Document:

Exhibit 10.6

 

HELIX
TCS, INC.

 

2017
omnibus STOCK INCENTIVE PLAN

 

Approved
by the Board: October 17, 2017

Approved
by the Stockholders: October 17, 2017

 

1.      
Purposes of the Plan. The purposes of this Plan are to attract and retain the best available personnel; to provide additional
incentives to Employees, Directors and Consultants to contribute to the successful performance of the Company and any Subsidiary
of the Company; to promote the growth of the market value of the Company’s Common Stock; to align the interests of Grantees
with those of the Company’s stockholders; and to promote the success of the Company’s business.

 

2.      
Definitions. The following definitions shall apply as used herein and in all individual Award Agreements except as a term
may be otherwise defined in an individual Award Agreement. In the event a term is separately defined in an individual Award Agreement,
such definition shall supersede the definition contained in this Section 2.

 

(a)     
“Administrator” means the Plan Administrator as described in Section 4.

 

(b)    
“Applicable Laws” means the legal requirements relating to the Plan and the Awards under applicable
provisions of federal and state securities laws, the corporate laws of Delaware, and, to the extent other than Delaware, the corporate
law of the state of the Company’s incorporation, the Code, the rules of any applicable stock exchange or national market
system, and the rules of any non-U.S. jurisdiction applicable to Awards granted to residents therein.

 

(c)     
“Assumed” means that pursuant to a Corporate Transaction either (i) the Award is expressly affirmed
by the Company or (ii) the contractual obligations represented by the Award are expressly assumed (and not simply by operation
of law) by the successor entity or its Parent in connection with the Corporate Transaction with appropriate adjustments to the
number and type of securities of the successor entity or its Parent subject to the Award and the exercise or purchase price thereof
which at least preserves the compensation element of the Award existing at the time of the Corporate Transaction as determined
in accordance with the instruments evidencing the agreement to assume the Award.

 

(d)    
“Award” means the grant of an Option, SAR, Dividend Equivalent Right, Restricted Stock, Restricted Stock
Unit, or other right or benefit under the Plan.

 

(e)     
“Award Agreement” means the written agreement evidencing the grant of an Award executed by the Company
and the Grantee, including any amendments thereto.

 

(f)     
“Board” means the Board of Directors of the Company.

 

(g)    
“Cause” means, with respect to the termination by the Company or a Related Entity of a Grantee’s
Continuous Service:

 

(i)      
that such termination is for “Cause” as such term (or word of like import) is expressly defined in a then-effective
written employment agreement, consulting agreement, service agreement or other similar agreement between the Grantee and the Company
or such Related Entity, provided, however, that with regard to any agreement that defines “Cause” on the occurrence
of or in connection with a Corporate Transaction, such definition of “Cause” shall not apply until a Corporate Transaction
actually occurs; or

 

(ii)     
in the absence of such then-effective written agreement and definition, is based on, in the determination of the
Administrator: (A) the Grantee’s performance of any act, or failure to perform any act, in bad faith and to the
detriment of the Company or a Related Entity; (B) the Grantee’s dishonesty, intentional misconduct or material breach
of any agreement with the Company or a Related Entity; (C) the Grantee’s material breach of any noncompetition,
confidentiality or similar agreement with the Company or a Related Entity, as determined under such agreement; (D) the
Grantee’s commission of a crime involving dishonesty, breach of trust, or physical or emotional harm to any person; (E)
if the Grantee is an Employee or Consultant, the Grantee’s engaging in acts or omissions constituting gross negligence,
misconduct or a willful violation of a Company or a Related Entity policy which is or is reasonably expected to be materially
injurious to the Company and/or a Related Entity; or (F) if the Grantee is an Employee, the grantee’s failure to follow
the reasonable instructions of the Board or such grantee’s direct supervisor, which failure, if curable, is not cured
within ten (10) days after notice to such grantee or, if cured, recurs within one hundred eighty (180) days.

 

     

     

    

 

(h)     
“Code” means the Internal Revenue Code of 1986, as amended, or any successor statute.

 

(i)      
“Committee” means any committee composed of members of the Board appointed by the Board to administer
the Plan.

 

(j)      
“Common Stock” means the Company’s voting common stock, par value $0.001 per share.

 

(k)     
“Company” means Helix TCS, Inc., a Delaware corporation, or any successor entity that adopts the Plan
in connection with a Corporate Transaction.

 

(l)      
“Consultant” means any person (other than an Employee or a Director, solely with respect to rendering
services in such person’s capacity as a Director) who is engaged by the Company or any Related Entity to render consulting
or advisory services to the Company or such Related Entity.

 

(m)   
“Continuous Service” means that the provision of services to the Company or a Related Entity in any
capacity of Employee, Director or Consultant is not interrupted or terminated. In jurisdictions requiring notice in advance of
an effective termination as an Employee, Director or Consultant, Continuous Service shall be deemed terminated upon the actual
cessation of providing services to the Company or a Related Entity notwithstanding any required notice period that must be fulfilled
before a termination as an Employee, Director or Consultant can be effective under Applicable Laws. A Grantee’s Continuous
Service shall be deemed to have terminated either upon an actual termination of Continuous Service or upon the entity for which
the Grantee provides services ceasing to be a Related Entity. Continuous Service shall not be considered interrupted in the case
of (i) any approved leave of absence, (ii) transfers among the Company, any Related Entity, or any successor in any capacity of
Employee, Director or Consultant, or (iii) any change in status as long as the individual remains in the service of the Company
or a Related Entity in any capacity of Employee, Director or Consultant (except as otherwise provided in the Award Agreement).
An approved leave of absence for purposes of this Plan shall include sick leave, military leave, or any other authorized personal
leave, so long as the Company or Related Entity has a reasonable expectation that the individual will return to provide services
for the Company or Related Entity, and provided further that the leave does not exceed six (6) months, unless the individual has
a statutory or contractual right to re-employment following a longer leave. For purposes of each Incentive Stock Option granted
under the Plan, if such leave exceeds three (3) months, and reemployment upon expiration of such leave is not guaranteed by statute
or contract, then the Incentive Stock Option shall be treated as a Non-Qualified Stock Option beginning on the day three (3) months
and one (1) day following the expiration of such three (3) month period.

 

(n)     
“Corporate Transaction” means any of the following transactions, provided, however, that the Administrator
shall determine under parts (iv) and (v) whether multiple transactions are related, and its determination shall be final, binding
and conclusive:

 

(i)      
a merger or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of
which is to change the state in which the Company is incorporated;

 

(ii)     
the sale, transfer or other disposition of all or substantially all of the assets of the Company;

 

(iii)    
the complete liquidation or dissolution of the Company;

 

(iv)    
any reverse merger or series of related transactions culminating in a reverse merger (including, but not limited to, a tender
offer followed by a reverse merger) in which the Company is the surviving entity but (A) the Shares outstanding immediately prior
to such merger are converted or exchanged by virtue of the merger into other property, whether in the form of securities, cash
or otherwise, or (B) in which securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s
outstanding securities are transferred to a person or persons different from those who held such securities immediately prior
to such merger or the initial transaction culminating in such merger; or

 

    	 	2	 

     

    

 

(v)     
acquisition in a single or series of related transactions by any person or related group of persons (other than the Company or
by a Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of
securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities.

 

(o)    
“Covered Employee” means an Employee who is a “covered employee” under Section 162(m)(3)
of the Code.

 

(p)    
“Data” has the meaning set forth in Section 22 of this Plan.

 

(q)    
“Director” means a member of the Board or the board of directors of any Related Entity.

 

(r)      
“Disability” means a “disability” (or word of like import) as defined under the long-term
disability policy of the Company or the Related Entity to which the Grantee provides services regardless of whether the Grantee
is covered by such policy. If the Company or the Related Entity to which the Grantee provides service does not have a long-term
disability plan in place, “Disability” means that a Grantee is unable to carry out the responsibilities and functions
of the position held by the Grantee by reason of any medically determinable physical or mental impairment for a period of not
less than ninety (90) consecutive days. A Grantee will not be considered to have incurred a Disability unless he or she furnishes
proof of such impairment sufficient to satisfy the Administrator.

 

(s)     
“Disqualifying Disposition” means any disposition (including any sale) of Common Stock received upon
exercise of an Incentive Stock Option before either (i) two years after the date the Employee was granted the Incentive Stock
Option, or (ii) one year after the date the Employee acquired Common Stock by exercising the Incentive Stock Option. If the Employee
has died before such stock is sold, these holding period requirements do not apply and no Disqualifying Disposition can occur
thereafter.

 

(t)      
“Dividend Equivalent Right” means a right entitling the Grantee to compensation measured by dividends
paid with respect to Common Stock.

 

(u)     
“Employee” means any person, including an Officer or Director, who is in the employ of the Company or
any Related Entity, subject to the control and direction of the Company or any Related Entity as to both the work to be performed
and the manner and method of performance. The payment of a director’s fee by the Company or a Related Entity shall not be
sufficient to make such person an “Employee” of the Company or a Related Entity.

 

(v)     
“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

(w)    
“Fair Market Value” means, as of any date, the value of the Common Stock determined as follows.

 

(i)      
If the Common Stock is listed on one or more established stock exchanges or national market systems, including without limitation
The NASDAQ Global Select Market, The NASDAQ Global Market, or The NASDAQ Capital Market of The NASDAQ Stock Market LLC, its Fair
Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on the
principal exchange or system on which the Common Stock is listed (as determined by the Administrator) on the date of determination
(or, if no closing sales price or closing bid was reported on that date, as applicable, on the last trading date such closing
sales price or closing bid was reported), as reported in The Wall Street Journal or such other source as the Administrator deems
reliable;

 

(ii)     
If the Common Stock is regularly quoted on an automated quotation system (including the OTC Bulletin Board) or by a recognized
securities dealer, its Fair Market Value shall be the closing sales price for such stock as quoted on such system or by such securities
dealer on the date of determination, but if selling prices are not reported, the Fair Market Value of a Share shall be the mean
between the high bid and low asked prices for the Common Stock on the date of determination (or, if no such prices were reported
on that date, on the last date such prices were reported), as reported in The Wall Street Journal or such other source as the
Administrator deems reliable; or

 

(iii)    
In the absence of an established market for the Common Stock of the type described in (i) and (ii), above, the Fair Market
Value thereof shall be determined by the Administrator in good faith by application of a reasonable valuation method
consistently applied and taking into consideration all available information material to the value of the Company in a manner
in compliance with Section 409A of the Code, or in the case of an Incentive Stock Option, in a manner in compliance with
Section 422 of the Code.

 

    	 	3	 

     

    

 

(x)     
“Grantee” means an Employee, Director or Consultant who receives an Award under the Plan.

 

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

 

(z)     
“Non-Qualified Stock Option” means an Option not intended to qualify as an Incentive Stock Option.

 

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

 

(bb)  
“Option” means an option to purchase Shares pursuant to an Award Agreement granted under the Plan.

 

(cc)  
“Parent” means a “parent corporation,” whether now or hereafter existing, as defined in
Section 424(e) of the Code.

 

(dd)  
“Performance-Based Compensation” means any Award that the Administrator grants pursuant to Section 6(d)
of the Plan that is intended to qualify as “performance-based compensation” under Section 162(m) of the Code.

 

(ee)  
“Performance Period” means the time period during which specified performance criteria and/or continued
status as an Employee must be met as determined by the Administrator.

 

(ff)    
“Plan” means this Helix TCS, Inc. 2017 Omnibus Stock Incentive Plan, as the same may be amended from
time to time.

 

(gg)  
“Post-Termination Exercise Period” means the period specified in the Award Agreement of not less than
thirty (30) days commencing on the date of termination (other than termination by the Company or any Related Entity for Cause)
of the Grantee’s Continuous Service, or such longer period as may be applicable upon death or Disability.

 

(hh)  
“Related Entity” means any Parent or Subsidiary of the Company.

 

(ii)     
“Restricted Stock” means Shares issued under the Plan to the Grantee for such consideration, if any,
and subject to such restrictions on transfer, rights of first refusal, repurchase provisions, forfeiture provisions, and other
terms and conditions as established by the Administrator.

 

(jj)     
“Restricted Stock Units” means an Award which may be earned in whole or in part upon the passage of
time or the attainment of performance criteria established by the Administrator and which may be settled for cash, Shares or other
securities or a combination of cash, Shares or other securities as established by the Administrator.

 

(kk)  
“Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or any successor thereto.

 

(ll)     
“SAR” means a stock appreciation right entitling the Grantee to Shares or cash compensation, as established
by the Administrator, measured by appreciation in the value of Common Stock.

 

(mm)
“Share” means a share of the Common Stock.

 

(nn)  
“Subsidiary” means a “subsidiary corporation,” whether now or hereafter existing, as defined
in Section 424(f) of the Code.

 

(oo)  
“Tax Obligations” means all income tax, social insurance, payroll tax, fringe benefits tax, or other
tax-related liabilities related to a Grantee’s participation in the Plan and the receipt of any benefits hereunder, as determined
under the Applicable Laws.

 

    	 	4	 

     

    

 

3.      
Stock Subject to the Plan.

 

(a)     
Subject to adjustment as described in Section 13 below, the maximum aggregate number of Shares which may be issued pursuant to
all Awards (including Incentive Stock Options) is five million (5,000,000) Shares. The Shares may be authorized, but unissued,
or reacquired Common Stock.

 

(b)    
Any Shares covered by an Award (or portion of an Award) which is forfeited, canceled or expires (whether voluntarily or involuntarily)
shall be deemed not to have been issued for purposes of determining the maximum aggregate number of Shares which may be issued
under the Plan, except that the maximum aggregate number of Shares which may be issued pursuant to the exercise of Incentive Stock
Options shall not exceed the number specified in Section 3(a). Shares that actually have been issued under the Plan pursuant to
an Award shall not be returned to the Plan and shall not become available for future issuance under the Plan, except that if unvested
Shares are forfeited or repurchased by the Company, such Shares shall become available for future grant under the Plan. In the
event any Option or other Award granted under the Plan is exercised through the tendering of Shares (either actually or through
attestation), or in the event tax withholding obligations are satisfied by tendering or withholding Shares, any Shares so tendered
or withheld shall not again be available for awards under the Plan. To the extent that cash in lieu of Shares is delivered upon
the exercise of an SAR pursuant to Section 6(m), the Company shall be deemed, for purposes of applying the limitation on the number
of shares, to have issued the greater of the number of Shares which it was entitled to issue upon such exercise or on the exercise
of any related Option. Shares reacquired by the Company on the open market or otherwise using cash proceeds from the exercise
of Options shall not be available for awards under the Plan.

 

4.      
Administration of the Plan.

 

(a)     
Plan Administrator.

 

(i)      
Administration with Respect to Directors and Officers. With respect to grants of Awards to Directors or Employees who are
also Officers or Directors of the Company, the Plan shall be administered by (A) the Board or (B) a Committee designated by the
Board, which Committee shall be constituted in such a manner as to satisfy the Applicable Laws and to permit such grants and related
transactions under the Plan to be exempt from Section 16(b) of the Exchange Act in accordance with Rule 16b-3. Once appointed,
such Committee shall continue to serve in its designated capacity until otherwise directed by the Board.

 

(ii)     
Administration With Respect to Consultants and Other Employees. With respect to grants of Awards to Employees or Consultants
who are neither Directors nor Officers of the Company, the Plan shall be administered by (A) the Board or (B) a Committee designated
by the Board, which Committee shall be constituted in such a manner as to satisfy the Applicable Laws. Once appointed, such Committee
shall continue to serve in its designated capacity until otherwise directed by the Board.

 

(iii)    
Administration With Respect to Covered Employees. Notwithstanding the foregoing, grants of Awards to any Covered Employee
intended to qualify as Performance-Based Compensation shall be made only by a Committee (or subcommittee of a Committee) which
is comprised solely of two or more non-Employee Directors who are eligible under the provisions of Section 162(m) of the Code
to serve on a committee making Awards qualifying as Performance-Based Compensation. In the case of such Awards granted to Covered
Employees, references to the “Administrator” or to a “Committee” shall be deemed to be references to such
Committee or subcommittee.

 

(b)    
Multiple Administrative Bodies. The Plan may be administered by different bodies with respect to Directors, Officers, Consultants,
and Employees who are neither Directors nor Officers.

 

(c)     
Powers of the Administrator. Subject to Applicable Laws and the provisions of the Plan (including any other powers given
to the Administrator hereunder), and except as otherwise provided by the Board, the Administrator shall have the authority, in
its discretion:

 

(i)      
to select the Employees, Directors and Consultants to whom Awards may be granted from time to time hereunder;

 

(ii)     
to determine whether and to what extent Awards are granted hereunder;

 

    	 	5	 

     

    

 

(iii)    
to determine the number of Shares or the amount of other consideration to be covered by each Award granted hereunder;

 

(iv)    
to approve forms of Award Agreements for use under the Plan;

 

(v)     
to determine the type, terms and conditions of any Award granted hereunder;

 

(vi)    
to establish additional terms, conditions, rules or procedures to accommodate the rules or laws of applicable non-U.S. jurisdictions
and to afford Grantees favorable treatment under such rules or laws; provided, however, that no Award shall be granted under any
such additional terms, conditions, rules or procedures with terms or conditions which are inconsistent with the provisions of
the Plan;

 

(vii)   
to amend the terms of any outstanding Award granted under the Plan, provided that any amendment that would adversely affect the
Grantee’s rights under an outstanding Award shall not be made without the Grantee’s written consent; provided, however,
that an amendment or modification that may cause an Incentive Stock Option to become a Non-Qualified Stock Option shall not be
treated as adversely affecting the rights of the Grantee;

 

(viii)  
to construe and interpret the terms of the Plan and Awards, including without limitation, any notice of award or Award Agreement,
granted pursuant to the Plan;

 

(ix)    
to institute an option exchange program;

 

(x)     
to make other determinations as provided in this Plan; and

 

(xi)    
to take such other action, not inconsistent with the terms of the Plan, as the Administrator deems appropriate.

 

The
express grant in the Plan of any specific power to the Administrator shall not be construed as limiting any power or authority
of the Administrator; provided that the Administrator may not exercise any right or power reserved to the Board. Any decision
made, or action taken, by the Administrator or in connection with the administration of this Plan shall be final, conclusive and
binding on all persons having an interest in the Plan.

 

(d)    
Indemnification. In addition to such other rights of indemnification as they may have as members of the Board or as Officers
or Employees of the Company or a Related Entity, members of the Board and any Officers or Employees of the Company or a Related
Entity to whom authority to act for the Board, the Administrator or the Company is delegated shall be defended and indemnified
by the Company to the extent permitted by law on an after-tax basis against all reasonable expenses, including attorneys’
fees, actually and necessarily incurred in connection with the defense of any claim, investigation, action, suit or proceeding,
or in connection with any appeal therein, to which they or any of them may be a party by reason of any action taken or failure
to act under or in connection with the Plan, or any Award granted hereunder, and against all amounts paid by them in settlement
thereof (provided such settlement is approved by the Company) or paid by them in satisfaction of a judgment in any such claim,
investigation, action, suit or proceeding, except in relation to such liabilities, costs, and expenses as may arise out of, or
result from, the bad faith, gross negligence, willful misconduct, or criminal acts of such persons; provided, however, that within
thirty (30) days after the institution of such claim, investigation, action, suit or proceeding, such person shall offer to the
Company, in writing, the opportunity at the Company’s expense to defend the same.

 

5.      
Eligibility. Awards other than Incentive Stock Options may be granted to Employees, Directors, and Consultants of the Company
and any Related Entity. Incentive Stock Options may be granted only to Employees of the Company or a Related Entity. An Employee,
Director, or Consultant who has been granted an Award may, if otherwise eligible, be granted additional Awards. Awards may be
granted to such Employees, Directors, or Consultants who are residing in non-U.S. jurisdictions as the Administrator may determine
from time to time.

 

6.      
Terms and Conditions of Awards.

 

(a)      Types
of Awards. The Administrator is authorized under the Plan to award any type of arrangement to an Employee, Director or
Consultant that is not inconsistent with the provisions of the Plan and that by its terms involves or might involve the
issuance of (i) Shares, (ii) cash or (iii) an Option, an SAR, or similar right with a fixed or variable price related to the
Fair Market Value of the Shares and with an exercise or conversion privilege related to the passage of time, the occurrence
of one or more events, or the satisfaction of performance criteria or other conditions. Such awards include, without
limitation, Options, SARs, sales or bonuses of Restricted Stock, Restricted Stock Units, and Dividend Equivalent Rights. An
Award may consist of one such security or benefit, or two (2) or more of them in any combination or alternative.

 

    	 	6	 

     

    

 

(b)    
Designation of Award. Each Award shall be evidenced by an Award Agreement in form and substance satisfactory to the Administrator.
The type of each Award shall be designated in the Award Agreement. In the case of an Option, the Option shall be designated as
either an Incentive Stock Option or a Non-Qualified Stock Option. However, notwithstanding such designation, an Option will qualify
as an Incentive Stock Option under the Code only to the extent the $100,000 dollar limitation of Section 422(d) of the Code is
not exceeded. The $100,000 limitation of Section 422(d) of the Code is calculated based on the aggregate Fair Market Value of
the Shares subject to Options designated as Incentive Stock Options which become exercisable for the first time by a Grantee during
any calendar year (under all plans of the Company or any Related Entity). For purposes of this calculation, Incentive Stock Options
shall be taken into account in the order in which they were granted, and the Fair Market Value of the Shares shall be determined
as of the grant date of the relevant Option. Any Option granted which fails to satisfy the requirements of the Applicable Laws
for treatment as an Incentive Stock Option shall be a Non-Qualified Stock Option.

 

(c)     
Conditions of Award. Subject to the terms of the Plan, the Administrator shall determine the provisions, terms, and conditions
of each Award including, but not limited to, the Award vesting schedule, repurchase provisions, rights of first refusal, forfeiture
provisions, form of payment (cash, Shares, or other consideration) upon settlement of the Award, payment contingencies, and satisfaction
of any performance criteria that may be established by the Administrator.

 

(d)    
Performance-Based Awards. If the Administrator determines at the time an Award is granted to an Employee that the Employee
is, or is likely to be, as of the end of the Company’s tax year in which the Company would claim a tax deduction in connection
with such Award, a Covered Employee, then the Administrator may include in the Award certain provisions so that the Award will
qualify as Performance-Based Compensation. Awards intended to qualify as Performance-Based Compensation will be subject to the
following provisions:

 

(i)      
The Awards will be subject to the achievement of certain performance criteria as the Administrator may determine. The performance
criteria established by the Administrator may be based on any one of, or combination of, the following criteria:

 

(A)    
Net earnings or net income (before or after taxes);

 

(B)    
Earnings per share;

 

(C)    
Net sales growth;

 

(D)    
Net operating profit;

 

(E)    
Return measures (including, but not limited to, return on assets, capital, equity, or sales);

 

(F)    
Cash flow (including, but not limited to, operating cash flow, free cash flow, and cash flow return on capital);

 

(G)    
Cash flow per share;

 

(H)    
Earnings before or after taxes, interest, depreciation, and/or amortization;

 

(I)      
Gross or operating margins;

 

(J)     
Productivity ratios;

 

(K)    
Share price (including, but not limited to, growth measures and total stockholder return);

 

(L)     
Expense targets or ratios;

 

 

    	 	7	 

     

    

(M)   
Charge-off levels;

 

(N)    
Improvement in or attainment of revenue levels;

 

(O)    
Deposit growth;

 

(P)    
Margins;

 

(Q)    
Operating efficiency;

 

(R)    
Operating expenses;

 

(S)    
Economic value added;

 

(T)     
Improvement in or attainment of expense levels;

 

(U)    
Improvement in or attainment of working capital levels;

 

(V)    
Debt reduction;

 

(W)   
Capital targets; and

 

(X)    
Consummation of acquisitions, dispositions, projects or other specific events or transactions.

 

The
Administrator may provide in any grant of an Award that any evaluation of performance may include or exclude any of the following
events that occurs during a Performance Period: (a) asset write-downs, (b) litigation or claim judgments or settlements, (c) the
effect of changes in tax laws, accounting principles or regulations, or other laws or provisions affecting reported results, (d)
any reorganization and restructuring programs, (e) Extraordinary Items for the applicable Performance Period, (f) mergers, acquisitions
or divestitures, and (g) foreign exchange gains and losses. To the extent such inclusions or exclusions affect Awards to Covered
Employees, any such inclusions or exclusions shall be prescribed in the grant in a form that meets the requirements of Code Section
162(m) for deductibility. For this purpose “Extraordinary Items” means extraordinary, unusual, and/or nonrecurring
items of gain or loss as defined under United States generally accepted accounting principles.

 

(ii)     
Before the 90th day of the applicable Performance Period (or, if the Performance Period is less than one year, no later
than the number of days which is equal to 25% of such Performance Period), the Administrator will determine the duration of the
Performance Period, the performance criteria on which performance will be measured, and the amount and terms of payment/vesting
upon achievement of the such criteria.

 

(iii)    
Following the completion of each Performance Period, the Administrator will certify in writing whether the applicable performance
criteria have been achieved for the Awards for such Performance Period. A Grantee will be eligible to receive payment pursuant
to an Award for a Performance Period only if the performance criteria for such Performance Period are achieved. In determining
the amounts earned by a Grantee pursuant to an Award intended to qualify as Performance-Based Compensation, the Administrator
will have the right to (A) reduce or eliminate (but not to increase) the amount payable at a given level of performance to take
into account additional factors that the Administrator may deem relevant to the assessment of individual or corporate performance
for the Performance Period, (B) determine what actual Award, if any, will be paid in the event of a Corporate Transaction or in
the event of a termination of employment following a Corporate Transaction prior to the end of the Performance Period, and (C)
determine what actual Award, if any, will be paid in the event of a termination of employment other than as the result of a Grantee’s
death or Disability prior to a Corporate Transaction and prior to the end of the Performance Period to the extent an actual Award
would have otherwise been achieved had the Grantee remained employed through the end of the Performance Period.

 

(iv)    
Payment of the Award to a Grantee shall be paid following the end of the Performance Period, or if later, the date on which any
applicable contingency or restriction has ended.

 

(v)     
Sections 6(d)(i) though 6(d)(iv) above are not required for an Award of Options or SARs. However, any of those provisions may
be included in an Award of Options or SARs at the discretion of the Administrator.

 

    	 	8	 

     

    

 

(vi)    
To the extent that the Administrator determines as of the date of grant of an Award that (A) the Award is intended to qualify
as Performance-Based Compensation, and (B) the Award is not exempt from the application of Section 162(m) of the Code, such Award
shall not be effective until any stockholder approval required under Section 162(m) of the Code has been obtained.

 

(e)     
Acquisitions and Other Transactions. The Administrator may issue Awards under the Plan in settlement, assumption or substitution
for, outstanding awards or obligations to grant future awards in connection with the Company or a Related Entity acquiring another
entity, an interest in another entity or an additional interest in a Related Entity whether by merger, stock purchase, asset purchase
or other form of transaction.

 

(f)     
Deferral of Award Payment. The Administrator may establish one or more programs under the Plan to permit selected Grantees
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 Grantee to payment or receipt of Shares or other consideration under an
Award. The Administrator 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 Administrator deems advisable for the administration of any such deferral program.

 

(g)    
Separate Programs. The Administrator may establish one or more separate programs under the Plan for the purpose of issuing
particular forms of Awards to one or more classes of Grantees on such terms and conditions as determined by the Administrator
from time to time.

 

(h)     
Individual Award Limit. No Grantee may be granted an Award of Options or SARs in any calendar year with respect to more
than five hundred thousand (500,000) Shares, or an Award of Restricted Stock, Restricted Stock Units, Dividend Equivalent Rights,
or other Awards that are valued with reference to shares covering more than five hundred thousand (500,000) Shares. The foregoing
limitations shall be adjusted proportionately in connection with any change in the Company’s capitalization pursuant to
Section 13 below. To the extent required by Section 162(m) of the Code or the regulations thereunder, in applying the foregoing
limitations with respect to a Grantee, if any Option or SAR is canceled, the canceled Option or SAR shall continue to count against
the maximum number of Shares with respect to which Options and SARs may be granted to the Grantee. For this purpose, the repricing
of an Option (or in the case of an SAR, the base amount on which the stock appreciation is calculated is reduced to reflect a
reduction in the Fair Market Value of the Common Stock) shall be treated as the cancellation of the existing Option or SAR and
the grant of a new Option or SAR.

 

(i)      
Early Exercise. An Award Agreement may, but need not, include a provision whereby the Grantee may elect at any time while
an Employee, Director or Consultant to exercise any part or all of the Award prior to full vesting of the Award. Any unvested
Shares received pursuant to such exercise may be subject to a repurchase right in favor of the Company or a Related Entity or
to any other restriction the Administrator determines to be appropriate.

 

(j)      
Term of Award. The term of each Award shall be the term stated in the Award Agreement, provided, however, that the term
shall be no more than ten (10) years from the date of grant thereof. However, in the case of an Incentive Stock Option granted
to a Grantee who, at the time the Option is granted, owns stock representing more than ten percent (10%) of the voting power of
all classes of stock of the Company or any Related Entity, the term of the Incentive Stock Option shall be five (5) years from
the date of grant thereof or such shorter term as may be provided in the Award Agreement. Notwithstanding the foregoing, the specified
term of any Award shall not include any period for which the Grantee has elected to defer the receipt of the Shares or cash issuable
pursuant to the Award.

 

(k)     
Transferability of Awards. Unless the Administrator provides otherwise, no award may be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during
the lifetime of the Grantee, only by the Grantee. Notwithstanding the foregoing, the Grantee may designate one or more beneficiaries
of the Grantee’s Award in the event of the Grantee’s death on a beneficiary designation form provided by the Administrator.

 

(l)      
Time of Granting Awards. The date of grant of an Award shall for all purposes be the date on which the Administrator makes
the determination to grant such Award, or such other later date as is determined by the Administrator.

 

    	 	9	 

     

    

 

(m)   
Stock Appreciation Rights. An SAR may be granted (i) with respect to any Option granted under this Plan, either concurrently
with the grant of such Option or at such later time as determined by the Administrator (as to all or any portion of the Shares
subject to the Option), or (ii) alone, without reference to any related Option. Each SAR granted by the Administrator under this
Plan shall be subject to the following terms and conditions. Each SAR granted to any participant shall relate to such number of
Shares as shall be determined by the Administrator, subject to adjustment as provided in Section 13. In the case of an SAR granted
with respect to an Option, the number of Shares to which the SAR pertains shall be reduced in the same proportion that the holder
of the Option exercises the related Option. The exercise price of an SAR will be determined by the Administrator at the date of
grant but may not be less than 100% of the Fair Market Value of the Shares subject thereto on the date of grant. Subject to the
right of the Administrator to deliver cash in lieu of Shares (which, as it pertains to Officers and Directors of the Company,
shall comply with all requirements of the Exchange Act), the number of Shares which shall be issuable upon the exercise of an
SAR shall be determined by dividing:

 

(i)      
the number of Shares as to which the SAR is exercised multiplied by the amount of the appreciation in such Shares (for this purpose,
the “appreciation” shall be the amount by which the Fair Market Value of the Shares subject to the SAR on the exercise
date exceeds (1) in the case of an SAR related to an Option, the exercise price of the Shares under the Option or (2) in the case
of an SAR granted alone, without reference to a related Option, an amount which shall be determined by the Administrator at the
time of grant, subject to adjustment under Section 13); by

 

(ii)     
the Fair Market Value of a Share on the exercise date.

 

In
lieu of issuing Shares upon the exercise of an SAR, the Administrator may elect to pay the holder of the SAR cash equal to the
Fair Market Value on the exercise date of any or all of the Shares which would otherwise be issuable. No fractional Shares shall
be issued upon the exercise of an SAR; instead, the holder of the SAR shall be entitled to receive a cash adjustment equal to
the same fraction of the Fair Market Value of a Share on the exercise date or to purchase the portion necessary to make a whole
share at its Fair Market Value on the date of exercise. The exercise of an SAR related to an Option shall be permitted only to
the extent that the Option is exercisable under Section 11 on the date of surrender. Any Incentive Stock Option surrendered pursuant
to the provisions of this Section 6(m) shall be deemed to have been converted into a Non-Qualified Stock Option immediately prior
to such surrender.

 

(n)     
Compliance with Section 409A of the Code.  Notwithstanding anything to the contrary set forth herein, any Award that
is not exempt from the requirements of Section 409A of the Code shall contain such provisions so that such Award will comply with
the requirements of Section 409A of the Code. Such restrictions, if any, shall be determined by the Administrator and contained
in the Award Agreement evidencing such Award.

 

7.      
Award Exercise or Purchase Price, Consideration and Taxes.

 

(a)     
Exercise or Purchase Price. The exercise or purchase price, if any, for an Award shall be as follows.

 

(i)      
In the case of an Incentive Stock Option:

 

(1)     
granted to an Employee who, at the time of the grant of such Incentive Stock Option owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Company or any Related Entity, the per Share exercise price shall be
not less than one hundred ten percent (110%) of the Fair Market Value per Share on the date of grant; or

 

(2)     
granted to any Employee other than an Employee described in the preceding paragraph, the per Share exercise price shall be not
less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant.

 

(ii)     
In the case of a Non-Qualified Stock Option, the per Share exercise price shall be not less than one-hundred percent (100%) of
the Fair Market Value per Share on the date of grant.

 

(iii)    
In the case of Awards intended to qualify as Performance-Based Compensation, the exercise or purchase price, if any, shall be
not less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant.

 

(iv)    
In the case of other Awards, such price as is determined by the Administrator.

 

    	 	10	 

     

    

 

(v)     
Notwithstanding the foregoing provisions of this Section 7(a), in the case of an Award issued pursuant to Section 6(e), above,
the exercise or purchase price for the Award shall be determined in accordance with the provisions of the relevant instrument
evidencing the agreement to issue such Award.

 

(b)    
Consideration. Subject to Applicable Laws, the consideration to be paid for the Shares to be issued upon exercise or purchase
of an Award, including the method of payment, shall be determined by the Administrator. In addition to any other types of consideration
the Administrator may determine, the Administrator is authorized to accept as consideration for Shares issued under the Plan the
following:

 

(i)      
cash;

 

(ii)     
check;

 

(iii)    
delivery of Grantee’s promissory note with such recourse, interest, security, and redemption provisions as the Administrator
determines as appropriate (but only to the extent that the acceptance or terms of the promissory note would not violate an Applicable
Law); provided, however, that interest shall compound at least annually and shall be charged at the minimum rate of interest necessary
to avoid (A) the imputation of interest income to the Company and compensation income to the Grantee under any applicable provisions
of the Code, and (B) the classification of the Award as a liability for financial accounting purposes;

 

(iv)    
surrender of Shares or delivery of a properly executed form of attestation of ownership of Shares as the Administrator may require
which have a Fair Market Value on the date of surrender or attestation equal to the aggregate exercise price of the Shares as
to which said Award shall be exercised;

 

(v)     
with respect to Options, payment through a broker-dealer sale and remittance procedure pursuant to which the Grantee (A) shall
provide written instructions to a broker-dealer acceptable to the Company to effect the immediate sale of some or all of the purchased
Shares and remit to the Company sufficient funds to cover the aggregate exercise price payable for the purchased Shares and (B)
shall provide written directives to the Company to deliver the certificates (or other evidence satisfactory to the Company to
the extent that the Shares are uncertificated) for the purchased Shares directly to such broker-dealer in order to complete the
sale transaction;

 

(vi)    
with respect to Options, payment through a “net exercise” such that, without the payment of any funds, the Grantee
may exercise the Option and receive the net number of Shares equal to (i) the number of Shares as to which the Option is being
exercised, multiplied by (ii) a fraction, the numerator of which is the Fair Market Value per Share (on such date as is determined
by the Administrator) less the Exercise Price per Share, and the denominator of which is such Fair Market Value per Share;

 

(vii)   
past or future services actually or to be rendered to the Company or a Related Entity;

 

(viii)  
any combination of the foregoing methods of payment; or

 

(ix)    
any other method approved by the Administrator.

 

The
Administrator may at any time or from time to time, by adoption of or by amendment to the standard forms of Award Agreement described
in Section 4(c)(iv), or by other means, grant Awards which do not permit all of the foregoing forms of consideration to be used
in payment for the Shares or which otherwise restrict one or more forms of consideration.

 

8.      
Notice to Company of Disqualifying Disposition. Each Employee who receives an Incentive Stock Option must agree to notify
the Company in writing immediately after the Employee makes a Disqualifying Disposition of any Common Stock acquired pursuant
to the exercise of an Incentive Stock Option.

 

9.      
Tax Withholding.

 

(a)     
Prior to the delivery of any Shares or cash pursuant to an Award (or the exercise thereof), or at such other time as the Tax Obligations
are due, the Company, in accordance with the Code and any Applicable Laws, shall have the power and the right to deduct or withhold,
or require a Grantee to remit to the Company, an amount sufficient to satisfy all Tax Obligations. The Administrator may condition
such delivery, payment, or other event pursuant to an Award on the payment by the Grantee of any such Tax Obligations.

 

    	 	11	 

     

    

 

(b)    
The Administrator, pursuant to such procedures as it may specify from time to time, may designate the method or methods by which
a Grantee may satisfy the Tax Obligations. As determined by the Administrator from time to time, these methods may include one
or more of the following:

 

(i)      
paying cash;

 

(ii)     
electing to have the Company withhold cash or Shares deliverable to the Grantee having a Fair Market Value equal to the amount
required to be withheld;

 

(iii)    
delivering to the Company already-owned Shares having a Fair Market Value equal to the minimum amount required to be withheld
or remitted, provided the delivery of such Shares will not result in any adverse accounting consequences as the Administrator
determines;

 

(iv)    
selling a sufficient number of Shares otherwise deliverable to the Grantee through such means as the Administrator may determine
(whether through a broker or otherwise) equal to the Tax Obligations required to be withheld;

 

(v)     
retaining from salary or other amounts payable to the Grantee cash having a sufficient value to satisfy the Tax Obligations; or

 

(vi)    
any other means which the Administrator determines to both comply with Applicable Laws, and to be consistent with the purposes
of the Plan.

 

The
amount of Tax Obligations will be deemed to include any amount that the Administrator determines may be withheld at the time the
election is made, not to exceed the amount determined by using the maximum federal, state, local and foreign marginal income tax
rates applicable to the Grantee or the Company, as applicable, with respect to the Award on the date that the amount of tax or
social insurance liability to be withheld or remitted is to be determined. The Fair Market Value of the Shares to be withheld
or delivered shall be determined as of the date that the Tax Obligations are required to be withheld.

 

10.    
Rights As a Stockholder.

 

(a)     
Restricted Stock. Except as otherwise provided in any Award Agreement, a Grantee will not have any rights of a stockholder
with respect to any of the Shares granted to the Grantee under an Award of Restricted Stock (including the right to vote or receive
dividends and other distributions paid or made with respect thereto) nor shall cash dividends or dividend equivalents accrue or
be paid in respect of any unvested Award of Restricted Stock, unless and until such Shares vest.

 

(b)    
Other Awards. In the case of Awards other than Restricted Stock, except as otherwise provided in any Award Agreement, a
Grantee will not have any rights of a stockholder, nor will dividends or dividend equivalents accrue or be paid, with respect
to any of the Shares granted pursuant to such Award until the Award is exercised or settled and the Shares are delivered (as evidenced
by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company).

 

11.    
Exercise of Award.

 

(a)     
Procedure for Exercise.

 

(i)      
Any Award granted hereunder shall be exercisable at such times and under such conditions as determined by the Administrator under
the terms of the Plan and as specified in the Award Agreement.

 

(ii)     
An Award shall be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with
the terms of the Award by the person entitled to exercise the Award and full payment for the Shares with respect to which the
Award is exercised has been made, including, to the extent selected, use of the broker-dealer sale and remittance procedure to
pay the purchase price as provided in Section 7(b)(v).

 

(b)     Exercise
of Award Following Termination of Continuous Service. In the event of termination of a Grantee’s Continuous Service
for any reason other than Disability or death, such Grantee may, but only during the Post-Termination Exercise Period (but in
no event later than the expiration date of the term of such Award as set forth in the Award Agreement), exercise the
portion of the Grantee’s Award that was vested at the date of such termination or such other portion of the
Grantee’s Award as may be determined by the Administrator. The Grantee’s Award Agreement may provide that upon
the termination of the Grantee’s Continuous Service for Cause, the Grantee’s right to exercise the Award shall
terminate concurrently with the termination of Grantee’s Continuous Service. In the event of a Grantee’s change
of status from Employee to Consultant, an Employee’s Incentive Stock Option shall convert automatically to a
Non-Qualified Stock Option on the day three (3) months and one day following such change of status. To the extent that the
Grantee’s Award was unvested at the date of termination, or if the Grantee does not exercise the vested portion of the
Grantee’s Award within the Post-Termination Exercise Period, the Award shall terminate.

 

    	 	12	 

     

    

 

(c)     
Disability of Grantee. In the event of termination of a Grantee’s Continuous Service as a result of his or her Disability,
such Grantee may, but only within twelve (12) months from the date of such termination (or such longer period as specified in
the Award Agreement but in no event later than the expiration date of the term of such Award as set forth in the Award Agreement),
exercise the portion of the Grantee’s Award that was vested at the date of such termination; provided, however, that if
such Disability is not a “disability” as such term is defined in Section 22(e)(3) of the Code, in the case of an Incentive
Stock Option such Incentive Stock Option shall automatically convert to a Non-Qualified Stock Option on the day three (3) months
and one day following such termination. To the extent that the Grantee’s Award was unvested at the date of termination,
or if Grantee does not exercise the vested portion of the Grantee’s Award within the time specified herein, the Award shall
terminate.

 

(d)    
Death of Grantee. In the event of a termination of the Grantee’s Continuous Service as a result of his or her death,
or in the event of the death of the Grantee during the Post-Termination Exercise Period or during the twelve (12) month period
following the Grantee’s termination of Continuous Service as a result of his or her Disability, the Grantee’s estate
or a person who acquired the right to exercise the Award by bequest or inheritance may exercise the portion of the Grantee’s
Award that was vested as of the date of termination, within twelve (12) months from the date of death (or such longer period as
specified in the Award Agreement but in no event later than the expiration of the term of such Award as set forth in the Award
Agreement). To the extent that, at the time of death, the Grantee’s Award was unvested, or if the Grantee’s estate
or a person who acquired the right to exercise the Award by bequest or inheritance does not exercise the vested portion of the
Grantee’s Award within the time specified herein, the Award shall terminate.

 

(e)     
Extension if Exercise Prevented by Law. Notwithstanding the foregoing, if the exercise of an Award within the applicable
time periods set forth in this Section 11 is prevented by the provisions of Section 12 below, the Award shall remain exercisable
until one (1) month after the date the Grantee is notified by the Company that the Award is exercisable, but in any event no later
than the expiration of the term of such Award as set forth in the Award Agreement.

 

12.    
Conditions Upon Issuance of Shares; Manner of Issuance of Shares.

 

(a)     
If at any time the Administrator determines that the delivery of Shares pursuant to the exercise, vesting or any other provision
of an Award is or may be unlawful under Applicable Laws, the vesting or right to exercise an Award or to otherwise receive Shares
pursuant to the terms of an Award shall be suspended until the Administrator determines that such delivery is lawful and shall
be further subject to the approval of counsel for the Company with respect to such compliance. The Company shall have no obligation
to effect any registration or qualification of the Shares under any Applicable Law.

 

(b)    
As a condition to the exercise of an Award, the Company may require the person exercising such Award to represent and warrant
at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to
sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required by any Applicable
Laws.

 

(c)     
Subject to the Applicable Laws and any governing rules or regulations, the Company shall issue or cause to be issued the Shares
acquired pursuant to an Award and shall deliver such Shares to or for the benefit of the Grantee by means of one or more of the
following as determined by the Administrator: (i) by delivering to the Grantee evidence of book entry Shares credited to the account
of the Grantee, (ii) by depositing such Shares for the benefit of the Grantee with any broker with which the Grantee has an account
relationship, or (iii) by delivering such Shares to the Grantee in certificate form.

 

    	 	13	 

     

    

 

(d)    
No fractional Shares shall be issued pursuant to any Award under the Plan; any Grantee who would otherwise be entitled to receive
a fraction of a Share upon exercise or vesting of an Award will receive from the Company cash in lieu of such fractional Shares
in an amount equal to the Fair Market Value of such fractional Shares, as determined by the Administrator.

 

13.    
Adjustments. Subject to any required action by the stockholders of the Company, the number of Shares covered by each outstanding
Award, and the number of Shares which have been authorized for issuance under the Plan but as to which no Awards have yet been
granted or which have been returned to the Plan, the exercise or purchase price of each such outstanding Award, as well as any
other terms that the Administrator determines require adjustment shall be proportionately adjusted for (i) any increase or decrease
in the number of issued and outstanding Shares resulting from a stock split, reverse stock split, stock dividend, combination
or reclassification of the Shares, or similar transaction affecting the Shares, (ii) any other increase or decrease in the number
of issued and outstanding Shares effected without receipt of consideration by the Company, or (iii) any other transaction with
respect to the Company’s Common Stock including a corporate merger, consolidation, acquisition of property or stock, separation
(including a spin-off or other distribution of stock or property), reorganization, liquidation (whether partial or complete) or
any similar transaction; provided, however that conversion of any convertible securities of the Company shall not be deemed to
have been “effected without receipt of consideration.” Such adjustment shall be made by the Administrator and its
determination shall be final, binding and conclusive. Except as the Administrator determines, no issuance by the Company of shares
of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason
hereof shall be made with respect to, the number or price of Shares subject to an Award. No adjustments shall be made for dividends
paid in cash or in property other than Common Stock of the Company, nor shall cash dividends or dividend equivalents accrue or
be paid in respect of unexercised Options or unvested Awards hereunder.

 

14.    
Corporate Transactions.

 

(a)     
Termination of Award to Extent Not Assumed in Corporate Transaction. Effective upon the consummation of a Corporate Transaction,
all outstanding Awards under the Plan shall terminate. However, all such Awards shall not terminate to the extent they are Assumed
in connection with the Corporate Transaction.

 

(b)    
Acceleration of Award Upon Corporate Transaction. The Administrator shall have the authority, exercisable either in advance
of any actual or anticipated Corporate Transaction or at the time of an actual Corporate Transaction, and exercisable at the time
of the grant of an Award under the Plan or any time while an Award remains outstanding, to provide for the full or partial automatic
vesting and exercisability of one or more outstanding unvested Awards under the Plan and the release from restrictions on transfer
and repurchase or forfeiture rights of such Awards in connection with a Corporate Transaction on such terms and conditions as
the Administrator may specify. The Administrator also shall have the authority to condition any such Award vesting and exercisability
or release from such limitations upon the subsequent termination of the Continuous Service of the Grantee within a specified period
following the effective date of the Corporate Transaction. The Administrator may provide that any Awards so vested or released
from such limitations in connection with a Corporate Transaction shall remain fully exercisable until the expiration or sooner
termination of the Award.

 

(c)     
Effect of Acceleration on Incentive Stock Options. Any Incentive Stock Option accelerated under this Section 14 in connection
with a Corporate Transaction shall remain exercisable as an Incentive Stock Option under the Code only to the extent the $100,000
dollar limitation of Section 422(d) of the Code is not exceeded.

 

15.    
Effective Date and Term of Plan. The Plan shall become effective at such time as it has been (a) approved by the Company’s
stockholders and (b) adopted by the Board. Stockholder approval shall be obtained in the degree and manner required under Applicable
Laws. The Plan shall continue in effect for a term of ten (10) years unless sooner terminated. Any Award granted before stockholder
approval is obtained will be rescinded if stockholder approval is not obtained within the time prescribed, and Shares issued on
the grant or exercise of any such Award shall not be counted in determining whether stockholder approval is obtained. Subject
to the preceding sentence and the Applicable Laws, Awards may be granted under the Plan upon its becoming effective.

 

    	 	14	 

     

    

 

16.    
Amendment, Suspension or Termination of the Plan.

 

(a)     
The Board may at any time amend, suspend or terminate the Plan in any respect, except that it may not, without the approval of
the stockholders obtained within twelve (12) months before or after the Board adopts a resolution authorizing any of the following
actions, do any of the following:

 

(i)      
increase the total number of shares that may be issued under the Plan (except by adjustment pursuant to Section 13);

 

(ii)     
modify the provisions of Section 6 regarding eligibility for grants of Incentive Stock Options;

 

(iii)    
modify the provisions of Section 7(a) regarding the exercise price at which shares may be offered pursuant to Options (except
by adjustment pursuant to Section 13);

 

(iv)    
extend the expiration date of the Plan; and

 

(v)     
except as provided in Section 13 (including, without limitation, any stock dividend, stock split, extraordinary cash dividend,
recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination, or exchange of shares), the Company
may not amend an Award granted under the Plan to reduce its exercise price per share, cancel and regrant new Awards with lower
prices per share than the original prices per share of the cancelled Awards, or cancel any Awards in exchange for cash or the
grant of replacement Awards with an exercise price that is less than the exercise price of the original Awards, essentially having
the effect of a repricing, without approval by the Company’s stockholders.

 

(b)    
No Award may be granted during any suspension of the Plan or after termination of the Plan.

 

(c)     
No suspension or termination of the Plan shall adversely affect any rights under Awards already granted to a Grantee without his
or her consent.

 

17.    
Reservation of Shares.

 

(a)     
The Company, during the term of the Plan, will at all times reserve and keep available such number of Shares as shall be sufficient
to satisfy the requirements of the Plan.

 

(b)    
The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the
Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of
any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been
obtained.

 

18.    
No Effect on Terms of Employment/Consulting Relationship. The Plan shall not confer upon any Grantee any right with respect
to the Grantee’s Continuous Service, nor shall it interfere in any way with his or her right or the right of the Company
or a Related Entity to terminate the Grantee’s Continuous Service at any time, with or without Cause, and with or without
notice. The ability of the Company or any Related Entity to terminate the employment of a Grantee who is employed at will is in
no way affected by its determination that the Grantee’s Continuous Service has been terminated for Cause for the purposes
of this Plan.

 

19.    
No Effect on Retirement and Other Benefit Plans. Except as specifically provided in a retirement or other benefit plan
of the Company or a Related Entity, Awards shall not be deemed compensation for purposes of computing benefits or contributions
under any retirement plan of the Company or a Related Entity, and shall not affect any benefits under any other benefit plan of
any kind or any benefit plan subsequently instituted under which the availability or amount of benefits is related to level of
compensation. The Plan is not a “Retirement Plan” or “Welfare Plan” under the Employee Retirement Income
Security Act of 1974, as amended.

 

20.    
Information to Grantees. The Company shall provide to each Grantee, during the period for which such Grantee has one or
more Awards outstanding, such information as required by Applicable Laws.

 

    	 	15	 

     

    

 

21.    
Electronic Delivery. The Administrator may decide to deliver any documents related to any Award granted under the Plan
through an online or electronic system established and maintained by the Company or another third party designated by the Company
or to request a Grantee’s consent to participate in the Plan by electronic means. By accepting an Award, each Grantee consents
to receive such documents by electronic delivery and agrees to participate in the Plan through an online or electronic system
established and maintained by the Company or another third party designated by the Company, and such consent shall remain in effect
throughout Grantee’s Continuous Service with the Company and any Related Entity and thereafter until withdrawn in writing
by Grantee.

 

22.    
Data Privacy. The Administrator may decide to collect, use and transfer, in electronic or other form, personal data as
described in this Plan or any Award for the exclusive purpose of implementing, administering and managing participation in the
Plan. By accepting an Award, each Grantee acknowledges that the Company holds certain personal information about Grantee, including,
but not limited to, name, home address and telephone number, date of birth, social security number or other identification number,
salary, nationality, job title, details of all Awards awarded, cancelled, exercised, vested or unvested, for the purpose of implementing,
administering and managing the Plan (the “Data”). Each Grantee further acknowledges that Data may be
transferred to any third parties assisting in the implementation, administration and management of the Plan and that these third
parties may be located in jurisdictions that may have different data privacy laws and protections, and Grantee authorizes such
third parties to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing,
administering and managing the Plan, including any requisite transfer of such Data as may be required to a broker or other third
party with whom the recipient or the Company may elect to deposit any Shares acquired upon any Award.

 

23.    
Compliance with Section 409A. To the extent that the Administrator determines that any Award granted hereunder is subject
to Section 409A of the Code, the Award Agreement evidencing such Award shall incorporate the terms and conditions necessary to
avoid the consequences specified in Section 409A(a)(1) of the Code. To the extent applicable, the Plan and Award Agreements shall
be interpreted in accordance with Section 409A of the Code and Department of Treasury regulations and other interpretive guidance
issued thereunder, including without limitation any such regulations or other guidance that may be issued or amended after the
effective date of the Plan. Notwithstanding any provision of the Plan to the contrary, in the event that following the effective
date of the Plan the Administrator determines that any Award may be subject to Section 409A of the Code and related Department
of Treasury guidance (including such Department of Treasury guidance as may be issued after the effective date of the Plan), the
Administrator may adopt such amendments to the Plan and the applicable Award Agreement or adopt other policies and procedures
(including amendments, policies and procedures with retroactive effect), or take any other actions, that the Administrator determines
are necessary or appropriate to (1) exempt the Award from Section 409A of the Code and/or preserve the intended tax treatment
of the benefits provided with respect to the Award, or (2) comply with the requirements of Section 409A of the Code and related
Department of Treasury guidance.

 

24.    
Unfunded Obligation. Grantees shall have the status of general unsecured creditors of the Company. Any amounts payable
to Grantees pursuant to the Plan shall be unfunded and unsecured obligations for all purposes, including, without limitation,
Title I of the Employee Retirement Income Security Act of 1974, as amended. Neither the Company nor any Related Entity shall be
required to segregate any monies from its general funds, or to create any trusts, or establish any special accounts with respect
to such obligations. The Company shall retain at all times beneficial ownership of any investments, including trust investments,
which the Company may make to fulfill its payment obligations hereunder. Any investments or the creation or maintenance of any
trust or any Grantee account shall not create or constitute a trust or fiduciary relationship between the Administrator, the Company
or any Related Entity and a Grantee, or otherwise create any vested or beneficial interest in any Grantee or the Grantee’s
creditors in any assets of the Company or a Related Entity. The Grantees shall have no claim against the Company or any Related
Entity for any changes in the value of any assets that may be invested or reinvested by the Company with respect to the Plan.

 

25.    
Construction. Captions and titles contained herein are for convenience only and shall not affect the meaning or interpretation
of any provision of the Plan. Except when otherwise indicated by the context, the singular shall include the plural and the plural
shall include the singular. Use of the term “or” is not intended to be exclusive, unless the context clearly requires
otherwise.

 

 

16Exhibit 10.1

 

STANDBY GUARANTEE AGREEMENT

 

THIS AGREEMENT made as of the 10th
day of November, 2017.

 

BETWEEN:

 

GOLDEN QUEEN MINING CO.
LTD., a company existing under the laws of the Province of British Columbia

(the
“Company”)

 

AND:

 

Landon
T. Clay 2009 Irrevocable Trust DATED MARCH 6, 2009

 

(the
“Clay 2009 Trust”)

 

AND:

 

THE MASTERS 1, LLC

(the
“Masters 1”)

 

(Masters
1 together with the Clay 2009 Trust are the “Standby Guarantors”)

 

WHEREAS:

 

		A.	The Company intends to carry out an offering of Rights
to the holders of record of its Common Shares in the Qualifying Jurisdictions pursuant to a Prospectus; and

 

		B.	The Standby Guarantors have agreed to act as guarantors
in connection with the Rights Offering on the terms and conditions set forth in this Agreement;

 

NOW THEREFORE, in consideration
of the mutual covenants contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties agree as follows:

 

ARTICLE 1

DEFINITIONS

 

		1.1	Defined Terms

 

In this Agreement, including the
Recitals hereto:

 

Additional Subscription
Privilege has the meaning given in Section 2.2;

 

Basic Subscription Privilege
has the meaning given in Section 2.1;

 

Business Day means
any day, other than a Saturday or a Sunday, upon which banks are open for business in the City of Vancouver, British Columbia;

 

Closing has the meaning
given in Section 8.1;

 

     

    	 	2	 

    

 

Closing Date means
that day which falls two (2) Business Days following the Rights Expiry Date or such earlier date after the Rights Expiry Date as
is practicable and as agreed between the Company and the Standby Guarantors;

 

Closing Time has the meaning
given in Section 8.1 of this Agreement;

 

Commissions means the
provincial and territorial securities commissions or other regulatory authorities in the Filing Jurisdictions;

 

Common Shares means
the common shares in the capital of the Company;

 

Disclosure Record means
all prospectuses, information circulars, annual information forms, financial statements, management's discussion and analysis,
material change reports and other public documents filed by or with respect to the Company with applicable Commissions;

 

EDGAR means the Electronic
Data Gathering, Analysis and Retrieval system (EDGAR);

 

Effective Date has the meaning
given in Section 2.1;

 

Exchange means the Toronto
Stock Exchange;

 

Filing Jurisdictions means
the provinces of British Columbia, Alberta and Ontario (with respect to the filing of the Prospectus) and the United States (with
respect to the filing of a Registration Statement with the SEC);

 

Final Prospectus means
the final short form prospectus to be filed by the Company with the Commissions to qualify the distribution of the Rights, the
Rights Shares and the Standby Shares pursuant to the Rights Offering, as amended by any Prospectus Amendment to the Final Prospectus;

 

Financial Statements means
the Company’s audited consolidated financial statements, the notes thereto and the auditor's report thereon for the years
ended December 31, 2016 and 2015 with the notes thereto;

 

Governmental Entity means
any:

 

		(a)	multinational, federal, provincial, state, territorial, municipal, local
or other governmental or public department, central bank, court, commission, board, bureau, agency or instrumentality, domestic
or foreign;

 

		(b)	any subdivision or authority of any of the foregoing; or

 

		(c)	any quasi-governmental or private body exercising a regulatory, expropriation
or taxing authority under or for the account of any of the above;

 

Indemnified Party has the
meaning given in section 10.2(a) of this Agreement;

 

Indemnifying Party has the
meaning given in section 10.2(a) of this Agreement;

 

     

    	 	3	 

    

 

Laws means any and
all applicable laws including all statutes, codes, ordinances, decrees, rules, regulations, municipal by-laws, judicial or arbitral
or administrative or ministerial or departmental or regulatory judgments, orders, decisions, rulings or awards, instruments, policies,
guidelines, and general principles of common law and equity, binding on or affecting the Person referred to;

 

Material Adverse Change
means any change, development, event or occurrence with respect to the business, condition (financial or otherwise), properties,
assets, liabilities (contingent or otherwise), capital, cash flow, operations, or results of operations of the Company and its
subsidiaries on a consolidated basis, that is, or would reasonably be expected to be, material and adverse to the Company and its
subsidiaries on a consolidated basis;

 

Material Change has the
meaning given in the Securities Act;

 

Misrepresentation means:

 

		(a)	a “misrepresentation” as defined in Section 1(1) of the Securities Act; or

 

		(b)	as to any document, any untrue statement of a material fact or omission to
state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;

 

NI 41-101 means National
Instrument 41-101 – General Prospectus Requirements of the Canadian Securities Administrators;

 

Non-Qualifying Jurisdiction
means any jurisdiction other than the Qualifying Jurisdictions;

 

Offering Date has the meaning
given in Section 2.1;

 

Order means any award,
decision, injunction, judgment, order, ruling, subpoena, or verdict entered, issued, made, or rendered by any court, administrative
agency, or other Governmental Entity or by any arbitrator;

 

Person means an individual,
corporation, partnership, limited partnership, limited liability partnership, limited liability company, association, trust, estate,
custodian, trustee, executor, administrator, nominee or other entity or organization, including (without limitation) a Governmental
Entity or political subdivision or an agency or instrumentality thereof;

 

Preliminary Prospectus
means the preliminary short form prospectus to be filed with the Commissions to qualify the distribution of the Rights, the Rights
Shares and the Standby Shares issuable upon exercise of the Rights pursuant to the Rights Offering;

 

Prospectus means, collectively,
the Preliminary Prospectus, the Final Prospectus and any Prospectus Amendment;

 

Prospectus Amendment means
any amendment to the Preliminary Prospectus or the Final Prospectus;

 

     

    	 	4	 

    

 

Qualifying Jurisdictions means the Filing Jurisdictions,
except for the States of Arizona, Arkansas, California, Minnesota, Ohio and Wisconsin and such other jurisdictions outside Canada
and the United States where it is lawful to mail the Final Prospectus and Registration Statement, as applicable, and the certificates
representing the Rights to Shareholders resident therein;

 

Record Date means the
record date for the purpose of the Rights Offering that will be established by the Company in accordance with Securities Laws and
set out in the Final Prospectus;

 

Regulatory Authorities means
the Commissions, the SEC and the Exchange;

 

Registration Rights Agreement
has the meaning given in Section 3.4 of this Agreement;

 

Registration Statement means
a registration statement of the Company on Form S-3 or such other form as may be available to the Company at the time of filing
to cover the issuance of Common Shares upon exercise of the Rights under the U.S. Securities Act;

 

Rights means the transferable
rights that will be distributed to each Shareholder on the Record Date to subscribe for Rights Shares at the Subscription Price
under the Rights Offering;

 

Rights Expiry Date has the
meaning given in section 2.1 of this Agreement;

 

Rights Expiry Time means
5:00 p.m. (Vancouver time) on the Rights Expiry Date;

 

Rights Offering means the offering by the Company
of the Rights undertaken in accordance with Article 2;

 

Rights Shares means the
Common Shares which may be issued on exercise of the Rights;

 

SEC means the United
States Securities and Exchange Commission or any successor agency thereto;

 

Securities means the
Rights, the Rights Shares, and the Standby Shares;

 

Securities Act means
the Securities Act (British Columbia);

 

Securities Laws means
all applicable securities Laws of each of the Qualifying Jurisdictions, the U.S. Securities Act and the applicable rules of the
Exchange;

 

SEDAR means the System
for Electronic Document Analysis and Retrieval (SEDAR) as further described in National Instrument 13-101 – System for
Electronic Document Analysis and Retrieval (SEDAR) of the Canadian Securities Administrators;

 

Shareholder means a
holder of record of Common Shares of the Company;

 

Standby Guarantee has
the meaning given in Section 3.1 of this Agreement;

 

Standby Guarantors has
the meaning given on the cover page of this Agreement;

 

     

    	 	5	 

    

 

Standby Purchaser Fee has
the meaning given in Section 3.5 of this Agreement;

 

Standby Shares means
100% of the Rights Shares which remain unsubscribed for by holders of Rights on the Rights Expiry Date under the Rights Offering;

 

Subscription Price has the
meaning given in Section 2.1;

 

U.S. Securities Act means
the United States Securities Act of 1933, as amended; and

 

United States means the
United States of America, its territories and possessions, each State of the United States and the District of Columbia.

 

		1.2	Headings, etc.

 

The division of this Agreement
into articles, sections, paragraphs and clauses and the provision of headings are for the convenience of reference only and will
not affect the construction or interpretation of this Agreement. The terms “this Agreement”, “hereunder”
and similar expressions refer to this Agreement as a whole and not to any particular article, section, paragraph, clause or other
portion of this Agreement and include any agreement or instrument supplemental or ancillary to this Agreement. Unless something
in the subject matter or context is inconsistent therewith, references in this Agreement to articles, sections, paragraphs or clauses
are to articles, sections, paragraphs or clauses of this Agreement.

 

		1.3	Plurality and Gender

 

Words importing the singular
number only will include the plural and vice versa, words importing any gender will include all genders.

 

		1.4	Currency

 

Unless otherwise specifically
stated, all references to dollars and cents in this Agreement are to the lawful currency of the United States.

 

		1.5	Governing Law

 

This Agreement will be governed
by, interpreted and enforced in accordance with the laws of the Province of British Columbia and the federal laws of Canada applicable
therein. Each party hereby unconditionally and irrevocably submits to the nonexclusive jurisdiction of the courts of the Province
of British Columbia in respect of all matters arising out of this Agreement.

 

		1.6	Severability

 

If any provision of this Agreement
is determined to be invalid or unenforceable in whole or in part, such invalidity or unenforceability will attach only to such
provision or part thereof and the remaining part of such provision and all other provisions of this Agreement will continue in
full force and effect. The parties to this Agreement agree to negotiate in good faith a substitute provision which will be as close
as possible to the intention of any invalid or unenforceable provision as may be valid or enforceable. The invalidity or unenforceability
of any provision in any particular jurisdiction will not affect its validity or enforceability in any other jurisdiction where
it is valid or enforceable.

 

     

    	 	6	 

    

 

		1.7	Statutes

 

Any reference to a statute,
act or law will include and will be deemed to be a reference to such statute, act or law and to the regulations, instruments and
policies made pursuant thereto, with all amendments made thereto and in force from time to time, and to any statute, act or law
that may be passed which has the effect of supplementing or superseding such statute, act or law so referred to.

 

ARTICLE 2

CONDUCT OF THE
RIGHTS OFFERING

 

		2.1	Terms of Rights Offering

 

Pursuant to the Rights Offering,
the Company will issue on a pro rata basis at no charge, Rights to each Shareholder resident in the Qualifying Jurisdictions as
of the Record Date on the basis of one (1) Right for each Common Share held. One (1) Right will entitle the holder to purchase,
at the election of such holder, that number of Common Shares equal to the quotient of the Rights Shares divided by 111,148,683
(the “Basic Subscription Privilege”) at a price per Rights Share equal to 75% of the market price of the Common
Shares determined in accordance with Exchange rules (the “Subscription Price”). The Rights Offering will remain
open for a period of 30 calendar days following the date that the SEC declares the Registration Statement effective under the U.S.
Securities Act (the “Effective Date”), subject to a maximum exercise period of 90 days from the issuance date
of the Rights (the “Rights Expiry Date”), provided that if the Effective Date does not occur at least 21 days
prior to 90 days from the issuance date of the Rights, then the Rights Expiry Date will be the Effective Date. Each such Right
will be non-transferable and non-exchangeable, and may not be exercised to acquire Rights Shares, prior to and including the Effective
Date, and will thereafter be transferable, exchangeable and exercisable to acquire Rights Shares up to and including the Rights
Expiry Date.

 

		2.2	Additional Subscription Privilege

 

Pursuant to Securities
Laws, each holder of Rights who has exercised in full the Basic Subscription Privilege attaching to such holder’s Rights,
will be entitled, on a pro rata basis (based on the number of Rights which it exercised under the Basic Subscription Privilege
as a proportion of all Rights exercised under the Basic Subscription Privilege), to subscribe for additional Rights Shares at the
Subscription Price, to the extent that other holders of Rights do not exercise all of their Rights under the Basic Subscription
Privilege (the “Additional Subscription Privilege”)

 

		2.3	Closing

 

The completion of the purchase
of Rights Shares pursuant to the Basic Subscription Privilege and the Additional Subscription Privilege by each Rights holder will
occur at the time, and in the manner set forth in the Final Prospectus, and in the event of any conflict between the provisions
of this Agreement and the provisions of the Final Prospectus, the provisions of the Final Prospectus will prevail.

 

     

    	 	7	 

    

  

ARTICLE 3

STANDBY GUARANTEE

 

		3.1	Standby Guarantee

 

In
order to guarantee that at least US$25,000,000 worth of Rights are exercised on the Closing Date, each of the Standby Guarantors
will purchase, at the Subscription Price, the proportionate share of the Standby Shares up to the maximum amounts set forth below
within two Business Days after the Rights Expiry Date (the “Standby Guarantee”):

 

	
        Standby

        Guarantor
	Dollar Value	Proportionate %
	Clay 2009 Trust	US$18,750,000	75%
	Masters 1	US$6,250,000	25%
	Total:	US$25,000,000	100%

 

The obligations
of the Standby Guarantors pursuant to this Section 3.1 will be several (as distinguished from joint and joint and several) obligations
of each Standby Guarantor, and will terminate upon the termination of this Agreement for any reason. In the event that a Standby
Guarantor either defaults on its obligation pursuant to this Section 3.1 or terminates its obligations under this Agreement pursuant
to Section 9.2, the Company cannot obligate the other Standby Guarantors to exercise the Standby Guarantee of the defaulting or
terminating Standby Guarantor and no Standby Guarantor will be liable to the Company with respect to a default by another Standby
Guarantor. If one or more of the Standby Guarantors fails to purchase its or their proportionate share of the Standby Shares at
the Closing Time the other Standby Guarantor(s) will have the right, but will not be obligated, to purchase on a pro-rata basis
(or in such other proportion as the remaining Standby Guarantors may mutually agree) all, but not less than all, of the Standby
Shares not purchased by the defaulting Standby Guarantor(s).

 

		3.2	Payment for Standby Shares

 

Subject to and in accordance
with the terms of this Agreement, on the Closing Date, each of the Standby Guarantors will pay in immediately available funds by
wire transfer to an account designated by the Company, or by certified cheque payable to the Company or its counsel, the aggregate
Subscription Price that is payable for the Standby Shares to be purchased by such Standby Guarantor hereunder, and the Company
will issue the Standby Shares to such Standby Guarantor and deliver the certificate(s) representing the Standby Shares as soon
as practicable thereafter, but in any event within two Business Days following the Closing Date.

 

		3.3	Evidence of Financial Ability

 

Each of the Standby Guarantors
will provide to the Company such evidence as may be required by the applicable Regulatory Authorities that the Guarantor has the
financial ability to carry out the “stand-by commitment” (as defined under NI 41-101) constituted by this Agreement,
as required under Part 8A of NI 41-101.

 

     

    	 	8	 

    

 

		3.4	Restrictions on Sale

 

Subject to the terms of the
Amended and Restated Registration Rights Agreement dated June 8, 2015 between the 2009 Trust, EHT, LLC, Harris Clay, The Clay Family
2009 Irrevocable Trust Dated April 14, 2009 and the Company (as may be subsequently amended, modified or supplemented, the “Registration
Rights Agreement”), each of the Standby Guarantors agrees to sell the Standby Shares only in accordance with all applicable
Securities Laws, and not to sell or distribute, directly or indirectly, the Standby Shares in such a manner as to:

 

		(a)	require registration by the Company of the Standby Shares or the filing
by the Company of a prospectus or any similar document in any jurisdiction other than as contemplated herein; or

 

		(b)	result in the Company becoming subject to reporting or disclosure obligations
to which it is not subject as at the date of this Agreement.

 

		3.5	Standby Purchaser Fee

 

In consideration for the
Standby Guarantee, the Company has agreed to pay at the Closing to the Standby Guarantors, in immediately available funds by wire
transfer to one or more accounts designated by the Standby Guarantors, a fee (the “Standby Purchaser Fee”) equal
to 3.0% of the aggregate Subscription Price for the maximum number of Rights Shares that would be issued pursuant to the Rights
Offering if all of the Rights were exercised, less that number of Rights which are issued in respect of Common Shares: (a) owned
by the Standby Guarantors; and (b) directly or indirectly owned or over which investment control is exercised by Thomas M. Clay
or Jonathan C. Clay (the shareholders thereof being collectively referred to as the “Excluded Shareholders”).

 

The Stand-by Fee will be
paid to each of the Standby Guarantors in the same proportion as the percentage of the Standby Guarantee for which each is responsible,
as set forth in Section 3.1

 

		3.6	Registration Rights

 

The Company agrees to amend
the Registration Rights Agreement on or before the Closing Time to cover (i) the warrants (and the securities issuable thereunder)
issued pursuant to the Second Amended and Restated Term Loan Agreement dated as of November 21, 2016, by and among the Company
and the other parties thereto, and (ii) the Rights Shares acquired in the Rights Offering by the Standby Guarantors and their affiliates,
and (iii) the Standby Shares acquired in this Rights Offering by the Standby Guarantors and their affiliates.

 

		3.7	Exercise of Rights

 

The
Standby Guarantors each represent and warrant that they intend (but are not legally obligated) to exercise in full their Rights
prior to the Rights Expiry Time.

 

     

    	 	9	 

    

 

ARTICLE 4

COVENANTS

 

		4.1	Covenants of the Company

 

Subject to and in accordance with the terms of
this Agreement, the Company agrees with the Standby Guarantors that:

 

		(a)	Preliminary Prospectus. The Company will use commercially reasonable
efforts to prepare and file the Preliminary Prospectus with the applicable Regulatory Authorities as soon as reasonably practicable
following the date of this Agreement.

 

		(b)	Final Prospectus and Qualification. The Company will use commercially
reasonable efforts prepare and file the Final Prospectus with the applicable Regulatory Authorities, and take all other steps and
proceedings that may be necessary in order to qualify the distribution of the Rights, the Rights Shares issuable upon exercise
of the Rights in each of the Qualifying Jurisdictions in which the Final Prospectus has been filed.

 

		(c)	Registration Statement. The Company will use commercially reasonable
efforts to prepare and file the Registration Statement with the SEC to register the distribution of the Rights Shares upon exercise
of the Rights under the U.S. Securities Act.

 

		(d)	Standby Shares Exemption. The Company will use commercially reasonable
efforts to take all steps and proceedings that may be necessary in order to exempt the distribution of the Standby Shares in the
applicable U.S. jurisdictions where such Standby Shares will be distributed.

 

		(e)	Receipts. The Company will use commercially reasonable efforts to
obtain a receipt (or analogous decision document) as soon as possible following the filing of each of the Preliminary Prospectus
and Final Prospectus with the Commissions.

 

		(f)	Supplementary Material. If required by Securities Laws, the Company
will prepare any Prospectus Amendment or any other document required to be filed by it under the Securities Laws. The Company will
also promptly, and in any event within any applicable time limitation, comply with all applicable filing and other requirements
under the Securities Laws as a result of any Material Change.

 

		(g)	Changes to Terms. The Company will not amend the terms of the Rights
Offering, including for greater certainty any change to the Subscription Price, without the written consent of the Standby Guarantors,
which consent will not be unreasonably withheld or delayed.

 

		(h)	Consents and Approvals. The Company will use its best efforts to obtain
all necessary consents, approvals or exemptions in the Qualifying Jurisdictions for the creation, offering and issuance of the
Securities, and the entering into and performance by it of this Agreement.

 

		(i)	Cease Trade Order or Other Investigation. From the date of this Agreement
to the earlier of: (i) the Closing Date; and (ii) the termination of this Agreement, the Company will immediately notify the Standby
Guarantors in writing of any written demand, request or inquiry (formal or informal) by any Commission, the Exchange or other Governmental
Entity that concerns any matter relating to the Company's affairs that may affect the Rights Offering or the transactions contemplated
in this Agreement, or that relates to the issuance, or threatened issuance, by any such authority of any cease trading or similar
order or ruling relating to any of the Company's securities. Any notice delivered to the Standby Guarantors as aforesaid will contain
reasonable details of the demand, request, inquiry, order or ruling in question. The Company will use its best efforts to prevent
the issuance of any orders contemplated by this Section 4.1(i) and, if issued, to obtain their prompt withdrawal.

 

     

    	 	10	 

    

 

		(j)	Exchange Acceptance. The Company will take all action as may be necessary
and appropriate to obtain conditional acceptance by the Exchange of the issuance of the Rights, the Rights Shares, the Standby
Shares, the Standby Guarantee and the Standby Purchase Fee, subject to receipt of customary final documentation.

 

		(k)	Securities Laws. The Company will take all action as may be necessary
and appropriate so that the Rights Offering and the transactions contemplated in this Agreement will be effected in accordance
with Securities Laws. The Company will not file the Preliminary Prospectus, the Final Prospectus, the Registration Statement or
any Prospectus Amendment without first providing a copy of such documents to the Standby Guarantors and their advisors who will
have a reasonable period of time to review and comment on such documents.

 

		(l)	Obtaining of Report. The Company will cause Computershare Investor
Services Inc. to deliver to the Standby Guarantors, as soon as is practicable following the Rights Expiry Time, details concerning
the total number of Rights Shares duly subscribed and paid for by holders of Rights under the Rights Offering, including (without
limitation) those subscribed and paid for pursuant to the Additional Subscription Privilege.

 

		(m)	No Issuance of Securities. Other than pursuant to the Rights Offering
and the grant and exercise of stock options, during the period from the date hereof until the Closing Date, the Company will not
issue any Common Shares or securities convertible or exchangeable or exercisable into Common Shares.

 

		(n)	Mailing of Materials. The Company will complete the mailing of commercial
copies of the Final Prospectus to each of the Shareholders as of the Record Date in the Qualifying Jurisdictions as soon as possible
following the Record Date. With respect to Shareholders not residents of the Qualifying Jurisdictions, the Company may mail commercial
copies of the Final Prospectus to such Shareholders so long as such Shareholders satisfy to the Company that such receipt of the
Final Prospectus is lawful and in compliance with the Securities Laws and other laws applicable in the Qualifying Jurisdictions
and the jurisdiction where such Shareholder is resident.

 

		(o)	Exercise of the Rights. The Company will use such commercially reasonable
efforts as the Standby Guarantors may reasonably request to enforce payment in respect of, or to otherwise ensure the valid exercise
of, all Rights purported to be exercised either under the Basic Subscription Privilege or the Additional Subscription Privilege.

 

     

    	 	11	 

    

 

ARTICLE 5

MATERIAL CHANGES

 

		5.1	Material Changes During Distribution

 

		(a)	During the period from the date of this Agreement to the Closing Date, the
Company will promptly notify the Standby Guarantors in writing of any Material Change (actual, anticipated, contemplated or threatened,
financial or otherwise) in the business, affairs, operations, assets, liabilities (contingent or otherwise) or capital of the Company
and its subsidiaries taken as a whole.

 

		(b)	During the period from the date of this Agreement to the Closing Date, the
Company will promptly notify the Standby Guarantors in writing of:

 

		(i)	any material fact that has arisen or been discovered and that would be required
to be disclosed in the Prospectus or Registration Statement filed on such date; and

 

		(ii)	any change in any material fact contained in the Prospectus or Registration
Statement, including (without limitation) all documents incorporated by reference, which fact or change is, or may be, of such
a nature as to result in a Misrepresentation in the Prospectus or Registration Statement or that would result in the Prospectus
or Registration Statement not complying with applicable Securities Laws.

 

		(c)	The Company will promptly, and in any event within any applicable time limitation,
comply, to the satisfaction of the Standby Guarantors, acting reasonably, with all applicable filings and other requirements under
the Securities Laws as a result of such material fact or Material Change. The Company will in good faith discuss with the Standby
Guarantors any fact or change in circumstances (actual, anticipated, contemplated or threatened, financial or otherwise) that is
of such a nature that there is reasonable doubt whether written notice need be given under this Section 5.1

 

		5.2	Change in Securities Laws

 

If, prior to the Rights Expiry
Date, there is any change in the Securities Laws that, in the opinion of the Standby Guarantors, acting reasonably, requires the
filing of a Prospectus Amendment, the Company will, to the satisfaction of the Standby Guarantors, acting reasonably, promptly
prepare and file such Prospectus Amendment with the applicable Regulatory Authorities.

 

     

    	 	12	 

    

 

		5.3	Change in Closing Date

 

If a Material Change occurs
after the date of filing of the Final Prospectus with the applicable Regulatory Authorities and prior to the Closing Date, then,
subject to Article 8, the Closing Date will be, unless the Company and the Standby Guarantors otherwise agree in writing, the later
of the previously scheduled Closing Date and the sixth Business Day following the date on which all applicable filings or other
requirements of the Securities Laws with respect to such Material Change have been complied with in all Qualifying Jurisdictions
and any appropriate documents obtained for such filings and notice of such filings from the Company or the Company's counsel have
been received by the Guarantors. For greater certainty, under no circumstances will the exercise period for the Rights Offering
exceed ninety (90) days.

 

ARTICLE 6

WARRANTIES AND
REPRESENTATIONS OF THE COMPANY

 

		6.1	Representations

 

The Company warrants and represents
to each of the Standby Guarantors that:

 

		(a)	it and its subsidiaries have been duly incorporated and organized and are
validly existing and in good standing under the Laws of their respective corporate jurisdictions;

 

		(b)	it has not commenced, participated or agreed to commence or participate in
any bankruptcy, involuntary liquidation, dissolution, winding up, insolvency or similar proceeding and no such proceedings have
been threatened by any other party;

 

		(c)	it has all requisite corporate power to enter into and perform this Agreement,
to own or lease its property and to carry on the part of the business as now being conducted by it;

 

		(d)	no order ceasing or suspending the trading of the Common Shares has been
issued to or is outstanding against the Company;

 

		(e)	the Rights will, when issued, be duly authorized and validly issued securities
of the Company, enforceable against the Company in accordance with their terms;

 

		(f)	the Rights Shares issuable upon the exercise of the Rights will, when issued,
be duly authorized, validly issued, fully paid and non-assessable Common Shares in the capital of the Company;

 

		(g)	the Standby Shares will, when issued, be duly authorized, validly issued,
fully paid and non-assessable Common Shares in the capital of the Company;

 

		(h)	prior to such time as they are issued, all necessary documents will have
been filed and other necessary steps taken to permit the distribution of the Rights and the Common Shares issuable upon the exercise
of the Rights under the securities laws of each province of Canada, and to register the Common Shares issuable upon the exercise
of the Rights under the U.S. Securities Act;

 

     

    	 	13	 

    

 

		(i)	the authorized capital of the Company consists of an unlimited number of
Common Shares, of which 111,148,680 Common Shares have been duly issued and are outstanding as fully paid and non-assessable as
of the date hereof. No Person has any agreement or option or any right or privilege (whether by law, preemptive or contractual)
capable of becoming an agreement or option for the purchase from the Company of any Common Shares or other securities of the Company,
other than pursuant to the Standby Guarantee or stock options (outstanding and which may be granted under the Company’s incentive
stock option plan);

 

		(j)	the execution, delivery and performance by the Company of this Agreement:

 

		(i)	has been duly authorized by all necessary corporate action on its part;

 

		(ii)	does not and will not, with the giving of notice, the lapse of time or the happening of any other
event or condition:

 

		(A)	violate or conflict with any of the terms, conditions or provisions of the
Company’s constating documents or resolutions of the Shareholders, directors or any committee of directors of the Company
or any of its subsidiaries;

 

		(B)	except for the required filings, acceptances or approvals of the Exchange
or as required by Securities Laws with respect to the filing of the Prospectus in respect of the transactions contemplated hereby,
require any authorization, consent, approval, exemption or other action by, or notice to, any stock exchange, governmental agency,
authority, regulatory body or court;

 

		(C)	violate or conflict with, or constitute a default under any material indenture,
mortgage, agreement, contract or other material instrument to which the Company or any of its subsidiaries is a party or by which
any of them or any of their assets or properties may be bound or affected;

 

		(D)	trigger any change of control or similar provision in any material indenture,
mortgage, agreement, contract or other material instrument to which the Company or any of its subsidiaries is a party or by which
any of them or any of their assets or properties may be bound or affected;

 

		(E)	result in the termination of, or any additional payment under, or the change
in any terms of, or accelerate the performance of any obligation required by (or give rise to a right of any party thereto, exercisable
on notice or otherwise, to terminate, to require that any additional payment be made under, to change any terms of, or to accelerate
the performance of any obligation under) any material indenture, mortgage, agreement, contract or other material instrument to
which the Company or any of its subsidiaries is a party or by which any of them or any of their assets or properties may be bound
or affected, except as disclosed in the Disclosure Record;

 

     

    	 	14	 

    

 

		(F)	result in the creation of any encumbrance upon any of the property or assets
of the Company or any of its subsidiaries; or

 

		(G)	violate or conflict with any material license, permit, approval, consent,
certificate, registration or authorization held by the Company or any of its subsidiaries and necessary to carry on the Company’s
business or to own or lease any of the material property of or assets utilized by the Company and its subsidiaries;

 

		(iii)	does not and will not result in the violation of any applicable Laws or any
judgment, decree, order or award of any court, governmental body or arbitrator having jurisdiction over the Company or any of its
subsidiaries;

 

		(k)	this Agreement has been duly executed and delivered by the Company and constitutes
a legal, valid and binding obligation of the Company, enforceable against it in accordance with its terms;

 

		(l)	the Company is a reporting issuer in British Columbia, Alberta, Ontario
and Quebec and is in compliance in all material respects with all applicable, and is not in default of any, requirements of applicable
Securities Laws. Since January 1, 2017, the Company has not received any correspondence or notice from a Commission, the Exchange
or similar Regulatory Authority concerning a review of its Disclosure Record. The Company has not filed any material change report
with any Commission or similar Regulatory Authority on a confidential basis. The Common Shares are listed on the Exchange and the
Company is in compliance in all material respects with all applicable rules of the Exchange. Since January 1, 2017, all documents
required to be filed under applicable Securities Laws have been filed and conform in all material respects to the requirements
of the applicable Securities Laws. Such documents at the time of filing thereof: (a) were true and correct in all material respects;
and (b) did not contain any Misrepresentations. There has been no material change as defined in the Securities Act to the matters
set forth in the Disclosure Record that has not been publicly disclosed;

 

		(m)	the Financial Statements:

 

		(i)	comply in all material respects with applicable Securities Laws;

 

		(ii)	have been prepared in accordance with accounting principles generally accepted
in the United States as in effect from time to time, consistently applied (except as may be indicated in the notes thereto); and

 

		(iii)	fairly present, in all material respects, the consolidated financial position
of the Company and its subsidiaries as at the respective dates thereof and the consolidated results of operations and cash flows
for the periods indicated;

 

     

    	 	15	 

    

 

		(n)	other than as set forth in the Financial Statements, the Company has no
material debt or liability of any kind whatsoever (whether accrued, contingent, absolute or otherwise) except for debt or liabilities
incurred in the ordinary course of business;

 

		(o)	since January 1, 2017, there has not been any reportable event (within the
meaning of National Instrument 51-102 - Continuous Disclosure Obligations) with the present or any former auditor of the
Company;

 

		(p)	each of the Company and its subsidiaries is, in all material respects, conducting
its business in compliance with all applicable Laws of each jurisdiction in which its respective business is carried on and each
is licensed, registered or qualified in all jurisdictions in which it owns, leases or operates its property or carries on business
to enable its business to be carried on as now conducted and its property and assets to be owned, leased and operated and all such
licences, registrations and qualifications are valid, subsisting and in good standing and it has not received a notice of non-compliance,
nor does it have knowledge of any facts that could give rise to a notice of material non-compliance with any such laws, rules,
regulations, licences, registrations or qualifications;

 

		(q)	there is no court, administrative, regulatory or similar proceeding (whether
civil, quasi-criminal or criminal); arbitration or other dispute settlement procedure; investigation or inquiry by any governmental
authority; or any similar matter or proceeding (collectively “proceedings”) pending or, to the knowledge of
the Company, threatened against or involving the Company or any of its subsidiaries (whether in progress or, to the Company’s
knowledge, threatened) which, if determined adversely to the Company, would have a material adverse effect on the Company and its
subsidiaries, taken as a whole, or the Company’s business or would prevent or significantly impede the issue of the Rights
and the Rights Shares issued upon the exercise thereof. The Company has received no notice of, and has no knowledge of, any event
that has occurred which might give rise to any proceedings except as disclosed in the Disclosure Record and there is no judgment,
decree, injunction, ruling, award or order of any Governmental Entity to which the Company or any of its subsidiaries is subject;

 

		(r)	the Company and its subsidiaries are the legal and beneficial owners of the
properties and assets or the interests in properties and assets referred to as owned by them in the Disclosure Record and are free
and clear of all encumbrances, other than as disclosed in the Disclosure Record. All agreements under which the Company (or the
applicable subsidiary) holds an interest in a property or asset are in good standing in all material respects;

 

		(s)	other than as disclosed in the Disclosure Record:

 

		(i)	there has not been any Material Change in the assets, liabilities, obligations
(absolute, accrued, contingent or otherwise), business, condition (financial or otherwise) or results of operations of the Company
and its subsidiaries, on a consolidated basis;

 

     

    	 	16	 

    

 

		(ii)	the Company and its subsidiaries have carried on their respective businesses
in the ordinary course; and

 

		(iii)	no Material Adverse Change has occurred;

 

		(t)	neither the Company nor any of its subsidiaries has received any notice of
or is in default or violation of any Order of any Governmental Entity or any applicable Laws which would reasonably be expected
to have a Material Adverse Effect on the Company;

 

		(u)	there are no outstanding Orders against the Company or its subsidiaries
or to which the Company or its subsidiaries are subject or by which their assets are bound and, other than proceedings described
in all material respects in the Disclosure Record which have been publicly filed by the Issuer on SEDAR or EDGAR as of the date
hereof, there are no claims, proceedings, actions or lawsuits in existence, or to Company’s knowledge, threatened or asserted
against the Company or its subsidiaries or with respect to any of the assets of the Company or its subsidiaries or the interests
of the Company or its subsidiaries therein which would reasonably be expected to have a Material Adverse Effect on the Company
or to have material and adverse effect on the Rights Offering or the other transactions contemplated herein;

 

		(v)	there are no contracts which are material to the business and affairs of
Company or its subsidiaries other than as disclosed in the Disclosure Record which have been publicly filed by the Company on SEDAR
or EDGAR as of the date hereof or which have been entered into in the ordinary course of business, and, other than disclosed in
the Disclosure Record which have been publicly filed by the Company on SEDAR or EDGAR as of the date hereof, all such contracts
are in full force and effect. All such contracts are valid, binding and subsisting and have not been amended or modified and the
terms thereof have not been waived, amended or modified except as disclosed in the Disclosure Record which have been publicly filed
by the Company on SEDAR or EDGAR as the date hereof or except in the ordinary course of business. To the knowledge of the Company,
neither it nor any of its subsidiaries is, nor is alleged to be (with or without the lapse of time or the giving of notice, or
both), in breach or default in any material respect of any such contract, and, to the knowledge of the Company, no other party
to any such contract is (with or without the lapse of time or the giving of notice or both) in breach or default in any material
respect thereunder;

 

		(w)	the Company has not conducted any “general solicitation” or “general
advertising” (as such terms are defined in Regulation D under the U.S. Securities Act) in connection with the offer and sale
of the Standby Shares, including, without limitation, advertisements, articles, notices or other communications published on the
internet or in any newspaper, magazine or similar media, or broadcast over radio, television or the internet, or any seminar or
meeting whose attendees have been invited by general solicitation or general advertising or has made or will make offers and sales
of the Standby Shares in the United States in any manner involving a public offering within the meaning of Section 4(a)(2) of the
U.S. Securities Act;

 

     

    	 	17	 

    

 

		(x)	the Company has not taken and will not take any action that would cause the
exemption from registration provided by Section 4(a)(2) of the U.S. Securities Act to be unavailable with respect to offers and
sales of the Standby Shares pursuant to this Agreement; and

 

		(y)	the Company has not sold, offered for sale or solicited any offer to buy,
and will not sell, offer for sale or solicit any offer to buy, any of its securities in the United States in a manner that would
be integrated with the offer and sale of the Standby Shares and would cause the exemption from registration in Section 4(a)(2)
of the U.S. Securities Act to become unavailable with respect to offers and sales of the Standby Shares contemplated in this Agreement.

 

		6.2	Survival

 

All representations and warranties
of the Company contained in this Agreement will survive the completion of the purchase of Standby Shares by the Standby Guarantors
and will continue in full force and effect for a period of two years despite any investigation, inquiry or other steps which may
be taken by or on behalf of the Standby Guarantors.

 

		6.3	Notification

 

The Company will notify the
Standby Guarantors forthwith if it becomes aware of a fact or circumstance which has caused or would be reasonably likely to cause
a representation or warranty set out in this Article 6 to become untrue, inaccurate or misleading at any time (by reference to
circumstances subsisting at that time) before the Closing Date. Within two Business Days following the date that the SEC declares
the Registration Statement effective under the U.S. Securities Act, the Company will notify the Standby Guarantors of such effectiveness.

 

ARTICLE 7

REPRESENTATIONS,
WARRANTIES AND COVENANTS OF THE STANDBY GUARANTORS

 

		7.1	Representations

 

Each of the Standby Guarantors
severally, and not jointly (or jointly and severally), represents and warrants to the Company that:

 

		(a)	the execution, delivery and performance by the Standby Guarantor of this Agreement will not result
in the violation of, or constitute a default under or conflict with or cause the acceleration of any obligation of such Standby
Guarantor under:

 

		(i)	any provision of the constating documents or by-laws or resolutions of the governing body of such
Standby Guarantor, as applicable; or

 

		(ii)	any judgment, decree, order or award of any court, governmental body or arbitrator having jurisdiction
over and binding on such Standby Guarantor;

 

     

    	 	18	 

    

 

		(b)	this Agreement has been duly executed and delivered by it and constitutes
a legal, valid and binding obligation of it, enforceable against it in accordance with its terms (except in any case as enforcement
hereof may be limited by bankruptcy, insolvency, reorganization, moratorium and other laws relating to or affecting the rights
of creditors generally and except as limited by equitable principles);

 

		(c)	it is an “accredited investor” as such term is defined in National
Instrument 45-106 – Prospectus and Registration Exemptions of the Canadian Securities Administrators and U.S. Securities
Laws;

 

		(d)	it has, and on the Closing Date will have (regardless of the number of Rights
that are exercised by the holders of Rights prior to the Rights Expiry Time), the financial ability and sufficient funds to make
and complete the payment for the Standby Shares that it has committed to purchase pursuant to the Standby Guarantee, and the availability
of such funds is not and will not be subject to the consent, approval or authorization of any other Person. Each of the Standby
Guarantors acknowledges and covenants that they will, in connection with Section 8A.1(b) of NI 41-101, deliver to the Company satisfactory
evidence of the foregoing for delivery to the Commissions at or prior to the time of filing of the Final Prospectus with the Commissions;

 

		(e)	it is purchasing the Standby Shares for its own account for investment purposes
only and not with a view to resale or distribution and, in particular, it has no intention to distribute either directly or indirectly
any of the Standby Shares in the United States or to or for the account or benefit of a person in the United States; provided,
however, that this paragraph shall not restrict the Standby Guarantor from selling or otherwise disposing of any of the Standby
Shares pursuant to registration thereof pursuant to the U.S. Securities Act and any applicable state securities laws or under an
exemption from such registration requirements, or in circumstances where such registration requirements do not apply;

 

		(f)	it understands that the Standby Shares it purchases pursuant to the Standby
Guarantee have not been and will not be registered under the U.S. Securities Act or any applicable state securities laws (other
than as contemplated herein) and that the sale contemplated hereby will be made in reliance on an exemption from such registration
requirements;

 

		(g)	it understands and acknowledges that the Standby Shares will be “restricted
securities” within the meaning of Rule 144 under the U.S. Securities Act and if in the future it decides to offer, resell,
pledge or otherwise transfer any of the Standby Shares, such Standby Shares may be offered, sold, pledged or otherwise transferred
only (a) to the Company; (b) pursuant to an effective registration statement covering the sale of such Standby Shares under the
U.S. Securities Act; (c) in the United States in accordance with Rule 144 or Rule 144A under the U.S. Securities Act, if available,
and in compliance with any applicable state securities laws; or (d) in another transaction that does not require registration under
the U.S. Securities Act or any applicable state securities laws of the United States;

 

     

    	 	19	 

    

 

		(h)	it acknowledges that it is not purchasing the Standby Shares as a result
of any “general solicitation” or “general advertising” (as such terms are defined in Regulation D under
the U.S. Securities Act), including, without limitation, advertisements, articles, notices or other communications published on
the internet or in any newspaper, magazine or similar media, or broadcast over radio, television or the internet, or any seminar
or meeting whose attendees have been invited by general solicitation or general advertising;

 

		(i)	it is an “accredited investor” as defined in Rule 501(a) of
Regulation D under the U.S. Securities Act by virtue of satisfying one or more of the categories set forth under such definition;

 

		(j)	it understands that upon the issuance thereof, and until such time as the
same is no longer required under the applicable requirements of the U.S. Securities Act or applicable state laws and regulations,
the certificates representing the Standby Shares, and all certificates issued in exchange therefor or in substitution thereof,
will bear a legend restricting the transfer of the Standby Shares under the U.S. Securities Act;

 

		(k)	it consents to the Company making a notation on its records or giving instruction
to the registrar and transfer agent of the Company in order to implement the restrictions on transfer with respect to the Standby
Shares set forth and described herein;

 

		(l)	it understands and acknowledges that, other than as contemplated herein
and as contemplated by the Registration Rights Agreement, the Company has no obligation or present intention of filing with the
United States Securities and Exchange Commission or with any state securities administrator any registration statement in respect
of resales of the Standby Shares in the United States;

 

		(m)	it understands and agrees that there may be material tax consequences to
it of an acquisition or disposition of the Standby Shares, the Company gives no opinion and makes no representation with respect
to the tax status of the Company or the consequences to the Standby Guarantor under United States, state, local or foreign tax
law of its acquisition or disposition of the Standby Shares, including whether the Company will at any given time be deemed a “passive
foreign investment company” within the meaning of Section 1297 of the United States Internal Revenue Code;

 

		(n)	it acknowledges that there are risks associated with the purchase of and
investment in the Standby Shares and it alone, or with the assistance of its professional advisers, is knowledgeable and or experienced
in business and financial matters and is capable of evaluating the merits and risks of an investment in such securities and fully
understands the restrictions on resale of such securities and is capable of bearing the economic risk of the investment, including
the loss of its entire investment and it has prior experience in investing in securities of foreign issuers where no trading market
exists in the United States; and

 

     

    	 	20	 

    

 

		(o)	it has such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of an investment in the Standby Shares and is able to bear the economic risks
of such investment.

 

		7.2	Covenants and Agreements

 

If required under applicable
Laws or Securities Laws or under the rules and policies of the Exchange, each Standby Guarantor will use commercially reasonable
efforts to assist the Company to execute, deliver and file such required reports and such other required documents with respect
to the issue of the Rights, the Rights Shares and the Standby Shares, provided that the Company acknowledges and agrees that it
has not engaged the Standby Guarantors to act as underwriters (as defined under applicable Securities Laws) and none of the Standby
Guarantors will be required to sign a certificate in the Prospectus in that capacity or any other capacity.

 

		7.3	Survival

 

All representations and warranties
of each party contained in this Agreement or contained in any document delivered pursuant to this Agreement or in connection with
the Rights Offering contemplated in this Agreement will survive the completion of the purchase of Securities by the Standby Guarantors
and will continue in full force and effect for a period of two years despite any investigation, inquiry or other steps which may
be taken by or on any party’s behalf.

 

		7.4	Notification

 

The Standby Guarantors will
notify the Company forthwith if it becomes aware of a fact or circumstance which has caused or would be reasonably likely to cause
a representation or warranty set out in this Article 7 to become untrue, inaccurate or misleading at any time (by reference to
circumstances subsisting at that time) before the Closing Date.

 

ARTICLE 8

CLOSING AND CONDITIONS

 

		8.1	Closing

 

The closing of the purchase
by the Standby Guarantors and sale by the Company of the Standby Shares to be purchased by the Standby Guarantors hereunder (the
“Closing”) will be completed at the office of Morton Law LLP at 4:00 p.m. (Vancouver time) (the “Closing
Time”) on the Closing Date or at such other time and/or on such other date and/or at such other place as the Company
and each of the Standby Guarantors may agree upon in writing. On such date, and upon payment being made by the Standby Guarantors
for the Standby Shares in accordance with Section 3.3, the Company will issue, and thereafter deliver as soon as practicable, to
the Standby Guarantors certificates representing the Standby Shares, registered in the name of the Standby Guarantor or one or
more designee of the Standby Guarantor, as applicable.

 

     

    	 	21	 

    

 

		8.2	Guarantors Conditions

 

The obligation of the Standby
Guarantors to complete the transactions set out in this Agreement is subject to the following conditions being satisfied in full,
to the satisfaction of each of the Standby Guarantors acting separately:

 

		(a)	the absence of any Material Adverse Change between the date hereof and Closing;

 

		(b)	the Exchange will have conditionally accepted the issuance of the Rights,
the Rights Shares, the Standby Shares and the Standby Purchaser Fee, subject to receipt of customary final documentation;

 

		(c)	the Company will have made and/or obtained all necessary filings, approvals,
orders, rulings and consents of all relevant Regulatory Authorities and other governmental and regulatory bodies required in connection
with the Rights Offering and the purchase of the Standby Shares by the Standby Guarantors as contemplated by this Agreement;

 

		(d)	the Company will have performed or complied with, in all material respects,
each of its terms, conditions and covenants contained in this Agreement and each of its representations and warranties will be
true and correct as of the Closing Time with the same force and effect as if made at and as of such time;

 

		(e)	the terms and timing of the Rights Offering will not have been changed without
the approval in writing of each of the Standby Guarantors; and

 

		(f)	the completion of the Rights Offering and other transactions contemplated
hereby will have been conducted in accordance with applicable Laws, the Prospectus and this Agreement.

 

		8.3	Mutual Conditions

 

The obligation of the Standby
Guarantors and the Company to complete the transactions set out in this Agreement is subject to the following conditions being
satisfied in full, to the satisfaction of each of the Standby Guarantors and the Company acting separately (each of which may only
be waived by mutual consent):

 

		(a)	there will be no inquiry, investigation (whether formal or informal) or
other proceeding commenced by a Governmental Entity pursuant to applicable Laws in relation to the Company or any of its subsidiaries
or in relation to any of the directors and officers of the Company or any of its subsidiaries or in relation to the Standby Guarantors,
any of which suspends or ceases trading (which suspension or cessation of trading is continuing) in the Rights or Rights Shares
or operates to prevent or restrict the lawful distribution of the Rights, Rights Shares or Standby Shares (which prevention or
restriction is continuing);

 

		(b)	there will be no Order issued by a Governmental Entity pursuant to applicable
Laws and no change of Law, either of which suspends or ceases trading in the Rights or Rights Shares (which suspension or cessation
of trading is continuing) or operates to prevent or restrict the lawful distribution of the Rights, Rights Shares or Standby Shares
(which prevention or restriction is continuing); and

 

     

    	 	22	 

    

 

		(c)	there will not be any claims, litigation, investigations or proceedings,
including appeals and applications for review, in progress, pending, commenced or threatened by any Person, in respect of the Rights
Offering, that is reasonably likely to result in a Material Adverse Change.

 

		8.4	Performance by the Company

 

The Company agrees that the
conditions contained in Section 8.2 and 8.3 will be complied with so far as such conditions relate to acts to be performed or to
be caused to be performed by the Company and that it will use its commercially reasonable efforts to cause such conditions to be
complied with.

 

		8.5	Company Conditions

 

Provided that the Company
has used commercially reasonable efforts to comply with (or cause to be complied with) such conditions, the Company's obligation
to complete the transactions set out in this Agreement is subject to the condition being satisfied in full that each of the Standby
Guarantors will have performed or complied with, in all material respects, each of its terms, conditions and covenants contained
in this Agreement and each of its representations and warranties will be true and correct as of the Closing Time with the same
force and effect as if made at and as of such time.

 

ARTICLE 9

TERMINATION

 

		9.1	Termination by the Company

 

The Company will be entitled,
at any time and in its sole discretion, to elect to terminate this Agreement by giving written notice of such election to the Standby
Guarantors, if:

 

		(a)	any of the Standby Guarantors is in material default of its obligations hereunder
and fails to remedy such breach on or before the date that is five days following the date upon which the Company has provided
written notice of such breach;

 

		(b)	the Company determines in its sole discretion to terminate the Rights Offering
prior to the issuance of any Rights; or

 

		(c)	if any of the conditions set out in Section 8.3 or 8.5 are not satisfied
as at the Closing Time.

 

		9.2	Termination by the Standby Guarantors

 

Any of the Standby Guarantors
will be entitled, by giving written notice to the Company at any time prior to the Rights Expiry Time, to terminate and cancel,
without any liability on its part, its obligations under this Agreement independently of the other Standby Guarantors, if:

 

     

    	 	23	 

    

 

		(a)	there is any Material Adverse Change between the date hereof and Closing;

 

		(b)	any representation or warranty of the Company made in this Agreement is
determined not to have been true and correct when made or ceases to be true and correct, or if any covenant of the Company made
in this Agreement is not complied with;

 

		(c)	the Company is in material default of its obligations hereunder and fails
to remedy such breach on or before the date that is five days following the date upon which the Company has been provided written
notice of such breach;

 

		(d)	if any of the conditions set out in Section 8.2 or 8.3 are not satisfied
on or before the Closing Time;

 

		(e)	the Common Shares or the Rights (to the extent they are listed) are de-listed
or suspended or halted from trading for a period greater than five Business Days for any reason by the Exchange at any time prior
to the closing of the Rights Offering;

 

		(f)	the Effective Date does not occur at least 21 days prior to 90 days from
the issuance date of the Rights; or

 

		(g)	if the Rights Offering is terminated or cancelled.

 

 

		9.3	Termination Due to Effective Date Delay

 

This Agreement will Terminate
without further action of the Parties if the Effective Date does not occur at least 21 days prior to 90 days from the issuance
date of the Rights, in which event the Standby Guarantor will not be entitled to acquire the Standby Shares. Notwithstanding the
foregoing, the Parties may agree to extend the 90 day period in order to provide for an Expiry Date of at least 21 days from the
Effective Date, subject to the Company obtaining any required approvals from the Commissions and the Exchange to such extension,
in which event the Agreement will not terminate pursuant to this Section 9.3.

 

		9.4	Survival of Terms

 

Despite any other provision
of this Agreement, if the Company or any of the Standby Guarantors validly terminate(s) its obligations under this Agreement in
accordance with this Article 9 the obligations of both the Company and the terminating Standby Guarantor under this Agreement will
terminate, and there will be no further liability on the part of either of the terminating Standby Guarantor to the Company or
on the Company's part to the terminating Standby Guarantor hereunder (except for any liability of any party that exists at such
time or that may arise thereafter pursuant to Section 12.1).

 

     

    	 	24	 

    

 

ARTICLE 10

INDEMNIFICATION

 

		10.1	Indemnification by the Company

 

The Company covenants and agrees
to protect, indemnify and hold harmless the Standby Guarantors for and on behalf of itself and for and on behalf of and in trust
for each of its directors, officers, employees, agents and shareholders from and against any and all losses claims, damages, liabilities,
costs or expense caused or incurred:

 

		(a)	by reason of or in any way arising, directly or indirectly, out of any Misrepresentation
or alleged Misrepresentation in the Prospectus or Registration Statement other than any Misrepresentation or alleged Misrepresentation
relating to any information in the Prospectus or Registration Statement relating to the Standby Guarantors approved in writing
by the Standby Guarantors for inclusion in the Prospectus or Registration Statement, as applicable;

 

		(b)	by reason of or in any way arising, directly or indirectly, out of any Order
made or inquiry, investigation or proceeding commenced or threatened by any Commission, or any other competent authority in Canada
or the United States or before or by any Governmental Entity, based upon or relating to the Rights Offering or the other transactions
contemplated in this Agreement including, without limitation, any actions taken or statements made by or on behalf of the Company
in connection with the Rights Offering or the other transactions contemplated in this Agreement or any Misrepresentation or alleged
Misrepresentation relating to any information in the Prospectus relating to the Standby Guarantors and provided by the Standby
Guarantors;

 

		(c)	the non-compliance or alleged non-compliance by the Company with any requirement
of the Securities Laws or any other applicable Laws in connection with the Rights Offering or the other transactions contemplated
in this Agreement, including the Company’s non-compliance with any statutory requirement to make any document available for
inspection; and/or

 

		(d)	by reason of, or in any way arising, directly or indirectly, out of any material
breach or default of or under any representation, warranty, covenant or agreement of the Company contained herein.

 

		10.2	Indemnification Process

 

		(a)	In the event that any claim, action, suit or proceeding, including, without
limitation, any inquiry or investigation (whether formal or informal), is brought or instituted against any of the Persons in respect
of which indemnification is or might reasonably be considered to be provided for herein, such Person (an “Indemnified
Party”) will promptly notify the Person from whom indemnification is being sought under Section 10.1 (the “Indemnifying
Party”), and the Indemnifying Party will promptly retain counsel who will be reasonably satisfactory to the Indemnified
Party to represent the Indemnified Party in such claim, action, suit or proceeding, and the Indemnifying Party will pay all of
the reasonable fees and disbursements of such counsel relating to such claim, action, suit or proceeding.

 

     

    	 	25	 

    

 

		(b)	In any such claim, action, suit or proceeding, the Indemnified Party will
have the right to retain other counsel to act on his, her or its behalf, provided that the fees and disbursement of such other
counsel will be paid by the Indemnified Party unless:

 

		(i)	the Indemnifying Party and the Indemnified Party will have mutually agreed
to the retention of such other counsel; or

 

		(ii)	the named parties to any such claim, action, suit or proceeding (including
any added, third or interpleaded parties) include both the Indemnifying Party and the Indemnified Party and representation of both
parties by the same counsel would be inappropriate due to actual or potential differing interests between them (such as the availability
of different defenses).

 

		(c)	Subject to Section 10.2(b), it is understood and agreed that the Indemnifying
Party will not, in connection with any such claim, action, suit or proceeding in the same jurisdiction, be liable for the reasonable
fees and expense of more than one separate legal firm for all Persons in respect of which indemnification is or might reasonably
be considered to be provided for herein and such firm will be designated in writing by the Indemnified Party (on behalf of itself
and its directors, officers, employees, agents and shareholders).

 

		(d)	Notwithstanding anything herein contained, no Indemnified Party will agree
to any settlement of any such claim, action, suit, proceeding, inquiry or investigation in respect of which indemnification is
or might reasonably be considered to be provided for herein, unless the Indemnifying Party has consented in writing thereto, and
the Indemnifying Party will not be liable for any settlement of any such claim, action, suit, proceeding, inquiry or investigation
unless it has consented in writing thereto.

 

		(e)	If the indemnification provided for in this Article 10 is held by a court
of competent jurisdiction to be unavailable to an Indemnified Party with respect to any losses, claims, damages or liabilities
referred to herein, the Indemnifying Party, in lieu of indemnifying such Indemnified Party hereunder, will to the extent permitted
by applicable Law contribute to the amount paid or payable by such Indemnified Party as a result of such loss, claim, damage or
liability in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the
Indemnified Party on the other in connection with the act or omission that resulted in such loss, claim, damage or liability, as
well as any other relevant equitable considerations. The relative fault of the Indemnifying Party and of the Indemnified Party
will be determined by a court of law by reference to, among other things, whether the untrue or alleged untrue statement of material
fact or the omission to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Party
and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or
omission provided, however, that no person guilty of fraudulent misrepresentation will be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.

 

     

    	 	26	 

    

 

		(f)	The obligations of the Company under this Article 10 will survive completion
of the Rights Offering and the termination of this Agreement. No Indemnifying Party, in the defence of any such claim or litigation,
will, except with the consent of the Indemnified Party, consent to entry of any judgment or enter into any settlement which does
not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from
all liability in respect to such claim or litigation.

 

ARTICLE 11

NOTICE

 

		11.1	Notice

 

Any notice under this Agreement
will be given in writing and must be delivered, sent by email, or overnight courier and addressed to the party to which notice
is to be given at the following address, or at another address designated by such party in writing:

 

		(a)	if to the Company:

 

Golden Queen Mining Co. Ltd.

2300 - 1066 West Hastings Street

Vancouver, British Columbia

V6E 3X2 Canada

Attn: Guy Le Bel – Chief Financial Officer

Email: glebel@goldenqueen.com

 

with a copy to:

 

Morton Law LLP

Suite 1200 – 750 West Pender St. Vancouver
BC

V6C 2T8

Attn: Edward Mayerhofer

Email: elm@mortonlaw.ca

 

		(b)	if to the Standby Guarantors:

 

c/o East Hill Management Company

70 Main Street

Suite 300

Petersborough, NH 03458

Attention: Thomas Clay

Email:thomas.clay@easthillmgt.com

 

with a copy to:

 

Sullivan & Worcester LLP

One Post Office Square

Boston, MA 02109

Attention:        William
A. Levine, Esq. and Benjamin J. Armour, Esq.

Telephone:       (617)
338-2921

E-mail:              wlevine@sandw.com

             barmour@sandw.com

 

     

    	 	27	 

    

 

If notice is sent by email
or is delivered, it will be deemed to have been given at the time of transmission or delivery. If notice is mailed, it will be
deemed to have been received three (3) business days following the date of mailing of the notice. If there is an interruption in
normal mail service due to strike, labour unrest or other cause at or prior to the time a notice is mailed the notice will be sent
by facsimile or will be delivered.

 

ARTICLE 12

GENERAL

 

		12.1	Expenses

 

Whether or not the transactions
herein contemplated will be completed, all expenses of or incidental to the Rights Offering and the transactions contemplated herein
or in the Prospectus including, without limitation: all reasonable fees and disbursements of counsel, including counsel to the
Standby Guarantors (to a maximum of US$75,000 for the Standby Guarantors’ legal expenses), transfer agents, outside consultants
and experts (including appraisers, engineers and credit reports), filing fees, printing costs, the preparation and holding of information
meetings, the reasonable out-of-pocket costs related to information meetings and travel, and the Standby Guarantors’ reasonable
out-of-pocket expenses including the Standby Guarantors’ reasonable travel expenses in connection with due diligence (including
hotel accommodations and meals) together with all applicable taxes thereon, will be borne by and be for the account of the Company.

 

		12.2	Further Assurances

 

From time to time after the
date of this Agreement, the parties to this Agreement will execute, acknowledge and deliver to the other parties such other instruments,
documents and certificates and will take such other actions as the other parties may reasonably request in order to consummate
the transactions contemplated by this Agreement.

 

		12.3	Assignment

 

This Agreement may not be
assigned by any party to this Agreement, by operation of law or otherwise, without the prior written consent of each of the other
parties to this Agreement.

 

		12.4	Enurement

 

This Agreement will enure
to the benefit of and be binding upon the parties to this Agreement and their respective heirs, executors, successors and permitted
assigns.

 

     

    	 	28	 

    

 

		12.5	Waiver

 

Failure by any party to this
Agreement to insist in any one or more instances upon the strict performance of any one of the covenants or rights contained in
this Agreement will not be construed as a waiver or relinquishment of such covenant or right. No waiver by either party to this
Agreement of any such covenant or right will be deemed to have been made unless expressed in writing and signed by the waiving
party.

 

		12.6	Amendments

 

No term or provision of this
Agreement may be amended, discharged or terminated except by an instrument in writing signed by the party against which the enforcement
of the amendment, discharge or termination is sought.

 

		12.7	Counterparts

 

This Agreement may be executed
in several counterparts and delivered by email or other electronic means, each of which when so executed will be deemed to be an
original and such counterparts and electronic copies together will constitute one and the same instrument and despite their date
of execution they will be deemed to be dated as of the date of this Agreement. This Agreement will be deemed to have been entered
into and to have become effective at the location at which the Guarantors will have signed an original, counterpart or electronic
version thereof, without regard to the place at which the Company will have signed this Agreement.

 

		12.8	Time

 

Time is of the essence of this
Agreement.

 

		12.9	Entire Agreement

 

This Agreement and any other
agreements and other documents referred to in this Agreement and delivered in connection with this Agreement, constitutes the entire
agreement between the parties to this Agreement pertaining to the subject matter of this Agreement and supersedes all prior agreements,
understandings, negotiations and discussions, whether oral or written, between the parties with respect to the subject matter of
this Agreement.

 

[Remainder of page intentionally left blank.
Signature page follows.]

 

     

    	 	29	 

    

 

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

 

 

	GOLDEN QUEEN MINING CO. LTD.
	 	 	 
	 	 	 
	Per:	/s/ Brenda Dayton
	 	Name: 	Brenda Dayton
	 	Title:	Corporate Secretary
	 	 	 
	 	 	 
	LANDON T. CLAY 2009 IRREVOCABLE TRUST
	 	 	 
	 	 	 
	Per:	/s/ Thomas M. Clay
	 	Name: 	Thomas M. Clay
	 	Title:	Trustee
	 	 	 
	THE MASTERS 1, LLC
	 	 	 
	 	 	 
	Per:	/s/ Jonathan C. Clay
	 	Name: 	Jonathan C. Clay
	 	Title:	Managing Member

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