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                                                                    EXHIBIT 10.1

                INCENTIVE AND PERFORMANCE STOCK OPTION AGREEMENT
                                    UNDER THE
                1992 PRIMEDIA INC. STOCK PURCHASE AND OPTION PLAN
                             AS AMENDED (THE "PLAN")

     This Incentive Stock Option Agreement (the "Option Agreement") has been
entered into as of April ________, 2002 (the "Effective Date") between PRIMEDIA
Inc., a Delaware corporation (unless the context otherwise requires, together
with any subsidiary (as such term is defined in the Plan), (the "Corporation"),
and __________________ (the "Optionee") pursuant to certain provisions of the
Plan.

     1.   DEFINITIONS. Throughout this Option Agreement, capitalized terms not
          otherwise defined herein shall have the meanings indicated in the
          Plan.

     2.   OPTION GRANT. Subject to the terms and conditions set forth herein,
          the Corporation grants to the Optionee that number of options to
          purchase from the Corporation at the respective purchase prices set
          forth below per share, (as adjusted from time to time pursuant to the
          terms of this Agreement and the Plan, (the "Purchase Price"), up to,
          but not exceeding, in the aggregate, ___________ shares of Common
          Stock (the "Options"), as adjusted pursuant to the Plan. Thirty
          percent of the Options will vest in accordance with the provisions of
          Section 4 (a) (the "Time Vest Options") and 70% of the Options will
          vest in accordance with the provisions of Section 4 (b) (the
          "Performance Vest Options").

                                TIME VEST OPTIONS

<Table>
<Caption>
          NUMBER OF OPTIONS                  PURCHASE PRICE
          -----------------                  --------------
          <S>                                    <C>
          30% of Options                         $  4
</Table>

                            PERFORMANCE VEST OPTIONS

<Table>
          <S>                                    <C>
          30% of Options                         $  5
          40% of Options                         $  6
</Table>

     3.   GRANT INTENDED AS INCENTIVE STOCK OPTION; OTHER OPTIONS. These Options
          are intended to be treated for federal income tax purposes as
          Incentive Stock Options under Section 422 of the Internal Revenue Code
          of 1986, as amended (the "Code"), to the maximum extent permissible
          under the Code. If for any reason, all or any of these Options cannot
          be treated as Incentive Stock Options under the Code, the part of
          these Options that cannot be treated as Incentive Stock Options shall
          be valid and outstanding non-qualified stock options. These Options
          are in addition to any other options heretofore or hereafter granted
          to the Optionee by the Corporation or any subsidiary but a duplicate
          original of this instrument shall not cause the grant of another
          option.

     4.   VESTING.

          (a) TIME VEST OPTIONS. So long as the Optionee continues to be
              employed by the Corporation through the applicable vesting date,
              the Optionee's right to exercise these Options with respect to the
              number of Time Vest Options described in Section 2 shall vest on
              an equal prorata basis at the end of each of the 48 calendar
              months starting with the month in which the Effective Date occurs.

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          (b) PERFORMANCE VEST OPTIONS. So long as the Optionee continues to be
              employed by the Corporation or a subsidiary through the applicable
              vesting date, the Optionee's right to exercise these Options with
              respect to 100% of the Performance Vest Options shall vest on the
              eighth anniversary of the Effective Date; HOWEVER, Optionee's
              right to exercise the Performance Vest Options shall accelerate if
              the respective Target EBITDA (as defined below) is met in the
              respective years, as set forth in subsection (d) below.

          (c) For purposes of this Section 4:

                  (i)   "EBITDA" shall mean for any Fiscal Year an amount equal
                        to the Corporation's consolidated net income from
                        continuing businesses for such year PLUS the sum of
                        interest expense, provisions for income and franchise
                        taxes, depreciation, amortization of intangible assets,
                        other (income) and charges including non-cash
                        compensation and non-recurring charges, provision for
                        severance, closures and restructuring related costs,
                        (gains) losses on the sales of businesses and other,
                        net, amortization of deferred financing costs,
                        provisions for impairment of investments, impairments of
                        goodwill and intangibles, expenses paid or accrued for
                        consulting services provided by Capstone Consulting, and
                        extraordinary charges MINUS the sum of interest income
                        and extraordinary gains, if any, for such year. EBITDA
                        shall be determined in a manner consistent with the
                        Corporation's prior practice as set forth in the
                        Corporation's financial statements forming part of its
                        Quarterly Report on Form 10-Q for the calendar quarter
                        ended March 31, 2002 (Footnote 15, Business Segment
                        Information) which will in any event be in accordance
                        with generally accepted accounting principles as in
                        existence on March 31, 2002.

                  (ii)  "Fiscal Year" means any one of the Corporation's
                        calendar years 2002 through 2005, as applicable.

                  (iii) "Target EBITDA" shall mean, for any given Fiscal Year
                        the EBITDA set forth in Section 4.

          (d) The Performance Vest Options shall accelerate in accordance with
              the following table when the respective Target EBITDA is met in
              any one of the Fiscal Years set forth in the column "Fiscal Year"
              next to the Target EBITDA:
<Table>
<Caption>
               NUMBER OF     PURCHASE                        FISCAL
 TRANCHE        OPTIONS       PRICE     TARGET EBITDA         YEAR
---------   --------------   --------   -------------   ------------------
<S>         <C>                <C>      <C>             <C>
Tranche 1   30% of Options     $ 5      $ 300 million   2003
Tranche 2   30% of Options     $ 6      $ 340 million   2003 or 2004
Tranche 3   10% of Options     $ 6      $ 380 million   2003, 2004 or 2005
</Table>

          (e) In the event that the Corporation fails to achieve, in respect of
              any given Fiscal Year, Target EBITDA set for such year, there
              shall be no acceleration of vesting of any Tranche as to which the
              Target EBITDA is not met in that Fiscal Year.

                                       2
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          (f) The Corporation shall use its best efforts to determine EBITDA for
              each Fiscal Year by March 31 of the following Fiscal Year and,
              following such determination, the Corporation shall promptly
              notify Optionee of the results of such determination.

          (g) In addition, the Compensation Committee may adjust any or all
              Target EBITDA to fairly and appropriately reflect the effect of
              any significant mergers, acquisitions, or dispositions approved by
              the Board of Directors in any case that was not contemplated in
              establishing the respective Target EBITDA; PROVIDED, HOWEVER, that
              in the event the Compensation Committee takes any such action,
              such adjustment shall be only the amount deemed reasonably
              necessary by the Compensation Committee, in the exercise of its
              good faith judgment, to accurately reflect the direct and
              measurable effect such event has on such Target EBITDA. The
              Compensation Committee's determination of such necessary
              adjustment shall be made within 60 days following the completion
              or closing of such event, and shall be based on the Corporation's
              accounting as set forth in its books and records and on the
              Corporation's financial plan pursuant to which the Target EBITDA
              was originally established.

          (h) The Options shall vest on the last day of the Fiscal Year as to
              which the EBITDA Target is met.

     5.   CHANGE OF CONTROL. In the event of a "Change of Control" (as defined
          in this paragraph), then 100% of such unvested portion of the Time
          Vest Options shall become fully vested. A "Change of Control" for
          purposes of this Option Agreement shall mean:

          (a) A transaction or series of related transactions whereby KKR
              Associates and/or its Affiliates ("KKR") (a) sells or otherwise
              disposes of beneficial ownership (within the meaning of Rule 13d-3
              of the Securities Exchange Act of 1934, as amended (the "1934
              Act")) of securities of the Corporation representing 35% or more
              of the combined voting power of all securities of the Corporation
              entitled to vote in the election of directors of the Corporation
              to any single person or group (within the meaning of Section 13(d)
              (3) of the 1934 Act, and the rules and regulations promulgated
              thereunder), other than to an Affiliate of KKR, and in connection
              with or following such disposition such single person or group
              obtains control of a majority of the seats (other than vacant
              seats) on the Board.

          (b) the Corporation adopts any plan of liquidation providing for the
              distribution of all or substantially all of its assets;

          (c) all or substantially all of the assets or business of the
              Corporation is disposed of pursuant to a merger, consolidation or
              other transaction (unless the shareholders of the Corporation
              immediately prior to such merger, consolidation or other
              transaction beneficially own, directly or indirectly, in
              substantially the same proportion as they owned the voting stock
              of the Corporation, all of the voting stock or other ownership
              interests of the entity or entities, if any, that succeed to the
              business of the Corporation); or the Corporation combines with
              another Corporation and is the surviving corporation but,
              immediately after the combination, the shareholders of the
              Corporation immediately prior to the combination hold, directly or
              indirectly, 50% or less of the voting stock of the combined
              Corporation (there being excluded from the number of shares held
              by such shareholders, but not from the voting stock of the

                                       3
<Page>

              combined Corporation, any shares received by affiliates of such
              other Corporation in exchange for stock of such other
              Corporation).

     6.   EXPIRATION OF OPTIONS. The Options granted hereunder may not be
          exercised to any extent after the first to occur of the following
          events (the "Expiration Date"):

          (a) The tenth anniversary of the Grant Date; or

          (b) The first anniversary of the effective date of the Optionee's
              termination of employment by reason of death, Retirement or
              Permanent Total Disability or

          (c) 90 days after termination of the Optionee's employment for any
              reason other than for death, Permanent or Total Disability or
              Retirement; or

          (d) If the Committee so determines, the effective date of either the
              merger or consolidation of Corporation into another corporation,
              or the exchange or acquisition by another corporation of all or
              substantially all of Corporation's assets or 80% or more of its
              then outstanding voting stock, or the recapitalization,
              reclassification, liquidation or dissolution of Corporation. At
              least ten (10) days prior to the effective date of such event, the
              Committee shall give the Optionee notice of such event if the
              Options have not yet been fully exercised and the Expiration Date
              has not yet occurred. Nothing in this provision shall negate the
              acceleration of the Time Vest Options upon a change.

     7.   EXERCISE.

          (a) During the Optionee's lifetime, only the Optionee may exercise the
              Options or any exercisable portion thereof. After the death of the
              Optionee and prior to the close of business on the Expiration
              Date, the Options or any exercisable portion thereof may be
              exercised by the Optionee's personal representative, or by any
              person empowered to do so under the Optionee's will or under the
              then applicable laws of descent and distribution. The party
              entitled to exercise the Options shall be referred to herein as
              the "Exercising Party".

          (b) The Options or any exercisable portion thereof may be exercised in
              whole or in part at any time prior to the close of business on the
              Expiration Date; provided, however, that any exercise shall be for
              whole shares only.

          (c) The Options or any exercisable portion thereof may be exercised
              solely by delivering to the Office of the Secretary of Corporation
              all of the following prior to the closing of business on the
              Expiration Date:

              (i)   Notice in writing, signed by the Exercising Party, stating
                    the number of Shares with respect to which the Options are
                    being exercised;

              (ii)  Full payment (in cash, by check, or Shares owned more than
                    six months which shall be valued at their fair market value,
                    or by a combination thereof) for the Shares with respect to
                    which such Options or portion thereof are exercised, plus
                    any withholdings applicable thereto; and

                                       4
<Page>

              (iii) In the event that the Exercising Party is not the Optionee,
                    appropriate proof, in the sole judgement of Corporation, of
                    the right of such person to exercise the Options.

          (d) No Options shall become exercisable as to any additional Shares
              following the effective date of the termination of employment of
              the Optionee for any reason other than the death, Permanent or
              Total Disability or Retirement of Optionee; and

          (e) In the event of a termination of employment because of death,
              Permanent or Total Disability or Retirement, the Options shall
              become exercisable as to all Shares as of the effective date of
              such termination of employment

          (f) Notwithstanding the other provisions of this Section 7, the
              Committee may take such reasonable additional steps that it
              reasonably deems appropriate, including the requirement of
              additional documents, representations and actions of or by the
              Exercising Party, to ensure the observance and performance of the
              representations set forth in the notice of exercise, and
              compliance with applicable federal or state securities laws or
              regulations.

          (g) In addition, Corporation shall not be required to issue or deliver
              any certificate representing Shares prior to the obtaining of
              approval or other clearance from any state or federal governmental
              agency or securities exchange that the Committee shall, in its
              absolute discretion, determine to be necessary or advisable.

          (h) The Shares deliverable upon the exercise of the Options, or any
              portion thereof, may be either previously authorized but unissued
              shares of Common Stock or issued Shares that have been reacquired
              subsequently by Corporation. Such Shares shall be fully paid and
              nonassessable.

          (i) Each Exercising Party shall be obligated to notify Corporation in
              writing when any Shares are sold, transferred or otherwise
              disposed of.

          (j) Neither the Optionee nor any Exercising Party shall be a
              stockholder of the Corporation or have any of the rights or
              privileges thereof in respect of any Shares unless and until
              certificates representing such Shares shall have been issued by
              Corporation to such Optionee or other Exercising Party.

          (k) Notwithstanding the foregoing, the Options may be exercised by the
              Exercising Party utilizing a "cashless exercise" or "brokered
              exercise" transaction.

     8.   POWERS OF COMMITTEE. The Committee shall have the power to interpret
          the Plan and this Agreement and to adopt such rules for the
          administration, interpretation and application of the Plan as are
          consistent therewith and to interpret or revoke any such rules. All
          actions taken and all interpretations and determinations made by the
          Committee shall be final and binding upon the Optionee or other
          Exercising Party, Corporation and all other interested persons. No
          member of the Committee shall be personally liable for any action,
          determination or interpretation made in good faith with respect to the
          Plan or this Agreement. In its absolute discretion, the Board of
          Directors of Corporation may at any

                                       5
<Page>

          time and from time to time exercise any and all rights and duties of
          the Committee under the Plan and this Agreement.

     9.   OPTIONS NOT TRANSFERABLE. The Optionee's rights under this Agreement
          may not be transferred or assigned, and neither the Options nor any
          interest or right therein or part thereof shall be liable for the
          debts, contracts or engagements of the Optionee or his or her legal
          successors or shall be subject to disposition by transfer, alienation,
          anticipation, pledge, encumbrance, assignment or any other means,
          whether such disposition be voluntary or involuntary or occur by
          operation of law by judgement, levy, attachment, garnishment or any
          other legal or equitable proceedings (including bankruptcy), and any
          attempted disposition thereof shall be null and void and of no effect.
          Notwithstanding the foregoing, this Section 9 shall not prevent
          transfers by will or by the applicable laws of descent and
          distribution. All of the terms and provisions of this Agreement shall
          be binding on, and shall inure to the benefit of, the respective legal
          successors and assigns of the parties.

     10.  NO OBLIGATION TO EXERCISE OPTIONS. The grant and acceptance of these
          Options imposes no obligation on the Optionee to exercise.

     11.  ADJUSTMENTS. The Option Purchase Price and the number of shares of
          Common Stock subject to these Options shall be subject to adjustment
          from time to time in accordance with Section 7.1 of the Plan.

     12.  RIGHTS AS SHAREHOLDER. An Optionee shall have no rights as a
          stockholder of the Corporation with respect to any shares underlying
          the Options until the day of the payment of the Option Purchase Price
          in accordance with the terms and provisions hereof.

     13.  PAYMENT OF WITHHOLDING TAXES. Upon the Optionee's exercise of his or
          her Options in accordance with the provisions of this Option
          Agreement, the Optionee shall pay to the Corporation at the time of
          delivery of the notice and payment of the Purchase Price the amount of
          any federal, state or local income tax withholding or other employment
          related tax that may be due upon the exercise of the Options. The
          determination of the amount of any such federal, state or local income
          tax withholding or other employment tax due in such event shall be
          made by the Corporation and shall be binding upon the Optionee.

     14.  RESERVATION AND REGISTRATION OF SHARES. The Corporation shall at all
          times during the term of the Options reserve and keep available such
          number of shares of Common Stock as will be sufficient to satisfy the
          requirements of this Agreement. The Shares issuable upon the exercise
          of the Options are registered under the Securities Act of 1933 (the
          "Act") and the Corporation shall use its best efforts to maintain the
          registration under the Act of the Shares issuable upon exercise of the
          Options.

     15.  DEFERRAL OF ISSUANCE TO COMPLY WITH APPLICABLE LAWS. Anything in this
          Option Agreement to the contrary notwithstanding, if, at any time
          specified herein for the issuance of Common Stock resulting from the
          exercise of these Options, any law, regulation or requirements of any
          governmental authority having jurisdiction in the premises shall
          require either the Corporation or the Optionee, in the judgment of the
          Corporation, to take any action in connection with the shares then to
          be issued, then the issue of such shares shall be deferred until such
          action shall have been taken.

                                       6
<Page>

     16.  ADJUSTMENTS IN OPTIONS PURSUANT TO MERGER, CONSOLIDATION, ETC. In the
          event that the outstanding shares of the stock subject to Options are,
          from time to time, changed into or exchanged for a different number or
          kind of shares of the Corporation or other securities of the
          Corporation by reason of a merger, consolidation, recapitalization,
          reclassification, stock split, stock dividend, combination of shares,
          or otherwise, the Corporation shall make an adjustment in the number
          and kind of shares and/or the amount of consideration as to which or
          for which, as the case may be, such Options, or portions thereof then
          unexercised, shall be exercisable, in such manner as the Corporation
          determines is reasonably necessary to maintain as nearly as
          practicable the rights, benefits and obligations that the parties
          would have had absent such event. Any such adjustment made by the
          Corporation shall be final and binding upon the Optionee, the
          Corporation and all other interested persons.

     17.  MISCELLANEOUS.

          (a) Any notice to be given under the terms of this Agreement to the
              Corporation shall be addressed to Corporation as follows:

                  PRIMEDIA, Inc.
                  745 Fifth Avenue
                  New York, NY 10151
                  Attention:  Secretary

              Any notice to be given to the Optionee shall be sent to the
              address given beneath his or her signature to this Agreement. By a
              notice given pursuant to this Section 17, either party may
              hereafter designate a different address for notices. Any notice
              that is required to be given to the Optionee shall, if the
              Optionee is then deceased, be given to the Optionee's personal
              representative if such representative has previously informed
              Corporation of his or her status and address by written notice
              under this Section 17. All notices and other communications under
              this Option Agreement shall be in writing and shall have been
              deemed duly given when delivered personally, mailed by registered
              mail, return receipt requested or sent by documented overnight
              delivery service.

          (b) Titles are provided herein for convenience of reference only and
              are not to serve as a basis for interpretation or construction of
              this Option Agreement.

              (i)   This Option Agreement, the Options and any Shares issued
                    hereunder shall be subject to all of the terms and
                    provisions of the Plan to the extent applicable. In the
                    event of any conflict between this Option Agreement and the
                    Plan, the terms of the Plan shall control.

              (ii)  Notwithstanding the provisions of any agreement relating to
                    Optionee's employment heretofore entered into, none of the
                    Performance Vest Options shall vest upon a Change of
                    Control.

          (c) No provision of this Option Agreement may be amended or modified
              except by an instrument or instruments in writing signed by the
              parties hereto. Any party may waive compliance by another with any
              of the provisions of this Option Agreement, provided

                                       7
<Page>

              that (a) no waiver of any provision hereof shall be construed as a
              waiver of any other provision or subsequent breach and (b) any
              such waiver shall be in writing. The failure of any party hereto
              to enforce at any time any provision hereof shall not be construed
              to be a waiver of such provision, nor in any way to affect the
              validity hereof of any part hereof or the right of any party
              thereafter to enforce each and every such provision.

          (d) To the extent not governed by the laws of the United States,
              including the Code, this Agreement shall be governed by, and
              construed and enforced in accordance with, the laws of the State
              of Delaware (without regard to conflicts of law principles for
              such state).

          (e) Corporation and the Optionee hereby irrevocably submit to the
              jurisdiction of any New York or Delaware state court, or any
              Federal court in the Southern District of New York or in Delaware
              in any action or proceeding arising out of or relating to this
              Option Agreement, and the parties hereto irrevocably agree that
              all claims in respect of such action or proceeding shall be heard
              and determined only in such courts. Corporation and the Optionee
              hereby consent to and grant to any such court jurisdiction over
              the persons of such parties and over the subject matter of any
              such dispute and agree that delivery or mailing of any process or
              other papers in the manner provided in Section 17 herein, or in
              such other manner as may be permitted by law, shall be valid and
              sufficient service thereof.

     IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto on the date first set forth above.

                                    PRIMEDIA Inc.

                                    By:
                                        ---------------------------
                                             Optionee
                                             Title

          AGREED AND ACCEPTED BY:

          -------------------------
          Optionee Signature

          Optionee Name (Print):
                                -----------------------------------
          Social Security Number:
                                 ----------------------------------
          Address:
                   ------------------------------------------------

                   ------------------------------------------------

                   ------------------------------------------------

                   ------------------------------------------------

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EXHIBIT 10.1    
  

 
 

JONES SODA CO.
  
    2002 STOCK OPTION PLAN    
  

SECTION 1.    PURPOSE  

        The purpose of this 2002 Stock Option Plan (the "Plan") is to enhance the long-term shareholder value
of Jones Soda Co., a Washington corporation (the "Company"), by offering opportunities to employees,
directors, officers, consultants, agents, advisors and independent contractors of the Company and its Subsidiaries (as defined in Section 2) to share in its growth and success, to encourage
them to remain in the service of the Company and its Subsidiaries and to participate in the ownership of the Company. 

SECTION 2.    DEFINITIONS  

        For purposes of the Plan, the following terms shall be defined as set forth below: 

        "Board" means the Board of Directors of the Company. 

        "Cause" means dishonesty, fraud, misconduct, unauthorized use or disclosure of confidential information, trade secrets or intellectual
property, or conviction or confession (including a plea of no contest) of a crime punishable by law (except minor violations), or conduct that adversely affects the
Company's business or reputation, in each case as determined by the Plan Administrator in its sole discretion, and its determination as to whether an action constitutes Cause shall be conclusive and
binding. 

        "Code" means the Internal Revenue Code of 1986, as amended from time to time. 

        "Common Stock" means the Company common stock, no par value per share. 

        "Corporate Transaction" means any of the following events: 

        (a)  Consummation
of any merger or consolidation of the Company in which the Company is not the continuing or surviving corporation, or pursuant to which shares of the Common
Stock are converted into cash, securities or other property, if following such merger or consolidation the holders of the Company's outstanding voting securities immediately prior to such merger or
consolidation own less than 50% of the outstanding voting securities of the surviving corporation; 

        (b)  Consummation
of any sale, lease, exchange or other transfer in one transaction, or a series of related transactions, of all or substantially all of the Company's assets
other than a transfer of the Company's assets to a majority-owned subsidiary corporation of the Company; or 

        (c)  Approval
by the holders of the Common Stock of any plan or proposal for the liquidation or dissolution of the Company. 

        Ownership
of voting securities shall take into account and shall include ownership as determined by applying Rule 13d-3(d)(1)(i) (as in effect on the date of
adoption of the Plan) under the Exchange Act. 

        "Disability" means "disability" as that term is defined for purposes of Section 22(e)(3) of the Code. As of the date of adoption of
this Plan, such terms means the inability to engage in any substantial gainful activity by reason of any medically determinable mental or physical impairment which can be expected to result in death
or which has lasted or can be expected to last for a continuous period of not less than 12 months. 

1

 

        "Employee" means any person, including officers and directors, employed by the Company (or one of its parent corporations or subsidiary
corporations), with the status of employment determined based upon such minimum number of hours or periods worked as shall be determined by the Plan Administrator in its discretion, subject to any
requirements of the Code. For purposes of this provision, "parent corporation" and "subsidiary corporation" shall have the meanings attributed to those terms for purposes of Section 422 of the
Code. 

        "Exchange Act""means the Securities Exchange Act of 1934, as amended. 

        "Fair Market Value" shall be the fair market value of the Common Stock, as of any date, as determined by the Plan Administrator as
follows: 

        (a)  if
the Common Stock is listed on any established stock exchange or a national market system, including without limitation the National Market tier of The Nasdaq Stock
Market ("Nasdaq"), the Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported), as quoted on
such system or exchange, or the system or exchange with the greatest volume of trading in Common Stock, for the last market trading day prior to the time of determination, as reported in The Wall
Street Journal or such other source as the Plan Administrator deems reliable; 

        (b)  If
the Common Stock is quoted on the Nasdaq system (but not on the National Market tier thereof), on the OTC Bulletin Board, the TSX Venture Exchange or regularly quoted
by a recognized securities dealer but selling prices are not reported (or if reported or quoted on more than one such exchange, then such exchange as determined by the Plan Administrator), its Fair
Market Value shall be the mean between the high bid and low asked prices for the Common Stock for the last market trading day prior to the time of determination, as reported in The Wall Street Journal
or such other source as the Plan Administrator deems reliable; or 

        (c)  In
the absence of an established market for the Common Stock, the Fair Market Value shall be determined in good faith by the Plan Administrator. 

        "Grant Date" means the date the Plan Administrator adopted the granting resolution or a later date designated in a resolution of the Plan
Administrator as the date an Option is to be granted. 

        "Holder" means (a) the person to whom an Option is granted, (b) for a Holder who has died, the personal representative of
the Holder's estate, the person(s) to whom the Holder's rights under the Option have passed by will or by the applicable laws of descent and distribution, or the beneficiary designated in accordance
with Section 11, or (c) the person(s) to whom an Option has been transferred in accordance with Section 11. 

        "Incentive Stock Option" means an Option granted with the intention that it qualify as an "incentive stock option" as that term is defined
in Section 422 of the Code. 

        "Nonqualified Stock Option" means an Option other than an Incentive Stock Option. 

        "Option" means the right to purchase Common Stock granted under Section 6. 

        "Plan Administrator" means the Board or any committee of the Board designated to administer the Plan under Section 3.1. 

        "Securities Act" means the Securities Act of 1933, as amended. 

        "Subsidiary" (except as provided in the definition of "Employee" above) means any entity that is directly or indirectly controlled by the
Company or in which the Company has a significant ownership interest, as determined by the Plan Administrator, and any entity that may become a direct or indirect parent of the Company. 

        "Successor Corporation" has the meaning set forth under Section 10.2. 

2

 

SECTION 3.    ADMINISTRATION  

        3.1    Plan Administrator    

        (a)  The
Plan shall be administered by the Board, or a committee or committees (which term includes subcommittees) appointed by, and consisting of two or more members of, the
Board. The Board may delegate the responsibility for administering the Plan with respect to designated classes of eligible persons to different committees consisting of two or more members of the
Board, subject to such limitations as the Board deems appropriate. Committee members shall serve for such term as the Board may determine, subject to removal by the Board at any time. 

        (b)  If,
and so long as, the Company has a class of equity securities registered under Section 12 of the Exchange Act, the Board shall consider in selecting the Plan
Administrator and the membership of any committee acting as Plan Administrator, with respect to any persons subject or likely to become subject to Section 16 of the Exchange Act, the provisions
regarding (a) "outside directors" as contemplated by Section 162(m) of the Code and (b) "nonemployee directors" as contemplated by Rule 16b-3 under the Exchange
Act. 

        3.2    Administration and Interpretation by the Plan Administrator.    Subject to the express provisions of the Plan,
the Plan Administrator shall have the exclusive authority, in its sole discretion, to determine all matters relating to Options granted under the Plan, including, without limitation, the selection of
individuals to be granted Options, the number of shares of Common Stock subject to an Option, all terms, conditions, restrictions and limitations, if any, of an Option and the terms of any document or
agreement that evidences the Option, the Fair Market Value and the exercise price of the Option, the term, whether such Options shall be immediately exercisable or shall become exercisable in
increments over time, and all other terms and conditions thereof, and to make all other determinations necessary or advisable in the administration of the Plan. The Plan Administrator shall also have
exclusive authority to interpret the Plan and may from time to time adopt, amend and rescind, rules and regulations of general application for the Plan's administration. The Plan Administrator's
interpretation of the Plan and its rules and regulations and the terms of any Option, and all actions taken and determinations made by the Plan Administrator pursuant to the Plan, shall be conclusive
and binding on all parties involved or affected. The Plan Administrator may delegate administrative duties to such of the Company's officers as it so determines. 

        3.3    Replacement of Options.    Without limiting the authority granted to the Plan Administrator under
Section 3.2, the Plan Administrator, in its sole discretion, shall have the authority, among other things, to (a) grant Options subject to the condition that Options previously granted
at a higher or lower exercise price under the Plan be canceled or exchanged in connection with such grant (the number of shares covered by the new Options, the exercise price, the term and the other
terms and conditions of the new Option, shall be determined in accordance with the Plan and may be different from the provisions of the canceled or exchanged Options), and (b) amend or modify
outstanding and unexercised Options, with the consent of the Holder, to, among other things, reduce the exercise price per share, establish the exercise price at the then-current Fair
Market Value or accelerate or defer the exercise date, vesting schedule or expiration date of any Option. 

SECTION 4.    STOCK SUBJECT TO THE PLAN  

        The stock subject to this Plan shall be Company Common Stock. The maximum aggregate number of shares of Common Stock reserved for issuance upon exercise of
Options granted under this Plan shall not exceed the sum of (A) 1,500,000 shares, plus (B) an annual increase to be effected on the first day of each of the Company's fiscal years
beginning on January 1, 2003 through and including January 1, 2012 equal to the lesser of (x) 250,000 shares (which sum shall be subject to adjustment pursuant to
Section 10.1) and (y) such amount as determined by the Board of Directors from time to time. Notwithstanding the foregoing, in no event shall the number of shares available under this
Plan 

3

 

be increased to the extent such increase, in addition to the number of shares available for issuance under all other employee or director stock plans, would result in the total number of shares then
available for issuance under all employee or director stock plans exceeding 20% of the outstanding shares of the Company on the first day of the applicable fiscal year. 

        Shares
issued under this Plan shall be drawn from authorized and unissued shares of Common Stock. If any Option granted under this Plan shall expire or terminate for any reason without
having been exercised in full, the unpurchased shares subject to such Option shall be returned to the Plan and become available for issuance in connection with future grant of Options under the Plan. 

SECTION 5.    ELIGIBILITY  

        Options may be granted under the Plan only to persons who are, as of the Grant Date, officers, directors, Employees, consultants, agents, advisors and independent
contractors of the Company and/or its Subsidiaries, as the Plan Administrator from time to time selects. To the extent required for compliance with the policies of the TSX Venture Exchange applicable
to the Company, in connection with the grant of options to any officer, employee or consultant, the resolutions of the Plan Administrator shall include a representation that such optionee is a bona
fide officer, employee or consultant of the Company. In granting Options to consultants, agents, advisors and independent contractors, the Plan Administrator may give consideration to the requirements
set forth in Rule 701 promulgated under the Securities Act. A member of the Board may be eligible to participate in or receive or hold Options under this Plan; provided, however, that no member
of the Board shall vote with respect to the granting of an Option to himself or herself. 

SECTION 6.    GRANTS OF OPTIONS  

        6.1    Form and Grant of Options.    The Plan Administrator shall have the authority, in its sole discretion, to
determine the type or types of Options to be made under the Plan, whether Incentive Stock Options or Nonqualified Stock Options, which shall be appropriately designated. Options may be granted singly
or in combination. An eligible person may receive one or more grants of Options as the Plan Administrator shall from time to time determine, and such determinations may be different as to different
Holders and may vary as to different grants, even when made simultaneously. 

        6.2    Terms and Conditions of Options; Written Agreements.    Options granted under this Plan shall be evidenced by
written agreements which shall contain such terms, conditions, limitations and restrictions as the Plan Administrator shall deem advisable and which are not inconsistent with this Plan. Each
option agreement shall clearly indicate whether the Option granted thereby is an Incentive Stock Option or a Nonqualified Stock Option. Notwithstanding the foregoing, all such agreements evidencing
Options shall include or incorporate by reference the following terms and conditions: number of shares, exercise price, vesting schedule, term and termination. 

        6.3    Number of Shares; Per-Participant Limit.    The maximum number of shares that may be purchased
pursuant to the exercise of each Option shall be as established by the Plan Administrator. Provided, however, to the extent required for compliance with the exclusion from the limitation on
deductibility of compensation under Section 162(m) of the Code and/or as required for compliance with the policies of the TSX Venture Exchange applicable to the Company, the Plan Administrator
shall not grant Options to any person in any one fiscal year of the Company in an amount that exceeds, in the aggregate, the lesser of (A) 1,000,000 shares of Common Stock or (B) five
percent of the total number of issued and outstanding shares of Common Stock as of the date of grant (subject to adjustment as provided in Section 10). 

        6.4    Option Exercise Price.    The price per share at which an Option is exercisable shall be as established by the
Plan Administrator, provided that the exercise price for any Incentive Stock Option 

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shall not be less than 100% of the Fair Market Value of the Common Stock on the Grant Date (subject further to Section 8.2 below). The exercise price of Nonqualified Stock Options shall be not
less than 85% of the Fair Market Value of the Common Stock on the Grant Date. 

        6.5    Term of Options.    Subject to the restrictions contained in Sections 8.2 and 9, the term of each Option shall
be as established by the Plan Administrator or, if not so established, shall be ten years from the Grant Date; provided, however that to the extent required by the policies of the TSX Venture Exchange
applicable to the Company, the maximum term for any Option shall not exceed five years. 

        6.6    Vesting / Exercisability of Options.    The Plan Administrator shall establish and set forth in each agreement
that evidences an Option the time at which or the installments in which, if any, the Option shall vest and become exercisable. To the extent required by the policies of the TSX Venture Exchange
applicable to the Company, the minimum vesting period for Options shall be over a period of not less than 18 months. In the absence of a defined vesting schedule in the agreement evidencing the
Option, the Option covered by such agreement will vest and become exercisable over a period of 18 months from the Grant Date at the following rate: 25% shall vest on the Grant Date and an
additional 25% shall vest on each six month anniversary of the Grant Date. The Plan Administrator, in its absolute discretion, may waive or accelerate any vesting requirement contained in outstanding
and unexercised Options. 

        6.7    Acquired Company Options.    Notwithstanding anything in the Plan to the contrary, the Plan Administrator may
grant Options under the Plan in substitution for options granted under other plans, or assume under the Plan options granted under other plans, if the other plans are or were plans of other acquired
entities ("Acquired Entities") (or the parent of the Acquired Entity) and the new option
is substituted, or the old option is assumed, by reason of a merger, consolidation, acquisition of property or of stock, reorganization or liquidation (the "Acquisition
Transaction"). In the event that a written agreement pursuant to which the Acquisition Transaction is completed is approved by the Board and such agreement sets forth the terms
and conditions of the substitution for or assumption of outstanding options of the Acquired Entity, such terms and conditions shall be deemed to be the action of the Plan Administrator without any
further action by the Plan Administrator, except as may be required for compliance with Rule 16b-3 under the Exchange Act, and the persons holding such Options shall be deemed to be
Holders. 

SECTION 7.    EXERCISE OF OPTIONS  

        Options shall be exercised in accordance with the following terms and conditions: 

        7.1    Procedure.    To the extent that an Option has vested and is currently exercisable, an Option may be exercised
from time to time by written notice to the Company, in accordance with procedures established by the Plan Administrator, setting forth the number of shares with respect to which the Option is being
exercised and accompanied by payment in full of the exercise price as described in Section 7.2. The Plan Administrator may determine at any time that an Option may not be exercised as to less
than 100 shares at any one time (or the lesser number of remaining shares covered by the Option). Only whole shares shall be issued pursuant to the exercise of any Option. 

        7.2    Payment of Exercise Price.    

        (a)  The
exercise price for shares purchased under an Option shall be paid in full to the Company by delivery of consideration equal to the product of the Option exercise
price and the number of shares being purchased. Such consideration must be paid in any combination of cash and/or bank-certified or cashier's check (or personal check if determined
acceptable by the Plan Administrator in its sole discretion), either at the time the Option is granted or within three days after notice of exercise is tendered to the Company. 

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        (b)  In
addition, to the extent permitted by the Plan Administrator in its sole discretion, the exercise price for shares purchased under an Option may be paid, either singly
or in combination with one or more of the alternative forms of payment authorized by this Section 7.2, by (y) delivery of a full-recourse promissory note or (z) such
other consideration as the Plan Administrator may permit. The terms of any such promissory note, including the interest rate, terms of and security for repayment, and maturity, will be subject to the
Plan Administrator's discretion. Any such promissory note shall bear interest at a rate specified by the Plan Administrator but in no case less than the rate required to avoid imputation of interest
(taking into account any exceptions to the imputed interest rules) for federal income tax purposes. 

        (c)  If
and so long as the Common Stock is registered under Section 12 of the Exchange Act, then, to the extent permitted by applicable laws and regulations
(including, but not limited to, federal tax and securities laws and regulations) and unless the Plan Administrator determines otherwise, an Option also may be exercised by (a) delivery of
shares of Common Stock (which shares, if tendered by an affiliate of the Company, shall have been held by the Holder for at least six months) having a Fair Market Value equal to the aggregate exercise
price (such payment in stock may occur in the context of a single exercise of an option or successive and simultaneous exercises, sometimes referred to as "pyramiding," which provides that, rather
than physically exchanging certificates for a series of exercises, bookkeeping entries will be made pursuant to which the Holder is permitted to retain his existing stock certificate and a new stock
certificate is issued for the net shares), or (b) delivery of a properly executed exercise notice together with irrevocable instructions to (i) a brokerage firm acceptable to the Company
to deliver promptly to the Company the aggregate amount of sale or loan proceeds to pay the Option exercise price and any withholding tax obligations that may arise in connection with such exercise,
and (ii) the Company to deliver the certificates for such purchased shares directly to such brokerage firm, all in accordance with the requirements of the Federal Reserve Board. 

        7.3    Withholding Tax Requirements.    The Company may require the Holder to pay to the Company the amount of any
withholding taxes that the Company is required to withhold with respect to the grant, vesting or exercise of any Option. Upon exercise of an Option, the Holder shall, upon notification of the amount
due and prior to or concurrently with the delivery of the certificates representing the shares, pay to the Company all amounts necessary to satisfy applicable federal, state and local withholding tax
requirements or shall otherwise make arrangements satisfactory to the Company for such requirements. If permitted by the Plan Administrator and subject to applicable law, such arrangements may include
payment of the appropriate withholding tax, in whole or in part, by delivery of shares of stock of the Company having a Fair Market Value equal to such withholding tax, either through delivery of
shares held by the Holder or by reduction in the number of shares to be delivered to the Holder upon exercise of such Option. The Company shall have the right to withhold from any shares of Common
Stock issuable pursuant to an Option an amount equal to such taxes. In no event shall the Company issue shares of Common Stock upon exercise of an Option unless the Holder makes sufficient payment, as
determined by the Company, to meet withholding tax obligations on such exercise or other arrangements satisfactory to the Plan Administrator to provide for such payment. 

        7.4    Rights as Shareholder.    Until the issuance (as evidenced by the appropriate entry on the books of the Company
or of a duly authorized transfer agent of the Company) of the stock certificate evidencing such shares, no right to vote or receive dividends or any other rights as a shareholder shall exist with
respect to shares of Common Stock acquired on exercise of an Option, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such stock certificate promptly upon
proper exercise of the Option and payment in full of the aggregate exercise price. In the event that the exercise of an Option is treated in part as the exercise of a Nonqualified Stock Option
(pursuant to the provisions of Section 8.1), the Company shall issue a stock certificate evidencing the 

6

 

shares treated as acquired upon the exercise of an Incentive Stock Option and a separate stock certificate evidencing the shares treated as acquired upon the exercise of a Nonqualified Stock Option,
and shall identify each such certificate accordingly in its stock transfer records. No adjustment will be made for a dividend or other right for which the record date is prior to the date the stock
certificate is issued, except as provided in Section 10 of this Plan. 

SECTION 8.    LIMITATIONS ON INCENTIVE STOCK OPTIONS  

        To the extent required by Section 422 of the Code, Incentive Stock Options shall be subject to the following additional terms and conditions: 

        8.1    Limitation on Amount of Grants to any one Holder.    To the extent that a Holder is granted Incentive Stock
Options that in the aggregate (together with all other Incentive Stock Options granted by the Company or Subsidiaries to such Holder under this Plan and any other stock option plans of the Company)
entitle the Holder to purchase, in any calendar year during which such Options first become exercisable, Common Stock having a Fair Market Value (determined as of the Grant Date) in excess of
$100,000, such portion of the Options in excess of $100,000 shall be treated as a Nonqualified Stock Option. In the event the Holder holds two or more such Options that become exercisable for the
first time in the same calendar year, such limitation shall be applied on the basis of the order in which such Options are granted. 

        8.2    Grants to 10% Shareholders.    Incentive Stock Options may be granted to a person who, at the time the option
is granted, owns more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Subsidiary only if (a) the exercise price per share shall not be
less than 110% of the Fair Market Value of the Common Stock on the Grant Date, and (b) the Option term shall not exceed five years from the Grant Date. The determination of 10% ownership shall
be made by the Plan Administrator, in accordance with Section 422 of the Code. 

        8.3    Eligible Persons.    Only persons who are Employees may receive Incentive Stock Options. Persons who are not
Employees may not be granted Incentive Stock Options and will only be eligible to receive Nonqualified Stock Options. 

        8.4    Term.    The term of an Incentive Stock Option shall not exceed 10 years. 

        8.5    Exercisability.    To qualify for Incentive Stock Option tax treatment, an Option designated as an Incentive
Stock Option must be exercised within three months after termination of employment for reasons other than death, except that, in the case of termination of employment due to Disability, such Option
must be exercised within one year after such termination. Employment shall not be deemed to continue beyond the first 90 days of a leave of absence unless the Holder's reemployment rights are
guaranteed by statute or contract. 

        8.6    Taxation of Incentive Stock Options.    In order to obtain certain tax benefits afforded to Incentive Stock
Options under Section 422 of the Code, the Holder must hold the shares issued upon the exercise of an Incentive Stock Option for (a) at least two years after the Grant Date of the
Incentive Stock
Option and (b) at least one year from the date of exercise. The Plan Administrator may require a Holder to give the Company prompt notice of any disposition of shares acquired upon exercise of
an Incentive Stock Option which occurs prior to the expiration of such holding periods. A Holder may be subject to the alternative minimum tax at the time of exercise of an Incentive Stock Option. 

SECTION 9.    TERMINATION, DISABILITY AND DEATH  

        9.1    General.    The Plan Administrator shall establish and set forth in each agreement that evidences an Option
whether the Option will continue to be exercisable, and the terms and conditions 

7

 

of such exercise, if a Holder ceases to be employed by, or to provide services to, the Company or its Subsidiaries, which provisions may be waived or modified by the Plan Administrator at any time.
If not so established in the agreement evidencing the Option, the Option will be exercisable according to the following terms and conditions, which may be waived or modified by the Plan Administrator
at any time: 

        (a)  Termination other than Death, Disability or Cause. In case of termination of the Holder's employment or services other
than by reason of death, disability or Cause, the Holder may exercise his or her Options at any time prior to the expiration of 90 days after the date the Holder ceases to be an employee,
director, officer, consultant, agent, advisor or independent contractor of the Company or a Subsidiary (but in no event later than the remaining term of the Option), but only if and to the extent the
Holder was entitled to exercise the option at the date of such termination. A transfer of employment or services between or among the Company and its Subsidiaries shall not be considered a termination
of employment or services. The effect of a Company-approved leave of absence on the terms and conditions of an Option shall be determined by the Plan Administrator, in its sole discretion. 

        (b)  Disability. In case of termination of the Holder's employment or services by reason of the Holder's Disability, the
Holder (or personal representative) may exercise his or her Options at any time prior to the expiration of one year (or, to the extent required by the policies of the TSX Venture Exchange applicable
to the Company, 90 days) after the date of such termination (but in no event later than the remaining term of the Option), but only if and to the extent the Holder was entitled to exercise the
option at the date of such termination. 

        (c)  Death. In the event of the death of a Holder, any Options held may be exercised at any time on or prior to the expiration
of one year after the date of death (but in no event later than the remaining term of the Option), but only if and to the extent the Holder was entitled to exercise the option at the date of his or
her death, and only by the Holder's personal representative (if then subject to administration as part of the Holder's estate) or by the person(s) to whom the Holder's rights under
the Option shall have passed by will or by the applicable laws of descent and distribution or by Holder's Permitted Transferee. 

        (d)  Cause. In case of termination of the Holder's employment or services for Cause, all Options held by Holder or his or her
Permitted Transferee shall automatically terminate upon first notification to the Holder of such termination, unless the Plan Administrator determines otherwise. If a Holder's employment or services
with the Company are suspended pending an investigation of whether the Holder shall be terminated for Cause, all the Holder's rights under any Option likewise shall be suspended during the period of
investigation. 

        9.4    Waiver or Extension of Time Periods.    The Plan Administrator shall have the authority, prior to or within the
times specified in this Section 9 for the exercise of any such Option, to extend such time period or waive in its entirety any such time period to the extent that such time period expires prior
to the expiration of the term of such option. In addition, the Plan Administrator may modify or eliminate the time periods specified in this Section 9 with respect to particular Option grants.
However, no Incentive Stock Option may be exercised after the expiration of ten years from the date such option is granted. If a Holder holding an Incentive Stock Option exercises such Option, by
express permission of the Plan Administrator, after the expiration of the time periods specified in this Section 9, the Option will no longer be treated as an Incentive Stock Option under the
Code and shall automatically be converted into a Nonqualified Stock Option. 

        9.5    Termination of Options.    Any portion of an Option that is not vested and exercisable on the date of
termination of the Holder's employment or services shall terminate on such date, unless the Plan Administrator determines otherwise. In addition, to the extent that any Options of any Holder whose
employment or services have terminated shall not have been exercised within the limited periods 

8

 

prescribed in this Section 9, the Options and all further rights to purchase shares pursuant to such Options shall cease and terminate at the expiration of such period. 

        9.6    No Employment Rights.    Nothing in this Plan or any Option or right granted pursuant hereto shall confer upon
any Holder any right to be continued in the employment or service of the Company or any Subsidiary, or to remain a director thereof or a consultant thereto, or to interfere in anyway with the right of
the Company or any Subsidiary, in its sole discretion, to terminate such Holder's employment or service at any time or to remove the Holder as a director or consultant at any time. 

SECTION 10.    ADJUSTMENTS  

        10.1    Adjustments Upon Changes in Capitalization.    In the event that, at any time or from time to time, a stock
dividend, stock split, reverse stock split, spin-off, combination or exchange of shares, recapitalization, merger, consolidation, distribution to shareholders other than a normal cash
dividend, or other similar change in the Company's corporate or capital structure results in either (a) the outstanding shares of Common Stock, or any securities exchanged therefor or received
in their place, being exchanged for a different number or class of securities of the Company or of any other corporation, or (b) new, different or additional securities of the Company or of any
other corporation being received by the holders of shares of Common Stock, then the Plan Administrator shall make proportional adjustments in (i) the maximum number and kind of securities
subject to the Plan as set forth in Section 4.1, and (ii) the number and kind of securities that are subject to any outstanding Option and the per share price of such securities (but
without any change in the aggregate price to be paid therefore). Notwithstanding the foregoing, a Corporate Transaction shall not be governed by this Section 10.1 but shall be governed by
Section 10.2. 

        10.2    Adjustments upon a Corporate Transaction.    Except as otherwise provided in the agreement that evidences the
Option, in the event of any Corporate Transaction, each Option that is at the time outstanding shall automatically accelerate so that each such Option shall, immediately prior to the specified
effective date for the Corporate Transaction, become 100% vested and exercisable. Such Option shall not so accelerate, however, if and to the extent that such Option is, in connection with the
Corporate Transaction, either to be assumed by the successor corporation or parent thereof (the "Successor Corporation") or to be replaced with a
comparable option for the purchase of shares of the capital stock of the Successor Corporation. The determination of Option comparability shall be made by the Plan Administrator, and its determination
shall be conclusive and binding. Upon the consummation of any Corporate Transaction, all outstanding Options that have not been exercised and that are not assumed shall immediately and automatically
terminate. 

        10.3    Further Adjustment of Options.    Subject to Section 10.2, the Plan Administrator shall have the
discretion, exercisable at any time before a sale, merger, consolidation, reorganization, liquidation or change in control of the Company, as defined by the Plan Administrator, to take such further
action as it determines to be necessary or advisable, and fair and equitable to Holders, with respect to Options. Such authorized action may include (but shall not be limited to) establishing,
amending or waiving the type, terms, conditions or duration of, or restrictions on, Options so as to provide for earlier, later, extended or additional time for exercise, lifting restrictions and
other modifications, and the Plan Administrator may take such actions with respect to all Holders, to certain categories of Holders or only to individual Holders. The Plan Administrator may take such
action before or after granting Options to which the action relates and before or after any public announcement with respect to such sale, merger, consolidation, reorganization, liquidation or change
in control that is the reason for such action. 

        10.4    No Fractional Shares.    In the event of any adjustment in the number of shares covered by any option, any
fractional shares resulting from such adjustment shall be disregarded and each such option shall cover only the number of full shares resulting from such adjustment. 

9

 

        10.5    Determination of Plan Administrator to be Final.    All adjustments made pursuant to this Section 10
shall be made by the Plan Administrator and its determination as to what adjustments shall be made, and the extent thereof, shall be final, binding and conclusive. 

        10.6    Limitations.    The grant of Options will in no way affect the Company's right to adjust, reclassify,
reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets. 

SECTION 11.    RESTRICTIONS ON TRANSFERABILITY  

        11.1    Options granted under this Plan and the rights and privileges conferred hereby shall not be subject to execution, attachment or similar process
and may not be assigned, alienated, pledged, sold, or transferred in any manner (whether by operation of law or otherwise) other than by will or by the laws of descent and distribution. 

        11.2    Notwithstanding
Section 11.1 above, in the case of a Nonqualified Stock Option, a Holder may transfer such Option either (a) pursuant to a "domestic
relations order" (as defined in Section 414 of the Code or Section 206 of the Employment Retirement Income Security Act, or the rules thereunder), or (b) by transfer without the
receipt of consideration by a Holder, subject to such rules as the Plan Administrator may adopt to preserve the purposes of the Plan (including limiting such transfers to transfers by Holders who are
directors or senior executives), to (i) a member of his or her Immediate Family, (ii) a trust solely for the benefit of the Holder and/or his or her Immediate Family, or (iii) a
partnership, corporation or limited liability company whose only partners, shareholders or members are the Holder and/or his or her Immediate Family members (each transferee described in 11.2(a) and
(b) is hereafter referred to as a "Permitted Transferee"). Transfers may be made to Permitted Transferees provided that (A) the Plan
Administrator is notified in advance in writing of the terms and conditions of any proposed transfer and (B) the Plan Administrator determines that the proposed transfer complies with the
requirements of the Plan and the applicable Option agreement. For this purpose, "Immediate Family" means, with respect to a particular Holder, the
Holder's spouse, children and grandchildren (including adopted and stepchildren and grandchildren). 

        11.3    Upon
any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of an Option granted under the Plan or any right or privilege conferred hereunder
contrary to the provisions of the Plan, or upon the sale, levy or any attachment or similar process upon the rights and privileges conferred by an option granted under the Plan, the Option shall
thereupon terminate and become null and void. 

        11.4    The
terms of Options granted under this Plan and transferred in accordance with this Section 11 shall apply to the beneficiaries, executors and administrators of
the Holder and of the Permitted Transferees of the Holder (including the beneficiaries, executors and administrators of the Permitted Transferees), including the right to agree to any amendment of the
applicable Option agreement,
except that Permitted Transferees shall not transfer any Option other than by will or by the laws of descent and distribution. 

        11.5    Options
granted under this Plan, or Options transferred in accordance with this Section 11, are exerciseable during the Holder's lifetime only by the Holder or
its Permitted Transferee (or his or her attorney in fact or guardian). In the event of the death of a Holder or Permitted Transferee, Options may be exercised by such Holder's or Permitted
Transferee's executor or administrator. 

SECTION 12.    SECURITIES REGULATIONS  

        12.1    Compliance with Laws.    Shares shall not be issued with respect to an Option granted under this Plan unless
the exercise of such Option and the issuance and delivery of such shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, any applicable 

10

 

state securities laws, the Securities Act, the Exchange Act, the rules and regulations promulgated thereunder, and the requirements of any stock exchange, national market system, over the counter
system, or any electronic bulletin board, upon which the Common Stock may then be listed, quoted or traded, and shall further be subject to the approval of counsel for the Company with respect to such
compliance. Inability of the Company to obtain from any regulatory body having jurisdiction the authority deemed by the Company's counsel to be necessary for the lawful issuance and sale of any shares
hereunder shall relieve the Company of any liability in respect of the nonissuance or sale of such shares as to which such requisite authority shall not have been obtained. In addition,
notwithstanding anything in the Plan to the contrary, the Board, in its sole discretion, may bifurcate the Plan so as to restrict, limit or condition the use of any provision of the Plan to Holders
who are officers or directors subject to Section 16 of the Exchange Act without so restricting, limiting or conditioning the Plan with respect to other Holders. 

        12.2    Representations by Holder.    As a condition to the exercise of an Option, the Company may require the Holder
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 representation is required by any relevant provision of the laws referred to in Section 12.1 above. At the option of the Company, a stop transfer order
against any shares of stock may be placed on the official stock books and records of the Company, and a legend indicating that the stock may not be pledged, sold or otherwise transferred unless an
opinion of counsel was provided (concurred in by counsel for the Company) stating that such transfer is not in violation of any applicable law or regulation, may be stamped on the stock certificate in
order to assure exemption from registration. The Plan Administrator may also require such other action or agreement by the Holder as may from time to time be necessary to comply with the federal and
state securities laws. 

        12.3    No Registration Required.    The Company shall be under no obligation to any Holder to register for offering
or resale or to qualify for exemption under the Securities Act, or to register or qualify under state securities laws, any shares of Common Stock, security or interest in a security paid or issued
under, or created by, the Plan, or to continue in effect any such registrations or qualifications if made. The Company may issue certificates for shares with such legends and subject to such
restrictions on transfer and stop-transfer instructions as counsel for the Company deems necessary or desirable for compliance by the Company with federal and state securities laws. 

SECTION 13.    LOANS, INSTALLMENT PAYMENTS AND LOAN GUARANTEES  

        To assist a Holder (including a Holder who is an officer or a director of the Company) in acquiring shares of Common Stock pursuant to an Option granted under the
Plan, the Plan Administrator, in its sole discretion, may authorize, either at the Grant Date or at any time before the acquisition of Common Stock pursuant to the Option, (a) the extension of
a full-recourse loan to the Holder by the Company, (b) the payment by the Holder of the purchase price, if any, of the Common Stock in installments, or (c) the guarantee by
the Company of a loan obtained by the Holder from a third party. The terms of any loans, installment payments or loan guarantees, including the interest rate and terms of and security for repayment,
will be subject to the Plan Administrator's discretion. The maximum credit available is the purchase price, if any, of the Common Stock acquired, plus the maximum federal and state income and
employment tax liability that may be incurred in connection with the acquisition. 

SECTION 14.    REPURCHASE RIGHTS  

        The Plan Administrator shall have the discretion to authorize the issuance of unvested shares of Common Stock pursuant to the exercise of an Option. Should the
Holder cease to be employed by or provide services to the Company, then all shares of Common Stock issued upon exercise of an Option 

11

 

which are unvested at the time of cessation of employment or services shall be subject to repurchase at the exercise price paid for such shares. The terms and conditions upon which such repurchase
right shall be exercisable (including the period and procedure for exercise) shall be established by the Plan Administrator and set forth in the agreement evidencing such right. All of the Company's
outstanding repurchase rights under this Section 14 are assignable by the Company at any time. Such rights shall automatically terminate, and all shares subject to such terminated rights shall
immediately vest in full, upon the occurrence of a Corporate Transaction, except to the extent that (a) any such repurchase right is expressly assigned to the Successor Corporation in
connection with the Corporate Transaction, or (b) such termination is precluded by other limitations imposed by the Plan Administrator at the time the repurchase right is issued. The Plan
Administrator shall have the discretionary authority, exercisable either before or after the Holder's cessation of employment or service, to cancel the Company's outstanding repurchase rights with
respect to one or more shares purchased or purchasable by the Holder under an Option and thereby accelerate the vesting of such shares in whole or in part at any time. 

SECTION 15.    AMENDMENT AND TERMINATION OF PLAN  

        15.1    Action by Board of Directors.    The Board may suspend or terminate the Plan, or modify or amend the Plan in
such respects as it shall deem advisable or in order to conform to any changes in law or regulation applicable thereto, or in other respects; provided, however, that, to the extent required for
compliance with Section 422 of the Code or any applicable law or regulation, the Board may not, without further approval by the shareholders of the Company, effect any amendment that will
(a) increase the total number of shares as to which Options may be granted under the Plan, (b) modify the class of persons eligible to receive Options, or (c) change the terms of
the Plan which causes the Plan to lose its qualification as an incentive stock option plan under Section 422(b) of the Code, or (d) otherwise require shareholder approval under any
applicable law, regulation or rule of any stock exchange. In addition, to the extent required by the policies of the TSX Venture Exchange applicable to the Company, disinterested shareholder approval
will be required for any proposed decrease in the exercise price for any Options held by a person who is an insider of the Company as of the date of the proposed amendment. 

        15.2    Action by Shareholders.    The Plan may be terminated, modified or amended by the shareholders of the Company.

        15.3    Automatic Termination.    Unless the Plan shall have been earlier terminated, this Plan shall terminate ten
years from the earlier of (a) the date on which the Plan is adopted by the Board, or (b) the date on which this Plan is approved by the shareholders of the Company. No Option may be
granted after such termination, or during any suspension of this Plan. The amendment or termination of this Plan shall not, without the consent of the Holder, alter or impair any rights or obligations
under any option previously granted under this Plan. 

        15.4    Consent of Holder.    The amendment, suspension or termination of the Plan shall not adversely affect the
rights of a Holder under any Option granted under the Plan, without the consent of such Holder. Any change or adjustment to an outstanding Incentive Stock Option shall not, without the consent of the
Holder, be made in a manner so as to constitute a "modification" that would cause such Incentive Stock Option to fail to continue to qualify as an Incentive Stock Option. 

SECTION 16.    GENERAL  

        16.1    California Residents.    Persons who are residents of the State of California shall be subject to the
additional terms and conditions set forth in Appendix A to the Plan. 

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        16.2    No Trust or Fund.    The Plan is intended to constitute an "unfunded" plan. Nothing contained herein shall
require the Company to segregate any monies or other property, or shares of Common Stock, or to create any trusts, or to make any special deposits for any immediate or deferred amounts payable to any
Holder, and no Holder shall have any rights that are greater than those of a general unsecured creditor of the Company. 

        16.3    Severability.    If any provision of the Plan or any Option is determined to be invalid, illegal or
unenforceable in any jurisdiction, or as to any person, or would disqualify the Plan or any Option under any law deemed applicable by the Plan Administrator, such provision shall be construed or
deemed amended to conform to applicable laws, or, if it cannot be so construed or deemed amended without, in the Plan Administrator's determination, materially altering the intent of the Plan or the
Option, such provision shall be stricken as to such jurisdiction, person or Option, and the remainder of the Plan and any such Option shall remain in full force and effect. 

SECTION 17.    EFFECTIVE DATE  

        This Plan shall become effective on the date of its adoption by the Board and Options may be granted immediately thereafter, but no Option may be exercised under
the Plan unless and until the Plan shall have been approved by the shareholders within 12 months after the date of adoption of the Plan by the Board of Directors. If such approval is not
obtained within such period the Plan and any Options granted shall be null and void. 

        Adopted by the Board of Directors on April 29, 2002 and approved by the Company's shareholders on June 24, 2002.

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PLAN ADOPTION AND AMENDMENTS/ADJUSTMENTS    
  

	Date of Adoption/

Amendment/Adjustment
	 	Section
	 	Effect of Amendment
	 	Date of

Shareholder Approval

14

  

 
 

APPENDIX A
  
    2002 STOCK OPTION PLAN
  
    —FOR CALIFORNIA RESIDENTS ONLY—    
  

        This Appendix to the Jones Soda Co. 2002 Stock Option Plan (the "Plan") shall have application  only to participants who are residents of the State of California. Capitalized terms contained herein shall have the same meanings given to them in the
Plan, unless otherwise provided in this Appendix. Notwithstanding any provision contained in the Plan to the contrary and to the extent required by applicable law, the
following terms and conditions shall apply to all Options granted to residents of the State of California, until such time as the Common Stock becomes a "listed security" under the Securities
Act:

        1.    Nonqualified
Stock Options shall have an exercise price that is not less than 85% of the Fair Market Value of the stock at the time the Option is granted, as determined
by the Board, except that the exercise price shall be 110% of the Fair Market Value in the case of any person who owns stock possessing more than 10% of the total combined voting power of all classes
of stock of the Company or its parent or subsidiary corporations. 

        2.    Options
shall have a term of not more than ten years from the date the Option is granted. 

        3.    Options
shall be nontransferable other than by will or the laws of descent and distribution. Notwithstanding the foregoing, and to the extent permitted by
Section 422 of the Code, the Plan Administrator, in its discretion, may permit distribution of an Option to an inter vivos or testamentary trust in which the Option is to be passed to
beneficiaries upon the death of the trustor (settlor), or by gift to "immediate family" as that term is defined in Rule 16a-1(e) of the Exchange Act. 

        4.    Options
shall become exercisable at the rate of at least 20% per year over five years from the date the Option is granted, subject to reasonable conditions such as
continued employment. However, in the case of an Option granted to officers, directors or consultants of the Company or any of its affiliates, the Option may become fully exercisable, subject to
reasonable conditions such as continued employment, at any time or during any period established by the Company or any of its affiliates. 

        5.    Unless
employment is terminated for Cause, the right to exercise an Option in the event of termination of employment, to the extent that the Participant is otherwise
entitled to exercise an Option on the date employment terminates, shall be: 

        (a)  at
least six months from the date of termination of employment if termination was caused by death or Disability; and 

        (b)  at
least 30 days from the date of termination if termination of employment was caused by other than death or Disability; 

        (c)  but
in no event later than the remaining term of the Option. 

        6.    No
Option may be granted to a resident of California more than ten years after the earlier of the date of adoption of the Plan and the date the Plan is approved by the
shareholders. 

        7.    Any
Option exercised before shareholder approval is obtained shall be rescinded if shareholder approval is not obtained within 12 months before or after the Plan
is adopted. Such shares shall not be counted in determining whether such approval is obtained. 

        8.    The
Company shall provide annual financial statements of the Company to each California resident holding an outstanding Option under the Plan. Such financial statements
need not be audited and need not be issued to key employees whose duties at the Company assure them access to equivalent information. 

A-1

 

        9.    Any
right of repurchase on behalf of the Company in the event of a Holder's termination of employment shall be at a purchase price that is (a) not less than the
Fair Market Value of the securities upon termination of employment, and the right to repurchase shall be exercised for cash or cancellation of purchase money indebtedness for the shares within
90 days of termination of employment (or in the case of securities issued upon exercise of Options after the date of termination, within 90 days after the date of the exercise), and the
right shall terminate when the Company's securities become publicly traded; or (b) at the original purchase price, provided that the right to repurchase at the original purchase price lapses at
the rate of at least 20% of the shares per year over five years from the date the Option is granted (without respect to the date the Option was exercised or became exercisable) and the right to
repurchase shall be exercised for cash or cancellation of purchase money indebtedness for
the shares within 90 days of termination of employment (or in the case of securities issued upon exercise of Options after the date of termination, within 90 days after the date of the
exercise). In addition to the restrictions set forth in clauses (a) and (b), the securities held by an officer, director or consultant of the Company or an affiliate of the Company may be
subject to additional or greater restrictions. 

A-2

QuickLinks

EXHIBIT 10.1

JONES SODA CO. 2002 STOCK OPTION PLAN

PLAN ADOPTION AND AMENDMENTS/ADJUSTMENTS

APPENDIX A 2002 STOCK OPTION PLAN —FOR CALIFORNIA RESIDENTS ONLY—

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