Document:

ex10-9.htm

    
      Exhibit
10.9

       

      GREENMAN
TECHNOLOGIES, INC.

       

      2005 STOCK OPTION
PLAN

       

      (As amended April 2,
2008)

       

      1.    Purpose. This 2005 Stock Option Plan
(the "Plan") is intended to provide incentives: (a) to the officers and other
employees of GreenMan Technologies, Inc., a Delaware corporation (the
"Company"), its parent (if any) and any present or future subsidiaries of the
Company (collectively, "Related Corporations") by providing them with
opportunities to purchase stock in the Company pursuant to options granted
hereunder which qualify as "incentive stock options" under Section 422(b) of the
Internal Revenue Code of 1986, as amended (the "Code") ("ISO" or "ISOs"); and
(b) to directors, officers, employees and consultants of the Company and Related
Corporations by providing them with opportunities to purchase stock in the
Company pursuant to options granted hereunder which do not qualify as ISOs
("Non-Qualified Option" or "Non-Qualified Options"). As used herein, the terms
"parent" and "subsidiary" mean "parent corporation" and "subsidiary
corporation", respectively, as those terms are defined in Section 424 of the
Code.

       

      2.    Administration of the
Plan

       

      A.    Board or
Committee Administration. The Plan shall be
administered by the Board of Directors of the Company (the "Board") or by a
Committee appointed by the Board pursuant to Section 2B of the Plan.
Hereinafter, all references in this Plan to the "Committee" shall mean the Board
if no Committee has been appointed. Subject to ratification of the grant or
authorization of each Option by the Board (if so required by applicable state
law), and subject to the terms of the Plan, the Committee shall have the
authority to (i) determine the employees of the Company and Related Corporations
(from among the class of employees eligible under paragraph 3 to receive ISOs)
to whom ISOs may be granted, and to determine (from among the class of
individuals and entities eligible under paragraph 3 to receive Non-Qualified
Options) to whom Non-Qualified Options may be granted; (ii) determine the time
or times at which Options may be granted; (iii) determine the option price of
shares subject to each Option, which price shall not be less than the minimum
price specified in paragraph 6; (iv) determine, with respect to each Option
granted under the Plan, whether such Option shall be an ISO or a Non-Qualified
Option; (v) determine (subject to paragraph 7) the time or times when each
Option shall become exercisable and the duration of the exercise period; (vi)
determine whether restrictions such as repurchase options are to be imposed on
shares subject to Options and the nature of such restrictions, if any, and (vii)
interpret the Plan and prescribe and rescind rules and regulations relating to
it. If the Committee determines to issue a Non-Qualified Option, it shall take
whatever actions it deems necessary, under Section 422 of the Code and the
regulations promulgated thereunder, to ensure that such Option is not treated as
an ISO. If the Committee determines to issue an ISO, it shall take whatever
actions it deems necessary, under Section 422 of the Code and the regulations
promulgated thereunder, to ensure that such Option is not treated as a
Non-Qualified Option. The interpretation and construction by the Committee of
any provisions of the Plan or of any Option granted under it shall be final
unless otherwise determined by the Board. The Committee may from time to time
adopt such rules and regulations for carrying out the Plan as it may deem best.
No member of the Board or the Committee shall be liable for any action or
determination made in good faith with respect to the Plan or any Option granted
under it.

       

      
        
           

        

        
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      B.    The
Board may delegate administration of the Plan to a Committee composed of not
fewer than two (2) Directors (the "Committee"), each of the members of which
Committee shall be (i) a Non-Employee Director (as such term is defined in Rule
16b-3(b)(3)(i)) and (ii) an “outside director” (within the meaning of such term
Section 1562(m) of the Code. If administration is delegated to a Committee, the
Committee shall have, in connection with the administration of the Plan, the
powers theretofore possessed by the Board, subject, however, to such
resolutions, not inconsistent with the provisions of the Plan, as may be adopted
form time to time by the Board.

       

      C.    Any
requirement that each member of the Committee be a "Non-Employee Director" shall
not apply (i) after the date the Company ceases to have any class of equity
security registered under Section 12 of the Securities Exchange Act of 1934, as
amended, or (ii) if the Board expressly declares that such requirement shall not
apply.

       

      3.    Eligible
Employees and Others.  ISOs may be
granted to any employee of the Company or any Related Corporation. Those
officers and directors of the Company who are not employees may not be granted
ISOs under the Plan. Non-Qualified Options may he granted to any employee,
officer or director (including Non-Employee Directors) or consultant of the
Company or any Related Corporation. The Committee may take into consideration a
recipient's individual circumstances in determining whether to grant an ISO or a
Non-Qualified Option. Granting of any Options to any individual or entity shall
neither entitle that individual or entity to, nor disqualify him from,
participation in any other grants of Options.

       

      4.    Stock. The stock subject to Options
shall be authorized but unissued shares of Common Stock of the Company, par
value $.01 per share (the "Common Stock"), or shares of Common Stock reacquired
by the Company in any manner. The aggregate number of shares which may be issued
pursuant to the Plan is 3,500,000, subject to adjustment as provided in
paragraph 13. Any such shares may be issued as ISOs or Non-Qualified Options so
long as the number of shares so issued does not exceed such number, as adjusted.
If any Option granted under the Plan shall expire or terminate for any reason
without having been exercised in full or shall cease for any reason to be
exercisable in whole or in part, the unpurchased shares subject to such Options
shall again be available for grants of Option under the Plan. The number of
shares of Common Stock in respect of which an optionee may receive Options under
the Plan in any year shall not exceed 500,000, subject to adjustment as provided
in paragraph 13.

       

      5.    Granting
of Options.
Options may be granted under the Plan at any time after March 18, 2005 and prior
to March 18, 2015. The date of grant of Options under the Plan will be the date
specified by the Committee at the time it grants the Option; provided, however,
that such date shall not be prior to the date on which the Committee acts to
approve the grant. The Committee shall have the right, with the consent of the
optionee, to convert an ISO granted under the Plan to a Non-Qualified Option
pursuant to paragraph 16.

       

      6.    Minimum Option Price; ISO
Limitation

       

      A.    Price for
Non-Qualified Options. The exercise price per share
specified in the agreement relating to each Non-Qualified Option granted under
the Plan shall in no event be less than the minimum legal consideration required
therefor under the laws of the State of Delaware or the laws of any jurisdiction
in which the Company or its successors in interest may be
organized.

       

      
        
           

        

        
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      B.    Price for
ISOs. The
exercise price per share specified in the agreement relating to each ISO granted
under the Plan shall not be less than the fair market
value per share of Common Stock on the date of such grant. In the case of an ISO
to be granted to an employee owning stock possessing more than ten percent (10%)
of the total combined voting power of all classes of stock of the Company or any
Related Corporation, the price per share specified in the agreement relating to
such ISO shall not be less than one hundred ten percent (110%) of the fair
market value per share of Common Stock on the date of grant.

       

      C.    $100,000
Annual Limitation on ISOs. Each eligible employee may
be granted ISOs only to the extent that, in the aggregate under this Plan and
all incentive stock option plans of the Company and any Related Corporation, the
value of Common Stock (determined at the time ISOs were granted) which is
subject to ISOs that become exercisable for the first time by such employee
during any calendar year does not exceed $100,000. Any options granted to an
employee in excess of such amount will be granted as Non-Qualified
Options.

       

      D.    Determination
of Fair Value Market. If, at the time an Option is
granted under the Plan, the Company's Common Stock is publicly traded, "fair
market value" shall be determined as of the last business day for which the
prices or quotes discussed in this sentence are available prior to the date such
Option is granted and shall mean (i) the average (on that date) of the high and
low prices of the Common Stock on the principal national securities exchange on
which the Common Stock is traded, if the Common Stock is then traded on a
national securities exchange; or (ii) the last reported sale price (on that
date) of the Common Stock on the Nasdaq National Market (or successor trading
system), if the Common Stock is not then traded on a national securities
exchange; or (iii) the closing bid price (or average of bid prices) last quoted
(on that date) by an established quotation service for over-the-counter
securities, if the Common Stock is not reported on the NASDAQ National Market
(or successor trading system). However, if the Common Stock is not publicly
traded at the time an Option is granted under the Plan, "fair market value"
shall be deemed to be the fair value of the Common Stock as determined by the
Committee after taking into consideration all factors which it deems
appropriate, including, without limitation, recent sale and offer prices of the
Common Stock in private transactions negotiated at arm's length.

       

      7.    Option
Duration. Subject
to earlier termination as provided in paragraphs 9 and 10, each Option shall
expire on the date specified by the Committee, but not more than (i) ten years
and one day from the date of grant in the case of Non-Qualified Options, (ii)
ten years from the date of grant in the case of ISOs generally, and (iii) five
years from the date of grant in the case of ISOs granted to an employee owning
stock possessing more than ten percent (10%) of the total combined voting power
of all classes of stock of the Company or any Related Corporation. Subject to
earlier termination as provided in paragraphs 9 and 10, the term of each ISO
shall be the term set forth in the original instrument granting such ISO, except
with respect to any part of such ISO that is converted into a Non-Qualified
Option pursuant to paragraph 16.

       

      8.    Exercise
of Option.
Subject to the provisions of paragraphs 9 through 12, each Option granted
under the Plan shall be exercisable as follows:

       

      A.    Vesting. The Option shall either be
fully exercisable on the date of grant or shall become exercisable thereafter in
such installments as the Committee may specify.

       

      
        
           

        

        
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      B.    Full
Vesting of Installments. Once an installment becomes
exercisable it shall remain exercisable until expiration or termination of the
Option, unless otherwise specified by the Committee.

       

      C.    Partial
Exercise. Each
Option or installment may be exercised at any time or from time to time, in
whole or in part, for up to the total number of shares with respect to which it
is then exercisable.

       

      D.    Acceleration
of Vesting. The
Committee shall have the right to accelerate the date of exercise of any
installment of any Option; provided that the Committee shall not, without the
consent of an optionee, accelerate the exercise date of any installment of any
Option granted to any employee as an ISO (and not previously converted into a
Non-Qualified Option pursuant to paragraph 16) if such acceleration would
violate the annual vesting limitation contained in Section 422(d) of the Code,
as described in paragraph 6(C).

       

      E.    Extension
of Exercise Period. Notwithstanding any
provision herein to the contrary, the Committee may, in its discretion, extend
the exercise period with respect to any Non-Qualified Option.

       

      9.    Termination
of Employment. If
an ISO optionee ceases to be employed by the Company and all Related
Corporations other than by reason of death or disability as defined in paragraph
10, no further installments of his ISOs shall become exercisable, and his ISOs
shall terminate after the passage of ninety (90) days from the date of
termination of his employment (or at such earlier date as may be specified in
the optionee’s option agreement), but in no event later than on their specified
expiration dates, except to the extent that such ISOs (or unexercised
installments thereof) have been converted into Non-Qualified Options pursuant to
paragraph 16. Employment shall be considered as continuing
uninterrupted during any bona fide leave of absence (such as those attributable
to illness, military obligations or governmental service) provided that the
period of such leave does not exceed ninety (90) days or, if longer, any period
during which such optionee's right to reemployment is guaranteed by statute. A
bona fide leave of absence with the written approval of the Committee shall not
be considered an interruption of employment under the Plan, provided that such
written approval contractually obligates the Company or any Related Corporation
to continue the employment of the optionee after the approved period of absence.
ISOs granted under the Plan shall not be affected by any change of employment
within or among the Company and Related Corporations, so long as the optionee
continues to be an employee of the Company or any Related Corporation. Nothing
in the Plan shall be deemed to give any grantee of any Option the right to be
retained in employment or other service by the Company or any Related
Corporation for any period of time.

       

      10.    Death;
Disability

       

      A.    Death. If an ISO optionee ceases to
be employed by the Company and all Related Corporations by reason of his death,
any ISO of his may be exercised, to the extent of the number of shares with
respect to which he could have exercised it on the date of his death, by his
estate, personal representative or beneficiary who has acquired the ISO by will
or by the laws of
descent and distribution, at any time prior to the earlier of the specified
expiration date of the ISO or 180 days from the date of the optionee's
death.

       

      
        
           

        

        
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      B.    Disability. If an ISO optionee ceases to
be employed by the Company and all Related Corporations by reason of his
disability, he shall have the right to exercise any ISO held by him on the date
of termination of employment, to the extent of the number of shares with respect
to which he could have exercised it on that date, at any time prior to the
earlier of the specified expiration date of the ISO or 180 days from the date of
the termination of the optionee's employment. For the purposes of the Plan, the
term "disability" shall mean "permanent and total disability" as defined in
Section 22(e)(3) of the Code or successor statute.

       

      11.    Assignability. No Option shall be
assignable or transferable by the optionee except by will or by the laws of
descent and distribution or, with respect to Non-Qualified Options only,
pursuant to a qualified domestic relations order as defined in the Code or Title
I of the Employee Retirement Income Security Act, or the rules thereunder.
During the lifetime of the optionee each ISO shall be exercisable only by
him.  Any assignment or transfer, or attempted assignment or transfer,
of an Option in violation of this Section 11 shall be void.

       

      12.    Terms and Conditions of Options. Options shall be evidenced
by instruments (which need not be identical) in such forms as the Committee may
from time to time approve. Such instruments shall conform to the terms and
conditions set forth in paragraphs 6 through 11 hereof and may contain such
other provisions as the Committee deems advisable which are not inconsistent with
the Plan, including restrictions applicable to shares of Common Stock issuable
upon exercise of Options. In granting any Non-Qualified Option, the Committee
may specify that such Non-Qualified option shall be subject to the restrictions
set forth herein with respect to ISOs, or to such other termination and
cancellation provisions as the Committee may determine. The Committee may from
time to time confer authority and responsibility on one or more of its own
members and/or one or more officers of the Company to execute and deliver such
instruments. The proper officers of the Company are authorized and directed to
take any and all action necessary or advisable from time to time to carry out
the terms of such instruments.

       

      13.    Adjustments. Upon the occurrence of any
of the following events, an optionee's rights with respect to Options granted to
him hereunder shall be adjusted as hereinafter provided, unless otherwise
specifically provided in the written agreement between the optionee and the
Company relating to such Option:

       

      A.    Stock
Dividends and Stock Splits. If the shares of Common
Stock shall be subdivided or combined into a greater or smaller number of shares
or if the Company shall issue any shares of Common Stock as a stock dividend on its
outstanding Common Stock, the number of shares of Common Stock deliverable upon
the exercise of Options shall be appropriately increased or decreased
proportionately, and appropriate adjustments shall be made in the purchase price
per share to reflect such subdivision, combination or stock
dividend.

       

      
        
           

        

        
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      B.    Consolidation
or Mergers. If the Company is to be
consolidated with or acquired by another entity in a merger, sale of all or
substantially all of the Company's assets or otherwise (an "Acquisition"), the
Committee or the board of directors of any entity assuming the obligations of
the Company hereunder (the "Successor Board"), shall, as to outstanding Options,
either (i) make appropriate provision for the continuation of such Options by
substituting on an equitable basis for the shares then subject to such Options
the consideration payable with respect to the outstanding shares of Common Stock
in connection with the Acquisition; or (ii) make appropriate provisions for the
continuation of such Options by substituting on an equitable basis for the
shares then subject to such Options any equity securities of the successor
corporation; or (iii) upon written notice to the optionees, provide that all
Options must be exercised, to the extent then exercisable, within a specified
number of days of the date of such notice, at the end of which period the
Options shall terminate; or (iv) terminate all Options in exchange for a cash
payment equal to the excess of the fair market value
of the shares subject to such Options (to the extent then exercisable) over the
exercise price thereof; or (v) accelerate the date of exercise of such Options
or of any installment of such Options; or (vi) terminate all Options in exchange
for the right to participate in any stock option or other employee benefit plan
of any successor corporation.

       

      C.    Recapitalization
or Reorganization. In the event of a
recapitalization or reorganization of the Company (other than a transaction
described in subparagraph B above) pursuant to which securities of the Company
or of another corporation are issued with respect to the outstanding shares of
Common stock, an optionee upon exercising an Option shall be entitled to receive
for the purchase price paid upon such exercise the securities he would have
received if he had exercised his Option prior to such recapitalization or
reorganization.

       

      D.    Modifications
of ISOs.
Notwithstanding the foregoing, any adjustments made pursuant to
subparagraphs A, B or C with respect to ISOs shall be made only after the
Committee, after consulting with counsel for the Company, determines whether
such adjustments would constitute a "modification" of such ISOs (as that term is
defined in Section 424 of the Code) or would cause any adverse tax consequences
for the holders of such ISOs. If the Committee determines that such adjustments
made with respect to ISOs would constitute a modification of such ISOs, it may
refrain from making such adjustments.

       

      E.    Dissolution
or Liquidation. In the event of the
proposed dissolution or liquidation of the Company, each Option will terminate
immediately prior to the consummation of such proposed action or at such other
time and subject to such other conditions as shall be determined by the
Committee.

       

      F.    Issuances
of Securities.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities-
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of shares
subject to Options. No adjustments shall be made for dividends paid in cash or
in property other than securities of the Company.

       

      G.    Fractional
Shares. No
fractional shares shall be issued under the Plan and the optionee shall receive
from the Company cash in lieu of such fractional shares.

       

      
        
           

        

        
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      H.    Adjustments. Upon the happening of any of
the events described in subparagraphs A, B or C above, the class and aggregate
number of shares set forth in paragraph 4 hereof that are subject to Options
which previously have been or subsequently may be granted under the Plan, and
the number of shares of Common Stock in respect of which an optionee may receive
Options under the Plan in any year, shall also be appropriately adjusted to
reflect the events described in such subparagraphs. The Committee or the
Successor Board shall determine the specific adjustments to be made under this
paragraph 13 and, subject to paragraph 2, its determination shall be
conclusive.

       

      If
any person or entity owning restricted Common Stock obtained by exercise of an
Option made hereunder receives shares or securities or cash in connection with a
corporate transaction described in subparagraphs A, B or C above as a result of
owning such restricted Common Stock, such shares or securities or cash shall be
subject to all of the conditions and restrictions applicable to the restricted
Common Stock with respect to which such shares or securities or cash were
issued, unless otherwise determined by the Committee or the Successor
Board.

       

      14.    Means of
Exercising Options. An Option (or any part or
installment thereof) shall be exercised by giving written notice to the Company
at its principal office address. Such notice shall identify the Option being
exercised and specify the number of shares as to which such Option is being
exercised, accompanied by full payment of the purchase price therefor either (a)
in United States dollars in cash or by check, or (b) at the discretion of the
Committee, through delivery of shares of Common Stock having a fair market value
equal as of the date of the exercise to the cash exercise price of the Option,
(c) at the discretion of the Committee and consistent with applicable law,
through the delivery of an assignment to the Company of a sufficient amount of
the proceeds from the sale of the Common Stock acquired upon exercise of the
Option and an authorization to the broker, or selling agent to pay that amount
to the Company, which sale shall be at the participant's direction at the time
of exercise, or (d) at the discretion of the Committee, by any combination of
(a), (b) and (c) above. If the Committee exercises its discretion to permit
payment of the exercise price of an ISO by means of the methods set forth in
clauses (b), (c) or (d) of the preceding sentence, such discretion shall be
exercised in writing at the time of the grant of the ISO in question. The holder
of an Option shall not have the rights of a shareholder with respect to the
shares covered by his Option until the date of issuance of a stock certificate
to him for such shares. Except as expressly provided above in paragraph 13 with
respect to changes in capitalization and stock dividends, no adjustment shall be
made for dividends or similar rights for which the record date is before the
date such stock certificate is issued.

       

      15.    Terms and
Amendment of Plan.
This Plan was adopted by the Board on March 18, 2005 subject to approval
of the Plan by the stockholders of the Company at the next Meeting of
Stockholders or, in lieu thereof, by written consent. If the approval of
stockholders is not obtained prior to March 18, 2006, any grants of ISOs under
the Plan made prior to that date will be rescinded. The Plan shall expire at the
end of the day on March 18, 2015 (except as to Options outstanding on that
date).  Subject to the provisions of paragraph 5 above, Options may be
granted under the Plan prior to the date of stockholder approval of the Plan.
The Board may terminate or amend the Plan in any respect at any time, except
that, without the approval of the stockholders obtained within 12 months before
or after the Board
adopts a resolution authorizing any of the following actions: (a) the total
number of shares that may be issued under the Plan may not
be materially increased (except by adjustment pursuant to paragraph 13); (b) the
provisions of paragraph 3 regarding eligibility for grants of ISOs may not be
modified; (c) the provisions of paragraph 6(B) regarding the exercise price at
which shares may be offered pursuant to ISOs may not be modified (except by
adjustment pursuant to paragraph 13); and (d) the expiration date of the Plan
may not be extended. Except as otherwise provided in this paragraph 15, in no
event may action of the Board or stockholders alter or impair she rights of a
grantee, without his consent, under any Option previously granted to
him.

       

      
        
           

        

        
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      16.    Conversion
of ISOs into Non-Qualified Options; Termination of ISOs. The Committee, at the
written request of any optionee, may in its discretion take such actions as may
be necessary to convert such optionee's ISOs (or any installments or portions of
installments thereof) that have not been exercised on the date of conversion
into Non-Qualified Options at any time prior to the expiration of such ISOs,
regardless of whether the optionee is an employee of the Company or a Related
Corporation at the time of such conversion. Such actions may include, but not be
limited to, extending the exercise period or reducing the exercise price of the
appropriate installments of such ISOs. At the time of such conversion, the
Committee (with the consent of the optionee) may impose such conditions on the
exercise of the resulting Non-Qualified Options as the Committee in its
discretion may determine, provided that such conditions shall not be
inconsistent with this Plan. Nothing in the Plan shall be deemed to give any
optionee the right to have such optionee's ISOs converted into Non-Qualified
Options, and no such conversion shall occur until and unless the Committee takes
appropriate action. The Committee, with the consent of the optionee, may also
terminate any portion of any ISO that has not been exercised at the time of such
termination.

       

      17.    Application
of Funds. The
proceeds received by the Company from the sale of shares pursuant to Options
granted under the Plan shall be used for general corporate
purposes.

       

      18.    Governmental
Regulation. The
Company's obligation to sell and deliver shares of the Common Stock under this
Plan is subject to the approval of any governmental authority required in
connection with the authorization, issuance or sale of
such shares.

       

      19.    Withholding
of Additional Income Taxes. Upon the exercise of a
Non-Qualified Option or the making of a Disqualifying Disposition (as defined in
paragraph 20), the Company, in accordance with Section 3402(a) of the Code, may
require the optionee to remit to the Company additional withholding taxes in
respect of the amount that is considered compensation includible in such
person's gross income. The Committee in its discretion may condition the
exercise of an option on the grantee's remission of such additional withholding
taxes.

       

      20.    Notice to
Company of Disqualifying Disposition. Each employee who receives
an ISO must agree to notify the Company in writing immediately after the
employee makes a Disqualifying Disposition of any Common Stock acquired pursuant
to the exercise of an ISO. A Disqualifying Disposition is any disposition
(including any sale) of such Common Stock before the later of (a) two years
after the date the employee was granted the ISO, or (b) one year after the date
the employee acquired Common Stock by exercising the ISO. If the employee has
died before such stock is sold, these holding period requirements do not apply
and no Disqualifying Disposition can occur thereafter.

       

      21.    Governing
Law; Construction.
The validity and construction of the Plan and the instruments evidencing
Options shall be governed by the laws of the State of Delaware, or the laws of
any jurisdiction in which the Company or its successors in interest may be
organized. In construing this Plan, the singular shall include the plural and
the masculine gender shall include the feminine and neuter, unless the context
otherwise requires.

      

       

      
        
           

        

        
          8Exhibit 4.1

Exhibit 4.1

ALBERTA STAR DEVELOPMENT CORP.

STOCK OPTION PLAN

1.

Purpose

The purpose of the Stock Option Plan (the “Plan”) of ALBERTA STAR DEVELOPMENT CORP., a corporation incorporated under the Business Corporations Act (Alberta) (the “Corporation”) is to advance the interests of the Corporation by encouraging the directors, officers, employees and consultants of the Corporation, and of its subsidiaries and affiliates, if any, to acquire common shares in the share capital of the Corporation (the “Shares”), thereby increasing their proprietary interest in the Corporation, encouraging them to remain associated with the Corporation and furnishing them with additional incentive in their efforts on behalf of the Corporation in the conduct of its affairs.

2.

Administration

The Plan shall be administered by the Board of Directors of the Corporation or by a special committee of the directors appointed from time to time by the Board of Directors of the Corporation pursuant to rules of procedure fixed by the Board of Directors (such committee or, if no such committee is appointed, the Board of Directors of the Corporation, is hereinafter referred to as the “Board”).  A majority of the Board shall constitute a quorum, and the acts of a majority of the directors present at any meeting at which a quorum is present, or acts unanimously approved in writing, shall be the acts of the directors.

Subject to the provisions of the Plan, the Board shall have authority to construe and interpret the Plan and all option agreements entered into thereunder, to define the terms used in the Plan and in all option agreements entered into thereunder, to prescribe, amend and rescind rules and regulations relating to the Plan and to make all other determinations necessary or advisable for the administration of the Plan.  All determinations and interpretations made by the Board shall be binding and conclusive on all participants in the Plan and on their legal personal representatives and beneficiaries.

Each option granted hereunder may be evidenced by an agreement in writing, signed on behalf of the Corporation and by the optionee, in such form as the Board shall approve.  Each such agreement shall recite that it is subject to the provisions of this Plan.

3.

Stock Exchange Rules

All options granted pursuant to this Plan shall be subject to rules and policies of any stock exchange or exchanges on which the common shares of the Corporation are then listed and any other regulatory body having jurisdiction hereinafter (hereinafter collectively referred to as, the “Exchange”).

4.

Shares Subject to Plan

Subject to adjustment as provided in Section 16 hereof, the Shares to be offered under the Plan shall consist of common shares of the Corporation’s authorized but unissued common shares.  The aggregate number of Shares issuable upon the exercise of all options granted under the Plan shall not exceed 10% of the issued and outstanding common shares of the Corporation from time to time.  If any option granted hereunder shall expire or terminate for any reason in accordance with the terms of the Plan without being exercised, the unpurchased Shares subject thereto shall again be available for the purpose of this Plan.

5.

Maintenance of Sufficient Capital

The Corporation shall at all times during the term of the Plan reserve and keep available such numbers of Shares as will be sufficient to satisfy the requirements of the Plan.

126

6.

Eligibility and Participation

Directors, officers, consultants, and employees of the Corporation or its subsidiaries, and employees of person or company which provides management services to the Corporation or is subsidiaries (“Management Company Employees”) shall be eligible for selection to participate in the Plan (such persons hereinafter collectively referred to as “Participants”).  Subject to compliance with applicable requirements of the Exchange, Participants may elect to hold options granted to them in an incorporated entity wholly owned by them and such entity shall be bound by the Plan in the same manner as if the options were held by the Participant.

Subject to the terms hereof, the Board shall determine to whom options shall be granted, the terms and provisions of the respective option agreements, the time or times at which such options shall be granted and vested, and the number of Shares to be subject to each option.  In the case of employees or consultants of the Corporation or Management Company Employees, the option agreements to which they are party must contain a representation of the Corporation that such employee, consultant or Management Company Employee, as the case may be, is a bona fide employee, consultant or Management Company Employee of the Corporation or its subsidiaries.

A Participant who has been granted an option may, if such Participant is otherwise eligible, and if permitted under the policies of the Exchange, be granted an additional option or options it the Board shall so determine.

7.

Exercise Price

(a)

The exercise price of the shares subject to each option shall be determined by the Board, subject to applicable Exchange approval, at the time any option is granted.  In no event shall such exercise price be lower than the exercise price permitted by the Exchange.

(b)

Once the exercise price has been determined by the Board, accepted by the Exchange and the option has been granted, the exercise price of an option may be reduced upon receipt of Board approval, provided that in the case of options held by insiders of the Corporation (as defined in the policies of the Exchange), the exercise price of an option may be reduced only if disinterested shareholder approval is obtained.

8.

Number of Optioned Shares

(a)

The number of Shares subject to an option granted to any one Participant shall be determined by the Board, but no one Participant shall be granted an option which exceeds the maximum number permitted by the Exchange.

(b)

No single Participant may be granted options to purchase a number of Shares equaling more than 5% of the issued common shares of the Corporation in any twelve-month period unless the Corporation has obtained disinterested shareholder approval in respect of such grant and meets applicable Exchange requirements.

(c)

Options shall not be granted if the exercise thereof would result in the issuance of more than 2% of the issued common shares of the Corporation in any twelve-month period to any one consultant of the Corporation (or any of its subsidiaries).

(d)

Options shall not be granted if the exercise thereof would result in the issuance of more than 2% of the issued common shares of the Corporation in any twelve month period to persons employed to provide investor relation activities.  Options granted to Consultants performing investor relations activities will contain vesting provisions such that vesting occurs over at least 12 months with no more than 1⁄4 of the options vesting in any 3 month period.

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9.

Duration of Option

Each option and all rights thereunder shall be expressed to expire on the date set out in the option agreement and shall be subject to earlier termination as provided in Sections 11 and 12, provided that in no circumstances shall the duration of an option exceed the maximum term permitted by the Exchange.  For greater certainty, if the Corporation is listed on the TSX Venture exchange (“TSX Venture”), the maximum term may not exceed 10 years if the Corporation is classified as a “Tier 1” issuer by the TSX Venture, and the maximum term may not exceed 5 years if the Corporation is classified as a “Tier 2” issuer by the TSX Venture.

10.

Option Period, Consideration and Payment

(a)

The option period shall be a period of time fixed by the Board not to exceed the maximum term permitted by the Exchange, provided that the option period shall be reduced with respect to any option as provided in Sections 11 and 12 covering cessation as a director, officer, consultant, employee or Management Company Employee of the Corporation or its subsidiaries, or death of the Participant.

(b)

Subject to any vesting restrictions imposed by the Exchange, the Board may, in its sole discretion, determine the time during which options shall vest and the method of vesting, or that no vesting restrictions shall exist.

(c)

Subject to any vesting restrictions imposed by the Board, options may be exercised in whole or in part at any time and from time to time during the option period.  To the extent required by the Exchange, no options may be exercised under this Plan until this Plan has been approved by a resolution duly passed by the shareholders of the Corporation.

(d)

Except as set forth in Sections 11 and 12, no option may be exercised unless the Participant is at the time of such exercise a director, officer, consultant, or employee of the Corporation or any of its subsidiaries, or a Management Company Employee of the Corporation or any of its subsidiaries.

(e)

The exercise of any option will be contingent upon receipt by the Corporation at its head office of a written notice of exercise, specifying the number of Shares with respect to which the option is being exercised, accompanied by a cash payment, certified cheque or bank draft for the full purchase price of such Shares with respect to which the option is exercised.  No Participant or his legal representatives, legatees or distributes will be, or will be deemed to be, a holder of any common shares of the Corporation unless and until the certificates for Shares issuable pursuant to options under the Plan are issued to him or them under the terms of the Plan.

11.

Ceasing To Be a Director, Officer, Consultant or Employee

If a Participant shall cease to be a director, officer, consultant, employee of the Corporation, or its subsidiaries, or ceases to be a Management Company Employee, for any reason (other than death), such Participant may exercise his option to the extent that the Participant was entitled to exercise it as at the date of such cessation, provided that such exercise must occur within 90 days after the Participant ceases to be a director, officer, consultant, employee or a Management Company Employee, unless such Participant was engaged in investor relations activities, in which case such exercise must occur within 30 days after the cessation of the Participant’s services to the Corporation.

Nothing contained in the Plan, nor in any option granted pursuant to the Plan, shall as such confer upon any Participant any right with respect to continuance as a director, officer, consultant, employee or Management Company Employee of the Corporation or of any of its subsidiaries or affiliates.

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12.

Death of Participant

Notwithstanding section 11, in the event of the death of a Participant, the option previously granted to him shall be exercisable only within the one (1) year after such death and then only:

(a)

by the person or persons to whom the Participant’s rights under the option shall pass by the Participant’s will or the laws of descent and distribution; and

(b)

if and to the extent that such Participant was entitled to exercise the Option at the date of his death.

13.

Rights of Optionee

No person entitled to exercise an option granted under the Plan shall have any of the rights or privileges of a shareholder of the Corporation in respect of any Shares issuable upon exercise of such option until certificates representing such Shares shall have been issued and delivered.

14.

Proceeds from Sale of Shares

The proceeds from the sale of Shares issued upon the exercise of options shall be added to the general funds of the Corporation and shall thereafter be used from time to time for such corporate purposes as the Board may determine.

15.

Cash Surrender Option

Where the Shares are listed and posted for trading on a recognized stock exchange, Participants may elect to surrender, unexercised, options to purchase Shares (“Options”) granted pursuant to the Plan that are vested and exercisable, to the Corporation in consideration of the receipt by the Participant of an amount (the “Settlement Amount”) equal to the excess, if any, of the aggregate fair market value of the Shares (based on the weighted average trading price of the Shares on such stock exchange during the five trading days preceding the date of surrender or the price pursuant to an offer made for all of the issued and outstanding Shares, whichever is greater) able to be purchased pursuant to the vested and exercisable portion of such Options on the date of surrender, over the aggregate exercise price for the Shares pursuant to such Options.  In no circumstances will the Participant at any time be obligated to surrender Options as provided by this cash surrender option.  The Corporation may, in its sole discretion, refuse to accept the surrender of unexercised Options and if any such surrender is not accepted by the Corporation or completed for any reason, the notice of surrender (as described below) shall be deemed to be withdrawn and the Options in respect of such notice was provided shall again become subject to their original terms as if such notice of surrender had not been provided.  Unexercised Options may be surrendered in whole or in part from time to time by delivery to the Corporation at its head office of a written notice of surrender specifying the number of Shares with respect which the unexercised Options are being surrendered.  Upon the surrender of unexercised Options as aforesaid, the Corporation shall use its reasonable efforts to forthwith deliver to the relevant Participant (or his personal representative, if applicable) or to the order thereof, payment of the Settlement Amount (net of any amounts required to be withheld under applicable withholding legislation) by way of cheque or otherwise in a manner acceptable to the Corporation.

16.

Adjustments

If the outstanding common shares of the Corporation are increased, decreased, changed into or exchanged for a different number or kind of shares or securities of the Corporation or another corporation or entity through re-organization, merger, re-capitalization, re-classification, stock dividend, subdivision or consolidation, any adjustments relating to the Shares optioned or issued on exercise of options and the exercise price per Share as set forth in the respective stock option agreements shall be made in accordance to the terms of such agreements.

Adjustments under this Section shall be made by the Board whose determination as to what adjustments shall be made, and the extent thereof, shall be final, binding and conclusive.  No fractional Share shall be required to be issued under the Plan on any such adjustment.

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17.

Transferability

All benefits, rights and options accruing to any Participant in accordance with the terms and conditions of the Plan shall not be transferable or assignable unless specifically provided herein or the extent, if any, permitted by the Exchange.  During the lifetime of a Participant any benefits, rights and options may only be exercised by the Participant.

18.

Amendment and Termination of Plan

Subject to applicable approval of the Exchange, the Board may, at any time, suspend or terminate the Plan.  Subject to applicable approval of the Exchange, the Board may at any time amend or revise the terms of the Plan; provided that no such amendment or revision shall result in a material adverse change to the terms of any options theretofore granted under the Plan, unless shareholder approval, or disinterested shareholder approval, as the case may be, is obtained for such amendment or revision.

19.

Necessary Approvals

The ability of a Participant to exercise options and the obligations of the Corporation to issue and deliver Shares in accordance with the Plan is subject to any approvals which may be required from shareholders of the Corporation and any regulatory authority or stock exchange having jurisdiction over the securities of the Corporation.  If any Shares cannot be issued to any Participant for whatever reason, the obligation of the Corporation to issue such Shares shall terminate and any option exercise price paid to the Corporation will be returned to the Participant.

20.

Effective Date of Plan

The Plan has been adopted by the Board of the Corporation subject to the approval of the Exchange, and, if so approved, subject to the discretion of the Board, the Plan shall become effective upon such approvals being obtained.

21.

Interpretation

The Plan will be governed by and construed in accordance with the laws of the Province of Alberta.

MADE by the Board of Directors of the Corporation as evidenced by the signature of the following director duly authorized in that behalf effective the 6th day of June, 2007 and approved by the shareholders of the Corporation on the 7th day of November, 2007.

		
	 
	/ s / Tim Coupland

	Tim Coupland

	President, Chief Executive Officer and

	Director

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