Exhibit
10.1


 


INCENTIVE
STOCK OPTION AGREEMENT


 


pursuant
to the


 


Plastic2Oil
Inc. 


2012
LONG-TERM INCENTIVE PLAN


 


*
* * * *


 


Optionee:
Rahoul S. Banerjea


Grant
Date: October 25, 2016


 


Per
Share Exercise Price: $0.05


 


Number
of Option Shares subject to this Option: 3,000,000


 


*
* * * *


 


THIS
INCENTIVE STOCK OPTION AGREEMENT (this “Agreement”), dated as of the Grant Date specified above, is entered into by
and between Plastic2Oil Inc. f/k/a JBI, Inc., a Nevada corporation (the “Company”), and the Optionee specified above,
pursuant to the Plastic2Oil, Inc. f/k/a JBI, Inc. 2012 Long-Term Incentive Plan, as in effect and as amended from time to time
(the “Plan”); and


 


WHEREAS,
it has been determined under the Plan that it would be in the best interests of the Company to grant the incentive stock option
provided for herein to the Optionee.


 


NOW,
THEREFORE, in consideration of the mutual covenants and premises hereinafter set forth and for other good and valuable consideration,
the parties hereto hereby mutually covenant and agree as follows:


 


1.Incorporation
By Reference; Plan Document Receipt. This Agreement is subject in all respects to the terms and provisions of the Plan
(including, without limitation, any amendments thereto adopted at any time and from time to time unless such amendments are expressly
intended not to apply to the grant of the option hereunder), all of which terms and provisions are made a part of and incorporated
in this Agreement as if they were each expressly set forth herein. Any capitalized term not defined in this Agreement shall have
the same meaning as is ascribed thereto under the Plan. The Optionee hereby acknowledges receipt of a true copy of the Plan and
that the Optionee has read the Plan carefully and fully understands its content. In the event of any conflict between the terms
of this Agreement and the terms of the Plan, the terms of the Plan shall control.


 




    	 	 	 



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2.Grant
of Option. The Company hereby grants to the Optionee, as of the Grant Date specified above, an incentive stock option
(this “Option”) to acquire from the Company at the Per Share Exercise Price specified above the aggregate number of
shares of the Common Stock specified above (the “Option Shares”). This Option is to be treated as (and is intended
to qualify as) an Incentive Stock Option (an “ISO”) within the meaning of Section 422 of the Code. However, notwithstanding
such designation, if the Optionee becomes eligible in any given year to exercise ISOs for Common Stock having a Fair Market Value
in excess of $100,000, those options representing the excess shall be treated as Non-Qualified Stock Options. For the purpose
of deciding which options apply to Common Stock that exceed the $100,000 limit, ISOs shall be taken into account in the same order
as granted. The Fair Market Value of the Common Stock shall be determined as of the time the option with respect to such Common
Stock is granted. Optionee hereby acknowledges that there is no assurance that this Option will, in fact, be treated as an ISO
under Section 422 of the Code.


 


3.No
Dividends Equivalents. The Optionee shall not be entitled to receive a cash payment in respect of the Option Shares underlying
this Option on any dividend payment date for the Common Stock.


 


4.Exercise
of this Option.


 


4.1
Unless otherwise provided in Section 4.4 below or determined by the Committee, this Option shall become exercisable in accordance
with and to the extent provided by the terms and provisions of Section 6.5 of the Plan.


 


4.2Unless
earlier terminated in accordance with the terms and provisions of the Plan and/or this Agreement, this Option shall expire and
shall no longer be exercisable after the expiration of the lesser of (a) ten (10) years, measured from the date immediately preceding
the date on which the Option was granted, or (b) with respect to any Option Shares, seven (7) years from the applicable vesting
date as set forth in Section 4.4 hereof ( the “Option Period”).


 


4.3
In no event shall this Option be exercisable for a fractional share of Common Stock.


 


4.4
This Option shall be exercisable according to the following vesting schedule: (i) 1,000,000 Option Shares shall vest on March
18, 2017; (2) 1,000,000 Option Shares shall vest on March 18, 2018 and (3) 1,000,000 Option Shares shall vest on March 18, 2019
provided, however, that upon a Change in Control of the Company, the Option Shares will vest immediately.


 




    	 	 	 



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5.
Method of Exercise and Payment. This Option shall be exercised by the Optionee by delivering to the Secretary of
the Company or his designated agent on any business day (the “Exercise Date”) a written notice, in such manner and
form as may be required by the Company, specifying the number of the Option Shares the Optionee then desires to acquire (the “Exercise
Notice”). The Exercise Notice shall be accompanied by payment of the aggregate Per Share Exercise Price for such number
of the Option Shares to be acquired upon such exercise. Such payment shall be made in the manner set forth in Section 6.5 of the
Plan.


 


6.Termination.


 


6.1If
the Optionee’s employment with the Company and/or one of its Subsidiaries terminates for “Cause” or without
“Good Reason” (as those terms are defined hereinbelow), any then unexercisable portion of this Option shall be forfeited
and cancelled by the Company and the Optionee’s rights, if any, to exercise any then exercisable portion of this Option
shall terminate ninety (90) days after the date of such termination, but not beyond the expiration of the Option Period, and thereafter
such Option shall be forfeited and cancelled by the Company.


 


6.2If
the Optionee’s employment with the Company and/or its Subsidiaries terminates for Good Reason, then the Optionee shall immediately
vest in any Option Shares scheduled to vest within twelve (12) months following the date of such termination. Immediately following
such accelerated vesting, any remaining then unexercisable portion of this Option shall be forfeited and cancelled by the Company
and the Optionee’s rights, if any, to exercise any then exercisable portion of this Option shall terminate ninety (90) days
after the date of such termination, but not beyond the expiration of the Option Period, and thereafter such Option shall be forfeited
and cancelled by the Company.


 


6.3If
the Optionee’s employment with the Company and/or its Subsidiaries terminates without Cause, then the Optionee shall immediately
vest in all outstanding Option Shares and the Optionee’s rights, if any, to exercise any then exercisable portion of this
Option shall terminate at the expiration of the Option Period as noted in 4.4, and thereafter such Option shall be forfeited and
cancelled by the Company.


 


6.4If
Optionee’s termination of employment with the Company and/or its Subsidiaries is due to the Optionee’s death or disability,
then the Optionee shall immediately vest in any Option Shares scheduled to vest within twelve (12) months following the date of
such termination. Immediately following such accelerated vesting, the Optionee (or the Optionee’s estate, designated beneficiary
or other legal representative, as the case may be and as determined by the Committee) shall have the right, to the extent exercisable
after the date of such termination, to exercise this Option prior to the expiration of the Option Period as noted in 4.4 but not
beyond the expiration of the Option Period, and thereafter such Option shall be forfeited and cancelled by the Company.


 




    	 	 	 



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6.5The
Board or the Committee, in its sole discretion, may determine that all or any portion of this Option, to the extent exercisable
immediately prior to the Optionee’s termination of employment with the Company and/or its Subsidiaries for any reason, may
remain exercisable for an additional specified time period after the period specified above in this Section 6 expires (subject
to any other applicable terms and provisions of the Plan and this Agreement), but not beyond the expiration of the Option Period.


 


6.6If
the Optionee’s employer ceases to be a Subsidiary of the Company, that event shall be deemed to constitute a termination
of employment under Section 6.2 above.


 


7.Non-transferability.
This Option, and any rights or interests therein, shall not be sold, exchanged, transferred, assigned or otherwise disposed
of in any way at any time by the Optionee (or any beneficiary(ies) of the Optionee), other than by testamentary disposition by
the Optionee or the laws of descent and distribution. This Option shall not be pledged, encumbered or otherwise hypothecated in
any way at any time by the Optionee (or any beneficiary(ies) of the Optionee) and shall not be subject to execution, attachment
or similar legal process. Any attempt to sell, exchange, pledge, transfer, assign, encumber or otherwise dispose of or hypothecate
this Option, or the levy of any execution, attachment or similar legal process upon this Option, contrary to the terms of this
Agreement and/or the Plan shall be null and void and without legal force or effect. This Option shall be exercisable during the
Optionee’s lifetime only by the Optionee.


 


8.
Entire Agreement; Amendment. This Agreement contains the entire agreement between the parties hereto with respect
to the subject matter contained herein, and supersedes all prior agreements or prior understandings, whether written or oral,
between the parties relating to such subject matter. The Board or the Committee shall have the right, in its sole discretion,
to modify or amend this Agreement from time to time in accordance with and as provided in the Plan; provided, however,
that no such modification or amendment shall materially adversely affect the rights of the Optionee under this Option without
the consent of the Optionee. The Company shall give written notice to the Optionee of any such modification or amendment of this
Agreement as soon as practicable after the adoption thereof. This Agreement may also be modified or amended by a writing signed
by both the Company and the Optionee.


 


9.
Notices. Any Exercise Notice or other notice which may be required or permitted under this Agreement shall be in
writing, and shall be delivered in person or via facsimile transmission, overnight courier service or certified mail, return receipt
requested, postage prepaid, properly addressed as follows.


 


9.1
If such notice is to the Company, to the attention of the Secretary of Plastic2Oil, Inc., 20 Iroquois Street, Niagara Falls,
New York 14303, or at such other address as the Company, by notice to the Optionee, shall designate in writing from time to time.


 




    	 	 	 



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9.2
If such notice is to the Optionee, at his or her address as shown on the Company’s records, or at such other address
as the Optionee, by notice to the Company, shall designate in writing from time to time.


 


10.
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New
York, without reference to the principles of conflict of laws thereof.


 


11.
Compliance with Laws. The issuance of this Option (and the Option Shares upon exercise of this Option) pursuant
to this Agreement shall be subject to, and shall comply with, any applicable requirements of any federal and state securities
laws, rules and regulations (including, without limitation, the provisions of the Securities Act of 1933, the Exchange Act and
the respective rules and regulations promulgated thereunder) and any other law or regulation applicable thereto. The Company shall
not be obligated to issue this Option or any of the Option Shares pursuant to this Agreement if any such issuance would violate
any such requirements.


 


12.
Binding Agreement; Assignment. This Agreement shall inure to the benefit of, be binding upon, and be enforceable
by the Company and its successors and assigns. The Optionee shall not assign any part of this Agreement without the prior express
written consent of the Company.


 


13.
Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an
original, but all of which shall constitute one and the same instrument.


 


14.
Headings. The titles and headings of the various sections of this Agreement have been inserted for convenience
of reference only and shall not be deemed to be a part of this Agreement.


 


15.
Further Assurances. Each party hereto shall do and perform (or shall cause to be done and performed) all such further
acts and shall execute and deliver all such other agreements, certificates, instruments and documents as any party hereto reasonably
may request in order to carry out the intent and accomplish the purposes of this Agreement and the Plan and the consummation of
the transactions contemplated thereunder.


 


16.
Severability. The invalidity or unenforceability of any provisions of this Agreement in any jurisdiction shall
not affect the validity, legality or enforceability of the remainder of this Agreement in such jurisdiction or the validity, legality
or enforceability of any provision of this Agreement in any other jurisdiction, it being intended that all rights and obligations
of the parties hereunder shall be enforceable to the fullest extent permitted by law.


 




    	 	 	 



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17.
Certain Definitions.


 


17.1“Cause”
means the Company’s termination of the Optionee’s employment upon the occurrence of any of the following events:


 


	 	(a)	the
    Optionee’s conviction of any felony or crime involving moral turpitude;
	 	 	 
	 	(b)	the
    Optionee’s engaging or in any manner participating in any material act of intentional misconduct against the Company,
    or its employees, agents or customers, including but not limited to fraud or the use or appropriation for his personal use
    or benefit of any funds or properties of the Company not authorized by the Company’s Board of Directors to be so used
    or appropriated; or,
	 	 	 
	 	(c)	the
    Optionee’s refusal to implement or follow a lawful policy or directive of the Company following a written request or
    order to do so.


 


17.2“Good
Reason” shall mean the Optionee’s termination of his employment upon the occurrence of a material reduction in the
Optionee’s duties, authority, or responsibilities relative to the duties, authority, or responsibilities in effect immediately
prior to such reduction; provided, however , such termination by the Optionee shall only be deemed for Good Reason pursuant
to the foregoing definition if: (a) the Optionee gives the Company written notice of the intent to terminate for Good Reason within
thirty (30) days following the first notice to the Optionee of the occurrence of the condition(s) that the Optionee believes constitutes
Good Reason, which notice shall describe such condition(s); (b) the Company fails to remedy such condition(s) within sixty (60)
days following receipt of the written notice; and (c) any termination for Good Reason must take place within a one year period
following the Company’s failure to cure such conditions constituting Good Reason.


 


17.3“Change
in Control” means the consummation of one or a series of related transactions pursuant to which: (i) a Third Party (defined
below) acquires all or substantially all of the assets of the Company; (ii) a Third Party acquires more than 50% of the voting
securities of the Company; or (iii) a Third Party acquires the ability to appoint a majority of the Board of Directors of the
Company.


 


17.4“Third
Party” means a person or entity, or more than one person or entity acting as a group, who is not stockholder, parent,
or subsidiary of the Company or an affiliate of such person or entity.


 




    	 	 	 



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IN
WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly authorized officer, and the Optionee has hereunto
set his hand, all as of the Grant Date specified above.


 


	 	Plastic2Oil
    Inc.
	 	 	 
	 	By:	/s/
    Richard Heddle
	 	Name:	Richard
    Heddle 
	 	Title:	Chief
    Executive Officer & President 
	 	 	 
	 	/s/
    Rahoul S Banerjea
	 	Rahoul
    S. Banerjea