Exhibit 10.1


 


Simulations
Plus, Inc.


2021 EQUITY INCENTIVE PLAN



Plan Adopted by the Board: April 9, 2021

Plan Approved by the Shareholders: ________, 2021


 


Termination
Date: April 9, 2031


 


1.     
General.


 


(a)              
Purposes. The purposes of the Plan are as follows:


 


(i)               
To provide additional incentive for selected Employees, Directors and Consultants to further the growth, development and financial
success of the Company by providing a means by which such persons can personally benefit through the ownership of capital stock of the
Company; and


 


(ii)             
To enable the Company to secure and retain key Employees, Directors and Consultants considered important to the long-term success
of the Company by offering such persons an opportunity to own capital stock of the Company.


 


(b)             
Eligible Stock Award Recipients. The persons eligible to receive Stock Awards under the Plan are the Employees, Directors
and Consultants of the Company and its Affiliates.


 


(c)             
Available Stock Awards. The following Stock Awards are available under the Plan: (i) Incentive Stock Options; (ii)
Nonstatutory Stock Options; (iii) Restricted Stock awards, (iv) Restricted Stock Units; (v) Stock Bonus awards; and (vi) Performance-Based
Awards.


 


2.     
Definitions.


 


(a)             
“Administrator” means the entity that conducts the general administration of the Plan as provided herein.
The term “Administrator” shall refer to the Board unless the Board has delegated administration to a Committee as provided
in Article 3.


 


(b)             
“Affiliate” means:


 


(i)              
with respect to Incentive Stock Options, any “parent corporation” or “subsidiary corporation” of the Company,
whether now existing or hereafter created or acquired, as those terms are defined in Sections 424(e) and 424(f) of the Code, respectively;
and


 


(ii)             
with respect to Stock Awards other than Incentive Stock Options, any entity described in paragraph (a) of this Section 2(b), plus
any other corporation, limited liability company, partnership or joint venture, whether now existing or hereafter created or acquired,
with respect to which the Company beneficially owns more than fifty percent (50%) of: (1) the total combined voting power of all outstanding
voting securities or (2) the capital or profits interests of a limited liability company, partnership or joint venture.


 


(c)              
“Award Shares” means the shares of Common Stock of the Company issued or issuable pursuant to a Stock Award, including
Option Shares issued or issuable pursuant to an Option.


 


 


 


 






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(d)             
“Board” means the Board of Directors of the Company.


 


(e)              
“Cause” shall mean, unless the applicable Stock Award Agreement states otherwise: (a) the Company or an
Affiliate having “cause” to terminate a Participant’s employment or service, as defined in any employment or consulting
agreement or similar services agreement between the Participant and the Company or an Affiliate in effect at the time of such termination,
or (b) in the absence of any such employment, consulting or similar services agreement (or the absence of any definition of “Cause”
contained therein), “Cause” shall mean, as determined by the Administrator, the Participant’s (i) act(s) of fraud or
dishonesty, (ii) knowing and material failure to comply with applicable laws or regulations or satisfactorily perform Participant’s
services, (iii) insubordination, or (iv) drug or alcohol abuse.


 


(f)               
“Change in Control” shall mean:


 


(i)               
The direct or indirect sale or transfer, in a single transaction or a series of related transactions, by the shareholders of the
Company of voting securities, in which the holders of the outstanding voting securities of the Company immediately prior to such transaction
or series of transactions hold, as a result of holding Company securities prior to such transaction, in the aggregate, securities possessing
less than fifty percent (50%) of the total combined voting power all outstanding voting securities of the Company or of the acquiring
entity immediately after such transaction or series of related transactions;


 


(ii)             
A merger or consolidation in which the Company is not the surviving entity, except for a transaction in which the holders of the
outstanding voting securities of the Company immediately prior to such merger or consolidation hold as a result of holding Company securities
prior to such transaction, in the aggregate, securities possessing more than fifty percent (50%) of the total combined voting power of
all outstanding voting securities of the surviving entity (or the parent of the surviving entity) immediately after such merger or consolidation;


 


(iii)           
A reverse merger in which the Company is the surviving entity but in which the holders of the outstanding voting securities of
the Company immediately prior to such merger hold as a result of holding Company securities prior to such transaction, in the aggregate,
securities possessing less than fifty percent (50%) of the total combined voting power of all outstanding voting securities of the Company
or of the acquiring entity immediately after such merger;


 


(iv)           
The sale, transfer or other disposition (in one transaction or a series of related transactions) of all or substantially all of
the assets of the Company, except for a transaction in which the holders of the outstanding voting securities of the Company immediately
prior to such transaction(s) receive as a distribution with respect to securities of the Company, in the aggregate, securities possessing
more than fifty percent (50%) of the total combined voting power of all outstanding voting securities of the acquiring entity immediately
after such transaction(s); or


 


(v)             
Any time individuals who, on the date this Plan is adopted by the Board, are members of the Board (the “Incumbent Board”)
cease for any reason to constitute at least a majority of the members of the Board; provided, however, that if the appointment
or election (or nomination for election) of any new Board member was approved or recommended by a majority vote of the members of the
Incumbent Board then still in office, such new member shall, for purposes of this Plan, be considered as a member of the Incumbent Board.


 


(g)              
“Code” means the Internal Revenue Code of 1986, as amended.


 


(h)             
“Committee” means a committee appointed by the Board in accordance with Section 3(c).


 


(i)               
“Common Stock” means the shares of common stock of the Company.


 


 


 


 






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(j)               
“Company” means Simulations Plus, Inc., a California corporation.


 


(k)              
“Consultant” means any consultant or adviser if:


 


(a)               
The consultant or adviser renders bona fide services to the Company or any Affiliate;


 


(b)              
The services rendered by the consultant or adviser are not in connection with the offer or sale of securities in a capital-raising
transaction and do not directly or indirectly promote or maintain a market for the Company’s securities; and


 


(i)                
The consultant or adviser is a natural person who has contracted directly with the Company or any Affiliate to render such services.


 


(l)              
“Director” means a member of the Board.


 


(m)           
“Disability” means total and permanent disability as defined in Section 22(e)(3) of the Code and as interpreted
by the Administrator in each case.


 


(n)             
“Dividend Equivalents” shall have the meaning set forth in Section 7(c)(iii).


 


(o)              
“Effective Date” shall have the meaning given in Section 16 herein.


 


(p)             
“Employee” means any person, including officers and Directors, providing services as an employee to the
Company or any Affiliate. Neither service as a Director nor receipt of a director’s fee shall be sufficient to make a Director an
“Employee.”


 


(q)             
“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.


 


(r)              
“Fair Market Value” means, as of any date, the value of the Common Stock of the Company determined as follows:


 


(i)              
If the Common Stock is then listed or admitted to trading on a Nasdaq market system or a stock exchange which reports closing sale
prices, the Fair Market Value shall be the closing sale price on the date of valuation on such Nasdaq market system or principal stock
exchange on which the Common Stock is then listed or admitted to trading, or, if no closing sale price is quoted on such day, then the
Fair Market Value shall be the closing sale price of the Common Stock on such Nasdaq market system or such exchange on the next preceding
day for which a closing sale price is reported;


 


(ii)             
If the Common Stock is not then listed or admitted to trading on a Nasdaq market system or a stock exchange which reports closing
sale prices, the Fair Market Value shall be the average of the closing bid and asked prices of the Common Stock in the over-the-counter
market on the date of valuation; or


 


(iii)           
If neither (i) nor (ii) is applicable as of the date of valuation, then the Fair Market Value shall be determined by the Administrator
in good faith using any reasonable method of valuation, which determination shall be conclusive and binding on all interested parties.


 


(s)               
“Incentive Stock Option” means an Option intended to qualify as an incentive stock option within the meaning
of Section 422 of the Code and the regulations promulgated thereunder.


 


 


 


 






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(t)              
“Non-Employee Director” means a member of the Board who qualifies as a “Non-Employee Director”
as defined in Rule 16b-3(b)(3) of the Exchange Act, or any successor rule.


 


(u)             
“Nonstatutory Stock Option” means an Option not intended to qualify as an Incentive Stock Option.


 


(v)              
“Officer” means any person who is an officer of the Company within the meaning of Section 16 of the
Exchange Act and the rules and regulations promulgated thereunder.


 


(w)            
“Option” means a stock option granted pursuant to the Plan.


 


(x)              
“Option Agreement” means a written or electronic agreement between the Company and an Optionee evidencing
the terms and conditions of an individual Option grant. Each Option Agreement shall be subject to the terms and conditions of the Plan
and any rules and regulations adopted by the Administrator and incorporated therein.


 


(y)              
“Optionee” means the Participant to whom an Option is granted or, if applicable, such other person who holds
an outstanding Option.


 


(z)              
“Option Shares” means the shares of Common Stock of the Company issued or issuable pursuant to the exercise
of an Option.


 


(aa)           
“Participant” means an Optionee or any other person to whom a Stock Award is granted pursuant to the Plan
or, if applicable, such other person who holds an outstanding Stock Award.


 


(bb)           
“Performance-Based Award” means a Stock Award subject to the achievement of a Performance Goal or Performance
Goals, as set forth in the applicable Stock Award Agreement.


 


(cc)            
“Performance Criteria” means the criteria that the Administrator selects for purposes of establishing the
Performance Goal or Performance Goals for a Participant for a Performance Period. The Performance Criteria that will be used to establish
Performance Goals are limited to the following: net earnings (either before or after interest, taxes, depreciation and amortization),
sales or revenue, net income (either before or after taxes), operating earnings, cash flow (including, but not limited to, operating cash
flow and free cash flow), return on net assets, return on shareholders’ equity, return on sales, gross or net profit margin, working
capital, earnings per share and price per share of Common Stock, the achievement of certain milestones, customer retention rates, licensing,
partnership or other strategic transactions, obtaining a specified level of financing for the Company, as determined by the Administrator,
including the issuance of securities, or the achievement of one or more corporate, divisional or individual scientific or inventive measures.
Any of the criteria identified above may be measured either in absolute terms or as compared to any incremental increase or as compared
to results of a peer group. The Administrator shall define in an objective fashion the manner of calculating the Performance Criteria
it selects to use for such Performance Period for such Participant.


 


(dd)         
“Performance Goals” means, for a Performance Period, the goals established in writing by the Administrator
for the Performance Period based upon the Performance Criteria. Depending on the Performance Criteria used to establish such Performance
Goals, the Performance Goals may be expressed in terms of overall Company performance or the performance of an Affiliate, division or
other operational unit, or an individual. The Administrator, in its discretion, may adjust or modify the calculation of Performance Goals
for such Performance Period in order to prevent the dilution or enlargement of the rights of Participants (i) in the event of, or in anticipation
of, any unusual or extraordinary corporate item, transaction, event, or development, or (ii) in recognition of, or in anticipation of,
any other unusual or nonrecurring events affecting the Company, or the financial statements of the Company, or in response to, or in anticipation
of, changes in applicable laws, regulations, accounting principles, or business conditions.


 


(ee)           
“Performance Period” means the one or more periods of time, which may be of varying and overlapping durations,
as the Administrator may select, over which the attainment of one or more Performance Goals will be measured for the purpose of determining
a Participant’s right to, and the payment of, a Performance-Based Award.


 


 


 


 






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(ff)            
“Plan” means this 2021 Equity Incentive Plan.


 


(gg)          
“Restricted Stock” means Common Stock awarded to a Participant pursuant to Section 7(b) that is subject
to certain restrictions and may be subject to risk of forfeiture or repurchase.


 


(hh)         
“Restricted Stock Award Agreement” means a written or electronic agreement between the Company and a Participant
evidencing the terms and conditions of a Restricted Stock award. Each Restricted Stock Award Agreement shall be subject to the terms and
conditions of the Plan and any rules and regulations adopted by the Administrator and incorporated therein.


 


(ii)             
“Restricted Stock Unit” means a Stock Award that is valued by reference to a share of Common Stock, which
value may be paid to a Participant by delivery of such property as the Administrator shall determine, including, without limitation, cash
or shares of Common Stock, or any combination thereof, and that has such restrictions as the Administrator, in its sole discretion, may
impose, including, without limitation, any restriction on the right to retain such Stock Awards, and, subject to Section 7(c)(iii), to
receive any cash Dividend Equivalents with respect to such Stock Awards, which restrictions may lapse separately or in combination at
such time or times, in installments or otherwise, as the Administrator may deem appropriate.


 


(jj)            
“Securities Act” means the Securities Act of 1933, as amended.


 


(kk)          
“Stock Award” means any right granted under the Plan, including an Option, a right to acquire Restricted Stock,
a Restricted Stock Unit, a Stock Bonus, or a Performance-Based Award.


 


(ll)             
“Stock Award Agreement” means any written or electronic agreement, including an Option Agreement, Stock Bonus Agreement,
or Restricted Stock Award Agreement, between the Company and a holder of a Stock Award evidencing the terms and conditions of an individual
Stock Award grant. Each Stock Award Agreement shall be subject to the terms and conditions of the Plan and any additional rules and regulations
adopted by the Administrator and incorporated therein.


 


(mm)       
“Stock Bonus” means a payment in the form of shares of Common Stock, or as part of any bonus, deferred compensation
or other arrangement, made in lieu of all or any portion of the compensation, granted pursuant to Section 7(a).


 


(nn)          
“Stock Bonus Agreement” means a written or electronic agreement between the Company and a Participant evidencing
the terms and conditions of a Stock Bonus. Each Stock Bonus Agreement shall be subject to the terms and conditions of the Plan and any
rules and regulations adopted by the Administrator and incorporated therein.


 


(oo)          
“Ten Percent Shareholder” means a person who owns (or is deemed to own pursuant to Section 424(d) of the Code)
stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or of any of its
Affiliates.


 


(pp)         
“Termination of Service” means:


 


(i)                
With respect to Stock Awards granted to a Participant in his or her capacity as an Employee, the time when the employer-employee
relationship between the Participant and the Company (or an Affiliate) is terminated for any reason, including, without limitation a termination
by resignation, discharge, death or retirement;


 


 


 


 






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(ii)            
With respect to Stock Awards granted to a Participant in his or her capacity as a Director, the time when the Participant ceases
to be a Director for any reason, including without limitation a cessation by resignation, removal, failure to be reelected, death or retirement,
but excluding cessations where there is a simultaneous or continuing employment of the former Director by the Company (or an Affiliate)
and the Administrator expressly deems such cessation not to be a Termination of Service;


 


(iii)           
With respect to Stock Awards granted to a Participant in his or her capacity as a Consultant, the time when the contractual relationship
between the Participant and the Company (or an Affiliate) is terminated for any reason; and


 


(iv)            
With respect to Stock Awards granted to a Participant in his or her capacity as an Employee, Director or Consultant of an Affiliate,
when such entity ceases to qualify as an Affiliate under this Plan, unless earlier terminated as set forth above.


 


The Administrator, in its
sole and absolute discretion, shall determine the effect of all other matters and issues relating to a Termination of Service.


 


3.     
Administration.


 


(a)             
Administration by Board. The Plan shall be administered by the Administrator unless and until the Board delegates administration
to a Committee or an Officer, as provided in Section 3(c) below.


 


(b)             
Powers of the Administrator. The Administrator shall have the power, except as otherwise provided herein:


 


(i)               
To determine from time to time (A) which of the persons eligible under the Plan shall be granted Stock Awards; (B) when and how
the Stock Awards shall be granted; (C) what type or combination of types of Stock Awards will be granted; (D) the terms and conditions
of each Stock Award granted (which need not be identical), including, without limitation, the transferability or repurchase of such Stock
Awards or Award Shares issuable thereunder, as applicable, and the circumstances under which Stock Awards become exercisable or vested
or are forfeited or expire, which terms may but need not be conditioned upon the passage of time, continued employment, the satisfaction
of performance criteria, the occurrence of certain events, or other factors; and (E) the number of Award Shares subject to a Stock Award
that shall be granted to a Participant.


 


(ii)             
To construe and interpret the Plan and Stock Awards granted under it, and to make exceptions to any such provisions in good faith
and for the benefit of the Company, and to establish, amend and revoke rules and regulations for the Plan’s administration. The
Administrator, in the exercise of its power, may correct any defect, omission or inconsistency in the Plan or in any Stock Award Agreement
in a manner and to the extent it shall deem necessary or expedient to make the Plan fully effective.


 


(iii)           
To settle all controversies regarding the Plan and Stock Awards granted under it.


 


(iv)            
To accelerate the time at which a Stock Award may first be exercised or the time during which a Stock Award or any part thereof
will vest in accordance with the Plan (subject to Section 4(d) below), notwithstanding the provisions in the Stock Award stating the time
at which it may first be exercised or the time during which it will vest.


 


(v)             
To suspend or terminate the Plan at any time. Suspension or termination of the Plan shall not impair rights and obligations under
any Stock Award granted while the Plan is in effect except with the written consent of the affected Participant.


 


(vi)            
To submit any amendment to the Plan for shareholder approval.


 


 


 


 






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(vii)         
To amend the Plan in any respect the Administrator deems necessary or advisable to provide Participants with the maximum benefits
provided or to be provided under the provisions of the Code and the regulations promulgated thereunder relating to Incentive Stock Options
or to bring the Plan or Incentive Stock Options granted under it into compliance therewith.


 


(viii)        
To amend the terms of any one or more Stock Awards, including, but not limited to, amendments to provide terms more favorable than
previously provided in the Stock Award Agreement, subject to any specified limits in the Plan that are not subject to Administrator discretion;
provided, however, that the rights under any Stock Award shall not be impaired by any such amendment unless (a) the Company requests
the consent of the affected Participant, and (b) such Participant consents in writing. Notwithstanding the foregoing, subject to the limitations
of applicable law, if any, and without the affected Participant’s consent, the Administrator may amend the terms of any one or more
Stock Awards if necessary to maintain the qualified status of the Stock Award as an Incentive Stock Option or to bring the Stock Award
into compliance with Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder.


 


(ix)           
To amend the Plan as provided in Section 14.


 


(x)            
To prescribe and amend the terms of the agreements or other documents evidencing Stock Awards made under this Plan (which need
not be identical).


 


(xi)           
To place such restrictions on the sale or other disposition of Award Shares as may be deemed appropriate by the Administrator.


 


(xii)          
To determine whether, and the extent to which, adjustments are required pursuant to Section 11.


 


(xiii)        
Generally, to exercise such powers and to perform such acts as the Administrator deems necessary or expedient to promote the best
interests of the Company.


 


(c)              
Delegation to a Committee.


 


(i)               
General. The Board may delegate administration of the Plan to a committee of the Board composed of not fewer than
two (2) members (the “Committee”). If administration is delegated to a Committee, the Committee shall have, in connection
with the administration of the Plan, the powers theretofore possessed by the Board (and references in the Plan to the Administrator shall
thereafter be deemed to be references to the Committee), subject, however, to such resolutions, not inconsistent with the provisions of
the Plan, as may be adopted from time to time by the Board. The Board may abolish the Committee at any time and revest in the Board the
administration of the Plan. Appointment of Committee members shall be effective upon acceptance of appointment. In its sole discretion,
the Board may at any time and from time to time exercise any and all rights and duties of the Administrator under the Plan except with
respect to matters which under Rule 16b-3 under the Exchange Act are required to be determined in the sole discretion of the Committee.
Committee members may resign at any time by delivering written notice to the Board. Vacancies in the Committee may only be filled by the
Board.


 


(ii)             
Rule 16b-3 Compliance.  In the discretion of the Board, the Committee may consist solely of two or more Non-Employee
Directors, in accordance with Rule 16b-3 of the Exchange Act.  In addition, the Board or the Committee, in its discretion, may delegate
to a committee of one or more members of the Board who need not be Non-Employee Directors the authority to grant Stock Awards to eligible
persons who are not then subject to Section 16 of the Exchange Act.


 


(d)             
Effect of Change in Status. The Administrator shall have the absolute discretion to determine the effect upon
a Stock Award, and upon an individual’s status as an Employee, Consultant or Director under the Plan, including whether a Participant
shall be deemed to have experienced a Termination of Service or other change in status, and upon the vesting, expiration or forfeiture
of a Stock Award or Award Shares issuable in respect thereof, in the case of (i) a Termination of Service for cause, (ii) any leave of
absence approved by the Company or an Affiliate, (iii) any transfer between the Company and any Affiliate or between any Affiliates, (iii)
any change in the Participant’s status from an Employee to a Consultant or member of the Administrator of Directors, or vice versa,
and (v) any Employee who becomes employed by any partnership, joint venture, corporation or other entity not meeting the requirements
of an Affiliate.


 


 


 


 






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(e)              
Determinations of the Administrator. All decisions, determinations and interpretations by the Administrator regarding
this Plan shall be final and binding on all Participants or other persons claiming rights under the Plan or any Stock Award. The Administrator
shall consider such factors as it deems relevant to making such decisions, determinations and interpretations including, without limitation,
the recommendations or advice of any Director, Officer or Employee of the Company and such attorneys, consultants and accountants as it
may select. A Participant or other holder of a Stock Award may contest a decision or action by the Administrator with respect to such
person or Stock Award only on the grounds that such decision or action was arbitrary or capricious or was unlawful, and any review of
such decision or action shall be limited to determining whether the Administrator’s decision or action was arbitrary or capricious
or was unlawful.


 


(f)               
Arbitration. Any dispute or claim concerning any Stock Awards granted (or not granted) pursuant to the Plan or any disputes
or claims relating to or arising out of the Plan shall be fully, finally and exclusively resolved by binding and confidential arbitration
conducted pursuant to the rules of Judicial Arbitration and Mediation Services, Inc. (“JAMS”) in the County of San
Diego, California. In addition to any other relief, the arbitrator may award to the prevailing party recovery of its attorneys’
fees and costs. By accepting a Stock Award, Participants and the Company waive their respective rights to have any such disputes or claims
tried by a judge or jury.


 


4.     
Shares Subject to the Plan; Overall Limitations.


 


(a)              
Shares Subject to the Plan. Subject to the provisions of Section 10 relating to adjustments upon changes in stock, the
Award Shares that may be issued pursuant to Stock Awards shall not exceed in the aggregate one million three hundred thousand (1,300,000)
shares of the Company’s Common Stock. Of such amount, one million three hundred thousand (1,300,000) Award Shares may be issued
pursuant to Incentive Stock Options.


 


(b)             
Reversion of Award Shares to Plan. 


 


(i)              
Award Shares Available for Subsequent Issuance. Award Shares subject to Stock Awards, and Award Shares issued under
this Plan under any Stock Award, will again be available for grant and issuance in connection with subsequent Stock Awards under this
Plan to the extent such Award Shares: (a) are subject to issuance upon exercise of an Option or settlement of a Restricted Stock
Unit granted under this Plan but which cease to be subject to the Option or Restricted Stock Unit by expiration, termination, cancellation,
or forfeiture prior to the issuance of such Award Shares; or (b) are subject to Stock Awards granted under this Plan that are repurchased
by the Company at the original issue price.


 


(ii)             
Award Shares Not Available for Subsequent Issuance. Award Shares used to pay the exercise price of an Option, Award
Shares withheld to satisfy the tax withholding obligations related to a Stock Award, or Award Shares repurchased by the Company for any
reason other than Shares repurchased at their original issue price, in each case, will not become available for future grant or sale under
this Plan.


 


(c)              
Dividends and Dividend Equivalents. The maximum number of Award Shares that may be issued under the Plan in Section
4(a) above shall not be affected by the payment of dividends or Dividend Equivalents in cash or in shares of Common Stock in connection
with outstanding Stock Awards.


 


(d)             
Vesting and Acceleration Restriction. Awards shall not provide for any vesting prior to at least twelve (12) months
from the date of grant. In addition, the Administrator will not permit the discretionary acceleration of vesting of Awards. Notwithstanding
the foregoing, the Administrator may permit (i) acceleration of vesting of Awards in the event of the Participant’s death or Disability,
or in connection with a Change in Control as provided in Section 11(b) below, and (ii) the vesting of Stock Awards on any basis prior
to twelve (12) months from grant representing up to an aggregate of five percent (5%) of the Award Shares reserved and available for grant
under the Plan.


 


5.     
Eligibility.


 


(a)              
General. Incentive Stock Options may be granted only to Employees; all other Stock Awards may be granted only to Employees,
Directors and Consultants. In the event a Participant is both an Employee and a Director, or a Participant is both a Director and a Consultant,
the Stock Award Agreement shall specify the capacity in which the Participant is granted the Stock Award; provided, however, if
the Stock Award Agreement is silent as to such capacity, the Stock Award shall be deemed to be granted to the Participant as an Employee
or as a Consultant, as applicable.


 


 


 


 






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(b)             
Ten Percent Shareholders. A Ten Percent Shareholder shall not be granted an Incentive Stock Option unless the exercise
price of such Option is at least one hundred ten percent (110%) of the Fair Market Value of the Common Stock at the date of grant and
the Option is not exercisable after the expiration of five (5) years from the date of grant.


 


6.     
Option Agreement Provisions.


 


Each Option shall be granted
pursuant to a written Option Agreement, signed by an Officer of the Company and by the Optionee, which shall be in such form and shall
contain such terms and conditions as the Administrator shall deem appropriate. The provisions of separate Option Agreements need not be
identical, but each Option Agreement shall include (through incorporation of the provisions hereof by reference in the Option Agreement
or otherwise) the substance of each of the following provisions (except to the extent that any such provision indicates it is permissible
rather than mandatory):


 


(a)              
Term. No Incentive Stock Option shall be exercisable after the expiration of ten (10) years from the date of its
grant or such shorter period specified in the Option Agreement; provided, however, that an Incentive Stock Option granted to a
Ten Percent Shareholder shall be subject to the provisions of Section 5(b).


 


(b)             
Exercise Price of an Option. Subject to the provisions of Section 5(b) regarding Incentive Stock Options granted to
Ten Percent Shareholders, the exercise price of each Incentive Stock Option shall be not less than the Fair Market Value of the Common
Stock subject to the Option on the date the Option is granted. The Administrator shall determine the exercise price of each Nonstatutory
Stock Option. Notwithstanding the foregoing, an Incentive Stock Option may be granted with an exercise price lower than one hundred percent
(100%) of the Fair Market Value of the Common Stock subject to the Option if such Incentive Stock Option is granted pursuant to an assumption
of or substitution for another option in a manner consistent with the provisions of Section 424(a) of the Code.


 


(c)              
Consideration. The purchase price of Common Stock acquired pursuant to the exercise of an Option shall be paid, to the
extent permitted by applicable law and as determined by the Administrator in its sole discretion, by any combination of the methods of
payment set forth below. The Administrator shall have the authority to grant Options that do not permit all of the following methods of
payment (or otherwise restrict the ability to use certain methods) and to grant Options that require the consent of the Company to utilize
a particular method of payment. The methods of payment permitted by this Section 6(c) are:


 


(i)               
by cash or check;


 


(ii)             
pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Administrator that, prior to the issuance
of Common Stock, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable instructions to pay the
aggregate exercise price to the Company from the sales proceeds;


 


(iii)            
by delivery to the Company (either by actual delivery or attestation) of shares of Common Stock;


 


(iv)            
by a “cashless exercise” arrangement pursuant to which the Company will reduce the number of shares of Common Stock
issued upon exercise by the largest whole number of shares with a Fair Market Value that does not exceed the aggregate exercise price;
provided, however, that the Company shall accept a cash or other payment from the Participant to the extent of any remaining balance
of the aggregate exercise price not satisfied by such reduction in the number of whole shares to be issued; provided, further, however,
that shares of Common Stock will no longer be outstanding under an Option and will not be exercisable thereafter to the extent that
(A) shares are used to pay the exercise price pursuant to the “cashless exercise,” (B) shares are delivered to the Participant
as a result of such exercise, and (C) shares are withheld to satisfy tax withholding obligations; or


 


(v)              
in any other form of legal consideration that may be acceptable to the Administrator.


 


 


 


 






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(d)             
Transferability. The following restrictions on the transferability of Options shall apply:


 


(i)              
Restrictions on Transfer. An Option shall not be transferable except by will or by the laws of descent and distribution
and shall be exercisable during the lifetime of the Optionee only by the Optionee; provided, however, that the Administrator may, in its
sole discretion, permit transfer of the Option to a revocable trust. Notwithstanding the foregoing, however, an Incentive Stock Option
shall not be transferable other than by will or the laws of descent and distribution, and shall be exercisable only by the Optionee during
the Optionee’s lifetime, except as otherwise permitted by the Administrator and by Sections 421, 422 and 424 of the Code and the
regulations and other guidance thereunder.


 


(ii)             
Domestic Relations Orders. Notwithstanding the foregoing, an Option may be transferred pursuant to a domestic relations
order; provided, however, that if an Option is an Incentive Stock Option, such Option shall be deemed to be a Nonstatutory Stock
Option as a result of such transfer.


 


(iii)           
Beneficiary Designation. Notwithstanding the foregoing, the Optionee may, by delivering written notice to the Company,
in a form provided by or otherwise satisfactory to the Company, designate a third party who, in the event of the death of the Optionee,
shall thereafter be the beneficiary of an Option with the right to exercise the Option and receive the Common Stock or other consideration
resulting from an Option exercise. In the absence of such a designation, the executor or administrator of the Optionee’s estate
shall be entitled to exercise the Option and receive the Common Stock or other consideration resulting from an Option exercise.


 


(e)              
Vesting. Each Option shall vest and become exercisable in one or more installments, at such time or times and subject
to such conditions, including without limitation the achievement of specified Performance Goals or objectives established with respect
to one or more performance criteria, as shall be determined by the Administrator (provided that no Option shall vest for at least twelve
(12) months following the date of grant).


 


(f)               
Termination of Service. In the event of the Termination of Service of an Optionee for any reason (other than for “Cause,”
as defined in an Option Agreement, or upon the Optionee’s death or Disability), the Optionee may exercise his or her Option, but
only within such period of time as is set forth in the Option Agreement (and in no event later than the expiration of the term of such
Option as set forth in the Option Agreement). In the case of an Incentive Stock Option, such exercise period provided in the Option Agreement
shall not exceed three (3) months from the date of termination.


 


(g)              
Disability of Optionee. In the event of a Termination of Service of an Optionee as a result of the Optionee’s
Disability, the Optionee may exercise his or her Option within the period specified in the Option Agreement (in no event to exceed twelve
(12) months from the date of such termination in the case of an Incentive Stock Option), and only to the extent that the Optionee was
entitled to exercise the Option at the date of such termination (but in no event later than the expiration of the term of such Option
as set forth in the Option Agreement).


 


(h)             
Death of Optionee. In the event that (i) an Optionee’s Termination of Service occurs as a result of the Optionee’s
death, or (ii) an Optionee dies within the period (if any) specified in the Option Agreement after the Optionee’s Termination of
Service for a reason other than death, then, notwithstanding Section 6(f) above, the Option may be exercised (to the extent the Optionee
was entitled to exercise such Option as of the date of death) by the Optionee’s estate, by a person who acquired the right to exercise
the Option by bequest or inheritance or by a person designated to exercise the option upon the Optionee’s death, but only within
the period ending on the earlier of (i) the date that is twelve (12) months after the date of Termination of Service, or (ii) the expiration
of the term of such Option as set forth in the Option Agreement.


 


(i)               
Termination for Cause. In the event of the Termination of Service of an Optionee for Cause, except as otherwise determined
by the Administrator in the specific situation, all Options granted to such Optionee shall expire as set forth in the Option Agreement.


 


(j)              
Extension of Termination Date. An Optionee’s Option Agreement may provide that if the exercise of the Option following
an Optionee’s Termination of Service (other than for Cause or upon the Optionee’s death or Disability) would be prohibited
at any time solely because the issuance of shares of Common Stock would violate the registration requirements under the Securities Act,
then the Option shall terminate on the earlier of (i) the expiration of a period of three (3) months after the termination of the Optionee’s
Continuous Service during which the exercise of the Option would not be in violation of such registration requirements, or (ii) the expiration
of the term of the Option as set forth in the Option Agreement.


 


 


 


 






    	 	10	 



     


    

 


(k)             
Early Exercise. The Option may, but need not, include a provision whereby the Optionee may elect at any time prior to
a Termination of Service to exercise the Option as to any part or all of the Option Shares prior to the full vesting of the Option. Any
unvested Option Shares so purchased may be subject to an unvested share repurchase option in favor of the Company or to any other restriction
the Administrator determines to be appropriate.


 


7.                 
Provisions of Stock Awards Other Than Options.


 


(a)              
Stock Bonus Awards. Stock Bonus awards shall be made pursuant to Stock Bonus Agreements in such form and containing
such terms and conditions as the Administrator shall deem appropriate. The terms and conditions of Stock Bonus Agreements may change from
time to time, and the terms and conditions of separate Stock Bonus Agreements need not be identical, but each Stock Bonus Agreement shall
include (through incorporation of provisions hereof by reference in the agreement or otherwise) the substance of each of the following
provisions (except to the extent that any such provision indicates it is permissible rather than mandatory):


 


(i)               
Consideration. A Stock Bonus may be awarded in consideration for past services actually rendered to the Company or
an Affiliate for its benefit, provided that the Participant remains eligible to receive Stock Awards hereunder at the time of the award.


 


(ii)             
Vesting. Award Shares issued pursuant to a Stock Bonus Agreement may, but need not, be subject to a share repurchase
option in favor of the Company in accordance with a vesting schedule to be determined by the Administrator (which may include the satisfaction
of Performance Goals).


 


(iii)            
Termination of Service. In the event of a Termination of Service, the Company may reacquire any or all of the Award
Shares held by the Participant which have or have not vested as of the date of termination under the terms of the Stock Bonus Agreement.


 


(iv)            
Transferability. Unless otherwise determined by the Administrator, rights to acquire Award Shares under the Stock
Bonus Agreement shall not be transferable except by will or by the laws of descent and distribution, or, to the extent permitted by the
Administrator, to a revocable trust.


 


(b)             
Restricted Stock Awards. Each Restricted Stock award shall be made pursuant to a Restricted Stock Award Agreement in
such form and containing such terms and conditions as the Administrator shall deem appropriate. The terms and conditions of the Restricted
Stock Award Agreements may change from time to time, and the terms and conditions of separate Restricted Stock Award Agreements need not
be identical, but each Restricted Stock Award Agreement shall include (through incorporation of provisions hereof by reference in the
agreement or otherwise) the substance of each of the following provisions (except to the extent that any such provision indicates it is
permissible rather than mandatory):


 


(i)               
Purchase Price. The purchase price under each Restricted Stock Award Agreement shall be such amount as the Administrator
shall determine and designate in such Restricted Stock Award Agreement, including no consideration or such minimum consideration as may
be required by applicable law.


 


(ii)             
Consideration. The purchase price of Common Stock acquired pursuant to the Restricted Stock Award Agreement, if any,
shall be paid either: (a) in cash at the time of purchase; (b) at the discretion of the Administrator, according to a deferred payment
or other similar arrangement with the Participant; or (c) in any other form of legal consideration that may be acceptable to the Administrator
in its discretion.


 


(iii)            
Vesting. Award Shares acquired under the Restricted Stock Award Agreement may, but need not, be subject to a share
repurchase option in favor of the Company in accordance with a vesting schedule to be determined by the Administrator (which may include
the satisfaction of Performance Goals).


 


(iv)            
Termination of Service. In the event of a Participant’s Termination of Service, the Company may repurchase
or otherwise reacquire any or all of the Award Shares held by the Participant which have or have not vested as of the date of termination
under the terms of the Restricted Stock Award Agreement.


 


 


 


 






    	 	11	 



     


    

 


(v)             
Transferability. Unless otherwise determined by the Administrator, rights to acquire Award Shares under the Restricted
Stock Award Agreement shall not be transferable except by will, by the laws of descent and distribution, or, to the extent permitted by
the Administrator, to a revocable trust.


 


(c)              
Restricted Stock Units.


 


(i)               
Issuance of Restricted Stock Units. The Administrator is authorized to make Awards of Restricted Stock Units to any
Participant selected by the Administrator in such amounts and subject to such terms and conditions as determined by the Administrator.
At the time of grant, the Administrator shall specify the date or dates on which the Restricted Stock Units shall become fully vested
and nonforfeitable, and may specify such conditions to vesting as it deems appropriate. Alternatively, Restricted Stock Units may become
fully vested and nonforfeitable pursuant to the satisfaction of one or more Performance Goals as the Administrator determines to be appropriate
at the time of the grant of the Restricted Stock Units or thereafter, in each case on a specified date or dates or over any period or
periods determined by the Administrator. At the time of grant, the Administrator shall specify the maturity date applicable to each grant
of Restricted Stock Units which shall be no earlier than the vesting date or dates of the Award. All Restricted Stock Unit awards shall
be subject to such additional terms and conditions as determined by the Administrator and shall be evidenced by a written Stock Award
Agreement.


 


(ii)             
Settlement of Restricted Stock Units. On the maturity date, the Company shall transfer to the Participant one unrestricted,
fully transferable share of Common Stock or cash equal to the Fair Market Value of one share of Common Stock for each Restricted Stock
Unit that is vested and scheduled to be distributed on such date and not previously forfeited.


 


(iii)            
Dividend Equivalents. Unless otherwise provided in an Stock Award Agreement, each Restricted Stock Unit may include
the right to receive, on a deferred basis, amounts equivalent to cash, stock or other property dividends on shares of Common Stock (“Dividend
Equivalents”) as provided herein. Dividend Equivalents will accumulate and be withheld until the applicable Restricted Stock Units
upon which the Dividend Equivalents are awarded vest and any Dividend Equivalent payments that have accumulated and have been withheld
by the Committee and attributable to any particular Restricted Stock Unit shall be distributed to the Participant in cash or, at the sole
discretion of the Administrator, in Shares having a Fair Market Value equal to the amount of such Dividend Equivalent payments then due;
provided that, in the event that all or any portion of any Restricted Stock Unit is forfeited, the Dividend Equivalents attributable to
such forfeited Restricted Stock Unit shall also be forfeited. Upon the vesting and settlement of Restricted Stock Units that include Dividend
Equivalents, the Dividend Equivalents attributable to such Restricted Stock Units shall expire automatically.


 


(iv)            
Termination of Service. Except as otherwise set forth in the Stock Award Agreement or as otherwise determined by
the Administrator, vesting of Restricted Stock Units ceases on the date Participant experiences a Termination of Service.


 


8.                 
Covenants of the Company.


 


(a)              
Availability of Shares. During the terms of the Stock Awards, the Company shall keep available at all times the number
of shares of Common Stock required to satisfy such Stock Awards.


 


(b)             
Compliance with Laws and Regulations. This Plan, the grant and exercise of Stock Awards thereunder, and the obligation
of the Company to sell, issue or deliver Award Shares under such Stock Awards, shall be subject to all applicable federal, state and local
laws, rules and regulations and to such approvals by any governmental or regulatory agency as may be required. The Company shall not be
required to register in a Participant’s name or deliver any Award Shares prior to the completion of any registration or qualification
of such Shares under any federal, state or local law or any ruling or regulation of any government body which the Administrator shall
determine to be necessary or advisable. To the extent the Company is unable to or the Administrator deems it infeasible to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary or advisable for
the lawful issuance and sale of any Award Shares hereunder, the Company shall be relieved of any liability with respect to the failure
to issue or sell such Award Shares as to which such requisite authority shall not have been obtained. No Option shall be exercisable and
no Award Shares shall be issued and/or transferable under any other Stock Award unless a registration statement with respect to the Award
Shares underlying such Stock Award is effective and current or the Company has determined that such registration is unnecessary.


 


 


 


 






    	 	12	 



     


    

 


9.                 
Use of Proceeds.


 


Proceeds from the sale of
Award Shares shall constitute general funds of the Company and shall be used for general operating capital of the Company.


 


10.             
Adjustments Upon Change in Common Stock.


 


If any change is made in the
Common Stock subject to the Plan or subject to any Stock Award without the receipt of consideration by the Company (through merger, consolidation,
reorganization, recapitalization, reclassification, stock dividend, dividend in property other than cash, stock split, reverse stock split,
liquidating dividend, exchange of shares, change in corporate structure or other distribution of the Company’s equity securities),
the Plan and all outstanding Stock Awards will be appropriately adjusted in the class and maximum number of shares subject to the Plan
and the class and number of shares and price per share of Common Stock subject to outstanding Stock Awards. Any adjustment in Incentive
Stock Options under this Section 10 shall be made only to the extent not constituting a “modification” within the meaning
of Section 424(h)(3) of the Code, and any otherwise applicable adjustments under this Section 10 shall be made in a manner that does not
adversely affect the exemption provided pursuant to Rule 16b-3 under the Exchange Act or the exemption under Section 409A of the Code,
to the extent applicable. The Company shall give each Participant notice of an adjustment hereunder and, upon notice, such adjustment
shall be conclusive and binding for all purposes.


 


11.             
Adjustments Upon Change in Control.


 


(a)              
Continuation of Awards; Assumption or Replacement of Awards by Successor; Payment for Awards. In the event of a Change
in Control of the Company, outstanding Stock Awards under this Plan shall be subject to the documentation evidencing the Change in Control
transaction, which need not treat all outstanding Stock Awards in an identical manner. Such agreement, without the Participant’s
consent, shall provide for one or more of the following with respect to all outstanding Stock Awards as of the effective date of such
Change in Control transaction:


 


(i)               
The continuation of outstanding Stock Awards by the Company (if the Company is the successor entity).


 


(ii)             
The assumption of outstanding Stock Awards by the successor or acquiring entity in such Change in Control transaction (or by its
parent, if any), which assumption will be binding on all selected Participants; provided that the exercise price and the number and nature
of shares issuable upon exercise of any such Option or any Stock Award that is subject to Section 409A of the Code, will be adjusted appropriately
pursuant to Section 424(a) of the Code.


 


(iii)            
The substitution by the successor or acquiring entity in such Change in Control transaction (or by its parent entity, if any) of
equivalent awards with substantially the same terms for selected Stock Awards (except that the exercise price and the number and nature
of shares issuable upon exercise of any such Option or any Stock Award that is subject to Section 409A of the Code, will be adjusted appropriately
pursuant to Section 424(a) of the Code).


 


(iv)            
A payment to the Participant equal to the excess of (i) the Fair Market Value of the Award Shares subject to the Stock Award
as of the effective date of such Change in Control transaction over (ii) the exercise price or purchase price of Award Shares, as
the case may be, subject to the Stock Award, in connection with the cancellation of the Stock Award. Such payment will be made in the
form of cash, cash equivalents, or securities of the surviving corporation or its parent with a Fair Market Value equal to the required
amount. Subject to Section 409A of the Code, such payment may be made in installments, may be deferred until the date or dates when the
Stock Award would have become exercisable or such Award Shares would have vested, and may be subject to continued vesting based on the
Participant’s continuing to provide services following such Change in Control transaction. In addition, any escrow, holdback, earnout
or similar provisions in the agreement for such Change in Control transaction may apply to such payment to the same extent and in the
same manner as such provisions apply to the holders of Common Stock. If the exercise price of an Option exceeds the Fair Market Value
of the Option Shares, then the Option may be cancelled without making a payment to the Participant. For purposes of this subsection, the
Fair Market Value of any security will be determined without regard to any vesting conditions that may apply to such security.


 


 


 


 






    	 	13	 



     


    

 


Outstanding Stock Awards need
not be treated similarly in a Change in Control transaction.


 


(b)             
Acceleration of Vesting. Notwithstanding Section 11(a) above:


 


(i)              
Stock Awards Not Assumed, Converted, Replaced. Solely in a Change in Control transaction in which the successor or
acquiring corporation refuses to assume, convert, replace, substitute, or make payment against cancellation of outstanding Stock Awards,
as provided above, then notwithstanding any other provision in this Plan to the contrary, and unless otherwise determined by the Administrator,
all Stock Awards granted under this Plan shall accelerate in full as of the time of consummation of the Change in Control transaction.
In such event, the Administrator will notify Participants in writing or electronically that such Stock Awards will be exercisable for
a period of time determined by the Stock Award in its sole discretion, and such Stock Award will terminate upon the expiration of such
period.


 


(ii)             
Termination of Employment Following Change in Control. In the event of a Change in Control of the Company in which
the successor company assumes, converts, replaces, or substitutes a Stock Award pursuant to Section 11(a)(i) - (iii) above (or in which
the Company is the successor entity and continues the Stock Award), if a Participant’s employment with such successor company (or
a subsidiary thereof) terminates (except as provided in the Stock Award Agreement, other than a termination by the Company for Cause)
within twelve (12) months following such Change in Control (or such other period set forth in the Stock Award Agreement, including prior
thereto if applicable): (i) Options outstanding as of the date of such termination of employment will immediately vest, become fully exercisable,
and may thereafter be exercised, (ii) restrictions, limitations and other conditions on Restricted Stock and Restricted Stock Units shall
lapse and the Restricted Stock and Restricted Stock Units shall become free of all restrictions, limitations and conditions and become
fully vested, (iii) all Performance-Based Awards shall be considered to be earned and payable (pro rata based on the portion of the Performance
Period completed as of the date of the termination), and any other restrictions shall lapse and such Performance-Based Awards shall be
immediately settled or distributed, and (iv) the restrictions, limitations and other conditions applicable to any other Stock Awards shall
lapse, and such other Stock Awards shall become free of all restrictions, limitations and conditions and become fully vested and transferable
to the full extent of the original grant.


 


(c)              
Notice to Participants. The Administrator shall give written notice of any proposed Change in Control transaction referred
to in this Section 11 at a reasonable period of time prior to the closing date for such transaction (which notice may be given either
before or after the approval of such transaction), in order that Participants may have a reasonable period of time prior to the closing
date of such transaction within which to exercise any Stock Awards that are then exercisable (including any Stock Awards that may become
exercisable upon the closing date of such Change in Control transaction). A Participant may condition his or her exercise of any Stock
Awards upon the consummation of the Change in Control transaction.


 


12.             
Dissolution or Liquidation.


 


In the event of a dissolution
or liquidation of the Company, then all outstanding Stock Awards shall terminate immediately prior to such event.


 


13.             
Miscellaneous.


 


(a)              
Foreign Award Recipients. Notwithstanding any provision of this Plan to the contrary, in order to comply with the laws
and practices in countries other than the United States in which the Company and its Affiliates operate or have employees or other individuals
eligible for Stock Awards, the Administrator, in its sole discretion, shall have the power and authority to: (i) determine which Affiliates
shall be covered by this Plan; (ii) determine which individuals outside the United States are eligible to participate in this Plan, which
may include individuals who provide services to the Company or Affiliate under an agreement with a foreign nation or agency; (iii) modify
the terms and conditions of any Stock Award granted to individuals who are located outside the United States or who are foreign nationals
to comply with applicable foreign laws, policies, customs and practices; (iv) establish subplans and modify exercise procedures and other
terms and procedures, to the extent determined necessary or advisable by the Administrator and provided that (a) no such subplans and/or
modifications shall increase the share limitations contained in Section 4(a) hereof and (b) in such instance, such subplans and/or modifications
shall be attached to this Plan as appendices; and (v) take any action, before or after a Stock Award is made, that the Administrator determines
to be necessary or advisable to obtain approval or comply with any local governmental regulatory exemptions or approvals. Notwithstanding
the foregoing, the Administrator may not take any actions hereunder, and no Award shall be granted, that would violate the Exchange Act
or any other applicable United States securities law, the Code or any other applicable United States governing statute or law.


 


 


 






    	 	14	 



     


    

 


(b)              
Shareholder Rights. Neither a Participant nor any person to whom a Stock Award is transferred shall be deemed to be
the holder of, or to have any of the rights of a holder with respect to, any Award Shares unless and until such person has satisfied all
requirements for exercise of the Stock Award pursuant to its terms and the Company has duly issued a stock certificate for such Award
Shares. After Award Shares are issued to the Participant, the Participant will be a shareholder and have all the rights of a shareholder
with respect to such Award Shares, including the right to vote and receive all dividends or other distributions made or paid with respect
to such Award Shares. Notwithstanding the foregoing, if such Award Shares are Restricted Stock, then any new, additional or different
securities the Participant may become entitled to receive with respect to such Award Shares by virtue of a stock dividend, stock split
or any other change in the corporate or capital structure of the Company will be subject to the same restrictions as the Restricted Stock;
provided, further, that the Participant will have no right to such stock dividends or stock distributions with respect to unvested shares
of Restricted Stock, and any such dividends or stock distributions shall be accrued and paid only at such time if any, as such unvested
shares of Restricted Stock become vested. The Administrator, in its discretion, may provide in the Stock Award Agreement evidencing any
Stock Award that the Participant shall be entitled to Dividend Equivalents with respect to the payment of cash dividends on Award Shares
subject to such Stock Award during the period beginning on the date the Stock Award is granted and ending, with respect to each Award
Share subject to the Stock Award, on the earlier of the date on which the Stock Award is exercised or settled or the date on which the
Award Shares are forfeited; provided, that under no circumstances may Dividend Equivalents be granted for any Option and provided, further,
that no Dividend Equivalents shall be paid with respect to unvested Award Shares, and any such dividends or stock distributions shall
be accrued and paid only at such time, if any, as such unvested Award Shares become vested. Such Dividend Equivalents, if any, shall be
credited to the Participant and distributed to the Participant in cash or, at the sole discretion of the Committee, in shares of Common
Stock having a Fair Market Value equal to the amount of such Dividend Equivalents then due.


 


(c)              
No Employment or Other Service Rights. Nothing in the Plan or any Stock Award Agreement shall confer upon any Participant
any right to continue to serve the Company or an Affiliate in the capacity in effect at the time the Stock Award was granted or shall
affect the right of the Company or an Affiliate to terminate (i) the employment of an Employee with or without notice and with or without
Cause; (ii) the service of a Consultant pursuant to the terms of such Consultant’s agreement with the Company or an Affiliate; or
(iii) the service of a Director pursuant to the Bylaws or Articles of Incorporation of the Company or an Affiliate, and any applicable
provisions of the corporate law of the state in which the Company or the Affiliate is incorporated, as the case may be.


 


(d)             
Unfunded Status of the Plan. The Plan is intended to constitute an “unfunded” plan for incentive compensation.
With respect to any payments not yet made to a Participant by the Company, nothing contained herein shall give any such Participant any
rights that are greater than those of a general unsecured creditor of the Company.


 


(e)              
Clawback / Recovery. All Stock Awards held by an executive officer shall be subject to clawback, recoupment or forfeiture
(i) to the extent that such executive officer is determined to have engaged in fraud or intentional illegal conduct materially contributing
to a financial restatement, as determined by the Board in its sole discretion, (ii) as provided under any clawback, recoupment or
forfeiture policy adopted by the Board, or (iii) required by law. Such clawback, recoupment or forfeiture policy, in addition to
any other remedies available under applicable law, may require the cancellation of outstanding Stock Awards and the recoupment of any
gains realized with respect to Stock Awards.


 


(f)               
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 Optionee during any
calendar year (under all plans of the Company and any Affiliates) exceeds One Hundred Thousand Dollars ($100,000), the Options or portions
thereof that exceed such limit (according to the order in which they were granted) shall be treated as Nonstatutory Stock Options, notwithstanding
any contrary provision of the applicable Option Agreement(s).


 


 


 


 






    	 	15	 



     


    

 


(g)              
Withholding Obligations. The Company may, in its sole discretion, satisfy any federal, state or local tax withholding
obligation relating to a Stock Award by any of the following means (in addition to the Company’s right to withhold from any compensation
paid to the Participant by the Company) or by a combination of such means: (i) causing the Participant to tender a cash payment; (ii)  withholding
shares of Common Stock from the shares of Common Stock issued or otherwise issuable to the Participant in connection with the Stock Award,
provided that no shares of Common Stock are withheld with a value exceeding the minimum amount of tax required to be withheld by law (or
such lower amount as may be necessary to avoid classification of the Stock Award as a liability); or (iii) by such other method as may
be set forth in the Stock Award Agreement.


 


(h)             
Compliance with Section 409A of the Code. To the extent applicable, the Plan and Stock Award Agreements shall be interpreted
in accordance with Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder,
including without limitation any such regulations or other guidance that may be issued or amended after the Effective Date (as defined
in Section 18 below). Notwithstanding any provision of the Plan or Stock Award to the contrary, in the event that following the Effective
Date the Administrator determines that any Stock Award may be subject to Section 409A of the Code and related Department of Treasury guidance
(including such Department of Treasury guidance as may be issued after the Effective Date), the Administrator may adopt such amendments
to the Plan and the applicable Stock Award Agreement or adopt other policies and procedures (including amendments, policies and procedures
with retroactive effect), or take any other actions, that the Administrator determines are necessary or appropriate to (i) exempt the
Stock Award from Section 409A of the Code and/or preserve the intended tax treatment of the benefits provided with respect to the Stock
Award; or (ii) comply with the requirements of Section 409A of the Code and Department of Treasury regulations and other interpretive
guidance issued thereunder, including without limitation any such regulations or other guidance that may be issued or amended after the
Effective Date.


 


(i)                
Documentation and Communications. The Stock Award Agreement for a given Stock Award, this Plan, and related communications
and any other documents may be delivered to, and accepted by, a Participant or any other person in any manner (including electronic distribution
or posting) that meets applicable legal requirements.


 


14.             
Amendment of the Plan.


 


(a)              
In General. The Administrator at any time, and from time to time, may amend the Plan. However, no amendment shall be
effective unless approved by the shareholders of the Company within twelve (12) months before or after the adoption of the amendment where
the amendment will:


 


(i)               
Increase the number of shares reserved for Stock Awards under the Plan, except as provided in Section 11 relating to adjustments
upon changes in Common Stock;


 


(ii)             
Modify the requirements as to eligibility for participation in the Plan (to the extent such modification requires shareholder approval
in order for the Plan to satisfy the requirements of Section 422 of the Code); or


 


(iii)            
Modify the Plan in any other way if such modification requires shareholder approval in order for the Plan to satisfy the requirements
of Section 422 of the Code.


 


(b)             
No Repricing. The Administrator may not (except pursuant to Section 10 or in connection with a Change in Control), when
the exercise price or grant price per Award Share exceeds the Fair Market Value of a share of Common Stock, without the approval of the
Company’s shareholders, cancel an Option or Stock Award in exchange for cash or take any other action with respect to an Option
or Stock Award that would be treated as a repricing under the rules and regulations of the principal securities market on which the Award
Shares are traded, including a reduction of the exercise price of an Option or the exchange of an Option for another Stock Award.


 


(c)              
Amendment to Maximize Benefits. It is expressly contemplated that the Administrator may amend the Plan in any respect
the Administrator deems necessary or advisable to provide Participants with the maximum benefits provided or to be provided under the
provisions of the Code and the regulations promulgated thereunder relating to Incentive Stock Options and/or to bring the Plan and/or
Incentive Stock Options granted under the Plan into compliance therewith.


 


 


 


 






    	 	16	 



     


    

 


(d)             
No Impairment. The rights and obligations under any Stock Award granted before any amendment of the Plan shall not be
altered or impaired by such amendment unless the Company requests the consent of the person to whom the Stock Award was granted and such
person consents in writing; provided, however, that notwithstanding anything to the contrary in this Section 16 or elsewhere
in this Plan, no such consent shall be required with respect to any amendment or alteration if the Administrator determines in its sole
discretion that such amendment or alteration either (i) is required or advisable in order for the Company, the Plan or the Stock Award
to satisfy or conform to any law or regulation or to meet the requirements of any accounting standard, or (ii) is not reasonably likely
to significantly diminish the benefits provided under such Award, or that any such diminishment has been adequately compensated.


 


15.             
Termination or Suspension of the Plan.


 


(a)              
Termination or Suspension. The Board may suspend or terminate the Plan at any time. Unless sooner terminated, the Plan
shall terminate on April 8, 2031 (which shall be within ten (10) years from the date the Plan is adopted by the Board or approved
by the shareholders of the Company, whichever is earlier), and no Stock Awards may be granted under the Plan while the Plan is suspended
or after it is terminated, but Stock Awards and Stock Award Agreements then outstanding shall continue in effect in accordance with their
respective terms.


 


(b)             
No Impairment. Rights and obligations under any Stock Award granted while the Plan is in effect shall not be altered
or impaired by suspension or termination of the Plan, except as otherwise provided herein or with the consent of the person to whom the
Stock Award was granted.


 


16.             
Effective Date of Plan.


 


The Plan became effective
on April 9, 2021, which is the date that the Plan was originally adopted by the Board (the “Effective Date”).


 


17.             
Non-Exclusivity of the Plan


 


Neither the adoption of this
Plan by the Board nor the submission of this Plan to the shareholders of the Company for approval shall be construed as creating any limitations
on the power of the Board to adopt such other incentive arrangements as either may deem desirable, including, without limitation, the
granting of stock options or restricted stock otherwise than under this Plan, and such arrangements may be either generally applicable
or applicable only in specific cases.


 


18.             
Liability of the Company.


 


The Company and the members
of the Board shall not be liable to a Participant or any other persons as to: (a) the non-issuance or non-transfer, or any delay of issuance
or transfer, of any Award Shares which results from the inability of the Company to comply with, or to obtain, or from any delay in obtaining
from any regulatory body having jurisdiction, all requisite authority to issue or transfer Award Shares if counsel for the Company deems
such authority reasonably necessary for lawful issuance or transfer of any such shares and, in furtherance thereof, appropriate legends
may be placed on the stock certificates evidencing Award Shares to reflect such transfer restrictions; and (b) any tax consequence expected,
but not realized, by any Participant or other person due to the receipt, exercise or settlement of any Option or other Stock Award granted
hereunder.


 


19.             
Choice of Law.


 


The laws of the State of California
shall govern all questions concerning the construction, validity and interpretation of this Plan, without regard to such state’s
conflict of laws rules.


 


  


 


 



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2021 EQUITY INCENTIVE PLAN


 


OF


 


 


Simulations
Plus, Inc.


 


 


 


 


 


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	1.   General.	1
	2.   Definitions.	1
	3.   Administration.	7
	4.   Shares Subject to the Plan; Overall Limitations.	9
	5.   Eligibility.	10
	6.   Option Agreement Provisions.	10
	7.   Provisions of Stock Awards Other Than Options.	13
	8.   Covenants of the Company.	16
	9.   Use of Proceeds.	16
	10.   Adjustments Upon Change in Common Stock.	16
	11.   Adjustments Upon Change in Control.	16
	12.   Dissolution or Liquidation.	17
	13.   Miscellaneous.	17
	14.   Amendment of the Plan.	20
	15.   Termination or Suspension of the Plan.	21
	16.   Effective Date of Plan.	21
	17.   Non-Exclusivity of the Plan	21
	18.   Liability of the Company.	21
	19.   Choice of Law.	21


 


 


 






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