Document:

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B2 HEALTH, INC.

2006 EQUITY INCENTIVE PLAN 

Section 1. Purpose; Definitions 

        The purpose of the Plan is to give the Company a competitive advantage in attracting, retaining and motivating officers, employees, directors and/or consultants and to provide the Company and its Subsidiaries and Affiliates with a stock plan providing incentives directly linked to the profitability of the Company's businesses and increases in Company shareholder value. 

        For purposes of the Plan, the following terms shall have the respective meanings indicated: 

        (a)   " Affiliate " means a corporation or other entity controlled by, controlling or under common control with the Company. 

        (b)   " Award " means a Stock Option, Restricted Stock, Performance Unit, or other stock-based award granted pursuant to the terms of the Plan. 

        (c)   " Award Agreement " means any written or electronic agreement, contract or other instrument or document evidencing the grant of an Award, which may, but is not required to be, signed by a Participant. 

        (d)   " Award Cycle " means a period of consecutive fiscal years or portions thereof designated by the Plan Administrator over which Performance Units are to be earned. 

        (e)   " Board " means the Board of Directors of the Company 

        (f)    " Cause " means, unless otherwise provided by the Plan Administrator in an Award Agreement, (i) "Cause" as defined in any Individual Agreement to which the Participant is a party, or (ii) if there is no such Individual Agreement or if it does not define Cause: (A) conviction of the Participant for committing a felony under federal law or the law of the state in which such action occurred, (B) fraud or dishonesty against the Company or in the course of fulfilling the Participant's employment duties, (C) willful and deliberate failure on the part of the Participant to perform his or her employment or service-provider duties in any material respect, (D) illegal drug use or alcohol abuse on Company premises or at a Company sponsored event, (E) conduct by the Participant which in the good faith and reasonable determination of the Plan Administrator demonstrates gross unfitness to serve, (F) intentional, material violation by the Participant of any contract between the employee and the Company or of any statutory duty of the Participant to the Company, or (G) prior to a Change in Control, such other events as shall be determined by the Plan Administrator. The Plan Administrator shall, unless otherwise provided in an Individual Agreement with the Participant, have the sole discretion to determine whether "Cause" exists, and its determination shall be final. The foregoing definition shall not in any way preclude or restrict the right of the Company to discharge or dismiss the Participant 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 Cause. 

        (g)   " Change in Control " shall have the meaning set forth in Section 9(b). 

        (h)   " Code " means the Internal Revenue Code of 1986, as amended from time to time, and any successor thereto. 

        (i)    " Commission " means the Securities and Exchange Commission or any successor agency. 

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        (j)    " Common Stock " means common stock, no par value, of the Company. 

        (k)   " Company " means B2 Health, Inc., a Delaware corporation. 

        (l)    " Covered Employee " means a Participant designated prior to the grant of Restricted Stock or Performance Units by the Plan Administrator who is or may be a "covered employee" within the meaning of Section 162(m)(3) of the Code in the year in such Award is expected to be taxable to such Participant. 

        (m)  " Disability " means, unless otherwise provided by the Plan Administrator, (i) "Disability" as defined in any Individual Agreement to which the Participant is a party, or (ii) if there is no such Individual Agreement or it does not define "Disability," (y) if applicable, permanent and total disability as determined under any Long Term Disability Plan maintained by the Company and applicable to the Participant, or otherwise (z) the inability of the Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which is expected to result in death or has lasted or can be expected to last for a continuous period of twelve (12) months or more and shall be determined by the Plan Administrator on the basis of such medical evidence as the Plan Administrator deems warranted under the circumstances. 

        (n)   " Effective Date " shall have the meaning set forth in Section 14. 

        (o)   " Eligible Individual " mean any director, officer, employee and consultant (including advisors) of the Company or any of its Subsidiaries or Affiliates, and prospective employees and consultants who have accepted offers of employment or consultancy from the Company or its Subsidiaries or Affiliates, whom the Plan Administrator determines to be an Eligible Individual. 

        (p)   " Exchange Act " means the Securities Exchange Act of 1934, as amended from time to time, and any successor thereto. 

        (q)   " Fair Market Value " of a share of Common Stock means, except as otherwise provided by the Plan Administrator, as of any given date, the average of the highest and lowest per-share sales prices for a share of Common Stock during normal business hours on the Nasdaq National Market or the Nasdaq SmallCap Market, as appropriate (or such other national securities market or exchange as may at the time be the principal market for the Common Stock) or, in the absence of such markets, as determined in good faith by the Plan Administrator. 

        (r)   " Incentive Stock Option " means any Stock Option designated as, and qualified as, an "incentive stock option" within the meaning of Section 422 of the Code. 

        (s)   " Individual Agreement " means an employment, consulting or similar written agreement between a Participant and the Company or one of its Subsidiaries or Affiliates. 

        (t)    " NonQualified Stock Option " means any Stock Option that is not an Incentive Stock Option. 

        (u)   " Option Price " shall have the meaning set forth in Section 5(d). 

        (v)   " Outside Director " means a director who qualifies as an "independent director" within the meaning of Nasdaq Marketplace Rule 4200(a)(15), as an "outside director" within the meaning of Section 162(m) of the Code, and as a "non-employee director" within the meaning of Rule 16b-3 promulgated under the Exchange Act. 

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        (w)  " Participant " means an Eligible Individual to whom an Award is or has been made in accordance with and pursuant to the Plan or, if applicable, and if permitted in accordance with the terms and provisions of the Plan, such other person who holds outstanding Award. 

        (x)   " Performance Goals " means the performance goals established by the Plan Administrator in connection with the grant of an Award. In the case of Qualified Performance-Based Awards, (i) such goals shall be based on the attainment of specified levels of one or more of the following measures with respect to the Company or such subsidiary, division or department of the Company for or within which the Participant performs services: market share; sales; asset quality; non-performing assets; revenue growth; earnings before interest, taxes, depreciation, and amortization; earnings before interest and taxes; operating income; pre- or after-tax income; earnings per share; cash flow; cash flow per share; return on equity; return on invested capital; return on assets; return on operating assets; economic value added (or an equivalent metric); share price performance; total shareholder return; improvement in or attainment of expense levels or cost savings; or improvement in or attainment of working capital levels and (ii) such Performance Goals shall be set by the Plan Administrator within the time period prescribed by Section 162(m) of the Code and related regulations. Such Performance Goals also may be based upon the attaining of specified levels of Company performance under one or more of the measures described above relative to the performance of other corporations. 

        (y)   " Permitted Transferee " means, in the case of a Participant, (i) such Participant's children or family members, whether directly or indirectly or by means of a trust or partnership or otherwise or (ii) any transferee of all or a portion of such Participant's Award pursuant to a qualified domestic relations order as defined in the Code or Title 1 of the Employee Retirement Income Security Act of 1974, as amended. For purposes of this Plan, unless otherwise determined by the Plan Administrator, " family member " shall have the meaning given to such term in General Instructions A.1(a)(5) to Form S-8 under the Securities Act, or any successor thereto. 

        (z)   " Performance Units " means an Award granted under Section 7. 

        (aa) " Plan " means this B2 Health, Inc., 2006 Equity Incentive Plan, as set forth herein and as hereinafter amended from time to time. 

        (bb) " Plan Administrator " means the Plan Administrator referred to in Section 2(a). 

        (cc) " Qualified Performance-Based Award " means an Award of Restricted Stock or Performance Units designated as such by the Plan Administrator at the time of grant, based upon a determination that (i) the recipient is or may be a "covered employee" within the meaning of Section 162(m)(3) of the Code in the year in which the Company would expect to be able to claim a tax deduction with respect to such Restricted Stock or Performance Units and (ii) the Plan Administrator wishes such Award to qualify for the Section 162(m) Exemption. 

        (dd) " Restricted Stock " means an Award granted under Section 6. 

        (ee) " Retirement " means retirement from active employment with the Company, a Subsidiary or Affiliate at or after age 65. 

        (ff)  " Rule 16b-3 " means Rule 16b-3, as promulgated by the Commission under Section 16(b) of the Exchange Act, as amended from time to time. 

        (gg) " Section 162(m) Exemption " means the exemption from the limitation on deductibility imposed by Section 162(m) of the Code that is set forth in Section 162(m)(4)(C) of the Code. 

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        (hh) " Securities Act " means the Securities Act of 1933, as amended. 

        (ii)   " Stock Option " means an Award granted under Section 5. 

        (jj)   " Subsidiary " means any corporation, partnership, joint venture or other entity during any period in which at least a 50% voting or profits interest is owned, directly or indirectly, by the Company or any successor to the Company. 

        (kk) " Termination of Employment " means the termination of the Participant's employment with, or performance of services for, the Company and any of its Subsidiaries or Affiliates. A change in the capacity in which the Participant renders services to the Company or a Subsidiary or Affiliate as a director, officer, employee or consultant or a change in the entity for which the Participant renders such service, provided that there is no interruption or termination of the Participant's service with the Company or a Subsidiary or Affiliate, shall not constitute a Termination of Employment. For example, a change in status from an employee of the Company to a consultant to a Subsidiary or Affiliate shall not constitute a Termination of Employment. A Participant employed by, or performing services for, a Subsidiary or an Affiliate shall be deemed to incur a Termination of Employment if the Subsidiary or Affiliate ceases to be such a Subsidiary or an Affiliate, as the case may be, and the Participant does not immediately thereafter become an employee of, or service-provider for, the Company or another Subsidiary or Affiliate. The Plan Administrator or the chief executive officer of the Company, in that party's sole discretion, may determine whether a Termination of Employment shall be considered to have occurred (and whether vesting in any outstanding Awards shall continue or be suspended) in the case of any leave of absence approved by that party, including sick leave, military leave or any other personal leave. 

Section 2. Administration 

        (a)   The Plan shall be administered by (i) the Board or (ii) one or more committees of the Board to whom the Board has delegated all or part of its authority under the Plan (the " Plan Administrator "). If administration is delegated to a committee, the committee shall have, in connection with the administration of the Plan, the powers theretofore possessed by the Board, including the power to delegate to a subcommittee any of the administrative powers the committee is authorized to exercise (and references in the Plan to the Plan Administrator shall thereafter be to the subcommittee), subject, however, to such resolutions, not inconsistent with the provisions of the Plan, as may be adopted from time to time by the Board. The Board may abolish any committee at any time and revest in the Board the administration of the Plan. Any committee under clause (ii) hereof which makes grants to "officers" of the Company (as that term is defined in Rule 16a-1(f) promulgated under the Exchange Act) or which makes Awards that are intended to be Qualified Performance-Based Awards shall be composed solely of two or more Outside Directors. For purposes of the preceding provisions, if one or more members of the committee is not an Outside Director, but recuses himself or herself or abstains from voting with respect to a particular action taken by the committee, then the committee, with respect to the action, will be deemed to consist only of the members of the committee who have not recused themselves or abstained from voting. 

        (b)   The Plan Administrator shall have plenary authority to grant Awards pursuant to the terms of the Plan to Participants. 

        (c)   Among other things, the Plan Administrator shall have the authority, subject to the terms of the Plan: 

        (i)    To select the Participants to whom Awards may from time to time be granted; 

        (ii)   To determine whether and to what extent any type of Award is to be granted hereunder; 

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        (iii)  To determine the number of shares of Common Stock to be covered by each Award granted hereunder; 

        (iv)  To determine the terms and conditions of any Award granted hereunder (including, but not limited to, the Option Price (subject to Section 5(a)), any vesting condition, restriction or limitation (which may be related to the performance of the Participant, the Company or any Subsidiary or Affiliate) and any vesting acceleration or forfeiture waiver regarding any Award and the shares of Common Stock relating thereto, based on such factors as the Plan Administrator shall determine); 

        (v)   Subject to the terms of the Plan, including without limitation Section 11, to modify, amend or adjust the terms and conditions of any Award, at any time or from time to time, including but not limited to Performance Goals; provided, however, that the Plan Administrator may not adjust upwards the amount payable to a Covered Employee with respect to a Qualified Performance-Based Award or waive or alter the Performance Goals associated therewith in a manner that would violate Section 162(m) of the Code; 

        (vi)  To determine to what extent and under what circumstances Common Stock and other amounts payable with respect to an Award shall be deferred; 

        (vii) To effect, at any time and from time to time, with the consent of any adversely affected Participant, (1) the reduction of the exercise price of any outstanding Award under the Plan, (2) the cancellation of any outstanding Award under the Plan and the grant in substitution therefor of (A) a new Award under the Plan with a lower Option Price covering the same or a different number of shares of Common Stock, (B) the right to acquire restricted stock, and/or (C) cash, or (3) any other action that is treated as a " repricing " under generally accepted accounting principles; and 

        (viii) To determine under what circumstances an Award may be settled in cash or Common Stock under Section 5(l) and Section 7(b)(iii). 

        (d)   The Plan Administrator shall have the authority to adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan as it shall from time to time deem advisable, to interpret the terms and provisions of the Plan and any Award issued under the Plan (and any agreement relating thereto) and to otherwise supervise the administration of the Plan. The Plan Administrator, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan or in any Award Agreement, in a manner and to the extent it shall deem necessary or expedient to make the Plan fully effective. 

        (e)   The Plan Administrator may act only by a majority of its members then in office. Except to the extent prohibited by applicable law or the applicable rules of a stock exchange on which the Company's shares are traded, the Plan Administrator may (i) allocate all or any portion of its responsibilities and powers to any one or more of its members and (ii) delegate all or any part of its responsibilities and powers to any person or persons selected by it, provided that no such delegation may be made that would cause Awards or other transactions under the Plan to cease to be exempt from Section 16(b) of the Exchange Act or cause an Award designated as a Qualified Performance-Based Award not to qualify for, or to cease to qualify for, the Section 162(m) Exemption. Any such allocation or delegation may be revoked by the Plan Administrator at any time. 

        (f)    Any determination made by the Plan Administrator with respect to any Award shall be made in the sole discretion of the Plan Administrator at the time of the grant of the Award or, unless in contravention of any express term of the Plan, at any time thereafter. All decisions made by the Plan Administrator or any appropriately delegated officer pursuant to the provisions of the Plan shall be final and binding on all persons, including the Company, its Affiliates, Subsidiaries, shareholders and Participants. 

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        (g)   Any authority granted to the Plan Administrator may also be exercised by the full Board, except to the extent that the grant or exercise of such authority would cause any Award or transaction to become subject to (or lose an exemption under) the short-swing profit recovery provisions of Section 16 of the Exchange Act or cause an Award designated as a Qualified Performance-Based Award not to qualify for, or to cease to qualify for, the Section 162(m) Exemption. To the extent that any permitted action taken by the Board conflicts with action taken by the Plan Administrator, the Board action shall control. 

        (h)   To the maximum extent permitted by law, the Company shall indemnify each member of the Board who acts as a member of the Plan Administrator, as well as any other employee of the Company with duties under the Plan, against expenses and liabilities (including any amount paid in settlement) reasonably incurred by the individual in connection with any claims against the individual by reason of the performance of the individual's duties under the Plan, unless the losses are due to the individual's gross negligence or lack of good faith. The Company will have the right to select counsel and to control the prosecution or defense of the suit. In the event that more than one person who is entitled to indemnification is subject to the same claim, all such persons shall be represented by a single counsel, unless such counsel advises the Company in writing that he or she cannot represent all such persons under applicable rules of professional responsibility. The Company will not be required to indemnify any person for any amount incurred through any settlement unless the Company consents in writing to the settlement. 

Section 3. Common Stock Subject to Plan 

        (a)   The maximum number of shares of Common Stock that may be delivered to Participants and their beneficiaries under the Plan shall be 100,000. Shares subject to an Award under the Plan may be authorized and unissued shares or may be treasury shares. The maximum number of shares of Common Stock that may be issued pursuant to Stock Options intended to be Incentive Stock Options shall be 100,000 shares. 

        (b)   For purposes of this Section 3, if an Award entitles the holder thereof to receive or purchase shares, the number of shares of Common Stock covered by such Award or to which such Award relates shall be counted on the date of grant of such Award against the aggregate number of shares available for granting Awards under the Plan. If any Award is forfeited, or if any Stock Option terminates, expires or lapses without being exercised, shares of Common Stock subject to such Awards shall again be available for distribution in connection with Awards under the Plan. If the Option Price of any Stock Option is satisfied by delivering shares of Common Stock to the Company (by either actual delivery or by attestation), only the number of shares of Common Stock delivered to the Participant net of the shares of Common Stock delivered to the Company or attested to shall be deemed delivered for purposes of determining the maximum numbers of shares of Common Stock available for delivery under the Plan. To the extent any shares of Common Stock subject to an Award are not delivered to a Participant because such shares are used to satisfy an applicable tax-withholding obligation, such shares shall not be deemed to have been delivered for purposes of determining the maximum number of shares of Common Stock available for delivery under the Plan. If any shares of Common Stock issued to a Participant pursuant to an Award are forfeited back to or repurchased by the Company because of or in connection with the failure to meet a contingency or condition required to vest such shares in the Participant, the shares of Common Stock forfeited or repurchased under such Award shall revert to and again become available for issuance under the Plan. 

        (c)   In the event of any change in corporate capitalization (including, but not limited to, a change in the number of shares of Common Stock outstanding), such as a stock split or a corporate transaction, such as any merger, consolidation, separation, including a spin-off, or other distribution of stock or property of the Company (including any extraordinary cash or stock dividend), any reorganization (whether or not such reorganization comes within the definition of such term in Section 368 of the Code) or any partial or complete liquidation of the Company, the Plan Administrator or Board may make such substitution or adjustments in the aggregate number and kind of shares reserved for issuance under the Plan, and the maximum limitation upon Stock Options and other Awards to be granted to any Participant, in the number, kind and Option Price of shares subject to outstanding Stock Options, in the number and kind of shares subject to other outstanding Awards granted under the Plan and/or such other equitable substitution or 

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adjustments as it may determine to be appropriate in its sole discretion (including, without limitation, an amount in cash therefor); provided, however, that the number of shares subject to any Award shall always be a whole number. 

        (d)   No fractional shares may be issued under the Plan. Cash shall be paid in lieu of any fractional share in settlement of an Award.

Section 4. Eligibility 

        Awards may be granted under the Plan to Eligible Individuals; provided, however, that a consultant shall not be eligible for the grant of an Award of a Stock Option or Restricted Stock if, at the time of grant, a Form S-8 Registration Statement under the Securities Act (" Form S-8 ") is not available to register either the offer or the sale of the Company's securities to such consultant because of the nature of the services that the consultant is providing to the Company, because the consultant is not a natural person, or because of any other rule governing the use of Form S-8, unless the Plan Administrator determines both (i) that such grant (A) shall be registered in another manner under the Securities Act ( e.g ., on a Form S-3 Registration Statement) or (B) does not require registration under the Securities Act in order to comply with the requirements of the Securities Act, if applicable, and (ii) that such grant complies with the securities laws of all other relevant jurisdictions. 

Section 5. Stock Options 

        (a)   Stock Options may be granted alone or in addition to other Awards granted under the Plan and may be of two types: Incentive Stock Options and NonQualified Stock Options. Any Stock Option granted under the Plan shall be in such form as the Plan Administrator may from time to time approve. 

        (b)   The Plan Administrator shall have the authority to grant any Participant Incentive Stock Options, NonQualified Stock Options or both types of Stock Options; provided, however, that grants hereunder are subject to the limits on grants set forth in Section 3. To the extent that any Stock Option is not designated as an Incentive Stock Option or even if so designated does not qualify as an Incentive Stock Option on or subsequent to its grant date, it shall constitute a NonQualified Stock Option. 

        (c)   Stock Options shall be evidenced by Award Agreements, the terms and provisions of which may differ. An Award Agreement shall indicate on its face whether it is intended to be an agreement for an Incentive Stock Option or a NonQualified Stock Option. The grant of a Stock Option shall occur on the date the Plan Administrator by resolution selects a Participant to receive a grant of a Stock Option, determines the number of shares of Common Stock to be subject to such Stock Option to be granted to such Participant and specifies the terms and provisions of the Stock Option. The Company shall notify a Participant of any grant of a Stock Option, and such Award shall be confirmed by, and subject to the terms of, an Award Agreement. 

        (d)   Stock Options granted under the Plan shall be subject to the following terms and conditions and shall contain such additional terms and conditions as the Plan Administrator shall deem desirable: 

          (i)   Option Price . The Plan Administrator shall determine the option price per share of Common Stock purchasable under a Stock Option (the "Option Price"). The Option Price per share of Common Stock subject to a Stock Option shall not be less than the Fair Market Value of the Common Stock subject to such Stock Option on the date of grant. 

         (ii)   Option Term . The term of each Stock Option shall be fixed by the Plan Administrator, but no Incentive Stock Option shall be exercisable more than 10 years after the date the Stock Option is granted. 

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        (iii)   Exercisability . Except as otherwise provided herein, Stock Options shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Plan Administrator. If the Plan Administrator provides that any Stock Option is subject to vesting conditions, restrictions or limitations and therefore exercisable only in installments, the Plan Administrator may at any time waive such installment exercise provisions, in whole or in part, based on such factors as the Plan Administrator may determine. An Award Agreement may, but need not, include a provision whereby the Participant may elect at any time before the Participant's Termination of Employment to exercise the Stock Option as to any part or all of the shares of Common Stock subject to the Stock Option prior to the full vesting of the Stock Option. Any unvested shares of Common Stock so purchased may be subject to a repurchase option in favor of the Company or to any other restriction the Plan Administrator determines to be appropriate. The Company will not exercise its repurchase option until at least six (6) months (or such longer or shorter period of time required to avoid a charge to earnings for financial accounting purposes) have elapsed following exercise of the Stock Option unless the Plan Administrator otherwise specifically provides in the Stock Option. 

        (iv)   Method of Exercise . Subject to the provisions of this Section 5, Stock Options may be exercised, in whole or in part, at any time during the option term by giving written notice of exercise to the Company specifying the number of shares of Common Stock subject to the Stock Option to be purchased. Such notice shall be accompanied by payment in full of the Option Price by certified or bank check or such other instrument as the Company may accept. If approved by the Plan Administrator, payment, in full or in part, may also be made in the form of unrestricted Common Stock (by delivery of such shares or by attestation) already owned by the Participant of the same class as the Common Stock subject to the Stock Option (based on the Fair Market Value of the Common Stock on the date the Stock Option is exercised); provided, that such already owned shares have been held by the Participant for at least six months (or such longer or shorter period of time required to avoid a charge to earnings for financial accounting purposes) at the time of exercise or had been purchased on the open market; and provided, further, that, in the case of an Incentive Stock Option, the right to make a payment in the form of already owned shares of Common Stock of the same class as the Common Stock subject to the Stock Option may be authorized only at the time the Stock Option is granted. If approved by the Plan Administrator, to the extent permitted by applicable law, payment in full or in part may also be made by delivering a properly executed exercise notice to the Company, together with a copy of irrevocable instructions to a broker to deliver promptly to the Company the amount of sale or loan proceeds necessary to pay the Option Price, and, if requested, the amount of any federal, state, local or foreign withholding taxes. To facilitate the foregoing, the Company may enter into agreements for coordinated procedures with one or more brokerage firms. No shares of Common Stock shall be delivered until full payment therefor has been made. Except as otherwise provided in this Section 5 below, a Participant shall have all of the rights of a shareholder of the Company holding the class or series of Common Stock that is subject to such Stock Option (including, if applicable, the right to vote the shares and the right to receive dividends), when the Participant has given written notice of exercise, has paid in full for such shares and, if requested by the Company, has given the representation described in Section 12(f). 

         (v)   Special Rules Applicable to Incentive Stock Options . Notwithstanding the foregoing, the following terms shall be applicable to all Incentive Stock Options. 

        (a)  Incentive Stock Options may only be granted to employees of the Company and its subsidiaries or parent corporation (within the meaning of Section 424(f) of the Code). 

        (b)  The aggregate Fair Market Value of the shares of Common Stock (determined as of the respective date or dates of grant) for which one or more options granted to any employee under the Plan (or any other option plan of the Company or any subsidiaries or parent corporation) may for the first time become exercisable as Incentive Stock Options during any one (1) calendar year shall not exceed the sum of One Hundred Thousand 

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Dollars ($100,000). To the extent an employee holds two (2) or more such options which become exercisable for the first time in the same calendar year, the foregoing limitation on the exercisability of such options as Incentive Stock Options shall be applied on the basis of the order in which such options are granted. Any Stock Options or portions thereof that exceed such limit shall be treated as NonQualified Stock Options, notwithstanding any other provision of an Award Agreement, but only to the extent of such excess. 

        (c)  If any employee to whom an Incentive Stock Option is granted is the owner of stock (as determined under Code Section 424(d)) possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company (or any subsidiary or parent corporation (within the meaning of Section 424(f) of the Code)), then the option term shall not exceed five (5) years measured from the option grant date and the Option Price shall not be less than one hundred ten percent (110%) of the Fair Market Value of Common Stock on the option grant date. 

        (d)  If an Incentive Stock Option is exercised after the post-termination exercise periods that apply for purposes of Section 422 of the Code, such Stock Option will thereafter be treated as a NonQualified Stock Option. 

        (e)    Nontransferability of Stock Options . No Stock Option shall be transferable by the Participant other than (i) by will or by the laws of descent and distribution or any other testamentary distribution; or (ii) in the case of a NonQualified Stock Option, unless otherwise determined by the Plan Administrator, to a Permitted Transferee. All Stock Options shall be exercisable, subject to the terms of this Plan, only by the Participant, the guardian or legal representative of the Participant, or any person to whom such option is transferred pursuant to this paragraph, it being understood that the term "holder" and "Participant" include such guardian, legal representative and other transferee; provided, however, that Termination of Employment shall continue to refer to the Termination of Employment of the original Participant and provided further that any Award held by transferee shall continue to be subject to the same terms and conditions that were applicable to that Award immediately before the transfer to the transferee. Notwithstanding the foregoing, a Participant may, by delivering written notice to the Company, in a form satisfactory to the Company, designate a third party who, in the event of death of the Participant, shall thereafter be entitled to exercise the Participant's Stock Options. 

        (f)     Termination by Death . Unless otherwise determined by the Plan Administrator at the time of grant, if a Participant incurs a Termination of Employment by reason of death, any Stock Option held by such Participant may thereafter be exercised, to the extent then exercisable, or on such accelerated basis as the Plan Administrator may determine, until the expiration of the stated term of such Stock Option. 

        (g)    Termination by Reason of Disability . Unless otherwise determined by the Plan Administrator at the time of grant or, if a longer period of exercise is desired, thereafter, if a Participant incurs a Termination of Employment by reason of Disability, any Stock Option held by such Participant (or the appointed fiduciary of such Participant) may thereafter be exercised by the Participant (or the appointed fiduciary of such Participant), to the extent it was exercisable at the time of termination, or on such accelerated basis as the Plan Administrator may determine, for a period of one year from the date of such Termination of Employment or until the expiration of the stated term of such Stock Option, whichever period is shorter; provided, however, that if the Participant dies within such period, any unexercised Stock Option held by such Participant shall, notwithstanding the expiration of such period, continue to be exercisable to the extent to 

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which it was exercisable at the time of death until the expiration of the stated term of such Stock Option. 

        (h)    Termination by Reason of Retirement . Unless otherwise determined by the Plan Administrator at the time of grant or, if a longer period of exercise is desired, thereafter, if a Participant incurs a Termination of Employment by reason of Retirement, any Stock Option held by such Participant may thereafter be exercised by the Participant, to the extent it was exercisable at the time of such Retirement, or on such accelerated basis as the Plan Administrator may determine, for a period of one year from the date of such Termination of Employment or until the expiration of the stated term of such Stock Option, whichever period is shorter; provided, however, that if the Participant dies within such period any unexercised Stock Option held by such Participant shall, notwithstanding the expiration of such period, continue to be exercisable to the extent to which it was exercisable at the time of death for until the expiration of the stated term of such Stock Option. 

        (i)     Other Termination . Unless otherwise determined by the Plan Administrator at the time of grant or, if a longer period of exercise is desired, thereafter: (A) if a Participant incurs a Termination of Employment for Cause, all Stock Options held by such Participant shall thereupon terminate; and (B) if a Participant incurs a Termination of Employment for any reason other than death, Disability, Retirement or for Cause, any Stock Option held by such Participant, to extent it was then exercisable at the time of termination, or on such accelerated basis as the Plan Administrator may determine, may be exercised for a period of three months from the date of such Termination of Employment or until the expiration of the stated term of such Stock Option, whichever period is shorter; provided, however, that if the Participant dies within such three-month period, any unexercised Stock Option held by such Participant shall, notwithstanding the expiration of such three-month period, continue to be exercisable to the extent to which it was exercisable at the time of death until the expiration of the stated term of such Stock Option. 

        (j)     Extension of Termination Date . An Award Agreement may also provide that if the exercise of any Stock Option following the termination of the Participant's Termination of Employment (other than upon the Participant's death) would be prohibited at any time solely because the issuance of shares of Common Stock would violate the registration requirements under the Securities Act, then the Stock Option held by such Participant may be exercised, in lieu of the periods specified in Section 5(f) through 5(i), during the three (3) month period after the Participant's Termination of Employment in which the exercise of the Stock Option would not be in violation of such registration requirements or until the expiration of the stated term of such Stock Option, whichever period is shorter. 

        (k)    Change of Control Termination . A Stock Option held by any Participant whose has not suffered a Termination of Employment prior to the effective time of a Change in Control may be subject to additional acceleration of vesting and exercisability upon or after such event as may be provided in the Award Agreement for such Stock Option or as may be provided in any other written agreement between the Company or any Subsidiary or Affiliate and the Participant, but in the absence of such provision, no such acceleration shall occur. 

        (l)     Cashing Out of Stock Option . On receipt of written notice of exercise, the Plan Administrator may elect to cash out all or part of the portion of the shares of Common Stock for which a Stock Option is being exercised by paying the Participant an amount, in cash or Common Stock, equal to the excess of the Fair Market Value of the Common 

10

Stock over the Option Price times the number of shares of Common Stock for which the Option is being exercised on the effective date of such cash-out. 

Section 6. Restricted Stock 

        (a)    Administration . Shares of Restricted Stock may be awarded either alone or in addition to other Awards granted under the Plan. The Plan Administrator shall determine the Participants to whom and the time or times at which grants of Restricted Stock will be awarded, the number of shares to be awarded to any Participant, the conditions for vesting, the time or times within which such Awards may be subject to forfeiture and any other terms and conditions of the Awards, in addition to those contained in Section 6(c). 

        (b)    Awards and Certificates . Shares of Restricted Stock shall be evidenced in such manner as the Plan Administrator may deem appropriate, including book-entry registration or issuance of one or more stock certificates. Any certificate issued in respect of shares of Restricted Stock shall be registered in the name of such Participant and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Award, substantially in the following form: 

"The transferability of this certificate and the shares of stock represented hereby are subject to the terms and conditions (including forfeiture) of the B2 Health, Inc. 2006 Equity Incentive Plan and an Award Agreement. Copies of such Plan and Agreement are on file at the offices of B2 Health, Inc." 

The Plan Administrator may require that the certificates evidencing such shares be held in custody by the Company until the restrictions thereon shall have lapsed and that, as a condition of any Award of Restricted Stock, the Participant shall have delivered a stock power, endorsed in blank, relating to the Common Stock covered by such Award. 

        (c)    Terms and Conditions . Shares of Restricted Stock shall be subject to the following terms and conditions: 

          (i)  The Plan Administrator may, prior to or at the time of grant, designate an Award of Restricted Stock as a Qualified Performance-Based Award, in which event it shall condition the grant or vesting, as applicable, of such Restricted Stock upon the attainment of Performance Goals. If the Plan Administrator does not designate an Award of Restricted Stock as a Qualified Performance-Based Award, it may also condition the grant or vesting thereof upon the attainment of Performance Goals. Regardless of whether an Award of Restricted Stock is a Qualified Performance-Based Award, the Plan Administrator may also condition the grant or vesting thereof upon the continued service of the Participant. The conditions for grant or vesting and the other provisions of Restricted Stock Awards (including without limitation any applicable Performance Goals) need not be the same with respect to each recipient. The Plan Administrator may at any time, in its sole discretion, accelerate or waive, in whole or in part, any of the foregoing restrictions; provided, however, that in the case of Restricted Stock that is a Qualified Performance-Based Award, the applicable Performance Goals have been satisfied. 

         (ii)  Subject to the provisions of the Plan and the Award Agreement referred to in Section 6(c)(vi), during the period, if any, set by the Plan Administrator, commencing with the date of such Award for which such Participant's continued service is required (the " Restriction Period "), and until the later of (A) the expiration of the Restriction Period and (B) the date the applicable Performance Goals (if any) are satisfied, the Participant shall not be permitted to sell, assign, transfer, pledge or otherwise encumber shares of Restricted Stock; provided that, to the extent permitted by applicable law, the foregoing shall not prevent a Participant from pledging Restricted Stock as security for a loan, the sole purpose of which is to provide funds to pay the Option Price for Stock Options. 

11

        (iii)  Except as provided in this paragraph (iii) and Section 6(c)(i) and 7(c)(ii) and the Award Agreement, the Participant shall have, with respect to the shares of Restricted Stock, all of the rights of a shareholder of the Company holding the class or series of Common Stock that is the subject of the Restricted Stock, including, if applicable, the right to vote the shares and the right to receive any cash dividends. If so determined by the Plan Administrator in the applicable Award Agreement and subject to Section 15(h) of the Plan, (A) cash dividends on the class or series of Common Stock that is the subject of the Restricted Stock Award shall be automatically deferred and reinvested in additional Restricted Stock, held subject to the vesting of the underlying Restricted Stock, or held subject to meeting Performance Goals, and (B) dividends payable in Common Stock shall be paid in the form of Restricted Stock of the same class as the Common Stock with which such dividend was paid, held subject to the vesting of the underlying Restricted Stock, or held subject to meeting Performance Goals.

        (iv)  Except to the extent otherwise provided in the applicable Award Agreement or Section 6(c)(i), 7(c)(ii), 7(c)(v) or 11(a), upon a Participant's Termination of Employment for any reason during the Restriction Period or before the applicable Performance Goals are satisfied, all shares still subject to restriction shall be forfeited by the Participant; provided, however, that the Plan Administrator shall have the discretion to waive, in whole or in part, any or all remaining restrictions (other than, in the case of Restricted Stock with respect to which a Participant is a Covered Employee, satisfaction of the applicable Performance Goals unless the Participant's employment is terminated by reason of death or Disability by the Company without Cause) with respect to any or all of such Participant's shares of Restricted Stock. 

         (v)  If and when any applicable Performance Goals are satisfied and the Restriction Period expires without a prior forfeiture of the Restricted Stock, unlegended certificates for such shares shall be delivered to the Participant upon surrender of the legended certificates. 

        (vi)  Each Award shall be confirmed by, and be subject to, the terms of an Award Agreement. 

Section 7. Performance Units 

        (a)    Administration . Performance Units may be awarded either alone or in addition to other Awards granted under the Plan. The Plan Administrator shall determine the Participants to whom and the time or times at which Performance Units shall be awarded, the number of Performance Units to be awarded to any Participant), the duration of the Award Cycle and any other terms and conditions of the Award, in addition to those contained in Section 7(b). 

        (b)    Terms and Conditions . Performance Units Awards shall be subject to the following terms and conditions: 

          (i)  The Plan Administrator may, prior to or at the time of the grant, designate Performance Units as Qualified Performance-Based Awards, in which event it shall condition the settlement thereof upon the attainment of Performance Goals. If the Plan Administrator does not designate Performance Units as Qualified Performance-Based Awards, it may also condition the settlement thereof upon the attainment of Performance Goals. Regardless of whether Performance Units are Qualified Performance-Based Awards, the Plan Administrator may also condition the settlement thereof upon the continued service of the Participant. The provisions of such Awards (including without limitation any applicable Performance Goals) need not be the same with respect to each recipient. Subject to the provisions of the Plan and the Award Agreement referred to in Section 7(b)(iv), Performance Units may not be sold, assigned, transferred, pledged or otherwise encumbered during the Award Cycle. No more than 25,000 shares of Common Stock may be subject to Qualified Performance Based Awards granted to any Eligible Individual in any fiscal year of the Company. 

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         (ii)  Except to the extent otherwise provided in the applicable Award Agreement or Section 7(b)(ii) or Section 9(a), upon a Participant's Termination of Employment for any reason during the Award Cycle or before any applicable Performance Goals are satisfied, all rights to receive cash or stock in settlement of the Performance Units shall be forfeited by the Participant; provided, however, that the Plan Administrator shall have the discretion to waive, in whole or in part, any or all remaining payment limitations (other than, in the case of Performance Units that are Qualified Performance-Based Awards, satisfaction of the applicable Performance Goals unless the Participant's employment is terminated by reason of death or Disability by the Company without Cause) with respect to any or all of such Participant's Performance Units. 

        (iii)  At the expiration of the Award Cycle, the Plan Administrator shall evaluate the Company's performance in light of any Performance Goals for such Award, and shall determine the number of Performance Units granted to the Participant which have been earned, and the Plan Administrator shall then cause to be delivered (A) a number of shares of Common Stock equal to the number of Performance Units determined by the Plan Administrator to have been earned, or (B) cash equal to the Fair Market Value of such number of shares of Common Stock to the Participant, as the Plan Administrator shall elect. 

        (iv)  Each Award shall be confirmed by, and be subject to, the terms of an Award Agreement. 

Section 8. Other Stock-Based Awards 

        Other Awards of Common Stock and other Awards that are valued in whole or in part by reference to, or are otherwise based upon, Common Stock, including (without limitation) dividend equivalents and convertible debentures, may be granted either alone or in conjunction with other Awards granted under the Plan. 

Section 9. Change in Control Provisions 

        (a)    Impact of Event . Notwithstanding any other provision of the Plan to the contrary, unless otherwise provided by the Plan Administrator in any Award Agreement, in the event of a Change in Control: 

          (i)  Any Stock Options outstanding as of the date of such Change in Control, and which are not then exercisable and vested, shall become fully exercisable and vested. 

         (ii)  The restrictions applicable to any Restricted Stock shall lapse, and such Restricted Stock shall become free of all restrictions and become fully vested. 

        (iii)  All Performance Awards shall be considered to be earned and payable in full, and any restriction shall lapse and such Performance Awards shall be settled in cash or Shares, as determined by the Plan Administrator, as promptly as is practicable. 

        (iv)  All restrictions on other Awards shall lapse and such Awards shall become free of all restrictions and become fully vested. 

        (b)    Definition of Change in Control . For purposes of the Plan, a " Change in Control " shall mean the happening of any of the following events: 

          (i)  An acquisition by any individual, entity or "group" (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a " Person ") of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 33 1 / 3 % or more of either (1) the then outstanding shares of common stock of the Company (the " Outstanding Company 

13

Common Stock ") or (2) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the " Outstanding Company Voting Securities "); excluding, however, the following: (1) any acquisition directly from the Company, other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Company, (2) any acquisition by the Company, (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any entity controlled by the Company, (4) any acquisition pursuant to a transaction which complies with clauses (1), (2) and (3) of subsection (iii) of this Section 9(b), or (5) any Change in Control triggered solely because the percentage of Outstanding Company Common Stock or Outstanding Company Voting Securities held by any Person (the " Subject Person ") exceeds the designated percentage threshold thereof as a result of a repurchase or other acquisition of securities by the Company reducing the number of shares outstanding, provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of securities by the Company, and after such share acquisition, the Subject Person becomes the owner of any additional voting securities that, assuming the repurchase or other acquisition had not occurred, increases the percentage of the then outstanding voting securities owned by the Subject Person over the designated percentage threshold, then a Change in Control shall be deemed to occur; or 

         (ii)  A change in the composition of the Board such that the individuals who, as of the Effective Date, constitute the Board (such Board shall be hereinafter referred to as the " Incumbent Board ") cease for any reason to constitute at least a majority of the Board; provided, however, for purposes of this Section 9(b)(ii), that any individual who becomes a member of the Board subsequent to the Effective Date, whose election, or nomination for election by the Company's shareholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso) shall be considered as though such individual were a member of the Incumbent Board; but, provided, further, that any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board; or 

        (iii)  Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (" Corporate Transaction "); excluding, however, such a Corporate Transaction pursuant to which (1) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, more than 50% of, respectively, the outstanding shares of common stock, and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Corporate Transaction (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (2) no Person (other than the Company, any employee benefit plan (or related trust) of the Company or such corporation resulting from such Corporate Transaction) will beneficially own, directly or indirectly, 33 1 / 3 % or more of, respectively, the outstanding shares of common stock of the corporation resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of such corporation entitled to vote generally in the election of directors except to the extent that such ownership existed prior to the Corporate Transaction, and (3) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; or 

14

        (iv)  The approval by the shareholders of the Company of a complete liquidation or dissolution of the Company, or a complete dissolution or liquidation of the Company shall otherwise occur. 

        The term Change in Control shall not include a sale of assets, merger or other transaction effected exclusively for the purpose of changing the domicile of the Company. 

        Notwithstanding the foregoing or any other provision of the Plan, the definition of Change in Control (or any analogous term) in an Award Agreement between the Company or any Subsidiary and the Participant shall supersede the foregoing definition with respect to Awards subject to such agreement (it being understood, however, that if no definition of Change in Control or any analogous term is set forth in such an Award Agreement, the foregoing definition shall apply).

Section 10. Forfeiture of Awards 

        Notwithstanding anything in the Plan to the contrary, the Plan Administrator shall have the authority under the Plan to provide in any Award Agreement that in the event of serious misconduct by a Participant (including, without limitation, any misconduct prejudicial to or in conflict with the Company or its Subsidiaries or Affiliates, or any Termination of Employment for Cause), or any activity of a Participant in competition with the business of the Company or any Subsidiary or Affiliate, any outstanding Award granted to such Participant shall be cancelled, in whole or in part, whether or not vested or deferred. The determination of whether a Participant has engaged in a serious breach of conduct or any activity in competition with the business of the Company or any Subsidiary or Affiliate shall be determined by the Plan Administrator in good faith and in its sole discretion. 

Section 11. Term, Amendment and Termination 

        The Plan will terminate on the tenth anniversary of the Effective Date. Under the Plan, Awards outstanding as of such date shall not be affected or impaired by the termination of the Plan. 

        The Board may amend, alter, or discontinue the Plan, but no amendment, alteration or discontinuation shall be made which would impair the rights of a Participant under a Stock Option, Restricted Stock Award, Performance Unit Award or other Award theretofore granted without the Participant's or recipient's consent, except such an amendment made to comply with applicable law, stock exchange rules or accounting rules. In addition, no such amendment shall be made without the approval of the Company's shareholders to the extent such approval is required by applicable law or stock exchange rules. 

        The Plan Administrator may amend the terms of any Stock Option or other Award theretofore granted, prospectively or retroactively, but no such amendment shall cause a Qualified Performance-Based Award to cease to qualify for the Section 162(m) Exemption or impair the rights of any holder without the holder's consent except such an amendment made to cause the Plan or Award to comply with applicable law, stock exchange rules or accounting rules. 

        Subject to the above provisions, the Board shall have authority to amend the Plan to take into account changes in law and tax and accounting rules as well as other developments, and to grant Awards which qualify for beneficial treatment under such rules without shareholder approval. 

15

Section 12. Unfunded Status of Plan 

        It is presently intended that the Plan constitute an "unfunded" plan for incentive and deferred compensation. The Plan Administrator may authorize the creation of trusts or other arrangements to meet the obligations created under the Plan to deliver Common Stock or make payments; provided, however, that unless the Plan Administrator otherwise determines, the existence of such trusts or other arrangements is consistent with the "unfunded" status of the Plan. 

Section 13. General Provisions 

        (a)    Availability of Shares . During the terms of any Awards under the Plan, the Company shall keep available at all times the number of shares of Common Stock required to satisfy such Awards. 

        (b)    Securities Law Compliance . The Company shall seek to obtain from each regulatory commission or agency having jurisdiction over the Plan such authority as may be required to grant Awards and to issue and sell shares of Common Stock upon exercise of the Awards; provided, however, that this undertaking shall not require the Company to register under the Securities Act the Plan, any Award or any Common Stock issued or issuable pursuant to any such Award. Notwithstanding any other provision of the Plan or agreements made pursuant thereto, the Company shall not be required to issue or deliver any certificate or certificates for shares of Common Stock under the Plan prior to fulfillment of all of the following conditions: 

          (i)  Listing or approval for listing upon notice of issuance, of such shares on NASDAQ, or such other securities exchange as may at the time be the principal market for the Common Stock; 

         (ii)  Any registration or other qualification of such shares of the Company under any state or federal law or regulation, or the maintaining in effect of any such registration or other qualification which the Plan Administrator shall, in its absolute discretion upon the advice of counsel, deem necessary or advisable; and 

        (iii)  Obtaining any other consent, approval, or permit from any state or federal governmental agency which the Plan Administrator shall, in its absolute discretion after receiving the advice of counsel, determine to be necessary or advisable. 

        (c)    Investment Assurances . The Company may require a Participant, as a condition of acquiring Common Stock under any Award, (i) to give written assurances satisfactory to the Company as to the Participant's knowledge and experience in financial and business matters and/or to employ a purchaser representative reasonably satisfactory to the Company who is knowledgeable and experienced in financial and business matters and that he or she is capable of evaluating, alone or together with the purchaser representative, the merits and risks of exercising the Award; and (ii) to give written assurances satisfactory to the Company stating that the Participant is acquiring Common Stock subject to the Award for the Participant's own account and not with any present intention of selling or otherwise distributing the Common Stock. The foregoing requirements, and any assurances given pursuant to such requirements, shall be inoperative if (1) the issuance of the shares of Common Stock upon the exercise or acquisition of Common Stock under the Award has been registered under a then currently effective registration statement under the Securities Act or (2) as to any particular requirement, a determination is made by counsel for the Company that such requirement need not be met in the circumstances under the then applicable securities laws. The Company may, upon advice of counsel to the Company, place legends on stock certificates issued under the Plan as such counsel deems necessary or appropriate in order to comply with applicable securities laws, including, but not limited to, legends restricting the transfer of the Common Stock. 

        (d)    Section 16 Compliance; Section 162(m) Administration . The Plan is intended to comply in all respects with Rule 16b-3 or any successor provision, as in effect from time to time, and in all events the Plan shall be construed in accordance with the requirements of Rule 16b-3. If any Plan provision does not 

16

comply with Rule 16b-3 as hereafter amended or interpreted, the provision shall be deemed inoperative. The Board, in its absolute discretion, may bifurcate the Plan so as to restrict, limit or condition the use of any provision of the Plan with respect to persons who are officers or directors subject to Section 16 of the Exchange Act without so restricting, limiting or conditioning the Plan with respect to other Eligible Individuals. The Company intends that all Stock Options granted under the Plan to individuals who are or who the Plan Administrator believes will be Covered Employees will constitute "qualified performance-based compensation" within the meaning of Section 162(m) of the Code. 

        (e)    No Limit of Other Arrangements . Nothing contained in the Plan shall prevent the Company or any Subsidiary or Affiliate from adopting other or additional compensation arrangements for its employees. 

        (f)     No Contract of Employment . The Plan shall not constitute a contract of employment, and adoption of the Plan shall not confer upon any employee any right to continued employment, nor shall it interfere in any way with the right of the Company or any Subsidiary or Affiliate to terminate the employment of any employee at any time.

        (g)    Tax Withholding . No later than the date as of which an amount first becomes includible in the gross income of the Participant for federal income tax purposes with respect to any Award under the Plan, the Participant shall pay to the Company, or make arrangements satisfactory to the Company regarding the payment of, any federal, state, local or foreign taxes of any kind required by law to be withheld with respect to such amount. Unless otherwise determined by the Company, withholding obligations may be settled with Common Stock, including Common Stock that is part of the Award that gives rise to the withholding requirement; provided, that not more than the legally required minimum withholding may be settled with Common Stock. The obligations of the Company under the Plan shall be conditional on such payment or arrangements, and the Company and its Affiliates shall, to the extent permitted by law, have the right to deduct any such taxes from any payment otherwise due to the Participant. The Plan Administrator may establish such procedures as it deems appropriate, including making irrevocable elections, for the settlement of withholding obligations with Common Stock. 

        (h)    Dividends . Reinvestment of dividends in additional Restricted Stock at the time of any dividend payment shall only be permissible if sufficient shares of Common Stock are available under Section 3 for such reinvestment (taking into account then outstanding Stock Options and other Awards). 

        (i)     Death Beneficiary . The Plan Administrator shall establish such procedures as it deems appropriate for a Participant to designate a beneficiary to whom any amounts payable in the event of the Participant's death are to be paid or by whom any rights of the Participant, after the Participant's death, may be exercised. 

        (j)     Subsidiary Employees . In the case of a grant of an Award to any employee of a Subsidiary of the Company, the Company may, if the Plan Administrator so directs, issue or transfer the shares of Common Stock, if any, covered by the Award to the Subsidiary, for such lawful consideration as the Plan Administrator may specify, upon the condition or understanding that the Subsidiary will transfer the shares of Common Stock to the employee in accordance with the terms of the Award specified by the Plan Administrator pursuant to the provisions of the Plan. All shares of Common Stock underlying Awards that are forfeited or canceled should revert to the Company. 

        (k)    Use of Proceeds From Stock . Proceeds from the sale of Common Stock pursuant to Awards shall constitute general funds of the Company. 

        (l)     Governing Law . The Plan and all Awards made and actions taken thereunder shall be governed by and construed in accordance with the laws of the State of Delaware, without reference to principles of conflict of laws. 

17

        (m)   Nontransferability . Except as otherwise provided hereunder or by the Plan Administrator, Awards under the Plan are not transferable except by will or by laws of descent and distribution. 

        (n)    Application to Participants Outside of the United States . In the event an Award is granted to Participant who is employed or providing services outside the United States and who is not compensated from a payroll maintained in the United States, the Plan Administrator may, in its sole discretion, modify the provisions of the Plan as they pertain to such individual to comply with applicable foreign law. 

Section 14. Effective Date of Plan 

        The Plan shall be effective as of the date that it is approved by the shareholders of the Company (the " Effective Date "). 

18

 

Exhibit 10.3 

NOTICE OF GRANT OF STOCK OPTION 

        Notice is hereby given of the following option grant (the "Option") to purchase shares of the Common Stock of B2 Health, Inc., a Delaware corporation (the "Company"): 

				
	  

	Optionee: 

	  

	____________________________________________________

				
	  

	Grant Date: 

	  

	____________________________________________

				
	  

	Vesting Commencement Date: 

	  

	_______________________

				
	  

	Exercise Price: 

	  

	$                                      per share 

				
	  

	Number of Option Shares: 

	  

	$                          shares of Common Stock 

				
	  

	Expiration Date: 

	  

	_____________________

						
	  

	Type of Option: 

	  

	_______ 

	  

	Incentive Stock Option 

	

  

	

  

	_______

	  

	Non-Statutory Stock Option 

			
	Date Exercisable: 

	  

	Immediately Exercisable 

	

Vesting Schedule: 

	

  

	

________________________________________________________________

	_______________________________________________________________________

        For purposes of the Option, the term "Service" shall mean the provision of services to the Company (or any Subsidiary or Affiliate) by a person in the capacity of an employee, a non-employee member of the board of directors or a consultant or independent advisor, except to the extent otherwise specifically provided in the Option Agreement. 

        Optionee understands and agrees that the Option is granted subject to and in accordance with the terms of the 2006 Equity Incentive Plan (the "Plan"). Optionee further agrees to be bound by the terms of the Plan and the terms of the Option as set forth in the Stock Option Agreement attached hereto as Exhibit A (the "Option Agreement"). 

        Optionee understands that any Option Shares purchased under the Option will be subject to the terms set forth in the Stock Purchase Agreement attached hereto as Exhibit B (the "Purchase Agreement"). Optionee hereby acknowledges receipt of a copy of the Plan in the form attached hereto as Exhibit C . 

         REPURCHASE RIGHTS . OPTIONEE HEREBY AGREES THAT ALL OPTION SHARES ACQUIRED UPON THE EXERCISE OF THE OPTION SHALL BE SUBJECT TO CERTAIN REPURCHASE RIGHTS AND RIGHTS OF FIRST REFUSAL EXERCISABLE BY THE 

19

COMPANY AND ITS ASSIGNS. THE TERMS OF SUCH RIGHTS ARE SPECIFIED IN THE ATTACHED STOCK PURCHASE AGREEMENT. 

        At Will Employment.     Nothing in this Notice or in the attached Stock Option Agreement or Plan shall confer upon Optionee any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining Optionee) or of Optionee, which rights are hereby expressly reserved by each, to terminate Optionee's Service at any time for any reason, with or without cause. 

        Definitions.     All capitalized terms in this Notice shall have the meaning assigned to them in this Notice or in the attached Stock Option Agreement. 

DATED:                          , 2006.

					
	

  

	

  

	

COMPANY: 

	

  

	 	B2 Health, Inc.

	

  

	

  

	

By: 

	

  

	

___________________________________

	

  

	

  

	

Title: 

	

  

	

___________________________________

					
	

  

	

  

	

OPTIONEE: 

	

  

	

  

	

Signature: 

	

  

	

________________________________

					
	

  

	

  

	

Printed Name: 

	

  

	

___________________________

					
	

  

	

  

	

Address: 

	

  

	

_________________________________

	

  

	

  

	

  

	

  

	____________________________

Attachments : Exhibit A—Stock Option Agreement , Exhibit B—Stock Purchase Agreement 

Exhibit C—2006 Equity Incentive Plan 

20

EXHIBIT A 

STOCK OPTION AGREEMENT 

Filed as Exhibit 10.6 

EXHIBIT B 

STOCK PURCHASE AGREEMENT 

Filed as Exhibit 10.5 

EXHIBIT C 

2006 EQUITY INCENTIVE PLAN 

Filed as Exhibit 10.2 

21

Exhibit 10.4 

NON-EXEMPT EMPLOYEE 

UNDER FAIR LABOR STANDARDS ACT 

B2 HEALTH, INC.

NOTICE OF GRANT OF STOCK OPTION 

        Notice is hereby given of the following option grant (the "Option") to purchase shares of the Common Stock of B2 Health, Inc., a Delaware corporation (the "Company"): 

				
	  

	Optionee: 

	  

	______________________________________________

				
	  

	Grant Date: 

	  

	_________________________

				
	  

	Vesting Commencement Date: 

	  

	____________________

				
	  

	Exercise Price: 

	  

	$                                      per share 

				
	  

	Number of Option Shares: 

	  

	$                          shares of Common Stock 

				
	  

	Expiration Date: 

	  

	________________

						
	  

	Type of Option: 

	  

	______

	  

	Incentive Stock Option 

	

  

	

  

	

_______

	

  

	

Non-Statutory Stock Option 

        Date Exercisable:     The Option shall become exercisable for all the Option Shares upon the Optionee's completion of six (6) months of Service measured from the Grant Date. 

			
	

Vesting Schedule: 

	

  

	

______________________________________________________________

	

___________________________________________________________________________________

        For purposes of the Option, the term "Service" shall mean the provision of services to the Company (or any Subsidiary or Affiliate) by a person in the capacity of an employee, a non-employee member of the board of directors or a consultant or independent advisor, except to the extent otherwise specifically provided in the Option Agreement. 

        Optionee understands and agrees that the Option is granted subject to and in accordance with the terms of the 2006 Equity Incentive Plan (the "Plan"). Optionee further agrees to be bound by the terms of the Plan 

22

and the terms of the Option as set forth in the Stock Option Agreement attached hereto as Exhibit A (the "Option Agreement"). 

        Optionee understands that any Option Shares purchased under the Option will be subject to the terms set forth in the Stock Purchase Agreement attached hereto as Exhibit B (the "Purchase Agreement"). Optionee hereby acknowledges receipt of a copy of the Plan in the form attached hereto as Exhibit C . 

         REPURCHASE RIGHTS . OPTIONEE HEREBY AGREES THAT ALL OPTION SHARES ACQUIRED UPON THE EXERCISE OF THE OPTION SHALL BE SUBJECT TO CERTAIN REPURCHASE RIGHTS AND RIGHTS OF FIRST REFUSAL EXERCISABLE BY THE COMPANY AND ITS ASSIGNS. THE TERMS OF SUCH RIGHTS ARE SPECIFIED IN THE ATTACHED STOCK PURCHASE AGREEMENT. 

        At Will Employment.     Nothing in this Notice or in the attached Stock Option Agreement or Plan shall confer upon Optionee any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining Optionee) or of Optionee, which rights are hereby expressly reserved by each, to terminate Optionee's Service at any time for any reason, with or without cause. 

        Definitions.     All capitalized terms in this Notice shall have the meaning assigned to them in this Notice or in the attached Stock Option Agreement. 

DATED:                          , 20      

					
	

  

	

  

	

COMPANY: 

	

  

	

  

	B2 HEALTH, INC.

	

  

	

  

	

By: 

	

  

	

______________________________

	

  

	

  

	

Title: 

	

  

	

______________________________

								
	

  

	

  

	

OPTIONEE: 

	

  

	

  

	

Signature: 

	

  

	

___________________________

	

  

	

  

	

Printed Name: 

	

  

	

___________________________

	

  

	

  

	

Address: 

	

  

	

_________________________________

23

EXHIBIT A 

STOCK OPTION AGREEMENT 

Filed as Exhibit 10.6 

EXHIBIT B 

STOCK PURCHASE AGREEMENT 

Filed as Exhibit 10.5 

EXHIBIT C 

2006 EQUITY INCENTIVE PLAN 

Filed as Exhibit 10.2 

24

Exhibit 10.5 

B2 HEALTH, INC. 

STOCK PURCHASE AGREEMENT 

        This Stock Purchase Agreement (the "Agreement") is made and entered into this  ______ day of ________________, 2006, by and between B2 Health, Inc., a Delaware corporation (the "Company"), and              ("Optionee"). 

RECITALS 

        A.    The Board has adopted the 2006 Equity Incentive Plan (the "Plan") pursuant to which Optionee has been granted an option to acquire shares of Common Stock as specified in a Notice of Grant of Stock Option (the "Grant Notice"). 

        B.    Optionee desires to exercise his or her option to purchase some or all of the option shares (as specified in the Grant Notice). 

        C.    Capitalized terms used but not otherwise defined in this Agreement have the respective meanings specified in the Plan and the Grant Notice. 

ARTICLE I 

EXERCISE OF OPTION 

        Section 1.1     Exercise.     Optionee hereby purchases  _________ shares of Common Stock (the "Purchased Shares") pursuant to that certain option (the "Option") granted Optionee on ________________, 2006 (the "Grant Date") to purchase up to  ______________ shares of Common Stock (the "Option Shares") under the Plan at the exercise price of $ _________ per share (the "Exercise Price"). 

        Section 1.2     Payment.     Concurrently with the delivery of this Agreement to the Company, Optionee shall pay the Exercise Price for the Purchased Shares in accordance with the provisions of the Stock Option Agreement attached as Exhibit A to the Grant Notice (the "Option Agreement") and shall deliver whatever additional documents may be required by the Option Agreement as a condition for exercise, together with a duly-executed blank Assignment Separate from Certificate (in the form attached hereto as Exhibit I ) with respect to the Purchased Shares. 

        Section 1.3     Stockholder Rights.     Until such time as the Company exercises the Repurchase Right or the First Refusal Right, Optionee (or any successor in interest) shall have all the rights of a stockholder (including voting, dividend and liquidation rights) with respect to the Purchased Shares, subject, however, to the transfer restrictions of Articles II and III. 

ARTICLE II 

SECURITIES LAW COMPLIANCE 

        Section 2.1     Restricted Securities.     The Purchased Shares have not been registered under the 1933 Act and are being issued to Optionee in reliance upon the exemption from such registration provided by SEC Rule 701 for stock issuances under compensatory benefit plans such as the Plan. Optionee hereby confirms that Optionee has been informed that the Purchased Shares are restricted securities under the 1933 Act and may not be resold or transferred unless the Purchased Shares are first registered under the Federal securities laws or unless an exemption from such registration is available. Accordingly, Optionee hereby acknowledges that Optionee is acquiring the Purchased Shares for investment purposes only and not with a 

25

view to resale and is prepared to hold the Purchased Shares for an indefinite period and that Optionee is aware that SEC Rule 144 issued under the 1933 Act which exempts certain resales of unrestricted securities is not presently available to exempt the resale of the Purchased Shares from the registration requirements of the 1933 Act. 

        Section 2.2     Restrictions on Disposition of Purchased Shares.     Optionee shall make no disposition of the Purchased Shares (other than a Permitted Transfer) unless and until there is compliance with all of the following requirements: 

        (a)   Optionee shall have provided the Company with a written summary of the terms and conditions of the proposed disposition. 

        (b)   Optionee shall have complied with all requirements of this Agreement applicable to the disposition of the Purchased Shares. 

        (c)   Optionee shall have provided the Company with written assurances, in form and substance satisfactory to the Company, that (a) the proposed disposition does not require registration of the Purchased Shares under the 1933 Act or (b) all appropriate action necessary for compliance with the registration requirements of the 1933 Act or any exemption from registration available under the 1933 Act (including Rule 144) has been taken. 

        The Company shall not be required (i) to transfer on its books any Purchased Shares which have been sold or transferred in violation of the provisions of this Agreement or (ii) to treat as the owner of the Purchased Shares, or otherwise to accord voting, dividend or liquidation rights to, any transferee to whom the Purchased Shares have been transferred in contravention of this Agreement. 

        For purposes of this Agreement "Permitted Transfer" shall mean (i) a gratuitous transfer of the Purchased Shares, provided and only if Optionee obtains the Company's prior written consent to such transfer, (ii) a transfer of title to the Purchased Shares effected pursuant to Optionee's will or the laws of inheritance following Optionee's death or (iii) a transfer to the Company in pledge as security for any purchase-money indebtedness incurred by Optionee in connection with the acquisition of the Purchased Shares. 

        Section 2.3     Restrictive Legends.     The stock certificates for the Purchased Shares shall be endorsed with one or more of the following restrictive legends: 

        "The shares represented by this certificate have not been registered under the Securities Act of 1933. The shares may not be sold or offered for sale in the absence of (a) an effective registration statement for the shares under such Act, (b) a "no action" letter of the Securities and Exchange Commission with respect to such sale or offer or (c) satisfactory assurances to the Company that registration under such Act is not required with respect to such sale or offer." 

        "The shares represented by this certificate are subject to certain repurchase rights and rights of first refusal granted to the Company and accordingly may not be sold, assigned, transferred, encumbered, or in any manner disposed of except in conformity with the terms of a written agreement dated  _____________, 2006 between the Company and the registered holder of the shares (or the predecessor in interest to the shares). A copy of such agreement is maintained at the Company's principal corporate offices." 

26

ARTICLE III 

TRANSFER RESTRICTIONS 

        Section 3.1     Restriction on Transfer.     Except for any Permitted Transfer, Optionee shall not transfer, assign, encumber or otherwise dispose of any of the Purchased Shares which are subject to the Repurchase Right (as defined below). In addition, Purchased Shares which are released from the Repurchase Right shall not be transferred, assigned, encumbered or otherwise disposed of in contravention of the First Refusal Right (as defined below) or the Market Stand-Off (as defined below). 

        Section 3.2     Transferee Obligations.     Each person (other than the Company) to whom the Purchased Shares are transferred by means of a Permitted Transfer must, as a condition precedent to the validity of such transfer, acknowledge in writing to the Company that such person is bound by the provisions of this Agreement and that the transferred shares are subject to (i) the Repurchase Right, (ii) the First Refusal Right and (iii) the Market Stand-Off, to the same extent such shares would be so subject if retained by Optionee. 

        Section 3.3     Market Stand-Off.      

        (a)   In connection with any underwritten public offering by the Company of its equity securities pursuant to an effective registration statement filed under the 1933 Act, including the Company's initial public offering, Optionee and all subsequent holders of the Purchased Shares who derive their chain of ownership through a Permitted Transfer from Optionee (collectively, "Owner") shall not sell, make any short sale of, loan, hypothecate, pledge, grant any option for the purchase of, or otherwise dispose or transfer for value or otherwise agree to engage in any of the foregoing transactions with respect to, any Purchased Shares without the prior written consent of the Company or its underwriters. Such restriction (the "Market Stand-Off") shall be in effect for such period of time from and after the effective date of the final prospectus for the offering as may be requested by the Company or such underwriters. In no event, however, shall such period exceed one hundred eighty (180) days, and the Market Stand-Off shall in no event be applicable to any underwritten public offering effected more than two (2) years after the effective date of the Company's initial public offering. 

        (b)   Owner shall be subject to the Market Stand-Off provided and only if the officers and directors of the Company are also subject to similar restrictions. 

        (c)   Any new, substituted or additional securities which are by reason of any Recapitalization or Reorganization distributed with respect to the Purchased Shares shall be immediately subject to the Market Stand-Off, to the same extent the Purchased Shares are at such time covered by such provisions. 

        (d)   In order to enforce the Market Stand-Off, the Company may impose stop-transfer instructions with respect to the Purchased Shares until the end of the applicable stand-off period. 

ARTICLE IV 

REPURCHASE RIGHT 

        Section 4.1     Grant.     The Company is hereby granted the right (the "Repurchase Right"), exercisable at any time during the sixty (60)-day period following the date Optionee ceases for any reason to remain in Service or (if later) during the sixty (60)-day period following the execution date of this Agreement, to repurchase at the lower of (i) the per share Exercise Price or (ii) the Fair Market Value per share of Common Stock on the date of Optionee's cessation of Service (the amount determined pursuant to clause (i) or (ii), as applicable, being referred to herein as the "Repurchase Price") any or all of the Purchased Shares in which Optionee is not, at the time of his or her cessation of Service, vested in accordance with the vesting schedule specified in the Grant Notice (the "Vesting Schedule") applicable to 

27

those shares or the special vesting acceleration provisions of Section 4.6 of this Agreement (such shares to be hereinafter referred to as the "Unvested Shares"). 

        Section 4.2     Exercise of the Repurchase Right.     The Repurchase Right shall be exercisable by written notice delivered to each Owner of the Unvested Shares prior to the expiration of the sixty (60)-day exercise period. The notice shall indicate the number of Unvested Shares to be repurchased, the Repurchase Price to be paid per share and the date on which the repurchase is to be effected, such date to be not more than thirty (30) days after the date of such notice. The certificates representing the Unvested Shares to be repurchased shall be delivered to the Company on the closing date specified for the repurchase. Concurrently with the receipt of such stock certificates, the Company shall pay to Owner, in cash or cash equivalents (including the cancellation of any purchase-money indebtedness), an amount equal to the Repurchase Price for the Unvested Shares which are to be repurchased from Owner. 

        Section 4.3     Termination of the Repurchase Right.     The Repurchase Right shall terminate with respect to any Unvested Shares for which it is not timely exercised under Section 4.2. In addition, the Repurchase Right shall terminate and cease to be exercisable with respect to any and all Purchased Shares in which Optionee vests in accordance with the Vesting Schedule. All Purchased Shares as to which the Repurchase Right lapses shall, however, remain subject to (i) the First Refusal Right and (ii) the Market Stand-Off. 

        Section 4.4     Aggregate Vesting Limitation.     If the Option is exercised in more than one increment so that Optionee is a party to one or more other Stock Purchase Agreements (the "Prior Purchase Agreements") which are executed prior to the date of this Agreement, then the total number of Purchased Shares as to which Optionee shall be deemed to have a fully-vested interest under this Agreement and all Prior Purchase Agreements shall not exceed in the aggregate the number of Purchased Shares in which Optionee would otherwise at the time be vested, in accordance with the Vesting Schedule, had all the Purchased Shares (including those acquired under the Prior Purchase Agreements) been acquired exclusively under this Agreement. 

        Section 4.5     Recapitalization.     Any new, substituted or additional securities or other property (including cash paid other than as a regular cash dividend) which is by reason of any Recapitalization distributed with respect to the Purchased Shares shall be immediately subject to the Repurchase Right and any escrow requirements hereunder, but only to the extent the Purchased Shares are at the time covered by such right or escrow requirements. Appropriate adjustments to reflect such distribution shall be made to the number and/or class of Purchased Shares subject to this Agreement and to the Repurchase Price per share to be paid upon the exercise of the Repurchase Right in order to reflect the effect of any such Recapitalization upon the Company's capital structure; provided, however, that the aggregate Repurchase Price shall remain the same. 

        Section 4.6     Change in Control.     The Repurchase Right shall automatically terminate in its entirety, and all the Purchased Shares shall vest in full, immediately prior to the consummation of any Change in Control. 

ARTICLE V 

RIGHT OF FIRST REFUSAL 

        Section 5.1     Grant.     The Company is hereby granted the right of first refusal (the "First Refusal Right"), exercisable in connection with any proposed transfer of the Purchased Shares in which Optionee has vested in accordance with the provisions of Article IV. For purposes of this Article V the term "transfer" shall include any sale, assignment, pledge, encumbrance or other disposition of the Purchased Shares intended to be made by Owner, but shall not include any Permitted Transfer. 

        Section 5.2     Notice of Intended Disposition.     In the event any Owner of Purchased Shares in which Optionee has vested desires to accept a bona fide third-party offer for the transfer of any or all of such 

28

shares (the Purchased Shares subject to such offer to be hereinafter referred to as the "Target Shares"), Owner shall promptly (i) deliver to the Company written notice (the "Disposition Notice") of the terms of the offer, including the purchase price and the identity of the third-party offeror, and (ii) provide satisfactory proof that the disposition of the Target Shares to such third-party offeror would not be in contravention of the provisions set forth in Articles II and III. 

        Section 5.3     Exercise of the First Refusal Right.     The Company shall, for a period of twenty-five (25) days following receipt of the Disposition Notice, have the right to repurchase any or all of the Target Shares subject to the Disposition Notice upon the same terms as those specified therein or upon such other terms (not materially different from those specified in the Disposition Notice) to which Owner consents. Such right shall be exercisable by delivery of written notice (the "Exercise Notice") to Owner prior to the expiration of the twenty-five (25)-day exercise period. If such right is exercised with respect to all the Target Shares, then the Company shall effect the repurchase of such shares, including payment of the purchase price, not more than five (5) business days after delivery of the Exercise Notice; and at such time the certificates representing the Target Shares shall be delivered to the Company. 

        Should the purchase price specified in the Disposition Notice be payable in property other than cash or evidences of indebtedness, the Company shall have the right to pay the purchase price in the form of cash equal in amount to the value of such property. If Owner and the Company cannot agree on such cash value within ten (10) days after the Company's receipt of the Disposition Notice, the valuation shall be made by an appraiser of recognized standing selected by Owner and the Company or, if they cannot agree on an appraiser within twenty (20) days after the Company's receipt of the Disposition Notice, each shall select an appraiser of recognized standing and the two (2) appraisers shall designate a third appraiser of recognized standing, whose appraisal shall be determinative of such value. The cost of such appraisal shall be shared equally by Owner and the Company. The closing shall then be held on the later of (i) the fifth (5th) business day following delivery of the Exercise Notice or (ii) the fifth (5th) business day after such valuation shall have been made. 

        Section 5.4     Non-Exercise of the First Refusal Right.     In the event the Exercise Notice is not given to Owner prior to the expiration of the twenty-five (25)-day exercise period, Owner shall have a period of thirty (30) days thereafter in which to sell or otherwise dispose of the Target Shares to the third-party offeror identified in the Disposition Notice upon terms (including the purchase price) no more favorable to such third-party offeror than those specified in the Disposition Notice; provided, however, that any such sale or disposition must not be effected in contravention of the provisions of Articles II and III. The third-party offeror shall acquire the Target Shares subject to the First Refusal Right and the provisions and restrictions of Article II and Section 3.3, and any subsequent disposition of the acquired shares must be effected in compliance with the terms and conditions of such First Refusal Right and the provisions and restrictions of Article II and Section 3.3. In the event Owner does not effect such sale or disposition of the Target Shares within the specified thirty (30)-day period, the First Refusal Right shall continue to be applicable to any subsequent disposition of the Target Shares by Owner until such right lapses. 

        Section 5.5     Partial Exercise of the First Refusal Right.     In the event the Company makes a timely exercise of the First Refusal Right with respect to a portion, but not all, of the Target Shares specified in the Disposition Notice, Owner shall have the option, exercisable by written notice to the Company delivered within five (5) business days after Owner's receipt of the Exercise Notice, to effect the sale of the Target Shares pursuant to either of the following alternatives: 

        (a)   sale or other disposition of all the Target Shares to the third-party offeror identified in the Disposition Notice, but in full compliance with the requirements of Section 5.4, as if the Company did not exercise the First Refusal Right; or 

        (b)   sale to the Company of the portion of the Target Shares which the Company has elected to purchase, such sale to be effected in substantial conformity with the provisions of Section 5.3. The First Refusal Right shall continue to be applicable to any subsequent disposition of the remaining Target Shares until such right lapses. 

29

        Owner's failure to deliver timely notification to the Company shall be deemed to be an election by Owner to sell the Target Shares pursuant to alternative (i) above. 

        Section 5.6     Recapitalization/Reorganization.      

        (a)   Any new, substituted or additional securities or other property which is by reason of any Recapitalization distributed with respect to the Purchased Shares shall be immediately subject to the First Refusal Right, but only to the extent the Purchased Shares are at the time covered by such right. 

        (b)   In the event of a Reorganization, the First Refusal Right shall remain in full force and effect and shall apply to the new capital stock or other property received in exchange for the Purchased Shares in consummation of the Reorganization, but only to the extent the Purchased Shares are at the time covered by such right. 

        Section 5.7     Lapse.     The First Refusal Right shall lapse upon the earliest to occur of (i) the first date on which shares of the Common Stock are held of record by more than five hundred (500) persons, (ii) a determination made by the Board that a public market exists for the outstanding shares of Common Stock or (iii) a firm commitment underwritten public offering, pursuant to an effective registration statement under the 1933 Act, covering the offer and sale of the Common Stock in the aggregate amount of at least twenty million dollars ($20,000,000). However, the Market Stand-Off shall continue to remain in full force and effect following the lapse of the First Refusal Right. 

ARTICLE VI 

SPECIAL TAX ELECTION 

        The acquisition of the Purchased Shares may result in adverse tax consequences which may be avoided or mitigated by filing an election under Code Section 83(b). Such election must be filed within thirty (30) days after the date of this Agreement. A description of the tax consequences applicable to the acquisition of the Purchased Shares and the form for making the Code Section 83(b) election are set forth in Exhibit II . OPTIONEE SHOULD CONSULT WITH HIS OR HER TAX ADVISOR TO DETERMINE THE TAX CONSEQUENCES OF ACQUIRING THE PURCHASED SHARES AND THE ADVANTAGES AND DISADVANTAGES OF FILING THE CODE SECTION 83(b) ELECTION. OPTIONEE ACKNOWLEDGES THAT IT IS OPTIONEE'S SOLE RESPONSIBILITY, AND NOT THE COMPANY'S, TO FILE A TIMELY ELECTION UNDER CODE SECTION 83(b), EVEN IF OPTIONEE REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON HIS OR HER BEHALF. 

ARTICLE VII 

GENERAL PROVISIONS 

        Section 7.1     Assignment.     The Company may assign the Repurchase Right and/or the First Refusal Right to any person or entity selected by the Board, including one or more stockholders of the Company. 

        Section 7.2     At Will Employment.     Nothing in this Agreement or in the Plan shall confer upon Optionee any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining Optionee) or of Optionee, which rights are hereby expressly reserved by each, to terminate Optionee's Service at any time for any reason, with or without cause. 

        Section 7.3     Notices.     Any notice required to be given under this Agreement shall be in writing and shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, registered or certified, postage prepaid and properly addressed to the party entitled to such notice at the address indicated below 

30

such party's signature line on this Agreement or at such other address as such party may designate by ten (10) days advance written notice under this paragraph to all other parties to this Agreement. 

        Section 7.4     No Waiver.     The failure of the Company in any instance to exercise the Repurchase Right or the First Refusal Right shall not constitute a waiver of any other repurchase rights and/or rights of first refusal that may subsequently arise under the provisions of this Agreement or any other agreement between the Company and Optionee. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition, whether of like or different nature. 

        Section 7.5     Cancellation of Shares.     If the Company shall make available, at the time and place and in the amount and form provided in this Agreement, the consideration for the Purchased Shares to be repurchased in accordance with the provisions of this Agreement, then from and after such time, the person from whom such shares are to be repurchased shall no longer have any rights as a holder of such shares (other than the right to receive payment of such consideration in accordance with this Agreement). Such shares shall be deemed purchased in accordance with the applicable provisions hereof, and the Company shall be deemed the owner and holder of such shares, whether or not the certificates therefor have been delivered as required by this Agreement. 

ARTICLE VIII 

MISCELLANEOUS PROVISIONS 

        Section 8.1     Optionee Undertaking.     Optionee hereby agrees to take whatever additional action and execute whatever additional documents the Company may deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on either Optionee or the Purchased Shares pursuant to the provisions of this Agreement. 

        Section 8.2     Agreement is Entire Contract.     This Agreement constitutes the entire contract between the parties hereto with regard to the subject matter hereof. This Agreement is made pursuant to the provisions of the Plan and shall in all respects be construed in conformity with the terms of the Plan. 

        Section 8.3     Governing Law.     This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware without resort to that State's conflict-of-laws rules. 

        Section 8.4     Counterparts.     This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument. 

        Section 8.5     Successors and Assigns.     The provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and upon Optionee, Optionee's permitted assigns and the legal representatives, heirs and legatees of Optionee's estate, whether or not any such person shall have become a party to this Agreement and have agreed in writing to join herein and be bound by the terms hereof. 

         IN WITNESS WHEREOF , the parties have executed this Agreement on the day and year first indicated above. 

				
	  

	  

	COMPANY: 

	

  

	

  

	B2 HEALTH, INC.

	

  

	

  

	

By: _______________________________________

	

	

  

	

  

	

Title: 

	 

31

				
	

  

	

  

	

OPTIONEE: 

	

  

	

  

	

________________________________

Signature: 

	 
	

  

	

  

	

_________________________________

Printed Name: 

	 
	

  

	

  

	

_________________________________

_________________________________

Address: 

	 
	

  

	

  

	

  

	 

SPOUSAL ACKNOWLEDGMENT 

        The undersigned spouse of Optionee has read and hereby approves the foregoing Stock Purchase Agreement. In consideration of the Company's granting Optionee the right to acquire the Purchased Shares in accordance with the terms of such Agreement, the undersigned hereby agrees to be irrevocably bound by all the terms of such Agreement, including (without limitation) the right of the Company (or its assigns) to purchase any Purchased Shares in which Optionee is not vested at time of his or her cessation of Service. 

				
	  

	  

	  

	_________________________________

OPTIONEE'S SPOUSE 

	

  

	

  

	

Address: 

	

_________________________________

	

  

	

  

	

  

	

_________________________________

32

EXHIBIT I 

ASSIGNMENT SEPARATE FROM CERTIFICATE 

         FOR VALUE RECEIVED  ______________________ hereby sell(s), assign(s) and transfer(s) unto B2 Health, Inc., a Delaware Corporation (the "Company"), ___________   ( ______________  ) shares of the Common Stock of the Company standing in his or her name on the books of the Company represented by Certificate No. __________________  herewith and do(es) hereby irrevocably constitute and appoint ____________________ Attorney to transfer the said stock on the books of the Company with full power of substitution in the premises. 

Dated ________________________

				
	  

	  

	Signature: 

	________________________________

        Instruction:     Please do not fill in any blanks other than the signature line. Please sign exactly as you would like your name to appear on the issued stock certificate. The purpose of this assignment is to enable the Company to exercise the Repurchase Right without requiring additional signatures on the part of Optionee. 

33

EXHIBIT II 

FEDERAL INCOME TAX CONSEQUENCES AND SECTION 83(b) TAX ELECTION 

        I.      Federal Income Tax Consequences and Section 83(b) Election For Exercise of Non-Statutory Option.     If the Purchased Shares are acquired pursuant to the exercise of a Non-Statutory Option, as specified in the Grant Notice, then under Code Section 83, the excess of the Fair Market Value of the Purchased Shares on the date any forfeiture restrictions applicable to such shares lapse over the Exercise Price paid for those shares will be reportable as ordinary income on the lapse date. For this purpose, the term "forfeiture restrictions" includes the right of the Company to repurchase the Purchased Shares pursuant to the Repurchase Right. However, Optionee may elect under Code Section 83(b) to be taxed at the time the Purchased Shares are acquired, rather than when and as such Purchased Shares cease to be subject to such forfeiture restrictions. Such election must be filed with the Internal Revenue Service within thirty (30) days after the date of the Agreement. Even if the Fair Market Value of the Purchased Shares on the date of the Agreement equals the Exercise Price paid (and thus no tax is payable), the election must be made to avoid adverse tax consequences in the future. The form for making this election is attached as part of this exhibit . FAILURE TO MAKE THIS FILING WITHIN THE APPLICABLE THIRTY (30)-DAY PERIOD WILL RESULT IN THE RECOGNITION OF ORDINARY INCOME BY OPTIONEE AS THE FORFEITURE RESTRICTIONS LAPSE. 

        II.      Federal Income Tax Consequences and Conditional Section 83(b) Election For Exercise of Incentive Option.     If the Purchased Shares are acquired pursuant to the exercise of an Incentive Option, as specified in the Grant Notice, then the following tax principles shall be applicable to the Purchased Shares: 

          (i)  For regular tax purposes, no taxable income will be recognized at the time the Option is exercised. 

         (ii)  The excess of (a) the Fair Market Value of the Purchased Shares on the date the Option is exercised or (if later) on the date any forfeiture restrictions applicable to the Purchased Shares lapse over (b) the Exercise Price paid for the Purchased Shares will be includible in Optionee's taxable income for alternative minimum tax purposes. 

        (iii)  If Optionee makes a disqualifying disposition of the Purchased Shares, then Optionee will recognize ordinary income in the year of such disposition equal in amount to the excess of (a) the Fair Market Value of the Purchased Shares on the date the Option is exercised or (if later) on the date any forfeiture restrictions applicable to the Purchased Shares lapse over (b) the Exercise Price paid for the Purchased Shares. Any additional gain recognized upon the disqualifying disposition will be either short-term or long-term capital gain depending upon the period for which the Purchased Shares are held prior to the disposition. 

        (iv)  For purposes of the foregoing, the term "forfeiture restrictions" will include the right of the Company to repurchase the Purchased Shares pursuant to the Repurchase Right. The term "disqualifying disposition" means any sale or other disposition 1 of the Purchased Shares within two (2) years after the Grant Date or within one (1) year after the exercise date of the Option. 

Generally, a disposition of shares purchased under an Incentive Option includes any transfer of legal title, including a transfer by sale, exchange or gift, but does not include a transfer to the Optionee's spouse, a transfer into joint ownership with right of survivorship if Optionee remains one of the joint owners, a pledge, a transfer by bequest or inheritance or certain tax-free exchanges permitted under the Code. 

34

         (v)  In the absence of final Treasury Regulations relating to Incentive Options, it is not certain whether Optionee may, in connection with the exercise of the Option for any Purchased Shares at the time subject to forfeiture restrictions, file a protective election under Code Section 83(b) which would limit Optionee's ordinary income upon a disqualifying disposition to the excess of the Fair Market Value of the Purchased Shares on the date the Option is exercised over the Exercise Price paid for the Purchased Shares. Accordingly, such election if properly filed will only be allowed to the extent the final Treasury Regulations permit such a protective election. 

        (vi)  The Code Section 83(b) election will be effective in limiting the Optionee's alternative minimum taxable income to the excess of the Fair Market Value of the Purchased Shares at the time the Option is exercised over the Exercise Price paid for those shares. 

        Page 2 of the attached form for making the election should be filed with any election made in connection with the exercise of an Incentive Option. 

35

SECTION 83(b) ELECTION 

        This statement is being made under Section 83(b) of the Internal Revenue Code, pursuant to Treas. Reg. Section 1.83-2. 

(1) 

The taxpayer who performed the services is: 

Name: __________________________________

Address: _________________________________

________________________________________

Taxpayer Ident. No.: _______________________

(2) 

The property with respect to which the election is being made is _________ shares of the common stock of ______________________________ 

(3) 

The property was issued on  ______________, 20___.

(4) 

The taxable year in which the election is being made is the calendar year __________.

(5) 

The property is subject to a repurchase right pursuant to which the issuer has the right to acquire the property at the lower of the purchase price paid per share or the fair market value per share, if for any reason taxpayer's service with the issuer terminates. The issuer's repurchase right will lapse in a series of annual and monthly installments over a four (4)-year period ending on  _________________ , 20___.

(6) 

The fair market value at the time of transfer (determined without regard to any restriction other than a restriction which by its terms will never lapse) is $ _____________ per share. 

(7) 

The amount paid for such property is $ _______________per share. 

(8)

A copy of this statement was furnished to ____________ for whom taxpayer rendered the services underlying the transfer of property. 

(9) 

This statement is executed on  _________________ , 20____.

			
	___________________________

Spouse (if any) 

	  

	___________________________

Taxpayer 

         This election must be filed with the Internal Revenue Service Center with which taxpayer files his or her Federal income tax returns and must be made within thirty (30) days after the execution date of the Stock Purchase Agreement. This filing should be made by registered or certified mail, return receipt requested. Optionee must retain two (2) copies of the completed form for filing with his or her Federal and state tax returns for the current tax year and an additional copy for his or her records. 

        The property described in the above Section 83(b) election is comprised of shares of common stock acquired pursuant to the exercise of an incentive stock option under Section 422 of the Internal Revenue Code (the "Code"). Accordingly, it is the intent of the Taxpayer to utilize this election to achieve the following tax results: 

        1.     One purpose of this election is to have the alternative minimum taxable income attributable to the purchased shares measured by the amount by which the fair market value of such shares at the time of their transfer to the Taxpayer exceeds the purchase price paid for the shares. In the absence of this election, such alternative minimum taxable income would be measured by the spread between the fair market value of the 

36

purchased shares and the purchase price which exists on the various lapse dates in effect for the forfeiture restrictions applicable to such shares. 

        2.     Section 421(a)(1) of the Code expressly excludes from income any excess of the fair market value of the purchased shares over the amount paid for such shares. Accordingly, this election is also intended to be effective in the event there is a "disqualifying disposition" of the shares, within the meaning of Section 421(b) of the Code, which would otherwise render the provisions of Section 83(a) of the Code applicable at that time. Consequently, the Taxpayer hereby elects to have the amount of disqualifying disposition income measured by the excess of the fair market value of the purchased shares on the date of transfer to the Taxpayer over the amount paid for such shares. Since Section 421(a) presently applies to the shares which are the subject of this Section 83(b) election, no taxable income is actually recognized for regular tax purposes at this time, and no income taxes are payable, by the Taxpayer as a result of this election. The foregoing election is to be effective to the full extent permitted under the Code. 

         THIS PAGE 2 IS TO BE ATTACHED TO ANY SECTION 83(b) ELECTION FILED IN CONNECTION WITH THE EXERCISE OF AN INCENTIVE STOCK OPTION UNDER THE FEDERAL TAX LAWS. 

A-2 

37

 

Exhibit 10.6 

B2 HEALTH, INC. 

STOCK OPTION AGREEMENT 

        This Stock Option Agreement (the "Agreement") is attached as Exhibit A to a Notice of Grant of Stock Option (the "Grant Notice"), pursuant to which Optionee has been informed of the basic terms of the option evidenced thereby. Certain capitalized terms used but not otherwise defined herein have the respective meanings specified in the Grant Notice to which this Agreement relates. 

RECITALS 

        A.    The Board has adopted the Plan for the purpose of retaining the services of selected employees, non-employee members of the Board or the board of directors of any Subsidiary or Affiliate and consultants and other independent advisors in the service of the Company (or any Subsidiary or Affiliate). 

        B.    Optionee is to render valuable services to the Company (or a Subsidiary or Affiliate), and this Agreement is executed pursuant to, and is intended to carry out the purposes of, the Plan in connection with the Company's grant of an option to Optionee. 

        C.    Those capitalized terms used but not otherwise defined in this Agreement have the respective meanings specified in to the Plan. 

        NOW, THEREFORE, it is hereby agreed as follows: 

        1.     Grant of Option.     The Company hereby grants to Optionee, as of the Grant Date, an option to purchase up to the number of shares of Common Stock subject to the option (the "Option Shares") specified in the Grant Notice. The Option Shares shall be purchasable from time to time during the option term specified in Section 2 at the Exercise Price. 

        2.     Option Term.     This option shall expire at the close of business on the Expiration Date or on the date on which the option shall have been exercised in full in accordance with Section 9 hereof (the "Exercise Date"), unless sooner terminated in accordance with Section 5 or 6 hereof. 

        3.     Limited Transferability.      

        (a)   This option shall be neither transferable nor assignable by Optionee other than by will or the laws of inheritance following Optionee's death and may be exercised, during Optionee's lifetime, only by Optionee. However, Optionee may designate one or more persons as the beneficiary or beneficiaries of this option, and this option shall, in accordance with such designation, automatically be transferred to such beneficiary or beneficiaries upon the Optionee's death while holding this option. Such beneficiary or beneficiaries shall take the transferred option subject to all the terms and conditions of this Agreement, including (without limitation) the limited time period during which this option may, pursuant to Section 5, be exercised following Optionee's death. 

38

        (b)   If this option is designated a Non-Statutory Option in the Grant Notice, then this option may be assigned in whole or in part during Optionee's lifetime to one or more members of Optionee's family or to a trust established for the exclusive benefit of one or more such family members or to Optionee's former spouse, to the extent such assignment is in connection with the Optionee's estate plan or pursuant to a domestic relations order. The assigned portion shall be exercisable only by the person or persons who acquire a proprietary interest in the option pursuant to such assignment. The terms applicable to the assigned portion shall be the same as those in effect for this option immediately prior to such assignment. 

        4.     Dates of Exercise.     This option shall become exercisable for the Option Shares in one or more installments as specified in the Grant Notice. As the option becomes exercisable for such installments, those installments shall accumulate, and the option shall remain exercisable for the accumulated installments until the Expiration Date or sooner termination of the option term under Section 5 or 6. 

        5.     Cessation of Service.     The option term specified in Section 2 shall terminate (and this option shall cease to be outstanding) prior to the Expiration Date should any of the following provisions become applicable: 

        (a)   Should Optionee cease to remain in Service for any reason (other than death, Disability or Cause) while this option is outstanding, then Optionee (or any person or persons to whom this option is transferred pursuant to a permitted transfer under Section 3) shall have a period of three (3) months (commencing with the date of such cessation of Service) during which to exercise this option, but in no event shall this option be exercisable at any time after the Expiration Date. 

        (b)   Should Optionee die while this option is outstanding, then the personal representative of Optionee's estate or the person or persons to whom the option is transferred pursuant to Optionee's will or the laws of inheritance following Optionee's death or to whom the option is transferred during Optionee's lifetime pursuant to a permitted transfer under Section 3 shall have the right to exercise this option. However, if Optionee dies while holding this option and if Optionee has an effective beneficiary designation in effect for this option at the time of his or her death, then the designated beneficiary or beneficiaries shall have the exclusive right to exercise this option following Optionee's death. Any such right to exercise this option shall lapse, and this option shall cease to be outstanding, upon the earlier of (i) the expiration of the twelve (12)-month period measured from the date of Optionee's death or (ii) the Expiration Date. 

        (c)   Should Optionee cease Service by reason of Disability while this option is outstanding, then Optionee (or any person or persons to whom this option is transferred pursuant to a permitted transfer under Section 3) shall have a period of twelve (12) months (commencing with the date of such cessation of Service) during which to exercise this option. In no event shall this option be exercisable at any time after the Expiration Date. 

        Note:     Exercise of this option on a date later than three (3) months following cessation of Service due to Disability will result in loss of favorable Incentive Option treatment, unless such Disability constitutes a total and permanent disability within the meaning of Section 22(e)(3) of the Internal Revenue Code. In the event that Incentive Option treatment is not available, this option will be taxed as a Non-Statutory Option upon exercise. 

        (d)   During the limited period of post-Service exercisability, this option may not be exercised in the aggregate for more than the number of Option Shares in which Optionee is, at the time of Optionee's cessation of Service, vested pursuant to the Vesting Schedule specified in the Grant Notice or the special vesting acceleration provisions of Section 6. Upon the expiration of such limited exercise period or (if earlier) upon the Expiration Date, this option shall terminate and cease to be outstanding for any vested Option Shares for which the option has not been exercised. To the extent Optionee is not vested in one or more Option Shares at the time of Optionee's 

39

cessation of Service, this option shall immediately terminate and cease to be outstanding with respect to those shares. 

        (e)   Should Optionee's Service be terminated for Cause or should Optionee otherwise engage in Cause while this option is outstanding, then this option shall terminate immediately and cease to remain outstanding. 

        6.     Accelerated Vesting.      

        (a)   In the event of any Change in Control, the Option Shares at the time subject to this option but not otherwise vested shall automatically vest in full so that this option shall, immediately prior to the effective date of the Change in Control, become exercisable for all of the Option Shares as fully vested shares and may be exercised for any or all of those Option Shares as vested shares. 

        (b)   This Agreement shall not in any way affect the right of the Company 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. 

        7.     Adjustment in Option Shares.     Should any change be made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without the Company's receipt of consideration, appropriate adjustments shall be made to (i) the total number and/or class of securities subject to this option and (ii) the Exercise Price in order to reflect such change and thereby preclude a dilution or enlargement of benefits hereunder. 

        8.     Stockholder Rights.     The holder of this option shall not have any stockholder rights with respect to the Option Shares until such person shall have exercised the option, paid the Exercise Price and become the record holder of the purchased shares. 

        9.     Manner of Exercising Option.      

        (a)   In order to exercise this option with respect to all or any part of the Option Shares for which this option is at the time exercisable, Optionee (or any other person or persons exercising the option) must take the following actions: 

          (i)  Execute and deliver to the Company a Purchase Agreement for the Option Shares for which the option is exercised. 

         (ii)  Pay the aggregate Exercise Price for the purchased shares in one or more of the following forms: 

        (A)  cash or check made payable to the Company; or 

        (B)  a promissory note payable to the Company, but only to the extent authorized by the Plan Administrator in accordance with Section 14. 

        (iii)  Should the Common Stock be registered under Section 12 of the 1934 Act at the time the option is exercised, then the Exercise Price may also be paid as follows: 

        (A)  in shares of Common Stock held by Optionee (or any other person or persons exercising the option) for the requisite period necessary to avoid a 

40

charge to the Company's earnings for financial reporting purposes and valued at Fair Market Value on the Exercise Date; or 

        (B)  to the extent the option is exercised for vested Option Shares, through a special sale and remittance procedure pursuant to which Optionee (or any other person or persons exercising the option) shall concurrently provide irrevocable instructions (a) to a Company-designated brokerage firm to effect the immediate sale of the purchased shares and remit to the Company, out of the sale proceeds available on the settlement date, sufficient funds to cover the aggregate Exercise Price payable for the purchased shares plus all applicable income and employment taxes required to be withheld by the Company by reason of such exercise and (b) to the Company to deliver the certificates for the purchased shares directly to such brokerage firm in order to complete the sale. 

        Except to the extent the sale and remittance procedure is utilized in connection with the option exercise, payment of the Exercise Price must accompany the Purchase Agreement delivered to the Company in connection with the option exercise. 

        (iv)  Furnish to the Company appropriate documentation that the person or persons exercising the option (if other than Optionee) have the right to exercise this option. 

         (v)  Execute and deliver to the Company such written representations as may be requested by the Company in order for it to comply with the applicable requirements of applicable securities laws. 

        (vi)  Make appropriate arrangements with the Company (or Subsidiary or Affiliate employing or retaining Optionee) for the satisfaction of all applicable income and employment tax withholding requirements applicable to the option exercise. 

        (b)   As soon as practical after the Exercise Date, the Company shall issue to or on behalf of Optionee (or any other person or persons exercising this option) a certificate for the purchased Option Shares, with the appropriate legends affixed thereto. 

        (c)   In no event may this option be exercised for any fractional shares. 

        10.      REPURCHASE RIGHTS.     ALL OPTION SHARES ACQUIRED UPON THE EXERCISE OF THIS OPTION SHALL BE SUBJECT TO CERTAIN RIGHTS OF THE COMPANY AND ITS ASSIGNS TO REPURCHASE THOSE SHARES IN ACCORDANCE WITH THE TERMS SPECIFIED IN THE PURCHASE AGREEMENT. 

        11.     Compliance with Laws and Regulations.      

        (a)   The exercise of this option and the issuance of the Option Shares upon such exercise shall be subject to compliance by the Company and Optionee with all applicable requirements of law relating thereto and with all applicable regulations of any stock exchange (or the Nasdaq National Market, if applicable) on which the Common Stock may be listed for trading at the time of such exercise and issuance. 

        (b)   The inability of the Company to obtain approval from any regulatory body having authority deemed by the Company to be necessary to the lawful issuance and sale of any Common Stock pursuant to this option shall relieve the Company of any liability with respect to the non-issuance or sale of the Common Stock as to which such approval shall not have been obtained. The Company, however, shall use its best efforts to obtain all such approvals. 

41

        12.     Successors and Assigns.     Except to the extent otherwise provided in Sections 3 and 6, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and Optionee, Optionee's assigns and the legal representatives, heirs and legatees of Optionee's estate. 

        13.     Notices.     Any notice required to be given or delivered to the Company under the terms of this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice required to be given or delivered to Optionee shall be in writing and addressed to Optionee at the address indicated below Optionee's signature line on the Grant Notice. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified. 

        14.     Financing.     To the extent permitted by applicable law, the Plan Administrator may, in its absolute discretion and without any obligation to do so, permit Optionee to pay the Exercise Price for the purchased Option Shares (to the extent such Exercise Price is in excess of the par value of those shares) by delivering a full-recourse promissory note bearing interest at a market rate and secured by those Option Shares. The payment schedule in effect for any such promissory note shall be established by the Plan Administrator in its sole discretion. 

        15.     Construction.     This Agreement and the option evidenced hereby are made and granted pursuant to the Plan and are in all respects limited by and subject to the terms of the Plan. All decisions of the Plan Administrator with respect to any question or issue arising under the Plan or this Agreement shall be conclusive and binding on all persons having an interest in this option. 

        16.     Governing Law.     The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of Delaware without resort to that State's conflict-of-laws rules. 

        17.     Stockholder Approval.     If the Option Shares covered by this Agreement exceed, as of the Grant Date, the number of shares of Common Stock which may be issued under the Plan as last approved by the stockholders, then this option shall be void with respect to such excess shares, unless stockholder approval of an amendment sufficiently increasing the number of shares of Common Stock issuable under the Plan is obtained in accordance with the provisions of the Plan. 

        18.     Additional Terms Applicable to an Incentive Option.     In the event this option is designated an Incentive Option in the Grant Notice, the following terms and conditions shall also apply to the grant: 

        (a)   This option shall cease to qualify for favorable tax treatment as an Incentive Option if (and to the extent) this option is exercised for one or more Option Shares: (i) more than three (3) months after the date Optionee ceases to be an employee for any reason other than death or Disability or (ii) more than twelve (12) months after the date Optionee ceases to be an employee by reason of Disability. 

        (b)   This option shall not become exercisable in the calendar year in which granted if (and to the extent) the aggregate Fair Market Value (determined at the Grant Date) of the Common Stock for which this option would otherwise first become exercisable in such calendar year would, when added to the aggregate value (determined as of the respective date or dates of grant) of the Common Stock and any other securities for which one or more other Incentive Options granted to Optionee prior to the Grant Date (whether under the Plan or any other option plan of the Company or any Subsidiary) first become exercisable during the same calendar year, exceed One Hundred Thousand Dollars ($100,000) in the aggregate. To the extent the exercisability of this option is deferred by reason of the foregoing limitation, the deferred portion shall become exercisable in the first calendar year or years thereafter in which the One Hundred Thousand Dollar ($100,000) limitation of this Section 18(b) would not be contravened, but such deferral shall in all events end immediately prior to the effective date of a Change in Control in which this option is not to be 

42

assumed or otherwise continued in effect, whereupon the option shall become immediately exercisable as a Non-Statutory Option for the deferred portion of the Option Shares. 

(c)

Should Optionee hold, in addition to this option, one or more other options to purchase Common Stock which become exercisable for the first time in the same calendar year as this option, then the foregoing limitations on the exercisability of such options as Incentive Options shall be applied on the basis of the order in which such options are granted. 

43

 

Exhibit 10.7 

B2 Health, Inc.

Restricted Stock Award Grant Notice 

        B2 Health, Inc., a Delaware corporation (the "Company") hereby acknowledges its obligation to award to Participant, on the dates set forth below, that number of shares of the Company's Common Stock set forth below ("Award") if Participant remains employed by the Company as of each such date. This Award is subject to all of the terms and conditions as set forth herein and in the Restricted Stock Award Agreement and all of the shares issued pursuant to this Award will be issued pursuant to the Company's 2006 Equity Incentive Plan (the "Plan"), all of which are attached hereto and incorporated herein in their entirety. 

					
	Participant:  

	  

	________________________

	  

	  

	

Date of Grant:  

	

  

	

	

  

	

  

	

Number of Shares Subject to Award:  

	

  

	

______________

	

  

	

  

	

Consideration:  

	

  

	

____________________ 

	

  

	

  

        Grant Schedule:                                                                                                                                                                                                                                                                                       . All shares that have not been issued shall be issued immediately upon any Termination of Employment (as defined in the Plan) by the Company other than for Cause (as defined in the Plan). In the event that the Participant suffers a Termination of Employment by reason of Death (as defined in the Plan), Disability (as defined in the Plan), Retirement (as defined in the Plan), voluntary termination by Employee, or is terminated by the Company for Cause, the Participant shall not be entitled to the issuance of any shares of Common Stock that have not been previously granted as of the date of such Termination of Employment. 

        Additional Terms/Acknowledgements:     The undersigned Participant acknowledges receipt of, and understands and agrees to, this Restricted Stock Award Notice, the Restricted Stock Award Agreement and the Plan. Participant further acknowledges that as of the date hereof, this Restricted Stock Award Notice, the Restricted Stock Award Agreement and the Plan set forth the entire understanding between Participant and the Company regarding the acquisition of stock in the Company and supersede all prior oral and written agreements on that subject with the exception of (i) Awards previously granted and delivered to Participant under the Plan, and (ii) the following agreements only: 

			
	Other Agreements: 

	  

	 
	

  

	

  

	

         PARTICIPANT ACKNOWLEDGES AND AGREES THAT HE OR SHE HAS NO RIGHTS TO ACQUIRE COMMON STOCK OF THE COMPANY, AND THE COMPANY HAS NOT MADE ANY PROMISES TO ISSUE COMMON STOCK TO PARTICIPANT, EXCEPT AS SET FORTH IN THIS RESTRICTED STOCK AWARD NOTICE AND IN THE OTHER AGREEMENTS (IF ANY). 

44

							
	Company:

	  

	Participant: 

	

By: 

     

	

  

	

_____________________

Signature 

	

  

	

_________________________

Signature 

	

Title: 

	

  

	

_____________________

	

  

	

Date: 

	

  

	

___________________

	

Date 

	

  

	

_____________________

	

  

	

  

	

  

	

  

        Attachments:     Restricted Stock Award Agreement and 2006 Equity Incentive Plan. 

45

Attachment I 

RESTRICTED STOCK AWARD AGREEMENT 

Filed as Exhibit 10.8 

Attachment II 

B2 HEALTH, INC., 2006 EQUITY INCENTIVE PLAN 

Filed as Exhibit 10.2 

 

46

 

Exhibit 10.8 

B2 HEALTH, INC.

Restricted Stock Award Agreement 

        Pursuant to the Restricted Stock Award Grant Notice ("Grant Notice") to which this Restricted Stock Award Agreement is attached as Attachment I (this "Agreement;" and together with the Grant Notice, the "Award") and in consideration for services rendered or to be rendered to B2 Health, Inc., (the "Company"), the Company acknowledges its understanding and agreement to issue to you, under its 2006 Equity Incentive Plan (the "Plan"), that number of shares of the Company's Common Stock specified in the Grant Notice in accordance with the Grant Schedule. Capitalized terms used but not defined terms in this Agreement shall have the meaning ascribed to them in the Plan. 

        The details of your Award are as follows: 

         1.    Grants.     Subject to the limitations contained herein, your right to receive future issuances of the Company's Common Stock will survive as provided in the Grant Notice, provided that all rights under the Award will cease upon your Termination of Employment. 

         2.    Securities Law Compliance.     You may not be issued any shares under your Award unless the shares are either (i) then registered under the Securities Act or (ii) the Company has determined that such issuance would be exempt from the registration requirements of the Securities Act. Your Award must also comply with other applicable laws and regulations governing the Award, and you will not receive such shares if the Company determines that such receipt would not be in material compliance with such laws and regulations. 

         3.    Restrictions on Transfer.      

         (a)    You agree that the Company (or a representative of the underwriters) may, in connection with the first underwritten registration of the offering of any securities of the Company under the Securities Act, require that you not sell, dispose of, transfer, pledge, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale, any shares of Common Stock or other securities of the Company held by you under the Award, for a period of time specified by the underwriter(s) (not to exceed one hundred eighty (180) days) following the effective date of the registration statement of the Company filed under the Securities Act (or such longer period, not to exceed eighteen (18) days after expiration of the one hundred eighty (180) day period, as the Company or the underwriters shall request in order to facilitate compliance with NASD Rule 2711). 

         (b)    You agree to execute and deliver such other agreements as may be reasonably requested by the Company and/or the underwriter(s) that are consistent with the foregoing or that are necessary to give further effect thereto. In addition, if requested by the Company or the representative of underwriters of Common Stock of the Company, you shall provide, within ten (10) days of such request, such information as may be required by the Company or such representative in connection with the completion of any public offering of the Company's securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms that may be promulgated in the future, or a registration 

47

relating solely to a Commission Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. In order to enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to your Common Stock until the end of such lock-up period. 

         4.    Changes In Capitalization.     The number of shares of the Company's Common Stock that shall be issued pursuant to the Award shall be proportionately adjusted for any increase or decrease in the Company's Common Stock resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Company's Common Stock, or any other increase or decrease in the number of issued shares of the Company's Common Stock effected without receipt or consideration by the Company. Such adjustments shall be made by the Company's Board of Directors, whose determination in that respect shall be final, binding and conclusive. 

         5.    Change in Control.     The stock grants contemplated by the Award shall accelerate upon a Change of Control so that all stock that is to be issued pursuant to the Award shall, immediately prior to the effective date of the Change of Control, be issued to you. This Agreement shall not in any way affect the right of the Company to adjust, reclassify, reorganize or otherwise changes its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets. 

         6.    Restrictive Legends.     The shares issued under your Award shall be endorsed with the legends set forth below or legends substantially equivalent thereto, as determined by the Company it its sole discretion, together with any other legends that may be required by the Company or by state or federal securities laws: 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS OF A RESTRICTED STOCK AWARD AGREEMENT, DATED AS OF ______________, 2006, BETWEEN THE COMPANY AND THE HOLDER OF THIS STOCK. 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS. 

THE HOLDER OF THIS STOCK MAY NOT SELL, TRANSFER OR DISPOSE OF THIS STOCK (EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE "ACT")) WITHOUT FIRST DELIVERING TO THE COMPANY AN OPINION OF COUNSEL (REASONABLY ACCEPTABLE IN FORM AND SUBSTANCE TO THE COMPANY) THAT NEITHER REGISTRATION NOR QUALIFICATION UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS IS REQUIRED IN CONNECTION WITH SUCH TRANSFER. 

         7.    Award not a Service Contract.     Your Award is not an employment or service contract, and nothing in your Award shall be deemed to create in any way whatsoever any obligation on your part to continue in the employ of the Company or an Affiliate, or on the part of the Company or an Affiliate to continue your employment. In addition, nothing in your Award shall obligate the Company or an Affiliate, their respective shareholders, boards of directors, officers or employees to continue any relationship that you might have as a director or consultant for the Company or an Affiliate. 

         8.    Not a Service Contract.     Your Award is not an employment or service contract, and nothing in your Award shall be deemed to create in any way whatsoever any obligation on your part to continue in the 

48

employ of the Company or an Affiliate, or on the part of the Company or an Affiliate to continue your employment 

         9.    Withholding Obligations.      

         (a)    At the time your Award is made, or at any time thereafter as requested by the Company, you hereby authorize withholding from payroll and any other amounts payable to you, and otherwise agree to make adequate provision for any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Company or an Affiliate, if any, which arise in connection with your Award. 

         (b)Unless the tax withholding obligations of the Company and/or any Affiliate are satisfied, the Company shall have no obligation to issue a certificate for such shares or release such shares from any escrow provided for herein. 

         10.    Rights as a Shareholder.     Until the Common Stock underlying this Award has been issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to the stock to be issued in Future Grants. 

         11.    Limitation on Change in Control Payments.     If (i) there is an acceleration of the stock grants contemplated by the Award (as provided in Section 5), (ii) such acceleration could be deemed a "payment" within the meaning of Section 280G(b)(2) of the Internal Revenue Code of 1986, as amended (the "Code"), and (iii) such payment together with any other payments which you have the right to receive from the Company or any corporation which is a member of an "affiliated group" (as defined in Section 1504(a) of the Code without regard to Section 1504(b) of the Code) of which the Company is a member would constitute a "parachute payment" (as defined in Section 280G(b)(2) of the Code), then the number of shares subject to acceleration under Section 5 hereof will be reduced to the largest amount as will result in no portion of such payments being subject to the excise tax imposed by Section 4999 of the Code. 

         12.    Notices.     Any notices provided for in your Award or the Plan shall be given in writing and shall be deemed effectively given upon receipt or, in the case of notices delivered by the Company to you, five (5) days after deposit in the United States mail, postage prepaid, addressed to you at the last address you provided to the Company. 

         13.    Miscellaneous.      

         (a)    The rights and obligations of the Company under your Award shall be transferable to any one or more persons or entities, and all covenants and agreements hereunder shall inure to the benefit of, and be enforceable by the Company's successors and assigns. Your rights and obligations under your Award may only be assigned with the prior written consent of the Company. 

         (b)    You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award. 

         (c)    You acknowledge and agree that you have reviewed your Award in its entirety, have had an opportunity to obtain the advice of counsel prior to executing and accepting your Award and fully understand all provisions of your Award. 

         (d)    The interpretation, performance and enforcement of this Award shall be governed by the laws of the State of Delaware without resort to that State's conflict-of-laws rules. 

49

         14.    Governing Plan Document.     Your Award is subject to all the provisions of the Plan, the provisions of which are hereby made a part of your Award, and is further subject to all interpretations, amendments, rules and regulations which may from time to time be promulgated and adopted pursuant to the Plan. In the event of any conflict between the provisions of your Award and those of the Plan, the provisions of the Plan shall control. 

 

50

Exhibit 10.9 

B2 HEALTH, INC.

NONSTATUTORY STOCK OPTION AGREEMENT 

        This Non-Statutory Stock Option Agreement (this "Agreement") is made as of  _____________, 2006 (the "Effective Date"), between B2 Health, Inc., a Delaware corporation (the "Company"), and  _______________________________ ("Optionee"). Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in Section II(15) of this Agreement. 

RECITALS 

        A.    On the Effective Date, the Board of Directors of the Company (the "Board") granted Optionee an option to purchase shares of the Company's Common Stock conditioned upon the Optionee's provision of Services to the Company. 

        B.    Optionee was notified of the option granted by the Board and the Company's internal records have reflected the option grant to Optionee. 

        C.    The Company and Optionee did not enter into a written agreement evidencing the issuance of the option and are entering into this Agreement for the purpose of memorializing the understanding of the parties as of the Effective Date. 

        D.    The Company and Optionee have agreed to the terms and conditions of, and desire to document the prior grant pursuant to, this Agreement. 

        NOW, THEREFORE, in consideration of the promises and the mutual agreements hereinafter contained, and for other good and valuable consideration, the parties agree as follows: 

I.      STOCK OPTION GRANT 

        1.     Grant of Option.     The Company hereby acknowledges and confirms that, as of the Effective Date, Optionee was granted an option (the "Option") to purchase the number of shares set forth below, at the exercise price per share set forth below (the "Exercise Price"), which exercise price was the fair market value of the Common Stock as of the Effective Date, and subject to the terms and conditions of this Agreement. 

			
	Date of Grant: 

	  

	__________________

	

Vesting Commencement Date: 

	

  

	

__________________

	

Exercise Price: 

	

  

	

$__________ per share 

	

Total Number of Shares Granted (the "Option Shares") 

	

  

	

_________________

	

Type of Option: 

	

  

	

Nonstatutory Stock Option 

	

Expiration Date: 

	

  

	

__________________

51

			

        2.     Vesting Schedule.     This Option Shares were initially unvested and became or shall become vested and exercisable, in whole or in part, according to the following vesting schedule: 

II.    TERMS AND CONDITIONS OF OPTION 

        1.     Exercise of Option.      

        (a)    Right to Exercise.     This Option shall be exercisable during its term in accordance with the Vesting Schedule set out in Section I and with the applicable provisions of this Agreement.

        (b)    Conditions for Exercise; Rights as a Stockholder.     The Option may not be exercised for a fraction of a share of the Company's Common Stock. Until the shares underlying the Option are purchased by Optionee and issued by the Company (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to the Option Shares. Should any change be made to the Common Stock of the Company by reason of any stock split, stock dividend, recapitalization, combination of stock, exchange of stock or other change affecting the Company's Common Stock without the Company's receipt of consideration, appropriate adjustments shall be made to (i) the total number and/or class of securities subject to this Option, and (ii) the Exercise Price in order to reflect such change and thereby preclude a dilution or enlargement of benefits hereunder. 

        (c)    Method of Exercise.     In order to exercise this Option with respect to all or any part of the Option Shares for which this Option is at the time exercisable, Optionee must take the following actions: 

          (i)  Execute and deliver to the Company the exercise notice (the "Exercise Notice") attached hereto as Exhibit A . 

         (ii)  Pay the aggregate Exercise Price for the purchased shares in one of the following forms: (A) by cash or check made payable to the Company, or (B) should the Common Stock be registered under Section 12 of the Securities Exchange Act of 1934 at the time the option is exercised, then the Exercise Price may also be paid through a special sale and remittance procedure pursuant to which Optionee (or any other person or persons exercising the option) concurrently provides irrevocable instructions (y) to a Company-designated brokerage firm to effect the immediate sale of the purchased shares and remit to the Company, out of the sale proceeds available on the settlement date, sufficient funds to cover the aggregate Exercise Price payable for the purchased shares plus all applicable income and employment taxes required to be withheld by the Company by reason of such exercise and (z) to the Company to deliver the certificates for the purchased shares directly to such brokerage firm in order to complete the sale. 

        (iii)  Furnish to the Company appropriate documentation that the person or persons exercising the Option (if other than Optionee) have the right to exercise this Option. 

        (iv)  If requested by the Company, execute and deliver to the Company the Investment Representation Statement attached hereto as Exhibit B . 

         (v)  Make appropriate arrangements with the Company for the satisfaction of all applicable income and employment tax withholding requirements applicable to the exercise of the Option. 

52

        (d)    Certificates.     As soon as practical after the Company receives the Exercise Notice, the Company shall issue to or on behalf of Optionee (or any other person exercising this Option) a certificate for the requisite number of shares of Common Stock, with the appropriate legends affixed thereto. 

        (e)    Exercise as to Vested Shares.     The Option may be exercised as to vested Option Shares only. 

        2.     Cessation of Service.     The Option shall terminate (and cease to be outstanding) prior to the Expiration Date should any of the following provisions become applicable: 

        (a)   Should Optionee cease to remain in Service for any reason (other than death, Disability or Misconduct) while this Option is outstanding, then Optionee (or any person or persons to whom this Option is transferred pursuant to a permitted transfer under Section II(3)) shall have a period of three (3) months (commencing with the date of such cessation of Service) during which to exercise this Option, but in no event shall this Option be exercisable at any time after the Expiration Date. 

        (b)   Should Optionee die while this Option is outstanding, then the personal representative of Optionee's estate or the person or persons to whom the Option is transferred pursuant to Optionee's will or the laws of inheritance following Optionee's death or to whom the Option is transferred during Optionee's lifetime pursuant to a permitted transfer under Section II(3) shall have the right to exercise this Option. However, if Optionee dies while holding this Option and if Optionee has an effective beneficiary designation in effect for this Option at the time of his or her death, then the designated beneficiary or beneficiaries shall have the exclusive right to exercise this Option following Optionee's death. Any such right to exercise this Option shall lapse, and this Option shall cease to be outstanding, upon the earlier of (i) the expiration of the twelve (12)-month period measured from the date of Optionee's death or (ii) the Expiration Date. 

        (c)   Should Optionee cease Service by reason of Disability while this Option is outstanding, then Optionee (or any person or persons to whom this Option is transferred pursuant to a permitted transfer under Section II(3)) shall have a period of twelve (12) months (commencing with the date of such cessation of Service) during which to exercise this Option. In no event shall this Option be exercisable at any time after the Expiration Date. 

        (d)   During the limited period of post-Service exercisability, this Option may not be exercised in the aggregate for more than the number of Option Shares in which Optionee is, at the time of Optionee's cessation of Service, vested pursuant to the Vesting Schedule or the special vesting acceleration provisions of Section II(4). Upon the expiration of such limited exercise period or (if earlier) upon the Expiration Date, this Option shall terminate and cease to be outstanding for any vested Option Shares for which the Option has not been exercised. To the extent Optionee is not vested in one or more Option Shares at the time of Optionee's cessation of Service, this Option shall immediately terminate and cease to be outstanding with respect to such Option Shares. 

        (e)   Should Optionee's Service be terminated for Misconduct or should Optionee otherwise engage in Misconduct while this Option is outstanding, then this Option shall terminate immediately and cease to remain outstanding and Optionee shall have no right to exercise vested or unvested Option Shares. 

        3.     Limited Transferability of Options.     This Option shall neither be transferable nor assignable by Optionee other than by will or the laws of inheritance following Optionee's death and may be exercised, during Optionee's lifetime, only by Optionee. However, Optionee may designate one or more persons as the beneficiary or beneficiaries of this Option, and this Option shall, in accordance with such designation, 

53

automatically be transferred to such beneficiary or beneficiaries upon the Optionee's death while holding this Option. Such beneficiary or beneficiaries shall take the transferred Option subject to all the terms and conditions of this Agreement, including (without limitation) the limited time period during which this Option may, pursuant to Section II(2), be exercised following Optionee's death. 

        4.     Accelerated Vesting.      

        (a)   In the event of any Change in Control, the Option Shares at the time subject to this Option but not otherwise vested shall automatically vest in full so that this Option shall, immediately prior to the effective date of the Change in Control, become exercisable for all of the Option Shares as fully vested shares and may be exercised for any or all of those Option Shares as vested shares. 

        (b)   This Agreement shall not in any way affect the right of the Company 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. 

        5.     Tax Obligations: Withholding Taxes.     The Optionee agrees to make appropriate arrangements with the Company for the satisfaction of all Federal, state, local and foreign income and employment tax withholding requirements applicable to the Option exercise. The Optionee acknowledges and agrees that the Company may refuse to honor the exercise and refuse to deliver shares if such withholding amounts are not delivered at the time of exercise. 

        6.     Lock-Up Period.     The Optionee hereby agrees that the Optionee shall not offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any Common Stock (or other securities) of the Company (other than those included in or acquired after such registration) or enter into any swap, hedging or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Common Stock (or other securities) of the Company held by the Optionee (other than those included in the registration) for a period specified by the representative of the underwriters of Common Stock (or other securities) of the Company not to exceed one hundred eighty (180) days following the effective date of any registration statement of the Company filed under the Securities Act (or such longer period, not to exceed eighteen (18) days after expiration of the one hundred eighty (180) day period, as the Company or the underwriters shall request in order to facilitate compliance with NASD Rule 2711). 

        The Optionee agrees to execute and deliver such other agreements as may be reasonably requested by the Company or the underwriter which are consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative of the underwriters of Common Stock (or other securities) of the Company, the Optionee shall provide, within ten (10) days of such request, such information as may be required by the Company or such representative in connection with the completion of any public offering of the Company's securities pursuant to a registration statement filed under the Securities Act. The obligations described in this Section shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a Commission Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer instructions with respect to the shares of Common Stock (or other securities) subject to the foregoing restriction until the end of such lock-up period. The Optionee agrees that any transferee of the Option or shares acquired pursuant to the Option shall be bound by this Section. 

        8.     Restrictions on Exercise.     This Option may not be exercised if the issuance of shares upon exercise or the method of payment of consideration for such shares would constitute a violation of any Applicable Law. The inability of the Company to obtain approval from any regulatory body having authority deemed by the Company to be necessary to the lawful issuance and sale of any Common Stock 

54

pursuant to this Option shall relieve the Company of any liability with respect to the non-issuance or sale of the Common Stock as to which such approval has not been obtained. The Company, however, shall use its best efforts to obtain all such approvals. 

        9.     Term of Option.     If not earlier terminated pursuant to other provision of this Agreement, the Option will terminate on the Expiration Date and may not be exercised thereafter. 

        10.     At-Will Employment.     Nothing in this Agreement shall confer upon Optionee any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company or of Optionee, which rights are hereby expressly reserved by each, to terminate Optionee's Service at any time for any reason, with or without cause. 

        11.     Successors and Assigns.     The provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and Optionee, Optionee's assigns and the legal representatives, heirs and legatees of Optionee's estate. 

        12.     Notices.     Any notice required to be given or delivered to the Company under the terms of this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice required to be given or delivered to Optionee shall be in writing and addressed to Optionee at the address indicated below Optionee's signature line hereto. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified. 

        13.     Governing Law.     The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of Delaware without resort to that State's conflict-of-laws rules. 

        14.     Definition of Change in Control.     For purposes of this Agreement, a "Change in Control" shall mean the happening of any of the following events: 

        (a)   An acquisition by any individual, entity or "group" (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934) (a "Person") of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934) of 33 1 / 3 % or more of either (1) the then outstanding shares of common stock of the Company (the "Outstanding Company Common Stock") or (2) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the "Outstanding Company Voting Securities"); excluding, however, the following: (1) any acquisition directly from the Company, other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Company, (2) any acquisition by the Company, (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any entity controlled by the Company, (4) any acquisition pursuant to a transaction which complies with clauses (1), (2) and (3) of subsection (iii) of this Section II(14), or (5) any Change in Control triggered solely because the percentage of Outstanding Company Common Stock or Outstanding Company Voting Securities held by any Person (the "Subject Person") exceeds the designated percentage threshold thereof as a result of a repurchase or other acquisition of securities by the Company reducing the number of shares outstanding, provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of securities by the Company, and after such share acquisition, the Subject Person becomes the owner of any additional voting securities that, assuming the repurchase or other acquisition had not occurred, increases the percentage of the then outstanding voting securities owned by the Subject Person over the designated percentage threshold, then a Change in Control shall be deemed to occur; or 

        (b)   A change in the composition of the Board such that the individuals who, as of the date of this Agreement, constitute the Board (such Board shall be hereinafter referred to as the 

55

"Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, for purposes of this Section II(14)(b) that any individual who becomes a member of the Board subsequent to the date of this Agreement, whose election, or nomination for election by the Company's stockholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso) shall be considered as though such individual were a member of the Incumbent Board; but, provided, further, that any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board; or 

        (c)   Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company ("Corporate Transaction"); excluding, however, such a Corporate Transaction pursuant to which (1) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, more than 50% of, respectively, the outstanding shares of common stock, and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Corporate Transaction (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (2) no Person (other than the Company, any employee benefit plan (or related trust) of the Company or such corporation resulting from such Corporate Transaction) will beneficially own, directly or indirectly, 33?% or more of, respectively, the outstanding shares of common stock of the corporation resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of such corporation entitled to vote generally in the election of directors except to the extent that such ownership existed prior to the Corporate Transaction, and (3) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; or 

        (d)   The approval by the stockholders of the Company of a complete liquidation or dissolution of the Company, or a complete dissolution or liquidation of the Company shall otherwise occur. 

        (e)   The term Change in Control shall not include a sale of assets, merger or other transaction effected exclusively for the purpose of changing the domicile of the Company. 

        15.     Additional Definitions.     Definitions for this Agreement are as follows: 

        (a)   "Agreement" has the meaning set forth in the preface above. 

        (b)   "Applicable Law" means the requirements relating the issuance and exercise of stock options under federal and state corporate laws, federal and state securities laws, the Internal Revenue Code of 1986, as amended, any stock exchange or quotation system on which the Common Stock is listed or quoted and the applicable laws of any other country or jurisdiction where the Optionee resides at the time of exercise. 

56

        (c)   "Common Stock" means the Company's Common Stock, $.001 par value, and in the case of an option granted prior to January 3, 2006, the Class B Membership Units of the Company's predecessor that have been converted into the Company's Common Stock. 

        (d)   "Company" has the meaning set forth in the preface above. 

        (e)   "Change of Control" has the meaning set forth in Section II(14) above. 

        (f)    "Corporate Transaction" has the meaning set forth in Section II(14)(c) above. 

        (g)   "Disability" shall mean that the Optionee has been unable to perform his or her Company duties as the result of his or her incapacity due to physical or mental illness, and such inability, at least twenty-six (26) weeks after its commencement, is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Optionee or the Optionee's legal representative (such agreements to acceptability not to be unreasonably withheld).

        (h)   "Employee" means an individual who is in the employ of the Company, subject to the control and direction of the employer entity as to both the work to be performed and the manner and method of performance. 

        (i)    "Exercise Notice" has the meaning set forth in Section II(1)(c)(i) above. 

        (j)    "Exercise Price" has the meaning set forth in Section I(1) above. 

        (k)   "Expiration Date" has the meaning set forth in Section I(1) above. 

        (l)    "Incumbent Board" has the meaning set forth in Section II(14)(b) above. 

        (m)  "Misconduct" shall mean (i) the commission of any act of fraud, embezzlement or dishonesty by Optionee, (ii) any unauthorized use or disclosure by Optionee of confidential information or trade secrets of the Company, (iii) conviction of the Optionee for committing a felony under federal law or the law of the state in which such action occurred, (iv) illegal drug use or alcohol abuse on Company premises or at a Company sponsored event, (v) intentional, material violation by the Optionee of any contract between the employee and the Company or of any statutory duty of the Optionee to the Company, or (vi) any other intentional misconduct by Optionee adversely affecting the business or affairs of the Company in a material manner. The foregoing definition shall not be deemed to be inclusive of all the acts or omissions which the Company may consider as grounds for the dismissal or discharge of Optionee or any other individual in the Service of the Company. 

        (n)   "Option" has the meaning set forth in Section I(1) above. 

        (o)   "Optionee" has the meaning set forth in the preface above. 

        (p)   "Option Shares" or means the Shares subject to the Option. 

        (q)   "Outstanding Company Common Stock" has the meaning set forth in Section II(14)(a) above. 

        (r)   "Outstanding Company Voting Securities" has the meaning set forth in Section II(14)(a) above. 

57

        (s)   "Person" has the meaning set forth in Section II(14)(a) above. 

        (t)    "Service" or "Services" means the Optionee's performance of services for the Company in the capacity of an Employee, a non-employee member of the Board of Directors or a consultant or independent advisor. 

        (u)   "Subject Person" has the meaning set forth in Section II(14)(a) above. 

        (v)   "Vesting Commencement Date" has the meaning set forth in Section I(1) above. 

         IN WITNESS WHEREOF , the parties have executed this Agreement this ____  day of  __________________, 2006, to be effective as of the Effective Date. 

					
	OPTIONEE 

	  

	 
	

______________________________

	

  

	

__________________________

	

By: 

	

____________________________

	

  

	

By: 

	

_______________________

	

  

	

  

	

  

	

Its: 

	

________________________

	

_________________________________

	

  

	

  

	

  

	

_________________________________

Residence Address 

	

  

	

  

	

  

58

EXHIBIT A

NONSTATUTORY STOCK OPTION AGREEMENT 

EXERCISE NOTICE 

B2 Health, Inc.

Attention: Secretary 

        1.     Exercise of Option.     Effective as of today,  ________________, ___________________, the undersigned (the "Optionee") hereby elects to exercise the Optionee's option to purchase  ________ shares of the Common Stock (the "Shares") of B2 Health, Inc., (the "Company") under and pursuant to the Nonstatutory Stock Option Agreement dated  ___________, 2006 (the "Agreement"). 

        2.     Delivery of Payment.     The Optionee herewith delivers to the Company the full purchase price of the Shares, as set forth in the Agreement, and any and all withholding taxes due in connection with the exercise of the Option (as defined in the Agreement). 

        3.     Representations of Optionee.     The Optionee acknowledges that the Optionee has received, read and understood the Agreement and agrees to abide by and be bound by its terms and conditions. 

        4.     Rights as Stockholder.     Until the issuance of the Shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to shares not yet exercised. The Shares shall be issued to the Optionee as soon as practicable after the Option is exercised in accordance with the Agreement. 

        5.     Tax Consultation.     The Optionee understands that the Optionee may suffer adverse tax consequences as a result of the Optionee's purchase or disposition of the Shares. The Optionee represents that the Optionee has consulted with any tax consultants the Optionee deems advisable in connection with the purchase or disposition of the Shares and that the Optionee is not relying on the Company for any tax advice. 

        6.     Restrictive Legends and Stop-Transfer Orders.      

        (a)     Legends.     The Optionee understands and agrees that the Company shall cause the legends set forth below or legends substantially equivalent thereto, to be placed upon any certificate(s) evidencing ownership of the Shares together with any other legends that may be required by the Company or by state or federal securities laws: 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF COMPANY COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE THEREWITH. 

        (b)     Stop-Transfer Notices.     The Optionee agrees that, in order to ensure compliance with the restrictions referred to herein, the Company may issue appropriate "stop transfer" instructions to its transfer agent, if any, and that, if the Company transfers 

59

its own securities, it may make appropriate notations to the same effect in its own records. 

        (c)     Refusal to Transfer.     The Company shall not be required (i) to transfer on its books any Shares that have been sold or otherwise transferred in violation of any of the provisions of this Exercise Notice or (ii) to treat as owner of such Shares or to accord the right to vote or pay dividends to any purchaser or other transferee to whom such Shares shall have been so transferred. 

        7.     Successors and Assigns.     The Company may assign any of its rights under this Exercise Notice to single or multiple assignees, and this Exercise Notice shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Exercise Notice shall be binding upon the Optionee and his or her heirs, executors, administrators, successors and assigns. 

        8.     Governing Law; Severability.     This Exercise Notice is governed by and construed in accordance with the laws of the State of Colorado without resort to that State's conflict-of-laws rules. 

        9.     Entire Agreement.     The Agreement is incorporated herein by reference. This Exercise Notice, the Agreement and the Investment Representation Statement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and the Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee's interest except by means of a writing signed by the Company and the Optionee. 

			
	Submitted by: 

	  

	Accepted by: 

	

OPTIONEE 

	

  

	

B2 Health, Inc. 

	

_______________________________

Signature 

	

  

	

________________________________

By 

	

_______________________________

Print Name 

	

  

	

_______________________________

Title 

	

Address: 

	

  

	

 Date Received:  _____________________ 

	

________________________________

	

  

	 
	

________________________________

	

  

	 
	

  

	

  

	 

60

EXHIBIT B 

INVESTMENT REPRESENTATION STATEMENT 

			
	OPTIONEE: 

	  

	 _________________________________ 

	

COMPANY: 

	

  

	

B2 Health, Inc.

	

SECURITIES: 

	

  

	

COMMON STOCK 

	

AMOUNT: 

	

  

	

 ______________________

	

DATE: 

	

  

	

 _______________________

        In connection with the purchase of the above-listed Securities, the undersigned Optionee represents to the Company the following: 

        (a)   The Optionee is aware of the Company's business affairs and financial condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Securities. The Optionee is acquiring these Securities for investment for the Optionee's own account only and not with a view to, or for resale in connection with, any "distribution" thereof within the meaning of the Securities Act of 1933, as amended (the " Securities Act "). 

        (b)   The Optionee acknowledges and understands that the Securities constitute "restricted securities" under the Securities Act and have not been registered under the Securities Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the Optionee's investment intent as expressed herein. In this connection, the Optionee understands that, in the view of the Securities and Exchange Commission, the statutory basis for such exemption may be unavailable if the Optionee's representation was predicated solely upon a present intention to hold these Securities for the minimum capital gains period specified under tax statutes, for a deferred sale, for or until an increase or decrease in the market price of the Securities, or for a period of one year or any other fixed period in the future. The Optionee further understands that the Securities must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available. The Optionee further acknowledges and understands that the Company is under no obligation to register the Securities. The Optionee understands that the certificate evidencing the Securities will be imprinted with any legend required under applicable state securities laws. 

        (c)   The Optionee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under the Securities Act, which, in substance, permit limited public resale of "restricted securities" acquired, directly or indirectly, from the issuer thereof, in a non-public offering subject to the satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies under Rule 701 at the time of the grant of the Option to the Optionee, the exercise will be exempt from registration under the Securities Act. In the event the Company becomes subject to the reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days thereafter (or such longer period as any market stand-off agreement may require) the Securities exempt under Rule 701 may be resold, subject to the satisfaction of certain of the conditions specified by Rule 144, including: (1) the resale being made through a broker in an unsolicited "broker's transaction" or in transactions directly with a market maker (as said term is defined under the Securities Exchange Act of 1934); and, in the case of an affiliate, (2) the availability of certain public information about the Company, (3) the amount of Securities being sold during any three month 

61

period not exceeding the limitations specified in Rule 144(e), and (4) the timely filing of a Form 144, if applicable. 

        In the event that the Company does not qualify under Rule 701 at the time of grant of the Option, then the Securities may be resold in certain limited circumstances subject to the provisions of Rule 144, which requires the resale to occur not less than one year after the later of the date the Securities were sold by the Company or the date the Securities were sold by an affiliate of the Company, within the meaning of Rule 144; and, in the case of acquisition of the Securities by an affiliate, or by a non-affiliate who subsequently holds the Securities less than two years, the satisfaction of the conditions set forth in sections (1), (2), (3) and (4) of the paragraph immediately above. 

        (d)   The Optionee further understands that in the event all of the applicable requirements of Rule 701 or 144 are not satisfied, registration under the Securities Act, compliance with Regulation A, or some other registration exemption will be required; and that, notwithstanding the fact that Rules 144 and 701 are not exclusive, the Staff of the Securities and Exchange Commission has expressed its opinion that persons proposing to sell private placement securities other than in a registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden of proof in establishing that an exemption from registration is available for such offers or sales, and that such persons and their respective brokers who participate in such transactions do so at their own risk. The Optionee understands that no assurances can be given that any such other registration exemption will be available in such event. 

							
	  

	  

	Signature of Optionee: 

	

  

	

  

	

_________________________________

	

  

	

  

	

Date: 

	

_______________________

	

  

	

, 

	

62Development and Manufacturing Agreement

Development and Manufacturing Agreement

between

Back 2 Health and TDP, Inc .

This development and manufacturing Agreement is entered into as of February 20, 2007 by and between Technology Driven Products, Inc., a Colorado corporation (“TDP”) and Back 2 Health Ltd., a Colorado corporation (“Back 2 Health”).  

The parties hereby agree as follows: 

1.

Scope of Agreement

1.1

General.  This Agreement specifies the terms and conditions under which TDP agrees to provide design, manufacturing, order fulfillment and repair services for Products described in Exhibit A to this Agreement, and future products to be developed based on product requirements provided by Back 2 Health.

1.2

Back 2 Health General Obligations.  Without limiting any specific obligation specified in this Agreement, Back 2 Health will:

1.2.1

Provide the Product Requirements including but not limited to written product, test and packaging specifications in a timely manner.

1.2.2

Provide Requirement changes in accordance with the procedures specified in Article 3 of this Agreement.

1.2.3

Provide to TDP detailed drawings, descriptions or guidelines for any labeling requirements for Back 2 Health.

1.2.4

Provide approval or disapproval for any Engineering Change Orders necessary to improve the Products.

1.2.5

Provide other manufacturing information from time to time that Back 2 Health believes will assist TDP in manufacturing the Products.

1.3

TDP General Obligations.  Without limiting any specific obligation specified in this Agreement, TDP will:

1.3.1

Develop and maintain a manufacturing process and production line, purchase or procure tools, and source components and parts as needed to fulfill TDP’s obligations to manufacture the Products in accordance with the milestones specified in the Delivery Schedule, Exhibit B.

1.3.2

Manufacture, test, pack, ship and sell all manufactured Products in accordance with the terms of this Agreement.  

1.3.3

Apply its best efforts to continuously reduce its manufacturing costs including procurement and design opportunities.

1.3.4

Provide engineering support for changes as requested by Back 2 Health or identified by TDP.

1

1.3.5

Provide the warranty and repair services required under Article 9 of this Agreement.

1.4

Term of Agreement.  This Agreement will commence on February 1st, 2007 and continue for a three (3) year period (the “Term”), unless terminated earlier under the terms of this Agreement.  After the initial Term, this Agreement will continue automatically for two additional one year periods.  This Agreement may be terminated at the end of the initial Term or at the end of any subsequent renewal period if one party provides the other at least 90 days prior written notice of its intent to terminate.

2.

Definitions

The following capitalized terms will have these definitions for the purposes of this Agreement:

2.1

“Deliverables” mean the Prototypes, Products, Test Reports, Documentation and any other deliverable Back 2 Health requires TDP to develop or deliver under this Agreement.

2.2

“Delivery Date” means the date specified in an Order for the delivery of Back 2 Health Products by TDP to the destination required under the Order.

2.3

“Delivery Schedule” means the detailed schedule of milestones with corresponding delivery dates for the design, development and manufacture of the Deliverables, as specified in Exhibit B to this Agreement.

2.4

“Engineering Changes” means the implementation of the design changes and other Requirements provided by Back 2 Health or recommended by TDP that will be used to make improvements to the Product.

2.5

“Documentation” means the detail drawings, component specifications, BOM and other documentation used to manufacture the products that will be prepared in accordance with the terms of this Agreement and made available for use in connection with distribution of the Products.

2.6

“Forecast” means Back 2 Health’s estimate of its purchase requirements over a six month period, or such other period designated by the parties.

2.7

“Products” means each of the products described in Exhibit A to be manufactured by TDP based on the Requirements provided by Back 2 Health.

2.8

“Back 2 Health Property” means Back 2 Health equipment, materials and information, including Tools, provided to TDP by Back 2 Health or on Back 2 Health’s behalf or separately paid for by Back 2 Health for use by TDP in connection with this Agreement.

2.9

“Intellectual Property Rights” means all rights in patents, patent applications, copyrights, moral rights, trade secrets, marks and other similar rights.

2.10

“Lead Time” means the time between the date an Order is released to TDP and the Delivery Date of the product to Back 2 Health’s customer’s site.

2.11

“Marks” means the trademarks, service marks, trademark and service mark applications, trade dress, trade names, logos, insignia, symbols, designs or other marks identifying a party or its products.

2.12

“Non-complying Products” means any Back 2 Health Product received by Back 2 Health that does not comply with the Requirements or Specifications, or otherwise does not comply with the requirements of an Order or other provisions of this Agreement. Non-complying Products include non-functioning products.

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2.13

“Parts” means replacement parts, components, consumables or other products that may be supplied in conjunction with or as additions to the Products.

2.14

“Orders” means a written or electronic purchase order or release issued by Back 2 Health to TDP for purchase of the Products.

2.15

“Pre-Existing Intellectual Property” means any trade secret, invention, work of authorship, or protectable design that has been conceived or developed prior to performance of this Agreement. 

2.16

“Prototype” means the pre-production unit of a Product, packaged in a production package, and manufactured in accordance with the Requirements and Specifications with full test verification.

2.17

“Requirements” means the Back 2 Health-supplied design and technical information, drawings, concepts, schematics, software and other related material, which will be used by TDP in the manufacturing of the Products.

2.18

“Technical Assistance” means TDP-provided assistance, training and consultation whether technical in nature or otherwise relating to the manufacture, operation, use, testing, quality control and maintenance of the Products.

2.19

“Technical Product Information” means the product information used by TDP or third parties to design, develop, or test the Products including but not limited to: (i) specifications, software, schematics, designs, patterns, drawings or other materials pertinent to the most current revision level of manufacturing of the Products; (ii) jig, fixture and tooling designs owned by Back 2 Health; (iii) support documentation owned by Back 2 Health; (iv) any additional technical information or materials related to the product design listed in an escrow agreement agreed to by the parties or otherwise deemed necessary by Back 2 Health to exercise any rights provided under this Agreement.

2.20

“Technical Manufacturing Information” means the manufacturing information, process and technology used by TDP or third parties under its control to manufacture the Products including, but not limited to: (i) copies of all inspection, manufacturing, test and quality control procedures and any other work processes; (iii) jig, fixture and tooling designs owned by TDP;  (iv) TDP history files; (v) support documentation owned by TDP; and (vi) any additional technical information or materials related to the manufacturing of the Product listed in an escrow agreement agreed to by the parties or otherwise deemed necessary by TDP to exercise any rights provided under this Agreement.

2.21

“Test Reports” means the documentation prepared by TDP that includes records of tests conducted and results obtained with respect to both hardware and software components of the Prototypes.

2.22

“Tools” means any tooling, dies, jigs or fixtures or other property either built or acquired by TDP in connection with its performance of this Agreement.

3.

Statement of Work

3.1

Engineering Changes Proposed by Back 2 Health

Upon requests by Back 2 Health for engineering changes (provided in written description form):

3.1.1

TDP will evaluate proposed engineering changes for feasibility and cost.  Such evaluation will state the costs and time of implementation and the impact on the delivery schedule and pricing of the Product.  TDP will not be obligated to proceed with the engineering change until the parties have agreed upon the changes to the Product’s Specifications, delivery schedule and Product pricing and upon the implementation costs to be borne by Back 2 Health including, 

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without limitation, the cost of inventory and special inventory on-hand and on-order that becomes obsolete.

3.1.2

TDP will provide a quote for estimated engineering services and costs for materials and/or tooling including a Gantt Chart outlining the schedule for completion of such changes. 

3.1.3

Back 2 Health will issue separate Purchase Orders for Engineering Services, inventory obsolescence, or incurred manufacturing costs as a result of authorized changes.

3.2

Engineering Changes Proposed by TDP

TDP may make recommendations that would reduce material costs and/or improve quality/reliability.  

Upon TDP’s recommendations:

3.2.1

Back 2 Health will evaluate such recommendations and TDP will provide a quote for estimated engineering services to incorporate such recommendations into the Product as appropriate.   Back 2 Health and TDP may negotiate the terms for engineering services including but not limited to sharing the cost savings as a result of the engineering changes.  TDP will not make changes to product design or manufacturing processes which affect the form, fit, and function or reliability of the Product without prior written authorization from Back 2 Health.

3.2.2

Once design changes have been implemented, Back 2 Health must provide field testing data with their signed approval.

3.2.3

If design changes affect TDP’s ability to meet the Delivery Schedule based on existing purchase orders, TDP and Back 2 Health must mutually agree upon the schedule change and this must be followed by a revised purchase order.

3.3

New Product Development

Back 2 Health may retain the engineering services of TDP to develop new products.  Upon requests for engineering services for new product development:

3.3.1

Back 2 Health will provide TDP with a product specification in written form.  Prior to commencing engineering activities for new product development, both parties will approve the product specification in writing.  

3.3.2

TDP will provide an estimate for development services based on the product specification including costs and schedule in written form.

3.3.3

All new products will include an initial concept phase, prototype phase and engineering phase with Back 2 Health providing field testing and written authorization for release to manufacturing.

3.4

Production Units.

TDP will conduct a Manufacturing Release for the Back 2 Health products and upon Back 2 Health’s written authorization to begin production:

3.4.1

TDP will provide to Back 2 Health a first article production unit for written sign off and approval prior to the subsequent building of production quantities.  

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3.4.2

Back 2 Health will provide TDP written notice of its approval or disapproval of the first article unit for each Back 2 Health Product within 15 days after Back 2 Health’s receipt of all the items required to be delivered to Back 2 Health pursuant to this Section.  

3.4.3

If the first article production unit for a Back 2 Health Product is disapproved by Back 2 Health, TDP will remedy the reasons for Back 2 Health’s disapproval in a timely fashion consistent with milestones specified in the Delivery Schedule.

3.4.4

Subject to Back 2 Health approval of the first article production unit, TDP will release the Back 2 Health Product to production.

3.5

Repair Services. 

TDP will provide repair services to Back 2 Health for both warranty and non-warranty repairs.  All warranty repairs will be processed in accordance with Articles 9.2 and 9.3.  However, non-warranty repairs will be processed as follows:

3.5.1

All non-warranty repairs will be processed pursuant to the TDP RMA process using the form attached as Exhibit D and the accompanying instructions.  TDP will charge a pre-determined evaluation fee for non-warranty units.  Upon authorization from Back 2 Health to repair the product, the pre-determined fee will be applied toward the actual repair cost.

3.5.2

An estimate of repairs will be submitted to Back 2 Health via e-mail. E-mail authorization from Back 2 Health is required prior to any repairs being completed by TDP.  Back 2 Health will be notified that a repaired unit is completed and ready for shipment to Back 2 Health’s customer.

3.5.3

Payment terms for repairs will be the same as stated in Article 8.

4.

Ownership

4.1

General. Each party will maintain all right, title and interest in Pre-Existing Intellectual Property, subject to any licenses granted in this Agreement.  Except as otherwise provided in Section 4.2 below, ownership of Intellectual Property Rights in any intellectual property developed under this Agreement will be owned by the party or parties whose employees, agents or contractors conceive and either first reduce to practice, author or otherwise create such intellectual property. Neither party will have any duty to account to the other for profits with respect to property jointly owned under this Agreement, and TDP and Back 2 Health will mutually agree on whether and how to pursue patent protection for any such joint inventions.

4.2

Back 2 Health Rights. 

4.2.1

Subject to TDP’s rights specified in Section 4.3.1 below, Back 2 Health will own all right, title and interest, including all Intellectual Property Rights, in and to the Requirements and the Deliverables including the Technical Product Information.  TDP agrees to assign to Back 2 Health any Intellectual Property Rights it may have in the Deliverables. 

4.2.2

During the Term plus any period of support that may survive termination of this Agreement, TDP agrees to inform Back 2 Health promptly of any new processes, inventions, discoveries, technologies, or materials developed in connection with its performance under this Agreement (collectively, “Developments”).  Back 2 Health will own all Intellectual Property Rights in Developments that are the result of product changes paid for and owned by Back 2 Health.  TDP will execute any necessary documents and will otherwise assist Back 2 Health, at Back 2 Health’s expense, as reasonably requested, to protect such Intellectual Property Rights. 

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4.3

TDP Rights. 

4.3.1

TDP will retain all right, title and interest, including all Intellectual Property Rights, in and to product or manufacturing process improvements made at TDP’s expense and TDP’s Technical Manufacturing Information for the Products, subject to Back 2 Health’s rights in Developments under Section 4.2.2 above. Any Technical Manufacturing Information developed for the purpose of manufacturing Back 2 Health Products will be used solely for the design, development, testing and manufacturing of such products, which may only be sold to Back 2 Health.  Back 2 Health agrees to maintain the confidentiality of TDP’s Technical Manufacturing Information under the terms specified in Article 13 below.

4.3.2

Back 2 Health grants to TDP, under Back 2 Health’s Intellectual Property Rights, a non-exclusive, non-transferable, worldwide, royalty-free license to use the Requirements to design, develop, test and manufacture the Deliverables for the term of this Agreement.  TDP agrees to maintain the confidentiality of the Requirements under the terms specified in Article 13 below.

4.4

Trademark Usage.  Nothing in this Agreement implies the grant of any license from one party to the other to use any Marks.  Notwithstanding the foregoing, Back 2 Health grants to TDP the non-exclusive, limited right to reproduce any designated Back 2 Health Marks on Back 2 Health Products.  

5.

Tooling, Non-Recurring Expenses, Software

5.1

Tooling and Non-Recurring Expenses.  TDP shall provide non-Product specific tooling at its expense.  Back 2 Health shall pay for or obtain and consign to TDP any Product specific tooling or equipment and other reasonably necessary non-recurring expenses, to be set forth in TDP’s quotation.  

5.2

Software.  Any software or firmware provided to TDP by Back 2 Health is licensed to TDP non-exclusively for use solely to perform its obligations under this Agreement.  Such software and firmware may not be transferred or sublicensed and may not be disassembled or decompiled without Back 2 Health’s express written consent.  

6.

Forecasts, Orders, Material Procurement

6.1

Forecast.  Back 2 Health shall provide TDP, on a monthly basis, a non-binding, rolling twelve (12) month forecast of its projected orders.  

6.2

Purchase Orders.  Back 2 Health will issue a written Purchase Order to cover a minimum of 6 months rolling time period with a 100 unit minimum.   

6.3

Order Acknowledgement.  Purchase orders shall normally be deemed accepted by TDP, provided however that TDP may reject any order that does not conform to the lead-time, flexibility or cancellation terms of this Agreement.  TDP shall notify Back 2 Health of rejection of any purchase order within five (5) working days of receipt of such order.

6.4

Material Procurement.  Purchase Orders issued by Back 2 Health in conformance to this Agreement will constitute authorization for TDP to procure, using standard purchasing practices, the components, subassemblies, materials and supplies necessary for the manufacture of Products (“Inventory”) covered by such Purchase Orders.

6.5

Long Lead Time Components.  As Back 2 Health’s strategic materials management partner, TDP may be required to purchase Long Lead Time Components in order to achieve the schedule flexibility requirements identified in Section 7.3.  For purposes of this Agreement, “Long Lead Time Components” shall mean components, subassemblies, materials and supplies with lead times greater than forty (40) days.  During the term of this Agreement, if any lead times for components, subassemblies, materials or supplies exceed forty (40) days due to changes in market conditions, TDP may reasonably 

6

purchase minimum lot sizes from suppliers (“Minimum Order Inventory”), even if greater than the amount necessary to meet purchase orders, in order to ensure the schedule flexibility requirements identified in Section 7.3 are achieved.  TDP will notify Back 2 Health quarterly in writing if lead times for any components, subassemblies, materials or supplies exceed forty (40) days and will quantify how much additional cancellation liability Back 2 Health will incur above and beyond the cancellation liability terms defined in Section 7.3.  If lead times for components, subassemblies, materials or supplies do not exceed ninety (90) days during the term of this Agreement, or any extensions thereof, TDP and Back 2 Health agree to abide by the reschedule flexibility and cancellation liability terms defined in Section 7.3.

7.

Shipments, Schedule Changes, Cancellation

7.1

Shipment Requirements.  All Products delivered pursuant to the terms of this Agreement shall be suitably packed for shipment in accordance with Back 2 Health’s Specifications, marked for shipment to Back 2 Health’s destination specified in the applicable purchase order and delivered to a carrier or forwarding agent.  Shipment will be F.O.B. TDP’s Loveland manufacturing facility at which time risk of loss and title will pass to Back 2 Health.  All freight, insurance and other shipping expenses from the F.O.B. point, will be paid by Back 2 Health.

7.2

Meeting Delivery Dates.  TDP will make best effort to achieve 100% on-time delivery performance to the designated F.O.B. point.  “On-time” delivery is defined as within 2 days early and 2 days late of scheduled delivery date on purchase orders placed by Back 2 Health in accordance to this Agreement.  If due to TDP’s failure to make a timely shipment, the specified method of transportation would not permit TDP to meet the Delivery Date, the Products affected will be shipped by air transportation or other expedient means acceptable to Back 2 Health.  TDP will pay for any resulting increase in the freight cost over that which Back 2 Health would have been required to pay by the specified method of transportation.

7.3

Quantity Increases and Shipment Schedule Changes.  Back 2 Health may postpone, decrease, increase or cancel any Order by notice to TDP at any time prior to the Delivery Date.  If Back 2 Health postpones, decreases, or cancels an Order after TDP has accepted the order and commenced production (including parts procurement) TDP will be entitled to be reimbursed by Back 2 Health for actual costs including labor incurred by TDP as a direct result of such postponement, decrease or cancellation that are not recoverable by the shipment of the affected Products or associated raw materials to other purchasers.

8.

Prices And Payment Terms

8.1

Back 2 Health Product Prices.  The price for Products to be manufactured is set forth in Exhibit C and may be changed from time to time through purchase orders issued by Back 2 Health and accepted by TDP.  All pricing changes must be mutually agreed to by both parties.  TDP and Back 2 Health agree to review Back 2 Health Product prices quarterly and adjusted if appropriate and agreed upon by both parties.

8.2

Payment Procedure.  Invoices will be e-mailed in the form of a pdf file.  Payment for Back 2 Health Products will be paid due upon receipt until such time as TDP receives a credit application and approves Back 2 Health for net 30 day terms.  Payments for invoices will be in the form of company check based on Products completed in finished goods at TDP the prior week.  Except as otherwise provided in this Agreement, associated freight expenses and duties will be paid directly by Back 2 Health.  Back 2 Health will not be liable for any costs related to or payments for unordered or Nonconforming Products.

8.3

Sales Taxes And Duties.  Prices are exclusive of all taxes or duties after delivery to the designated destination (other than taxes levied on TDP’s income) that TDP may be required to collect or pay upon shipment of the Back 2 Health Products.  Any such taxes or duties must appear as a separate item on TDP’s invoice.  Back 2 Health agrees to pay such taxes or duties unless Back 2 Health is exempt from such taxes or duties.  Where applicable, Back 2 Health will provide TDP with an exemption resale certificate.

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8.4

Additional Costs.  Back 2 Health is responsible for (a) any expediting charges reasonably necessary because of a change in Back 2 Health’s Requirements, if such changes do not conform to established flexibility terms defined in Section 7 which charges are pre-approved (b) any reasonable overtime or downtime charges incurred as a result of delays in the normal production or interruption in the workflow process and caused by: (1) Back 2 Health’s change in the Specifications; or (2) Back 2 Health’s failure to provide sufficient quantities or a reasonable quality level of consigned materials where applicable to sustain the production schedule.  Back 2 Health caused delays as a result of consigned inventory will result in a special charge to Back 2 Health of 1% of the cost of the delayed materials.

9.

Product Acceptance and Warranties.

9.1

Product Acceptance.  Back 2 Health agrees that the product is deemed acceptable if Back 2 Health has not rejected the product within thirty (30) days after receipt by Back 2 Health.

9.2

Non-Complying Product.   TDP is expected to deliver 100% quality Product in conformance to all Products’ specifications, workmanship standards and quality requirements.  As Back 2 Health’s strategic quality partner, TDP is expected to institute appropriate quality controls at the factory to stop any defective product from shipping to Back 2 Health.  Back 2 Health’s intent is not to inspect each shipment coming from TDP, however, Back 2 Health reserves the right to audit TDP’s facilities and conduct source inspection. Back 2 Health and TDP will work together to jointly determine if Product is defective.  Back 2 Health may return defective Products (within 30 days of receipt), freight collect, after obtaining a return material authorization number (RMA#) from TDP to be displayed on the shipping container and completing the RMA form, Exhibit D provided by TDP.  TDP will not unreasonably withhold such return material authorization numbers.  Rejected Products will be promptly repaired and replaced, at TDP’s option, and returned freight pre-paid.

9.3

Express Limited Warranty.  TDP warrants that the Products will conform to Back 2 Health’s applicable Specifications and will be free from defects in workmanship for a period of 90 days.  Materials are warranted to the same extent that the original manufacturer warrants the materials.  This express limited warranty does not apply to (a) materials consigned or supplied by Back 2 Health to TDP; (b) defects resulting from Back 2 Health’s design of the Product; (c) Product that has been abused, damaged, altered or misused by any person or entity after title passes to Back 2 Health.  With respect to first articles, prototypes, pre-production units, test units or other similar products, TDP makes no representations or warranties whatsoever.  Notwithstanding anything else in this Agreement, TDP assumes no liability for or obligation related to the performance, accuracy, specifications, failure to meet specifications or defects of or due to tooling, designs or instructions produced or supplied by Back 2 Health and Back 2 Health shall be liable for costs or expenses incurred by TDP related thereto.  Upon any failure of a Product to comply with the above warranty, TDP’s sole obligation, and Back 2 Health’s sole remedy, is for TDP, at its option, to promptly repair or replace such unit and is limited to the purchase price of the product and return it to Back 2 Health freight pre-paid.  TDP will bear all costs of repairing defective Product within warranty.  Back 2 Health shall return Products covered by the warranty freight pre-paid after completing a failure report and obtaining a return material authorization number (RMA#) from TDP to be displayed on the shipping container.

TDP MAKES NO OTHER WARRANTIES OR CONDITIONS ON THE PRODUCTS, EXPRESS, IMPLIED, STATUTORY, OR IN ANY OTHER PROVISION OF THIS AGREEMENT OR COMMUNICATION WITH BACK 2 HEALTH, AND TDP SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTY OR CONDITION OR MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

10.

Termination

10.1

If either party fails to meet any one or more of the terms and conditions as stated in this Agreement, TDP and Back 2 Health agree to negotiate in good faith to resolve such default. If the defaulting party fails to cure such default or submit an acceptable written plan to resolve such default 

8

within thirty (30) days following notice of default, the non-defaulting party shall have the right to terminate this Agreement by furnishing the defaulting party with thirty (30) days written notice of termination.

10.2

This Agreement shall immediately terminate should either party; (i) become insolvent; (ii) enter into or file a petition, arraignment or proceeding seeking an order for relief under the bankruptcy laws of its respective jurisdiction; (iii) enter into a receivership of any of its assets; or (iv) enter into a dissolution of liquidation of its assets or an assignment for the benefit of its creditors.

10.3

Either TDP or Back 2 Health may terminate this Agreement without cause by giving ninety (90) days advance written notice to the other party.  In the event of termination without cause, TDP will continue shipment of all orders accepted prior to the date of notice and Back 2 Health will remain obligated to accept and pay for such deliveries at the current pricing.

10.4

Subject to the terms and conditions of this Agreement, upon termination of this Agreement Back 2 Health agrees to reimburse TDP for all inventory purchased or manufactured and all charges or costs including labor  for which TDP may be liable or which TDP may have reasonably incurred in the course of performance of this Agreement. 

11.

Liability Limitation

11.1

Patents, Copyrights, Trade Secrets, Other Proprietary Rights.  Back 2 Health shall defend, indemnify and hold harmless TDP from all costs, judgments and attorney’s fees arising from any claim that TDP’s manufacture of the Products under this Agreement directly infringes any third party patents, patent rights, copyrights or trade secrets.  TDP shall promptly notify Back 2 Health in writing of the initiation of any such claims, give Back 2 Health sole control of any defense or settlement, and provide Back 2 Health reasonable information and assistance in resolving such claim.  The preceding indemnity shall not apply, however, to any claims arising from the use by TDP of any materials, components or manufacturing processes not expressly specified by Back 2 Health.

THE FOREGOING STATES THE ENTIRE LIABILITY OF BACK 2 HEALTH CONCERNING INFRINGEMENT OF PATENT, COPYRIGHT, TRADE SECRET OR OTHER INTELLECTUAL PROPERTY RIGHTS.

11.2

Product Liability.  Back 2 Health agrees that, if notified promptly in writing and given sole control of the defense and all related settlement negotiations, it will defend TDP from any claim or action and will hold TDP harmless from any third party loss, damage or injury, including death, which arises from any alleged defect of Back 2 Health’s design of any Products.  Similarly, TDP agrees that, if notified promptly in writing and given sole control of the defense and all related settlement negotiations, it will defend Back 2 Health from any claim or action and will hold Back 2 Health harmless from any third party loss, damage, or injury, including death, which arises from any alleged workmanship defect of any Products.  As the Back 2 Health product does not have NRTL certification, TDP will not be responsible for any action related to the lack of this certification.

11.3

NO OTHER LIABILITY.  EXCEPT FOR THE EXPRESS WARRANTIES CREATED UNDER THIS AGREEMENT AND EXCEPT AS SET FORTH OTHERWISE IN THIS AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES OF ANY KIND OR NATURE ARISING OUT OF THIS AGREEMENT OR THE SALE OF PRODUCTS, WHETHER SUCH LIABILITY IS ASSERTED ON THE BASIS OF CONTRACT, TORT (INCLUDING THE POSSIBILITY OF NEGLIGENCE OR STRICT LIABILITY), OR OTHERWISE, EVEN IF THE PARTY HAS BEEN WARNED OF THE POSSIBILITY OF ANY SUCH LOSS OR DAMAGE, AND EVEN IF ANY OF THE LIMITED REMEDIES IN THIS AGREEMENT FAIL OF THEIR ESSENTIAL PURPOSE.

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12.

Force Majeure 

12.1

If the event that either party is prevented from performing or is unable to perform any of its obligations under this Agreement (other than a payment obligation) due to any Act of God, fire, casualty, flood, earthquake, war, strike, lockout, epidemic, destruction of production facilities, riot, insurrection, material unavailability, or any other cause beyond the reasonable  control of the party invoking this section, and if such party shall have used its commercially reasonable efforts to mitigate its effects, such party shall give prompt written notice to the other party, its performance shall be excused, and the time for the performance shall be extended for the period of delay or inability to perform due to such occurrences.  Regardless of the excuse of Force Majeure, if such party is not able to perform within ninety (90) days after such event, the other party may terminate the Agreement.  Termination of this Agreement shall not affect the obligations of either party which exist as of the date of termination.

13.

Miscellaneous

13.1

Confidential Information.  In connection with the performance of this Agreement, the parties may exchange confidential information, during the term of the Agreement.  All confidential information (and all rights therein, including but not limited to trade secrets) shall remain the property of the disclosing party. These obligations shall not apply to information which is (i) publicly known at the time of disclosure or becomes known through no fault of the recipient, (ii) known to recipient at the time of disclosure through no wrongful act, (iii) received by recipient from a third party without restrictions similar to those in this section or (iv) independently developed by recipient.  Neither party may transfer or disclose confidential information or assign their rights or obligations under this section without prior written consent of the disclosing party.  Upon termination of this Agreement all confidential information whether in paper or electronic form, shall be collected and returned to the disclosing party.

13.2

Independent Contractors.  Neither party shall, for any purpose, be deemed to be an agent of the other party and the relationship between the parties shall only be that of independent contractors.  Neither party shall have any right or authority to assume to create any obligations or to make any representations or warranties on behalf of any other party, whether express or implied, or to bind the other party in any respect whatsoever.

13.3

Successors, Assignment.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors, assignees and legal representatives.  Neither party shall have the right to assign or otherwise transfer its rights or obligations under this Agreement except with the prior written consent of the other party, not to be unreasonably withheld.

13.4

Entire Agreement.  This Agreement constitutes the entire agreement between the Parties with respect to the transactions contemplated hereby and supersedes all prior agreements and understandings between the parties relating to such transactions.  Both parties shall hold the existence and terms of this Agreement confidential, unless it obtains the other party’s express written consent otherwise.  In all respects, this Agreement shall govern, and any other documents including, without limitation, preprinted terms and conditions on Back 2 Health’s purchase orders and TDP’s acknowledgements shall be of no effect.

13.5

Attorney’s Fees.  In the event of a default under this Agreement, the defaulting party shall pay the reasonable attorney’s fees and court costs incurred by the non-defaulting party in enforcing this agreement.

13.6

Amendments.

This Amendment may be amended only by written consent of both parties.

13.7

Governing Law.  This Agreement will be governed in all respects by the laws of Colorado without reference to any choice of laws provisions. 

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AGREED AND APPROVED:

TDP, Inc.

BACK 2 HEALTH

 

By: /s/ Terry Precht                          

By: /s/ John B. Quam              

Name: Terry Precht                          

Name: John B. Quam              

Title: President                                

Title: President                        

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EXHIBIT D

RETURN MATERIAL AUTHORIZATION FORM

Date:__________

RMA#_______________________

Item Being Returned:________________

Serial Number: _______________

Invoice Date to End User ____________

Customer:

  ______________________ 

 Phone Number: ________________

Department: ______________________      FAX Number:     _______________

Address:

______________________

  ______________________

City:

  ______________________

State:

  ______________________

Postal Code:     ______________________

Country:

  ______________________

Request for Repair: 

(A complete description of the problem is essential for accurate diagnoses of your product.)

PACKING GUIDELINES FOR RETURNING PRODUCTS

Follow these packing instructions if sending the product for repair service.

·

Use the original shipping container(s) and packing materials, if available.

·

Return to the repair address listed below:

Attn: Repairs – RMA # _______________

TDP, Inc

 

4015 S. Lincoln Ave., Ste. 560

        Loveland, CO  80537

Note: Damage incurred due to improper transportation or packaging is not covered under the warranty

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