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Unassociated Document

    EXHIBIT
      10.1

    SURFECT
      HOLDINGS, INC.

    2008
      EQUITY INCENTIVE PLAN

    

    

    1. Scope
      of Plan; Definitions.
      

    

    (a) This
      2008
      Equity Incentive Plan (the “Plan”) is intended to advance the interests of
      Surfect Holdings, Inc. (the “Company”) and its Related Corporations by enhancing
      the ability of the Company to attract and retain qualified employees,
      consultants, Officers, directors, by creating incentives and rewards for their
      contributions to the success of the Company and its Related Corporations. This
      Plan will provide to (a) Officers and other employees of the Company and its
      Related Corporations opportunities to purchase common stock (“Common Stock”) of
      the Company pursuant to Options granted hereunder which qualify as incentive
      stock options (“ISOs”) under Section 422(b) of the Internal Revenue Code of 1986
      (the “Code”), (b) directors, Officers, employees and consultants of the Company
      and Related Corporations opportunities to purchase Common Stock in the Company
      pursuant to options granted hereunder which do not qualify as ISOs
      (“Non-Qualified Options”); (c) directors, Officers, employees and consultants of
      the Company and Related Corporations opportunities to receive shares of Common
      Stock of the Company which normally are subject to restrictions on sale
      (“Restricted Stock”); (d) directors, Officers, employees and consultants of the
      Company and Related Corporations opportunities to receive grants of stock
      appreciation rights (“SARs”); and (e) directors, Officers, employees and
      consultants of the Company and Related Corporations opportunities to receive
      grants of restricted stock units (“RSUs”). ISOs, Non-Discretionary Options and
      Non-Qualified Options are referred to hereafter as “Options.” Options,
      Restricted Stock, RSUs and SARs are sometimes referred to hereafter collectively
      as “Stock Rights.” Any of the Options and/or Stock Rights may in the
      Compensation Committee’s discretion be issued in tandem to one or more other
      Options and/or Stock Rights to the extent permitted by law.

    

    This
      Plan
      is intended to comply in all respects with Rule 16b-3 (“Rule 16b-3”) and its
      successor rules as promulgated under Section 16(b) of the Securities Exchange
      Act of 1934 (the “Exchange Act”) for participants who are subject to Section 16
      of the Exchange Act. To the extent any provision of the Plan or action by the
      Plan administrators fails to so comply, it shall be deemed null and void to
      the
      extent permitted by law and deemed advisable by the Plan administrators.
Provided,
      however,
      such
      exercise of discretion by the Plan administrators shall not interfere with
      the
      contract rights of any grantee. In the event that any interpretation or
      construction of the Plan is required, it shall be interpreted and construed
      in
      order to ensure, to the maximum extent permissible by law, that such grantee
      does not violate the short-swing profit provisions of Section 16(b) of the
      Exchange Act and that any exemption available under Rule 16b-3 or other rule
      is
      available.

    

    (b) For
      purposes of the Plan, capitalized words and terms shall have the following
      meaning:

     

    “Board”
      means the board of directors of the Company.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    

    “Bulletin
      Board” shall mean the Over-the-Counter Bulletin Board.

    

    “Chairman”
      means the chairman of the Board.

    

    “Change
      of Control” means the occurrence of any of the following events: (i) any
“person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act)
      becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act),
      directly or indirectly, of securities of the Company representing 50% or more
      of
      the total voting power represented by the Company’s then outstanding voting
      securities; (ii)  the consummation of the sale or disposition by the
      Company of all or substantially all of the Company’s assets in a transaction
      which requires shareholder approval under applicable state law; or
      (iii) the consummation of a merger or consolidation of the Company with any
      other corporation, other than a merger or consolidation which would result
      in
      the voting securities of the Company outstanding immediately prior thereto
      continuing to represent (either by remaining outstanding or by being converted
      into voting securities of the surviving entity or its parent) at least 50%
      of
      the total voting power represented by the voting securities of the Company
      or
      such surviving entity or its parent outstanding immediately after such merger
      or
      consolidation.

    

    “Code”
      shall
      have the meaning given to it in Section 1(a).

    

    “Common
      Stock” shall
      have the meaning given to it in Section 1(a).

     

    “Company”
      shall have the meaning given to it in Section 1(a).

     

    “Disability”
      means “permanent and total disability” as defined in Section 22(e)(3) of the
      Code or successor statute.

    

    “Disqualifying
      Disposition” means any disposition (including any sale) of Common Stock
      underlying an ISO before the later of (i) two years after the date of employee
      was granted the ISO or (ii) one year after the date the employee acquired Common
      Stock by exercising the ISO.

    

    “Exchange
      Act” shall have the meaning given to it in Section 1(a).

    

    “Fair
      Market Value” shall be determined as of the Trading Day on or the last Trading
      Day before the date a Stock Right is granted and shall mean:

    

    (1) the
      closing price on the principal market if the Common Stock is listed on a
      national securities exchange or the Bulletin Board. 

    

    (2) if
      the
      Company’s shares are not listed on a national securities exchange or the
      Bulletin Board, then the closing price if reported or the average bid and asked
      price for the Company’s shares as published by Pink Sheets LLC;

    
      
         

      

      
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    (3) if
      there
      are no prices available under clauses (1) or (2), then Fair Market Value shall
      be based upon the average closing bid and asked price as determined following
      a
      polling of all dealers making a market in the Company’s Common Stock;
      or

     

    (4) if
      there
      is no regularly established trading market for the Company’s Common Stock, the
      Fair Market Value shall be established by the Board or the Compensation
      Committee taking into consideration all relevant factors including the most
      recent price at which the Company’s Common Stock was sold.

    

    “ISO”
      shall have the meaning given to it in Section 1(a).

    

    “Non-Discretionary
      Options” shall have the meaning given to it in Section 1(a).

    

    “Non-Qualified
      Options” shall have the meaning given to it in Section 1(a).

    

    “Officers”
      means a person who is an executive officer of the Company and is required to
      file ownership reports under Section 16(a) of the Exchange Act.

    

    “Options”
      shall have the meaning given to it in Section 1(a).

    

    “Plan”
      shall have the meaning given to it in Section 1(a).

    

    “Qualifying
      Committee” means the Company’s audit committee, Compensation Committee, finance
      committee or any other committee of the Board that the compensation committee
      shall determine entitles its members to a grant of Stock Rights, as defined,
      under Section 3(b)(ii) (each such Committee, a “Qualifying
      Committee”).

    

    “Related
      Corporations” shall mean a corporation which is a subsidiary corporation with
      respect to the Company within the meaning of Section 425(f) of the Code.

    

    “Restricted
      Stock” shall have the meaning contained in Section 1(a). 

    

    “RSU”
      shall have the meaning given to it in Section 1(a).

    

    “Rule
      16b-3” shall have the meaning given to it in Section 1(a).

    

    “SAR”
      shall have the meaning given to it in Section 1(a).

    

    “Securities
      Act” means the Securities Act of 1933.

    

    “Compensation
      Committee” means the stock option committee of the Board, if any, which
shall
      consist of two or more members of the Board, each of whom shall be both an
      “outside director” within the meaning of Section 162(m) of the Code and a
“non-employee director” within the meaning of Rule 16b-3. All references in this
      Plan to the Compensation Committee shall mean the Board when (i) there is no
      Compensation Committee or (ii) the Board has retained the power to administer
      this Plan.

    
      
         

      

      
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    “Stock
      Rights” shall have the meaning given to it in Section 1(a).

    

    “Trading
      Day” shall mean a day on which the New York Stock Exchange is open for
      business.

    

    2. Administration
      of the Plan.

    

    (a) The
      Plan
      may be administered by the entire Board or by the Compensation Committee. Once
      appointed, the Compensation Committee shall continue to serve until otherwise
      directed by the Board. A majority of the members of the Compensation Committee
      shall constitute a quorum, and all determinations of the Compensation Committee
      shall be made by the majority of its members present at a meeting. Any
      determination of the Compensation Committee under the Plan may be made without
      notice or meeting of the Compensation Committee by a writing signed by all
      of
      the Compensation Committee members. Subject to ratification of the grant of
      each
      Stock Right by the Board (but only if so required by applicable state law),
      and
      subject to the terms of the Plan, the Compensation Committee shall have the
      authority to (i) determine the employees of the Company and Related Corporations
      (from among the class of employees eligible under Section 3 to receive ISOs)
      to
      whom ISOs may be granted, and to determine (from among the class of individuals
      and entities eligible under Section 3 to receive Non-Qualified Options,
      Restricted Stock, RSUs and SARs) to whom Non-Qualified Options, Restricted
      Stock, RSUs and SARs may be granted; (ii) determine when Stock Rights may be
      granted; (iii) determine the exercise prices of Stock Rights other than
      Restricted Stock and RSUs, which shall not be less than the Fair Market Value;
      (iv) determine whether each Option granted shall be an ISO or a Non-Qualified
      Option; (v) determine when Stock Rights shall become exercisable, the duration
      of the exercise period and when each Stock Right shall vest; (vi) determine
      whether restrictions such as repurchase
      options are to be imposed on shares subject to or issued in connection with
      Stock Rights, and the nature of such restrictions, if any, and (vii) interpret
      the Plan and promulgate and rescind rules and regulations relating to it. The
      interpretation and construction by the Compensation Committee of any provisions
      of the Plan or of any Stock Right granted under it shall be final, binding
      and
      conclusive unless otherwise determined by the Board. The Compensation Committee
      may from time to time adopt such rules and regulations for carrying out the
      Plan
      as it may deem best.

    

    No
      members of the Compensation Committee or the Board shall be liable for any
      action or determination made in good faith with respect to the Plan or any
      Stock
      Right granted under it. No member of the Compensation Committee or the Board
      shall be liable for any act or omission of any other member of the Compensation
      Committee or the Board or for any act or omission on his own part, including
      but
      not limited to the exercise of any power and discretion given to him under
      the
      Plan, except those resulting from his own gross negligence or willful
      misconduct.

    

    (b) The
      Compensation Committee may select one of its members as its chairman and shall
      hold meetings at such time and places as it may determine. All references in
      this Plan to the Compensation Committee shall mean the Board if no Compensation
      Committee has been appointed. From time to time the Board may increase the
      size
      of the Compensation Committee and appoint additional members thereof, remove
      members (with or without cause) and appoint new members in substitution
      therefor, fill vacancies however caused or remove all members of the
      Compensation Committee and thereafter directly administer the
      Plan.

    
      
         

      

      
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    (c) Stock
      Rights may be granted to members of the Board, whether such grants are in their
      capacity as directors, Officers or consultants. All grants of Stock Rights
      to
      members of the Board shall in all other respects be made in accordance with
      the
      provisions of this Plan applicable to other eligible persons. Members of the
      Board who are either (i) eligible for Stock Rights pursuant to the Plan or
      (ii)
      have been granted Stock Rights may vote on any matters affecting the
      administration of the Plan or the grant of any Stock Rights pursuant to the
      Plan.

    

    (d) In
      addition to such other rights of indemnification as he may have as a member
      of
      the Board, and with respect to administration of the Plan and the granting
      of
      Stock Rights under it, each member of the Board and of the Compensation
      Committee shall be entitled without further act on his part to indemnification
      from the Company for all expenses (including advances of litigation expenses,
      the amount of judgment and the amount of approved settlements made with a view
      to the curtailment of costs of litigation) reasonably incurred by him in
      connection with or arising out of any action, suit or proceeding, including
      any
      appeal thereof, with respect to the administration of the Plan or the granting
      of Stock Rights under it in which he may be involved by reason of his being
      or
      having been a member of the Board or the Compensation Committee, whether or
      not
      he continues to be such member of the Board or the Compensation Committee at
      the
      time of the incurring of such expenses; provided,
      however,
      that
      such indemnity shall be subject to the limitations contained in any
      Indemnification Agreement between the Company and the Board member or Officer.
      The foregoing right of indemnification shall inure to the benefit of the heirs,
      executors or administrators of each such member of the Board or the Compensation
      Committee and shall be in addition to all other rights to which such member
      of
      the Board or the Compensation Committee would be entitled to as a matter of
      law,
      contract or otherwise. 

    

    (e) The
      Board
      may delegate the powers to grant Stock Rights to Officers to the extent
      permitted by the laws of the Company’s state of incorporation.

    

    3. Eligible
      Employees and Others.
      

    

    (a) (i) ISOs
      may
      be granted to any employee of the Company or any Related Corporation. Those
      Officers and directors of the Company who are not employees may not be granted
      ISOs under the Plan. ISOs
      may
      not be granted unless this Plan has been approved by the Company’s shareholders
      within one year after it has been adopted by the Board.

    

    (ii) Subject
      to compliance with Rule 16b-3 and other applicable securities laws,
      Non-Qualified Options, Restricted Stock, RSUs and SARs may be granted to any
      director (whether or not an employee), Officers, employees or consultants of
      the
      Company or any Related Corporation. 

    

    (iii) The
      Compensation Committee may take into consideration a recipient’s individual
      circumstances in determining whether to grant an ISO, a Non-Qualified Option,
      Restricted Stock, RSUs or a SAR. Granting of any Stock Right to any individual
      or entity shall neither entitle that individual or entity to, nor disqualify
      him
      from participation in, any other grant of Stock Rights.

    
      
         

      

      
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    (b) All
      directors of the Company who are not employees or beneficial owners of 10%
      or
      more of the Common Stock of the Company or Related Corporations shall
      automatically receive the following grant of five-year Non-Qualified Options
      as
      appropriate:

    

    (i) Initial
      Grants. On the date on which this Plan is approved by the Board or a person
      is
      first elected or appointed, whether elected by the shareholders of the Company
      or appointed by the Board to fill a Board vacancy, he or she shall receive
      an
      automatic grant of Non-Qualified Options as follows:

    

    
      	
              (A)

            	
              Chairman
                of the Board - 

            	
              100,000
                Options;

            
	
              (B)

            	
              Director
                -

            	
              200,000
                Options; and

            
	
              (C)

            	
              Chairman
                of a committee - 

            	
              50,000
                Options. 

            

    

     

    (ii) Annual
      Grants. On the next business day following the date on which a person is
      re-elected or re-appointed as long as the person has served in the same capacity
      for at least 12 months, he or she shall receive an automatic grant of
      Non-Qualified Options as follows:

    

    
      	
              (A)

            	
              Chairman
                of the Board -

            	
              100,000
                Options;

            
	
              (B)
                

            	
              Director
                - 

            	
              200,000
                Options; and

            
	
              (C)

            	
              Chairman
                of a committee - 

            	
              50,000
                Options.

            

    

    

      (iii)
      Vesting. All grants under this Section 3(b) shall vest over a three-year period
      on the last calendar day of each fiscal quarter, subject to service with the
      Company in the capacity in which the grant is received on the applicable vesting
      dates. The Non-Qualified Options shall be for a period of five years unless
      otherwise provided by the Board.

               

    (iv)
      All
      grants of Non-Qualified Options under this Section 3(b) are subject to
      adjustment under Section 14.

    

    (c) The
      exercise price of the Options or SARs under Section 3 shall be Fair Market
      Value
      or such higher price as may be established by the Compensation Committee, the
      Board or by the Code.

     

    4. Common
      Stock.
      The
      Common Stock subject to Stock Rights shall be authorized but unissued shares
      of
      Common Stock, par value $0.0001, or shares of Common Stock reacquired by the
      Company in any manner, including purchase, forfeiture or otherwise. The
      aggregate number of shares of Common Stock which may be issued pursuant to
      the
      Plan is 58,000,000 subject to adjustment as provided in Section 14. Any such
      shares may be issued under ISOs, Non-Qualified Options, Restricted Stock, RSUs
      or SARs, so long as the number of shares so issued does not exceed the
      limitations in this Section. If any Stock Rights granted under the Plan shall
      expire or terminate for any reason without having been exercised in full or
      shall cease for any reason to be exercisable in whole or in part, or if the
      Company shall reacquire any unvested shares, the unpurchased shares subject
      to
      such Stock Rights and any unvested shares so reacquired by the Company shall
      again be available for grants under the Plan.

    
      
         

      

      
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    5. Granting
      of Stock Rights.

    

    (a) The
      date
      of grant of a Stock Right under the Plan will be the date specified by the
      Board
      or Compensation Committee at the time it grants the Stock Right; provided,
      however,
      that
      such date shall not be prior to the date on which the Board or Compensation
      Committee acts to approve the grant. The Board or Compensation Committee shall
      have the right, with the consent of the optionee, to convert an ISO granted
      under the Plan to a Non-Qualified Option pursuant to Section 17.

    

    (b) Except
      for automatic grants under Section 3(b), the Board or Compensation Committee
      shall grant Stock Rights to participants that it, in its sole discretion,
      selects. Stock Rights shall be granted on such terms as the Board or
      Compensation Committee shall determine except that ISOs shall be granted on
      terms that comply with the Code and regulations thereunder.

    

    (c) A
      SAR
      entitles the holder to receive, as designated by the Board
      or
Compensation
      Committee, cash or shares of Common Stock, value equal to (or otherwise based
      on) the excess of: (a) the Fair Market Value of a specified number of shares
      of
      Common Stock at the time of exercise over (b) an exercise price established
      by
      the
      Board
      or
      Compensation Committee. The exercise price of each SAR granted under this Plan
      shall be established by the Compensation Committee or shall be determined by
      a
      method established by the
      Board
      or
      Compensation Committee at the time the SAR is granted, provided the exercise
      price shall not be less than 100% of the Fair Market Value of a share of Common
      Stock on the date of the grant of the SAR, or such higher price as is
      established by the
      Board
      or
      Compensation Committee. A SAR shall be exercisable in accordance with such
      terms
      and conditions and during such periods as may be established by the
      Board
      or
      Compensation Committee. Shares of Common Stock delivered pursuant to the
      exercise of a SAR shall be subject to such conditions, restrictions and
      contingencies as the Board
      or
Compensation
      Committee may establish in the applicable SAR agreement or document, if any.
      The
      Board
      or
      Compensation Committee, in its discretion, may impose such conditions,
      restrictions and contingencies with respect
      to shares of Common Stock acquired pursuant to the exercise of each SAR as
      the
      Board or Compensation Committee determines to be desirable. A SAR under the
      Plan
      shall be subject to such terms and conditions, not inconsistent with the Plan,
      as the Board or Compensation Committee shall, in its discretion, prescribe.
      The
      terms and conditions of any SAR to any grantee shall be reflected in such form
      of agreement as is determined by the Board or Compensation Committee. A copy
      of
      such document, if any, shall be provided to the grantee, and the Board or
      Compensation Committee may condition the granting of the SAR on the grantee
      executing such agreement.

    

    (d) An
      RSU
      gives the grantee the right to receive a number of shares of the Company’s
      Common Stock on applicable vesting or other dates. Delivery of the RSUs may
      be
      deferred beyond vesting as determined by the Board or Compensation Committee.
      RSUs shall be evidenced by an RSU agreement in the form determined by the Board
      or Compensation Committee. With
      respect to an RSU, which becomes non-forfeitable due to the lapse of time,
      the
      Compensation Committee shall prescribe in the RSU agreement the vesting period.
      With respect to the granting of the RSU, which becomes non-forfeitable due
      to
      the satisfaction of certain pre-established performance-based objectives imposed
      by the Board or Compensation Committee, the measurement date of whether such
      performance-based objectives have been satisfied shall be a date no earlier
      than
      the first anniversary of the date of the RSU. A recipient who is granted an
      RSU
      shall possess no incidents of ownership with respect to such underlying Common
      Stock, although the RSU agreement may provide for payments in lieu of dividends
      to such grantee. 

    
      
         

      

      
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    (e) Notwithstanding
      any provision of this Plan, the Board or Compensation Committee may impose
      conditions and restrictions on any grant of Stock Rights including forfeiture
      of
      vested Options, cancellation of Common Stock acquired in connection with any
      Stock Right and forfeiture of profits.

    

    (f) The
      Options and SARs shall not be exercisable for a period of more than 10 years
      from the date of grant.

    

    6. Sale
      of Shares.
      The
      shares underlying Stock Rights granted to any Officers, director or a beneficial
      owner of 10% or more of the Company’s securities registered under Section 12 of
      the Exchange Act shall not be sold, assigned or transferred by the grantee
      until
      at least six months elapse from the date of the grant thereof.

    

    7. ISO
      Minimum Option Price and Other Limitations.

    

    (a) The
      exercise price per share relating to all Options granted under the Plan shall
      not be less than the Fair Market Value per share of Common Stock on the last
      trading day prior to the date of such grant. For purposes of determining the
      exercise price, the date of the grant shall be the later of (i) the date of
      approval by the Board or Compensation Committee or the Board, or (ii) for ISOs,
      the date the recipient becomes an employee of the Company. In the case of an
      ISO
      to be granted to an employee owning Common Stock which represents more than
      10
      percent of the total combined voting power of all classes of stock of the
      Company or any Related Corporation, the price per share shall not be less than
      110% of the Fair Market Value per share of Common Stock on the date of grant
      and
      such ISO shall not be exercisable after the expiration of five years from the
      date of grant.

    

    (b) In
      no
      event shall the aggregate Fair Market Value (determined at the time an ISO
      is
      granted) of Common Stock for which ISOs granted to any employee are exercisable
      for the first time by such employee during any calendar year (under all stock
      option plans of the Company and any Related Corporation) exceed $100,000. Any
      ISO or portion thereof which exceeds such limit (according to the order in
      which
      they are granted) shall be treated as a Non-Qualified Option, notwithstanding
      any contrary provision of the applicable agreement covering the
      ISO.

    

    8. Duration
      of Stock Rights.
      Subject
      to earlier termination as provided in Sections 3, 5, 9, 10 and 11, each Option
      and SAR shall expire on the date specified in the original instrument granting
      such Stock Right (except with respect to any part of an ISO that is converted
      into a Non-Qualified Option pursuant to Section 17), provided,
      however,
      that
      such instrument must comply with Section 422 of the Code with regard to ISOs
      and
      Rule 16b-3 with regard to all Stock Rights granted pursuant to the Plan to
      Officers, directors and 10% shareholders of the Company. 

    
      
         

      

      
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    9. Exercise
      of Options and SARs; Vesting of Stock Rights.
      Subject
      to the provisions of Sections 3 and 9 through 13, each Option and SAR granted
      under the Plan shall be exercisable as follows:

    

    (a) The
      Options and SARs shall either be fully vested and exercisable from the date
      of
      grant or shall vest and become exercisable in such installments as the Board
      or
      Compensation Committee may specify.

    

    (b) Once
      an
      installment becomes exercisable it shall remain exercisable until expiration
      or
      termination of the Option and SAR, unless otherwise specified by the Board
      or
      Stock Option Committee.

    

    (c) Each
      Option and SAR or installment, once it becomes exercisable, may be exercised
      at
      any time or from time to time, in whole or in part, for up to the total number
      of shares with respect to which it is then exercisable.

    

    (d) The
      Board
      or Compensation Committee shall have the right to accelerate the vesting date
      of
      any installment of any Stock Right; provided
      that the
      Board or Compensation Committee shall not accelerate the exercise date of any
      installment of any Option granted to any employee as an ISO (and not previously
      converted into a Non-Qualified Option pursuant to Section 17) if such
      acceleration would violate the annual exercisability limitation contained in
      Section 422(d) of the Code as described in Section 7(b). 

    

    10. Termination
      of Employment.
      Subject
      to any greater restrictions or limitations as may be imposed by the Board or
      Compensation Committee upon the granting of any Option or SAR, if an optionee
      or
      holder of an SAR ceases to be employed by the Company and all Related
      Corporations other than by reason of death or Disability, no further
      installments of his Options or SARs shall become exercisable, and his Options
      or
      SARs shall terminate as provided for in the grant or on the day three months
      after the day of the termination of his employment, whichever is earlier, but
      in
      no event later than on their specified expiration dates. Employment shall be
      considered as continuing uninterrupted during any bona fide leave of absence
      (such as those attributable to illness, military obligations or governmental
      service) provided that the period of such leave does not exceed 90 days or,
      if
      longer, any period during which such optionee’s right to re-employment is
      guaranteed by statute. A leave of absence with the written approval of the
      Board
      shall not be considered an interruption of employment under the Plan, provided
      that such written approval contractually obligates the Company or any Related
      Corporation to continue the employment of the optionee after the approved period
      of absence. Options or SARs granted under the Plan shall not be affected by
      any
      change of employment within or among the Company and Related Corporations so
      long as the optionee continues to be an employee of the Company or any Related
      Corporation.

    

    11. Death;
      Disability.
      Subject
      to any greater restrictions or limitations as may be imposed by the Board or
      Compensation Committee upon the granting of any Option or SAR:

    
      
         

      

      
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    (a) If
      the
      holder of an Option or SAR ceases to be employed by the Company and all Related
      Corporations by reason of his death, any Options or SARs of such employee may
      be
      exercised to the extent of the number of shares with respect to which he could
      have exercised it on the date of his death, by his estate, personal
      representative or beneficiary who has acquired the Options or SARs by will
      or by
      the laws of descent and distribution, at any time prior to the earlier of the
      Options’ or SARs’ specified expiration date or one year from the date of the
      grantee’s death.

    

    (b) If
      the
      holder of an Option or SAR ceases to be employed by the Company and all Related
      Corporations, or a director can no longer perform his duties, by reason of
      his
      Disability, he shall have the right to exercise any Option or SARs held by
      him
      on the date of termination of employment or ceasing to act as a director until
      the earlier of (i) the Options’ or SARs’ specified expiration date or (ii) one
      year from the date of the termination of the person’s employment or ceasing to
      act as a director. 

    

    12. Assignment,
      Transfer or Sale.

    

    (a) No
      ISO
      granted under this Plan shall be assignable or transferable by the grantee
      except by will or by the laws of descent and distribution, and during the
      lifetime of the grantee, each ISO shall be exercisable only by him, his guardian
      or legal representative.   

    

    (b) Except
      for ISOs, all Stock Rights are transferable subject to compliance with
      applicable securities laws and Section 6 of this Plan. 

    

    13. Terms
      and Conditions of Stock Rights.
      Stock
      Rights shall be evidenced by instruments (which need not be identical) in such
      forms as the Board or Compensation Committee may from time to time approve.
      Such
      instruments shall conform to the terms and conditions set forth in Sections
      5
      through 12 hereof and may contain such other provisions as the Board or
      Compensation Committee deems advisable which are not inconsistent with the
      Plan.
      In granting any Stock Rights, the Board or Compensation Committee may specify
      that Stock Rights shall be subject to the restrictions set forth herein with
      respect to ISOs, or to such other termination and cancellation provisions as
      the
      Board or Compensation Committee may determine. The Board or Compensation
      Committee may from time to time confer authority and responsibility on one
      or
      more of its own members and/or one or more Officers of the Company to execute
      and deliver such instruments. The proper Officers of the Company are authorized
      and directed to take any and all action necessary or advisable from time to
      time
      to carry out the terms of such instruments.

    

    14. Adjustments
      Upon Certain Events.

    

    (a) Subject
      to any required action by the shareholders of the Company, the number of shares
      of Common Stock covered by each outstanding Stock Right, and the number of
      shares of Common Stock which have been authorized for issuance under the Plan
      but as to which no Stock Rights have yet been granted or which have been
      returned to the Plan upon cancellation or expiration of a Stock Right, as well
      as the price per share of Common Stock (or cash, as applicable) covered by
      each
      such outstanding Option or SAR, shall be proportionately adjusted for any
      increases or decrease in the number of issued shares of Common Stock resulting
      from a stock split, reverse stock split, stock dividend, combination or
      reclassification of Common Stock, or any other increase or decrease in the
      number of issued shares of Common Stock effected without receipt of
      consideration by the Company; provided,
      however,
      that
      conversion of any convertible securities of the Company or the voluntary
      cancellation whether by virtue of a cashless exercise of a derivative security
      of the Company or otherwise shall not be deemed to have been “effected without
      receipt of consideration.” Such adjustment shall be made by the
      Board
      or
      Compensation Committee, whose determination in that respect shall be final,
      binding and conclusive.  Except as expressly provided herein, no issuance
      by the Company of shares of stock of any class, or securities convertible into
      shares of stock of any class, shall affect, and no adjustment by reason thereof
      shall be made with respect to, the number or price of shares of Common Stock
      subject to a Stock Right.
      No
      adjustments shall be made for dividends or other distributions paid in cash
      or
      in property other than securities of the Company.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    

    

    (b) In
      the
      event of the proposed dissolution or liquidation of the Company, the
Board
      or
Compensation
      Committee shall notify each participant as soon as practicable prior to the
      effective date of such proposed transaction. To the extent it has not been
      previously exercised, a Stock Right will terminate immediately prior to the
      consummation of such proposed action.

    

    (c) In
      the
      event of a merger of the Company with or into another corporation, or a Change
      of Control, each outstanding Stock Right shall be assumed (as defined below)
      or
      an equivalent option or right substituted by the successor corporation or a
      parent or subsidiary of the successor corporation.  In the event that the
      successor corporation refuses to assume or substitute for the Stock Rights,
      the
      participants shall fully vest in and have the right to exercise their Stock
      Rights as to which it would not otherwise be vested or exercisable.  If a
      Stock Right becomes fully vested and exercisable in lieu of assumption or
      substitution in the event of a merger or sale of assets, the Board
      or
Stock
      Option Committee shall notify the participant in writing or electronically
      that
      the Stock Right shall be fully vested and exercisable for a period of at least
      15 days from the date of such notice, and any Options or SARs shall terminate
      one minute prior to the closing of the merger or sale of assets. 

     

    For
      the
      purposes of this Section 14(c), the Stock Right shall be considered “assumed”
if, following the merger or Change of Control, the option or right confers
      the
      right to purchase or receive, for each share of Common Stock subject to the
      Stock Right immediately prior to the merger or Change of Control, the
      consideration (whether stock, cash, or other securities or property) received
      in
      the merger or Change of Control by holders of Common Stock for each share held
      on the effective date of the transaction (and if holders were offered a choice
      of consideration, the type of consideration chosen by the holders of a majority
      of the outstanding Shares); provided,
      however,
      that if
      such consideration received in the merger or Change of Control is not solely
      common stock of the successor corporation or its parent, the Board
      or
Compensation
      Committee may, with the consent of the successor corporation, provide for the
      consideration to be received upon the exercise of the Stock Right, for each
      share of Common Stock subject to the Stock Right, to be solely common stock
      of
      the successor corporation or its parent equal in Fair Market Value to the per
      share consideration received by holders of Common Stock in the merger or Change
      of Control.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    

    

    (d) Notwithstanding
      the foregoing, any adjustments made pursuant to Section 14(a), (b) or (c) with
      respect to ISOs shall be made only after the Board
      or
Compensation
      Committee, after consulting with counsel for the Company, determines whether
      such adjustments would constitute a “modification” of such ISOs (as that term is
      defined in Section 425(h) of the Code) or would cause any adverse tax
      consequences for the holders of such ISOs. If the Board
      or
Compensation
      Committee determines that such adjustments made with respect to ISOs would
      constitute a modification of such ISOs it may refrain from making such
      adjustments.

    

    (e) No
      fractional shares shall be issued under the Plan and the optionee shall receive
      from the Company cash in lieu of such fractional shares.

    

    15. Means
      of Exercising Stock Rights.

    

    (a) An
      Option
      or SAR (or any part or installment thereof) shall be exercised by giving written
      notice to the Company at its principal office address. Such notice shall
      identify the Stock Right being exercised and specify the number of shares as
      to
      which such Stock Right is being exercised, accompanied by full payment of the
      exercise price therefor (to the extent it is exercisable in cash) either (i)
      in
      United States dollars by check or wire transfer; or (ii) at the discretion
      of
      the Board or Compensation Committee, through delivery of shares of Common Stock
      having a Fair Market Value equal as of the date of the exercise to the cash
      exercise price of the Stock Right; or (iii) at the discretion of the Board
      or
      Compensation Committee, by any combination of (i) and (ii) above. If the Board
      or Compensation Committee exercises its discretion to permit payment of the
      exercise price of an ISO by means of the methods set forth in clauses (ii)
      or
      (iii) of the preceding sentence, such discretion need not be exercised in
      writing at the time of the grant of the Stock Right in question. The holder
      of a
      Stock Right shall not have the rights of a shareholder with respect to the
      shares covered by his Stock Right until the date of issuance of a stock
      certificate to him for such shares. Except as expressly provided above in
      Section 14 with respect to changes in capitalization and stock dividends, no
      adjustment shall be made for dividends or similar rights for which the record
      date is before the date such stock certificate is issued.

    

    (b) Each
      notice of exercise shall, unless the shares of Common Stock are covered by
      a
      then current registration statement under the Securities Act, contain the
      holder’s acknowledgment in form and substance satisfactory to the Company that
      (i) such shares are being purchased for investment and not for distribution
      or
      resale (other than a distribution or resale which, in the opinion of counsel
      satisfactory to the Company, may be made without violating the registration
      provisions of the Securities Act), (ii) the holder has been advised and
      understands that (1) the shares have not been registered under the Securities
      Act and are “restricted securities” within the meaning of Rule 144 under the
      Securities Act and are subject to restrictions on transfer and (2) the Company
      is under no obligation to register the shares under the Securities Act or to
      take any action which would make available to the holder any exemption from
      such
      registration, and (iii) such shares may not be transferred without compliance
      with all applicable federal and state securities laws. Notwithstanding the
      above, should the Company be advised by counsel that issuance of shares should
      be delayed pending registration under federal or state securities laws or the
      receipt of an opinion that an appropriate exemption therefrom is available,
      the
      Company may defer exercise of any Stock Right granted hereunder until either
      such event has occurred.

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    

    

    16. Term,
      Termination and Amendment.
      

    

    (a) This
      Plan
      was adopted by the Board. This Plan may be approved by the Company’s
      shareholders within one year from the date of Board approval, which approval
      is
      required for ISOs, or on a later date.

    

    (b) The
      Board
      may terminate the Plan at any time. Unless sooner terminated, the Plan shall
      terminate on March 22, 2018. No Stock Rights may be granted under the Plan
      once
      the Plan is terminated. Termination of the Plan shall not impair rights and
      obligations under any Stock Right granted while the Plan is in effect, except
      with the written consent of the grantee.

    

    (c) The
      Board
      at any time, and from time to time, may amend the Plan. Provided,
      however,
      except
      as provided in Section 14 relating to adjustments in Common Stock, no amendment
      shall be effective unless approved by the shareholders of the Company to the
      extent (i) shareholder approval is necessary to satisfy the requirements of
      Section 422 of the Code or (ii) required by the rules of the principal national
      securities exchange or trading market upon which the Company’s Common Stock
      trades. Rights under any Stock Rights granted before amendment of the Plan
      shall
      not be impaired by any amendment of the Plan, except with the written consent
      of
      the grantee.

    

    (d) The
      Board
      at any time, and from time to time, may amend the terms of any one or more
      Stock
      Rights; provided,
      however,
      that
      the rights under the Stock Right shall not be impaired by any such amendment,
      except with the written consent of the grantee.

    

    17. Conversion
      of ISOs into Non-Qualified Options; Termination of ISOs.
      The
Board
      or
Compensation
      Committee, at the written request of any optionee, may in its discretion take
      such actions as may be necessary to convert such optionee’s ISOs (or any
      installments or portions of installments thereof) that have not been exercised
      on the date of conversion into Non-Qualified Options at any time prior to the
      expiration of such ISOs, regardless of whether the optionee is an employee
      of
      the Company or a Related Corporation at the time of such conversion.
 Provided,
      however,
      the
Board
      or
Compensation
      Committee shall not reprice the Options or extend the exercise period or reduce
      the exercise price of the appropriate installments of such Options without
      the
      approval of the Company’s shareholders. At
      the
      time of such conversion, the Board or Compensation Committee (with the consent
      of the optionee) may impose such conditions on the exercise of the resulting
      Non-Qualified Options as the Board or Compensation Committee in its discretion
      may determine, provided that such conditions shall not be inconsistent with
      this
      Plan. Nothing in the Plan shall be deemed to give any optionee the right to
      have
      such optionee’s ISOs converted into Non-Qualified Options, and no such
      conversion shall occur until and unless the Board or Compensation Committee
      takes appropriate action. The Compensation Committee, with the consent of the
      optionee, may also terminate any portion of any ISO that has not been exercised
      at the time of such termination.

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    

    18. Application
      of Funds.
      The
      proceeds received by the Company from the sale of shares pursuant to Options
      or
      SARS (if cash settled) granted under the Plan shall be used for general
      corporate purposes.

    

    19. Governmental
      Regulations.
      The
      Company’s obligation to sell and deliver shares of the Common Stock under this
      Plan is subject to the approval of any governmental authority required in
      connection with the authorization, issuance or sale of such shares.

    

    20. Withholding
      of Additional Income Taxes.
      In
      connection with the granting, exercise or vesting of a Stock Right or the making
      of a Disqualifying Disposition the Company, in accordance with Section 3402(a)
      of the Code, may require the optionee to pay additional withholding taxes in
      respect of the amount that is considered compensation includable in such
      person’s gross income. 

    

    To
      the
      extent that the Company is required to withhold taxes for federal income tax
      purposes as provided above, if any optionee may elect to satisfy such
      withholding requirement by (i) paying the amount of the required withholding
      tax
      to the Company; (ii) delivering to the Company shares of its Common Stock
      (including shares of Restricted Stock) previously owned by the optionee; or
      (iii) having the Company retain a portion of the shares covered by an Option
      exercise. The number of shares to be delivered to or withheld by the Company
      times the Fair Market Value of such shares shall equal the cash required to
      be
      withheld. 

    

    21. Notice
      to Company of Disqualifying Disposition.
      Each
      employee who receives an ISO must agree to notify the Company in writing
      immediately after the employee makes a Disqualifying Disposition of any Common
      Stock acquired pursuant to the exercise of an ISO. If the employee has died
      before such stock is sold, the holding periods requirements of the Disqualifying
      Disposition do not apply and no Disqualifying Disposition can occur
      thereafter.

    

    22. Continued
      Employment.
      The
      grant of a Stock Right pursuant to the Plan shall not be construed to imply
      or
      to constitute evidence of any agreement, express or implied, on the part of
      the
      Company or any Related Corporation to retain the grantee in the employ of the
      Company or a Related Corporation, as a member of the Company’s Board or in any
      other capacity, whichever the case may be.

    

    23. Governing
      Law; Construction.
      The
      validity and construction of the Plan and the instruments evidencing Stock
      Rights shall be governed by the laws of Delaware. In construing this Plan,
      the
      singular shall include the plural and the masculine gender shall include the
      feminine and neuter, unless the context otherwise requires.

    

    24. Compliance
      with Section 409A of the Code.
      To
      the
      extent that the Board or the Compensation Committee determines that any Stock
      Right granted under this Plan is subject to Section 409A of the Code, the
      agreement evidencing such Stock Right shall incorporate the terms and conditions
      required by Section 409A of the Code. To the extent applicable, this Plan and
      the Stock Right agreement shall be interpreted in accordance with Section 409A
      of the Code. Notwithstanding any provision of this Plan to the contrary, in
      the
      event that, the Board or the Compensation Committee determines that any Stock
      Right may be subject to Section 409A of the Code, the Board or the Compensation
      Committee may adopt such amendments to this Plan and the applicable Stock Right
      agreement or adopt other policies and procedures (including amendments, policies
      and procedures with retroactive effect), or take any other actions, that the
      Board or the Compensation Committee determines are necessary or appropriate
      to
      (i) exempt the Stock Right from Section 409A of the Code and/or preserve the
      intended tax treatment of the benefits provided with respect to the Stock Right,
      or (ii) comply with the requirements of Section 409A of the
      Code.

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    

    

    25. Forfeiture
      of Stock Rights.
      Notwithstanding any other provision of this Plan, all vested Stock Rights shall
      be immediately forfeited at the option of the Board in the event
      of:

    

    (a) Termination
      for any reason including without cause and including, but not limited to, fraud,
      theft, employee dishonesty and violation of Company policy;

    

    (b) Purchasing
      or selling securities of the Company without written authorization in accordance
      with the Company’s inside information guidelines then in effect;

    

    (c) Breaching
      any duty of confidentiality including that required by the Company’s inside
      information guidelines then in effect;

    

    
      
        (d)
          Competing
          with the Company;

      

    

    

    (e) Being
      unavailable for consultation after leaving the Company’s employ if such
      availability is a condition of any agreement between the Company and the
      Employee;

    

    (f) Recruitment
      of Company personnel after termination of employment, whether such termination
      is voluntary or for cause;

    

    (g) Failure
      to assign any invention or technology to the Company if such assignment is
      a
      condition of employment or any other agreements between the Company and the
      Employee; or

     

    (h) A
      finding
      by the Company’s Board that the Employee has acted against the interests of the
      Company.

    

    Removal
      of an Officer or director by the Board or shareholders, as applicable, shall
      not
      constitute termination within the meaning of Section 25(a). 

    

    The
      Board
      or the Compensation Committee may impose other forfeiture restrictions which
      are
      more or less restrictive and require a return of profits from the sale of Common
      Stock as part of said forfeiture provisions if such forfeiture provisions and/or
      return of provisions are contained in a Stock Rights or similar
      agreement.

     

     

    
      
         

      

      
        15Unassociated Document

    

      Exhibit
        10.20 

    

     

    EXECUTIVE
      EMPLOYMENT AGREEMENT

     

    This
      EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”)
      is
      made and entered into as of the 31st day of December, 2007, by and between
      CLEAR
      SKIES HOLDINGS, INC., a Delaware corporation with offices at 5020 sunrise
      Highway, Suite 227, Massapequa Park, New York 11762 (the “Corporation”),
      and
      ARTHUR L. GOLDBERG, an individual residing at 34 Oak Avenue, Larchmont, New
      York
      10538 (“Executive”).

     

    WITNESSETH:

     

    WHEREAS,
      the Executive desires to be employed by the Company as its Chief Financial
      Officer and the Company wishes to employ Executive in such
      capacity;

     

    NOW,
      THEREFORE, in consideration of the foregoing recitals and the respective
      covenants and agreements of the parties contained in this document, the Company
      and Executive hereby agree as follows: 

     

    1. Employment
      and Duties.
      The
      Company agrees to employ and Executive agrees to serve as the Company's Chief
      Financial Officer. The duties and responsibilities of Executive shall include
      the duties and responsibilities as the Board may from time to time reasonably
      assign to Executive. 

     

    Executive
      shall devote substantially all of his working time and efforts during the
      Company's normal business hours to the business and affairs of the Company
      and
      its subsidiaries and to the diligent and faithful performance of the duties
      and
      responsibilities duly assigned to him pursuant to this Agreement.

     

    2. Term.
      The
      term of this Agreement shall commence on the Effective Date and shall continue
      for a period of two years and shall be automatically renewed for successive
      one
      year periods thereafter unless either party provides the other party with
      written notice of his or its intention not to renew this Agreement at least
      three months prior to the expiration of the initial term or any renewal term
      of
      this Agreement. “Employment Period” shall mean the initial two year term plus
      renewals, if any. The Effective Date shall be that date on which Executive
      actually starts working full time under this Agreement for the Corporation
      as
      will be stated in a later document to be signed by both parties when that date
      is known with certainty. Between the date first above written and the Effective
      Date the Executive shall make himself reasonably available (recognizing that
      Executive is presently employed in New Jersey on a full time basis) for
      telephone discussions during, and meetings outside of, usual working hours
      with
      officers and employees of, or advisors or consultants to, Corporation and to
      study and review any written or electronic material concerning the Corporation
      supplied to Executive. 

     

    3. Place
      of Employment.
      Executive's services shall be performed at the Company's offices located in
      Massapequa, New York and any other locus where the Company now or hereafter
      may
      move its executive offices within 50 miles of the Massapequa office. The parties
      acknowledge, however, that Executive may be required to travel in connection
      with the performance of his duties hereunder. 

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    

     

    4. Base
      Salary.
      For all
      services to be rendered by Executive pursuant to this Agreement, the Company
      agrees to pay Executive during the Employment Period an initial base salary
      (the
      "Base Salary") at an annual rate of $175,000. The Base Salary shall be paid
      in
      periodic installments in accordance with the Company's regular payroll
      practices. 

     

    The
      Compensation Committee (the “Compensation Committee”) of the Board (or by the
      independent members of the Board, if there is no Compensation Committee) shall
      review the Executive’s Base Salary annually after the conclusion of the initial
      two year term and shall make a recommendation to the Board as to whether such
      Base Salary should be increased but not decreased, which decision shall be
      within the Board’s sole discretion.

     

    5. Bonuses.
      During
      the term of this Agreement, the Executive shall be entitled to an annual bonus
      of $50,000 in the first year of employment, if the Company records gross
      revenues in excess of $5,000,000 in 2008. In addition, the Executive shall
      be
      entitled to an annual bonus of $75,000 in the second year of employment, if
      the
      Company records gross revenues in excess of $10,000,000 in 2009. Each annual
      bonus shall be paid by the Company to the Executive promptly after determination
      that the relevant targets have been met, it being understood that the attainment
      of any financial targets shall be determined after the results of the annual
      audit are known. 

     

    6. Expenses.
      Executive shall be entitled to prompt reimbursement by the Company for all
      reasonable ordinary and necessary travel, entertainment, and other expenses
      incurred by Executive while employed (in accordance with the policies and
      procedures established by the Company for its senior executive officers) in
      the
      performance of his duties and responsibilities under this Agreement; provided,
      that Executive shall properly account for such expenses in accordance with
      Company policies and procedures. In addition, Executive shall be paid a monthly
      car allowance of $750.

     

    7. Other
      Benefits.
      During
      the term of this Agreement, the Executive shall be eligible to participate
      in
      incentive, savings, retirement (401(k)), and welfare benefit plans, including,
      without limitation, health, medical, dental, vision, life (including accidental
      death and dismemberment) and disability insurance plans (collectively, "Benefit
      Plans"), in substantially the same manner and at substantially the same levels
      as the Company makes such opportunities available to the Company's managerial
      or
      salaried executive employees. The Company shall bear the sole cost of insuring
      Executive and his wife under the health, medical, dental and vision insurance
      plans.

     

    8. Vacation.
      During
      the term of this Agreement, the Executive shall be entitled to accrue, on a
      pro
      rata basis, 20 paid vacation days per year as well as February 15, 22 and 25,
      2008. Vacation shall be taken at such times as are mutually convenient to the
      Executive and the Company and no more than 10 consecutive days shall be taken
      at
      any one time without Company approval in advance. The Executive shall be
      entitled to carry over any accrued, unused vacation days from year to
      year.

     

    9. Stock
      Options.
      The
      Executive shall be eligible for such grants of awards under the Company’s 2007
      Equity Incentive Plan as the Compensation Committee or the Board may from time
      to time determine. Any such grants or awards of stock or stock options shall
      vest at the end of each year over the term of this Agreement. Any stock or
      stock
      options that have not yet vested if this Agreement is terminated shall be
      forfeit. 

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    

     

    10. Termination
      of Employment.
      

     

    (a) Death.
      If
      Executive dies during the Employment Period, this Agreement and the Executive’s
      employment with the Company shall automatically terminate and the Company shall
      have no further obligations to the Executive or his heirs, administrators or
      executors with respect to compensation and benefits accruing thereafter, except
      for the obligation to pay to the Executive’s heirs, administrators or executors
      any earned but unpaid Base Salary and vacation pay, unpaid pro
      rata
      annual
      bonus through the date of death and reimbursement of any and all reasonable
      expenses paid or incurred by the Executive in connection with and related to
      the
      performance of his duties and responsibilities for the Company during the period
      ending on the termination date. The Company shall deduct, from all payments
      made
      hereunder, all applicable taxes, including income tax, FICA and FUTA, and other
      appropriate deductions. In addition, the Executive’s spouse shall be entitled to
      continued coverage for a period of one year following the termination of
      employment, at the Company’s expense, under all health, medical, dental and
      vision insurance plans in which the Executive was a participant immediately
      prior to his last date of employment with the Company.

     

    (b) Disability.
      In the
      event that, during the term of this Agreement the Executive shall be prevented
      from performing his duties and responsibilities hereunder to the full extent
      required by the Company by reason of Disability (as defined below), this
      Agreement and the Executive’s employment with the Company shall automatically
      terminate and the Company shall have no further obligations or liability to
      the
      Executive or his heirs, administrators or executors with respect to compensation
      and benefits accruing thereafter, except for the obligation to pay the Executive
      or his heirs, administrators or executors any earned but unpaid Base Salary,
      unpaid pro
      rata
      annual
      bonus and unused vacation days accrued through the Executive’s last date of
      Employment with the Company and reimbursement of any and all reasonable expenses
      paid or incurred by the Executive in connection with and related to the
      performance of his duties and responsibilities for the Company during the period
      ending on the termination date. The Company shall deduct, from all payments
      made
      hereunder, all applicable taxes, including income tax, FICA and FUTA, and other
      appropriate deductions through the last date of the Executive’s employment with
      the Company. For purposes of this Agreement, “Disability”
shall
      mean a physical or mental disability that prevents the performance by the
      Executive, with reasonable accommodation, of his duties and responsibilities
      hereunder for a period of not less than an aggregate of three months during
      any
      twelve consecutive months.

     

    (c) Cause.

     

    (1)
      At
      any
      time during the Employment Period, the Company may terminate this Agreement
      and
      the Executive’s employment hereunder for Cause. For purposes of this Agreement,
“Cause” shall mean: (a) the willful and continued failure of the Executive to
      perform substantially his duties and responsibilities for the Company (other
      than any such failure resulting from Executive’s death or Disability) after a
      written demand by the Board for substantial performance is delivered to the
      Executive by the Company, which specifically identifies the manner in which
      the
      Board believes that the Executive has not substantially performed his duties
      and
      responsibilities, which willful and continued failure is not cured by the
      Executive within thirty (30) days of his receipt of such written demand or
      if
      such failure is not capable of being cured within said thirty days, then actions
      to cure the failure are not commenced with the said thirty days and if so
      commenced the failure is not cured within a reasonable time thereafter; (b)
      the
      conviction of, or plea of guilty or nolo
      contendere
      to, a
      felony, (c), violation of Sections 11 or 12 of this Agreement, or (d) fraud,
      dishonesty or gross misconduct which is materially and demonstratively injurious
      to the Company. Termination under clauses (b), (c) or (d) of this Section
      10(c)(1) shall not be subject to cure.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

     

    (2)
      Upon
      termination of this Agreement for Cause, the Company shall have no further
      obligations or liability to the Executive or his heirs, administrators or
      executors with respect to compensation and benefits thereafter, except for
      the
      obligation to pay the Executive any earned but unpaid Base Salary and vacation
      pay, and reimbursement of any and all reasonable expenses paid or incurred
      by
      the Executive in connection with and related to the performance of his duties
      and responsibilities for the Company during the period ending on the termination
      date. The Company shall deduct, from all payments made hereunder, all applicable
      taxes, including income tax, FICA and FUTA, and other appropriate
      deductions.

     

    (d) Change
      of Control.
      For
      purposes of this Agreement, “Change of Control” shall mean the occurrence of any
      one or more of the following: (i) the accumulation, whether directly,
      indirectly, beneficially or of record, by any individual, entity or group
      (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
      Act of 1934, as amended) of 50% or more of the shares of the outstanding Common
      Stock of the Company, whether by merger, consolidation, sale or other transfer
      of shares of Common Stock (other than a merger or consolidation where the
      stockholders of the Company prior to the merger or consolidation are the holders
      of a majority of the voting securities of the entity that survives such merger
      or consolidation), or (ii) a sale of all or substantially all of the assets
      of the Company, provided,
      however,
      that
      the following acquisitions shall not constitute a Change of Control for the
      purposes of this Agreement: (A) any acquisitions of Common Stock or securities
      convertible into Common Stock directly from the Company, or (B) any acquisition
      of Common Stock or securities convertible into Common Stock by any employee
      benefit plan (or related trust) sponsored by or maintained by the
      Company.

     

    (e) Good
      Reason.
      

     

    (1)
      At
      any
      time during the term of this Agreement, subject to the conditions set forth
      in
      Section 10(e)(2) below, the Executive may terminate this Agreement and the
      Executive’s employment with the Company for “Good Reason.” For purposes of this
      Agreement, “Good Reason” shall mean the occurrence of any of the following
      events: (A) the assignment, without the Executive’s consent, to the Executive of
      duties that are significantly different from, and that result in a substantial
      diminution of, the duties that he assumed on the Effective Date; (B) the
      assignment, without the Executive’s consent, to the Executive of a title that is
      different from and subordinate to the title Chief Financial Officer; (C) any
      termination of the Executive’s employment by the Company within 12 months after
      a Change of Control, other than a termination for Cause, death or Disability;
      or
      (D) material breach by the Company of this Agreement.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    

     

    (2)
      The
      Executive shall not be entitled to terminate this Agreement for Good Reason
      unless and until he shall have delivered written notice to the Company of his
      intention to terminate this Agreement and his employment with the Company for
      Good Reason, which notice specifies in reasonable detail the circumstances
      claimed to provide the basis for such termination for Good Reason, and the
      Company shall not have eliminated the circumstances constituting Good Reason
      within 30 days of its receipt from the Executive of such written
      notice.

     

    (3)
      In
      the
      event that the Executive terminates this Agreement and his employment with
      the
      Company for Good Reason, the Company shall pay or provide to the Executive
      (or,
      following his death, to the Executive’s heirs, administrators or executors): (A)
      any earned but unpaid Base Salary, unpaid pro
      rata
      annual
      bonus and unused vacation days accrued through the Executive’s last day of
      employment with the Company; (B) continued coverage, at the Company’s expense,
      under all Benefits Plans in which the Executive and his spouse was a participant
      immediately prior to his last date of employment with the Company, or, in the
      event that any such Benefit Plans do not permit coverage of the Executive or
      his
      spouse following Executive’s last date of employment with the Company, under
      benefit plans that provide no less coverage than such Benefit Plans, for a
      period of one year following the termination of employment; (C) reimbursement
      of
      any and all reasonable expenses paid or incurred by the Executive in connection
      with and related to the performance of his duties and responsibilities for
      the
      Company during the period ending on the termination date; and (D) the Base
      Salary, as in effect immediately prior to the Executive’s termination hereunder,
      and any bonuses earned, during the remainder of the Employment Period. All
      payments due hereunder shall be payable according to the Company’s standard
      payroll procedures. The Company shall deduct, from all payments made hereunder,
      all applicable taxes, including income tax, FICA and FUTA, and other appropriate
      deductions.

     

    (f) Without
      “Good Reason” by Executive or Without “Cause” by the Company.

     

    (1)
      By
      the
      Executive.
      At any
      time during the term of this Agreement, the Executive shall be entitled to
      terminate this Agreement and the Executive’s employment with the Company without
      Good Reason by providing prior written notice of at least 30 days to the
      Company. Upon termination by the Executive of this Agreement and the Executive’s
      employment with the Company without Good Reason, the Company shall have no
      further obligations or liability to the Executive or his heirs, administrators
      or executors with respect to compensation and benefits thereafter, except for
      the obligation to pay the Executive any earned but unpaid Base Salary, unused
      vacation days accrued through the Executive’s last day of employment with the
      Company and reimbursement of any and all reasonable expenses paid or incurred
      by
      the Executive in connection with and related to the performance of his duties
      and responsibilities for the Company during the period ending on the termination
      date. The Company shall deduct, from all payments made hereunder, all applicable
      taxes, including income tax, FICA and FUTA, and other appropriate
      deductions.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

     

    (2)
      By
      the
      Company.
      At any
      time during the term of this Agreement, the Company shall be entitled to
      terminate this Agreement and the Executive’s employment with the Company without
      Cause by providing prior written notice of at least 30 days to the Executive.
      Upon termination by the Company of this Agreement and the Executive’s employment
      with the Company without Cause, the Company shall pay or provide to the
      Executive (or, following his death, to the Executive’s heirs, administrators or
      executors): 

     

    
      	 	
              §

            	
              Any
                earned but unpaid Base Salary and any unpaid pro
                rata
                annual bonus and unused vacation days accrued through the Executive’s last
                day of employment with the Company;

            

    

     

    
      	 	
              §

            	
              Continued
                coverage, at the Company’s expense, under all Benefits Plans in which the
                Executive and his spouse was a participant immediately prior to
                Executive’s last date of employment with the Company, or, in the event
                that any such Benefit Plans do not permit coverage of the Executive
                and
                his spouse following Executive’s last date of employment with the Company,
                under benefit plans that provide no less coverage than such Benefit
                Plans,
                under the following schedule:

            

    

     

    
      	 	
              o

            	
              For
                a period of three months if the termination of employment occurs
                within
                the first ninety (90) days of this
                Agreement;

            

    

     

    
      	 	
              o

            	
              for
                a period of six months if the termination of employment occurs between
                the
                first ninety (90) days and the first one hundred eighty (180) days
                of this
                Agreement;

            

    

     

    
      	 	
              o

            	
              for
                a period of nine months if the termination of employment occurs between
                the first one hundred eighty (180) days and the first two hundred
                seventy
                (270) days of this Agreement;

            

    

     

    
      	 	
              o

            	
              and
                for a period of one year following the termination of employment,
                if it
                occurs after the two hundred seventy-first (271st)
                day of this Agreement; 

            

    

     

    
      	 	
              §

            	
              Reimbursement
                of any and all reasonable expenses paid or incurred by the Executive
                in
                connection with and related to the performance of his duties and
                responsibilities for the Company during the period ending on the
                termination date; and;

            

    

     

    
      	 	
              §

            	
              Severance
                pay based upon the Base Salary, as in effect immediately prior to
                the
                Executive’s termination hereunder, under the following
                Schedule:

            

    

     

    
      	 	
              o

            	
              Three
                months of Base Salary if the termination of employment occurs within
                the
                first ninety (90) days of this
                Agreement;

            

    

     

    
      	 	
              o

            	
              six
                months of Base Salary if the termination of employment occurs between
                the
                first ninety (90) days and the first one hundred eighty (180) days
                of this
                Agreement;

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

     

    
      	 	
              o

            	
              nine
                months of Base Salary if the termination of employment occurs between
                the
                first one hundred eighty (180) days and the first two hundred seventy
                (270) days of this Agreement;

            

    

     

    
      	 	
              o

            	
              the
                Base Salary and any bonuses earned during the remainder of the Employment
                Period, following the termination of employment, if it occurs after
                the
                two hundred seventy-first (271st)
                day of this Agreement; 

            

    

     

    All
      payments due hereunder shall be payable according to the Company’s standard
      payroll procedures. The Company shall deduct, from all payments made hereunder,
      all applicable taxes, including income tax, FICA and FUTA, and other appropriate
      deductions.

     

    11. Confidential
      Information.

     

    (a) Disclosure
      of Confidential Information.
      The
      Executive recognizes, acknowledges and agrees that he has had and will continue
      to have access to secret and confidential information regarding the Company,
      its
      subsidiaries and their respective businesses (“Confidential
      Information”),
      including but not limited to, its products, formulae, patents, sources of
      supply, customer dealings, data, know-how and business plans, provided such
      information is not in or does not hereafter become part of the public domain,
      or
      become known to others through no fault of the Executive. The Executive
      acknowledges that such information is of great value to the Company, is the
      sole
      property of the Company, and has been and will be acquired by him in confidence.
      In consideration of the obligations undertaken by the Company herein, the
      Executive will not, at any time, during or after his employment hereunder,
      reveal, divulge or make known to any person, any information acquired by the
      Executive during the course of his employment, which is treated as confidential
      by the Company, and not otherwise in the public domain. The provisions of this
      Section
      11
      shall
      survive the termination of the Executive’s employment hereunder.

     

    (b) The
      Executive affirms that he does not possess and will not rely upon the protected
      trade secrets or confidential or proprietary information of any prior
      employer(s) in providing services to the Company.

     

    (c) In
      the
      event that the Executive’s employment with the Company terminates for any
      reason, the Executive shall deliver forthwith to the Company any and all
      originals and copies, including those in electronic or digital formats, of
      Confidential Information.

     

    12. Non-Competition
      and Non-Solicitation.

     

    (a) The
      Executive agrees and acknowledges that the Confidential Information that the
      Executive has already received and will receive is valuable to the Company
      and
      that its protection and maintenance constitutes a legitimate business interest
      of the Company, to be protected by the non-competition restrictions set forth
      herein. The Executive agrees and acknowledges that the non-competition
      restrictions set forth herein are reasonable and necessary and do not impose
      undue hardship or burdens on the Executive. The Executive also acknowledges
      that
      the products and services developed or provided by the Company, its affiliates
      and/or its clients or customers are or are intended to be sold, provided,
      licensed and/or distributed to customers and clients in and throughout the
      United States (the “Territory”)
      (to
      the extent the Company comes to operate, either directly or through the
      engagement of a distributor or joint or co-venturer, or sell a significant
      amount of its products and services to customers located, in areas other than
      the United States during the term of the Employment Period, the definition
      of
      Territory shall be automatically expanded to cover such other areas), and that
      the Territory, scope of prohibited competition, and time duration set forth
      in
      the non-competition restrictions set forth below are reasonable and necessary
      to
      maintain the value of the Confidential Information of, and to protect the
      goodwill and other legitimate business interests of, the Company, its affiliates
      and/or its clients or customers.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    

     

    (b) The
      Executive hereby agrees and covenants that he shall not, without the prior
      written consent of the Company, directly or indirectly, in any capacity
      whatsoever, including, without limitation, as an employee, employer, consultant,
      principal, partner, shareholder, officer, director or any other individual
      or
      representative capacity (other than a holder of less than two percent (2%)
      of
      the outstanding voting shares of any publicly held company), or whether on
      the
      Executive's own behalf or on behalf of any other person or entity or otherwise
      howsoever, during the Employment Period and thereafter to the extent described
      below, within the Territory: 

     

    (1)
      Engage,
      own, manage, operate, control, be employed by, consult for, participate in,
      or
      be connected in any manner with the ownership, management, operation or control
      of any business in competition with the business of the Company;

     

    (2)
      Recruit,
      solicit or hire, or attempt to recruit, solicit or hire, any employee, or
      independent contractor of the Company to leave the employment (or independent
      contractor relationship) thereof, whether or not any such employee or
      independent contractor is party to an employment agreement;

     

    (3)
      Attempt
      in any manner to solicit or accept from any customer of the Company, with whom
      the Company had significant contact during Executive’s employment by the Company
      (whether under this Agreement or otherwise), business of the kind or competitive
      with the business done by the Company with such customer or to persuade or
      attempt to persuade any such customer to cease to do business or to reduce
      the
      amount of business which such customer has customarily done or might do with
      the
      Company, or if any such customer elects to move its business to a person other
      than the Company, provide any services (of the kind or competitive with the
      Business of the Company) for such customer, or have any discussions regarding
      any such service with such customer, on behalf of such other person;
      or

     

    (4)
      Interfere
      with any relationship, contractual or otherwise, between the Company and any
      other party, including, without limitation, any supplier, distributor,
      co-venturer or joint venturer of the Company to discontinue or reduce its
      business with the Company or otherwise in\terfere in any way with the Business
      of the Company. 

     

    With
      respect to the activities described in Paragraphs
      (2),
      (3)
      and
(4)
      above,
      the restrictions of this Section
      12(b)
      shall
      continue beyond the Employment Period until one year following the termination
      of this Agreement or of the Executive’s employment with the Company, whichever
      occurs later. Furthermore, if the Company terminates Executive’s employment for
      Cause or if Executive terminates his employment without Good Reason, then the
      restrictions of this Section
      12(b)
      shall
      continue with respect to the activities described in Paragraph
      (1),
      above,
      beyond the Employment Period until one year following the termination of this
      Agreement or of the Executive’s employment with the Company, whichever occurs
      later.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    

     

    13. Miscellaneous.

     

    (a) The
      Executive acknowledges that the services to be rendered by him under the
      provisions of this Agreement are of a special, unique and extraordinary
      character and that it would be difficult or impossible to replace such services.
      Furthermore, the parties acknowledge that monetary damages alone would not
      be an
      adequate remedy for any breach by the Executive of Section
      11
      or
Section 12
      of this
      Agreement. Accordingly, the Executive agrees that any breach or threatened
      breach by him of Section
      11
      or
Section 12
      of this
      Agreement shall entitle the Company, in addition to all other legal remedies
      available to it, to apply to any court of competent jurisdiction to seek to
      enjoin such breach or threatened breach. The parties understand and intend
      that
      each restriction agreed to by the Executive hereinabove shall be construed
      as
      separable and divisible from every other restriction, that the unenforceability
      of any restriction shall not limit the enforceability, in whole or in part,
      of
      any other restriction, and that one or more or all of such restrictions may
      be
      enforced in whole or in part as the circumstances warrant. In the event that
      any
      restriction in this Agreement is more restrictive than permitted by law in
      the
      jurisdiction in which the Company seeks enforcement thereof, such restriction
      shall be limited to the extent permitted by law. The remedy of injunctive relief
      herein set forth shall be in addition to, and not in lieu of, any other rights
      or remedies that the Company may have at law or in equity.

     

    (b) Neither
      the Executive nor the Company may assign or delegate any of their rights or
      duties under this Agreement without the express written consent of the other;
      provided,
      however,
      that
      the Company shall have the right to delegate its obligation of payment of all
      sums due to the Executive hereunder, provided that such delegation shall not
      relieve the Company of any of its obligations hereunder.

     

    (c) This
      Agreement constitutes and embodies the full and complete understanding and
      agreement of the parties with respect to the Executive’s employment by the
      Company, supersedes all prior understandings and agreements, whether oral or
      written, between the Executive and the Company, and shall not be amended,
      modified or changed except by an instrument in writing executed by the party
      to
      be charged. The invalidity or partial invalidity of one or more provisions
      of
      this Agreement shall not invalidate any other provision of this Agreement.
      No
      waiver by either party of any provision or condition to be performed shall
      be
      deemed a waiver of similar or dissimilar provisions or conditions at the same
      time or any prior or subsequent time.

     

    (d) This
      Agreement shall inure to the benefit of, be binding upon and enforceable
      against, the parties hereto and their respective successors, heirs,
      beneficiaries and permitted assigns.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    

     

    (e) The
      headings contained in this Agreement are for convenience of reference only
      and
      shall not affect in any way the meaning or interpretation of this
      Agreement.

     

    (f) All
      notices, requests, demands and other communications required or permitted to
      be
      given hereunder shall be in writing and shall be deemed to have been duly given
      when personally delivered, sent by registered or certified mail, return receipt
      requested, postage prepaid, or by reputable national overnight delivery service
      (e.g. Federal Express) for overnight delivery to the party at the address set
      forth in the preamble to this Agreement, or to such other address as either
      party may hereafter give the other party notice of in accordance with the
      provisions hereof. Notices shall be deemed given on the sooner of the date
      actually received or the third business day after deposited in the mail or
      one
      business day after deposited with an overnight delivery service for overnight
      delivery.

     

    (g) This
      Agreement shall be governed by and construed in accordance with the internal
      laws of the State of New York without reference to principles of conflicts
      of
      laws and each of the parties hereto irrevocably consents to the jurisdiction
      and
      venue of the federal and state courts located in the County and State of New
      York.

     

    (h) This
      Agreement may be executed simultaneously in two or more counterparts, each
      of
      which shall be deemed an original, but all of which together shall constitute
      one of the same instrument. The parties hereto have executed this Agreement
      as
      of the date set forth above.

     

    (i) The
      Executive represents and warrants to the Company, that he has the full power
      and
      authority to enter into this Agreement and to perform his obligations hereunder
      and that the execution and delivery of this Agreement and the performance of
      his
      obligations hereunder will not conflict with any agreement to which Executive
      is
      a party.

     

    

    [Signature
      page follows immediately]

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF, the Executive and the Company have caused this Executive
      Employment Agreement to be executed as of the date first above
      written.

    

    

    
      	 	
              ARTHUR
                L. GOLDBERG

            
	 	 	 
	 	 	 
	 	/s/
              Arthur L. Goldberg
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	
              CLEAR
                SKIES HOLDINGS, INC.

            
	 	 	 
	 	 	 
	 	
              By:

            	/s/
              Ezra J. Green
	 	 	
              Name:
                Ezra J. Green

            
	 	 	
              Title:
                Chairman & CEO

            

    

    

    

    

     

    
      
        
        

      

      
        11

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