Document:

Exhibit 4.1

 

 

2021 EQUITY INCENTIVE PLAN

 

 

Forward
Industries, Inc. (the “Company”) hereby establishes this 2021 Equity Incentive Plan (the
“Plan”), effective December 17, 2020, subject to approval by the shareholders of the Company
(“Effective Date”).

 

The Plan is a successor
to the Amended and Restated 2011 Long Term Incentive Plan (the “2011 Plan”). If this Plan is approved by the
Company’s shareholders, no additional grants will be made under the 2011 Plan after the Effective Date. Outstanding grants
under the 2011 Plan shall continue in effect according to their terms, consistent with the 2011 Plan.

 

1.       Purpose;
Eligibility.

 

1.1       General
Purpose. The name of this plan is the Forward Industries, Inc. 2021 Equity Incentive Plan (the “Plan”).
The purpose of the Plan is to (a) enable Forward Industries, Inc. (the “Company”), and any Affiliate to attract
and retain the types of Employees, Consultants and Directors who will contribute to the Company’s long range success; (b)
provide incentives that align the interests of Employees, Consultants and Directors with those of the shareholders of the Company;
and (c) promote the success of the Company’s business.

 

1.2       Eligible
Award Recipients. The persons eligible to receive Awards are the Employees, Consultants and Directors of the Company
and its Affiliates and such other individuals designated by the Committee who are reasonably expected to become Employees, Consultants
and Directors after the receipt of Awards.

 

1.3       Available
Awards. Awards that may be granted under the Plan include: (a) Incentive Stock Options, (b) Non-qualified Stock Options,
(c) Stock Appreciation Rights, (d) Restricted Awards, (e) Performance Share Awards, and (f) Performance Cash Awards.

 

2.       Definitions.

 

“Affiliate”
means a corporation or other entity that, directly or through one or more intermediaries, controls, is controlled by or is under
common control with, the Company. The Board will have the authority to designate the time or times at which an Affiliate’s
status is determined.

 

“Applicable
Laws” means the requirements related to or implicated by the administration of the Plan under applicable state corporate
law, United States federal and state securities laws, the Code, any stock exchange or quotation system on which the shares of Common
Stock are listed or quoted, and the applicable laws of any foreign country or jurisdiction where Awards are granted under the Plan.

 

“Award”
means any right granted under the Plan, including an Incentive Stock Option, a Non-qualified Stock Option, a Stock Appreciation
Right, a Restricted Award, a Performance Share Award, or a Performance Cash Award.

 

“Award Agreement”
means a written agreement, contract, certificate or other instrument or document evidencing the terms and conditions of an individual
Award granted under the Plan which may, in the discretion of the Company, be transmitted electronically to any Participant. Each
Award Agreement shall be subject to the terms and conditions of the Plan.

 

“Beneficial
Owner” has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating
the beneficial ownership of any particular “person” (as that term is used in Section 13(d)(3) of the Exchange Act),
such “person” shall be deemed to have beneficial ownership of all securities that such “person” has the
right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only
after the passage of time. The terms “Beneficially Owns” and “Beneficially Owned” have a corresponding
meaning.

 

 

 

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“Board”
means the Board of Directors of the Company, as constituted at any time.

 

“Cause”
will have the meaning ascribed to such term in the applicable Award Agreement or, if no such definition is provided therein, in
any written agreement between the Participant and the Company defining such term and, in the absence of such agreement, such term
means, with respect to a Participant, the occurrence of any of the following events: (i) such Participant's commission of any felony
or any crime involving fraud, dishonesty or moral turpitude under the laws of the United States, any state thereof, or any applicable
foreign jurisdiction; (ii) such Participant's attempted commission of, or participation in, a fraud or act of dishonesty against
the Company or any Affiliate; (iii) such Participant's intentional, material violation of any contract or agreement between the
Participant and the Company or any Affiliate or of any statutory or common law duty owed to the Company or any Affiliate; (iv)
such Participant's unauthorized use or disclosure of the Company's or any Affiliate's confidential information or trade secrets;
or (v) such Participant's gross misconduct. The determination that a termination of the Participant's Continuous Service is either
for Cause or without Cause will be made by the Board or the Committee, in its sole discretion. Any determination by the Board or
Committee that the Continuous Service of a Participant was terminated with or without Cause for the purposes of outstanding Awards
held by such Participant will have no effect upon any determination of the rights or obligations of the Company or such Participant
for any other purpose.

 

With respect to any
Director, a determination by a majority of the disinterested Board members that the Director has engaged in any of the following:
(a) malfeasance in office; (b) gross misconduct or neglect; (c) false or fraudulent misrepresentation inducing the Director’s
appointment; (d) willful conversion of corporate funds; or (e) repeated failure to participate in Board meetings on a regular basis
despite having received proper notice of the meetings in advance.

 

The Committee, in its
absolute discretion, shall determine the effect of all matters and questions relating to whether a Participant has been discharged
for Cause.

 

“Change
in Control” means the occurrence, in a single transaction or in a series of related transactions, of any one or more
of the following events: (i) any Exchange Act Person becomes the owner, directly or indirectly, of securities of the Company representing
more than 50% of the combined voting power of the Company's then outstanding securities other than by virtue of a merger, consolidation
or similar transaction. Notwithstanding the foregoing, a Change in Control will not be deemed to occur (A) on account of the acquisition
of securities of the Company directly from the Company, (B) on account of the acquisition of securities of the Company by an investor,
any affiliate thereof or any other Exchange Act Person that acquires the Company's securities in a transaction or series of related
transactions the primary purpose of which is to obtain financing for the Company through the issuance of equity securities, (C)
on account of the acquisition of securities of the Company by any individual who is either an executive officer or a Director;
or (D) solely because the level of ownership held by any Exchange Act Person (the "Subject Person") exceeds the
designated percentage threshold of the outstanding voting securities as a result of the conversion of another stockholder's voting
securities or a repurchase or other acquisition of voting securities by the Company reducing the number of shares outstanding,
provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of voting
securities by the Company, and after such share acquisition, the Subject Person becomes the owner of any additional voting securities
that, assuming the repurchase or other acquisition had not occurred, increases the percentage of the then outstanding voting securities
owned by the Subject Person over the designated percentage threshold, then a Change in Control will be deemed to occur; (ii) there
is consummated a merger, consolidation or similar transaction involving (directly or indirectly) the Company and, immediately after
the consummation of such merger, consolidation or similar transaction, the stockholders of the Company immediately prior thereto
do not own, directly or indirectly, either (A) outstanding voting securities representing more than 50% of the combined outstanding
voting power of the surviving entity in such merger, consolidation or similar transaction or (B) more than 50% of the combined
outstanding voting power of the parent of the surviving entity in such merger, consolidation or similar transaction, in each case
in substantially the same proportions as their ownership of the outstanding voting securities of the Company immediately prior
to such transaction. (iii) there is consummated a sale, lease, exclusive license or other disposition of all or substantially all
of the consolidated assets of the Company and its subsidiaries, other than a sale, lease, license or other disposition of all or
substantially all of the consolidated assets of the Company and its subsidiaries to an entity, more than 50% of the combined voting
power of the voting securities of which are owned by stockholders of the Company in substantially the same proportions as their
ownership of the outstanding voting securities of the Company immediately prior to such sale, lease, license or other disposition;
or (iv) individuals who, on the date the Plan is adopted by the Board, are Incumbent Directors (the "Incumbent Board")
cease for any reason to constitute at least a majority of the members of the Board; provided, however, that if the appointment
or election (or nomination for election) of any new Board member was approved or recommended by a majority vote of the members
of the Incumbent Board then still in office, such new member will, for purposes of this Plan, be considered as a member of the
Incumbent Board. Notwithstanding the foregoing definition or any other provision of the Plan, the term Change in Control will not
include a sale of assets, merger or other transaction effected exclusively for the purpose of changing the domicile of the Company
and the definition of Change in Control (or any analogous term) in an individual written agreement between the Company or any Affiliate
and the Participant will supersede the foregoing definition with respect to Awards subject to such agreement; provided, however,
that if no definition of Change in Control or any analogous term is set forth in such an individual written agreement, the foregoing
definition will apply. To the extent required for compliance with Section 409A of the Code, in no event will a Change in Control
be deemed to have occurred if such transaction is not also a "change in the ownership or effective control of" the Company
or "a change in the ownership of a substantial portion of the assets of" the Company as determined under Treasury Regulations
Section 1.409A-3(i)(5) (without regard to any alternative definition thereunder). The Board may, in its sole discretion and without
a Participant's consent, amend the definition of "Change in Control" to conform to the definition of "Change in
Control" under Section 409A of the Code, and the regulations thereunder.

 

 

 

 

 

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“Code”
means the Internal Revenue Code of 1986, as it may be amended from time to time. Any reference to a section of the Code shall be
deemed to include a reference to any regulations promulgated thereunder.

 

“Committee”
means a committee of two or more members of the Board appointed by the Board to administer the Plan in accordance with Section
3.3 and Section 3.4.

 

“Common Stock”
means the common stock, $0.001 par value per share, of the Company, or such other securities of the Company as may be designated
by the Committee from time to time in substitution thereof.

 

“Consultant”
means any person, including an advisor, who is (i) engaged by the Company or an Affiliate to render consulting or advisory services
and is compensated for such services, or (ii) serving as a member of the board of directors of an Affiliate and is compensated
for such services. However, service solely as a Director, or payment of a fee for such service, will not cause a Director to be
considered a "Consultant" for purposes of the Plan. Notwithstanding the foregoing, a person is treated as a Consultant
under this Plan only if a registration statement on Form S-8 under the Securities Act is available to register either the offer
or the sale of the Company's securities to such person.

 

“Continuous
Service” means that the Participant's service with the Company or an Affiliate, whether as an Employee, Director or Consultant,
is not interrupted or terminated. A change in the capacity in which the Participant renders service to the Company or an Affiliate
as an Employee, Consultant or Director or a change in the entity for which the Participant renders such service, provided that
there is no interruption or termination of the Participant's service with the Company or an Affiliate, will not terminate a Participant's
Continuous Service; provided, however, that if the entity for which a Participant is rendering services ceases to qualify
as an Affiliate, as determined by the Board, in its sole discretion, such Participant's Continuous Service will be considered to
have terminated on the date such entity ceases to qualify as an Affiliate. To the extent permitted by law, the Committee or the
chief executive officer of the Company, in that party's sole discretion, may determine whether Continuous Service will be considered
interrupted in the case of (i) any leave of absence approved by the Committee or chief executive officer, including sick leave,
military leave or any other personal leave, or (ii) transfers between the Company, an Affiliate, or their successors. Notwithstanding
the foregoing, a leave of absence will be treated as Continuous Service for purposes of vesting of an
Award only to such extent as may be provided in the Company's leave of absence policy, in the written terms of any leave of absence
agreement or policy applicable to the Participant, or as otherwise required by law. In addition, to the extent required for exemption
from or compliance with Section 409A of the Code, the determination of whether there has been a termination of Continuous Service
will be made, and such term will be construed, in a manner that is consistent with the definition of "separation from service"
as defined under Treasury Regulation Section 1.409A-1(h) (without regard to any alternative definition thereunder).

 

“Deferred
Stock Units (DSUs)” has the meaning set forth in Section 7.2 hereof.

 

“Director”
means a member of the Board.

 

“Disability”
means that the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical
or mental impairment; provided, however, for purposes of determining the term of an Incentive Stock Option pursuant to Section
6.10 hereof, the term Disability shall have the meaning ascribed to it under Section 22(e)(3) of the Code. The determination of
whether an individual has a Disability shall be determined under procedures established by the Committee. Except in situations
where the Committee is determining Disability for purposes of the term of an Incentive Stock Option pursuant to Section 6.10 hereof
within the meaning of Section 22(e)(3) of the Code, the Committee may rely on any determination that a Participant is disabled
for purposes of benefits under any long-term disability plan maintained by the Company or any Affiliate in which a Participant
participates.

 

“Disqualifying
Disposition” has the meaning set forth in Section 14.12.

 

“Effective
Date” shall mean the date as of which this Plan is adopted by the Board.

 

 

 

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“Employee”
means any person, including an Officer or Director, employed by the Company or an Affiliate; provided, that, for purposes of determining
eligibility to receive Incentive Stock Options, an Employee shall mean an employee of the Company or a parent or subsidiary corporation
within the meaning of Section 424 of the Code. Mere service as a Director or payment of a director’s fee by the Company or
an Affiliate shall not be sufficient to constitute “employment” by the Company or an Affiliate.

 

“Exchange
Act” means the Securities Exchange Act of 1934.

 

“Exchange
Act Person” means any natural person, entity or "group" (within the meaning of Section 13(d) or 14(d) of the
Exchange Act), except that "Exchange Act Person" will not include (i) the Company or any subsidiary of the Company, (ii)
any employee benefit plan of the Company or any subsidiary of the Company or any trustee or other fiduciary holding securities
under an employee benefit plan of the Company or any subsidiary of the Company, (iii) an underwriter temporarily holding securities
pursuant to a registered public offering of such securities, (iv) an entity owned, directly or indirectly, by the stockholders
of the Company in substantially the same proportions as their ownership of stock of the Company; or (v) any natural person, entity
or "group" (within the meaning of Section 13(d) or 14(d) of the Exchange Act) that is the owner, directly or indirectly,
of securities of the Company representing more than 50% of the combined voting power of the Company's then outstanding securities.

 

“Fair Market
Value” means, as of the last trading day before the grant of the Award, the value of the Common Stock as determined below.
If the Common Stock is listed on any established stock exchange or a national market system, including without limitation, the
New York Stock Exchange, the NASDAQ Stock Market or the OTC Markets, the Fair Market Value shall be the closing price of a share
of Common Stock as quoted on such exchange or system. In the absence of an established market for the Common Stock, the Fair Market
Value shall be determined in good faith by the Committee and such determination shall be conclusive and binding on all persons.

 

“Free Standing
Rights” has the meaning set forth in Section 7.1(a).

 

“Grant Date”
means the date on which the Committee adopts a resolution, or takes other appropriate action, expressly granting an Award to a
Participant that specifies the key terms and conditions of the Award or, if a later date is set forth in such resolution, then
such date as is set forth in such resolution.

 

“Incentive
Stock Option” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the
Code.

 

“Incumbent
Directors” means individuals who, on the Effective Date, constitute the Board, provided that any individual becoming
a Director subsequent to the Effective Date whose election or nomination for election to the Board was approved by a vote of at
least two-thirds of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement
of the Company in which such person is named as a nominee for Director without objection to such nomination) shall be an Incumbent
Director. No individual initially elected or nominated as a director of the Company as a result of an actual or threatened election
contest with respect to Directors or as a result of any other actual or threatened solicitation of proxies by or on behalf of any
person other than the Board shall be an Incumbent Director.

 

“Non-Employee
Director” means a Director who is a “non-employee director” within the meaning of Rule 16b-3.

 

“Non-qualified
Stock Option” means an Option that by its terms does not qualify or is not intended to qualify as an Incentive Stock
Option.

 

“Officer”
means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

 

“Option”
means an Incentive Stock Option or a Non-qualified Stock Option granted pursuant to the Plan.

 

“Optionholder”
means a person to whom an Option is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding
Option.

 

 

 

 

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“Option Exercise
Price” means the price at which a share of Common Stock may be purchased upon the exercise of an Option.

 

“Participant”
means an eligible person to whom an Award is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding
Award.

 

“Performance
Cash Award” means an award of cash granted pursuant to the terms and conditions of Section 7.4.

 

“Performance
Criteria” means the one or more criteria that the Board or Committee (as applicable) will select for purposes of establishing
the Performance Goals for a Performance Period. The Performance Criteria that will be used to establish such Performance Goals
may be based on any one of, or combination of, the following as determined by the Board or Committee (as applicable): (i) earnings
(including earnings per share and net earnings); (ii) earnings before interest, taxes and depreciation; (iii) earnings before interest,
taxes, depreciation and amortization; (iv) earnings before interest, taxes, depreciation, amortization and legal settlements; (v)
earnings before interest, taxes, depreciation, amortization, legal settlements and other income (expense); (vi) earnings before
interest, taxes, depreciation, amortization, legal settlements, other income (expense) and stock-based compensation; (vii) earnings
before interest, taxes, depreciation, amortization, legal settlements, other income (expense), stock-based compensation and changes
in deferred revenue; (viii) total stockholder return; (ix) return on equity or average stockholder's equity; (x) return on assets,
investment, or capital employed; (xi) stock price; (xii) margin (including gross margin); (xiii) income (before or after taxes);
(xiv) operating income; (xv) operating income after taxes; (xvi) pre-tax profit; (xvii) operating cash flow; (xviii) sales or revenue
targets; (xix) increases in revenue or product revenue; (xx) expenses and cost reduction goals; (xxi) improvement in or attainment
of working capital levels; (xxii) economic value added (or an equivalent metric); (xxiii) market share; (xxiv) cash flow; (xxv)
cash flow per share; (xxvi) share price performance; (xxvii) debt reduction; (xxviii) implementation or completion of projects
or processes; (xxix) stockholders' equity; (xxx) capital expenditures; (xxxi) debt levels; (xxxii) operating profit or net
operating profit; (xxxiii) workforce diversity; (xxxiv) growth of net income or operating income; (xxxv) employee retention; (xxxvi)
client satisfaction; (xxxvii ) budget management; (xxxviii) entry into or completion of strategic partnerships or transactions
(including in-licensing and out-licensing of intellectual property);and (xliiv) completion of acquisitions or business expansion.

 

“Performance
Goals” means, for a Performance Period, the one or more goals established by the Board or Committee (as applicable) for
the Performance Period based upon the Performance Criteria. Performance Goals may be based on a Company-wide basis, with respect
to one or more business units, divisions, Affiliates, or business segments, and in either absolute terms or relative to the performance
of one or more comparable companies or the performance of one or more relevant indices. Unless specified otherwise (i) by
the Board or Committee (as applicable) (ii) in the Award Agreement at the time the Award is granted or (iii) in such other documented
agreement between the Company and the Participant setting forth the Performance Goals at the time the Performance Goals are established,
the Board or Committee (as applicable) may appropriately make adjustments in the method of calculating the attainment of Performance
Goals for a Performance Period, including without limitation as follows: (1) to exclude restructuring
and/or other nonrecurring charges; (2) to exclude exchange rate effects; (3) to exclude the effects of changes in the Company’s
fiscal year, and changes to tax laws, generally accepted accounting principles, or other laws and regulations affecting reported
results; (4) to exclude the effects of items that are "unusual" in nature or occur "infrequently" as determined
under generally accepted accounting principles; (6) to exclude the dilutive effects of acquisitions or joint ventures; (7) to assume
that any business divested by the Company achieved performance objectives at targeted levels during the balance of a Performance
Period following such divestiture; (8) to exclude the effect of any change in the outstanding shares of common stock of the Company
by reason of any stock dividend or split, stock repurchase, reorganization, recapitalization, merger, consolidation, spin-off,
combination or exchange of shares or other similar corporate change, or any distributions to common stockholders other than regular
cash dividends; (9) to exclude the effects of stock-based compensation and the award of bonuses under the Company's bonus plans,
if any; (10) to exclude costs incurred in connection with potential acquisitions or divestitures that are required to be expensed
under generally accepted accounting principles; (11) to exclude the goodwill and intangible asset impairment charges that are required
to be recorded under generally accepted accounting principles; or (12) to exclude litigation or claim judgments or settlements.
In addition, the Board or Committee (as applicable) retains the discretion to reduce or eliminate the compensation or economic
benefit due upon attainment of Performance Goals and to define the manner of calculating the Performance Criteria it selects to
use for such Performance Period. Partial achievement of the specified criteria may result in the payment or vesting corresponding
to the degree of achievement as specified in the Performance Share Award Agreement or the written terms of a Performance Cash Award.

 

 

 

 

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“Performance
Period” means the period of time selected by the Board or Committee (as applicable) over which the attainment of one
or more Performance Goals will be measured for the purpose of determining a Participant's right to and the payment of a Performance
Share Award or a Performance Cash Award. Performance Periods may be of varying and overlapping duration, at the sole discretion
of the Board or Committee (as applicable).

 

“Performance
Share Award” means any Award granted pursuant to Section 7.3 hereof.

 

“Performance
Share” means the grant of a right to receive a number of actual shares of Common Stock or share units based upon the
performance of the Company during a Performance Period, as determined by the Committee.

 

“Permitted
Transferee” means: (a) a member of the Optionholder’s immediate family (child, stepchild, grandchild, parent, stepparent,
grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law,
or sister-in-law, including adoptive relationships), any person sharing the Optionholder’s household (other than a tenant
or employee), a trust in which these persons have more than 50% of the beneficial interest, a foundation in which these persons
(or the Optionholder) control the management of assets, and any other entity in which these persons (or the Optionholder) own more
than 50% of the voting interests; (b) third parties designated by the Committee in connection with a program established and approved
by the Committee pursuant to which Participants may receive a cash payment or other consideration in consideration for the transfer
of a Non-qualified Stock Option; and (c) such other transferees as may be permitted by the Committee in its sole discretion.

 

“Plan”
means this 2021 Equity Incentive Plan, as amended and/or amended and restated from time to time.

 

“Related Rights”
has the meaning set forth in Section 7.1(a).

 

“Restricted
Award” means any Award granted pursuant to Section 7.2(a).

 

“Restricted
Period” has the meaning set forth in Section 7.2(a).

 

“Rule 16b-3”
means Rule 16b-3 promulgated under the Exchange Act or any successor to Rule 16b-3, as in effect from time to time.

 

“Securities
Act” means the Securities Act of 1933.

 

“Stock Appreciation
Right” means the right pursuant to an Award granted under Section 7.1 to receive, upon exercise, an amount payable in
cash or shares equal to the number of shares subject to the Stock Appreciation Right that is being exercised multiplied by the
excess of (a) the Fair Market Value of a share of Common Stock, over (b) the exercise price specified in the Stock Appreciation
Right Award Agreement.

 

“Stock for
Stock Exchange” has the meaning set forth in Section 6.4.

 

“Ten Percent
Shareholder” means a person who owns (or is deemed to own pursuant to Section 424(d) of the Code) stock possessing more
than 10% of the total combined voting power of all classes of stock of the Company or of any of its Affiliates.

 

3.       Administration.

 

3.1       Authority
of Committee. The Plan shall be administered by the Committee or, in the Board’s sole discretion, by the Board.
Subject to the terms of the Plan, the Committee’s charter and Applicable Laws, and in addition to other express powers and
authorization conferred by the Plan, the Committee shall have the authority:

 

(a)       to
construe and interpret the Plan and apply its provisions;

 

(b)       to
promulgate, amend, and rescind rules and regulations relating to the administration of the Plan;

 

(c)       to
authorize any person to execute, on behalf of the Company, any instrument required to carry out the purposes of the Plan;

 

 

 

 

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(d)       to
delegate its authority to one or more Officers of the Company with respect to Awards that do not involve “insiders”
within the meaning of Section 16 of the Exchange Act;

 

(e)       to
determine when Awards are to be granted under the Plan and the applicable Grant Date;

 

(f)       from
time to time to select, subject to the limitations set forth in this Plan, those Participants to whom Awards shall be granted;

 

(g)       to
determine the number of shares of Common Stock to be made subject to each Award;

 

(h)       to
determine whether each Option is to be an Incentive Stock Option or a Non-qualified Stock Option;

 

(i)       to
prescribe the terms and conditions of each Award, including, without limitation, the exercise price and medium of payment and vesting
provisions, and to specify the provisions of the Award Agreement relating to such grant;

 

(j)       to
determine the target number of Performance Shares to be granted pursuant to a Performance Share Award, the performance measures
that will be used to establish the performance goals, the performance period(s) and the number of Performance Shares earned by
a Participant;

 

(l)       to
amend any outstanding Awards, including for the purpose of modifying the time or manner of vesting, or the term of any outstanding
Award; provided, however, that if any such amendment impairs a Participant’s rights or increases a Participant’s obligations
under his or her Award or creates or increases a Participant’s federal income tax liability with respect to an Award, such
amendment shall also be subject to the Participant’s consent;

 

(m)       to
determine the duration and purpose of leaves of absences which may be granted to a Participant without constituting termination
of their employment for purposes of the Plan, which periods shall be no shorter than the periods generally applicable to Employees
under the Company’s employment policies;

 

(n)       to
make decisions with respect to outstanding Awards that may become necessary upon a change in corporate control or an event that
triggers anti-dilution adjustments;

 

(o)       to
interpret, administer, reconcile any inconsistency in, correct any defect in and/or supply any omission in the Plan and any instrument
or agreement relating to, or Award granted under, the Plan; and

 

(p)       to
exercise discretion to make any and all other determinations which it determines to be necessary or advisable for the administration
of the Plan.

 

The Committee also
may modify the purchase price or the exercise price of any outstanding Award, provided that if the modification effects a repricing,
shareholder approval shall be required before the repricing is effective.

 

3.2       Committee
Decisions Final. All decisions made by the Committee pursuant to the provisions of the Plan shall be final and binding
on the Company and the Participants, unless such decisions are determined by a court having jurisdiction to be arbitrary and capricious.

 

3.3       Delegation.
The Committee or, if no Committee has been appointed, the Board may delegate administration of the Plan to a committee or committees
of two or more members of the Board, and the term “Committee” shall apply to any persons to whom such authority
has been delegated. The Committee shall have the power to delegate to a subcommittee any of the administrative powers the Committee
is authorized to exercise (and references in this Plan to the Board or the Committee shall thereafter be to the committee or subcommittee),
subject, however, to such resolutions, not inconsistent with the provisions of the Plan, as may be adopted from time to time by
the Board. The Board may abolish the Committee at any time and revest in the Board the administration of the Plan. The members
of the Committee shall be appointed by and serve at the pleasure of the Board. From time to time, the Board may increase or decrease
the size of the Committee, add additional members to, remove members (with or without cause) from, appoint new members in substitution
therefor, and fill vacancies, however caused, in the Committee. The Committee shall act pursuant to a vote of the majority of its
members or, in the case of a Committee comprised of only two members, the unanimous consent of its members, whether present or
not, or by the written consent of the majority of its members and minutes shall be kept of all of its meetings and copies thereof
shall be provided to the Board. Subject to the limitations prescribed by the Plan and the Board, the Committee may establish and
follow such rules and regulations for the conduct of its business as it may determine to be advisable.

 

 

 

 

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3.4       Committee
Composition. The Committee shall consist solely of two or more Non-Employee Directors, unless determined otherwise by
the Board. The Board shall have discretion to determine whether or not it intends to comply with the exemption requirements of
Rule 16b-3. However, if the Board intends to satisfy such exemption requirements with respect to any insider subject to Section
16 of the Exchange Act, the Committee shall be a compensation committee of the Board that at all times consists solely of two or
more Non-Employee Directors. Within the scope of such authority, the Board or the Committee may delegate to a committee of one
or more members of the Board who are not Non-Employee Directors the authority to grant Awards to eligible persons who are not then
subject to Section 16 of the Exchange Act. Nothing herein shall create an inference that an Award is not validly granted under
the Plan in the event Awards are granted under the Plan by a compensation committee of the Board that does not at all times consist
solely of two or more Non-Employee Directors.

 

3.5       Indemnification.
In addition to such other rights of indemnification as they may have as Directors or members of the Committee, and to the extent
allowed by Applicable Laws, the Committee shall be indemnified by the Company against the reasonable expenses, including attorney’s
fees, actually incurred in connection with any action, suit or proceeding or in connection with any appeal therein, to which the
Committee may be party by reason of any action taken or failure to act under or in connection with the Plan or any Award granted
under the Plan, and against all amounts paid by the Committee in settlement thereof (provided, however, that the settlement has
been approved by the Company, which approval shall not be unreasonably withheld) or paid by the Committee in satisfaction of a
judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action,
suit or proceeding that such Committee did not act in good faith and in a manner which such person reasonably believed to be in
the best interests of the Company, or in the case of a criminal proceeding, had no reason to believe that the conduct complained
of was unlawful; provided, however, that within 60 days after institution of any such action, suit or proceeding, such Committee
shall, in writing, offer the Company the opportunity at its own expense to handle and defend such action, suit or proceeding.

 

4.       Shares
Subject to the Plan.

 

4.1       Subject
to adjustment in accordance with Section 11 and 4.2 below, Shares authorized for Awards granted under the Plan on and after the
Effective Date shall not exceed 1,291,000 shares, which is calculated as follows: (i) 1,000,000
new shares, plus (ii) 291,000 shares, which is the number of shares that remained available for
grants under the 2011 Plan as of December 14, 2020. The number of shares set forth in clause (ii)
above will be reduced by the number of shares subject to awards granted under the 2011 Plan after December
14, 2020 and before the Effective Date. No more than 1,291,000 shares of Common Stock may
be granted as Incentive Stock Options. During the terms of the Awards, the Company shall keep available at all times the number
of shares of Common Stock required to satisfy such Awards. Shares of Common Stock available for distribution under the Plan may
consist, in whole or in part, of authorized and unissued shares, treasury shares or shares reacquired by the Company in any manner.

 

4.2       If
any shares subject to an Award granted under the Plan are forfeited, an Award granted under the Plan expires or otherwise terminates
without issuance of shares, or an Award granted under the Plan is settled for cash (in whole or in part) or otherwise does not
result in the issuance of all or a portion of the shares subject to such Award (except as described below with respect to stock
settled Stock Appreciation Rights), such shares shall, to the extent of such forfeiture, expiration, termination, cash settlement
or non-issuance, again be available for grant under the Plan in accordance with Section 4.3 below. Notwithstanding anything to
the contrary contained herein: shares subject to an Award under the Plan shall not again be made available for issuance or delivery
under the Plan if such shares are (a) shares tendered in payment of an Option, (b) shares delivered or withheld by the Company
to satisfy any tax withholding obligation, or (c) shares covered by a stock-settled Stock Appreciation Right or other Awards that
were not issued upon the settlement of the Award.

 

4.3       Any
shares that again become available for Awards under the Plan pursuant to this Section shall be added as one share for every one
share subject to the Awards.

 

 

 

 

    	 	8	 

     

    

 

5.       Eligibility.

 

5.1       Eligibility
for Specific Awards. Incentive Stock Options may be granted only to Employees. Awards other than Incentive Stock Options
may be granted to Employees, Consultants and Directors and those individuals whom the Committee determines are reasonably expected
to become Employees, Consultants and Directors following the Grant Date.

 

5.2       Ten
Percent Shareholders. A Ten Percent Shareholder shall not be granted an Incentive Stock Option unless the Option Exercise
Price is at least 110% of the Fair Market Value of the Common Stock at the Grant Date and the Option is not exercisable after the
expiration of five years from the Grant Date.

 

6.       Option
Provisions. Each Option granted under the Plan shall be evidenced by an Award Agreement. Each Option so granted shall
be subject to the conditions set forth in this Section 6, and to such other conditions not inconsistent with the Plan as may be
reflected in the applicable Award Agreement. All Options shall be separately designated Incentive Stock Options or Non-Qualified
Stock Options at the time of grant, and, if certificates are issued, a separate certificate or certificates will be issued for
shares of Common Stock purchased on exercise of each type of Option. Notwithstanding the foregoing, the Company shall have no liability
to any Participant or any other person if an Option designated as an Incentive Stock Option fails to qualify as such at any time
or if an Option is determined to constitute “nonqualified deferred compensation” within the meaning of Section 409A
of the Code and the terms of such Option do not satisfy the requirements of Section 409A of the Code. The provisions of separate
Options need not be identical, but each Option shall include (through incorporation of provisions hereof by reference in the Option
or otherwise) the substance of each of the following provisions:

 

6.1       Term.
Subject to the provisions of Section 5.2 regarding Ten Percent Shareholders, no Incentive Stock Option shall be exercisable after
the expiration of 10 years from the Grant Date. The term of a Non-qualified Stock Option granted under the Plan shall be determined
by the Committee; provided, however, no Non-qualified Stock Option shall be exercisable after the expiration of 10 years from the
Grant Date.

 

6.2       Exercise
Price of an Incentive Stock Option. Subject to the provisions of Section 5.2 regarding Ten Percent Shareholders, the
Option Exercise Price of each Incentive Stock Option shall be not less than 100% of the Fair Market Value of the Common Stock subject
to the Option on the Grant Date. Notwithstanding the foregoing, an Incentive Stock Option may be granted with an Option Exercise
Price lower than that set forth in the preceding sentence if such Option is granted pursuant to an assumption or substitution for
another option in a manner satisfying the provisions of Section 424A of the Code.

 

6.3       Exercise
Price of a Non-qualified Stock Option. The Option Exercise Price of each Non-qualified Stock Option shall be not less
than 100% of the Fair Market Value of the Common Stock subject to the Option on the Grant Date. Notwithstanding the foregoing,
a Non-qualified Stock Option may be granted with an Option Exercise Price lower than that set forth in the preceding sentence if
such Option is granted pursuant to an assumption or substitution for another option in a manner satisfying the provisions of Section
409A of the Code.

 

6.4       Consideration.
The Option Exercise Price of Common Stock acquired pursuant to an Option shall be paid, to the extent permitted by applicable statutes
and regulations, either (a) in cash or by certified or bank check at the time the Option is exercised or (b) in the discretion
of the Committee, upon such terms as the Committee shall approve, the Option Exercise Price may be paid by: (i) delivery to the
Company of other Common Stock, duly endorsed for transfer to the Company, with a Fair Market Value on the date of delivery equal
to the Option Exercise Price (or portion thereof) due for the number of shares being acquired, or by means of attestation whereby
the Participant identifies for delivery specific shares of Common Stock that have an aggregate Fair Market Value on the date of
attestation equal to the Option Exercise Price (or portion thereof) and receives a number of shares of Common Stock equal to the
difference between the number of shares thereby purchased and the number of identified attestation shares of Common Stock (a “Stock
for Stock Exchange”); (ii) a “cashless” exercise program established with a broker; (iii) by reduction in
the number of shares of Common Stock otherwise deliverable upon exercise of such Option with a Fair Market Value equal to the aggregate
Option Exercise Price at the time of exercise; (iv) any combination of the foregoing methods; or (v) in any other form of legal
consideration that may be acceptable to the Committee. Unless otherwise specifically provided in the Option, the exercise price
of Common Stock acquired pursuant to an Option that is paid by delivery (or attestation) to the Company of other Common Stock acquired,
directly or indirectly from the Company, shall be paid only by shares of the Common Stock of the Company that have been held for
more than six months (or such longer or shorter period of time required to avoid a charge to earnings for financial accounting
purposes). Notwithstanding the foregoing, during any period for which the Common Stock is publicly traded (i.e., the Common Stock
is listed on any established stock exchange or a national market system) an exercise by a Director or Officer that involves or
may involve a direct or indirect extension of credit or arrangement of an extension of credit by the Company, directly or indirectly,
in violation of Section 402(a) of the Sarbanes-Oxley Act of 2002 shall be prohibited with respect to any Award under this Plan.

 

 

 

 

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6.5       Transferability
of an Incentive Stock Option. An Incentive Stock Option shall not be transferable except by will or by the laws of descent
and distribution and shall be exercisable during the lifetime of the Optionholder only by the Optionholder. Notwithstanding the
foregoing, the Optionholder may, by delivering written notice to the Company, in a form satisfactory to the Company, designate
a third party who, in the event of the death of the Optionholder, shall thereafter be entitled to exercise the Option.

 

6.6       Transferability
of a Non-qualified Stock Option. A Non-qualified Stock Option may, in the sole discretion of the Committee, be transferable
to a Permitted Transferee, upon written approval by the Committee to the extent provided in the Award Agreement. If the Non-qualified
Stock Option does not provide for transferability, then the Non-qualified Stock Option shall not be transferable except by will
or by the laws of descent and distribution and shall be exercisable during the lifetime of the Optionholder only by the Optionholder.
Notwithstanding the foregoing, the Optionholder may, by delivering written notice to the Company, in a form satisfactory to the
Company, designate a third party who, in the event of the death of the Optionholder, shall thereafter be entitled to exercise the
Option.

 

6.7       Vesting
of Options. Each Option may, but need not, vest and therefore become exercisable in periodic installments that may,
but need not, be equal. The Option may be subject to such other terms and conditions on the time or times when it may be exercised
(which may be based on performance or other criteria) as the Committee may deem appropriate. The vesting provisions of individual
Options may vary. No Option may be exercised for a fraction of a share of Common Stock. The Committee may, but shall not be required
to, provide for an acceleration of vesting and exercisability in the terms of any Award Agreement upon the occurrence of a specified
event.

 

6.8       Termination
of Continuous Service. Unless otherwise provided in an Award Agreement or in an employment agreement the terms of which
have been approved by the Committee, in the event an Optionholder’s Continuous Service terminates (other than upon the Optionholder’s
death or Disability), the Optionholder may exercise his or her Option (to the extent that the Optionholder was entitled to exercise
such Option as of the date of termination) but only within such period of time ending on the earlier of (a) the date three months
(except for Non-qualified Stock Options which shall be six months) following the termination of the Optionholder’s Continuous
Service or (b) the expiration of the term of the Option as set forth in the Award Agreement; provided that, if the termination
of Continuous Service is by the Company for Cause, all outstanding Options (whether or not vested) shall immediately terminate
and cease to be exercisable. If, after termination, the Optionholder does not exercise his or her Option within the time specified
in the Award Agreement, the Option shall terminate.

 

6.9       Extension
of Termination Date. An Optionholder’s Award Agreement may also provide that if the exercise of the Option following
the termination of the Optionholder’s Continuous Service for any reason would be prohibited at any time because the issuance
of shares of Common Stock would violate the registration requirements under the Securities Act or any other state or federal securities
law or the rules of any securities exchange or interdealer quotation system, then the Option shall terminate on the earlier of
(a) the expiration of the term of the Option in accordance with Section 6.1 or (b) the expiration of a period after termination
of the Participant’s Continuous Service that is three months after the end of the period during which the exercise of the
Option would be in violation of such registration or other securities law requirements.

 

6.10       Disability
of Optionholder. Unless otherwise provided in an Award Agreement, in the event that an Optionholder’s Continuous
Service terminates as a result of the Optionholder’s Disability, the Optionholder may exercise his or her Option (to the
extent that the Optionholder was entitled to exercise such Option as of the date of termination), but only within such period of
time ending on the one year anniversary of the termination as a result of the Optionholder’s Disability. If, after termination,
the Optionholder does not exercise his or her Option within the time specified herein or in the Award Agreement, the Option shall
terminate.

 

6.11       Death
of Optionholder. Unless otherwise provided in an Award Agreement, in the event an Optionholder’s Continuous Service
terminates as a result of the Optionholder’s death, then the Option may be exercised (to the extent the Optionholder was
entitled to exercise such Option as of the date of death) by the Optionholder’s estate, by a person who acquired the right
to exercise the Option by bequest or inheritance or by a person designated to exercise the Option upon the Optionholder’s
death, but only within the period ending on the one year anniversary of the Optionholder’s death. If, after the Optionholder’s
death, the Option is not exercised within the time specified herein or in the Award Agreement, the Option shall terminate.

 

6.12       Incentive
Stock Option $100,000 Limitation. To the extent that the aggregate Fair Market Value (determined at the time of grant)
of Common Stock with respect to which Incentive Stock Options are exercisable for the first time by any Optionholder during any
calendar year (under all plans of the Company and its Affiliates) exceeds $100,000, the Options or portions thereof which exceed
such limit (according to the order in which they were granted) shall be treated as Non-qualified Stock Options.

 

 

 

 

    	 	10	 

     

    

 

7.       Provisions
of Awards Other Than Options.

 

7.1       Stock
Appreciation Rights.

 

(a)       General.
Each Stock Appreciation Right granted under the Plan shall be evidenced by an Award Agreement. Each Stock Appreciation Right so
granted shall be subject to the conditions set forth in this Section 7.1, and to such other conditions not inconsistent with the
Plan as may be reflected in the applicable Award Agreement. Stock Appreciation Rights may be granted alone (“Free Standing
Rights”) or in tandem with an Option (“Related Rights”) granted under the Plan.

 

(b)       Grant
Requirements. Any Related Right that relates to a Non-qualified Stock Option may be granted at the same time the Option is
granted or at any time thereafter but before the exercise or expiration of the Option. Any Related Right that relates to an Incentive
Stock Option must be granted at the same time the Incentive Stock Option is granted.

 

(c)       Term
of Stock Appreciation Rights. The term of a Stock Appreciation Right granted under the Plan shall be determined by the Committee;
provided, however, no Stock Appreciation Right shall be exercisable later than the tenth anniversary of the Grant Date.

 

(d)       Vesting
of Stock Appreciation Rights. Each Stock Appreciation Right may, but need not, vest and therefore become exercisable in periodic
installments that may, but need not, be equal. The Stock Appreciation Right may be subject to such other terms and conditions on
the time or times when it may be exercised as the Committee may deem appropriate. The vesting provisions of individual Stock Appreciation
Rights may vary. No Stock Appreciation Right may be exercised for a fraction of a share of Common Stock. The Committee may, but
shall not be required to, provide for an acceleration of vesting and exercisability in the terms of any Stock Appreciation Right
upon the occurrence of a specified event.

 

(e)       Exercise
and Payment. Upon exercise of a Stock Appreciation Right, the holder shall be entitled to receive from the Company an amount
equal to the number of shares of Common Stock subject to the Stock Appreciation Right that is being exercised multiplied by the
excess of (i) the Fair Market Value of a share of Common Stock, over (ii) the exercise price specified in the Stock Appreciation
Right or related Option. Payment with respect to the exercise of a Stock Appreciation Right shall be made on the date of exercise.
Payment shall be made in the form of shares of Common Stock (with or without restrictions as to substantial risk of forfeiture
and transferability, as determined by the Committee in its sole discretion), cash or a combination thereof, as determined by the
Committee.

 

(f)       Exercise
Price. The exercise price of a Free Standing Right shall be determined by the Committee, but shall not be less than 100% of
the Fair Market Value of one share of Common Stock on the Grant Date of such Stock Appreciation Right. A Related Right granted
simultaneously with or subsequent to the grant of an Option and in conjunction therewith or in the alternative thereto shall have
the same exercise price as the related Option and shall be exercisable only to the same extent as the related Option; provided,
however, that a Stock Appreciation Right, by its terms, shall be exercisable only when the Fair Market Value per share of Common
Stock subject to the Stock Appreciation Right and related Option exceeds the exercise price per share thereof and no Stock Appreciation
Rights may be granted in tandem with an Option unless the Committee determines that the requirements of Section 7.1(b) are satisfied.

 

(g)       Reduction
in the Underlying Option Shares. Upon any exercise of a Related Right, the number of shares of Common Stock for which any related
Option shall be exercisable shall be reduced by the number of shares for which the Stock Appreciation Right has been exercised.
The number of shares of Common Stock for which a Related Right shall be exercisable shall be reduced upon any exercise of any related
Option by the number of shares of Common Stock for which such Option has been exercised.

 

(h)       Transferability
of Stock Appreciation Rights. A Free Standing Right may, in the sole discretion of the Committee, be transferable to a Permitted
Transferee, upon written approval by the Committee to the extent provided in the Award Agreement. If the Free Standing Right does
not provide for transferability, then the Free Standing Right shall not be transferable except by will or by the laws of descent
and distribution and shall be exercisable during the lifetime of the Participant only by the Participant. Notwithstanding the foregoing,
the Participant may, by delivering written notice to the Company, in a form satisfactory to the Company, designate a third party
who, in the event of the death of the Participant, shall thereafter be entitled to exercise the Free Standing Right. A Related
Right granted simultaneously with or subsequent to the grant of an Option and in conjunction therewith or in the alternative thereto
shall be transferable only upon the same terms and conditions as the related Option.

 

 

 

 

    	 	11	 

     

    

 

7.2       Restricted
Awards.

 

(a)       General.
A Restricted Award is an Award of actual shares of Common Stock (“Restricted Stock”) or hypothetical Common
Stock units (“Restricted Stock Units”) having a value equal to the Fair Market Value of an identical number
of shares of Common Stock, which may, but need not, provide that such Restricted Award may not be sold, assigned, transferred or
otherwise disposed of, pledged or hypothecated as collateral for a loan or as security for the performance of any obligation or
for any other purpose for such period (the “Restricted Period”) as the Committee shall determine. Each Restricted
Award granted under the Plan shall be evidenced by an Award Agreement. Each Restricted Award so granted shall be subject to the
conditions set forth in this Section 7.2, and to such other conditions not inconsistent with the Plan as may be reflected in the
applicable Award Agreement.

 

(b)       Restricted
Stock and Restricted Stock Units. Each Participant granted Restricted Stock shall execute and deliver to the Company an Award
Agreement with respect to the Restricted Stock setting forth the restrictions and other terms and conditions applicable to such
Restricted Stock. If the Committee determines that the Restricted Stock shall be held by the Company or in escrow rather than delivered
to the Participant pending the release of the applicable restrictions, the Committee may require the Participant to additionally
execute and deliver to the Company (A) an escrow agreement satisfactory to the Committee, if applicable and (B) the appropriate
blank stock power with respect to the Restricted Stock covered by such agreement. If a Participant fails to execute an agreement
evidencing an Award of Restricted Stock and, if applicable, an escrow agreement and stock power, the Award shall be null and void.
Subject to the restrictions set forth in the Award, the Participant generally shall have the rights and privileges of a shareholder
as to such Restricted Stock, including the right to vote such Restricted Stock and the right to receive dividends; provided that,
any cash dividends and stock dividends with respect to the Restricted Stock shall be withheld by the Company for the Participant’s
account, and interest may be credited on the amount of the cash dividends withheld at a rate and subject to such terms as determined
by the Committee. The cash dividends or stock dividends so withheld by the Committee and attributable to any particular share of
Restricted Stock (and earnings thereon, if applicable) shall be distributed to the Participant in cash or, at the discretion of
the Committee, in shares of Common Stock having a Fair Market Value equal to the amount of such dividends, if applicable, upon
the release of restrictions on such share and, if such share is forfeited, the Participant shall have no right to such dividends.

 

(i)       The
terms and conditions of a grant of Restricted Stock Units shall be reflected in an Award Agreement. No shares of Common Stock shall
be issued at the time a Restricted Stock Unit is granted, and the Company will not be required to set aside a fund for the payment
of any such Award. A Participant shall have no voting rights with respect to any Restricted Stock Units granted hereunder. The
Committee may also grant Restricted Stock Units with a deferral feature, whereby settlement is deferred beyond the vesting date
until the occurrence of a future payment date or event set forth in an Award Agreement (“Deferred Stock Units”).
At the discretion of the Committee, each Restricted Stock Unit or Deferred Stock Unit (representing one share of Common Stock)
may be credited with cash and stock dividends paid by the Company in respect of one share of Common Stock (“Dividend Equivalents”).
Dividend Equivalents shall be paid currently (and in no case later than the end of the calendar year in which the dividend is paid
to the holders of the Common Stock or, if later, the 15th day of the third month following the date the dividend is paid to holders
of the Common Stock). Dividend Equivalents shall be withheld by the Company and credited to the Participant’s account, and
interest may be credited on the amount of cash Dividend Equivalents credited to the Participant’s account at a rate and subject
to such terms as determined by the Committee. Dividend Equivalents credited to a Participant’s account and attributable to
any particular Restricted Stock Unit or Deferred Stock Unit (and earnings thereon, if applicable) shall be distributed in cash
or, at the discretion of the Committee, in shares of Common Stock having a Fair Market Value equal to the amount of such Dividend
Equivalents and earnings, if applicable, to the Participant upon settlement of such Restricted Stock Unit or Deferred Stock Unit
and, if such Restricted Stock Unit or Deferred Stock Unit is forfeited, the Participant shall have no right to such Dividend Equivalents.
Dividend Equivalents will be deemed re-invested in additional Restricted Stock Units or Deferred Stock Units based on the Fair
Market Value of a share of Common Stock on the applicable dividend payment date and rounded down to the nearest whole share.

 

(c)       Restrictions.

 

(i)       Restricted
Stock awarded to a Participant shall be subject to the following restrictions until the expiration of the Restricted Period, and
to such other terms and conditions as may be set forth in the applicable Award Agreement: (A) if an escrow arrangement is used,
the Participant shall not be entitled to delivery of the stock certificate; (B) the shares shall be subject to the restrictions
on transferability set forth in the Award Agreement; (C) the shares shall be subject to forfeiture to the extent provided in the
applicable Award Agreement; and (D) to the extent such shares are forfeited, the stock certificates shall be returned to the Company,
and all rights of the Participant to such shares and as a shareholder with respect to such shares shall terminate without further
obligation on the part of the Company.

 

 

 

 

    	 	12	 

     

    

 

(ii)       Restricted
Stock Units and Deferred Stock Units awarded to any Participant shall be subject to (A) forfeiture until the expiration of the
Restricted Period, and satisfaction of any applicable Performance Goals during such period, to the extent provided in the applicable
Award Agreement, and to the extent such Restricted Stock Units or Deferred Stock Units are forfeited, all rights of the Participant
to such Restricted Stock Units or Deferred Stock Units shall terminate without further obligation on the part of the Company and
(B) such other terms and conditions as may be set forth in the applicable Award Agreement.

 

(iii)       The
Committee shall have the authority to remove any or all of the restrictions on the Restricted Stock, Restricted Stock Units and
Deferred Stock Units whenever it may determine that, by reason of changes in Applicable Laws or other changes in circumstances
arising after the date the Restricted Stock or Restricted Stock Units or Deferred Stock Units are granted, such action is appropriate.

 

(d)       Restricted
Period. With respect to Restricted Awards, the Restricted Period shall commence on the Grant Date and end at the time or times
set forth on a schedule established by the Committee in the applicable Award Agreement.

 

No Restricted Award
may be granted or settled for a fraction of a share of Common Stock. The Committee may, but shall not be required to, provide for
an acceleration of vesting in the terms of any Award Agreement upon the occurrence of a specified event.

 

(e)       Delivery
of Restricted Stock and Settlement of Restricted Stock Units. Upon the expiration of the Restricted Period with respect to
any shares of Restricted Stock, the restrictions set forth in Section 7.2(c) and the applicable Award Agreement shall be of no
further force or effect with respect to such shares, except as set forth in the applicable Award Agreement. If an escrow arrangement
is used, upon such expiration, the Company shall deliver to the Participant, or his or her beneficiary, without charge, the stock
certificate evidencing the shares of Restricted Stock which have not then been forfeited and with respect to which the Restricted
Period has expired (to the nearest full share) and any cash dividends or stock dividends credited to the Participant’s account
with respect to such Restricted Stock and the interest thereon, if any. Upon the expiration of the Restricted Period with respect
to any outstanding Restricted Stock Units, or at the expiration of the deferral period with respect to any outstanding Deferred
Stock Units, the Company shall deliver to the Participant, or his or her beneficiary, without charge, one share of Common Stock
for each such outstanding vested Restricted Stock Unit or Deferred Stock Unit (“Vested Unit”) and cash equal
to any Dividend Equivalents credited with respect to each such Vested Unit in accordance with Section 7.2(b)(i) hereof and the
interest thereon or, at the discretion of the Committee, in shares of Common Stock having a Fair Market Value equal to such Dividend
Equivalents and the interest thereon, if any; provided, however, that, if explicitly provided in the applicable Award Agreement,
the Committee may, in its sole discretion, elect to pay cash or part cash and part Common Stock in lieu of delivering only shares
of Common Stock for Vested Units. If a cash payment is made in lieu of delivering shares of Common Stock, the amount of such payment
shall be equal to the Fair Market Value of the Common Stock as of the date on which the Restricted Period lapsed in the case of
Restricted Stock Units, or the delivery date in the case of Deferred Stock Units, with respect to each Vested Unit.

 

(f)       Stock
Restrictions. Each certificate representing Restricted Stock awarded under the Plan shall bear a legend in such form as the
Company deems appropriate.

 

7.3       Performance
Share Awards.

 

(a)       Grant
of Performance Share Awards. Each Performance Share Award granted under the Plan shall be evidenced by an Award Agreement.
Each Performance Share Award so granted shall be subject to the conditions set forth in this Section 7.3, and to such other conditions
not inconsistent with the Plan as may be reflected in the applicable Award Agreement. The Committee shall have the discretion to
determine: (i) the number of shares of Common Stock or stock-denominated units subject to a Performance Share Award granted to
any Participant; (ii) the performance period applicable to any Award; (iii) the conditions that must be satisfied for a Participant
to earn an Award; and (iv) the other terms, conditions and restrictions of the Award.

 

(b)       Earning
Performance Share Awards. The number of Performance Shares earned by a Participant will depend on the extent to which the performance
goals established by the Committee are attained within the applicable Performance Period, as determined by the Committee. No payout
shall be made with respect to any Performance Share Award except upon written certification by the Committee that the minimum threshold
performance goal(s) have been achieved.

 

 

 

 

    	 	13	 

     

    

 

7.4       Performance
Cash Awards. A Performance Cash Award is a cash award (for a dollar value not in excess of $50,000)
that is payable contingent upon the attainment during a Performance Period of certain Performance Goals. A Performance Cash Award
may also require the completion of a specified period of Continuous Service. At the time of grant of a Performance Cash Award,
the length of any Performance Period, the Performance Goals to be achieved during the Performance Period, and the measure of whether
and to what degree such Performance Goals have been attained will be conclusively determined by the Board or Committee,
in its sole discretion. The Board may specify the form of payment of Performance Cash Awards, which
may be cash or other property, or may provide for a Participant to have the option for his or her Performance Cash Award, or such
portion thereof as the Board may specify, to be paid in whole or in part in cash or other property.

 

8.       Securities
Law Compliance. Each Award Agreement shall provide that no shares of Common Stock shall be purchased or sold thereunder
unless and until (a) any then applicable requirements of state or federal laws and regulatory agencies have been fully complied
with to the satisfaction of the Company and its counsel and (b) if required to do so by the Company, the Participant has executed
and delivered to the Company a letter of investment intent in such form and containing such provisions as the Committee may require.
The Company shall use reasonable efforts to seek to obtain from each regulatory commission or agency having jurisdiction over the
Plan such authority as may be required to grant Awards and to issue and sell shares of Common Stock upon exercise of the Awards;
provided, however, that this undertaking shall not require the Company to register under the Securities Act the Plan, any Award
or any Common Stock issued or issuable pursuant to any such Award. If, after reasonable efforts, the Company is unable to obtain
from any such regulatory commission or agency the authority which counsel for the Company deems necessary for the lawful issuance
and sale of Common Stock under the Plan, the Company shall be relieved from any liability for failure to issue and sell Common
Stock upon exercise of such Awards unless and until such authority is obtained.

 

9.       Use
of Proceeds from Stock. Proceeds from the sale of Common Stock pursuant to Awards, or upon exercise thereof, shall constitute
general funds of the Company.

 

10.       Miscellaneous.

 

10.1       Acceleration
of Exercisability and Vesting. The Committee shall have the power to accelerate the time at which an Award may first
be exercised or the time during which an Award or any part thereof will vest in accordance with the Plan, notwithstanding the provisions
in the Award stating the time at which it may first be exercised or the time during which it will vest.

 

10.2       Shareholder
Rights. Except as provided in the Plan or an Award Agreement, no Participant shall be deemed to be the holder of, or
to have any of the rights of a holder with respect to, any shares of Common Stock subject to such Award unless and until such Participant
has satisfied all requirements for exercise of the Award pursuant to its terms and no adjustment shall be made for dividends (ordinary
or extraordinary, whether in cash, securities or other property) or distributions of other rights for which the record date is
prior to the date such Common Stock certificate is issued, except as provided in Section 11 hereof.

 

10.3       No
Employment or Other Service Rights. Nothing in the Plan or any instrument executed or Award granted pursuant thereto
shall confer upon any Participant any right to continue to serve the Company or an Affiliate in the capacity in effect at the time
the Award was granted or shall affect the right of the Company or an Affiliate to terminate (a) the employment of an Employee with
or without notice and with or without Cause or (b) the service of a Director pursuant to the By-laws of the Company or an Affiliate,
and any applicable provisions of the corporate law of the state in which the Company or the Affiliate is incorporated, as the case
may be.

 

10.4       Transfer;
Approved Leave of Absence. For purposes of the Plan, no termination of employment by an Employee shall be deemed to
result from either (a) a transfer of employment to the Company from an Affiliate or from the Company to an Affiliate, or from one
Affiliate to another, or (b) an approved leave of absence for military service or sickness, or for any other purpose approved by
the Company, if the Employee’s right to reemployment is guaranteed either by a statute or by contract or under the policy
pursuant to which the leave of absence was granted or if the Committee otherwise so provides in writing, in either case, except
to the extent inconsistent with Section 409A of the Code if the applicable Award is subject thereto.

 

 

 

 

    	 	14	 

     

    

 

10.5       Withholding
Obligations. To the extent provided by the terms of an Award Agreement and subject to the discretion of the Committee,
the Participant may satisfy any federal, state or local tax withholding obligation relating to the exercise or acquisition of Common
Stock under an Award by any of the following means (in addition to the Company’s right to withhold from any compensation
paid to the Participant by the Company) or by a combination of such means: (a) tendering a cash payment; (b) authorizing the Company
to withhold shares of Common Stock from the shares of Common Stock otherwise issuable to the Participant as a result of the exercise
or acquisition of Common Stock under the Award, provided, however, that no shares of Common Stock are withheld with a value exceeding
the minimum amount of tax required to be withheld by law; or (c) delivering to the Company previously owned and unencumbered shares
of Common Stock of the Company.

 

11.       Adjustments
Upon Changes in Stock. In the event of changes in the outstanding Common Stock or in the capital structure of the Company
by reason of any stock or extraordinary cash dividend, stock split, reverse stock split, an extraordinary corporate transaction
such as any recapitalization, reorganization, merger, consolidation, combination, exchange, or other relevant change in capitalization
occurring after the Grant Date of any Award, Awards granted under the Plan and any Award Agreements, the exercise price of Options
and Stock Appreciation Rights, the maximum number of shares of Common Stock subject to all Awards stated in Section 4 and the maximum
number of shares of Common Stock with respect to which any one person may be granted Awards during any period stated in Section
4 will be equitably adjusted or substituted, as to the number, price or kind of a share of Common Stock or other consideration
subject to such Awards to the extent necessary to preserve the economic intent of such Award. In the case of adjustments made pursuant
to this Section 11, unless the Committee specifically determines that such adjustment is in the best interests of the Company or
its Affiliates, the Committee shall, in the case of Incentive Stock Options, ensure that any adjustments under this Section 11
will not constitute a modification, extension or renewal of the Incentive Stock Options within the meaning of Section 424(h)(3)
of the Code and in the case of Non-qualified Stock Options, ensure that any adjustments under this Section 11 will not constitute
a modification of such Non-qualified Stock Options within the meaning of Section 409A of the Code. Any adjustments made under this
Section 11 shall be made in a manner which does not adversely affect the exemption provided pursuant to Rule 16b-3 under the Exchange
Act. The Company shall give each Participant notice of an adjustment hereunder and, upon notice, such adjustment shall be conclusive
and binding for all purposes.

 

12.       Effect
of Change in Control.

 

12.1       Unless
otherwise provided in an Award Agreement, notwithstanding any provision of the Plan to the contrary:

 

(a)       In
the event of a Change in Control, all Options and Stock Appreciation Rights shall become immediately exercisable with respect to
100% of the shares subject to such Options or Stock Appreciation Rights, and the Restricted Period shall expire immediately with
respect to 100% of the shares of Restricted Stock or Restricted Stock Units.

 

(b)       With
respect to Performance Share Awards and Performance Cash Awards, in the event of a Change in Control, all incomplete Performance
Periods in respect of such Award in effect on the date the Change in Control occurs shall end on the date of such change and the
Committee shall (i) determine the extent to which Performance Goals with respect to each such Performance Period have been met
based upon such audited or unaudited financial information then available as it deems relevant and (ii) cause to be paid to the
applicable Participant partial or full Awards with respect to Performance Goals for each such Performance Period based upon the
Committee’s determination of the degree of attainment of Performance Goals or, if not determinable, assuming that the applicable
“target” levels of performance have been attained, or on such other basis determined by the Committee.

 

To the extent practicable,
any actions taken by the Committee under the immediately preceding clauses (a) and (b) shall occur in a manner and at a time which
allows affected Participants the ability to participate in the Change in Control with respect to the shares of Common Stock subject
to their Awards.

 

12.2       In
addition, in the event of a Change in Control, the Committee may in its discretion and upon at least 10 days’ advance notice
to the affected persons, cancel any outstanding Awards and pay to the holders thereof, in cash or stock, or any combination thereof,
the value of such Awards based upon the price per share of Common Stock received or to be received by other shareholders of the
Company in the event. In the case of any Option or Stock Appreciation Right with an exercise price (or SAR Exercise Price in the
case of a Stock Appreciation Right) that equals or exceeds the price paid for a share of Common Stock in connection with the Change
in Control, the Committee may cancel the Option or Stock Appreciation Right without the payment of consideration therefor.

 

 

 

    	 	15	 

     

    

 

12.3       The
obligations of the Company under the Plan shall be binding upon any successor corporation or organization resulting from the merger,
consolidation or other reorganization of the Company, or upon any successor corporation or organization succeeding to all or substantially
all of the assets and business of the Company and its Affiliates, taken as a whole.

 

13.       Amendment
of the Plan and Awards.

 

13.1       Amendment
of Plan. The Board at any time, and from time to time, may amend or terminate the Plan. However, except as provided
in Section 11 relating to adjustments upon changes in Common Stock and Section 13.3, no amendment shall be effective unless approved
by the shareholders of the Company to the extent shareholder approval is necessary to satisfy any Applicable Laws. At the time
of such amendment, the Board shall determine, upon advice from counsel, whether such amendment will be contingent on shareholder
approval.

 

13.2       Shareholder
Approval. The Board may, in its sole discretion, submit any other amendment to the Plan for shareholder approval.

 

13.3       Contemplated
Amendments. It is expressly contemplated that the Board may amend the Plan in any respect the Board deems necessary
or advisable to provide eligible Employees, Consultants and Directors with the maximum benefits provided or to be provided under
the provisions of the Code and the regulations promulgated thereunder relating to Incentive Stock Options or to the nonqualified
deferred compensation provisions of Section 409A of the Code and/or to bring the Plan and/or Awards granted under it into compliance
therewith.

 

13.4       No
Impairment of Rights. Rights under any Award granted before amendment of the Plan shall not be impaired by any amendment
of the Plan unless (a) the Company requests the consent of the Participant and (b) the Participant consents in writing.

 

13.5       Amendment
of Awards. The Committee at any time, and from time to time, may amend the terms of any one or more Awards; provided,
however, that the Committee may not affect any amendment which would otherwise constitute an impairment of the rights under any
Award unless (a) the Company requests the consent of the Participant and (b) the Participant consents in writing.

 

14.       General
Provisions.

 

14.1       Forfeiture
Events. Each Award and the Participant’s rights, payments and benefits with respect to an Award shall be subject
to reduction, cancellation, forfeiture or recoupment upon the occurrence of the events described below, in addition to applicable
vesting conditions of an Award. Such events include a breach of a duty of confidentiality, competing with the Company, soliciting
Company personnel after employment is terminated, failure to assign any invention or technology to the Company if such assignment
is a condition of employment or any other agreements between the Company and the Participant, a termination of the Participant’s
Continuous Service for Cause, violation of the Company’s insider trading policy, or other conduct by the Participant that
is detrimental to the business or reputation of the Company and/or its Affiliates as determined by the Board.

 

14.2       Clawback.
Notwithstanding any other provisions in this Plan, any Award which is subject to recovery under any law, government regulation
or stock exchange listing requirement, will be subject to such deductions and clawback as may be required to be made pursuant to
such law, government regulation or stock exchange listing requirement (or any policy adopted by the Company pursuant to any such
law, government regulation or stock exchange listing requirement).

 

14.3       Other
Compensation Arrangements. Nothing contained in this Plan shall prevent the Board from adopting other or additional
compensation arrangements, subject to shareholder approval if such approval is required; and such arrangements may be either generally
applicable or applicable only in specific cases.

 

 

 

 

    	 	16	 

     

    

 

14.4       Sub-plans.
The Committee may from time to time establish sub-plans under the Plan for purposes of satisfying blue sky, securities, tax or
other laws of various jurisdictions in which the Company intends to grant Awards. Any sub-plans shall contain such limitations
and other terms and conditions as the Committee determines are necessary or desirable. All sub-plans shall be deemed a part of
the Plan, but each sub-plan shall apply only to the Participants in the jurisdiction for which the sub-plan was designed.

 

14.5       Deferral
of Awards. The Committee may establish one or more programs under the Plan to permit selected Participants the opportunity
to elect to defer receipt of consideration upon exercise of an Award, satisfaction of performance criteria, or other event that
absent the election would entitle the Participant to payment or receipt of shares of Common Stock or other consideration under
an Award. The Committee may establish the election procedures, the timing of such elections, the mechanisms for payments of, and
accrual of interest or other earnings, if any, on amounts, shares or other consideration so deferred, and such other terms, conditions,
rules and procedures that the Committee deems advisable for the administration of any such deferral program.

 

14.6       Unfunded
Plan. The Plan shall be unfunded. Neither the Company, the Board nor the Committee shall be required to establish any
special or separate fund or to segregate any assets to assure the performance of its obligations under the Plan.

 

14.7       Recapitalizations.
Each Award Agreement shall contain provisions required to reflect the provisions of Section 11.

 

14.8       Delivery.
Upon exercise of a right granted under this Plan, the Company shall issue Common Stock or pay any amounts due within a reasonable
period of time thereafter. Subject to any statutory or regulatory obligations the Company may otherwise have, for purposes of this
Plan, 30 days shall be considered a reasonable period of time.

 

14.9       No
Fractional Shares. No fractional shares of Common Stock shall be issued or delivered pursuant to the Plan. The Committee
shall determine whether cash, additional Awards or other securities or property shall be issued or paid in lieu of fractional shares
of Common Stock or whether any fractional shares should be rounded, forfeited or otherwise eliminated.

 

14.10       Other
Provisions. The Award Agreements authorized under the Plan may contain such other provisions not inconsistent with this
Plan, including, without limitation, restrictions upon the exercise of the Awards, as the Committee may deem advisable.

 

14.11       Section
409A. The Plan is intended to comply with Section 409A of the Code to the extent subject thereto, and, accordingly,
to the maximum extent permitted, the Plan shall be interpreted and administered to be in compliance therewith. Any payments described
in the Plan that are due within the “short-term deferral period” as defined in Section 409A of the Code shall not be
treated as deferred compensation unless Applicable Laws require otherwise. Notwithstanding anything to the contrary in the Plan,
to the extent required to avoid accelerated taxation and tax penalties under Section 409A of the Code, amounts that would otherwise
be payable and benefits that would otherwise be provided pursuant to the Plan during the six (6) month period immediately following
the Participant’s termination of Continuous Service shall instead be paid on the first payroll date after the six-month anniversary
of the Participant’s separation from service (or the Participant’s death, if earlier). Notwithstanding the foregoing,
neither the Company nor the Committee shall have any obligation to take any action to prevent the assessment of any excise tax
or penalty on any Participant under Section 409A of the Code and neither the Company nor the Committee will have any liability
to any Participant for such tax or penalty.

 

14.12       Disqualifying
Dispositions. Any Participant who shall make a “disposition” (as defined in Section 424 of the Code) of
all or any portion of shares of Common Stock acquired upon exercise of an Incentive Stock Option within two years from the Grant
Date of such Incentive Stock Option or within one year after the issuance of the shares of Common Stock acquired upon exercise
of such Incentive Stock Option (a “Disqualifying Disposition”) shall be required to immediately advise the Company
in writing as to the occurrence of the sale and the price realized upon the sale of such shares of Common Stock.

 

14.13       Section
16. It is the intent of the Company that the Plan satisfy, and be interpreted in a manner that satisfies, the applicable
requirements of Rule 16b-3 as promulgated under Section 16 of the Exchange Act so that Participants will be entitled to the benefit
of Rule 16b-3, or any other rule promulgated under Section 16 of the Exchange Act, and will not be subject to short-swing liability
under Section 16 of the Exchange Act. Accordingly, if the operation of any provision of the Plan would conflict with the intent
expressed in this Section 14.13, such provision to the extent possible shall be interpreted and/or deemed amended so as to avoid
such conflict.

 

 

 

 

    	 	17	 

     

    

 

14.14       [Reserved]

 

14.15       Beneficiary
Designation. Each Participant under the Plan may from time to time name any beneficiary or beneficiaries by whom any
right under the Plan is to be exercised in case of such Participant’s death. Each designation will revoke all prior designations
by the same Participant, shall be in a form reasonably prescribed by the Committee and shall be effective only when filed by the
Participant in writing with the Company during the Participant’s lifetime.

 

14.16       Expenses.
The costs of administering the Plan shall be paid by the Company.

 

14.17       Severability.
If any of the provisions of the Plan or any Award Agreement is held to be invalid, illegal or unenforceable, whether in whole or
in part, such provision shall be deemed modified to the extent, but only to the extent, of such invalidity, illegality or unenforceability
and the remaining provisions shall not be affected thereby.

 

14.18       Plan
Headings. The headings in the Plan are for purposes of convenience only and are not intended to define or limit the
construction of the provisions hereof.

 

14.19       Non-Uniform
Treatment. The Committee’s determinations under the Plan need not be uniform and may be made by it selectively
among persons who are eligible to receive, or actually receive, Awards. Without limiting the generality of the foregoing, the Committee
shall be entitled to make non-uniform and selective determinations, amendments and adjustments, and to enter into non-uniform and
selective Award Agreements.

 

15.       Termination
or Suspension of the Plan. The Plan shall terminate automatically 10 years from the Effective Date. No Award shall be
granted pursuant to the Plan after such date, but Awards theretofore granted may extend beyond that date. The Board may suspend
or terminate the Plan at any earlier date pursuant to Section 13.1 hereof. No Awards may be granted under the Plan while the Plan
is suspended or after it is terminated.

 

16.       Choice
of Law. The law of the State of New York shall govern all questions concerning the construction, validity and
interpretation of this Plan, without regard to such state’s conflict of law rules.

 

As adopted by the Board
of Directors on December 17, 2020.

 

As approved by the
Company’s shareholders on _______________, 2021.

 

 

 

 

 

    	 	18IntelGenx Technologies Corp.: Exhibit 4.1 - Filed by newsfilecorp.com

    

     

     

    SECOND SUPPLEMENTAL TRUST INDENTURE TO THE TRUST INDENTURE DATED 

    AS OF JULY 12, 2017

     

     

    between

    INTELGENX TECHNOLOGIES CORP.

    and

    TSX Trust Company

     

     

     

     

    Dated as of June 25, 2020

    

    TABLE OF CONTENTS

     

    	Article 1 INTERPRETATION	 3
	 	 	 	 	 
	 	1.1	 	To Be Read with Indenture	 3
	 	1.2	 	Definitions	 4
	 	 	 	 	 
	Article 2 AMENDMENTS TO THE INDENTURE	 4
	 	 	 	 	 
	 	2.1	 	Amendments	 4
	 	 	 	 	 
	Article 3 CONCERNING THIS TRUST INDENTURE	 5
	 	 	 	 	 
	 	3.1	 	Concerning this Trust Indenture	 5
	 	 	 	 	 
	Article 4 MISCELLANEOUS	 5
	 	 	 	 	 
	 	4.1	 	Effective Date	 5
	 	4.2	 	Confirmation	 5
	 	4.3	 	Acceptance of Trust	 6
	 	4.4	 	Execution	 6
	 	4.5	 	Confirmation of Indenture	 6

     

    
        2

    

    

    THIS SECOND SUPPLEMENTAL TRUST INDENTURE TO THE TRUST INDENTURE DATED AS OF JULY 12, 2017 is made as of June 25, 2020

    	
                BETWEEN:

            	
                INTELGENX TECHNOLOGIES CORP., a corporation incorporated under the laws of Delaware

                (hereinafter referred to as the "Corporation")

            
	 	 
	
                AND:

            	
                TSX TRUST COMPANY, a trust company incorporated under the federal laws of Canada

                (hereinafter referred to as the "Debenture Trustee")

            

    WHEREAS the Corporation and the Debenture Trustee entered into a trust indenture dated as of July 12, 2017, as amended by a first supplemental indenture dated as of August 8, 2017 (together, the "Indenture");

    WHEREAS this second supplemental trust indenture to the Indenture (the "Second Supplemental Indenture") is entered into for the purpose of amending the terms of the Debentures to (i) extend the maturity date of the Debentures to June 30, 2022, and (ii) decrease the Conversion Price to $0.50 such that 2,000 Common Shares will be issued for each $1,000 principal amount of Debentures converted, subject to the adjustment pursuant to the provisions of Section 6.4 of the Indenture;

    WHEREAS in accordance with Section 13.11(c) of the Indenture, the Debentureholders have, by Extraordinary Resolution, assented to the proposed modifications and have authorized the Debenture Trustee to concur in and execute this Second Supplemental Indenture;

    AND WHEREAS the foregoing recitals are made as representations and statements of fact by the Corporation and not by the Debenture Trustee;

    NOW THEREFORE THIS AGREEMENT WITNESSES that for good and valuable consideration mutually given and received, the receipt and sufficiency of which is hereby acknowledged, it is hereby covenanted, agreed and declared as follows:

    ARTICLE 1
INTERPRETATION

    1.1 To Be Read with Indenture

    This Second Supplemental Indenture is a "supplemental indenture" as that term is used in the Indenture. The Indenture and the Second Supplemental Indenture shall be read together and shall have effect as though all of the provisions of both indentures were contained in one instrument.

    
        3

    

    

    1.2 Definitions

    In this Second Supplemental Indenture, unless there is something in the subject matter or context inconsistent therewith, the following expressions shall have the following meanings. Capitalized terms not otherwise defined herein shall have the meaning ascribed thereto in the Indenture:

    1.2.1 "Second Supplemental Indenture" has the meaning set forth in the preamble hereto; and

    1.2.2 "Indenture" has the meaning set forth in the preamble hereto.

    ARTICLE 2
AMENDMENTS TO THE INDENTURE

    2.1 Amendments

    2.1.1 The reference to "June 30, 2020" in Section 2.1 of the Indenture is hereby replaced by "June 30, 2022".

    2.1.2 Section 1.1.19 of the Indenture is hereby deleted in its entirety and replaced by the following:

    ""Conversion Price" means $0.50 per Common Share as same may be adjusted, from time to time, in accordance with the provisions of Section 6.4;"

    2.1.3 Section 1.1.46 of the Indenture is hereby deleted in its entirety and replaced by the following:

    ""Maturity Date" means June 30, 2022;"

    2.1.4 Section 2.2(a) of the Indenture is hereby deleted in its entirety and replaced by the following:

    "Maturity Date. The Debentures will mature on June 30, 2022."

    2.1.5 Section 2.2(b) of the Indenture is hereby deleted in its entirety and replaced by the following:

    "Interest. The Debentures will bear interest from, and including, July 12, 2017 at the rate of 8.00% per annum, payable in equal semi-annual payments in arrears on June 30 and December 31 of each year, the first such payment falling due on December 31, 2017 and the last such payment falling due on June 30, 2022, payable after as well as before maturity and after as well as before default, with interest on amounts in default at the same rate, compounded semi-annually. The first interest payment will include interest accrued from and including July 12, 2017 to but excluding December 31, 2017 and will be in an amount equal to $37.70 per $1,000 principal amount of the Debentures."

    
        4

    

    

    2.1.6 Section 2.2(f) of the Indenture is hereby deleted in its entirety and replaced by the following:

    "Conversion Price. The Conversion Price in effect on the date hereof for each Common Share to be issued upon the conversion of Debentures will be equal to $0.50 such that 2,000 Common Shares will be issued for each $1,000 principal amount of Debentures so converted, subject to the terms of Section 6.4. The Conversion Price is subject to adjustment pursuant to the provisions of Section 6.4. Debentureholders converting their Debentures will receive accrued and unpaid interest from, and including, the last Interest Payment Date prior to the Date of Conversion (or the date of issue if converting prior to the first Interest Payment Date) to, but excluding, the Date of Conversion. Notwithstanding the foregoing, no Debenture may be converted on an Interest Payment Date or the Maturity Date, or during the 5 Business Days preceding either event."

    2.1.7 The schedule attached as Schedule A to the Indenture is hereby deleted in its entirety and replaced by Schedule A attached hereto.

    2.1.8 The schedule attached as Schedule C to the Indenture is hereby amended by replacing the words "June 30, 2020" in the first paragraph thereof with "June 30, 2022".

    ARTICLE 3
CONCERNING THIS TRUST INDENTURE

    3.1 Concerning this Trust Indenture

    To the extent of any conflict between the description of the Debentures in any term sheet, prospectus or other offering document which qualifies for distribution any Debentures governed by this Second Supplemental Indenture, the terms and conditions of this Second Supplemental Indenture shall take precedence and govern.

    ARTICLE 4
MISCELLANEOUS

    4.1 Effective Date

    This Second Supplemental Indenture shall come into effect on June 30, 2020.

    4.2 Confirmation

    The Corporation and the Debenture Trustee hereby acknowledge and confirm that except as specifically amended by the terms of this Second Supplemental Indenture, all of the terms and conditions of the Indenture shall remain in full force and effect unamended, in accordance with the provisions thereof. The matters provided for in this Second Supplemental Indenture shall not prejudice any act or thing done prior to the date hereof and do not constitute novation.

    
        5

    

    

    4.3 Acceptance of Trust

    The Debenture Trustee hereby accepts the trusts in this Second Supplemental Indenture declared and provided for and agrees to perform the same upon the terms and conditions set forth in this Second Supplemental Indenture and the Indenture and to hold all rights, privileges and benefits conferred hereby and by law in trust for the various persons who will from time to time be Debentureholders, subject to all the terms and conditions set forth in this Second Supplemental Indenture and the Indenture.

    4.4 Execution

    This Second Supplemental Indenture may be executed and delivered by facsimile and in counterparts, each of which when so executed and delivered will be deemed to be an original and such counterparts together constitute one and the same instrument and notwithstanding their date of execution they are deemed to be dated as of the date hereof.

    4.5 Confirmation of Indenture

    The Indenture as amended and supplemented by this Second Supplemental Indenture is in all respects confirmed.

    [Remainder of this page intentionally left blank.]

    
        6

    

    

    IN WITNESS WHEREOF the parties hereto have executed this Second Supplemental Indenture as of the date first written above.

    
        	
                    INTELGENX TECHNOLOGIES CORP.

                
	
                     

                
	
                    Per:

                	
                    /s/ Horst G. Zerbe

                
	
                     

                	
                    Name:

                	
                    Horst G. Zerbe

                
	
                     

                	
                    Title:

                	
                    Chief Executive Officer

                
	
                     

                
	
                    TSX TRUST COMPANY

                
	
                     

                
	
                    Per:

                	
                    /s/ Donald Crawford

                
	
                     

                	
                    Name:

                	
                    Donald Crawford

                
	
                     

                	
                    Title:

                	
                    Senior Trust Officer

                
	
                     

                
	
                    Per:

                	
                    /s/ Brett Higgs

                
	
                     

                	
                    Name:

                	
                    Brett Higgs

                
	
                     

                	
                    Title:

                	
                    Corporate Trust Officer

                
	
                     

                

    

    

    
        7

    

    

    SCHEDULE A

    TO THE TRUST INDENTURE BETWEEN
INTELGENX TECHNOLOGIES CORP. AND
TSX TRUST COMPANY
FORM OF DEBENTURE

    This Debenture is a Global Debenture within the meaning of the Indenture herein referred to and is registered in the name of a Depository or a nominee thereof. This Debenture may not be transferred to or exchanged for Debentures registered in the name of any Person other than the Depository or a nominee thereof and no such transfer may be registered except in the limited circumstances described in the Indenture. Every Debenture authenticated and delivered upon registration of, transfer of, or in exchange for, or in lieu of, this Debenture shall be a Global Debenture subject to the foregoing, except in such limited circumstances described in the Indenture.

    UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF CDS CLEARING AND DEPOSITORY SERVICES INC. ("CDS") TO INTELGENX TECHNOLOGIES CORP. OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IN RESPECT THEREOF IS REGISTERED IN THE NAME OF CDS & CO., OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF CDS (AND ANY PAYMENT IS MADE TO CDS & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF CDS), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED HOLDER HEREOF, CDS & CO., HAS A PROPERTY INTEREST IN THE SECURITIES REPRESENTED BY THIS CERTIFICATE HEREIN AND IT IS A VIOLATION OF ITS RIGHTS FOR ANOTHER PERSON TO HOLD, TRANSFER OR DEAL WITH THIS CERTIFICATE.

    	
                No. ●

            	
                CUSIP 45822RAA9
ISIN CA45822RAA91

            

    INTELGENX TECHNOLOGIES CORP.

    (A corporation existing under the laws of Delaware)

    8.00% Convertible Unsecured Subordinated Debentures Due June 30, 2022

    	
                Date of Issue: ●, 2017

            	
                Maturity Date: June 30, 2022

            
	Registered Holder: ●	 

     

    INTELGENX TECHNOLOGIES CORP. (the "Corporation") for value received hereby acknowledges itself indebted and, subject to the provisions of the Trust Indenture (the "Indenture") dated July 12, 2017 between the Corporation and TSX Trust Company (the "Debenture Trustee"), promises to pay to the registered holder hereof on the maturity date of this Debenture, as hereinafter described, or on such earlier date as the principal amount hereof may become due in accordance with the provisions of the Indenture, the principal amount of

    

    
        A-2

    

    $●

    in lawful money of Canada, as may be adjusted as set out in 0, on presentation and surrender of this Debenture at the main branch of the Debenture Trustee in Toronto, Ontario in accordance with the terms of the Indenture.

    This Debenture is one of the 8.00% Convertible Unsecured Subordinated Debentures (referred to herein as the "Debentures") of the Corporation issued or issuable under the provisions of the Indenture. Reference is hereby expressly made to the Indenture for a description of the terms and conditions upon which the Debentures are to be issued and held and the rights and remedies of the holders of the Debentures and of the Corporation and of the Debenture Trustee, all to the same effect as if the provisions of the Indenture were herein set forth to all of which provisions the holder of this Debenture by acceptance hereof assents.

    The maturity date (the "Maturity Date") for the Debentures will be June 30, 2022. The Debentures will bear interest at the rate of 8.00% per annum, payable in equal semi-annual payments, in arrears, on June 30 and December 31 in each year, the first such payment to fall due on December 31, 2017, payable after as well as before maturity and after as well as before default, with interest on amounts in default at the same rate, compounded semi-annually.

    Interest hereon will be payable (less applicable Withholding Taxes, if any) by cheque mailed by prepaid ordinary mail or by electronic transfer of funds to the registered holder hereof and, subject to the provisions of the Indenture, the mailing of such cheque or the sending of the electronic transfer of funds, as the case may be, will, to the extent of the sum represented thereby (plus the amount of any tax withheld or deducted and remitted to the proper tax authority), satisfy and discharge all liability for interest on this Debenture.

    The Debentures are issuable only in denominations of $1,000 and integral multiples thereof. Upon compliance with the provisions of the Indenture, Debentures of any denomination may be exchanged for an equal aggregate principal amount of Debentures in any other authorized denomination or denominations.

    The principal of this Debenture is convertible, at the option of the holder hereof, upon surrender of this Debenture at the principal office of the Debenture Trustee in Toronto, Ontario, at any time and prior to the close of business on the Maturity Date or, if this Debenture is called for redemption on or prior to such date, then up to but not after the close of business on the last Business Day immediately preceding the date specified for redemption of this Debenture, into Common Shares at a conversion price of $0.50 (the "Conversion Price") per Common Share, being a rate of 2,000 Common Shares for each $1,000 principal amount of Debentures, all subject to the terms and conditions and in the manner set forth in the Indenture. Notwithstanding the foregoing, no Debenture may be converted during the last five Business Day preceding an Interest Payment Date or the Maturity Date. Holders of Debentures converting their Debentures will receive accrued and unpaid interest from and including the last Interest Payment Date (or the date of issue if there has not been an Interest Payment Date) to but excluding the Date of Conversion. The Indenture makes provision for the adjustment of the Conversion Price in the events therein specified. No fractional Common Shares will be issued on any conversion but, in lieu thereof, the Corporation will satisfy such fractional interest by a cash payment equal to the fractional interest multiplied by the Current Market Price of the Common Shares on the Date of Conversion determined in accordance with the Indenture.

    

    
        A-3

    

    This Debenture may be redeemed at the option of the Corporation on the terms and conditions set out in the Indenture at the redemption price therein and herein set out provided that this Debenture is not redeemable prior to June 30, 2018 (the "First Call Date") except in the event of the satisfaction of certain conditions after a Change of Control has occurred. On or after the First Call Date and prior to June 30, 2019 (the "Second Call Date"), the Debentures may be redeemed at the option of the Corporation at the redemption price equal to the principal amount of the Debentures (the "Redemption Price") provided the Current Market Price on the date on which the notice of redemption is given is at least 125% of the Conversion Price and, in addition thereto, at the time of redemption, the Corporation will pay to the holder accrued and unpaid interest on the terms and conditions described in the Indenture. On or after the Second Call Date and prior to the Maturity Date, the Debentures may be redeemed at the option of the Corporation at the Redemption Price, irrespective of the Current Market Price of the Common Shares, and, in addition thereto, at the time of redemption, the Corporation will pay to the holder accrued and unpaid interest on the terms and conditions described in the Indenture. The Corporation may, on notice as provided in the Indenture, at its option and subject to any applicable regulatory approval, elect to satisfy its obligation to pay all or a portion of the applicable Redemption Price by the issue of that number of Freely Tradeable Common Shares obtained by dividing the applicable Redemption Price by 95% of the Current Market Price of the Common Shares on the Redemption Date.

    Upon the occurrence of a Change of Control of the Corporation, the Corporation is required to make an offer to purchase all the Debentures at a price equal to 101% of the principal amount of such Debentures plus accrued and unpaid interest up to, but excluding, the date the Debentures are so repurchased (the "Offer"). If 90% or more of the aggregate principal amount of the Debentures issued under the Indenture outstanding on the date the Corporation provides notice of a Change of Control to the Debenture Trustee have been tendered for purchase pursuant to the Offer, the Corporation has the right to redeem all the remaining outstanding Debentures at the same price.

    The Corporation may, on notice as provided in the Indenture, at its option and subject to any applicable regulatory approval, elect to satisfy the obligation to repay all or any portion of the principal amount of this Debenture due on the Maturity Date by the issue of that number of Freely Tradeable Common Shares obtained by dividing the principal amount of this Debenture to be paid for in Common Shares pursuant to the exercise by the Corporation of the Common Share Repayment Right by 95% of the Current Market Price on the Maturity Date.

    The indebtedness evidenced by this Debenture, and by all other Debentures now or hereafter certified and delivered under the Indenture, is a direct unsecured obligation of the Corporation, and is subordinated in right of payment, to the extent and in the manner provided in the Indenture, to the prior payment of all Senior Indebtedness, whether outstanding at the date of the Indenture or thereafter created, incurred, assumed or guaranteed.

    The principal hereof may become or be declared due and payable before the stated maturity in the events, in the manner, with the effect and at the times provided in the Indenture.

    The Indenture contains provisions making binding upon all holders of Debentures outstanding thereunder resolutions passed at meetings of such holders held in accordance with such provisions and instruments signed by the holders of a specified majority of Debentures outstanding, which resolutions or instruments may have the effect of amending the terms of this Debenture or the Indenture.

    

    
        A-4

    

    All dollar amounts expressed in this Debenture are in lawful money of Canada and all payments required to be made hereunder will be made in Canadian dollars.

    This Debenture will not become obligatory for any purpose until it will have been certified by the Debenture Trustee under the Indenture.

    If any of the provisions of this Debenture are inconsistent with the provisions of the Indenture, the provisions of the Indenture will take precedence and will govern. Capitalized words or expressions used in this Debenture, unless otherwise defined herein, have the meaning attributed thereto in the Indenture.

    [Remainder of this page intentionally left blank.]

    

    
        A-5

    

    IN WITNESS WHEREOF IntelGenx Technologies Corp. has caused this Debenture to be signed by its duly authorized officer as of the ●th day of ●.

    	
                INTELGENX TECHNOLOGIES CORP.

            
	
                 

            
	
                Per:

            	
                 

            
	
                 

            	
                Name:

            	
                 

            
	
                 

            	
                Title:

            	
                 

            

    DEBENTURE TRUSTEE'S CERTIFICATE

    This Debenture is one of the 8.00% Convertible Unsecured Subordinated Debentures due June 30, 2022 of IntelGenx Technologies Corp. referred to in the Indenture within mentioned.

    	
                TSX TRUST COMPANY

            
	
                 

            
	
                Per:

            	
                 

            
	
                 

            	
                Authorized Signatory

            

    

    

    
        A-6

    

    FORM OF ASSIGNMENT

    FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto _______________, whose address and social insurance number, if applicable, are set forth below, this Debenture (or $ __________ principal amount hereof*) of IntelGenx Technologies Corp. standing in the name(s) of the undersigned in the register maintained with respect to such Debenture and does hereby irrevocably authorize and direct the Debenture Trustee to transfer such Debenture in such register, with full power of substitution in the premises. All dollar amounts expressed in this Form of Assignment are in lawful money of Canada.

    	
                Dated:

            	
                 

            
	
                Address of Transferee:

            	
                 

            
	
                 

            	
                (Street Address, City, Province/State and Postal/Zip Code and Country)

            
	
                Social Insurance Number of Transferee, if applicable:

            	
                 

            
	
                *

            	
                If less than the full principal amount of the within Debenture is to be transferred, indicate in the space provided the principal amount (which will be $1,000 or an integral multiple thereof ) to be transferred.

            
	 	 	 	 	 	 

    The signature(s) to this assignment must correspond with the name(s) as written upon the face of this 8.00% Debenture in every particular without alteration or any change whatsoever. The signature(s) must be guaranteed by one of the following methods:

    1. Canada and the USA: A Medallion Signature Guarantee obtained from a member of an acceptable Medallion Signature Guarantee Program (STAMP, SEMP, MSP). Many commercial banks, savings banks, credit unions, and all broker dealers participate in a Medallion Signature Guarantee Program. The Guarantor must affix a stamp bearing the actual words "Medallion Guaranteed".

    2. Canada: A Signature Guarantee obtained from a major Canadian Schedule 1 chartered bank. The Guarantor must affix a stamp bearing the actual words "Signature Guaranteed". Signature Guarantees are not accepted from Treasury Branches, Credit Unions or Caisses Populaires unless they are members of a Medallion Signature Guarantee Program.

    3. Outside North America: For holders located outside North America, present the certificate(s) and/or document(s) that require a guarantee to a local financial institution that has a corresponding Canadian or American affiliate which is a member of an acceptable Medallion Signature Guarantee Program. The corresponding affiliate will arrange for the signature to be over-guaranteed.

    The registered holder of this Debenture is responsible for the payment of any documentary, stamp or other transfer taxes that may be payable in respect of the transfer of this Debenture.

    

    
        A-7

    

    

    	
                Signature of Guarantor

            	
                 

            	
                 

            
	
                 

            	
                 

            	
                 

            
	
                 

            	
                 

            	
                 

            
	
                Authorized Officer

            	
                 

            	
                Signature of transferring registered holder

            
	
                 

            	
                 

            	
                 

            
	
                 

            	
                 

            	
                 

            
	
                Name of Institution

            	
                 

            	
                 

            

    

    

    
        A-8

    

    EXHIBIT 1

    8.00% Convertible Unsecured Subordinated Debentures due June 30, 2022

    CUSIP: 45822RAA9 /ISIN: CA45822RAA91

    	
                Initial Principal Amount

            	
                $●

            
	
                Authorization:

            	
                 

            	
                 

            

    ADJUSTMENTS

    	
                Date of Registration

            	
                Amount of
Increase

            	
                Amount of
Decrease

            	
                New Principal Amount

            	
                Authorization

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