Exhibit 4.1


 





ERF
Wireless, Inc.


2013-A Stock Option Plan


(effective April 12, 2013)


 


ARTICLE I - PLAN


 


1.1Purpose.
This Plan is a plan for key employees, officers, directors, and consultants of the Company and its Affiliates and is intended to
advance the best interests of the Company, its Affiliates, and its stockholders by providing those persons who have substantial
responsibility for the management and growth of the Company and its Affiliates with additional incentives and an opportunity to
obtain or increase their proprietary interest in the Company, thereby encouraging them to continue in the employ of the Company
or any of its Affiliates.


 


1.2 Rule
16b-3 Plan. The Company is subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the
“1934 Act”), and therefore the Plan is intended to comply with all applicable conditions of Rule 16b-3 (and all subsequent
revisions thereof) promulgated under the 1934 Act. To the extent any provision of the Plan or action by the Board of Directors
or Committee fails to so comply, it shall be deemed null and void, to the extent permitted by law and deemed advisable by the Committee.
In addition, the Board of Directors may amend the Plan from time to time, as it deems necessary in order to meet the requirements
of any amendments to Rule 16b-3 without the consent of the shareholders of the Company.


 


1.3 Effective
Date of Plan. The Plan shall be effective April 12, 2013 (the “Effective Date”). No Award shall be granted
pursuant to the Plan more than ten years after the Effective Date.


 


ARTICLE II - DEFINITIONS


 


The words and phrases
defined in this Article shall have the meaning set out in these definitions throughout this Plan, unless the context in which any
such word or phrase appears reasonably requires a broader, narrower, or different meaning.


 


2.1 “Affiliate”
means any subsidiary corporation. The term “subsidiary corporation” means any corporation (other than the Company)
or other entity in an unbroken chain of corporations or other entities beginning with the Company if, at the time of the action
or transaction, each of the corporations or other entities other than the last corporation or other entity in the unbroken chain
owns a controlling interest in one of the other corporations or other entities in the chain. For this purpose, controlling interest
has the meaning provided in Final Treasury Regulation 1.409A-1(b)(5)(iii)(E)(1).


 


2.2 “Award” means each
of the following granted under this Plan: Incentive Option, Nonqualified Option, Stock Appreciation Right, Restricted Stock Award,
Performance Stock Award or Stock Award.


 


2.3 “Board
of Directors” means the board of directors of the Company.


 






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


 


2.5 “Committee”
means the Compensation Committee of the Board of Directors, or if no Compensation Committee has been formed, then it shall mean
the entire Board of Directors.


 


2.6 “Company”
means ERF Wireless, Inc., a Nevada corporation.


 


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


 


2.8 “Eligible
Persons” shall mean, with respect to the Plan, those persons who, at the time that an Award is granted, are (i) Employees
and all other key personnel, including officers and directors, of the Company or Affiliate, or (ii) Consultants or independent
contractors who provide valuable services to the Company or Affiliate as determined by the Committee.


 


2.9 “Employee”
means a common law employee of the Company or any Affiliate.


 


2.10 “Fair
Market Value” of the Stock as of any date means (a) the average of the high and low sale prices of the Stock on that date
on the principal securities exchange on which the Stock is listed; or (b) if the Stock is not listed on a securities exchange,
the average of the high and low bid quotations for the Stock on that date as reported by the National Quotation Bureau Incorporated
or other quotation system on which transactions in Stock are principally reported; or (c) if none of the foregoing is applicable,
an amount at the election of the Committee equal to (x), the average between the closing bid and ask prices per share of Stock
on the last preceding date on which those prices were reported or (y) that amount as determined by the Committee in good faith
in accordance with Code Section 409A and the guidance promulgated thereunder.


 


2.11 “Incentive
Option” means an option to purchase Stock granted under this Plan which is designated as an “Incentive Option”
and which is intended to satisfy the requirements of Section 422 of the Code.


 


2.12 “Non-Employee
Directors” means that term as defined in Rule 16b-3 under the 1934 Act.


 


2.13 “Nonqualified
Option” means an option to purchase Stock granted under this Plan other than an Incentive Option.


 


2.14 “Option”
means both an Incentive Option and a Nonqualified Option granted under this Plan to purchase shares of Stock.


 


2.15 “Option
Agreement” means the written agreement by and between the Company and an Eligible Person, which sets out the terms of an
Option.


 


2.16 “Outside
Director” shall mean a member of the Board of Directors serving on the Committee who satisfies Section 162(m) of the Code.


 


 



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2.17 “Plan” means
this ERF Wireless, Inc. 2013-A Stock Option Plan, as set out in this document and as it may be amended from time to time.


 


2.18 “Plan Year” means
the Company’s fiscal year.


 


2.19 “Performance Stock Award”
means an award denominated in shares of Stock to be issued to an Eligible Person if specified predetermined performance goals are
satisfied as described in Article VII.


 


2.20 “Restricted Stock”
means Stock awarded or purchased under a Restricted Stock Agreement entered into pursuant to this Plan, together with (i) all rights,
warranties or similar items attached or accruing thereto or represented by the certificate representing the stock and (ii) any
stock or securities into which or for which the stock is thereafter converted or exchanged. The terms and conditions of the Restricted
Stock Agreement shall be determined by the Committee consistent with the terms of the Plan.


 


2.21 “Restricted Stock Agreement”
means an agreement between the Company or any Affiliate and the Eligible Person pursuant to which the Eligible Person receives
a Restricted Stock Award subject to Article VI.


 


2.22 “Restricted Stock Award”
means an Award of Restricted Stock.


 


2.23 “Restricted Stock Purchase
Price” means the purchase price, if any, per share of Restricted Stock subject to an Award. The Committee shall determine
the Restricted Stock Purchase Price. It may be greater than or less than the Fair Market Value of the Stock on the date of the
Stock Award.


 


2.24 “Stock” means
the common stock of the Company, $.001 par value, or, in the event that the outstanding shares of common stock are later changed
into or exchanged for a different class of stock or securities of the Company or another corporation, that other stock or security.


 


2.25 “Stock Appreciation
Right” and “SAR” means the right to receive the difference between the Fair Market Value of a share of Stock
on the grant date and the Fair Market Value of the share of Stock on the exercise date.


 


2.26“Stock
Award” means an Award of Stock to an Eligible Person.


 


2.27 “10% Stockholder”
means an individual who, at the time the Option is granted, owns Stock possessing more than 10% of the total combined voting power
of all classes of stock of the Company or of any Affiliate, as determined for purposes of Code Sections 422 and 424.


 






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ARTICLE III - ELIGIBILITY


 


The individuals who
shall be eligible to receive Awards shall be those Eligible Persons of the Company or any of its Affiliates as the Committee shall
determine from time to time. However, no member of the Committee shall be eligible to receive any Award or to receive Stock, Options,
Stock Appreciation Rights, or any Performance Stock Award under any other plan of the Company or any of its Affiliates, if to do
so would cause the individual not to be a Non-Employee Director or Outside Director. The Board of Directors may designate one or
more individuals who shall not be eligible to receive any Award under this Plan or under other similar plans of the Company.


 


ARTICLE IV - GENERAL PROVISIONS
RELATING TO AWARDS


 


4.1 Authority to Grant Awards.
The Committee may grant to those Eligible Persons of the Company or any of its Affiliates, as it shall from time to time determine,
Awards under the terms and conditions of this Plan. The Committee shall determine subject only to any applicable limitations set
out in this Plan, the number of shares of Stock to be covered by any Award to be granted to an Eligible Person.


 


4.2 Dedicated Shares.
The total number of shares of Stock with respect to which Awards may be granted under the Plan shall be 1,000,000 shares. The shares
may be treasury shares or authorized but unissued shares. The number of shares stated in this Section 4.2 shall be subject to adjustment
in accordance with the provisions of Section 4.5. In the event that any outstanding Award shall expire or terminate for any reason
or any Award is surrendered, the shares of Stock allocable to the unexercised portion of that Award may again be subject to an
Award under the Plan. Shares withheld in order to cover tax withholding obligations shall reduce the number of shares of Stock
available for issuance under the Plan. The Committee may adopt reasonable counting procedures to ensure appropriate counting, avoid
double counting, and make adjustments pursuant to the Plan. Subject to adjustment as provided in Section 4.5, the maximum number
of shares that may be covered by Options or SARs (other than a substitution Award granted pursuant to Section 5.14) issued to an
Eligible Person in any calendar year shall not exceed 200,000 shares.


 


4.3 Non-transferability.
Awards shall not be transferable by the Eligible Person otherwise than by will or under the laws of descent and distribution, or
(with respect to Awards other than Incentive Options) pursuant to a qualified domestic relations order (as
defined by the Code or the rules thereunder), and shall be exercisable, during the Eligible Person’s lifetime, only
by him or a transferee permitted by this Section 4. Any attempt to transfer an Award other than under the terms of the Plan and
the Agreement shall terminate the Award and all rights of the Eligible Person to that Award.


 


4.4 Requirements of Law.
The Company shall not be required to sell or issue any Stock under any Award if issuing that Stock would constitute or result in
a violation by the Eligible Person or the Company of any provision of any law, statute, or regulation of any governmental authority.
Specifically, in connection with any applicable statute or regulation relating to the registration of securities, upon exercise
of any Option or pursuant to any Award, the Company shall not be required to issue any Stock unless the Committee has received
evidence satisfactory to it to the effect that the holder of that Option or Award will not transfer the Stock except in accordance
with applicable law, including receipt of an opinion of counsel satisfactory to the Company to the effect that any proposed transfer
complies with applicable law. The determination by the Committee on this matter shall be final, binding, and conclusive. The Company
may, but shall in no event be obligated to, register any Stock covered by this Plan pursuant to applicable securities laws of any
country or any political subdivision. In the event the Stock issuable on exercise of an Option or pursuant to an Award is not registered,
the Company may imprint on the certificate evidencing the Stock any legend that counsel for the Company considers necessary or
advisable to comply with applicable law. The Company shall not be obligated to take any other affirmative action in order to cause
the exercise of an Option or vesting under an Award, or the issuance of shares pursuant thereto, to comply with any law or regulation
of any governmental authority.


 


 






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4.5 Changes in the Company’s
Capital Structure. 


 


(a) The existence of outstanding
Options or Awards shall not affect in any way the right or power of the Company or its stockholders to make or authorize any or
all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business,
or any merger or consolidation of the Company, or any issue of bonds, debentures, preferred or prior preference stock ahead of
or affecting the Stock or its rights, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part
of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise. If the Company
shall effect a subdivision or consolidation of shares or other capital readjustment, the payment of a Stock dividend, or other
increase or reduction of the number of shares of the Stock outstanding, without receiving compensation for it in money, services
or property, then (a) the number, class, and per share price of shares of Stock subject to outstanding Options under this Plan
shall be appropriately adjusted in such a manner as to entitle an Eligible Person to receive upon exercise of an Option, for the
same aggregate cash consideration, the equivalent total number and class of shares he would have received had he exercised his
Option in full immediately prior to the event requiring the adjustment; (b) the applicable share limits under Article VII and the
number and class of shares of Stock then reserved to be issued under the Plan, shall each be adjusted by substituting for the total
number and class of shares of Stock at issue that number and class of shares of Stock that would have been received by the owner
of an equal number of outstanding shares of each class of Stock as the result of the event requiring the adjustment.


 


(b) If the Company is merged or
consolidated with another corporation and the Company is not the surviving corporation, or if the Company is liquidated or sells
or otherwise disposes of substantially all of its assets while Options remain outstanding under this Plan (each of the foregoing
referred to as a “Corporate Transaction”):


 


(i)Subject
to the provisions of clause (ii) below, in the event of such a Corporate Transaction, any unexercised Options shall automatically
accelerate so that they shall, immediately prior to the specified effective date for the Corporate Transaction become 100% vested
and exercisable; provided, however, that any unexercised Options shall not accelerate if and to the extent such Option is, in connection
with the Corporate Transaction, either to be assumed by the successor corporation or parent thereof (the “Successor Corporation”)
or to be replaced with a comparable award for the purchase of shares of the capital stock of the Successor Corporation or parent
thereof. Whether or not any unexercised Option is assumed or replaced shall be determined by the Company and the Successor Corporation
in connection with the Corporate Transaction. The Board of Directors shall make the determination of what constitutes a comparable
award to the unexercised Option, and its determination shall be conclusive and binding. The unexercised Option shall terminate
and cease to remain outstanding immediately following the consummation of the Corporate Transaction, except to the extent assumed
by the Successor Corporation.


 






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(ii) All
outstanding Options may be canceled by the Board of Directors as of the effective date of any Corporate Transaction, if (i) notice
of cancellation shall be given to each holder of an Option and (ii) either (x) the Company shall pay in cash to each holder of
an Option the excess (if any) of the value of the consideration received per share of Stock in the Corporate Transaction over the
exercise price per share of the Option (multiplied by the number of shares of Stock then subject to the Option), which amount may
be paid immediately upon the closing of the Corporate Transaction or may be paid subject to the same terms and conditions (such
as escrows, holdbacks, or earnouts) as is the consideration payable to the holders of Stock (provided that any such cash payment
or payments shall comply with the rules of Final Treasury Regulation Section 1.409A-3(i)(5)(iv)), or (y) each holder of an Option
shall have the right to exercise that Option in full (without regard to any limitations set out in or imposed under this Plan or
the Option Agreement granting that Option) during a period set by the Board of Directors preceding the effective date of the merger,
consolidation, liquidation, sale, or other disposition and, if in the event all outstanding Options may not be exercised in full
under applicable securities laws without registration of the shares of Stock issuable on exercise of the Options, the Board of
Directors may limit the exercise of the Options to the number of shares of Stock, if any, as may be issued without registration.
The method of choosing which Options may be exercised, and the number of shares of Stock for which Options may be exercised, shall
be solely within the discretion of the Board of Directors.


 


(c) After a merger of one or more
corporations into the Company or after a consolidation of the Company and one or more corporations in which the Company shall be
the surviving corporation, each Eligible Person shall be entitled to have his Restricted Stock and shares earned under a Performance
Stock Award appropriately adjusted based on the manner the Stock was adjusted under the terms of the agreement of merger or consolidation.


 


(d) In each situation
described in this Section 4.5, the Committee will make similar adjustments, as appropriate, in outstanding Stock Appreciation Rights.


 


(e) The issuance
by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, for cash or property,
or for labor or services either upon direct sale or upon the exercise of rights or warrants to subscribe for them, or upon conversion
of shares or obligations of the Company convertible into shares or other securities, shall not affect, and no adjustment by reason
of such issuance shall be made with respect to, the number, class, or price of shares of Stock then subject to outstanding Awards.


 






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4.6 Election
under Section 83(b) of the Code. No Employee shall exercise the election permitted under Section 83(b) of the Code without
written approval of the Committee. Any Employee doing so shall forfeit all Awards issued to him under this Plan.


 


4.7Book Entry.Notwithstanding any
other provision of this Plan to the contrary, the Company may elect to satisfy any requirement under this Plan for the delivery
of stock certificates through the use of electronic or other form of book-entry.


 


ARTICLE V - OPTIONS AND STOCK APPRECIATION
RIGHTS


 


5.1 Type of Option.
The Committee shall specify at the time of grant whether a given Option shall constitute an Incentive Option or a Nonqualified
Option. Incentive Stock Options may only be granted to Employees.


 


5.2 Option
Exercise Price. The price at which Stock may be purchased under an Incentive Option shall not be less than the greater
of: (a) 100% of the Fair Market Value of the shares of Stock on the date the Option is granted or (b) the aggregate par value of
the shares of Stock on the date the Option is granted. The Committee in its discretion may provide that the price at which shares
of Stock may be purchased under an Incentive Option shall be more than 100% of Fair Market Value. In the case of any 10% Stockholder,
the price at which shares of Stock may be purchased under an Incentive Option shall not be less than 110% of the Fair Market Value
of the Stock on the date the Incentive Option is granted. The price at which shares of Stock may be purchased under a Nonqualified
Option shall be such price as shall be determined by the Committee in its sole discretion but in no event lower than the par value
of the shares of Stock on the date the Option is granted; provided, however, that in the event that shares of Stock subject to
a Nonqualified Option are or may by the terms of the Option become purchasable at a price that is less than the Fair Market Value
of the shares of Stock on the date the Option is granted, such Option shall be subject to the provisions of Section 5.17 below
and shall be intended to comply with (as opposed to be exempt from) the requirements of Section 409A of the Code.


 


5.3 Duration
of Options and SARS. No Option or SAR shall be exercisable after the expiration of ten (10) years from the date the Option
or SAR is granted. In the case of a 10% Stockholder, no Incentive Option shall be exercisable after the expiration of five years
from the date the Incentive Option is granted.


 


5.4 Amount
Exercisable -- Incentive Options. Subject to the provisions of Section 5.17, each Option may be exercised from time to
time, in whole or in part, in the manner and subject to the conditions the Committee, in its sole discretion, may provide in the
Option Agreement, as long as the Option is valid and outstanding. To the extent that the aggregate Fair Market Value (determined
as of the time an Incentive Option is granted) of the Stock with respect to which Incentive Options first become exercisable by
the optionee during any calendar year (under this Plan and any other incentive stock option plan(s) of the Company or any Affiliate)
exceeds $100,000, the portion in excess of $100,000 of the Incentive Option shall be treated as a Nonqualified Option. In making
this determination, Incentive Options shall be taken into account in the order in which they were granted.


 






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5.5 Exercise
of Options. Each Option shall be exercised by the delivery of written notice to the Committee setting forth the number
of shares of Stock with respect to which the Option is to be exercised, together with:


 


(a) cash, certified check, bank
draft, or postal or express money order payable to the order of the Company for an amount equal to the option price of the shares;


 


(b) stock at its
Fair Market Value on the date of exercise (if approved in advance in writing by the Committee);


 


(c) an election to make a cashless
exercise through a registered broker-dealer (if approved in advance in writing by the Committee);


 


(d)an election
to have shares of Stock, which otherwise would be issued on exercise, withheld in payment of the exercise price (if approved in
advance in writing by the Committee); and/or


 


(e) any other form
of payment which is acceptable to the Committee, including without limitation, payment in the form of a promissory note, and specifying
the address to which the certificates for the shares are to be mailed.


 


As promptly as practicable
after receipt of written notification and payment, the Company shall deliver to the Eligible Person certificates for the number
of shares with respect to which the Option has been exercised, issued in the Eligible Person’s name. If shares of Stock are
used in payment, the aggregate Fair Market Value of the shares of Stock tendered must be equal to or less than the aggregate exercise
price of the shares being purchased upon exercise of the Option, and any difference must be paid by cash, certified check, bank
draft, or postal or express money order payable to the order of the Company. Delivery of the shares shall be deemed effected for
all purposes when a stock transfer agent of the Company shall have deposited the certificates in the United States mail, addressed
to the Eligible Person, at the address specified by the Eligible Person.


 


Whenever an Option
is exercised by exchanging shares of Stock owned by the Eligible Person, the Eligible Person shall deliver to the Company certificates
registered in the name of the Eligible Person representing a number of shares of Stock legally and beneficially owned by the Eligible
Person, free of all liens, claims, and encumbrances of every kind, accompanied by stock powers duly endorsed in blank by the record
holder of the shares represented by the certificates (with signature guaranteed by a commercial bank or trust company or by a brokerage
firm having a membership on a registered national stock exchange). The delivery of certificates upon the exercise of Options is
subject to the condition that the person exercising the Option provides the Company with the information the Company might reasonably
request pertaining to exercise, sale or other disposition. Notwithstanding the foregoing, to the extent approved by the Committee,
an Eligible Person may choose to deliver shares of Stock to the Company via any reasonable attestation process meeting the requirements
of the Code and other applicable law.


 






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5.6 Stock
Appreciation Rights. All Eligible Persons shall be eligible to receive Stock Appreciation Rights. The Committee shall determine
the SAR to be awarded from time to time to any Eligible Person. The grant of a SAR to be awarded from time to time shall neither
entitle such person to, nor disqualify such person from, participation in any other grant of Awards by the Company, whether under
this Plan or any other plan of the Company. If granted as a stand-alone SAR Award, the terms of the Award shall be provided in
a Stock Appreciation Rights Agreement.


 


5.7 Stock
Appreciation Rights in Tandem with Options. Stock Appreciation Rights may, at the discretion of the Committee, be included
in each Option granted under the Plan to permit the holder of an Option to surrender that Option, or a portion of the part which
is then exercisable, and receive in exchange, upon the conditions and limitations set by the Committee, an amount equal to the
excess of the Fair Market Value of the Stock covered by the Option, or the portion of it that was surrendered, determined as of
the date of surrender, over the aggregate exercise price of the Stock. In the event of the surrender of an Option, or a portion
of it, to exercise the Stock Appreciation Rights, the shares represented by the Option or that part of it which is surrendered,
shall not be available for reissuance under the Plan. Each Stock Appreciation Right issued in tandem with an Option (a) will expire
not later than the expiration of the underlying Option, (b) may be for no more than 100% of the difference between the exercise
price of the underlying Option and the Fair Market Value of a share of Stock at the time the Stock Appreciation Right is exercised,
(c) is transferable only when the underlying Option is transferable, and under the same conditions, and (d) may be exercised only
when the underlying Option is eligible to be exercised.


 


5.8 Conditions
of Stock Appreciation Rights. All Stock Appreciation Rights shall be subject to such terms, conditions, restrictions or
limitations as the Committee deems appropriate, including by way of illustration but not by way of limitation, restrictions on
transferability, requirement of continued employment, individual performance, financial performance of the Company, or payment
of any applicable employment or withholding taxes.


 


5.9 Payment
of Stock Appreciation Rights. The amount of payment to which the Eligible Person who reserves an SAR shall be entitled
upon the exercise of each SAR shall be equal to the amount, if any by which the Fair Market Value of the specified shares of Stock
on the exercise date exceeds the Fair Market Value of the specified shares of Stock on the date of grant of the SAR. The SAR shall
be paid in either cash or Stock, as determined in the discretion of the Committee as set forth in the SAR agreement. If the payment
is in Stock, the number of shares to be paid shall be determined by dividing the amount of such payment by the Fair Market Value
of Stock on the exercise date of such SAR.


 


5.10 Exercise
on Termination of Employment. Unless it is expressly provided otherwise in the Option or SAR agreement, Options and SAR’s
granted to Employees shall terminate three months after severance of employment of the Employee from the Company and all Affiliates
for any reason, with or without Cause (defined below), other than death, retirement under the then established rules of the Company,
or severance for disability. The Committee shall determine whether authorized leave of absence or absence on military or government
service shall constitute severance of the employment of the Employee at that time. Notwithstanding anything contained herein,
no Option or SAR may be exercised after termination of employment for any reason (whether by death, disability, retirement or otherwise)
if it has not vested as at the date of termination of employment. Cause shall mean any of the following: (A) conviction
of a crime (including conviction on a nolo contendere plea) involving a felony or dishonesty, or moral turpitude; (B) deliberate
and continual refusal to perform employment duties reasonably requested by the Company or an affiliate after thirty (30) days’
written notice by certified mail of such failure to perform, specifying that the failure constitutes cause (other than as a result
of vacation, sickness, illness or injury); (C) fraud or embezzlement as determined by an independent certified public accountant
firm; or (D) gross misconduct or gross negligence in connection with the business of the Company or an affiliate which has substantial
effect on the Company or the affiliate.


 






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5.11 Death. If, before
the expiration of an Option or SAR, the Eligible Person, whether in the employ of the Company or after he has retired or was severed
for disability, or otherwise dies, the Option or SAR may be exercised until the earlier of the Option’s or SAR’s expiration
date or six months following the date of his death, unless it is expressly provided otherwise in the Option or SAR agreement. After
the death of the Eligible Person, his executors, administrators, or any persons to whom his Option or SAR may be transferred by
will or by the laws of descent and distribution shall have the right, at any time prior to the Option’s or SAR’s expiration
or termination, whichever is earlier, to exercise it, to the extent to which he was entitled to exercise it immediately prior to
his death, unless it is expressly provided otherwise in the Option or SAR’s agreement.


 


5.12 Retirement.
Unless it is expressly provided otherwise in the Option Agreement, before the expiration of an Option or SAR, the Employee shall
be retired in good standing from the employ of the Company under the then established rules of the Company, the Option or SAR may
be exercised until the earlier of the Option’s or SAR’s expiration date or three months following the date of his retirement,
unless it is expressly provided otherwise in the Option or SAR agreement.


 


5.13 Disability.
If, before the expiration of an Option or SAR, the Employee shall be severed from the employ of the Company for disability, the
Option or SAR shall terminate on the earlier of the Option’s or SAR’s expiration date or six months after the date
he was severed because of disability, unless it is expressly provided otherwise in the Option or SAR agreement.


 


5.14 Substitution
Options. Options may be granted under this Plan from time to time in substitution for stock options held by employees of
other corporations who are about to become employees of or affiliated with the Company or any Affiliate as the result of a merger
or consolidation of the employing corporation with the Company or any Affiliate, or the acquisition by the Company or any Affiliate
of the assets of the employing corporation, or the acquisition by the Company or any Affiliate of stock of the employing corporation
as the result of which it becomes an Affiliate of the Company. The terms and conditions of the substitute Options granted may vary
from the terms and conditions set out in this Plan to the extent the Committee, at the time of grant, may deem appropriate to conform,
in whole or in part, to the provisions of the stock options in substitution for which they are granted. Any substitute Options
granted pursuant to this paragraph shall meet the requirements set forth in Final Treasury Regulation Sections 1.424-1 and 1.409A-1(b)(5)(v)(D),
as applicable.


 






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5.15 Reload
Options. Without in any way limiting the authority of the Board of Directors or Committee to make or not to make grants
of Options hereunder, the Board of Directors or Committee shall have the authority (but not an obligation) to include as part of
any Option Agreement a provision entitling the Eligible Person to a further Option (a “Reload Option”) in the event
the Eligible Person exercises the Option evidenced by the Option Agreement, in whole or in part, by surrendering other shares of
Stock in accordance with this Plan and the terms and conditions of the Option Agreement. Any such Reload Option (a) shall be for
a number of shares equal to the number of shares surrendered as part or all of the exercise price of such Option; (b) shall have
an expiration date which is the greater of (i) the same expiration date of the Option the exercise of which gave rise to such Reload
Option or (ii) one year from the date of grant of the Reload Option; and (c) shall have an exercise price which is equal to one
hundred percent (100%) of the Fair Market Value of the Stock subject to the Reload Option on the date of exercise of the original
Option. Notwithstanding the foregoing, a Reload Option which is an Incentive Option and which is granted to a 10% Stockholder,
shall have an exercise price which is equal to one hundred ten percent (110%) of the Fair Market Value of the Stock subject to
the Reload Option on the date of exercise of the original Option and shall have a term which is no longer than five (5) years.


 


Any such Reload Option
may be an Incentive Option or a Nonqualified Option, as the Board of Directors or Committee may designate at the time of the grant
of the original Option; provided, however, that the designation of any Reload Option as an Incentive Option shall be subject to
the provisions of the Code. There shall be no Reload Options on a Reload Option. Any such Reload Option shall be subject to the
availability of sufficient shares under Section 4.2 herein and shall be subject to such other terms and conditions as the Board
of Directors or Committee may determine which are not inconsistent with the express provisions of the Plan regarding the terms
of Options.


 


5.16 No Rights
as Stockholder. No Eligible Person shall have any rights as a stockholder with respect to Stock covered by his Option until
the date a stock certificate is issued for the Stock.


 


5.17Options
Subject to Code Section 409A. Notwithstanding anything to the contrary herein, Options granted under this Article V that
are intended to provide for the deferral of compensation and to be subject to the requirements of Code Section 409A shall contain
such terms and conditions (including, by example and not by way of limitation, fixed exercise dates) as may be necessary or desirable
for the Option to comply with the requirements of Code Section 409A.


 






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ARTICLE VI - AWARDS


 


6.1 Restricted
Stock Awards. The Committee may issue shares of Stock to an Eligible Person subject to the terms of a Restricted Stock
Agreement. The Restricted Stock may be issued for no payment by the Eligible Person or for a payment below the Fair Market Value
on the date of grant. Restricted Stock shall be subject to restrictions as to sale, transfer, alienation, pledge or other encumbrance
and generally will be subject to vesting over a period of time specified in the Restricted Stock Agreement. The Committee shall
determine the period of vesting, the number of shares, the price, if any, of Stock included in a Restricted Stock Award, and the
other terms and provisions which are included in a Restricted Stock Agreement.


 


6.2 Restrictions.
Restricted Stock shall be subject to the terms and conditions as determined by the Committee, including without limitation, any
or all of the following:


 


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


 


(b) a requirement
that the holder of shares of Restricted Stock forfeit, or in the case of shares sold to an Eligible Person, resell back to the
Company at his cost, all or a part of such shares in the event of termination of the Eligible Person’s employment during
any period in which the shares remain subject to restrictions;


 


(c) a prohibition
against employment of the holder of Restricted Stock by any competitor of the Company or its Affiliates, or against such holder’s
dissemination of any secret or confidential information belonging to the Company or an Affiliate;


 


(d) unless stated
otherwise in the Restricted Stock Agreement, (i) if restrictions remain at the time of severance of employment with the Company
and all Affiliates, other than for reason of disability or death, the Restricted Stock shall be forfeited; and (ii) if severance
of employment is by reason of disability or death, the restrictions on the shares shall lapse and the Eligible Person or his heirs
or estate shall be 100% vested in the shares subject to the Restricted Stock Agreement.


 


6.3 Stock Certificate.
Shares of Restricted Stock shall be registered in the name of the Eligible Person receiving the Restricted Stock Award and deposited,
together with a stock power endorsed in blank, with the Company. Each such certificate shall bear a legend in substantially the
following form:


 


“The transferability of this
certificate and the shares of Stock represented by it is restricted by and subject to the terms and conditions (including conditions
of forfeiture) contained in the ERF Wireless, Inc. 2013-A Stock Option Plan, and an agreement entered into between the registered
owner and the Company. A copy of the Plan and agreement is on file in the office of the Secretary of the Company.”


 






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6.4 Rights as Stockholder.
Subject to the terms and conditions of the Plan, each Eligible Person receiving a certificate for Restricted Stock shall have all
the rights of a stockholder with respect to the shares of Stock included in the Restricted Stock Award during any period in which
such shares are subject to forfeiture and restrictions on transfer, including without limitation, the right to vote such shares.
Dividends paid with respect to shares of Restricted Stock in cash or property other than Stock in the Company or rights to acquire
stock in the Company shall be paid to the Eligible Person currently. Dividends paid in Stock in the Company or rights to acquire
Stock in the Company shall be added to and become a part of the Restricted Stock.


 


6.5 Lapse of Restrictions.
At the end of the time period during which any shares of Restricted Stock are subject to forfeiture and restrictions on sale, transfer,
alienation, pledge, or other encumbrance, such shares shall vest and will be delivered in a certificate, free of all restrictions,
to the Eligible Person or to the Eligible Person’s legal representative, beneficiary or heir; provided the certificate shall
bear such legend, if any, as the Committee determines is reasonably required by applicable law. By accepting a Stock Award and
executing a Restricted Stock Agreement, the Eligible Person agrees to remit when due any federal and state income and employment
taxes required to be withheld.


 


6.6Restriction
Period. No Restricted Stock Award may provide for restrictions continuing beyond ten (10) years from the date of grant.


 


6.7Award
of Stock. The Committee may award shares of Stock, without any cash payment for such shares or without any restrictions,
to designated Eligible Persons for services rendered to the Company. The Stock may be subject to purchase at, above or below the
Fair Market Value on the date of grant (or for no amount at all). The designation of a Stock Award shall be made by the Committee
in writing at any time after such Eligible Person has provided value to the Company (or within such period as permitted by IRS
regulations). The Committee reserves the right to make adjustments in the amount of an Award if in its discretion unforeseen events
make such adjustment appropriate.


 


ARTICLE VII - PERFORMANCE STOCK
AWARDS 


 


7.1 Award of Performance
Stock. The Committee may award shares of Stock, without any payment for such shares, to designated Eligible Persons if
specified performance goals established by the Committee are satisfied. The terms and provisions herein relating to these performance-based
awards are intended to satisfy Section 162(m) of the Code and regulations issued thereunder. The designation of an employee eligible
for a specific Performance Stock Award shall be made by the Committee in writing prior to the beginning of the period for which
the performance is measured (or within such period as is permitted by IRS regulations). The Committee shall establish the maximum
number of shares of Stock to be issued to a designated Employee if the performance goal or goals are met; provided, however, that
no individual may receive Performance Stock Awards in any calendar year covering more than 300,000 shares of Stock. The Committee
reserves the right to make downward adjustments in the maximum amount of an Award if in its discretion unforeseen events make such
adjustment appropriate.


 






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7.2 Performance Goals.
Performance goals determined by the Committee shall be established in writing prior to the beginning of the period for which performance
is measured (or within such period as is permitted by IRS regulations) based on one or more of the following criteria: specified
increases in cash flow; net profits; Stock price; Company, segment, or Affiliate sales; market share; earnings per share; return
on assets; and/or return on stockholders’ equity.


 


7.3 Eligibility.
The employees eligible for Performance Stock Awards are the senior officers (i.e., chief executive officer, president, vice presidents,
secretary, treasurer, and similar positions) of the Company and its Affiliates, and such other key Employees of the Company and
its Affiliates as may be designated by the Committee.


 


7.4 Certificate of Performance.
The Committee must certify in writing that a performance goal has been attained prior to issuance of any certificate for a Performance
Stock Award to any Employee. If the Committee certifies the entitlement of an Employee to the Performance Stock Award, the certificate
will be issued to the Employee as soon as administratively practicable, and subject to other applicable provisions of the Plan,
including but not limited to, all legal requirements and tax withholding. However, payment may be made in shares of Stock, in cash,
or partly in cash and partly in shares of Stock, as the Committee shall decide in its sole discretion. If a cash payment is made
in lieu of shares of Stock, the number of shares represented by such payment shall not be available for subsequent issuance under
this Plan.


 


7.5Committee to Comply with
Section 162(m). Notwithstanding anything to the contrary herein, the “Committee,” for purposes of this Article
VII shall consist solely of two or more Outside Directors.


 


ARTICLE VIII - ADMINISTRATION


 


The Committee shall
administer the Plan. All questions of interpretation and application of the Plan and Awards shall be subject to the determination
of the Committee. A majority of the members of the Committee shall constitute a quorum. All determinations of the Committee shall
be made by a majority of its members. Any decision or determination reduced to writing and signed by a majority of the members
shall be as effective as if it had been made by a majority vote at a meeting properly called and held. In carrying out its authority
under this Plan, the Committee shall have full and final authority and discretion, including but not limited to the following rights,
powers and authorities, to:


 


(a) determine the Eligible Persons
to whom and the time or times at which Options or Awards will be made;


 


(b) determine the number of shares
and the purchase price of Stock covered in each Option or Award, subject to the terms of the Plan;


 


(c) determine the terms, provisions,
and conditions of each Option and Award, which need not be identical;


 






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(d) accelerate the time at which
any outstanding Option or SAR may be exercised, or Restricted Stock Award will vest;


 


(e) define the effect, if any,
on an Option or Award of the death, disability, retirement, or termination of employment of the Employee;


 


(f) prescribe, amend and rescind
rules and regulations relating to administration of the Plan; and


 


(g) make all other determinations
and take all other actions deemed necessary, appropriate, or advisable for the proper administration of this Plan.


 


The actions of the
Committee in exercising all of the rights, powers, and authorities set out in this Article and all other Articles of this Plan,
when performed in good faith and in its sole judgment, shall be final, conclusive and binding on all parties.


 


The Committee may,
from time to time, delegate to specified officers of the Company or other committees of the Board of Directors (including Board
committees of one) the power and authority to grant or document Awards under the Plan to specified groups of Eligible Persons,
subject to such restrictions and conditions as the Committee, in its sole discretion, may impose. The delegation shall be as broad
or as narrow as the Committee shall determine; provided, however, that no such delegation shall result in the loss of an exemption
under Rule 16b-3 of the Exchange Act not cause any award to fail to be “performance-based” compensation for purposes
of Code Section 162(m). To the extent that the Committee has delegated the authority to determine certain terms and conditions
of an Award, all references in the Plan to the Committee’s exercise of authority in determining such terms and conditions
shall be construed to include the person to whom the Committee has delegated the power and authority to make such determination.


 


ARTICLE IX - AMENDMENT OR TERMINATION
OF PLAN


 


Except as specifically
provided otherwise, the Board of Directors may at any time terminate, and from time to time may amend or modify this Plan provided,
however, that no amendment or modification may become effective without approval of the stockholders of the Company if stockholder
approval is required to enable the Plan to satisfy any applicable statutory or regulatory requirements, of if the Company, on the
advice of counsel, determines that stockholder approval is otherwise necessary or desirable.


 


Except as specifically
provided otherwise, no such amendment, modification, or termination of the Plan shall affect adversely in any material way any
Award previously granted without the written consent of the Eligible Person holding such Award.


 






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ARTICLE X - MISCELLANEOUS


 


10.1 No Establishment of
a Trust Fund. No property shall be set aside nor shall a trust fund of any kind be established to secure the rights of
any Eligible Person under this Plan. All Eligible Persons shall at all times rely solely upon the general credit of the Company
for the payment of any benefit which becomes payable under this Plan.


 


10.2 No Employment Obligation.
The granting of any Option or Award shall not constitute an employment contract, express or implied, nor impose upon the Company
or any Affiliate any obligation to employ or continue to employ any Eligible Person. The right of the Company or any Affiliate
to terminate the employment of any person shall not be diminished or affected by reason of the fact that an Option or Award has
been granted to him.


 


10.3 Forfeiture.
Notwithstanding any other provisions of this Plan, if the Committee finds by a majority vote after full consideration of the facts
that an Eligible Person, before or after termination of his employment with the Company or an Affiliate for any reason (a) committed
or engaged in fraud, embezzlement, theft, commission of a felony, or proven dishonesty in the course of his employment by the Company
or an Affiliate, which conduct damaged the Company or Affiliate, or disclosed trade secrets of the Company or an Affiliate, or
(b) participated, engaged in or had a material, financial, or other interest, whether as an employee, officer, director, consultant,
contractor, stockholder, owner, or otherwise, in any commercial endeavor in the United States which is competitive with the business
of the Company or an Affiliate without the written consent of the Company or Affiliate, the Eligible Person shall forfeit all outstanding
Options and all outstanding Awards, and including all exercised Options and other situations pursuant to which the Company has
not yet delivered a stock certificate. Clause (b) shall not be deemed to have been violated solely by reason of the Eligible Person’s
ownership of stock or securities of any publicly owned corporation, if that ownership does not result in effective control of the
corporation.


 


The decision of the
Committee as to the cause of an Employee’s discharge, the damage done to the Company or an Affiliate, and the extent of an
Eligible Person’s competitive activity shall be final. No decision of the Committee, however, shall affect the finality of
the discharge of the Employee by the Company or an Affiliate in any manner.


 


10.4 Tax Withholding.
The Company or any Affiliate shall be entitled to deduct from other compensation payable to each Eligible Person any sums required
by federal, state, or local tax law to be withheld with respect to the grant or exercise of an Option or SAR, lapse of restrictions
on Restricted Stock, or award of Performance Stock or other Award. In the alternative, the Company may require the Eligible Person
(or other person exercising the Option, SAR or receiving the Stock) to pay the sum directly to the employer corporation. If the
Eligible Person (or other person exercising the Option or SAR or receiving the Stock) is required to pay the sum directly, payment
in cash or by check of such sums for taxes shall be delivered on the date on which the withholding is due. Alternatively, and subject
to the prior approval of the Committee, which may be withheld by the Committee in its sole discretion, the Eligible Person may
elect to have share of Stock withheld or to deliver shares of Stock previously held by the Eligible Person (for six months or such
minimum amount of time as may be required by the Committee to avoid adverse accounting consequences), to satisfy the minimum statutory
withholding taxes due. The shares of Stock delivered or withheld (i) shall not be subject to any repurchase, forfeiture, vesting
or similar requirements, and (ii) shall have an aggregate Fair Market Value not in excess of such minimum withholding obligations,
with Fair Market Value determined as of the date on which such withholding is required to be performed. The Company’s obligation
to deliver shares upon exercise of any Option or lapse of restrictions on Stock or pursuant to any other Award shall be subject
in its entirety to the Eligible Person making arrangements acceptable to the Company to cover all applicable tax withholding. The
Company and its Affiliates shall not be obligated to advise an Eligible Person of the existence of the tax or the amount which
the employer corporation will be required to withhold.


 






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10.5 Written Agreement or
Course of Conduct. Each Option and Award shall be embodied in a written agreement which shall be subject to the terms and
conditions of this Plan and shall be signed by the Eligible Person and by a member of the Committee on behalf of the Committee
and the Company or an executive officer of the Company, other than the Eligible Person, on behalf of the Company. The agreement
may contain any other provisions that the Committee in its discretion shall deem advisable which are not inconsistent with the
terms of this Plan. Notwithstanding the foregoing, a written agreement is not required if the Option or Award is granted in the
ordinary course of conduct of the business and the Company has sufficient accounting records reflecting the services rendered in
connection with the grant.


 


10.6 Indemnification of the
Committee and the Board of Directors. With respect to administration of this Plan, the Company shall indemnify each present
and future member of the Committee and the Board of Directors against, and each member of the Committee and the Board of Directors
shall be entitled without further act on his part to indemnity from the Company for, all expenses (including attorney’s fees,
the amount of judgments, and the amount of approved settlements made with a view to the curtailment of costs of litigation, other
than amounts paid to the Company itself) reasonably incurred by him in connection with or arising out of any action, suit, or proceeding
in which he may be involved by reason of his being or having been a member of the Committee and/or the Board of Directors, whether
or not he continues to be a member of the Committee and/or the Board of Directors at the time of incurring the expenses, including,
without limitation, matters as to which he shall be finally adjudged in any action, suit or proceeding to have been found to have
been negligent in the performance of his duty as a member of the Committee or the Board of Directors. However, this indemnity shall
not include any expenses incurred by any member of the Committee and/or the Board of Directors in respect of matters as to which
he shall be finally adjudged in any action, suit or proceeding to have been guilty of gross negligence or willful misconduct in
the performance of his duty as a member of the Committee and the Board of Directors. In addition, no right of indemnification under
this Plan shall be available to or enforceable by any member of the Committee and the Board of Directors unless, within 60 days
after institution of any action, suit or proceeding, he shall have offered the Company, in writing, the opportunity to handle and
defend same at its own expense. This right of indemnification shall inure to the benefit of the heirs, executors or administrators
of each member of the Committee and the Board of Directors and shall be in addition to all other rights to which a member of the
Committee and the Board of Directors may be entitled as a matter of law, contract, or otherwise.


 






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10.7 Gender.
If the context requires, words of one gender when used in this Plan shall include the others and words used in the singular or
plural shall include the other.


 


10.8 Headings.
Headings of Articles and Sections are included for convenience of reference only and do not constitute part of the Plan and shall
not be used in construing the terms of the Plan.


 


10.9 Other
Compensation Plans. The adoption of this Plan shall not affect any other stock option, incentive or other compensation
or benefit plans in effect for the Company or any Affiliate, nor shall the Plan preclude the Company from establishing any other
forms of incentive or other compensation for employees of the Company or any Affiliate.


 


10.10 Other Options or Awards.
The grant of an Option or Award shall not confer upon the Eligible Person the right to receive any future or other Options or Awards
under this Plan, whether or not Options or Awards may be granted to similarly situated Eligible Persons, or the right to receive
future Options or Awards upon the same terms or conditions as previously granted.


 


10.11 Governing Law.
The provisions of this Plan shall be construed, administered, and governed under the laws of the State of Texas.


 


10.12Section 409A.
Notwithstanding anything in this Plan to the contrary, the Plan and Awards made under the Plan are intended to comply with the
requirements imposed by Section 409A of the Code, and both the Plan and all Awards issued hereunder shall be interpreted accordingly.
The Committee shall have full power and authority, without the consent of any Eligible Person, to modify in its sole and absolute
discretion any outstanding Award or delay the payment of any amounts payable pursuant to an outstanding Award to the minimum extent
necessary to meet the requirements of Code Section 409A. Notwithstanding the foregoing, in no event shall the Company have any
liability for failure of any Award to satisfy the requirements of Code Section 409A.


 


10.13Changes in Accounting
or Tax Rules. Except a provided otherwise at the time an Award is granted, notwithstanding any other provision of the Plan
to the contrary, if, during the term of the Plan, any changes in the financial or tax accounting rules applicable to any Award
shall occur which, in the sole judgment of the Committee, nay have a material adverse effect on the reported earnings, assets or
liabilities of the Company, the Committee shall have the right and power to modify as necessary and then outstanding Award as to
which the applicable services or other restrictions have not been satisfied.


 




 






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