Document:

lease

Property Lease

OF

GAS AND OIL TECHNOLOGIES, INC.

This Property Lease Agreement ("Agreement") is entered into as of the __________________ between Gas and Oil Technologies, Inc., ("Tenant") and Turnbey Property Management, ("Management").

General

The Management manages the premises known as 21280-21230 Erwin Street, Woodland Hills, CA 91367

The Tenant desires to rent the premises from the Management.

In consideration for the mutual promises, covenants, and Agreements made below, the parties, intending to be legally bound, agree as follows:

Agreement

1.Term. The term shall commence at __________________, and continue for a fixed term until ___________________, and thereafter on a month-to-month basis until either party shall terminate this contract pursuant to Section 28.

2.Rent. Tenant shall pay the minimum monthly rental of $24,400 (dollars) due in and payable on the first day of each and every month that occupancy is held. The Rent shall be paid to the Management or his authorized agent at the Management's current address or any other place designated by the Management. First month's rent is due prior to commencement of occupancy. In the event rent is not paid within 5 (Days) of the due date, Tenant agrees to pay a late charge of $________. The Management and the Tenant agree that the charge is presumed to be the damages sustained because of the Tenant s late payment of rent, and that it is extremely difficult to fix the actual damages. The late charge period is not a grace period, and the Management is entitled to make written demand for any rent unpaid on the second day after the due date.

3.Extra Storage Space. No additional storage space outside of premises is authorized, permitted, or provided unless herein specified:

5.Security Deposit. The Tenant shall pay $_________ in advance as a security deposit, prior to commencement of occupancy of premises, which shall insure the performance of the Tenant's obligations. The Tenant may not apply the security deposit, nor any portion of it to the last month's rent. The Management may, but is not obligated to, apply all portions of the deposit on account of the Tenant s rent or other obligations. If charges made upon termination of tenancy exceed the remaining security deposit held by the Management, the Tenant shall remain liable to the Management for these excess charges. If any portion of the security deposit is applied by the Management to any obligations of the Tenant at any time during the tenancy, the Tenant shall be liable, upon ________ (Days) written notice, to reinstate the full amount of the security deposit.

6.Payment by Check. If payment of rent is made by a check that is dishonored by the bank for any reason, the Tenant, in addition to late charges (if applicable), agrees to pay $__________ for each dishonored check, and subsequent rent payments, at the Management's option, shall be in a guaranteed form of payment.

7.Utilities. The Tenant shall pay for all the utilities and services for the premises except for the following utilities and services that shall be paid for by the Management______________ (List all utilities paid for by Management.) The Tenant agrees to pay for the cost of excessive use of water. Notwithstanding anything to the contrary, the Tenant shall pay the disposal cost of the Tenant's bulky, hazardous, or unusual refuse (including, but not limited to, discarded furniture, old carpets, cardboard cartons, solvents, paints, and old appliances).

8.Furnishings , Appliances and Floors. The Management shall provide the following furnishings and appliances: ___________ (i.e., Stove, refrigerator.) The Tenant acknowledges that any appliances and furnishings on the premises are in good condition and repair. The Tenant agrees to replace burned-out light bulbs, fluorescent tubes, and batteries of any smoke / fire detector(s) on the premises at the Tenant's expense, and to cover all hardwood floors on the premises with room sized rugs at the Tenant's expense.

9.Waterbeds. Waterbeds and / or liquid filled furniture on the premises are prohibited unless the Management consents in writing.

10.Installations and Other Objects. The Tenant shall not install nor operate any washing machines, clothes dryers, automatic dishwashers, deep-freeze units (or other such appliances), pianos, organs, or outside antennae on the premises without the Management's prior written consent. No plants, planters, or plant boxes may be placed on the floors, window ledges, or fire escapes. Bicycles and motor-driven cycles are not permitted on the premises, except in the following, and only the following, areas specifically designated for such: __________ (Designate area).

11.Occupants. Any persons staying more than 14 consecutive days or more than 30 days in any calendar year shall be considered Subtenants of the Tenant. The Tenant must inform the Management in writing of the presence of any subtenants within 30 days upon the occupancy of the premises of any such Subtenants. The premises may not be occupied by more than the maximum number of persons permitted by law.

12.Assignment and Subletting

12.1The Tenant shall not assign any portion of this Agreement. Notwithstanding the provisions of Section 11 above, the Tenant may only Sublet under this Agreement providing the following conditions are met:

12.2The total number of occupants does not exceed the number permitted by law.

12.3The Management is informed in writing prior to the Subletting and written consent to the Subletting is requested by the Tenant.

12.4Every prospective Sublettee completes and signs the Management's Rental Application Form, and delivers the completed and signed form to the Management.

12.5The Management gives written consent to the Subletting.

13.Physical Possession. If the Management is unable to deliver possession of the premises at the time agreed upon, the Management shall not be liable for any damage caused by that, nor shall this Agreement be void or voidable, but the Tenant shall not be liable for any rent until possession is delivered.

14.Individual Liability. Each Tenant shall be jointly and severally responsible for the full amount of the rent or other obligations under this Agreement.

15.Maintenance Repairs. The Tenant shall at the Tenant s expense and at all times maintain the premises and furnishings and appliances, if any, in a clean and good condition and shall surrender the same upon termination of this Agreement in as good condition as received (excepting normal wear and tear). The Tenant understands that the Tenant shall be responsible for repair of all damage including, but not limited to, walls, ceilings, doors, windows and coverings, glazing, floors and coverings, appliances, and plumbing (including stoppage) in and / or about the premises caused by the Tenant or the Tenant's guests.

16.Alterations. The Tenant shall not redecorate, paint, refinish floors, or otherwise alter the premises in any way without the prior written consent the Management. The Tenant shall not apply adhesive paper to any cabinets, walls, or doors on the premises, nor hang any plants, planters or lighting fixtures from the ceilings or walls of the premises. Nor shall the Tenant tack, nail, or glue any coverings to the floors.

17.Locks. The Tenant shall not change any lock or place additional locking devices upon any door or window of the premises without the prior written permission of the Management. In the event of any installation by the Tenant of a lock or locking device, the Tenant shall provide the Management with a key to any lock or locking device installed by the Tenant upon the premises within ___________(Hours) of any such installation.

18.Keys. Keys to the premises are the exclusive property of the Management. The Tenant shall not consign any keys to the premises to any other person without the Management's written consent. The Management's consent will not be unreasonably withheld. There shall be a minimum charge of $[x] for replacement of each lost key. In the event that any keys to the premises are lost or stolen, the Tenant shall be liable for the entire cost of all key and lock replacement, at the Management s discretion, as required for the security of the premises and building.

19.Roof. Use of the roof by the Tenant and guests is not permitted. Nor shall the Tenant or guests place any personal property (including planters, decking, chairs, tables) on the roof or any portion without the Management's prior written consent.

20.Pets. No pets, dogs, cats, birds, or other animals are allowed on or about the premises, excepting guide, service or signal dogs pursuant to state law. The Tenant shall not keep or otherwise harbor any animals. Despite the previous, the Tenant may keep the following, and only the following, specific, individual pets on the premises. ________ (Specify.) Pet(s) listed above shall be confined to the following areas: ___________ (Specify the area.)

21.Indemnification. The Management shall not be liable for any damages or injury to the Tenant, or any other person, or to any property, occurring on the premises or any part, or in common areas, unless such damage is the proximate result of the negligence or unlawful act of the Management, his agents, or his employees. The Tenant agrees to hold the Management harmless from any claims for damages, no matter how caused, except for injury or damages for which the Management is legally responsible.

22.Entry and Inspection. The Management shall have the right to enter the premises pursuant to state law: (1) In case of emergency, without prior notice. (2) To make necessary repairs, alterations, improvements, supply necessary or agreed services, exhibit the premises to prospective or actual purchasers, mortgagees, tenants, workmen, insurance agents, or contractors. (3) When Tenant has abandoned or surrendered the premises. Except under (1) and (3), entry may be made only during normal business hours and with a minimum of 24 hour notice.

23.Use. The premises are to be used exclusively for Property purposes only. No retail or other commercial use of premises is permitted.

24.Conduct. The Tenant shall not violate any City, State, or Federal Law in or about the premises, and the Tenant agrees to comply. There shall be no disturbing the peace or acts creating a nuisance or loud or unusual noises or intoxication in or about the premises at any time; no musical instruments shall be played between 10:00 p.m. and 10:00 a.m. on any day. Smoking or loud talking is not permitted at any time in the hallways. The Tenant agrees to keep the use of radio, television, and other electrically amplified audio equipment controlled so as not to disturb any other Tenant. The Tenant agrees to keep the premises safe and free of all perilous conditions. Furthermore, the Tenant agrees not to commit or permit in or about the premises any waste or to interfere with the quiet and peaceful enjoyment of other occupants of the premises. Any breach of these or any other conditions and covenants in this shall, at the Management s option, terminate tenancy as provided in Section 28 of this Agreement.

25.Damages to Premises. If the premises are so damaged by fire, flood, or from any other cause so as to render them untenantable, then either party shall have the right to terminate this Lease as of the date on which such damage occurs, through written notice to the other party, to be given within __________ (Days) after occurrence of such damage; except that should such damage or destruction occur as the result of the conduct or negligence of the Tenant, or the Tenant's guests then only the Management shall have the right to termination. Should this right be exercised by either party, then the rent for the current month shall be prorated between the parties as of the date of occurrence of the damage and any prepaid rent shall be refunded to the Tenant.

26.Moving. The Tenant shall hire a licensed moving company, at the Tenant s expense, to move the Tenant's large and / or heavy furnishings or appliances into or out of the building unless specified to the contrary. The Tenant shall notify the Management [x] (Hours) in advance of any moving of the Tenant's large and / or heavy furnishings or appliances into or out of the premises.

(Note: If the arithmetic sum of the overall length, width, and height of any single furnishing or appliance weighing in excess of 15 pounds. is a number greater than 72 inches, it shall be defined herein as "large." If the weight of any single furnishing or appliance is in excess of 50 pounds, it shall be defined herein as "heavy.")

27.Holdover. If this contract is for a fixed term, any holding over by the Tenant at the expiration of the fixed term shall create a month-to-month tenancy subject to all the terms and conditions of this contract.

28.Termination of Tenancy. Upon expiration of the Term set forth in Section 1, either the Management or the Tenant may terminate this contract by giving at least ________ (Day) written notice to the other party provided, however, that if the premises are subject to the Rent Control Ordinance at the time of termination, then the Management's right to terminate shall only be pursuant to the Rent Control Ordinance.

On termination, the Tenant shall: (1) completely vacate the premises and any parking or storage areas used by the Tenant: (2) deliver all keys, furnishings, if any, and premises to the Management in the same condition as received, excepting normal wear and tear; and (3) give written notice of the Tenant's forwarding address.

29.Waiver, Amendment, Modification. No waiver, amendment or modification of any provision of this Agreement will be effective unless in writing and signed by the party against whom such waiver, amendment or modification is sought to be enforced. No waiver by any party of any default in performance on the part of the other party under this Agreement or of any breach or series of breaches by the other party of any of the terms or conditions of this Agreement shall constitute a waiver of any subsequent default in performance under this Agreement or any subsequent breach of any terms or conditions. Performance of any obligation required of a party under this Agreement may be waived only by a written waiver signed by a duly authorized officer of the other party, which waiver shall be effective only with respect to the specific obligation described. The acceptance of rent by the Management shall not waive his right to enforce any term of this Agreement. Time is of the essence.

30.Cumulative Rights. Any specific right or remedy provided in this Agreement shall not be exclusive but shall be cumulative upon all other rights and remedies set forth in this Agreement and allowed under applicable law.

31.Governing Law. This Agreement shall be governed by the laws of the State of California applicable to Agreements made and fully performed in California.

32.Entire Agreement. The parties acknowledge that this Agreement expresses their entire understanding and Agreement, and that there have been no warranties, representations, covenants or understandings made by either party to the other except such as are expressly set forth. The parties further acknowledge that this Agreement supersedes, terminates and otherwise renders null and void any and all prior Agreements or contracts, whether written or oral, entered into between the Management and the Tenant with respect to the matters expressly set forth in this Agreement.

33.Counterparts. This Agreement may be executed in multiple counterparts, any one of which will be deemed an original, but all of which shall constitute one and the same instrument.

34.Attorney Fees. In the event that either party is required to retain the services of any attorney to enforce or otherwise litigate or defend any matter or claim arising out of or in connection with this Agreement, then the prevailing party shall be entitled to recover from the other party, in addition to any other relief awarded or granted, its reasonable costs and expenses (including attorneys' fees) incurred in the proceeding.

35.Compliance With Law. Both parties agree to comply with all applicable federal, state, and local laws and regulations in performing their duties.

36.Severability. In the event that any provision of this Agreement is found invalid or unenforceable pursuant to judicial decree or decision, the remainder shall remain valid and enforceable according to its terms. Without limiting the previous, it is expressly understood and agreed that each and every provision of this Agreement that provides for a limitation of liability, disclaimer of warranties, or exclusion of damages is intended by the parties to be severable and independent of any other provision and to be enforced as such. Further, it is expressly understood and agreed that in the event any remedy under this Agreement is determined to have failed of its essential purpose, all other limitations of liability and exclusion of damages set forth herein shall remain in full force and effect.

37.Notices. All notices, demands or consents required or permitted under this Agreement shall be in writing and shall be delivered or mailed certified with return receipt requested to the respective parties at the addresses set forth above or at some other address as such party shall specify to the other party in writing. Any notice required or permitted to be given by the provisions of this Agreement shall be conclusively deemed to have been received on the day it is delivered to that party by U.S. Mail with Acknowledgment of Receipt or by any commercial courier providing equivalent acknowledgment of receipt. The service of any notice on one Tenant shall be a service of all occupants.

Captions and section headings used in this Agreement are for convenience only and are not a part of this Agreement and shall not be used in construing it.

We have carefully reviewed this contract and agree to and accept its terms and conditions. We are executing this Agreement as of the day and year first written above. The Tenant(s) hereby acknowledge(s) receiving a copy of this Agreement.

Tenant(s):

___________________________________________Date:__________________

Signature

___________________________________________

Name

___________________________________________Date:__________________

Signature

___________________________________________

Name

___________________________________________Date:__________________

Signature

___________________________________________

Name

Management or Agent

___________________________________________Date:__________________

Signature

___________________________________________

By

___________________________________________

TitleExhibit 10

GAS AND OIL TECHNOLOGIES, INC.

2001 EMPLOYEE STOCK PURCHASE PLAN

As Adopted _______________, 2001 

1. Establishment of Plan. Gas and Oil Technologies, Inc. (the "Company") proposes to grant options for purchase of the Company's Common Stock to eligible employees of the Company and its Participating Subsidiaries (as hereinafter defined) pursuant to this Employee Stock Purchase Plan (this "Plan"). For purposes of this Plan, "Parent Corporation" and "Subsidiary" shall have the same meanings as "parent corporation" and "subsidiary corporation" in Sections 424(e) and 424(f), respectively, of the Internal Revenue Code of 1986, as amended (the "Code"). "Participating Subsidiaries" are Parent Corporations or Subsidiaries that the Board of Directors of the Company (the "Board") designates from time to time as corporations that shall participate in this Plan. The Company intends this Plan to qualify as an "employee stock purchase plan" under Section 423 of the Code (including any amendments to or replacements of such Section), and this Plan shall be so construed. Any term not expressly defined in this Plan but defined for purposes of Section 423 of the Code shall have the same definition herein. A total of 1,000,000 shares of the Company's Common Stock is reserved for issuance under this Plan. In addition, on each October 1, the aggregate number of shares of the Company's Common Stock reserved for issuance under the Plan shall be increased automatically by the number of shares which were purchased under the Plan in the preceding fiscal year; provided, that the Board or the Committee may in its sole discretion reduce the amount of the increase in any particular year; and, provided further, that the aggregate number of shares issued over the term of this Plan shall not exceed 20,000,000 shares. Such number shall be subject to adjustments effected in accordance with Section 14 of this Plan. 

 

2. Purpose. The purpose of this Plan is to provide eligible employees of the Company and Participating Subsidiaries with a convenient means of acquiring an equity interest in the Company through payroll deductions, to enhance such employees' sense of participation in the affairs of the Company and Participating Subsidiaries, and to provide an incentive for continued employment. 

3. Administration. This Plan shall be administered by the Compensation Committee of the Board (the "Committee"). Subject to the provisions of this Plan and the limitations of Section 423 of the Code or any successor provision in the Code, all questions of interpretation or application of this Plan shall be determined by the Committee and its decisions shall be final and binding upon all participants. Members of the Committee shall receive no compensation for their services in connection with the administration of this Plan, other than standard fees as established from time to time by the Board for services rendered by Board members serving on Board committees. All expenses incurred in connection with the administration of this Plan shall be paid by the Company. 

4. Eligibility. Any employee of the Company or the Participating Subsidiaries is eligible to participate in an Offering Period (as hereinafter defined) under this Plan except the following: 

(a) employees who are not employed by the Company or a Participating Subsidiary prior to the beginning of such Offering Period or prior to such other time period as specified by the Committee, except that employees who are employed on the Effective Date of the Registration Statement filed by the Company with the Securities and Exchange Commission ("SEC") under the Securities Act of 1933, as amended (the "Securities Act") registering the initial public offering of the Company's Common Stock shall be eligible to participate in the first Offering Period under the Plan; 

(b) employees who are customarily employed for twenty (20) hours or less per week; 

(c) employees who are customarily employed for five (5) months or less in a calendar year; 

(d) employees who, together with any other person whose stock would be attributed to such employee pursuant to Section 424(d) of the Code, own stock or hold options to purchase stock possessing five percent (5%) or more of the total combined voting power or value of all classes of stock of the Company or any of its Participating Subsidiaries or who, as a result of being granted an option under this Plan with respect to such Offering Period, would own stock or hold options to purchase stock possessing five percent (5%) or more of the total combined voting power or value of all classes of stock of the Company or any of its Participating Subsidiaries; and 

(e) individuals who provide services to the Company or any of its Participating Subsidiaries as independent contractors who are reclassified as common law employees for any reason except for federal income and employment tax purposes. 

5. Offering Dates. The offering periods of this Plan (each, an "Offering Period") shall be of twenty-four (24) months duration commencing on May 1 and November 1 of each year and ending on April 30 and October 31 of each year; provided, however, that the first such Offering Period shall commence on the first business day on which price quotations for the Company's stock are available on the Nasdaq National Market (the "First Offering Date") and shall end on October 31, 2003 (the "First Offering Period"). Except for the First Offering Period, each Offering Period shall consist of four (4) six month purchase periods (individually, a "Purchase Period") during which payroll deductions of the participants are accumulated under this Plan. The First Offering Period shall consist of no more than five and no fewer than three Purchase Periods, any of which may be greater or less than six months as determined by the Committee. The first business day of each Offering Period is referred to as the "Offering Date". The last business day of each Purchase Period is referred to as the "Purchase Date". The Committee shall have the power to change the Offering Dates, the Purchase Dates and the duration of Offering Periods or Purchase Periods without stockholder approval if such change is announced prior to the relevant Offering Period or prior to such other time period as specified by the Committee. 

6. Participation in this Plan. Eligible employees may become participants in an Offering Period under this Plan on the Offering Date after satisfying the eligibility requirements by delivering a subscription agreement to the Company prior to such Offering Date, or such other time period as specified by the Committee; provided, however, that all eligible employees employed on or before the First Offering Date will be automatically enrolled in the First Offering Period. Notwithstanding the foregoing, (i) an eligible employee may elect to decrease the number of shares of Common Stock that such employee would otherwise be permitted to purchase pursuant to Section 7 below for the First Offering Period and/or purchase shares of Common Stock for the First Offering Period through payroll deductions by delivering a subscription agreement to the Company within thirty (30) days following the First Offering Date after the filing of an effective registration statement pursuant to Form S-8 and (ii) the Committee may set a later time for filing the subscription agreement authorizing payroll deductions for all eligible employees with respect to a given Offering Period. Except as provided above with respect to the First Offering Period, an eligible employee who does not deliver a subscription agreement to the Company after becoming eligible to participate in an Offering Period shall not participate in that Offering Period or any subsequent Offering Period unless such employee enrolls in this Plan by filing a subscription agreement with the Company prior to such Offering Period, or such other time period as specified by the Committee. Once an employee becomes a participant in an Offering Period by filing a subscription agreement, such employee will automatically participate in the Offering Period commencing immediately following the last day of the prior Offering Period unless the employee withdraws or is deemed to withdraw from this Plan or terminates further participation in the Offering Period as set forth in Section 11 below. Such participant is not required to file any additional subscription agreement in order to continue participation in this Plan. 

7. Grant of Option on Enrollment. Enrollment by an eligible employee in this Plan with respect to an Offering Period will constitute the grant (as of the Offering Date) by the Company to such employee of an option to purchase on the Purchase Date up to that number of shares of Common Stock of the Company determined by a fraction, the numerator of which is the amount accumulated in such employee's payroll deduction account during such Purchase Period and the denominator of which is the lower of (i) eighty-five percent (85%) of the fair market value of a share of the Company's Common Stock on the Offering Date (but in no event less than the par value of a share of the Company's Common Stock), or (ii) eighty-five percent (85%) of the fair market value of a share of the Company's Common Stock on the Purchase Date (but in no event less than the par value of a share of the Company's Common Stock), provided, however, that for each Purchase Period within the First Offering Period the numerator shall be fifteen percent (10%) of the eligible employee's compensation for such Purchase Period, unless otherwise the employee elected to decrease the percentage of such employee's compensation, and provided, further, that the number of shares of the Company's Common Stock subject to any option granted pursuant to this Plan shall not exceed the lesser of (x) the maximum number of shares set by the Committee pursuant to Section 10(c) below with respect to the applicable Purchase Date, or (y) the maximum number of shares which may be purchased pursuant to Section 10(b) below with respect to the applicable Purchase Date. The fair market value of a share of the Company's Common Stock shall be determined as provided in Section 8 below. 

8. Purchase Price. The purchase price per share at which a share of Common Stock will be sold in any Offering Period shall be eighty-five percent (85%) of the lesser of: 

(a) the fair market value on the Offering Date; or 

(b) the fair market value on the Purchase Date. 

The term "fair market value" means, as of any date, the value of a share of the Company's Common Stock determined as follows: 

(a) if such Common Stock is then quoted on the Nasdaq National Market, its closing price on the Nasdaq National Market on the date of determination as reported in The Wall Street Journal; 

(b) if such Common Stock is publicly traded and is then listed on a national securities exchange, its closing price on the date of determination on the principal national securities exchange on which the Common Stock is listed or admitted to trading as reported in The Wall Street Journal; or 

(c) if such Common Stock is publicly traded but is not quoted on the Nasdaq National Market nor listed or admitted to trading on a national securities exchange, the average of the closing bid and asked prices on the date of determination as reported in The Wall Street Journal. 

Notwithstanding the foregoing, for purposes of the First Offering Date, fair market value shall be the price per share at which shares of the Company's Common Stock are initially offered for sale to the public by the Company's underwriters in the initial public offering of the Company's Common Stock pursuant to a registration statement filed with the SEC under the Securities Act. 

9. Payment Of Purchase Price; Changes In Payroll Deductions; Issuance Of Shares. 

(a) The purchase price of the shares is accumulated by regular payroll deductions made during each Offering Period, provided, however, that for the First Offering Period the purchase price of the shares shall be paid by the eligible employee in cash on each Purchase Date within the First Offering Period unless the eligible employee elects to purchase such shares through payroll deductions after the filing of an effective Form S-8 registration statement pursuant to the second sentence of Section 6 above within thirty (30) days following the First Offering Period. The deductions are made as a percentage of the participant's compensation in one percent (1%) increments not less than one percent (1%), nor greater than ten percent (10%) or such lower limit set by the Committee. Compensation shall mean all W-2 cash compensation, including, but not limited to, base salary, wages, commissions, overtime, shift premiums, plus draws against commissions; provided, however that compensation shall not include any bonuses or incentive compensation; further provided, however, that for purposes of determining a participant's compensation, any election by such participant to reduce his or her regular cash remuneration under Sections 125 or 401(k) of the Code shall be treated as if the participant did not make such election. Payroll deductions shall commence on the first payday of the Offering Period and shall continue to the end of the Offering Period unless sooner altered or terminated as provided in this Plan. 

(b) A participant may increase or decrease the rate of payroll deductions during an Offering Period by filing with the Company a new authorization for payroll deductions, in which case the new rate shall become effective for the next payroll period commencing after the Company's receipt of the authorization and shall continue for the remainder of the Offering Period unless changed as described below. Such change in the rate of payroll deductions may be made at any time during an Offering Period, but not more than one (1) change may be made effective during any Purchase Period. A participant may increase or decrease the rate of payroll deductions for any subsequent Offering Period by filing with the Company a new authorization for payroll deductions prior to the beginning of such Offering Period, or such other time period as specified by the Committee. 

(c) A participant may reduce his or her payroll deduction percentage to zero during an Offering Period by filing with the Company a request for cessation of payroll deductions. Such reduction shall be effective beginning with the next payroll period after the Company's receipt of the request and no further payroll deductions will be made for the duration of the Offering Period. Payroll deductions credited to the participant's account prior to the effective date of the request shall be used to purchase shares of Common Stock of the Company in accordance with Section (e) below. A participant may not resume making payroll deductions during the Offering Period in which he or she reduced his or her payroll deductions to zero. 

(d) All payroll deductions made for a participant are credited to his or her account under this Plan and are deposited with the general funds of the Company. No interest accrues on the payroll deductions. All payroll deductions received or held by the Company may be used by the Company for any corporate purpose, and the Company shall not be obligated to segregate such payroll deductions. 

(e) On each Purchase Date, so long as this Plan remains in effect and provided that the participant has not submitted a signed and completed withdrawal form before that date which notifies the Company that the participant wishes to withdraw from that Offering Period under this Plan and have all payroll deductions accumulated in the account maintained on behalf of the participant as of that date returned to the participant, the Company shall apply the funds then in the participant's account to the purchase of whole shares of Common Stock reserved under the option granted to such participant with respect to the Offering Period to the extent that such option is exercisable on the Purchase Date. The purchase price per share shall be as specified in Section 8 of this Plan. Any cash remaining in a participant's account after such purchase of shares shall be refunded to such participant in cash, without interest; provided, however, that any amount remaining in such participant's account on a Purchase Date which is less than the amount necessary to purchase a full share of Common Stock of the Company shall be carried forward, without interest, into the next Purchase Period or Offering Period, as the case may be. In the event that this Plan has been oversubscribed, all funds not used to purchase shares on the Purchase Date shall be returned to the participant, without interest. No Common Stock shall be purchased on a Purchase Date on behalf of any employee whose participation in this Plan has terminated prior to such Purchase Date. 

(f) As promptly as practicable after the Purchase Date, the Company shall issue shares for the participant's benefit representing the shares purchased upon exercise of his or her option. 

(g) During a participant's lifetime, his or her option to purchase shares hereunder is exercisable only by him or her. The participant will have no interest or voting right in shares covered by his or her option until such option has been exercised. 

10. Limitations on Shares to be Purchased. 

(a) No participant shall be entitled to purchase stock under this Plan at a rate which, when aggregated with his or her rights to purchase stock under all other employee stock purchase plans of the Company or any Subsidiary, exceeds $25,000 in fair market value, determined as of the Offering Date (or such other limit as may be imposed by the Code) for each calendar year in which the employee participates in this Plan. The Company shall automatically suspend the payroll deductions of any participant as necessary to enforce such limit provided that when the Company automatically resumes such payroll deductions, the Company must apply the rate in effect immediately prior to such suspension. 

(b) No participant shall be entitled to purchase more than the Maximum Share Amount (as defined below) on any single Purchase Date. Prior to the commencement of any Offering Period or prior to such time period as specified by the Committee, the Committee may, in its sole discretion, set a maximum number of shares which may be purchased by any employee at any single Purchase Date (hereinafter the "Maximum Share Amount"). The Maximum Share Amount shall be 2,000 shares. If a new Maximum Share Amount is set, then all participants must be notified of such Maximum Share Amount prior to the commencement of the next Offering Period. The Maximum Share Amount shall continue to apply with respect to all succeeding Purchase Dates and Offering Periods unless revised by the Committee as set forth above. 

(c) If the number of shares to be purchased on a Purchase Date by all employees participating in this Plan exceeds the number of shares then available for issuance under this Plan, then the Company will make a pro rata allocation of the remaining shares in as uniform a manner as shall be reasonably practicable and as the Committee shall determine to be equitable. In such event, the Company shall give written notice of such reduction of the number of shares to be purchased under a participant's option to each participant affected. 

(d) Any payroll deductions accumulated in a participant's account which are not used to purchase stock due to the limitations in this Section 10 shall be returned to the participant as soon as practicable after the end of the applicable Purchase Period, without interest. 

11. Withdrawal. 

(a) Each participant may withdraw from an Offering Period under this Plan by signing and delivering to the Company a written notice to that effect on a form provided for such purpose. Such withdrawal may be elected at any time prior to the end of an Offering Period, or such other time period as specified by the Committee. 

(b) Upon withdrawal from this Plan, the accumulated payroll deductions shall be returned to the withdrawn participant, without interest, and his or her interest in this Plan shall terminate. In the event a participant voluntarily elects to withdraw from this Plan, he or she may not resume his or her participation in this Plan during the same Offering Period, but he or she may participate in any Offering Period under this Plan which commences on a date subsequent to such withdrawal by filing a new authorization for payroll deductions in the same manner as set forth in Section 6 above for initial participation in this Plan. 

(c) If the Fair Market Value on the first day of the current Offering Period in which a participant is enrolled is higher than the Fair Market Value on the first day of any subsequent Offering Period, the Company will automatically enroll such participant in the subsequent Offering Period. Any funds accumulated in a participant's account prior to the first day of such subsequent Offering Period will be applied to the purchase of shares on the Purchase Date immediately prior to the first day of such subsequent Offering Period, if any. 

12. Termination of Employment. Termination of a participant's employment for any reason, including retirement, death or the failure of a participant to remain an eligible employee of the Company or of a Participating Subsidiary, immediately terminates his or her participation in this Plan. In such event, the payroll deductions credited to the participant's account will be returned to him or her or, in the case of his or her death, to his or her legal representative, without interest. For purposes of this Section 12, an employee will not be deemed to have terminated employment or failed to remain in the continuous employ of the Company or of a Participating Subsidiary in the case of sick leave, military leave, or any other leave of absence approved by the Board; provided that such leave is for a period of not more than ninety (90) days or reemployment upon the expiration of such leave is guaranteed by contract or statute. 

13. Return of Payroll Deductions. In the event a participant's interest in this Plan is terminated by withdrawal, termination of employment or otherwise, or in the event this Plan is terminated by the Board, the Company shall deliver to the participant all payroll deductions credited to such participant's account. No interest shall accrue on the payroll deductions of a participant in this Plan. 

14. Capital Changes. Subject to any required action by the stockholders of the Company, the number and type of shares of Common Stock covered by each option under this Plan which has not yet been exercised and the number and type of shares of Common Stock which have been authorized for issuance under this Plan but have not yet been placed under option (collectively, the "Reserves"), as well as the price per share of Common Stock covered by each option under this Plan which has not yet been exercised, shall be proportionately adjusted for any increase or decrease in the number of issued and outstanding shares of Common Stock of the Company resulting from a stock split or the payment of a stock dividend (but only on the Common Stock), any other increase or decrease in the number of issued and outstanding shares of Common Stock effected without receipt of any consideration by the Company or other change in the corporate structure or capitalization affecting the Company's present Common Stock; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been "effected without receipt of consideration". Such adjustment shall be made by the Committee, whose determination shall be final, binding and conclusive. Except as expressly provided herein, no issue 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 an option. 

In the event of the proposed dissolution or liquidation of the Company, the Offering Period will terminate immediately prior to the consummation of such proposed action, unless otherwise provided by the Committee. The Committee may, in the exercise of its sole discretion in such instances, declare that this Plan shall terminate as of a date fixed by the Committee and give each participant the right to purchase shares under this Plan prior to such termination. In the event of (i) a merger or consolidation in which the Company is not the surviving corporation (other than a merger or consolidation with a wholly-owned subsidiary, a reincorporation of the Company in a different jurisdiction, or other transaction in which there is no substantial change in the stockholders of the Company or their relative stock holdings and the options under this Plan are assumed, converted or replaced by the successor corporation, which assumption will be binding on all participants), (ii) a merger in which the Company is the surviving corporation but after which the stockholders of the Company immediately prior to such merger (other than any stockholder that merges, or which owns or controls another corporation that merges, with the Company in such merger) cease to own their shares or other equity interest in the Company, (iii) the sale of all or substantially all of the assets of the Company or (iv) the acquisition, sale, or transfer of more than 50% of the outstanding shares of the Company by tender offer or similar transaction, the Plan will continue with regard to Offering Periods that commenced prior to the closing of the proposed transaction and shares will be purchased based on the Fair Market Value of the surviving corporation's stock on each Purchase Date, unless otherwise provided by the Committee. 

The Committee may, if it so determines in the exercise of its sole discretion, also make provision for adjusting the Reserves, as well as the price per share of Common Stock covered by each outstanding option, in the event that the Company effects one or more reorganizations, recapitalizations, rights offerings or other increases or reductions of shares of its outstanding Common Stock, or in the event of the Company being consolidated with or merged into any other corporation. 

15. Nonassignability. Neither payroll deductions credited to a participant's account nor any rights with regard to the exercise of an option or to receive shares under this Plan may be assigned, transferred, pledged or otherwise disposed of in any way (other than by will, the laws of descent and distribution or as provided in Section 22 below) by the participant. Any such attempt at assignment, transfer, pledge or other disposition shall be void and without effect. 

16. Reports. Individual accounts will be maintained for each participant in this Plan. Each participant shall receive promptly after the end of each Purchase Period a report of his or her account setting forth the total payroll deductions accumulated, the number of shares purchased, the per share price thereof and the remaining cash balance, if any, carried forward to the next Purchase Period or Offering Period, as the case may be. 

17. Notice of Disposition. Each participant shall notify the Company in writing if the participant disposes of any of the shares purchased in any Offering Period pursuant to this Plan if such disposition occurs within two (2) years from the Offering Date or within one (1) year from the Purchase Date on which such shares were purchased (the "Notice Period"). The Company may, at any time during the Notice Period, place a legend or legends on any certificate representing shares acquired pursuant to this Plan requesting the Company's transfer agent to notify the Company of any transfer of the shares. The obligation of the participant to provide such notice shall continue notwithstanding the placement of any such legend on the certificates. 

18. No Rights to Continued Employment. Neither this Plan nor the grant of any option hereunder shall confer any right on any employee to remain in the employ of the Company or any Participating Subsidiary, or restrict the right of the Company or any Participating Subsidiary to terminate such employee's employment. 

19. Equal Rights And Privileges. All eligible employees shall have equal rights and privileges with respect to this Plan so that this Plan qualifies as an "employee stock purchase plan" within the meaning of Section 423 or any successor provision of the Code and the related regulations. Any provision of this Plan which is inconsistent with Section 423 or any successor provision of the Code shall, without further act or amendment by the Company, the Committee or the Board, be reformed to comply with the requirements of Section 423. This Section 19 shall take precedence over all other provisions in this Plan. 

20. Notices. All notices or other communications by a participant to the Company under or in connection with this Plan shall be deemed to have been duly given when received in the form specified by the Company at the location, or by the person, designated by the Company for the receipt thereof. 

21. Term; Stockholder Approval. After this Plan is adopted by the Board, this Plan will become effective on the First Offering Date (as defined above). This Plan shall be approved by the stockholders of the Company, in any manner permitted by applicable corporate law, within twelve (12) months before or after the date this Plan is adopted by the Board. No purchase of shares pursuant to this Plan shall occur prior to such stockholder approval. This Plan shall continue until the earlier to occur of (a) termination of this Plan by the Board (which termination may be effected by the Board at any time), (b) issuance of all of the shares of Common Stock reserved for issuance under this Plan, or (c) ten (10) years from the adoption of this Plan by the Board. 

22. Designation of Beneficiary. 

(a) A participant may file a written designation of a beneficiary who is to receive any shares and cash, if any, from the participant's account under this Plan in the event of such participant's death subsequent to the end of an Purchase Period but prior to delivery to him of such shares and cash. In addition, a participant may file a written designation of a beneficiary who is to receive any cash from the participant's account under this Plan in the event of such participant's death prior to a Purchase Date. 

(b) Such designation of beneficiary may be changed by the participant at any time by written notice. In the event of the death of a participant and in the absence of a beneficiary validly designated under this Plan who is living at the time of such participant's death, the Company shall deliver such shares or cash to the executor or administrator of the estate of the participant, or if no such executor or administrator has been appointed (to the knowledge of the Company), the Company, in its discretion, may deliver such shares or cash to the spouse or to any one or more dependents or relatives of the participant, or if no spouse, dependent or relative is known to the Company, then to such other person as the Company may designate. 

23. Conditions Upon Issuance of Shares; Limitation on Sale of Shares. Shares shall not be issued with respect to an option unless the exercise of such option and the issuance and delivery of such shares pursuant thereto shall comply with all applicable provisions of law, domestic or foreign, including, without limitation, the Securities Act, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, and the requirements of any stock exchange or automated quotation system upon which the shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance. 

24. Applicable Law. The Plan shall be governed by the substantive laws (excluding the conflict of laws rules) of the State of California. 

25. Amendment or Termination of this Plan. The Board may at any time amend, terminate or extend the term of this Plan, except that any such termination cannot affect options previously granted under this Plan, nor may any amendment make any change in an option previously granted which would adversely affect the right of any participant, nor may any amendment be made without approval of the stockholders of the Company obtained in accordance with Section 21 above within twelve (12) months of the adoption of such amendment (or earlier if required by Section 21) if such amendment would: 

(a) increase the number of shares that may be issued under this Plan; or 

(b) change the designation of the employees (or class of employees) eligible for participation in this Plan. 

Notwithstanding the foregoing, the Board may make such amendments to the Plan as the Board determines to be advisable, if the continuation of the Plan or any Offering Period would result in financial accounting treatment for the Plan that is different from the financial accounting treatment in effect on the date this Plan is adopted by the Board.

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