Exhibit 4.1


 


Confederate
Motors, Inc. 


2014
STOCK INCENTIVE PLAN


  


THE
2014 STOCK INCENTIVE PLAN (the “Plan”) of Confederate Motors, Inc., a Delaware corporation, is hereby adopted
by its Board of Directors as of October 16, 2014 (the “Effective Date”).


 


Article
1. 


PURPOSES
OF THE PLAN


 


Section
1.01Purposes. The purposes of the Plan are (a) to enhance the Company’s ability to attract and retain the services
of qualified employees, officers, directors, consultants and other service providers upon whose judgment, initiative and efforts
the successful conduct and development of the Company’s business largely depends, and (b) to provide additional incentives
to such persons or entities to devote their utmost effort and skill to the advancement and betterment of the Company, by providing
them an opportunity to participate in the ownership of the Company and thereby have an interest in the success and increased value
of the Company.


 


Article
2.


DEFINITIONS


 


For
purposes of this Plan, terms not otherwise defined herein shall have the meanings indicated below:


 


Section
2.01Administrator. “Administrator” means the Board or, if the Board delegates responsibility for any matter
to the Committee, the term Administrator shall mean the Committee.


 


Section
2.02Affiliated Company. “Affiliated Company” means:


 


a)with
respect to Incentive Options, any “parent corporation” or “subsidiary corporation” of the Company, whether
now existing or hereafter created or acquired, as those terms are defined in Sections 424(e) and 424(f) of the Code, respectively;
and


 


b)with
respect to Nonqualified Options, Restricted Stock Units, Stock Appreciation Rights, and Restricted Stock Grants any entity described
in paragraph (a) of this Section 2.02 above, plus any other corporation, limited liability company (“LLC”),
partnership or joint venture, whether now existing or hereafter created or acquired, with respect to which the Company beneficially
owns more than fifty percent (50%) of: (1) the total combined voting power of all outstanding voting securities or (2) the capital
or profits interests of an LLC, partnership or joint venture.


 


Section
2.03Base Price. “Base Price” means the price per share of Common Stock for purposes of computing the amount
payable to a Participant who holds a Stock Appreciation Right upon exercise thereof.


 


Section
2.04Board. “Board” means the Board of Directors of the Company.


 


Section
2.05Change in Control. “Change in Control” means:


 


a)The
acquisition, directly or indirectly, in one transaction or a series of related transactions, by any person or group (within the
meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended) of the beneficial ownership of securities of the
Company possessing more than fifty percent (50%) of the total combined voting power of all outstanding securities of the Company;


 






    	 



     

    

 


b)A
merger or consolidation in which the Company is not the surviving entity, except for a transaction in which the holders of the
outstanding voting securities of the Company immediately prior to such merger or consolidation hold as a result of holding Company
securities prior to such transaction, in the aggregate, securities possessing more than fifty percent (50%) of the total combined
voting power of all outstanding voting securities of the surviving entity (or the parent of the surviving entity) immediately
after such merger or consolidation;


 


c)A
reverse merger in which the Company is the surviving entity but in which the holders of the outstanding voting securities of the
Company immediately prior to such merger hold, in the aggregate, securities possessing less than fifty percent (50%) of the total
combined voting power of all outstanding voting securities of the Company or of the acquiring entity immediately after such merger;
or


 


d) The sale, transfer or other disposition (in one transaction or a series of related transactions) of all or substantially
all of the assets of the Company, except for a transaction in which the holders of the outstanding voting securities of the Company
immediately prior to such transaction(s) receive as a distribution with respect to securities of the Company, in the aggregate,
securities possessing more than fifty percent (50%) of the total combined voting power of all outstanding voting securities of
the acquiring entity immediately after such transaction(s).




 


e)In
addition, a Change in Control will be deemed to have occurred if, at any time during any period of twelve (12) consecutive months
during the term of any Option Agreement, Restricted Stock Unit Agreement or Stock Appreciation Right Agreement under this Plan,
individuals who at the beginning of such period constituted the entire Board do not for any reason constitute a majority of the
Board, unless the election, or the nomination for election by the Company’s stockholders, of each new director was approved
by a vote of at least a majority of the directors then still in office who were directors at the beginning of the period (but
not including any new director whose election or nomination is in connection with an actual or threatened proxy contest relating
to the election of directors of the Company).


 


Notwithstanding
the foregoing, a transaction will not be deemed a Change in Control unless the transaction qualifies as a change in control event
within the meaning of Section 409A of the Code.


 


Section
2.06Code. “Code” means the Internal Revenue Code of 1986, as amended from time to time.


 


Section
2.07Committee. “Committee” means a committee of two or more members of the Board appointed to administer the
Plan, as set forth in Section 9.01.


 


Section
2.08Common Stock. “Common Stock” means the Common Stock of the Company, subject to adjustment pursuant to
Section 4.02.


 


Section
2.09Company. “Company” means Confederate Motors, Inc., a Delaware corporation, or any entity that is a successor
to the Company. Except where the context otherwise requires, the term “Company” shall include any of
the Company’s present or future parent or subsidiary corporations


 


Section
2.10Disability. “Disability” means permanent and total disability as defined in Section 22(e)(3) of the Code.
The Administrator’s determination of a Disability or the absence thereof shall be conclusive and binding on all interested
parties.


 


Section
2.11Effective Date. “Effective Date” means the date on which the Plan was originally adopted by the Board,
as set forth on the first page hereof.


 






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Section
2.12Exchange Act. “Exchange Act” means the Securities and Exchange Act of 1934, as amended.


 


Section
2.13Exercise Price. “Exercise Price” means the purchase price per share of Common Stock payable by the Optionee
to the Company upon exercise of an Option.


 


Section
2.14Fair Market Value. “Fair Market Value” on any given date means the value of one share of Common Stock,
determined as follows:


 


a)If
the Common Stock is then listed or admitted to trading on The NASDAQ Stock Market or another stock exchange which reports closing
sale prices, the Fair Market Value shall be the closing sale price on the date of valuation on The NASDAQ Stock Market or principal
stock exchange on which the Common Stock is then listed or admitted to trading, or, if no closing sale price is quoted on such
day, then the Fair Market Value shall be the closing sale price of the Common Stock on The NASDAQ Stock Market or such exchange
on the next preceding day on which a closing sale price is reported.


 


b)If
the Common Stock is not then listed or admitted to trading on The NASDAQ Stock Market or a stock exchange which reports closing
sale prices, the Fair Market Value shall be the average of the closing bid and asked prices of the Common Stock in the over-the-counter
market on the date of valuation.


 


c)If
neither (a) nor (b) is applicable as of the date of valuation, then the Fair Market Value shall be determined by the Administrator
in good faith using any reasonable method of evaluation in a manner consistent with the valuation principles under Section 409A
of the Code, which determination shall be conclusive and binding on all interested parties.


 


Section
2.15FINRA Dealer. “FINRA Dealer” means a broker-dealer that is a member of the Financial Industry Regulatory
Authority.


 


Section
2.16Incentive Option. “Incentive Option” means any Option designated and qualified as an “incentive
stock option” as defined in Section 422 of the Code.


 


Section
2.17Incentive Option Agreement. “Incentive Option Agreement” means an Option Agreement with respect to an
Incentive Option.


 


Section
2.18Nonqualified Option. “Nonqualified Option” means any Option that is not an Incentive Option.  To
the extent that any Option designated as an Incentive Option fails in whole or in part to qualify as an Incentive Option, including,
without limitation, for failure to meet the limitations applicable to a 10% Stockholder or because it exceeds the annual limit
provided for in Section 5.07 below, it shall to that extent constitute a Nonqualified Option.


 


Section
2.19Nonqualified Option Agreement. “Nonqualified Option Agreement” means an Option Agreement with respect
to a Nonqualified Option.


 


Section
2.20Option. “Option” means any option to purchase Common Stock granted pursuant to this Plan.


 


Section
2.21Option Agreement. “Option Agreement” means the written agreement entered into between the Company and
the Optionee with respect to an Option granted under this Plan.


 






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Section
2.22Optionee. “Optionee” means any Participant who holds an Option.


 


Section
2.23Participant. “Participant” means an individual or entity that holds Options, Restricted Stock Units, Stock
Appreciation Rights, or Restricted Shares under this Plan.


 


Section
2.24Performance Criteria. “Performance Criteria” means one or more of the following as established by the
Administrator, which may be stated as a target percentage or dollar amount, a percentage increase over a base period percentage
or dollar amount or the occurrence of a specific event or events:


 


a)Revenue; 


b)Gross
profit; 


c)Operating
income; 


d)Pre-tax
income;   


e)Earnings
before interest, taxes, depreciation and amortization (“EBITDA”); 


f)Earnings
per common share on a fully diluted basis (“EPS”); 


g)Consolidated
net income of the Company divided by the average consolidated common stockholders’ equity (“ROE”); 


h)Cash
and cash equivalents derived from either (i) net cash flow from operations, or (ii) net cash flow from operations, financings
and investing activities (“Cash Flow”); 


i)Adjusted
operating cash flow return on income; 


j)Cost
containment or reduction; 


k)The
percentage increase in the market price of the Company’s common stock over a stated period; and 


l)Individual
business objectives.


 


Section
2.25Restricted Shares. “Restricted Shares” means shares issued pursuant to the Stock Issuance Program in Article
8.


 


Section
2.26Restricted Stock Unit. “Restricted Stock Unit” means a right to receive an amount equal to the Fair Market
Value of one share of Common Stock, issued pursuant to Article 6, subject to any restrictions and conditions as are established
pursuant to Article 6.


 


Section
2.27Restricted Stock Unit Agreement. “Restricted Stock Unit Agreement” means the written agreement entered
into between the Company and a Participant evidencing the grant of Restricted Stock Units under the Plan.


 


Section
2.28Service. “Service” shall mean the provision of services to the Company (or any Parent or Subsidiary) by
a person in the capacity of an employee, a non-employee member of the board of directors or a consultant or independent advisor,
except to the extent otherwise specifically provided in the documents evidencing the option grant.


 


Section
2.29Service Provider. “Service Provider” means a consultant or other person or entity the Administrator authorizes
to become a  Participant in the Plan and who provides services to (i) the Company, (ii) an Affiliated Company, or (iii) any
other business venture designated by the Administrator in which the Company or an Affiliated Company has a significant ownership
interest.


 


Section
2.30Stock Appreciation Right. “Stock Appreciation Right” means a right issued pursuant to Article 7, subject
to any restrictions and conditions as are established pursuant to Article 7 that is designated as a Stock Appreciation Right.


 






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Section
2.31Stock Appreciation Right Agreement. “Stock Appreciation Right Agreement” means the written agreement entered
into between the Company and a Participant evidencing the grant of Stock Appreciation Rights under the Plan.


 


Section
2.32Stock Issuance Program. “Stock Issuance Program” means the program to issue restricted shares pursuant
to Article 8.


 


Section
2.3310% Stockholder. “10% Stockholder” means a person who, as of a relevant date, owns or is deemed to own
(by reason of the attribution rules applicable under Section 424(d) of the Code) stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company or of an Affiliated Company.


 


Article
3.


ELIGIBILITY


 


Section
3.01Incentive Options. Only employees of the Company or of an Affiliated Company (including members of the Board if they
are employees of the Company or of an Affiliated Company) are eligible to receive Incentive Options under the Plan.


 


Section
3.02Nonqualified Options; Restricted Stock Units and Stock Appreciation Rights. Employees of the Company or of an Affiliated
Company, members of the Board (whether or not employed by the Company or an Affiliated Company), and Service Providers are eligible
to receive Nonqualified Options, Restricted Stock Units and Stock Appreciation Rights under the Plan.


 


Section
3.03Section 162(m) Limitation. Subject to adjustment as to the number and kind of shares pursuant to Section 4.2, in no
event shall any Participant be granted in any one calendar year (a) Options or Stock Appreciation Rights pursuant to which, with
respect to Options, the aggregate number of shares of Common Stock that may be acquired thereunder or, with respect to Stock Appreciation
Rights, the aggregate number of shares of Common Stock covered thereby, exceeds four hundred thousand (400,000) shares or (b)
Restricted Stock Units pursuant to which the aggregate number of shares of Common Stock covered thereby exceeds one hundred thousand
(100,000) shares.


 


Article
4.


PLAN
SHARES


 


Section
4.01Shares Subject to the Plan.


 


a)The
number of shares of Common Stock that may be issued under this Plan shall be four million (4,000,000) shares, subject
to adjustment as to the number and kind of shares pursuant to Section 4.02. For purposes of this limitation, in the event
that (a) all or any portion of any Options or Stock Appreciation Rights granted under the Plan can no longer under any
circumstances be exercised, (b) any shares of Common Stock are reacquired by the Company pursuant to an Option Agreement, or
(c) all or any portion of any Restricted Stock Units granted under the Plan are forfeited or can no longer under any
circumstances vest, the shares of Common Stock allocable to or covered by the unexercised or unvested portion of such
Options, Stock Appreciation Rights or Restricted Stock Units or the shares of Common Stock so reacquired shall again be
available for grant or issuance under the Plan. The following shares of Common Stock may not again be made available for
issuance as awards under the Plan: (i) shares of Common Stock not issued or delivered as a result of the net settlement of
outstanding Stock Appreciation Rights or Options, (ii) shares of Common Stock used to pay the Exercise Price related to
outstanding Options, (iii) shares of Common Stock used to pay withholding taxes related to outstanding Options, Stock
Appreciation Rights or Restricted Stock Units, or (iv) shares of Common Stock repurchased on the open market with the
proceeds of the Option Exercise Price.


 






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b)At
no time shall the total number of shares of Common Stock issuable upon exercise of all outstanding Options and the total number
of shares issuable for Restricted Stock Units, Stock Appreciation Rights, or Restricted Shares exceed 30% of the then outstanding
securities of the Company (with convertible preferred or convertible senior common shares of stock counted on an as if converted
basis), unless a percentage higher than 30% is approved by at least two-thirds of the outstanding securities entitled to vote.
The applicable percentage shall be calculated based on the securities of the Company which are outstanding at the time the calculation
is made.


 


c)The
maximum number of shares of Common Stock that may be issued under the Plan as Incentive Options shall be four million
(4,000,000) shares, subject to adjustment as to the number and kind of shares pursuant to Section 4.02.


 


Section
4.02Changes in Capital Structure. In the event that the outstanding shares of Common Stock 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, reverse stock split, reclassification, stock dividend, or other change in the capital structure
of the Company, then appropriate adjustments shall be made by the Administrator to the aggregate number and kind of shares subject
to this Plan, the number and kind of shares and the price per share subject to or covered by outstanding Option Agreements, Restricted
Stock Unit Agreements or Stock Appreciation Right Agreements and the limit on the number of shares under Section 3.03, all in
order to preserve, as nearly as practical, but not to increase, the benefits to Participants.


 


Article
5.


OPTIONS


 


Section
5.01Grant of Stock Options.  The Administrator shall have the right to grant pursuant to this Plan, Options subject
to such terms, restrictions and conditions as the Administrator may determine at the time of grant.  Such conditions may
include, but are not limited to, continued employment or the achievement of specified performance goals or objectives established
by the Administrator with respect to one or more Performance Criteria, which require the Administrator to certify in writing whether
and the extent to which such Performance Criteria were achieved.


 


Section
5.02Option Agreements. Each Option granted pursuant to this Plan shall be evidenced by an Option Agreement which shall
specify the number of shares subject thereto, vesting provisions relating to such Option, the Exercise Price per share, and whether
the Option is an Incentive Option or Nonqualified Option. As soon as is practical following the grant of an Option, an Option
Agreement shall be duly executed and delivered by or on behalf of the Company to the Optionee to whom such Option was granted.
 Each Option Agreement shall be in such form and contain such additional terms and conditions, not inconsistent with the
provisions of this Plan, as the Administrator shall, from time to time, deem desirable.


 


Section
5.03Exercise Price. The Exercise Price per share of Common Stock covered by each Option shall be determined by the Administrator,
subject to the following:  (a) the Exercise Price of an Incentive Option shall not be less than 100% of Fair Market Value
on the date the Incentive Option is granted, (b) the Exercise Price of a Nonqualified Option shall not be less than 100% of Fair
Market Value on the date the Nonqualified Option is granted, and (c) if the person to whom an Incentive Option is granted is a
10% Stockholder on the date of grant, the Exercise Price shall not be less than 110% of Fair Market Value on the date the Incentive
Option is granted. However, an Option may be granted with an Exercise Price lower than that set forth in the preceding sentence
if such Option is granted pursuant to an assumption or substitution for another option in a manner satisfying the provisions of
Sections 409A and 424 of the Code.


 






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Section
5.04Payment of Exercise Price. Payment of the Exercise Price shall be made upon exercise of an Option and may be made,
in the discretion of the Administrator, subject to any legal restrictions, by: (a) cash; (b) check; (c) the surrender of shares
of Common Stock owned by the Optionee (provided that shares acquired pursuant to the exercise of options granted by the Company
must have been held by the Optionee for the requisite period necessary to avoid a charge to the Company’s earnings for financial
reporting purposes), which surrendered shares shall be valued at Fair Market Value as of the date of such exercise; (d) the cancellation
of indebtedness of the Company to the Optionee; (e) the waiver of compensation due or accrued to the Optionee for services
rendered; (f) provided that a public market for the Common Stock exists, a “same day sale” commitment from the Optionee
and a FINRA Dealer whereby the Optionee irrevocably elects to exercise the Option and to sell a portion of the shares so purchased
to pay for the Exercise Price and whereby the FINRA Dealer irrevocably commits upon receipt of such shares to forward the Exercise
Price directly to the Company; (g) provided that a public market for the Common Stock exists, a “margin” commitment
from the Optionee and a FINRA Dealer whereby the Optionee irrevocably elects to exercise the Option and to pledge the shares so
purchased to the FINRA Dealer in a margin account as security for a loan from the FINRA Dealer in the amount of the Exercise Price,
and whereby the FINRA Dealer irrevocably commits upon receipt of such shares to forward the Exercise Price directly to the Company;
or (h) any combination of the foregoing methods of payment or any other consideration or method of payment as shall be permitted
by applicable law.


 


Section
5.05Term and Termination of Options. The term and provisions for termination of each Option shall be as fixed by the Administrator,
but no Option may be exercisable more than ten (10) years after the date it is granted.  An Incentive Option granted to a
person who is a 10% Stockholder on the date of grant shall not be exercisable more than five (5) years after the date it is granted.


 


Section
5.06Vesting and Exercise of Options. Each Option shall vest and become exercisable in one or more installments at such
time or times and subject to such conditions, including without limitation the achievement of specified performance goals or objectives
established with respect to one or more Performance Criteria, as shall be determined by the Administrator.


 


Section
5.07Annual Limit on Incentive Options. To the extent required for “incentive stock option” treatment under
Section 422 of the Code, the aggregate Fair Market Value (determined as of the time of grant) of the Common Stock with respect
to which Incentive Options granted under this Plan and any other plan of the Company or any Affiliated Company become exercisable
for the first time by an Optionee during any calendar year shall not exceed $100,000.


 


Section
5.08Nontransferability of Options. Except as otherwise provided in this Section 5.08, Options shall not be assignable
or transferable except by will, the laws of descent and distribution or to a revocable trust, and during the life of the Optionee,
Options shall be exercisable only by the Optionee. At the discretion of the Administrator and in accordance with rules it establishes
from time to time, Optionees may be permitted to transfer some or all of their Nonqualified Options to one or more “family
members,” which is not a “prohibited transfer for value,” provided that (i) the Optionee (or such Optionee’s
estate or representative) shall remain obligated to satisfy all income or other tax withholding obligations associated with the
exercise of such Nonqualified Option; (ii) the Optionee shall notify the Company in writing that such transfer has occurred and
disclose to the Company the name and address of the “family member” or “family members” and their relationship
to the Optionee, and (iii) such transfer shall be effected pursuant to transfer documents in a form approved by the Administrator.
For purposes of the foregoing, the terms “family members” and “prohibited transfer for value” have the
meaning ascribed to them in the General Instructions to Form S-8 (or any successor form) promulgated under the Securities Act
of 1933, as amended.


 






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Section
5.09Effect of Termination of Employment.


 


a)The
following provisions shall govern the exercise of any Options held by the Optionee at the time of termination of employment, disability,
or death: 


 


(1)Should
the Optionee’s employment be terminated for cause, then the Options shall terminate on the date of employment is terminated.


  


(2)Should
the Optionee’s employment be terminated for disability, then the Optionee shall have a period of six (6) months following
the date of such termination during which to exercise each outstanding Option held by such Optionee at the time of disability.


  


(3)If
the Optionee dies while holding an outstanding Option, then the personal representative of his or her estate or the person or
persons to whom the Option is transferred pursuant to the Optionee’s will or the laws of inheritance shall have six (6)
months following the date of the Optionee’s death to exercise such Option.


  


(4)Should
Optionee’s employment be terminated by reason other than for cause, disability, or death, then the Optionee shall have a
period of thirty (30) days following the date of such termination during which to exercise each outstanding option held by such
Optionee.


  


(5)Under
no circumstances, however, shall any such Option be exercisable after the specified expiration of the option term.


  


(6)During
the applicable post-Service exercise period, the Option may not be exercised in the aggregate for more than the number of vested
shares for which the Option is exercisable on the date of the Optionee’s termination of employment. Upon the expiration
of the applicable exercise period or (if earlier) upon the expiration of the Option term, the Option shall terminate and cease
to be outstanding for any vested shares for which the Option has not been exercised. However, the Option shall, immediately upon
the Optionee’s termination of employment, terminate and cease to be outstanding with respect to any and all Option shares
for which the option is not otherwise at the time exercisable or in which the Optionee is not otherwise at that time vested.


 


b)The
Administrator shall have the discretion, exercisable either at the time an Option is granted or at any time while the Option remains
outstanding, to:


  


(1)extend
the period of time for which the Option is to remain exercisable following Optionee’s termination of employment or death
from the limited period otherwise in effect for that Option to such greater period of time as the Administrator shall deem appropriate,
but in no event beyond the expiration of the Option term; and/or


 


(2)permit
the Option to be exercised, during the applicable post-termination exercise period, not only with respect to the number of vested
shares of Common Stock for which such Option is exercisable at the time of the Optionee’s termination of employment but
also with respect to one or more additional installments in which the Optionee would have vested under the Option had the Optionee
continued employment.


 






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Section
5.10Rights as a Stockholder. An Optionee or permitted transferee of an Option shall have no rights or privileges as a
stockholder with respect to any shares covered by an Option until such Option has been duly exercised and certificates representing
shares purchased upon such exercise have been issued to such person.


 


Article
6.


RESTRICTED
STOCK UNITS


 


Section
6.01Grants of Restricted Stock Units. The Administrator shall have the right to grant pursuant to this Plan Restricted
Stock Units subject to such terms, restrictions and conditions as the Administrator may determine at the time of grant.  Such
conditions may include, but are not limited to, continued employment or the achievement of specified performance goals or objectives
established by the Administrator with respect to one or more Performance Criteria, which require the Administrator to certify
in writing whether and the extent to which such Performance Criteria were achieved.


 


Section
6.02Restricted Stock Unit Agreements. A Participant shall have no rights with respect to the Restricted Stock Units covered
by a Restricted Stock Unit Agreement until the Participant has executed and delivered to the Company the applicable Restricted
Stock Unit Agreement. Each Restricted Stock Unit Agreement shall be in such form, and shall set forth such other terms, conditions
and restrictions of the Restricted Stock Unit Agreement, not inconsistent with the provisions of this Plan, as the Administrator
shall, from time to time, deem desirable. Each such Restricted Stock Unit Agreement may be different from each other Restricted
Stock Unit Agreement.


 


Section
6.03Vesting of Restricted Stock Units. The Restricted Stock Unit Agreement shall specify the date or dates, the performance
goals, if any, established by the Administrator with respect to one or more Performance Criteria that must be achieved, and any
other conditions on which the Restricted Stock Units may vest.


 


Section
6.04Form and Timing of Settlement. Settlement in respect of vested Restricted Stock Units will be automatic upon vesting
thereof.  Payment in respect thereof will be made no later than thirty (30) days thereafter and may, in the discretion of
the Administrator, be in cash, shares of Common Stock of equivalent Fair Market Value as of the date of exercise, or a combination
of both, except as specifically provided in the Restricted Stock Unit Agreement.


 


Section
6.05Rights as a Stockholder. Holders of Restricted Stock Units shall have no rights or privileges as a stockholder with
respect to any shares of Common Stock covered thereby unless and until they become owners of shares of Common Stock following
settlement in respect of such Restricted Stock Units, in whole or in part, in shares of Common Stock pursuant to their respective
Restricted Stock Unit Agreements and the terms and conditions of the Plan.


 


Section
6.06Restrictions. Restricted Stock Units may not be sold, pledged or otherwise encumbered or disposed of and shall not
be assignable or transferable except by will, the laws of descent and distribution or pursuant to a domestic relations order entered
by a court in settlement of marital property rights, except as specifically provided in the Restricted Stock Unit Agreement or
as authorized by the Administrator.


 






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Article
7.


STOCK
APPRECIATION RIGHTS


 


Section
7.01Grants of Stock Appreciation Rights. The Administrator shall have the right to grant pursuant to this Plan, Stock
Appreciation Rights subject to such terms, restrictions and conditions as the Administrator may determine at the time of grant.
Such conditions may include, but are not limited to, continued employment or the achievement of specified performance goals or
objectives established by the Administrator with respect to one or more Performance Criteria, which require the Administrator
to certify in writing whether and the extent to which such Performance Criteria were achieved.


 


Section
7.02Stock Appreciation Right Agreements. A Participant shall have no rights with respect to the Stock Appreciation Rights
covered by a Stock Appreciation Right Agreement until the Participant has executed and delivered to the Company the applicable
Stock Appreciation Right Agreement. Each Stock Appreciation Right Agreement shall be in such form, and shall set forth the Base
Price and such other terms, conditions and restrictions of the Stock Appreciation Right Agreement, not inconsistent with the provisions
of this Plan, as the Administrator shall, from time to time, deem desirable. Each such Stock Appreciation Right Agreement may
be different from each other Stock Appreciation Right Agreement.


 


Section
7.03Base Price. The Base Price per share of Common Stock covered by each Stock Appreciation Right shall be determined
by the Administrator and will be not less than 100% of Fair Market Value on the date the Stock Appreciation Right is granted.
 However, a Stock Appreciation Right may be granted with a Base Price lower than that set forth in the preceding sentence
if such Stock Appreciation Right is granted pursuant to an assumption or substitution for another stock appreciation right in
a manner satisfying the provisions of Section 409A of the Code.


 


Section
7.04Term and Termination of Stock Appreciation Rights. The term and provisions for termination of each Stock Appreciation
Right shall be as fixed by the Administrator, but no Stock Appreciation Right may be exercisable more than ten (10) years after
the date it is granted.


 


Section
7.05Vesting and Exercise of Stock Appreciation Rights. Each Stock Appreciation Right shall vest and become exercisable
in one or more installments at such time or times and subject to such conditions, including without limitation the achievement
of specified performance goals or objectives established with respect to one or more Performance Criteria, as shall be determined
by the Administrator.


 


Section
7.06Amount, Form and Timing of Settlement. Upon exercise of a Stock Appreciation Right, the Participant who holds such
Stock Appreciation Right will be entitled to receive payment from the Company in an amount equal to the product of (a) the difference
between the Fair Market Value of a share of Common Stock on the date of exercise over the Base Price per share of Common Stock
covered by such Stock Appreciation Right and (b) the number of shares of Common Stock with respect to which such Stock Appreciation
Right is being exercised. Payment in respect thereof will be made no later than thirty (30) days after such exercise, provided
that such payment will be made in a manner such that no amount of compensation will be treated as deferred under Treasury Regulation
Section 1.409A-1(b)(5)(i)(D).  Such payment may, in the discretion of the Administrator, be in cash, shares of Common Stock
of equivalent Fair Market Value as of the date of exercise, or a combination of both, except as specifically provided in the Stock
Appreciation Right Agreement.


 


Section
7.07Rights as a Stockholder. Holders of Stock Appreciation Rights shall have no rights or privileges as a stockholder
with respect to any shares of Common Stock covered thereby unless and until they become owners of shares of Common Stock following
settlement in respect of such Stock Appreciation Rights, in whole or in part, in shares of Common Stock pursuant to their respective
Stock Appreciation Right Agreements and the terms and conditions of the Plan.


 






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Section
7.08Restrictions. Stock Appreciation Rights may not be sold, pledged or otherwise encumbered or disposed of and shall
not be assignable or transferable except by will, the laws of descent and distribution or pursuant to a domestic relations order
entered by a court in settlement of marital property rights, except as specifically provided in the Stock Appreciation Right Agreement
or as authorized by the Administrator.


 


Article
8.


STOCK
ISSUANCE PROGRAM


 


Section
8.01Stock Issuance Terms. Shares of Common Stock may be issued under the Stock Issuance Program through direct and immediate
issuances of Restricted Shares without any intervening option grants. Each such stock grant shall be evidenced by a Stock Issuance
Agreement which complies with the terms specified below.


 


Section
8.02Cost of Shares.  Grants of Restricted Shares under the Stock Issuance Program shall be made at such cost as
the Administrator shall determine and may be issued for no monetary consideration, subject to applicable state law.


 


Section
8.03Vesting Provisions.


 


a)Restricted
Shares issued under the Stock Issuance Program may, in the discretion of the Administrator, be fully and immediately vested upon
issuance or may vest in one or more installments over the Participant’s period of Service or upon attainment of specified
performance objectives.


 


b)Any
new, substituted or additional securities or other property (including money paid other than as a regular cash dividend) which
the Participant may have the right to receive with respect to the Participant’s unvested Restricted Shares by reason of
any stock dividend, stock split, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding
Common Stock as a class without the Company’s receipt of consideration shall be issued subject to (i) the same vesting requirements
applicable to the Participant’s unvested Restricted Shares and (ii) such escrow arrangements as the Administrator shall
deem appropriate.


 


c)Unless
specified otherwise in the Stock Issuance Agreement, the Participant shall have full shareholder rights with respect to any Restricted
Shares issued to the Participant under the Stock Issuance Program, whether or not the Participant’s interest in those shares
is vested, and accordingly, the Participant shall have the right to vote such shares and to receive any regular cash dividends
paid on such shares.


 


d)Should
the Participant cease to remain in Service while holding one or more unvested Restricted Shares issued under the Stock Issuance
Program or should the performance objectives not be attained with respect to one or more such unvested Restricted shares, then
those shares shall be immediately surrendered to the Company for cancellation, and the Participant shall have no further shareholder
rights with respect to those shares. To the extent the surrendered shares were previously issued to the Participant for consideration
paid in cash or cash equivalent (including the Participant’s purchase-money indebtedness), the Company shall repay to the
Participant the cash consideration paid for the surrendered shares and shall cancel the unpaid principal balance of any outstanding
purchase-money note of the Participant attributable to such surrendered shares.


 






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e)The
Administrator may in its discretion waive the surrender and cancellation of one or more unvested Restricted Shares (or other assets
attributable thereto) which would otherwise occur upon the non-completion of the vesting schedule applicable to such shares. Such
waiver shall result in the immediate vesting of the Participant’s interest in the Restricted Shares as to which the waiver
applies. Such waiver may be effected at any time, whether before or after the Participant’s cessation of Service or the
attainment or non-attainment of the applicable performance objectives.


 


Section
8.04Non-transferability. Restricted Shares granted under the Stock Issuance Program shall not be transferable
until the shares are vested.


 


Section
8.05Share Escrow/Legends. Unvested Restricted Shares may, in the Administrator’s discretion, be held in escrow by
the Company until the Participant’s interest in such shares vests or may be issued directly to the Participant with restrictive
legends on the certificates evidencing those unvested shares.


 


Article
9.


ADMINISTRATION
OF THE PLAN


 


Section
9.01Administrator. Authority to control and manage the operation and administration of the Plan shall be vested in the
Board, which may delegate such responsibilities in whole or in part to a committee consisting of two (2) or more members of the
Board (the “Committee”), each of whom shall meet the independence requirements under the then applicable rules,
regulations or listing requirements adopted by The NASDAQ Stock Market or the principal exchange on which the Company’s
shares of Common Stock are then listed or admitted to trading.  Members of the Committee may be appointed from time to time
by, and shall serve at the pleasure of, the Board. The Board may limit the composition of the Committee to those persons necessary
to comply with the requirements of Section 162(m) of the Code and Section 16 of the Exchange Act. As used herein, the term “Administrator”
means the Board or, with respect to any matter as to which responsibility has been delegated to the Committee, the term Administrator
shall mean the Committee.


 


Section
9.02Powers of the Administrator. In addition to any other powers or authority conferred upon the Administrator elsewhere
in this Plan or by law, the Administrator shall have full power and authority:  (a) to determine the persons to whom,
and the time or times at which, Incentive Options, Nonqualified Options, Restricted Stock Units, Stock Appreciation Rights, or
Restricted Shares shall be granted, the number of shares to be represented by each Option Agreement or covered by each Restricted
Stock Unit Agreement or Stock Appreciation Right Agreement, and the Exercise Price of such Options and the Base Price of such
Stock Appreciation Rights; (b) to interpret the Plan; (c) to create, amend or rescind rules and regulations relating
to the Plan; (d) to determine the terms, conditions and restrictions contained in, and the form of, Option Agreements, Restricted
Stock Unit Agreements, Stock Appreciation Right Agreements, and Stock Issuance Agreement; (e) to determine the identity or
capacity of any persons who may be entitled to exercise a Participant’s rights under any Option Agreement, Restricted Stock
Unit Agreement, Stock Appreciation Right Agreement, or Stock Issuance Agreement under the Plan; (f) to correct any defect
or supply any omission or reconcile any inconsistency in the Plan or in any Option Agreement, Restricted Stock Unit Agreement,
Stock Appreciation Right Agreement, or Stock Issuance Agreement; (g) to accelerate the vesting of any Option, Restricted
Stock Unit, Stock Appreciation Right, or Restricted Shares; (h) to extend the expiration date of any Option Agreement,
Stock Appreciation Right Agreement, or Stock Issuance Agreement; (i) subject to Section 9.03, to amend outstanding Option
Agreements, Restricted Stock Unit Agreements, Stock Appreciation Right Agreements, or Stock Issuance Agreements to provide for,
among other things, any change or modification which the Administrator could have included in the original agreement or in furtherance
of the powers provided for herein; and (j) to make all other determinations necessary or advisable for the administration
of this Plan, but only to the extent not contrary to the express provisions of this Plan.  Any action, decision, interpretation
or determination made in good faith by the Administrator in the exercise of its authority conferred upon it under this Plan shall
be final and binding on the Company and all Participants.  Notwithstanding any term or provision in this Plan, the Administrator
shall not have the power or authority, by amendment or otherwise to extend the expiration date of an Option or Stock Appreciation
Right beyond the tenth (10th) anniversary of the date such Option or Stock Appreciation Right was granted.


 






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Section
9.03Repricing Prohibited. Subject to Section 4.02, and except in connection with a corporate transaction involving the
Company (including, without limitation, any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization,
merger, consolidation, split-up, spin-off, combination, or exchange of shares), neither the Committee nor the Board shall amend
the terms of outstanding awards to reduce the Exercise Price of outstanding Options or the Base Price of outstanding Stock Appreciation
Rights or cancel outstanding Options, Stock Appreciation Rights, or Restricted Shares in exchange for cash, other awards or Options
with an Exercise Price that is less than the Exercise Price of the original Options or Stock Appreciation Rights with a Base Price
that is less than the Base Price of the original Stock Appreciation Rights, without approval of the Company’s stockholders,
evidenced by a majority of votes cast.


 


Section
9.04Limitation on Liability.  No employee of the Company or member of the Board or Committee shall be subject to
any liability with respect to duties under the Plan unless the person acts fraudulently or in bad faith.  To the extent permitted
by law, the Company shall indemnify each member of the Board or Committee, and any employee of the Company with duties under the
Plan, who was or is a party, or is threatened to be made a party, to any threatened, pending or completed proceeding, whether
civil, criminal, administrative or investigative, by reason of such person’s conduct in the performance of duties under
the Plan.


 


Article
10.


CHANGE
IN CONTROL


 


Section
10.01Options and Stock Appreciation Rights. Vesting of all outstanding Options, Stock or Appreciation Rights shall accelerate
automatically effective as of immediately prior to the consummation of the Change in Control. In connection with such acceleration,
the Administrator in its discretion may provide, in connection with the Change in Control transaction, for the purchase or exchange
of each Option or Stock Appreciation Right for an amount of cash or other property having a value equal to (i) with respect to
each Option, the amount (or “spread”) by which, (x) the value of the cash or other property that the Optionee would
have received pursuant to the Change in Control transaction in exchange for the shares issuable upon exercise of the Option had
the Option been exercised immediately prior to the Change in Control, exceeds (y) the Exercise Price of the Option, and (ii) with
respect to each Stock Appreciation Right, the value of the cash or other property that the Participant would have received had
the Stock Appreciation Right been exercised immediately prior to the Change in Control. The Administrator shall have the discretion
to provide in each Option Agreement and Stock Appreciation Right Agreement other terms and conditions that relate to vesting of
such Option or Stock Appreciation Right in the event of a Change in Control. The aforementioned terms and conditions may vary
in each Option Agreement and Stock Appreciation Right Agreement, and may be different from and have precedence over the provisions
set forth in this Section 10.01.


 


Section
10.02Restricted Stock Units and Restricted Shares. All Restricted Stock Units and unvested Restricted Shares shall vest
in full effective as of immediately prior to the consummation of the Change in Control. In connection with such acceleration,
the Administrator in its discretion may provide, in connection with the Change in Control transaction, for the purchase or exchange
of each Restricted Stock Unit or Restricted Share for an amount of cash or other property having a value equal to the value of
the cash or other property that the Participant would have received had the Restricted Stock Unit or Restricted Share vested immediately
prior to the Change in Control. The Administrator shall have the discretion to provide in each Restricted Stock Unit Agreement
and Stock Issuance Agreement other terms and conditions that relate to vesting of such Restricted Stock Units and Restricted Shares
in the event of a Change in Control. The aforementioned terms and conditions may vary in each Restricted Stock Unit Agreement
and Stock Issuance Agreement, and may be different from and have precedence over the provisions set forth in this Section 10.02.


 






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Article
11.


AMENDMENT
AND TERMINATION OF THE PLAN


 


Section
11.01Amendments. The Board may from time to time alter, amend, suspend or terminate this Plan in such respects as the
Board may deem advisable. No such alteration, amendment, suspension or termination shall be made which shall substantially affect
or impair the rights of any Participant under an outstanding Option Agreement, Restricted Stock Unit Agreement, Stock Appreciation
Right Agreement, or Stock Issuance Agreement without such Participant’s consent. The Board may alter or amend the Plan to
comply with requirements under the Code relating to Incentive Options or other types of options which give Optionees more favorable
tax treatment than that applicable to Options granted under this Plan as of the date of its adoption. Upon any such alteration
or amendment, any outstanding Option granted hereunder may, if the Administrator so determines and if permitted by applicable
law, be subject to the more favorable tax treatment afforded to an Optionee pursuant to such terms and conditions.


 


Section
11.02Plan Termination. Unless this Plan shall theretofore have been terminated, the Plan shall terminate on the tenth
(10th) anniversary of the Effective Date and no Options, Restricted Stock Units, Stock Appreciation Rights, or Restricted Shares
may be granted under the Plan thereafter, but Option Agreements, Restricted Stock Unit Agreements, Stock Appreciation Right Agreements,
and Stock Issuance Agreements then outstanding shall continue in effect in accordance with their respective terms.


 


Article
12.


TAXES


 


Section
12.01Withholding. The Company shall have the power to withhold, or require a Participant to remit to the Company, an amount
sufficient to satisfy any applicable Federal, state, and local tax withholding requirements with respect to any Options, Restricted
Stock Units, Stock Appreciation Rights, or Restricted Shares. To the extent permissible under applicable tax, securities and other
laws, the Administrator may, in its sole discretion and upon such terms and conditions as it may deem appropriate, permit a Participant
to satisfy his or her obligation to pay any such tax, in whole or in part, up to an amount determined on the basis of the highest
marginal tax rate applicable to such Participant, by (a) directing the Company to apply shares of Common Stock to which the Participant
is entitled as a result of the exercise of an Option or Stock Appreciation Right or vesting of a Restricted Stock Unit or Restricted
Share, or (b) delivering to the Company shares of Common Stock owned by the Participant. The shares of Common Stock so applied
or delivered in satisfaction of the Participant’s tax withholding obligation shall be valued at their Fair Market Value
as of the date of measurement of the amount of income subject to withholding.


 






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Section
12.02Compliance with Section 409A of the Code. Options, Restricted Stock Units, Stock Appreciation Rights, and Restricted
Shares will be designed and operated in such a manner that they are either exempt from the application of, or comply with, the
requirements of Section 409A of the Code such that the grant, payment, settlement or deferral will not be subject to the additional
tax or interest applicable under Section 409A of the Code, except as otherwise determined in the sole discretion of the Administrator.
The Plan and each Option Agreement, Restricted Stock Unit Agreement, Stock Appreciation Right Agreement, and Stock Issuance Agreement
is intended to meet the requirements of Section 409A of the Code and will be construed and interpreted in accordance with such
intent, except as otherwise determined in the sole discretion of the Administrator. To the extent that an Option, Restricted Stock
Unit, Stock Appreciation Right, or Restricted Share, or grant, payment, settlement or deferral thereof is subject to Section 409A
of the Code such Option, Restricted Stock Unit, Stock Appreciation Right, or Restricted Share will be granted, paid, settled or
deferred in a manner that will meet the requirements of Section 409A of the Code, such that the grant, payment, settlement or
deferral thereof will not be subject to the additional tax or interest applicable under Section 409A of the Code.


 


Article
13.


MISCELLANEOUS


 


Section
13.01Shareholder Approval of the Plan. The Plan shall be approved by a majority of the outstanding securities entitled
to vote by the later of (i) within twelve (12) months before or after the date the Plan is adopted, or (2) prior to or within
twelve (12) months of the granting of any Incentive Options or Nonqualified Options, or the issuance of any Restricted Stock Units,
Stock Appreciation Rights, or Restricted Shares. If any Incentive Options or Nonqualified Options is exercised, or any Restricted
Stock Units, Stock Appreciation Rights, or Restricted Shares is issued before security holder approval is obtained shall be rescinded
if security holder approval is not obtained in the manner described in the preceding sentence.


 


Section
13.02Benefits Not Alienable. Other than as provided above, benefits under this Plan may not be assigned or alienated,
whether voluntarily or involuntarily. Any unauthorized attempt at assignment, transfer, pledge or other disposition shall be without
effect.


 


Section
13.03No Enlargement of Employee Rights. This Plan is strictly a voluntary undertaking on the part of the Company and shall
not be deemed to constitute a contract between the Company and any Participant to be consideration for, or an inducement to, or
a condition of, the employment of any Participant. Nothing contained in the Plan shall be deemed to give the right to any Participant
to be retained as an employee of the Company or any Affiliated Company or to interfere with the right of the Company or any Affiliated
Company to discharge any Participant at any time.


 


Section
13.04Application of Funds. The proceeds received by the Company from the sale of Common Stock pursuant to Option Agreements,
except as otherwise provided herein, will be used for general corporate purposes.


 


Section
13.05Annual Reports. During the term of this Plan, the Company will furnish to each Participant who does not otherwise
receive such materials, copies of all reports, proxy statements and other communications that the Company distributes generally
to its stockholders, including, but not limited to, financial statements.


 


15