Document:

Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT
(the “Agreement”) is entered into on this 6th day of June, 2014, to be effective as of June 1, 2014
(the “Effective Date”), by and between ERBA Diagnostics, Inc., a Delaware corporation (the “Company”),
and Prakash Patel (the “Executive”).

 

RECITALS

 

WHEREAS, the
Company wishes to employ the Executive as Controller of the Company upon the terms and subject to the conditions set forth in this
Agreement; and

 

WHEREAS, the
Executive is willing to accept such employment on such terms and conditions.

 

NOW, THEREFORE,
in consideration of the premises and of the mutual promises, representations and covenants herein contained, the Company and the
Executive hereby agree as follows:

 

AGREEMENT

 

1.            Scope
of Employment. The Company hereby agrees to employ the Executive, and the Executive hereby agrees to be employed by the
Company, as Controller of the Company. The Executive shall have the customary responsibilities and authority of such position and
shall perform such duties consistent with the responsibilities of such position as may be determined and assigned to the Executive
by the Chief Executive Officer, the Chief Financial Officer, the Executive Chairman of the Company’s Board of Directors (the
“Board”) and the Audit Committee of the Board (the “Audit Committee”). The Executive shall
devote his best efforts and his full business time, attention and energies to Company affairs as are necessary to fully perform
his duties for the Company.

 

2.            At-Will
Employment. The Executive acknowledges and agrees that there is no fixed duration for the Executive’s employment
as Controller of the Company and that the Executive’s employment as Controller of the Company is “at-will” and
may be terminated by the Company in accordance with Section 5. Nothing in this Agreement should be construed as creating
a contract of employment or in any way altering the Executive’s status as an “at-will” employee.

 

3.            Compensation.

 

(a)          Base
Salary. The Company agrees to pay the Executive, and the Executive agrees to accept, in payment for services to be rendered
by the Executive hereunder, an aggregate base salary of $105,000 per annum (the “Base Salary”). The Base Salary
shall be paid in approximately equal installments in accordance with the Company’s customary payroll practices. For all purposes
under this Agreement, the term “Base Salary” shall refer to the Executive’s base salary as in effect from
time to time in accordance with this Section 3(a).

 

    	 

    	 

    

 

(b)          Annual
Bonus. In addition to the Base Salary, the Executive shall also be eligible to receive an annual cash bonus of up to fifteen
percent (15%) of the Base Salary (the “Annual Bonus”) upon the achievement of Company-wide financial performance
targets and personal performance goals as jointly determined by the Chief Executive Officer and the Executive Chairman of the Board.
The Company shall pay the Annual Bonus, if any, in accordance with the terms of the particular bonus, but in no event later than
ninety (90) days after the end of the fiscal year to which the Annual Bonus relates.

 

(c)          Equity
Compensation. The Executive shall be eligible to receive any grants of awards by the Company under and in accordance with
the Company’s equity incentive compensation plans, subject to and in compliance with all applicable laws, rules and regulations,
including, without limitation, the Delaware General Corporation Law. Without limiting the generality of the foregoing, the Company
hereby agrees that it will cause its duly authorized representative to execute that certain Nonqualified Stock Option Agreement,
dated as of the date hereof, the form of which is attached hereto as Exhibit A, pursuant to which the Company shall grant
to the Executive a nonqualified stock option under the Company’s 2009 Equity Incentive Plan to purchase 10,000 shares of
the Company’s common stock, at an exercise price per share equal to the closing price of a share of the Company’s common
stock on the NYSE MKT on the date hereof, which options shall fully vest after three (3) years after the Effective Date, and which
options shall expire on the tenth anniversary of the Effective Date.

 

4.            Reimbursement
of Expenses, Fringe Benefits, Etc.

 

(a)          Business
Expenses. The Company shall pay, or promptly reimburse the Executive for, all reasonable expenses incurred by the Executive
in performing his duties for the Company upon the presentation of reasonably itemized statements of such expenses in accordance
with the Company’s policies and procedures now in effect or as such policies and procedures may be modified from time to
time.

 

(b)          Vacation;
Illness. The Executive shall be entitled to paid vacation, holidays, and sick leave benefits in accordance with the Company’s
policies.

 

(c)          Welfare,
Pension and Incentive Benefit Plans. The Executive shall be entitled to participate in and be covered under all the welfare
benefit plans or programs maintained by the Company from time to time, including, without limitation, all medical, hospitalization,
dental, disability, accidental death and dismemberment and travel accident insurance plans and programs, in each case, subject
to and in compliance with the terms and conditions of such plans and programs. In addition, the Executive shall be eligible to
participate in and be covered under all pension, retirement, savings and other employee benefit and perquisite plans and programs
maintained from time to time by the Company, in each case, subject to and in compliance with the terms and conditions of such plans
and programs.

 

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5.            Termination.
This Agreement, and the Executive’s employment hereunder, may be terminated under the circumstances set forth below.

 

(a)          Death.
This Agreement, and the Executive’s employment hereunder, shall terminate upon the Executive’s death.

 

(b)          Disability.
If, as a result of the Executive’s incapacity due to physical or mental illness, the Executive shall have been substantially
unable to perform his duties hereunder for an entire period in excess of one hundred twenty (120) days in any twelve (12) month
period despite any reasonable accommodation available from the Company, then the Company shall have the right to terminate this
Agreement, and the Executive’s employment hereunder, for “Disability.” The Disability of the Executive
shall be determined by a medical doctor approved by the Company. The Executive shall submit to a reasonable number of examinations
by the medical doctor making the determination of Disability, and the Executive hereby authorizes the disclosure and release to
the medical doctor of all supporting medical records.

 

(c)          For
Any Reason or For No Reason. Each of the Executive and the Company shall have the right to terminate this Agreement, and
the Executive’s employment hereunder, for any reason or for no reason, by providing the other with at least sixty (60) days
prior written notice. Only if the Executive delivers such notice, then the Company may waive its right to such notice period and
cause the effective date of termination of this Agreement, and Executive’s employment hereunder, to be a date that is earlier
than the date specified by the Executive in such written notice, and the Company shall not be obligated to provide the Executive
any compensation or benefits in connection with such waiver of such notice period. In any event, regardless of which party delivers
such notice, during any such notice period, the Company may bar the Executive from the premises of the Company and otherwise instruct
the Executive to not perform the Executive’s duties with the Company.

 

(d)          By
the Company with Cause. The Company shall have the right to terminate this Agreement, and the Executive’s employment
hereunder, for Cause (as hereinafter defined). For purposes of this Agreement, the Company shall have “Cause”
to terminate this Agreement, and the Executive’s employment hereunder:

 

(i)          upon
the Indictment (as hereinafter defined) or conviction of, or plea of nolo contendere by, the Executive for (A) a felony or (B)
any misdemeanor involving moral turpitude, deceit, dishonesty or fraud;

 

(ii)         upon
a material violation of the policies and procedures of the Company, including, without limitation, the Company’s policies
with respect to insider trading and sexual harassment, in each case, as in effect from time to time;

 

(iii)        upon
the Executive’s gross negligence, willful misconduct or insubordination with respect to the Company or any Affiliate (as
hereinafter defined) of the Company; or

 

(iv)        upon
a material breach by the Executive of any of the Executive’s material obligations under this Agreement.

 

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For purposes of this Agreement, the term
“Indictment” shall mean an indictment, probable cause hearing or any other procedure pursuant to which an initial
determination of probable or reasonable cause with respect to such offense is made. For purposes of this Agreement, the term “Affiliate,”
when used with respect to a specified person or entity, means any other person or entity in control of, controlled by or under
common control with such specified person or entity.         

 

In the event a final determination is made
by a court of competent jurisdiction that the Company’s termination of this Agreement, and the Executive’s employment
hereunder, under this Section 5(d), does not meet the definition of Cause, then this Agreement, and the Executive’s
employment hereunder, will be deemed to have been terminated by the Company without Cause.

 

The Company shall provide the Executive
with written notice describing any event or condition that gives the Company Cause for terminating this Agreement and the Executive’s
employment hereunder. Only in the case of conduct described in clause (iv) above, Cause will not be considered to exist unless
the Executive is given thirty (30) days after the date of such written notice to cure such breach to the reasonable satisfaction
of the Board. If the Executive cures such breach to the reasonable satisfaction of the Board within such thirty (30) day period,
then the Company shall not be entitled to terminate this Agreement, and the Executive’s employment hereunder, for Cause.

 

6.            Termination
Procedure.

 

(a)          Notice
of Termination. Any termination of this Agreement, and the Executive’s employment hereunder, whether by the Company
or by the Executive, except as a result of the Executive’s death, shall be communicated by written notice of termination
to the other party hereto in accordance with Section 15. Such notice of termination shall state the specific termination
provision in this Agreement relied upon in terminating this Agreement, and the Executive’s employment hereunder, and the
notice of termination shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for such termination.

 

(b)          Date
of Termination. The effective date of any termination of this Agreement, and the Executive’s employment hereunder,
whether by the Company or by the Executive, shall be, in the event of the Executive’s death, the date of his death, or, in
the event of termination for any other reason, the date of termination set forth in such notice of termination, subject to any
applicable notice or cure periods described in Section 5.

 

7.            Effects
of Termination.

 

(a)          Termination
Compensation and Benefits. If this Agreement, and the Executive’s employment hereunder, is terminated, then: (i)
the Company shall pay to the Executive promptly after the effective date of termination that portion of the Executive’s Base
Salary which has been fully earned but not yet paid to the Executive and which is not subject to a deferral election or deferral
requirement that has become irrevocable; and (ii) all unvested awards by the Company under the Company’s equity incentive
compensation plans and other equity compensation in the Company granted to the Executive shall be forfeited.

 

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(b)          Acknowledgements.
The Executive acknowledges and agrees that the compensation and benefits set forth in this Section 7 constitute liquidated
damages upon the termination of this Agreement, and the Executive’s employment hereunder, and the parties hereto have agreed
that such compensation and benefits are reasonable. The Executive further acknowledges and agrees that he shall have no other remedies
in connection with, or as a result of, any such termination. The Company’s obligations under this Section 7 shall
survive the termination of this Agreement.

 

8.            Restrictive
Covenants.

 

(a)          Executive
Acknowledgements. The Executive acknowledges and agrees that: (i) as a part of the Executive’s employment hereunder,
the Executive shall be afforded access to Confidential Information (as hereinafter defined); (ii) public disclosure or utilization
of such Confidential Information in violation of this Agreement could have a material and adverse impact on the Company and its
business; and (iii) accordingly, the non-disclosure provisions of this Agreement are reasonable and necessary to prevent the improper
use or disclosure of Confidential Information. The Executive further acknowledges and agrees that: (i) that the Company’s
business is international in scope and its products and services are marketed throughout the world; (ii) the Company and its products
and services compete with other businesses and products and services located throughout the world; (iii) the Company provides resources
and training to the Company’s employees (including, without limitation, the Executive) related to the Company’s products
and services and processes that are available only to the Company’s employees and cannot be acquired outside of the Company;
and (iv) accordingly, the non-solicitation, anti-raiding and related restrictive provisions of this Agreement are reasonable and
necessary to protect, among other things, the Company’s goodwill with its customer base, its investment in its employees
and its interests in its Confidential Information.

 

(b)          Non-Disclosure
Obligation. Without the prior written consent of the Company, except as may be required by applicable law, rule or regulation,
the Executive will not, at any time, either during or after his employment with the Company, directly or indirectly, divulge or
disclose to any person or entity, including, without limitation, any future employer, or use for the Executive’s own or others’
benefit or gain, any financial information, prospects, customers, tenants, suppliers, clients, sources of leads, methods of doing
business, intellectual property, plans, products, data, results of tests or any other trade secrets or confidential materials or
like information of the Company, including, without limitation, any and all information and instructions, technical or otherwise,
prepared or issued for the use of the Company (collectively, the “Confidential Information”), it being the intent
of the Company, with which intent the Executive hereby agrees, to restrict the Executive from dissemination or using any like information
that is not readily available to the general public.

 

(c)          Information
is Property of the Company. All books, records, accounts, customer, client and other lists, customer and client street
and e-mail addresses and information (whether in written form or stored in any computer medium) relating in any manner to the business,
operations, or prospects of the Company, whether prepared by the Executive or otherwise coming into the Executive’s possession,
shall be the exclusive property of the Company and shall be returned immediately to the Company upon the termination of the Executive’s
employment with the Company, or at the Company’s request at any time. Upon the termination of the Executive’s employment
with the Company, the Executive shall immediately deliver to the Company all lists, books, records, schedules, data and other information
(including all copies thereof) of every kind relating to or connected with the Company and its activities, business and customers.

 

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(d)          Covenant
Not to Solicit. The Executive agrees that, during the period that the Executive is employed by the Company hereunder and
for a period of one (1) year thereafter, (such one (1) year period, the “Post-Employment Restricted Period”),
the Executive shall not, without the prior written consent of the Company, directly or indirectly, interfere with or disrupt or
diminish or attempt to disrupt or diminish, or take any action that could reasonably be expected to disrupt or diminish, any past,
present or prospective relationship, contractual or otherwise, between the Company and any customer, supplier, consultant, advisor,
employee or independent contractor of the Company.

 

(e)          No
Raiding. The Executive agrees that, during the period that the Executive is employed by the Company hereunder and throughout
the Post-Employment Restricted Period, the Executive shall not, without the prior written consent of the Company, directly or indirectly,
solicit, recruit, employ or otherwise engage as an employee, independent contractor, consultant or advisor or attempt to solicit,
recruit, employ or otherwise engage as an employee, independent contractor, consultant or advisor, any person who is or was an
employee, independent contractor, consultant or advisor of or to the Company at any time during the Executive’s last twelve
(12) months of employment with the Company, or in any manner induce or attempt to induce any person who is or was during the Executive’s
last twelve (12) months of employment with the Company an employee, independent contractor, consultant or advisor of or to the
Company to terminate that person’s relationship with the Company.

 

(f)          Non-Disparagement.
The Executive agrees that he will not, directly or indirectly, disparage the Company or disseminate, or cause or permit others
to disseminate, negative statements regarding the Company or any employee, officer, director or agent of the Company. The Company
agrees that it will not, directly or indirectly, disparage the Executive or disseminate, or cause or permit others to disseminate,
negative statements regarding the Executive. Notwithstanding the foregoing, neither the Executive nor the Company is barred or
otherwise restricted from complying with applicable laws, rules and regulations.

 

(g)          Survival.
The obligations contained in this Section 8 shall survive the termination of this Agreement.

 

9.            Enforcement
and Remedies.

 

(a)          Enforcement.
It is the desire and intent of the Company and the Executive that the provisions of this Agreement be enforced to the fullest extent
permissible under the laws, rules, regulations and public policies applied in each jurisdiction in which enforcement is sought.
Accordingly, although the Executive and the Company consider the provisions of this Agreement to be reasonable for the purpose
of preserving and protecting the legitimate interests of the Company, if any particular provision of this Agreement shall be adjudicated
to be invalid or unenforceable, such provision shall be deemed amended to delete the portion thus adjudicated to be invalid or
unenforceable, such deletion to apply only with respect to the operation of such provision in the particular jurisdiction in which
such adjudication is made. Additionally, it is expressly understood and agreed that, although the Company and the Executive consider
the provisions contained in this Agreement to be reasonable, if a final determination is made by a court of competent jurisdiction
that the time or territory or any other restriction contained in this Agreement, including, without limitation, in Section 8,
is unenforceable against the Executive, then the provisions of this Agreement shall be deemed amended to apply as to such maximum
time and territory and to such maximum extent as such court may judicially determine or indicate to be enforceable.

 

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(b)          Remedies.
The Company and the Executive acknowledge that the Company’s damages at law would be an inadequate remedy for the breach
or threatened breach by the Executive of any provision of Section 8. Accordingly, the Company and the Executive agree, in
the event of any such breach or threatened breach, that the Company shall be entitled to temporary and permanent injunctive or
other equitable relief restraining the Executive from such breach or threatened breach, as the Company may deem appropriate, without
the accounting of all earnings, profits, and other benefits arising from any such breach or threatened breach. The rights of the
Company under this paragraph shall be cumulative and in addition to any other rights or remedies available to the Company hereunder
or at law or in equity.

 

10.           Withholding.
The Company shall withhold and deduct such amounts from any compensation or other benefits payable to the Executive under this
Agreement on account of payroll and other taxes and similar items as may be required by applicable law, rule or regulation.

 

11.           Successors;
Binding Agreement. This Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto and their
respective heirs, successors, permitted assigns and personal representatives.

 

(a)          The
Company’s Successors. The rights or obligations of the Company under this Agreement may be assigned or transferred,
in whole or in part, to any successor in interest of the Company or its business. As used in this Agreement, “Company”
shall mean the Company as herein before defined and any successor (whether direct or indirect, by purchase, merger, consolidation
or otherwise) to all or substantially all of the equity, business and/or assets of the Company.

 

(b)          The
Executive’s Successors. No rights or obligations of the Executive under this Agreement may be assigned or transferred,
other than his rights to payments or benefits hereunder, which may be transferred only by will or the laws of descent and distribution.
Upon the Executive’s death, this Agreement and all rights of the Executive hereunder shall inure to the benefit of, and be
enforceable by, the Executive’s beneficiary or beneficiaries, personal or legal representatives or estate, to the extent
any such person succeeds to the Executive’s interests under this Agreement. The Executive shall be entitled to select and
change a beneficiary or beneficiaries to receive any benefit or compensation payable hereunder following the Executive’s
death by giving the Company written notice thereof. In the event of the Executive’s death or a judicial determination of
the Executive’s incompetence, references in this Agreement to the “Executive” shall be deemed, where appropriate,
to refer to the Executive’s beneficiary(ies), estate or other legal representative(s). If the Executive should die following
the effective date of termination of his employment while any amounts would still be payable to the Executive hereunder if he had
continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement
to such person or persons so appointed in writing by the Executive, or otherwise to the Executive’s legal representatives
or estate.

 

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12.           Indemnity.
The Company shall, to the fullest extent permitted under the Delaware General Corporation Law, indemnify and hold harmless the
Executive from and against any and all liabilities, costs and expenses, including, but not limited to, amounts paid in satisfaction
of judgments, in settlement or as fines or penalties, and counsel fees and disbursements, reasonably incurred by the Executive
in connection with the defense or disposition of, or otherwise in connection with or resulting from, any action, suit or other
proceeding, whether civil, criminal, administrative or investigative, before any court or administrative or legislative or investigative
body, in which the Executive may be or may have been involved as a party or otherwise or with which the Executive may be or may
have been threatened, while in office or thereafter, by reason of the Executive’s being an executive officer of the Company
or by reason of any action taken or not taken in such capacity, except with respect to any matter as to which the Executive shall
have been finally adjudicated by a court of competent jurisdiction not to have acted in good faith or in a manner he reasonably
believed to be in or not opposed to the best interests of the Company or, with respect to any criminal action or proceeding, had
no reasonable cause to believe his conduct was unlawful.

 

13.           Entire
Agreement. This Agreement contains the entire understanding between the Company and the Executive and supersedes any and
all other oral and written agreements or understandings between them.

 

14.           Controlling
Law. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the
State of Florida, without regard to its conflicts of law principles. Each of the Company and the Executive unconditionally and
irrevocably agrees that the exclusive forum and venue for any action, suit or proceeding shall be in Miami-Dade County, Florida,
and each consents to submit to the exclusive jurisdiction, including, without limitation, personal jurisdiction, and forum and
venue of the Circuit Courts of the State of Florida or the United States District Court for the Southern District of Florida, in
each case, located in Miami-Dade County, Florida.

 

15.           Notice.
All notices or other communications that are required or permitted hereunder shall be in writing and delivered personally, or sent
by nationally-recognized, overnight courier or by registered or certified mail, return receipt requested and postage prepaid, addressed
as follows:

 

	If to the Company, then to:	ERBA Diagnostics, Inc.
	 	14100 NW 57th Court
	 	Miami Lakes, FL  33014
	 	Attention: Executive Chairman

 

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	with a copy to:	Stearns Weaver Miller Weissler
	 	Alhadeff & Sitterson, P.A.
	 	150 West Flagler Street, Suite 2200
	 	Miami, FL  33130
	 	Attention: David Seifer, Esq.
	 	 
	If to the Executive, then to:	Prakash Patel
	 	14100 NW 57th Court
	 	Miami Lakes, FL 33014
	 	 
	with a copy to:	___________________
	 	___________________
	 	___________________
	 	___________________

 

or to such other address as either party
may furnish to the other in writing in accordance herewith. All such notices and other communications shall be deemed to have been
received (i) in the case of personal delivery, on the date of such delivery, (ii) in the case of delivery by nationally-recognized,
overnight courier, on the first business day immediately following dispatch and (iii) in the case of mailing as described above,
on the third business day following such mailing.

 

16.           Amendment
and Waiver.  No provision of this Agreement may be amended, modified or canceled unless such amendment, modification
or cancellation is agreed to in a writing signed by the Executive and by a duly authorized officer of the Company, and no provision
of this Agreement may be waived unless such waiver is set forth in a writing signed by the party to be charged. No waiver by either
party hereto at any time of any breach by the other party hereto of any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent
time.

 

17.           Survival
of Rights and Obligations. The respective rights and obligations of the Executive and the Company set forth in this Agreement
shall survive the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations.

 

18.           Validity.
If any provision of this Agreement shall for any reason be finally held illegal, invalid or unenforceable by a court or agency
of competent jurisdiction, such provision shall be modified by such court or the parties, as the case may be, so as to cause such
provision to be legal, valid and enforceable to the maximum extent permitted by law (and to the extent modified, it shall be modified
so as to reflect, to the extent possible, the intent of the parties) and shall in no way affect or impair the legality, validity
or enforceability of the remaining provisions of this Agreement, which shall remain in full force and effect, and this Agreement
shall be interpreted as if such illegal, invalid or unenforceable provision was not contained in this Agreement.

 

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

 

20.           Headings.
The section and paragraph headings in this Agreement are for convenience of reference only and in no way define, limit or describe
the scope of this Agreement or the intent of any provision hereof.

 

[ SIGNATURES ON FOLLOWING PAGE ]

 

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IN WITNESS WHEREOF, each
of the parties hereto has duly executed this Agreement as of the date and year first above written to be effective as of the Effective
Date.

 

	 	THE COMPANY:
	 	 
	 	ERBA Diagnostics, Inc.,
	 	a Delaware corporation
	 	 
	 	By:	/s/ Suresh Vazirani
	 	Name: Suresh Vazirani
	 	Title: Executive Chairman
	 	 
	 	THE EXECUTIVE:
	 	 
	 	/s/ Prakash Patel
	 	Prakash Patel

 

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EXHIBIT A

 

FORM OF NONQUALIFIED STOCK OPTION
AGREEMENT

 

ERBA DIAGNOSTICS, INC.

Nonqualified Stock Option Award Agreement

(Employee)

 

1.          Grant
of Stock Option. In accordance with and subject to the terms and conditions of (a) the ERBA Diagnostics, Inc. 2009 Equity Incentive
Plan, as it may be amended from time to time (the “Plan”), a copy of which is attached hereto as Exhibit
A, and (b) this Nonqualified Stock Option Award Agreement (the “Award Agreement”), ERBA Diagnostics, Inc.,
a Delaware corporation (the “Company”), grants to the optionee identified on Schedule 1 attached hereto
(the “Optionee”) a nonqualified stock option (the “Stock Option”) to purchase the number
of shares (the “Shares”) of the Company’s common stock, par value $0.01 per share, set forth on Schedule
1, at the per Share exercise price set forth on Schedule 1.

 

2.          Acceptance
by Optionee. The exercise of the Stock Option, or any portion thereof, is conditioned upon acceptance by the Optionee of the
terms and conditions of this Award Agreement, as evidenced by the Optionee’s execution of Schedule 1, and the delivery
to the Company of a copy of Schedule 1 which has been executed by the Optionee.

 

3.          Vesting
of Stock Option. The Stock Option shall become exercisable in accordance with the vesting schedule set forth on Schedule
1. If the Optionee’s employment agreement with the Company, dated effective as of June 1, 2014 (the “Employment
Agreement”), and the Executive’s employment thereunder, is terminated for any reason whatsoever (including, without
limitation, by reason of the Optionee’s death or Disability, by the Company with Cause or for any reason or for no reason,
or by the Optionee for any reason or for no reason (each of the foregoing terms, as defined in the Employment Agreement)) prior
to the date on which the Stock Option, or any portion thereof, becomes vested, then: (a) the non-vested portion of the Stock Option
will thereupon automatically terminate and be void and will not become exercisable; and (b) the vested portion of the Stock Option
will survive and will be exercisable until the earlier of the Expiration Date and the date which is thirty (30) days after the
effective date of termination of the Employment Agreement and the Optionee’s employment thereunder, and, upon the earlier
to occur of the foregoing, the vested portion of the Stock Option will automatically terminate and be void and will not be exercisable.

 

4.          Expiration
of Stock Option. The Stock Option shall expire on the expiration date set forth on Schedule 1 (the “Expiration
Date”), and may not be exercised after such date.

 

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5.          Procedure
for Exercise. The Stock Option may be exercised for the number of Shares specified in a written notice which has been executed
by the Optionee and delivered to the Company at least ten (10) days prior to the date on which purchase is requested, accompanied
by full payment for the Shares with respect to which the Stock Option is being exercised, in the manner and subject to the terms
and conditions set forth in the Plan. Notwithstanding the foregoing, the Stock Option may not be exercised as to less than ten
(10) Shares at any time or, if less than ten (10) Shares, the number of Shares subject to the Stock Option. If any applicable law,
rule or regulation requires the Company to take any action with respect to the Shares specified in such notice or if any action
remains to be taken under the Certificate of Incorporation or Bylaws of the Company, as they may be amended from time to time,
to effect due issuance of the Shares, then the Company shall take such action and the day for delivery of such Shares shall be
extended for the period necessary to take such action. Neither the Optionee nor any other Person entitled to exercise the Stock
Option, if any, shall be, or have any rights or privileges of, a stockholder of the Company in respect of any of the Shares issuable
upon exercise of the Stock Option, unless and until the Shares are issued to the Optionee by the Company.

 

6.          No
Right to Employment. Neither the grant of the Stock Option nor the issuance of any Shares pursuant to the Stock Option shall
give the Optionee any right to be employed or retained in the employ of the Company. Neither the grant of the Stock Option nor
the issuance of any Shares pursuant to the Stock Option shall affect the right of the Company to discharge or discipline the Optionee
or the right of the Optionee to terminate his or her employment.

 

7.          Return
of Economic Value. If the Optionee’s employment with the Company or its subsidiaries ceases by reason of termination
by the Company “with cause” (as “with cause” may be determined under the procedures established by the
Committee for purposes of the Plan), then the Committee may require the Optionee to return to the Company the economic value of
the Stock Option, or any portion thereof, which was realized or obtained by the Optionee at any time during the period beginning
on the date which is twelve (12) months prior to the date of such cessation of the Optionee’s employment with the Company
or its subsidiaries. If the Optionee’s employment with the Company or its subsidiaries ceases for any reason whatsoever and
if, within one (1) year after such cessation thereof, the Optionee accepts employment with any competitor of, or otherwise engages
in competition with, the Company or its subsidiaries, then the Committee may require the Optionee to return to the Company the
economic value of the Stock Option, or any portion thereof, which was realized or obtained by the Optionee at any time during the
period beginning on the date which is twelve (12) months prior to the date of the Optionee’s cessation of employment with
the Company or its subsidiaries.

 

8.          Representations
as to Purchase of Shares. As a condition of the Company’s obligation to issue Shares upon exercise of the Stock Option,
if requested by the Company, then the Optionee shall, concurrently with the delivery of the stock certificate representing the
Shares so purchased, give such written assurances to the Company, in the form and substance that the Company’s counsel reasonably
requests, to the effect that the Optionee is acquiring the Shares for investment and without any present intention of reselling
or redistributing the same in violation of any applicable law, rule or regulation. If the Company elects to register, or has registered,
the Shares under the Securities Act of 1933, as amended, and any applicable state laws, rules and regulations, then the issuance
of such Shares shall not be subject to the aforementioned conditions contained in this Section 8.

 

    	13

    	 

    

 

9.          Compliance
with Applicable Law. The issuance of the Shares pursuant to the exercise of this Stock Option is subject to compliance with
all applicable laws, rules and regulations, including, without limitation, laws, rules and regulations governing withholding from
employees and nonresident aliens for income tax purposes.

 

IN WITNESS WHEREOF, the Company has caused
this Award Agreement to be executed as of the date of grant set forth on Schedule 1.

 

	 	ERBA Diagnostics, Inc.
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

    	14

    	 

    

 

Schedule 1

to

Nonqualified Stock Option Award Agreement

(Employee)

 

	Name of Optionee:	______________
	Number of Shares:	______________
	Exercise Price Per Share:	______________
	Date of Grant:	______________
	Expiration Date:	______________
	Vesting Schedule:	______________

 

The undersigned agrees to the terms and
conditions of the Nonqualified Stock Option Award Agreement of which this Schedule 1 is a part, and acknowledges receipt
of the prospectus relating to the Plan and of the Company’s most recent annual report to stockholders.

 

	 	 

	 	Name:	 

	 	Social Security No.:	 
	 	Date of Acceptance:	 

 

    	15EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT
(the “Agreement”), dated as of June 9, 2014 between BRAINSTORM CELL THERAPEUTICS, INC, a Delaware limited
company (the “Company”), and ANTHONY FIORINO, MD, Ph.D (the “Executive”).

 

WHEREAS, the Company desires
to employ the Executive, and the Executive desires to be employed by the Company, upon the terms and conditions set forth herein;

 

NOW, THEREFORE, in consideration
of the mutual premises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

 

1.          Employment.
The Company hereby employs the Executive, and the Executive agrees to accept such employment, upon the terms and conditions herein
set forth.

 

2.          Employment
Period. The term of employment hereunder shall commence on the date hereof and continue until terminated as provided herein
(the “Employment Period”). Executive’s employment with the Company is “at will” and not for
a fixed term and is subject to termination in accordance with this Agreement.

 

3.          Position
and Duties. The Executive hereby agrees to serve as Chief Executive Officer of the Company (and its subsidiaries, but for no
additional compensation), and shall have those duties, responsibilities and authority customarily accorded a person holding such
positions in a company such as the Company. In such capacity, the Executive shall report to the Board of Directors of the Company
(the “Board”). The Executive shall devote his best efforts and his full business time and attention to the performance
of services to the Company in accordance with the terms hereof and as may reasonably be requested by the Company. Executive shall
not engage in any other business or professional activities, either on a full-time or part-time basis, as an employee, consultant
or in any other capacity, whether or not he receives any compensation therefor, without the prior written consent of the Company;
provided, however, that nothing herein shall prevent the Executive from (a) making and managing personal investments consistent
with Section 9 of this Agreement and any applicable Company policies, (b) engaging in community and/or charitable activities, including
serving as a trustee or Board member of charitable organizations, (c) engaging in industry-related activities such as serving on
the Board or committees of industry organizations, for example but not limited to PhRMA or BIO, or (d) serving as a Board member
of up to two (2) pharmaceutical or biotechnology companies, so long as any of such activities, either singly or in the aggregate,
do not interfere with the proper performance of the Executive’s duties and responsibilities to the Company or conflict or
compete with the Company's activities as currently conducted or as proposed to be conducted at any time.

 

    	 

    	 

    

 

4.          Compensation
and Other Terms of Employment.

 

(a)          Compensation.
In consideration of the performance of his duties for the Company, the Executive shall be entitled to receive base compensation
during the first year of the Employment Period at the rate of $275,000 per year (the “Base Salary”). At the
conclusion of each year of employment, the Executive’s Base Salary shall be increased over the prior year’s Base Salary
by an amount no less than $7,500. During the Employment Period, the Board (or a committee thereof) may, at its sole discretion,
additionally increase the Base Salary, but shall not decrease the Base Salary below the foregoing specified first year Base Salary
and any accrued annual increments without Executive’s prior written consent. No additional compensation shall be payable
to the Executive by reason of the number of hours worked or any hours worked on Saturdays, Sundays or holidays, by reason of special
responsibilities assumed (whether on behalf of the Company or any of its subsidiaries or affiliates), special projects completed,
or otherwise. All Base Salary payable hereunder shall be payable in accordance with the Company’s regular payroll practices
(e.g., timing of payments and standard employee deductions, such as income and employment tax withholdings).

 

(b)          Bonus
Compensation. The Executive shall be eligible to receive an annual performance bonus subject to satisfaction of pre-established
performance goals to be mutually agreed upon by the Board (or a committee thereof) and the Executive (the “Bonus Compensation”).
In addition, at the Board’s (or a committee thereof’s) discretion, it may award additional or other Bonus Compensation
to the Executive. Bonus Compensation may include cash, equity, or equity derivatives (e.g., warrants or options), and non-cash
Bonus Compensation may be subject to vesting. Any amounts due to Executive pursuant to this Section 4(b) shall payable, if in cash,
or issued, if in equity or equity derivatives, no later than sixty (60) days following the adoption of the annual financial statements
of the previous fiscal year of the Company.

 

(c)          Initial
Option Grant. The Company shall issue to the Executive on the Executive’s start
date, an option (the “Initial Options”) to purchase 5,700,000 shares of Company common stock under the Company’s
Amended and Restated 2005 U.S. Stock Option and Incentive Plan, or successor plan thereto
(the “Plan”). This option’s exercise price will be equal the closing price of the Company’s common stock
(during normal trading hours) on the date of grant. Provided the Executive remains employed by the Company on each vesting date,
the vesting schedule of the option shall be as follows: 25% of the shares underlying the option shall vest and become exercisable
on the first anniversary of the date of grant and 2.0833% of the shares underlying the option shall vest and become exercisable
on each monthly anniversary date of the date of grant starting on the 13th monthly anniversary date of the date of grant
through the fourth anniversary of grant, so that the option becomes fully vested and exercisable on the fourth anniversary of the
date of grant. The option shall have a ten (10) year term. Any unvested shares underlying the option as of the date
of the employment termination shall automatically terminate. The Executive shall have 90 days after termination of Executive’s
employment with the Company to exercise the option to the extent then vested.

 

    	 

    	 

    

 

(d)          Equity
Incentive Plan. During the Term, Executive shall be entitled to participate in the Plan and receive such stock options or other
equity awards relating to the equity of the Company as determined by the Board (or the Compensation Committee of the Board) in
its sole and absolute discretion.

 

(e)          Business
Expenses. Upon presentation of vouchers and similar receipts, the Executive shall be entitled to receive reimbursement in accordance
with the policies and procedures of the Company maintained from time to time for all reasonable business expenses actually incurred
in the performance of his duties for the Company.

 

(f)          Vacation.
The Executive shall be entitled to vacation during each year of the Employment Period in accordance with the Company’s policies
(which have not yet been adopted by the Company) in effect from time to time applicable to other members of the Company’
senior management; provided that the Executive shall be entitled to no less than four weeks of vacation per fiscal year.

 

(g)          Benefits.
The Executive shall be entitled to participate in such employment benefits, including but not limited to a Section 401(k) retirement
plan, health, dental, life insurance, and long term disability plans as are established by the Company and as in effect from time
to time applicable to executives of the Company. The Company shall provide health and dental insurance plans or, if the Company
is unable to provide such plans, the Company will reimburse the Executive for his health and dental insurance costs. The Company
shall not be required to establish, continue or maintain any other specific benefits or benefit plans other than health and dental
insurance.

 

(h)          [RESERVED]

 

(i)          No
Additional Compensation. Except as provided in this Section 4 or as determined in the discretion of the Compensation Committee
of the Board, the Executive shall not be entitled to any other compensation, salary or bonuses for services as an employee of Company.

 

5.          Termination
and Consequences.

 

(a)          The
Executive’s Rights to Terminate. Notwithstanding any other provision of this Agreement to the contrary, the Executive
may terminate this Agreement at any time, (i) for Good Reason (as defined in Section 5(h) below), or (ii) without Good Reason on
(i) 30 days' prior written notice to the Company through the first anniversary of the date of this agreement; (ii) 60 days' prior
written notice following the first anniversary and through the second anniversary of the date of this agreement; and (iii) 90 days'
prior written notice following the second anniversary of the date of this agreement.

 

(b)          The
Company's Right to Terminate. Notwithstanding any other provision of this Agreement to the contrary, the Company may
terminate this Agreement at any time during the term hereof, (i) immediately with Cause (as defined in Section 5(i) below) or (ii)
on (i) 30 days' prior written notice to the Executive through the first anniversary of the date of this agreement; (ii) 60 days'
prior written notice following the first anniversary and through the second anniversary of the date of this agreement; and (iii)
90 days' prior written notice following the second anniversary of the date of this agreement, without Cause.

 

    	 

    	 

    

 

(c)          Consequences
of Termination without Cause or for Good Reason. If the Company terminates this Agreement or Executive’s employment hereunder
without Cause or if the Executive terminates this Agreement or his employment hereunder with Good Reason (and the Company would
not otherwise have substantially the right to terminate Employee for Cause), the Company shall (i) continue to pay the Executive,
as severance pay, his Base Salary pursuant to the Company's regular payroll schedule for a period equal to four (4) months (which
shall increase to six (6) months after the first anniversary of the date of this Agreement and nine (9) months after the second
anniversary of the date of this Agreement) (assuming Executive is actively employed by the Company on such dates) from the date
that the Executive’s receives notice of termination of his employment with the Company (the “Payment Period”)
or issue within 15 days of his termination a lump sum payment equivalent to such number of months of base salary; and (ii) pay
the Executive within 30 days of his termination of employment (or such revised payment period pursuant to Section 11(o) of this
Agreement) any Bonus Compensation that the Executive would be entitled to receive during the Payment Period in the absence of his
termination without Cause or for Good Reason; (iii) immediately vest such number of options that would have vested during the following
6 months following the date of notice of termination and (iv) shall continue to provide to Executive health insurance benefits
contemplated under Section 4(g) during the Payment Period. In the event that the Executive is no longer eligible for health insurance
benefits as provided by the Company benefit plan, then the Company shall pay for Executive’s health insurance premiums under
COBRA for such period. The Company shall pay for Executive’s health insurance premiums under COBRA for the duration of Payment
Period from the date of termination under this clause (c). In the event that the Company’s health insurance plan is discontinued
or otherwise not eligible for COBRA, or if the Executive is not eligible to receive benefits under COBRA, then the Company will
reimburse the Executive for his health insurance costs for the duration of Payment Period from the date of termination under this
clause (c). Should the Executive becomes eligible for health insurance benefits provided by a new employer during the duration
of Payment Period, then the Company’s obligation to reimburse the Executive for health insurance costs will terminate when
the Executive’s new health insurance benefit begins. In the event that the Executive is entitled to severance benefits under
Section 5(f) below, this Section 5(c) shall not apply and shall have no further force or effect.

 

(d)          Consequences
of Termination With Cause or Without Good Reason. If the Company terminates this Agreement or Executive’s employment
hereunder with Cause or the Executive terminates this Agreement or his employment hereunder without Good Reason, then (i) Employee's
Base Salary shall be discontinued upon the termination of the Agreement or his employment hereunder, (ii) no Bonus Compensation
shall be payable for the year in which the termination with Cause or without Good Reason occurs, (iii) to the extent permitted
by applicable law, the Executive shall cease to be entitled to participate in any benefit plans or programs maintained by the Company,
and (iv) Executive shall forfeit all rights to any unexercised Company stock options if terminated by the Company for Cause and
with shall forfeit all rights with respect to any Company unvested restricted stock if terminated by the Company for Cause or if
terminated by the Executive without Good Reason.

 

    	 

    	 

    

 

(e)          Consequences
of Termination for Death or Disability. If the Executive dies or is unable to perform his duties hereunder because of a Disability
(as defined herein) during the term of this Agreement, then the Agreement shall terminate, except that the Company shall pay within
thirty (30) days of such event (or such revised payment period pursuant to Section 11(o) of this Agreement) all accrued Base Salary
and any Bonus Compensation that the Executive would otherwise have been entitled to receive through the date that the Executive’s
employment with the Company is terminated and for a period of three (3) months thereafter. In the case of a Disability, the Executive
shall also receive any applicable payments and benefits pursuant to any disability plan or policy sponsored or maintained by the
Company. The unvested Initial Options shall remain outstanding in accordance with their existing terms and conditions.

 

(f)          Consequences
Upon Termination Following Change of Control. If at any time within twelve (12) months after a Change of Control of the Company
(as defined herein) has occurred, the Executive's employment is terminated (x) by the Company or any successor company for any
reason other than for Cause or the Executive's Disability or death (y) or by Executive due to a Change of Control Termination (as
hereinafter defined) (any such termination under Section 5(f)(x) or 5(f)(y), a “5(f) Termination”), the Company
shall pay or provide Executive with the following within thirty (30) days of such 5(f) Termination of employment (or such revised
payment period pursuant to Section 11(o) of this Agreement):

 

(i)          All
Base Salary up through the date of such 5(f) Termination, which shall be paid in accordance with the Company's normal payroll practices
as currently in effect;

 

(ii)         Payment
equal to one (1) times Executive's target Bonus Compensation for the year in which the Change of Control immediately preceding
the 5(f) Termination occurs;

 

(iii)        Base
Salary for twelve (12) months following the date of such 5(f) Termination; and

 

(iv)         Acceleration
in full of the vesting and exercisability of all Company stock options granted to the Executive which are outstanding and otherwise
unvested immediately prior to such 5(f) Termination. Such accelerated options shall remain exercisable for no less than a period
of 60 days following such 5(f) Termination (but not to exceed the original term of such awards).

 

Notwithstanding anything
to the contrary, no compensation of any kind shall be payable to the Executive pursuant to this Section 5(f) or pursuant to Section
5(c) unless or until Executive executes and delivers a full and general waiver and release to the Company (in favor of the Company,
its successors, assigns, Board members, officers, employees, affiliates, subsidiaries, parent companies and representatives, in
a form reasonable acceptable to the Company, such waiver and release to be delivered by Executive within 10 days after termination
of his employment (unless applicable law requires a longer time period, in which case this date will be extended to the minimum
time required by applicable law).

 

    	 

    	 

    

 

(g)          Fringe
Benefits. In the case of termination under Sections 5(a), (b), (d) or (e) above, inclusive, subject to applicable law, the
Company shall discontinue any other benefits and perquisites provided under Section 4 above that are not otherwise provided for
effective as of the date that the Company's obligation to pay Base Salary terminates.

 

(h)          Definition
of Good Reason. “Good Reason” means (i) a material reduction of the Executive's Base Salary and benefits
from the levels provided herein, (ii) a material reduction of Executive’s duties and responsibilities from those in effect
immediately prior to the reduction, or (iii) material breach by the Company of any provision of this Agreement after receipt of
written notice thereof from the Executive and failure by the Company to cure the breach within thirty (30) days thereafter. A termination
by the Executive under Sections 5(h)(i), 5(h)(ii) and/or 5(h)(iii) will not be considered a termination for Good Reason unless
within thirty (30) days of the last event relied upon by the Executive to establish Good Reason the Executive furnishes the Company
with a written statement specifying the reason or reasons why he believes he is entitled to terminate his employment for Good Reason
and affords the Company at least thirty (30) days during which to refute that statement or remedy the cause thereof. Such 30-day
notice period may run concurrently with the 30-day notice specified in Section 5(a) above.

 

(i)          Definition
of Cause. “Cause” means a good faith finding by the Company of: (i) gross
negligence or willful misconduct by Executive in connection with Executive’s employment duties, (ii) commission of acts of
fraud, misrepresentation, embezzlement, theft, dishonesty or breach of the duty of loyalty in performance of the Executive’s
duties on behalf of the Company, or any embezzlement or other financial fraud committed by Executive, (iii) willful or repeated
failure to follow specific directives of the Board (or its committees or other designees), (iv) failure by Executive to perform
Executive’s duties or responsibilities required pursuant to Executive’s employment, after written notice and an opportunity
to cure, (v) misappropriation by Executive of the assets or business opportunities of the Company or its affiliates, (vi) a
willful and knowing breach by Executive of any representations or warranties included in this Agreement, (vii) Executive knowingly
allowing and not taking all available actions against, any third party to commit any of the acts described in any of the preceding
clauses (ii), (v), or (vi) against the Company, or (viii) Executive’s indictment for, conviction of, or entry of a plea
of no contest with respect to, any felony.

 

(j)          Definition
of Disability. “Disability” means the inability of the Executive to perform the Executive’s
duties of employment to the Company pursuant to the terms of this Agreement, because of physical or mental disability where such
disability shall have existed for a period of more than 60 days in any 270 day period. The existence of a Disability means that
the Executive’s mental and /or physical condition substantially interferes with the Executive’s performance of his
substantive duties for the Company as specified in this Agreement. The fact of whether or not a Disability exists hereunder shall
be determined by a professionally qualified medical expert reasonably chosen by the Company.

 

    	 

    	 

    

 

(k)          Definition
of Change of Control. “Change of Control” means the first to occur
of any of the following: (a) any “person” or “group” (as defined in the Securities Exchange Act of
1934) becomes the beneficial owner of a majority of the combined voting power of the then outstanding voting securities with respect
to the election of the Board of Directors of the Company; (b) any merger, consolidation or similar transaction involving the
Company, other than a transaction in which the stockholders of the Company immediately prior to the transaction hold immediately
thereafter in the same proportion as immediately prior to the transaction not less than 50% of the combined voting power of the
then voting securities with respect to the election of the Board of Directors of the resulting entity; or (c) any sale of
all or substantially all of the assets of the Company. Notwithstanding the foregoing, no change in ACCBT Corp., ACC International
Holdings Ltd. or their affiliates’ ownership of the Company shall be deemed a Change of Control under this Agreement.

 

(l)          Definition
of Change of Control Termination. “Change of Control Termination” means a termination of the Executive’s
employment by the Executive within twelve (12) months after a Change of Control (as defined above), following the occurrence of
any of the following events by the Company or any successor company after such Change of Control:

 

(i)          a
reduction in the Executive's then-current annual base salary or bonus opportunity or benefits (other than in connection with a
salary adjustment generally applicable to similarly situated employees); or

 

(ii)         any
failure to offer the Executive the same level of benefits offered to similarly situated employees; or

 

(iii)        a
significant diminution in the Executive’s duties, title, office, or responsibilities (provided that being the head of this
business unit within a larger company will not result in a significant diminution in Executive’s duties, title, office or
responsibilities); or

 

(iv)         the
relocation of the Executive’s primary business location to a location that increases the Executive's commute by more than
fifty (50) miles compared to the commute of the Executive to the Executive's then-current primary business location; or

 

(v)          the
failure to pay the Employee any portion of his or her current Base Salary, Bonus or benefits within twenty (20) days of the date
such compensation is due, based upon the payment terms currently in effect; or

 

(vi)         the
failure of the Company to obtain a reasonably satisfactory agreement from any successor to assume and agree to perform this Agreement
(if such separate agreement is required by law).

 

    	 

    	 

    

 

6.          Termination
Obligations. The Executive hereby acknowledges and agrees that all personal property and equipment furnished to or prepared
by the Executive in the course of or incident to his employment by the Company belongs to the Company and shall be promptly returned
to the Company upon termination of his employment. “Personal property” includes, without limitation, all books,
manuals, records, reports, notes, contracts, lists, blueprints, and other documents, or materials, or copies thereof (including
computer files), and all other proprietary information relating to the business of the Company or any affiliate. Following termination,
the Executive will not retain any written or other tangible material containing any proprietary information or Confidential Information
(as defined below) of the Company or any affiliate. Upon termination of employment, the Executive shall be deemed to have resigned
from all offices then held with the Company or any affiliate.

 

7.          Records
and Confidential Data.

 

(a)          Acknowledgement.
The Executive acknowledges that in connection with the performance of his duties during the term of his employment the Company
will make available to the Executive, or the Executive will have access to, certain Confidential Information (as defined below)
of the Company and its affiliates. The Executive acknowledges and agrees that any and all Confidential Information learned or obtained
by the Executive during the course of his employment by the Company or otherwise (including, without limitation, information that
the Executive obtained through or in connection with his relationship with the Company prior to the date hereof) whether developed
by the Executive alone or in conjunction with others or otherwise, shall be and is the property of the Company and its affiliates.

 

(b)          Confidentiality
Obligations. During the term of his employment and thereafter Executive shall keep all Confidential Information confidential
and will not use such Confidential Information other than in connection with the Executive’s discharge of his duties hereunder,
and will be safeguarded by the Executive from unauthorized disclosure. This covenant is not intended to, and does not limit in
any way Executive’s duties and obligations to the Company under statutory and common law not to disclose or make personal
use of the Confidential Information or trade secrets.

 

(c)          Return
of Confidential Information. Following the Executive’s termination of employment, upon receipt of a written request from
the Company, the Executive will return to the Company or destroy all written Confidential Information which has been provided to
the Executive and the Executive will destroy all copies of any analyses, compilations, studies or other documents prepared by the
Executive or for the Executive’s use containing or reflecting any Confidential Information. Within ten (10) business days
of the receipt of such request by the Executive, the Executive shall, upon written request of the Company, deliver to the Company
a notarized document certifying that such written Confidential Information has been returned or destroyed in accordance with this
Section 7(c).

 

(d)          Definition.
For the purposes of this Agreement, “Confidential Information” shall mean all confidential and proprietary information
of the Company, and its affiliates and any information obtained by the Company pursuant to a confidentiality obligation to any
third party, including, without limitation, marketing strategies, pricing policies or characteristics, customers and customer information,
product or product specifications, designs, software systems, leasing costs, cost of equipment, customer lists, business or business
prospects, plans, proposals, codes, marketing studies, research, reports, investigations, or other information of similar character.
For purposes of this Agreement, the Confidential Information shall not include and the Executive’s obligations under this
Section 6 shall not extend to (i) information which is generally available to the public, (ii) information obtained by the Executive
from third persons other than Executives of the Company, its subsidiaries, the Company and the Company’s affiliates not under
agreement to maintain the confidentiality of the same and (iii) information which is required to be disclosed by law or legal process.

 

    	 

    	 

    

 

(e)          Construction.
Any reference to the Company in this Section 7 shall include the Company and/or its subsidiaries.

 

8.          Assignment
of Inventions.

 

(a)          Definition
of Inventions. “Inventions” mean discoveries, developments, concepts, ideas, methods, designs, improvements,
inventions, formulas, processes, techniques, programs, know-how and data, whether or not patentable or registerable under copyright
or similar statutes, except any of the foregoing that (i) is not related to the business of the Company or its affiliates, or the
Company’s (and its affiliates’) actual or demonstrable research or development, (ii) does not involve the use of any
equipment, supplies, facility or Confidential Information of the Company, (iii) was developed entirely on the Executive’s
own time, and (iv) does not result from any work performed by the Executive for the Company.

 

(b)          Assignment.
The Executive agrees to and hereby does assign to the Company, without further consideration, all of his right, title and interest
in any and all Inventions he may make during the term hereof.

 

(c)          Duty
to Disclose and Assist. The Executive agrees to promptly disclose in writing all Inventions to the Company, and to provide
all assistance reasonably requested by the Company in the preservation of the Company’s interests in the Inventions including
obtaining patents in any country throughout the world. Such services will be without additional compensation if the Executive is
then employed by the Company and for reasonable compensation and subject to his reasonable availability if he is not. If the Company
cannot, after reasonable effort, secure the Executive’s signature on any document or documents needed to apply for or prosecute
any patent, copyright, or other right or protection relating to an Invention, whether because of his physical or mental incapacity
or for any other reason whatsoever, the Executive hereby irrevocably designates and appoints the Company and its duly authorized
officers and agents as his agent and attorney-in-fact, to act for and on his behalf and in his name and stead for the purpose of
executing and filing any such application or applications and taking all other lawfully permitted actions to further the prosecution
and issuance of patents, copyrights, or similar protections thereon, with the same legal force and effect as if executed by him.

 

    	 

    	 

    

 

(d)          Ownership
of Copyrights. The Executive agrees that any work prepared for the Company which is eligible for United States copyright protection
or protection under the Universal Copyright Convention or other such laws or protections including, but not limited to, the Berne
Copyright Convention and/or the Buenos Aires Copyright Convention shall be a work made for hire and ownership of all copyrights
(including all renewals and extensions) therein shall vest in the Company. If any such work is deemed not to be a work made for
hire for any reason, the Executive hereby grants, transfers and assigns all right, title and interest in such work and all copyrights
in such work and all renewals and extensions thereof to the Company, and agrees to provide all assistance reasonably requested
by the Company in the establishment, preservation and enforcement of the Company’s copyright in such work, such assistance
to be provided at the Company’s expense but without any additional compensation to the Executive. The Executive hereby agrees
to and does hereby waive the enforcement of all moral rights with respect to the work developed or produced hereunder, including
without limitation any and all rights of identification of authorship and any and all rights of approval, restriction or limitation
on use or subsequent modifications.

 

(e)          Litigation.
The Executive agrees to render assistance and cooperation to the Company at its request regarding any matter, dispute or controversy
with which the Company may become involved and of which the Executive has or may have reason to have knowledge, information or
expertise. Such services will be without additional compensation if the Executive is then employed by the Company and for reasonable
compensation and subject to his reasonable availability if he is not.

 

(f)          Construction.
Any reference to the Company in this Section 8 shall include the Company and/or its subsidiaries.

 

9.          Additional
Covenants.

 

(a)          Non-Interference
with Customer Accounts. Executive covenants and agrees that (i) during his employment, except as may be required by Executive’s
employment by the Company, (ii) for a period of one year following the termination of his employment by the Company for Cause or
by the Executive without Good Reason and (iii) for a period of one year following the termination of his employment by the Company
without Cause or by Executive for Good Reason, Executive shall not directly or indirectly, personally or on behalf of any other
person, business, corporation, or entity, contact or do business with any customer of the Company with respect to any product,
business, activity or service which is directly competitive with any product, business, activity or service of the Company in which
the Company is engaged during the term of Executive's employment, or with respect to Executive's covenants regarding the periods
following termination, in which the Company is engaged at the time of termination and/or was engaged during the one year period
prior thereto (a “Company Activity”). By way of example, as of the execution of this agreement, Company Activity
can be defined as the development, marketing and sale of autologous mesenchymal stem cell products expressing neurotrophic factors
for the treatment of neurodegenerative diseases.

 

    	 

    	 

    

 

(b)          Non-Competition.
Subject to matters and activities approved by the Board in writing, the Executive covenants and agrees that (i) during his employment,
and (ii) for a period of one (1) year following the termination of his employment by the Company for Cause or by the Executive
without Good Reason or (iii) for a period equal to the Payment Period, but in no event less than three (3) months following the
termination of his employment by the Company without Cause or by Executive for Good Reason, Executive shall not own a majority
interest in, operate, control, or serve as an executive of any corporation, partnership, proprietorship, firm, association, or
other entity that primarily engages (or engaged) in any Company Activity in which the Company is engaged at the time of termination,
and/or was engaged during the one (1) year period prior thereto. This Covenant (as defined below) applies to Company Activities
in any territory or jurisdiction in which the Company is doing business or is making an active effort to do business at the time
of termination, and/or was engaged during the one (1) year period prior thereto. This Covenant does not prohibit the ownership
of less than one percent (1%) of the outstanding stock of any public corporation, as long as the Executive is not otherwise in
violation of this Covenant.

 

(c)          No
Diversion. Executive covenants and agrees that Executive shall not divert or attempt to divert or take advantage of or attempt
to take advantage of any actual or potential business opportunities of the Company (e.g., joint ventures, other business
combinations, investment opportunities, potential investors in the Company, and other similar opportunities) which the Executive
became aware of as the result of his employment with the Company.

 

(d)          Non-Disparagement.
Executive shall not at any time (whether during or after the termination of his employment) make any statement or disclosure or
otherwise cause or permit to be stated or disclosed any information which is designed, intended or might reasonably be perceived
to be designed or intended to have a negative impact or adverse effect on the Company or its business. Notwithstanding the foregoing,
nothing contained in this Agreement or in this Section 9(d) in particular prohibits the Executive or is intended to prohibit the
Executive from providing truthful information about his employment or the Company to any governmental entity, regulatory agency,
judicial or dispute resolution forum, or to interfere with or prevent the Executive from commencing, defending or participating
fully in a judicial proceeding or dispute resolution process. This Section 9(d) may be raised by th Executive as a complete bar
to any claim of Cause hereunder or any proceeding brought under Section 9(f) to the extent the claim of Cause or the proceeding
concerns a statement or disclosure permissible under this Section 9(d).

 

(e)          Non-Recruitment.
Executive agrees that the Company has invested substantial time and effort in assembling its present workforce. Accordingly, Executive
covenants and agrees that during his employment and for a period of two (2) years following the termination of the Employment Period,
Executive shall not hire away, nor directly or indirectly entice or solicit or seek to induce or influence any of the Company’s
executives to leave their employment.

 

    	 

    	 

    

 

(f)          Remedies.
Executive acknowledges that should he violate any of the covenants contained in Sections 7, 8 and 9(a), (b), (c), and (d) above
(collectively “Covenants”), it will be difficult to determine the resulting damages to the Company and, in addition
to any other remedies it may have, the Company shall be entitled to temporary injunctive relief without being required to post
a bond and permanent injunctive relief without the necessity of proving actual damage. Executive shall be liable to pay all costs
including reasonable attorneys’ fees which the Company may incur in enforcing or defending, to any extent, these Covenants,
whether or not litigation is actually commenced and including litigation of any appeal taken or defended by the Company, where
the Company succeeds in enforcing any part of these Covenants, and the Company shall be liable to pay all costs including reasonable
attorneys’ fees which the Executive may incur in defending, to any extent, any claim that he has violated or intends to violate
any of these Covenants, whether or not litigation is actually commenced and including litigation of any appeal taken or defended
by the Executive, where the Company does not succeeds in enforcing these Covenants. The Company may elect to seek one or more of
these remedies at its sole discretion on a case by case basis. Failure to seek any or all remedies in one case does not restrict
the Company from seeking any remedies in another situation. Such action by the Company shall not constitute a waiver of any of
its rights.

 

(g)          Severability
and Modification of Any Unenforceable Covenant. It is the parties’ intent that each of the Covenants be read and interpreted
with every reasonable inference given to its enforceability. However, it is also the parties’ intent that if any term, provision
or condition of the Covenants is held to be invalid, void or unenforceable, the remainder of the provisions thereof shall remain
in full force and effect and shall in no way be affected, impaired or invalidated. Finally, it is also the parties’ intent
that if it is determine any of the Covenants are unenforceable because of overbreadth, then the covenants shall be modified so
as to make it reasonable and enforceable under the prevailing circumstances.

 

(h)          Tolling.
In the event of the breach by Executive of any Covenant the running of the period of restriction shall be automatically tolled
and suspended for the amount of time that the breach continues, and shall automatically recommence when the breach is remedied
so that the Company shall receive the benefit of Executive’s compliance with the Covenants. This Section shall not apply
to any period for which the Company is awarded and receives actual monetary damages for breach by the Executive of a Covenant with
respect to which this Section applies.

 

(i)          Construction.
Any reference to the Company in this Section 9 shall include the Company and/or its subsidiaries.

 

10.         No
Assignment.

 

This Agreement
and the rights and duties hereunder are personal to the Executive and shall not be assigned, delegated, transferred, pledged or
sold by the Executive without the prior written consent of the Company. The Executive hereby acknowledges and agrees that the Company
may assign, delegate, transfer, pledge or sell this Agreement and the rights and duties hereunder (a) to an affiliate of the Company
or (b) to any third party in connection with (i) the sale of all or substantially all of the assets of the Company or (ii) an equity
purchase, merger, or consolidation involving the Company. This Agreement shall inure to the benefit of and be enforceable by the
parties hereto, and their respective heirs, personal representatives, successors and assigns.

 

    	 

    	 

    

 

11.         Miscellaneous
Provisions.

 

(a)          Payment
of Taxes. Any payments otherwise due under this Agreement to the Executive, including, but not limited to, the Base Salary
and any bonus compensation shall be reduced by any required withholding for federal, state and/or local taxes and other appropriate
payroll deductions.

 

(b)          Notices.
All notices, offers or other communications required or permitted to be given pursuant to this Agreement shall be in writing and
shall be considered as properly given or made (i) if delivered personally or (ii) after the expiration of five days from the date
upon which such notice was mailed from within the United States by certified mail, return receipt requested, postage prepaid, (iii)
upon receipt by prepaid telegram or facsimile transmission (with written confirmation of receipt) or (iv) after the expiration
of the second business day following deposit with documented overnight delivery service. All notices given or made pursuant hereto
shall be so given or made to the following addresses:

 

		if to Executive:	To the Executive’s home address provided

separately to the Company from time to time.

 

		if to the Company:	Chairman of the Board of Directors

Brainstorm Cell Therapeutics Inc.

12 Bazel Street

Petach Tikva 49001,
Israel

 

		with copy to:	Thomas B. Rosedale

BRL Law Group LLC

425 Boylston Street, Floor 3

Boston, MA 02116

Email: trosedale@brllawgroup.com

 

(c)          Severability.
If any provision of this Agreement is held by a court of competent jurisdiction to be invalid, illegal or unenforceable, such provision
shall be severed and enforced to the extent possible or modified in such a way as to make it enforceable, and the invalidity, illegality
or unenforceability thereof shall not affect the validity, legality or enforceability of the remaining provisions of this Agreement.

 

(d)          Governing
Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New Jersey applicable to
contracts executed in and to be performed entirely within that state, except with respect to matters of law concerning the internal
corporate affairs of any corporate entity which is a party to or the subject of this Agreement, and as to those matters, the law
of the jurisdiction under which the respective entity derives its powers shall govern. The parties irrevocably agree that all actions
to enforce an arbitrator’s decision pursuant to Section 11(l) of this Agreement shall be instituted and litigated only in
federal, state or local courts sitting in Newark, New Jersey and each of such parties hereby consents to the exclusive jurisdiction
and venue of such court and waives any objection based on forum non conveniens.

 

    	 

    	 

    

 

(e)          WAIVER
OF JURY TRIAL. THE PARTIES HEREBY WAIVE, RELEASE AND RELINQUISH ANY AND ALL RIGHTS THEY MAY HAVE TO A TRIAL BY JURY WITH RESPECT
TO ANY ACTIONS TO ENFORCE AN ARBITRATOR’S DECISION PURSUANT TO SECTION 11(l) OF THIS AGREEMENT.

 

(f)          Counterparts.
This Agreement may be executed in counterparts, each of which shall be an original, but all of which shall constitute one and the
same instrument.

 

(g)          Entire
Understanding. This Agreement including the Plan, all Exhibits and Recitals hereto which are incorporated herein by this reference,
together with the other agreements and documents being executed and delivered concurrently herewith by the Executive, the Company
and certain of its affiliates, constitute the entire understanding among all of the parties hereto and supersedes any prior understandings
and agreements, written or oral, among them respecting the subject matter within.

 

(h)          Pronouns
and Headings. As used herein, all pronouns shall include the masculine, feminine, neuter, singular and plural thereof wherever
the context and facts require such construction. The headings, titles and subtitles herein are inserted for convenience of reference
only and are to be ignored in any construction of the provisions hereof.

 

(i)          Amendments.
Except as set forth in Sections 9(f) and 11(c) above, this Agreement shall not be changed or amended unless in writing and signed
by both the Executive and the Company.

 

(j)          Executive’s
Representations. Executive hereby represents and warrants to the Company that (i) the execution, delivery and performance of
this Agreement by Executive does not and shall not conflict with, breach, violate or cause default under any contract, agreement,
instrument, order, judgment or decree to which Executive is a party or by which he is bound, (ii) Executive is not a party to or
bound by any employment agreement, noncompete agreement or confidentiality agreement with any other person or entity that restricts
Executive from serving in the position and/or performing the duties set forth herein and (iii) upon the execution and delivery
of this Agreement by the Company, this Agreement shall be the valid and binding obligation of Executive, enforceable in accordance
with its terms. Executive further represents and warrants to the Company that Executive has never (i) filed for personal bankruptcy;
(ii) been the subject of an SEC disciplinary matter or been sanctioned by the SEC; (iii) been convicted or plead no contest to
any crime (other than minor traffic violations); or (iv) been held liable in a court of law for acts of dishonesty in a business
context.

 

(k)          The
Executive’s Acknowledgement. The Executive acknowledges (i) that he has consulted with or has had the opportunity to
consult with independent counsel of his own choice concerning this Agreement and has been advised to do so by the Company, and
(ii) that he has read and understands this Agreement, is fully aware of its legal effect, and has entered into it freely based
on his own judgment.

 

    	 

    	 

    

 

(l)          Arbitration.
Except as provided in Section 11(d) hereof, in the event that there shall be a dispute among the parties arising out of or relating
to this Agreement, or the breach thereof, the parties agree that such dispute shall be resolved by final and binding arbitration
in Newark, New Jersey, administered by the American Arbitration Association (the “AAA”), in accordance with
AAA’s Commercial Arbitration Rules, to which shall be added the provisions of the Federal Rules of Civil Procedure relating
to the Production of Evidence, and the parties agree that the arbitrators may impose sanctions in their discretion to enforce compliance
with discovery and other obligations. Such arbitration shall be presided over by a single arbitrator. If the Executive, on the
one hand, and the Company, on the other hand, do not agree on the arbitrator within fifteen (15) days after a party requests arbitration,
the arbitrator shall be selected by the Company and the Executive from a list of five (5) potential arbitrators provided by AAA.
Such list shall be provided within ten (10) days of the request of any party for arbitration. The party requesting arbitration
shall delete one name from the list. The other party shall delete one name from the list. This process shall then be repeated in
the same order, and the last remaining person on the list shall be the arbitrator. This selection process shall take place within
the two (2) business days following both parties’ receipt of the list of five (5) potential arbitrators. Hearings in the
arbitration proceedings shall commence within twenty (20) days of the selection of the arbitrator or as soon thereafter as the
arbitrator is available. The arbitrator shall deliver his or her opinion within twenty (20) days after the completion of the arbitration
hearings. The arbitrator’s decision shall be final and binding upon the parties, and may be entered and enforced in any court
of competent jurisdiction by either of the parties. The arbitrator shall have the power to grant temporary, preliminary and permanent
relief, including without limitation, injunctive relief and specific performance. Unless otherwise ordered by the arbitrator pursuant
to this Agreement, the arbitrator’s fees and expenses shall be shared equally by the parties.

 

(m)          Attorney's
Fees. If any arbitration is brought under Section 11(l), the arbitrator may award the successful or prevailing party reasonable
attorneys' fees and other costs incurred in that action or proceeding, in addition to any other relief to which it may be entitled.
If any other proceeding is brought by one party against the other in connection with or relating in any manner to this Agreement,
or to enforce an arbitration award, the successful or prevailing party (as determined by an independent third party, e.g.
a judge) shall be entitled to recover its reasonable attorneys’ fees and other costs incurred in that action or proceeding,
in addition to any other relief to which it may be entitled.

 

(n)          Indemnification
of Executive. The Company shall to the fullest extent permitted by law, indemnify, defend and hold harmless the Executive from
any liability, loss or damages incurred by Executive by reason of any act performed by the Executive in connection with the business
of the Company and from liabilities or obligations of the Company imposed on the Executive by virtue of his position with the Company,
including reasonable attorney fees and costs and any amounts expended by the settlement of any such claims of liability, loss or
damages except that no indemnification shall be provided regarding any matter as to which it is finally determined that Executive
did not act in good faith and in the reasonable belief that his action was in the best interests of the Company or with respect
to a criminal matter, that he had reasonable cause to believe that his conduct was unlawful.

 

    	 

    	 

    

 

(o)          Special
Payment Provision. Notwithstanding any provision in the Agreement to the contrary:

 

(i)          This
Agreement is intended to comply with the requirements of Section 409A of the Code ("Section 409A") and regulations promulgated
thereunder such that no payment provided hereunder shall be subject to an "additional tax" within the meaning of Section
409A. To the extent that any provision in this Agreement is ambiguous as to its compliance with Section 409A, the provision shall
be read in such a manner so that all payments due under this Agreement shall not be subject to any additional tax. For purposes
of Section 409A, each payment made under this Agreement shall be treated as a separate payment. In no event may the Executive,
directly or indirectly, designate the calendar year of payment. All reimbursements provided under this Agreement shall be made
or provided in accordance with the requirements of section 409A, including, where applicable, the requirement that (i) any reimbursement
is for expenses incurred during the Executive's lifetime (or during a shorter period of time specified in this Agreement), (ii)
the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement
in any other calendar year, (iii) the reimbursement of an eligible expense will be made on or before the last day of the calendar
year following the year in which the expense is incurred, and (iv) the right to reimbursement is not subject to liquidation or
exchange for another benefit.

 

(ii)         If
payment or provision of any amount or other benefit that is a “deferral of compensation” subject to section 409A of
the Code at the time otherwise specified in this Agreement or elsewhere would subject such amount of benefit to additional tax
pursuant to section 409A(a)(1)(B) of the Code, and if payment or provision thereof at a later date would avoid any such additional
tax, then the payment or provision thereof shall be postponed to the earliest date on which such amount or benefit can be paid
or provided without incurring such additional tax. In the event this Section 11(o)(i) requires a deferral of any payment, such
payment shall be accumulated and paid in a single lump sum on such earliest date together with interest for the period of delay,
compounded annually, equal to the prime rate (as published in The Wall Street Journal), and in effect as of the date of
the payment should otherwise have been provided

 

(iii)        If
any payment or benefit permitted or required under this Agreement is reasonably determined by either party to be subject for any
reason to a material risk of additional tax pursuant to section 409A(a)(1)(B) of the Code, then the parties shall promptly agree
in good faith on appropriate provisions to avoid such risk without materially changing the economic value of this Agreement to
either party.

 

(p)          Survival.
Sections 6, 7, 8 and 9 (as well as any provisions of this Agreement necessary to give effect thereto) shall survive the termination
of this Agreement.

 

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IN WITNESS WHEREOF, this
Agreement has been executed as of the date and year first above written.

 

	 	THE COMPANY:
	 	 
	 	BRAINSTORM CELL THERAPEUTICS INC.
	 	 	 
	 	By:	/s/ Chaim Lebovits
	 	 	Name: Chaim Lebovits
	 	 	Title: CEO
	 	 	 
	 	THE EXECUTIVE:
	 	 	 
	 	/s/ Anthony Fiorino
	 	Anthony Fiorino, MD, Ph.D

 

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