PetLife Pharmaceuticals, Inc.

 

2016 Stock Option Plan

 

SECTION 1 GENERAL PURPOSE OF THE PLAN; DEFINITIONS

 

The name of the plan is the PetLife Pharmaceuticals, Inc., 2016 Stock Option
Plan (the “Plan”). The purpose of the Plan is to encourage and enable the
officers, employees, directors, consultants and other key persons of PetLife
Pharmaceuticals, Inc., a Nevada corporation (the “Company”) and its Parents,
Subsidiaries and Affiliates, upon whose judgment, initiative and efforts the
Company largely depends for the successful conduct of its business to acquire a
proprietary interest in the Company. It is anticipated that providing such
persons with a direct stake in the Company’s welfare will assure a closer
identification of their interests with those of the Company, thereby stimulating
their efforts on the Company’s behalf and strengthening their desire to remain
with and or further the interests of the Company.

 

The following terms shall be defined as set forth below:

 

“Affiliate” means with respect to a specified Person, any Person that directly,
or indirectly through one or more intermediaries, Controls, or is Controlled by,
or is under common Control with, the specified Person.

 

“Award” or “Awards,” except where referring to a particular category of grant
under the Plan, shall include Incentive Stock Options, Non-Qualified Stock
Options, Restricted Stock Awards, Unrestricted Stock Awards, or any combination
of the foregoing.

 

“Board” means the Board of Directors of the Company.

 

“Code” means the Internal Revenue Code of 1986, as amended, and any successor
Code, and related rules, regulations and interpretations.

 

“Control” means the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of a Person, whether through
ownership of voting securities, contract, or otherwise.

 

“Committee” has the meaning specified in Section 2.

 

“Effective Date” means the date on which the Plan is approved by stockholders as
set forth at the end of this Plan.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

“Fair Market Value” of the Stock on any given date means the fair market value
of the Stock determined as the average of the highest bid and lowest asked
prices of the Stock reported on the Over-the-Counter Bulletin Board or Pink
Sheets, as applicable, for such date or, if no bid and asked prices were
reported for such date, for the last day preceding such date for which such
prices were reported; provided, however, that (i) if the Stock is admitted to
trading on a national securities exchange or the NASDAQ National Market System,
the Fair Market Value on any date shall not be less than the last reported
closing price for the Stock on such exchange or system and (ii) if the stock is
not traded on any national securities exchange or on the Over-the-Counter
Bulletin Board or Pink Sheets, the Fair Market Value of the Stock shall be
determined in good faith by the Committee.

 

 

 

 

“Incentive Stock Option” means any Stock Option designated and qualified as an
“incentive stock option” as defined in Section 422 of the Code.

 

“Initial Public Offering” means the consummation of the first fully
underwritten, firm commitment public offering pursuant to an effective
registration statement under the Act, other than on Forms S-4 or S-8 or their
then equivalents, covering the offer and sale by the Company of its Stock, or
such other event as a result of or following which the Company’s Stock shall be
registered under Section 12 of the Exchange Act.

 

“Non-Qualified Stock Option” means any Stock Option that is not an Incentive
Stock Option.

 

“Option” or “Stock Option” means any option to purchase shares of Stock granted
pursuant to Section 5.

 

“Outside Director” means a member of the Board who is not also an employee or
officer of the Company or any Subsidiary.

 

“Parent” means any corporation or other entity (other than the Company) in any
unbroken chain of corporations or other entities ending with the Company if each
of the corporations or entities (other than the Company) owns stock or other
interests possessing 50 percent or more of the economic interest or the total
combined voting power of all classes of stock or other interests in one of the
other corporations or entities in the chain.

 

“Person” means any individual, corporation, partnership (limited or general),
limited liability company, limited liability partnership, association, trust,
joint venture, unincorporated organization or any similar entity.

 

“Restricted Stock Award” means Awards granted pursuant to Section 6.

 

“Stock” means the Common Stock, par value $0.001 per share, of the Company,
subject to adjustments pursuant to Section 3.

 

“Subsidiary” means any corporation or other entity (other than the Company) in
any unbroken chain of corporations or other entities beginning with the Company
if each of the corporations or entities (other than the last corporation or
entity in the unbroken chain) owns stock or other interests possessing 50
percent or more of the economic interest or the total combined voting power of
all classes of stock or other interests in one of the other corporations or
entities in the chain.

 

“Unrestricted Stock Award” means any Award granted pursuant to Section 7.

 

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SECTION 2 ADMINISTRATION OF PLAN; COMMITTEE AUTHORITY TO SELECT PARTICIPANTS AND
DETERMINE AWARDS

 

(a) Administration of Plan. The Plan shall be administered by the Board, or at
the discretion of the Board, by a committee or committees of the Board,
comprised, except as contemplated by Section 2(c), of not less than two
Directors. All references herein to the Committee shall be deemed to refer to
the group then responsible for administration of the Plan at the relevant time
(i.e., either the Board of Directors or a committee or committees of the Board,
as applicable).

 

(b) Powers of Committee. The Committee shall have the power and authority to
grant Awards consistent with the terms of the Plan, including the power and
authority:

 

(i) to select the officers, employees, directors, consultants and key persons of
the Company and/or its Subsidiaries and Affiliates to whom Awards may from time
to time be granted;

 

(ii) to determine the time or times of grant, and the extent, if any, of
Incentive Stock Options, Non-Qualified Stock Options, Restricted Stock Awards,
Unrestricted Stock Awards, or any combination of the foregoing, granted to any
one or more participants;

 

(iii) to determine the number of shares of Stock to be covered by any Award;

 

(iv) to determine and modify from time to time the terms and conditions,
including restrictions, not inconsistent with the terms of the Plan, of any
Award, which terms and conditions may differ among individual Awards and
participants, and to approve the form of written instruments evidencing the
Awards;

 

(v) to impose any limitations on Awards granted under the Plan, including
limitations on transfers, repurchase provisions and the like and to exercise
repurchase rights or obligations;

 

(vi) subject to the provisions of Section 5(a)(ii), to extend at any time the
period in which Stock Options may be exercised;

 

(vii) to determine at any time whether, to what extent, and under what
circumstances distribution or the receipt of Stock and other amounts payable
with respect to an Award shall be deferred either automatically or at the
election of the participant and whether and to what extent the Company shall pay
or credit amounts constituting interest (at rates determined by the Committee)
or dividends or deemed dividends on such deferrals; and

 

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(viii) at any time to adopt, alter and repeal such rules, guidelines and
practices for administration of the Plan and for its own acts and proceedings as
it shall deem advisable; to interpret the terms and provisions of the Plan and
any Award (including related written instruments); to make all determinations it
deems advisable for the administration of the Plan; to decide all disputes
arising in connection with the Plan; and to otherwise supervise the
administration of the Plan.

 

(ix) All decisions and interpretations of the Committee shall be binding on all
persons, including the Company and Plan participants.

 

(c) Delegation of Authority to Grant Awards. The Committee, in its discretion,
may delegate to the Chief Executive Officer of the Company all or part of the
Committee’s authority and duties with respect to the granting of Awards at Fair
Market Value to individuals who are not subject to the reporting and other
provisions of Section 16 of the Exchange Act or “covered employees” within the
meaning of Section 162(m) of the Code. Any such delegation by the Committee
shall include a limitation as to the amount of Awards that may be granted during
the period of the delegation and shall contain guidelines as to the
determination of the exercise price of any Option, the conversion ratio or price
of other Awards and the vesting criteria. The Committee may revoke or amend the
terms of a delegation at any time but such action shall not invalidate any prior
actions of the Committee’s delegate or delegates that were consistent with the
terms of the Plan.

 

SECTION 3 STOCK ISSUABLE UNDER THE PLAN; MERGERS; SUBSTITUTION

 

(a) Stock Issuable. The maximum number of shares of Stock reserved and available
for issuance under the Plan shall be 20,000,000 shares of Common Stock, subject
to adjustment as provided in Section 3(b). For purposes of this limitation, the
shares of Stock underlying any Awards which are forfeited, canceled, reacquired
by the Company, satisfied without the issuance of Stock or otherwise terminated
(other than by exercise) shall be added back to the shares of Stock available
for issuance under the Plan. Subject to such overall limitation, shares of Stock
may be issued up to such maximum number pursuant to any type or types of Award.
The shares available for issuance under the Plan may be authorized but unissued
shares of Stock or shares of Stock reacquired by the Company and held in its
treasury.

 

(b) Changes in Stock. Subject to Section 3(c) hereof, if, as a result of any
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar change in the Company’s capital stock, the
outstanding shares of Stock are increased or decreased or are exchanged for a
different number or kind of shares or other securities of the Company, or
additional shares or new or different shares or other securities of the Company
or other non-cash assets are distributed with respect to such shares of Stock or
other securities, or, if, as a result of any merger, consolidation or sale of
all or substantially all of the assets of the Company, the outstanding shares of
Stock are converted into or exchanged for different number or kind of securities
of the Company or any successor entity (or a Subsidiary or Affiliate thereof),
the Committee shall make an appropriate or proportionate adjustment in (i) the
maximum number of shares reserved for issuance under the Plan, (ii) the number
and kind of shares or other securities subject to any then outstanding Awards
under the Plan, (iii) the repurchase price per share subject to each outstanding
Restricted Stock Award, and (iv) the exercise price and/or exchange price for
each share subject to any then outstanding Stock Options under the Plan, without
changing the aggregate exercise price (i.e., the exercise price multiplied by
the number of Stock Options ) as to which such Stock Options remain exercisable.
The adjustment by the Committee shall be final, binding and conclusive. No
fractional shares of Stock shall be issued under the Plan resulting from any
such adjustment, but the Committee in its discretion may make a cash payment in
lieu of fractional shares.

 

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(c) The Committee may also adjust the number of shares subject to outstanding
Awards and the exercise price and the terms of outstanding Awards to take into
consideration material changes in accounting practices or principles,
extraordinary dividends, acquisitions or dispositions of stock or property or
any other event if it is determined by the Committee that such adjustment is
appropriate to avoid distortion in the operation of the Plan, provided that no
such adjustment shall be made in the case of an Incentive Stock Option, without
the consent of the participant, if it would constitute a modification, extension
or renewal of the Option within the meaning of Section 424(h) of the Code.

 

(d) Mergers and Other Sale Events. In the case of and subject to the
consummation of (i) the dissolution or liquidation of the Company, (ii) the sale
of all or substantially all of the assets of the Company on a consolidated basis
to an unrelated person or entity, (iii) a merger, reorganization or
consolidation in which the outstanding shares of Stock are converted into or
exchanged for a different kind of securities of the successor entity and the
holders of the Company’s outstanding voting power immediately prior to such
transaction do not own a majority of the outstanding voting power of the
successor entity immediately upon completion of such transaction, or (iv) the
sale of all of the Stock of the Company to an unrelated person or entity (in
each case, regardless of the form thereof, a “Sale Event”), then (A) the Plan
shall terminate upon the effective date and time of such Sale Event and (B)
unless otherwise provided in the applicable Award agreements, (x) all
unexercised Options, whether vested or unvested, issued and outstanding
immediately prior to the consummation of such Sale Event shall expire and
terminate upon the effective date and time that such Sale Event is consummated,
and (y) all unvested portions of any Restricted Stock Award outstanding
immediately prior to the consummation of the Sale Event shall expire and
terminate upon the effective date and time that such Sale Event is consummated.
In the event of such termination of the Plan pursuant to this Section 3(b), each
Plan participant shall be permitted within a specified period of time prior to
the consummation of the Sale Event as determined by the Committee to exercise
all outstanding Options held by such participant which are then exercisable or
will become exercisable immediately prior to the consummation of the Sale Event.

 

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(e) Notwithstanding the foregoing, the parties to any Sale Event transaction
may, in their sole discretion, provide for the assumption or continuation of
Plan Awards theretofore granted (after taking into account any acceleration
hereunder) by the successor entity, or the substitution for such Plan Awards of
new Awards of the successor entity or a Subsidiary or Affiliate thereof, with an
appropriate adjustment as to the number and kind of shares and the per share
exercise prices (after taking into account any acceleration provided for
hereunder).

 

(f) Substitute Awards. The Committee may grant Awards under the Plan in
substitution for stock and stock based awards held by employees, directors or
other option holders of another corporation in connection with a merger or
consolidation of the employing corporation with the Company or a Subsidiary or
Affiliate, or the acquisition by the Company or a Subsidiary or Affiliate of
property or stock of the employing corporation. The Committee may direct that
the substitute awards be granted on such terms and conditions as the Committee
considers appropriate in the circumstances. Any substitute Awards granted under
the Plan shall not count against the share limitation set forth in Section 3(a).

 

SECTION 4 ELIGIBILITY

 

Participants in the Plan will be such full or part-time officers, employees,
directors, consultants and other key persons of the Company and/or its
Subsidiaries and Affiliates who are responsible for, or contribute to, the
management, growth or profitability of the Company and/or its Subsidiaries and
Affiliates as are selected from time to time by the Committee in its sole
discretion.

 

SECTION 5 STOCK OPTIONS

 

Any Stock Option granted under the Plan shall be pursuant to a Stock Option
Agreement that shall be in such form as the Committee may from time to time
approve. Option agreements need not be identical.

 

Stock Options granted under the Plan may be either Incentive Stock Options or
Non-Qualified Stock Options. Incentive Stock Options may be granted only to
employees of (i) the Company or (ii) any Subsidiary that is a “subsidiary
corporation” within the meaning of Section 424(f) of the Code or (iii) any
Parent that is a “parent corporation” within the meaning of Section 424(e) of
the Code. To the extent that any Option does not qualify as an Incentive Stock
Option, it shall be deemed a Non-Qualified Stock Option.

 

No Incentive Stock Option shall be granted under the Plan after the Board
approves the date, which is 10 years from the date the Plan.

 

(a) Terms of Stock Options. Stock Options granted under the Plan shall be
subject to the following terms and conditions and shall contain such additional
terms and conditions, not inconsistent with the terms of the Plan, as the
Committee shall deem desirable. If the Committee so determines, Stock Options
may be granted in lieu of cash compensation at the participant’s election,
subject to such terms and conditions as the Committee may establish, as well as
in addition to other compensation.

 

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(b) Exercise Price. The exercise price per share for the Stock covered by a
Stock Option shall be determined by the Committee at the time of grant but shall
not be less than 100 percent of the Fair Market Value on the date of grant in
the case of Incentive Stock Options. If an employee owns or is deemed to own (by
reason of the attribution rules of Section 424(d) of the Code) more than 10
percent of the combined voting power of all classes of stock of the Company or
any parent or subsidiary corporation and an Incentive Stock Option is granted to
such employee, the option price of such Incentive Stock Option shall be not less
than 110 percent of the Fair Market Value on the grant date. If the Fair Market
Value is undeterminable at the time of grant due to no trading or thinly traded,
an arbitrary exercise price shall be set by the Company.

 

(c) Option Term. The term of each Stock Option shall be fixed by the Committee,
but no Stock Option shall be exercisable more than five years after the date the
option is granted. If an employee owns or is deemed to own (by reason of the
attribution rules of Section 424(d) of the Code) more than 10 percent of the
combined voting power of all classes of stock of the Company or any parent or
subsidiary corporation and an Incentive Stock Option is granted to such
employee, the term of such option shall be no more than five years from the date
of grant.

 

(d) Exercisability; Rights of a Stockholder. Stock Options shall become
exercisable at such time or times, whether or not in installments, as shall be
determined by the Committee at or after the grant date. The Committee may at any
time accelerate the exercisability of all or any portion of any Stock Option. An
optionee shall have the rights of a stockholder only as to shares acquired upon
the exercise of a Stock Option and not as to unexercised Stock Options.

 

(i) Method of Exercise. Stock Options may be exercised in whole or in part, by
giving written notice of exercise to the Company, specifying the number of
shares to be purchased. Payment of the purchase price may be made by one or more
of the following methods to the extent provided in the Award agreement:

 

(ii) In cash, by certified or bank check, or other instrument acceptable to the
Committee in U.S. funds payable to the order of the Company in an amount equal
to the purchase price of such Option Shares;

 

(iii) By the optionee delivering to the Company a promissory note if the Board
has expressly authorized the loan of funds to the optionee for the purpose of
enabling or assisting the optionee to effect the exercise of his or her Stock
Option; provided that at least so much of the exercise price as represents the
par value of the Stock shall be paid other than with a promissory note;

 

(iv) If permitted by the Committee, through the delivery (or attestation to the
ownership) of shares of Stock that have been purchased by the optionee on the
open market or have been beneficially owned by the optionee for at least six
months and are not then subject to restrictions under any Company plan. Such
surrendered shares shall be valued at Fair Market Value on the exercise date;

 

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(v) If permitted by the Committee, by the optionee delivering to the Company a
properly executed exercise notice together with irrevocable instructions to a
broker to promptly deliver to the Company cash or a check payable and acceptable
to the Company to pay the purchase price; provided that in the event the
optionee chooses to pay the purchase price as so provided, the optionee and the
broker shall comply with such procedures and enter into such agreements of
indemnity and other agreements as the Committee shall prescribe as a condition
of such payment procedure.

 

(vi) Payment instruments will be received subject to collection. No certificates
for Option Shares so purchased will be issued to optionee until the Company has
completed all steps required by law to be taken in connection with the issuance
and sale of the shares, including without limitation (i) receipt of a
representation from the optionee at the time of exercise of the Option that the
optionee is purchasing the Option Shares for the optionee’s own account and not
with a view to any sale or distribution thereof, (ii) the legending of any
certificate representing the shares to evidence the foregoing representations
and restrictions, and (iii) obtaining from optionee payment or provision for all
withholding taxes due as a result of the exercise of the Option. The delivery of
certificates representing the shares of Stock to be purchased pursuant to the
exercise of a Stock Option will be contingent upon receipt from the optionee (or
a purchaser acting in his or her stead in accordance with the provisions of the
Stock Option) by the Company of the full purchase price for such shares and the
fulfillment of any other requirements contained in the Stock Option or
applicable provisions of laws. In the event an optionee chooses to pay the
purchase price by previously owned shares of Stock through the attestation
method, the shares of Stock transferred to the optionee upon the exercise of the
Stock Option shall be net of the number of shares attested to.

 

(e) Annual Limit on Incentive Stock Options. To the extent required for
“incentive stock option” treatment under Section 422 of the Code, the aggregate
Fair Market Value (determined as of the time of grant) of the shares of Stock
with respect to which Incentive Stock Options granted under this Plan and any
other plan of the Company or its parent and subsidiary corporations become
exercisable for the first time by an optionee during any calendar year shall not
exceed $100,000. To the extent that any Stock Option exceeds this limit, it
shall constitute a Non-Qualified Stock Option.

 

(f) Non-transferability of Options. No Stock Option shall be transferable by the
optionee otherwise than by will or by the laws of descent and distribution and
all Stock Options shall be exercisable, during the optionee’s lifetime, only by
the optionee, or by the optionee’s legal representative or guardian in the event
of the optionee’s incapacity. Notwithstanding the foregoing, the Committee, in
its sole discretion, may provide in the Award agreement regarding a given Option
that the optionee may transfer, without consideration for the transfer, his or
her Non-Qualified Stock Options to members of his or her immediate family, to
trusts for the benefit of such family members, or to partnerships in which such
family members are the only partners, provided that the transferee agrees in
writing with the Company to be bound by all of the terms and conditions of this
Plan and the applicable Option.

 

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(g) Termination. Unless otherwise provided in the option agreement or determined
by the Committee, upon the optionee’s termination of employment (or other
business relationship) with the Company and its Subsidiaries, the optionee’s
rights in his or her Stock Options shall automatically terminate.

 

SECTION 6 RESTRICTED STOCK AWARDS

 

(a) Nature of Restricted Stock Awards. A Restricted Stock Award is an Award
pursuant to which the Company may, in its sole discretion, grant or sell, at par
value or such other higher purchase price determined by the Committee, in its
sole discretion, shares of Stock subject to such restrictions and conditions as
the Committee may determine at the time of grant (“Restricted Stock”), which
purchase price shall be payable in cash or by promissory note (recourse, partial
recourse, or nonrecourse) acceptable to the Committee. Conditions may be based
on continuing employment (or other business relationship) and/or achievement of
pre-established performance goals and objectives. The grant of a Restricted
Stock Award is contingent on the participant executing the Restricted Stock
Award agreement. The terms and conditions of each such agreement shall be
determined by the Committee, and such terms and conditions may differ among
individual Awards and participants.

 

(b) Rights as a Stockholder. Upon execution of a written instrument setting
forth the Restricted Stock Award and payment of any applicable purchase price, a
participant shall have the rights of a stockholder with respect to the voting of
the Restricted Stock, subject to such conditions contained in the written
instrument evidencing the Restricted Stock Award. Unless the Committee shall
otherwise determine, certificates evidencing the Restricted Stock shall remain
in the possession of the Company until such Restricted Stock is vested as
provided in subsection (d) below of this Section, and the participant shall be
required, as a condition of the grant, to deliver to the Company a stock power
endorsed in blank.

 

(c) Restrictions. Restricted Stock may not be sold, assigned, transferred,
pledged or otherwise encumbered or disposed of except as specifically provided
herein or in the Restricted Stock Award agreement. If a participant’s employment
(or other business relationship) with the Company and its Subsidiaries
terminates under the conditions specified in the relevant instrument relating to
the Award, or upon such other event or events as may be stated in the instrument
evidencing the Award, the Company or its assigns shall have the right or shall
agree, as may be specified in the relevant instrument, to repurchase some or all
of the shares of Stock subject to the Award at such purchase price as is set
forth in such instrument.

 

(d) Vesting of Restricted Stock. The Committee at the time of grant shall
specify the date or dates and/or the attainment of pre-established performance
goals, objectives and other conditions on which Restricted Stock shall become
vested, subject to such further rights of the Company or its assigns as may be
specified in the instrument evidencing the Restricted Stock Award.

 

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(e) Waiver, Deferral and Reinvestment of Dividends. The Restricted Stock Award
agreement may require or permit the immediate payment, waiver, deferral or
investment of dividends paid on the Restricted Stock.

 

SECTION 7 UNRESTRICTED STOCK AWARDS

 

(a) Grant or Sale of Unrestricted Stock. The Committee may, in its sole
discretion, grant (or sell at par value or such higher purchase price determined
by the Committee) an Unrestricted Stock Award to any participant, pursuant to
which such participant may receive shares of Stock free of any vesting
restrictions (“Unrestricted Stock”) under the Plan. Unrestricted Stock Awards
may be granted or sold as described in the preceding sentence in respect of past
services or other valid consideration, or in lieu of any cash compensation due
to such individual.

 

(b) Elections to Receive Unrestricted Stock In Lieu of Compensation. Upon the
request of a participant and with the consent of the Committee, each such
participant may, pursuant to an advance written election delivered to the
Company no later than the date specified by the Committee, receive a portion of
the cash compensation otherwise due to such participant in the form of shares of
Unrestricted Stock either currently or on a deferred basis.

 

(c) Restrictions on Transfers. The right to receive shares of Unrestricted Stock
on a deferred basis may not be sold, assigned, transferred, pledged or otherwise
encumbered, other than by will or the laws of descent and distribution.

 

SECTION 8 TAX WITHHOLDING

 

(a) Payment by Participant. Each participant shall, no later than the date as of
which the value of an Award or of any Stock or other amounts received thereunder
first becomes includable in the gross income of the participant for Federal
income tax purposes, pay to the Company, or make arrangements satisfactory to
the Committee regarding payment of, any federal, state, or local taxes of any
kind required by law to be withheld with respect to such income. The Company and
its Subsidiaries shall, to the extent permitted by law, have the right to deduct
any such taxes from any payment of any kind otherwise due to the participant.

 

(b) Payment in Stock. Subject to approval by the Committee, a participant may
elect to have the minimum required tax withholding obligation satisfied, in
whole or in part, by (i) authorizing the Company to withhold from shares of
Stock to be issued pursuant to any Award a number of shares with an aggregate
Fair Market Value (as of the date the withholding is effected) that would
satisfy the withholding amount due, or (ii) transferring to the Company shares
of Stock owned by the participant with an aggregate Fair Market Value (as of the
date the withholding is effected) that would satisfy the withholding amount due.

 

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SECTION 9 TRANSFER, LEAVE OF ABSENCE, ETC.

 

For purposes of the Plan, the following events shall not be deemed a termination
of the employment of a Plan participant by the Company or its Subsidiaries and
Affiliates:

 

(a) a transfer of employment to the Company from a Subsidiary or Affiliate, or a
transfer of employment to a Subsidiary or Affiliate from the Company, or a
transfer of employment from one Subsidiary or Affiliate to another; or

 

(b) an approved leave of absence for military service or sickness, or for any
other purpose approved by (as applicable) the Company or its Subsidiary or
Affiliate, if the employee’s right to re-employment is guaranteed either by a
statute or by contract or under the policy pursuant to which the leave of
absence was granted or if the Committee otherwise so provides in writing.

 

SECTION 10 AMENDMENTS AND TERMINATION

 

The Board may, at any time, amend or discontinue the Plan and the Committee may,
at any time, amend or cancel any outstanding Award (or provide substitute Awards
at the same or reduced exercise or purchase price or with no exercise or
purchase price in a manner not inconsistent with the terms of the Plan), but
such price, if any, must satisfy the requirements which would apply to the
substitute or amended Award if it were then initially granted under this Plan
for the purpose of satisfying changes in law or for any other lawful purpose,
but no such action shall adversely affect rights under any outstanding Award
without the holder’s consent. If and to the extent determined by the Committee
to be required by the Code to ensure that Incentive Stock Options granted under
the Plan are qualified under Section 422 of the Code, Plan amendments shall be
subject to approval by the Company’s stockholders who are eligible to vote at a
meeting of stockholders. Nothing in this Section 10 shall limit the Board’s or
Committee’s authority to take any action permitted pursuant to Section 3(c).

 

SECTION 11 STATUS OF PLAN

 

With respect to the portion of any Award that has not been exercised and any
payments in cash, Stock or other consideration not received by a participant, a
participant shall have no rights greater than those of a general creditor of the
Company unless the Committee shall otherwise expressly determine in connection
with any Award or Awards. In its sole discretion, the Committee may authorize
the creation of trusts or other arrangements to meet the Company’s obligations
to deliver Stock or make payments with respect to Awards hereunder, provided
that the existence of such trusts or other arrangements is consistent with the
foregoing sentence.

 

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SECTION 12 GENERAL PROVISIONS

 

(a) No Distribution; Compliance with Legal Requirements. The Committee may
require each person acquiring Stock pursuant to an Award to represent to and
agree with the Company in writing that such person is acquiring the shares
without a view to distribution thereof. No shares of Stock shall be issued
pursuant to an Award until all applicable securities law and other legal and
stock exchange or similar requirements have been satisfied. The Committee may
require the placing of such stop-orders and restrictive legends on certificates
for Stock and Awards as it deems appropriate.

 

(b) Delivery of Stock Certificates. Stock certificates to participants under
this Plan shall be deemed delivered for all purposes when the Company or a stock
transfer agent of the Company shall have mailed such certificates in the United
States mail, addressed to the participant, at the participant’s last known
address on file with the Company.

 

(c) Other Compensation Arrangements; No Employment Rights. Nothing contained in
this Plan shall prevent the Board from adopting other or additional compensation
arrangements, including trusts, and such arrangements may be either generally
applicable or applicable only in specific cases. The adoption of this Plan and
the grant of Awards do not confer upon any employee any right to continued
employment with the Company or any Subsidiary or Affiliate.

 

(d) Trading Policy Restrictions. Option exercises and other Awards under the
Plan shall be subject to such Company’s insider-trading-policy-related
restrictions, terms and conditions as may be established by the Committee, or in
accordance with policies set by the Committee, from time to time.

 

(e) Loans to Award Recipients. The Company shall have the authority to make
loans to recipients of Awards hereunder (including to facilitate the purchase of
shares) and shall further have the authority to issue shares for promissory
notes hereunder.

 

SECTION 13 EFFECTIVE DATE OF PLAN

 

This Plan shall become effective upon its adoption by the Board and, thereafter,
the Stock Options and other Awards may be granted hereunder; provided, however,
that no Stock may be issued hereunder prior to the approval of the Plan by the
holders of a majority of the votes cast at a meeting of stockholders at which a
quorum is present or by written consent in accordance with applicable law.

 

SECTION 14 GOVERNING LAW

 

This Plan and all Awards and actions taken thereunder shall be governed by
Nevada law, applied without regard to conflict of law principles.

 

ADOPTED BY BOARD OF DIRECTORS: /s/ Ralph Salvagno         ADOPTED ON: June 9,
2016  

 

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