WAIVER AND RELEASE

1.                                        Employee will be paid $100,000 upon the date both parties have signed this Waiver and Release, and Employee has  returned to Employer all property owned by Employer including by not limited to all computers, cell phone, credit cards and keys.

2.                                        Employee will be paid $50,000 30 days after the date in II.A.1. above, provided that Employee has complied with the requirements in II.A.4. below.

3.                                        Employee will be paid $50,000 on December 31, 2008, provided that Employee has complied with the requirements in II.A.4., below.

4.                                        Employee agrees that he will make his best efforts to assist in the orderly transition of projects or other matters for which he was responsible at the time of his resignation.  Employee has provided to Employer, a Transition Document indicating the projects or matters for which he was responsible, their status, and any requirements remaining for their satisfactory completion.  Employee will also identify any employees in the Company with whom he is working and those individuals from outside the Company who are participating in the project or matter.  The parties agree that the aim of this section is to ensure the orderly continuation of the Company’s work.  Employee agrees to cooperate with Company for any clarification requests following submittal of the Transition Document .  After his resignation from the Company is effective, Employee also agrees that he will provide the Company upon its request information or other assistance within the areas of his responsibilities while employed by the Company.  Specifically, Employee agrees to perform services for Employer, with respect to a water rights hearing currently scheduled for October, 2008 (“the Water Rights Hearing”).  Employee agrees that he will cooperate fully with Employer’s representatives in all aspects of the Water Rights Hearing.  Employee also agrees to use his best efforts to prepare for and assist in the Employer’s preparation for the Water Rights Hearing, and to provide truthful testimony on areas currently disclosed by Employer and consistent with the Employer’s position in its disclosed filings.  Employee further agrees to assist the Employer’s preparation for the Valenti termination case and to participate as a witness for Employer in any legal proceedings if requested without the need for a subpoena.  If the water rights hearing and the Valenti termination case  extend beyond the time anticipated, and require assistance by Employee exceeding two (2) weeks of total time, the parties agree to work toward a mutually agreeable resolution for fair compensation to

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employee.  Employee will be reimbursed for travel and other expenses directly related to performing any services that are requested for or on behalf of Employer after the termination of Employee, pursuant to the terms of this agreement.

B.                                      Employee has a stock option grant to purchase 30,000 shares of common stock in the Company at a price of $2.10 per share.  These options are scheduled to vest on August 16, 2008.  Upon the effective date of this agreement, these options will be fully vested.  Employee will have one year from his date of termination to exercise these options, pursuant to the terms of the 2006 Equity Incentive Plan.

C.                                      The payments described in II.A. above, are in settlement of any claims, except any claim that Employee has for reimbursement for business-related expenses, (which will be paid in accordance with Employer’s normal corporate reimbursement policies), and as the entire payment for all claims that might have been brought in any lawsuit or in any state or federal judicial or administrative forum up to the date of the execution of this Waiver and Release, including any claims for attorneys’ fees and costs.  The Employer shall apply appropriate withholdings against these amounts.

D.                                     In consideration of the payment by Employer to Employee of the sum described in paragraph II.A., and II.C above, and the stock options provided for in paragraph II.B., Employee, individually and on behalf of his successors, heirs, and assigns, hereby forever releases, remises, waives, acquits, and discharges Employer, together with any and all parent corporations of Employer and their respective subsidiaries, successors, predecessors, assigns, directors, officers, shareholders, supervisors, employees, attorneys, agents, insurers, and representatives, from any and all actions, causes of action, claims, demands, losses, damages, costs, attorneys’ fees, judgments, liens, indebtedness, and liabilities whatsoever, known or unknown, suspected or unsuspected, past or present, arising from or relating or attributable to Employee’s employment by Employer, the termination of said employment, Employee’s subsequent search for other employment to the date of this Waiver and Release, and without limiting the generality of the foregoing, from any and all matters asserted, or which could have been asserted, in any state or federal judicial or administrative forum, up to the date of this Waiver and Release, specifically, but not by way of limitation, including claims under the Fair

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Labor Standards Act, as amended, the National Labor Relations Act, as amended, Title VII of the Civil Rights Act of 1964, as amended, the Post-Civil War Reconstruction Acts, as amended, the Age Discrimination in Employment Act, as amended, the Americans with Disabilities Act, the Rehabilitation Act of 1973, as amended, the Civil Rights Act of 1991, the Family and Medical Leave Act, the Employee Retirement Income Security Act of 1974, any state civil rights act, any state statutory claim, including wage and hour claims, and any claim of wrongful disch