Exhibit
10.1


 


QUALIGEN
THERAPEUTICS, INC.


STOCK
OPTION AGREEMENT


 


The
Board of Directors of Qualigen Therapeutics, Inc., a Delaware corporation (the “Company”), has approved a grant
to «First_Name» «Last_Name», an individual (the “Optionee”), of an option (the “Option”)
to purchase shares of Common Stock of the Company, $0.001 par value per share (the “Shares”), pursuant to the
Company’s 2020 Stock Incentive Plan (the “Plan”) and this Stock Option Agreement (the “Option
Agreement”), as follows:


 


	Grant
    Date	«Grant_Date»
	Total
    Number of Shares	«Total_Number_of_Shares»
    Shares
	Exercise
    Price Per Share	«Exercise_Price_per_Share»
	Type
    of Option (check one)	[  ]
                                         NSO

        [  ]
        ISO

	Vesting
    Commencement Date	«Vesting_Commencement_Date»
	Vesting
    Schedule	The
                                         Options granted hereunder shall vest in accordance with the following schedule: _________________________.

         

	Term
    of Option	The
    Option will expire 10 years from the Grant Date1, unless terminated earlier as provided in the Option Agreement.


 


By
their signatures below, the Company and the Optionee agree that the Option is subject to this Option Agreement, including the
Additional Terms and Conditions (the “Terms”) attached hereto and incorporated herein as part of this Option
Agreement, and the provisions of the Plan. In the event there is a conflict or inconsistency between any provision in this Option
Agreement and one or more provisions of the Plan, the provisions of the Plan shall govern. Capitalized terms used in this Option
Agreement that are not otherwise defined herein shall have the same meanings as defined in the Plan. The Optionee acknowledges
receipt of copies of both this Option Agreement (including the Terms) and the Plan, and hereby accepts the Option subject to all
of their terms and conditions.


 


	OPTIONEE
	 	COMPANY



	«First_Name»
    «Last_Name»	 	Qualigen Therapeutics, Inc.
	 	 	 	 
		 	By:	              
	Signature	 	 	 
	 	 	 	 
	Date:
_____________________________________	 	Date:
	_____________________________________
	 	 	 	 
	Address:
__________________________________	 	Address: 2042 Corte Del Nogal
	__________________________________________	 	Carlsbad, CA 92011


 


Attachments:
Additional Terms and Conditions; Notice of Exercise of Stock Option; Qualigen Therapeutics, Inc. 2020 Stock Incentive Plan.


 





 









1
If Optionee is a Ten Percent Stockholder as of the Grant Date, and the Option is an ISO, the Option will expire five years
from the Grant Date, unless terminated earlier as provided in the Option Agreement.

 




    	 



    	 



    

 


Additional
Terms and Conditions


 


The
terms and conditions set forth below constitute part of the Stock Option Agreement to which they are attached, and references
herein to the “Option Agreement” include both documents as one agreement.


 


1. Grant
of Option. The Company has granted to the Optionee an Option to purchase all or any portion of the number of Shares
at the exercise price per share (the “Exercise Price”) stated on the first page of this Option Agreement.
If the box marked “ISO” on the first page hereof is checked, then this Option is intended to qualify as an
“incentive stock option” as defined in Section 422 of the Internal Revenue Code of l986, as amended (the
“Code”). If this Option fails in whole or in part to qualify as an incentive stock option, or if the box
marked “NSO” on the first page hereof is checked, then this Option shall to that extent constitute a nonqualified
stock option.


 


2. Vesting
of Option. The right to exercise this Option shall vest and become exercisable as set forth on the first page of this
Option Agreement. No additional Shares shall vest after the date of termination of Optionee’s Service, but this Option
shall continue to be exercisable in accordance with Section 3 hereof with respect to that number of Shares that have vested
as of the date of termination of Optionee’s Service.


 


3. Term
of Option. The right of the Optionee to exercise this Option shall terminate upon the first to occur of the
following:


 


(a)
the expiration of 10 years from the Grant Date;2


 


(b)
the expiration of one year from the date of termination of Optionee’s Service if such termination is due to Disability
of the Optionee;


 


(c)
the expiration of one year from the date of termination of Optionee’s Service if such termination is due to Optionee’s
death or if death occurs during either the three-month or 30 day period following termination of Optionee’s Service pursuant
to Section 3(d) or 3(e) below, as the case may be;


 


(d)
the expiration of three months from the date of termination of Optionee’s Service if such termination occurs for any
reason other than Disability, death, voluntary resignation or Cause; provided, however, that if Optionee dies during such three-month
period the provisions of Section 3(c) above shall apply;


 


(e)
the expiration of 30 days from the date of termination of Optionee’s Service if such termination occurs due to voluntary
resignation; provided, however, that if Optionee dies during such 30 day period the provisions of Section 3(c) above shall apply;


 


(f)
the termination of Optionee’s Service, if such termination is for Cause; or


 


(g)
upon the consummation of a Corporate Transaction, unless otherwise provided pursuant to Section 8 below.


 





 






2
If Optionee is a Ten Percent Stockholder as of the Grant Date, and to the extent that the Option is an ISO the Option will
expire five years from the Grant Date.


 




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4.
Exercise of Option.


 


(a)
General. On or after the vesting of any portion of this Option in accordance with Sections 2 or 8 hereof, and until termination
of the right to exercise this Option in accordance with Section 3 above, the portion of this Option that has vested may be exercised
in whole or in part by the Optionee (or, after his or her death, by the person designated pursuant to Section 5 below) upon delivery
of the following to the Company at its principal executive offices:


 


(i)
Notice of Exercise of Stock Option, in the form attached as Exhibit A to this Option Agreement, which identifies
this Option Agreement, states the number of Shares then being purchased, and sets forth the investment intent of the Optionee
or person designated pursuant to Section 5 below, as the case may be;


 


(ii)
payment of the total Exercise Price for the Shares being purchased in accordance with Section 4(b) below; and


 


(iii)
payment of any applicable withholding taxes in accordance with Section 4(c) below.


 


(b)
Payment of Exercise Price. Subject to the approval of the Committee at the time of exercise and restrictions under applicable
law, the Optionee may elect to pay the Exercise Price by any of the following methods of payment:


 


(i)
cash or check;


 


(ii)
a “net exercise” arrangement pursuant to which the Company will reduce the number of Shares to be issued upon
exercise by the number of Shares having an aggregate Fair Market Value as of the date of exercise equal to the total Exercise
Price. The Shares used to pay the Exercise Price under this “net exercise” provision shall be considered to have resulted
from the exercise of this Option, and accordingly, this Option will not again be exercisable with respect to such Shares, as well
as any Shares actually delivered to Optionee;


 


(iii)
delivery of Shares already owned by Optionee having an aggregate Fair Market Value as of the date of exercise equal to the
total Exercise Price. “Delivery” for these purposes, in the sole discretion of the Committee at the time of exercise,
shall include delivery to the Company of the certificate(s) representing the Shares or Optionee’s attestation of ownership
of such Shares in a form approved by the Committee;


 


(iv)
such other form of consideration as may be approved by the Committee from time to time to the extent permitted by applicable
law; or


 


(v)
any combination of the foregoing.


 


(c)
Withholding. At the time of exercise of this Option, Optionee shall deliver to the Company a check or cash in the amount reasonably
requested by the Company to satisfy the Company’s withholding obligations under federal, state or other applicable tax laws
with respect to the taxable income, if any, recognized by the Optionee in connection with the exercise of this Option, unless
the Company and Optionee shall have made other arrangements for deductions or withholding from Optionee’s wages, bonus or
other compensation payable to Optionee, or by reduction of the number of Shares to be issued upon exercise of this Option or the
delivery of Shares already owned by Optionee (so long as such withholding will not result in adverse accounting consequences to
the Company), provided such arrangements satisfy the requirements of applicable law.


 




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5.
Death of Optionee; No Assignment. The rights of the Optionee under this Option Agreement may not be assigned or transferred
except by will, the laws of descent and distribution or pursuant to a domestic relations order, and may be exercised during the
lifetime of the Optionee only by such Optionee. Any attempt to sell, pledge, assign, hypothecate, transfer or dispose of this
Option in contravention of this Option Agreement or the Plan shall be void and shall have no effect. If the Optionee’s Service
terminates as a result of his or her death, and provided Optionee’s rights hereunder shall have vested pursuant to Section
2 hereof, Optionee’s legal representative, his or her legatee, or the person who acquired the right to exercise this Option
by reason of the death of the Optionee (individually, a “Successor”) shall succeed to the Optionee’s
rights and obligations under this Option Agreement. After the death of the Optionee, only a Successor may exercise this Option.


 


6.
Representations and Warranties of Optionee.


 


(a)
Shares May Be Unregistered. Optionee acknowledges that the Company may issue Shares upon the exercise of the Option
without registering such Shares under the Securities Act, on the basis of certain exemptions from such registration requirement.
IN SUCH EVENT:


 


(i)
Optionee agrees that his or her exercise of the Option may be expressly conditioned upon his or her delivery to the Company
of an investment certificate including such representations and undertakings as the Company may reasonably require in order to
assure the availability of such exemptions, including a representation that Optionee is acquiring the Shares for investment and
not with a present intention of selling or otherwise disposing thereof and an agreement by Optionee that the certificates evidencing
the Shares may bear a legend indicating such non-registration under the Securities Act and the resulting restrictions on transfer.


 


(ii)
Optionee acknowledges that, because Shares received upon exercise of an Option may be unregistered, Optionee may be required
to hold the Shares indefinitely unless they are subsequently registered for resale under the Securities Act or an exemption from
such registration is available.


 


(iii)
Option is familiar with the restrictions and risks of Rule 144 promulgated under the Securities Act.


 


(iv)
Optionee acknowledges that federal securities laws and the securities laws of the state in which he or she resides may require
the placement of certain restrictive legends upon the Shares issued upon exercise of this Option.


 


(b)
Agrees to Terms of the Plan. Optionee has received a copy of the Plan and has read and understands the terms of the
Plan and this Option Agreement, and agrees to be bound by their terms and conditions. Optionee understands that all rights and
obligations connected with this Option are set forth in this Option Agreement and in the Plan.


 




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(c)
Tax Consequences. Optionee acknowledges that there may be adverse tax consequences upon exercise of this Option or
disposition of the Shares, and that Optionee should consult a tax adviser before such exercise or disposition. Optionee acknowledges
that the Exercise Price has been determined by the Committee based upon the best evidence available to the Committee and is intended
to equal the Fair Market Value of the Shares as of the date of grant, or in some cases 110% of Fair Market Value, as required
by the Code. However, the tax treatment of this Option is not guaranteed. Optionee agrees to bear the entire risk of adverse tax
consequences if this Option Agreement is later determined to be have been granted at below Fair Market Value and acknowledges
and agrees that neither the Company, the Committee nor any of their designees shall be liable for any taxes, penalties or other
monetary amounts owed by the Optionee, employee, beneficiary or other person as a result of the grant, amendment, modification,
exercise and/or payment of, or under, this Option Agreement, notwithstanding any challenge made to the determination of Fair Market
Value by any taxing authority. Optionee represents that before purchase or disposition of the Shares, Optionee will consult with
his/her own tax advisor who Optionee deems advisable in connection with the purchase or disposition of the Shares and Optionee
is not relying on the Company for any tax advice. Optionee will not be permitted to exercise this Option unless Optionee has made
arrangements acceptable to the Company to pay any withholding taxes that may be due as a result of the Option exercise. If Optionee
sells or otherwise disposes of any of the Shares acquired pursuant to an ISO on or before the later of (i) two years after the
Grant Date, or (ii) one year after the date such ISO is exercised, Optionee shall immediately notify the Company in writing of
such disposition. Optionee agrees that Optionee may be subject to income tax withholding by the Company on the compensation income
recognized from such early disposition of Shares acquired pursuant to an ISO by payment in cash or out of the current compensation
paid to Optionee.


 


(d)
Personal Data. Optionee acknowledges and agrees to the collection, use and transfer, in electronic or other form, of
Optionee’s personal data in order to implement, administer and manage the Plan. Optionee acknowledges that the Company holds
certain personal information regarding the Optionee (including, but not limited to, name, home address and telephone number, date
of birth, social security or insurance number or other identification number, salary, nationality, job title, any shares of stock
or directorships held in the Company, details of all Awards or any other entitlement to Shares awarded, cancelled, purchased,
exercised, vested, unvested or outstanding in Optionee’s favor (“Data”). Optionee acknowledges that the
Data may be transferred to any third-parties assisting in the implementation, administration and management of the Plan, that
third-parties may be located in the United States or elsewhere. Optionee authorizes recipients of the Data to receive, possess,
use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing Optionee’s
participation in the Plan, including any requisite transfer of such Data, as may be required to a broker or other third party
with whom Optionee may elect to deposit any Shares acquired under the Plan. Optionee understands that the Data will be held only
as long as is necessary to implement, administer and manage participation in the Plan. Optionee understands that he/she may view
his/her Data, request additional information about the storage and processing of the Data, require any necessary amendments to
the Data or refuse or withdraw the consents herein, in any case without cost, by contacting the Company in writing. Optionee understands
that refusing or withdrawing consent may affect Optionee’s ability to participate in the Plan.


 




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7. Adjustments
Upon Changes in Capital Structure. In the event that the outstanding shares of Common Stock of the Company are hereafter
increased or decreased or changed into or exchanged for a different number or kind of shares or other securities of the Company
by reason of a recapitalization, stock split, combination of shares, reclassification, stock dividend or other change in the capital
structure of the Company, then appropriate adjustment shall be made by the Committee to the number of Shares subject to the unexercised
portion of this Option and to the Exercise Price per share, in order to preserve, as nearly as practical, but not to increase,
the benefits of the Optionee under this Option, in accordance with the provisions of Section 3.5 of the Plan. Notwithstanding
anything in this Option Agreement to the contrary, (a) any adjustments made pursuant to this Section 7 to Options that are considered
“deferred compensation” within the meaning of Section 409A of the Code shall be made in compliance with the requirements
of Section 409A of the Code; (b) any adjustments made pursuant to this Section 10 to Options that are not considered “deferred
compensation” subject to Section 409A of the Code shall be made in such a manner as to ensure that after such adjustment
the Options either (i) continue not to be subject to Section 409A of the Code or (ii) comply with the requirements of Section
409A of the Code; and (c) in any event, the Committee shall not have the authority to make any adjustments pursuant to this Section
7 to the extent the existence of such authority would cause an Option that is not intended to be subject to Section 409A of the
Code at the time of grant to be subject thereto.


 


8. Corporate
Transaction. In the event of a Corporate Transaction:


 


(a) The
right to exercise this Option shall accelerate automatically and vest in full (notwithstanding the provisions of Section 2 above)
effective as of immediately before the consummation of the Corporate Transaction unless this Option is to be assumed by the acquiring
or successor entity (or parent or subsidiary thereof) or new options under a new stock incentive program (“New Incentives”)
of comparable value are to be issued in exchange therefor, as provided in subsection (b) below. If vesting of this Option will
accelerate pursuant to the preceding sentence, the Committee in its discretion may provide, in connection with the Corporate Transaction,
for the purchase or exchange of this Option for an amount of cash or other property having a value equal to the difference (or
“spread”) between: (x) the value of the cash or other property that the Optionee would have received pursuant
to the Corporate Transaction in exchange for the Shares issuable upon exercise of this Option had this Option been exercised immediately
before the Corporate Transaction, and (y) the aggregate Exercise Price for such Shares. If the vesting of this Option will accelerate
pursuant to this subsection (a), then the Committee shall cause written notice of the Corporate Transaction to be given to the
Optionee not less than 15 days before the anticipated effective date of the proposed transaction.


 


(b) The
vesting of this Option shall not accelerate if and to the extent that: (i) this Option (including the unvested portion thereof)
is to be assumed by the acquiring or successor entity (or parent or subsidiary thereof) pursuant to the terms of the Corporate
Transaction, or (ii) this Option (including the unvested portion thereof) is to be replaced by the acquiring or successor entity
(or parent or subsidiary thereof) with New Incentives of comparable value containing such terms and provisions as the Committee
in its discretion may consider equitable. If this Option is assumed, or if New Incentives of comparable value are issued in exchange
therefor, then this Option or the New Incentives shall be appropriately adjusted, concurrently with the Corporate Transaction,
to apply to the number and class of securities or other property that the Optionee would have received pursuant to the Corporate
Transaction in exchange for the Shares issuable upon exercise of this Option had this Option been exercised immediately before
the Corporate Transaction, and appropriate adjustment also shall be made to the Exercise Price such that the aggregate Exercise
Price of this Option or the New Incentives shall remain the same as nearly as practicable.


 


(c) If
the provisions of subsection (b) above apply, then this Option or the New Incentives, as the case may be, shall continue to vest
in accordance with the provisions of Section 2 hereof and shall continue in effect for the remainder of the term of this Option
in accordance with the provisions of Section 3 hereof. However, in the event of an Involuntary Termination (as defined below)
of Optionee’s Continuous Service within 12 months following such Corporate Transaction, then vesting of this Option or the
New Incentives, as the case may be, shall accelerate in full automatically effective upon such Involuntary Termination.


 






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For
purposes of this Section 8, the following terms shall have the meanings set forth below:


 


(i) “Involuntary
Termination” shall mean the termination of Optionee’s Continuous Service by reason of:


 


(A) Optionee’s
involuntary dismissal or discharge by the Company, or by the acquiring or successor entity (or parent or any subsidiary thereof
employing the Optionee) for reasons other than Cause, or


 


(B) Optionee’s
voluntary resignation following (x) a change in Optionee’s position with the Company, the acquiring or successor entity
(or parent or any subsidiary thereof) which materially reduces Optionee’s duties and responsibilities or the level of management
to which Optionee reports, (y) a reduction in Optionee’s level of compensation (including base salary, fringe benefits and
target bonus under any performance based bonus or incentive programs) by more than 10%, or (z) a relocation of Optionee’s
principal place of employment by more than 30 miles, provided and only if such change, reduction or relocation is effected without
Optionee’s written consent.


 


9. Limitation
of Company’s Liability for Nonissuance. The Company agrees to use its reasonable best efforts to obtain from any
applicable regulatory agency such authority or approval as may be required in order to issue and sell the Shares to the Optionee
pursuant to this Option. Inability of the Company to obtain, from any such regulatory agency, authority or approval deemed by
the Company’s counsel to be necessary for the lawful issuance and sale of the Shares hereunder and under the Plan shall
relieve the Company of any liability in respect of the nonissuance or sale of such shares as to which such requisite authority
or approval shall not have been obtained.


 


10. No
Retention Rights. Nothing in this Option Agreement shall obligate the Company or any Affiliate, or their respective stockholders,
directors, officers or employees, to continue any relationship that Optionee might have as a Director, Employee or Consultant
of the Company. The right of the Company or any Affiliate to terminate at will Optionee’s employment at any time (whether
by dismissal, discharge or otherwise), with or without Cause, is specifically reserved. Moreover, the Optionee acknowledges and
agrees that the vesting of right to exercise the Option pursuant to this Option Agreement is earned only by continuing service
as a service provider at will. The Optionee further acknowledges and that this Option Agreement, the transactions contemplated
hereunder and the vesting schedule, if any, do not constitute an express or implied promise of continued employment or engagement
as a service provider for the vesting period, or for any period at all, and shall not interfere with the Optionee’s right
or the Company’s or Affiliate’s right to terminate the Optionee’s relationship with the Company or Affiliate
at any time, with or without Cause or notice.


 


11. Rights
as Stockholder. The Optionee (or transferee of this option by will or by the laws of descent and distribution) shall have
no rights as a stockholder with respect to any Shares covered by this Option until such person has duly exercised this Option,
paid the Exercise Price and become a holder of record of the Shares purchased.


 






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12. Interpretation.
This Option is granted pursuant to the terms of the Plan, and shall in all respects be interpreted in accordance therewith. To
the extent of any conflict or ambiguity between the terms of the this Option Agreement and the Plan, the terms of the Plan shall
govern, and the Committee shall interpret and construe this Option Agreement and the Plan, and any action, decision, interpretation
or determination made in good faith by the Committee shall be final and binding on the Company and the Optionee.


 


13. Notices.
Any notice, demand, offer, request or other communication required or permitted to be given by either the Company or the Optionee
pursuant to the terms of this Option Agreement shall be in writing and shall be deemed effectively given the earliest of (a) when
received, (b) when delivered personally, (c) one business day after being deposited with an overnight courier service for overnight
delivery, or (e) four days after being deposited in the U.S. mail, First Class with postage prepaid and return receipt requested,
and addressed to the parties at the addresses provided to the Company (which the Company agrees to disclose to the other parties
upon request) or such other address as a party may request by notifying the other in writing.


 


14. Governing
Law. The validity, construction, interpretation, and effect of this Option shall be governed by and determined in accordance
with the laws of the State of Delaware.


 


15. Severability.
Should any provision or portion of this Option Agreement be held to be unenforceable or invalid for any reason, the remaining
provisions and portions of this Option Agreement shall be unaffected by such holding.


 


16. Attorneys’
Fees. If any party shall bring an action in law or equity against another to enforce or interpret any of the terms, covenants
and provisions of this Option Agreement, the prevailing party in such action shall be entitled to recover reasonable attorneys’
fees and costs.


 


17. Counterparts.
This Option Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall
be deemed one instrument.


 


18. Reliance
on Counsel and Advisors. The Optionee acknowledges that he or she has had the opportunity to review this Option Agreement,
including all attachments hereto, and the transactions contemplated by this Option Agreement with his or her own legal counsel,
tax advisors and other advisors. The Optionee is relying solely on his or her own counsel and advisors and not on any statements
or representations of the Company or its agents for legal or other advice with respect to this investment or the transactions
contemplated by this Option Agreement.


 


19. 409A
Waiver. Optionee agrees to all terms and conditions as described in the waiver attached in Exhibit B, which
is incorporated into this Option Agreement by this reference.


 






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EXHIBIT
A


 


NOTICE
OF EXERCISE OF


 


STOCK
OPTION


 


Name
of Optionee: _________________


 


Qualigen
Therapeutics, Inc.


____________________ 


____________________ 


Attention:
_____________


 


Ladies
and Gentlemen:


 


I
hereby exercise my option (the “Option”) to purchase shares of Common Stock, $0.001 par value per share (the
“Shares”), of Qualigen Therapeutics, Inc., a Delaware corporation (the “Company”), pursuant
to the Stock Option Agreement, dated _____________, 202_, granted to me under the Company’s 2020 Stock Incentive Plan. The
number of Shares that I am purchasing at this time is set forth below, and my check payable to the Company in the amount of the
Total Exercise Price is enclosed with this Notice of Exercise:


 





	Number
    of Shares purchased hereby:	 	 		 
	Exercise Price per
    Share:	 	$		 
	Total Exercise Price:	 	$		 





 


In
connection with the exercise of my Option, I hereby represent to the Company that I acknowledge receipt of all information as
I deem necessary and appropriate to enable me to evaluate the merits and risks of my investment in the Shares, including information
concerning the business and financial condition of the Company, and that I have had the opportunity to discuss such information
with, and ask questions of, an officer of the Company.


 


	 	 
		«First_Name»
«Last_Name» (Signature)
	 	 
	 	 
	 	Date




 






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EXHIBIT
B


 


CODE
SECTION 409A WAIVER AND RELEASE


 


THIS
WAIVER AND RELEASE (“Waiver”) is made as of the date set forth above by the Optionee holding an option to purchase
shares of Common Stock, $0.001 par value per share (the “Shares”) of Qualigen Therapeutics, Inc., a Delaware
corporation (the “Company”), pursuant to the Stock Option Agreement to which this Exhibit B is attached,
granted under the Company’s 2020 Stock Incentive Plan (the “Plan”).


 


All
capitalized terms in this Waiver shall have the meaning assigned to them in the Plan.


 


Optionee
hereby agrees and acknowledges that the Board has taken reasonable steps to value the Shares and to set the Exercise Price at
the Fair Market Value per share of Shares on the Grant Date so that the Option will not be treated as an item of deferred compensation
subject to Code Section 409A.
Were the Internal Revenue Service to conclude that the Exercise Price is in fact less than such fair market value and that the
Option is accordingly subject to Code Section 409A, then Optionee would be subject to the following adverse tax consequences:


 


(i) As
the Option vests in accordance with the vesting schedule, Optionee would immediately recognize taxable income for federal income
tax purposes equal to the amount by which the fair market value of the Shares with respect to which the Option vests at that time
exceeds the Exercise Price payable for those shares. The Company would also have to collect from Optionee the federal income and
employment taxes which must be withheld on that income. Taxation would occur in this manner even though the Option remains unexercised.


 


(ii) Optionee
may also be subject to additional income taxation and withholding taxes on any subsequent increases to the fair market value of
the Shares purchasable under the vested Option until the Option is exercised or cancelled as to those shares.


 


(iii) In
addition to normal income taxes payable as the Option vests, Optionee would also be subject to a federal tax penalty equal to
20% and a California tax penalty (if applicable) equal to 5% of the amount of income Optionee recognizes under Code Section 409A
when the Option vests and may also be subject to such penalty as the underlying shares subsequently increase in fair market value
for the period the Option continues to remain outstanding.


 


(iv) There
will also be interest penalties if the resulting taxes are not paid on a timely basis.


 


Optionee
hereby further agrees and acknowledges that Optionee will accept the risk of any unfavorable tax consequences under the laws of
the state where the Optionee resides.


 


Optionee
hereby agrees to bear the entire risk of such adverse federal and state tax consequences in the event the Option is deemed to
be subject to Code Section 409A and hereby knowingly and voluntarily, in consideration for the grant of the Option, waives and
releases any and all claims or causes of action that Optionee might otherwise have against the Company and/or its Board, officers,
employees or stockholders arising from or relating to the tax treatment of the Option under Code Section 409A and the corresponding
provisions of any applicable state income tax laws and shall not seek any indemnification or other recovery of damages against
the Company and/or its Board, officers, employees or stockholders with respect to any adverse federal and State tax consequences
or other related costs and expenses Optionee may in fact incur under Code Section 409A (or the corresponding provisions of State
income tax laws) as a result of the Option.


 






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