Document:

Attachment
A

     

    Scope
of Services

     

    
      	
              A.

            	
              General
      Services - Consultant will provide accounting, bookkeeping, and
      financial support services to ASFX and its subsidiaries with regard to
      day-to-day business operations in accordance with generally accepted
      industry standards.

            

    

     

    
      	
              B.

            	
              Month/Quarterly
      Financials - Consultant will provide ASFX with month-end and/or
      quarter-end closing of financial accounting books and
      records,  including but not limited
  to:

            

    

    
      	
               
      

            	
              1.

            	
              General
      Ledger (GL) accounts
analysis/reconciliation.

            

    

    
      	
               
      

            	
              2.

            	
              Reconcile
      current inventory and oversee maintenance of accurate inventory
      reporting.

            

    

    
      	
               
      

            	
              3.

            	
              Prepare
      and/or review bank reconciliations.

            

    

    
      	
               
      

            	
              4.

            	
              Maintain
      spreadsheet of investment
activities.

            

    

    
      	
               
      

            	
              5.

            	
              Prepare
      FAS123R calculations for stock based
  compensation.

            

    

    
      	
               
      

            	
              6.

            	
              Journal
      Entries (JE).

            

    

    
      	
               
      

            	
              7.

            	
              Research
      and analyze U.S. GAAP standards, rules, and guidance when necessary to
      assure ASFX’s compliance.

            

    

    
      	
               
      

            	
              8.

            	
              Prepare
      financial statements (Consolidated Balance Sheets (BS), Income Statements
      (IS) and Cash Flows (CF)) in accordance with U.S.
  GAAP.

            

    

    
      	
               
      

            	
              9.

            	
              Quarterly
      flux analysis.

            

    

    
      	
               
      

            	
              10.

            	
              Prepare
      and provide all supporting schedules of accounts as required by external
      financial auditors.

            

    

    
      	
               
      

            	
              11.

            	
              Provide
      other documents and items as required by external financial
      auditors.

            

    

    
      	
               
      

            	
              12.

            	
              Act
      as liaison with ASFX’s external financial audit firm(s) to facilitate
      quarterly financial reviews.

            

    

    
      	
               
      

            	
              13.

            	
              Record
      any post financial audit adjustments as
  appropriate.

            

    

     

    
      	
              C.

            	
              Year
      End Financials - Consultant will provide ASFX with year-end closing
      of financial accounting books and records, including but not limited
      to:

            

    

    
      	
               
      

            	
              1.

            	
              Prepare
      year-end financial statements (Consolidated BS, IS and Cash flows
      including full footnote disclosure, in accordance with U.S.
      GAAP)

            

    

    
      	
               
      

            	
              2.

            	
              Prepare
      and provide all supporting schedules of accounts for year-end financial
      audit(s)

            

    

    
      	
               
      

            	
              3.

            	
              Provide
      other documents and items as required by external auditors to complete the
      year-end financial audit(s).

            

    

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
              4.

            	
              Act
      as liaison with external audit firm to facilitate the annual financial
      audit.

            

    

    
      	
               
      

            	
              5.

            	
              Provide
      guidance and assistance to the executive team with regard to the issuance
      of 1099’s, etc.

            

    

     

    
      	
              D.

            	
              Securities
      and Exchange (SEC) Reports – Consultant will prepare of SEC reports
      such     as 10-Q and
  10-K

            

    

     

    
      	
              E.

            	
              Deliverables
      -
      Consultant will deliver to ASFX the following
  items;

            

    

     

    1.
Quarterly Consolidated Financial statements which include:

    A.
Balance Sheets (BS),

    B.  Income
Statements (IS)

    C.
Statements of Cash Flow (CF))

    2.  Quarterly
flux analysis.

    3.  All
supporting schedules of accounts as required by external financial
auditors.

    4.  Provide
other documents and items as required by external financial
auditors.

    5.  Record
any post financial audit adjustments as appropriate.

    6.  Consolidated
Year-end financial statements

               A.
Balance Sheets (BS),

    B.  Income
Statements (IS)

    C.  Statements
of Cash Flow including full footnote disclosure

    7.  Provide
all year end supporting schedules of accounts for year-end financial
audit(s)

    8.  Provide
other year end documents and items as required by external auditors to
complete
the year-end financial audit(s).

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    Attachment
B

     

    Pricing
Rates

     

    
      	
              A.

            	
              General

            

    

     

    
      	
               
      

            	
              1.

            	
              Pricing
      and hourly rates for Consultant are for the Scope of Services as
      stipulated in Attachment A and shall be incorporated
    thereto.

            

    

     

    
      	
               
      

            	
              2.

            	
              Consultant
      reserves the right to re-price rates for additional work as may be
      requested by ASFX that is outside of the work specified in the Scope of
      Services contained within Attachment
A.

            

    

     

    
      	
              B.

            	
              Rates

            

    

     

    
      	
               
      

            	
              1.

            	
              Consultant’s
      hourly rate (“Rate”) shall be ninety-five dollars ($95.00) per hour for
      each hour of service rendered.

            

    

     

    
      	
               
      

            	
              2.

            	
              Partial
      hours shall be billed in increments of at least one quarter hours (.25
      hours).

            

    

     

    
      	
               
      

            	
              3.

            	
              Consultant
      may adjust the Rate for the use of subcontractors as may be required from
      time to time by ASFX. Consultant and ASFX will agree to the fee prior to
      engaging outside subcontractors if the rate exceeds the Rate of
      consultant.

            

    

     

    
      
         

      

      
        3AMERICAN
SCIENTIFIC RESOURCES, INCORPORATED

    2006
STOCK OPTION PLAN

     

      
        

      

    

    

    1.           Purpose.  The
purpose of this Plan is to advance the interests of AMERICAN SCIENTIFIC
RESOURCES, INCORPORATED, a Nevada corporation (the “Company”), by providing an
additional incentive to attract, retain and motivate highly qualified and
competent persons who are key to the Company, including key employees,
consultants, independent contractors, Officers and Directors, and upon whose
efforts and judgment the success of the Company and its Subsidiaries is largely
dependent, by authorizing the grant of options to purchase Common Stock of the
Company and other related benefits to persons who are eligible to participate
hereunder, thereby encouraging stock ownership in the Company by such persons,
all upon and subject to the terms and conditions of this Plan.

    

    2.           Definitions.  As
used herein, the following terms shall have the meanings indicated:

    (a)           “Board”
shall mean the Board of Directors of the Company.

    

    (b)           “Cause”
shall mean any of the following:

    

    (i)           a
determination by the Company that there has been a willful, reckless or grossly
negligent failure by the Optionee to perform his or her duties as an employee of
the Company;

    

    (ii)           a
determination by the Company that there has been a willful breach by the
Optionee of any of the material terms or provisions of any employment agreement
between such Optionee and the Company;

    

    (iii)           any
conduct by the Optionee that either results in his or her conviction of a felony
under the laws of the United States of America or any state thereof, or of an
equivalent crime under the laws of any other jurisdiction;

    

    (iv)           a
determination by the Company that the Optionee has committed an act or acts
involving fraud, embezzlement, misappropriation, theft, breach of fiduciary duty
or material dishonesty against the Company, its properties or
personnel;

    

    (v)           any
act by the Optionee that the Company determines to be in willful or wanton
disregard of the Company’s best interests, or which results, or is intended to
result, directly or indirectly, in improper gain or personal enrichment of the
Optionee at the expense of the Company;

    

    (vi)           a
determination by the Company that there has been a willful, reckless or grossly
negligent failure by the Optionee to comply with any rules, regulations,
policies or procedures of the Company, or that the Optionee has engaged in any
act, behavior or conduct demonstrating a deliberate and material violation or
disregard of standards of behavior that the Company has a right to expect of its
employees; or

    

    (vii)           if
the Optionee, while employed by the Company and for two years thereafter,
violates a confidentiality and/or noncompete agreement with the Company, or
fails to safeguard, divulges, communicates, uses to the detriment of the Company
or for the benefit of any person or persons, or misuses in any way, any
Confidential Information; provided, however, that, if
the Optionee has entered into a written employment agreement with the Company
which remains effective and which expressly provides for a termination of such
Optionee’s employment for “cause,” the term “Cause” as used herein shall have
the meaning as set forth in the Optionee’s employment agreement in lieu of the
definition of “Cause” set forth in this Section 2(b).

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    (c)           “Change
of Control” shall mean the acquisition by any person or group (as that term is
defined in the Exchange Act, and the rules promulgated pursuant to that act) in
a single transaction or a series of transactions of thirty percent (30%) or more
in voting power of the outstanding stock of the Company and a change of the
composition of the Board of Directors so that, within two years after the
acquisition took place, a majority of the members of the Board of Directors of
the Company, or of any corporation with which the Company may be consolidated or
merged, are persons who were not directors or officers of the Company or one of
its Subsidiaries immediately prior to the acquisition, or to the first of a
series of transactions which resulted in the acquisition of thirty percent (30%)
or more in voting power of the outstanding stock of the Company.

    

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

    

    (e)           “Committee”
shall mean the stock option committee appointed by the Board or, if not
appointed, the Board.

    

    (f)           “Common
Stock” shall mean the Company’s Common Stock, par value $.001 per
share.

    

    (g)           “Director”
shall mean a member of the Board.

    

    (h)           “Employee”
shall mean any person, including officers, directors, consultants and
independent contractors employed by the Company or any parent or Subsidiary of
the Company within the meaning of Section 3401(c) of the regulators promulgated
thereunder.

    

    (i)           “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.

    

    (j)           “Fair
Market Value” of a Share on any date of reference shall be the Closing Price of
a share of Common Stock on the business day immediately preceding such date,
unless the Committee in its sole discretion shall determine otherwise in a fair
and uniform manner.  For this purpose, the “Closing Price” of the
Common Stock on any business day shall be (i) if the Common Stock is listed or
admitted for trading on any United States national securities exchange, or if
actual transactions are otherwise reported on a consolidated transaction
reporting system, the last reported sale price of the Common Stock on such
exchange or reporting system, as reported in any newspaper of general
circulation, (ii) if the Common Stock is quoted on The Nasdaq Stock Market
(“Nasdaq”), or any similar system of automated dissemination of quotations of
securities prices in common use, the mean between the closing high bid and low
asked quotations for such day of the Common Stock on such system, or
(iii) if neither clause (i) nor (ii) is applicable, the mean between the
high bid and low asked quotations for the Common Stock as reported by the
National Quotation Bureau, Incorporated if at least two securities dealers have
inserted both bid and asked quotations for the Common Stock on at least five of
the 10 preceding days.  If the information set forth in
clauses (i) through (iii) above is unavailable or inapplicable to the
Company (e.g., if the Company’s Common Stock is not then publicly traded or
quoted), then the “Fair Market Value” of a Share shall be the fair market value
(i.e., the price at which a willing seller would sell a Share to a willing buyer
when neither is acting under compulsion and when both have reasonable knowledge
of all relevant facts) of a share of the Common Stock on the business day
immediately preceding such date as the Committee in its sole and absolute
discretion shall determine in a fair and uniform manner.

    

    (k)           “Incentive
Stock Option” shall mean an incentive stock option as defined in Section 422 of
the Code.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    (l)      
      “Non-Statutory Stock Option” or
“Nonqualified Stock Option” shall mean an Option which is not an Incentive Stock
Option.

    

    (m)           “Officer”
shall mean the Company’s chairman, president, principal financial officer,
principal accounting officer (or, if there is no such accounting officer, the
controller), any vice-president of the Company in charge of a principal business
unit, division or function (such as sales, administration or finance), any other
officer who performs a policy-making function, or any other person who performs
similar policy-making functions for the Company.  Officers of
Subsidiaries shall be deemed Officers of the Company if they perform such
policy-making functions for the Company.  As used in this paragraph,
the phrase “policy-making function” does not include policy-making functions
that are not significant.  Unless specified otherwise in a resolution
by the Board, an “executive officer” pursuant to Item 401(b) of Regulation S-K
(17 C.F.R. § 229.401(b)) shall be only such person designated as an “Officer”
pursuant to the foregoing provisions of this paragraph.

    

    (n)           “Option”
(when capitalized) shall mean any stock option granted under this
Plan.

    

    (o)           “Optionee”
shall mean a person to whom an Option is granted under this Plan or any person
who succeeds to the rights of such person under this Plan by reason of the death
of such person.

    

    (p)           “Plan”
shall mean this 2006 Stock Option Plan of the Company, which Plan shall be
effective upon approval by the Board, subject to approval, within 12 months of
the date thereof by holders of a majority of the Company’s issued and
outstanding Common Stock of the Company.

    

    (q)           “Share”
or “Shares” shall mean a share or shares, as the case may be, of the Common
Stock, as adjusted in accordance with Section 10 of this Plan.

    

    (r)           “Subsidiary”
shall mean any corporation (other than the Company) in any unbroken chain of
corporations beginning with the Company if, at the time of the granting of the
Option, each of the corporations other than the last corporation in the unbroken
chain owns stock possessing 50 percent or more of the total combined voting
power of all classes of stock in one of the other corporations in such
chain.

    

    3.           Shares and
Options.  Subject to adjustment in accordance with Section 10
hereof, the Company may issue up to three million (3,000,000) Shares from Shares
held in the Company’s treasury or from authorized and unissued Shares through
the exercise of Options issued pursuant to the provisions of this
Plan.  If any Option granted under this Plan shall terminate, expire,
or be canceled, forfeited or surrendered as to any Shares, the Shares relating
to such lapsed Option shall be available for issuance pursuant to new Options
subsequently granted under this Plan.  Upon the grant of any Option
hereunder, the authorized and unissued Shares to which such Option relates shall
be reserved for issuance to permit exercise under this Plan.  Subject
to the provisions of Section 14 hereof, an Option granted hereunder shall be
either an Incentive Stock Option or a Non-Statutory Stock Option as determined
by the Committee at the time of grant of such Option and shall clearly state
whether it is an Incentive Stock Option or Non-Statutory Stock
Option.  All Incentive Stock Options shall be granted within 10 years
from the effective date of this Plan.

    

    4.           Limitations.  Options
otherwise qualifying as Incentive Stock Options hereunder will not be treated as
Incentive Stock Options to the extent that the aggregate Fair Market Value
(determined at the time the Option is granted) of the Shares, with respect to
which Options meeting the requirements of Code Section 422(b) are
exercisable for the first time by any individual during any calendar year (under
all stock option or similar plans of the Company and any Subsidiary), exceeds
$100,000.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    5.           Conditions for Grant of
Options.

    

    (a)           Each
Option shall be evidenced by an option agreement that may contain any term
deemed necessary or desirable by the Committee, provided such terms are not
inconsistent with this Plan or any applicable law.  Optionees shall be
those persons selected by the Committee from the class of all regular Employees
of the Company or its Subsidiaries, including Employee Directors and Officers
who are regular or former regular employees of the Company, Directors who are
not regular employees of the Company, as well as consultants to the
Company.  Any person who files with the Committee, in a form
satisfactory to the Committee, a written waiver of eligibility to receive any
Option under this Plan shall not be eligible to receive any Option under this
Plan for the duration of such waiver.

    

    (b)           In
granting Options, the Committee shall take into consideration the contribution
the person has made, or is expected to make, to the success of the Company or
its Subsidiaries and such other factors as the Committee shall
determine.  The Committee shall also have the authority to consult
with and receive recommendations from Officers and other personnel of the
Company and its Subsidiaries with regard to these matters.  The
Committee may from time to time in granting Options under this Plan prescribe
such terms and conditions concerning such Options as it deems appropriate,
provided that such terms and conditions are not more favorable to an Optionee
than those expressly permitted herein; provided further, however, that to the
extent not cancelled pursuant to Section 9(b) hereof, upon a Change in Control,
any Options that have not yet vested, may, in the sole discretion of the
Committee, vest upon such Change in Control.

    

    (c)           The
Options granted to employees under this Plan shall be in addition to regular
salaries, pension, life insurance or other benefits related to their employment
with the Company or its Subsidiaries.  Neither this Plan nor any
Option granted under this Plan shall confer upon any person any right to
employment or continuance of employment (or related salary and benefits) by the
Company or its Subsidiaries.

    

    6.           Exercise
Price.  The exercise price per Share of any Option shall be any
price determined by the Committee but in no event shall the exercise price per
Share of any Option be less than the Fair Market Value of the Shares underlying
such Option on the date such Option is granted and, in the case of an Incentive
Stock Option granted to a 10% stockholder, the per Share exercise price will not
be less than 110% of the Fair Market Value.  Re-granted Options, or
Options which are canceled and then re-granted covering such canceled Options,
will, for purposes of this Section 6, be deemed to have been granted on the date
of the re-granting.

    

    7.           Exercise of
Options.

    

    (a)           An
Option shall be deemed exercised when (i) the Company has received written
notice of such exercise in accordance with the terms of the Option,
(ii) full payment of the aggregate option price of the Shares as to which
the Option is exercised has been made, (iii) the Optionee has agreed to be
bound by the terms, provisions and conditions of any applicable stockholders’
agreement, and (iv) arrangements that are satisfactory to the Committee in
its sole discretion have been made for the Optionee’s payment to the Company of
the amount that is necessary for the Company or the Subsidiary employing the
Optionee to withhold in accordance with applicable Federal or state tax
withholding requirements.  Unless further limited by the Committee in
any Option, the exercise price of any Shares purchased pursuant to the exercise
of such Option shall be paid in cash, by certified or official bank check, by
money order, with Shares or by a combination of the above; provided, however,
that the Committee in its sole discretion may accept a personal check in full or
partial payment of any Shares.  The Company in its sole discretion
may, on an individual basis or pursuant to a general program established by the
Committee in connection with this Plan, lend money to an Optionee to exercise
all or a portion of the Option granted hereunder.  If the exercise
price is paid in whole or part with the Optionee’s promissory note, such note
shall (i) provide for full recourse to the maker, (ii) be
collateralized by the pledge of the Shares that the Optionee purchases upon
exercise of such Option, (iii) bear interest at a rate no less than the
rate of interest payable by the Company to its principal lender, and
(iv) contain such other terms as the Committee in its sole discretion shall
require.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    (b)           No
Optionee shall be deemed to be a holder of any Shares subject to an Option
unless and until a stock certificate or certificates for such Shares are issued
to such person(s) under the terms of this Plan.  No adjustment shall
be made for dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distributions or other rights for which the record date is
prior to the date such stock certificate is issued, except as expressly provided
in Section 10 hereof.

    

    (c)           Any
Option may, in the discretion of the Committee, be exercised pursuant to a
“cashless” or “net issue” exercise.  In lieu of exercising the Option
as specified in subsection (a) above, the Optionee may pay in whole or in part
with Shares, the number of which shall be determined by dividing (a) the
aggregate Fair Value of such Shares otherwise issuable upon exercise of the
Option minus the aggregate Exercise Price of such Option by (b) the Fair Value
of one such Share, or the Optionee may pay in whole or in part through a
reduction in the number of Shares received through the exercise of the Option
equal to the quotient of the (a) aggregate Fair Value of all the Shares issuable
upon exercise of the Option minus the aggregate Exercise Price of such Option
(b) divided by the Fair Value of one such share.  If the exercise
price is paid in whole or in part with Shares, the value of the Shares
surrendered shall be their Fair Market Value on the date the Option is
exercised.

    

    8.           Exercisability of
Options.  Any Option shall become exercisable in such amounts,
at such intervals, upon such events or occurrences and upon such other terms and
conditions as shall be provided in an individual Option agreement evidencing
such Option, except as otherwise provided in Section 5(b) or this Section
8.

    

    (a)           The
expiration date(s) of an Option shall be determined by the Committee at the time
of grant, but in no event shall an Option be exercisable after the expiration of
10 years from the date of grant of the Option.

    

    (b)           Unless
otherwise expressly provided in any Option as approved by the Committee,
notwithstanding the exercise schedule set forth in any Option, each outstanding
Option, may, in the sole discretion of the Committee, become fully exercisable
upon the date of the occurrence of any Change of Control, but, unless otherwise
expressly provided in any Option, no earlier than six months after the date of
grant, and if and only if Optionee is in the employ of the Company on such
date.

    

    (c)           The
Committee may in its sole discretion accelerate the date on which any Option may
be exercised and may accelerate the vesting of any Shares subject to any Option
or previously acquired by the exercise of any Option.

    

    9.           Termination of Option
Period.

    

    (a)           Unless
otherwise expressly provided in any Option, the unexercised portion of any
Option shall automatically and without notice immediately terminate and become
forfeited, null and void at the time of the earliest to occur of the
following:

    

    (i)           three
months after the date on which the Optionee’s employment is terminated for any
reason other than by reason of (A) Cause, (B) the termination of the
Optionee’s employment with the Company by such Optionee following less than 60
days’ prior written notice to the Company of such termination (an “Improper
Termination”), (C) a mental or physical disability (within the meaning of
Section 22(e) of the Code) as determined by a medical doctor satisfactory to the
Committee, or (D) death;

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    (ii)           immediately
upon (A) the termination by the Company of the Optionee’s employment for
Cause, or (B) an Improper Termination;

    

    (iii)           one
year after the date on which the Optionee’s employment is terminated by reason
of a mental or physical disability (within the meaning of Code
Section 22(e)) as determined by a medical doctor satisfactory to the
Committee or the later of three months after the date on which the Optionee
shall die if such death shall occur during the one-year period specified herein;
or

    

    (iv)           the
later of (a) one year after the date of termination of the Optionee’s employment
by reason of death of the employee, or (b) three months after the date on which
the Optionee shall die if such death shall occur during the one year period
specified in Subsection 9(a)(iii) hereof.

    

    (b)           The
Committee in its sole discretion may, by giving written notice (“cancellation
notice”), cancel effective upon the date of the consummation of any corporate
transaction described in Subsection 10(d) hereof, any Option that remains
unexercised on such date.  Such cancellation notice shall be given a
reasonable period of time prior to the proposed date of such cancellation and
may be given either before or after approval of such corporate
transaction.

    

    (c)           Upon
termination of Optionee’s employment as described in this Section 9, or
otherwise, any Option (or portion thereof) not previously vested or not yet
exercisable pursuant to Section 8 of this Plan or the vesting schedule set forth
in such Option shall be immediately canceled.

    

    10.           Adjustment of
Shares.

    

    (a)           If
at any time while this Plan is in effect or unexercised Options are outstanding,
there shall be any increase or decrease in the number of issued and outstanding
Shares through the declaration of a stock dividend or through any
recapitalization resulting in a stock split, combination or exchange of Shares
(other than any such exchange or issuance of Shares through which Shares are
issued to effect an acquisition of another business or entity or the Company’s
purchase of Shares to exercise a “call” purchase option), then and in such
event:

    

    (i)           appropriate
adjustment shall be made in the maximum number of Shares available for grant
under this Plan, so that the same percentage of the Company’s issued and
outstanding Shares shall continue to be subject to being so
optioned;

    

    (ii)           appropriate
adjustment shall be made in the number of Shares and the exercise price per
Share thereof then subject to any outstanding Option, so that the same
percentage of the Company’s issued and outstanding Shares shall remain subject
to purchase at the same aggregate exercise price; and

    

    (iii)           such
adjustments shall be made by the Committee, whose determination in that respect
shall be final, binding and conclusive.

    

    (b)           Subject
to the specific terms of any Option, the Committee may change the terms of
Options outstanding under this Plan, with respect to the option price or the
number of Shares subject to the Options, or both, when, in the Committee’s sole
discretion, such adjustments become appropriate by reason of a corporate
transaction described in Subsection 10(d) hereof, or otherwise.

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    (c)           Except
as otherwise expressly provided herein, the issuance by the Company of shares of
its capital stock of any class, or securities convertible into or exchangeable
for shares of its capital stock of any class, either in connection with a direct
or underwritten sale, or upon the exercise of rights or warrants to subscribe
therefor or purchase such Shares, or upon conversion of obligations of the
Company into such Shares or other securities, shall not affect, and no
adjustment by reason thereof shall be made with respect to, the number of or
exercise price of Shares then subject to outstanding Options granted under this
Plan.

    

    (d)           Without
limiting the generality of the foregoing, the existence of outstanding Options
granted under this Plan shall not affect in any manner the right or power of the
Company to make, authorize or consummate (i) any or all adjustments,
reclassifications, recapitalizations, reorganizations or other changes in the
Company’s capital structure or its business; (ii) any merger or
consolidation of the Company or to which the Company is a party; (iii) any
issuance by the Company of debt securities, or preferred or preference stock
that would rank senior to or above the Shares subject to outstanding Options;
(iv) any purchase or issuance by the Company of Shares or other classes of
common stock or common equity securities; (v) the dissolution or
liquidation of the Company; (vi) any sale, transfer, encumbrance, pledge or
assignment of all or any part of the assets or business of the Company; or
(vii) any other corporate act or proceeding, whether of a similar character
or otherwise.

    

    (e)           The
Optionee shall receive written notice within a reasonable time prior to the
consummation of such action advising the Optionee of any of the
foregoing.  The Committee may, in the exercise of its sole discretion,
in such instances declare that any Option shall terminate as of a date fixed by
the Board and give each Optionee the right to exercise his or her
Option.

    

    11.           Transferability.  No
Option or stock appreciation right granted hereunder shall be sold, pledged,
assigned, hypothecated, disposed or otherwise transferred by the Optionee other
than by will or the laws of descent and distribution, unless otherwise
authorized by the Board, and no Option or stock appreciation right shall be
exercisable during the Optionee’s lifetime by any person other than the
Optionee.

    

    12.           Issuance of
Shares.  As a condition of any sale or issuance of Shares upon
exercise of any Option, the Committee may require such agreements or
undertakings, if any, as the Committee may deem necessary or advisable to assure
compliance with any such law or regulation including, but not limited to, the
following:

    

    (i)           a
representation and warranty by the Optionee to the Company, at the time any
Option is exercised, that he is acquiring the Shares to be issued to him for
investment and not with a view to, or for sale in connection with, the
distribution of any such Shares; and

    (ii)           an
agreement and undertaking to comply with all of the terms, restrictions and
provisions set forth in any then applicable stockholders’ agreement relating to
the Shares, including, without limitation, any restrictions on transferability,
any rights of first refusal and any option of the Company to “call” or purchase
such Shares under then applicable agreements, and

    (iii)           any
restrictive legend or legends, to be embossed or imprinted on Share
certificates, that are, in the discretion of the Committee, necessary or
appropriate to comply with the provisions of any securities law or other
restriction applicable to the issuance of the Shares.

    

    13.           Stock Appreciation
Rights.  The Committee may grant stock appreciation rights to
Employees, either or tandem with Options that have been or are granted under the
Plan or with respect to a number of Shares on which an Option is not
granted.  A stock appreciation right shall entitle the holder to
receive, with respect to each Share as to which the right is exercised, payment
in an amount equal to the excess of the Share’s Fair Market Value on the date
the right is exercised over its Fair Market Value on the date the right was
granted.  Such payment may be made in cash or in Shares valued at the
Fair Market Value as of the date of surrender, or partly in cash and partly in
Shares, as determined by the Committee in its sole discretion.  The
Committee may establish a maximum appreciation value payable for stock
appreciation rights.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    14.           Restricted Stock
Awards.   The Committee may grant restricted stock awards
under the Plan in Shares or denominated in units of Shares.  The
Committee, in its sole discretion, may make such awards subject to conditions
and restrictions, as set forth in the instrument evidencing the award, which may
be based on continuous service with the Company or the attainment of certain
performance goals related to profits, profit growth, cash-flow or shareholder
returns, where such goals may be stated in absolute terms or relative to
comparison companies or indices to be achieved during a period of
time.

    

    15.           Administration of this
Plan.

    

    (a)           This
Plan shall be administered by the Committee, which shall consist of not less
than two Directors.  The Committee shall have all of the powers of the
Board with respect to this Plan.  Any member of the Committee may be
removed at any time, with or without cause, by resolution of the Board and any
vacancy occurring in the membership of the Committee may be filled by
appointment by the Board.

    

    (b)           Subject
to the provisions of this Plan, the Committee shall have the authority, in its
sole discretion, to:  (i) grant Options, (ii) determine the
exercise price per Share at which Options may be exercised, (iii) determine
the Optionees to whom, and time or times at which, Options shall be granted,
(iv) determine the number of Shares to be represented by each Option,
(v) determine the terms, conditions and provisions of each Option granted
(which need not be identical) and, with the consent of the holder thereof,
modify or amend each Option, (vi) defer (with the consent of the Optionee)
or accelerate the exercise date of any Option, and (vii) make all other
determinations deemed necessary or advisable for the administration of this
Plan, including re-pricing, canceling and regranting Options.

    

    (c)           The
Committee, from time to time, may adopt rules and regulations for carrying out
the purposes of this Plan.  The Committee’s determinations and its
interpretation and construction of any provision of this Plan shall be final,
conclusive and binding upon all Optionees and any holders of any Options granted
under this Plan.

    

    (d)           Any
and all decisions or determinations of the Committee shall be made either (i) by
a majority vote of the members of the Committee at a meeting of the Committee or
(ii) without a meeting by the unanimous written approval of the members of the
Committee.

    

    (e)           No
member of the Committee, or any Officer or Director of the Company or its
Subsidiaries, shall be personally liable for any act or omission made in good
faith in connection with this Plan.

    

    16.           Incentive Options for 10%
Stockholders.  Notwithstanding any other provisions of this
Plan to the contrary, an Incentive Stock Option shall not be granted to any
person owning directly or indirectly (through attribution under Section 424(d)
of the Code) at the date of grant, stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company (or of its
Subsidiary) at the date of grant unless the exercise price of such Option is at
least 110% of the Fair Market Value of the Shares subject to such Option on the
date the Option is granted, and such Option by its terms is not exercisable
after the expiration of 10 years from the date such Option is
granted.

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    17.           Interpretation.

    

    (a)           This
Plan shall be administered and interpreted so that all Incentive Stock Options
granted under this Plan will qualify as Incentive Stock Options under Section
422 of the Code.  If any provision of this Plan should be held invalid
for the granting of Incentive Stock Options or illegal for any reason, such
determination shall not affect the remaining provisions hereof, and this Plan
shall be construed and enforced as if such provision had never been included in
this Plan.

    

    (b)           This
Plan shall be governed by the laws of the State of New York.

    

    (c)           Headings
contained in this Plan are for convenience only and shall in no manner be
construed as part of this Plan or affect the meaning or interpretation of any
part of this Plan.

    

    (d)           Any
reference to the masculine, feminine, or neuter gender shall be a reference to
such other gender as is appropriate.

    

    (e)           Time
shall be of the essence with respect to all time periods specified for the
giving of notices to the company hereunder, as well as all time periods for the
expiration and termination of Options in accordance with Section 9 hereof (or as
otherwise set forth in an option agreement).

    

    18.           Amendment and
Discontinuation of this Plan.  Either the Board or the
Committee may from time to time amend this Plan or any Option without the
consent or approval of the stockholders of the Company; provided, however, that,
except to the extent provided in Section 9, no amendment or suspension of this
Plan or any Option issued hereunder shall substantially impair any Option
previously granted to any Optionee without the consent of such
Optionee.

    

    19.           Termination
Date.  This Plan shall terminate ten years after the date of
adoption by the Board of Directors

    
      
         

      

      
        9

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00167-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00167-of-00352.parquet"}]]