

	Early Exercise.  A Stock Option Agreement may permit the Optionee to exercise the Option as to Shares that are subject to a right of repurchase by the Company in accordance with the requirements of Section 10.1.

		
	7.6

	Repurchase Rights and Transfer Restrictions.  Shares purchased on exercise of Options shall be subject to such forfeiture conditions, rights of repurchase, rights of first refusal and other transfer restrictions as the Board may determine, subject to the requirements of Section 10.  Such restrictions shall be set forth in the applicable Stock Option Agreement and shall apply in addition to any restrictions otherwise applicable to holders of Shares generally.

		
	7.7

	Transferability of Options.  During an Optionee’s lifetime, his or her Options shall be exercisable only by the Optionee or by the Optionee’s guardian or legal representatives, and shall not be transferable other than by beneficiary designation, will or the laws of descent and distribution.  Notwithstanding the foregoing, however, to the extent permitted by the Board in its sole discretion, an NSO may be transferred by the Optionee to one or more family members or a trust established for the benefit of the Optionee and/or one or more family members to the extent permitted by section 260.140.41(d) of Title 10 of the California Code of Regulations and Rule 701 of the Securities Act.

		
	7.8

	Exercise of Options on Termination of Service.  Each Option shall set forth the 

8

extent to which the Optionee shall have the right to exercise the Option following termination of the Optionee’s Service.  Each Stock Option Agreement shall provide the Optionee with the right to exercise the Option following the Optionee’s termination of Service during the Option term, to the extent the Option was exercisable for vested Shares upon termination of Service, for at least thirty (30) days if termination of Service is due to any reason other than cause, death or Disability, and for at least six (6) months after termination of Service if due to death or Disability (but in no event later than the expiration of the Option term).  If the Optionee’s Service is terminated for cause, the Stock Option Agreement may provide that the Optionee’s right to exercise the Option terminates immediately on the effective date of the Optionee’s termination.  To the extent the Option was not exercisable for vested Shares upon termination of Service, the Option shall terminate when the Optionee’s Service terminates.  Subject to the foregoing, such provisions shall be determined in the sole discretion of the Board, need not be uniform among all Options issued pursuant to the Plan, and may reflect distinctions based on the reasons for termination of Service.
		
	7.9

	No Rights as a Stockholder.  An Optionee, or a transferee of an Optionee, shall have no rights as a stockholder with respect to any Shares covered by the Option until such person becomes entitled to receive such Shares by filing a notice of exercise and paying the Exercise Price pursuant to the terms of the Option.  No adjustments shall be made, except as provided in Section 9.

		
	7.10

	Modification, Extension and Renewal of Options.  Within the limitations of the Plan, the Board may modify, extend or renew outstanding Options or may accept the cancellation of outstanding Options (to the extent not previously exercised), whether or not granted hereunder, in return for the grant of new Options for the same or a different number of Shares and at the same or a different Exercise Price.  The foregoing notwithstanding, no modification of an Option shall, without the consent of the Optionee, impair his or her rights or increase the Optionee’s obligations under such Option.

SECTION 8.    PAYMENT FOR SHARES.
		
	8.1

	General.  The entire Purchase Price or Exercise Price of Shares issued under the Plan shall be payable in cash, cash equivalents or one of the other forms provided in this Section 8.

		
	8.2

	Surrender of Stock.  To the extent permitted by the Board in its sole discretion, payment may be made in whole or in part by surrendering, or attesting to ownership of, Shares which have already been owned by the Optionee; provided, however, that payment may not be made in such form if such action would cause the Company to recognize any (or additional) compensation expense with respect to the Option for financial reporting purposes.  Such Shares shall be surrendered to the Company in good 

9

form for transfer and shall be valued at their Fair Market Value on the date of Option exercise.
		
	8.3

	Services Rendered.  As determined by the Board in its discretion, Shares may be awarded under the Plan in consideration of past services rendered to the Company, a Parent or Subsidiary.

		
	8.4

	Promissory Notes.  To the extent permitted by the Board in its sole discretion, payment may be made in whole or in part with a full-recourse promissory note executed by the Optionee or Purchaser.  The interest rate payable under the promissory note shall not be less than the minimum rate required to avoid the imputation of income for U.S. federal income tax purposes.  Shares shall be pledged as security for payment of the principal amount of the promissory note, and interest thereon; provided that if the Optionee or Purchaser is a Consultant, such note must be collateralized with such additional security to the extent required by applicable laws.  In no event shall the stock certificate(s) representing such Shares be released to the Optionee or Purchaser until such note is paid in full.  Subject to the foregoing, the Board shall determine the term, interest rate and other provisions of the note.

		
	8.5

	Exercise/Sale.  To the extent permitted by the Board in its sole discretion, and if a public market for the Shares exists, payment may be made in whole or in part by delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker approved by the Company to sell Shares and to deliver all or part of the sale proceeds to the Company in payment of all or part of the Exercise Price and any withholding taxes.

		
	8.6

	Exercise/Pledge.  To the extent permitted by the Board in its sole discretion, and if a public market for the Shares exists, payment may be made in whole or in part by delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker or lender approved by the Company to pledge Shares, as security for a loan, and to deliver all or part of the loan proceeds to the Company in payment of all or part of the Exercise Price and any withholding taxes.

		
	8.7

	Other Forms of Payment.  To the extent permitted by the Board in its sole discretion, payment may be made in any other form that is consistent with applicable laws, regulations and rules.

SECTION 9.    ADJUSTMENT OF SHARES.
		
	9.1

	General.  In the event of a subdivision of the outstanding Stock, a declaration of a dividend payable in Shares, a declaration of an extraordinary dividend payable in a form 

10

other than Shares in an amount that has a material effect on the Fair Market Value of the Stock, a combination or consolidation of the outstanding Stock into a lesser number of Shares, a recapitalization, a spin-off, a reclassification, or a similar occurrence, the Board shall make appropriate adjustments to one or more of the following: (i) the number of Shares available for future awards under Section 5; (ii) the number of Shares covered by each outstanding Option; (iii) the Exercise Price under each outstanding Option; or (iv) the price of Shares subject to the Company’s right of repurchase.
		
	9.2

	Dissolution or Liquidation.  To the extent not previously exercised or settled, Options shall terminate immediately prior to the dissolution or liquidation of the Company.

		
	9.3

	Mergers and Consolidations.  In the event that the Company is a party to a merger or other consolidation, or in the event of a transaction providing for the sale of all or substantially all of the Company’s stock or assets, outstanding Options shall be subject to the agreement of merger, consolidation or sale.  Such agreement may provide for one or more of the following: (i) the continuation of the outstanding Options by the Company, if the Company is a surviving corporation; (ii) the assumption of the Plan and outstanding Options by the surviving corporation or its parent; (iii) the substitution by the surviving corporation or its parent of options with substantially the same terms for such outstanding Options; (iv) immediate exercisability of such outstanding Options followed by the cancellation of such Options; or (v) settlement of the full value of the outstanding Options (whether or not then exercisable) in cash or cash equivalents followed by the cancellation of such Options; in each case without the Optionee’s consent.

		
	9.4

	Reservation of Rights.  Except as provided in this Section 9, an Optionee or offeree shall have no rights by reason of any subdivision or consolidation of shares of stock of any class, the payment of any dividend or any other increase or decrease in the number of shares of stock of any class.  Any issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number or Exercise Price of Shares subject to an Option.  The grant of an Option pursuant to the Plan shall not affect in any way the right or power of the Company to make adjustments, reclassifications, reorganizations or changes of its capital or business structure, to merge or consolidate or to dissolve, liquidate, sell or transfer all or any part of its business or assets.

SECTION 10.        REPURCHASE RIGHTS.
		
	10.1

	Company’s Right To Repurchase Shares.  The Company shall have the right to repurchase Shares that have been acquired through an award or sale of Shares or exercise of an Option upon termination of the Purchaser’s or Optionee’s Service if provided in the 

11

applicable Restricted Share Agreement or Stock Option Agreement.  Subject to the following restrictions, the Board in its sole discretion shall determine when the right to repurchase shall lapse as to all or any portion of the Shares, and may, in its discretion, provide for accelerated vesting in the event of a Change in Control or other events; provided, however, that the right to repurchase shall lapse as to all of the Shares issued to an Outside Director for service as an Outside Director in the event of a Change in Control.  The following restrictions shall apply in the case of a Purchaser or Optionee who is not a Consultant or an officer or director of the Company, a Parent or Subsidiary:
		
	(a)

	Repurchase Price.  If the Company retains a right to repurchase the Shares at not less than the Fair Market Value of the Shares on the date that the Purchaser’s Service terminates, then such repurchase right shall terminate when the Company’s Stock becomes publicly traded.  If the Company retains a right to repurchase the Shares at the original Purchase Price or Exercise Price, then such repurchase right shall lapse at the minimum rate of twenty percent (20%) per year over the five (5) year period starting on the date of the award or sale of Shares or grant of the Option.

		
	(b)

	Exercise of Repurchase Right.  The Company’s right of repurchase under this Section 10.1 may be exercised only within ninety (90) days of the date on which the Purchaser’s or Optionee’s Service terminates or, if the Optionee acquired the Shares upon exercise of an Option after the date of termination, within ninety (90) days from the date of exercise.

		
	(c)

	Payment of Repurchase Price.  The Company shall pay the repurchase price in cash, cash equivalents or for cancellation of indebtedness incurred in purchasing the Shares.

SECTION 11.        WITHHOLDING TAXES.
		
	11.1

	General.  An Optionee or Purchaser or his or her successor shall pay, or make arrangements satisfactory to the Board for the satisfaction of, any federal, state, local or foreign withholding tax obligations that may arise in connection with the Plan.  The Company shall not be required to issue any Shares or make any cash payment under the Plan until such obligations are satisfied.

		
	11.2

	Share Withholding.  The Board may permit an Optionee or Purchaser to satisfy all or part of his or her withholding or income tax obligations by having the Company withhold all or a portion of any Shares that otherwise would be issued to him or her or by surrendering all or a portion of any Shares that he or she previously acquired; provided, however, that in no event may an Optionee or Purchaser surrender Shares in excess of the 

12

legally required withholding amount.  Such Shares shall be valued at their Fair Market Value on the date when taxes otherwise would be withheld in cash.  Any payment of taxes by assigning Shares to the Company may be subject to restrictions, including any restrictions required by rules of any federal or state regulatory body or other authority.
		
	11.3

	Cashless Exercise/Pledge.  The Board may provide that if Company Shares are publicly traded at the time of exercise, arrangements may be made to meet the Optionee’s or Purchaser’s withholding obligation by cashless exercise or pledge.

		
	11.4

	Other Forms of Payment.  The Board may permit such other means of tax withholding as it deems appropriate.

SECTION 12.        SECURITIES LAW REQUIREMENTS.
		
	12.1

	General.  Shares shall not be issued under the Plan unless the issuance and delivery of such Shares complies with (or is exempt from) all applicable requirements of law, including (without limitation) the Securities Act, the rules and regulations promulgated thereunder, state securities laws and regulations, and the regulations of any stock exchange or other securities market on which the Company’s securities may then be listed.

		
	12.2

	Voting and Dividend Rights.  The holders of Shares acquired under the Plan shall have the same voting, dividend and other rights as the Company’s other stockholders.  A Restricted Share Agreement, however, may require that the holders of Shares invest any cash dividends received in additional Shares.  Such additional Shares shall be subject to the same conditions and restrictions as the award with respect to which the dividends were paid.

		
	12.3

	Financial Reports.  At least annually, the Company shall furnish its financial statements, including a balance sheet regarding the Company’s financial condition and results of operations, to Optionees, Purchasers and stockholders who have received Shares under the Plan, unless such persons are key employees whose duties at the Company assure them access to equivalent information.  Financial statements need not be audited.

SECTION 13.        NO RETENTION RIGHTS.
No provision of the Plan, or any right or Option granted under the Plan, shall be construed to give any Optionee or Purchaser any right to become an Employee, to be treated as an Employee, or to continue in Service for any period of time, or restrict in any way the rights of the Company (or Parent or subsidiary to whom the Optionee or Purchaser provides Service), 

13

which rights are expressly reserved, to terminate the Service of such person at any time and for any reason, with or without cause, without thereby incurring any liability to him or her.
SECTION 14.        DURATION AND AMENDMENTS.
		
	14.1

	Term of the Plan.  The Plan, as set forth herein, shall become effective on the date of its adoption by the Board, subject to the approval of the Company’s stockholders.  In the event that the stockholders fail to approve the Plan within twelve (12) months after its adoption by the Board, any grants, exercises or sales that have already occurred under the Plan shall be rescinded, and no additional grants, exercises or sales shall be made under the Plan after such date.  The Plan shall terminate automatically ten (10) years after its adoption by the Board.  The Plan may be terminated on any earlier date pursuant to Section 14.2 below.

		
	14.2

	Right to Amend or Terminate the Plan.  The Board may amend, suspend, or terminate the Plan at any time and for any reason.  An amendment of the Plan shall not be subject to the approval of the Company’s stockholders unless it (i) increases the number of Shares available for issuance under the Plan (except as provided in Section 9) or (ii) materially changes the class of persons who are eligible for the grant of Options or the award or sale of Shares.  At least two-thirds (2/3) of the Company’s Shares entitled to vote must affirmatively approve an increase in the number of Shares available for issuance if the total number of Shares that may be issued upon the exercise of all outstanding Options and the total number of Shares provided under any stock bonus or similar plan of the Company exceed thirty percent (30%) of all outstanding Shares of the Company.

		
	14.3

	Effect of Amendment or Termination.  No Shares shall be issued or sold under the Plan after the termination thereof, except upon exercise of an Option granted prior to such termination.  The termination of the Plan, or any amendment thereof, shall not adversely affect any Shares previously issued or any Option previously granted under the Plan without the holder’s consent.

14

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