Exhibit 10.1

 

COMSOVEREIGN HOLDING CORP.

 

 

2020 LONG-TERM INCENTIVE PLAN

 

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1.            Purpose. The purpose of the COMSovereign Holding Corp. 2020
Long-Term Incentive Plan (the “Plan”) is to further and promote the interests of
COMSovereign Holding Corp. (the “Company”), its Subsidiaries and its
stockholders by enabling the Company and its Subsidiaries to attract, retain and
motivate employees, directors and consultants, or those who will become
employees, directors or consultants, and to align the interests of those
individuals and the Company’s stockholders. To do this, the Plan offers
performance-based incentive awards and equity-based opportunities providing such
employees, directors and consultants with a proprietary interest in maximizing
the growth, profitability and overall success of the Company and its
Subsidiaries.

2.            Definitions. For purposes of the Plan, the following terms shall
have the meanings set forth below:

2.1               “Award” means an award or grant made to a Participant under
Sections 6, 7, 8 and/or 9 of the Plan.

2.2               “Award Agreement” means the agreement executed by a
Participant pursuant to Sections 3.2 and 15.7 of the Plan in connection with the
granting of an Award.

2.3               “Board” means the Board of Directors of the Company, as
constituted from time to time.

2.4               “Code” means the Internal Revenue Code of 1986, as in effect
and as amended from time to time, or any successor statute thereto, together
with any rules, regulations and interpretations promulgated thereunder or with
respect thereto.

2.5               “Committee” means the Compensation Committee of the Board (or
such other committee of the Board as may be established to administer the Plan,
as described in Section 3 of the Plan), or if no such committee has been
appointed or established, the Board.

2.6               “Common Stock” means the Common Stock, par value $0.001 per
share, of the Company, or any security of the Company issued by the Company in
substitution or exchange therefor.

2.7               “Company” means COMSovereign Holding Corp., a Nevada
corporation, or any successor entity to COMSovereign Holding Corp.

2.8               “Exchange Act” means the Securities Exchange Act of 1934, as
in effect and as amended from time to time, or any successor statute thereto,
together with any rules, regulations and interpretations promulgated thereunder
or with respect thereto.

2.9               “Fair Market Value” means on, or with respect to, any given
date(s), the average of the highest and lowest market prices of the Common
Stock, as reported on a public exchange for such date(s) or, if the Common Stock
was not traded on such date(s), on the next preceding day or days on which the
Common Stock was traded. If at any time the Common Stock is not traded on an
exchange, the Fair Market Value of a share of the Common Stock shall be
determined in good faith by the Board and such determination shall be conclusive
and binding on all persons.

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2.10           “Incentive Stock Option” means any stock option granted pursuant
to the provisions of Section 6 of the Plan (and the relevant Award Agreement)
that is intended to be (and is specifically designated as) an “incentive stock
option” within the meaning of Section 422 of the Code.

2.11           “Non-Employee Director” means a director serving on the Board who
is a “non-employee director” within the meaning of SEC Rule 16b-3(b)(3).

2.12           “Non-Qualified Stock Option” means any stock option granted
pursuant to the provisions of Section 6 of the Plan (and the relevant Award
Agreement) that is not (and is specifically designated as not being) an
Incentive Stock Option.

2.13           “Participant” means any individual who is selected from time to
time under Section 5 to receive an Award under the Plan.

2.14           “Performance Units” means the monetary units granted under
Section 9 of the Plan and the relevant Award Agreement.

2.15           “Plan” means the COMSovereign Holding Corp. 2020 Long-Term
Incentive Plan, as set forth herein and as in effect and as amended from time to
time (together with any rules and regulations promulgated by the Committee with
respect thereto).

2.16           “Restricted Shares” means the restricted shares of Common Stock
granted pursuant to the provisions of Section 8 of the Plan and the relevant
Award Agreement.

2.17           “Stock Appreciation Right” means an Award described in Section
7.2 of the Plan and granted pursuant to the provisions of Section 7 of the Plan.

2.18           “Subsidiary(ies)” means any corporation (other than the Company),
trust, partnership or limited liability company in an unbroken chain of
entities, including and beginning with the Company, if each of such entities,
other than the last entity in the unbroken chain, owns, directly or indirectly,
more than fifty percent (50%) of the voting shares, partnership, beneficial or
membership interests in one of the other entities in such chain.

3.             Administration.

3.1               The Committee. The Plan shall be administered by the
Committee. Subject to the last sentence of this Section 3.1, the Committee shall
be appointed from time to time by the Board and shall be comprised of not less
than two (2) of the then members of the Board who are Non-Employee Directors.
Consistent with the Bylaws of the Company, members of the Committee shall serve
at the pleasure of the Board and the Board, subject to the immediately preceding
sentence, may at any time and from time to time remove members from, or add
members to, the Committee. In the event that the Board has not appointed the
Committee, then the Board shall have all the powers of the Committee under the
Plan.

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3.2               Plan Administration and Plan Rules. The Committee is
authorized to construe and interpret the Plan and to promulgate, amend and
rescind rules and regulations relating to the implementation, administration and
maintenance of the Plan. Subject to the terms and conditions of the Plan, the
Committee shall make all determinations necessary or advisable for the
implementation, administration and maintenance of the Plan including, without
limitation, (a) selecting the Plan’s Participants, (b) making Awards in such
amounts and form as the Committee shall determine, (c) imposing such
restrictions, terms and conditions upon such Awards as the Committee shall deem
appropriate, and (d) correcting any technical defect(s) or technical
omission(s), or reconciling any technical inconsistency(ies), in the Plan and/or
any Award Agreement. The Committee may designate persons other than members of
the Committee to carry out the day-to-day ministerial administration of the Plan
under such conditions and limitations as it may prescribe, except that the
Committee shall not delegate its authority with regard to the selection for
participation in the Plan and/or the granting of any Awards to Participants. The
Committee’s determinations under the Plan need not be uniform and may be made
selectively among Participants, whether or not such Participants are similarly
situated. Any determination, decision or action of the Committee in connection
with the construction, interpretation, administration, implementation or
maintenance of the Plan shall be final, conclusive and binding upon all
Participants and any person(s) claiming under or through any Participants. The
Company shall effect the granting of Awards under the Plan, in accordance with
the determinations made by the Committee, by execution of written agreements
and/or other instruments in such form as is approved by the Committee. The
Committee may, in its sole discretion, delegate its authority to one or more
senior executive officers for the purpose of making Awards to Participants who
are not subject to Section 16 of the Exchange Act.

3.3               Liability Limitation. Neither the Board nor the Committee, nor
any member of either, shall be liable for any act, omission, interpretation,
construction or determination made in good faith in connection with the Plan (or
any Award Agreement), and the members of the Board and the Committee shall be
entitled to indemnification and reimbursement by the Company in respect of any
claim, loss, damage or expense (including, without limitation, attorneys’ fees)
arising or resulting therefrom to the fullest extent permitted by law and/or
under any directors and officers liability insurance coverage which may be in
effect from time to time.

4.            Term of Plan/Common Stock Subject to Plan.

4.1               Term. Unless terminated earlier by the Board, the Plan shall
terminate on May 1, 2030, except with respect to Awards then outstanding. After
such date no further Awards shall be granted under the Plan.

4.2               Common Stock. The maximum number of shares of Common Stock in
respect of which Awards may be granted or paid out under the Plan, subject to
adjustment as provided in Section 13.2 of the Plan, shall not exceed ten million
(10,000,000) shares; all of which may be issued pursuant to the exercise of
Incentive Stock Options. In the event of a change in the Common Stock of the
Company that is limited to a change in the designation thereof to “Capital
Stock” or other similar designation, or to a change in the par value thereof, or
from par value to no par value, without increase or decrease in the number of
issued shares, the shares resulting from any such change shall be deemed to be
the Common Stock for purposes of the Plan. Common Stock which may be issued
under the Plan may be either authorized and unissued shares or issued shares
which have been reacquired by the Company (in the open-market or in private
transactions) and which are being held as treasury shares. No fractional shares
of Common Stock shall be issued under the Plan.

4.3               Computation of Available Shares. For the purpose of computing
the total number of shares of Common Stock available for Awards under the Plan,
there shall be counted against the limitations set forth in Section 4.2 of the
Plan the maximum number of shares of Common Stock potentially subject to
issuance upon exercise or settlement of Awards granted under Sections 6 and 7 of
the Plan, the number of shares of Common Stock issued under grants of Restricted
Shares pursuant to Section 8 of the Plan and the maximum number of shares of
Common Stock potentially issuable under grants or payments of Performance Units
pursuant to Section 9 of the Plan, in each case determined as of the date on
which such Awards are granted. If any Awards expire unexercised or are
forfeited, surrendered, cancelled, terminated or settled in cash in lieu of
Common Stock, the shares of Common Stock which were theretofore subject (or
potentially subject) to such Awards shall again be available for Awards under
the Plan to the extent of such expiration, forfeiture, surrender, cancellation,
termination or settlement of such Awards.

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5.           Eligibility. Individuals eligible for Awards under the Plan shall
consist of employees, directors and consultants, or those who will become
employees, directors or consultants, of the Company and/or its Subsidiaries
whose performance or contribution, in the sole discretion of the Committee,
benefits or will benefit the Company or any Subsidiary. Notwithstanding the
above, Incentive Stock Options may only be granted to employees of the Company.

6.            Stock Options.

6.1               Terms and Conditions. Stock options granted under the Plan
shall be in respect of Common Stock and may be in the form of Incentive Stock
Options or Non-Qualified Stock Options (sometimes referred to collectively
herein as the “Stock Option(s)”). All Stock Options shall be separately
designated Incentive Stock Options or Non-Qualified Stock Options at the time of
grant, and, if certificates are issued, a separate certificate or certificates
will be issued for shares of Common Stock purchased on exercise of each type of
Option. Notwithstanding the foregoing, the Company shall have no liability to
any Participant or any other person if a Stock Option designated as an Incentive
Stock Option fails to qualify as such at any time or if a Stock Option is
determined to constitute "nonqualified deferred compensation" within the meaning
of Section 409A of the Code and the terms of such Stock Option do not satisfy
the requirements of Section 409A of the Code. Such Stock Options shall be
subject to the terms and conditions set forth in this Section 6 and any
additional terms and conditions, not inconsistent with the express terms and
provisions of the Plan, as the Committee shall set forth in the relevant Award
Agreement.

6.2               Grant. Stock Options may be granted under the Plan in such
form as the Committee may from time to time approve. Stock Options may be
granted alone or in addition to other Awards under the Plan or in tandem with
Stock Appreciation Rights. Special provisions shall apply to Incentive Stock
Options granted to any employee who owns (within the meaning of Section
422(b)(6) of the Code) more than ten percent (10%) of the total combined voting
power of all classes of stock of the Company or its parent corporation or any
subsidiary of the Company, within the meaning of Sections 424(e) and (f) of the
Code (a “10% Stockholder”).

6.3               Exercise Price. The exercise price per share of Common Stock
subject to a Stock Option shall be determined by the Committee; provided,
however, that the exercise price of a Stock Option shall not be less than one
hundred percent (100%) of the Fair Market Value of the Common Stock on the date
of the grant of such Stock Option; provided, further, however, that, in the case
of a 10% Stockholder, the exercise price of an Incentive Stock Option shall not
be less than one hundred ten percent (110%) of the Fair Market Value of the
Common Stock on the date of grant. This Section 6.3 shall not apply to a Stock
Option granted pursuant to the assumption of, or substitution for, another
security in a manner that complies with section 424(a) of the Code (whether or
not the Stock Option is an Incentive Stock Option).

6.4               Term. The term of each Stock Option shall be such period of
time as is fixed by the Committee; provided, however, that the term of any
Incentive Stock Option shall not exceed ten (10) years (five (5) years, in the
case of a 10% Stockholder) after the date immediately preceding the date on
which the Incentive Stock Option is granted.

6.5               Method of Exercise. A Stock Option may be exercised, in whole
or in part, by giving written notice of exercise to the Secretary of the
Company, or the Secretary’s designee, specifying the number of shares to be
purchased. Such notice shall be accompanied by payment in full of the exercise
price (and applicable tax withholding) in cash, by certified check, bank draft,
or money order payable to the order of the Company, or, if permitted by the
Committee in its sole discretion, by delivery of shares of Common Stock
satisfying such requirements as the Committee shall establish, or through such
other mechanism as the Committee shall permit, in its sole discretion. Payment
instruments shall be received by the Company subject to collection. The proceeds
received by the Company upon exercise of any Stock Option may be used by the
Company for general corporate purposes. Any portion of a Stock Option that is
exercised may not be exercised again.

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6.6               Tandem Grants. If Non-Qualified Stock Options and Stock
Appreciation Rights are granted in tandem, as designated in the relevant Award
Agreements, the right of a Participant to exercise any such tandem Stock Option
shall terminate to the extent that the shares of Common Stock subject to such
Stock Option are used to calculate amounts or shares receivable upon the
exercise of the related tandem Stock Appreciation Right.

6.7               Incentive Stock Option $100,000 Limitation. To the extent that
the aggregate Fair Market Value (determined at the time of grant) of Common
Stock with respect to which Incentive Stock Options are exercisable for the
first time by any Participant during any calendar year (under all plans of
the Company and its affiliates) exceeds $100,000, the Stock Options or portions
thereof which exceed such limit (according to the order in which they were
granted) shall be treated as Non-Qualified Stock Options.

7.            Stock Appreciation Rights.

7.1               Terms and Conditions. The grant of Stock Appreciation Rights
under the Plan shall be subject to the terms and conditions set forth in this
Section 7 and any additional terms and conditions, not inconsistent with the
express terms and provisions of the Plan, as the Committee shall set forth in
the relevant Award Agreement.

7.2               Stock Appreciation Rights. A Stock Appreciation Right is an
Award granted with respect to a specified number of shares of Common Stock
entitling a Participant to receive an amount equal to the excess of the Fair
Market Value of a share of Common Stock on the date of exercise over the Fair
Market Value of a share of Common Stock on the date of grant of the Stock
Appreciation Right, multiplied by the number of shares of Common Stock with
respect to which the Stock Appreciation Right shall have been exercised.

7.3               Grant. A Stock Appreciation Right may be granted in addition
to any other Award under the Plan or in tandem with or independent of a
Non-Qualified Stock Option.

7.4               Date of Exercisability. In respect of any Stock Appreciation
Right granted under the Plan, unless otherwise (a) determined by the Committee
(in its sole discretion) at any time and from time to time in respect of any
such Stock Appreciation Right, or (b) provided in the Award Agreement, a Stock
Appreciation Right may be exercised by a Participant, in accordance with and
subject to all of the procedures established by the Committee, in whole or in
part at any time and from time to time during its specified term. The Committee
may also provide, as set forth in the relevant Award Agreement and without
limitation, that some Stock Appreciation Rights shall be automatically exercised
and settled on one or more fixed dates specified therein by the Committee.

7.5               Form of Payment. Upon exercise of a Stock Appreciation Right,
payment may be made in cash, in Restricted Shares or in shares of unrestricted
Common Stock, or in any combination thereof, as the Committee, in its sole
discretion, shall determine and provide in the relevant Award Agreement.

7.6               Tandem Grant. The right of a Participant to exercise a tandem
Stock Appreciation Right shall terminate to the extent such Participant
exercises the Non-Qualified Stock Option to which such Stock Appreciation Right
is related.

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8.             Restricted Shares.

8.1               Terms and Conditions. Grants of Restricted Shares shall be
subject to the terms and conditions set forth in this Section 8 and any
additional terms and conditions, not inconsistent with the express terms and
provisions of the Plan, as the Committee shall set forth in the relevant Award
Agreement. Restricted Shares may be granted alone or in addition to any other
Awards under the Plan. Subject to the terms of the Plan, the Committee shall
determine the number of Restricted Shares to be granted to a Participant and the
Committee may provide or impose different terms and conditions on any particular
Restricted Share grant made to any Participant. With respect to each Participant
receiving an Award of Restricted Shares, there shall be issued a stock
certificate (or certificates) in respect of such Restricted Shares. Such stock
certificate(s) shall be registered in the name of such Participant, shall be
accompanied by a stock power duly executed by such Participant, and shall bear,
among other required legends, the following legend:

“The transferability of this certificate and the shares of stock represented
hereby are subject to the terms and conditions (including, without limitation,
forfeiture events) contained in the COMSovereign Holding Corp. 2020 Long-Term
Incentive Plan and an Award Agreement entered into between the registered owner
hereof and COMSovereign Holding Corp. Copies of such Plan and Award Agreement
are on file in the office of the Secretary of COMSovereign Holding Corp.
COMSovereign Holding Corp. will furnish to the recordholder of the certificate,
without charge and upon written request at its principal place of business, a
copy of such Plan and Award Agreement. COMSovereign Holding Corp. reserves the
right to refuse to record the transfer of this certificate until all such
restrictions are satisfied, all such terms are complied with and all such
conditions are satisfied.”

Such stock certificate evidencing such shares shall, in the sole discretion of
the Committee, be deposited with and held in custody by the Company until the
restrictions thereon shall have lapsed and all of the terms and conditions
applicable to such grant shall have been satisfied.

8.2               Restricted Share Grants. A grant of Restricted Shares is an
Award of shares of Common Stock granted to a Participant, subject to such
restrictions, terms and conditions as the Committee deems appropriate,
including, without limitation, (a) restrictions on the sale, assignment,
transfer, hypothecation or other disposition of such shares, (b) the requirement
that the Participant deposit such shares with the Company while such shares are
subject to such restrictions, and (c) the requirement that such shares be
forfeited upon termination of employment or service with the Company for any
reason or for specified reasons within a specified period of time or for other
reasons (including, without limitation, the failure to achieve designated
performance goals).

8.3               Restriction Period. In accordance with Sections 8.1 and 8.2 of
the Plan and unless otherwise determined by the Committee (in its sole
discretion) at any time and from time to time, Restricted Shares shall only
become unrestricted and vested in the Participant in accordance with such
vesting schedule relating to such Restricted Shares, if any, as the Committee
may establish in the relevant Award Agreement (the “Restriction Period”). During
the Restriction Period, such stock shall be and remain unvested and a
Participant may not sell, assign, transfer, pledge, encumber or otherwise
dispose of or hypothecate such Award. Upon satisfaction of the vesting schedule
and any other applicable restrictions, terms and conditions, the Participant
shall be entitled to receive payment of the Restricted Shares or a portion
thereof, as the case may be, as provided in Section 8.4 of the Plan.

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8.4               Payment of Restricted Share Grants. After the satisfaction
and/or lapse of the restrictions, terms and conditions established by the
Committee in respect of a grant of Restricted Shares, a new certificate, without
the legend set forth in Section 8.1 of the Plan, for the number of shares of
Common Stock which are no longer subject to such restrictions, terms and
conditions shall, as soon as practicable thereafter, be delivered to the
Participant, provided that the removal of such legend is permitted by applicable
federal and state securities laws.

8.5               Stockholder Rights. A Participant shall have, with respect to
the shares of Common Stock underlying a grant of Restricted Shares, all of the
rights of a stockholder of such stock (except as such rights are limited or
restricted under the Plan or in the relevant Award Agreement). Any stock
dividends paid in respect of unvested Restricted Shares shall be treated as
additional Restricted Shares and shall be subject to the same restrictions and
other terms and conditions that apply to the unvested Restricted Shares in
respect of which such stock dividends are issued.

9.             Performance Units.

9.1               Terms and Conditions. Performance Units shall be subject to
the terms and conditions set forth in this Section 9 and any additional terms
and conditions, not inconsistent with the express provisions of the Plan, as the
Committee shall set forth in the relevant Award Agreement.

9.2               Performance Unit Grants. A Performance Unit is an Award of
units (with each unit representing such monetary amount as is designated by the
Committee in the Award Agreement) granted to a Participant, subject to such
terms and conditions as the Committee deems appropriate, including, without
limitation, the requirement that the Participant forfeit such units (or a
portion thereof) in the event certain performance criteria or other conditions
are not met within a designated period of time.

9.3               Grants. Performance Units may be granted alone or in addition
to any other Awards under the Plan. Subject to the terms of the Plan, the
Committee shall determine the number of Performance Units to be granted to a
Participant and the Committee may impose different terms and conditions on any
particular Performance Units granted to any Participant.

9.4               Performance Goals and Performance Periods. Participants
receiving a grant of Performance Units shall only earn into and be entitled to
payment in respect of such Awards if the Company and/or the Participant achieves
certain performance goals (the “Performance Goals”) during and in respect of a
designated performance period (the “Performance Period”). The Performance Goals
and the Performance Period shall be established by the Committee, in its sole
discretion. The Committee shall establish Performance Goals for each Performance
Period prior to, or as soon as practicable after, the commencement of such
Performance Period. The Committee shall also establish a schedule or schedules
for Performance Units setting forth the portion of the Award which will be
earned or forfeited based on the degree of achievement, or lack thereof, of the
Performance Goals at the end of the relevant Performance Period. In setting
Performance Goals, the Committee may use, but shall not be limited to, such
measures as total stockholder return, return on equity, net earnings growth,
sales or revenue growth, cash flow, comparisons to peer companies, individual or
aggregate Participant performance or such other measure or measures of
performance as the Committee, in its sole discretion, may deem appropriate. Such
performance measures shall be defined as to their respective components and
meaning by the Committee (in its sole discretion). During any Performance
Period, the Committee shall have the authority to adjust the Performance Goals
and/or the Performance Period in such manner as the Committee, in its sole
discretion, deems appropriate at any time and from time to time.

9.5               Payment of Units. With respect to each Performance Unit, the
Participant shall, if the applicable Performance Goals have been achieved, or
partially achieved, as determined by the Committee in its sole discretion, by
the Company and/or the Participant during the relevant Performance Period, be
entitled to receive payment in an amount equal to the designated value of each
Performance Unit times the number of such units so earned. Payment in settlement
of earned Performance Units shall be made as soon as practicable following the
conclusion of the respective Performance Period in cash, in unrestricted Common
Stock, or in Restricted Shares, or in any combination thereof, as the Committee,
in its sole discretion, shall determine and provide in the relevant Award
Agreement.

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10.          Other Provisions.

10.1           Performance-Based Awards. Performance Units, Restricted Shares,
and other Awards subject to performance criteria shall be paid solely on account
of the attainment of one or more pre-established performance goals. Until
otherwise determined by the Committee, the performance goals shall be the
attainment of pre-established levels of any of net income, market price per
share, earnings per share, return on equity, return on capital employed and/or
cash flow, regulatory approval of products, strategic alliances and joint
ventures and patent issuances.

 

11.         Dividend Equivalents. In addition to the provisions of Section 8.5
of the Plan, Awards of Stock Options, and/or Stock Appreciation Rights, may, in
the sole discretion of the Committee and if provided for in the relevant Award
Agreement, earn dividend equivalents. In respect of any such Award which is
outstanding on a dividend record date for Common Stock, the Participant shall be
credited with an amount equal to the amount of cash or stock dividends that
would have been paid on the shares of Common Stock covered by such Award had
such covered shares been issued and outstanding on such dividend record date.
The Committee shall establish such rules and procedures governing the crediting
of such dividend equivalents, including, without limitation, the amount, timing,
form of payment and payment contingencies and/or restrictions of such dividend
equivalents, as it deems appropriate or necessary.

12.          Non-transferability of Awards. Unless otherwise provided in the
Award Agreement, no Award under the Plan or any Award Agreement, and no rights
or interests herein or therein, shall or may be assigned, transferred, sold,
exchanged, encumbered, pledged, or otherwise hypothecated or disposed of by a
Participant or any beneficiary(ies) of any Participant, except by testamentary
disposition by the Participant or the laws of intestate succession. No such
interest shall be subject to execution, attachment or similar legal process,
including, without limitation, seizure for the payment of the Participant’s
debts, judgments, alimony, or separate maintenance. Unless otherwise provided in
the Award Agreement, during the lifetime of a Participant, Stock Options and
Stock Appreciation Rights are exercisable only by the Participant.

13.          Changes in Capitalization and Other Matters.

13.1           No Corporate Action Restriction. The existence of the Plan, any
Award Agreement and/or the Awards granted hereunder shall not limit, affect or
restrict in any way the right or power of the Board or the stockholders of the
Company to make or authorize (a) any adjustment, recapitalization,
reorganization or other change in the Company’s or any Subsidiary’s capital
structure or its business, (b) any merger, consolidation or change in the
ownership of the Company or any Subsidiary, (c) any issue of bonds, debentures,
capital, preferred or prior preference stocks ahead of or affecting the
Company’s or any Subsidiary’s capital stock or the rights thereof, (d) any
dissolution or liquidation of the Company or any Subsidiary, (e) any sale or
transfer of all or any part of the Company’s or any Subsidiary’s assets or
business, or (f) any other corporate act or proceeding by the Company or any
Subsidiary. No Participant, beneficiary or any other person shall have any claim
against any member of the Board or the Committee, the Company or any Subsidiary,
or any employees, officers, stockholders or agents of the Company or any
subsidiary, as a result of any such action.

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13.2           Recapitalization Adjustments. In the event that the Board
determines that any dividend or other distribution (whether in the form of cash,
Common Stock, other securities, or other property), recapitalization, stock
split, reverse stock split, reorganization, merger, consolidation, split-up,
spin-off, combination, repurchase, or exchange of Common Stock or other
securities of the Company, or other corporate transaction or event affects the
Common Stock such that an adjustment is determined by the Board, in its sole
discretion, to be necessary or appropriate in order to prevent dilution or
enlargement of benefits or potential benefits intended to be made available
under the Plan, the Board may, in such manner as it in good faith deems
equitable, adjust any or all of (i) the number of shares of Common Stock or
other securities of the Company (or number and kind of other securities or
property) with respect to which Awards may be granted, (ii) the number of shares
of Common Stock or other securities of the Company (or number and kind of other
securities or property) subject to outstanding Awards, and (iii) the exercise
price with respect to any Stock Option, or make provision for an immediate cash
payment to the holder of an outstanding Award in consideration for the
cancellation of such Award.

13.3           Mergers. If the Company enters into or is involved in any merger,
reorganization, recapitalization, sale of all or substantially all of the
Company’s assets, liquidation, or business combination with any person or entity
(such merger, reorganization, recapitalization, sale of all or substantially all
of the Company’s assets, liquidation, or business combination to be referred to
herein as a “Merger Event”), the Board may take such action as it deems
appropriate, including, but not limited to, replacing such Stock Options with
substitute stock options and/or stock appreciation rights in respect of the
shares, other securities or other property of the surviving corporation or any
affiliate of the surviving corporation on such terms and conditions, as to the
number of shares, pricing and otherwise, which shall substantially preserve the
value, rights and benefits of any affected Stock Options or Stock Appreciation
Rights granted hereunder as of the date of the consummation of the Merger Event.
Notwithstanding anything to the contrary in the Plan, if any Merger Event
occurs, the Company shall have the right, but not the obligation, to cancel each
Participant's Stock Options and/or Stock Appreciation Rights and to pay to each
affected Participant in connection with the cancellation of such Participant's
Stock Options and/or Stock Appreciation Rights, an amount equal to the excess of
the Fair Market Value, as determined by the Board, of the Common Stock
underlying any unexercised Stock Options or Stock Appreciation Rights (whether
then exercisable or not) over the aggregate exercise price of such unexercised
Stock Options and/or Stock Appreciation Rights.  In the case of any Stock Option
or Stock Appreciation Right with an exercise price that equals or exceeds the
price paid for a share of Common Stock in connection with the Merger Event, the
Committee may cancel the Stock Option or Stock Appreciation Right without the
payment of consideration therefor.

Upon receipt by any affected Participant of any such substitute stock options,
stock appreciation rights (or payment) as a result of any such Merger Event,
such Participant’s affected Stock Options and/or Stock Appreciation Rights for
which such substitute options and/or stock appreciation rights (or payment) were
received shall be thereupon cancelled without the need for obtaining the consent
of any such affected Participant.

 

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14.           Amendment, Suspension and Termination.

14.1           In General. The Board may suspend or terminate the Plan (or any
portion thereof) at any time and may amend the Plan at any time and from time to
time in such respects as the Board may deem advisable to insure that any and all
Awards conform to or otherwise reflect any change in applicable laws or
regulations, or to permit the Company or the Participants to benefit from any
change in applicable laws or regulations, or in any other respect the Board may
deem to be in the best interests of the Company or any Subsidiary. No such
amendment, suspension or termination shall (x) materially adversely affect the
rights of any Participant under any outstanding Stock Options, Stock
Appreciation Rights, Performance Units, or Restricted Share grants, without the
consent of such Participant, (y) increase the number of shares available for
Awards pursuant to Section 4.2, or (z) change the performance criteria listed in
Section 10.1, without stockholder approval; provided, however, that the Board
may amend the Plan, without the consent of any Participants, in any way it deems
appropriate to satisfy Code Section 409A and any regulations or other authority
promulgated thereunder, including any amendment to the Plan to cause certain
Awards not to be subject to Code Section 409A.

14.2           Award Agreement Modifications. The Committee may (in its sole
discretion) amend or modify at any time and from time to time the terms and
provisions of any outstanding Stock Options, Stock Appreciation Rights,
Performance Units, or Restricted Share grants, in any manner to the extent that
the Committee under the Plan or any Award Agreement could have initially
determined the restrictions, terms and provisions of such Stock Options, Stock
Appreciation Rights, Performance Units, and/or Restricted Share grants,
including, without limitation, changing or accelerating (a) the date or dates as
of which such Stock Options or Stock Appreciation Rights shall become
exercisable, (b) the date or dates as of which such Restricted Share grants
shall become vested, or (c) the performance period or goals in respect of any
Performance Units. No such amendment or modification shall, however, materially
adversely affect the rights of any Participant under any such Award without the
consent of such Participant; provided, however, that the Committee may amend an
Award without the consent of the Participant, in any way it deems appropriate to
satisfy Code Section 409A and any regulations or other authority promulgated
thereunder, including any amendment to or modification of such Award to cause
such Award not to be subject to Code Section 409A.

15.           Miscellaneous.

15.1           Tax Withholding. The Company shall have the right to deduct from
any payment or settlement under the Plan, including, without limitation, the
exercise of any Stock Option or Stock Appreciation Right, or the delivery,
transfer or vesting of any Common Stock or Restricted Shares, any federal,
state, local or other taxes of any kind which the Committee, in its sole
discretion, deems necessary to be withheld to comply with the Code and/or any
other applicable law, rule or regulation. Shares of Common Stock may be used to
satisfy any such tax withholding. Such Common Stock shall be valued based on the
Fair Market Value of such stock as of the date the tax withholding is required
to be made, such date to be determined by the Committee. In addition, the
Company shall have the right to require payment from a Participant to cover any
applicable withholding or other employment taxes due upon any payment or
settlement under the Plan.

15.2           No Right to Employment or Continuing Relationship. Neither the
adoption of the Plan, the granting of any Award, nor the execution of any Award
Agreement, shall confer upon any employee, director, or consultant of the
Company or any Subsidiary any right to continued employment, directorship, or
consulting relationship with the Company or any Subsidiary, as the case may be,
nor shall it interfere in any way with the right, if any, of the Company or any
Subsidiary to terminate the employment, directorship, or consulting relationship
of any employee, director, or consultant at any time for any reason, even if
such termination adversely affects such Participant’s Awards.

15.3           Unfunded Plan. The Plan shall be unfunded and the Company shall
not be required to segregate any assets in connection with any Awards under the
Plan. Any liability of the Company to any person with respect to any Award under
the Plan or any Award Agreement shall be based solely upon the contractual
obligations that may be created as a result of the Plan or any such award or
agreement. No such obligation of the Company shall be deemed to be secured by
any pledge of, encumbrance on, or other interest in, any property or asset of
the Company or any Subsidiary. Nothing contained in the Plan or any Award
Agreement shall be construed as creating in respect of any Participant (or
beneficiary thereof or any other person) any equity or other interest of any
kind in any assets of the Company or any Subsidiary or creating a trust of any
kind or a fiduciary relationship of any kind between the Company, any Subsidiary
and/or any such Participant, any beneficiary thereof or any other person.

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15.4           Payments to a Trust. The Committee is authorized to cause to be
established a trust agreement or several trust agreements or similar
arrangements from which the Committee may make payments of amounts due or to
become due to any Participants under the Plan.

15.5           Other Company Benefit and Compensation Programs. Payments and
other benefits received by a Participant under an Award made pursuant to the
Plan shall not be deemed a part of a Participant’s compensation for purposes of
the determination of benefits under any other employee welfare or benefit plans
or arrangements, if any, provided by the Company or any Subsidiary unless
expressly provided in such other plans or arrangements, or except where the
Board expressly determines in writing that inclusion of an Award or portion of
an Award should be included to accurately reflect competitive compensation
practices or to recognize that an Award has been made in lieu of a portion of
competitive annual base salary or other cash compensation. Awards under the Plan
may be made in addition to, in combination with, or as alternatives to, grants,
awards or payments under any other plans or arrangements of the Company or its
Subsidiaries. The existence of the Plan notwithstanding, the Company or any
Subsidiary may adopt such other compensation plans or programs and additional
compensation arrangements as it deems necessary to attract, retain and motivate
employees.

15.6           Listing, Registration and Other Legal Compliance. No Awards or
shares of the Common Stock shall be required to be issued or granted under the
Plan unless legal counsel for the Company shall be satisfied that such issuance
or grant will be in compliance with all applicable federal and state securities
laws and regulations and any other applicable laws or regulations. The Committee
may require, as a condition of any payment or share issuance, that certain
agreements, undertakings, representations, certificates, and/or information, as
the Committee may deem necessary or advisable, be executed or provided to the
Company to assure compliance with all such applicable laws or regulations.
Certificates for shares of the Restricted Shares and/or Common Stock delivered
under the Plan may be subject to such stock-transfer orders and such other
restrictions as the Committee may deem advisable under the rules, regulations,
or other requirements of the Securities and Exchange Commission, any stock
exchange upon which the Common Stock is then listed, and any applicable federal
or state securities law. In addition, if, at any time specified herein (or in
any Award Agreement or otherwise) for (a) the making of any Award, or the making
of any determination, (b) the issuance or other distribution of Restricted
Shares and/or Common Stock, or (c) the payment of amounts to or through a
Participant with respect to any Award, any law, rule, regulation or other
requirement of any governmental authority or agency shall require either the
Company, any Subsidiary or any Participant (or any estate, designated
beneficiary or other legal representative thereof) to take any action in
connection with any such determination, any such shares to be issued or
distributed, any such payment, or the making of any such determination, as the
case may be, shall be deferred until such required action is taken. With respect
to persons subject to Section 16 of the Exchange Act, transactions under the
Plan are intended to comply with all applicable conditions of Rule 16b-3
promulgated under the Exchange Act.

15.7           Award Agreements. Each Participant receiving an Award under the
Plan shall enter into an Award Agreement with the Company in a form specified by
the Committee. Each such Participant shall agree to the restrictions, terms and
conditions of the Award set forth therein and in the Plan.

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15.8           Designation of Beneficiary. Each Participant to whom an Award has
been made under the Plan may designate a beneficiary or beneficiaries to
exercise any option or to receive any payment which under the terms of the Plan
and the relevant Award Agreement may become exercisable or payable on or after
the Participant’s death. At any time, and from time to time, any such
designation may be changed or cancelled by the Participant without the consent
of any such beneficiary. Any such designation, change or cancellation must be on
a form provided for that purpose by the Committee and shall not be effective
until received by the Committee. If no beneficiary has been designated by a
deceased Participant, or if the designated beneficiaries have predeceased the
Participant, the beneficiary shall be the Participant’s estate. If the
Participant designates more than one beneficiary, any payments under the Plan to
such beneficiaries shall be made in equal shares unless the Participant has
expressly designated otherwise, in which case the payments shall be made in the
shares designated by the Participant.

15.9           Leaves of Absence/Transfers. The Committee shall have the power
to promulgate rules and regulations and to make determinations, as it deems
appropriate, under the Plan in respect of any leave of absence from the Company
or any Subsidiary granted to a Participant. Without limiting the generality of
the foregoing, the Committee may determine whether any such leave of absence
shall be treated as if the Participant has terminated employment with the
Company or any such Subsidiary. If a Participant transfers within the Company,
or to or from any Subsidiary, such Participant shall not be deemed to have
terminated employment as a result of such transfers.

15.10        Clawback. Notwithstanding any other provisions in this Plan,
the Company may cancel any Award, require reimbursement of any Award by a
Participant, and effect any other right of recoupment of equity or other
compensation provided under the Plan in accordance with any Company policies
that may be adopted and/or modified from time to time ("Clawback Policy"). In
addition, a Participant may be required to repay to the Company previously paid
compensation, whether provided pursuant to the Plan or an Award Agreement, in
accordance with the Clawback Policy. By accepting an Award, the Participant is
agreeing to be bound by the Clawback Policy, as in effect or as may be adopted
and/or modified from time to time by the Company in its discretion (including,
without limitation, to comply with applicable law or stock exchange listing
requirements).

15.11        Code Section 409A. This Plan and all Awards hereunder are intended
to comply with the requirements of Code Section 409A and any regulations or
other authority promulgated thereunder. Notwithstanding any provision of the
Plan or any Award Agreement to the contrary, the Board and the Committee reserve
the right (without the consent of any Participant and without any obligation to
do so or to indemnify any Participant or the beneficiaries of any Participant
for any failure to do so) to amend this Plan and/or any Award Agreement as and
when necessary or desirable to conform to or otherwise properly reflect any
guidance issued under Code Section 409A after the date hereof without violating
Code Section 409A. In the event that any payment or benefit made hereunder would
constitute payments or benefits pursuant to a non-qualified deferred
compensation plan within the meaning of Code Section 409A and, at the time of a
Participant‘s “separation from service”, such Participant is a “specified
employee” within the meaning of Code Section 409A, then any such payments or
benefits shall be delayed until the six-month anniversary of the date of such
Participant’s “separation from service”. Each payment made under this Plan shall
be designated as a “separate payment” within the meaning of Code Section 409A.

15.12        Governing Law. The Plan and all actions taken thereunder shall be
governed by and construed in accordance with the laws of the State of Nevada,
without reference to the principles of conflict of laws thereof. Any titles and
headings herein are for reference purposes only, and shall in no way limit,
define or otherwise affect the meaning, construction or interpretation of any
provisions of the Plan.

15.13        Effective Date. The Plan shall be effective upon its approval by
the Board and adoption by the Company, subject to the approval of the Plan by
the Company’s stockholders in accordance with Section 422 of the Code. If such
stockholder approval is not obtained, the Plan and any awards granted under the
Plan shall be null and void and of no force and effect.

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IN WITNESS WHEREOF, this Plan is adopted by the Company on this 6th day of May,
2020.

 

  COMSOVEREIGN HOLDING CORP       By:  /s/ Daniel L. Hodges     Name: Daniel L.
Hodges
Title:   Chief Executive Officer

 

 

 

 

 

 

 

 

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