Document:

Exhibit
10.1 

 

 

 

 

 

 

 

 

 

 

 

AEROCENTURY
CORP.

 

2021
EQUITY INCENTIVE PLAN

 

Adopted
by the Board on October 23, 2021

Approved
by the Shareholders on December 29, 2021

Adjusted
for the 5-For-1 Forward Stock Split, Effective December 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

     

     

    

 

AEROCENTURY
CORP.

2021
EQUITY INCENTIVE PLAN

 

Adopted
by the Board on October 23, 2021

Approved
by the Shareholders on December 29, 2021

Adjusted
for the 5-For-1 Forward Stock Split, Effective December 30, 2021

 

The
Board of Directors of AeroCentury Corp. (the “Company”) hereby adopts in its entirety the AeroCentury Corp. 2021 Equity Incentive
Plan (the “Plan”), as of October 23, 2021. Unless otherwise defined, terms with initial capital letters are defined in Section
2 below.

 

SECTION
1

BACKGROUND AND PURPOSE

 

1.1 Background.
The Plan permits the grant of Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights (SARs), Stock Awards and
Restricted Stock Units. 

 

1.2 Purpose
of the Plan. The Plan is intended to attract, motivate and retain the following individuals: (a) employees of the Company or its
Affiliates; (b) consultants who provide significant services to the Company or its Affiliates; and (c) directors of the Company or any
of its Affiliates who are employees of neither the Company nor any Affiliate. The Plan is also designed to encourage stock ownership
by such individuals, thereby aligning their interests with those of the Company’s shareholders.

 

SECTION
2

DEFINITIONS

 

The
following words and phrases shall have the following meanings unless a different meaning is plainly required by the context:

 

2.1 “Administrator”
means, collectively the Board, and/or one or more Committees, and/or one or more executive officers of the Company designated by the
Board to administer the Plan or specific portions thereof.

 

2.2 “Affiliate”
means any corporation or any other entity (including, but not limited to, Subsidiaries, partnerships and joint ventures) controlling,
controlled by, or under common control with the Company.

 

2.3 “Applicable
Law” means the legal requirements relating to the administration of Options, SARs, Stock Awards and Restricted Stock Units
and similar incentive plans under any applicable laws, including but not limited to federal and state employment, labor, privacy and
securities laws, and the Code.

 

2.4 “Award”
means, individually or collectively, a grant under the Plan of Nonqualified Stock Options, Incentive Stock Options, SARs, Stock Awards
and/or Restricted Stock Units.

 

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2.5 “Award
Agreement” means the written agreement setting forth the terms and provisions applicable to each Award granted under the Plan,
including the Grant Date.

 

2.6 “Board”
or “Board of Directors” means the Board of Directors of the Company.

 

2.7 “Change
in Control” means the occurrence of any of the following events:

 

(a) Any
“Person,” as such term is used in Sections 13(d) and 14(d) of the Exchange Act of 1934 (“Exchange Act”), becomes
the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the total voting power represented by the Company’s then outstanding voting securities;

 

(b) The
consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets;

 

(c) The
consummation of a liquidation or dissolution of the Company;

 

(d) The
consummation of a merger or consolidation of the Company with any other Person, other than a merger or consolidation which would result
in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding
or by being converted into voting securities of the surviving entity or its parent) at least fifty percent (50%) of the total voting
power represented by the voting securities of the Company or such surviving entity or its parent outstanding immediately after such merger
or consolidation;

 

(e) Other
events specified by the Administrator in the Participant’s Award Agreement.

 

2.8 “Code”
means the Internal Revenue Code of 1986, as amended. Reference to a specific section of the Code or regulation thereunder shall include
such section or regulation, any valid regulation promulgated under such section, and any comparable provision of any future legislation
or regulation amending, supplementing or superseding such section or regulation.

 

2.9 “Committee”
means the compensation committee of the Board or such other committee satisfying Applicable Laws appointed by the Board to administer
the Plan, in accordance with Section 3 of the Plan.

 

2.10 “Company”
means AeroCentury Corp., a Delaware corporation, or any successor thereto. 

 

2.11 “Consultant”
means any consultant, independent contractor or other person who provides significant services to the Company or its Affiliates or any
employee or affiliate of any of the foregoing, but who is neither an Employee nor a Director.

 

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2.12 “Continuous
Status” as an Employee or Consultant means that a Participant’s employment or service relationship with the Company or
any Affiliate is not interrupted or terminated. “Continuous Status” shall not be considered interrupted in the following
cases: (i) any leave of absence approved by the Company or (ii) transfers between locations of the Company or between the Company and
any Subsidiary or successor. A leave of absence approved by the Company shall include sick leave, military leave or any other personal
leave approved by an authorized representative of the Company. For purposes of Incentive Stock Options, no leave of absence may exceed
ninety (90) days, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If such reemployment is not
so guaranteed, then on the one hundred eighty-first (181st) day of such leave any Incentive Stock Option held by the Participant shall
cease to be treated as an Incentive Stock Option and shall be treated for tax purposes as a Nonqualified Stock Option.

 

2.13 “Corporate
Transaction” means the consummation, in a single transaction or in a series of related transactions, of any one or more of
the following events:

 

(i) a
sale or other disposition of all or substantially all, as determined by the Board, of the consolidated assets of the Company and its
Subsidiaries;

 

(ii) a
sale or other disposition of at least fifty percent (50%) of the outstanding securities of the Company;

 

(iii) a
merger, consolidation or similar transaction following which the Company is not the surviving corporation; or

 

(iv) a
merger, consolidation or similar transaction following which the Company is the surviving corporation but the shares of common stock
outstanding immediately preceding the merger, consolidation or similar transaction are converted or exchanged by virtue of the merger,
consolidation or similar transaction into other property, whether in the form of securities, cash or otherwise.

 

2.14 “Director”
means any individual who is a member of the Board of Directors of the Company or an Affiliate of the Company.

 

2.15 “Disability”
means a permanent and total disability within the meaning of Section 22(e)(3) of the Code, provided that in the case of Awards other
than Incentive Stock Options, the Administrator in its discretion may determine whether a permanent and total disability exists in accordance
with uniform and non-discriminatory standards adopted by the Administrator from time to time.

 

2.16 “Employee”
means any individual who is a common-law employee of the Company or of an Affiliate.

 

2.17 “Exercise
Price” means the price at which a Share may be purchased by a Participant pursuant to the exercise of an Option, and the price
used to determine the number of Shares payable to a Participant upon the exercise of a SAR.

 

2.18 “Fair
Market Value” means the price of a Share on the relevant date, determined by the Committee in good faith on such basis as it
deems appropriate. Notwithstanding the foregoing, in the case of a sale of the Company or disposition by the Company of all or substantially
all of the Company’s assets, Fair Market Value shall immediately, for all purposes of this Plan, be determined by the sale price
of the Company’s common stock or the sale price of its assets less any remaining liabilities.

 

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2.19 “Fiscal
Year” means a fiscal year of the Company.

 

2.20 “Grant
Date” means with respect to an Award, the effective date an Award is granted.

 

2.21 “Incentive
Stock Option” means an Option to purchase Shares, which is designated as an Incentive Stock Option and is intended to meet
the requirements of Section 422 of the Code.

 

2.22 “Individual
Objectives” means as to a Participant, the objective and measurable goals set by a “management by objectives” process
and approved by the Administrator in its discretion.

 

2.23 “Misconduct”
means any of the following: (i) Participant is convicted of, or pleads nolo contendere to, (A) any felony or (B) any misdemeanor involving
fraud or dishonesty; (ii) Participant’s engagement in any gross insubordination, willful malfeasance, fraud, dishonesty or other
conduct or activity in the performance of his or her obligations hereunder or otherwise as an employee or service provider of the Company
that is reasonably likely to cause, or does cause, damage to the business of the Company (or any of its affiliates or subsidiaries),
as determined in good faith by the Board; (iii) Participant’s embezzlement of funds or assets from the Company (or any of its affiliates
or subsidiaries); or (iv) Participant’s willful failure or refusal to perform Participant’s covenants, duties or responsibilities
as a service provider for ten (10) days following written notice from the Company describing such failure or refusal in reasonable detail
or Participant’s violation of any duty of loyalty to the Company or a breach of Participant’s fiduciary duty involving personal
profit.

 

2.24 “Nonemployee
Director” means a Director who is not employed by the Company or an Affiliate.

 

2.25 “Nonqualified
Stock Option” means an option to purchase Shares that is not intended to be an Incentive Stock Option.

 

2.26 “Option”
means an Incentive Stock Option or a Nonqualified Stock Option.

 

2.27 “Participant”
means an Employee, Nonemployee Director or Consultant who has an outstanding Award.

 

2.28 “Plan”
means this AeroCentury Corp. 2021 Equity Incentive Plan, as set forth in this instrument and as hereafter amended from time to time.

 

2.29 “Restricted
Stock Units” means an Award granted to a Participant pursuant to Section 8. An Award of Restricted Stock Units constitutes
a promise to deliver to a Participant a specified number of Shares, or the equivalent value in cash, upon satisfaction of the vesting
requirements set forth in the Award Agreement. Each Restricted Stock Unit represents the right to receive one Share or the equivalent
value in cash.

 

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2.30 “Retirement”
shall mean the voluntary Termination by a Participant when such Participant’s age plus years of service with the Company and/or
Subsidiary equals or exceeds seventy five (75). 

 

2.31 “Section
409A” means Section 409A of the Code, as it has been and may be amended from time to time, and any proposed or final Treasury
Regulations and Internal Revenue Service guidance that has been promulgated or may be promulgated thereunder from time to time, or any
state law equivalent.

 

2.32 “Shares”
means shares of common stock, $0.001 par value, of the Company.

 

2.33 “Stock
Appreciation Right” or “SAR” means an Award granted to a Participant pursuant to Section 6. Upon exercise,
a SAR gives a Participant a right to receive a payment in cash, or the equivalent value in Shares, equal to the difference between the
Fair Market Value of the Shares on the exercise date and the Exercise Price. Both the number of SARs and the Exercise Price are determined
on the Grant Date. For example, assume a Participant is granted 100 SARs at an Exercise Price of $10 and the notice of grant specifies
that the SARs will be settled in Shares. Also assume that the SARs are exercised when the underlying Shares have a Fair Market Value
of $20 per Share. Upon exercise of the SAR, the Participant is entitled to receive 50 Shares [(($20-$10)*100)/$20].

 

2.34 “Stock
Award” means an Award granted to a Participant pursuant to Section 7. A Stock Award constitutes a transfer of ownership of
Shares to a Participant from the Company. A Stock Award may be unrestricted and freely transferable (“Unrestricted Stock”),
or subject to restrictions against transferability, assignment, and hypothecation (“Restricted Stock”). Under the terms of
a Restricted Stock Award, the restrictions against transferability are removed when the Participant has met the specified vesting conditions.
Vesting can be based on continued employment of service over a stated service period, or on the attainment of specified performance objectives.
If employment or service is terminated prior to vesting, the unvested Shares of Restricted Stock revert back to the Company. An Award
of Unrestricted Stock is not subject to vesting conditions.

 

2.35 “Subsidiary”
means any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last
corporation in the unbroken chain then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes
of stock in one of the other corporations in such chain.

 

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SECTION
3

ADMINISTRATION

 

3.1 The
Administrator. The Administrator shall be appointed by the Board of Directors from time to time.

 

3.2 Authority
of the Administrator. It shall be the duty of the Administrator to administer the Plan in accordance with the Plan’s provisions
and in accordance with Applicable Law. The Administrator shall have all powers and discretion necessary or appropriate to administer
the Plan and to control its operation, including, but not limited to, the power to make recommendations to the Board regarding the following:
(a) which Employees, Consultants and Directors shall be granted Awards; (b) the terms and conditions of the Awards, (c) interpretation
of the Plan, (d) adoption of rules for the administration, interpretation and application of the Plan as are consistent therewith and
(e) interpretation, amendment or revocation of any such rules.

 

3.3 Delegation
by the Administrator. The Administrator, in its discretion and on such terms and conditions as it may provide, may delegate all or
any part of its authority and powers under the Plan to one or more Directors.

 

3.4 Decisions
Binding. All determinations and decisions made by the Administrator, the Board and any delegate of the Administrator pursuant to
the provisions of the Plan shall be final, conclusive and binding on all persons, and shall be given the maximum deference permitted
by Applicable Law.

 

SECTION
4

SHARES SUBJECT TO THE PLAN

 

4.1 Number
of Shares. Subject to adjustment, as provided in Section 9.1, the total combined number of Shares and Restricted Stock Units available
for grant at any time under the Plan shall be 1,100,000 Shares. Shares granted under the Plan may be authorized but unissued Shares or
reacquired Shares bought on the market or otherwise.

 

4.2 Lapsed
Awards. If any Award made under the Plan expires, or is forfeited or cancelled, or otherwise exercised without delivery of Shares,
such undelivered Shares shall become available for future Awards under the Plan.

 

4.3 Legal
Compliance. Awards and Shares shall not be issued pursuant to the making or exercise of an Award unless the exercise of Options and
rights and the issuance and delivery of Shares shall comply with Applicable Law, and shall be further subject to the approval of counsel
for the Company with respect to such compliance. Any Award made in violation hereof shall be null and void. 

 

4.4
Investment Representations. As a condition to the exercise of an Option or other right, the Company may require the person exercising
such Option or right to represent and warrant at the time of exercise that the Shares are being acquired 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.

 

SECTION
5

STOCK OPTIONS

 

The
provisions of this Section 5 are applicable to Options granted to Employees, Nonemployee Directors and Consultants. Such Participants
shall also be eligible to receive other types of Awards as set forth in the Plan.

 

5.1 Grant
of Options. Subject to the terms and provisions of the Plan, Options may be granted at any time and from time to time as determined
by the Administrator in its discretion. The Administrator may grant Incentive Stock Options, Nonqualified Stock Options, or a combination
thereof, and the Administrator, in its discretion and subject to Section 4.1, shall determine the number of Shares subject to each Option.

 

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5.2 Award
Agreement. Each Option shall be evidenced by an Award Agreement that shall specify the Exercise Price, the expiration date of the
Option, the number of Shares to which the Option pertains, any conditions to exercise the Option, and such other terms and conditions
as the Administrator, in its discretion, shall determine. The Award Agreement shall also specify whether the Option is intended to be
an Incentive Stock Option or a Nonqualified Stock Option.

 

5.3 Exercise
Price. The Administrator shall determine the Exercise Price for each Option subject to the provisions of this Section 5.3.

 

5.3.1 Nonqualified
Stock Options. Unless otherwise specified in the Award Agreement, in the case of a Nonqualified Stock Option, the per Share exercise
price shall not be less than one hundred percent (100%) of the Fair Market Value of a Share on the Grant Date, as determined by the Administrator.

 

5.3.2 Incentive
Stock Options. The grant of Incentive Stock Options shall be subject to the following limitations:

 

(a) The
Exercise Price of an Incentive Stock Option shall be not less than one hundred percent (100%) of the Fair Market Value of a Share on
the Grant Date; provided, however, that if on the Grant Date, the Employee (together with persons whose stock ownership is attributed
to the Employee pursuant to Section 424(d) of the Code) owns stock possessing more than ten percent (10%) of the total combined voting
power of all classes of stock of the Company or any of its Subsidiaries, the Exercise Price shall be not less than one hundred ten percent
(110%) of the Fair Market Value of a Share on the Grant Date;

 

(b) Incentive
Stock Options may be granted only to persons who are, as of the Grant Date, Employees of the Company or a Subsidiary, and may not be
granted to Nonemployee Directors or Consultants.

 

(c) To
the extent that the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are exercisable for the first
time by the Participant during any calendar year (under all plans of the Company and any parent or Subsidiary) exceeds one hundred thousand
dollars ($100,000), such Options shall be treated as Nonqualified Stock Options. For purposes of this Section 5.3.2(c), Incentive Stock
Options shall be taken into account in the order in which they were granted. The Fair Market Value of the Shares shall be determined
as of the time the Option with respect to such Shares is granted; and

 

(d) In
the event of a Participant’s change of status from Employee to Consultant or Director, an Incentive Stock Option held by the Participant
shall cease to be treated as an Incentive Stock Option and shall be treated for tax purposes as a Nonqualified Stock Option three (3)
months and one (1) day following such change of status.

 

5.3.3 Substitute
Options. Notwithstanding the provisions of Sections 5.3.1 and 5.3.2, in the event that the Company or an Affiliate consummates a
transaction described in Section 424(a) of the Code (e.g., the acquisition of property or stock from an unrelated corporation), persons
who become Employees, Directors or Consultants on account of such transaction may be granted Options in substitution for options granted
by their former employer.

 

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5.4 Expiration
of Options

 

5.4.1 Expiration
Dates. With respect to the “unvested” Shares (as determined under the Participant’s Award Agreement) underlying
a Participant’s Option, such Option shall terminate immediately upon the date Participant ceases his/her Continuous Status as an
Employee or Consultant for any reason. With respect to the “vested” Shares underlying a Participant’s Option, unless
otherwise specified in the Award Agreement, such Option shall terminate as follows upon the earliest to occur:

 

(a) Date
in Award Agreement. The date for termination of the Option set forth in the written Award Agreement;

 

(b) Termination
of Continuous Status as Employee or Consultant. The last day of the three (3)-month period following the date the Participant ceases
his/her Continuous Status as an Employee or Consultant (other than termination for a reason described in subsections (c), (d), (e), or
(f) below);

 

(c) Misconduct.
In the event a Participant’s Continuous Status as an Employee or Consultant terminates because the Participant has performed an
act of Misconduct as determined by the Administrator, all unexercised Options held by such Participant shall expire upon the Participant’s
receipt of written notice from the Company of such termination due to Misconduct;

 

(d) Disability.
In the event that a Participant’s Continuous Status as an Employee or Consultant terminates as a result of the Participant’s
Disability, the Participant may exercise his or her Option at any time within one hundred eighty (180) days from the date of such termination
(but in no event later than the expiration of the term of such Option as set forth in the Award Agreement);

 

(e) Death.
In the event of the death of a Participant, the Option may be exercised at any time within three hundred sixty (360) days following the
date of death (but in no event later than the expiration of the term of such Option as set forth in the Award Agreement), by the Participant’s
estate or by a person who acquired the right to exercise the Option by bequest or inheritance;

 

(f) Retirement.
In the event a Participant’s Retirement, the Option may be exercised at any time prior to the Maximum Expiration Date (as defined
in Section 5.4.1(f)) of such Option; or

 

(g) Maximum
Expiration Date. Unless otherwise specified above, an Option shall expire no more than ten (10) years from the Grant Date; provided,
however, that if an Incentive Stock Option is granted to an Employee who, together with persons whose stock ownership is attributed to
the Employee pursuant to Section 424(d) of the Code, owns stock possessing more than ten percent (10%) of the total combined voting power
of all classes of the stock of the Company or any of its Subsidiaries, such Incentive Stock Option may not be exercised after the expiration
of five (5) years from the Grant Date.

 

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5.4.2 Change
in Status. In the event a Participant’s status has changed from Consultant to Employee, or vice versa, a Participant’s
Continuous Status as an Employee or Consultant shall not automatically terminate solely as a result of such change in status.

 

5.4.3 Administrator
Discretion. Notwithstanding the foregoing the Administrator may, after an Option is granted, extend the maximum term of the Option
(subject to limitations applicable to Incentive Stock Options).

 

5.5 Exercisability
of Options. Options granted under the Plan shall be exercisable at such times and be subject to such restrictions and conditions
as the Administrator shall determine in its discretion, as set forth in the Award Agreement. After an Option is granted, the Administrator,
in its discretion, may accelerate the exercisability of the Option.

 

5.6 Exercise
and Payment. Options shall be exercised by the Participant’s delivery of a written notice of exercise to the Secretary of the
Company (or its designee), setting forth the number of Shares with respect to which the Option is to be exercised, accompanied by full
payment for the Shares and satisfaction of all applicable tax withholding.

 

5.6.1 Form
of Consideration. Upon the exercise of any Option, the Exercise Price shall be payable to the Company in full in cash or its equivalent.
The Administrator, in its discretion, also may permit the exercise by tendering previously acquired Shares having an aggregate Fair Market
Value at the time of exercise equal to the total Exercise Price, or by any other means which the Administrator, in its discretion, determines
to provide legal consideration for the Shares, and to be consistent with the purposes of the Plan.

 

5.6.2 Delivery
of Shares. Unless otherwise specified in the Award Agreement, shares acquired by Participant pursuant to the exercise of an Option
shall be held by the Company as escrow agent.

 

SECTION
6

STOCK APPRECIATION RIGHTS

 

6.1 Grant
of SARs. Subject to the terms of the Plan, a SAR may be granted to Employees, Nonemployee Directors and Consultants at any time and
from time to time as shall be determined by the Administrator.

 

6.1.1 Number
of Shares. The Administrator shall have complete discretion to determine the number of SARs granted to any Participant.

 

6.1.2 Exercise
Price and Other Terms. The Administrator, subject to the provisions of the Plan, shall have discretion to determine the terms and
conditions of SARs granted under the Plan, including whether upon exercise the SARs will be settled in Shares or cash. However, the Exercise
Price of a SAR shall be not less than one hundred percent (100%) of the Fair Market Value of a Share on the Grant Date.

 

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6.2 Exercise
of SARs. SARs shall be exercisable on such terms and conditions as the Administrator, in its discretion, shall determine.

 

6.3 SAR
Agreement. Each SAR grant shall be evidenced by an Award Agreement that shall specify the Exercise Price, the term of the SAR, the
conditions of exercise and such other terms and conditions as the Administrator shall determine.

 

6.4 Expiration
of SARs. A SAR granted under the Plan shall expire upon the date determined by the Administrator in its discretion as set forth in
the Award Agreement, or otherwise pursuant to the provisions relating to the expiration of Options as set forth in Section 5.4.

 

6.5 Payment
of SAR Amount. Upon exercise of a SAR, a Participant shall be entitled to Shares, or the equivalent value in cash, from the Company
in an amount determined by dividing the Fair Market Value of a Share on the exercise date by the following: (a) the difference between
the Fair Market Value of a Share on the date of exercise over the SAR Exercise Price, times (b) the number of Shares with respect to
which the SAR is exercised. If the Administrator designates in the Award Agreement that the SAR will be settled in cash, upon Participant’s
exercise of the SAR the Company shall make a cash payment to Participant as soon as reasonably practical.

 

SECTION
7

STOCK AWARDS

 

7.1 Grant
of Award. Subject to the terms and provisions of the Plan, the Administrator, at any time and from time to time, may grant Stock
Awards to Employees, Nonemployee Directors and Consultants in such amounts as the Administrator, in its discretion, shall determine.
Stock Awards may be granted as either Restricted Stock, subject to vesting conditions and other restrictions, or Unrestricted Stock.
The Administrator shall determine the form of Stock Award and the number of Shares to be granted to each Participant. Unrestricted Stock
Awards shall be evidenced by a Notice of Grant, while Restricted Stock Awards shall be evidenced by a Restricted Stock Award Agreement.

 

7.2 Restricted
Stock Agreement. Each Award of Restricted Stock shall be evidenced by an Award Agreement that shall specify the Period of Restriction,
the number of Shares granted, and such other terms and conditions as the Administrator, in its discretion, shall determine. Unless the
Administrator determines otherwise, Shares of Restricted Stock shall be held by the Company as escrow agent until the restrictions on
such Shares have lapsed.

 

7.3 Vesting
and Forfeiture of Restricted Stock Awards. The Administrator, in its discretion, shall impose vesting conditions on Shares of Restricted
Stock as it may deem advisable or appropriate. Shares of Restricted Stock that are not vested shall be forfeited upon the termination
of Participant’s Continuous Status as an Employee, Nonemployee Director or Consultant.

 

7.3.1 Vesting
Conditions. The Administrator may set restrictions based upon the achievement of vesting Conditions that are based on specific performance
objectives (Company-wide, business unit, or individual), or any other basis determined by the Administrator in its discretion.

 

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7.3.2 Legend
on Certificates. The Administrator, in its discretion, may legend the certificates representing Restricted Stock to give appropriate
notice of such restrictions.

 

7.4 Removal
of Restrictions. The Administrator, in its discretion, may accelerate the time at which any restrictions shall lapse or be removed.
Upon satisfaction of the vesting conditions applicable to the Period of Restriction, the Shares shall no longer be subject to forfeiture.

 

7.5 Dividends
and Other Distributions. During the Period of Restriction, Participants holding Shares of Restricted Stock shall be entitled to receive
all dividends and other distributions paid with respect to such Shares unless otherwise provided in the Award Agreement. If any such
dividends or distributions are paid in Shares, the Shares shall be subject to the same restrictions on transferability and forfeitability
as the Shares of Restricted Stock with respect to which they were paid.

 

7.6 Return
of Restricted Stock to Company. On the date set forth in the Award Agreement, the Restricted Stock for which restrictions have not
lapsed shall revert to the Company and again shall become available for grant under the Plan.

 

SECTION
8

RESTRICTED STOCK UNITS

 

8.1 Grant
of Restricted Stock Units. Subject to the terms and conditions of the Plan, Restricted Stock Units may be granted to Employees, Nonemployee
Directors and Consultants at any time and from time to time, as shall be determined by the Administrator in its sole and absolute discretion.

 

8.1.1 Number
of Restricted Stock Units. The Administrator will have complete discretion in determining the number of Restricted Stock Units granted
to any Participant under an Award Agreement, subject to the limitations in Section 4.1.

 

8.1.2 Value
of a Restricted Stock Unit. Each Restricted Stock Unit granted under an Award Agreement represents the right to receive one Share,
or the equivalent value in cash, upon satisfaction of the vesting conditions specified in the Award Agreement.

 

8.2 Vesting
Conditions. In its sole and absolute discretion, the Administrator will set the vesting provisions, which may include any combination
of time-based or performance-based vesting conditions.

 

8.3 Form
and Timing of Payment. The Administrator shall specify in the Award Agreement whether the Restricted Stock Units shall be settled
in Shares or cash. In either case, upon vesting, payment will be made as soon as reasonably practical upon satisfaction of the vesting
conditions.

 

8.4 Cancellation
of Restricted Stock Units. On the earlier of the cancellation date set forth in the Award Agreement or upon the termination of Participant’s
Continuous Status as an Employee, Nonemployee Director or Consultant, all unvested Restricted Stock Units will be forfeited to the Company,
and again will be available for grant under the Plan.

 

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SECTION
9

ADJUSTMENTS UPON CHANGES IN COMMON STOCK;

OTHER CORPORATE EVENTS

 

9.1 Adjustments.
In the event that any dividend or other distribution (whether in the form of cash, common stock, other securities, or other property),
recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, reclassification,
repurchase, or exchange of common stock or other securities of the Company, or other change in the corporate structure of the Company
affecting the Shares occurs (other than any ordinary dividends or other ordinary distributions), the Board, in order to prevent diminution
or enlargement of the benefits or potential benefits intended to be made available under the Plan, will adjust the number and class of
shares of stock that may be delivered under the Plan and/or the number, class, and price of shares of stock covered by each outstanding
Award, and the numerical Share limits in Section 4.1 of the Plan.

 

9.2 Dissolution
or Liquidation. In the event of a proposed dissolution or liquidation of the Company, the Administrator will notify each Participant
as soon as practicable prior to the effective date of such proposed transaction. To the extent it has not been previously exercised,
an Award will terminate immediately prior to the consummation of such proposed action.

 

9.3 Corporate
Transaction. 

 

9.3.1 The
following provisions will apply to Awards in the event of a Corporate Transaction unless otherwise provided in the instrument evidencing
the Award or any other written agreement between the Company or any Affiliate and the Participant or unless otherwise expressly provided
by the Administrator at the time of grant of an Award. In the event of a Corporate Transaction, then, notwithstanding any other provision
of the Plan, the Administrator will take one or more of the following actions with respect to Awards, contingent upon the closing or
completion of the Corporate Transaction:

 

(i) arrange
for the surviving corporation or acquiring corporation (or the surviving or acquiring corporation’s parent company) to assume or
continue the Award or to substitute a similar Award for the Award (including, but not limited to, an award to acquire the same consideration
paid to the shareholders of the Company pursuant to the Corporate Transaction);

 

(ii)
 arrange for the assignment of any reacquisition or repurchase rights held by the Company in respect of the Shares issued pursuant
to the Award to the surviving corporation or acquiring corporation (or the surviving or acquiring corporation’s parent company);

 

(iii)
 accelerate the vesting, in whole or in part, of the Award (and, if applicable, the time at which the Award may be exercised) to
a date prior to the effective time of such Corporate Transaction as the Administrator determines (or, if the Administrator does not determine
such a date, to the date that is five (5) days prior to the effective date of the Corporate Transaction), with such Award terminating
if not exercised (if applicable) at or prior to the effective time of the Corporate Transaction in accordance with the exercise procedures
determined by the Administrator;

 

    PAGE 13

     

    

 

(iv)
 arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held by the Company with respect to the Award;

 

(v)
 cancel or arrange for the cancellation of the Award, to the extent not vested or not exercised prior to the effective time of the
Corporate Transaction, in exchange for no consideration ($0) or such consideration, if any, as determined by the Administrator; or

 

(vi)
 cancel or arrange for the cancellation of the Award, to the extent not vested or not exercised prior to the effective time of the
Transaction, in exchange for a payment, in such form as may be determined by the Administrator, equal to the excess, if any, of (A),
the per share amount (or value of property per share) payable to holders of the Shares in connection with the Corporate Transaction,
over (B) the per share exercise price under the applicable Award, multiplied by the number of Shares subject to the Award. For clarity,
this payment may be $0 if the amount per share (or value of property per share) payable to the holders of the Shares is equal to or less
than the per share exercise price of the Award. In addition, any escrow, holdback, earn out or similar provisions in the definitive agreement
for the Corporate Transaction may apply to such payment to the holder of the Award to the same extent and in the same manner as such
provisions apply to the holders of the Shares.

 

The
Administrator need not take the same action or actions with respect to all Awards or portions thereof or with respect to all Participants.

 

9.3.2 Appointment
of Shareholder Representative. As a condition to the receipt of an Award under this Plan, a Participant will be deemed to have agreed
that the Award will be subject to the terms of any agreement governing a Corporate Transaction involving the Company, including, without
limitation, a provision for the appointment of a shareholder representative that is authorized to act on the Participant’s behalf
with respect to any escrow, indemnities and any contingent consideration.

 

9.4 No
Restriction on Right to Undertake Transactions. The grant of any Award under the Plan and the issuance of shares pursuant to any
Award does not affect or restrict in any way the right or power of the Company or the shareholders of the Company to make or authorize
any adjustment, recapitalization, reorganization or other change in the Company’s capital structure or its business, any merger
or consolidation of the Company, any issue of stock or of options, rights or options to purchase stock or of bonds, debentures, preferred
or prior preference stocks whose rights are superior to or affect the Shares or the rights thereof or which are convertible into or exchangeable
for the Shares, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business,
or any other corporate act or proceeding, whether of a similar character or otherwise.

 

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9.5
 Acceleration Rights. An Award may be subject to additional acceleration of vesting and exercisability upon or after a Change
in Control as may be provided in the Award Agreement for such Award or as may be provided in any other written agreement between the
Company or any Affiliate and the Participant, but in the absence of such provision, no such acceleration will occur.

 

9.6 Section
409A Limitations. Notwithstanding anything in this Section 9 to the contrary, if a payment under an Award is subject to Section 409A
and if the change in control definition contained in the Award Agreement or other written agreement related to the Award does not comply
with the definition of “change in control” for purposes of a distribution under Section 409A, then any payment of an amount
that otherwise is accelerated under this Section will be delayed until the earliest time that such payment would be permissible under
Section 409A without triggering any penalties applicable under Section 409A.

 

SECTION
10

MISCELLANEOUS

 

10.1 No
Effect on Employment or Service. Nothing in the Plan shall interfere with or limit in any way the right of the Company or an Affiliate
to terminate any Participant’s employment or service at any time, with or without cause. Unless otherwise provided by written contract,
employment or service with the Company or any of its Affiliates is on an at-will basis only. Additionally, the Plan shall not confer
upon any Nonemployee Director any right with respect to continuation of service as a Director or nomination to serve as a Director, nor
shall it interfere in any way with any rights which such Nonemployee Director or the Company may have to terminate his or her directorship
at any time.

 

10.2 Participation.
No Employee or Consultant shall have the right to be selected to receive an Award under this Plan, or, having been so selected, to be
selected to receive a future Award.

 

10.3 Successors.
All obligations of the Company under the Plan, with respect to Awards granted hereunder, shall be binding on any successor to the Company,
whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation or, otherwise, sale or
disposition of all or substantially all of the business or assets of the Company.

 

10.4 Beneficiary
Designations. If permitted by the Administrator, a Participant under the Plan may name a beneficiary or beneficiaries to whom any
vested but unpaid Award shall be paid in the event of the Participant’s death. Each such designation shall revoke all prior designations
by the Participant and shall be effective only if given in a form and manner acceptable to the Administrator. In the absence of any such
designation, any vested benefits remaining unpaid at the Participant’s death shall be paid to the Participant’s estate and,
subject to the terms of the Plan and of the applicable Award Agreement, any unexercised vested Award may be exercised by the administrator
or executor of the Participant’s estate.

 

10.5 Limited
Transferability of Awards. Unless the Administrator provides otherwise, no Award granted under the Plan may be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. All rights
with respect to an Award granted to a Participant shall be available during his or her lifetime only to the Participant. Notwithstanding
the foregoing, the Participant may, in a manner specified by the Administrator, (a) transfer a Nonqualified Stock Option to a Participant’s
spouse, former spouse or dependent pursuant to a court-approved domestic relations order which relates to the provision of child support,
alimony payments or marital property rights and (b) transfer a Nonqualified Stock Option by bona fide gift and not for any consideration
to (i) a member or members of the Participant’s immediate family, (ii) a trust established for the exclusive benefit of the Participant
and/or member(s) of the Participant’s immediate family, (iii) a partnership, limited liability company or other entity whose only
partners or members are the Participant and/or member(s) of the Participant’s immediate family or (iv) a foundation in which the
Participant and/or member(s) of the Participant’s immediate family control the management of the foundation’s assets.

 

    PAGE 15

     

    

 

10.6 Restrictions
on Share Transferability. The Administrator may impose such restrictions on any Shares acquired pursuant to the exercise of an Award
as it may deem advisable, including, but not limited to, the requirement to sign a voting rights agreement in favor of the Company as
a condition to the delivery of Shares, restrictions related to applicable federal securities laws, the requirements of any national securities
exchange or system upon which Shares are then listed or traded or any blue sky or state securities laws.

 

10.7 Nonemployee
Director Award Limitations. No Nonemployee Director may be paid, issued, or granted, in any Fiscal Year, equity awards (including
any Awards issued under this Plan) with an aggregate value (the value of which will be based on their grant date fair value determined
in accordance with U.S. generally accepted accounting principles) and any other compensation (including, without limitation, any cash
retainers or fees) that, in the aggregate, exceed $500,000. Any Awards or other compensation paid or provided to an individual for his
or her services as an Employee, or for his or her services as a Consultant (other than as an Nonemployee Director), will not count for
purposes of the limitation under this Section 10.7.

 

10.8 Forfeiture
Events. The Administrator may specify in an Award Agreement that the Participant’s rights, payments, and benefits with respect
to an Award will be subject to reduction, cancellation, forfeiture, recoupment, reimbursement, or reacquisition upon the occurrence of
certain specified events, in addition to any otherwise applicable vesting or performance conditions of an Award. Notwithstanding any
provisions to the contrary under this Plan, an Award will be subject to the Company’s clawback policy as may be established and/or
amended from time to time to comply with Applicable Laws (including, without limitation, pursuant to the listing standards of any national
securities exchange or association on which the Company’s securities are listed or as may be required by the Dodd-Frank Wall Street
Reform and Consumer Protection Act) (the “Clawback Policy”). The Administrator may require a Participant to forfeit, return
or reimburse the Company all or a portion of the Award and any amounts paid thereunder pursuant to the terms of the Clawback Policy or
as necessary or appropriate to comply with Applicable Laws. Unless this Section10.8 specifically is mentioned and waived in an Award
Agreement or other document, no recovery of compensation under a Clawback Policy or otherwise will constitute an event that triggers
or contributes to any right of a Participant to resign for “good reason” or “constructive termination” (or similar
term) under any agreement with the Company or any Subsidiary of the Company.

 

    PAGE 16

     

    

 

SECTION
11

AMENDMENT, SUSPENSION, AND TERMINATION

 

11.1 Amendment,
Suspension, or Termination. Except as provided in Section 11.2, the Board, in its sole discretion, may amend, suspend or terminate
the Plan, or any part thereof, at any time and for any reason. The amendment, suspension or termination of the Plan shall not, without
the consent of the Participant, alter or impair any rights or obligations under any Award theretofore granted to such Participant. No
Award may be granted during any period of suspension or after termination of the Plan.

 

11.2 Shareholder
Approval. The Company shall obtain shareholder approval of any material Plan amendment to the extent desirable to comply with Section
422 of the Code, or other Applicable Law.

 

11.3 Plan
Effective Date and Duration of Awards. The Plan shall be effective upon its adoption by the Board and approval by the shareholders
of the Company (“Effective Date”). The Plan will continue in effect for a term of ten (10) years from the Effective Date,
unless terminate earlier pursuant to Section 11.1.

 

SECTION
12

TAX WITHHOLDING

 

12.1
Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to an Award (or exercise thereof), the Company
shall have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy
federal, state, and local taxes (including the Participant’s FICA obligation) required to be withheld with respect to such Award
(or exercise thereof).

 

12.2
Withholding Arrangements. The Administrator, in its discretion and pursuant to such procedures as it may specify from time to
time, may permit a Participant to satisfy such tax withholding obligation, in whole or in part by (a) electing to have the Company withhold
otherwise deliverable Shares or (b) delivering to the Company already-owned Shares having a Fair Market Value equal to the minimum amount
required to be withheld. The amount of the withholding requirement shall be deemed to include any amount which the Administrator agrees
may be withheld at the time the election is made, not to exceed the amount determined by using the statutory minimum federal, state or
local income tax rates applicable to the Participant with respect to the Award on the date that the amount of tax to be withheld is to
be determined. The Fair Market Value of the Shares to be withheld or delivered shall be determined as of the date taxes are required
to be withheld.

 

12.3
Compliance With Section 409A. Awards will be designed and operated in such a manner that they are either exempt from the application
of, or comply with, the requirements of Section 409A such that the grant, payment, settlement or deferral will not be subject to the
additional tax or interest applicable under Section 409A, except as otherwise determined in the sole discretion of the Administrator.
The Plan and each Award Agreement under the Plan is intended to meet the requirements of Section 409A and will be construed and interpreted
in accordance with such intent, except as otherwise determined in the sole discretion of the Administrator. To the extent that an Award
or payment, or the settlement or deferral thereof, is subject to Section 409A, the Award will be granted, paid, settled or deferred in
a manner that will meet the requirements of Section 409A, such that the grant, payment, settlement or deferral will not be subject to
the additional tax or interest applicable under Section 409A. In no event will the Company or any of its Subsidiaries or Parents have
any obligation or liability under the terms of this Plan to reimburse, indemnify, or hold harmless any Participant or any other person
in respect of Awards, for any taxes, interest, or penalties imposed, or other costs incurred, as a result of Section 409A.

 

    PAGE 17

     

    

 

SECTION
13

LEGAL CONSTRUCTION

 

13.1
Liability of Company. 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 grant or any Award or the issuance and sale of any Shares hereunder,
shall relieve the Company, its officers, Directors and Employees of any liability in respect of the failure to grant such Award or to
issue or sell such Shares as to which such requisite authority shall not have been obtained.

 

13.2
Gender and Number. Except where otherwise indicated by the context, any masculine term used herein also shall include the feminine;
the plural shall include the singular and the singular shall include the plural.

 

13.3
Severability. In the event any provision of the Plan shall be held illegal or invalid for any reason, the illegality or invalidity
shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as if the illegal or invalid provision
had not been included.

 

13.4
Requirements of Law. The granting of Awards and the issuance of Shares under the Plan shall be subject to all applicable laws,
rules, and regulations, and to such approvals by any governmental agencies as may be required.

 

13.5
Governing Law. The Plan and all Award Agreements shall be construed in accordance with and governed by the laws of the State of
California.

 

13.6
Captions. Captions are provided herein for convenience only, and shall not serve as a basis for interpretation or construction
of the Plan.

 

 

PAGE
18Exhibit 10.2

 

QUANTUM COMPUTING INC.

215 Depot Court, SE

Leesburg, VA 20175

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT
(the “Agreement”) is made effective as of the 3rd day of January, 2022 (the “Effective Date”), between William
J. McGann (“Executive”) and Quantum Computing Inc. (the “Company”), a Delaware corporation.

 

WHEREAS, the Company desires
that for the foreseeable future the Executive will serve as the Company’s Chief Operating Officer and Chief Technology Officer (COO
/ CTO) responsible for business operations and all engineering and technology, and the Executive is willing to continue to serve in the
foregoing positions on the terms and conditions set forth in this Agreement;

 

NOW, THEREFORE in consideration
of the mutual covenants and promises contained herein and other good and valuable considerations, the sufficiency of which is hereby acknowledged,
the Company and the Executive hereby agree as follows:

 

1. Effective
Date and Term of Employment. The initial term of this Agreement shall begin on the Effective Date and shall continue until the earlier
of: (a) the date on which it is terminated pursuant to terms of this Agreement; or (b) three (3) years following the Effective Date (the
“Term”).

 

2. Duties
and Responsibilities. The Executive agrees to work for the Company as its Chief Operating Officer and Chief Technology Officer (COO
/ CTO) performing all of the duties and responsibilities inherent in such position. The Executive shall report to the Company’s
Chief Executive Officer (“CEO”) and the Audit Committee of the Board of Directors and shall be subject to the supervision
thereof, and Executive shall have such authority as is delegated by the CEO and the Board, which authority shall be sufficient for Executive
to perform all of the duties of the office referenced herein. The Executive shall devote the Executive’s full business time and
reasonable best efforts in the performance of the foregoing services. Subject to the restrictions set forth in Section 6.4, Executive
may accept other board memberships or service with other organizations that are not in conflict with Executive’s primary responsibilities
and obligations to the Company.

 

3. Compensation
and Benefits.

 

3.1 Salary.
The Company shall pay Executive a base salary of $16,666.67 twice per calendar month (i.e., at an annualized rate of $400,000 per year),
payable in accordance with the Company’s customary payroll practices (the “Base Salary”). The Base Salary thereafter
shall be subject to annual review and adjustment, as determined by the Board (or the Compensation Committee of the Board) in its sole
discretion, provided, however, that the Base Salary may not be decreased without the Executive’s consent unless the compensation
payable to all executives of the Company is also similarly reduced.

 

     

     

    

  

3.2 Stock
Options. The Company will grant to Executive options to purchase 535,000 shares of common stock, which shall vest as follows (i) 178,333
options shall vest immediately upon grant (ii) 178,333 options shall vest on the 12-month anniversary of the date of grant (iii), 178,334
options shall vest on the 24-month anniversary of the date of grant The stock options will be granted in a separate document, which will
set forth the terms and conditions of the option grant.

 

3.3 Annual
Incentive. For the fiscal year ending December 31, 2022 and in subsequent fiscal years, Executive will be eligible to receive an annual
cash bonus in an amount up to thirty seven and one half percent (37.5%) of Base Salary, subject to Executive achieving the performance
milestones that are established and approved by the Board of Directors within 60 days following the beginning of such fiscal year, as
set forth on Exhibit A, hereto. The bonus, if payable, shall be calculated and paid within 30 days after the end of the fiscal year in
which such bonus was earned; provided, however, that the Company may delay the calculation and payment of any portion of
such bonus which is based on the attainment of a revenue, earnings or similar milestone until the completion of the audit of the Company’s
financial statements for the fiscal year in question.

 

3.4 Long-Term
Incentives. The Company may from time to time establish incentive programs, including but not limited to stock options, and the Executive
will be eligible to participate in such incentive programs under terms to be set when such programs are approved by the Board and Shareholders.

 

3.5 Fringe
Benefits. Executive shall be entitled to participate in all bonus and benefit programs that the Company establishes and makes available
to its executive employees, if any, to the extent that Executive’s position, tenure, salary, age, health and other qualifications
make Executive eligible to participate, including, but not limited to health care plans, short and long term disabilities plans, life
insurance plans, retirement plans, and all other benefit plans from time to time in effect. Executive shall also be entitled to take four
(4) weeks of fully paid annual leave in accordance with Company policy.

 

3.6 Reimbursement
of Certain Expenses. Executive shall be reimbursed for such reasonable and necessary business expenses incurred by Executive while
Executive is employed by the Company, which are directly related to the furtherance of the Company’s business, including compensation
under the Company’s standard policies if Executive uses his personal vehicle for Company business where such business is more than
one hundred fifty (150) miles from the Company’s main offices or Executive’s home, wherever such trip commences. 
The Executive must submit any request for reimbursement no later than fifteen (15) days following the date that such business expense
is incurred in accordance with the Company’s reimbursement policy regarding same and business expenses must be substantiated by
appropriate receipts and documentation.  The Company may request additional documentation or a further explanation to substantiate
any business expense submitted for reimbursement, and retains the discretion to approve or deny a request for reimbursement. If a business
expense reimbursement is not exempt from Section 409A of the Code, any reimbursement in one calendar year shall not affect the
amount that may be reimbursed in any other calendar year and a reimbursement (or right thereto) may not be exchanged or liquidated
for another benefit or payment.  Any business expense reimbursements subject to Section 409A of the Code shall be made no later than
the end of the calendar year following the calendar year in which such business expense is incurred by the Executive.

 

    	 	2	 

     

    

  

3.7 Indemnification.
The Company shall continue to indemnify Executive to the fullest extent permitted under applicable law, the Company’s Articles of
Organization and the Company’s By-laws, each as they may be amended from time to time. The Executive shall be insured under the
Company’s Directors’ and Officers’ liability policy in the same manner as other senior executives of the Company for
as long as Executive is an officer or director of the Company and as long as the Company maintains such policy in force. Such indemnity
and insurance shall survive the termination of Executive’s employment by the Company.

 

4. Termination
of Employment Period. Executive’s employment under the terms of this agreement may terminate upon the occurrence of any of the
following:

 

4.1 Termination
for Cause. At the election of the Company, for “Cause,” upon written notice by the Company to Executive. For the purposes
of this Section, “Cause” for termination shall be deemed to exist upon the occurrence of any of the following:

 

(a)  Executive’s
conviction or entry of nolo contendere to any felony or a crime involving moral turpitude, fraud or embezzlement of Company property;
or

 

(b)  Executive’s
dishonesty, gross negligence or gross misconduct that is materially injurious to the Company or material failure to perform her/his duties
under this Agreement which has not been cured by Executive within 10 days after he/she shall have received written notice from the Company
stating with reasonable specificity the nature of such failure to perform; or

 

(c)  Executive’s
illegal use or abuse of drugs, alcohol, or other related substances that is materially injurious to the Company.

 

4.2  Voluntary
Termination by the Company. At the election of the Company, without Cause.

 

4.3  Death
or Disability. Upon the death or disability of Executive. As used in this Agreement, “disability” shall occur when Executive,
due to a physical or mental disability, for a period of 90 days in the aggregate whether or not consecutive, during any 360-day period,
is unable to perform the services contemplated under this Agreement.

 

4.4  Termination
for Good Reason. Subject to the notice and cure periods set forth in Section 5.5, at the election of Executive for “Good Reason”
(as defined below), upon written notice by the Executive to the Company.

 

4.5  Voluntary
Termination by Executive. At the election of Executive, without Good Reason, upon not less than 30 days prior written notice by him/her
to the Company.

 

5.  Effect
of Termination.

 

5.1 Termination
for Cause, at the Election of Executive, or at Death or Disability. In the event that Executive’s employment is terminated for
Cause, the Company shall have no further obligations under this Agreement other than to pay to Executive Base Salary and accrued vacation
through the last day of Executive’s actual employment by the Company. In the event that Executive’s employment is terminated
upon Executive’s death or disability, or at the election of Executive, the Company shall have no further obligations under this
Agreement other than (i) to pay to Executive, in a single lump sum upon such termination, Base Salary and accrued vacation through the
last day of Executive’s actual employment by the Company and (ii) to pay to Executive, in a single lump sum, a pro rata portion
of any bonus (to the extent earned prior to such termination) for the fiscal year in which termination occurs, pursuant to Section 3.2.

 

    	 	3	 

     

    

  

5.2  Voluntary
Termination by the Company, or for Good Reason. In the event that Executive’s employment is terminated during the term of this
Agreement without Cause, or by Executive’s resignation for Good Reason, and Executive executes a release in favor of the Company
substantially in the form annexed hereto as Exhibit B, not later than 30 days after Executive’s employment terminates, and the period
in which Executive is entitled to revoke such release has expired without any such revocation, then the Company shall continue to pay
to Executive the annual Base Salary in effect immediately prior to such termination for the twelve-month period following Executive’s
last day of employment. In addition, the Company shall continue Executive’s coverage under and its contributions towards Executive’s
health care, dental, and life insurance benefits on the same basis as immediately prior to the date of termination, except as provided
below, for the six-month period following Executive’s last day of employment. In addition to the foregoing amounts, the Company
shall pay Executive in a single lump sum, a pro rata portion of any bonus (to the extent earned prior to such termination) for the year
in which termination occurs, pursuant to Section 3.2. Notwithstanding the foregoing, subject to any overriding laws, the Company shall
not be required to provide any health care, dental, or life insurance benefit otherwise receivable by Executive if Executive is actually
covered or becomes covered by an equivalent benefit (at the same cost to Executive, if any) from another source. Any such benefit made
available to Executive shall be reported to the Company.

 

5.3 Notwithstanding
any other provision of this Amended Agreement with respect to the timing of payments under Section 5, if, at the time of the Executive’s
termination, the Executive is deemed to be a “specified employee” of the Company within the meaning of Section 409A(a)(2)(B)(i)
of the Code, then only to the extent necessary to comply with the requirements of Section 409A of the Code, any payments to which the
Executive may become entitled under Section 5 which are subject to Section 409A of the Code (and not otherwise exempt from its application)
will be withheld until the first business day of the seventh month following the date of termination, at which time the Executive shall
be paid an aggregate amount equal to six months of payments otherwise due to the Executive under the terms of Section 5, as applicable.
After the first business day of the seventh month following the date of termination and continuing each month thereafter, the Executive
shall be paid the regular payments otherwise due to the Executive in accordance with the terms of Section 5, as thereafter applicable.

 

5.4 Upon
Executive’s termination without Cause during the term of this Agreement, or as a result of Executive’s resignation for Good
Reason during the term of this Agreement, all stock options granted by the Company and then held by Executive shall be accelerated and
become fully vested and exercisable as of the date of Executive’s termination.

 

5.5  As
used in this Agreement, “Good Reason” means, without Executive’s written consent, (a) a “material diminution”
(as such term is used in Section 409A of the Code) of the duties assigned to Executive (provided, however, that no termination of Executive’s
service as a member of the Board, regardless of the reason therefore, shall constitute a “material diminution” of Executive’s
duties for purposes of this Section 5.5); or (b) a material reduction in Base Salary or other benefits (other than a reduction or change
in benefits generally applicable to all executive employees of the Company); or (c) relocation to an office more than 50 miles further
from Executives current residence in Virginia than the Company’s current location in the greater Washington, DC metropolitan area
is located from such residence; or (d) a “Change of Control” of the Company, as that term is defined in the Control Plan;
or (e), the acquisition (other than an acquisition directly from the Company) by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more of the then outstanding shares of voting stock of
the Company (the “Voting Stock”); provided, however, that any acquisition by the Company or its subsidiaries, or any employee
benefit plan (or related trust) of the Company or its subsidiaries of (i) 50% or more of the then outstanding Voting Stock, or (ii) Voting
Stock which has the effect of increasing the percentage of Voting Stock owned by any such individual, entity or group to 50% or more of
the then outstanding Voting Stock, shall not constitute a Change of Control. In the event Executive resigns for Good Reason within twelve
(12) months after a Change of Control or acquisition, or if the Executive is terminated without cause within twelve (12) months after
a Change of Control or acquisition, as defined in (d) or (e) above, Executive shall receive, in addition to any severance to which he/she
is entitled under § 5.2 of the Employment Agreement as amended, an additional sum equal to twelve (12) months of his/her base salary
then in effect. Notwithstanding the occurrence of any of the events enumerated in this Section 5.5, no event or condition shall be deemed
to constitute Good Reason unless (i) Executive reports the event or condition which the Executive believes to be Good Reason to the Board,
in writing, within 45 days of such event or condition occurring and (ii) within 30 days after the Executive provides such written notice
of Good Reason, the Company has failed to fully correct such Good Reason and to make the Executive whole for any such losses.

 

    	 	4	 

     

    

  

5.6  The
provisions of this Section 5 and the payments provided hereunder are intended to be exempt from or to comply with the requirements of
Section 409A of the Code, and shall be interpreted and administered consistent with such intent. To the extent required for compliance
with Section 409A, references in this Agreement to a “termination of employment” shall mean a “separation of service”
as defined by Section 409A. It is further intended that each installment of the payments provided hereunder shall be treated as a separate
“payment” for purposes of Section 409A. Neither the Company nor Executive shall have the right to accelerate or defer the
delivery of any such payments or benefits except to the extent specifically permitted or required by Section 409A.

 

6.  Nondisclosure
and Noncompetition.

 

6.1 Proprietary
Information.

 

(a)  Executive
agrees that all information and know-how, whether or not in writing, of a private, secret or confidential nature concerning the Company’s
business or financial affairs (collectively, “Proprietary Information”) is and shall be the exclusive property of the Company.
By way of illustration, but not limitation, Proprietary Information may include inventions, products, processes, methods, techniques,
formulas, designs, drawings, slogans, tests, logos, ideas, practices, projects, developments, plans, research data, financial data, personnel
data, computer programs and codes, and customer and supplier lists. Executive will not disclose any Proprietary Information to others
outside the Company except in the performance of his/her duties or use the same for any unauthorized purposes without written approval
by an officer of the Company, either during or after his employment, unless and until such Proprietary Information has become public knowledge
or generally known within the industry without fault by Executive, or unless otherwise required by law.

 

(b) Executive
agrees that all files, letters, memoranda, reports, records, data, sketches, drawings, laboratory notebooks, program listings, or other
written, photographic, electronic or other material containing Proprietary Information, whether created by Executive or others, which
shall come into his custody or possession, shall be and are the exclusive property of the Company to be used by Executive only in the
performance of her/his duties for the Company.

 

(c)  Executive
agrees that his/her obligation not to disclose or use information, know-how and records of the types set forth in paragraphs (a) and (b)
above, also extends to such types of information, know-how, records and tangible property of subsidiaries and joint ventures of the Company,
customers of the Company or suppliers to the Company or other third parties who may have disclosed or entrusted the same to the Company
or to Executive in the course of the Company’s business.

 

6.2  Inventions.

 

(a)  Disclosure.
Executive shall disclose promptly to an officer or to attorneys of the Company in writing any idea, invention, work of authorship, whether
patentable or un-patentable, copyrightable or un-copyrightable, including, but not limited to, any computer program, software, command
structure, code, documentation, compound, genetic or biological material, formula, manual, device, improvement, method, process, discovery,
concept, algorithm, development, secret process, machine or contribution (any of the foregoing items hereinafter referred to as an “Invention”)
Executive may conceive, make, develop or work on, in whole or in part, solely or jointly with others. The disclosure required by this
Section applies (a) to any invention related to the general line of business engaged in by the Company or to which the Company planned
to enter during the period of Executive’s employment with the Company and for one year thereafter; (b) with respect to all Inventions
whether or not they are conceived, made, developed or worked on by Executive during Executive’s regular hours of employment with
the Company; (c) whether or not the Invention was made at the suggestion of the Company; and (d) whether or not the Invention was reduced
to drawings, written description, documentation, models or other tangible form.

 

    	 	5	 

     

    

  

(b) Assignment
of inventions to Company; Exemption of Certain Inventions. Executive hereby assigns to the Company without royalty or any other further
consideration Executive’s entire right, title and interest in and to all Inventions which Executive conceives, makes, develops or
works on during employment and for one year thereafter, except as limited by 6.2(a) above and those Inventions that Executive develops
entirely on Executive’s own time after the date of this Agreement without using the Company’s equipment, supplies, facilities
or trade secret information unless those Inventions either (a) relate at the time of conception or reduction to practice of the Invention
to the Company's business, or actual or demonstrably anticipated research or development of the Company; or (b) result from any work performed
by Executive for the Company.

 

(c)  Records.
Executive will make and maintain adequate and current written records of all Inventions. These records shall be and remain the property
of the Company.

 

(d)  Patents.
Executive will assist the Company in obtaining, maintaining and enforcing patents and other proprietary rights in connection with any
Invention covered by Section 6.2. Executive further agrees that his obligations under this Section shall continue beyond the termination
of his employment with the Company, but if he is called upon to render such assistance after the termination of such employment, he shall
be entitled to a fair and reasonable rate of compensation for such assistance. Executive shall, in addition, be entitled to reimbursement
of any expenses incurred at the request of the Company relating to such assistance.

 

6.3 Prior Contracts
and Inventions; Information Belonging to Third Parties. Executive represents that there are no contracts to assign Inventions between
any other person or entity and Executive. Executive further represents that (a) Executive is not obligated under any consulting, employment
or other agreement which would affect the Company’s rights or my duties under this Agreement, (b) there is no action, investigation,
or proceeding pending or threatened, or any basis therefor known to me involving Executive’s prior employment or any consultancy
or the use of any information or techniques alleged to be proprietary to any former employer, and (c) the performance of Executive’s
duties as an employee of the Company will not breach, or constitute a default under any agreement to which Executive is bound, including,
without limitation, any agreement limiting the use or disclosure of proprietary information acquired in confidence prior to engagement
by the Company. Executive will not, in connection with Executive’s employment by the Company, use or disclose to the Company any
confidential, trade secret or other proprietary information of any previous employer or other person to which Executive is not lawfully
entitled.

 

6.4  Noncompetition
and Non-solicitation.

 

(a) During
Executive’s employment with the Company and for a period of 12 months after the termination of Executive’s employment with
the Company for any reason or for no reason, Executive will not directly or indirectly, absent the Company’s prior written approval,
render services of a business, professional or commercial nature to any other person or entity in the area of quantum computing development
or such other services or products provided by the Company at the time employment terminates in any geographical area where the Company
does business at the time this covenant is in effect, whether such services are for compensation or otherwise, whether alone or in conjunction
with others, as an employee, as a partner, or as a shareholder (other than as the holder of not more than 1% of the combined voting power
of the outstanding stock of a public company), officer or director of any corporation or other business entity, or as a trustee, fiduciary
or in any other similar representative capacity.

 

    	 	6	 

     

    

  

(b) During
the Executive’s employment with the Company and for a period of 12 months after the termination of Executive’s employment
for any reason or for no reason, Executive will not, directly or indirectly, recruit, solicit or induce, or attempt to recruit, solicit
or induce any employee or employees of the Company to terminate their employment with, or otherwise cease their relationship with, the
Company.

 

(c) During
the Executive’s employment with the Company and for a period of 12 months after termination of Executive’s employment for
any reason or for no reason, Executive will not, directly or indirectly, contact, solicit, divert or take away, or attempt to solicit,
contact, divert or take away, the business or patronage of any of the clients, customers or accounts, or prospective clients, customers
or accounts, of the Company.

 

6.5 Interpretation
of Agreement. If any restriction set forth in this Section is found by any court of competent jurisdiction to be unenforceable because
it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted
to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable.

 

6.6  Restrictions
Necessary. The restrictions contained in this Section are necessary for the protection of the business, proprietary information, and
goodwill of the Company and are considered by Executive to be reasonable for such purpose. Executive agrees that any breach of this Section
will cause the Company substantial and irrevocable damage and therefore, in the event of any such breach, in addition to such other remedies
which may be available, the Company shall have the right to seek specific performance and injunctive relief. The prevailing party shall
be entitled to recover its reasonable attorneys’ fees in such an action. In addition, the Company’s obligation to pay Executive
the amount set forth in Section 5.2 or 5.3 shall terminate in the event Executive materially breaches any terms and conditions in Section
6.

 

7.  Entire
Agreement. This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings,
whether written or oral relating to the subject matter of this Agreement between the Company and the Executive. For the avoidance of doubt,
however, this Agreement is in addition to, and shall not supersede any stock option agreement between the Company and Executive.

 

8.  Amendment.
This Agreement may be amended or modified only by a written instrument executed by both the Company and Executive.

 

9.  Arbitration.
All disputes concerning compliance with or the interpretation of this Agreement, or any other aspect of Executive’s employment with
the Company or the termination of that employment, shall be resolved by a single arbitrator under the Employment Dispute Rules then obtaining
of the American Arbitration Association. The decision of the arbitrator shall be final and binding. Notwithstanding the foregoing, any
claims by the Company concerning Executive’s compliance with the Nondisclosure and Noncompetition provisions of this Agreement are
excluded from the scope of this Arbitration provision and may be brought in any court of competent jurisdiction. This Agreement shall
be construed, interpreted and enforced in accordance with the laws of the Commonwealth of Virginia without regard to principles of conflicts
of laws thereunder.

 

    	 	7	 

     

    

  

10.  Notices.
Any notice or other communication required or permitted by this Agreement to be given to a party shall be in writing and shall be deemed
given if delivered personally or by commercial messenger or courier service, or mailed by U.S. registered or certified mail (return receipt
requested), or sent via facsimile (with receipt of confirmation of complete transmission) to the party at the party's last known address
or facsimile number or at such other address or facsimile number as the party may have previously specified by like notice. If by mail,
delivery shall be deemed effective three business days after mailing in accordance with this Section.

 

11.Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of both parties and their respective successors and assigns,
including any corporation into which the Company may be merged or which may succeed to its assets or business, provided, however, that
the obligations of Executive are personal and shall not be assigned by her/him.

 

12.  Miscellaneous.

 

12.1  No
Waiver. No delay or omission by the Company in exercising any right under this Agreement shall operate as a waiver of that or any
other right. A waiver or consent given by the Company on any one occasion shall be effective only in that instance and shall not be construed
as a bar or waiver of any right on any other occasion.

 

12.2  Severability.
In case any provision of this Agreement shall be invalid, illegal or otherwise unenforceable, the validity, legality and enforceability
of the remaining provisions shall in no way be affected or impaired thereby.

 

12.3  Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which together shall
constitute one and the same instrument and facsimile signatures delivered by fax or e-mail transmission shall be treated as originals.

 

[Signature page follows]

 

    	 	8	 

     

    

 

IN WITNESS WHEREOF,
each of the Company and Executive has executed this Amendment as of the date first above written.

 

	 	QUANTUM COMPUTING INC.
	 	 
	 	By:	                   
	 	 	Name: Robert Liscouski
	 	 	Title: Chief Executive Officer
	 	 
	 	Date Executed: ______________
	 	 
	 	By:	 
	 	 	William McGann
	 	 
	 	Date Executed: ___________

 

[Signature page for employment agreement]

 

    	 	9	 

     

    

 

Exhibit A

 

Performance Goals for 2022 (I inserted some ideas below but feel
free to suggest others)

 

		1.	Closing the merger with Project Alpha

 

		2.	Generating $1 M of bookings

 

		3.	Manage software development team working on Qatalyst product

 

		4.	Manage development of quantum products with GEX Data Labs

 

    	 	10	 

     

    

  

EXHIBIT B

 

General Release of Claims

 

1. Your
Release of Claims. By signing this Agreement, you hereby agree and acknowledge that, for good and valuable consideration, you
are waiving your right to assert any and all forms of legal claims against the Company1/ of any kind whatsoever, whether
known or unknown, arising from the beginning of time through the date you execute this Agreement (the “Execution Date”). Except
as set forth below, your waiver and release herein is intended to bar any form of legal claim, complaint or any other form of action (jointly
referred to as “Claims”) against the Company seeking any form of relief including, without limitation, equitable relief (whether
declaratory, injunctive or otherwise), the recovery of any damages, or any other form of monetary recovery whatsoever (including, without
limitation, back pay, front pay, compensatory damages, emotional distress damages, punitive damages, attorneys’ fees and any other
costs) against the Company, for any alleged action, inaction or circumstance existing or arising through the Execution Date.

 

Without limiting the foregoing
general waiver and release, you specifically waive and release the Company from any Claim arising from or related to your prior employment
relationship with the Company or the termination thereof, including, without limitation:

 

		**	Claims under any state or federal discrimination, fair employment practices or other employment related
statute, regulation or executive order (as they may have been amended through the Execution Date) prohibiting discrimination or harassment
based upon any protected status including, without limitation, race, national origin, age, gender, marital status, disability, veteran
status or sexual orientation. Without limitation, specifically included in this paragraph are any Claims arising under the Age Discrimination
in Employment Act, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Equal Pay Act, the Americans With Disabilities
Act and any similar Federal and state statute.

 

		**	Claims under any other state or federal employment related statute, regulation or executive order (as
they may have been amended through the Execution Date) relating to wages, hours or any other terms and conditions of employment.

 

		**	Claims under any state or federal common law theory including, without limitation, wrongful discharge,
breach of express or implied contract, promissory estoppel, unjust enrichment, breach of a covenant of good faith and fair dealing, violation
of public policy, defamation, interference with contractual relations, intentional or negligent infliction of emotional distress, invasion
of privacy, misrepresentation, deceit, fraud or negligence.

 

		**	Any other Claim arising under state or federal law.

 

 

1/  
For purposes of this Agreement, the Company includes the Company and any of its divisions, affiliates (which means all persons and entities
directly or indirectly controlling, controlled by or under common control with the Company), subsidiaries and all other related entities,
and its and their directors, officers, employees, trustees, agents, successors and assigns.

 

    	 	11	 

     

    

  

You acknowledge and agree
that, but for providing this waiver and release, you would not be receiving the economic benefits being provided to you under the terms
of this Agreement. You further acknowledge that this release does not waive any claims you cannot by law waive and does not release any
claims that arise after its execution.

 

It is the Company’s
desire and intent to make certain that you fully understand the provisions and effects of this Agreement. To that end, you have been advised
and given the opportunity to consult with legal counsel for the purpose of reviewing the terms of this Agreement. Also, because you are
over the age of 40, the Age Discrimination in Employment Act (“ADEA”), which prohibits discrimination on the basis of age,
allows you at least twenty-one (21) days to consider the terms of this Agreement. ADEA also allows you to rescind your assent to this
Agreement if, within seven (7) days after you sign this Agreement, you deliver by hand or send by mail (certified, return receipt and
postmarked within such 7 day period) a notice of rescission to the Company. The eighth day following your signing of this Agreement is
the Effective Date.

 

Also, consistent with the
provisions of Federal law, nothing in this release shall be deemed to prohibit you from challenging the validity of this release under
the discrimination laws (the “Federal Discrimination Laws”) or from filing a charge or complaint of employment-related discrimination
with the Equal Employment Opportunity Commission (“EEOC”) or any state fair employment practices agency, or from participating
in any investigation or proceeding conducted by the EEOC or any state fair employment practices agency. Further, nothing in this release
or Agreement shall be deemed to limit the Company’s right to seek immediate dismissal of such charge or complaint on the basis that
your signing of this Agreement constitutes a full release of any individual rights under the Federal Discrimination Laws, or to seek restitution
to the extent permitted by law of the economic benefits provided to you under this Agreement in the event that you successfully challenge
the validity of this release and prevail in any claim under the Federal Discrimination Laws.

 

	 	By: 	                      
	 	 	Executive: William J. McGann
	 	 
	 	Date signed: _________________

 

    	 	12

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