f KmikeyM.com

Stock Pool

Posted on August 3, 2012

Description:

In 2008 we created the KmikeyM.com website by hiring a local web developer. His payment was half in cash ($500 USD) and half in shares (500 shares). Since that time it has been determined that we should not issue shares in exchange for work as it undercut the current marketplace. As we enter 2012 and begin working with additional developers on KmikeyM.com and various other projects it's becoming apparent that payment with K5M stock is highly valued, and can be especially leveraged within the start-up community where the culture of being paid in stock already exists.

This proposal is to set aside 20% of K5M stock to be issued on a per-project basis to people working on KmikeyM development. While the percentage may initially seem high, this is designed to be the only Stock Pool we will be issuing from and expect it to last a very long time. Shares will be granted based on the current fair price, as determined by the historical price and the list of current offers. All the specifics are spelled out below:

SECTION 1. Establishment And Purpose.

The purpose of the KmikeyM Stock Pool Plan ("Plan") is to offer selected individuals an opportunity to acquire a proprietary interest in the success of the Company, or to increase such interest, by purchasing Shares of the capital stock of the Company. The Plan provides for the direct award or sale of Shares.

SECTION 2. Administration.

(a) The Plan may be administered by K. Mike Merrill or those granted such responsibilities by K. Mike Merrill who also have Shareholder approval.

(b) Subject to the provisions of the Plan, the Shareholders shall have full authority and discretion to take any actions they deems necessary or advisable for the administration of the Plan. All decisions, interpretations and other actions of the Shareholders shall be final and binding on all Purchasers and all persons deriving their rights from a Purchaser.

SECTION 3. Eligibility.

(a) Only Employees, Outside Directors and Consultants shall be eligible for the direct award or sale of Shares.

(b) K. Mike Merrill, while serving as the person who is being traded, shall not be eligible for the direct award or sale of Shares.

SECTION 4. Stock Subject To Plan.

Shares offered under the Plan may be authorized but unissued Shares. The aggregate number of Shares that may be issued under the Plan shall not exceed 20,000 Shares, subject to adjustment pursuant to Section 7.

SECTION 5. Terms And Conditions Of Awards Or Sales.

(a) Stock Purchase or Grant Agreement. Each award or sale of Shares under the Plan shall be reported to the Shareholders via a Stock Purchase or Grant Agreement issued no less than quarterly. The provisions of the various Stock Purchase Agreements entered into under the Plan need not be identical.

(b) Purchase Price. The value of Shares issued will not be less than the current Fair Market Value of the Shares on the date of the grant as determined by the recent history of trading as well as current offers.

SECTION 6. Payment For Shares.

(a) General Rule. The entire Exercise Price of Shares issued under the Plan shall be payable in cash or cash equivalents at the time when such Shares are purchased, except as otherwise provided in this Section 6.

(b) Services Rendered. At the discretion of the Company, Shares may be awarded under the Plan in consideration of services rendered to the Company, a Parent or a Subsidiary.

SECTION 7. Adjustment Of Shares.

(a) Mergers and Consolidations. In the event that the Company is a party to a merger or consolidation, outstanding Shares in the Plan shall be subject to the agreement of merger or consolidation. Such agreement may provide for:
(i) The continuation of the Plan by the Company (if the Company is the surviving corporation);
(ii) The assumption of the Plan by the surviving corporation or its parent;
(iii) The substitution by the surviving corporation or its parent of the Plan with substantially the same terms;
(iv) The full purchase of such outstanding Shares and full vesting of the Shares, followed by the cancellation of the Plan.

SECTION 8. No Retention Rights.

Nothing in the Plan shall confer upon the Purchaser any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining the Purchaser) or of the Purchaser, which rights are hereby expressly reserved by each, to terminate the Purchaser’s Service at any time and for any reason, with or without cause.

SECTION 9. Duration and Amendments.

(a) Term of the Plan. The Plan, as set forth herein, shall become effective on the date of its adoption by the Shareholders.

(b) Right to Amend or Terminate the Plan. The Shareholders may amend, suspend or terminate the Plan at any time and for any reason.


No - 12

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