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EMPLOYMENT AGREEMENT 
OF
DONALD YOUNG

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into, effective as of the 1st day of January 2021 (the “Effective Date”) by and between Better Choice Company, Inc., a Delaware corporation (together with any of its subsidiaries and affiliates as may employ the Executive from time to time, the “Company”), and Donald Young, an individual (the “Executive”).  The Company and the Executive are referred to jointly herein as the “Parties,” and individually as a “Party.”

WITNESSETH

WHEREAS, the Company desires to employ the Executive on the terms and conditions provided in this Agreement, and the Executive is willing to accept such employment with the Company on the terms and conditions provided herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements hereafter set forth, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, hereby agree as follows.

1.    Employment.  The Company hereby employs the Executive on an at-will basis to perform those duties generally described in this Agreement, and the Executive hereby accepts and agrees to be so employed, on the terms and conditions hereinafter set forth. The Executive’s start date shall be the Effective Date, January 1, 2021.

2.    Position and Duties.  

a.    During the Executive’s employment under this Agreement, the Executive shall initially hold the position of Executive Vice President of Sales.  The Executive shall perform such duties as such position would normally perform or as otherwise specified in the Company’s By-laws, and shall perform such other reasonable duties as the Chief Executive Officer (“CEO”) of the Company may from time to time prescribe.  During the Executive’s employment: (i) the Executive shall devote at least forty (40) hours per week to fulfill the duties of their position, and shall use their best efforts, judgment and energy to improve and advance the business and interests of the Company in a manner consistent with the duties of their position; and (ii) the Executive shall not hold any other employment or business affiliations (other than those positions currently held by the Executive that are listed on Annex A) without the express written approval, in advance, of the Chairman.  The Executive represents to the Company that he is not subject to or a party to any employment agreement, non-competition covenant, or any other agreement, covenant, or understanding which would prohibit or restrict the Executive from fully performing their duties hereunder.

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b.    The Executive acknowledges that the Company is publicly-held and, as a result, has implemented inside information policies designed to preclude its executives and those of its subsidiaries from violating the federal securities laws by trading on material, non-public information or passing such information on to others in breach of any duty owed to the Company and its subsidiaries or any third party.  The Executive shall promptly execute any agreements generally distributed by the Company to its employees requiring such employees to abide by its inside information policies.

    3.    Place of Performance.  The Executive shall perform their duties at the Company’s headquarters when required or remotely as agreed, except for travel that is required to perform the duties of their position and to carry out the business affairs of the Company.  

    4.    Compensation.  During the Executive’s employment, for all services rendered by the Executive, the Company shall pay the Executive a fixed annual salary of $250,000, in bi-weekly installments of $9,615.38, in accordance with the Company’s usual payroll schedule, subject to applicable tax withholding requirements.  The Executive’s salary shall be reviewed at least annually by the Board and the Board may, but shall not be required to, increase the Executive’s salary during the Executive’s employment under this Agreement.

    5.    Bonus Compensation.  The Executive shall be entitled to receive an annual bonus of up to fifty percent (50%) of the fixed salary listed in Section 4 as additional compensation, comprised of a standard executive target bonus of 25%-40% based on the achievement of reasonable business goals as defined by the CEO, and an incremental bonus of 10% contingent on meeting defined sales targets, all in accordance with the Better Choice Company Bonus Management Incentive Plan (the “MIP”), and as set forth in Exhibit A.  All bonuses are paid at the sole discretion of the Board of Directors, and no annual bonus shall be paid unless the Executive remains continuously employed with the Company beginning on the Start Date and ending on the last date of the fiscal year to which the annual bonus relates. Any such annual bonus shall be payable on, or at such date as is determined by the Board of Directors, within 120 days following the last day of the fiscal year with respect to which it relates.

    6.    Employment Benefits.  In addition to the compensation provided for in Sections 4 and 5 above to be paid to the Executive during the Employment Term, the Executive shall:

        a.    be eligible to participate in any retirement plans that may be provided by the Company for its employees in accordance with the provisions of any such plans and the Company’s policies;

        b.    be entitled to non-disability parental leave and disability-related maternity leave, as applicable, in accordance with the Company’s policies;

        c.    be eligible to participate in any life, disability, accident, or other insurance plans and/or medical and health plans, or others employee welfare benefit plans, that may be provided by the Company for its employees in accordance with the provisions of any such plans;
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        d.    be eligible for 20 days of Paid Time Off each fiscal year, accrued in accordance with the Company’s standard policies, without loss of compensation or other benefits to which the Executive is entitled under this Agreement, to be taken at such times as the Executive may select and the affairs of the Company may permit. Any unused days will be carried over to the next fiscal year; and

        e.    be eligible to participate in any deferred compensation programs that the Company has or may establish for its executive employees.

        All benefits are subject to applicable IRS guidelines, applicable deductions or withholdings, federal and state law, and the Company’s policies as may be in effect from time to time.

    7.    Stock Options and Performance Incentive Equity.  In consideration of entering into this Agreement, the Company shall grant to the Executive an option to purchase 500,000 shares of its common stock (the “Initial Option Grant”), as set forth on Exhibit B hereto, pursuant to the Better Choice Company, Inc. 2019 Incentive Award Plan (the “Plan”).  The Initial Option Grant shall be subject to the terms and conditions of the Plan, or any successor plan thereto, which may be modified or revoked at any time in the sole discretion of the Company, and applicable award agreements thereunder.

a.    Performance Incentive Equity.  In addition to the Initial Option Grant, the Executive shall be eligible to receive additional stock option equity grants (the “Additional Grants”) at the end of each year, assuming individual and Company bonus targets are achieved, as outlined in the MIP.  The Additional Grants, which shall be within the allotted management incentive pool of options, will be awarded at the discretion of the Board and based on performance of the Executive and their team for each year of operations.  The Additional Grants shall be subject to the terms and conditions of the Plan, or any successor plan thereto, which may be modified or revoked at any time in the sole discretion of the Company, and applicable award agreements thereunder.

    8.    Working Facilities and Staff.  The Company shall provide to the Executive, as is reasonably appropriate, suitable offices, facilities, and staff appropriate for and commensurate with the Executive’s position, and suitable for the performance of the Executive’s responsibilities.

    9.    Expenses.  The Company shall, upon submission of receipts or expense reports acceptable to the Company, reimburse the Executive for all reasonable expenses incurred by the Executive in connection with the performance of their obligations hereunder.

    10.    Inventions, Designs, and Product Developments.  All inventions, designs, ideas, innovations, techniques, processes, procedures, improvements, and product developments, including without limitation those relating to software and other computer system components, developed or conceived by the Executive, solely or jointly with others (whether or not patentable 
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or copyrightable), at any time during the employment with the Company that (i) relate directly or indirectly to the actual or planned business activities of the Company or (ii) that are otherwise made through the use of the Company’s time, facilities, or materials (collectively, the “Intellectual Property”) shall be the exclusive property of the Company, with all copyrightable Intellectual Property to be deemed “works for hire” under the federal Copyright Act.  The Executive hereby assigns, transfers, and conveys to the Company all of their right, title, and interests in any such Intellectual Property.  The Executive shall disclose fully, and as soon as practicable and in writing, all Intellectual Property to the Board.  At any time, and from time to time, upon request of the Company, the Executive shall execute and deliver to the Company any and all instruments, documents, and papers, give evidence and do any and all other acts deemed necessary or desirable by the Company, to document such transfer or to enable the Company to file and prosecute applications for and to acquire, maintain and enforce any and all patents, trademark registrations, or copyrights under the laws of the United States (or any of its states) or foreign law with respect to such Intellectual Property or to obtain any extension, validation, re-issue, continuance, or renewal of such patent, trademark, or copyright.  The duty to cooperate in the protection of the Company’s Intellectual Property as described in this Section 10 shall survive the expiration or termination of this Agreement.

    11.    Covenant Regarding Confidential Information.  The Executive hereby covenants, agrees, and acknowledges as follows:

        a.    The Executive’s employment hereunder creates a relationship of confidence and trust between the Executive and the Company with respect to certain knowledge and information applicable to the business of the Company, which will be learned by the Executive during the period of the Executive’s employment.

        b.    The Executive agrees that they shall not during or after their employment with the Company ceases for any reason, disclose to any other person or entity, except as required to perform employment services exclusively for the benefit of the Company, any of the Company’s Confidential Information.  The term “Confidential Information” shall include all information, in whatever form, of a proprietary or commercial nature relating to the Company’s business not already within the public domain (other than as a result of disclosure by the Executive), including without limitation all information relating to the Company’s finances, marketing strategies and techniques, pricing, customers or clients, contracts, employees and personnel, technologies, inventions, intellectual property, suppliers, processes, methods and manners of operation, procurement or delivery of services, management information systems, techniques, budgeting, and the like.  For purposes of this Section 11, the Company shall include any parent, subsidiary, or affiliate of the Company.

        c.    The Executive agrees that upon the termination of their employment with the Company, for any reason, they will promptly return all tangible items (including documents) containing or relating to any Confidential Information, along with all other property of the Company then in the Executive’s possession, and that they will promptly delete any Confidential Information that they may have stored in electronic format on any equipment belonging to them.  The Executive will promptly certify to the Company that they have complied with this provision.
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        d.    The Executive acknowledges that the nondisclosure obligations of this Section 11 shall survive the expiration or termination of this Agreement, and that a remedy at law for any breach or threatened breach of the provisions of this Section 11 would be inadequate, and therefore agrees that the Company shall be entitled to injunctive relief in addition to any other available rights and remedies in case of any such breach or threatened breach, provided, however that nothing contained herein shall be construed as prohibiting the Company from pursuing any other remedies available for any such breach or threatened breach.

    12.    Non-solicitation.  During the Executive’s employment by the Company, and for twelve (12) months following the termination of the Executive’s employment for any reason, the Executive shall not, directly or indirectly:

        a.    solicit, recruit, encourage, or induce any employee of the Company (or of its parents, subsidiaries, or affiliates) to leave their employment with the Company (or of its parents, subsidiaries, or affiliates) for any other employment or business opportunity.  For purposes of this Section 12, the term “employee” shall include any individual who is then employed by the Company or who has been employed by the Company within six months of the solicitation efforts; or

        b.    solicit, recruit, encourage, or induce any contractor, agent, client or customer, supplier, or the like of the Company to terminate its/their relationship with the Company, in whole or in part, or solicit, induce, or encourage any person/entity to terminate, in whole or in part, any contractual relationship with the Company or to refrain from entering into a contractual relationship with the Company (including without limitation any prospective customers/clients of the Company).  For purposes of this Section 12(b), the Company shall include any parent, subsidiary, or affiliate of the Company.

    It is understood and agreed that the covenants made by the Executive in this Section 12 shall survive the expiration or termination of this Agreement.  It is further agreed that during any period in which the Executive is found to be in breach of the requirements of this Section 12, the twelve (12) month time period set forth above shall be tolled so that the Company is provided with the full benefit of the twelve (12) month restrictive period.

    13.    Termination.  The Executive’s employment hereunder shall be terminated upon the occurrence of any of the following:

        a.    immediately upon the death of the Executive;

        b.    at the discretion of the Company upon the inability of the Executive to perform the essential functions of their job on account of disability or incapacity for a period of three or more months, whether consecutive or non-consecutive, despite reasonable accommodation attempts by the Company for the disability, during the Executive’s employment (“Disability”); such termination to take effect immediately upon written notice from the Company to the Executive;
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        c.    termination of the Executive’s employment hereunder by the Executive at any time for any reason whatsoever including, without limitation, resignation or retirement; provided, however, that the Executive shall provide the Company with at least three months’ advance written notice of their intent to terminate this Agreement under this provision; and

        d.    termination of the Executive’s employment by the Company at any time and for any reason with at least thirty (30) days advance written notice from the Company to the Executive.  

    14.    Payments for Termination.  In the event the Executive’s employment is terminated for any reason set forth in Section 13, (whether by either the Company or the Executive), the Executive shall be entitled to the total unpaid compensation owing to the Executive, consisting of the pro rata share of any compensation provided for under Section 4 through the date of such termination, any payments due under Section 5 with respect to any prior completed fiscal year, and any unreimbursed expenses under Section 9, and, as severance payment, the Company shall continue payment of the Executive’s salary, as described in Section 4, for a period of six (6) months immediately following the Executive’s termination date.

    15.    Compensation Upon Merger.  Notwithstanding the clause outlined in Section 14 herein, in the event of a Merger (as defined in Section 15.a.) occurring during the duration of the Executive’s employment with the Company, the following shall be applicable:

        a.    Merger.  Merger shall mean a merger, consolidation, acquisition or liquidation event of the Company with, into or by any other corporation or corporations, or a sale of all or substantially all of the assets of the Company, resulting in the stockholders of the Company immediately prior to such transaction holding less than a majority of the outstanding voting equity securities of the surviving corporation in such merger, consolidation, acquisition or sale of assets reorganized.

        b.    Company’s Successors.  Any successor to the Company (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation, or otherwise) to all or substantially all of the Company’s business and/or assets shall assume the Company’s obligations under this Agreement and shall agree expressly to perform the Company’s obligations under this Agreement in the same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession.  For all purposes under this Agreement, the term “Company” shall include any successor to the Company’s business and/or assets which executes and delivers the assumption agreement described in this subsection or which become bound by the terms of this Agreement by operations of law.

        c.    Termination for Cause.  In the event the Executive’s employment hereunder is terminated by the Company for cause, the Company shall pay and provide to the employee any and all payments as outlined under Section 14 of this Agreement.

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        d.    Cause.  Cause shall mean (i) any act of personal dishonesty taken by the Executive in connection with their responsibilities as an employee which is intended to result in personal enrichment of the Executive, (ii) the Executive’s conviction of a felony that the Board of Directors reasonably believes has had or will have a material detrimental effect on the Company’s reputation or business, (iii) a willful act by the Executive that constitutes misconduct and is injurious to the Company, including without limitation any breach of Section 11 hereof, and (iv) continued willful violations by the Executive of the Executive’s obligations to the Company for a period of thirty (30) days after there has been delivered to the Executive a written demand for performance from the Company which describes the basis for the Company’s belief that the Executive has not substantially performed their duties.

        e.    Termination for Good Reason or Without Cause.  In the event the Executive’s employment hereunder is terminated either by the Executive for Good Reason or by the Company without Cause within twelve (12) months following a Merger, the Company shall pay and provide to the employee any and all payments as outlined under Section 14 of this Agreement and the Company shall provide the Executive with an additional lump sum amount equal to six (6) months of the employee’s base salary (as in effect immediately prior to the date of such termination). This payment shall be made within five (5) business days following the date of such termination.

        f.    Good Reason.  Good Reason shall exist if one or more of the following circumstances exists uncured for a period of thirty (30) days after the Executive has notified the Company of the existence of such circumstance(s) after a merger: (i) without the Executive’s express written consent, a significant reduction of the Executive’s duties, position or responsibilities relative to the Executive’s duties, position or responsibilities in effect immediately prior to such reduction, or the removal of the Executive from such position, duties, and responsibilities, unless the Executive is provided with comparable duties, position and responsibilities, it being understood that the Executive shall not be deemed to have been removed from such position if and as long as the Executive shall be offered or shall have an executive position within their area of experience or expertise; (ii) without the Executive’s express written consent, a substantial reduction, without good business reasons, of the facilities and tools (including office space and location) available to the Executive immediately prior to such reduction; (iii) a reduction by the Company of the Executive’s base salary as in effect immediately prior to such reduction; (iv) a material reduction by the Company in the kind or level of employee benefits to which the Executive is entitled immediately prior to such a reduction with the result that the Executive’s overall benefits package is significantly reduced; or (v) without the Executive’s express written consent, the relocation of the Executive to a facility or a location more than fifty (50) miles from their then-current location.

        g.    Vesting of Options.  Immediately preceding a merger, all of the Executive’s then unvested options shall immediately vest and become exercisable in their entirety.  Any exercise of options may, at the election of Executive, be exercised with a “cashless exercise” by using shares from any such exercise to pay the exercise price, which shares, for such purpose, being valued at the fair market value, as determined under the Plan, on the date of exercise.
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    16.    Limit on Payments.  

        a.    Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined by the Company that any payment or distribution by the Company to or for the benefit of the Executive (whether paid for payable or distributed or distributable pursuant to the terms of this Agreement or otherwise) would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code, then such payments and/or distributions to the Executive shall be reduced or deferred to the extent necessary so that no such amounts are subject to such excise tax.

        b.    All determinations required to be made under this Section 16 and the assumptions to be utilized in arriving at such determinations, shall be made by the Company’s certified public accounting firm (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and the Executive within 10 business days of the receipt of notice from the Executive or the Company that there will be a payment potentially subject to the excise tax imposed by Section 4999 of the Code, or such earlier time as is requested by the Company.  All fees and expenses of the Accounting Firm shall be borne solely by the Company.  Any determination by the Accounting Firm shall be binding upon the Company and the Executive.

    17.    Non-Transferability of Payments Due Under This Agreement.  Neither the Executive, the Executive’s spouse, the Executive’s designated contingent beneficiary, nor any of the Executive’s estates shall have any right to anticipate, encumber or dispose of any payment due under this Agreement.  Such payments and other rights are expressly declared non-assignable and non-transferable except as specifically provided herein.

    18.    Noncompetition.  

        a.    During the course of the Executive’s employment and for twelve (12) months following the termination of the Executive’s relationship with the Company (the "Noncompetition Period") for any reason or no reason, at the option either of the Company or the Executive, with or without notice, the Executive will not, without the prior written consent of the Company, (i) serve as a partner, employee, consultant, officer, director, manager, agent, associate, investor, actor or writer, or (ii) directly or indirectly, own, purchase, organize or take preparatory steps for the organization of, or (iii) build, design, finance, acquire, lease, operate, manage, invest in, work or consult for or otherwise affiliate myself with any business, (A) in competition with or otherwise similar to the Company's business at the time the Executive’s employment with the Company terminates or (B) in competition with any other line of business that the Executive knew or reasonably should have known during their employment with the Company that the Company had formed an intention to enter.  This covenant shall not prohibit the Executive from owning less than two percent of the securities of any competitor of the Company, if such securities are publicly traded on a nationally recognized stock exchange or over-the-counter market.  The foregoing covenant shall cover the Executive’s activities in every part of the Territory (as defined below) in which they may conduct business during the 
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Noncompetition Period.  During the Noncompetition Period, the Executive shall not, without the prior written consent of the Company, (i) solicit business or sales, for the same or similar products or services as provided by the Company, from any customer, client or account of the Company ("Customers") or (ii) attempt to convert Customers to other sellers or providers for the same or similar products or services as provided by the Company.  For purposes of this Section 18.a., “Territory” means (i) all counties in the state of Tennessee, (ii) all other states of the United States of America and (iii) all other countries of the world where the Company derives at least three percent (3%) of its gross revenues prior to the date of the termination of my relationship with the Company.

        b.    The Executive’s fulfillment of the obligations contained in this Agreement, including, but not limited to, the Executive’s obligation neither to disclose nor to use Confidential Information other than for the Company's exclusive benefit and the Executive’s obligations not to solicit and not to compete are necessary to protect Confidential Information and to preserve the, trade secrets, value and goodwill of the Company.  The Executive shall further acknowledge the that time, geographic and scope limitations of their obligations under Section 18.a. are reasonable, especially in light of the Company's desire to protect Confidential Information and trade secrets.

        c.    The covenants contained in Section 18.a. above shall be construed as a series of separate covenants, one for each city, county and state of any geographic area in the Territory.  Except for geographic coverage, each such separate covenant shall be deemed identical in terms to the covenant contained in Section 18.a. above.  If, in any judicial proceeding, a court refuses to enforce any of such separate covenants (or any part thereof), then such unenforceable covenant (or such part) shall be eliminated from this Agreement to the extent necessary to permit the remaining separate covenants (or portions thereof) to be enforced.  In the event the provisions of Section 18.a. are deemed to exceed the time, geographic or scope limitations permitted by Delaware law, then such provisions shall be reformed to the maximum time, geographic or scope limitations, as the case may be, then permitted by such law.

    19.    Conflicts of Interest.  While employed by the Company, the Executive shall not, unless approved by the Board of Directors or its Compensation Committee, directly or indirectly:

        a.    Participate as an individual in any way in the benefits of transactions with any of the Company’s vendors, clients, customers, suppliers or manufacturers, without limitation, having a financial interest in the Company’s vendors, clients, customers, suppliers or manufacturers or making loans to, or receiving loans, from, the Company’s vendors, clients, customers, suppliers or manufacturers;

        b.    realize a personal gain or advantage from a transaction in which the Company has an interest or use information obtained in connection with the Executive’s employment with the Company for the Executive’s personal advantage or gain; or

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        c.    accept any offer to serve as an officer, director, partner, consultant, manager with, or to be employed in a professional, technical, or managerial capacity by, a person or entity which does business with the Company.

    20.    Compensation Recovery Policy.  The Executive acknowledges and agrees that, to the extent the Company adopts any claw-back or similar policy pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act or otherwise, and any rules and regulations promulgated thereunder, the Executive shall take all action necessary or appropriate to comply with such policy (including, without limitation, entering into any further agreements, amendments or policies necessary or appropriate to implement and/or enforce such policy).

    21.    Assignment.  This Agreement shall not be assignable by either Party, without the written consent of the other Party, except that the Company may, without the consent of the Executive, assign this Agreement (i) to any parent, subsidiary, or affiliate of the Company either now existing or created in the future; or (ii) to any person or entity into which the Company merges or consolidates.

    22.    Notices.  All notices that are required or permitted hereunder shall be in writing and shall be sufficient if personally delivered, if sent by registered or certified mail, or if sent by Federal Express or by other overnight delivery service, to the addresses set forth below, unless such address is changed by written notice to the other Party:

TO THE EXECUTIVE:

Donald Young (at the address in the Company’s files)

TO THE COMPANY:

Better Choice Company, Inc.
4025 Tampa Road
Oldsmar, FL 34677

    23.    Entire Agreement.  This Agreement supersedes and is controlling over any and all other prior existing agreements between the Parties with respect to the employment of the Executive by the Company.  All negotiations, commitments and understandings acceptable to both Parties have been incorporated herein.  No letter, telegram, or other communication passing between the Parties hereto covering any matter during the Executive’s employment, or any plans or periods thereafter, shall be deemed a part of this Agreement, nor shall it have the effect of modifying or adding to this Agreement unless it is distinctly stated in such letter, telegram or communication that it is to constitute a part of this Agreement and is to be attached as a rider to this Agreement and is signed by the Parties to this Agreement.  This Agreement may not be amended except by a written instrument executed by both Parties.

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    24.    Enforcement.  The Executive acknowledges that any remedy at law for breach of Sections 10, 11, and 12 would be inadequate, acknowledges that the Company would be irreparably damaged by an actual or threatened breach thereof, and agrees that the Company shall be entitled to an injunction restraining the Executive from any actual or threatened breach of Sections 10, 11, and 12 as well as any further appropriate relief.  No claim by the Executive that the Company has breached any obligations to the Executive shall be a defense to the enforcement of the Executive’s obligations under Sections 10, 11, and 12.  In any action to enforce Sections 10, 11, and 12, the Executive consents to jurisdiction and venue in the federal or state courts located in the State of Delaware.

    25.    Governing Law.  This Agreement shall be governed by and interpreted in accordance with the laws of the State of Delaware, without regard to the principles of conflict of laws.

    26.    Severability.  If and to the extent that any court of competent jurisdiction holds any provision or any part thereof of this Agreement to be invalid or unenforceable, such holding shall in no way affect the validity of the remainder of this Agreement.

    27.    Waiver.  No failure by any Party to insist upon the strict performance of any covenant, duty, agreement, or condition of this Agreement or to exercise any right or remedy consequent upon a breach hereof shall constitute a waiver of any such breach or of any other covenant, agreement, term, or condition.

[signature page follows]

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IN WITNESS WHEREOF, the Company and the Executive have executed and delivered this Agreement to be effective as of the date first above written.

“The Company”

                    BETTER CHOICE COMPANY, INC.

By:                         

Its:                         

“The Executive”

DONALD YOUNG

                        

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EXHIBIT A

Target Bonus

The Company’s Executive team members that are full-time employees are eligible to participate in the Better Choice Company Bonus Management Incentive Plan (the “MIP”). The MIP is performance based whereby executives can earn between 25-50% of their base salary in additional bonus compensation based on Company and individual performance for a given year. Please note that all bonus payouts are subject to Board approval for execution. Please reference the Board approved MIP each year for target payout percentages. 

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EXHIBIT B

Performance Incentive Equity

On the Effective Date, the Company shall grant to the Executive an option to purchase 500,000 shares of its common stock (the “Option”), which shall vest, subject to the Executive’s continued status as an Employee, Director, or Consultant, and become exercisable as to 1/3rd of the Shares on the first anniversary of the Effective Date (rounded down to the next whole number of Shares).  Thereafter, subject to the Executive’s continued status as an Employee, Director, or Consultant through each vesting date, the Option shall vest and become exercisable as to 1/36th of the Shares subject thereto on the 13th month anniversary of the Effective Date and each monthly anniversary thereafter (rounded down to the next whole number of Shares), such that the Option shall be fully vested and exercisable on the 3rd anniversary of the Grant Date.  

For the avoidance of doubt, in the event of a Change in Control, the Option shall immediately vest and become exercisable in its entirety. Any exercise of options may, at the election of Executive, be exercised with a “cashless exercise” by using shares from any such exercise to pay the exercise price, which shares, for such purpose, being valued at the fair market value, as determined under the Plan, on the date of exercise.

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15Exhibit
4.2

  

DESCRIPTION
OF SECURITIES REGISTERED UNDER SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

 

The
following description of registered securities of ImmuCell Corporation (“us,” “our,” “we”
or the “Company”) is intended as a summary only and therefore is not a complete description. This description is based
upon, and is qualified by reference to, our certificate of incorporation, our by-laws and applicable provisions of the Delaware
General Corporation Law (the “DGCL”). You should read our certificate of incorporation and by-laws, which are incorporated
by reference as Exhibits3.1 - 3.6 and 3.7, respectively, to the Annual Report on Form 10-K of which this Exhibit 4.2 is a part,
for the provisions that are important to you.

 

Our
authorized capital stock consists of 15,000,000 shares of common stock. As of March 19, 2021 there were 7,220,836 shares of common
stock outstanding. Our common stock is registered under Section 12(g) of the Securities Exchange Act of 1934, as amended.

 

Common
Stock

 

The
holders of common stock are entitled to receive ratable dividends, if any, as may be declared from time to time by the Board of
Directors out of funds legally available for that purpose. In the event of our liquidation, dissolution or winding up, whether
voluntary or involuntary, the holders of common stock are entitled to share ratably in all assets remaining after payment of or
provision for liabilities. The common stock has no preemptive or conversion rights or other subscription rights. There are no
redemption or sinking fund provisions applicable to the common stock. All outstanding shares of common stock are fully paid and
nonassessable, and the shares of common stock to be issued upon the closing of this offering will be fully paid and nonassessable.

 

The
holders of common stock are entitled to one vote per share on all matters to be voted upon by the shareholders. There is
no cumulative voting.

  

Effect
of Certain Provisions of our Certificate of Incorporation, Bylaws and Common Stock Rights Plan

 

Provisions
of our certificate of incorporation, our bylaws, our Common Stock Rights Plan or Delaware law may discourage, delay or prevent
a merger, acquisition or other change in control that stockholders may consider favorable, including transactions in which stockholders
might otherwise receive a premium for their shares of our common stock. These provisions may also prevent or frustrate attempts
by our stockholders to replace or remove our management. These provisions include:

 

		●	limitations
                                         on the removal of directors; advance notice requirements for stockholder proposals and
                                         nominations;

 

		●	the
                                         ability of our Board of Directors to alter or repeal our bylaws;

 

		●	the
                                         ability of our Board of Directors to refuse to redeem rights issued under our Common
                                         Stock Rights Plan or otherwise to limit or suspend its operation that would work to dilute
                                         the stock ownership of a potential hostile acquirer, likely preventing acquisitions that
                                         have not been approved by our Board of Directors; and

 

		●	Section
                                         203 of the Delaware General Corporation Law, which prohibits a publicly-held Delaware
                                         corporation from engaging in a business combination with an interested stockholder (generally
                                         defined as a person which together with its affiliates owns, or within the last three
                                         years has owned, 15% of our voting stock, for a period of three years after the date
                                         of the transaction in which the person became an interested stockholder) unless the business
                                         combination is approved in a prescribed manner.

  

The
existence of the foregoing provisions and anti-takeover measures could depress the trading price of our common stock or limit
the price that investors might be willing to pay in the future for shares of our common stock. They could also deter potential
acquirers of our Company, thereby reducing the likelihood of obtaining a premium for our common stock in an acquisition.

 

     

     

    

 

These
provisions, summarized below, are expected to discourage coercive takeover practices and inadequate takeover bids and to promote
stability in our management. These provisions are also designed to encourage persons seeking to acquire control of us to first
negotiate with our Board of Directors.

 

		●	Shareholder
Meetings. Our bylaws provide that a special meeting of shareholders may be called only by the President or by the Board of Directors
or by shareholders holding a majority of the outstanding shares of our common stock.

 

		●	Requirements
for Advance Notification of Shareholder Nominations and Proposals. Our bylaws establish advance notice procedures with respect
to shareholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the
direction of our Board of Directors or a committee of the Board of Directors.

 

		●	Board
of Directors Vacancies. Under our bylaws, any vacancy on the Board of Directors, including a vacancy resulting from an enlargement
of the Board of Directors, may only be filled by vote of a majority of the remaining directors. Any director may be removed by
vote of the holders of a majority of the outstanding shares of our common stock. The limitations on the removal of directors and
filling of vacancies would have the effect of making it more difficult for a third party to acquire control of us, or of discouraging
a third party from acquiring control of us.

 

		●	Board
of Directors Size. Within the range specified by our bylaws, our Board of Directors determines the size of our Board of Directors
and may create new directorships and elect new directors, which may enable an incumbent Board of Directors to maintain control
by adding directors.

 

		●	Indemnification.
Our certificate of incorporation and our bylaws, as amended, provide that we will indemnify officers and directors against losses
as they incur in investigations and legal proceedings resulting from their services to us, which may include service in connection
with takeover defense measures.

 

In
September 1995, our Board of Directors adopted a Common Stock Rights Plan and declared a dividend of one common share purchase
right (a "Right") for each of the then outstanding shares of the common stock of the Company. Each Right entitles the
registered holder to purchase from the Company one share of common stock at an initial purchase price of $70.00 per share, subject
to adjustment. The description and terms of the Rights are set forth in a Rights Agreement between the Company and American Stock
Transfer & Trust Company, LLC, as Rights Agent.

 

The
Rights (as amended) become exercisable and transferable apart from the common stock upon the earlier of i) 10 days following a
public announcement that a person or group (Acquiring Person) has, without the prior consent of the Continuing Directors (as such
term is defined in the Rights Agreement), acquired beneficial ownership of20% or more of the outstanding common stock or ii) 10
days following commencement of a tender offer or exchange offer the consummation of which would result in ownership by a person
or group of20% or more of the outstanding common stock (the earlier of such dates being called the Distribution Date).

 

Upon
the Distribution Date, the holder of each Right not owned by the Acquiring Person would be entitled to purchase common stock at
a discount to the initial purchase price of $70.00 per share, effectively equal to one half of the market price of a share of
common stock on the date the Acquiring Person becomes an Acquiring Person. If, after the Distribution Date, the Company should
consolidate or merge with any other entity and the Company were not the surviving company, or, if the Company were the surviving
company, all or part of the Company's common stock were changed or exchanged into the securities of any other entity, or if more
than 50% of the Company's assets or earning power were sold, each Right would entitle its holder to purchase, at the Rights' then-current
purchase price, a number of shares of the acquiring company's common stock having a market value at that time equal to twice the
Right's exercise price.

 

    2

     

    

 

At
any time after a person or group becomes an Acquiring Person and prior to the acquisition by such person or group of 50% or more
of the outstanding common stock, the Board of Directors of the Company may exchange the Rights (other than Rights owned by such
person or group which have become void), in whole or in part, at an exchange ratio of one share of common stock per Right (subject
to adjustment). At any time prior to 14 days following the date that any person or group becomes an Acquiring Person (subject
to extension by the Board of Directors), the Board of Directors of the Company may redeem the then outstanding Rights in whole,
but not in part, at a price of $0.005 per Right, subject to adjustment.

 

On
June 8, 2005, our Board of Directors voted to authorize an amendment of the Rights Agreement to extend the Final Expiration Date
by an additional three years, to September 19, 2008. As of June 30, 2005, we entered into an amendment to the Rights Agreement
with the Rights Agent reflecting such extension. On June 6, 2008 our Board of Directors voted to authorize an amendment of the
Rights Agreement to extend the Final Expiration Date by an additional three years, to September 19, 2011, and to increase the
ownership threshold for determining "Acquiring Person" status from 15% to 18%. As of June 30, 2008, we entered into
an amendment to the Rights Agreement with the Rights Agent reflecting such extension and threshold increase. On August 5, 2011,
our Board of Directors voted to authorize amendments of the Rights Agreement to extend the Final Expiration Date by an additional
three years to September 19, 2014 and to increase the ownership threshold for determining "Acquiring Person" status
from 18% to 20%. As of August 9, 2011, we entered into an amendment to the Rights Agreement with the Rights Agent reflecting such
extension and threshold increase. On June 10, 2014, our Board of Directors voted to authorize an amendment to the Rights Agreement
to extend the formal expiration date by an additional three years to September 19, 2017. As of June 16, 2014, we entered into
an amendment to the Rights Agreement with the Rights Agent reflecting such extension. As of April 15, 2015, we entered into an
amendment to the Rights Agreement with the Rights Agent deleting the provisions requiring that redemptions of the Rights, waivers
or consents avoiding "Acquiring Person" status or certain amendments to the Rights Agreement be approved by "Continuing
Directors". On June 15, 2017, our Board of Directors voted to authorize an amendment to the Rights Agreement to extend the
final expiration date by an additional five years to September 19, 2022. As of August 10, 2017, we entered into an amendment to
the Rights Agreement with the Rights Agent reflecting such extension. No other changes have been made to the terms of the Rights
or the Rights Agreement.

 

Our
Board of Directors believes that there is some risk that the potential value of the mastitis product development initiative and
the potential value of our broadened First Defense® product line offerings are not fairly reflected in the market price of
our common stock, as it fluctuates from time to time, and that opportunistic buyers could take advantage of that disparity to
the detriment of our stockholders. If this were to happen and result in a potential threat through an unsolicited acquisition
effort or otherwise, our Board of Directors feels that the Common Stock Rights Plan could enhance stockholder value by providing
management with negotiating leverage.

 

Listing

 

Our
common stock is listed on the NASDAQ Capital Market under the symbol "ICCC".

 

Transfer
Agent and Registrar

 

The
transfer agent and registrar for our common stock is American Stock Transfer & Trust Company, LLC.

 

 

3

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