Exhibit 10.1


 


B. RILEY FINANCIAL, INC.


Amended and Restated 2009 Stock Incentive
Plan


 


(formerly Great American Group, Inc.


Amended and Restated 2009 Stock Incentive
Plan)


 


(formerly Alternative Asset Management
Acquisition Corp.


2009 Stock Incentive Plan)


  


 






Plan Document





 









  


1.          Establishment,
Purpose, and Types of Awards. B. Riley Financial, Inc. (the “Company”) hereby establishes this equity-based
incentive compensation plan (originally established by Alternative Asset Management Acquisition Corp.) to be known as the “B.
Riley Financial, Inc. Amended and Restated 2009 Stock Incentive Plan” (hereinafter referred to as the “Plan”),
for the following purposes: (a) to enhance the Company’s ability to attract highly qualified personnel; (b) to
strengthen its retention capabilities; (c) to enhance the long-term performance and competitiveness of the Company; and (d) to
align the interests of Participants with those of the Company’s shareholders.


 


(a)          Effective
Date. This Plan shall become effective upon the date adopted by the Board of Directors of the Company; provided that no Awards
shall be granted hereunder until the Plan has been approved by a vote of a majority of the votes cast at a duly held meeting of
the Company’s shareholders (or by such other shareholder vote that the Committee determines to be sufficient for the issuance
of Shares and Awards according to the Company’s governing documents and Applicable Law).


 


(b)          Awards.
The Plan permits the granting of the following types of Awards according to the Sections of the Plan listed here:


 


	Section 5	Stock Options
	Section 6	Share Appreciation Rights (SARs)
	Section 7	Restricted Shares, Restricted Share Units (RSUs), and Unrestricted Shares
	Section 8	Deferred Share Units (DSUs)
	Section 9	Performance Awards


 


(c)          Appendices.
Incorporated by reference and thereby part of the Plan are the terms set forth in Appendix I.


 


(d)          Effect
on Other Plans, Awards, and Arrangements. This Plan is not intended to affect and shall not affect any stock options, equity-based
compensation, or other benefits that the Company or its Affiliates may have provided, or may separately provide in the future,
pursuant to any agreement, plan, or program that is independent of this Plan. Notwithstanding the foregoing, effective upon shareholder
approval of this Plan, no further awards shall be granted under the Pride Capital Group, LLC Phantom Stock Plan.


 


2.          Defined
Terms. Terms in the Plan and any Appendix that begin with an initial capital letter have the defined meaning set forth
in Appendix I, unless the context indicates a different meaning.


 




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3.          Shares
Subject to the Plan. Subject to adjustment pursuant to Section 13 below, a total of 3,210,133 Shares shall be available
for issuance under the Plan. The Shares deliverable pursuant to Awards shall be authorized, but unissued Shares, or Shares that
the Company otherwise holds in treasury or in trust. Any Shares subject to an Award that is settled in cash rather than in Shares,
or subject to an Award that expires or is forfeited, cancelled or otherwise terminated without the issuance of some or all of the
Shares subject to the Award will again be available for future Awards to the extent of such cash settlement, or non-issuance due
to expiration, forfeiture, cancellation or termination. In addition, previously issued Shares that are not related to a particular
Award (e.g., Shares already owned by a Participant) and Shares subject to an Award that are tendered or withheld by the Company
in payment of all or part of the exercise price of such Award or in satisfaction of applicable Withholding Taxes shall be added
to the number of Shares available for issuance under the Plan. Further, and to the extent permitted under Applicable Laws: (i)
the maximum number of Shares available for delivery under the Plan shall not be reduced by any Shares issued under the Plan through
the settlement, assumption, or substitution of outstanding awards or obligations to grant future awards in connection with the
acquisition by the Company (or an Affiliate of the Company) of another entity; and (ii) the maximum number of Shares available
for delivery under the Plan shall be increased by the number of shares available for issuance under any shareholder approved plan
of an entity acquired by the Company or an Affiliate of the Company (as such number has been equitably adjusted by the Committee
to give effect to the acquisition).


 


4.          Eligibility.


 


(a)          General
Rule. Awards may only be made to Eligible Persons (as determined for each Award on its Grant Date). Each Award shall be evidenced
by an Award Agreement that sets forth its Grant Date and all other terms and conditions of the Award, that is signed on behalf
of the Company (or delivered by an authorized agent through an electronic medium), and that, if required by the Committee, is signed
by the Eligible Person as an acceptance of the Award. The grant of an Award shall not obligate the Company or any Affiliate to
continue the employment or service of any Eligible Person, or to provide any future Awards or other remuneration at any time thereafter.


 


(b)          Limits
on Individual Awards. The maximum number of Shares with respect to which Options, SARs, and Performance Awards may be granted
to any Participant in any calendar year shall be 1,000,000 Shares. The foregoing limitations shall be adjusted proportionately
in connection with any change in the Company’s capitalization pursuant to Section 13(a), below. To the extent required by
Section 162(m) of the Code or the regulations thereunder, in applying the foregoing limitations with respect to a Participant,
if any Option or SAR is canceled, the canceled Option or SAR shall continue to count against the maximum number of Shares with
respect to which Options and SARs may be granted to the Grantee. For this purpose, the repricing of an Option or SAR shall be treated
as the cancellation of the existing Option or SAR and the grant of a new Option or SAR.


 


(c)          Replacement
Awards. Subject to Applicable Laws (including any associated shareholder approval requirements), the Committee may, in its
sole discretion and upon such terms as it deems appropriate, require as a condition for granting an Award that an Eligible Person
surrender for cancellation some or all Awards that have previously been granted under this Plan or otherwise. An Award conditioned
upon such surrender may or may not be the same type of Award, may cover the same (or a lesser or greater) number of Shares as such
surrendered Award, may have other terms that are determined without regard to the terms or conditions of such surrendered Award,
and may contain any other terms that the Committee deems appropriate. Except in connection with a Change in Control, Options or
SARs with a per Share exercise price (as adjusted pursuant to Section 13 below) higher than Fair Market Value may not be cancelled
under this Section 4(c) without the approval of the Company’s shareholders.


 


5.          Stock
Options.


 


(a)          Grants.
The Committee may grant Options to Eligible Persons pursuant to Award Agreements setting forth terms and conditions that are not
inconsistent with the Plan, and that may include vesting or other requirements for the right to exercise the Option; provided that
–


 


(i)          the
exercise price for Shares subject to purchase through exercise of an Option shall not be less than 100% of the Fair Market Value
of the underlying Shares on the Grant Date; and


 


(ii)         no
Option shall be exercisable for a term ending more than ten years after its Grant Date.


 




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(b)          Method
of Exercise. Subject to Section 14 below, Options may be exercised by the Participant (or his guardian or personal representative)
giving notice to the Company pursuant to procedures established by the Company for the exercise of Options. Such notice shall state
the number of Shares the Participant has elected to purchase under the Option and the method by which the exercise price and any
applicable Withholding Taxes will be paid. The exercise price and Withholding Taxes may be paid in cash or check payable to the
Company (in U.S. dollars), or to the extent that the Committee or the terms of an Award Agreement expressly permit, all or any
part of the exercise price or Withholding Taxes may be satisfied –


 


(i)          by
delivery or attestation of Shares (valued at their Fair Market Value) that are subject to the Option being exercised or that the
Participant already owns;


 


(ii)         by
delivery of a properly executed exercise notice with irrevocable instructions to a broker to deliver to the Company the amount
necessary to pay the exercise price or Withholding Taxes from the sale or proceeds of a loan from the broker with respect to the
sale of Shares or a broker loan secured by Shares; or


 


(iii)        by
a combination of (i) and (ii).


 


An Award Agreement for an Option may provide that, if, on the
date upon which such Option or any portion thereof is to expire, Fair Market Value exceeds the per Share exercise price of such
Option and if such Option or portion thereof that will expire is otherwise exercisable, the Option shall be automatically exercised
by delivery or attestation of Shares that are subject to such Option in satisfaction of the exercise price and any applicable Withholding
Taxes.


 


(c)          Exercise
of an Unvested Option. The Committee in its sole discretion may allow a Participant to exercise an unvested Option, in which
case the Shares then issued shall be Restricted Shares having analogous vesting restrictions to the unvested Option.


 


(d)          Termination
of Continuous Service. The Committee may establish and set forth in the applicable Award Agreement the terms and conditions
on which an Option shall remain exercisable following termination of a Participant’s Continuous Service. Except to the extent
an Award Agreement specifically provides otherwise, an Option shall be exercisable, only to the extent the Participant was entitled
to exercise such Option at the date of terminating Continuous Service, only until the “Option Termination Date” determined
pursuant to the following table:


 


	Reason for terminating Continuous Service	 	Option Termination Date
	(i) By the Company for Cause, or what would have been Cause if the Company had known all of the relevant facts.	 	Termination of the Participant’s Continuous Service, or when Cause first existed if earlier.
	(ii) Disability of the Participant.	 	Within one year after termination of the Participant’s Continuous Service.
	(iii) Retirement of the Participant after age 60 with 5 years or more of Continuous Service.	 	Within six months after termination of the Participant’s Continuous Service.
	(iv) Death of the Participant during Continuous Service or within 90 days thereafter.	 	Within one year after termination of the Participant’s Continuous Service.
	(v) Other than due to Cause or the Participant’s Disability, Retirement, or Death.	 	Within 90 days after termination of the Participant’s Continuous Service.


 


Notwithstanding the foregoing, in no event may any Option be
exercised after the expiration of the Option term as set forth in the Award Agreement. To the extent that a Participant is not
entitled to exercise an Option at the date of his or her termination of Continuous Service, or if the Participant (or other person
entitled to exercise the Option) does not exercise the Option to the extent so entitled within the time specified in the Award
Agreement or above (as applicable), the Option shall terminate and the Shares underlying the unexercised portion of the Option
shall revert to the Plan and become available for future Awards.


 




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(e)          Buyout.
If a Participant so elects, the Committee may cancel an Option in exchange for a payment to a Participant in cash, cash equivalents,
new Awards, or Shares, at such time and on such terms and conditions as the Committee shall have established and communicated to
the Participant; provided, however, that, except in connection with a Change in Control, the per Share exercise price of any Option
cancelled pursuant to this Section 5(e) (as adjusted pursuant to Section 13 below) shall not be greater than the Fair
Market Value of a Share on such date unless the terms of the cancellation of such Option are approved by the shareholders of the
Company. In addition, but subject to Section 4(c) above and to any shareholder approval requirement of Applicable Law, if
the Fair Market Value for Shares subject to an Option is more than 33% below their exercise price for more than 30 consecutive
business days, the Committee may unilaterally terminate and cancel the Option by providing each affected Participant with either
cash or a new Award that has (i) a value equal to that of the vested portion of the Option being cancelled (with value being
uniformly determined as of the buyout date in accordance with the methodology that the Company generally uses for financial accounting
purposes for its Awards), (ii) vesting terms not less favorable to the Participant than the Option being cancelled, and (iii) any
other terms and conditions that the Committee may set forth in the Award Agreement for the new Award; subject, except in connection
with a Change in Control, to shareholder approval of any Awards or program involving the cancellation of Options in exchange for
Option grants having a lower exercise price.


 


(f)          Special
ISO Provisions. The following provisions shall control any grants of Options that are denominated as ISOs.


 


(i)          Grants
of ISOs. The Committee may grant ISOs only to Employees (including officers who are Employees) of the Company or an Affiliate
that is a “parent corporation” or “subsidiary corporation” within the meaning of Section 424 of the
Code. Each Option that is intended to be an ISO must be designated in the Award Agreement as an ISO, provided that any Option designated
as an ISO will be a Non-ISO to the extent the Option fails to meet the requirements of Code Section 422. In the case of an
ISO, the Committee shall determine the acceptable methods of payment on the Date of Grant and it shall be included in the applicable
Award Agreement.


 


(ii)         Maximum
Limit. The number of Shares that are available for ISO Awards shall not exceed 3,210,133 Shares (as adjusted pursuant to Section
13 of the Plan), and shall be determined, to the extent required under the Code, by reducing the number of Shares designated in
Section 3 of the Plan by the number of Shares issued pursuant to Awards, provided that any Shares that are subject to Awards issued
under the Plan and forfeited back to the Plan before an issuance of Shares shall be available for issuance pursuant to future ISO
Awards.


 


(iii)        $100,000
Limit. To the extent that the aggregate Fair Market Value of Shares with respect to which Options designated as ISOs first
become exercisable by a Participant in any calendar year (under this Plan and any other plan of the Company or any Affiliate) exceeds
U.S. $100,000, such excess Options shall be treated as Non-ISOs. For purposes of determining whether the U.S. $100,000 limit is
exceeded, the Fair Market Value of the Shares subject to an ISO shall be determined as of the Grant Date. In reducing the number
of Options treated as ISOs to meet the U.S. $100,000 limit, the most recently granted Options shall be reduced first. In the event
that Section 422 of the Code is amended to alter the limitation set forth therein, the limitation of this paragraph shall
be automatically adjusted accordingly.


 


(iv)        Grants
to 10% Holders. In the case of an Incentive Stock Option granted to an Employee who is a Ten Percent Holder on the Grant Date,
the term of the Incentive Stock Option shall not exceed five years from the Grant Date, and the exercise price shall be at least
110% of the Fair Market Value of the underlying Shares on the Grant Date. In the event that Section 422 of the Code is amended
to alter the limitations set forth therein, the limitation of this paragraph shall be automatically adjusted accordingly.


 


(v)         Substitution
of Options. Notwithstanding any other provisions of the Plan, in the event the Company or an Affiliate acquires (whether by
purchase, merger or otherwise) all or substantially all of outstanding capital stock or assets of another corporation or in the
event of any reorganization or other transaction qualifying under Code Section 424, the Committee may, in accordance with
the provisions of that Section, substitute ISOs for ISOs under the plan of the acquired company provided (i) the excess of
the aggregate Fair Market Value of the Shares subject to an ISO immediately after the substitution over the aggregate exercise
price of such shares is not more than the similar excess immediately before such substitution, and (ii) the new ISO does not
give additional benefits to the Participant, including any extension of the exercise period.


 




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(vi)        Notice
of Disqualifying Dispositions. By executing an ISO Award Agreement, each Participant agrees to notify the Company in writing
immediately after the Participant sells, transfers or otherwise disposes of any Shares acquired through exercise of the ISO, if
such disposition occurs within the earlier of (i) two years of the Grant Date, or (ii) one year after the exercise of
the ISO being exercised. Each Participant further agrees to provide any information about a disposition of Shares as may be requested
by the Company to assist it in complying with any applicable tax laws.


 


6.          SARs.


 


(a)          Grants.
The Committee may grant SARs to Eligible Persons pursuant to Award Agreements setting forth terms and conditions that are not inconsistent
with the Plan; provided that:


 


(i)          the
exercise price for the Shares subject to each SAR shall not be less than 100% of the Fair Market Value of the underlying Shares
on the Grant Date;


 


(ii)         no
SAR shall be exercisable for a term ending more than ten years after its Grant Date; and


 


(iii)        each
SAR shall, except to the extent a SAR Award Agreement provides otherwise, be subject to the provisions of Section 5(d) relating
to the effect of a termination of Participant’s Continuous Service and Section 5(e) relating to buyouts, in each case
with “SAR” being substituted for “Option.”


 


(b)          Settlement.
Subject to Section 14 below, a SAR shall entitle the Participant, upon exercise of the SAR, to receive Shares having a Fair
Market Value on the date of exercise equal to the product of the number of Shares as to which the SAR is being exercised, and the
excess of (i) the Fair Market Value, on such date, of the Shares covered by the exercised SAR, over (ii) an exercise
price designated in the SAR Award Agreement. Notwithstanding the foregoing, a SAR Award Agreement may limit the total settlement
value that the Participant will be entitled to receive upon the SAR’s exercise, and may provide for settlement either in
cash or in any combination of cash or Shares that the Committee may authorize pursuant to an Award Agreement. An Award Agreement
for a SAR may provide that, if, on the date upon which such SAR or any portion thereof is to expire, the Fair Market Value exceeds
the per Share exercise price of such SAR and if such SAR or portion thereof that will expire is otherwise exercisable, the SAR
shall be automatically exercised and settled pursuant to this Section 6(b).


 


(c)          SARs
related to Options. The Committee may grant SARs either concurrently with the grant of an Option or with respect to an outstanding
Option, in which case the SAR shall extend to all or a portion of the Shares covered by the related Option and have an exercise
price not less than the exercise price of the related Option. A SAR related to an Option shall entitle the Participant who holds
the related Option, upon exercise of the SAR and surrender of the related Option, or portion thereof, to the extent the SAR and
related Option each were previously unexercised, to receive payment of an amount determined pursuant to Section 6(b) above.
Any SAR granted in tandem with an ISO will contain such terms as may be required to comply with the provisions of Code Section 422.


 


7.          Restricted
Shares, RSUs, and Unrestricted Share Awards.


 


(a)          Grant.
The Committee may grant Restricted Share, RSU, or Unrestricted Share Awards to Eligible Persons, in all cases pursuant to Award
Agreements setting forth terms and conditions that are not inconsistent with the Plan. The Committee shall establish as to each
Restricted Share or RSU Award the number of Shares deliverable or subject to the Award (which number may be determined by a written
formula), and the period or periods of time (the “Restriction Period”) at the end of which all or some restrictions
specified in the Award Agreement shall lapse and the Participant shall receive unrestricted Shares (or cash to the extent provided
in the Award Agreement) in settlement of the Award. Such restrictions may include, without limitation, restrictions concerning
voting rights and transferability and such restrictions may lapse separately or in combination at such times and pursuant to such
circumstances or based on such criteria as selected by the Committee, including, without limitation, criteria based on the Participant’s
duration of employment, directorship or consultancy with the Company, individual, group, or divisional performance criteria, Company
performance, or other criteria selection by the Committee. The Committee may make Restricted Share and RSU Awards with or without
the requirement for payment of cash or other consideration. In addition, the Committee may grant Awards hereunder in the form of
Unrestricted Shares which shall vest in full upon the Grant Date or such other date as the Committee may determine or which the
Committee may issue pursuant to any program under which one or more Eligible Persons (selected by the Committee in its sole discretion)
elect to pay for such Shares or to receive Unrestricted Shares in lieu of cash bonuses that would otherwise be paid.


 




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(b)          Vesting
and Forfeiture. The Committee shall set forth in an Award Agreement granting Restricted Shares or RSUs, the terms and conditions
under which the Participant’s interest in the Restricted Shares or the Shares subject to RSUs will become vested and non-forfeitable.
Except as set forth in the applicable Award Agreement or the Committee otherwise determines, upon termination of a Participant’s
Continuous Service for any reason, the Participant shall forfeit his or her Restricted Shares and RSUs to the extent the Participant’s
interest therein has not vested on or before such termination date; provided that if a Participant purchases Restricted Shares
and forfeits them for any reason, the Company shall return the purchase price to the Participant to the extent either set forth
in an Award Agreement or required by Applicable Laws.


 


(c)          Certificates
for Restricted Shares. Unless otherwise provided in an Award Agreement, the Company shall hold certificates representing Restricted
Shares and, if applicable, dividends (whether in Shares or cash) that accrue with respect to them until the restrictions lapse,
and the Participant shall provide the Company with appropriate stock powers endorsed in blank. The Participant’s failure
to provide such stock powers within ten days after a written request from the Company shall entitle the Committee to unilaterally
declare a forfeiture of all or some of the Participant’s Restricted Shares.


 


(d)          Issuance
of Shares upon Vesting. As soon as practicable after vesting of a Participant’s Restricted Shares (or of the right to
receive Shares underlying RSUs), the Company shall deliver to the Participant, free from vesting restrictions, one Share for each
surrendered and vested Restricted Share (or deliver one Share free of the vesting restriction for each vested RSU), unless an Award
Agreement provides otherwise and subject to Section 10 below regarding Withholding Taxes. No fractional Shares shall be distributed,
and cash shall be paid in lieu thereof.


 


(e)          Dividends
Payable on Vesting. If provided in an Award Agreement, whenever Shares are deliverable to a Participant (or duly-authorized
transferee) pursuant to Section 7(d) above as a result of the vesting of a Restricted Share or RSU Award, the Participant
or his or her duly authorized transferee shall also be entitled to receive, with respect to each Share then vesting, a number of
Shares equal to the sum of –


 


(i)          any
per-Share dividends which were declared and paid in Shares to the Company’s shareholders of record between the Grant Date
and the date Shares are delivered to the Participant pursuant to the particular vesting event for the Award; and


 


(ii)         the
Shares that the Participant could have purchased at their Fair Market Value on the payment date of any cash dividends if the Participant
had received such cash dividends with respect to each Restricted Share, or Share subject to an RSU, between the Grant Date and
the date Shares are delivered to the Participant pursuant to the particular vesting event for the Award.


 


(f)          Deferral
Elections for RSUs. To the extent specifically provided in an Award Agreement, a Participant may irrevocably elect, in accordance
with Section 8 below, to defer the receipt of all or a percentage of the Shares that would otherwise be transferred to the
Participant upon the vesting of an RSU Award. If the Participant makes this election: (i) the Company shall credit the Shares
subject to the election, and, if applicable, any associated dividends, to a DSU account established pursuant to Section 8
below on the date such Shares and, if applicable, any associated dividends would otherwise have been delivered to the Participant
pursuant to Sections 7(d) and 7(e) above, and (ii) any vesting that would have occurred within the 12-month period following
the date of the Participant’s election shall occur on the 12-month anniversary of such election, provided that vesting may
occur immediately upon the Participant’s death or Disability if so provided in the Award Agreement.


 


(g)          Section
83(b) Elections. To the extent expressly permitted by an Award Agreement or the Committee, a Participant may make an election
under Code Section 83(b) (the “Section 83(b) Election”) with respect to Restricted Shares. A Participant
who has received RSUs may, within ten days after receiving the RSU Award, provide the Committee with a written notice of his or
her desire to make Section 83(b) Election with respect to the Shares subject to such RSUs. The Committee may in its discretion
convert the Participant’s RSUs into Restricted Shares, on a one-for-one basis, in full satisfaction of the Participant’s
RSU Award. The Participant may then make a Section 83(b) Election with respect to those Restricted Shares; provided that the
Participant’s Section 83(b) Election will be invalid if not filed with the Company and the appropriate U.S. tax authorities
within 30 days after the Grant Date of the RSUs replaced by the Restricted Shares.


 




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8.          DSUs.


 


(a)          Grants
of DSUs. The Committee may make DSU awards to any Eligible Persons pursuant to Award Agreements, regardless of whether or not
there is a deferral of compensation, and may permit select Eligible Persons to irrevocably elect, on a form provided by and acceptable
to the Committee (the “Election Form”), to forego the receipt of cash or other compensation (including the Shares deliverable
pursuant to any RSU Award) and in lieu thereof to have the Company credit to an internal Plan account a number of DSUs having a
Fair Market Value equal to the Shares and other compensation deferred. These credits will be made at the end of each calendar quarter
(or other period determined by the Committee) during which compensation is deferred. Unless the Company sends an Eligible Person
a written notice rejecting an Election Form within five business days after the Company receives it, an Election Form shall take
effect on the first day of the next calendar year (or on the first day of the next calendar month in the case of an initial election
within 30 days after a Participant becomes first eligible to defer hereunder) after its delivery to the Company. Notwithstanding
the foregoing sentence, a Participant’s Election Form will be ineffective with respect to any compensation that the Participant
earns before the date on which the Election Form takes effect. For any Participant who is subject to U.S. income taxation, the
Committee shall only authorize deferral elections pursuant to Section 8: (i) under written procedures, and using written
election forms, that satisfy the requirements of Code Section 409A, and (ii) shall only be made by Eligible Persons who
are Directors, Consultants, or members of a select group of management or highly compensated Employees (within the meaning of the
Code).


 


(b)          Vesting.
Unless an Award Agreement expressly provides otherwise, each Participant shall be 100% vested at all times in any Shares subject
to DSUs.


 


(c)          Issuances
of Shares. Unless an Award Agreement or the Committee expressly provides otherwise, the Company shall settle a Participant’s
DSU Award, by delivering one Share for each DSU, in five substantially equal annual installments that are issued before the last
day of each of the five calendar years that end after the date on which the Participant’s Continuous Service ends for any
reason, subject to –


 


(i)          the
Participant’s right to elect a different form of distribution, only on a form provided by and acceptable to the Committee,
that permits the Participant to select any combination of a lump sum and annual installments that are triggered by, and completed
within ten years following, the last day of the Participant’s Continuous Service; and


 


(ii)         the
Company’s acceptance of the Participant’s distribution election form executed at the time the Participant elects to
defer the receipt of Shares or other compensation pursuant to Section 8(a), provided that the Participant may change a distribution
election through any subsequent election that (I) the Participant delivers to the Company at least one year before the date
on which distributions are otherwise scheduled to commence pursuant to the Participant’s initial distribution election, and
(II) defers the commencement of distributions by at least five years from the originally scheduled distribution commencement
date.


 


Fractional shares shall not be issued, and instead shall be
paid out in cash.


 


(d)          Dividends.
If provided in an Award Agreement, whenever Shares are issued to a Participant pursuant to Section 9(c) above, the Participant
shall also be entitled to receive, with respect to each Share issued, a number of Shares determined in a manner consistent with
Section 7(e) above (but by reference to the period from the Grant Date of the DSU to its settlement through the issuance of
Shares to the Participant).


 




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(e)          Emergency
Withdrawals. In the event that a Participant suffers an unforeseeable emergency within the contemplation of this Section, the
Participant may apply to the Committee for an immediate distribution of all or a portion of the Participant’s DSUs. The unforeseeable
emergency must result from a sudden and unexpected illness or accident of the Participant, the Participant’s spouse, or a
dependent of the Participant, casualty loss of the Participant’s property, or other similar extraordinary and unforeseeable
conditions beyond the control of the Participant. The Committee shall, in its sole and absolute discretion, determine whether a
Participant has a qualifying unforeseeable emergency, may require independent verification of the emergency, and may determine
whether or not to provide the Participant with cash or Shares. The amount of any distribution hereunder shall be limited to the
amount necessary to relieve the Participant’s unforeseeable emergency plus amounts necessary to pay taxes reasonably anticipated
as a result of the distribution. The number of Shares subject to the Participant’s DSU Award shall be reduced by any Shares
distributed to the Participant and by a number of Shares having a Fair Market Value on the date of the distribution equal to any
cash paid to the Participant pursuant to this Section. For all DSUs granted to Participants who are U.S. taxpayers, the term “unforeseeable
emergency” shall be interpreted in accordance with Section 409A of the Code, and the term “dependent” shall
be interpreted in accordance with Section 152(a) of the Code.


 


(f)          Unsecured
Rights to Deferred Compensation. A Participant’s right to DSUs shall at all times constitute an unsecured promise of
the Company to pay benefits as they come due. The right of the Participant (or the Participant’s duly-authorized transferee)
to receive benefits hereunder shall be solely an unsecured claim against the general assets of the Company. Neither the Participant
nor the Participant’s duly-authorized transferee shall have any claim against or rights in any specific assets, Shares, or
other funds of the Company.


 


(g)          Termination
of Service. For purposes of Section 8 of the Plan, a Participant’s “Continuous Service” shall only end
when the Participant incurs a “separation from service” within the meaning of Treasury Regulations §1.409A-1(h).
A Participant shall be considered to have experienced a termination of Continuous Service when the facts and circumstances indicate
that either (i) no further services will be performed for the Company or any Affiliate after a certain date, or (ii) that
the level of bona fide services the Participant will perform after such date (whether as an Employee, Director, or Consultant)
are reasonably expected to permanently decrease to no more than 25% of the average level of bona fide services performed by such
Participant (whether as an Employee, Director, or Consultant) over the immediately preceding 36-month period (or full period of
services to the Company and its Affiliates if the Participant has been providing such services for less than 36 months).


 


9.          Performance
Awards.


 


(a)          Performance
Awards. Subject to the limitations set forth in paragraph (b) hereof, the Committee may in its discretion grant Performance
Awards, including Performance Units, to any Eligible Person that (i) have substantially the same financial benefits and other
terms and conditions as Options, SARs, RSUs, or DSUs, and/or (ii) are settled only in cash. A Performance Award is an Award
which is based on the achievement of specific goals with respect to the Company or any Affiliate or the individual performance
of the Participant, or any combination thereof, over a specified period of time. All Performance Awards shall be made pursuant
to Award Agreements setting forth terms and conditions that are not inconsistent with the Plan.


 


(b)          Deferral
Elections. At any time prior to the date that is both at least six months before the close of a Performance Period (or shorter
or longer period that the Committee selects) with respect to a Performance Award and at which time vesting or payment is substantially
uncertain to occur, the Committee may permit a Participant who is a member of a select group of management or highly compensated
employees to irrevocably elect, on a form provided by and acceptable to the Committee, to defer the receipt of all or a percentage
of the cash or Shares that would otherwise be transferred to the Participant upon the vesting of such Award. If the Participant
makes this election, the cash or Shares subject to the election, and, if applicable, any associated interest and dividends, shall
be credited to an account established pursuant to Section 8 hereof on the date such cash or Shares would otherwise have been
released or issued to the Participant pursuant to this Section.


 




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(c)          Performance
Compensation Awards. Subject to the limitations set forth in Section 9 and in this Appendix II.F., the Committee may,
at the time of grant of a Performance Unit, designate such Award as a “Performance Compensation Award” (payable
in cash or Shares) in order that such Award constitutes “qualified performance-based compensation” under Code Section 162(m),
in which event the Committee shall have the power to grant such Performance Compensation Award upon terms and conditions that qualify
it as “qualified performance-based compensation” within the meaning of U.S. Code Section 162(m). With respect
to each such Performance Compensation Award, the Committee shall establish, in writing within the time required under Code Section 162(m),
a “Performance Period ,” “Performance Measure(s)”, and “Performance Formula(e)”
(each such term being defined below). A Participant shall be eligible to receive payment in respect of a Performance Compensation
Award only to the extent that the Performance Measure(s) for such Award is achieved and the Performance Formula(e) as applied against
such Performance Measure(s) determines that all or some portion of such Participant’s Award has been earned for the Performance
Period. As soon as practicable after the close of each Performance Period, the Committee shall review and certify in writing whether,
and to what extent, the Performance Measure(s) for the Performance Period have been achieved and, if so, determine and certify
in writing the amount of the Performance Compensation Award to be paid to the Participant and, in so doing, may use negative discretion
to decrease, but not increase, the amount of the Award otherwise payable to the Participant based upon such performance.


 


(d)          Limitations
on Awards. The maximum Performance Award and the maximum Performance Compensation Award that any one Participant may earn in
any one Performance Period shall not together exceed the limitation set forth in Section 4(b) of the Plan for Shares subject
to Awards (or, for Performance Units to be settled in cash, U.S. $6,000,000).


 


(e)          Definitions.


 


(i)          “Performance
Formula” means, for a Performance Period, one or more objective formulas or standards established by the Committee for purposes
of determining whether or the extent to which an Award has been earned based on the level of performance attained or to be attained
with respect to one or more Performance Measure(s). Performance Formulae may vary from Performance Period to Performance Period
and from Participant to Participant and may be established on a stand-alone basis, in tandem or in the alternative.


 


(ii)         “Performance
Measure” means one or more of the following selected by the Committee to measure Company, Affiliate, and/or business unit
performance for a Performance Period, whether in absolute or relative terms (including, without limitation, terms relative to a
peer group or index):


 


	cash flow (before or after dividends)	earnings per share (including, without limitation, earnings before interest, taxes, depreciation and amortization)
	stock price	return on equity
	stockholder return or total stockholder return	return on capital (including without limitation return on total capital or return on invested capital)
	return on investment	return on assets or net assets
	market capitalization	economic value added
	debt leverage (debt to capital)	Revenue
	sales or net sales	Backlog
	income, pre-tax income or net income	operating income or pre-tax profit
	operating profit, net operating profit or economic profit	gross margin, operating margin or profit margin
	return on operating revenue or return on operating assets	cash from operations
	operating ratio	operating revenue
	market share improvement	general and administrative expenses
	customer service	new production introductions
	product line enhancements	strategic mergers or acquisitions
	working capital	Research
	licensing	Litigation
	human resources	information services
	sales of assets of Affiliates or business units	 


 




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Each such measure shall be, to the extent applicable, determined
in accordance with generally accepted accounting principles as consistently applied by the Company (or such other standard applied
by the Committee) and, if so determined by the Committee, and in the case of a Performance Compensation Award, to the extent permitted
under Code Section 162(m), adjusted to omit the effects of extraordinary items, gain or loss on the disposal of a business
segment, unusual or infrequently occurring events and transactions and cumulative effects of changes in accounting principles.
Performance Measures may vary from Performance Period to Performance Period and from Participant to Participant, and may be established
on a stand-alone basis, in tandem or in the alternative.


 


(iii)        “Performance
Period” means one or more periods of time (of not less than one fiscal year of the Company), as the Committee may designate,
over which the attainment of one or more Performance Measure(s) will be measured for the purpose of determining a Participant’s
rights in respect of an Award.


 


10.         Taxes;
Withholding.


 


(a)          General.
As a condition to the issuance or distribution of Shares pursuant to the Plan, the Participant (or in the case of the Participant’s
death, the person who succeeds to the Participant’s rights) shall make such arrangements as the Company may require for the
satisfaction of any applicable federal, state, local or foreign withholding tax obligations that may arise in connection with the
Award and the issuance of Shares. The Company shall not be required to issue any Shares until such obligations are satisfied. If
the Committee allows the withholding or surrender of Shares to satisfy a Participant’s tax withholding obligations, the Committee
shall not allow Shares to be withheld in an amount that exceeds the minimum statutory withholding rates for applicable tax purposes,
including payroll taxes.


 


(b)          Surrender
of Shares. If permitted by the terms of an Award Agreement or the Committee, in its discretion, a Participant may satisfy the
minimum statutory tax withholding and employment tax obligations associated with an Award by surrendering Shares to the Company
(including Shares that would otherwise be issued pursuant to the Award) that have a Fair Market Value determined as of the date
that the amount of tax to be withheld is to be determined under Applicable Law.


 


(c)          Income
Taxes and Deferred Compensation. Participants are solely responsible and liable for the satisfaction of any federal state,
province, or local taxes that may arise in connection with Awards (including, for Participants subject to taxation in the United
States, any taxes arising under Section 409A of the Code, except to the extent otherwise specifically provided in a written
agreement with the Company). Neither the Company nor any of its employees, officers, directors, or service providers shall have
any obligation whatsoever to pay such taxes, to prevent Participants from incurring them, or to mitigate or protect Participants
from any such tax liabilities. In the absence of any other arrangement, an Employee shall be deemed to have directed the Company
to withhold or collect from his or her cash compensation an amount sufficient to satisfy such tax obligations from the next payroll
payment or payments otherwise payable after the date of the exercise of an Award.


 


To the extent that the committee determines that any Award granted
under the Plan is subject to Section 409A of the Code, the Award Agreement evidencing such Award shall incorporate the terms
and conditions required by Section 409A of the Code. To the extent applicable, the Plan and 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 after the Effective Date. Notwithstanding
any provision of the Plan to the contrary, in the event that following the effective date of the committee determines that any
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 Committee may adopt such amendments to the Plan and the applicable
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 (a) exempt the Award from Section 409A
of the Code and/or preserve the intended tax treatment of the benefits provided with respect to the Award, or (b) comply with
the requirements of Section 409A of the Code and related Department of Treasury guidance and thereby avoid the application
of any penalty taxes under such Section.


 


The Plan is intended to be an “unfunded” plan for
incentive compensation. With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the
Plan or any Award Agreement shall give the Participant any rights that are greater than those of a general creditor of the Company
or any Affiliate of the Company.


 




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11.         Non-Transferability
of Awards.


 


(a)          General.
Except as set forth in this Section 11, Awards may not be sold, pledged, assigned, hypothecated, transferred or disposed of
in any manner other than by will or by the laws of descent or distribution. The designation of a death beneficiary by a Participant
will not constitute a transfer. An Award may be exercised, during the lifetime of the holder of an Award, only by such holder,
the duly-authorized legal representative of a Participant who is Disabled, or a transferee permitted by this Section 11.


 


(b)          Limited
Transferability Rights. Notwithstanding anything else in this Section 11, the Committee may in its discretion provide
that an Award may be transferred, on such terms and conditions as the Committee deems appropriate, either (i) by instrument
to the Participant’s “Immediate Family” (as defined below), (ii) by instrument to an inter vivos or testamentary
trust (or other entity) in which the Award is to be passed to the Participant’s designated beneficiaries, or (iii) by
gift to charitable institutions. Any transferee of the Participant’s rights shall succeed and be subject to all of the terms
of this Award Agreement and the Plan. “Immediate Family” means any child, stepchild, grandchild, parent, stepparent,
grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law,
or sister-in-law, and shall include adoptive relationships.


 


(c)          Death.
In the event of the death of a Participant, any outstanding Awards issued to the Participant shall automatically be transferred
to the Participant’s Beneficiary (or, if no Beneficiary is designated or surviving, to the person or persons to whom the
Participant’s rights under the Award pass by will or the laws of descent and distribution).


 


12.         Modification
of Awards and Substitution of Options. Within the limitations of the Plan, the Committee may modify an Award to accelerate
the rate at which an Option or SAR may be exercised (including without limitation permitting an Option or SAR to be exercised in
full without regard to the installment or vesting provisions of the applicable Award Agreement or whether the Option or SAR is
at the time exercisable, to the extent it has not previously been exercised), to accelerate the vesting of any Award, to extend
or renew outstanding Awards, to accept the cancellation of outstanding Awards to the extent not previously exercised, or to make
any other changes that would be allowed under the Plan for a new Award. However, except in connection with a Change in Control
or as approved by the shareholders of the Company, the Committee may not cancel an outstanding Option or SAR whose exercise price
per Share is greater than Fair Market Value at the time of cancellation for the purpose of reissuing the Option or SAR to the Participant
at a lower exercise price, granting a replacement award of a different type, or exchanging the Award for a cash payment, or otherwise
allow for a “repricing” of Options or SARs within the meaning of federal securities laws applicable to proxy statement
disclosures. Notwithstanding the foregoing provision, no modification of an outstanding Award shall materially and adversely affect
a Participant’s rights thereunder unless either (i) the Participant provides written consent, or (ii) before a
Change in Control, the Committee determines in good faith that the modification is not materially adverse to the Participant.


 


13.         Change
in Capital Structure; Change in Control; Etc.


 


(a)          Changes
in Capitalization. In the event of a Share dividend, Share split, or combination of Shares, Share exchange, recapitalization,
merger in which the Company is the surviving corporation, spin-off or split-off of an Affiliate, extraordinary cash dividend or
other change in the Company’s capital stock (including, but not limited to, the creation or issuance to shareholders generally
of rights, options or warrants for the purchase of capital stock of the Company), the number and kind of Shares or securities of
the Company to be subject to the Plan and to Awards then outstanding or to be granted, any and all maximum limits on the number
of Shares that may be delivered under the Plan, any exercise price for Awards, and other relevant provisions shall be equitably
adjusted by the Committee.


 


(b)          Change
in Control. In the event of a Change in Control but subject to the terms of any Award Agreements or any employment or other
similar agreement between the Company or any of its Affiliates and a Participant then in effect, each outstanding Award shall be
assumed or a substantially equivalent award shall be substituted by the surviving or successor corporation or a parent or subsidiary
of such surviving or successor corporation (the “Successor Corporation”) upon the consummation of the transaction;
provided, however, that to the extent outstanding Awards are neither being assumed nor replaced with substantially equivalent Awards
by the Successor Corporation, the Committee may in its sole and absolute discretion and authority, without obtaining the approval
or consent of the Company’s shareholders or any Participant with respect to his or her outstanding Awards, take one or more
of the following actions (with respect to any or all of the Awards, and with discretion to differentiate between individual Participants
and Awards for any reason):


 




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(i)          accelerate
the vesting of Awards so that Awards shall vest (and, to the extent applicable, become exercisable) as to the Shares that otherwise
would have been unvested and provide that repurchase rights of the Company with respect to Shares issued pursuant to an Award shall
lapse as to the Shares subject to such repurchase right;


 


(ii)         arrange
or otherwise provide for the payment of cash or other consideration to Participants in exchange for the satisfaction and cancellation
of outstanding Awards (with the Committee determining the amount payable to each Participant based on the Fair Market Value, on
the date of the Change in Control, of the Award being cancelled, based on any reasonable valuation method selected by the Committee);
or


 


(iii)        terminate
all or some Awards upon the consummation of the transaction, provided that the Committee shall provide for vesting of such Awards
in full as of a date immediately prior to consummation of the Change in Control. To the extent that an Award is not exercised prior
to consummation of a transaction in which the Award is not being assumed or substituted, such Award shall terminate upon such consummation.


 


Notwithstanding the above and unless otherwise provided in an
Award Agreement or in any employment or other similar agreement between the Company or any of its Affiliates and a Participant
then in effect, in the event a Participant is Involuntarily Terminated on or within 12 months (or other period either set forth
in an Award Agreement) following a Change in Control, then any Award that is assumed or substituted pursuant to this Section 13(b)
shall accelerate and become fully vested (and become exercisable in full in the case of Options and SARs), and any repurchase right
applicable to any Shares shall lapse in full, unless an Award Agreement provides for a more restrictive acceleration or vesting
schedule or more restrictive limitations on the lapse of repurchase rights or otherwise places additional restrictions, limitations
and conditions on an Award. The acceleration of vesting and lapse of repurchase rights provided for in the previous sentence shall
occur immediately prior to the effective date of the Participant’s Involuntary Termination, unless an Award Agreement provides
otherwise.


 


(c)          Dissolution
or Liquidation. In the event of the dissolution or liquidation of the Company other than as part of a Change in Control, each
Award will terminate immediately prior to the consummation of such action, subject to the ability of the Committee to exercise
any discretion authorized in the case of a Change in Control.


 


14.         Laws
and Regulations.


 


(a)          General
Rules. This Plan, the grant of Awards, the exercise of Options and SARs, and the obligations of the Company hereunder (including
those to pay cash or to deliver, sell or accept the surrender of any of its Shares or other securities) shall be subject to all
Applicable Laws. In the event that any Shares are not registered under any Applicable Law prior to the required delivery of them
pursuant to Awards, the Company may require, as a condition to their issuance or delivery, that the persons to whom the Shares
are to be issued or delivered make any written representations and warranties (such as that such Shares are being acquired by the
Participant for investment for the Participant’s own account and not with a view to, for resale in connection with, or with
an intent of participating directly or indirectly in, any distribution of such Shares) that the Committee may reasonably require,
and the Committee may in its sole discretion include a legend to such effect on the certificates representing any Shares issued
or delivered pursuant to the Plan.


 


(b)          Black-out
Periods. Notwithstanding any contrary terms within the Plan or any Award Agreement, the Committee shall have the absolute discretion
to impose a “blackout” period on the exercise of any Option or SAR, as well as the settlement of any Award, with respect
to any or all Participants (including those whose Continuous Service has ended) to the extent that the Committee determines that
doing so is either desirable or required in order to comply with applicable securities laws, provided that, if any blackout period
occurs, the term of any Option or SAR shall not expire until the earlier of (i) 30 days after the blackout period ends or
(ii) the Option’s or SAR’s expiration date but only if within 30 days thereafter the Company makes a cash payment
to each affected Participant in an amount equal to the value of the Option or SAR (as determined by the Committee) immediately
before its expiration to the extent then vested and exercisable.


 




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(c)          No
Shareholder Rights. Neither a Participant nor any transferee of a Participant shall have any rights as a shareholder of the
Company with respect to any Shares underlying any Award until the date of issuance of a share certificate to a Participant or a
transferee of a Participant for such Shares in accordance with the Company’s governing instruments and Applicable Law. Unless
otherwise provided in an Award Agreement, prior to the issuance of Shares pursuant to an Award, a Participant shall not have the
right to vote or to receive dividends or any other rights as a shareholder with respect to the Shares underlying the Award, notwithstanding
its exercise in the case of Options and SARs. No adjustment will be made for a dividend or other right that is determined based
on a record date prior to the date the stock certificate is issued, except as otherwise specifically provided for in this Plan.


 


(d)          Local
Law Adjustments and Sub-plans. To facilitate the making of any grant of an Award under this Plan, the Committee may adopt rules
and provide for such special terms for Awards to Participants who are located within the United States, foreign nationals, or who
are employed by the Company or any Affiliate outside of the United States of America as the Committee may consider necessary or
appropriate to accommodate differences in local law, tax policy or custom. Without limiting the foregoing, the Company is specifically
authorized to adopt rules and procedures regarding the conversion of local currency, taxes, withholding procedures and handling
of stock certificates which vary with the customs and requirements of particular countries. The Company may adopt sub-plans and
establish escrow accounts and trusts, and settle Awards in cash in lieu of shares, as may be appropriate, required or applicable
to particular locations and countries.


 


15.         Termination,
Rescission and Recapture of Awards.


 


(a)          Each
Award under the Plan is intended to align the Participant’s long-term interests with those of the Company. Accordingly, to
the extent expressly provided in an Award Agreement, the Company may terminate any outstanding, unexercised, unexpired, unpaid,
or deferred Awards (“Termination”), rescind any exercise, payment or delivery pursuant to the Award (“Rescission”),
or recapture any Shares (whether restricted or unrestricted) or proceeds from the Participant’s sale of Shares issued pursuant
to an Award (“Recapture”), if the Participant, during his or her Continuous Service or within one year after
the termination of his or her Continuous Service, engages in activity which: (i) constitutes a material breach of the terms
of any applicable patent, proprietary information, confidentiality, non-disclosure, intellectual property, secrecy or other similar
agreement between the Participant and the Company or any of its Affiliates; (ii) constitutes the breach of the terms of any
non-solicitation, non-competition or similar agreement between the Participant and the Company or any of its Affiliates; or (iii) is
materially prejudicial to the interests of the Company and constitutes a breach of a fiduciary duty to the Company or its Affiliates.


 


(b)          Within
ten days after receiving notice from the Company of any such activity described in subclauses (i), (ii) or (iii) in Section 15(a)
above, the Participant shall deliver to the Company the Shares acquired pursuant to the Award, or, if Participant has sold the
Shares, the gain realized, or payment received as a result of the rescinded exercise, payment, or delivery; provided, that if the
Participant returns Shares that the Participant purchased pursuant to the exercise of an Option (or the gains realized from the
sale of such Shares), the Company shall promptly refund the exercise price, without interest, that the Participant paid for the
Shares. Any payment by the Participant to the Company pursuant to this Section shall be made either in cash or by returning to
the Company the number of Shares that the Participant received in connection with the rescinded exercise, payment, or delivery.


 


(c)          Notwithstanding
the foregoing provisions of this Section 15, the Company has sole and absolute discretion not to require Termination, Rescission
and/or Recapture, and its determination not to require Termination, Rescission and/or Recapture with respect to any particular
act by a particular Participant or particular Award shall not in any way reduce or eliminate the Company’s authority to require
Termination, Rescission and/or Recapture with respect to any other act or Participant or Award. Nothing in this Section shall be
construed to impose obligations on the Participant to refrain from engaging in lawful competition with the Company after the termination
of employment that does not violate subclauses (i), (ii) or (iii) of Section 15(a) above.


 




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(d)          All
administrative and discretionary authority given to the Company under this Section shall be exercised by such person or committee
(including without limitation the Committee) as the Committee may designate from time to time.


 


(e)          If
any provision within this Section 15 is determined to be unenforceable or invalid under any Applicable Law, such provision
will be applied to the maximum extent permitted by Applicable Law, and shall automatically be deemed amended in a manner consistent
with its objectives and any limitations required under Applicable Law. Notwithstanding the foregoing, but subject to any contrary
terms expressly set forth in any Award Agreement, this Section 15 shall not be applicable to any Participant from and after
his or her termination of Continuous Service after a Change in Control.


 


16.         Recoupment
of Awards. To the extent expressly provided in an Award Agreement, and to the extent permitted by Applicable Law, the Committee
may in its sole and absolute discretion, without obtaining the approval or consent of the Company’s shareholders or of any
Participant, require that a Participant reimburse the Company for all or any portion of any Awards granted to him or her under
this Plan (“Reimbursement”), or the Committee may require the Termination or Rescission of, or the Recapture associated
with, any Award, if and to the extent—


 


(a)          the
granting, vesting, or payment of such Award (or portion thereof) was predicated upon the achievement of certain financial results;


 


(b)          in
the Committee’s view the Participant engaged in fraud or misconduct that caused a calculation that later proves to be materially
inaccurate or partially caused the need for a material financial restatement by the Company or any Affiliate; and


 


(c)          a
lower granting, vesting, or payment of such Award would have occurred based upon the conduct described in clause (b) of this Section.


 


In each instance, the Committee may, to the extent practicable
and allowable under Applicable Laws, require Reimbursement, Termination or Rescission of, or Recapture relating to, any such Award
granted to a Participant.


 


17.         Administration
of the Plan. The Committee shall administer the Plan in accordance with its terms, provided that the Board may act in lieu
of the Committee on any matter. The Committee shall hold meetings at such times and places as it may determine and shall make such
rules and regulations for the conduct of its business as it deems advisable. In the absence of a duly appointed Committee, the
Board shall function as the Committee for all purposes of the Plan.


 


(a)          Committee
Composition. The Board shall appoint the members of the Committee. If and to the extent permitted by Applicable Law, the Committee
may authorize one or more executive officers to make Awards to Eligible Persons other than themselves. The Board may at any time
appoint additional members to the Committee, remove and replace members of the Committee with or without Cause, and fill vacancies
on the Committee however caused.


 


(b)          Powers
of the Committee. Subject to the provisions of the Plan, the Committee shall have the authority, in its sole discretion:


 


(i)          to
grant Awards and to determine Eligible Persons to whom Awards shall be granted from time to time, and the number of Shares, units,
or dollars to be covered by each Award;


 


(ii)         to
determine, from time to time, the Fair Market Value of Shares;


 


(iii)        to
determine, and to set forth in Award Agreements, the terms and conditions of all Awards, including any applicable exercise or purchase
price, the installments and conditions under which an Award shall become vested (which may be based on performance), terminated,
expired, cancelled, or replaced, and the circumstances for vesting acceleration or waiver of forfeiture restrictions, and other
restrictions and limitations;


 




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(iv)        to
approve the forms of Award Agreements and all other documents, notices and certificates in connection therewith which need not
be identical either as to type of Award or among Participants;


 


(v)         to
construe and interpret the terms of the Plan and any Award Agreement, to determine the meaning of their terms, and to prescribe,
amend, and rescind rules and procedures relating to the Plan and its administration;


 


(vi)        to
the extent consistent with the purposes of the Plan and without amending the Plan, to modify, to cancel, or to waive the Company’s
rights with respect to any Awards, to adjust or to modify Award Agreements for changes in Applicable Law, and to recognize differences
in foreign law, tax policies, or customs;


 


(vii)       in
the event that the Company establishes for itself, or uses the services of a third party to establish, an automated system for
the documentation, granting, settlement, or exercise of Award, such as a system using an internet website or interactive voice
response, to implement paperless documentation, granting, settlement, or exercise of Awards by a Participant may be permitted through
the use of such an automated system; and


 


(viii)      to
make all interpretations and to take all other actions that the Committee may consider necessary or advisable to administer the
Plan or to effectuate its purposes.


 


Subject to Applicable Law and the restrictions set forth in
the Plan, the Committee may delegate administrative functions to individuals who are Directors or Employees.


 


(c)          Action
by Committee. Each member of the Committee is entitled to, in good faith, rely or act upon any report or other information
furnished to that member by an officer or other employee of the Company or any Affiliate, the Company’s independent certified
public accounts, or any executive compensation consultant or other professional retained by the Company to assist in the administration
of the Plan.


 


(d)          Deference
to Committee Determinations. The Committee shall have the discretion to interpret or construe ambiguous, unclear, or implied
(but omitted) terms in any fashion it deems to be appropriate in its sole discretion, and to make any findings of fact needed in
the administration of the Plan or Award Agreements. The Committee’s prior exercise of its discretionary authority shall not
obligate it to exercise its authority in a like fashion thereafter. The Committee’s interpretation and construction of any
provision of the Plan, or of any Award or Award Agreement, and all determination the Committee makes pursuant to the Plan shall
be final, binding, and conclusive. The validity of any such interpretation, construction, decision or finding of fact shall not
be given de novo review if challenged in court, by arbitration, or in any other forum, and shall be upheld unless clearly made
in bad faith or materially affected by fraud.


 


(e)          No
Liability; Indemnification. Neither the Board nor any Committee member, nor any Person acting at the direction of the Board
or the Committee, shall be liable for any act, omission, interpretation, construction or determination made in good faith with
respect to administering or interpreting the Plan, any Award or any Award Agreement on behalf of the Company. The Company and its
Affiliates shall pay or reimburse any member of the Committee, as well as any Director, Employee, or Consultant who in good faith
takes action on behalf of the Plan, for all expenses incurred with respect to the Plan, and to the full extent allowable under
Applicable Law shall indemnify each and every one of them for any claims, liabilities, and costs (including reasonable attorney’s
fees) arising out of their good faith performance of duties on behalf of the Plan. The Company and its Affiliates may, but shall
not be required to, obtain liability insurance for this purpose.


 


18.         Governing
Law. The terms of this Plan shall be governed by the laws of the State of Delaware, without regard to its conflicts of
law rules.


 




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19.         Plan
Termination or Amendment.


 


If not sooner terminated by the Board, this Plan shall terminate
at the close of business on the date ten years after its effective date as determined under Section 1(a) above. No Awards
shall be made under the Plan after its termination. The Board may amend or terminate the Plan as it shall deem advisable; provided
that no change shall be made that increases the total number of Shares reserved for issuance pursuant to Awards granted under the
Plan (except pursuant to Section 13 above) unless such change is authorized by the shareholders of the Company. A termination
or amendment of the Plan shall not, without the consent of the Participant, adversely and materially affect a Participant’s
rights under an Award previously granted to him or her. Notwithstanding the foregoing, the Committee may amend the Plan to comply
with changes in tax or securities laws or regulations, or in the interpretation thereof. Furthermore, the Board may not amend the
Plan without shareholder approval to allow for either (i) a “repricing” within the meaning of federal securities
laws applicable to proxy statement disclosures, except a repricing in connection with a Change in Control or which is otherwise
approved by the shareholders, or (ii) the cancellation of an outstanding Option or SAR whose exercise price is greater than
Fair Market Value at the time of cancellation for the purpose of reissuing the Option or SAR to the Participant at a lower exercise
price, granting a replacement award of a different type or in exchange for a cash payment, except a cancellation and reissuance,
grant of a replacement award or cash payment in connection with a Change in Control.


 


20.         Relationship
to other Benefits. No payment pursuant to the Plan shall be taken into account in determining any benefits under any pension,
retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the Company or any Affiliate except to the
extent otherwise expressly provided in writing in such other plan or an agreement thereunder.


 


21.         Expenses.
The expenses of administering the Plan shall be borne by the Company and its Affiliates.


 




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B. RILEY FINANCIAL, INC.


Amended and Restated 2009 Stock Incentive
Plan


 


(formerly Great American Group, Inc.


Amended and Restated 2009 Stock Incentive
Plan)


 


(formerly Alternative
Asset Management Acquisition Corp.


2009 Stock Incentive Plan)


  


 






Appendix I: Definitions





 






 





As used in the Plan, the following terms have the meanings indicated
when they begin with initial capital letters within the Plan:


 


“Affiliate” means, with respect to
any Person, any other Person that directly or indirectly controls or is controlled by or under common control with such Person.
For the purposes of this definition, “control,” when used with respect to any Person, means the possession, direct
or indirect, of the power to direct or cause the direction of the management and policies of such Person or the power to elect
directors, whether through the ownership of voting securities, by contract or otherwise; and the terms “affiliated,”
“controlling” and “controlled” have meanings correlative to the foregoing.


 


“Applicable Law” means the legal requirements
relating to the administration of options and share-based plans under any applicable laws of the United States, any other country,
and any provincial, state, or local subdivision, any applicable stock exchange or automated quotation system rules or regulations,
as such laws, rules, regulations and requirements shall be in place from time to time.


 


“Award” means any award made pursuant
to the Plan, including awards made in the form of an Option, a SAR, a Restricted Share, a RSU, an Unrestricted Share, a DSU, or
a Performance Award, or any combination thereof, whether alternative or cumulative.


 


“Award Agreement” means any document,
whether in writing or through an electronic medium, setting forth the terms of an Award that has been authorized by the Committee.
The Committee shall determine the form or forms of documents to be used, and may change them from time to time for any reason,
including different documents as may be appropriate or applicable for particular locations and countries.


 


“Beneficiary” means the person or
entity designated by the Participant, in a form approved by the Company, to exercise the Participant’s rights with respect
to an Award or receive payment or settlement under an Award after the Participant’s death.


 


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


 


“Cause” will have the meaning set
forth in any employment agreement between the Company or any of its Affiliate and the Participant then in effect. In the absence
of such an agreement, “Cause” will exist if the Participant is terminated from employment or other service with the
Company or an Affiliate for any of the following reasons: (i) the Participant’s willful failure to substantially perform
his or her duties and responsibilities to the Company or deliberate violation of a material Company policy; (ii) the Participant’s
commission of any material act or acts of fraud, embezzlement, dishonesty, or other willful misconduct; (iii) the Participant’s
material unauthorized use or disclosure of any proprietary information or trade secrets of the Company or any other party to whom
the Participant owes an obligation of nondisclosure as a result of his or her relationship with the Company; or (iv) Participant’s
willful and material breach of any of his or her obligations under any written agreement or covenant with the Company. The foregoing
definition does not in any way limit the Company’s ability to terminate a Participant’s employment or consulting relationship
at any time, and the term “Company” will be interpreted herein to include any Affiliate or successor thereto, if appropriate.


 




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“Change in Control” shall be deemed
to have occurred if:


 


(i)          a
sale, transfer, or other disposition of all or substantially all of the assets and properties of the Company is closed or consummated;


 


(ii)         any
“person,” “entity” or “group” (within the meaning of Section 13(d)(3) and 14(d)(2)) of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), other than the Company or any majority owned
subsidiary of the Company, becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing fifty percent (50%) or more of the combined voting power of the Company’s
then outstanding securities that have the right to vote in the election of directors generally; provided, however, that the following
shall not constitute a “Change in Control” for purposes of this subclause (ii):


 


(A)         any
acquisition directly from the Company (excluding any acquisition resulting from the exercise of a conversion or exchange privilege
in respect of outstanding convertible or exchangeable securities); or


 


(B)         any
acquisition by an employee benefit plan (or related trust) sponsored or maintained by the Company or any entity controlled by the
Company;


 


(iii)        during
any period of two consecutive years during the term of the Plan, individuals who at the beginning of such period constitute the
Board of Directors of the Company cease for any reason to constitute at least a majority thereof, unless the election of each director
who was not a director at the beginning of such period has been approved in advance by directors representing at least two-thirds
of the directors then in office who were directors at the beginning of the period but excluding any director whose initial assumption
of office occurred as a result of an actual or threatened solicitation of proxies or consents by or on behalf of any Person other
than the Board of Directors of the Company; or


 


(iv)        the
shareholders of the Company approve a plan or proposal of liquidation of the Company, or a merger, reorganization, or consolidation
involving the Company is closed or consummated, other than a merger, reorganization, or consolidation in which holders of the combined
voting power of the Company’s then outstanding securities that have the right to vote in the election of directors generally
immediately prior to such transaction own, either directly or indirectly, fifty percent (50%) or more of the combined voting power
of the securities entitled to vote in the election of directors generally of the merged, reorganized or consolidated entity (or
its parent company) immediately following such transaction in substantially the same proportions among such holders as immediately
prior to such transaction.


 


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


 


“Committee” means one or more committees
or subcommittees of the Board appointed by the Board to administer the Plan in accordance with Section 17 above. With respect
to any decision involving an Award intended to satisfy the requirements of Section 162(m) of the Code, the Committee shall
consist of two or more Directors of the Company who are “outside directors” within the meaning of Section 162(m)
of the Code. With respect to any decision relating to a Reporting Person, the Committee shall consist of two or more directors
who are “non-employee directors” within the meaning of Rule 16b-3. Unless otherwise determined by the Board, the Committee
shall be the Compensation Committee of the Board or its successor.


 


“Company” means B. Riley Financial,
Inc., a Delaware corporation; provided, however, that in the event the Company reincorporates to another jurisdiction, all references
to the term “Company” shall refer to the Company in such new jurisdiction.


 


“Consultant” means any person (other
than an Employee or Director), including an advisor, who is engaged by the Company or any Affiliate to render services and is compensated
for such services.


 




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“Continuous Service” means a Participant’s
period of service in the absence of any interruption or termination, as an Employee, Director, or Consultant. Continuous Service
shall not be considered interrupted in the case of: (i) sick leave; (ii) military leave; (iii) any other leave of
absence approved by the Committee, provided that such leave is for a period of not more than 90 days, unless reemployment upon
the expiration of such leave is guaranteed by contract or statute, or unless provided otherwise pursuant to Company policy adopted
from time to time; (iv) changes in status from Director to advisory director or emeritus status; or (v) transfers between
locations of the Company or between the Company and its Affiliates. Changes in status between service as an Employee, Director,
and a Consultant will not constitute an interruption of Continuous Service if the individual continues to perform bona fide services
for the Company. The Committee shall have the discretion to determine whether and to what extent the vesting of any Awards shall
be tolled during any paid or unpaid leave of absence; provided, however, that in the absence of such determination, vesting for
all Awards shall be tolled during any such unpaid leave (but not for a paid leave).


 


“Deferred Share Units” or “DSUs”
mean Awards pursuant to Section 8 of the Plan.


 


“Director” means a member of the Board,
or a member of the board of directors of an Affiliate.


 


“Disabled” shall have the meaning
set forth in any employment agreement between the Company or any of its Affiliates and the Participant then in effect (and shall
include the term “Disability” if that term is so defined in such employment agreement). In the absence of such an agreement,
“Disabled” shall mean a condition under which a Participant —


 


(i)          is
unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which
can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or


 


(ii)         is,
by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected
to last for a continuous period of not less than 12 months, received income replacement benefits for a period of not less than
3 months under an accident or health plan covering employees of the Company or an Affiliate of the Company.


 


“Eligible Person” means any Consultant,
Director, or Employee and includes non-Employees to whom an offer of employment has been or is being extended.


 


“Employee” means any person whom the
Company or any Affiliate classifies as an employee (including an officer) for employment tax purposes, whether or not that classification
is correct. The payment by the Company of a director’s fee to a Director shall not be sufficient to constitute “employment”
of such Director by the Company.


 


“Employer” means the Company and each
Affiliate that employs one or more Participants.


 


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


 


“Fair Market Value” as of any date
(the “Determination Date”) means: (i) the closing price of a Share on the New York Stock Exchange, the American
Stock Exchange or the NASDAQ Global Select Market (collectively, the “Exchange”) on the Determination Date, or, if
shares were not traded on the Determination Date, then on the nearest preceding trading day during which a sale occurred; or (ii) if
such stock is not traded on the Exchange but is otherwise traded in the over-the-counter market, the mean between the representative
bid and asked prices for a Share on the Determination Date; or (iii) if subsections (i) or (ii) do not apply, the fair market
value of a Share established in good faith by the Board or the Committee based on relevant facts and circumstances.


 


“Grant Date” means the later of (i) the
date designated as the “Grant Date” within an Award Agreement, and (ii) date on which the Committee determines
the key terms of an Award, provided that as soon as reasonably practical thereafter the Committee both notifies the Eligible Person
of the Award and enters into an Award Agreement with the Eligible Person.


 




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“Incentive Stock Option” or “ISO”
means, an Option that qualifies for favorable income tax treatment under Code Section 422.


 


“Involuntary Termination” shall mean,
to the extent there is an employment agreement between the Company or any of its Affiliates and a Participant then in effect and
subject to the terms of such employment agreement, a termination of a Participant’s employment on or after a Change in Control
(i) by the Participant for “Good Reason” (as defined in any such employment agreement), or (ii) by the Company
or its Affiliates without cause or other than upon death or disability which termination entitles such Participant to accelerated
or extended severance benefits pursuant to his or her employment agreement. In the absence of such an agreement, “Involuntary
Termination” means a termination of a Participant’s Continuous Service under the following circumstances occurring
on or after a Change in Control: (i) termination without Cause by the Company or an Affiliate or successor thereto, as appropriate;
or (ii) voluntary termination by the Participant, if: (1) the Participant voluntarily terminates Continuous Service within
60 days of one of the following conditions arising without the Participant’s consent: (A) a material reduction in the
Participant’s job responsibilities, provided that neither a mere change in title alone nor reassignment to a substantially
similar position shall constitute a material reduction in job responsibilities; (B) an involuntary relocation of the Participant’s
work site to a facility or location more than 25 miles from the Participant’s principal work site at the time of the Change
in Control; or (C) a material reduction in Participant’s total compensation other than as part of an reduction by the
same percentage amount in the compensation of all other similarly-situated Employees or Directors; (2) the Participant gives
the Company or an Affiliate written notice of the existence of one or more of the conditions listed in (A) through (C) within ten
days of the initial existence of the condition; and (3) the Company or Affiliate fails to cure such condition within 30 days
following receipt of such written notice by the Participant.


 


“Non-ISO” means an Option not intended
to qualify as an Incentive Stock Option, as designated in the applicable Award Agreement.


 


“Option” means a right to purchase
Shares granted under the Plan, at a price determined in accordance with the Plan.


 


“Participant” means any Eligible Person
who holds an outstanding Award.


 


“Performance Awards” mean Awards granted
pursuant to Section 9.


 


“Performance Unit” means an Award
granted pursuant to Section 9(a) of the Plan which may be paid in cash, in Shares, or such combination of cash and Shares
as the Committee in its sole discretion shall determine.


 


“Person” means any natural person,
association, trust, business trust, cooperative, corporation, general partnership, joint venture, joint-stock company, limited
partnership, limited liability company, real estate investment trust, regulatory body, governmental agency or instrumentality,
unincorporated organization or organizational entity.


 


“Plan” means this B. Riley Financial,
Inc. Amended and Restated 2009 Stock Incentive Plan (including the Appendices hereto).


 


“Recapture” and “Rescission”
have the meaning set forth in Section 15 of the Plan.


 


“Reimbursement” has the meaning set
forth in Section 16 of the Plan.


 


“Reporting Person” means an Employee,
Director, or Consultant who is subject to the reporting requirements set forth under Rule 16b-3.


 


“Restricted Share” means a Share awarded
with restrictions imposed under Section 7.


 


“Restricted Share Unit” or “RSU”
means a right granted to a Participant to receive Shares or cash upon the lapse of restrictions imposed under Section 7.


 




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“Retirement” means a Participant’s
termination of employment after age 65.


 


“Rule 16b-3” means Rule 16b-3 promulgated
under the Exchange Act, as amended from time to time, or any successor provision.


 


“Share” means an ordinary share, no
par value, of the Company, as adjusted in accordance with Section 13 of the Plan.


 


“SAR” or “Share Appreciation
Right” means a right to receive amounts awarded under Section 6.


 


“Ten Percent Holder” means a person
who owns (within the meaning of Code Section 422) stock representing more than ten percent (10%) of the combined voting power
of all classes of stock of the Company.


 


“Unrestricted Shares” mean Shares
awarded without restrictions pursuant to Section 7 of the Plan.


 


“Withholding Taxes” means the aggregate
minimum amount of federal, state, local and foreign income, payroll and other taxes that the Company and any Affiliates are required
to withhold in connection with any Award.


 




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b.
riley financial, Inc.


Amended and Restated 2009 Stock Incentive
Plan


 


(formerly
Great American Group, Inc.


Amended and Restated 2009 Stock Incentive
Plan)


 


(formerly Alternative Asset Management
Acquisition Corp.


2009 Stock Incentive Plan)


 


The 2009 Stock Incentive Plan was approved by the Board of Directors
of Alternative Asset Management Acquisition Corp. (“AAMAC”) on May 12, 2009 and by the shareholders of Alternative
Asset Management Acquisition Corp. (“AAMAC”) on July 31, 2009, and assumed by Great American Group, Inc. on July 31,
2009 (the “2009 Plan”). The 2009 Plan was amended and restated by the Board of Directors of Great American Group, Inc.
on August 19, 2009 (the “August 2009 Plan”). The August 2009 Plan was amended and restated by the Board of Directors
and stockholders of Great American Group, Inc. on October 7, 2014 (the “2014 Plan”). The 2014 Plan was amended by the
Board of Directors of B. Riley Financial, Inc. on February 11, 2015 to reflect the change of the Company’s name from Great
American Group, Inc. to B. Riley Financial, Inc. The 2014 Plan was amended by the Board of Directors of B. Riley Financial, Inc.
on May 4, 2015 to provide the Committee with discretion to make payments in respect of dividends associated with Shares underlying
certain Awards.


 




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