Exhibit 10.1







 


 


 





PROUROCARE MEDICAL INC.


 


2012 STOCK PLAN


 


 


 


1.Purpose.


 


The purpose of the 2012 Stock Plan (the “Plan”)
of ProUroCare Medical Inc. (the “Company”), a Nevada corporation, is to increase shareholder value and to advance the
interests of the Company by furnishing a variety of economic incentives (variously referred to hereinafter as the “Incentives”)
designed to attract, retain and motivate employees, directors and consultants. Incentives may consist of opportunities to purchase
or receive shares of the Company’s $0.00001 par value common stock, (the “Common Stock”), monetary payments,
or both, on terms and conditions determined under this Plan.


 


2.Administration.


 


		2.1	Committee. The Plan shall be administered by a committee of the Company’s board of directors
(the “Committee”). The Committee shall consist of not less than two directors of the Company who shall be appointed
from time to time by the Company’s board of directors. Each member of the Committee shall qualify both as a “non-employee
director” within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934, as amended (together with the rules and
regulations promulgated thereunder, the “Exchange Act”), and as an “outside director” as defined in Section
162(m) of the Internal Revenue Code of 1986, as amended (the “Code”). The Committee shall have complete discretion
and authority to determine all provisions of all Incentives awarded under the Plan (consistent with the terms of the Plan), interpret
the Plan, and make any other determination which it believes necessary and advisable for the proper administration of the Plan.
The Committee’s decisions and matters relating to the Plan shall be final and conclusive for the Company and its participants.
No member of the Committee will be liable for any action or determination made in good faith with respect to the Plan or any Incentives
granted under the Plan. The Committee will also have the authority under the Plan to amend or modify the terms of any outstanding
Incentives in any manner; provided, however, that any such amended or modified terms are permitted by the Plan as then in
effect, and any recipient of an Incentive adversely affected by such amended or modified terms has consented to such amendment
or modification. No amendment or modification to an Incentive, however, whether pursuant to this Section 2 or any other provisions
of the Plan, will be deemed to be a re-grant of such Incentive for purposes of this Plan. If at any time there is no Committee,
then for purposes of the Plan the term “Committee” shall mean the Company’s board of directors.



 


		2.2	Changes Due to Certain Events. In the event of (i) any reorganization, merger, consolidation,
recapitalization, liquidation, reclassification, stock dividend, stock split, combination of shares, rights offering, extraordinary
dividend or divestiture, including a spinoff, or any other similar change in corporate structure or shares, (ii) any purchase,
acquisition, sale or disposition of a significant amount of assets or a significant business, (iii) any change in accounting principles
or practices, or (iv) any other similar change, in each case with respect to the Company or any other entity whose performance
is relevant to the grant or vesting of an Incentive, the Committee (or, if the Company is not the surviving corporation in any
such transaction, the board of directors of the surviving corporation) may, without the consent of any affected recipient of an
Incentive, amend or modify the vesting criteria of any outstanding Incentive based, in whole or in part, on the financial performance
of the Company (or any subsidiary or division thereof) or such other entity so as equitably to reflect such event, with the desired
result that the criteria for evaluating such financial performance of the Company or such other entity will be substantially the
same (in the sole discretion of the Committee or the board of directors of the surviving corporation) following such event as prior
to such event; provided, however, that the amended or modified terms are permitted by the Plan as then in effect.



 



    	1



    	Exhibit 10.1



    



3.Eligible
Participants.


 


Employees of the Company or its subsidiaries,
including officers and employees of the Company or its subsidiaries), directors and consultants, advisors or other independent
contractors who provide services to the Company or its subsidiaries, including members of any advisory board, shall become eligible
to receive Incentives under the Plan when designated by the Committee. Participants may be designated individually or by groups
or categories (for example, by pay grade) as the Committee deems appropriate. Participation by Company officers or its subsidiaries
and any performance objectives relating to such officers must be approved by the Committee. Participation by others and any performance
objectives relating to others may be approved by groups or categories (for example, by pay grade) and authority to designate
participants who are not officers and to set or modify such performance objectives may be delegated.


 


4.Types
of Incentives.


 


Incentives under the Plan may be granted in
any combination of the following forms: (a) incentive stock options and non-statutory stock options under Section 6; (b) stock-appreciation
rights (“SARs”) under Section 7; (c) stock awards under Section 8; (d) restricted stock under Section 8; and (e) performance
shares under Section 9.


 


5.Shares
Subject to the Plan.


 


		5.1	Number of Shares. Subject to adjustment as provided in Section 11.6, the number of shares
                                                             of Common Stock which may be issued under the Plan shall not exceed 500,000 shares of Common Stock. Shares of Common Stock
                                                             issued under the Plan or that are currently subject to outstanding Incentives will be applied to reduce the maximum number of
                                                             shares of Common Stock remaining available for issuance under the Plan.



 


		5.2	Cancellation. To the extent that cash in lieu of shares of Common Stock is delivered upon the
exercise of an SAR pursuant to Section 7.4, the Company shall be deemed, for purposes of applying the limitation on the number
of shares, to have issued the greater of the number of shares of Common Stock which it was entitled to issue upon such exercise
or upon the exercise of any related option. In the event that a stock option or SAR granted hereunder expires or is terminated
or canceled unexercised or unvested as to any shares of Common Stock, such shares may again be issued under the Plan either pursuant
to stock options, SARs or otherwise. In the event that shares of Common Stock are issued hereunder as restricted stock or pursuant
to a stock award and thereafter are forfeited or reacquired by the Company pursuant to rights reserved upon issuance thereof, such
forfeited and reacquired shares may again be issued under the Plan, either as restricted stock, pursuant to stock awards or otherwise.
The Committee may also determine to cancel, and agree to the cancellation of, stock options in order to make a participant eligible
for the grant of a stock option at a lower price than the option to be canceled.



 



    	2



    	Exhibit 10.1



    



6.Stock
Options.


 


A stock option is a right to purchase shares
of Common Stock from the Company. The Committee may designate whether an option is to be considered an incentive stock option or
a non-statutory stock option. To the extent that any incentive stock option granted under the Plan ceases for any reason to qualify
as an “incentive stock option” for purposes of Section 422 of the Code, such incentive stock option will continue to
be outstanding for purposes of the Plan but will thereafter be deemed to be a non-statutory stock option. Each stock option granted
by the Committee under this Plan shall be subject to the following terms and conditions:


 


		6.1	Price. The option price per share shall be determined by the Committee, subject to adjustment
under Section 11.6.



 





		6.2	Number. The number of shares of Common Stock subject to the option shall be determined by the
Committee, subject to adjustment as provided in Section 11.6. The number of shares of Common Stock subject to a stock option shall be reduced in the same proportion
that the holder thereof exercises a SAR if any SAR is granted in conjunction with or related to the stock option. To the extent
required by Section 162(m) of the Code, as amended (the "Code"), and the rules and regulations thereunder, no individual
may receive options to purchase more than 200,000 shares (subject to adjustment as provided in Section 11.6) in any year.



 





		6.3	Term and Time for Exercise. Subject to earlier termination as provided in Section 11.4, the
term of each stock option shall be determined by the Committee but shall not exceed ten (10) years and one day from the date of
grant. Each stock option shall become exercisable at such time or times during its term as shall be determined by the Committee
at the time of grant. The Committee may in its discretion accelerate the exercisability of any stock option. Subject to the foregoing
and with the approval of the Committee, all or any part of the shares of Common Stock with respect to which the right to purchase
has accrued may be purchased by the Company at the time of such accrual or at any time or times thereafter during the term of the
option.



 


		6.4	Manner of Exercise. Subject to the conditions contained in this Plan and in the agreement with
the recipient evidencing such option, a stock option may be exercised, in whole or in part, by giving written notice to the Company,
specifying the number of shares of Common Stock to be purchased and accompanied by the full purchase price for such shares. The
exercise price shall be payable (a) in United States dollars upon exercise of the option and may be paid by cash; uncertified or
certified check; or bank draft; (b) at the discretion of the Committee, by delivery of shares of Common Stock already owned by
the participant in payment of all or any part of the exercise price, which shares shall be valued for this purpose at the Fair
Market Value (as defined in Section 11.11 below) on the date such option is exercised; or (c) at the discretion of the Committee,
by instructing the Company to withhold from the shares of Common Stock issuable upon exercise of the stock option shares of Common
Stock in payment of all or any part of the exercise price and/or any related withholding-tax obligations, which shares shall be
valued for this purpose at the Fair Market Value or in such other manner as may be authorized from time to time by the Committee.
Any shares of Common Stock delivered by a participant pursuant to clause (b) above must have been held by the participant for a
period of not less than six (6) months prior to the exercise of the option, unless otherwise determined by the Committee. Prior
to the issuance of shares of Common Stock upon the exercise of a stock option, a participant shall have no rights as a shareholder
with respect to shares of Common Stock issuable under such stock option. Except as otherwise provided in the Plan, no adjustment
will be made for dividends or distributions declared as of a record date preceding the date on which a participant becomes the
holder of record of shares of Common Stock acquired upon exercise of a stock option, except as the Committee may determine in its
sole discretion.



 



    	3



    	Exhibit 10.1



    



		6.5	Incentive Stock Options. Notwithstanding anything in the Plan to the contrary, the following
additional provisions shall apply to the grant of stock options which are intended to qualify as incentive stock options (as such
term is defined in Section 422 of the Code):



 


		(a)	The aggregate Fair Market Value (determined as of
the time the option is granted) of the shares of Common Stock with respect to which incentive stock options are exercisable for
the first time by any participant during any calendar year (under the Plan and any other incentive stock-option plans of the Company
or any subsidiary or parent corporation of the Company) shall not exceed $100,000. The determination will be made by taking incentive
stock options into account in the order in which they were granted.



 


		(b)	Any certificate for an incentive stock option authorized
under the Plan shall contain such other provisions as the Committee shall deem advisable, but shall in all events be consistent
with and contain all provisions required in order to qualify the options as incentive stock options.



 


		(c)	All incentive stock options must be granted within
ten (10) years from the earlier of the date on which this Plan was adopted by board of directors or the date this Plan was approved
by the Company’s shareholders.



 


		(d)	Unless sooner exercised, all incentive stock options
shall expire no later than ten (10) years after the date of grant. No incentive stock option may be exercisable after ten (10)
years from its date of grant (or five (5) years from its date of grant if, at the time of grant, the participant owns, directly
or indirectly, more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any parent
or subsidiary corporation of the Company).



 


		(e)	The exercise price for a share of Common Stock under
an incentive stock options shall be not less than one hundred percent (100%) of the Fair Market Value of one share of Common Stock
on the date of grant; provided, however, that the exercise price shall be one hundred ten percent (110%) of the Fair Market Value
if, at the time the incentive stock option is granted, the participant owns, directly or indirectly, more than ten percent (10%)
of the total combined voting power of all classes of stock of the Company or any parent or subsidiary corporation of the Company.



 


7.Stock-Appreciation
Rights.


 


An SAR is a right to receive, without payment
to the Company, a number of shares of Common Stock, cash, or any combination thereof, the amount of which is determined pursuant
to the formula set forth in Section 7.4. An SAR may be granted (a) with respect to any stock option granted under this Plan, either
concurrently with the grant of such stock option or at such later time as determined by the Committee (as to all or any portion
of the shares of Common Stock subject to the stock option), or (b) alone, without reference to any related stock option. Each SAR
granted by the Committee under this Plan shall be subject to the following terms and conditions:


 



    	4



    	Exhibit 10.1



    



		7.1	Number; Exercise Price. Each SAR granted to any participant shall relate to such number of
shares of Common Stock as shall be determined by the Committee, subject to adjustment as provided in Section 11.6. In the case of an SAR granted with respect to a stock option, the number of shares of Common Stock to
which the SAR pertains shall be reduced in the same proportion that the holder of the option exercises the related stock option.
The exercise price of an SAR will be determined by the Committee, in its discretion, at the date of grant but may not be less than
one hundred percent (100%) of the Fair Market Value of one share of Common Stock on the date of grant.



 





		7.2	Duration. Subject to earlier termination as provided in Section 11.4, the term of each SAR
shall be determined by the Committee but shall not exceed ten (10) years and one day from the date of grant. Unless otherwise provided
by the Committee, each SAR shall become exercisable at such time or times, to such extent and upon such conditions as the stock
option, if any, to which it relates is exercisable. The Committee may in its discretion accelerate the exercisability of any SAR.



 


		7.3	Exercise. An SAR may be exercised, in whole or in part, by giving written notice to the Company,
specifying the number of SARs which the holder wishes to exercise. Upon receipt of such written notice, the Company shall, within
ninety (90) days thereafter, deliver to the exercising holder certificates for the shares of Common Stock or cash, or both, as
determined by the Committee, to which the holder is entitled pursuant to Section 7.4.



 


		7.4	Payment. Subject to the right of the Committee to deliver cash in lieu of shares of Common
Stock (which, as it pertains to Company officers and directors, shall comply with all requirements of the Exchange Act), the number
of shares of Common Stock which shall be issuable upon the exercise of an SAR shall be determined by dividing:



 


		(a)	the number of shares of Common Stock as to which the
SAR is exercised multiplied by the amount of the appreciation in such shares (i.e., the amount by which the Fair Market Value
of the shares of Common Stock subject to the SAR on the exercise date exceeds (1) in the case of an SAR related to a stock option,
the exercise price of the shares of Common Stock under the stock option or (2) in the case of an SAR granted alone and without
reference to a related stock option, an amount which shall be determined by the Committee at the time of grant, subject to adjustment
under Section 11.6); by



 





		(b)	the Fair Market Value of a share of Common Stock on
the exercise date.



 


In lieu of issuing shares of Common
Stock upon the exercise of a SAR, the Committee may elect to pay the holder of the SAR cash equal to the Fair Market Value on the
exercise date of any or all of the shares which would otherwise be issuable. No fractional shares of Common Stock shall be issued
upon the exercise of an SAR; instead, the holder of the SAR shall be entitled to receive a cash adjustment equal to the same fraction
of the Fair Market Value of a share of Common Stock on the exercise date or to purchase the portion necessary to make a whole share
at its Fair Market Value on the date of exercise.


 


8.Stock
Awards and Restricted Stock.


 


A stock award consists of the transfer by
the Company to a participant of shares of Common Stock, without other payment therefor, as additional compensation for services
rendered to the Company. The participant receiving a stock award will have all voting, dividend, liquidation and other rights with
respect to the shares of Common Stock issued to a participant as a stock award under this Section 8 upon the participant becoming
the holder of record of such shares. A share of restricted stock consists of shares of Common Stock which are sold or transferred
by the Company to a participant at a price determined by the Committee (which price shall be at least equal to the minimum price
required by applicable law for the issuance of a share of Common Stock) and subject to restrictions on their sale or other transfer
by the participant, which restrictions and conditions may be determined by the Committee as long as such restrictions and conditions
are not inconsistent with the terms of the Plan. The transfer of Common Stock pursuant to stock awards and the transfer and sale
of restricted stock shall be subject to the following terms and conditions:


 



    	5



    	Exhibit 10.1



    



		8.1	Number of Shares. The number of shares to be transferred or sold by the Company to a participant
pursuant to a stock award or as restricted stock shall be determined by the Committee.



 


		8.2	Sale Price. The Committee shall determine the price, if any, at which shares of restricted
stock shall be sold or granted to a participant, which may vary from time to time and among participants and which may be below
the Fair Market Value of such shares of Common Stock at the date of sale.



 


		8.3	Restrictions. All shares of restricted stock transferred or sold hereunder shall be subject
to such restrictions as the Committee may determine, including without limitation any or all of the following:



 


		(a)	a prohibition against the sale, transfer, pledge or
other encumbrance of the shares of restricted stock, such prohibition to lapse at such time or times as the Committee shall determine
(whether in annual or more frequent installments, at the time of the death, disability or retirement of the holder of such shares,
or otherwise);



 


		(b)	a requirement that the holder of shares of restricted
stock forfeit, or (in the case of shares sold to a participant) resell back to the Company at his or her cost, all or a part of
such shares in the event of termination of his or her employment or consulting engagement during any period in which such shares
are subject to restrictions; or



 


		(c)	such other conditions or restrictions as the Committee
may deem advisable.



 


In order to enforce the restrictions
imposed by the Committee pursuant to Section 8.3, the participant receiving restricted stock shall enter into an agreement with
the Company setting forth the conditions of the grant. Shares of restricted stock shall be registered in the name of the participant
and deposited, together with a stock power endorsed in blank, with the Company unless otherwise determined by the Committee. Each
such certificate shall bear a legend in substantially the following form:


 


THE TRANSFERABILITY OF THIS
CERTIFICATE AND THE SHARES OF COMMON STOCK REPRESENTED BY IT ARE SUBJECT TO THE TERMS AND CONDITIONS (INCLUDING CONDITIONS OF FORFEITURE)
CONTAINED IN THE 2012 STOCK OPTION PLAN OF PROUROCARE MEDICAL INC., (THE “COMPANY”), AND AN AGREEMENT ENTERED INTO
BETWEEN THE REGISTERED OWNER AND THE COMPANY. A COPY OF THE 2012 STOCK OPTION PLAN AND THE AGREEMENT IS AVAILABLE FROM THE COMPANY
UPON REQUEST.


 



    	6



    	Exhibit 10.1



    



		8.4	End of Restrictions.  Subject to Section 11.3, at the end of any time period during
which the shares of restricted stock are subject to forfeiture and restrictions on transfer, such shares will be delivered free
of all restrictions to the participant or to the participant’s legal representative, beneficiary or heir.



 


		8.5	Shareholder. Subject to the terms and conditions of the Plan, each participant receiving restricted
stock shall have all the rights of a shareholder with respect to shares of stock during any period in which such shares are subject
to forfeiture and restrictions on transfer, including without limitation the right to vote such shares. Dividends paid in cash
or property other than Common Stock with respect to shares of restricted stock shall be paid to the participant currently. Unless
the Committee determines otherwise in its sole discretion, any dividends or distributions (including regular quarterly cash dividends)
paid with respect to shares of Common Stock subject to the restrictions set forth above will be subject to the same restrictions
as the shares to which such dividends or distributions relate. In the event the Committee determines not to pay dividends or distributions
currently, the Committee will determine in its sole discretion whether any interest will be paid on such dividends or distributions.
In addition, the Committee in its sole discretion may require such dividends and distributions to be reinvested (and in such case
the participant consents to such reinvestment) in shares of Common Stock that will be subject to the same restrictions as the shares
to which such dividends or distributions relate.



 


9.Performance
Shares.


 


A performance share consists of an award which shall be paid
in shares of Common Stock, as described below. The grant of a performance share shall be subject to such terms and conditions as
the Committee deems appropriate, including the following:


 


		9.1	Performance Objectives. Each performance share will be subject to performance objectives
respecting the Company or one of its operating units to be achieved by the participant before the end of a specified period. The
Committee shall determine the terms and conditions of each grant and the number of performance shares granted. If the performance
objectives are achieved, the participant will be paid in shares of Common Stock as determined by the Committee. If such objectives
are not met, each grant of performance shares may provide for lesser payments in accordance with formulae established in the award.



 


		9.2	Not Shareholder. The grant of performance shares to a participant shall not create any rights
in such participant as a shareholder of the Company, until the payment of shares of Common Stock with respect to an award.



 


		9.3	No Adjustments. No adjustment shall be made in performance shares granted on account of cash
dividends which may be paid or other rights which may be issued to the holders of Common Stock prior to the end of any period for
which performance objectives were established.



 


		9.4	Expiration of Performance Shares. If any participant’s employment or consulting engagement
with the Company is terminated for any reason other than normal retirement, death or disability prior to the achievement of the
participant’s stated performance objectives, all the participant’s rights on the performance shares shall expire and
terminate unless otherwise determined by the Committee. In the event of termination of employment or consulting by reason of death,
disability, or normal retirement, the Committee, in its own discretion may determine what portions, if any, of the performance
shares should be paid to the participant.



 



    	7



    	Exhibit 10.1



    



10.Change
of Control.


 


		10.1	Change in Control. For purposes of this Section 10, a “Change in Control” of the
Company will mean the following:



 


		(a)	The purchase or other acquisition by any one person,
or more than one person acting as a group, of stock of the Company that, together with stock held by such person or group, constitutes
more than fifty percent (50%) of the total combined value or total combined voting power of all classes of stock issued by the
Company; provided, however, that if any one person or more than one person acting as a group is considered to own more than fifty
percent (50%) of the total combined value or total combined voting power of such stock, the acquisition of additional stock by
the same person or persons shall not be considered a Change of Control;



 


		(b)	A merger or consolidation to which the Company is
a party if the individuals and entities who were shareholders of the Company immediately prior to the effective date of such merger
or consolidation have, immediately following the effective date of such merger or consolidation, beneficial ownership (as defined
in Rule 13d-3 under the Securities Exchange Act of 1934) of less than fifty percent (50%) of the total combined voting power of
all classes of securities issued by the surviving entity for the election of directors of the surviving corporation;



 


		(c)	Any one person, or more than one person acting as
a group, acquires or has acquired during the twelve (12) month period ending on the date of the most recent acquisition by such
person or persons, direct or indirect beneficial ownership (as defined in Rule 13d-3 under the Securities Exchange Act of 1934)
of stock of the Company constituting more than thirty (30%) of the total combined voting power of all classes of stock issued
by the Company;



 


		(d)	The purchase or other acquisition by any one person,
or more than one person acting as a group, of substantially all of the total gross value of the assets of the Company during the
twelve-month period ending on the date of the most recent purchase or other acquisition by such person or persons. For purposes
of this Section 2(d), “gross value” means the value of the assets of the Company or the value of the assets being
disposed of, as the case may be, determined without regard to any liabilities associated with such assets;



 


		(e)	A change in the composition of the Board of the Company
at any time during any consecutive twelve (12) month period such that the “Continuity Directors” cease for any reason
to constitute at least a majority of the Board. For purposes of this event, “Continuity Directors” means those members
of the Board who either:



 


		(1)	were directors at the beginning of such consecutive twelve
(12) month period; or



 


		(2)	were elected by, or on the nomination or recommendation
of, at least a majority of the then-existing Board of Directors.



 


In all cases, the
determination of whether a Change of Control Event has occurred shall be made in accordance with Code Section 409A and the regulations,
notices and other guidance of general applicability issued thereunder.


 



    	8



    	Exhibit 10.1



    



		10.2.	Acceleration of Incentives. Without limiting the authority of the Committee under the
Plan, if a Change in Control of the Company occurs whereby the acquiring entity or successor to the Company does not assume the
Incentives or replace them with substantially equivalent incentive awards, then, unless otherwise provided by the Committee in
its sole discretion in the agreement evidencing an Incentive at the time of grant, as of the date of the Change of Control: (a)
all outstanding options and SARs will vest and will become immediately exercisable in full and will remain exercisable for the
remainder of their respective terms, regardless of whether the participant to whom such options or SARs have been granted remains
in the employ or service of the Company or any subsidiary of the Company or any acquiring entity or successor to the Company; (b)
the restrictions on all shares of restricted stock awards shall lapse immediately; and (c) all performance shares shall be deemed
to be met and payment made immediately.



 


		10.3.	Cash Payment for Options. If a Change in Control of the Company occurs, then the Committee,
if approved by the Committee in its sole discretion either in an agreement evidencing an option at the time of grant or at any
time after the grant of an option, and without the consent of any participant affected thereby, may determine that:



 


		(a)	some or all participants holding outstanding stock
options will receive, with respect to some or all of the shares of Common Stock subject to such options, as of the effective date
of any such Change in Control of the Company, cash in an amount equal to the excess of the Fair Market Value of such shares immediately
prior to the effective date of such Change in Control of the Company over the exercise price per share of such options; and



 


		(b)	any options as to which, as of the effective date
of any such Change in Control, the Fair Market Value of the shares of Common Stock subject to such options is less than or equal
to the exercise price per share of such options, shall terminate as of the effective date of any such Change in Control.



 


If the Committee makes a determination
as set forth in subparagraph (a) of this Section 10.3, then, as of the effective date of any such Change in Control of the Company,
such options will terminate as to such shares and the participants formerly holding such options will only have the right to receive
such cash payment(s). If the Committee makes a determination as set forth in subparagraph (b) of this Section 10.3, then, as of
the effective date of any such Change in Control of the Company, such options will terminate, become void and expire as to all
unexercised shares of Common Stock subject to such options on such date, and the participants formerly holding such options will
have no further rights with respect to such options.


 


11.General.


 


		11.1	Effective Date. The Plan will become effective upon its approval by the affirmative vote of
the holders of a majority of the voting power of the shares of the Company's Common Stock present and entitled to vote at a meeting
of the stockholders. Unless approved within one year after the date of the Plan's adoption by the board of directors, the Plan
shall not be effective for any purpose.



 


		11.2	Duration. The Plan shall remain in effect until all Incentives granted under the Plan have
either been satisfied by the issuance of shares of Common Stock or the payment of cash or have been terminated under the terms
of the Plan and all restrictions imposed on shares of Common Stock in connection with their issuance under the Plan have lapsed.
No Incentives may be granted under the Plan after the tenth anniversary of the date the Plan is approved by the shareholders of
the Company.



 



    	9



    	Exhibit 10.1



    



		11.3	Non-Transferability of Incentives. No Incentive Stock Option, SAR, restricted stock or performance
award may be transferred, pledged or assigned by the holder thereof (except, in the event of the holder’s death, by will
or the laws of descent and distribution to the limited extent provided in the Plan or the Incentive, or pursuant to a qualified
domestic relations order as defined by the Code or Title I of the Employee Retirement Income Security Act, or the rules thereunder),
and the Company shall not be required to recognize any attempted assignment of such rights by any participant. Incentive Stock
Options transferred (except as permitted in the preceding sentence) will continue to be outstanding for purposes of the Plan but
will thereafter be deemed to be a non-qualified stock option. Non-qualified stock options may be transferred by the holder thereof
only to such holder’s spouse, children, grandchildren or parents (collectively, the “Family Members”), to trusts
for the benefit of Family Members, to partnerships or limited liability companies in which Family Members are the only partners
or shareholders, or to entities exempt from federal income taxation pursuant to Section 501(c)(3) of the Code. During a participant’s
lifetime, a stock option may be exercised only by him or her, by his or her guardian or legal representative or by the transferees
permitted by this Section 11.3.



 


		11.4	Effect of Termination or Death. In the event that a participant ceases to be an employee of
or consultant to the Company, or the participant’s other service with the Company is terminated, for any reason, including
death, any Incentives may be exercised or shall expire at such times as may be determined by the Committee in its sole discretion
in the agreement evidencing an Incentive. Notwithstanding the other provisions of this Section 11.4, upon a participant’s
termination of employment or other service with the Company and all subsidiaries, the Committee may, in its sole discretion (which
may be exercised at any time on or after the date of grant, including following such termination), cause options and SARs (or any
part thereof) then held by such participant to become or continue to become exercisable and/or remain exercisable following such
termination of employment or service and restricted stock awards, performance shares and stock awards then held by such participant
to vest and/or continue to vest or become free of transfer restrictions, as the case may be, following such termination of employment
or service, in each case in the manner determined by the Committee; provided, however, that no option or SAR may remain exercisable
or continue to vest beyond the earlier of (i) the latest date upon which the Incentive could have expired by its original terms,
and (ii) the tenth (10th) anniversary of the original date of grant. Any incentive stock option that remains unexercised more than
one (1) year following termination of employment by reason of death or disability or more than three (3) months following termination
for any reason other than death or disability will thereafter be deemed to be a non-statutory stock option. Further, this Section
11.4 shall be administered in compliance with Code Section 409A and the notices, regulations and other guidance of general applicability
issued thereunder.



 


		11.5	Additional Conditions. Notwithstanding anything in this Plan to the contrary: (a) the Company
may, if it shall determine it necessary or desirable for any reason, at the time of award of any Incentive or the issuance of any
shares of Common Stock pursuant to any Incentive, require the recipient of the Incentive, as a condition to the receipt thereof
or to the receipt of shares of Common Stock issued pursuant thereto, to deliver to the Company a written representation of present
intention to acquire the Incentive or the shares of Common Stock issued pursuant thereto for his or her own account for investment
and not for distribution; and (b) if at any time the Company further determines, in its sole discretion, that the listing, registration
or qualification (or any updating of any such document) of any Incentive or the shares of Common Stock issuable pursuant thereto
is necessary on any securities exchange or under any federal or state securities law, or that the consent or approval of any governmental
regulatory body is necessary or desirable as a condition of, or in connection with the award of any Incentive, the issuance of
shares of Common Stock pursuant thereto, or the removal of any restrictions imposed on such shares, such Incentive shall not be
awarded or such shares of Common Stock shall not be issued or such restrictions shall not be removed, as the case may be, in whole
or in part, unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of
any conditions unacceptable to the Company. Notwithstanding any other provision of the Plan or any agreements entered into pursuant
to the Plan, the Company will not be required to issue any shares of Common Stock under this Plan, and a participant may not sell,
assign, transfer or otherwise dispose of shares of Common Stock issued pursuant to any Incentives granted under the Plan, unless
(a) there is in effect with respect to such shares a registration statement under the Securities Act of 1933, as amended (the “Securities
Act”), and any applicable state or foreign securities laws or an exemption from such registration under the Securities Act
and applicable state or foreign securities laws, and (b) there has been obtained any other consent, approval or permit from any
other regulatory body which the Committee, in its sole discretion, deems necessary or advisable. The Company may condition such
issuance, sale or transfer upon the receipt of any representations or agreements from the parties involved, and the placement of
any legends on certificates representing shares of Common Stock, as may be deemed necessary or advisable by the Company in order
to comply with such securities law or other restrictions.



 



    	10



    	Exhibit 10.1



    



		11.6	Adjustment. In the event of any merger, consolidation or reorganization of the Company with
any other corporation or corporations, there shall be substituted for each of the shares of Common Stock then subject to the Plan,
including shares subject to restrictions, options or achievement-of-performance share objectives, the number and kind of shares
of stock or other securities to which the holders of the shares of Common Stock will be entitled pursuant to the transaction. In
the event of any recapitalization, reclassification, stock dividend, stock split, combination of shares or other similar change
in the corporate structure of the Company or shares of the Company, the exercise price of an outstanding Incentive and the number
of shares of Common Stock then subject to the Plan, including shares subject to restrictions, options or achievements of performance
shares, shall be adjusted in proportion to the change in outstanding shares of Common Stock in order to prevent dilution or enlargement
of the rights of the participants. In the event of any such adjustments, the purchase price of any option, the performance objectives
of any Incentive, and the shares of Common Stock issuable pursuant to any Incentive shall be adjusted as and to the extent appropriate,
in the discretion of the Committee, to provide participants with the same relative rights before and after such adjustment.



 


		11.7	Incentive Plans and Agreements. Except in the case of stock awards, the terms of each Incentive
shall be stated in a plan or agreement approved by the Committee. The Committee may also determine to enter into agreements with
holders of options to reclassify or convert certain outstanding options, within the terms of the Plan, as Incentive Stock Options
or as non-statutory stock options and in order to eliminate SARs with respect to all or part of such options and any other previously
issued options.



 


		11.8	Withholding.



 


		(a)	The Company shall have the right to (i) withhold and
deduct from any payments made under the Plan or from future wages of the participant (or from other amounts that may be due and
owing to the participant from the Company or a subsidiary of the Company), or make other arrangements for the collection of, all
legally required amounts necessary to satisfy any and all foreign, federal, state and local withholding and employment-related
tax requirements attributable to an Incentive, or (ii) require the participant promptly to remit the amount of such withholding
to the Company before taking any action, including issuing any shares of Common Stock, with respect to an Incentive. At any time
when a participant is required to pay to the Company an amount required to be withheld under applicable income tax laws in connection
with a distribution of Common Stock or upon exercise of an option or SAR, the participant may satisfy this obligation in whole
or in part by electing (the “Election”) to have the Company withhold from the distribution shares of Common Stock
having a value up to the amount required to be withheld. The value of the shares to be withheld shall be based on the Fair Market
Value of the Common Stock on the date that the amount of tax to be withheld shall be determined (the “Tax Date”).



 



    	11



    	Exhibit 10.1



    



		(b)	The Committee may disapprove of any Election, may
suspend or terminate the right to make Elections, or may provide with respect to any Incentive that the right to make Elections
shall not apply to such Incentive. An Election is irrevocable.



 


		(c)	If a participant is a Company officer or director
within the meaning of Section 16 of the Exchange Act, then an Election is subject to the following additional restrictions: (a)
no Election shall be effective for a Tax Date which occurs within six (6) months of the grant or exercise of the award, except
that this limitation shall not apply in the event death or disability of the participant occurs prior to the expiration of the
six-month period; and (b) the Election must be made either six months prior to the Tax Date or must be made during a period beginning
on the third business day following the date of release for publication of the Company’s quarterly or annual summary statements
of sales and earnings and ending on the twelfth business day following such date.



 


		11.9	No Continued Employment, Engagement or Right to Corporate Assets. No participant under the
Plan shall have any right, because of his or her participation, to continue in the employ of the Company for any period of time
or to any right to continue his or her present or any other rate of compensation. Nothing contained in the Plan shall be construed
as giving an employee, a consultant, such persons’ beneficiaries or any other person any equity or interests of any kind
in the assets of the Company or creating a trust of any kind or a fiduciary relationship of any kind between the Company and any
such person.



 


		11.10	Amendment of the Plan. The Board may amend, suspend or discontinue the Plan at any time; provided,
however, that no amendments to the Plan will be effective without approval of the shareholders of the Company if shareholder approval
of the amendment is then required pursuant to Section 422 of the Code or the rules of any stock exchange or Nasdaq or similar regulatory
body. No termination, suspension or amendment of the Plan may adversely affect any outstanding Incentive without the consent of
the affected participant; provided, however, that this sentence will not impair the right of the Committee to take whatever
action it deems appropriate under Section 11.5 of the Plan.



 





		11.11	Definition of Fair Market Value. For purposes of this Plan, the “Fair Market Value”
of a share of Common Stock at a specified date shall, unless otherwise expressly provided in this Plan, be the amount which the
Committee or the Company’s board of directors determines in good faith in the exercise of its reasonable discretion to be
one hundred percent (100%) of the fair market value of such a share as of the date in question; provided, however, that
notwithstanding the foregoing, if such shares are listed on a U.S. securities exchange or are quoted on the Nasdaq National Market
System, Nasdaq SmallCap Stock Market (“Nasdaq”), or the Over-The-Counter Bulletin Board (“OTCBB”), then
Fair Market Value shall be determined by reference to the last sale price of a share of Common Stock on such U.S. securities exchange,
Nasdaq, or OTCBB, on the applicable date. If such U.S. securities exchange, Nasdaq, or OTCBB is closed for trading on such date,
or if the Common Stock does not trade on such date, then the last sale price used shall be the one on the date the Common Stock
last traded.



 



    	12



    	Exhibit 10.1



    



		11.12	Breach of Confidentiality, Assignment of Inventions, or Non-Compete Agreements. Notwithstanding
anything in the Plan to the contrary, in the event that a participant materially breaches the terms of any confidentiality, assignment-of-inventions,
or noncompete agreement entered into with the Company or any parent or subsidiary of the Company, whether such breach occurs before
or after termination of such participant’s employment or other service with the Company or any subsidiary, the Committee
in its sole discretion may immediately terminate all rights of the participant under the Plan and any agreements evidencing an
Incentive then held by the participant without notice of any kind.



 


		11.13	Governing Law. The validity, construction, interpretation, administration and effect of the
Plan and any rules, regulations and actions relating to the Plan will be governed by and construed exclusively in accordance with
the laws of the State of Minnesota, notwithstanding the conflicts-of-law principles of Minnesota or any other jurisdiction.



 


		11.14	Successors and Assigns. The Plan will be binding upon and inure to the benefit of the successors
and permitted assigns of the Company and the participants in the Plan.



 


 



    	13