Document:

exhibit_10-14.htm

    Exhibit
10.14

     

     

     

     

     

    nFinanSe Inc. 

     

    (f/k/a Morgan Beaumont,
Inc.)

     

    2007 OMNIBUS EQUITY COMPENSATION
PLAN

     

     

     

     

     

     

     

     

     

     

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    nFinanSe
Inc.

     

    2007 OMNIBUS EQUITY
COMPENSATION PLAN

     

    The
purpose of the nFinanSe Inc. 2007 Omnibus Equity Compensation Plan (the “Plan”)
is to provide (i) employees of nFinanSe
Inc., f/k/a Morgan Beaumont, Inc., (the “Company”) and its subsidiaries, (ii)
certain consultants and advisors who perform services for the Company or its
subsidiaries and (iii) non-employee members of the Board of Directors of the
Company with the opportunity to receive grants of incentive stock options,
nonqualified stock options, stock appreciation rights, stock awards, stock units
and other stock-based awards. The Company believes that the Plan will encourage
the participants to contribute materially to the growth of the Company, thereby
benefitting the Company’s stockholders, and will align the economic interests of
the participants with those of the stockholders. The Plan shall be effective as
of March 1, 2007, subject to approval by the stockholders of the Company.

     

    The
Morgan Beaumont, Inc. 2004 Amended
Stock Incentive Plan (“2004
Plan”) will be merged with and into this Plan as of the Effective Date, and no
additional grants will be made thereafter under the 2004 Plan. Outstanding
grants under the 2004 Plan will continue in effect according to their terms as
in effect before the Plan merger (subject to such amendments as the Committee
(as defined below) determines, consistent with the 2004 Plan, as applicable),
and the shares with respect to outstanding grants under the 2004 Plan will be
issued or transferred under this Plan.

     

    Section 1.  Definitions

     

    The
following terms shall have the meanings set forth below for purposes of the
Plan:

     

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

     

    (b)  “Cause”
shall mean, except to the extent specified otherwise by the Committee, a finding
by the Committee that the Grantee (i) has breached his or her employment or
service contract with the Employer, (ii) has engaged in disloyalty to the
Employer, including, without limitation, fraud, embezzlement, theft, commission
of a felony or proven dishonesty, (iii) has disclosed trade secrets or
confidential information of the Employer to persons not entitled to receive such
information, (iv) has breached any written non-competition, non-solicitation or
confidentiality agreement between the Grantee and the Employer or (v) has
engaged in such other behavior detrimental to the interests of the Employer as
the Committee determines.

     

    (c)  “Change
of Control” shall be deemed to have occurred if:

     

    (i)  Any
“person” (as such term is used in sections 13(d) and 14(d) of the Exchange Act)
becomes a “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing more than 50%
of the voting power of the then outstanding securities of the Company; provided
that a Change of 

     

    
      
        
        

      

      
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    Control
shall not be deemed to occur as a result of a transaction in which the Company
becomes a subsidiary of another corporation and in which the stockholders of the
Company, immediately prior to the transaction, will beneficially own,
immediately after the transaction, shares entitling such stockholders to more
than 50% of all votes to which all stockholders of the parent corporation would
be entitled in the election of directors.

     

    (ii)  The
consummation of (A) a merger or consolidation of the Company with another
corporation where the stockholders of the Company, immediately prior to the
merger or consolidation, will not beneficially own, immediately after the merger
or consolidation, shares entitling such stockholders to more than 50% of all
votes to which all stockholders of the surviving corporation would be entitled
in the election of directors, or where the members of the Board, immediately
prior to the merger or consolidation, would not, immediately after the merger or
consolidation, constitute a majority of the board of directors of the surviving
corporation, (B) a sale or other disposition of all or substantially all of the
assets of the Company, or (C) a liquidation or dissolution of the
Company.

     

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

     

    (e)  “Committee”
shall mean the committee, consisting of members of the Board, designated by the
Board to administer the Plan.

     

    (f)  “Company”
shall mean nFinanSe Inc. and shall include its successors.

     

    (g)  “Company
Stock” shall mean common stock of the Company.

     

    (h)  “Disability”
or “Disabled” shall mean a Grantee’s becoming disabled within the meaning of
section 22(e)(3) of the Code, within the meaning of the Employer’s long-term
disability plan applicable to the Grantee or as otherwise determined by the
Committee.

     

    (i)  “Dividend
Equivalent” shall mean an amount determined by multiplying the number of shares
of Company Stock subject to a Grant by the per-share cash dividend paid by the
Company on its outstanding Company Stock, or the per-share fair market value (as
determined by the Committee) of any dividend paid on its outstanding Company
Stock in consideration other than cash.

     

    (j)  “Effective
Date” shall mean March 1, 2007, subject to stockholder approval of the
Plan.

     

    (k)  “Employee”
shall mean an employee of the Company or a subsidiary of the
Company.

     

    (l)  “Employed
by, or providing service to, the Employer” shall mean employment or service as
an Employee, Key Advisor or member of the Board (so that, for purposes of
exercising Options and SARs and satisfying conditions with respect to Stock
Awards and Performance Units, a Grantee shall not be considered to have
terminated employment or 

     

    
      
        
        

      

      
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    service
until the Grantee ceases to be both an Employee, Key Advisor and member of the
Board).

     

    (m)  “Employer”
shall mean the Company and each of its subsidiaries.

     

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

     

    (o)  “Exercise
Price” shall mean the purchase price of Company Stock subject to an
Option.

     

    (p)  “Fair
Market Value” shall mean:

     

    (i)  If the
Company Stock is publicly traded, then the Fair Market Value per share shall be
determined as follows: (A) if the principal trading market for the Company Stock
is a national securities exchange or Nasdaq, the last reported sale price
thereof on the relevant date or (if there were no trades on that date) the
latest preceding date upon which a sale was reported, or (B) if the Company
Stock is not principally traded on any such exchange or on Nasdaq, the last
reported sale price of a share of Company Stock on the relevant date, as
reported by the OTC Bulletin Board or, if shares are not reported on the OTC
Bulletin Board, as determined by the Committee through any reasonable valuation
method authorized under the Code. 

     

    (ii)  If the
Company Stock is not publicly traded or, if publicly traded, is not subject to
reported transactions as set forth above, the Fair Market Value per share shall
be as determined by the Committee through any reasonable valuation method
authorized under the Code.

     

    (q)  “Grant”
shall mean a grant of Options, SARs, Stock Awards, Stock Units or Other
Stock-Based Awards under the Plan.

     

    (r)  “Grant
Instrument” shall mean the agreement that sets forth the terms of a Grant,
including any amendments.

     

    (s)  “Grantee”
shall mean an Employee, Key Advisor or Non-Employee Director who receives a
Grant under the Plan.

     

    (t)  “Incentive
Stock Option” shall mean an option to purchase Company Stock that is intended to
meet the requirements of section 422 of the Code.

     

    (u)  “Key
Advisor” shall mean a consultant or advisor of an Employer. 

     

    (v)  “Non-Employee
Director” shall mean a member of the Board who is not an Employee.

     

    
      
        
        

      

      
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    (w)  “Nonqualified
Stock Option” shall mean an option to purchase Company Stock that is not
intended to meet the requirements of section 422 of the Code.

     

    (x)  “Option”
shall mean an Incentive Stock Option or Nonqualified Stock Option granted under
the Plan.

     

    (y)  “Other
Stock-Based Award” shall mean any Grant based on, measured by or payable in
Company Stock, as described in Section 10.

     

    (z)  “SAR”
shall mean a stock appreciation right with respect to a share of Company
Stock.

     

    (aa)  “Stock
Award” shall mean an award of Company Stock, with or without
restrictions.

     

    (bb)  “Stock
Unit” shall mean a unit that represents a hypothetical share of Company
Stock.

     

    Section 2.  Administration

     

    (a)  Committee. The
Plan shall be administered and interpreted by the Board or by a Committee
appointed by the Board. The Committee, if applicable, should consist of two or
more persons who are “outside directors” as defined under section 162(m) of the
Code, and related Treasury regulations, and “non-employee directors” as defined
under Rule 16b-3 under the Exchange Act. The Board shall approve and administer
all grants made to Non-Employee Directors. The Committee may delegate authority
to one or more subcommittees, as it deems appropriate. To the extent that the
Board or a subcommittee administers the Plan, references in the Plan to the
“Committee” shall be deemed to refer to the Board or such subcommittee. In the
absence of a specific designation by the Board to the contrary, the Plan shall
be administered by the Committee of the Board or any successor Board committee
performing substantially the same functions.

     

    (b)  Committee
Authority. The
Committee shall have the sole authority to (i) determine the individuals to whom
grants shall be made under the Plan, (ii) determine the type, size and terms of
the grants to be made to each such individual, (iii) determine the time when the
grants will be made and the duration of any applicable exercise or restriction
period, including the criteria for exercisability and the acceleration of
exercisability, (iv) amend the terms of any previously issued grant, subject to
the provisions of Section 18 below, and (v) deal with any other matters arising
under the Plan.

     

    
      
        
        

      

      
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    (c)  Committee
Determinations. The
Committee shall have full power and express discretionary authority to
administer and interpret the Plan, to make factual determinations and to adopt
or amend such rules, regulations, agreements and instruments for implementing
the Plan and for the conduct of its business as it deems necessary or advisable,
in its sole discretion. The Committee’s interpretations of the Plan and all
determinations made by the Committee pursuant to the powers vested in it
hereunder shall be conclusive and binding on all persons having any interest in
the Plan or in any awards granted hereunder. All powers of the Committee shall
be executed in its sole discretion, in the best interest of the Company, not as
a fiduciary, and in keeping with the objectives of the Plan and need not be
uniform as to similarly situated individuals.

     

    Section 3.  Grants

     

    Awards
under the Plan may consist of grants of Options as described in Section 6, Stock
Awards as described in Section 7, Stock Units as described in Section 8, SARs as
described in Section 9 and Other Stock-Based Awards as described in Section 10.
All Grants shall be subject to the terms and conditions set forth herein and to
such other terms and conditions consistent with this Plan as the Committee deems
appropriate and as are specified in writing by the Committee to the individual
in the Grant Instrument. All Grants shall be made conditional upon the Grantee’s
acknowledgement, in writing or by acceptance of the Grant, that all decisions
and determinations of the Committee shall be final and binding on the Grantee,
his or her beneficiaries and any other person having or claiming an interest
under such Grant. Grants under a particular Section of the Plan need not be
uniform as among the Grantees.

     

    Section 4.  Shares Subject to the
Plan

     

    (a)  Shares
Authorized. Subject
to adjustment as described below, the aggregate number of shares of Company
Stock that may be issued or transferred under the Plan is 2.3
million shares,
plus a number of shares equal to the number of shares subject to outstanding
grants under the
2004 Plan as of the Effective Date. Shares
issued or transferred under the Plan may be authorized but unissued shares of
Company Stock or reacquired shares of Company Stock, including shares purchased
by the Company on the open market for purposes of the Plan. If and to the extent
Options or SARs granted under the Plan (including
options outstanding under the 2004 Plan) terminate,
expire or are canceled, forfeited, exchanged or surrendered without having been
exercised or if any Stock Awards (including
stock awards outstanding under the 2004 Stock Plan), Stock
Units or Other Stock-Based Awards are forfeited, terminated or otherwise not
paid in full, the shares subject to such Grants shall again be available for
purposes of the Plan. Shares of
Company Stock surrendered in payment of the Exercise Price of an Option or
withheld for purposes of satisfying the Company’s minimum tax withholding
obligations with respect to Grants under the Plan shall again be available for
issuance or transfer under the Plan. 

     

    
      
        
        

      

      
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    (b)  Individual
Limits. All
Grants under the Plan shall be expressed in shares of Stock. The maximum
aggregate number of shares of Company Stock that shall be subject to Grants made
under the Plan to any individual during any calendar year shall be 1,000,000
shares, subject to adjustment as described below. 

     

    (c)  Adjustments.
If there
is any change in the number or kind of shares of Company Stock outstanding (i)
by reason of a stock dividend, spinoff, recapitalization, stock split, or
combination or exchange of shares, (ii) by reason of a merger, reorganization or
consolidation, (iii) by reason of a reclassification or change in par value, or
(iv) by reason of any other extraordinary or unusual event affecting the
outstanding Company Stock as a class without the Company’s receipt of
consideration, or if the value of outstanding shares of Company Stock is
substantially reduced as a result of a spinoff or the Company’s payment of an
extraordinary dividend or distribution, the maximum number of shares of Company
Stock available for issuance under the Plan, the maximum number of shares of
Company Stock for which any individual may receive Grants in any year, the kind
and number of shares covered by outstanding Grants, the kind and number of
shares issued and to be issued under the Plan, and the price per share or the
applicable market value of such Grants shall be equitably adjusted by the
Committee, in such manner as the Committee deems appropriate, to reflect any
increase or decrease in the number of, or change in the kind or value of, the
issued shares of Company Stock to preclude, to the extent practicable, the
enlargement or dilution of rights and benefits under the Plan and such
outstanding Grants; provided, however, that any fractional shares resulting from
such adjustment shall be eliminated. In the event of a Change in Control of the
Company, the provisions of Section 16 of the Plan shall apply. Any adjustments
to outstanding Grants shall be consistent with section 409A or 422 of the Code,
to the extent applicable. Any adjustments determined by the Committee shall be
final, binding and conclusive.

     

    Section 5.  Eligibility for
Participation

     

    (a)  Eligible
Persons. All
Employees (including, for all purposes of the Plan, an Employee who is a member
of the Board) and Non-Employee Directors shall be eligible to participate in the
Plan. Key Advisors shall be eligible to participate in the Plan if the Key
Advisors render bona fide services to the Employer, the services are not in
connection with the offer and sale of securities in a capital-raising
transaction and the Key Advisors do not directly or indirectly promote or
maintain a market for the Company’s securities.

     

    (b)  Selection of
Grantees. The
Committee shall select the Employees, Non-Employee Directors and Key Advisors to
receive Grants and shall determine the number of shares of Company Stock subject
to a particular Grant in such manner as the Committee determines. 

     

    
      
        
        

      

      
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    Section 6.  Options

     

    The
Committee may grant Options to an Employee, Non-Employee Director or Key
Advisor, upon such terms as the Committee deems appropriate. The following
provisions are applicable to Options:

     

    (a)  Number of
Shares. The
Committee shall determine the number of shares of Company Stock that will be
subject to each Grant of Options to Employees, Non-Employee Directors and Key
Advisors.

     

    (b)  Type of Option and
Price.

     

    (i)  The
Committee may grant Incentive Stock Options or Nonqualified Stock Options or any
combination of the two, all in accordance with the terms and conditions set
forth herein. Incentive Stock Options may be granted only to employees of the
Company or its parent or subsidiary corporations, as defined in section 424 of
the Code. Nonqualified Stock Options may be granted to Employees, Key Advisors
and Non-Employee Directors.

     

    (ii)  The
Exercise Price of Company Stock subject to an Option shall be determined by the
Committee and shall be equal to or greater than the Fair Market Value of a share
of Company Stock on the date the Option is granted; provided, however, that an
Incentive Stock Option may not be granted to an Employee who, at the time of
grant, owns stock possessing more than 10% of the total combined voting power of
all classes of stock of the Company, or any parent or subsidiary corporation of
the Company, as defined in section 424 of the Code, unless the Exercise Price
per share is not less than 110% of the Fair Market Value of a share of Company
Stock on the date of grant.

     

    (c)  Option
Term. The
Committee shall determine the term of each Option. The term of any Option shall
not exceed ten years from the date of grant. However, an Incentive Stock Option
that is granted to an Employee who, at the time of grant, owns stock possessing
more than 10% of the total combined voting power of all classes of stock of the
Company, or any parent or subsidiary corporation of the Company, as defined in
section 424 of the Code, may not have a term that exceeds five years from the
date of grant.

     

    (d)  Exercisability of
Options. Options
shall become exercisable in accordance with such terms and conditions,
consistent with the Plan, as may be determined by the Committee and specified in
the Grant Instrument. The Committee may accelerate the exercisability of any or
all outstanding Options at any time for any reason. Notwithstanding any
provision to the contrary herein, in the
event a Grantee ceases to be employed by, or provide service to, the Employer by
reason of death or Disability, all of the Grantee’s Options shall become vested
and exercisable in full at the time of such cessation of employment or service.

     

    
      
        
        

      

      
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    (e)  Grants to Non-Exempt
Employees.
Notwithstanding the foregoing, Options granted to persons who are non-exempt
employees under the Fair Labor Standards Act of 1938, as amended, may not be
exercisable for at least six months after the date of grant (except that such
Options may become exercisable, as determined by the Committee, upon the
Grantee’s death, Disability or retirement, or upon a Change of Control or other
circumstances permitted by applicable regulations).

     

    (f)  Termination of Employment,
Disability or Death.

     

    (i)  Except as
provided below, an Option may only be exercised while the Grantee is employed
by, or providing service to, the Employer as an Employee, Key Advisor or member
of the Board. 

     

    (ii)  In the
event that a Grantee ceases to be employed by, or provide service to, the
Employer for any reason other than Disability, death or termination for Cause,
any Option which is otherwise exercisable by the Grantee shall terminate unless
exercised within 90 days after the date on which the Grantee ceases to be
employed by, or provide service to, the Employer (or within such other period of
time as may be specified by the Committee), but in any event no later than the
date of expiration of the Option term. Except as otherwise provided by the
Committee, any of the Grantee’s Options that are not otherwise exercisable as of
the date on which the Grantee ceases to be employed by, or provide service to,
the Employer shall terminate as of such date.

     

    (iii)  In the
event the Grantee ceases to be employed by, or provide service to, the Company
on account of a termination for Cause by the Employer, any Option held by the
Grantee shall terminate as of the date the Grantee ceases to be employed by, or
provide service to, the Employer. In addition, notwithstanding any other
provisions of this Section 6, if the Committee determines that the Grantee has
engaged in conduct that constitutes Cause at any time while the Grantee is
employed by, or providing service to, the Employer or after the Grantee’s
termination of employment or service, any Option held by the Grantee shall
immediately terminate and the Grantee shall automatically forfeit all shares
underlying any exercised portion of an Option for which the Company has not yet
delivered the share certificates, upon refund by the Company of the Exercise
Price paid by the Grantee for such shares. Upon any exercise of an Option, the
Company may withhold delivery of share certificates pending resolution of an
inquiry that could lead to a finding resulting in a forfeiture.

     

    (iv)  In the
event the Grantee ceases to be employed by, or provide service to, the Employer
because the Grantee is Disabled, any Option which is otherwise exercisable by
the Grantee shall terminate unless exercised within one year after the date on
which the Grantee ceases to be employed by, or provide service to, the Employer
(or within such other period of time as may be specified by the Committee), but
in any event no later than the date of expiration of the Option term.

     

    
      
        
        

      

      
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    (v)  If the
Grantee dies while employed by, or providing service to, the Employer or within
90 days after the date on which the Grantee ceases to be employed or provide
service on account of a termination specified in Section 6(e)(ii) above (or
within such other period of time as may be specified by the Committee), any
Option that is otherwise exercisable by the Grantee shall terminate unless
exercised within one year after the date on which the Grantee ceases to be
employed by, or provide service to, the Employer (or within such other period of
time as may be specified by the Committee), but in any event no later than the
date of expiration of the Option term. 

     

    (g)  Exercise of
Options. A
Grantee may exercise an Option that has become exercisable, in whole or in part,
by delivering a notice of exercise to the Company. The Grantee shall pay the
Exercise Price for an Option as specified by the Committee (i) in cash, (ii)
unless the Committee determines otherwise, by delivering shares of Company Stock
owned by the Grantee and having a Fair Market Value on the date of exercise at
least equal to the Exercise Price or by attestation (on a form prescribed by the
Committee) to ownership of shares of Company Stock having a Fair Market Value on
the date of exercise at least equal to the Exercise Price, (iii) by payment
through a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board, or (iv) by such other method as the Committee may
approve. Shares of Company Stock used to exercise an Option shall have been held
by the Grantee for the requisite period of time necessary to avoid adverse
accounting consequences to the Company with respect to the Option. Payment for
the shares to be issued or transferred pursuant to the Option, and any required
withholding taxes, must be received by the Company by the time specified by the
Committee depending on the type of payment being made, but in all cases prior to
the issuance or transfer of such shares.

     

    (h)  Limits on Incentive Stock
Options. Each
Incentive Stock Option shall provide that, if the aggregate Fair Market Value of
the Company Stock on the date of the grant with respect to which Incentive Stock
Options are exercisable for the first time by a Grantee during any calendar
year, under the Plan or any other stock option plan of the Company or a parent
or subsidiary, exceeds $100,000, then the Option, as to the excess, shall be
treated as a Nonqualified Stock Option. An Incentive Stock Option shall not be
granted to any person who is not an Employee of the Company or a parent or
subsidiary corporation (within the meaning of section 424(f) of the Code) of the
Company.

     

    Section 7.  Stock Awards

     

    The
Committee may issue or transfer shares of Company Stock to an Employee, Key
Advisor or Non-Employee Director under a Stock Award, upon such terms as the
Committee deems appropriate. The following provisions are applicable to Stock
Awards:

     

    
      
        
        

      

      
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    (a)  General
Requirements. Shares
of Company Stock issued or transferred pursuant to Stock Awards may be issued or
transferred for consideration or for no consideration, and subject to
restrictions or no restrictions, as determined by the Committee. The Committee
may, but shall not be required to, establish conditions under which restrictions
on Stock Awards shall lapse over a period of time or according to such other
criteria as the Committee deems appropriate, including, without limitation,
restrictions based upon the achievement of specific performance goals. The
period of time during which the Stock Awards will remain subject to restrictions
will be designated in the Grant Instrument as the “Restriction
Period.”

     

    (b)  Number of
Shares. The
Committee shall determine the number of shares of Company Stock to be issued or
transferred pursuant to a Stock Award and the restrictions applicable to such
shares.

     

    (c)  Requirement of Employment or
Service. If the
Grantee ceases to be employed by, or provide service to, the Employer during a
period designated in the Grant Instrument as the Restriction Period, or if other
specified conditions are not met, the Stock Award shall terminate as to all
shares covered by the Grant as to which the restrictions have not lapsed, and
those shares of Company Stock must be immediately returned to the Company. The
Committee may, however, provide for complete or partial exceptions to this
requirement as it deems appropriate.

     

    (d)  Restrictions on Transfer and
Legend on Stock Certificate. During
the Restriction Period, a Grantee may not sell, assign, transfer, pledge or
otherwise dispose of the shares of a Stock Award except under Section 15(a)
below. Unless otherwise determined by the Committee, the Company will retain
possession of certificates for shares of Stock Awards until all restrictions on
such shares have lapsed. Each certificate for a Stock Award, unless held by the
Company, shall contain a legend giving appropriate notice of the restrictions in
the Grant. The Grantee shall be entitled to have the legend removed from the
stock certificate covering the shares subject to restrictions when all
restrictions on such shares have lapsed. The Committee may determine that the
Company will not issue certificates for Stock Awards until all restrictions on
such shares have lapsed. 

     

    (e)  Right to Vote and to Receive
Dividends. Unless
the Committee determines otherwise, during the Restriction Period, the Grantee
shall have the right to vote shares of Stock Awards and to receive any dividends
or other distributions paid on such shares, subject to any restrictions deemed
appropriate by the Committee, including, without limitation, the achievement of
specific performance goals.

     

    (f)  Lapse of
Restrictions. All
restrictions imposed on Stock Awards shall lapse upon the expiration of the
applicable Restriction Period and the satisfaction of all conditions, if any,
imposed by the Committee. The Committee may determine, as to any or all Stock
Awards, that the restrictions shall lapse without regard to any Restriction
Period.

     

    
      
        
        

      

      
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    Section 8.  Stock Units

     

    The
Committee may grant Stock Units, each of which shall represent one hypothetical
share of Company Stock, to an Employee, Key Advisor or Non-Employee Director,
upon such terms and conditions as the Committee deems appropriate. The following
provisions are applicable to Stock Units:

     

    (a)  Crediting of
Units. Each
Stock Unit shall represent the right of the Grantee to receive a share of
Company Stock or an amount of cash based on the value of a share of Company
Stock, if and when specified conditions are met. All Stock Units shall be
credited to bookkeeping accounts established on the Company’s records for
purposes of the Plan. 

     

    (b)  Terms of Stock
Units. The
Committee may grant Stock Units that are payable if specified performance goals
or other conditions are met, or under other circumstances. Stock Units may be
paid at the end of a specified performance period or other period, or payment
may be deferred to a date authorized by the Committee. The Committee shall
determine the number of Stock Units to be granted and the requirements
applicable to such Stock Units. 

     

    (c)  Requirement of Employment or
Service. If the
Grantee ceases to be employed by, or provide service to, the Employer prior to
the vesting of Stock Units, or if other conditions established by the Committee
are not met, the Grantee’s Stock Units shall be forfeited. The Committee may,
however, provide for complete or partial exceptions to this requirement as it
deems appropriate.

     

    (d)  Payment With Respect to
Stock Units.
Payments with respect to Stock Units shall be made in cash, Company Stock or any
combination of the foregoing, as the Committee shall determine.

     

    Section 9.  Stock Appreciation
Rights

     

    The
Committee may grant SARs to an Employee, Key Advisor or Non-Employee Director
separately or in tandem with any Option. The following provisions are applicable
to SARs:

     

    (a)  General
Requirements. The
Committee may grant SARs to an Employee, Key Advisor or Non-Employee Director
separately or in tandem with any Option (for all or a portion of the applicable
Option). Tandem SARs may be granted either at the time the Option is granted or
at any time thereafter while the Option remains outstanding; provided, however,
that, in the case of an Incentive Stock Option, SARs may be granted only at the
time of the Grant of the Incentive Stock Option. The Committee shall establish
the base amount of the SAR at the time the SAR is granted. The base amount of
each SAR shall be equal to the per share Exercise Price of the related Option
or, if there is no related Option, an amount equal to or greater than the Fair
Market Value of a share of Company Stock as of the date of Grant of the
SAR.

     

    
      
        
        

      

      
        EX 10.14 -
PAGE 11

        
          

        

      

      
        
        

      

    

     

     

    (b)  Tandem
SARs. In the
case of tandem SARs, the number of SARs granted to a Grantee that shall be
exercisable during a specified period shall not exceed the number of shares of
Company Stock that the Grantee may purchase upon the exercise of the related
Option during such period. Upon the exercise of an Option, the SARs relating to
the Company Stock covered by such Option shall terminate. Upon the exercise of
SARs, the related Option shall terminate to the extent of an equal number of
shares of Company Stock.

     

    (c)  Exercisability. An SAR
shall be exercisable during the period specified by the Committee in the Grant
Instrument and shall be subject to such vesting and other restrictions as may be
specified in the Grant Instrument. The Committee may accelerate the
exercisability of any or all outstanding SARs at any time for any reason. SARs
may only be exercised while the Grantee is employed by, or providing service to,
the Employer or during the applicable period after termination of employment or
service as described in Section 6(e) above. A tandem SAR shall be exercisable
only during the period when the Option to which it is related is also
exercisable.

     

    (d)  Grants to Non-Exempt
Employees.
Notwithstanding the foregoing, SARs granted to persons who are non-exempt
employees under the Fair Labor Standards Act of 1938, as amended, may not be
exercisable for at least six months after the date of grant (except that such
SARs may become exercisable, as determined by the Committee, upon the Grantee’s
death, Disability or retirement, or upon a Change of Control or other
circumstances permitted by applicable regulations).

     

    (e)  Value of
SARs. When a
Grantee exercises SARs, the Grantee shall receive in settlement of such SARs an
amount equal to the value of the stock appreciation for the number of SARs
exercised. The stock appreciation for an SAR is the amount by which the Fair
Market Value of the underlying Company Stock on the date of exercise of the SAR
exceeds the base amount of the SAR as described in subsection (a).

     

    (f)  Form of
Payment. The
appreciation in an SAR shall be paid in shares of Company Stock, cash or any
combination of the foregoing, as the Committee shall determine. For purposes of
calculating the number of shares of Company Stock to be received, shares of
Company Stock shall be valued at their Fair Market Value on the date of exercise
of the SAR. 

     

    Section 10.  Other Stock-Based
Awards

     

    The
Committee may grant Other Stock-Based Awards, which are awards (other than those
described in Sections 6, 7, 8 and 9 of the Plan) that are based on or measured
by Company Stock, to any Employee, Key Advisor or Non-Employee Director, on such
terms and conditions as the Committee shall determine. Other Stock-Based Awards
may be awarded subject to the achievement of performance goals or other
conditions and may be payable in cash, Company Stock or any combination of the
foregoing, as the Committee shall determine.

     

    
      
        
        

      

      
        EX 10.14 -
PAGE 12

        
          

        

      

      
        
        

      

    

     

    Section 11.  Dividend
Equivalents

     

    The
Committee may grant Dividend Equivalents in connection Stock Units or Other
Stock-Based Awards. Dividend Equivalents may be paid currently or accrued as
contingent cash obligations and may be payable in cash or shares of Company
Stock, and upon such terms as the Committee may establish, including, without
limitation, the achievement of specific performance goals.

     

    Section 12.  Qualified Performance-Based
Compensation

     

    The
Committee may determine that Stock Awards, Stock Units, Other Stock-Based Awards
and Dividend Equivalents granted to an Employee shall be considered “qualified
performance-based compensation” under section 162(m) of the Code. The following
provisions shall apply to Grants of Stock Awards, Stock Units, Other Stock-Based
Awards and Dividend Equivalents that are to be considered “qualified
performance-based compensation” under section 162(m) of the Code: 

     

    (a)  Performance
Goals.

     

    (i)  When
Stock Awards, Stock Units, Other Stock-Based Awards or Dividend Equivalents that
are to be considered “qualified performance-based compensation” are granted, the
Committee shall establish in writing (A) the objective performance goals that
must be met, (B) the performance period during which the performance will be
measured, (C) the threshold, target and maximum amounts that may be paid if the
performance goals are met, and (D) any other conditions that the Committee deems
appropriate and consistent with the Plan and Section 162(m) of the Code.

     

    (ii)  The
business criteria may relate to the Grantee’s business unit or the performance
of the Company and its parents and subsidiaries as a whole, or any combination
of the foregoing. The Committee shall use objectively determinable performance
goals based on one or more of the following criteria: stock price, earnings per
share, net earnings, operating earnings, earnings before income taxes, EBITDA
(earnings before income tax expense, interest expense, and depreciation and
amortization expense), return on assets, stockholder return, return on equity,
growth in assets, unit volume, sales or market share, or strategic business
criteria consisting of one or more objectives based on meeting specified revenue
goals, market penetration goals, geographic business expansion goals, cost
targets or goals relating to acquisitions or divestitures. 

     

    
      
        
        

      

      
        EX 10.14 -
PAGE 13

        
          

        

      

      
        
        

      

    

    
 

     

    (b)  Establishment of
Goals. The
Committee shall establish the performance goals in writing either before the
beginning of the performance period or during a period ending no later than the
earlier of (i) 90 days after the beginning of the performance period or (ii) the
date on which 25% of the performance period has been completed, or such other
date as may be required or permitted under applicable regulations under section
162(m) of the Code. The performance goals shall satisfy the requirements for
“qualified performance-based compensation,” including the requirement that the
achievement of the goals be substantially uncertain at the time they are
established and that the goals be established in such a way that a third party
with knowledge of the relevant facts could determine whether and to what extent
the performance goals have been met. The Committee shall not have discretion to
increase the amount of compensation that is payable upon achievement of the
designated performance goals.

     

    (c)  Announcement of
Grants. The
Committee shall certify and announce the results for each performance period to
all Grantees after the announcement of the Company’s financial results for the
performance period. If and to the extent that the Committee does not certify
that the performance goals have been met, the grants of Stock Awards, Stock
Units, Other Stock-Based Awards and Dividend Equivalents for the performance
period shall be forfeited or shall not be made, as applicable. If Dividend
Equivalents are granted as “qualified performance-based compensation” under
section 162(m) of the Code, a Grantee may not accrue more than $1,000,000 of
such Dividend Equivalents during any calendar year. 

     

    (d)  Death, Disability or Other
Circumstances. The
Committee may provide that Stock Awards, Stock Units, Other Stock-Based Awards
and Dividend Equivalents shall be payable or restrictions on such Grants shall
lapse, in whole or in part, in the event of the Grantee’s death or Disability
during the performance period, or under other circumstances consistent with the
Treasury regulations and rulings under section 162(m) of the Code.

     

    Section 13.  Deferrals

     

    The
Committee may permit or require a Grantee to defer receipt of the payment of
cash or the delivery of shares that would otherwise be due to such Grantee in
connection with any Stock Units or Other
Stock-Based Awards. If any
such deferral election is permitted or required, the Committee shall establish
rules and procedures for such deferrals and may provide for interest or other
earnings to be paid on such deferrals. The rules and procedures for any such
deferrals shall be consistent with applicable requirements of section 409A of
the Code.

     

    
      
        
        

      

      
        EX 10.14 -
PAGE 14

        
          

        

      

      
        
        

      

    

     

    Section 14.  Withholding of
Taxes

     

    (a)  Required
Withholding. All
Grants under the Plan shall be subject to applicable federal (including FICA),
state and local tax withholding requirements. The Employer may require that the
Grantee or other person receiving or exercising Grants pay to the Employer the
amount of any federal, state or local taxes that the Employer is required to
withhold with respect to such Grants, or the Employer may deduct from other
wages and compensation paid by the Employer the amount of any withholding taxes
due with respect to such Grants.

     

    (b)  Election to Withhold
Shares. If the
Committee so permits, a Grantee may elect to satisfy the Employer’s tax
withholding obligation with respect to Grants paid in Company Stock by having
shares withheld up to an amount that does not exceed the Grantee’s minimum
applicable withholding tax rate for federal (including FICA), state and local
tax liabilities. The election must be in a form and manner prescribed by the
Committee and may be subject to the prior approval of the
Committee.

     

    Section 15.  Transferability of
Grants

     

    (a)  Nontransferability of
Grants. Except
as provided below, only the Grantee may exercise rights under a Grant during the
Grantee’s lifetime. A Grantee may not transfer those rights except (i) by will
or by the laws of descent and distribution or (ii) with respect to Grants other
than Incentive Stock Options, pursuant to a domestic relations order. When a
Grantee dies, the personal representative or other person entitled to succeed to
the rights of the Grantee may exercise such rights. Any such successor must
furnish proof satisfactory to the Company of his or her right to receive the
Grant under the Grantee’s will or under the applicable laws of descent and
distribution.

     

    (b)  Transfer of Nonqualified
Stock Options.
Notwithstanding the foregoing, the Committee may provide, in a Grant Instrument,
that a Grantee may transfer Nonqualified Stock Options to family members, or one
or more trusts or other entities for the benefit of or owned by family members,
consistent with the applicable securities laws, according to such terms as the
Committee may determine; provided that the Grantee receives no consideration for
the transfer of an Option and the transferred Option shall continue to be
subject to the same terms and conditions as were applicable to the Option
immediately before the transfer.

     

    Section 16.  Consequences of a Change of
Control

     

    (a)  Notice and
Acceleration. Unless
the Committee determines otherwise, effective upon the date of the Change of
Control, (i) all outstanding Options and SARs shall automatically accelerate and
become fully exercisable, (ii) the restrictions and conditions on all
outstanding Stock Awards shall immediately lapse, and (iii) all Stock Units,
Other Stock-Based Awards and Dividend Equivalents shall become fully vested and
shall be paid at their target values, or in such greater amounts as the
Committee may determine.

     

    
      
        
        

      

      
        EX 10.14 -
PAGE 15

        
          

        

      

      
        
        

      

    

     

    (b)  Other
Alternatives.
Notwithstanding the foregoing, in the event of a Change of Control, the
Committee may take one or more of the following actions with respect to any or
all outstanding Grants: the Committee may (i) require that Grantees surrender
their outstanding Options and SARs in exchange for one or more payments by the
Company, in cash or Company Stock as determined by the Committee, in an amount
equal to the amount by which the then Fair Market Value of the shares of Company
Stock subject to the Grantee’s unexercised Options and SARs exceeds the Exercise
Price of the Options or the base amount of the SARs, as applicable, (ii) after
giving Grantees an opportunity to exercise their outstanding Options and SARs,
terminate any or all unexercised Options and SARs at such time as the Committee
deems appropriate, or (iii) determine that outstanding Options and SARs that are
not exercised shall be assumed by, or replaced with comparable options or rights
by, the surviving corporation, (or a parent or subsidiary of the surviving
corporation), and other outstanding Grants that remain in effect after the
Change of Control shall be converted to similar grants of the surviving
corporation (or a parent or subsidiary of the surviving corporation). Such
surrender or termination shall take place as of the date of the Change of
Control or such other date as the Committee may specify.

     

    Section 17.  Requirements for Issuance or
Transfer of Shares

     

    No
Company Stock shall be issued or transferred in connection with any Grant
hereunder unless and until all legal requirements applicable to the issuance or
transfer of such Company Stock have been complied with to the satisfaction of
the Committee. The Committee shall have the right to condition any Grant on the
Grantee’s undertaking in writing to comply with such restrictions on his or her
subsequent disposition of the shares of Company Stock as the Committee shall
deem necessary or advisable, and certificates representing such shares may be
legended to reflect any such restrictions. Certificates representing shares of
Company Stock issued or transferred under the Plan may be subject to such
stop-transfer orders and other restrictions as the Committee deems appropriate
to comply with applicable laws, regulations and interpretations, including any
requirement that a legend be placed thereon.

     

    Section 18.  Amendment and Termination of the
Plan

     

    (a)  Amendment. The
Board may amend or terminate the Plan at any time; provided, however, that the
Board shall not amend the Plan without stockholder approval if such approval is
required in order to comply with the Code or other applicable law, or to comply
with applicable stock exchange requirements.

     

    (b)  No Repricing Without
Stockholder Approval.
Notwithstanding anything in the Plan to the contrary, the Committee may not
reprice Options, nor may the Board amend the Plan to permit repricing of
Options, unless the stockholders of the Company provide prior approval for such
repricing. An adjustment to an Option pursuant to Section 4(c) above shall not
constitute a repricing of the Option.] [Please confirm that this complies with
the Company’s intent.

     

    
      
        
        

      

      
        EX 10.14 -
PAGE 16

        
          

        

      

      
        
        

      

    

     

     

    (c)  Stockholder Re-Approval
Requirement. If
Stock Awards, Stock Units, Other Stock-Based Awards or Dividend Equivalents are
granted as “qualified performance-based compensation” under Section 12 above,
the Plan must be reapproved by the stockholders no later than the first
stockholders meeting that occurs in the fifth year following the year in which
the stockholders previously approved the provisions of Section 12, if required
by section 162(m) of the Code or the regulations thereunder.

     

    (d)  Termination of
Plan. The
Plan shall terminate on the day immediately preceding the tenth anniversary of
its effective date, unless the Plan is terminated earlier by the Board or is
extended by the Board with the approval of the stockholders.

     

    (e)  Termination and Amendment of
Outstanding Grants. A
termination or amendment of the Plan that occurs after a Grant is made shall not
materially impair the rights of a Grantee unless the Grantee consents or unless
the Committee acts under Section 19(f) below. The termination of the Plan shall
not impair the power and authority of the Committee with respect to an
outstanding Grant. Whether or not the Plan has terminated, an outstanding Grant
may be terminated or amended under Section 19(f) below or may be amended by
agreement of the Company and the Grantee consistent with the Plan.

     

    Section 19.  Miscellaneous

     

    (a)  Grants in Connection with
Corporate Transactions and Otherwise. Nothing
contained in the Plan shall be construed to (i) limit the right of the Committee
to make Grants under the Plan in connection with the acquisition, by purchase,
lease, merger, consolidation or otherwise, of the business or assets of any
corporation, firm or association, including Grants to employees thereof who
become Employees, or (ii) limit the right of the Company to grant stock options
or make other awards outside of the Plan. The Committee may make a Grant to an
employee of another corporation who becomes an Employee by reason of a corporate
merger, consolidation, acquisition of stock or property, reorganization or
liquidation involving the Company, in substitution for a stock option or stock
awards grant made by such corporation. Notwithstanding anything in the Plan to
the contrary, the Committee may establish such terms and conditions of the new
Grants as it deems appropriate, including setting the Exercise Price of Options
or the base price of SARs at a price necessary to retain for the Grantee the
same economic value as the prior options or rights.

     

    (b)  Governing
Document. The
Plan shall be the controlling document. No other statements, representations,
explanatory materials or examples, oral or written, may amend the Plan in any
manner. The Plan shall be binding upon and enforceable against the Company and
its successors and assigns.

     

    
      
        
        

      

      
        EX 10.14 -
PAGE 17

        
          

        

      

      
        
        

      

    

     

    (c)  Funding of the
Plan. The
Plan shall be unfunded. The Company shall not be required to establish any
special or separate fund or to make any other segregation of assets to assure
the payment of any Grants under the Plan.

     

    (d)  Rights of
Grantees. Nothing
in the Plan shall entitle any Employee, Key Advisor, Non-Employee Director or
other person to any claim or right to be granted a Grant under the Plan. Neither
the Plan nor any action taken hereunder shall be construed as giving any
individual any rights to be retained by or in the employ of the Employer or any
other employment rights.

     

    (e)  No Fractional
Shares. No
fractional shares of Company Stock shall be issued or delivered pursuant to the
Plan or any Grant. Except as otherwise provided under the Plan, the Committee
shall determine whether cash, other awards or other property shall be issued or
paid in lieu of such fractional shares or whether such fractional shares or any
rights thereto shall be forfeited or otherwise eliminated.

     

    (f)  Compliance with
Law. The
Plan, the exercise of Options and SARs and the obligations of the Company to
issue or transfer shares of Company Stock under Grants shall be subject to all
applicable laws and regulations, and to approvals by any governmental or
regulatory agency as may be required. With respect to persons subject to section
16 of the Exchange Act, it is the intent of the Company that the Plan and all
transactions under the Plan comply with all applicable provisions of Rule 16b-3
or its successors under the Exchange Act. In addition, it is the intent of the
Company that Incentive Stock Options comply with the applicable provisions of
section 422 of the Code, that Grants of “qualified performance-based
compensation” comply with the applicable provisions of section 162(m) of the
Code and that, to the extent applicable, Grants comply with the requirements of
section 409A of the Code. To the extent that any legal requirement of section 16
of the Exchange Act or section 422, 162(m) or 409A of the Code as set forth in
the Plan ceases to be required under section 16 of the Exchange Act or section
422, 162(m) or 409A of the Code, that Plan provision shall cease to apply. The
Committee may revoke any Grant if it is contrary to law or modify a Grant to
bring it into compliance with any valid and mandatory government regulation.

     

    (g)  Employees Subject to
Taxation Outside the United States. With
respect to Grantees who are believed by the Committee to be subject to taxation
in countries other than the United States, the Committee may make Grants on such
terms and conditions, consistent with the Plan, as the Committee deems
appropriate to comply with the laws of the applicable countries, and the
Committee may create such procedures, addenda and subplans and make such
modifications as may be necessary or advisable to comply with such
laws.

     

    (h)  Governing
Law. The
validity, construction, interpretation and effect of the Plan and Grant
Instruments issued under the Plan shall be governed and construed by and
determined in accordance with the laws of the State of Nevada, without giving
effect to the conflict of laws provisions thereof.

     

     

    
      
        
        

      

      
        EX 10.14 -
PAGE 18SUBSCRIPTION
        AGREEMENT

       

      SUBSCRIPTION
        AGREEMENT (this “Agreement”) made as of the last date set forth on the signature
        page hereof between OriginOil, Inc. (the “Company”), and the undersigned (the
“Subscriber”). 

       

      W
        I T N E
        S S E T H: 

       

      WHEREAS,
        the Company is conducting a private offering (the “Offering”) consisting of up
        to 15,000,000 shares of common stock, par value $.0001 per share (“Shares”); and

       

      WHEREAS,
        the Subscriber desires to purchase that number of Shares set forth on the
        signature page hereof on the terms and conditions hereinafter set forth.
        

       

      NOW,
        THEREFORE, in consideration of the premises and the mutual representations
        and
        covenants hereinafter set forth, the parties hereto do hereby agree as follows:
        

      

      I.
        SUBSCRIPTION
        FOR SHARES AND REPRESENTATIONS BY SUBSCRIBER 

       

      1.1
        Subject to the terms and conditions hereinafter set forth and in the
        Confidential Offering Memorandum dated August 3, 2007 (such memorandum, together
        with all amendments thereof and supplements and exhibits thereto, the
“Memorandum”), the Subscriber hereby irrevocably subscribes for and agrees to
        purchase from the Company such number of Shares, and the Company agrees to
        sell
        to the Subscriber as is set forth on the signature page hereof, at a per
        share
        price equal to $0.10 per Share. The purchase price is payable by personal
        or
        business check or money order made payable to “OriginOil, Inc.”
contemporaneously with the execution and delivery of this Agreement by the
        Subscriber. Subscribers may also pay the subscription amount by, wire transfer
        of immediately available funds to: 

       

      
        	
                Name:
                  

              	
                OriginOil,
                  Inc. 

              
	 	 
	
                Bank:
                  

              	
                Wells
                  Fargo Bank 

                1300
                  4th
                  Street 

                Santa
                  Monica, CA 90401 

              
	 	 
	
                Account:
                  

              	
                7833317113
                  

              
	 	 
	
                Wiring
                  ABA:

              	
                121000248

              

      

       

      1.2
        The
        Subscriber recognizes that the purchase of the Shares involves a high degree
        of
        risk including, but not limited to, the following: (a) the Company remains
        a
        development stage business with limited operating history and requires
        substantial funds in addition to the proceeds of the Offering; (b) an investment
        in the Company is highly speculative, and only investors who can afford the
        loss
        of their entire investment should consider investing in the Company and the
        Shares; (c) the Subscriber may not be able to liquidate its investment; (d)
        transferability of the Shares (sometimes hereinafter collectively referred
        to as
        the “Securities”) is extremely limited; (e) in the event of a disposition, the
        Subscriber could sustain the loss of its entire investment; (f) the Company
        has
        not paid any dividends since its inception and does not anticipate paying
        any
        dividends; and (g) the Company may issue additional securities in the future
        which have rights and preferences that are senior to those of the Common
        Stock.
        Without limiting the generality of the representations set forth in Section
        1.5
        below, the Subscriber represents that the Subscriber has carefully reviewed
        the
        section of the Memorandum captioned “Risk Factors.” 

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      1.3
        The
        Subscriber represents that the Subscriber is an “accredited investor” as such
        term is defined in Rule 501 of Regulation D (“Regulation D”) promulgated under
        the Securities Act of 1933, as amended (the “Securities Act”), as indicated by
        the Subscriber’s responses to the questions contained in Article VII hereof, and
        that the Subscriber is able to bear the economic risk of an investment in
        the
        Shares. 

       

      1.4
        The
        Subscriber hereby acknowledges and represents that (a) the Subscriber has
        knowledge and experience in business and financial matters, prior investment
        experience, including investment in securities that are non-listed, unregistered
        and/or not traded on a national securities exchange nor on the National
        Association of Securities Dealers, Inc. (the “NASD”) automated quotation system
        (“NASDAQ”), or the Subscriber has employed the services of a “purchaser
        representative” (as defined in Rule 501 of Regulation D), attorney and/or
        accountant to read all of the documents furnished or made available by the
        Company both to the Subscriber and to all other prospective investors in
        the
        Shares to evaluate the merits and risks of such an investment on the
        Subscriber’s behalf; (b) the Subscriber recognizes the highly speculative nature
        of this investment; and (c) the Subscriber is able to bear the economic risk
        that the Subscriber hereby assumes. 

       

      1.5
        The
        Subscriber hereby acknowledges receipt and careful review of this Agreement,
        the
        Memorandum (which includes the Risk Factors), including all exhibits thereto,
        and any documents which may have been made available upon request as reflected
        therein (collectively referred to as the “Offering Materials”) and hereby
        represents that the Subscriber has been furnished by the Company during the
        course of the Offering with all information regarding the Company, the terms
        and
        conditions of the Offering and any additional information that the Subscriber
        has requested or desired to know, and has been afforded the opportunity to
        ask
        questions of and receive answers from duly authorized officers or other
        representatives of the Company concerning the Company and the terms and
        conditions of the Offering. 

       

      1.6
        (a)
        In making the decision to invest in the Shares the Subscriber has relied
        solely
        upon the information provided by the Company in the Offering Materials. To
        the
        extent necessary, the Subscriber has retained, at its own expense, and relied
        upon appropriate professional advice regarding the investment, tax and legal
        merits and consequences of this Agreement and the purchase of the Shares
        hereunder. The Subscriber disclaims reliance on any statements made or
        information provided by any person or entity in the course of Subscriber’s
        consideration of an investment in the Shares other than the Offering Materials.
        

       

      (b) The
        Subscriber represents that (i) the Subscriber was contacted regarding the
        sale
        of the Shares by the Company (or an authorized agent or representative thereof)
        with whom the Subscriber had a prior substantial pre-existing relationship
        and
        (ii) no Shares were offered or sold to it by means of any form of general
        solicitation or general advertising, and in connection therewith, the Subscriber
        did not (A) receive or review any advertisement, article, notice or other
        communication published in a newspaper or magazine or similar media or broadcast
        over television or radio, whether closed circuit, or generally available;
        or (B)
        attend any seminar meeting or industry investor conference whose attendees
        were
        invited by any general solicitation or general advertising. 

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      1.7
        The
        Subscriber hereby represents that the Subscriber, either by reason of the
        Subscriber’s business or financial experience or the business or financial
        experience of the Subscriber’s professional advisors (who are unaffiliated with
        and not compensated by the Company or any affiliate or selling agent of the
        Company, directly or indirectly), has the capacity to protect the Subscriber’s
        own interests in connection with the transaction contemplated hereby.

       

      1.8
        The
        Subscriber hereby acknowledges that the Offering has not been reviewed by
        the
        United States Securities and Exchange Commission (the “SEC”) nor any state
        regulatory authority since the Offering is intended to be exempt from the
        registration requirements of Section 5 of the Securities Act pursuant to
        Regulation D promulgated thereunder. The Subscriber understands that the
        Securities have not been registered under the Securities Act or under any
        state
        securities or “blue sky” laws and agrees not to sell, pledge, assign or
        otherwise transfer or dispose of the Securities unless they are registered
        under
        the Securities Act and under any applicable state securities or “blue sky” laws
        or unless an exemption from such registration is available. 

       

      1.9
        The
        Subscriber understands that the Securities comprising the Shares have not
        been
        registered under the Securities Act by reason of a claimed exemption under
        the
        provisions of the Securities Act that depends, in part, upon the Subscriber’s
        investment intention. In this connection, the Subscriber hereby represents
        that
        the Subscriber is purchasing the Securities for the Subscriber’s own account for
        investment and not with a view toward the resale or distribution to others.
        The
        Subscriber, if an entity, further represents that it was not formed for the
        purpose of purchasing the Securities. 

       

      1.10 The
        Subscriber understands that there is no public market for the Common Stock
        and
        that no market may develop for any of such Securities. The Subscriber
        understands that even if a public market develops for such Securities, Rule
        144
        (“Rule 144”) promulgated under the Securities Act requires for non-affiliates,
        among other conditions, a one-year holding period prior to the resale (in
        limited amounts) of securities acquired in a non-public offering without
        having
        to satisfy the registration requirements under the Securities Act. The
        Subscriber understands and hereby acknowledges that the Company is under
        no
        obligation to register any of the Securities under the Securities Act or
        any
        state securities or “blue sky” laws other than as set forth in Article V.

       

      1.11 The
        Subscriber consents to the placement of a legend on any certificate or other
        document evidencing the Securities that such Securities have not been registered
        under the Securities Act or any state securities or “blue sky” laws and setting
        forth or referring to the restrictions on transferability and sale thereof
        contained in this Agreement. The Subscriber is aware that the Company will
        make
        a notation in its appropriate records with respect to the restrictions on
        the
        transferability of such Securities. The legend to be placed on each certificate
        shall be in form substantially similar to the following: 

       

      “THE
        SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
        SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”) OR ANY STATE SECURITIES OR “BLUE
        SKY LAWS,” AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR
        HYPOTHECATED ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR
        COMPLIANCE WITH RULE 144 PROMULGATED UNDER SUCH ACT, OR UNLESS THE COMPANY
        HAS
        RECEIVED AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY AND
        ITS
        COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.” 

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      1.12
        The
        Subscriber understands that the Company will review this Agreement and is
        hereby
        given authority by the Subscriber to call Subscriber’s bank or place of
        employment or otherwise review the financial standing of the Subscriber;
        and it
        is further agreed that the Company, at its sole discretion, reserves the
        unrestricted right, without further documentation or agreement on the part
        of
        the Subscriber, to reject or limit any subscription, to accept subscriptions
        for
        fractional Shares and to close the Offering to the Subscriber at any time
        and
        that the Company will issue stop transfer instructions to its transfer agent
        with respect to such Securities. 

       

      1.13
        The
        Subscriber hereby represents that the address of the Subscriber furnished
        by
        Subscriber on the signature page hereof is the Subscriber’s principal residence
        if Subscriber is an individual or its principal business address if it is
        a
        corporation or other entity. 

       

      1.14
        The
        Subscriber represents that the Subscriber has full power and authority
        (corporate, statutory and otherwise) to execute and deliver this Agreement
        and
        to purchase the Shares. This Agreement constitutes the legal, valid and binding
        obligation of the Subscriber, enforceable against the Subscriber in accordance
        with its terms. 

       

      1.15
        If
        the Subscriber is a corporation, partnership, limited liability company,
        trust,
        employee benefit plan, individual retirement account, Keogh Plan, or other
        tax-exempt entity, it is authorized and qualified to invest in the Company
        and
        the person signing this Agreement on behalf of such entity has been duly
        authorized by such entity to do so. 

       

      1.16
        The
        Subscriber acknowledges that if he or she is a Registered Representative
        of an
        NASD member firm, he or she must give such firm the notice required by the
        NASD’s Rules of Fair Practice, receipt of which must be acknowledged by such
        firm in Section 7.4 below. 

       

      1.17
        The
        Subscriber acknowledges that at such time, if ever, as the Securities are
        registered (as such term is defined in Article V hereof), sales of the
        Securities will be subject to state securities laws. 

       

      1.18
        (a)
        The Subscriber agrees not to issue any public statement with respect to the
        Subscriber’s investment or proposed investment in the Company or the terms of
        any agreement or covenant between them and the Company without the Company’s
        prior written consent, except such disclosures as may be required under
        applicable law or under any applicable order, rule or regulation. 

       

      (b)
        The
        Company agrees not to disclose the names, addresses or any other information
        about the Subscribers, except as required by law; provided, that the Company
        may
        use the name of the Subscriber for any offering or in any registration statement
        filed pursuant to Article V in which the Subscriber’s shares are included.

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      1.19 The
        Subscriber agrees to hold the Company and its directors, officers, employees,
        affiliates, controlling persons and agents and their respective heirs,
        representatives, successors and assigns harmless and to indemnify them against
        all liabilities, costs and expenses incurred by them as a result of (a) any
        sale
        or distribution of the Securities by the Subscriber in violation of the
        Securities Act or any applicable state securities or “blue sky” laws; or (b) any
        false representation or warranty or any breach or failure by the Subscriber
        to
        comply with any covenant made by the Subscriber in this Agreement (including
        the
        Confidential Investor Questionnaire contained in Article VII herein) or any
        other document furnished by the Subscriber to any of the foregoing in connection
        with this transaction. 

       

      II.
        REPRESENTATIONS
        BY AND COVENANTS OF THE COMPANY 

       

      The
        Company hereby represents and warrants to the Subscriber that: 

       

      2.1
        Organization,
        Good Standing and Qualification.
        The
        Company is a corporation duly organized, validly existing and in good standing
        under the laws of the State of Nevada and has full corporate power and authority
        to conduct its business. 

       

      2.2
        Capitalization
        and Voting Rights.
        The
        Company has authorized 500,000,000 shares of Common Stock, par value $.0001
        per
        share, of which 129,250,000 shares are outstanding as of the date hereof.
        Except
        as set forth in the Offering Materials, there are no outstanding options,
        warrants, agreements, convertible securities, preemptive rights or other
        rights
        to subscribe for or to purchase any shares of capital stock of the Company.
        Except as set forth in the Offering Materials and as otherwise required by
        law,
        there are no restrictions upon the voting or transfer of any of the shares
        of
        capital stock of the Company pursuant to the Company’s Articles of Incorporation
        (the “Articles of Incorporation”), By-Laws or other governing documents or any
        agreement or other instruments to which the Company is a party or by which
        the
        Company is bound. 

       

      2.3
        Authorization;
        Enforceability.
        The
        Company has all corporate right, power and authority to enter into this
        Agreement and to consummate the transactions contemplated hereby. All corporate
        action on the part of the Company, its directors and stockholders necessary
        for
        the (i) authorization execution, delivery and performance of this Agreement
        by
        the Company; and (ii) authorization, sale, issuance and delivery of the
        Securities contemplated hereby and the performance of the Company’s obligations
        hereunder has been taken. This Agreement has been duly executed and delivered
        by
        the Company and constitutes a legal, valid and binding obligation of the
        Company, enforceable against the Company in accordance with its terms, subject
        to laws of general application relating to bankruptcy, insolvency and the
        relief
        of debtors and rules of law governing specific performance, injunctive relief
        or
        other equitable remedies, and to limitations of public policy. The Common
        Stock,
        when issued and fully paid for in accordance with the terms of this Agreement,
        will be validly issued, fully paid and nonassessable. The issuance and sale
        of
        the Common Stock contemplated hereby will not give rise to any preemptive
        rights
        or rights of first refusal on behalf of any person which have not been waived
        in
        connection with this offering. 

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      2.4 No
        Conflict; Governmental Consents.
        

      

      (a) The
        execution and delivery by the Company of this Agreement and the consummation
        of
        the transactions contemplated hereby will not result in the violation of
        any
        material law, statute, rule, regulation, order, writ, injunction, judgment
        or
        decree of any court or governmental authority to or by which the Company
        is
        bound, or of any provision of the Articles of Incorporation or By-Laws of
        the
        Company, and will not conflict with, or result in a material breach or violation
        of, any of the terms or provisions of, or constitute (with due notice or
        lapse
        of time or both) a default under, any lease, loan agreement, mortgage, security
        agreement, trust indenture or other agreement or instrument to which the
        Company
        is a party or by which it is bound or to which any of its properties or assets
        is subject, nor result in the creation or imposition of any lien upon any
        of the
        properties or assets of the Company. 

      

      (b) No
        consent, approval, authorization or other order of any governmental authority
        is
        required to be obtained by the Company in connection with the authorization,
        execution and delivery of this Agreement or with the authorization, issue
        and
        sale of the Shares, except such filings as may be required to be made with
        the
        SEC, NASD, NASDAQ and with any state or foreign blue sky or securities
        regulatory authority. 

      

      2.5 Licenses. Except
        as otherwise set forth in the Memorandum, the Company has sufficient licenses,
        permits and other governmental authorizations currently required for the
        conduct
        of its business or ownership of properties and is in all material respects
        in
        compliance therewith. 

       

      2.6 Litigation. The
        Company knows of no pending or threatened legal or governmental proceedings
        against the Company which could materially adversely affect the business,
        property, financial condition or operations of the Company or which materially
        and adversely questions the validity of this Agreement or any agreements
        related
        to the transactions contemplated hereby or the right of the Company to enter
        into any of such agreements, or to consummate the transactions contemplated
        hereby or thereby. The Company is not a party or subject to the provisions
        of
        any order, writ, injunction, judgment or decree of any court or government
        agency or instrumentality which could materially adversely affect the business,
        property, financial condition or operations of the Company. There is no action,
        suit, proceeding or investigation by the Company currently pending in any
        court
        or before any arbitrator or that the Company intends to initiate. 

       

      2.7 Disclosure. The
        information set forth in the Offering Materials as of the date hereof contains
        no untrue statement of a material fact nor omits to state a material fact
        necessary in order to make the statements contained therein, in light of
        the
        circumstances under which they were made, not misleading. 

       

      2.8
        Investment
        Company. The
        Company is not an “investment company” within the meaning of such term under the
        Investment Company Act of 1940, as amended, and the rules and regulations
        of the
        SEC thereunder. 

       

      2.9
        Intellectual
        Property.
        

       

      (i) To
        the best of its knowledge, the Company owns or possesses sufficient legal
        rights
        to all patents, trademarks, service marks, trade names, copyrights, trade
        secrets, licenses, information and other proprietary rights and processes
        necessary for its business as now conducted and as presently proposed to
        be
        conducted, without any known infringement of the rights of others. Except
        as
        disclosed in the Memorandum, there are no material outstanding options, licenses
        or agreements of any kind relating to the foregoing proprietary rights, nor
        is
        the Company bound by or a party to any material options, licenses or agreements
        of any kind with respect to the patents, trademarks, service marks, trade
        names,
        copyrights, trade secrets, licenses, information and other proprietary rights
        and processes of any other person or entity other than such licenses or
        agreements arising from the purchase of “off the shelf” or standard products.
        The Company has not received any written communications alleging that the
        Company has violated or, by conducting its business as presently proposed
        to be
        conducted, would violate any of the patents, trademarks, service marks, trade
        names, copyrights or trade secrets or other proprietary rights of any other
        person or entity. 

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      (ii) Except
        as disclosed in the Memorandum, the Company is not aware that any of its
        employees is obligated under any contract (including licenses, covenants
        or
        commitments of any nature) or other agreement, or subject to any judgment,
        decree or order of any court or administrative agency, that would interfere
        with
        their duties to the Company or that would conflict with the Company’s business
        as presently conducted. 

      

      (iii) Neither
        the execution nor delivery of this Agreement, nor the carrying on of the
        Company’s business by the employees of the Company, nor the conduct of the
        Company’s business as presently conducted, will, to the Company’s knowledge,
        conflict with or result in a breach of the terms, conditions or provisions
        of,
        or constitute a default under, any contract, covenant or instrument under
        which
        any employee is now obligated. 

       

      (iv) To
        the Company’s knowledge, no employee of the Company, nor any consultant with
        whom the Company has contracted, is in violation of any term of any employment
        contract, proprietary information agreement or any other agreement relating
        to
        the right of any such individual to be employed by, or to contract with,
        the
        Company because of the nature of the business conducted by the Company; and
        to
        the Company’s knowledge the continued employment by the Company of its present
        employees, and the performance of the Company’s contracts with its independent
        contractors, will not result in any such violation. The Company has not received
        any written notice alleging that any such violation has occurred. Except
        as
        described in the Memorandum, no employee of the Company has been granted
        the
        right to continued employment by the Company or to any compensation following
        termination of employment with the Company except for any of the same which
        would not have a material adverse effect on the business of the Company.
        The
        Company is not aware that any officer, key employee or group of employees
        intends to terminate his, her or their employment with the Company, nor does
        the
        Company have a present intention to terminate the employment of any officer,
        key
        employee or group of employees. 

       

      2.10 Title
        to Properties and Assets; Liens, Etc.
        The
        Company has good and marketable title to its properties and assets, including
        the properties and assets reflected in the most recent balance sheet included
        in
        the Financial Statements, and good title to its leasehold estates, in each
        case
        subject to no mortgage, pledge, lien, lease, encumbrance or charge, other
        than
        (a) those resulting from taxes which have not yet become delinquent; (b)
        liens
        and encumbrances which do not materially detract from the value of the property
        subject thereto or materially impair the operations of the Company; and (c)
        those that have otherwise arisen in the ordinary course of business. The
        Company
        is in compliance with all material terms of each lease to which it is a party
        or
        is otherwise bound. 

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      2.11 Obligations
        to Related Parties.
        Except
        as described in the Memorandum, there are no obligations of the Company to
        officers, directors, stockholders, or employees of the Company other than
        (a)
        for payment of salary or other compensation for services rendered, (b)
        reimbursement for reasonable expenses incurred on behalf of the Company and
        (c)
        for other standard employee benefits made generally available to all employees
        (including stock option agreements outstanding under any stock option plan
        approved by the Board of Directors of the Company). Except as may be disclosed
        in the Memorandum, the Company is not a guarantor or indemnitor of any
        indebtedness of any other person, firm or corporation. 

       

      III.
        TERMS
        OF SUBSCRIPTION 

       

      3.1 There
        is no requirement that any minimum number of Shares be sold and therefore
        no
        escrow will be established for subscription funds. Subscription funds may
        be
        deposited by the Company directly into its operating account for use as
        described in this Confidential Offering Memorandum. 

       

      3.2
        Certificates representing the Common Stock purchased by the Subscriber pursuant
        to this Agreement will be prepared for delivery to the Subscriber within
        15
        business days following the Closing at which such purchase takes place. The
        Subscriber hereby authorizes and directs the Company to deliver the certificates
        representing the Common Stock purchased by the Subscriber pursuant to this
        Agreement directly to the Subscriber’s residential or business address indicated
        on the signature page hereto. 

       

      IV.
        CONDITIONS
        TO OBLIGATIONS OF THE SUBSCRIBERS 

       

      4.1 The
        Subscriber’s obligation to purchase the Shares at the Closing at which such
        purchase is to be consummated is subject to the fulfillment on or prior to
        such
        Closing of the following conditions, which conditions may be waived at the
        option of each Subscriber to the extent permitted by law: 

       

      (a) Covenants.
        All
        covenants, agreements and conditions contained in this Agreement to be performed
        by the Company on or prior to the date of such Closing shall have been performed
        or complied with in all material respects. 

       

      (b) No
        Legal Order Pending.
        There
        shall not then be in effect any legal or other order enjoining or restraining
        the transactions contemplated by this Agreement. 

       

      (c) No
        Law
        Prohibiting or Restricting Such Sale.
        There
        shall not be in effect any law, rule or regulation prohibiting or restricting
        such sale or requiring any consent or approval of any person, which shall
        not
        have been obtained, to issue the Securities (except as otherwise provided
        in
        this Agreement). 

      

      V.
        REGISTRATION
        RIGHTS 

      

      5.1
        Definitions.
        As used
        in this Agreement, the following terms shall have the following meanings.
        

      

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      (a)
        The
        term “Holder” shall mean any person owning or having the right to acquire
        Registrable Securities or any permitted transferee of a Holder.

      (b)
        The
        terms “register,” “registered” and “registration” refer to a registration
        effected by preparing and filing a registration statement or similar document
        in
        compliance with the Securities Act, and the declaration or order of
        effectiveness of such registration statement or document. 

       

      (c)
        The
        term “Registrable Securities” shall mean: (i) the Common Stock; and (ii) any
        other shares of Common Stock with respect to which the Company has granted
        or
        may in the future grant registration rights pursuant to separate agreements;
        provided, however, that securities shall only be treated as Registrable
        Securities if and only for so long as they (A) have not been disposed of
        pursuant to a registration statement declared effective by the SEC; (B) have
        not
        been sold in a transaction exempt from the registration and prospectus delivery
        requirements of the Securities Act so that all transfer restrictions and
        restrictive legends with respect thereto are removed upon the consummation
        of
        such sale; (C) are held by a Holder or a permitted transferee of a Holder
        pursuant to Section 5.10; and (D) may not be disposed of under Rule 144(k)
        under
        the Securities Act without restriction. 

      

      5.2
        Piggy-Back
        Registration.
        The
        Holders will be entitled to “piggy-back” registration rights of the shares of
        Common Stock on registration statements (other than on Form S-8, S-4 or similar
        Forms) filed by the Company for certain Shares purchase by the Holder
        (“Piggy-Back Rights”). Piggy-back Rights will include the first 15,000 Shares
        purchased by the Holder plus 10% of all additional Shares purchased by the
        Holder. The Company shall use its best efforts to cause such Registration
        Statement to become effective as soon as possible. 

       

      5.3
        Registration
        Procedures.
        Whenever required under this Article V to include Registrable Securities
        in a
        Company registration statement, the Company shall, as expeditiously as
        reasonably possible: 

       

      (a)
        Use
        best efforts to (i) cause such registration statement to become effective,
        and
        (ii) cause such registration statement to remain effective until the earliest
        to
        occur of (A) such date as the sellers of Registrable Securities (the “Selling
        Holders”) have completed the distribution described in the registration
        statement and (B) such time that all of such Registrable Securities are no
        longer, by reason of Rule 144(k) under the Securities Act, required to be
        registered for the sale thereof by such Holders. The Company will also use
        its
        best efforts to, during the period that such registration statement is required
        to be maintained hereunder, file such post-effective amendments and supplements
        thereto as may be required by the Securities Act and the rules and regulations
        thereunder or otherwise to ensure that the registration statement does not
        contain any untrue statement of material fact or omit to state a fact required
        to be stated therein or necessary to make the statements contained therein,
        in
        light of the circumstances under which they are made, not misleading; provided,
        however, that if applicable rules under the Securities Act governing the
        obligation to file a post-effective amendment permits, in lieu of filing
        a
        post-effective amendment that (i) includes any prospectus required by Section
        10(a)(3) of the Securities Act or (ii) reflects facts or events representing
        a
        material or fundamental change in the information set forth in the registration
        statement, the Company may incorporate by reference information required
        to be
        included in (i) and (ii) above to the extent such information is contained
        in
        periodic reports filed pursuant to Section 13 or 15(d) of the Exchange Act
        in
        the registration statement. 

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      (b)
        Prepare and file with the SEC such amendments and supplements to such
        registration statement, and the prospectus used in connection with such
        registration statement, as may be necessary to comply with the provisions
        of the
        Securities Act with respect to the disposition of all securities covered
        by such
        registration statement. 

       

      (c)
        Make
        available for inspection upon reasonable notice during the Company’s regular
        business hours by each Selling Holder, any underwriter participating in any
        distribution pursuant to such registration statement, and any attorney,
        accountant or other agent retained by such Selling Holder or underwriter,
        all
        financial and other records, pertinent corporate documents and properties
        of the
        Company, and cause the Company’s officers, directors and employees to supply all
        information reasonably requested by any such Selling Holder, underwriter,
        attorney, accountant or agent in connection with such registration statement.
        

       

      (d)
        Furnish to the Selling Holders such numbers of copies of a prospectus, including
        a preliminary prospectus as amended or supplemented from time to time, in
        conformity with the requirements of the Securities Act, and such other documents
        as they may reasonably request in order to facilitate the disposition of
        Registrable Securities owned by them. 

       

      (e) Use
        best efforts to register and qualify the securities covered by such registration
        statement under such other federal or state securities laws of such
        jurisdictions as shall be reasonably requested by the Selling Holders; provided,
        however, that the Company shall not be required in connection therewith or
        as a
        condition thereto to qualify to do business or to file a general consent
        to
        service of process in any such states or jurisdictions, unless the Company
        is
        already subject to service in such jurisdiction and except as may be required
        by
        the Securities Act. 

       

      (f) In
        the event of any underwritten public offering, enter into and perform its
        obligations under an underwriting agreement, in usual and customary form,
        with
        the managing underwriter of such offering. Each Selling Holder participating
        in
        such underwriting shall also enter into and perform its obligations under
        such
        an agreement. 

       

      (g) Notify
        each Holder of Registrable Securities covered by such registration statement,
        at
        any time when a prospectus relating thereto is required to be delivered under
        the Securities Act, (i) when the registration statement or any post-effective
        amendment and supplement thereto has become effective; (ii) of the issuance
        by
        the SEC of any stop order or the initiation of proceedings for that purpose
        (in
        which event the Company shall make every effort to obtain the withdrawal
        of any
        order suspending effectiveness of the registration statement at the earliest
        possible time or prevent the entry thereof); (iii) of the receipt by the
        Company
        of any notification with respect to the suspension of the qualification of
        the
        Registrable Securities for sale in any jurisdiction or the initiation of
        any
        proceeding for such purpose; and (iv) of the happening of any event as a
        result
        of which the prospectus included in such registration statement, as then
        in
        effect, includes an untrue statement of a material fact or omits to state
        a
        material fact required to be stated therein or necessary to make the statements
        therein not misleading in the light of the circumstances then existing.

       

      (h)
        Cause
        all such Registrable Securities registered hereunder to be listed on each
        securities exchange or quotation service on which similar securities issued
        by
        the Company are then listed or quoted or, if no such similar securities are
        listed or quoted on a securities exchange or quotation service, apply for
        qualification and use best efforts to qualify such Registrable Securities
        for
        inclusion on the New York Stock Exchange, American Stock Exchange or listing
        on
        a quotation system of the National Association of Securities Dealers, Inc.
        

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      (i) Provide
        a transfer agent and registrar for all Registrable Securities registered
        pursuant hereunder and CUSIP number for all such Registrable Securities,
        in each
        case not later than the effective date of such registration. 

       

      (j) Cooperate
        with the Selling Holders and the managing underwriters, if any, to facilitate
        the timely preparation and delivery of certificates representing the Registrable
        Securities to be sold, which certificates will not bear any restrictive legends;
        and enable such Registrable Securities to be in such denominations and
        registered in such names as the managing underwriters, if any, shall request
        at
        least two business days prior to any sale of the Registrable Securities to
        the
        underwriters. 

       

      (k) In
        connection with an underwritten offering, cause the officers of the Company
        to
        provide reasonable assistance in the preparation of, any “road show”
presentation to potential investors as the managing underwriter may determine.
        

       

      (l) Comply
        with all applicable rules and regulations of the SEC and make generally
        available to its security holders earning statements satisfying the provisions
        of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar
        rule promulgated under the Securities Act) no later than 50 calendar days
        after
        the end of any 3-month period (or 105 calendar days after the end of any
        12-month period if such period is a fiscal year) (i) commencing at the end
        of
        any fiscal quarter in which Registrable Securities are sold to underwriters
        in a
        firm commitment or best efforts underwritten offering, and (ii) if not sold
        to
        underwriters in such an offering, commencing on the first day of the first
        fiscal quarter of the Company, after the effective date of a registration
        statement, which statements shall cover said period. 

       

      (m)
        If
        the offering is underwritten and at the request of any Selling Holder, use
        its
        best efforts to furnish on the date that Registrable Securities are delivered
        to
        the underwriters for sale pursuant to such registration: (i) opinions dated
        such
        date of counsel representing the Company for the purposes of such registration,
        addressed to the underwriters and the transfer agent for the Registrable
        Securities so delivered, respectively, to the effect that such registration
        statement has become effective under the Securities Act and such Registrable
        Securities are freely tradable, and covering such other matters as are
        customarily covered in opinions of issuer’s counsel delivered to underwriters
        and transfer agents in underwritten public offerings and (ii) a letter dated
        such date from the independent public accountants who have certified the
        financial statements of the Company included in the registration statement
        or
        the prospectus, covering such matters as are customarily covered in accountants’
letters delivered to underwriters in underwritten public offerings.

      

      5.4 Furnish
        Information.
        It
        shall be a condition precedent to the obligation of the Company to take any
        action pursuant to this Article V with respect to the Registrable Securities
        of
        any Selling Holder that such Holder shall furnish to the Company such
        information regarding the Holder, the Registrable Securities held by the
        Holder,
        and the intended method of disposition of such securities as shall be reasonably
        required by the Company to effect the registration of such Holder’s Registrable
        Securities. 

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      5.5 Registration
        Expenses.
        The
        Company shall bear and pay all Registration Expenses incurred in connection
        with
        any registration, filing or qualification of Registrable Securities with
        respect
        to registration pursuant to Section 5.2 for each Holder, but excluding
        underwriting discounts and commissions relating to Registrable Securities
        and
        excluding any professional fees or costs of accounting, financial or legal
        advisors to any of the Holders. 

       

      5.6 Underwriting
        Requirements.
        In
        connection with any offering involving an underwriting of shares of the
        Company’s capital stock, the Company shall not be required under Section 5.2 to
        include any of the Holders’ Registrable Securities in such underwriting unless
        they accept the terms of the underwriting as agreed upon between the Company
        and
        the underwriters selected by it (or by other persons entitled to select the
        underwriters), and then only in such quantity as the underwriters determine
        in
        their sole discretion will not jeopardize the success of the offering by
        the
        Company. If the total amount of securities, including Registrable Securities,
        requested by stockholders to be included in such offering exceeds the amount
        of
        securities sold other than by the Company that the underwriters determine
        in
        their sole discretion is compatible with the success of the offering, then
        the
        Company shall be required to include in the offering only that number of
        such
        securities, including Registrable Securities, which the underwriters determine
        in their sole discretion will not jeopardize the success of the offering
        (the
        securities so included to be apportioned pro rata among the selling stockholders
        according to the total amount of securities entitled to be included therein
        owned by each selling stockholder or in such other proportions as shall mutually
        be agreed to by such selling stockholders). For purposes of the preceding
        parenthetical concerning apportionment, for any selling stockholder who is
        a
        holder of Registrable Securities and is a partnership or corporation, the
        partners, retired partners and stockholders of such holder, or the estates
        and
        family members of any such partners and retired partners and any trusts for
        the
        benefit of any of the foregoing persons shall be deemed to be a single “selling
        stockholder,” and any pro-rata reduction with respect to such “selling
        stockholder” shall be based upon the aggregate amount of shares carrying
        registration rights owned by all entities and individuals included in such
        “selling stockholder,” as defined in this sentence. 

       

      5.7 Delay
        of Registration.
        No
        Holder shall have any right to obtain or seek an injunction restraining or
        otherwise delaying any such registration as the result of any controversy
        that
        might arise with respect to the interpretation or implementation of this
        Article. 

       

      5.8 Indemnification.
        In the
        event that any Registrable Securities are included in a registration statement
        under this Article V: 

       

      (a) To
        the extent permitted by law, the Company will indemnify and hold harmless
        each
        Holder, any underwriter (as defined in the Securities Act) for such Holder
        and
        each person, if any, who controls such Holder or underwriter within the meaning
        of the Securities Act or the Exchange Act, against any losses, claims, damages,
        or liabilities (joint or several) to which they may become subject under
        the
        Securities Act, or the Exchange Act, insofar as such losses, claims, damages,
        or
        liabilities (or actions in respect thereof) arise out of or are based upon
        any
        of the following statements, omissions or violations (collectively a
“Violation”): (i) any untrue statement of a material fact contained in such
        registration statement, including any preliminary prospectus or final prospectus
        contained therein or any amendments or supplements thereto, (ii) the omission
        to
        state therein a material fact required to be stated therein, or necessary
        to
        make the statements therein not misleading, or (iii) any violation by the
        Company of the Securities Act, the Exchange Act, or any rule or regulation
        promulgated under the Securities Act, or the Exchange Act, and the Company
        will
        pay to each such Holder, underwriter or controlling person, as incurred,
        any
        legal or other expenses reasonably incurred by them in connection with
        investigating or defending any such loss, claim, damage, liability, or action;
        provided, however, that the indemnity agreement contained in this Section
        5.8(a)
        shall not apply to amounts paid in settlement of any such loss, claim, damage,
        liability, or action if such settlement is effected without the consent of
        the
        Company (which consent shall not be unreasonably withheld), nor shall the
        Company be liable in any such case for any such loss, claim, damage, liability,
        or action to the extent that it arises out of or is based upon a Violation
        which
        occurs in reliance upon and in conformity with written information furnished
        expressly for use in connection with such registration by any such Holder,
        underwriter or controlling person. 

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      (b) To
        the extent permitted by law, each Selling Holder will indemnify and hold
        harmless the Company, each of its directors, each of its officers, each person,
        if any, who controls the Company within the meaning of the Securities Act,
        any
        underwriter, any other Holder selling securities in such registration statement
        and any controlling person of any such underwriter or other Holder, against
        any
        losses, claims, damages, or liabilities (joint or several) to which any of
        the
        foregoing persons may become subject, under the Securities Act, or the Exchange
        Act, insofar as such losses, claims, damages, or liabilities (or actions
        in
        respect thereto) arise out of or are based upon any Violation, in each case
        to
        the extent (and only to the extent) that such Violation occurs in reliance
        upon
        and in conformity with written information furnished by such Holder expressly
        for use in connection with such registration; and each such Holder will pay,
        as
        incurred, any legal or other expenses reasonably incurred by any person intended
        to be indemnified pursuant to this Section 5.8(b), in connection with
        investigating or defending any such loss, claim, damage, liability, or action;
        provided,
        however,
        that
        the indemnity agreement contained in this Section 5.8(b) shall not apply
        to
        amounts paid in settlement of any such loss, claim, damage, liability or
        action
        if such settlement is effected without the consent of the Holder, which consent
        shall not be unreasonably withheld; provided,
        further,
        that,
        in
        no event shall any indemnity under this Section 5.8(b) exceed the greater
        of the
        cash value of the (i) gross proceeds from the Offering received by such Holder
        or (ii) such Holder’s investment pursuant to this Agreement as set forth on the
        signature page attached hereto. 

      

      (c)
        Promptly after receipt by an indemnified party under this Section 5.8
        of
        notice of the commencement of any action (including any governmental action),
        such indemnified party shall, if a claim in respect thereof is to be made
        against any indemnifying party under this Section 5.8, deliver to the
        indemnifying party a written notice of the commencement thereof and the
        indemnifying party shall have the right to participate in, and, to the extent
        the indemnifying party so desires, jointly with any other indemnifying party
        similarly notified, to assume the defense thereof with counsel selected by
        the
        indemnifying party and approved by the indemnified party (whose approval
        shall
        not be unreasonably withheld); provided, however, that an indemnified party
        (together with all other indemnified parties which may be represented without
        conflict by one counsel) shall have the right to retain one separate counsel,
        with the fees and expenses to be paid by the indemnifying party, if
        representation of such indemnified party by the counsel retained by the
        indemnifying party would be inappropriate due to actual or potential differing
        interests between such indemnified party and any other party represented
        by such
        counsel in such proceeding. The failure to deliver written notice to the
        indemnifying party within a reasonable time of the commencement of any such
        action, if prejudicial to its ability to defend such action, shall relieve
        such
        indemnifying party of any liability to the indemnified party under this Section
        5.8, but the omission so to deliver written notice to the indemnifying party
        will not relieve it of any liability that it may have to any indemnified
        party
        otherwise than under this Section 5.8. 

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      (d)
        If
        the indemnification provided for in this Section 5.8 is held by a court of
        competent jurisdiction to be unavailable to an indemnified party with respect
        to
        any loss, liability, claim, damage, or expense referred to therein, then
        the
        indemnifying party, in lieu of indemnifying such indemnified party hereunder,
        shall contribute to the amount paid or payable by such indemnified party
        as a
        result of such loss, liability, claim, damage, or expense in such proportion
        as
        is appropriate to reflect the relative fault of the indemnifying party on
        the
        one hand and of the indemnified party on the other in connection with the
        statements or omissions that resulted in such loss, liability, claim, damage,
        or
        expense as well as any other relevant equitable considerations. The relative
        fault of the indemnifying party and of the indemnified party shall be determined
        by reference to, among other things, whether the untrue or alleged untrue
        statement of a material fact or the alleged omission to state a material
        fact
        relates to information supplied by the indemnifying party or by the indemnified
        party and the parties’ relative intent, knowledge, access to information, and
        opportunity to correct or prevent such statement or omission. 

       

      (e)
        Notwithstanding the foregoing, to the extent that the provisions on
        indemnification and contribution contained in an underwriting agreement entered
        into in connection with an underwritten public offering are in conflict with
        the
        foregoing provisions, the provisions in such underwriting agreement shall
        control. 

      

      (f)
        The
        obligations of the Company and Holders under this Section 5.8 shall survive
        the
        completion of the Offering. 

       

      5.9
        Reports
        Under Securities Exchange Act of 1934.
        With a
        view to making available to the Holders the benefits of Rule 144 and any
        other
        rule or regulation of the SEC that may at any time permit a Holder to sell
        securities of the Company to the public without registration or pursuant
        to a
        registration on Form S-3, the Company agrees to: 

       

      (a)
        make
        and keep public information available, as those terms are understood and
        defined
        in Rule 144, at all times after 90 days after the effective date of the
        registration statement; 

       

      (b)
        file
        with the SEC in a timely manner all reports and other documents required
        of the
        Company under the Securities Act and the Exchange Act; and 

       

      (c)
        furnish to any Holder, so long as the Holder owns any Registrable Securities,
        forthwith upon request (i) a copy of the most recent annual or quarterly
        report
        of the Company and such other reports and documents so filed by the Company,
        and
        (ii) such other information as may be reasonably requested in availing any
        Holder of any rule or regulation of the SEC which permits the selling of
        any
        such securities without registration or pursuant to such form. 

      

      5.10
        Permitted
        Transferees.
        The
        rights to cause the Company to register Registrable Securities granted to
        the
        Holders by the Company under this Article V may be assigned in full by a
        Holder
        in connection with a transfer by such Holder of its Registrable Securities
        if:
        (a) such Holder gives prior written notice to the Company; (b) such transferee
        agrees to comply with the terms and provisions of this Agreement; (c) such
        transfer is otherwise in compliance with this Agreement; and (d) such transfer
        is otherwise effected in accordance with applicable securities laws. Except
        as
        specifically permitted by this Section 5.10, the rights of a Holder with
        respect
        to Registrable Securities as set out herein shall not be transferable to
        any
        other Person, and any attempted transfer shall cause all rights of such Holder
        therein to be forfeited. 

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

      VI.
        LOCK-UP
        AGREEMENT 

       

      6.1 The
        Subscriber understands that the Company may file with the Securities and
        Exchange Commission ("SEC") a registration statement on Form SB-2 (the
        "Registration Statement") to register certain shares of the Company’s common
        stock and to exercise its reasonable best efforts to cause the Registration
        Statement to become effective. The Company may also request a broker-dealer
        to
        file with the National Association of Securities Dealers (the "NASD") to
        secure
        the listing or quotation of its Common Stock on the Over the Counter Bulletin
        Board market maintained by the National Association of Securities Dealers,
        Inc.

       

      6.2 Pursuant
        to Section 5.2 of this Agreement, the Subscriber has been granted piggy-back
        registration rights for the first 15,000 Shares purchased plus 10% of all
        additional Shares purchased in this Offering (the “Registration Shares”). Shares
        that Subscriber purchases in this Offering that do not qualify as Registration
        Shares will be subject to the lock-up provision in Section 6.3 below.

       

      6.3
        As an
        inducement to NASD market makers to establish a public market for the common
        stock, the Subscriber hereby agrees that from the date of the Confidential
        Offering Memorandum and until one (1) year after the Registration Statement
        is
        declared effective by the SEC, the Subscriber will not exercise any rights
        to
        sell any unregistered shares of the Company's Common Stock as may be permitted
        under SEC Rule 144. 

       

      VII.
        MISCELLANEOUS
        

       

      7.1 Any
        notice or other communication given hereunder shall be deemed sufficient
        if in
        writing and sent by registered or certified mail, return receipt requested,
        or
        delivered by hand against written receipt therefor, addressed as follows:
        

       

      if
        to the
        Company, to it at: 

       

      OriginOil,
        Inc.

      2029
        Century Park East, 14th Floor

      Los
        Angeles, CA 90067

      Attn:
        T
        Riggs Eckelberry, Chief Executive Officer

       

      With
        a
        copy to: 

       

      Sichenzia
        Ross Friedman Ference LLP

      61
        Broadway, 32nd
        Floor

      New
        York,
        NY 10006

      Attn:
        Gregory Sichenzia, Esq.

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      if
        to the
        Subscriber, to the Subscriber’s address indicated on the signature page of this
        Agreement. 

       

      Notices
        shall be deemed to have been given or delivered on the date of mailing, except
        notices of change of address, which shall be deemed to have been given or
        delivered when received. 

       

      7.2 Except
        as otherwise provided herein, this Agreement shall not be changed, modified
        or
        amended except by a writing signed by the parties to be charged, and this
        Agreement may not be discharged except by performance in accordance with
        its
        terms or by a writing signed by the party to be charged. 

       

      7.3 Subject
        to the provisions of Section 5.10, this Agreement shall be binding upon and
        inure to the benefit of the parties hereto and to their respective heirs,
        legal
        representatives, successors and assigns. This Agreement sets forth the entire
        agreement and understanding between the parties as to the subject matter
        hereof
        and merges and supersedes all prior discussions, agreements and understandings
        of any and every nature among them. 

       

      7.4 Upon
        the execution and delivery of this Agreement by the Subscriber, this Agreement
        shall become a binding obligation of the Subscriber with respect to the purchase
        of Common Stock as herein provided, subject, however, to the right hereby
        reserved by the Company to enter into the same agreements with other subscribers
        and to add and/or delete other persons as subscribers. 

       

      7.5
        NOTWITHSTANDING THE PLACE WHERE THIS AGREEMENT MAY BE EXECUTED BY ANY OF
        THE
        PARTIES HERETO, THE PARTIES EXPRESSLY AGREE THAT ALL THE TERMS AND PROVISIONS
        HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF
        THE
        STATE OF NEVADA WITHOUT REGARD TO SUCH STATE’S PRINCIPLES OF CONFLICTS OF LAW.
        IN THE EVENT THAT A JUDICIAL PROCEEDING IS NECESSARY, THE SOLE FORUM FOR
        RESOLVING DISPUTES ARISING OUT OF OR RELATING TO THIS AGREEMENT IS THE SUPREME
        COURT OF THE STATE OF NEVADA IN AND FOR CLARK COUNTY OF NEVADA OR THE FEDERAL
        COURTS FOR SUCH STATE AND COUNTY, AND ALL RELATED APPELLATE COURTS, THE PARTIES
        HEREBY IRREVOCABLY CONSENT TO THE JURISDICTION OF SUCH COURTS AND AGREE TO
        SAID
        VENUE. 

       

      7.6
        In
        order to discourage frivolous claims the parties agree that unless a claimant
        in
        any proceeding arising out of this Agreement succeeds in establishing his
        claim
        and recovering a judgment against another party (regardless of whether such
        claimant succeeds against one of the other parties to the action), then the
        other party shall be entitled to recover from such claimant all of its/their
        reasonable legal costs and expenses relating to such proceeding and/or incurred
        in preparation therefor. 

       

      7.7
        The
        holding of any provision of this Agreement to be invalid or unenforceable
        by a
        court of competent jurisdiction shall not affect any other provision of this
        Agreement, which shall remain in full force and effect. If any provision
        of this
        Agreement shall be declared by a court of competent jurisdiction to be invalid,
        illegal or incapable of being enforced in whole or in part, such provision
        shall
        be interpreted so as to remain enforceable to the maximum extent permissible
        consistent with applicable law and the remaining conditions and provisions
        or
        portions thereof shall nevertheless remain in full force and effect and
        enforceable to the extent they are valid, legal and enforceable, and no
        provisions shall be deemed dependent upon any other covenant or provision
        unless
        so expressed herein. 

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

      7.8
        It is
        agreed that a waiver by either party of a breach of any provision of this
        Agreement shall not operate, or be construed, as a waiver of any subsequent
        breach by that same party. 

       

      7.9 The
        parties agree to execute and deliver all such further documents, agreements
        and
        instruments and take such other and further action as may be necessary or
        appropriate to carry out the purposes and intent of this Agreement.

       

      7.10 This
        Agreement may be executed in two or more counterparts each of which shall
        be
        deemed an original, but all of which shall together constitute one and the
        same
        instrument. 

       

      7.11 Nothing
        in this Agreement shall create or be deemed to create any rights in any person
        or entity not a party to this Agreement, except (a) for the holders of
        Registable Securities. 

       

      [REMAINDER
        OF PAGE INTENTIONALLY LEFT BLANK] 

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

      VIII.
        CONFIDENTIAL
        INVESTOR QUESTIONNAIRE 

       

      8.1 The
        Subscriber represents and warrants that he, she or it comes within one category
        marked below, and that for any category marked, he, she or it has truthfully
        set
        forth, where applicable, the factual basis or reason the Subscriber comes
        within
        that category. ALL INFORMATION IN RESPONSE TO THIS SECTION WILL BE KEPT STRICTLY
        CONFIDENTIAL. The undersigned agrees to furnish any additional information
        which
        the Company deems necessary in order to verify the answers set forth below.
        

       

      
        	
                Category
                  A       

              	
                The
                  undersigned is an individual (not a partnership, corporation, etc.)
                  whose
                  individual net worth, or joint net worth with his or her spouse,
                  presently
                  exceeds $1,000,000. 

              
	 	 
	 	
                Explanation.
                  In calculating net worth you may include equity in personal property
                  and
                  real estate, including your principal residence, cash, short-term
                  investments, stock and securities. Equity in personal property
                  and real
                  estate should be based on the fair market value of such property
                  less debt
                  secured by such property. 

              
	 	 
	
                Category
                  B       

              	
                The
                  undersigned is an individual (not a partnership, corporation, etc.)
                  who
                  had an income in excess of $200,000 in each of the two most recent
                  years,
                  or joint income with his or her spouse in excess of $300,000 in
                  each of
                  those years (in each case including foreign income, tax exempt
                  income and
                  full amount of capital gains and losses but excluding any income
                  of other
                  family members and any unrealized capital appreciation) and has
                  a
                  reasonable expectation of reaching the same income level in the
                  current
                  year. 

              
	 	 
	
                Category
                  C       

              	
                The
                  undersigned is a director or executive officer of the Company which
                  is
                  issuing and selling the Securities. 

              
	 	 
	
                Category
                  D       

              	
                The
                  undersigned is a bank; a savings and loan association; insurance
                  company;
                  registered investment company; registered business development
                  company;
                  licensed small business investment company (“SBIC”); or employee benefit
                  plan within the meaning of Title 1 of ERISA and (a) the investment
                  decision is made by a plan fiduciary which is either a bank, savings
                  and
                  loan association, insurance company or registered investment advisor,
                  or
                  (b) the plan has total assets in excess of $5,000,000 or (c) is
                  a self
                  directed plan with investment decisions made solely by persons
                  that are
                  accredited investors. (describe entity) 

              
	 	 
	 	 
	 	 
	
                Category
                  E       

              	
                The
                  undersigned is a private business development company as defined
                  in
                  section 202(a) (22) of the Investment Advisors Act of 1940. (describe
                  entity)

              
	 	 
	 	 

      

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

      

      
        	
                Category
                  F       

              	
                The
                  undersigned is either a corporation, partnership, California or
                  Nevada?
                  business trust, or non-profit organization within the meaning of
                  Section
                  501(c)(3)
                  of the Internal Revenue Code, in each case not formed for the specific
                  purpose of acquiring the Common Stock and with total assets in
                  excess of
                  $5,000,000. (describe entity) 

              
	 	 
	 	 
	 	 
	
                Category
                  G       

              	
                The
                  undersigned is a trust with total assets in excess of $5,000,000,
                  not
                  formed for the specific purpose of acquiring the Securities, where
                  the
                  purchase is directed by a “sophisticated investor” as defined in
                  Regulation 506(b)(2)(ii) under the Act. 

              
	 	 
	
                Category
                  H       

              	
                The
                  undersigned is an entity (other than a trust) in which all of the
                  equity
                  owners are “accredited investors” within one or more of the above
                  categories. 

              
	 	 
	 	 

      

      

      The
        undersigned agrees that the undersigned will notify the Company at any time
        on
        or prior to the Closing Date in the event that the representations and
        warranties in this Agreement shall cease to be true, accurate and complete.
        

       

      8.2
        SUITABILITY(please
        answer each question) 

       

      (a)
        For
        an individual Subscriber, please describe your current employment, including
        the
        company by which you are employed and its principal business: 

      
        	 
	 
	 
	 

      

      

      (b)
        For
        an individual Subscriber, please describe any college or graduate degrees
        held
        by you:
        

      
        	 
	 
	 
	 

      

      

      (c)
        For
        all Subscribers, please list types of prior investments:

      
        	 
	 
	 
	 

      

      

      (d)
        For
        all Subscribers, please state whether you have participated in other private
        placements before:

      

      YES_______                            NO_______

      Initials_____
        

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

      

      (e)
        If
        your answer to question (d) above was “YES”, please indicate frequency of such
        prior participation in private
        placementsof:
        

      

      
        	 	
                Public
                  

                Companies

              	
              	 	
                Private
                  

                Companies

              	
              
	
                Frequently

              	 	 	 
	
                Occasionally

              	 	 	 
	
                Never

              	 	 	 

      

      

      (f)
        For
        individual Subscribers, do you expect your current level of income to
        significantly decrease in the foreseeable future: 

      

      YES_______                            NO_______
        

      

      (g)
        For
        trust, corporate, partnership and other institutional Subscribers, do you
        expect
        your total assets to significantly decrease in the foreseeable future:

      

      YES_______                            NO_______
        

      

      (h)
        For
        all Subscribers, do you have any other investments or contingent liabilities
        which you reasonably anticipate could cause you to need sudden cash requirements
        in excess of cash readily available to you: 

      

      YES_______                            NO_______
        

      

      (i)
        For
        all Subscribers, are you familiar with the risk aspects and the non-liquidity
        of
        investments such as the securities for which you seek to subscribe?

      

      YES_______                            NO_______
        

      

      (j)
        For
        all Subscribers, do you understand that there is no guarantee of financial
        return on this investment and that you run the risk of losing your entire
        investment? 

      

      YES_______                            NO_______
        

       

      8.3
        MANNER
        IN WHICH TITLE IS TO BE HELD.
        (circle
        one) 

       

      (a)
        Individual Ownership 

      (b)
        Community Property 

      (c)
        Joint
        Tenant with Right of Survivorship (both parties must sign) 

      (d)
        Partnership* 

      (e)
        Tenants in Common 

      (f)
        Company* 

      (g)
        Trust* 

      (h)
        Other* 

      

      *If
        Securities are being subscribed for by an entity, the attached Certificate
        of
        Signatory must also be completed. 

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

      

      
        	
                8.4
                  NASD AFFILIATION. 

              	
                Initials_____

              

      

       

      Are
        you
        affiliated or associated with an NASD member firm (please check one):

       

      Yes
        _________                         
No __________ 

       

      If
        Yes,
        please describe: 

       

        
          

        

        
           

          
            

          

          
             

            
              

            

             

          

        

      

      *If
        Subscriber is a Registered Representative with an NASD member firm, have
        the
        following acknowledgment signed by the appropriate party: 

       

      The
        undersigned NASD member firm acknowledges receipt of the notice required
        by
        Article 3, Sections 28(a) and (b) of the Rules of Fair Practice. 

      
        	
                 

              
	
                Name
                  of NASD Member Firm

              
	 
	
                By:

              	 
	
                Authorized
                  Officer

              
	 
	
                Date:

              	 

      

       

      8.5
        The
        undersigned is informed of the significance to the Company of the foregoing
        representations and answers contained in the Confidential Investor Questionnaire
        contained in this Article VII and such answers have been provided under the
        assumption that the Company will rely on them. 

       

      [REMAINDER
        OF PAGE INTENTIONALLY LEFT BLANK] 

      

      Initials_____
        

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

      

      NUMBER
        OF SHARES __________ X $0.10 = $__________ (the “Purchase Price”)

       

      
        	 	 	 
	
                Signature
                  

              	 	
                Signature
                  (if purchasing jointly) 

              
	 	 	 
	
                Name
                  Typed or Printed 

              	 	
                Name
                  Typed or Printed 

              
	 	 	 
	
                Title
                  (if Subscriber is an Entity) 

              	 	
                Title
                  (if Subscriber is an Entity) 

              
	 	 	 
	
                Entity
                  Name (if applicable) 

              	 	
                Entity
                  Name (if applicable 

              
	 	 	 
	 	 	 
	
                Address
                  

              	 	
                Address
                  

              
	 	 	 
	
                City,
                  State and Zip Code 

              	 	
                City,
                  State and Zip Code 

              
	 	 	 
	
                Telephone-Residence
                  

              	 	
                Telephone-Residence
                  

              
	 	 	 
	
                Facsimile-Residence
                  

              	 	
                Facsimile-Residence
                  

              
	 	 	 
	
                Telephone-Business
                  

              	 	
                Telephone-Business
                  

              
	 	 	 
	
                Facsimile-Business
                  

              	 	
                Facsimile-Business
                  

              
	 	 	 
	
                Email
                  

              	 	
                Email
                  

              
	 	 	 
	
                Tax
                  ID # or Social Security # 

              	 	
                Tax
                  ID # or Social Security # 

              

      

       

      
        	Name in which securities should be issued:	 

      

       

      Dated:
        ______________, 2007 

       

      This
        Subscription Agreement is agreed to and accepted as of ________________ ,
        2007.

      

      
        	
                OriginOil,
                  Inc.

              
	 	 
	
                By:

              	 
	
                Name:

              	
                T
                  Riggs Eckelberry

              
	
                Title:

              	
                President
                  and CEO

              

      

       

      Initials_____
        

       

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

      CERTIFICATE
        OF SIGNATORY 

       

      (To
        be
        completed if Shares are 

      being
        subscribed for by an entity) 

      

      I,
        ____________________________, am the ____________________________ of
        __________________________________________ (the “Entity”). 

       

      I
        certify
        that I am empowered and duly authorized by the Entity to execute and carry
        out
        the terms of the Subscription Agreement and to purchase and hold the Common
        Stock, and certify further that the Subscription Agreement has been duly
        and
        validly executed on behalf of the Entity and constitutes a legal and binding
        obligation of the Entity. 

       

      IN
        WITNESS WHEREOF, I have set my hand this ________ day of _________________,
        2007

       

      
        	 	 
	
                (Signature)

              	 

      

       

      Initials_____
        

       

      
        
          
          

        

        
          23

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