Exhibit 10.1


 


NUTRIBAND
INC.


2021 EMPLOYEE STOCK OPTION
PLAN


 


1.
Purpose


 


The proper execution of the duties and responsibilities
of the executives, directors, and key employees of Nutriband Inc. (the “Corporation”), as well as consultants to the Corporation,
is a vital factor in the continued growth and success of the Corporation. Toward this end, it is necessary to attract and retain effective
and capable individuals to assume positions and provide services that contribute materially to the successful operation of the business
of the Corporation. It will benefit the Corporation, therefore, to bind the interests of these persons more closely to its own interests
by offering them an attractive opportunity to acquire a proprietary interest in the Corporation and thereby provide them with added incentive
to remain in the service of or provide services to the Corporation and to increase the prosperity, growth, and earnings of the Corporation.
This stock option plan is intended to serve these purposes.


 


2.
Definitions


 


The following terms wherever used herein shall have the meanings
set forth below.


 


“Board of Directors” or “Board”
shall mean the Board of Directors of the Corporation.


 


“Code” shall mean the Internal
Revenue Code of 1986, as amended, and any regulations promulgated thereunder.


 


“Committee” shall mean a committee
to be appointed by the Board of Directors in accordance with Section 4(a) of the Plan.


 


“Common Stock” shall mean the
shares of common stock of the Corporation, including both the voting and any non-voting classes of stock.


 


“Corporation” shall mean Nutriband
Inc., a Nevada corporation.


 


“Employee” shall mean a common
law employee of the Corporation or a Parent or a Subsidiary.


 


“Employment” means periods during
which an Employee qualifies as an Employee.


 


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


 


“Fair Market Value” of the Common
Stock on any date shall be (a) the average on that date of the high and low prices of a share of Common Stock on The Nasdaq Capital Market;
or (b) such other value as the Board reasonably determines is a more accurate indication of the fair market value of the Common Stock.


 


“Immediate Family Member” shall
mean each of (a) the children, step children or grandchildren of the Employee to whom the Option is granted, (b) the spouse or any parent
of the Employee to whom the Option is granted, (c) any trust solely for the benefit of any such family members, and (iv) any partnership
or other entity in which such family members are the only partners or other equity holders.


 


“Incentive Stock Option” shall
mean any Option granted pursuant to the Plan that is designated as an Incentive Stock Option and which satisfies the requirements of Section
422(b) of the Code.


 


“Nonstatutory Stock Option”
shall mean any Option granted pursuant to the Plan that is not an Incentive Stock Option.


 


“Option” or “Stock
Option” shall mean a right granted pursuant to the Plan to purchase shares of Common Stock, and shall include the terms “Incentive
Stock Option” and “Nonstatutory Stock Option”.


 


“Optionee” shall mean an Employee
who is granted an Option under this Plan.


 


“Option Agreement” shall mean
a written agreement representing Options granted pursuant to the Plan, as contemplated by Section 7 of the Plan.


 


“Option Holder” means the Optionee
or, if applicable, the person to whom the Optionee’s rights under the Option Agreement shall have been validly transferred.


 






    


     


    

 


“Parent” shall mean a “parent
company” of the Corporation, whether now or hereafter existing, as defined in Section 424(e) of the Code.


 


“Plan” shall mean the Nutriband
Inc. 2021 Employee Stock Incentive Plan as originally approved by the Board of Directors on October 29, 2021, as embodied in this document,
and as the same may be amended from time to time.


 


“Restricted Share” shall have
the meaning set forth in Section 4(c).


 


“Restricted Stock Award” shall
have the meaning set forth in Section 4(c).


 


“Share” shall mean a share of
the Common Stock of the Corporation that is subject to an Option or Restricted Stock Award, as adjusted in accordance with Section 9 of
the Plan.


 


“Subsidiary” shall mean a “subsidiary
corporation” of Corporation or a Parent, whether now or hereafter existing, as defined in Section 424(f) of the Code.


 


3.
Effective Date of the Plan


 


The Plan shall become effective upon stockholder
approval pursuant to Section 15 of the Plan, provided that such approval is received before the expiration of one year from the date the
Plan is approved by the Board of Directors, and provided further that the Board of Directors may grant Options pursuant to the Plan prior
to stockholder approval if such Options by their terms are contingent upon subsequent stockholder approval of the Plan.


 


4. Administration


 


(a) Procedure.


 


(i) Administration
With Respect to Directors and Officers. With respect to grants of Options to Employees who are also officers or directors of the Corporation,
the Plan shall be administered by (A) the Board, if the Board may administer the Plan in compliance with Rule 16b-3 promulgated under
the Exchange Act or any successor thereto (“Rule 16b-3”) with respect to a plan intended to qualify thereunder as a discretionary
plan, or (B) a committee designated by the Board to administer the Plan, which committee shall be constituted in such a manner as to permit
the Plan to comply with Rule 16b-3 with respect to a plan intended to qualify thereunder as a discretionary plan. Once appointed, such
Committee shall continue to serve in its designated capacity until otherwise directed by the Board. From time to time the Board may increase
the size of the Committee and appoint additional members thereof, remove members (with or without cause) and appoint new members in substitution
therefor, fill vacancies, however caused, and remove all members of the Committee and thereafter directly administer the Plan, all to
the extent permitted by Rule 16b-3 with respect to a plan intended to qualify thereunder as a discretionary plan.


 


(ii) Multiple
Administrative Bodies. If permitted by Rule 16b-3, the Plan may be administered by different bodies with respect to directors, non-director
officers and Employees who are neither directors nor officers.


 


(iii) Administration
With Respect to Other Employees. With respect to grants of Options to Employees who are neither directors nor officers of the Corporation,
the Plan shall be administered by (A) the Board or (B) a Committee designated by the Board, which committee shall be constituted in such
a manner as to satisfy the legal requirements relating to the administration of incentive stock option plans, if any, of the Nevada corporate
and securities laws and of the Code (the “Applicable Laws”). Once appointed, such Committee shall continue to serve in its
designated capacity until otherwise directed by the Board. From time to time the Board may increase the size of the Committee and appoint
additional members thereof, remove members (with or without cause) and appoint new members in substitution therefor, fill vacancies, however
caused, and remove all members of the Committee and thereafter directly administer the Plan, all to the extent permitted by the Applicable
Laws.


 


(b) Powers
of the Board. Subject to the provisions of the Plan, the Board (or the Committee) shall have the authority, in its discretion: (i)
to grant Incentive Stock Options, Nonstatutory Stock Options or Restricted Stock Awards; (ii) to determine, upon review of relevant information
the fair market value of the Common Stock in each class; (iii) to determine the exercise price per Share of Options to be granted, which
exercise price shall be determined in accordance with Section 7(b) of the Plan and the price of Restricted Shares; (iv) to determine the
regular, full-time Employees and non-employee directors or other consultants to whom, and the time or times at which, Options or Restricted
Stock Awards shall be granted and the number of Shares to be represented by each Option or Restricted Stock Award; (v) to interpret the
Plan; (vi) to prescribe, amend and rescind rules and regulations relating to the Plan; (vii) to determine the rules and provisions of
each Option or Restricted Stock Award granted (which need not be identical) and, with the consent of the holder thereof, modify or amend
each Option or Restricted Stock Award; (viii) to accelerate or defer (with the consent of the Option Holder) the exercise date of any
Option, consistent with the provisions of Section 7 of the Plan; (ix) to authorize any person to execute on behalf of the Corporation
any instrument required to effectuate the grant of an Option or Restricted Stock Award previously granted by the Board or Committee; and
(x) to make all other determinations deemed necessary or advisable for the administration of the Plan.


 






    2


     


    

 


(c)  Grant
of Restricted Stock Awards. The Board or Committee shall have the power to issue a restricted stock award to an Employee or non-employee
director or consultant representing shares of Common Stock (“Restricted Shares”) that are issued subject to such restrictions
on transfer and other incidents of ownership and such forfeiture conditions as the Board or Committee may determine (“Restricted
Stock Awards”). In connection with issuance of any Restricted Shares, the Board or Committee may (but shall not be obligated to)
require the payment of a specified purchase price (which price may be less than Fair Market Value). Grant of a Restricted Stock Award
shall result in a decrease in the number of Shares that thereafter may be available for purposes of the Plan by the number of Restricted
Shares included in the Restricted Stock Award.


 


(d) Effect
of Board’s Decision. All decisions, determinations and interpretations of the Board (or the Committee designated by the Board
to administer the Plan) shall be final and binding on all Optionees, Option Holders of any Options and holders of Restricted Stock Awards
under the Plan.


 


5. Participation in the Plan


 


(a) Participation
in the Plan shall be limited to those Employees who are designated for payroll purposes as full-time, permanent employees of the Corporation
and any Parent or Subsidiary and those persons who shall be designated by the Committee and approved by the Board of Directors as participants
in the Plan. The Plan shall not confer upon any Optionee any right with respect to continuation of Employment, nor shall it interfere
in any way with his or her right or the Corporation’s right to terminate his or her employment at any time, with or without cause.


 


(b) A
member of the Board of Directors or consultant who is not also an Employee shall be eligible to participate in the Plan but shall not
be eligible to receive Incentive Stock Options hereunder.


 


6. Stock Subject to the Plan


 


(a) Subject
to Section 9 of the Plan, there shall be reserved for the granting of Options pursuant to the Plan and for issuance and sale pursuant
to such Options or Restricted Stock Awards 350,000 shares of Common Stock, subject to adjustments as provided in Section 7(d) of
the Plan, plus an automatic annual increase to be added on February 1 of each year beginning in 2022 and ending in 2031, equal to
the lesser of (i) 200,000 shares of Common Equity or (ii) five percent (5%) of the total shares of Common Stock outstanding
on such date (including for this purpose any shares of Common Stock issuable upon conversion of any outstanding capital equity of the
Company) or (iii) such lesser number as determined by the Board.. To determine the number of Shares of either the voting or nonvoting
class of Common Stock that is available at any time for the granting of Options, there shall be deducted from the total number of reserved
shares of that class of Common Stock, the number of shares of that class of Common Stock in respect of which Options have been granted
pursuant to the Plan that are still outstanding or have been exercised. The Shares of Common Stock to be issued pursuant to the Plan shall
be made available from the authorized but unissued shares of Common Stock or reacquired Common Stock. If for any reason Shares of Common
Stock as to which an Option has been granted cease to be subject to purchase thereunder, then such Shares of Common Stock again shall
(unless the Plan shall have been terminated) be available for issuance pursuant to the exercise of Options pursuant to the Plan. Notwithstanding
any other provision of the Plan, Shares issued under the Plan and later repurchased by the Corporation shall not become available for
future grant or sale under the Plan.


 


(b) Proceeds
from the purchase of shares of Common Stock upon the exercise of Options granted pursuant to the Plan or from Restricted Stock Awards
shall be used for the general business purposes of the Corporation.


 


7. Terms and Conditions of
Options


 


(a) Options
granted hereunder may be either Incentive Stock Options or Nonstatutory Stock Options and may be for the purchase of either voting or
non-voting Common Stock, all as determined by the Board of Directors or Committee at its discretion and as designated in the terms of
the Option Agreement. However, notwithstanding such designations, to the extent that the aggregate fair market value of the Shares with
respect to which Options designated as Incentive Stock Options are exercisable for the first time by any Optionee during any calendar
year (under all plans of the Corporation) exceeds $100,000, such Options shall be treated as Nonstatutory Stock Options. For purposes
of the prior sentence, Options shall be taken into account in the order in which they were granted, and the fair market value of the Shares
shall be determined as of the time the Option with respect to such Shares is granted.


 


(b) The
per Share exercise price for the Shares to be issued pursuant to exercise of an Option shall be such price as is determined by the Board
of Directors or Committee at the time of the grant, but shall be subject to the following:


 


(i) In the
case of an Incentive Stock Option:


 


(A) which
is granted to an Employee who, at the time of the grant of such Incentive Stock Option, owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Corporation or any Parent or Subsidiary, the per Share exercise price shall be
no less than 110% of the Fair Market Value per Share on the date of grant.


 






    3


     


    

 


(B) which
is granted to any other Employee, the per Share exercise price shall be no less than 100% of the fair market value per Share on the date
of grant.


 


(ii) In
the case of Nonstatutory Stock Option


 


(A) which
is granted to a person who, at the time of the grant of such Option, owns stock representing more than ten percent (10%) of the voting
power of all classes of stock of the Corporation or any Parent or Subsidiary, the per Share exercise price shall be as determined by the
Board of Directors or Committee.


 


(B) granted
to any other person, the per Share exercise price shall be as determined by the Board of Directors or Committee.


 


For purposes of this Section 7(b), in the event that
an Option is amended to reduce the exercise price, the date of grant of such Option shall thereafter be considered to be the date of such
amendment.


 


If the Board of Directors or Committee does not establish
a specific exercise price per share at the time of grant, the exercise price per share shall be equal to the Fair Market Value of a share
of Common Stock on the date of grant of the Options.


 


(c) Each
Option, subject to the other limitations set forth in the Plan, may extend for a period of up to but not exceeding 10 years from the date
on which it is granted. The term of each Option shall be determined by the Board of Directors or Committee at the time of grant of the
Option and specified in the Option Agreement, provided that if no term is specified by the Board or Committee the term of the Option shall
be the maximum term permitted under this Section measured from the date on which it is granted. Notwithstanding anything to the contrary,
in the case of an Option granted to an Optionee who, at the time the Option is granted, owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Corporation or any Parent or Subsidiary, (a) if the Option is an Incentive Stock
Option, the term of the Option shall be five (5) years from the date of grant thereof or such shorter term as may be provided in the Incentive
Stock Option Agreement, or (b) if the Option is a Nonstatutory Stock Option, the term of the Option shall be five (5) years and one (1)
day from the date of grant thereof or such shorter term as may be provided in the Nonstatutory Stock Option Agreement.


 


(d) The
Board of Directors or Committee may provide in the Option Agreement that the right to exercise each Option for the number of shares subject
to each Option shall vest in the Optionee over such period of time as the Board or Committee, in its discretion, shall determine for each
Optionee.


 


(e) Options
shall be nontransferable and nonassignable and may not be sold, pledged, assigned, hypothecated, transferred, or disposed in any manner,
except that (1) Options may be transferred by testamentary instrument or by the laws of descent and distribution, and (2) subject to the
terms and conditions of the Option Agreement or any other terms and conditions imposed by the Board of Directors or Committee from time
to time, Options may be transferred in accordance with Section 7(l) of the Plan if the applicable Option Agreement or other action of
the Board or Committee expressly provides that the Options are transferable.


 


(f) Upon
voluntary or involuntary termination of an Optionee’s active Employment for any reason (including disability), his Option and all
rights thereunder shall terminate effective at the close of business on the date the Optionee ceases to be an active, regular employee
of the Corporation or any of its subsidiaries, except (1) to the extent previously exercised and (2) as provided in Sections 7 (g), (h),
(i) and (j) of the Plan.


 


(g) In
the event an Optionee takes a leave of absence from the Corporation or any Parent or Subsidiary for personal reasons or as a result of
entry into the armed forces of the United States, or any of the departments or agencies of the United States government, the Committee
may consider his or her case and may take such action in respect of the related Option Agreement as it may deem appropriate under the
circumstances in its absolute discretion, including accelerating the time previously-granted Options may be exercised and extending the
time following the Optionee’s termination of Employment during which the Option Holder is entitled to purchase the Shares of Common
Stock subject to such Options, provided that in no event may any Option be exercised after the expiration of the term of the Option or
more than ninety (90) days after the Optionee’s termination of Employment.


 


(h) If
an Optionee’s Employment terminates as a result of his or her total and permanent disability (as defined in Section 22(e)(3) of
the Code), the Option Holder may exercise his or her Option within no more than the twelve (12) month period beginning on the date of
his or her termination of Employment (to the extent the Option Holder was entitled to exercise the Option at the date of the Optionee’s
termination of Employment and provided that in no event may any Option be exercised after the expiration of the term of the Option), after
which the Option shall lapse.


 






    4


     


    

 


(i) If
an Optionee dies during the term of his or her Option without the Option having been fully exercised, the executor or administrator of
the Optionee’s estate or the person who inherits the right to exercise the Option by bequest or inheritance shall have the right
within one (1) year of the Optionee’s death to purchase the number of Shares of Common Stock that the deceased Optionee was entitled
to purchase at the date of death, after which the Option shall lapse, provided that in no event may any Option be exercised after the
expiration of the term of the Option.


 


(j) If
an Optionee terminates employment without having fully exercised the Option due to the Optionee’s retirement at or after age 60
and with the consent of the Corporation, then the Option Holder shall have the right within ninety (90) days of the Optionee’s termination
of Employment to purchase the number of shares of Common Stock that the Option Holder was entitled to purchase at the date of termination
of the Optionee’s Employment, after which the Option shall lapse, provided that in no event may any Option be exercised after the
expiration of the term of the Option. The Board of Directors or Committee may cancel an Option during the ninety day period referred to
in this paragraph, if the Optionee engages in employment or activities contrary, in the opinion of the Board or Committee, to the best
interests of the Corporation. The Board or Committee shall determine in each case whether a termination of Employment shall be considered
a retirement with the consent of the Corporation, and, subject to applicable law, whether a leave of absence shall constitute a termination
of Employment. Any such determination of the Board or Committee shall be final and conclusive, unless the Committee is overruled by the
Board.


 


(k) The
granting of an Option pursuant to the Plan shall not constitute or be evidence of any agreement or understanding, express or implied,
on the part of the Corporation or any of its subsidiaries to retain or employ the Optionee for any specified period.


 


(l) The
Board of Directors or Committee may provide, in the original grant of a Nonqualified Stock Option or in an amendment or supplement to
a previous grant, that some or all of the Nonqualified Stock Options granted under the Plan are transferable by the Optionee to an Immediate
Family Member of the Optionee, provided that (i) the Option Agreement, as it may be amended from time to time, expressly so provides or
the Board or Committee otherwise designates the Option as transferable, (ii) the transfer by the Optionee is a bona fide gift without
consideration, (iii) the transfer is irrevocable, (iv) the Optionee and any such transferee provides such documentation or other information
concerning the transfer or the transferee as the Board of Directors or Committee or any Employee of the Corporation acting on behalf of
the Board or Committee may from time to time request, and (v) the Optionee or the Option Holder complies with all of the terms and conditions
(including, without limitation, any further restrictions or limitations) included in the Option Agreement. Any Nonqualified Stock Option
transferred in accordance with the terms and conditions provided in this Section 7(l) shall continue to be subject to the same terms and
conditions that were applicable to such Nonqualified Stock Option prior to the transfer. Notwithstanding any other provisions of the Plan,
the Corporation shall not be required to honor any exercise by an Immediate Family Member of an Option transferred in accordance with
the terms and conditions provided in this Section 7(l) unless and until payment or provision for payment of any applicable withholding
taxes has been made.


 


(m) In
addition to the general terms and conditions set forth in this Section 7 in respect of Options granted pursuant to the Plan, Incentive
Stock Options granted pursuant to the Plan shall be subject to the following additional terms and conditions:


 


 (i) “Incentive Stock Options”
shall be granted only to individuals who, at the date of grant of the Option, are regular, full-time Employees of the Corporation or any
Parent or Subsidiary;


 


 (ii) No Employee who owns beneficially
more than 10% of the total combined voting power of all classes of stock of the Corporation shall be eligible to be granted an “Incentive
Stock Option”, unless the exercise price per Share is at least 110% of the Fair Market Value of the Common Stock subject to the
Option on the date of grant of the Option and the Option, by its terms, is not exercisable after the expiration of five years from the
date the Option is granted.


 


 (iii) To the extent that the aggregate
fair market value (determined at the time the Option is granted) of the shares of Common Stock in respect of which an Option is exercisable
for the first time by the Optionee during any calendar year (and taking into account all “incentive stock option” plans of
the Corporation and its subsidiaries) exceeds $100,000, that number of whole shares for which an Option issued hereunder is exercisable
with an aggregate fair market value in excess of this $100,000 limit shall not be treated as having been granted under an “incentive
stock option”; and


 


 (iv) Any other terms and conditions
specified by the Committee that are not inconsistent with the Plan, except that such terms and conditions must be consistent with the
requirements for “incentive stock options” under Section 422 of the Code.


 






    5


     


    

 


8. Methods of Exercise of
Options


 


(a) An
Optionee (or other Option Holder, if any, entitled to exercise an Option hereunder) desiring to exercise an Option granted pursuant to
the Plan as to all or part of the Shares of Common Stock covered by the Option shall (i) notify the Corporation in writing at its principal
office to that effect, specifying the number of Shares of Common Stock to be purchased and the method of payment therefor, and (ii) make
payment or provision for payment for the shares of Common Stock so purchased in accordance with this Section 8. Such written notice
may be given by means of a facsimile transmission. If a facsimile transmission is used, the Option Holder should mail the original executed
copy of the written notice to the Corporation promptly thereafter. An Option may not be exercised for as fraction of a share of Common
Stock.


 


(b) The
consideration to be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined
by the Board of Directors and may consist entirely of cash, check, promissory note, other shares of Common Stock which (i) either have
been owned by the Option Holder for more than six (6) months on the date of surrender or were not acquired, directly or indirectly, from
the Corporation, and (ii) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to
which said Option shall be exercised, or any combination of such methods of payment, or such other consideration and method of payment
for the issuance of Shares to the extent permitted under the laws of Nevada. In making its determination as to the type of consideration
to accept, the Board shall consider if acceptance of such consideration may be reasonably expected to benefit the Corporation.


 


(c) An
Option shall be deemed to be exercised when written notice of such exercise has been given to the Corporation in accordance with the terms
of the Option by the Option Holder and full payment for the Shares with respect to which the Option is exercised has been received by
the Corporation. Full payment may, as authorized by the Board of Directors, consist of any consideration and method of payment allowable
under Section 8(b) of the Plan. Until the issuance (as evidenced by the appropriate entry on the books of the Corporation or of a duly
authorized transfer agent of the Corporation) of the stock certificate evidencing such Shares, no right to vote (in the case of voting
stock) or receive dividends or any other rights as a shareholder shall exist with respect to the optioned Shares, notwithstanding the
exercise of the Option. The Corporation shall issue (or cause to be issued) such stock certificate promptly upon exercise of the Option.
In the event that the exercise of an Option is treated in part as the exercise of a Nonstatutory Stock Option, the Corporation shall issue
a separate stock certificate evidencing the Shares of each class treated as acquired upon exercise of an Incentive Stock Option and a
separate stock certificate evidencing the Shares of each class treated as acquired upon exercise of a Nonstatutory Stock Option, and shall
identify each such certificate accordingly in its stock transfer records. No adjustment will be made for a dividend or other right for
which the record date is prior to the date the stock certificate is issued, except as provided in Section 9 of the Plan.


 


(d) An
Option Holder at any time may elect in writing to abandon an Option in respect of all or part of the number of Shares of Common Stock
as to which the Option shall not have been exercised.


 


(e) Exercise
of an Option in any manner shall result in a decrease in the number of Shares that thereafter may be available, both for purposes of the
Plan and for sale under the Option, by the number of Shares as to which the Option is exercised.


 






    6


     


    

 


9. Adjustments Upon Changes
in Capitalization or Merger


 


Subject to any required action by the shareholders
of the Corporation, the number of Shares of Common Stock covered by each outstanding Option, and the number of Shares of Common Stock
which have been authorized for issuance under the Plan but as to which no Options have yet been granted or which have been returned to
the Plan upon cancellation or expiration of an Option, as well as the price per Share of Common Stock covered by each such outstanding
Option, shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from a
stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other increase or decrease
in the number of issued shares of Common Stock effected without receipt of consideration by the Corporation; provided, however, that conversion
of any convertible securities of the Corporation shall not be deemed to have been “effected without receipt of consideration.”
Such adjustment shall be made by the Board of Directors, whose determination in that respect shall be final, binding and conclusive. Except
as expressly provided herein, no issuance by the Corporation of shares of stock of any class, or securities convertible into shares of
stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Shares of
Common Stock subject to an Option.


 


In the event of the proposed dissolution, liquidation
or sale of all or substantially all of the assets of the Corporation, the Board shall notify the Optionee or other Option Holder at least
fifteen (15) days prior to such proposed action. To the extent it has not been previously exercised, the Option will terminate immediately
prior to the consummation of such proposed action. In the event of the merger of the Corporation with or into another corporation, the
Option shall be assumed or an equivalent option shall be substituted by such successor corporation or a parent or subsidiary of such successor
corporation, unless such successor corporation does not agree to assume the Option or to substitute an equivalent option, in which case
the Board shall, in lieu of such assumption or substitution, provide for the Option Holder to have the right to exercise the Option as
to all of the optioned Shares, including Shares as to which the Option would not otherwise be exercisable. If the Board makes an Option
fully exercisable in lieu of assumption or substitution in the event of a merger or sale of assets, the Board shall notify the Optionee
or other Option Holder that the Option shall be fully exercisable for a period of fifteen (15) days from the date of such notice, and
the Option will terminate upon the expiration of such period.


 


10. Time of Granting Options


 


The date of grant of an Option shall, for all purposes,
be the date on which the Board of Directors or Committee makes the determination granting such Option. Notice of the determination shall
be given to each Optionee within a reasonable time after the date of such grant.


 


11. Amendments and Discontinuance
of the Plan


 


(a) The
Board of Directors shall have the right at any time and from time to time to amend, modify, or discontinue the Plan in such respects as
the Board may deem advisable; provided that, unless approved by the Corporation’s shareholders in accordance with Section 15, no
such amendment, modification, or discontinuance of the Plan shall (i) revoke or alter the terms of any valid Option previously granted
pursuant to the Plan, (ii) increase the number of shares of Common Stock to be reserved for issuance and sale pursuant to Options granted
pursuant to the Plan, (iii) change the maximum aggregate number of shares of Common Stock that may be issued upon the exercise of Options
granted pursuant to the Plan to any single individual, (iv) decrease the price determined pursuant to the provisions of Section 7(b),
(v) change the class of persons to whom Options may be granted pursuant to the Plan, (vi) provide for Options exercisable more than 10
years after the date granted, (vii) if the Corporation has a class of equity securities registered under Section 12 of the Exchange Act
at the time of such revision or amendment, any material increase in the benefits accruing to participants under the Plan.


 


(b) Shareholder
Approval. If any amendment requiring shareholder approval under Section 15(a) of the Plan is made at a time when any class of equity
securities by the Corporation is registered under Section 12 of the Exchange Act, such shareholder approval shall be solicited as described
in Section 15 of the Plan.


 


(c) Effect
of Amendment or Termination. Any such amendment or termination of the Plan shall not affect Options already granted and such Options
shall remain in full force and effect as if this Plan had not been amended or terminated, unless mutually agreed otherwise between the
Optionee or other Option Holder and the Board of Directors, which agreement must be in writing and signed by the Option Holder and the
Corporation.


 






    7


     


    

 


12. Plan Subject to Governmental
Laws and Regulations


 


The Plan and the grant and exercise of Options
and grant of Restricted Stock Awards pursuant to the Plan shall be subject to all applicable governmental laws and regulations. Notwithstanding
any other provision of the Plan to the contrary, the Board of Directors may in its sole and absolute discretion make such changes in the
Plan as may be required to conform the Plan to such laws and regulations. Shares shall not be issued pursuant to the exercise of an Option
or Restricted Shares pursuant to a Restricted Stock Award unless the exercise of such Option and the issuance and delivery of such Shares
pursuant thereto or the issuance of the Restricted Shares pursuant to the Restricted Stock Award shall comply with all relevant provisions
of law, including, without limitation, the Securities Act of 1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the Shares may then be listed, and shall be further subject to the approval
of counsel for the Corporation with respect to such compliance.


 


As a condition to the exercise of an Option or
issuance of Restricted Shares pursuant to a Restricted Stock Award, the Corporation may require the person exercising such Option or receiving
such Restricted Shares to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment
and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Corporation, such a representation
is required by any of the aforementioned relevant provisions of law.


 


13. Reservation of Shares


 


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


 


The inability of the Corporation to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the Corporation’s counsel to be necessary to the lawful
issuance and sale of any Shares hereunder, shall relieve the Corporation of any liability in respect of the failure to issue or sell such
Shares as to which such requisite authority shall not have been obtained.


 


14. Option Agreements and
Restricted Stock Awards


 


Options and Restricted Stock Awards shall be evidenced
by written option or restricted stock award agreements in such form as the Committee shall determine from time to time.


 


15. Shareholder Approval


 


(a) Continuance
of the Plan shall be subject to approval by the shareholders of the Corporation within twelve (12) months before or after the date the
Plan is adopted.


 


(b) The
required approval of the shareholders of the Corporation shall be solicited substantially in accordance with Section 14 of the Exchange
Act and the rules and regulations promulgated thereunder.


 


16. Term of Plan


 


The Plan shall become effective upon the earlier
to occur of its adoption by the Board of Directors or its approval by the shareholders of the Corporation as described in Section 15 of
the Plan. It shall continue in effect for a term of ten (10) years unless sooner terminated under Section 11 of the Plan.


 


[The remainder of this page is intentionally blank.]


 


 


8