Document:

golden_8k-plan.htm

    Exhibit
10.1

     

     

     

    

     

    GOLDEN
EAGLE INTERNATIONAL, INC.

     

    REVISED
2009 EQUITY INCENTIVE PLAN

     

    

     

    

     

    

     

    

    Effective
Date: October 7, 2009

     

    Approved
by the Board of Directors on October 7, 2009

     

    Approved
by the Stockholders on __________, 2009

     

     

     

     

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
Table of
Contents

    
      	 	 Page	 
	
              ARTICLE
      I INTRODUCTION

            	
              1

            	 
	
                  1.1           Establishment

            	
              1

            	 
	
                  1.2           Purpose

            	
              1

            	 
	 
      	 
      	 
	
              ARTICLE
      II DEFINITIONS

                  2.1           Definitions

                  2.2           Gender and
      Number

            	
              1

              1

              5

            	 
	 
      	 
      	 
	
              ARTICLE
      III PLAN ADMINISTRATION

                  3.1           General

                  3.2           Delegation
      by Committee

                  3.3           Contractual
      Limitations

            	
              5

              5

              5

              6

            	 
	 
      	 
      	 
	
              ARTICLE
      IV STOCK SUBJECT TO THE PLAN

                  4.1           Number
      of Shares

                  4.2           Other
      Shares of Stock

                  4.3           Adjustments
      for Stock Split, Stock Dividend, Etc

                  4.4           Other
      Distributions and Changes in the Stock

                  4.5           General
      Adjustment Rules

                  4.6           Determination
      by the Committee, Etc.

            	
              6

              6

              6

              6

              7

              7

              7

            	 
	 
      	 
      	 
	
              ARTICLE
      V CHANGE IN CONTROL

                  5.1           Change
      in Control Provisions Applicable at the Discretion of the
      Committee

                  5.2           Additional
      Provisions Related to Options.

                  5.3           Company
      Actions

            	
              7

              7

              9

              9

            	 
	 
      	 
      	 
	
              ARTICLE
      VI PARTICIPATION

            	
              9

            	 
	 
      	 
      	 
	
              ARTICLE
      VII OPTIONS

                  7.1           Grant
      of Options

                  7.2           Stock
      Option Agreements

                  7.3           Restrictions
      on Incentive Options

                  7.4           Transferability

                  7.5           Stockholder
      Privileges

            	
              10

              10

              10

              13

              13

              13

            	 
	 
      	 
      	 
	
              ARTICLE
      VIII RESTRICTED STOCK AWARDS

                  8.1           Grant
      of Restricted Stock Awards

                  8.2           Restrictions

                  8.3           Privileges
      of a Stockholder, Transferability

                  8.4           Enforcement
      of Restrictions

            	
              13

              13

              14

              14

              14

            	 
	 
      	 
      	 
	
              ARTICLE
      IX OTHER GRANTS

            	14	 
	 
      	 
      	 
	
              ARTICLE
      X RIGHTS OF PARTICIPANTS

                  10.1           Employment
      or Service

                  10.2           Nontransferability
      of Awards

                  10.3           No
      Plan Funding

            	
              14

              14

              15

              15

            	 

    

    

     

    i

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
 

    
      
        	
                ARTICLE
      XI GENERAL RESTRICTIONS

                    11.1           Investment
      Representations

                    11.2           Compliance
      with Securities Laws

                    11.3           Changes
      in Accounting or Tax Rules

                    11.4           Stockholder
      Agreements

                    11.5           Lock-Up
      Period

              	
                15

                15

                15

                16

                16

                16

              	 
	 
      	 
      	 
	
                ARTICLE
      XII PLAN AMENDMENT, MODIFICATION AND TERMINATION

              	16	 
	 
      	 
      	 
	
                ARTICLE
      XIII WITHHOLDING

                    13.1           Withholding
      Requirement

                    13.2           Withholding
      With Stock

              	
                17

                17

                17

              	 
	 
      	 
      	 
	
                ARTICLE
      XIV REQUIREMENTS OF LAW

                    14.1           Requirements
      of Law

                    14.2           Federal
      Securities Law Requirements

                    14.3           Section
      409A

                    14.4           Participant’s
      Representations

                    14.5           Governing
      Law

              	
                17

                17

                17

                18

                18

                18

              	 
	 
      	 
      	 
	
                ARTICLE
      XV DURATION OF THE PLAN

              	18	 
	 
      	 
      	 
	
                ARTICLE
      XVI EFFECTIVENESS OF THE PLAN

              	18	 
	 
      	 
      	 

      

    

     

     

     

     

     

    ii

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    GOLDEN
EAGLE INTERNATIONAL, INC.

     

    REVISED
2009 EQUITY INCENTIVE PLAN

     

    ARTICLE
I

    INTRODUCTION

     

    1.1  Establishment   
 Golden
Eagle International, Inc., a Colorado corporation (the “Company”),
adopts this Revised 2009 Equity Incentive Plan
(the “Revised Plan” or
“Plan”), effective as
of the Effective Date (as defined in Article II below).  The Revised
Plan is established for selected employees, consultants and advisors and
non-employee directors of the Company and its Affiliates (as defined in Article
II below).  The Plan permits the grant of incentive stock options
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended, non-qualified stock options, restricted stock awards, and other stock
grants to selected employees, consultants and advisors and non-employee
directors of the Company and its Affiliates.

     

    1.2  Purpose     The
purpose of the Plan is to provide financial incentives for selected employees,
consultants and advisors, and non-employee directors of the Company and its
Affiliates, thereby promoting the long-term growth and financial success of the
Company by (a) attracting and retaining the most qualified officers, directors,
key employees, and other persons, (b) strengthening the capability of the
Company and its Affiliates to develop, maintain and direct a competent
management team, (c) providing an effective means for selected employees,
consultants and advisors and non-employee directors to acquire and maintain a
direct proprietary interest in the operations and future success of the Company,
(d) motivating employees to achieve long-range performance goals and objectives,
and (e) providing incentive compensation opportunities competitive with
those of other organizations.

     

    ARTICLE
II  

    DEFINITIONS

     

    2.1  Definitions    The
following terms shall have the meanings set forth below:

     

    (a) “Affiliate”
means, with respect to the Company, (i) any Subsidiary of the Company, and
(ii) any other corporation or entity that is affiliated with the Company through
stock ownership or otherwise and is designated as an “Affiliate” by the Board,
provided, however, that for purposes of Incentive Options granted pursuant to
the Plan, an “Affiliate” means any parent or subsidiary of the Company as
defined in Section 424 of the Code.

     

    (b)  “Award”
means an Option, a Restricted Stock Award, grants of Stock pursuant to Article
IX or other issuances of Stock hereunder.

     

    (c) “Award
Agreement” means an Option Agreement, Restricted Stock Agreement or a
written agreement evidencing any other Award under this Plan.

     

    (d)  “Board”
means the Board of Directors of the Company.

     

    (e) “Change in
Control” means any of the following:

     

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    (i) Merger;
Reorganization.  Any consolidation or merger of the Company
with or into any other corporation or other entity or person, or any other
corporate reorganization, in which the stockholders of the Company immediately
prior to such consolidation, merger or reorganization, own less than 50% of the
voting power of the surviving or successor entity immediately after such
consolidation, merger or reorganization, or any transaction or series of related
transactions to which the Company is a party in which in excess of 50% of the
Company’ voting power is transferred, excluding (A) any consolidation or merger
effected exclusively to change the domicile of the Company, (B) any transaction
or series of transactions principally for bona fide equity financing purposes in
which cash is received by the Company or any successor or indebtedness of the
Company is cancelled or converted or a combination thereof or (C) any
transaction or series of transactions for the purpose of creating a holding
company that will be owned in substantially the same proportions by the persons
who held the Company’s securities immediately before such transaction or series
of transactions; or

     

    (ii) Other
Transactions.  A sale, lease or other disposition of all or
substantially all of the assets of the Company.

     

    (f) “Code”
means the Internal Revenue Code of 1986, as it may be amended from time to
time.

     

    (g) “Committee”
means the Board, or if so delegated by the Board, a committee consisting of not
less than two members of the Board who are empowered hereunder to take actions
in the administration of the Plan. If applicable, the Committee shall be so
constituted at all times as to permit the Plan to comply with Rule 16b-3 or
any successor rule promulgated under the Exchange Act.  Except as
provided in Section 3.2, the Committee shall select Participants from
Eligible Employees, Eligible Consultants and Eligible Non-Employee Directors of
the Company and its Affiliates and shall determine the Awards to be made
pursuant to the Plan and the terms and conditions thereof.

     

    (h) “Company”
has the meaning given to that term in Section 1.1 hereof.

     

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

     

    (j) Domestic
Relations Order means any judgment, decree, or order (including approval
of a property settlement agreement) that is made pursuant to a state domestic
relations law and that relates to the provision of child support, alimony
payments, or marital property rights to a spouse, former spouse, child, or other
dependent of a Participant.

     

    (k) “Effective
Date” means the original effective date of the Revised Plan, October 7,
2009.

     

    (l) “Eligible
Consultants” means those consultants and advisors to the Company or an
Affiliate who are determined, by the Committee, to be individuals (i) whose
services are important to the Company or an Affiliate and who are eligible to
receive Awards, other than Incentive Options, under the Plan, and (ii) who meet
the conditions for eligibility under such other exemptions from registration
under the Securities Act as may be applicable.

     

    (m) “Eligible
Employees” means those employees (including, without limitation, officers
and directors who are also employees) of the Company or any Affiliate, upon
whose judgment, initiative and efforts the Company is, or will become, largely
dependent for the successful conduct of its business.  For purposes of
the Plan, an employee is any individual who provides services to the Company or
any Affiliate as a common law employee and whose remuneration is subject to the
withholding of federal income tax pursuant to Section 3401 of the
Code.  The term “Eligible Employee” shall not include any individual
(A) who provides services to the Company or an Affiliate under an
agreement, contract, or any other arrangement pursuant to which the individual
is initially classified as an independent contractor or (B) whose
remuneration for services has not been treated initially as subject to the
withholding of federal income tax pursuant to Section 3401 of the Code even
if the individual is subsequently reclassified as a common law employee as a
result of a final decree of a court of competent jurisdiction or the settlement
of an administrative or judicial proceeding.  Leased employees may, in
the discretion of the Committee, be treated as employees under this
Plan.

     

     

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    (n) “Eligible
Non-Employee Director” means any person serving on the Board who is not
an employee of the Company or any Affiliate.

     

    (o) “Exchange
Act” means the Securities Exchange Act of 1934, as it may be amended from
time to time.

     

    (p) “Fair Market
Value” means, as of a given date, (i) the closing price of a Share
on the principal stock exchange on which the Stock is then trading, if any (or
as reported on any composite index that includes such principal exchange) on
such date, or if Shares were not traded on such date, then on the next preceding
date on which a trade occurred; or (ii) if the Stock is not traded on an
exchange but is quoted on the OTC Bulletin Board or a successor quotation
system, the mean between the closing representative bid and asked prices for the
Stock on such date as reported by the OTC Bulletin Board or such successor
quotation system; or (iii) if the Stock is not publicly traded on an
exchange and not quoted on the OTC Bulletin Board or a successor quotation
system, the Fair Market Value of a Share shall be determined by the Committee
acting in good faith.

     

    (q) “Forfeiture
Restrictions” has the meaning given to that term in Section 8.2
hereof.

     

    (r)  “Incentive
Option” means an Option designated as such and granted in accordance with
Section 422 of the Code.

     

    (s) “Misconduct”
means, unless explicitly provided for otherwise in an Award Agreement, any of
the following: (i) violation of any material term of any written employment
agreement entered into between the Company (or any of its Affiliates) and the
Option Holder; (ii) any grossly negligent, fraudulent, criminal, malicious
or willful act or failure to act on the part of Option Holder, or any other
conduct on Option Holder's part intended to or likely to injure the business or
reputation of the Company or any of its Affiliates, but shall not include the
death or Disability of Option Holder or any absence due to his or her illness,
incapacity or injury as specifically permitted by any written employment
agreement between the Company (or any of its Affiliates) and Option Holder;
(iii) failure to meet the job performance expectations of the Company or
any of its Affiliates after having received written or verbal notice of the
expectations and giving Option Holder a reasonable period of time to meet
expectations; (iv) theft, misuse or misappropriation of property, money or
time of the Company or any of its Affiliates; (v) being intoxicated or
under the influence of alcohol or drugs (not prescribed by a physician) while at
work or performing work-related activities; (vii) disloyalty or breach of
Option Holder's fiduciary duty(ies); (viii) any material unauthorized use
or disclosure by such person of confidential information or trade secrets of the
Company or any of its Affiliates; or (ix) any other reason in the policies
of the Company or any of its Affiliates that would be grounds for discharge of
employees of the Company or such Affiliate.  For purposes of this
definition, the terms “Company” and “Affiliate” shall include any Successor of
the Company and/or such Affiliate.  The foregoing definition shall not
in any way preclude or restrict the right of the Company or any Affiliate (or
its respective Successor) to discharge or dismiss the Option Holder from the
Service of the Company or any Affiliate (or its respective Successor) for any
other acts or omissions, but such other acts or omissions shall not be deemed,
for purposes of the Plan, to constitute grounds for termination for
Misconduct.

     

     

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    (t) “Non-Qualified
Option” means any Option other than an Incentive Option.

     

    (u) “Option”
means a right to purchase Stock at a stated or formula price for a specified
period of time.  Options granted under the Plan shall be either
Incentive Options or Non-Qualified Options.

     

    (v) “Option
Agreement” has the meaning given to that term in Section 7.2
hereof.

     

    (w) “Option
Holder” means a Participant who has been granted one or more Options
under the Plan.

     

    (x) “Option
Period” means the period of time, determined by the Committee, during
which an Option may be exercised by the Option Holder.

     

    (y) “Option
Price” has the meaning given to that term in Subsection 7.2(b)
hereof.

     

    (z) “Participant”
means an Eligible Employee, Eligible Consultant, or Eligible Non-Employee
Director designated by the Committee from time to time during the term of the
Plan to receive one or more Awards available under the Plan.

     

    (aa) “Plan” has
the meaning given to that term in Section 1.1 hereof.

     

    (bb) “Repurchase
Rights” has the meaning given to that term in Subsection 7.2(d)
hereof.

     

    (cc) “Restricted Stock
Agreement” has the meaning given to that term in Section 8.1
hereof.

     

    (dd) “Restricted Stock
Award” means an award of Stock granted to a Participant pursuant to
ARTICLE VIII that is subject to certain restrictions imposed in accordance with
the provisions of such Section.

     

    (ee) “Section
16” has the meaning given to that term in Subsection 13.2(c)
hereof.

     

    (ff) “Securities
Act” means the Securities Act of 1933, as it may be amended from time to
time.

     

    (gg) “Service” means
service to the Company or an Affiliate as an employee, a
non-employee director or a consultant or advisor, except to the extent otherwise
specifically provided in an Award Agreement.  The Committee determines
which leaves of absence count toward Service, and when Service terminates for
all purposes under the Plan.  Further, unless otherwise determined by
the Committee, a Participant’s Service shall not be deemed to have terminated
merely because of a change in capacity in which the Participant provides Service
to the Company or an Affiliate or a transfer between the Company and its
Affiliates; provided there is no interruption or other termination of
Service.

     

    (hh)  “Share”
means one whole share of Stock.

     

    (ii)  “Stock”
means the $0.0001 par value common stock of the Company.

     

    (jj) “Subsidiary”
means any corporation more than 50% of the outstanding voting securities of
which are owned by the Company or any other Subsidiary, directly or indirectly,
or a partnership or limited liability company in which the Company or any
Subsidiary is a general partner or manager or holds interests entitling it to
receive more than 50% of the profits or losses of the partnership or limited
liability company.

     

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    (kk) “Successor” has the meaning given to
that term in Subsection 5.2(a) hereof.

     

    (ll) “Tax Date”
has the meaning given to that term in Section 13.2 hereof.

     

    2.2  Gender
and Number

     

    .  Except
when otherwise indicated by the context, the masculine gender shall also include
the feminine gender, and the definition of any term herein in the singular shall
also include the plural.

     

    ARTICLE
III       

    PLAN
ADMINISTRATION

     

    3.1  General.  The
Plan shall be administered by the Committee.  In accordance with the
provisions of the Plan, the Committee shall, in its sole discretion, select the
Participants from among the Eligible Employees, Eligible Consultants and
Eligible Non-Employee Directors, determine the Awards to be made pursuant to the
Plan, or shares of Stock to be issued thereunder and the time at which such
Awards are to be made, fix the Option Price, period and manner in which an
Option becomes exercisable, establish the duration and nature of Restricted
Stock Award restrictions, establish the terms and conditions applicable to, and
establish such other terms and requirements of the various compensation
incentives under the Plan as the Committee may deem necessary or desirable, and
consistent with the terms of the Plan.  The Committee shall determine
the form or forms of the agreements with Participants that shall evidence the
particular provisions, terms, conditions, rights and duties of the Company and
the Participants with respect to Awards granted pursuant to the Plan, which
provisions need not be identical except as may be provided herein; provided,
however, that Eligible Consultants and Eligible Non-Employee Directors shall not
be eligible to receive Incentive Options.  The Committee may from time
to time adopt such rules and regulations for carrying out the purposes of the
Plan as it may deem proper and in the best interests of the
Company.  The Committee may correct any defect, supply any omission or
reconcile any inconsistency in the Plan or in any agreement entered into
hereunder in the manner and to the extent it shall deem expedient and it shall
be the sole and final judge of such expediency.  The Committee and
each member thereof, and any person acting pursuant to authority delegated by
the Committee, shall be entitled, in good faith, to rely or act upon any report
or other information furnished by any executive officer, other officer or
employee of the Company or its Affiliates or the Company’s auditors, consultants
or any other agents assisting in the administration of the
Plan.  Members of the Committee, any person acting pursuant to
authority delegated by the Committee, and any officer or employee of the Company
or its Affiliates acting at the direction or on behalf of the Committee shall
not be personally liable for any action or determination taken or made in good
faith with respect to the Plan, and shall, to the extent permitted by law, be
fully indemnified and protected by the Company with respect to any such action
or determination.  The determinations, interpretations and other
actions of the Committee pursuant to the provisions of the Plan shall be binding
and conclusive for all purposes and on all persons.

     

    3.2  Delegation
by Committee.  The
Committee may, from time to time, delegate, to specified officers of the
Company, the power and authority to grant Awards under the Plan to specified
groups of Eligible Employees, Eligible Consultants and Eligible Non-Employee
Directors, subject to such restrictions and conditions as the Committee, in its
sole discretion, may impose.  The delegation shall be as broad or as
narrow as the Committee shall determine.  To the extent that the
Committee has delegated the authority to determine certain terms and conditions
of an Award, all references in the Plan to the Committee’s exercise of authority
in determining such terms and conditions shall be construed to include the
officer or officers to whom the Committee has delegated the power and authority
to make such determination.  At any time that the Company is subject
to the reporting requirements of the Exchange Act or has a class of securities
registered under the Exchange Act, the power and authority to grant Awards to
any Eligible Employee, Eligible Consultant or Eligible Non-Employee Director who
is covered by Section 16(b) of the Exchange Act shall not be delegated by
the Committee.

     

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    3.3  Contractual
Limitations.  The
Committee shall in exercising its discretion under the Plan comply with all
contractual obligations of the Company in effect from time to time, whether
contained in the Company’s Certificate of Incorporation, By-laws or other
binding contract.

     

    ARTICLE
IV

    STOCK
SUBJECT TO THE PLAN

     

    4.1  Number
of Shares.  (a)  The
maximum aggregate number of Shares that may be issued under the Plan pursuant to
Awards is 750,000,000 Shares.  Upon exercise of an option (whether
granted under this Plan or otherwise), the Shares issued upon exercise of such
option shall no longer be considered to be subject to an outstanding Award or
option for purposes of the immediately preceding
sentence.  Notwithstanding anything to the contrary contained herein,
no Award granted hereunder shall become void or otherwise be adversely affected
solely because of a change in the number of Shares of the Company that are
issued and outstanding from time to time, provided that changes to the issued
and outstanding Shares may result in adjustments to outstanding Awards in
accordance with the provisions of this ARTICLE IV. The maximum number of Shares
that may be issued under Incentive Options is 750,000,000 Shares.

     

    (b)           The
Shares may be either authorized and unissued Shares or previously issued Shares
acquired by the Company.  The maximum numbers may be increased from
time to time by approval of the Board and by the stockholders of the Company if,
in the opinion of counsel for the Company, stockholder approval is
required.  Stockholder approval shall not be required for increases
solely pursuant to Section 4.3 below.  The Company shall at all
times during the term of the Plan and while any Options are outstanding retain
as authorized and unissued Stock at least the number of Shares from time to time
required under the provisions of the Plan, or otherwise assure itself of its
ability to perform its obligations hereunder.

     

    4.2  Other
Shares of Stock.  Any
Shares that are subject to an Option that expires or for any reason is
terminated unexercised, any Shares that are subject to an Award (other than an
Option) and that are forfeited, and any Shares withheld for the payment of taxes
or received by the Company as payment of the exercise price of an Option shall
automatically become available for use under the Plan.

     

    4.3  Adjustments
for Stock Split, Stock Dividend, Etc.     If
the Company shall at any time increase or decrease the number of its authorized
or outstanding Shares (or both its authorized and outstanding shares) or change
in any way the rights and privileges of such Shares by means of the payment of a
stock dividend or any other distribution upon such Shares payable in Stock, or
through a stock split, subdivision, consolidation, combination, reclassification
or recapitalization involving the Stock, then in relation to the Stock that is
affected by one or more of the above events, the numbers, exercise price, rights
and privileges of the following shall be increased, decreased or changed in like
manner as if they had been issued and outstanding, fully paid and nonassessable
at the time of such occurrence:  (i) the Shares as to which
Awards may be granted under the Plan, (ii) the Shares then included in each
outstanding Award granted hereunder, (iii) the maximum number of Shares
available for grant pursuant to Incentive Options, and (iv) the number of
Shares subject to a delegation of authority under Section 3.2 of this
Plan.

     

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    4.4  Other
Distributions and Changes in the Stock    If

     

    (a) The
Company shall at any time distribute with respect to the Stock assets or
securities of persons other than the Company (excluding (i) cash or (ii)
distributions referred to in Section 4.3), or

     

    (b) The
Company shall at any time grant to the holders of its Stock rights to subscribe
pro rata for additional shares thereof or for any other securities of the
Company, or

     

    (c) There
shall be any other change (except as described in Section 4.3) in the
number or kind of outstanding Shares or of any stock or other securities into
which the Stock shall be changed or for which it shall have been
exchanged,

     

    then the
Committee shall make an equitable adjustment, in such manner as the Committee
deems appropriate, to the number, class and kind of Shares subject to
outstanding Awards and, if applicable, the Option
Price.  Notwithstanding the foregoing provisions of this
Section 4.4, pursuant to Section 8.3 below, a Participant holding
Stock received as a Restricted Stock Award shall have the right to receive all
amounts, including cash and property of any kind, distributed with respect to
the Stock after such Restricted Stock Award was granted upon the Participant’s
becoming a holder of record of the Stock.

     

    4.5  General
Adjustment Rules.  No
adjustment or substitution provided for in this ARTICLE IV shall require the
Company to sell a fractional Share under any Option, or otherwise issue a
fractional Share, and the total substitution or adjustment with respect to each
Option and other Award shall be limited by deleting any fractional
Share.  In the case of any such substitution or adjustment, the
aggregate Option Price for the total number of Shares then subject to an Option
shall remain unchanged but the Option Price per Share under each such Option
shall be equitably adjusted by the Committee to reflect the greater or lesser
number of Shares or other securities into which the Stock subject to the Option
may have been changed, and appropriate adjustments shall be made to other Awards
to reflect any such substitution or adjustment.

     

     

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    4.6  Determination
by the Committee, Etc.  Adjustments
under this ARTICLE IV shall be made by the Committee, whose determinations with
regard thereto shall be final and binding upon all parties thereto.

     

    ARTICLE
V

    CHANGE
IN CONTROL

     

    5.1  Change
in Control Provisions Applicable at the Discretion of the Committee 
(a) Unless
the Option Agreement provides to the contrary pursuant to Section 7.2(d), the
Award shall automatically accelerate and vest in full or in part upon the
occurrence of a Change in Control (and any Forfeiture Restrictions or Repurchase
Rights of the Company with respect to unvested Shares received pursuant to the
Award shall immediately terminate), whether or not the Award is to be assumed in
the Change in Control or the Forfeiture Restrictions or Repurchase Rights of the
Company would otherwise continue in effect pursuant to the Change in
Control.

     

    (b) Unless
the Option Agreement provides to the contrary pursuant to Section 7.2(d), all of
the Shares subject to each Option will automatically vest on an accelerated
basis should the Option Holder’s Service terminate by reason of an involuntary
termination within a designated period (12 months, unless otherwise set forth by
the Committee but not to exceed 18 months) following any Change in Control in
which the Option is assumed or otherwise continued in effect and the Repurchase
Rights applicable to the Shares subject to such Option do not otherwise
terminate.  Any Option so accelerated shall remain exercisable for the
fully-vested Shares subject to such Option until the expiration or sooner
termination of the Option Period.  In addition, the Committee may
provide that one or more of the Company’s outstanding Repurchase Rights with
respect to Shares held by the Option Holder at the time of such involuntary
termination shall immediately terminate on an accelerated basis, and the Shares
subject to those terminated rights shall accordingly vest at that
time.

     

    (c) Unless
the Option Agreement provides to the contrary pursuant to Section 7.2(d), any
Forfeiture Restrictions with respect to any Restricted Stock Award shall
automatically terminate on an accelerated basis, and the Shares subject to those
terminated Forfeiture Restrictions shall immediately vest, in the event the
Participant’s Service should terminate by reason of an involuntary termination
within a designated period (12 months, unless otherwise set forth by the
Committee but not to exceed 18 months) following any Change in Control in which
those Forfeiture Restrictions are assigned to, and assumed by, the Successor or
otherwise continued in full force and effect.

     

    (d) Unless
the Option Agreement provides to the contrary pursuant to Section 7.2(d), any
Option shall be deemed automatically exercised on a net basis immediately prior
to a Change in Control if (i) the Option Price is less than the then-current
Fair Market Value per Share, and (ii) the Shares subject to the Option are
vested (including vesting by reason of the Change in Control).  Upon
such net exercise, the Option Holder shall be entitled to a number of Shares
computed using the following formula:

     

    
      	
              X
      =

            	
              Y
      (A–B)

            
	
              A

            

    

    

    
      	
               
      

            	
              Where:

            	
              X
      =

            	
              the
      number of Shares to be issued to the Option
  Holder;

            

    

     

    
      	
               
      

            	
              Y
      =

            	
              the
      number of Shares purchasable under the Option immediately prior to the
      Change in Control;

            

    

     

    
      	
               
      

            	
              A
      =

            	
              the
      then-current Fair Market Value of one Share of Stock;
  and

            

    

     

    
      	
               
      

            	
              B
      =

            	
              the
      per-Share Option Price of the
Option.

            

    

     

    In no
event shall the Committee be required to issue any fractional
Shares.

     

    (e) The
Committee shall also have full power and authority, exercisable at the time an
Option is granted or at any time while an Option remains outstanding, to provide
that the Option, if outstanding immediately prior to a Change in Control and
then having an Option Price less than the current Fair Market Value per Share,
shall be automatically cancelled at such time in exchange for a cash payment
equal to the product of (i) the number of vested Shares then subject to the
Option (including Shares that become vested as a result of the Change in
Control) multiplied by (ii) the excess of the (x) Fair Market Value of a Share
on the date of the Change in Control over (y) the Option Price.

     

    (f) Notwithstanding
any other provision in this ARTICLE V, the Committee shall have full power and
authority, exercisable at the time an Award is granted or at any time while the
Award remains outstanding, to provide for or take any other Change in Control
related action with respect to an Award as the Committee deems
appropriate.  The Committee need not take the same action with respect
to all outstanding Awards or to all outstanding Awards of the same
type.

     

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    5.2  Additional
Provisions Related to Options. (a) Unless
explicitly provided otherwise in an Option Agreement and subject to Section 5.1
above, upon the consummation of a Change in Control, all outstanding unvested
Options (and to the extent not exercised prior to or in connection with such
Change in Control, all outstanding vested Options) that are not assumed by the
successor corporation or other successor entity (or a parent thereof) (the
“Successor”)
or otherwise continued in effect pursuant to the terms of the Change in Control
transaction shall automatically be forfeited and cease to be
outstanding.

     

    (b) To the
extent any Option is assumed in connection with a Change in Control or otherwise
continued in effect, such Option shall be appropriately adjusted, immediately
after such Change in Control, to apply to the number and class of securities
which would have been issuable to the Option Holder in consummation of such
Change in Control, had the Option been exercised immediately prior to such
Change in Control.  Appropriate adjustments shall also be made to (i)
the number and class of securities available for issuance under the Option
following the consummation of such Change in Control and (ii) the exercise price
payable per share under each outstanding Option, provided the
aggregate exercise price payable for such securities shall remain the
same.  To the extent the actual holders of the Company’s outstanding
Stock receive cash consideration for their Stock in consummation of the Change
in Control, the Successor may, in connection with the assumption of the
outstanding Options under this Plan, substitute one or more shares of its own
common stock with a fair market value equivalent to the cash consideration paid
per Share of Stock in such Change in Control.

     

    5.3  Company
Actions .  The
grant of Awards under the Plan shall in no way affect the right of the Company
or any Affiliate to adjust, reclassify, reorganize or otherwise change its
capital or business structure or to merge, consolidate, dissolve, liquidate or
sell or transfer all or any part of its business or assets.

     

    ARTICLE
VI

    PARTICIPATION

     

    Participants
in the Plan shall be those Eligible Employees who, in the judgment of the
Committee, are performing, or during the term of their incentive arrangement
will perform, vital services in the management, operation and development of the
Company and its Affiliates, and significantly contribute, or are expected to
significantly contribute, to the achievement of long-term economic
objectives.  Eligible Consultants shall be selected from those
non-employee consultants and advisors to the Company and its Affiliates who have
performed or are performing services important to the operation and growth of
the Company and its Affiliates.  All Eligible Non-Employee Directors
selected by the Board may participate in the Plan.  Participants may
be granted from time to time one or more Awards; provided, however, that the
grant of each such Award shall be separately approved by the Committee and
receipt of one such Award shall not result in automatic receipt of any other
Award.  Upon determination by the Committee that an Award is to be
granted to a Participant, written notice shall be given to such person,
specifying the terms, conditions, rights and duties related
thereto.  Each Participant shall, if required by the Committee, enter
into an agreement with the Company, in such form as the Committee shall
determine and which is consistent with the provisions of the Plan, specifying
such terms, conditions, rights and duties.  Awards shall be deemed to
be granted as of the date specified in the grant resolution of the Committee,
which date shall be the date of any related agreement with the
Participant.  In the event of any inconsistency between the provisions
of the Plan and any such agreement entered into hereunder, the provisions of the
Plan shall govern.

     

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    ARTICLE
VII

    OPTIONS

     

    7.1  Grant
of Options.  Coincident
with or following designation for participation in the Plan, a Participant may
be granted one or more Options.  The Committee in its sole discretion
shall designate whether an Option is an Incentive Option or a Non-Qualified
Option; provided, however, that only Non-Qualified Options may be granted to
Eligible Consultants and Eligible Non-Employee Directors.  The Committee may grant
both an Incentive Option and a Non-Qualified Option to an Eligible Employee at
the same time or at different times.  Incentive Options and
Non-Qualified Options, whether granted at the same time or at different times,
shall be deemed to have been awarded in separate grants and shall be clearly
identified, and in no event shall the exercise of one Option affect the right to
exercise any other Option or affect the number of Shares for which any other
Option may be exercised.  An Option shall be considered as having been
granted on the date specified in the grant resolution of the
Committee.

     

    7.2  Stock
Option Agreements.  Each
Option granted under the Plan shall be evidenced by a written stock option
agreement (an “Option
Agreement”).  An Option Agreement shall be issued by the
Company in the name of the Participant to whom the Option is granted (the “Option
Holder”) and in such form as may be approved by the
Committee.  The Option Agreement shall incorporate and conform to the
conditions set forth in this Section 7.2 as well as such other terms and
conditions that are not inconsistent as the Committee may consider appropriate
in each case.

     

    (a)  Number of
Shares.  Each Option Agreement shall state that it covers a
specified number of Shares, as determined by the Committee.

     

    (b)  Price.  The
price at which each Share covered by an Option may be purchased (the “Option
Price”) shall be determined in each case by the Committee and set forth
in the Option Agreement, but in no event shall the price be less than
100% of the Fair Market Value of one Share of Stock on the date the Option
is granted.

     

    (c)  Duration of
Options; Vesting.  Each Option Agreement shall state the Option
Period applicable to the Option, which must end, in all cases, not more than ten
years from the date the Option is granted.  Each Option Holder shall
become vested in the Shares underlying the Option in such installments and over
such period or periods of time, if any, or upon such events, as are determined
by the Committee in its discretion and set forth in the Option
Agreement.

     

    (d)  Change of Control
Provisions.  Each Option Agreement shall state the
applicability of any of the Change of Control provisions set forth in Article
V.  If no statement is made, the Change of Control provisions shall be
deemed to be applicable.

     

    The
Option shall generally become exercisable, in whole or in part, at the same time
or times as the Shares underlying the Option vest; provided, however, that the
Committee may grant Options that are immediately exercisable in whole or in
part.  Any unvested Shares received by the Option Holder upon early
exercise of the Option in accordance with the preceding sentence shall be
subject to the Company’s right of repurchase, as follows.  Should the
Option Holder cease Service while holding unvested shares, the Company shall
have the right (but not the obligation) to repurchase any or all of those
unvested Shares at a price per share equal to the Option Price (the “Repurchase
Rights”).  The Company shall be entitled to exercise its right
to repurchase such unvested Shares by written notice to the Option Holder sent
within 90 days after the time of Option Holder’s cessation of Service, or (if
later) during the 90-day period following the execution date of any written
stock purchase agreement executed by the Company and the Option
Holder.  The notice shall indicate the number of unvested Shares to be
repurchased, the repurchase price to be paid per share (which shall be a price
per share equal to the Option Price) and the date on which the repurchase is to
be effected, such date to be not more than 30 days after the date of such
notice.

     

    10

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (e)  Termination of
Services, Death, Disability, Etc.  The Committee may specify
the period, if any, during which an Option may be exercised following
termination of the Option Holder’s Service.  The effect of this
Subsection 7.2(e) shall be limited to determining the consequences of a
termination and nothing in this Subsection 7.2(e) shall restrict or
otherwise interfere with the Company’s discretion with respect to the
termination of any individual’s Service.  If the Committee does not
otherwise specify, the following shall apply:

     

    (i) If the
Service of the Option Holder is terminated within the Option Period for
Misconduct, the Option shall thereafter be void for all purposes.

     

    (ii) If the
Option Holder becomes Disabled while still in Service of the Company or an
Affiliate, the Option may be exercised by the Option Holder within one year
following the Option Holder’s termination of Service on account of Disability
(provided that such exercise must occur within the Option Period), but not
thereafter.  In any such case, the Option may be exercised only as to
the Shares that had become vested on or before the date of the Option Holder’s
termination of Service because of Disability.

     

    (iii) If the
Option Holder dies during the Option Period while still in Service of the
Company or an Affiliate or within the one year period referred to in
(ii) above or the three-month period referred to in (iv) below, the
Option may be exercised by those entitled to do so under the Option Holder’s
will or by the laws of descent and distribution within one year following the
Option Holder’s death (provided that such exercise must occur within the Option
Period), but not thereafter.  In any such case, the Option may be
exercised only as to the Shares that had become vested on or before the date of
the Option Holder’s death.

     

    (iv) If the
Service of the Option Holder is terminated within the Option Period for any
reason other than Misconduct, Disability, or death, the Option may be exercised
by the Option Holder within three months following the date of such termination
(provided that such exercise must occur within the Option Period), but not
thereafter.  In any such case, the Option may be exercised only as to
the Shares that had become vested on or before the date of termination of
Service.

     

    (f)  No Employment
Right.  Nothing in this paragraph shall limit or impair the
right of the Company or any Affiliate to terminate the employment of any
employee or to terminate the consulting or advisory services of any consultant
or advisor.

     

    (g)  Exercise,
Payments, Etc.

     

    (i)  Manner of
Exercise.  The method for exercising each Option granted
hereunder shall be by delivery to the Company of written notice on any business
day, specifying the number of Shares with respect to which such Option is
exercised.  The purchase of such Shares shall take place at the
principal offices of the Company within 30 days following delivery of such
notice, at which time the Option Price of the Shares shall be paid in full by
any of the methods set forth below or a combination thereof.  The
Option shall be exercised when the Option Price for the number of Shares as to
which the Option is exercised is paid to the Company in full.  A
properly executed certificate or certificates representing the Shares shall be
delivered to or at the direction of the Option Holder upon payment
therefor.  An Option may be exercised as to any or all full shares of
Stock as to which the Option has become exercisable, provided however, that an
Option may not be exercised at any one time as to fewer than 100 shares of Stock
(or such number of shares of Stock as to which the Option is then exercisable if
such number of shares is less than 100).

     

    11

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (ii) The
exercise price shall be paid by any of the following methods or any combination
of the following methods at the election of the Option Holder, or by any other
method approved by the Committee:

     

    (A) in
cash;

     

    (B) by
certified check, cashier’s check or other check acceptable to the Company,
payable to the order of the Company;

     

    (C) if
expressly permitted by a resolution of the Committee applicable to the Option at
or before the time of exercise (whether such resolution is applicable solely to
the Option being exercised or is generally applicable to some or all Options
outstanding under the Plan), by delivery to the Company of certificates
representing the number of Shares then owned by the Option Holder, the Fair
Market Value of which equals the purchase price of the Shares purchased pursuant
to the Option, properly endorsed for transfer to the Company; provided however,
that no Option may be exercised by delivery to the Company of certificates
representing Shares, unless such Shares have been held by the Option Holder for
more than six months (or such other period of time as the Committee determines
is necessary to avoid adverse financial accounting treatment); for purposes of
this Plan, the Fair Market Value of any Shares delivered in payment of the
purchase price upon exercise of the Option shall be the Fair Market Value as of
the exercise date; the exercise date shall be the day of delivery of the
certificates for the Shares used as payment of the Option Price; or

     

    (D) through a
net exercise pursuant to the formula set forth in Subsection 5.1(d), above
unless such net exercise is modified or denied by resolution of the Committee
prior to the grant of the Option.

     

    (h)  Date of
Grant.  An Option shall be considered as having been granted on
the date specified in the grant resolution of the Committee.

     

    (i)  Withholding.

     

    (i)  Non-Qualified
Options.  Upon exercise of an Option, the Option Holder shall
make appropriate arrangements with the Company to provide for the amount of
additional withholding required by Sections 3102 and 3402 of the Code and
applicable state income tax laws, including payment of such taxes through
delivery of Shares of Stock or by withholding Shares to be issued under the
Option, as provided in ARTICLE XIII.

     

    (ii)  Incentive
Options.  If an Option Holder makes a disposition (as defined
in Section 424(c) of the Code) of any Shares acquired pursuant to the
exercise of an Incentive Option prior to the expiration of two years from the
date on which the Incentive Option was granted or prior to the expiration of one
year from the date on which the Option was exercised, the Option Holder shall
send written notice to the Company at the Company’s principal place of business
of the date of such disposition, the number of Shares disposed of, the amount of
proceeds received from such disposition and any other information relating to
such disposition as the Company may reasonably request.  The Option
Holder shall, in the event of such a disposition, make appropriate arrangements
with the Company to provide for the amount of additional withholding, if any,
required by Sections 3102 and 3402 of the Code and applicable state income
tax laws.

     

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    7.3  Restrictions
on Incentive Options   

     

                    
(a)  $100,000 Per Year
Limitation.  The aggregate Fair Market Value of the Shares with
respect to which Incentive Options are exercisable for the first time by an
Option Holder in any calendar year, under the Plan or otherwise, shall not
exceed $100,000 (or such higher amount as may at the time of grant be applicable
under Section 422(d) (or any successor provision) of the Code).  For
this purpose, the Fair Market Value of the Shares shall be determined as of the
date of grant of the Option and Incentive Options shall be taken into account in
the order granted.  The portion of any Incentive Option accelerated in
connection with a Change in Control shall remain exercisable as an Incentive
Option only to the extent the above limitation is not exceeded.  To
the extent such dollar limitation is exceeded, the accelerated portion of such
Incentive Option shall thereafter be exercisable as a Non-Qualified
Option.

     

    (b)  Ten Percent
Stockholders.  Incentive Options granted to an Option Holder
who is the holder of record of 10% or more of the outstanding stock of the
Company shall have an Option Price equal to 110% of the Fair Market Value of the
Shares on the date of grant of the Option and the Option Period for any such
Option shall not exceed five years.

     

    7.4  Transferability.

     

    (a)  General
Rule:  No Lifetime Transfers.  An Option shall not be
transferable by the Option Holder except (i) by will or pursuant to the
laws of descent and distribution or (ii) or to the Option Holder’s former
spouse, to the extent such assignment is pursuant to a Domestic Relations Order
(provided that if the Option being assigned pursuant to a Domestic Relations
Order is an Incentive Option, such Incentive Option shall cease being an
Incentive Option, and shall automatically convert to a Non-Qualified Option,
upon such assignment).  Except as otherwise provided by the terms of a
Qualified Domestic Relations Order, an Option shall be exercisable during the
Option Holder’s lifetime only by him or her, or in the event of Disability or
incapacity, by his or her guardian or legal representative.  The
Option Holder’s guardian or legal representative shall have all of the rights of
the Option Holder under this Plan.

     

    (b)  No
Assignment.  No right or interest of any Option Holder in an
Option granted pursuant to the Plan shall be assignable or transferable during
the lifetime of the Option Holder, either voluntarily or involuntarily, or be
subjected to any lien, directly or indirectly, by operation of law, or
otherwise, including execution, levy, garnishment, attachment, pledge or
bankruptcy, except as set forth above.  In the event the Option is
assigned or transferred in any manner contrary to terms of this Plan, then all
Options transferred or assigned shall immediately terminate.

     

    7.5  Stockholder
Privileges    No
Option Holder shall have any rights as a stockholder with respect to any Shares
covered by an Option until the Option Holder becomes the holder of record of
such Shares, and no adjustments shall be made for dividends or other
distributions or other rights as to which there is a record date preceding the
date such Option Holder becomes the holder of record of such Shares, except as
provided in ARTICLE IV.

     

    ARTICLE
VIII

    RESTRICTED
STOCK AWARDS

     

    8.1  Grant
of Restricted Stock Awards .  Coincident
with or following designation for participation in the Plan, the Committee may
grant a Participant one or more Restricted Stock Awards consisting of Shares of
Stock.  The number of Shares granted as a Restricted Stock Award shall
be determined by the Committee.  Each Restricted Stock Award granted
under the Plan shall be evidenced by a written restricted stock agreement (a
“Restricted
Stock Agreement”).  The Restricted Stock Agreement shall
incorporate and conform to the conditions set forth in this ARTICLE VIII as well
as such other terms and conditions that are not inconsistent as the Committee
may consider appropriate in each case.

     

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    8.2  Restrictions
.  A
Participant’s right to retain a Restricted Stock Award granted to him or her
under Section 8.1 shall be subject to such restrictions, including but not
limited to his or her continuous Service for the Company or an Affiliate for a
restriction period specified by the Committee or the attainment of specified
performance goals and objectives, as may be established by the Committee with
respect to such Award (such restrictions as established by the Committee shall
be known as the “Forfeiture
Restrictions”). The Committee may in its sole discretion provide for
different Forfeiture Restrictions or no Forfeiture Restrictions with respect to
different Participants, to different Restricted Stock Awards or to separate,
designated portions of the Shares constituting a Restricted Stock
Award.  The Committee may in its sole discretion provide for the
earlier lapse of any Forfeiture Restrictions in the event of a Change in Control
in accordance with Article V of this Plan.  Unless explicitly provided
for otherwise in an Award Agreement, if a Participant’s Service terminates for
any reason, any Shares as to which the Forfeiture Restrictions have not been
satisfied (or waived or accelerated as provided herein) shall be forfeited, and
all Shares related thereto shall be immediately returned to the
Company.

     

    8.3  Privileges
of a Stockholder, Transferability.  A
Participant shall have all voting, dividend, liquidation and other rights with
respect to Stock in accordance with its terms received by him or her as a
Restricted Stock Award under this ARTICLE VIII upon his or her becoming the
holder of record of such Stock; provided, however, that the Participant’s right
to sell, encumber, or otherwise transfer such Stock shall be subject to the
limitations of Section 10.2 and ARTICLE XI.

     

    8.4  Enforcement
of Restrictions.  The
Committee shall cause a legend to be placed on the Stock certificates issued
pursuant to each Restricted Stock Award referring to the restrictions provided
by Sections 8.2 and 8.3 and, in addition, may in its sole discretion
require one or more of the following methods of enforcing the restrictions
referred to in Sections 8.2 and 8.3:

     

    (a) Requiring
the Participant to keep the Stock certificates, duly endorsed, in the custody of
the Company while the restrictions remain in effect; or

     

    (b) Requiring
that the Stock certificates, duly endorsed, be held in the custody of a third
party while the restrictions remain in effect.

     

    ARTICLE
IX

    OTHER
GRANTS

     

    From time
to time during the duration of this Plan, the Board may, in its sole discretion,
adopt one or more incentive compensation arrangements for Participants pursuant
to which the Participants may acquire Shares, whether by purchase, outright
grant, or otherwise.  Any arrangement shall be subject to the general
provisions of this Plan and all Shares issued pursuant to such arrangements
shall be issued under this Plan.

     

    ARTICLE
X

    RIGHTS
OF PARTICIPANTS

     

    10.1  Employment
or Service.  Nothing
contained in the Plan or in any Option, or other Award granted under the Plan
shall confer upon any Participant any right with respect to the continuation of
his employment by, or consulting relationship with, or Service with the Company
or any Affiliate, or interfere in any way with the right of the Company or any
Affiliate, subject to the terms of any separate employment agreement or other
contract to the contrary, at any time to terminate such employment, consulting
relationship or Service or to increase or decrease the compensation of the
Participant from the rate in existence at the time of the grant of an
Award.  Whether an authorized leave of absence, or absence in military
or government service, shall constitute a termination of Service shall be
determined by the Committee at that time.

     

     

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    10.2  Nontransferability
of Awards.  Except
as provided otherwise at the time of grant or thereafter, or except as otherwise
provided in a Domestic Relations Order, no right or interest of any Participant
in a Restricted Stock Award (prior to the completion of the restriction period
applicable thereto), or other Award (excluding Options) granted pursuant to the
Plan, shall be assignable or transferable during the lifetime of the
Participant, either voluntarily or involuntarily, or subjected to any lien,
directly or indirectly, by operation of law, or otherwise, including execution,
levy, garnishment, attachment, pledge or bankruptcy.  In the event of
a Participant’s death, a Participant’s rights and interests in Options,
Restricted Stock Awards, and other Awards, shall, to the extent provided in
ARTICLE VII, ARTICLE VIII, and ARTICLE IX be transferable by will or the laws of
descent and distribution, and payment of any amounts due under the Plan shall be
made to, and exercise of any Options may be made by, the Participant’s legal
representatives, heirs or legatees.  However, a Participant’s rights
and interests in Options, Restricted Stock Awards, and other Awards shall be
transferable to an Option Holder’s former spouse, to the extent such assignment
is pursuant to a Domestic Relations Order (provided that if the Option being
assigned pursuant to a Domestic Relations Order is an Incentive Option, such
Incentive Option shall cease being an Incentive Option, and shall automatically
convert to a Non-Qualified Option, upon such assignment).  If in the
opinion of the Committee a person entitled to payments or to exercise rights
with respect to the Plan is disabled from caring for his affairs because of
mental condition, physical condition or age, payment due such person may be made
to, and such rights shall be exercised by, such person’s guardian, conservator
or other legal personal representative upon furnishing the Committee with
evidence satisfactory to the Committee of such status.

     

    10.3  No
Plan Funding  .  Obligations
to Participants under the Plan will not be funded, trusteed, insured or secured
in any manner.  The Participants under the Plan shall have no security
interest in any assets of the Company or any Affiliate, and shall be only
general creditors of the Company.

     

    ARTICLE
XI

    GENERAL
RESTRICTIONS

     

    11.1  Investment
Representations.  The
Company may require any person to whom an Option, Restricted Stock Award, or
other Award, is granted, as a condition of exercising such Option, receiving
such Restricted Stock Award, or such other Award to give written assurances in
substance and form satisfactory to the Company and its counsel to the effect
that such person is acquiring the Stock for his own account for investment and
not with any present intention of selling or otherwise distributing the same,
and to such other effects as the Company or its counsel deems necessary or
appropriate in order to comply with Federal and applicable state securities
laws.  Legends evidencing such restrictions may be placed on the Stock
certificates.

     

    11.2  Compliance
with Securities Laws.  Each
Option, Restricted Stock Award grant, or other Award shall be subject to the
requirement that, if at any time counsel to the Company shall determine that the
listing, registration or qualification of the shares subject to such Option,
Restricted Stock Award, or other Award grant upon any securities exchange or
under any state or federal law, or the consent or approval of any governmental
or regulatory body, is necessary as a condition of, or in connection with, the
issuance or purchase of shares thereunder, such Option, Restricted Stock Award
or other Award may not be accepted or exercised in whole or in part unless such
listing, registration, qualification, consent or approval shall have been
effected or obtained on conditions acceptable to the
Committee.  Nothing herein shall be deemed to require the Company to
apply for or to obtain such listing, registration or qualification.

     

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    11.3  Changes
in Accounting or Tax Rules.  Except
as provided otherwise at the time an Award is granted, notwithstanding any other
provision of the Plan to the contrary, if, during the term of the Plan, any
changes in the financial or tax accounting rules applicable to Options,
Restricted Stock Awards, or other Awards shall occur which, in the sole judgment
of the Committee, may have a material adverse effect on the reported earnings,
assets or liabilities of the Company, the Committee shall have the right and
power to modify as necessary, any then outstanding and unexercised Options,
outstanding Restricted Stock Awards and other outstanding Awards as to which the
applicable services or other restrictions have not been satisfied.

     

    11.4  Stockholder
Agreements.  If
the Company has one or more stockholder agreements in effect at the time of
grant or exercise of an Award under the Plan, then the Committee shall, if the
Company is contractually obligated to, and may, in its discretion, condition the
grant or exercise (as applicable) of any such Award upon execution by the
Participant of such stockholder agreement(s), such that the Participant shall
become a party to such stockholder agreements(s) concurrently with such grant or
exercise (as applicable) of any such Award.

     

    11.5  Lock-Up
Period.  The
Award Agreement may, as determined by the Committee in its sole discretion,
include a provision requiring that, if requested by the Company or any Affiliate
or the representative of the underwriters of Stock (or other securities) of the
Company or any Affiliate, the Participant shall not directly or indirectly sell,
offer to sell, contract to sell, pledge, transfer or otherwise dispose of, make
any short sale of, grant any option for the purchase or sale of, or enter into
any hedging or similar transaction with the same economic effect as a sale of,
any Stock (or other securities) of the Company or any Affiliate held by such
Participant (other than those included for sale in the registration) for a
period specified by the representative of the underwriters of Stock (or other
securities) of the Company or any such Affiliate not to exceed 180 days
following the effective date of a registration statement of the Company or any
Affiliate filed under the Securities Act.  If requested by the Company
or any Affiliate or the representative of the underwriters of Stock (or other
securities) of the Company or any Affiliate, the Participant would be required
to enter into an agreement regarding his or her compliance with this requirement
that will survive the term of the Award Agreement.

     

    ARTICLE
XII

    PLAN AMENDMENT, MODIFICATION AND
TERMINATION

     

    The Board
may at any time or from time to time, with or without prior notice, amend,
modify, suspend or terminate the Plan provided, however, that no amendment or
modification may become effective without approval of the amendment or
modification by the stockholders if stockholder approval is required to enable
the Plan to satisfy any applicable statutory or regulatory requirements, or if
the Company, on the advice of counsel, determines that stockholder approval is
otherwise necessary or desirable.  No amendment, modification or
termination of the Plan shall in any manner adversely affect any Options,
Restricted Stock Awards, or other Award theretofore granted under the Plan,
without the consent of the Participant holding such Options, Restricted Stock
Awards, or other Awards. Notwithstanding the foregoing or anything to the
contrary in this Plan, the Board may amend or modify the terms of the Plan or an
Award Agreement, retroactively or prospectively, as permitted under
Section 11.3 (Changes in Accounting or Tax Rules) or Section 14.3
(Section 409A) hereof with or without the consent of the
Participant.

     

     

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    ARTICLE
XIII

    WITHHOLDING

     

    13.1  Withholding
Requirement.  The
Company or any Affiliate, as the case
may be, shall have the right to deduct from payments of any kind otherwise due
to a Participant, or to condition the Company’s obligations to deliver Shares
upon the exercise of any Option, the vesting of any Restricted Stock Award or
lapse of Forfeiture Restrictions or Repurchase Rights, or the grant of Stock
upon the payment by the Participant of, any federal, state, local or foreign
taxes of any kind required by law with respect to the grant or issuance of, or
the vesting of or other lapse of restrictions applicable to, the applicable
Award or the Shares subject to, or issuable upon exercise of, such
Award.  At the time of such grant, issuance, vesting or lapse, the
Participant shall pay to the Company or Affiliate, as the case may be, any
amount that the Company or Affiliate may reasonably determine to be necessary to
satisfy such withholding obligation.

     

    13.2  Withholding
With Stock.  At
the time the Committee grants an Option, Restricted Stock Award, other Award, or
Stock or at any time thereafter, the Committee may, in its sole discretion,
grant the Participant an election to pay all such amounts of tax withholding, or
any part thereof, by electing (a) to have the Company withhold from shares
otherwise issuable to the Participant, shares of Stock having a value equal to
the amount required to be withheld or such lesser amount as may be elected by
the Participant; provided however, that the amount of Stock so withheld shall
not exceed the minimum amount required to be withheld under the method of
withholding that results in the smallest amount of withholding, or (b) to
transfer to the Company a number of shares of Stock that were acquired by the
Participant more than six months prior to the transfer to the Company and that
have a value equal to the amount required to be withheld or such lesser amount
as may be elected by the Participant.  All elections shall be subject
to the approval or disapproval of the Committee.  The value of shares
of Stock to be withheld shall be based on the Fair Market Value of the Stock on
the date that the amount of tax to be withheld is to be determined (the “Tax
Date”).  Any such elections by Participants to have shares of
Stock withheld for this purpose will be subject to the following
restrictions:

     

    (a) All
elections must be made prior to the Tax Date.

     

    (b) All
elections shall be irrevocable.

     

    (c) If the
Participant is an officer or director of the Company within the meaning of and
is subject to Section 16 of the Exchange Act (“Section 16”),
the Participant must satisfy the requirements of such Section 16 and any
applicable Rules thereunder with respect to the use of Stock to satisfy such tax
withholding obligation.

     

    ARTICLE
XIV

    REQUIREMENTS
OF LAW

     

    14.1  Requirements
of Law.  The
issuance of Stock and the payment of cash pursuant to the Plan shall be subject
to all applicable laws, rules and regulations.

     

    14.2  Federal
Securities Law Requirements.  If
a Participant is an officer or director of the Company within the meaning of and
subject to Section 16, Awards granted hereunder shall be subject to the
reporting requirements under Section 16(a) (which is the obligation of the
Participant) as well as all conditions required under Rule 16b-3, or any
successor rule promulgated under the Exchange Act, to qualify the Award for any
exception from the provisions of Section 16(b) of the Exchange Act
available under that Rule.  Such conditions shall be set forth in the
agreement with the Participant which describes the Award or other document
evidencing or accompanying the Award.

     

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    14.3  Section
409A.  Notwithstanding
anything in this Plan to the contrary, the Plan and Awards made under the Plan
are intended to comply with the requirements imposed by Section 409A of the
Code.  If any Plan provision or Award would result in the imposition
of an additional tax under Section 409A of the Code, the Company and the
Participant intend that the Plan provision or Award will be reformed to avoid
imposition, to the extent possible, of the applicable tax and no action taken to
comply with Section 409A of the Code shall be deemed to adversely affect the
Participant’s rights to an Award.  The Participant further agrees that
the Committee, in the exercise of its sole discretion and without the consent of
the Participant, may amend or modify an Award in any manner and delay the
payment of any amounts payable pursuant to an Award to the minimum extent
necessary to meet the requirements of Section 409A of the Code as the
Committee deems appropriate or desirable.

     

    14.4  Participant’s
Representations.  By
accepting an Award hereunder, each Participant acknowledges that the Company has
advised such Participant to discuss the grant of such Award with the
Participant’s tax, legal, investment, and other advisors as the Participant and
such advisors determine to be appropriate, and that such consultation shall
include (to the extent determined by the Participant and such advisors to be
appropriate or necessary) a discussion of the advisability of making an election
under Section 83 of the Code.

     

    14.5  Governing
Law.  The
Plan and all agreements hereunder shall be construed in accordance with and
governed by the laws of the State of Colorado excluding its conflict of laws
rules.

     

    ARTICLE
XV

    DURATION
OF THE PLAN

     

    Unless
sooner terminated by the Board of Directors, the Plan shall terminate at the
close of business on the day immediately following the tenth anniversary of the
Effective Date and no Option, Restricted Stock Award, other Award or Stock shall
be granted, or offer to purchase Stock made, after such
termination.  Options, Restricted Stock Awards, and other Awards
outstanding at the time of the Plan termination may continue to vest, be
exercised, or otherwise become free of restrictions, or be paid, in accordance
with their terms.

     

    ARTICLE
XVI

    EFFECTIVENESS
OF THE PLAN

     

    This Plan
will not be effective, and no Award granted hereunder will be effective,
exercisable, or vest until after this Plan is approved by at least a majority of
the shareholders of the Company voting at a meeting at which a quorum is
present, which approval must occur, if at all, within one year of the date this
Plan is adopted by the Board of Directors.  If the shareholders do not
approve this Plan within such time period, this Plan and all Awards made
hereunder will terminate and be considered void ab initio.

     

    Dated as
of the Effective Date:

     

    GOLDEN
EAGLE INTERNATIONAL, INC.

     

    a
Colorado corporation

     

    By:                                                                           

    Terry C.
Turner, President

    

    18golden_8k-turner.htm

    Exhibit 10.2 

      

      EXECUTIVE
EMPLOYMENT AGREEMENT

      

                  
THIS EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”), effective October ___, 2009
(“Effective Date”), is made between Golden Eagle International, Inc., a Colorado
corporation (“Employer”), and Terry C. Turner (“Executive”), but the
effectiveness of its terms is subject to approval by the shareholders of the
Employer as set forth in Section 22, below.

       

      RECITALS

       

      WHEREAS, the Board of
Directors of Employer desires to provide for the continued employment of
Executive.  Executive is willing to commit himself to continue to
serve Employer, on the terms and conditions herein provided, although this
Agreement may be amended at any time by written agreement among the parties;
and

       

      WHEREAS, in order to effect
the foregoing, Employer and Executive wish to enter into this Agreement on the
terms and conditions set forth below.

       

      AGREEMENT

       

      NOW, THEREFORE, in
consideration of the mutual covenants herein contained, and other good and
valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, the parties agree as follows:

       

      1.           Employment.  Employer
hereby employs Executive, and Executive agrees to be employed as President and
Chief Executive Officer.  Executive will report to the Board of
Directors.  Changes may be made from time to time by Employer, in its
sole discretion, to the duties, reporting relationships and title of
Executive.  Executive will devote full time and attention to achieving
the purposes and discharging the responsibilities of his
position.  Executive will comply with all rules, policies and
procedures of Employer as modified from time to time, including without
limitation, rules and procedures set forth in the Employer’s employee manuals
and handbooks, supervisor’s manuals and operating manuals.  Executive
will perform all of Executive’s responsibilities in compliance with all
applicable laws and will ensure that the operations that Executive manages are
in compliance with all applicable laws.  During Executive’s
employment, Executive will not engage in any other business activity that, in
the reasonable judgment of the Board of Directors, conflicts with the duties of
Executive under this Agreement, whether or not such activity is pursued for
gain, profit or other pecuniary advantage.

       

      2.           Term of
Employment.  The term of employment (“Term”) shall be for three
years from the Effective Date unless terminated earlier in accordance with the
terms and conditions of this Agreement or unless the shareholders of the
Employer do not approve this Agreement by not later than October 7, 2010 as
required by Section 22 hereof (at which time this Agreement will terminate
automatically without liability of either the Employer to the Executive or the
Executive to the Employer if the shareholders o the Employer have not approved
its terms by such date.  Assuming the approval by the shareholders of
the terms of this Agreement, following expiration of the Term as set forth above
the Term of this Agreement will automatically renew for successive one-year
terms unless and until the Employer or the Employee provides notice at least 60
days in advance of the expiration of the current Term that the Employer or the
Employee will not accept a renewal term.

       

       

      1

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      3.           Compensation.  For
the duration of Executive’s employment hereunder, the Executive will be entitled
to compensation that will be computed and paid pursuant to the following
subparagraphs.

       

      3.1           Base
Salary.  Employer will pay to Executive a base salary (“Base
Salary”) at an annual rate of $180,000.00, subject to withholdings, ratably in
accordance with Employer’s policies, so long as Executive remains
employed.  Executive’s Base Salary will be reviewed annually during
the term of Executive’s employment and may be adjusted based on such
review.  Any increase made to the Base Salary shall be in the sole
discretion of Employer.  Executive’s Base Salary will not be reduced
by Employer unless a material adverse change in the financial condition or
operations of Employer has occurred or unless Executive’s responsibilities are
altered to reflect less responsibility.

       

      3.2           Discretionary Cash
Bonus.  Executive shall be eligible for a discretionary cash
bonus (“Cash Bonus”) equal to an amount as determined by the Compensation
Committee of the Board of Directors (the “Committee,” which term, when used
herein, shall include the entire Board of Directors in the absence of a
Compensation Committee) and shall be based on the condition of Employer’s
business and results of operations, the Committee’s evaluation of Executive’s
individual performance for the relevant period, and the satisfaction of goals
that may be established by the Committee.  Each Cash Bonus shall be
paid in the Committee’s discretion.

       

      3.4           Equity-based
Compensation.  Executive shall be entitled to participate in
all equity-based compensation plans offered by Employer and as determined by the
Committee.  Executive understand that as of the date of this
Agreement, the only equity-based plan offered by Employer is the Incentive Share
Option Plan.

       

      3.5           Performance
Standards.  The Executive and the Employer agree that the
Executive’s discretionary cash bonus and equity-based compensation will be based
on the Executive’s and the Employer’s achievement of performance goals that may
be established by the Committee after discussion with the Executive and his
supervisors (if any).  Until the Employer and the Committee establish
performance goals, the Executive’s discretionary cash bonus and equity based
compensation will be wholly discretionary.

       

      4.           Other
Benefits.

       

      4.1           Certain
Benefits.  Executive will be eligible to participate in all
employee benefit programs established by Employer that are applicable to
management personnel on a basis commensurate with Executive’s position and in
accordance with Employer’s policies from time to time, but nothing herein shall
require the adoption or maintenance of any such plan.  Notwithstanding
the foregoing, Employer shall provide full medical and dental insurance coverage
for Executive.  Employer shall also provide to Executive one parking
space near Employer’s corporate office on a yearly basis, and Employer will pay
all related parking fees.

       

       

      2

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      4.2           Vacations, Holidays and
Expenses.  For the duration of Executive’s employment
hereunder, Executive will be provided such holidays, sick leave and vacation as
Employer makes available to its management level employees
generally.  Employer will reimburse Executive in accordance with
company policies and procedures for reasonable expenses necessarily incurred in
the performance of duties hereunder against appropriate receipts and vouchers
indicating the specific business purpose for each such expenditure.

       

      4.3           Right of
Set-off.  By accepting this Agreement, Executive consents to a
deduction from any amounts Employer owes Executive from time to time (including
amounts owed to Executive as wages or other compensation, fringe benefits, or
vacation pay, as well as any other amounts owed to Executive by Employer), to
the extent of the amounts Executive owes to Employer.  Whether or not
Employer elects to make any set-off in whole or in part, if Employer does not
recover by means of set-off the full amount Executive owes it, calculated as set
forth above, Executive agrees to pay immediately the unpaid balance to
Employer.

       

      5.           Termination
or Discharge By Employer.

       

                                     
5.1           For Cause.  Employer
will have the right to immediately terminate Executive’s services and this
Agreement for “Cause.”  “Cause” shall be determined in the discretion
of Employer, and shall mean Executive:  (i) has engaged in gross
negligence,  incompetence or willful misconduct in the performance of
his duties, (ii) has refused, without proper reason, to perform his duties,
(iii) has willfully engaged in conduct that is materially injurious to Employer
or its subsidiaries (monetarily or otherwise), (iv) has committed an act of
fraud, embezzlement or willful breach of a fiduciary duty to Employer or an
affiliate (including the unauthorized disclosure of Confidential Information, as
such term is defined in Section 8 of this Agreement, or the unauthorized
disclosure of proprietary material information of Employer or an affiliate) or,
(v) has been convicted of (or pleaded no contest to) a crime involving fraud,
dishonesty or moral turpitude or any felony.

       

      Upon termination of Executive’s
employment hereunder for Cause, Executive will have no rights to any unvested
benefits or any other compensation or payments after the termination
date.

       

      5.2           Without Cause, Death, or
Disability.  Employer may terminate Executive’s employment
under this Agreement without Cause and without advance notice; provided, however, that if the
termination by Employer without Cause is prior to expiration of the original
term, or if Executive’s employment is terminated by Executive’s death or
disability, Employer will pay, as severance pay, Executive’s Base Salary at the
rate in effect on the termination date for a period of 6 months, plus one month
for each year that Executive has been with the Company, or through expiration of
the original term, whichever is a shorter period of time; provided,
however, that in any event the Executive shall be entitled to a minimum
of 12 months of severance pay.

       

       

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      (a)           Such
payments will be made no later than 60 days following the date of Termination of
Executive, and will be subject to all appropriate deductions and
withholdings.  Upon termination of Executive without Cause or for
death or disability, all unvested benefits (whether equity or cash benefits and
bonuses) previously granted to the Executive will vest immediately upon such
termination.

       

      (b)           For
purposes of this Agreement, “disability” means the incapacity or inability of
Executive, whether due to accident, sickness or otherwise, as determined by a
medical doctor acceptable to the Board of Directors of Employer and confirmed in
writing by such doctor, to perform the essential functions of Executive’s
position under this Agreement, with or without reasonable accommodation for an
aggregate of 90 days during any period of 180 consecutive days, or such longer
period as may be required under applicable law.

       

      (c)           Notwithstanding
the foregoing, in the event of a termination by Employer without Cause during
the 12-month period following a “Change of Control,” as defined under Section
6.2 below, then the compensation to Executive provided under Section 6.2 shall
govern. The Executive agrees that his eligibility to receive any and all amounts
described in this Section 5.2 shall be subject to and contingent upon the
Executive’s execution of a full and complete general release in favor of
Employer and its affiliated persons and entities, reasonably satisfactory to
Employer in its sole discretion.

       

      6.           Termination
By Executive.

       

      6.1           Termination By Executive for Good
Reason.  Executive shall have the right to terminate this
Agreement for “Good Reason.”  “Good Reason” shall mean any one of the
conditions set forth below, provided that Executive must provide notice to the
Employer within ninety (90) days of the existence of such condition and the
Employer will have thirty (30) days from receipt of such notice to remedy the
condition.  If the condition is not remedied within such 30 day
period, the following conditions will constitute “Good Reason”:

       

      
        	
                 
      

              	
                (i)  Employer’s
      material breach of the terms of this Agreement or any other written
      agreement between Executive and
Employer;

              

      

      

      
        	
                 
      

              	
                (ii)
      the assignment to Executive (without the Executive’s consent) of any
      duties that are substantially inconsistent with or materially diminish
      Executive’s position, as such position was defined on the Effective Date
      of this Agreement or immediately prior to a Change of Control, as such
      term is defined in Section 6.2 of this Agreement;
  or

              

      

      

      
        	
                 
      

              	
                (iii)
      a requirement that Executive (without the Executive’s consent) be based at
      any office or location more than 50 miles from Executive’s primary work
      location, as such position was defined on the Effective Date of this
      Agreement or immediately prior to a Change of Control, as such term is
      defined in Section 6.2 of this Agreement (not including reasonable travel
      by the Executive consistent with the travel obligations of similar
      executives holding similar positions with similar
      responsibilities).

              

      

       

       

      4
 

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      In the event Executive terminates this
Agreement for Good Reason, compensation shall be provided to the Executive in
such amounts and on such terms as set forth in Section 6.2 of this
Agreement.  Notwithstanding the foregoing, in the event that the
Executive’s employment is terminated for any reason other than for Cause or as a
result of the Executive’s death or disability (and for clarity, shall include
termination by Executive for Good Reason), during the 12-month period following
a Change of Control, then the compensation to Executive provided under Section
6.2 shall govern.

       

      6.2           Termination by Executive due to
Change of Control.  For purposes of this Agreement, a “Change
of Control” shall mean the happening of any of the following:

       

      (i) Any
“Person” (as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”) is or becomes the
“Beneficial Owner” (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of Employer representing more than 50% of the total
voting power represented by Employer’s then outstanding voting securities without the approval of not
fewer than two-thirds of the Board of Directors of Employer voting on such
matter, unless the Board of Directors specifically designates such acquisition
to be a change of control;

       

      (ii) A
merger or consolidation of Employer whether or not approved by the Board of
Directors of Employer, other than a merger or consolidation that would result in
the voting securities of Employer outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
or into voting securities of the surviving entity) at least 50% of the total
voting power represented by the voting securities of Employer or such surviving
entity outstanding immediately after such merger or consolidation, or the
shareholders of Employer approve a plan of complete liquidation of Employer or
an agreement for the sale or disposition by Employer of all or substantially all
of Employer’s assets; or

       

      (iii) As
result of the election of members to the Board of Directors, a majority of the
Board of Directors consists of persons who are not members of the Board of
Directors as of the Effective Date (including Executive as a member of the Board
of Directors as of the Effective Date), except in the event that such slate of
directors is proposed by the Committee.

       

      In the
event that Executive’s employment is terminated for any reason (not including,
however, a termination by the Employer for Cause or a termination as a result of
the Executive’s death or disability (and for clarity, shall include termination
by Executive for Good Reason)) during the 12-month period following a Change of
Control, Employer shall pay Executive, within 60 days following the date of such
termination, a cash severance payment in a lump sum in an amount equal to that
severance pay to which Executive would be entitled under paragraph 5.2, or 2
times the sum of (a) the current annual base salary of the Executive and (b) the
amount of the most recent discretionary bonus paid to the Executive pursuant to
Section 3.2 of this Agreement less applicable withholding, whichever sum is
greater.  In addition, in the event of a Change of Control, all of
Executive’s equity-based compensation shall immediately vest regardless whether
the Executive is retained by the Employer or successor following the Change of
Control.

       

       

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      7.           Covenant Not To
Compete.  A restricted period (“Restricted Period”) shall exist
during Executive’s continued employment hereunder and during the twelve-month
period following termination of Executive’s employment for any reason other than
a Change of Control, Termination By Executive For Good Reason, or Termination by
the Employer Without Cause or for Disability, in which case the Restricted
Period is six months.  During this Restricted Period, Executive shall
not, without the prior written consent of Employer, directly or indirectly
engage in or become associated with a Competitive Activity.  For
purposes of this Agreement: (i) a “Competitive Activity” means, as of the
Termination Date, any business or other endeavor of a kind being conducted by
Employer or any of its subsidiaries or affiliates (or demonstrably anticipated
by Employer or its subsidiaries or affiliates) in a geographic area that is
within ten miles of (a) any property that is owned, leased or controlled by
Employer at any time during the term of this Agreement or (b) any oil or gas or
other mineral prospect that the Employer is evaluating or seeking to acquire an
interest in at the time of termination of the Executive’s employment; and (ii)
Executive shall be considered to have become “associated with a Competitive
Activity” if Executive becomes directly or indirectly involved as an owner,
principal, employee, officer, director, independent contractor, representative,
stockholder, financial backer, agent, partner, advisor, lender, or in any other
individual or representative capacity with any individual, partnership,
corporation or other organization that is engaged in a Competitive
Activity.  Notwithstanding the foregoing, Executive may make and
retain investments during the Restricted Period, for investment purposes only,
in less than 5% of the outstanding capital stock of any publicly-traded
corporation engaged in a Competitive Activity if stock of such corporation is
either listed on a national stock exchange or on the OTC Bulletin Board if
Executive is not otherwise affiliated with such corporation. The Executive’s
ownership of interests in properties producing oil and gas or minerals, or
milling operations (whether a working interest, royalty interest, or other
interest) acquired prior to the date hereof is not considered a Competing
Activity.

       

      Employer and Executive agree to the
following: this provision does not impose an undue hardship on Executive and is
not injurious to the public; this provision is necessary to protect the business
of Employer and its affiliates; the nature of Executive’s responsibilities with
Employer under this Agreement require Executive to have access to Confidential
Information, as such term is defined in Section 9 of this Agreement, which is
valuable and confidential to all of the business; the scope of this Section 7 is
reasonable in terms of length of time and geographic scope; and adequate
consideration supports this Section 7, including consideration
herein.

       

      In the event that any of the covenants
in this Section 7 shall be determined by any court of competent jurisdiction to
be unenforceable by reason of extending for too great a period of time or over
too great a geographical area or by reason of being too extensive in any other
respect, it shall be interpreted to extend over the maximum period of time for
which it may be enforceable and to the maximum extent in all other respects as
to which it may be enforceable, and enforced as so interpreted, all as
determined by such court in such action.  Executive acknowledges the
uncertainty of the law in this respect and expressly stipulates that this
Agreement is to be given the construction that renders its provisions valid and
enforceable to the maximum extent (not exceeding its express terms) possible
under applicable law.

       

       

      
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      8.           Non-solicitation.  Executive
agrees that (i) during the twelve-month period following the termination of the
Executive’s employment, Executive shall not, without the prior written consent
of Employer, directly or indirectly, hire, recruit or solicit the employment or
services of (whether as an employee, officer, director, agent, consultant or
independent contractor), or encourage to change such person’s relationship with
Employer or any of its subsidiaries or affiliates, any employee, officer,
director, agent, consultant or independent contractor of Employer or any of its
subsidiaries or affiliates, provided, however, that a
general solicitation of the public for employment shall not constitute a
solicitation hereunder so long as such general solicitation is not designed to
target, or does not have the effect of targeting, any employee, officer,
director, agent, consultant or independent contractor of Employer or any of its
subsidiaries or affiliates; (ii) Executive will not convey any information
(whether confidential or otherwise) or trade secrets about any employees,
officers, directors, agents, consultants and independent contractors of Employer
or any of its subsidiaries or affiliates to any other person; and (iii) during
the Restricted Period, Executive shall not, without the prior written consent of
Employer, directly or indirectly, solicit, attempt to do business with, or do
business with any customers of, suppliers to, business partners of or business
affiliates of Employer or any of its subsidiaries or affiliates (such customers,
suppliers, partners and affiliates, collectively, “Trade Relationships”) on
behalf of any entity engaged in a Competitive Activity, or encourage (regardless
of who initiates the contact) any Trade Relationship to use the services of any
competitor of Employer or its subsidiaries or affiliates, or encourage any Trade
Relationship to change its relationship with Employer or its subsidiaries or
affiliates.

       

      9.           Confidentiality. Executive
acknowledges that, during the course of Executive’s employment with Employer,
Executive may have developed Confidential Information (as defined below) for
Employer, and Executive may have learned of Confidential Information developed
or owned by Employer or its affiliates or entrusted to Employer or its
affiliates by others.  Executive agrees that Executive will not,
directly or indirectly, use any Confidential Information or disclose it to any
other person or entity, except as otherwise required by law.

       

      “Confidential
Information” means any and all information relating to Employer that is not
generally known by the public or others with whom Employer does (or plans to)
compete or do business, as well as comparable information relating to any of
Employer’s affiliates.  Confidential Information includes, but is not
limited to, information relating to the terms of this Agreement, as well as
Employer’s business, technology, practices, products, marketing, sales,
services, finances, strategic opportunities, internal strategies, legal affairs
(including pending litigation), the terms of business relationships not yet
publicly known, intellectual property and the filing or pendency of patent
applications.  Confidential Information also includes, but is not
limited to, comparable information that Employer may receive or has received
belonging to customers, suppliers, consultants and others who do business with
Employer, or any of Employer’s affiliates.

       

       

      7

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      “Confidential Information” does not
include any information that is: (i) shown to have been developed independently
by Executive prior to Executive’s employment with Employer; or (ii) required by
a judicial tribunal or similar governmental body to be disclosed under law
(provided that Executive have first promptly notified Employer of such
disclosure requirement and have cooperated fully with Employer (at Employer’s
expense) in exhausting all appeals

       

      10.           Property of
Employer.  Upon any termination from Employer, Executive agrees
to return to Employer any and all records, files, notes, memoranda, reports,
work product and similar items, and any manuals, drawings, sketches, plans, tape
recordings, computer programs, disks, cassettes and other physical
representations of any information, relating to Employer, or any of its
affiliates, whether or not constituting confidential information; and Executive
agrees to return to Employer any other property, including but not limited to a
laptop computer, belonging to Employer, no later than the date of Executive’s
termination from employment for any reason, and Executive further agrees not to
retain copies of any Confidential Information.

       

      11.           Section 280G Safe Harbor
Cap.  In the event it shall be determined that any payment or
distribution or any part thereof of any type to or for the benefit of Executive
whether pursuant to the Agreement or any other agreement between Executive and
the Employer, or any person or entity that acquires ownership or effective
control the Employer or ownership of a substantial portion of the Employer’s
assets (within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended, and the regulations thereunder (the “Code”)) whether paid or
payable or distributed or distributable pursuant to the terms of the Agreement
or any other agreement, (the “Total Payments”), is or will be subject to the
excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the
Total Payments shall be reduced to the maximum amount that could be paid to
Executive without giving rise to the Excise Tax (the “Safe Harbor Cap”), if the
net after-tax payment to Executive after reducing Executive’s Total Payments to
the Safe Harbor Cap is greater than the net after-tax (including the Excise Tax)
payment to Executive without such reduction.  The reduction of the amounts
payable hereunder, if applicable, shall be made by reducing first the payment
made pursuant to the Agreement and then to any other agreement that triggers
such Excise Tax, unless an alternative method of reduction is elected by
Executive.  All mathematical determinations, and all determinations as to
whether any of the Total Payments are “parachute payments” (within the meaning
of Section 280G of the Code), that are required to be made under this
Section 11, including determinations as to whether the Total Payments to
Executive shall be reduced to the Safe Harbor Cap and the assumptions to be
utilized in arriving at such determinations, shall be made by a nationally
recognized accounting firm selected by the Employer (the “Accounting
Firm”).  If the Accountant determines that the Total Payments to Executive
shall be reduced to the Safe Harbor Cap (the “Cutback Payment”) and it is
established pursuant to a final determination of a court or an Internal Revenue
Service (the “IRS”) proceeding which has been finally and conclusively resolved,
that the Cutback Payment is in excess of the limitations provided in
Section 6(e) (hereinafter referred to as an “Excess Payment”), such Excess
Payment shall be deemed for all purposes to be an overpayment to Executive made
on the date such Executive received the Excess Payment and Executive shall repay
the Excess Payment to the Employer on demand; provided, however, if Executive
shall be required to pay an Excise Tax by reason of receiving such Excess
Payment (regardless of the obligation to repay the Employer), Executive shall
not be required to repay the Excess Payment (if Executive has already repaid
such amount, the Employer shall refund the amount to the Executive), and the
Employer shall pay Executive an amount equal to the difference between the Total
Payments and the Shortfall Cap.

       

       

      8

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      12.           Remedies.                      Notwithstanding
other provisions of this Agreement regarding dispute resolution, Executive
agrees that Executive’s violation of any of Sections 7, 8, 9 or 10 of this
Agreement would cause Employer irreparable harm that would not be adequately
compensated by monetary damages and that an injunction may be granted by any
court or courts having jurisdiction, restraining Executive from violation of the
terms of this Agreement, upon any breach or threatened breach of Executive of
the obligations set forth in any of the Sections 7, 8, 9 or 10.  The
preceding sentence shall not be construed to limit Employer from any other
relief or damages to which it may be entitled as a result of Employee’s breach
of any provision of this Agreement, including Sections 7, 8, 9 or
10.  Employee also agrees that a violation of any of Sections 7, 8, 9
or 10 would entitle Employer, in addition to all other remedies available at law
or equity, to recover from Executive any and all funds, including, without
limitation, wages, salary and profits, which will be held by Executive in
constructive trust for Employer, received by Executive in connection with such
violation.

       

      13.           Arbitration.  If any
dispute shall arise between Executive and Employer in connection with this
Agreement, and such dispute cannot be resolved amicably by the parties, the same
shall be conclusively and finally resolved by binding arbitration. Any party
hereto may commence an arbitration proceeding by providing written notice to the
other party requesting the arbitration of an unresolved dispute. Each such
dispute, if any, shall be submitted to an arbitrator acceptable to both parties.
If either Executive or Employer refuses or neglects to agree to appoint an
arbitrator within 30 days after receipt of written notice from the other party
requesting the other party to do so, the Judicial Arbiter Group, Inc., Denver,
Colorado (www.jaginc.com) may appoint such arbitrator. The arbitrator shall be
experienced in the subject matter of the dispute. Except as otherwise
specifically set forth herein, the arbitrators shall conduct the arbitration in
accordance with the rules of the Judicial Arbiter Group, Inc. The decision in
writing of the arbitrator, when filed with the parties hereto, shall be final
and binding on both parties. Judgment may be entered upon the final decision of
the arbitrator in any court having jurisdiction.  Such arbitration
shall take place in Denver, Colorado.

       

      14.           Fees.  Unless
otherwise agreed, the prevailing party will be entitled to its costs and
attorneys’ fees incurred in any litigation or dispute relating to the
interpretation or enforcement of this Agreement.

       

      15.           Disclosure.  Executive
agrees fully and completely to reveal the terms of this Agreement to any future
employer or potential employer of Executive and authorizes Employer, at its
election, to make such disclosure.

       

      16.           Representation of
Executive.  Executive represents and warrants to Employer that
Executive is free to enter into this Agreement and has no contract, commitment,
arrangement or understanding to or with any party that restrains or is in
conflict with Executive’s performance of the covenants, services and duties
provided for in this Agreement.  Executive agrees to indemnify
Employer and to hold it harmless against any and all liabilities or claims
arising out of any unauthorized act or acts by Executive that, the foregoing
representation and warranty to the contrary notwithstanding, are in violation,
or constitute a breach, of any such contract, commitment, arrangement or
understanding.  Executive further represents and warrants to Employer
that Executive has consulted with his legal, tax, accounting, and investment
advisors with respect to the advisability of entering into this agreement to the
extent that the Executive has determined such consultation to be necessary or
appropriate.

       

      9

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      17.           Assignability.  During
Executive’s employment, this Agreement may not be assigned by either party
without the written consent of the other; provided, however, that Employer may
assign its rights and obligations under this Agreement without Executive’s
consent to a successor by sale, merger or liquidation, if such successor carries
on the Employer’s business substantially in the form in which it is being
conducted at the time of the sale, merger or liquidation.  This
Agreement is binding upon Executive, Executive’s heirs, personal representatives
and permitted assigns and on Employer, its successors and assigns.

       

      18.           Notices.  For
purposes of this Agreement, notices and all other communications provided for
herein shall be in writing and shall be deemed to have been duly given when
personally delivered or when mailed by United States registered or certified
mail, return receipt requested, postage prepaid, addressed as
follows:

       

      
        	
                IF
      TO EMPLOYER TO:

              	
                9661
      South 700 East

                Salt
      Lake City, UT 84070

                 

              
	
                IF
      TO EXECUTIVE TO:

              	
                13803
      Magic Wand Street

                Draper,
      UT 84020

                 

              

      

      

       

      19.           Severability.  If
any provision of this Agreement or compliance by any of the parties with any
provision of this Agreement constitutes a violation of any law, or is or becomes
unenforceable or void, then such provision, to the extent only that it is in
violation of law, unenforceable or void, shall be deemed modified to the extent
necessary so that it is no longer in violation of law, unenforceable or void,
and such provision will be enforced to the fullest extent permitted by
law.  If such modification is not possible, said provision, to the
extent that it is in violation of law, unenforceable or void, shall be deemed
severable from the remaining provisions of this Agreement, which provisions will
remain binding on the parties.

       

      20.           Waivers.  No failure
on the part of either party to exercise, and no delay in exercising, any right
or remedy hereunder will operate as a waiver thereof; nor will any single or
partial waiver of a breach of any provision of this Agreement operate or be
construed as a waiver of any subsequent breach; nor will any single or partial
exercise of any right or remedy hereunder preclude any other or further exercise
thereof or the exercise of any other right or remedy granted hereby or by
law.

       

       

      10

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      21.           Governing Law.  The
validity, construction and performance of this Agreement shall be governed by
the laws of the State of Utah without regard to the conflicts of law provisions
of such laws.

       

      22.           Board
Approval.  This Agreement was approved by the Board of
Directors of the Employer on October 7, 2009.  This Agreement is not
effective until approved by the shareholders of the Employer.

       

      23.           Entire
Agreement.  This instrument contains the entire agreement of
the parties with respect to the relationship between Executive and Employer and
supersedes all prior agreements and understandings, and there are no other
representations or agreements other than as stated in this Agreement related to
the terms and conditions of Executive’s employment.  This Agreement
may be changed only by an agreement in writing signed by the party against whom
enforcement of any waiver, change, modification, extension or discharge is
sought, and any such modification will be signed by the Chairman of the
Committee.  Upon approval by the shareholders of the Employer, all
prior agreements between the Employer and the Executive for the employment of
the Executive shall be immediately cancelled and terminated and of no further
force or effect.

       

      [Signature
Page Follows]

       

       

       

       

       
11

      
        
          
             

          

           

        

        
           

          
            

          

        

        
           

        

      

      

       

      IN WITNESS WHEREOF, the
parties have duly signed and delivered this Agreement as of the day and year
first above written.

       

      

       

       

      

      
        	 
      	 
      	 
      
	 
      	
                 

                 

                 

                 

                 

                 

                 

                By:

                 

              	
                EMPLOYER:

                 

                /s/  Tracy A. Madsen

                Tracy
      A. Madsen, Chief Financial Officer

                and
      Vice President for U.S. Administration

                 

                 

                 /s/  Harlan M. (Mac)
      DeLozier

                Chairman,
      pro tem, Board of Directors

                 

                 

                EXECUTIVE:

                 

                /s/Terry C.
      Turner

                Terry
      C. Turner

              

      

       

       

       

       

      12

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