Exhibit 4.2


 


MyDx, Inc.


2017 Stock Incentive Plan


 


ARTICLE I


PURPOSE AND ADOPTION OF THE PLAN


 


1.1          Purpose.
The purpose of the MyDx, Inc. 2017 Stock Incentive Plan (hereinafter referred to as the “Plan”) is to assist
in attracting and retaining highly competent key employees, non-employee directors and consultants and to act as an incentive in
motivating selected key employees, non-employee directors and consultants of MyDx, Inc. and its Subsidiaries (as defined below)
to achieve long-term corporate objectives.


 


1.2         Adoption
and Term. The Plan has been approved by the Board of Directors (hereinafter referred to as the “Board”)
of MyDx, Inc., a Nevada corporation (including any successor entity, the “Company”), to be effective as of the
date the Plan is approved by the Board (the “Effective Date”), subject to the approval of the stockholders of
the Company. The Plan shall remain in effect until terminated by action of the Board; provided, however, that no Incentive
Stock Option (as defined below) may be granted hereunder after the tenth anniversary of the Effective Date. The Company intends
that any grant, award or other acquisition of the Company’s securities pursuant to the Plan to any officer and/or director
of the Company shall be exempt from Section 16(b) of the Exchange Act.


 


ARTICLE II


DEFINITIONS


 


2.1         For
the purposes of this Plan, capitalized terms shall have the following meanings:


 


“Award” means
any grant to a Participant of one or a combination of Non-Qualified Stock Options or Incentive Stock Options, and Stock Appreciation
Rights, Restricted Shares and Performance Awards described herein.


 


“Award Agreement”
means a written agreement between the Company and a Participant or a written notice from the Company to a Participant specifically
setting forth the terms and conditions of an Award granted under the Plan.


 


“Award Period”
means, with respect to an Award, the period of time set forth in the Award Agreement during which specified target performance
goals must be achieved or other conditions set forth in the Award Agreement must be satisfied.


 


“Beneficiary”
means an individual, trust or estate who or which, by a written designation of the Participant filed with the Company or by operation
of law, succeeds to the rights and obligations of the Participant under the Plan and an Award Agreement upon the Participant’s
death.


 


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


 


“Change in Control”
means, and shall be deemed to have occurred upon the occurrence of, any one of the following events:


 


(a)       Consummation
by the Company of a reorganization, merger, consolidation or similar transaction (a “Reorganization Transaction”),
in each case, unless, immediately following such Reorganization Transaction, more than 50% of, respectively, the outstanding shares
of common stock (or similar equity security) of the corporation or other entity resulting from or surviving such Reorganization
Transaction and the combined voting power of the securities of such corporation or other entity entitled to vote generally in the
election of directors, is then beneficially owned, directly or indirectly, by the individuals and entities who were the respective
beneficial owners of the Outstanding Common Stock and the Company Voting Securities immediately prior to such Reorganization Transaction
in substantially the same proportions as their ownership of the Outstanding Common Stock and Company Voting Securities immediately
prior to such Reorganization Transaction; or


 






    


     

    

 


(b)       Consummation
by the Company of (i) a complete liquidation or dissolution of the Company or (ii) the sale or other disposition of all or substantially
all of the assets of the Company to a corporation or other entity, unless, with respect to such corporation or other entity, immediately
following such sale or other disposition more than 50% of, respectively, the outstanding shares of common stock (or similar equity
security) of such corporation or other entity and the combined voting power of the securities of such corporation or other entity
entitled to vote generally in the election of directors, is then beneficially owned, directly or indirectly, by the individuals
and entities who were the respective beneficial owners of the Outstanding Common Stock and the Company Voting Securities immediately
prior to such sale or disposition in substantially the same proportions as their ownership of the Outstanding Common Stock and
Company Voting Securities immediately prior to such sale or disposition.


 


“Code” means the
Internal Revenue Code of 1986, as amended. References to a section of the Code include that section and any comparable section
or sections of any future legislation that amends, supplements or supersedes said section.


 


“Committee” means
the committee established in accordance with Section 3.1.


 


“Company” means
MyDx, Inc., a Nevada Corporation, and its successors.


 


“Common Stock”
means the Company’s common Stock, par value $.001 per share.


 


“Company Voting Securities”
means the combined voting power of all outstanding securities of the Company entitled to vote generally in the election of directors
of the Company.


 


“Date of Grant”
means the date designated by the Committee as the date as of which it grants an Award, which shall not be earlier than the date
on which the Committee approves the granting of such Award.


 


“Effective Date”
shall have the meaning given to such term in Section 1.2.


 


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


 


“Exercise Price”
means, with respect to a Stock Appreciation Right, the amount established by the Committee in the related Award Agreement as the
amount to be subtracted from the Fair Market Value on the date of exercise in order to determine the amount of the payment to be
made to the Participant, as further described in Section 6.2(b).


 


"Fair Market Value"
means, as of any date, the value of Common Stock determined as follows:


 


(i)       if
the Common Stock is listed on any established stock exchange or a national market system, including without limitation the NYSE
Archipelago Exchange, the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, the Fair Market Value
of a Share of Common Stock shall be the closing sales price of a Share of Common Stock (or the closing bid, if no such sales were
reported) as quoted on such exchange or system for the last market trading day prior to the time of determination, as reported
in The Wall Street Journal or such other source as the Administrator deems reliable;


 


(ii)      if
the Common Stock is listed on the OTC Bulletin Board or on the Pink Sheets trading market or is otherwise regularly quoted by a
recognized securities dealer but is not listed in the manner contemplated by clause (i) above, the Fair Market Value of a Share
of Common Stock shall be the mean between the high bid and low asked prices for the Common Stock on the last market trading day
prior to the day of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable;
or


 


(iii)    if
neither clause (i) above nor clause (ii) above applies, the Fair Market Value shall be determined in good faith by the Administrator.


 






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“Incentive Stock Option”
means a stock option within the meaning of Section 422 of the Code.


 


“Merger” means
any merger, reorganization, consolidation, share exchange, transfer of assets or other transaction having similar effect involving
the Company.


 


“Non-Employee Director”
means a member of the Board who (i) is not currently an officer or otherwise employed by the Company or a parent or a subsidiary
of the Company, (ii) does not receive compensation directly or indirectly from the Company or a parent or a subsidiary of the Company
for services rendered as a consultant or in any capacity other than as a director, except for an amount for which disclosure would
not be required pursuant to Item 404(a) of Regulation S-K, (iii) does not possess an interest in any other transaction for which
disclosure would be required pursuant to Item 404(a) of Regulation S-K, (iv) is not engaged in a business relationship for which
disclosure would be required pursuant to Item 404(b) of Regulation S-K, and (v) qualifies as “Outside Director” pursuant
to Section 162(m) of the Code.


 


“Non-Employee Director Option”
means a stock option granted to a Non-Employee Director in accordance with Section 6.1(a).


 


“Non-Qualified Stock Option”
means a stock option which is not an Incentive Stock Option.


 


“Options” means
all Non-Qualified Stock Options and Incentive Stock Options granted at any time under the Plan.


 


“Outstanding Common Stock”
means, at any time, the issued and outstanding shares of Common Stock.


 


“Participant”
means a person designated to receive an Award under the Plan in accordance with Section 5.1.


 


“Performance Awards”
means Awards granted in accordance with Article VIII.


 


“Plan” means the
MyDx, Inc. 2017 Stock Incentive Plan as described herein, as the same may be amended from time to time.


 


“Purchase Price”,
with respect to Options, shall have the meaning set forth in Section 6.1(b).


 


“Restricted Shares”
means Common Stock subject to restrictions imposed in connection with Awards granted under Article VII.


 


“Retirement” means
early or normal retirement under a pension plan or arrangement of the Company or one of its Subsidiaries in which the Participant
participates.


 


“Stock Appreciation Rights”
means Awards granted in accordance with Article VI.


 


“Subsidiary” means
a subsidiary of the Company within the meaning of Section 424(f) of the Code.


 


“Termination of Employment”
means the voluntary or involuntary termination of a Participant’s employment with the Company or a Subsidiary for any reason,
including death, disability, retirement or as the result of the divestiture of the Participant’s employer or any similar
transaction in which the Participant’s employer ceases to be the Company or one of its Subsidiaries. Whether entering military
or other government service shall constitute Termination of Employment, or whether a Termination of Employment shall occur as a
result of disability, shall be determined in each case by the Committee in its sole discretion. In the case of a consultant who
is not an employee of the Company or a Subsidiary, Termination of Employment shall mean voluntary or involuntary termination of
the consulting relationship for any reason. In the case of a Non-Employee Director, Termination of Employment shall mean voluntary
or involuntary termination, non-election, removal or other act which results in such Non-Employee Director no longer serving in
such capacity.


 






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ARTICLE III


ADMINISTRATION


 


3.1         Committee.
The Plan shall be administered by a committee of the Board (the “Committee”). The Committee shall have
exclusive and final authority in each determination, interpretation or other action affecting the Plan and its Participants. The
Committee shall have the sole discretionary authority to interpret the Plan, to establish, modify and amend administrative rules
for the Plan, to impose such conditions and restrictions on Awards as it determines appropriate, and to take such steps in connection
with the Plan and Awards granted hereunder as it may deem necessary or advisable. The Committee may, subject to compliance with
applicable legal requirements, delegate such of its powers and authority under the Plan as it deems appropriate to designated
officers or employees of the Company. In addition, the Board may exercise any of the authority conferred upon the Committee hereunder.
In the event of any such delegation of authority or exercise of authority by the Board, references in the Plan to the Committee
shall be deemed to refer to the delegate of the Committee or the Board, as the case may be.


 


ARTICLE IV


SHARES


 


4.1         Number
of Shares Issuable. The total number of shares initially authorized to be issued under the Plan shall be one hundred fifty
million (150,000,000) shares of Common Stock. The number of shares available for issuance under the Plan shall be subject to adjustment
in accordance with the terms herein. The shares to be offered under the Plan shall be authorized and unissued shares of Common
Stock, or issued shares of Common Stock which will have been reacquired by the Company.


 


4.2         Shares
Subject to Terminated Awards. Shares of Common Stock covered by any unexercised portions of terminated Options (including canceled
Options) granted under Article VI, shares of Common Stock forfeited as provided in Section 7.2(a) and shares of Common Stock subject
to any Award that are otherwise surrendered by a Participant may be subject to new Awards under the Plan. Shares of Common Stock
subject to Options, or portions thereof, that have been surrendered in connection with the exercise of Stock Appreciation Rights
shall not be available for subsequent Awards under the Plan, but shares of Common Stock issued in payment of such Stock Appreciation
Rights shall not be charged against the number of shares of Common Stock available for the grant of Awards hereunder.


 


ARTICLE V


PARTICIPATION


 


5.1         Eligible
Participants. Participants in the Plan shall be such key employees, non-employee directors and consultants of the Company and
its Subsidiaries, whether or not members of the Board, as the Committee, in its sole discretion, may designate from time to time.
The Committee’s designation of a Participant in any year shall not require the Committee to designate such person to receive
Awards in any other year. The designation of a Participant to receive an Award under one portion of the Plan does not require the
Committee to include such Participant under other portions of the Plan. The Committee shall consider such factors as it deems pertinent
in selecting Participants and in determining the types and amounts of their respective Awards.


 






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ARTICLE VI


STOCK OPTIONS AND STOCK APPRECIATION RIGHTS


 


6.1         Option
Awards.


 


(a)       Grant
of Options. The Committee may grant, to such Participants as the Committee may select, Options entitling the Participants to
purchase shares of Common Stock from the Company in such numbers, at such prices, and on such terms and subject to such conditions,
not inconsistent with the terms of the Plan, as may be established by the Committee and are subject to adjustment as described
herein. Non-Qualified Stock Options granted after the Effective Date shall have an exercise price of not less than 100% of the
Fair Market Value on the Date of Grant. Other Incentive Stock Options may be granted at such prices and in such quantities as determined
by the Committee. Except as provided in Sections 6.3(c), or 6.5, Non-Employee Director Options shall not be exercisable prior to
the first anniversary of the Date of Grant, at which time they will be immediately exercisable, in whole or in part, and shall
remain exercisable until the tenth anniversary of the Date of Grant.


 


(b)       Purchase
Price of Options. The Purchase Price of each share of Common Stock which may be purchased upon exercise of any Option granted
under the Plan shall be determined by the Committee.


 


(c)       Designation
of Options. Except as otherwise expressly provided in the Plan, the Committee may designate, at the time of the grant of an
Option, such Option as an Incentive Stock Option or a Non-Qualified Stock Option; provided, however, that an Option may
be designated as an Incentive Stock Option only if the applicable Participant is an employee of the Company or a Subsidiary on
the Date of Grant.


 


(d)       Incentive
Stock Option Share Limitation. No Participant may be granted Incentive Stock Options under the Plan (or any other plans of
the Company and its Subsidiaries) that would result in Incentive Stock Options to purchase shares of Common Stock with an aggregate
Fair Market Value (measured on the Date of Grant) of more than $500,000 first becoming exercisable by such Participant in any one
calendar year.


 


(e)       Rights
as a Stockholder. A Participant or a transferee of an Option pursuant to Section 9.4 shall have no rights as a stockholder
with respect to the shares of Common Stock covered by an Option until that Participant or transferee shall have become the holder
of record of any such shares, and no adjustment shall be made with respect to any such shares of Common Stock for dividends in
cash or other property or distributions of other rights on the Common Stock for which the record date is prior to the date on which
that Participant or transferee shall have become the holder of record of any shares covered by such Option; provided, however,
that Participants are entitled to share adjustments to reflect capital changes under Section 9.7.


 


6.2         Stock
Appreciation Rights.


 


(a)       Stock
Appreciation Right Awards. The Committee is authorized to grant to any Participant one or more Stock Appreciation Rights. Such
Stock Appreciation Rights may be granted either independent of or in tandem with Options granted to the same Participant. Stock
Appreciation Rights granted in tandem with Options may be granted simultaneously with, or, in the case of Non-Qualified Stock Options,
subsequent to, the grant to such Participant of the related Options; provided, however, that: (i) any Option covering any share
of Common Stock shall expire and not be exercisable upon the exercise of any Stock Appreciation Right with respect to the same
share, (ii) any Stock Appreciation Right covering any share of Common Stock shall expire and not be exercisable upon the exercise
of any Option with respect to the same share, and (iii) an Option and a Stock Appreciation Right covering the same share of Common
Stock may not be exercised simultaneously. Upon exercise of a Stock Appreciation Right with respect to a share of Common Stock,
the Participant shall be entitled to receive an amount equal to the excess, if any, of (A) the Fair Market Value of a share of
Common Stock on the date of exercise over (B) the Exercise Price of such Stock Appreciation Right established in the Award Agreement,
which amount shall be payable as provided in Section 6.2(c).


 






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(b)       Exercise
Price. The Exercise Price established for any Stock Appreciation Right granted under this Plan shall be determined by the Committee,
but in the case of Stock Appreciation Rights granted in tandem with Options shall not be less than the Purchase Price of the related
Options. Upon exercise of Stock Appreciation Rights, the number of shares issuable upon exercise under any related Options shall
automatically be reduced by the number of shares of Common Stock represented by such Options which are surrendered as a result
of the exercise of such Stock Appreciation Rights.


 


(c)       Payment
of Incremental Value. Any payment that may become due from the Company by reason of a Participant’s exercise of a Stock
Appreciation Right may be paid to the Participant as determined by the Committee (i) all in cash, (ii) all in Common Stock, or
(iii) in any combination of cash and Common Stock. In the event that all or a portion of the payment is to be made in Common Stock,
the number of shares of Common Stock to be delivered in satisfaction of such payment shall be determined by dividing the amount
of such payment or portion thereof by the Fair Market Value on the date of exercise. No fractional share of Common Stock shall
be issued to make any payment in respect of Stock Appreciation Rights; if any fractional share would otherwise be issuable, the
combination of cash and Common Stock payable to a Participant shall be adjusted as directed by the Committee to avoid the issuance
of any fractional share.


 


6.3         Terms
of Stock Options and Stock Appreciation Rights.


 


(a)       Conditions
on Exercise. An Award Agreement with respect to Options and/or Stock Appreciation Rights may contain such waiting periods,
exercise dates and restrictions on exercise (including, but not limited to, periodic installments) as may be determined by the
Committee at the time of grant.


 


(b)      Duration
of Options and Stock Appreciation Rights. Options and Stock Appreciation Rights shall terminate after the first to occur of
the following events:


 


(i)       Expiration
of the Option or Stock Appreciation Right as provided in the related Award Agreement; or


 


(ii)      Termination
of the Award as provided in Section 6.3(e), following the applicable Participant’s Termination of Employment; or


 


(iii)     In
the case of an Incentive Stock Option, ten (10) years from the Date of Grant; or


 


(iv)    Solely
in the case of a Stock Appreciation Right granted in tandem with an Option, upon the expiration of the related Option.


 


(b)       Acceleration
of Exercise Time. The Committee, in its sole discretion, shall have the right (but shall not in any case be obligated), exercisable
at any time after the Date of Grant, to permit the exercise of any Option or Stock Appreciation Right prior to the time such Option
or Stock Appreciation Right would otherwise become exercisable under the terms of the related Award Agreement.


 


(c)       Extension
of Exercise Time. The Committee, in its sole discretion, shall have the right (but shall not in any case be obligated), exercisable
on or at any time after the Date of Grant, to permit the exercise of any Option or Stock Appreciation Right after its expiration
date described in Section 6(b).


 






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6.4         Termination.


 


(a)       Termination.
In the event of Termination of Employment of a Participant other than by reason of death, disability or Retirement, the right of
the Participant to exercise any Option or Stock Appreciation Right shall terminate 90 days after the date of such Termination of
Employment, unless the exercise period is extended by the Committee in accordance with Section 6.3(d).


 


(b)       Disability
or Retirement. In the event of a Participant’s Termination of Employment by reason of disability or Retirement, the right
of the Participant to exercise any Option or Stock Appreciation Right which he or she was entitled to exercise upon Termination
of Employment (or which became exercisable at a later date pursuant to Section 6.3(e)(ii)) shall terminate one year after the date
of such Termination of Employment, unless the exercise period is extended by the Committee in accordance with Section 6.3(d). In
no event, however, may any Option or Stock Appreciation Right be exercised later than the date of expiration of the Option determined
pursuant to Section 6.3(b)(i), (iii) or (iv).


 


(c)       Death.
In the event of the death of a Participant while employed by the Company or a Subsidiary or within any additional period of time
from the date of the Participant’s Termination of Employment and prior to the expiration of any Option or Stock Appreciation
Right as provided pursuant to Section 6.3(e)(i)(B) or Section 6.3(d) above, to the extent the right to exercise the Option or Stock
Appreciation Right was accrued as of the date of such Termination of Employment and had not expired during such additional period,
the right of the Participant’s Beneficiary to exercise the Option or Stock Appreciation Right shall terminate one year after
the date of the Participant’s death (but in no event more than one year from the date of the Participant’s Termination
of Employment by reason of disability or Retirement), unless the exercise period is extended by the Committee in accordance with
Section 6.3(d). In no event, however, may any Option or Stock Appreciation Right be exercised later than the date of expiration
of the Option determined pursuant to Section 6.3(b)(i), (iii) or (iv).


 


(d)       Termination
of Unvested Options or Stock Appreciation Rights. Upon Termination of Employment,subject to Section 6.3(c), to the extent the
right to exercise an Option or a Stock Appreciation Right, or any portion thereof, has not accrued as of the date of Termination
of Employment, such right shall expire at the date of such Termination of Employment. Notwithstanding the foregoing, the Committee,
in its sole discretion and under such terms as it deems appropriate, may permit, for a Participant who terminates employment by
reason of Retirement and who will continue to render significant services to the Company or one of its Subsidiaries after his or
her Termination of Employment, the continued vesting of his or her Options and Stock Appreciation Rights during the period in which
that individual continues to render such services.


 


6.5         Exercise
Procedures. Each Option and Stock Appreciation Right granted under the Plan shall be exercised by written notice to the Company
which must be received by the officer or employee of the Company designated in the Award Agreement at or before the close of business
on the termination date of the Award. The Purchase Price of shares purchased upon exercise of an Option granted under the Plan
shall be paid in full in cash by the Participant pursuant to the Award Agreement; provided, however, that the Committee may (but
shall not be required to) permit payment to be made by delivery to the Company of either (a) shares of Common Stock (which may
include Restricted Shares or shares otherwise issuable in connection with the exercise of the Option, subject to such rules as
the Committee deems appropriate) or (b) any combination of cash and Common Stock or (c) such other consideration as the Committee
deems appropriate and in compliance with applicable law (including payment in accordance with a cashless exercise program under
which, if so instructed by a Participant, shares of Common Stock may be issued directly to the Participant’s broker or dealer
upon receipt of an irrevocable written notice of exercise from the Participant). In the event that any shares of Common Stock shall
be transferred to the Company to satisfy all or any part of the Purchase Price, the part of the Purchase Price deemed to have been
satisfied by such transfer of shares of Common Stock shall be equal to the product derived by multiplying the Fair Market Value
as of the date of exercise times the number of shares of Common Stock transferred to the Company. The Participant may not transfer
to the Company in satisfaction of the Purchase Price any fractional share of Common Stock. Any part of the Purchase Price paid
in cash upon the exercise of any Option shall be added to the general funds of the Company and may be used for any proper corporate
purpose. Unless the Committee shall otherwise determine, any shares of Common Stock transferred to the Company as payment of all
or part of the Purchase Price upon the exercise of any Option shall be held as treasury shares.


 






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6.6         Adjustments upon Changes
in Capitalization, dissolution, Merger or Sale of Assets.


 


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


 


(b)       Dissolution
or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Committee shall notify each Participant
as soon as practicable prior to the effective date of such proposed transaction. The Committee in its discretion may provide for
a Participant to have the right to exercise his or her Option until ten (10) days prior to such transaction as to all of the Options
covered thereby, including Shares as to which the Option would not otherwise be exercisable. In addition, the Committee may provide
that any Company repurchase option applicable to any Shares purchased upon exercise of an Option shall lapse as to all such Shares,
provided the proposed dissolution or liquidation takes place at the time and in the manner contemplated. To the extent it has not
been previously exercised, an Option will terminate immediately prior to the consummation of such proposed action.


 


(c)       Merger
or Asset Sale. In the event of a merger of the Company with or into another corporation, or the sale of substantially all of
the assets of the Company, each outstanding Option shall be assumed or an equivalent option or right substituted by the successor
corporation or a Parent or Subsidiary of the successor corporation. In the event that the successor corporation refuses to assume
or substitute for the Option, the Participant shall fully vest in and have the right to exercise the Option as to all of the Optioned
Stock, including Shares as to which it would not otherwise be vested or exercisable. If an Option becomes fully vested and exercisable
in lieu of assumption or substitution in the event of a merger or sale of assets, the Committee shall notify the Participant in
writing or electronically that the Option shall be fully vested and exercisable for a period of fifteen (15) days from the date
of such notice, and the Option shall terminate upon the expiration of such period. For the purposes of this paragraph, the Option
shall be considered assumed if, following the merger or sale of assets, the option or right confers the right to purchase or receive,
for each Share of Optioned Stock, immediately prior to the merger or sale of assets, the consideration (whether stock, cash, or
other securities or property) received in the merger or sale of assets by holders of Common Stock for each Share held on the effective
date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders
of a majority of the outstanding Shares); provided, however, that if such consideration received in the merger or sale of assets
is not solely common stock of the successor corporation or its Parent, the Committee may, with the consent of the successor corporation,
provide for the consideration to be received upon the exercise of the Option, for each Share of Optioned Stock to be solely common
stock of the successor corporation or its Parent equal in fair market value to the per share consideration received by holders
of Common Stock in the merger or sale of assets.


 


6.7         Change
in Control. Unless otherwise provided by the Committee in the applicable Award Agreement, in the event of a Change in Control,
all Options and Stock Appreciation Rights outstanding on the date of such Change in Control shall become immediately and fully
exercisable. The provisions of this Section 6.7 shall not be applicable to any Options or Stock Appreciation Rights granted to
a Participant if any Change in Control results from such Participant’s beneficial ownership (within the meaning of Rule 13d-3
under the Exchange Act) of Common Stock or Company Voting Securities.


 






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ARTICLE VII


RESTRICTED SHARES


 


7.1         Restricted
Share Awards. The Committee may grant to any Participant an Award of such number of shares of Common Stock on such terms, conditions
and restrictions, whether based on performance standards, periods of service, retention by the Participant of ownership of purchased
or designated shares of Common Stock or other criteria, as the Committee shall establish. With respect to performance-based Awards
of Restricted Shares intended to qualify for deductibility under Section 162(m) of the Code, performance targets will include specified
levels of one or more of operating income, return or investment, return on stockholders’ equity, earnings before interest,
taxes, depreciation and amortization and/or earnings per share. The terms of any Restricted Share Award granted under this Plan
may be set forth in an Award Agreement which shall contain provisions determined by the Committee and not inconsistent with this
Plan.


 


(a)       Issuance
of Restricted Shares. As soon as practicable after the Date of Grant of a Restricted Share Award by the Committee, the Company
shall cause to be transferred on the books of the Company or its agent, shares of Common Stock, registered on behalf of the Participant,
evidencing the Restricted Shares covered by the Award. All shares of Common Stock covered by Awards under this Article VII shall
be subject to the restrictions, terms and conditions contained in the Plan. Until the lapse or release of all restrictions applicable
to an Award of Restricted Shares the share certificates representing such Restricted Shares may be held in custody by the Company,
its designee, or, if the certificates bear a restrictive legend, by the Participant. Upon the lapse or release of all restrictions
with respect to an Award as described in Section 7.1(d), one or more share certificates, registered in the name of the Participant,
for an appropriate number of shares as provided in Section 7.1(d), free of any restrictions set forth in the Plan (however subject
to any restrictions that may be imposed by law) shall be delivered to the Participant.


 


(b)       Stockholder
Rights. Beginning on the Date of Grant of a Restricted Share Award, the Participant shall become a stockholder of the Company
with respect to all shares and shall have all of the rights of a stockholder, including, but not limited to, the right to vote
such shares and the right to receive dividends; provided, however, that any shares of Common Stock distributed as a dividend or
otherwise with respect to any Restricted Shares as to which the restrictions have not yet lapsed, shall be subject to the same
restrictions as such Restricted Shares and held or restricted as provided in Section 7.1(a).


 


(c)       Restriction
on Transferability. None of the Restricted Shares may be assigned or transferred (other than by will or the laws of descent
and distribution or to an inter vivos trust with respect to which the Participant is treated as the owner under Sections 671 through
677 of the Code), pledged or sold prior to the lapse of the restrictions applicable thereto without prior Company approval.


 


(d)       Delivery
of Shares Upon Vesting. Upon expiration or earlier termination of the forfeiture period without a forfeiture and the satisfaction
of or release from any other conditions prescribed by the Committee, or at such earlier time as provided under the provisions of
Section 7.3, the restrictions applicable to the Restricted Shares shall lapse. As promptly as administratively feasible thereafter,
subject to the requirements of Section 9.5, the Company shall deliver to the Participant or, in case of the Participant’s
death, to the Participant’s Beneficiary, one or more share certificates for the appropriate number of shares of Common Stock,
free of all such restrictions, except for any restrictions that may be imposed by law.


 


7.2         Terms
of Restricted Shares.


 


(a)       Change
in Control. Unless otherwise provided by the Committee in the applicable Award Agreement, in the event of a Change in Control,
all restrictions applicable to the Restricted Share Award shall terminate fully and the Participant shall immediately have the
right to the delivery of share certificates for such shares in accordance with Section 7.1(d).


 






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ARTICLE VIII


PERFORMANCE AWARDS


 


8.1         Performance
Awards.


 


(a)       Award
Periods and Calculations of Potential Incentive Amounts. The Committee may grant Performance Awards to Participants. A Performance
Award shall consist of the right to receive a payment (measured by the Fair Market Value of a specified number of shares of Common
Stock, increases in such Fair Market Value during the Award Period and/or a fixed cash amount) contingent upon the extent to which
certain predetermined performance targets have been met during an Award Period. Performance Awards may be made in conjunction with,
or in addition to, Restricted Share Awards made under Article VII. The Award Period shall be two or more fiscal or calendar years
as determined by the Committee. The Committee, in its discretion and under such terms as it deems appropriate, may permit newly
eligible employees, such as those who are promoted or newly hired, to receive Performance Awards after an Award Period has commenced.


 


(b)       Performance
Targets. The performance targets may include such goals related to the performance of the Company and/or the performance of
a Participant as may be established by the Committee in its discretion. In the case of Performance Awards intended to qualify for
deductibility under Section 162(m) of the Code, the targets will include specified levels of one or more of operating income, return
on investment, return on stockholders’ equity, earnings before interest, taxes, depreciation and amortization and/or earnings
per share. The performance targets established by the Committee may vary for different Award Periods and need not be the same for
each Participant receiving a Performance Award in an Award Period. Except to the extent inconsistent with the performance-based
compensation exception under Section 162(m) of the Code, in the case of Performance Awards granted to employees to whom such section
is applicable, the Committee, in its discretion, but only under extraordinary circumstances as determined by the Committee, may
change any prior determination of performance targets for any Award Period at any time prior to the final determination of the
value of a related Performance Award when events or transactions occur to cause such performance targets to be an inappropriate
measure of achievement.


 


(c)       Earning
Performance Awards. The Committee, on or as soon as practicable after the Date of Grant, shall prescribe a formula to determine
the percentage of the applicable Performance Award to be earned based upon the degree of attainment of performance targets.


 


(d)       Payment
of Earned Performance Awards. Payments of earned Performance Awards shall be made in cash or shares of Common Stock or a combination
of cash and shares of Common Stock, in the discretion of the Committee. The Committee, in its sole discretion, may provide such
terms and conditions with respect to the payment of earned Performance Awards as it may deem desirable.


 






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8.2         Terms
of Performance Awards.


 


(a)       Termination
of Employment. Unless otherwise provided below or in Section 8.3, in the case of a Participant’s Termination of Employment
prior to the end of an Award Period, the Participant will not have earned any Performance Awards for that Award Period.


 


(b)       Retirement.
If a Participant’s Termination of Employment is because of Retirement prior to the end of an Award Period, the Participant
will not be paid any Performance Award, unless the Committee, in its sole and exclusive discretion, determines that an Award should
be paid. In such a case, the Participant shall be entitled to receive a pro-rata portion of his or her Award as determined under
subsection (d) of this Section 8.2.


 


(c)       Death
or Disability. If a Participant’s Termination of Employment is due to death or to disability (as determined in the sole
and exclusive discretion of the Committee) prior to the end of an Award Period, the Participant or the Participant’s personal
representative shall be entitled to receive a pro-rata share of his or her Award as determined under subsection (d) of this Section
8.2.


 


(d)       Pro-Rata
Payment. The amount of any payment to be made to a Participant whose employment is terminated by Retirement, death or disability
(under the circumstances described in subsections (b) and (c)) will be the amount determined by multiplying (i) the amount of the
Performance Award that would have been earned through the end of the Award Period had such employment not been terminated by (ii)
a fraction, the numerator of which is the number of whole months such Participant was employed during the Award Period, and the
denominator of which is the total number of months of the Award Period. Any such payment made to a Participant whose employment
is terminated prior to the end of an Award Period shall be made at the end of such Award Period, unless otherwise determined by
the Committee in its sole discretion. Any partial payment previously made or credited to a deferred account for the benefit of
a Participant in accordance with Section 8.1(d) of the Plan shall be subtracted from the amount otherwise determined as payable
as provided in this Section 8.2(d).


 


(e)       Other
Events. Notwithstanding anything to the contrary in this Article VIII, the Committee may, in its sole and exclusive discretion,
determine to pay all or any portion of a Performance Award to a Participant who has terminated employment prior to the end of an
Award Period under certain circumstances (including the death, disability or Retirement of the Participant or a material change
in circumstances arising after the Date of Grant), subject to such terms and conditions as the Committee shall deem appropriate.


 


8.3         Change
in Control. Unless otherwise provided by the Committee in the applicable Award Agreement, in the event of a Change in Control,
all Performance Awards for all Award Periods shall immediately become fully payable to all Participants and shall be paid to Participants
within thirty (30) days after such Change in Control.


 






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ARTICLE IX


TERMS APPLICABLE TO ALL AWARDS GRANTED UNDER THE
PLAN


 


9.1         Plan
Provisions Control Award Terms. The terms of the Plan shall govern all Awards granted under the Plan, and in no event shall
the Committee have the power to grant any Award under the Plan the terms of which are contrary to any of the provisions of the
Plan. In the event any provision of any Award granted under the Plan shall conflict with any term in the Plan as constituted on
the Date of Grant of such Award, the term in the Plan as constituted on the Date of Grant of such Award shall control. Except as
provided in Section 9.3 and Section 9.7, the terms of any Award granted under the Plan may not be changed after the Date of Grant
of such Award so as to materially decrease the value of the Award without the express written approval of the holder. The Committee
may make or enforce limitations so that the number of shares of Stock underlying the Plan and the total amount of Common Stock
available for issuance under Plan does not exceed the applicable percentage as may be required by the laws of the State of Nevada
and the rules and regulations promulgated thereunder, or in accordance with such other securities laws of any State, the compliance
with which the Committee in its sole discretion believes is the in the best interest of the Company.


 


9.2         Award
Agreement. No person shall have any rights under any Award granted under the Plan unless and until the Company and the Participant
to whom such Award shall have been granted shall have executed and delivered an Award Agreement or the Participant shall have received
and acknowledged notice of the Award authorized by the Committee expressly granting the Award to such person and containing provisions
setting forth the terms of the Award.


 


9.3         Modification
of Award After Grant. No Award granted under the Plan to a Participant may be modified (unless such modification does not materially
decrease the value of that Award) after its Date of Grant except by express written agreement between the Company and such Participant,
provided that any such change (a) may not be inconsistent with the terms of the Plan, and (b) shall be approved by the Committee.


 


9.4         Limitation
on Transfer. Except as provided in Section 7.1(c) in the case of Restricted Shares, a Participant’s rights and interest
under the Plan may not be assigned or transferred other than by will or the laws of descent and distribution and, during the lifetime
of a Participant, only the Participant personally (or the Participant’s personal representative) may exercise rights under
the Plan. The Participant’s Beneficiary may exercise the Participant’s rights to the extent they are exercisable under
the Plan following the death of the Participant. Notwithstanding the foregoing, the Committee may grant Non-Qualified Stock Options
that are transferable, without payment of consideration, to immediate family members of the Participant or to trusts or partnerships
for such family members, and the Committee may also amend outstanding Non-Qualified Stock Options to provide for such transferability.


 


9.5         Taxes.
The Company shall be entitled, if the Committee deems it necessary or desirable, to withhold (or secure payment from the Participant
in lieu of withholding) the amount of any withholding or other tax required by law to be withheld or paid by the Company with respect
to any amount payable and/or shares issuable under such Participant’s Award or with respect to any income recognized upon
a disqualifying disposition of shares received pursuant to the exercise of an Incentive Stock Option, and the Company may defer
payment of cash or issuance of shares upon exercise or vesting of an Award unless indemnified to its satisfaction against any liability
for any such tax. The amount of such withholding or tax payment shall be determined by the Committee and shall be payable by the
Participant at such time as the Committee determines in accordance with the following rules:


 


(a)       The
Participant shall have the right to elect to meet his or her withholding requirement (i) by having withheld from such Award at
the appropriate time that number of shares of Common Stock, rounded up to the next whole share, the Fair Market Value of which
is equal to the amount of withholding taxes due, (ii) by direct payment to the Company in cash of the amount of any taxes required
to be withheld with respect to such Award or (iii) by a combination of withholding such shares and paying cash.


 


(b)       The
Committee shall have the discretion as to any Award to cause the Company to pay to tax authorities for the benefit of the applicable
Participant, or to reimburse such Participant for, the individual taxes which are due on the grant, exercise or vesting of any
Award or the lapse of any restriction on any Award (whether by reason of such Participant’s filing of an election under Section
83(b) of the Code or otherwise), including, but not limited to, Federal income tax, state income tax, local income tax and excise
tax under Section 4999 of the Code, as well as for any such taxes as may be imposed upon such tax payment or reimbursement.


 


(c)        In
the case of Participants who are subject to Section 16 of the Exchange Act, the Committee may impose such limitations and restrictions
as it deems necessary or appropriate with respect to the delivery or withholding of shares of Common Stock to meet tax withholding
obligations.


 






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9.6         Surrender
of Awards. Any Award granted under the Plan may be surrendered to the Company for cancellation on such terms as the Committee
and the Participant approve.


 


9.7         Adjustments
to Reflect Capital Changes.


 


(a)       Recapitalization.
The number and kind of shares subject to outstanding Awards, the Purchase Price or Exercise Price for such shares, the number and
kind of shares available for Awards subsequently granted under the Plan and the maximum number of shares in respect of which Awards
can be made to any Participant in any calendar year shall be appropriately adjusted to reflect any stock dividend, stock split,
combination or exchange of shares, merger, consolidation or other change in capitalization with a similar substantive effect upon
the Plan or the Awards granted under the Plan. The Committee shall have the power and sole discretion to determine the amount of
the adjustment to be made in each case.


 


(b)       Merger.
After any Merger in which the Company is the surviving corporation, each Participant shall, at no additional cost, be entitled
upon any exercise of an Option or receipt of any other Award to receive (subject to any required action by stockholders), in lieu
of the number of shares of Common Stock receivable or exercisable pursuant to such Award prior to such Merger, the number and class
of shares or other securities to which such Participant would have been entitled pursuant to the terms of the Merger if, at the
time of the Merger, such Participant had been the holder of record of a number of shares of Common Stock equal to the number of
shares of Common Stock receivable or exercisable pursuant to such Award. Comparable rights shall accrue to each Participant in
the event of successive Mergers of the character described above. In the event of a Merger in which the Company is not the surviving
corporation, the surviving, continuing, successor or purchasing corporation, as the case may be (the “Acquiring Corporation”),
will either assume the Company’s rights and obligations under outstanding Award Agreements or substitute awards in respect
of the Acquiring Corporation’s stock for outstanding Awards, provided, however, that if the Acquiring Corporation does not
assume or substitute for such outstanding Awards, the Board shall provide prior to the Merger that any unexercisable and/or unvested
portion of the outstanding Awards shall be immediately exercisable and vested as of a date prior to such merger or consolidation,
as the Board so determines. The exercise and/or vesting of any Award that was permissible solely by reason of this Section 9.7(b)
shall be conditioned upon the consummation of the Merger. Any Options which are neither assumed by the Acquiring Corporation not
exercised as of the date of the Merger shall terminate effective as of the effective date of the Merger.


 


(c)       Options
to Purchase Shares or Stock of Acquired Companies. After any merger in which the Company or a Subsidiary shall be a surviving
corporation, the Committee may grant substituted options under the provisions of the Plan, pursuant to Section 424 of the Code,
replacing old options granted under a plan of another party to the merger whose shares of stock subject to the old options may
no longer be issued following the merger. The manner of application of the foregoing provisions to such options and any appropriate
adjustments shall be determined by the Committee in its sole discretion. Any such adjustments may provide for the elimination of
any fractional shares which might otherwise become subject to any Options.


 


9.8         No
Right to Employment. No employee or other person shall have any claim of right to be granted an Award under the Plan. Neither
the Plan nor any action taken hereunder shall be construed as giving any employee any right to be retained in the employ of the
Company or any of its Subsidiaries.


 


9.9         Awards
Not Includable for Benefit Purposes. Payments received by a Participant pursuant to the provisions of the Plan shall not be
included in the determination of benefits under any pension, group insurance or other benefit plan applicable to the Participant
which is maintained by the Company or any of its Subsidiaries, except as may be provided under the terms of such plans or determined
by the Board.


 


9.10       Governing
Law. All determinations made and actions taken pursuant to the Plan shall be governed by the laws of the State of Nevada, other
than the conflict of law provisions thereof, and construed in accordance therewith.


 






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9.11       No
Strict Construction. No rule of strict construction shall be implied against the Company, the Committee or any other person
in the interpretation of any of the terms of the Plan, any Award granted under the Plan or any rule or procedure established by
the Committee.


 


9.12       Captions.
The captions (i.e., all Section headings) used in the Plan are for convenience only, do not constitute a part of the Plan, and
shall not be deemed to limit, characterize or affect in any way any provisions of the Plan, and all provisions of the Plan shall
be construed as if no captions had been used in the Plan.


 


9.13       Severability.
Whenever possible, each provision in the Plan and every Award at any time granted under the Plan shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of the Plan or any Award at any time granted under the
Plan shall be held to be prohibited by or invalid under applicable law, then (a) such provision shall be deemed amended to accomplish
the objectives of the provision as originally written to the fullest extent permitted by law and (b) all other provisions of the
Plan, such Award and every other Award at any time granted under the Plan shall remain in full force and effect.


 


9.14       Amendment
and Termination.


 


(a)       Amendment.
The Board shall have complete power and authority to amend the Plan at any time without the authorization or approval of the Company’s
stockholders. No termination or amendment of the Plan may, without the consent of the Participant to whom any Award shall theretofore
have been granted under the Plan, materially adversely affect the right of such individual under such Award.


 


(b)       Termination.
The Board shall have the right and the power to terminate the Plan at any time. No Award shall be granted under the Plan after
the termination of the Plan, but the termination of the Plan shall not have any other effect and any Award outstanding at the time
of the termination of the Plan may be exercised after termination of the Plan at any time prior to the expiration date of such
Award to the same extent such Award would have been exercisable had the Plan not been terminated.


 


9.15       Registration
of Shares.


 


To the extent legally available,
the Committee shall maintain the right, pursuant to appropriate authorization of the Company and the Company’s Board and
with no further approval of the Company’s shareholders, to register any shares issuable pursuant to the Plan in any applicable
registration statement with the United States Securities and Exchange Commission, including, but not limited to, a registration
statement filed under a Form S-8 Registration Statement.


 


	DATE ADOPTED BY THE BOARD OF DIRECTORS: 	___12/25/2016____________




 


 


	DATE ADOPTED BY THE SHAREHOLDERS: 	___12/25/2016____________




 


 


 


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