Document:

2004 Equity Incentive Plan

 Exhibit 10.42 
  
 AXESSTEL, INC. 
 2004 EQUITY INCENTIVE PLAN 
  
 1. Purpose of the
Plan. The purpose of this Plan is to encourage ownership in the Company by key personnel whose long-term service is considered essential to the Company’s continued progress and, thereby, encourage recipients to act in the
stockholders’ interest and share in the Company’s success. 
  
 2.
Definitions. As used herein, the following definitions shall apply: 
  
 “Administrator” shall mean the Board, any Committees or such delegates as shall be administering the Plan in accordance with Section 4 of the Plan. 
  
 “Affiliate” shall mean any entity that is directly or indirectly
controlled by the Company or any entity in which the Company has a significant ownership interest as determined by the Administrator. 
  
 “Applicable Laws” shall mean the requirements relating to the administration of stock plans under federal and state laws, any stock exchange or
quotation system on which the Company has listed or submitted for quotation the Common Stock to the extent provided under the terms of the Company’s agreement with such exchange or quotation system and, with respect to Awards subject to the
laws of any foreign jurisdiction where Awards are, or will be, granted under the Plan, the laws of such jurisdiction. 
  
 “Award” shall mean, individually or collectively, a grant under the Plan of Options, Stock Awards, SARs, or Cash Awards. 
  
 “Awardee” shall mean a Service Provider who has been granted an
Award under the Plan. 
  
 “Award Agreement” shall mean
an Option Agreement, Stock Award Agreement, SAR Award Agreement, and/or Cash Award Agreement, which may be in written or electronic format, in such form and with such terms as may be specified by the Administrator, evidencing the terms and
conditions of an individual Award. Each Award Agreement is subject to the terms and conditions of the Plan. 
  
 “Award Transfer Program” shall mean any program instituted by the Administrator which would permit Participants the opportunity to transfer any
outstanding Awards to a financial institution or other person or entity selected by the Administrator. 
  
 “Board” shall mean the Board of Directors of the Company. 
  
 “Cash Award” shall mean a bonus opportunity awarded under Section 13 pursuant to which a Participant may become
entitled to receive an amount based on the satisfaction of such performance criteria as are specified in the agreement or other documents evidencing the Award (the “Cash Award Agreement”). 
  

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 “Change in Control” shall mean any of the following, unless the Administrator provides
otherwise: 
  
 (i) any merger or consolidation in
which the Company shall not be the surviving entity (or survives only as a subsidiary of another entity whose stockholders did not own all or substantially all of the Common Stock in substantially the same proportions as immediately prior to such
transaction), 
  
 (ii) the sale of all or
substantially all of the Company’s assets to any other person or entity (other than a wholly-owned subsidiary), 
  
 (iii) the acquisition of beneficial ownership of a controlling interest (including, without limitation, power to vote) in the outstanding
shares of Common Stock by any person or entity (including a “group” as defined by or under Section 13(d)(3) of the Exchange Act), 
  
 (iv) the dissolution or liquidation of the Company, 
  
 (v) a contested election of Directors, as a result of which or in connection with which the persons who were
Directors before such election or their nominees cease to constitute a majority of the Board, or 
  
 (vi) any other event specified by the Board or a Committee, regardless of whether at the time an Award is granted or thereafter.

  
 “Code” shall mean the United States Internal Revenue
Code of 1986, as amended. 
  
 “Committee” shall mean a
committee of Directors appointed by the Board in accordance with Section 4 of the Plan. 
  
 “Common Stock” shall mean the common stock of the Company. 
  
 “Company” shall mean Axesstel, Inc., a Nevada corporation, or its successor. 
  
 “Consultant” shall mean any person engaged by the Company or any Affiliate to render services to such entity as an
advisor or consultant. 
  
 “Conversion Award” has the
meaning set forth in Section 4(b)(xii) of the Plan. 
  
 “Director” shall mean a member of the Board. 
  
 “Dividend Equivalent” shall mean a credit, made at the discretion of the Administrator, to the account of a Participant in an amount equal to the cash dividends paid on one Share for each Share represented by an Award held by such
Participant. 
  
 “Employee” shall mean a regular, active
employee of the Company or any Affiliate, including an Officer and/or Director. Within the limitations of Applicable Law, the Administrator shall have the discretion to determine the effect upon an Award and upon an 
  

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 individual’s status as an Employee in the case of (i) any individual who is classified by the Company or its
Affiliate as leased from or otherwise employed by a third party or as intermittent or temporary, even if any such classification is changed retroactively as a result of an audit, litigation or otherwise, (ii) any leave of absence approved by the
Company or an Affiliate, (iii) any transfer between locations of employment with the Company or an Affiliate or between the Company and any Affiliate or between any Affiliates, (iv) any change in the Awardee’s status from an employee to a
Consultant or Director, and (v) at the request of the Company or an Affiliate an employee becomes employed by any partnership, joint venture or corporation not meeting the requirements of an Affiliate in which the Company or an Affiliate is a party.

  
 “Exchange Act” shall mean the United States
Securities Exchange Act of 1934, as amended. 
  
 “Exchange
Program” shall mean a program under which (i) outstanding Awards are surrendered or cancelled in exchange for Awards of the same type (which may have lower exercise prices and different terms), Awards of a different type, and/or cash, and/or
(ii) the exercise price of an outstanding Award is reduced. The terms and conditions of any Exchange Program will be determined by the Administrator in its sole discretion. 
  
 “Fair Market Value” shall mean, unless the Administrator determines otherwise, as of any date, the average of the
highest and lowest quoted sales prices for such Common Stock as of such date (or if no sales were reported on such date, the average on the last preceding day on which a sale was made), as reported in such source as the Administrator shall
determine. 
  
 “Grant Date” shall mean the date upon
which an Award is granted to an Awardee pursuant to this Plan. 
  
 “Incentive Stock Option” shall mean an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code and the regulations promulgated thereunder. 
  
 “Nonstatutory Stock Option” shall mean an Option not intended to
qualify as an Incentive Stock Option. 
  
 “Officer”
shall mean a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder. 
  

“Option” shall mean a right granted under Section 8 to purchase a number of Shares or Stock Units at such exercise price, at such times, and
on such other terms and conditions as are specified in the agreement or other documents evidencing the Award (the “Option Agreement”). Both Options intended to qualify as Incentive Stock Options and Nonstatutory Stock Options may be
granted under the Plan. 
  
 “Participant” shall mean the
Awardee or any person (including any estate) to whom an Award has been assigned or transferred as permitted hereunder. 
  
 “Plan” shall mean this Axesstel, Inc. 2004 Equity Incentive Plan. 
  

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 “Prior Plans” shall mean the Company’s stock option pools approved by the Board on
September 16, 2002, authorizing 911,671 Shares for issuance pursuant to stock options, March 5, 2003, authorizing 982,171 Shares for issuance pursuant to stock options, and September 29, 2003, authorizing 1,000,000 Shares for issuance pursuant to
stock options. 
  
 “Qualifying Performance Criteria”
shall have the meaning set forth in Section 14(b) of the Plan. 
  
 “Related Corporation” shall mean any parent or subsidiary (as defined in Sections 424(e) and (f) of the Code) of the Company. 
  
 “Service Provider” shall mean an Employee, Director, or Consultant. 
  
 “Share” shall mean a share of the Common Stock, as adjusted in accordance with Section 15 of the Plan. 

 
 “Stock Award” shall mean an award or issuance of Shares or Stock
Units made under Section 11 of the Plan, the grant, issuance, retention, vesting and/or transferability of which is subject during specified periods of time to such conditions (including continued service or performance conditions) and terms as are
expressed in the agreement or other documents evidencing the Award (the “Stock Award Agreement”). 
  
 “Stock Appreciation Right” or “SAR” shall mean an Award, granted alone or in connection with an Option, that pursuant to Section 12 of
the Plan is designated as a SAR. The terms of the SAR are expressed in the agreement or other documents evidencing the Award (the “SAR Agreement”). 
  
 “Stock Unit” shall mean a bookkeeping entry representing an amount equivalent to the fair market value of one Share, payable in cash, property
or Shares. Stock Units represent an unfunded and unsecured obligation of the Company, except as otherwise provided for by the Administrator. 
  
 “10% Stockholder” shall mean the owner of stock (as determined under Section 424(d) of the Code) possessing more than 10% of the total combined
voting power of all classes of stock of the Company (or any Related Corporation). 
  
 “Termination of Service” shall mean ceasing to be a Service Provider. However, for Incentive Stock Option purposes, Termination of Service will occur when the Awardee ceases to be an employee (as determined
in accordance with Section 3401(c) of the Code and the regulations promulgated thereunder) of the Company or one of its Subsidiaries. The Administrator shall determine whether any corporate transaction, such as a sale or spin-off of a division or
business unit, or a joint venture, shall be deemed to result in a Termination of Service. 
  
 “Total and Permanent Disability” shall have the meaning set forth in Section 22(e)(3) of the Code. 
  

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 3. Stock Subject to the Plan. 
  
 (a) Aggregate Limits. 
  
 (i) The number of Shares initially reserved for issuance under the Plan through Awards is 4,093,842 Shares, plus the additional Shares
described in (ii) below. Such reserve shall consist of (A) the number of Shares available for issuance, as of the effective date of the Plan, under the Prior Plans, plus (B) those Shares that are issuable upon exercise of options granted pursuant to
the Prior Plans that expire or become unexercisable for any reason without having been exercised in full after the effective date of the Plan, plus (C) an additional increase of 1,200,000 Shares to be approved by the Company’s shareholders on
the effective date of the Plan. Notwithstanding the foregoing, the maximum aggregate number of Shares that may be issued under the Plan through Incentive Stock Options is 11,593,842. The limitations of this Section 3(a)(i) shall be subject to the
adjustments provided for in Section 15 of the Plan. 
  
 (ii) As of January 1 of each year, commencing with the year 2005, the maximum aggregate number of Shares that may be issued under the Plan through Awards shall automatically increase by a number equal to the lowest of (i) 3% of the total
number of shares of Common Stock then outstanding, (ii) 750,000 shares of Common Stock or (iii) the number determined by the Board, subject to the adjustments provided for in Section 15 of the Plan. 
  
 (iii) Upon payment in Shares pursuant to the exercise of an
Award, the number of Shares available for issuance under the Plan shall be reduced only by the number of Shares actually issued in such payment. If any outstanding Award expires or is terminated or canceled without having been exercised or settled
in full, or if Shares acquired pursuant to an Award subject to forfeiture or repurchase are forfeited or repurchased by the Company, the Shares allocable to the terminated portion of such Award or such forfeited or repurchased Shares shall again be
available to grant under the Plan. Notwithstanding the foregoing, the aggregate number of shares of Common Stock that may be issued under the Plan upon the exercise of Incentive Stock Options shall not be increased for restricted Shares that are
forfeited or repurchased. Notwithstanding anything in the Plan, or any Award Agreement to the contrary, Shares attributable to Awards transferred under any Award Transfer Program shall not be again available for grant under the Plan. The Shares
subject to the Plan may be either Shares reacquired by the Company, including Shares purchased in the open market, or authorized but unissued Shares. 
  
 (b) Code Section 162(m) Limit. Subject to the provisions of Section 15 of the Plan, the aggregate number of Shares subject to Awards granted under
this Plan during any calendar year to any one Awardee shall not exceed 500,000, except that in connection with his or her initial service, an Awardee may be granted Awards covering up to an additional 1,000,000 Shares. Notwithstanding anything to
the contrary in the Plan, the limitations set forth in this Section 3(b) shall be subject to adjustment under Section 15(a) of the Plan only to the extent that such adjustment will not affect the status of any Award intended to qualify as
“performance based compensation” under Code Section 162(m). 
  

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 4. Administration of the Plan. 
  
 (a) Procedure. 
  
 (i) Multiple Administrative Bodies. The Plan shall be administered by the Board, a Committee and/or their delegates. 
  
 (ii) Section 162. To the extent that the
Administrator determines it to be desirable to qualify Awards granted hereunder as “performance-based compensation” within the meaning of Section 162(m) of the Code, Awards to “covered employees” within the meaning of Section
162(m) of the Code or Employees that the Committee determines may be “covered employees” in the future shall be made by a Committee of two or more “outside directors” within the meaning of Section 162(m) of the Code. 

 
 (iii) Rule 16b-3. To the extent desirable to
qualify transactions hereunder as exempt under Rule 16b-3 promulgated under the Exchange Act (“Rule 16b-3”), Awards to Officers and Directors shall be made in such a manner to satisfy the requirement for exemption under Rule 16b-3.

  
 (iv) Other Administration. The Board
or a Committee may delegate to an authorized Officer or Officers of the Company the power to approve Awards to persons eligible to receive Awards under the Plan who are not (A) subject to Section 16 of the Exchange Act or (B) at the time of such
approval, “covered employees” under Section 162(m) of the Code. 
  
 (v) Delegation of Authority for the Day-to-Day Administration of the Plan. Except to the extent prohibited by Applicable Law, the Administrator may delegate to one or more individuals the day-to-day
administration of the Plan and any of the functions assigned to it in this Plan. Such delegation may be revoked at any time. 
  
 (b) Powers of the Administrator. Subject to the provisions of the Plan and, in the case of a Committee or delegates acting as the Administrator,
subject to the specific duties delegated to such Committee or delegates, the Administrator shall have the authority, in its discretion: 
  
 (i) to select the Service Providers of the Company or its Affiliates to whom Awards are to be granted hereunder; 
  
 (ii) to determine the number of shares of Common Stock to be
covered by each Award granted hereunder; 
  
 (iii) to determine the type of Award to be granted to the selected Service Provider; 
  
 (iv) to approve forms of Award Agreements for use under the Plan; 
  
 (v) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any Award granted
hereunder. Such terms and conditions include, but are 
  

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 not limited to, the exercise and/or purchase price, the time or times when an Award may be exercised
(which may or may not be based on performance criteria), the vesting schedule, any vesting and/or exercisability, acceleration or waiver of forfeiture restrictions, the acceptable forms of consideration, the term, and any restriction or limitation
regarding any Award or the Shares relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine and may be established at the time an Award is granted or thereafter; 
  
 (vi) to correct administrative errors; 
  
 (vii) to construe and interpret the terms of the Plan
(including sub-plans and Plan addenda) and Awards granted pursuant to the Plan; 
  
 (viii) to adopt rules and procedures relating to the operation and administration of the Plan to accommodate the specific requirements of
local laws and procedures. Without limiting the generality of the foregoing, the Administrator is specifically authorized (A) to adopt the rules and procedures regarding the conversion of local currency, withholding procedures and handling of stock
certificates which vary with local requirements and (B) to adopt sub-plans and Plan addenda as the Administrator deems desirable, to accommodate foreign laws, regulations and practice; 
  
 (ix) to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and
regulations relating to sub-plans and Plan addenda; 
  
 (x) to modify or amend each Award, including, but not limited to, the acceleration of vesting and/or exercisability, provided, however, that any such amendment is subject to Section 16 of the Plan and may not impair any outstanding Award
unless agreed to in writing by the Participant; 
  
 (xi) to allow Participants to satisfy withholding tax amounts by electing to have the Company withhold from the Shares to be issued pursuant to an Award that number of Shares having a Fair Market Value equal to the amount required to be
withheld. The Fair Market Value of the Shares to be withheld shall be determined in such manner and on such date that the Administrator shall determine or, in the absence of provision otherwise, on the date that the amount of tax to be withheld is
to be determined. All elections by a Participant to have Shares withheld for this purpose shall be made in such form and under such conditions as the Administrator may provide; 
  
 (xii) to authorize conversion or substitution under the Plan of any or all stock options, stock appreciation
rights or other stock awards held by service providers of an entity acquired by the Company (the “Conversion Awards”). Any conversion or substitution shall be effective as of the close of the merger or acquisition. The Conversion Awards
may be Nonstatutory Stock Options or Incentive Stock Options, as determined by the Administrator, with respect to options granted by the acquired entity. Unless otherwise determined by the Administrator at the time of conversion or substitution, all
Conversion Awards shall have the same terms and conditions as Awards generally granted by the Company under the Plan; 
  

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 (xiii) to authorize any person to execute on behalf of the Company any instrument
required to effect the grant of an Award previously granted by the Administrator; 
  
 (xiv) to allow a Participant to defer the receipt of the payment of cash or the delivery of Shares that would otherwise be due to such
Participant under an Award; 
  
 (xv) to implement
an Award Transfer Program; 
  
 (xvi) to determine
whether Awards will be settled in Shares, cash or in any combination thereof; 
  
 (xvii) to determine whether Awards will be adjusted for Dividend Equivalents; 
  
 (xviii) to establish a program whereby Service Providers designated by the Administrator can reduce compensation otherwise payable in cash
in exchange for Awards under the Plan; 
  
 (xix)
to impose such restrictions, conditions or limitations as it determines appropriate as to the timing and manner of any resales by a Participant or other subsequent transfers by the Participant of any Shares issued as a result of or under an Award,
including, without limitation, (A) restrictions under an insider trading policy and (B) restrictions as to the use of a specified brokerage firm for such resales or other transfers; 
  
 (xx) to provide, either at the time an Award is granted or by subsequent action, that an Award shall contain
as a term thereof, a right, either in tandem with the other rights under the Award or as an alternative thereto, of the Participant to receive, without payment to the Company, a number of Shares, cash or a combination thereof, the amount of which is
determined by reference to the value of the Award; 
  
 (xxi) to institute an Exchange Program; and 
  
 (xxii) to make all other determinations deemed necessary or advisable for administering the Plan and any Award granted hereunder. 
  
 (c) Effect of Administrator’s Decision. All decisions, determinations and interpretations by the Administrator regarding the Plan, any rules
and regulations under the Plan and the terms and conditions of any Award granted hereunder, shall be final and binding on all Participants. The Administrator shall consider such factors as it deems relevant, in its sole and absolute discretion, to
making such decisions, determinations and interpretations, including, without limitation, the recommendations or advice of any officer or other employee of the Company and such attorneys, consultants and accountants as it may select. 
  
 5. Eligibility. Awards may be granted to Service Providers of the Company or
any of its Affiliates. 
  

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 6. Term of Plan. The Plan shall become effective upon the effective date of approval of the Plan by
stockholders of the Company. It shall continue in effect for a term of ten years from the later of the date the Plan or any amendment to add shares to the Plan is approved by stockholders of the Company unless terminated earlier under Section 16 of
the Plan. 
  
 7. Term of Award. The term of each Award shall be
determined by the Administrator and stated in the Award Agreement. In the case of an Option, the term shall be ten years from the Grant Date or such shorter term as may be provided in the Award Agreement. 
  
 8. Options. The Administrator may grant an Option or provide for the grant of
an Option, either from time to time in the discretion of the Administrator or automatically upon the occurrence of specified events, including, without limitation, the achievement of performance goals, the satisfaction of an event or condition
within the control of the Awardee or within the control of others. 
  
 (a) Option Agreement. Each Option Agreement shall contain provisions regarding (i) the number of Shares that may be issued upon exercise of the Option, (ii) the type of Option, (iii) the exercise price of the Shares and the means of
payment for the Shares, (iv) the term of the Option, (v) such terms and conditions on the vesting and/or exercisability of an Option as may be determined from time to time by the Administrator, (vi) restrictions on the transfer of the Option and
forfeiture provisions, and (vii) such further terms and conditions, in each case not inconsistent with this Plan, as may be determined from time to time by the Administrator. 
  
 (b) Exercise Price. The per share exercise price for the Shares to be issued pursuant to exercise of an Option shall
be determined by the Administrator, subject to the following: 
  
 (i) In the case of an Incentive Stock Option, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the Grant Date. Notwithstanding the foregoing, if any Employee to whom an
Incentive Stock Option is granted is a 10% Stockholder, then the exercise price shall not be less than 110% of the Fair Market Value of a share of Common Stock on the Grant Date. 
  
 (ii) In the case of a Nonstatutory Stock Option, the per Share exercise price shall be determined by the
Administrator. The per Share exercise price may also vary according to a predetermined formula. However, in the case of a Nonstatutory Stock Option intended to qualify as “performance-based compensation” within the meaning of Section
162(m) of the Code, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the Grant Date. 
  
 (iii) Notwithstanding the foregoing, so long as the issuance and sale of securities under this Plan require qualification under the
California Corporate Securities Law of 1968, the per Share exercise price of an Option shall be determined by the Administrator but shall not be less than 85% (or 110% in the case of a person who owns on the date of grant of such Option, securities
of the Company possessing more than 10% of the total combined voting power of all classes of stock of the Company or any Related Corporation) of the Fair Market Value of a share of Common Stock on the Grant Date. 
  

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 (iv) Notwithstanding the foregoing, at the Administrator’s discretion, Conversion
Awards may be granted in substitution and/or conversion of options of an acquired entity, with a per Share exercise price of less than 100% of the Fair Market Value per Share on the date of such substitution and/or conversion. 
  
 (c) Vesting Period and Exercise Dates. Options granted under this Plan
shall vest and/or be exercisable at such time and in such installments during the period prior to the expiration of the Option’s term as determined by the Administrator. The Administrator shall have the right to make the timing of the ability
to exercise any Option granted under this Plan subject to continued service, the passage of time and/or such performance requirements as deemed appropriate by the Administrator. At any time after the grant of an Option, the Administrator may reduce
or eliminate any restrictions surrounding any Participant’s right to exercise all or part of the Option. Notwithstanding the foregoing, so long as the issuance and sale of securities under this Plan require qualification under the California
Corporate Securities Law of 1968, an Option awarded to anyone other than an Officer, Director or Consultant of the Company shall vest at a rate of at least 20% per year. 
  
 (d) Form of Consideration. The Administrator shall determine the acceptable form of consideration for exercising an
Option, including the method of payment, either through the terms of the Option Agreement or at the time of exercise of an Option. Acceptable forms of consideration may include: 
  
 (i) cash; 
  
 (ii) check or wire transfer; 
  
 (iii) subject to any conditions or limitations established by the Administrator, other Shares which (A) in the case of Shares acquired
upon the exercise of an Option, have been owned by the Participant for more than six months on the date of surrender or attestation and (B) have a Fair Market Value on the date of surrender or attestation equal to the aggregate exercise price of the
Shares as to which said Option shall be exercised; 
  
 (iv) consideration received by the Company under a broker-assisted sale and remittance program acceptable to the Administrator; 
  
 (v) such other consideration and method of payment for the issuance of Shares to the extent permitted by Applicable Laws; or 

 
 (vi) any combination of the foregoing methods of payment.

  
 (e) Buyout Provisions. The Administrator may at any
time offer to buy out for a payment in cash or Shares an Option previously granted based on such terms and conditions as the Administrator shall establish and communicate to the Participant at the time that such offer is made. 
  

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 9. Incentive Stock Option Limitations. 
  
 (a) Eligibility. Only employees (as determined in accordance with Section 3401(c) of the Code and the regulations
promulgated thereunder) of the Company or any of its Related Corporations may be granted Incentive Stock Options. 
  
 (b) $100,000 Limitation. Notwithstanding the designation “Incentive Stock Option” in an Option Agreement, if and 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 Awardee during any calendar year (under all plans of the Company and any of its Related Corporations) exceeds $100,000,
such Options shall be treated as Nonstatutory Stock Options. An Incentive Stock Option is considered to be first exercisable during a calendar year if the Incentive Stock Option will become exercisable at any time during the year, assuming that any
condition on the Awardee’s ability to exercise the Incentive Stock Option related to the performance of services is satisfied. If the Awardee’s ability to exercise the Incentive Stock Option in the year is subject to an acceleration
provision, then the Incentive Stock Option is considered first exercisable in the calendar year in which the acceleration provision is triggered. For purposes of this Section 9(b), Incentive Stock Options shall be taken into account in the order in
which they were granted. However, because an acceleration provision is not taken into account prior to its triggering, an Incentive Stock Option that becomes exercisable for the first time during a calendar year by operation of such provision does
not affect the application of the $100,000 limitation with respect to any Incentive Stock Option (or portion thereof) exercised prior to such acceleration. The Fair Market Value of the Shares shall be determined as of the Grant Date. 
  
 (c) Leave of Absence. For purposes of Incentive Stock Options, no
leave of absence may exceed three months, unless reemployment upon expiration of such leave is provided by statute or contract. If reemployment upon expiration of a leave of absence approved by the Company or a Related Corporation is not so provided
by statute or contract, an Awardee’s employment with the Company shall be deemed terminated on the first day immediately following such three month period of leave for Incentive Stock Option purposes and any Incentive Stock Option granted to
the Awardee shall cease to be treated as an Incentive Stock Option and shall terminate upon the expiration of the three month period following the date the employment relationship is deemed terminated. 
  
 (d) Transferability. The Option Agreement must provide that an
Incentive Stock Option cannot be transferable by the Awardee otherwise than by will or the laws of descent and distribution, and, during the lifetime of such Awardee, must not be exercisable by any other person. Notwithstanding the foregoing, the
Administrator, in its sole discretion, may allow the Awardee to transfer his or her Incentive Stock Option to a trust where under Section 671 of the Code and other Applicable Law, the Awardee is considered the sole beneficial owner of the Option
while it is held in the trust. If the terms of an Incentive Stock Option are amended to permit transferability, the Option will be treated for tax purposes as a Nonstatutory Stock Option. 
  
 (e) Exercise Price. The per Share exercise price of an Incentive Stock Option shall be determined by the
Administrator in accordance with Section 8(b)(i) of the Plan. 
  

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 (f) 10% Stockholder. If any Employee to whom an Incentive Stock Option is granted is a 10%
Stockholder, then the Option term shall not exceed five years measured from the date of grant of such Option. 
  
 (g) Other Terms. Option Agreements evidencing Incentive Stock Options shall contain such other terms and conditions as may be necessary to qualify,
to the extent determined desirable by the Administrator, with the applicable provisions of Section 422 of the Code. 
  
 10. Exercise of Option. 
  
 (a) Procedure for Exercise; Rights as a Stockholder. 
  
 (i) Any Option granted hereunder shall be exercisable according to the terms of the Plan and at such times and under such conditions as
determined by the Administrator and set forth in the respective Award Agreement. 
  
 (ii) An Option shall be deemed exercised when the Company receives (A) written or electronic notice of exercise (in accordance with the
Award Agreement) from the person entitled to exercise the Option; (B) full payment for the Shares with respect to which the related Option is exercised; and (C) with respect to Nonstatutory Stock Options, payment of all applicable withholding taxes.

  
 (iii) Shares issued upon exercise of an
Option shall be issued in the name of the Participant or, if requested by the Participant, in the name of the Participant and his or her spouse. Unless provided otherwise by the Administrator or pursuant to this Plan, until the Shares are issued (as
evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to the Shares subject to an
Option, notwithstanding the exercise of the Option. 
  
 (iv) The Company shall issue (or cause to be issued) such Shares as soon as administratively practicable after the Option is exercised. An Option may not be exercised for a fraction of a Share. 
  
 (b) Effect of Termination of Service on Options. 
  
 (i) Generally. Unless otherwise provided for by the
Administrator, if a Participant ceases to be a Service Provider, other than upon the Participant’s death or Total and Permanent Disability, the Participant may exercise his or her Option within such period of time as is specified in the Award
Agreement to the extent that the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Award Agreement). Notwithstanding the foregoing, so long as the issuance and sale
of securities under this Plan require qualification under the California Corporate Securities Law of 1968, upon Participant’s Termination of Service, other than due to death, Total and Permanent Disability, or cause, the Participant may
exercise his or her Option (i) at any time on or prior to the date determined by the Administrator, which date shall be at least 30 days subsequent to the Participant’s termination date (but in no event later than the expiration of the term of
such Option), and 
  

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 (ii) only to the extent that the Participant was entitled to exercise such Option on the termination
date. In the absence of a specified time in the Award Agreement, the vested portion of the Option will remain exercisable for three months following the Participant’s termination. Unless otherwise provided by the Administrator, if on the date
of termination the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option will revert to the Plan. If after termination the Participant does not exercise his or her Option within the time
specified by the Administrator, the Option will terminate, and the Shares covered by such Option will revert to the Plan. 
  
 (ii) Disability of Awardee. Unless otherwise provided for by the Administrator, if a Participant ceases to be a Service Provider as
a result of the Participant’s Total and Permanent Disability, the Participant may exercise his or her Option within such period of time as is specified in the Award Agreement to the extent the Option is vested on the date of termination (but in
no event later than the expiration of the term of such Option as set forth in the Award Agreement). Notwithstanding the foregoing, so long as the issuance and sale of securities under this Plan require qualification under the California Corporate
Securities Law of 1968, in the event of Participant’s Termination of Service due to his or her Total and Permanent Disability, the Participant may exercise his or her Option (i) at any time on or prior to the date determined by the
Administrator, which date shall be at least six months subsequent to the termination date (but in no event later than the expiration date of the term of his or her Option), and (ii) only to the extent that the Participant was entitled to exercise
such Option on the termination date. In the absence of a specified time in the Award Agreement, the Option will remain exercisable for twelve months following the Participant’s termination. Unless otherwise provided by the Administrator, if at
the time of disability the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option will immediately revert to the Plan on the date of the Participant’s disability. If the Option is not
so exercised within the time specified herein, the Option will terminate, and the Shares covered by such Option will revert to the Plan 
  
 (iii) Death of Awardee. Unless otherwise provided for by the Administrator, if a Participant dies while a Service Provider, the
Option may be exercised following the Participant’s death within such period of time as is specified in the Award Agreement to the extent that the Option is vested on the date of death (but in no event may the Option be exercised later than the
expiration of the term of such Option as set forth in the Award Agreement), by the Participant’s designated beneficiary, provided such beneficiary has been designated prior to Participant’s death in a form acceptable to the Administrator.
Notwithstanding the foregoing, so long as the issuance and sale of securities under this Plan require qualification under the California Corporate Securities Law of 1968, in the event that the Participant dies prior to a Termination of Service, the
Participant’s Option may be exercised by the Participant’s designated beneficiary (i) at any time on or prior to the date determined by the Administrator, which date shall be at least six months subsequent to the date of death (but in no
event later than the expiration date of the term of his or her Option), and (ii) only to the extent that the Participant was entitled to exercise the Option at the date of death. If no such beneficiary has been designated by 
  

 13 

 the Participant, then such Option may be exercised by the personal representative of the
Participant’s estate or by the person(s) to whom the Option is transferred pursuant to the Participant’s will or in accordance with the laws of descent and distribution. In the absence of a specified time in the Award Agreement, the Option
will remain exercisable for twelve months following Participant’s death. Unless otherwise provided by the Administrator, if at the time of death Participant is not vested as to his or her entire Option, the Shares covered by the unvested
portion of the Option will immediately revert to the Plan on the date of the Participant’s death. If the Option is not so exercised within the time specified herein, the Option will terminate, and the Shares covered by such Option will revert
to the Plan. 
  
 11. Stock Awards. 
  
 (a) Stock Award Agreement. Each Stock Award Agreement shall contain
provisions regarding (i) the number of Shares subject to such Stock Award or a formula for determining such number, (ii) the purchase price of the Shares, if any, and the means of payment for the Shares, (iii) the performance criteria, if any, and
level of achievement versus these criteria that shall determine the number of Shares granted, issued, retained and/or vested, (iv) such terms and conditions on the grant, issuance, vesting and/or forfeiture of the Shares as may be determined from
time to time by the Administrator, (v) restrictions on the transferability of the Stock Award and (vi) such further terms and conditions in each case not inconsistent with this Plan as may be determined from time to time by the Administrator.

  
 Notwithstanding the foregoing, so long as the issuance and
sale of securities under this Plan require qualification under the California Corporate Securities Law of 1968, the purchase price for restricted Shares shall be determined by the Administrator, but shall not be less than 85% (or 100% in the case of
a person who owns on the date of grant of such restricted stock, securities of the Company possessing more than 10% of the total combined voting power of all classes of stock of the Company or any Related Corporation) of the Fair Market Value of a
share of Common Stock on the date of grant of such restricted stock. 
  
 (b) Restrictions and Performance Criteria. The grant, issuance, retention and/or vesting of each Stock Award may be subject to such performance criteria and level of achievement versus these criteria as the Administrator shall
determine, which criteria may be based on financial performance, personal performance evaluations and/or completion of service by the Awardee. Notwithstanding the foregoing, so long as the issuance and sale of securities under this Plan require
qualification under the California Corporate Securities Law of 1968, restricted stock awarded to anyone other than an Officer, Director or Consultant of the Company shall vest at a rate of at least 20% per year. 
  
 Notwithstanding anything to the contrary herein, the performance criteria for
any Stock Award that is intended to satisfy the requirements for “performance-based compensation” under Section 162(m) of the Code shall be established by the Administrator based on one or more Qualifying Performance Criteria selected by
the Administrator and specified in writing not later than 90 days after the commencement of the period of service to which the performance goals relates, provided that the outcome is substantially uncertain at that time. 
  

 14 

 (c) Forfeiture. Unless otherwise provided for by the Administrator, upon the Awardee’s
Termination of Service, the Stock Award and the Shares subject thereto shall be forfeited, provided that to the extent that the Participant purchased any Shares, the Company shall have a right to repurchase the unvested Shares at the original price
paid by the Participant. 
  
 (d) Rights as a Stockholder.
Unless otherwise provided by the Administrator, the Participant shall have the rights equivalent to those of a stockholder and shall be a stockholder only after Shares are issued (as evidenced by the appropriate entry on the books of the Company or
of a duly authorized transfer agent of the Company) to the Participant. Unless otherwise provided by the Administrator, a Participant holding Stock Units shall be entitled to receive dividend payments as if he or she was an actual stockholder.

  
 12. Stock Appreciation Rights. Subject to the terms and
conditions of the Plan, a SAR may be granted to a Service Provider at any time and from time to time as determined by the Administrator in its sole discretion. 
  

(a) Number of SARs. The Administrator shall have complete discretion to determine the number of SARs granted to any Service Provider.

  
 (b) Exercise Price and Other Terms. The Administrator,
subject to the provisions of the Plan, shall have complete discretion to determine the terms and conditions of SARs granted under the Plan. 
  
 (c) Exercise of SARs. SARs shall be exercisable on such terms and conditions as the Administrator, in its sole discretion, shall determine.

  
 (d) SAR Agreement. Each SAR grant shall be evidenced by
a SAR Agreement that will specify the exercise price, the term of the SAR, the conditions of exercise, and such other terms and conditions as the Administrator, in its sole discretion, shall determine. 
  
 (e) Expiration of SARs. A SAR granted under the Plan shall expire upon
the date determined by the Administrator, in its sole discretion, and set forth in the SAR Agreement. Notwithstanding the foregoing, the rules of Section 10(b) will also apply to SARs. 
  
 (f) Payment of SAR Amount. Upon exercise of a SAR, a Participant will be entitled to receive payment from the Company
in the amount determined by multiplying: (i) the difference between the Fair Market Value of a Share on the date of exercise over the exercise price; times (ii) the number of Shares with respect to which the SAR is exercised. At the discretion of
the Administrator, the payment upon SAR exercise may be in cash, Shares of equivalent value, other property or in some combination thereof. 
  
 (g) Buyout Provisions. The Administrator may at any time offer to buy out for a payment in cash or Shares a Stock Appreciation Right previously
granted based on such terms and conditions as the Administrator shall establish and communicate to the Participant at the time that such offer is made. 
  

 15 

 13. Cash Awards. Each Cash Award will confer upon the Participant the opportunity to earn a future payment
tied to the level of achievement with respect to one or more performance criteria established for a performance period. 
  
 (a) Cash Award. Each Cash Award shall contain provisions regarding (i) the performance goal(s) and maximum amount payable to the Participant as a
Cash Award, (ii) the performance criteria and level of achievement versus these criteria which shall determine the amount of such payment, (iii) the period as to which performance shall be measured for establishing the amount of any payment, (iv)
the timing of any payment earned by virtue of performance, (v) restrictions on the alienation or transfer of the Cash Award prior to actual payment, (vi) forfeiture provisions, and (vii) such further terms and conditions, in each case not
inconsistent with the Plan, as may be determined from time to time by the Administrator. The maximum amount payable as a Cash Award that is settled for cash may be a multiple of the target amount payable, but the maximum amount payable pursuant to
that portion of a Cash Award granted under this Plan for any fiscal year to any Awardee that is intended to satisfy the requirements for “performance based compensation” under Section 162(m) of the Code shall not exceed $5,000,000.

  
 (b) Performance Criteria. The Administrator shall
establish the performance criteria and level of achievement versus these criteria which shall determine the target and the minimum and maximum amount payable under a Cash Award, which criteria may be based on financial performance and/or personal
performance evaluations. The Administrator may specify the percentage of the target Cash Award that is intended to satisfy the requirements for “performance-based compensation” under Section 162(m) of the Code. Notwithstanding anything to
the contrary herein, the performance criteria for any portion of a Cash Award that is intended to satisfy the requirements for “performance-based compensation” under Section 162(m) of the Code shall be a measure established by the
Administrator based on one or more Qualifying Performance Criteria selected by the Administrator and specified in writing not later than 90 days after the commencement of the period of service to which the performance goals relates, provided that
the outcome is substantially uncertain at that time. 
  
 (c)
Timing and Form of Payment. The Administrator shall determine the timing of payment of any Cash Award. The Administrator may provide for or, subject to such terms and conditions as the Administrator may specify, may permit an Awardee to elect
for the payment of any Cash Award to be deferred to a specified date or event. The Administrator may specify the form of payment of Cash Awards, which may be cash or other property, or may provide for an Awardee to have the option for his or her
Cash Award, or such portion thereof as the Administrator may specify, to be paid in whole or in part in cash or other property. 
  
 (d) Termination of Service. The Administrator shall have the discretion to determine the effect of a Termination of Service due to (i) disability,
(ii) retirement, (iii) death, (iv) participation in a voluntary severance program, (v) participation in a work force restructuring or (vi) otherwise shall have on any Cash Award. 
  

 16 

 14. Other Provisions Applicable to Awards. 
  
 (a) Non-Transferability of Awards. Unless determined otherwise by the Administrator, an Award may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by beneficiary designation, will or by the laws of descent or distribution and may be exercised, during the lifetime of the Participant, only by the Participant.
The Administrator may make an Award transferable to an Awardee’s family member or any other person or entity. If the Administrator makes an Award transferable, either at the time of grant or thereafter, such Award shall contain such additional
terms and conditions as the Administrator deems appropriate, and any transferee shall be deemed to be bound by such terms upon acceptance of such transfer. 
  
 (b) Qualifying Performance Criteria. For purposes of this Plan, the term “Qualifying Performance Criteria” shall mean any one or more of
the following performance criteria, either individually, alternatively or in any combination, applied to either the Company as a whole or to a business unit, Affiliate or business segment, either individually, alternatively or in any combination,
and measured either annually or cumulatively over a period of years, on an absolute basis or relative to a pre-established target, to previous years’ results or to a designated comparison group, in each case as specified by the Committee in the
Award: (i) cash flow; (ii) earnings (including gross margin, earnings before interest and taxes, earnings before taxes, and net earnings); (iii) earnings per share; (iv) growth in earnings or earnings per share; (v) stock price; (vi) return on
equity or average stockholders’ equity; (vii) total stockholder return; (viii) return on capital; (ix) return on assets or net assets; (x) return on investment; (xi) revenue; (xii) income or net income; (xiii) operating income or net operating
income; (xiv) operating profit or net operating profit; (xv) operating margin; (xvi) return on operating revenue; (xvii) market share; (xviii) contract awards or backlog; (xix) overhead or other expense reduction; (xx) growth in stockholder value
relative to the moving average of the S&P 500 Index or a peer group index; (xxi) credit rating; (xxii) strategic plan development and implementation; (xxiii) improvement in workforce diversity, (xxiv) EBITDA, and (xxv) any other similar
criteria. The Committee may appropriately adjust any evaluation of performance under a Qualifying Performance Criteria to exclude any of the following events that occurs during a performance period: (A) asset write-downs; (B) litigation or claim
judgments or settlements; (C) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reported results; (D) accruals for reorganization and restructuring programs; and (E) any extraordinary non-recurring
items as described in Accounting Principles Board Opinion No. 30 and/or in management’s discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to stockholders for the applicable
year. 
  
 (c) Certification. Prior to the payment of any
compensation under an Award intended to qualify as “performance-based compensation” under Section 162(m) of the Code, the Committee shall certify the extent to which any Qualifying Performance Criteria and any other material terms under
such Award have been satisfied (other than in cases where such relate solely to the increase in the value of the Common Stock). 
  
 (d) Discretionary Adjustments Pursuant to Section 162(m). Notwithstanding satisfaction of any completion of any Qualifying Performance Criteria, to
the extent specified at the time of grant of an Award to “covered employees” within the meaning of Section 162(m) of 
  

 17 

 the Code, the number of Shares, Options or other benefits granted, issued, retained and/or vested under an Award on
account of satisfaction of such Qualifying Performance Criteria may be reduced by the Committee on the basis of such further considerations as the Committee in its sole discretion shall determine. 
  
 15. Adjustments upon Changes in Capitalization, Dissolution, Merger or Asset Sale.

  
 (a) Changes in Capitalization. Subject to any
required action by the stockholders of the Company, (i) the number and kind of Shares covered by each outstanding Award, and the number and kind of shares of Common Stock which have been authorized for issuance under the Plan but as to which no
Awards have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Award, (ii) the price per Share subject to each such outstanding Award, and (iii) the Share limitations set forth in Section 3 of the Plan,
shall be proportionately adjusted for any increase or decrease in the number or kind of issued shares resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been “effected without
receipt of consideration.” Such adjustment shall be made by the Administrator, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any
class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Common Stock subject to an Award. 
  
 (b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each Participant as soon as practicable prior to the effective date of such proposed transaction. The Administrator in its discretion may provide for an Option to be fully
vested and exercisable until ten days prior to such transaction. In addition, the Administrator may provide that any restrictions on any Award shall lapse prior to the transaction, provided the proposed dissolution or liquidation takes place at the
time and in the manner contemplated. To the extent it has not been previously exercised, an Award will terminate immediately prior to the consummation of such proposed transaction. 
  
 (c) Change in Control. In the event there is a Change in Control of the Company, as determined by the Board or a
Committee, the Board or Committee may, in its discretion, (i) provide for the assumption or substitution of, or adjustment to, each outstanding Award; (ii) accelerate the vesting of Options and SARs and terminate any restrictions on Stock Awards or
Cash Awards; and (iii) provide for the cancellation of Awards for a cash payment to the Participant. 
  
 16. Amendment and Termination of the Plan. 
  
 (a) Amendment and Termination. The Administrator may amend, alter or discontinue the Plan or any Award Agreement, but any such amendment shall be subject to approval of the stockholders of the Company in the
manner and to the extent required by Applicable Law. 
  

 18 

 (b) Effect of Amendment or Termination. No amendment, suspension or termination of the Plan shall
impair the rights of any Award, unless mutually agreed otherwise between the Participant and the Administrator, which agreement must be in writing and signed by the Participant and the Company. Termination of the Plan shall not affect the
Administrator’s ability to exercise the powers granted to it hereunder with respect to Awards granted under the Plan prior to the date of such termination. 
  

(c) Effect of the Plan on Other Arrangements. Neither the adoption of the Plan by the Board or a Committee nor the submission of the Plan to the
stockholders of the Company for approval shall be construed as creating any limitations on the power of the Board or any Committee to adopt such other incentive arrangements as it or they may deem desirable, including, without limitation, the
granting of restricted stock or stock options otherwise than under the Plan, and such arrangements may be either generally applicable or applicable only in specific cases. 
  
 17. Designation of Beneficiary. 
  
 (a) An Awardee may file a written designation of a beneficiary who is to receive the Awardee’s rights pursuant to Awardee’s Award or the Awardee
may include his or her Awards in an omnibus beneficiary designation for all benefits under the Plan. To the extent that Awardee has completed a designation of beneficiary such beneficiary designation shall remain in effect with respect to any Award
hereunder until changed by the Awardee to the extent enforceable under Applicable Law. 
  
 (b) Such designation of beneficiary may be changed by the Awardee at any time by written notice. In the event of the death of an Awardee and in the absence of a beneficiary validly designated under the Plan who is
living at the time of such Awardee’s death, the Company shall allow the executor or administrator of the estate of the Awardee to exercise the Award, or if no such executor or administrator has been appointed (to the knowledge of the Company),
the Company, in its discretion, may allow the spouse or one or more dependents or relatives of the Awardee to exercise the Award to the extent permissible under Applicable Law. 
  
 18. No Right to Awards or to Service. No person shall have any claim or right to be granted an Award and the grant of any
Award shall not be construed as giving an Awardee the right to continue in the service of the Company or its Affiliates. Further, the Company and its Affiliates expressly reserve the right, at any time, to dismiss any Service Provider or Awardee at
any time without liability or any claim under the Plan, except as provided herein or in any Award Agreement entered into hereunder. 
  
 19. Legal Compliance. Shares shall not be issued pursuant to the exercise of an Option or Stock Award unless the exercise of such Option or Stock Award and
the issuance and delivery of such Shares shall comply with Applicable Laws and shall be further subject to the approval of counsel for the Company with respect to such compliance. 
  
 20. Inability to Obtain Authority. To the extent the Company is unable to or the Administrator deems that it is not feasible
to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful 
  

 19 

 issuance and sale of any Shares hereunder, the Company shall be relieved of any liability with respect to the failure to
issue or sell such Shares as to which such requisite authority shall not have been obtained. 
  
 21. Reservation of Shares. The Company, during the term of this Plan, will at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan.

  
 22. Notice. Any written notice to the Company required by any
provisions of this Plan shall be addressed to the Secretary of the Company and shall be effective when received. 
  
 23. Governing Law; Interpretation of Plan and Awards. 
  
 (a) This Plan and all determinations made and actions taken pursuant hereto shall be governed by the substantive laws, but not the choice of law rules, of
the state of Nevada. 
  
 (b) In the event that any provision of
the Plan or any Award granted under the Plan is declared to be illegal, invalid or otherwise unenforceable by a court of competent jurisdiction, such provision shall be reformed, if possible, to the extent necessary to render it legal, valid and
enforceable, or otherwise deleted, and the remainder of the terms of the Plan and/or Award shall not be affected except to the extent necessary to reform or delete such illegal, invalid or unenforceable provision. 
  
 (c) The headings preceding the text of the sections hereof are inserted
solely for convenience of reference, and shall not constitute a part of the Plan, nor shall they affect its meaning, construction or effect. 
  
 (d) The terms of the Plan and any Award shall inure to the benefit of and be binding upon the parties hereto and their respective permitted heirs,
beneficiaries, successors and assigns. 
  
 (e) All questions
arising under the Plan or under any Award shall be decided by the Administrator in its total and absolute discretion. In the event the Participant believes that a decision by the Administrator with respect to such person was arbitrary or capricious,
the Participant may request arbitration with respect to such decision. The review by the arbitrator shall be limited to determining whether the Administrator’s decision was arbitrary or capricious. This arbitration shall be the sole and
exclusive review permitted of the Administrator’s decision, and the Awardee shall as a condition to the receipt of an Award be deemed to explicitly waive any right to judicial review. 
  
 24. Limitation on Liability. The Company and any Affiliate which is in
existence or hereafter comes into existence shall not be liable to a Participant, an Employee, an Awardee or any other persons as to: 
  
 (a) The Non-Issuance of Shares. The non-issuance or sale of Shares as to which the Company has been unable to obtain from any regulatory body
having jurisdiction the authority deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any shares hereunder; and 
  

 20 

 (b) Tax Consequences. Any tax consequence expected, but not realized, by any Participant,
Employee, Awardee or other person due to the receipt, exercise or settlement of any Option or other Award granted hereunder. 
  
 25. Unfunded Plan. Insofar as it provides for Awards, the Plan shall be unfunded. Although bookkeeping accounts may be established with respect to Awardees
who are granted Stock Awards under this Plan, any such accounts will be used merely as a bookkeeping convenience. The Company shall not be required to segregate any assets which may at any time be represented by Awards, nor shall this Plan be
construed as providing for such segregation, nor shall the Company nor the Administrator be deemed to be a trustee of stock or cash to be awarded under the Plan. Any liability of the Company to any Participant with respect to an Award shall be based
solely upon any contractual obligations which may be created by the Plan; no such obligation of the Company shall be deemed to be secured by any pledge or other encumbrance on any property of the Company. Neither the Company nor the Administrator
shall be required to give any security or bond for the performance of any obligation which may be created by this Plan. 
  
 IN WITNESS WHEREOF, the Company, by its duly authorized officer, has executed this Plan, effective as of
                        . 
  

									
	 	 	 	 	 	 	 Axesstel, Inc.,
 a Nevada
corporation
  

					
	Date:	 	 	 	 	 	By:	 	 
					
	 	 	 	 	 	 	Its:	 	 

  

 21Warrant Agreement

 Exhibit 10.43 
  
 THE SECURITIES WHICH ARE THE SUBJECT OF THIS AGREEMENT HAVE NOT BEEN QUALIFIED WITH THE COMMISSIONER OF CORPORATIONS OF THE STATE OF
CALIFORNIA AND THE ISSUANCE OF SUCH SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR PRIOR TO SUCH QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT FROM QUALIFICATION BY SECTION 25100, 25102, OR 25105
OF THE CALIFORNIA CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS SO EXEMPT. 
  
 THE SECURITIES WHICH ARE THE SUBJECT OF THIS AGREEMENT HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE
SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES
ACT OF 1933 
  
 AXESSTEL, INC. 
 WARRANT AGREEMENT 
  
 Axesstel, Inc., a California corporation, has granted to
                         (the “Holder”) a warrant (the “Warrant”) to
purchase                                     
(            ) shares of Stock upon the terms and conditions set forth in this Warrant Agreement (the “Warrant Agreement”). By signing this Warrant Agreement,
the Holder: (a) represents that the Holder has read and is familiar with the terms and conditions of this Warrant Agreement, including the Effect of Termination of Service set forth in Section 7, (b) accepts the Warrant subject to all of the terms
and conditions of this Warrant Agreement, (c) agrees to accept as binding, conclusive and final all decisions or interpretations of the Board upon any questions arising under this Warrant Agreement, and (d) acknowledges receipt of a copy of this
Warrant Agreement. 
  
 1. Definitions and
Construction. 
  
 1.1 Definitions.
Whenever used herein, the following terms shall have their respective meanings set forth below: 
  
 (a) “Board” means the Board of Directors of the Company, or a committee of the Board duly appointed to administer
this Warrant and having such powers as shall be specified by the Board. 
  
 (b) “Code” means the Internal Revenue Code of 1986, as amended, and any applicable regulations promulgated thereunder. 
  
 (c) “Company” means Axesstel, Inc., a California corporation, or any successor
corporation thereto. 
  

 1 

 (d) “Consultant” means a person engaged to provide consulting or
advisory services (other than as an Employee or a Director) to a Participating Company, provided that the identity of such person, the nature of such services or the entity to which such services are provided would not preclude the Company from
offering or selling securities to such person pursuant to this Agreement in reliance on either the exemption from registration provided by Rule 701 under the Securities Act or, if the Company is required to file reports pursuant to Section 13 or
15(d) of the Exchange Act, registration on a Form S-8 Registration Statement under the Securities Act. 
  
 (e) “Date of Warrant Grant” means
                    . 
  
 (f) “Director” means a member of the Board or of the board of directors of any other Participating Company.

  
 (g) “Disability”
means the inability of the Holder, in the opinion of a qualified physician acceptable to the Company, to perform the major duties of the Holder’s position with the Participating Company Group because of the sickness or injury of the Holder.

  
 (h) “Employee” means
any person treated as an employee (including an officer or a Director who is also treated as an employee) in the records of a Participating Company; provided, however, that neither service as a Director nor payment of a director’s fee shall be
sufficient to constitute employment for purposes of this Agreement. The Company shall determine in good faith and in the exercise of its discretion whether an individual has become or has ceased to be an Employee and the effective date of such
individual’s employment or termination of employment, as the case may be. 
  
 (i) “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
  
 (j) “Exercise Price” means
$             per share. 
  
 (k) “Fair Market Value” means, as of any date, the value of a share of Stock or other property as determined by
the Board, in its discretion, or by the Company, in its discretion, if such determination is expressly allocated to the Company herein, subject to the following: 
  
 (i) If, on such date, the Stock is listed on a national or regional securities exchange or market system,
the Fair Market Value of a share of Stock shall be the closing price of a share of Stock (or the mean of the closing bid and asked prices of a share of Stock if the Stock is so quoted instead) as quoted on the Nasdaq National Market, The Nasdaq
SmallCap Market or such other national or regional securities exchange or market system constituting the primary market for the Stock, as reported in The Wall Street Journal or such other source as the Company deems reliable. If the relevant
date does not fall on a day on which the Stock has traded on such securities exchange or market system, the date on which the Fair Market Value shall be established shall be the last day on which the Stock was so traded prior to the relevant date,
or such other appropriate day as shall be determined by the Board, in its discretion. 
  

 2 

 (ii) If, on such date, the Stock is not listed on a national or regional securities
exchange or market system, the Fair Market Value of a share of Stock shall be as determined by the Board in good faith without regard to any restriction other than a restriction which, by its terms, will never lapse. 
  
 (l) “Initial Exercise Date” means
                    . 
  
 (m) “Initial Vesting Date” means
                    . 
  
 (n) “Insider” means an officer or a Director of the Company or any other person whose transactions in Stock are
subject to Section 16 of the Exchange Act. 
  
 (o) “Number of Vested Shares” shall have the meaning given in Section 4.1 hereof. 
  
 (p) “Parent Corporation” means any present or future “parent corporation” of the Company, as defined in
Section 424(e) of the Code. 
  
 (q)
“Participating Company” means the Company or any Parent Corporation or Subsidiary Corporation. 
  
 (r) “Participating Company Group” means, at any point in time, all corporations collectively which are then
Participating Companies. 
  
 (s)
“Securities Act” means the Securities Act of 1933, as amended. 
  
 (t) “Service” means the Holder’s employment or service with the Participating Company Group, whether in the
capacity of an Employee, a Director or a Consultant. The Holder’s Service shall not be deemed to have terminated merely because of a change in the capacity in which the Holder renders Service to the Participating Company Group or a change in
the Participating Company for which the Holder renders such Service, provided that there is no interruption or termination of the Holder’s Service. Furthermore, the Holder’s Service with the Participating Company Group shall not be deemed
to have terminated if the Holder takes any military leave, sick leave, or other bona fide leave of absence approved by the Company; provided, however, that if any such leave exceeds ninety (90) days, on the ninety-first (91st) day of such leave the
Holder’s Service shall be deemed to have terminated unless the Holder’s right to return to Service with the Participating Company Group is guaranteed by statute or contract. Notwithstanding the foregoing, unless otherwise designated by the
Company or required by law, a leave of absence shall not be treated as Service for purposes of determining vesting under this Warrant Agreement. The Holder’s Service shall be deemed to have terminated either upon an actual termination of
Service or upon the corporation for which the Holder performs Service ceasing to be a Participating Company. Subject to the foregoing, the Company, in its discretion, shall determine whether the Holder’s Service has terminated and the effective
date of such termination. 
  
 (u)
“Stock” means the common stock of the Company, as adjusted from time to time in accordance with Section 9. 
  

 3 

 (v) “Subsidiary Corporation” means any present or future
“subsidiary corporation” of the Company, as defined in Section 424(f) of the Code. 
  
 (w) “Warrant Expiration Date” means the date which is ten (10) years after the Date of Warrant Grant. 

 
 1.2 Construction. Captions and titles contained
herein are for convenience only and shall not affect the meaning or interpretation of any provision of this Warrant Agreement. Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the
singular. Use of the term “or” is not intended to be exclusive, unless the context clearly requires otherwise. 
  
 2. Tax Status of Warrant. This Warrant is intended to be a nonstatutory stock option and shall not be treated as an “incentive stock
option” within the meaning of Section 422(b) of the Code. 
  
 3. Administration. 
  
 All questions of
interpretation concerning this Warrant Agreement shall be determined by the Board. All determinations by the Board shall be final and binding upon all persons having an interest in the Warrant. Any officer of a Participating Company shall have the
authority to act on behalf of the Company with respect to any matter, right, obligation, or election which is the responsibility of or which is allocated to the Company herein, provided the officer has apparent authority with respect to such matter,
right, obligation, or election. 
  
 4. Exercise of the
Warrant. 
  
 4.1 Right to
Exercise. Except as otherwise provided herein, the Warrant shall be exercisable on and after the Initial Exercise Date and prior to the termination of the Warrant (as provided in Section 6) in an amount not to exceed the Number of Vested Shares
less the number of shares previously acquired upon exercise of the Warrant. Subject to Sections 8.2 and 9.2, the Number of Vested Shares as of any date shall be determined by multiplying the number of shares subject to this Warrant by 1/12 for each
completed three-month period of the Holder’s continuous service after the Initial Vesting Date until all such shares are vested. 
  
 4.2 Method of Exercise. Exercise of the Warrant shall be by written notice to the Company in the form of Exhibit A hereto (the
“Exercise Notice”) which must state the election to exercise the Warrant, the number of whole shares of Stock for which the Warrant is being exercised and such other representations and agreements as to the Holder’s
investment intent with respect to such shares as may be required pursuant to the provisions of this Warrant Agreement. The written notice must be signed by the Holder and must be delivered in person, by certified or registered mail, return receipt
requested, by confirmed facsimile transmission, or by such other means as the Company may permit, to the Chief Financial Officer of the Company, or other authorized representative of the Participating Company Group, prior to the termination of the
Warrant as set forth in Section 6, accompanied by full payment of the aggregate Exercise Price for the number of shares of Stock being purchased. The Warrant shall be deemed to be exercised upon receipt by the Company of such written notice, the
aggregate Exercise Price, and, if required by the Company, such executed agreement. 
  

 4 

 4.3 Payment of Exercise Price. Except as otherwise provided below, payment of the
aggregate Exercise Price for the number of shares of Stock for which the Warrant is being exercised shall be made (i) in cash, by check, or cash equivalent, (ii) by means of a Cashless Exercise, as defined below, or (iii) by any combination of the
foregoing. A “Cashless Exercise” means the delivery of a properly executed notice together with irrevocable instructions to a broker in a form acceptable to the Company providing for the assignment to the Company of the
proceeds of a sale or loan with respect to some or all of the shares of Stock acquired upon the exercise of the Warrant pursuant to a program or procedure approved by the Company (including, without limitation, through an exercise complying with the
provisions of Regulation T as promulgated from time to time by the Board of Governors of the Federal Reserve System). The Company reserves, at any and all times, the right, in the Company’s sole and absolute discretion, to decline to approve or
terminate any such program or procedure. 
  
 4.4
Tax Withholding. At the time the Warrant is exercised, in whole or in part, or at any time thereafter as requested by the Company, the Holder hereby authorizes withholding from payroll and any other amounts payable to the Holder, and
otherwise agrees to make adequate provision for (including by means of a Cashless Exercise to the extent permitted by the Company), any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Participating
Company Group, if any, which arise in connection with the Warrant, including, without limitation, obligations arising upon (i) the exercise, in whole or in part, of the Warrant, (ii) the transfer, in whole or in part, of any shares acquired upon
exercise of the Warrant, or (iii) the operation of any law or regulation providing for the imputation of interest. The Warrant is not exercisable unless the tax withholding obligations of the Participating Company Group are satisfied. Accordingly,
the Company shall have no obligation to deliver shares of Stock until the tax withholding obligations of the Participating Company Group have been satisfied by the Holder. 
  
 4.5 Certificate Registration. Except in the event the Exercise Price is paid by means of a Cashless
Exercise, the certificate for the shares as to which the Warrant is exercised shall be registered in the name of the Holder, or, if applicable, in the names of the heirs of the Holder. 
  
 4.6 Restrictions on Grant of the Warrant and Issuance of Shares. The grant of the Warrant and the
issuance of shares of Stock upon exercise of the Warrant shall be subject to compliance with all applicable requirements of federal, state or foreign law with respect to such securities. The Warrant may not be exercised if the issuance of shares of
Stock upon exercise would constitute a violation of any applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition,
the Warrant may not be exercised unless (i) a registration statement under the Securities Act shall at the time of exercise of the Warrant be in effect with respect to the shares issuable upon exercise of the Warrant or (ii) in the opinion of legal
counsel to the Company, the shares issuable upon exercise of the Warrant may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. THE HOLDER IS CAUTIONED THAT THE WARRANT MAY NOT
BE EXERCISED UNLESS THE FOREGOING CONDITIONS ARE SATISFIED. ACCORDINGLY, THE HOLDER MAY NOT BE ABLE TO EXERCISE THE WARRANT WHEN DESIRED EVEN THOUGH THE WARRANT IS VESTED. The inability of the 
  

 5 

 Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the
Company’s legal counsel to be necessary to the lawful issuance and sale of any shares subject to the Warrant shall relieve the Company of any liability in respect of the failure to issue or sell such shares as to which such requisite authority
shall not have been obtained. As a condition to the exercise of the Warrant, the Company may require the Holder to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to
make any representation or warranty with respect thereto as may be requested by the Company. Any shares which are issued will be “restricted securities” as that term is defined in Rule 144 under the Securities Act, as further described in
Section 7 of the Exercise Notice, unless they are registered under the Securities Act. The Company is under no obligation to register the shares of Stock issuable upon exercise of this Warrant. 
  
 4.7 Fractional Shares. The Company shall not be
required to issue fractional shares upon the exercise of the Warrant. 
  
 5. Nontransferability of the Warrant. 
  
 The Warrant may be exercised during the lifetime of the Holder only by the Holder or the Holder’s guardian or legal representative and may not be assigned or transferred in any manner except by will or by the laws of descent and
distribution. Following the death of the Holder, the Warrant, to the extent provided in Section 7, may be exercised by the Holder’s legal representative or by any person empowered to do so under the deceased Holder’s will or under the then
applicable laws of descent and distribution. 
  
 6.
Termination of the Warrant. 
  
 The Warrant shall
terminate and may no longer be exercised on the first to occur of (a) the Warrant Expiration Date, (b) the last date for exercising the Warrant following termination of the Holder’s Service as described in Section 7, or (c) a Change in Control
to the extent provided in Section 8. 
  
 7. Effect of
Termination of Service. 
  
 7.1
Warrant Exercisability. 
  
 (a)
Disability. If the Holder’s Service with the Participating Company Group terminates because of the Disability of the Holder, the Warrant, to the extent unexercised and exercisable on the date on which the Holder’s Service
terminated, may be exercised by the Holder (or the Holder’s guardian or legal representative) at any time prior to the expiration of six (6) months after the date on which the Holder’s Service terminated, but in any event no later than the
Warrant Expiration Date. 
  
 (b)
Death. If the Holder’s Service with the Participating Company Group terminates because of the death of the Holder, the Warrant, to the extent unexercised and exercisable on the date on which the Holder’s Service terminated,
may be exercised by the Holder’s legal representative or other person who acquired the right to exercise the Warrant by reason of the Holder’s death at any time prior to the expiration of six (6) months after the date on which the
Holder’s Service terminated, but in any event no later than the Warrant Expiration 
  

 6 

 Date. The Holder’s Service shall be deemed to have terminated on account of death if the Holder dies
within three (3) months after the Holder’s termination of Service. 
  
 (c) Other Termination of Service. If the Holder’s Service with the Participating Company Group terminates for any reason, except Disability or death, the Warrant, to the extent unexercised and
exercisable by the Holder on the date on which the Holder’s Service terminated, may be exercised by the Holder at any time prior to the expiration of three (3) months (or such other longer period of time as determined by the Board, in its
discretion) after the date on which the Holder’s Service terminated, but in any event no later than the Warrant Expiration Date. 
  
 7.2 Extension if Exercise Prevented by Law. Notwithstanding the foregoing, if the exercise of the Warrant within the applicable
time periods set forth in Section 7.1 is prevented by the provisions of Section 4.6, the Warrant shall remain exercisable until three (3) months after the date the Holder is notified by the Company that the Warrant is exercisable, but in any event
no later than the Warrant Expiration Date. 
  
 7.3 Extension if Option Unregistered. Notwithstanding the foregoing, if a registration statement under the Securities Act shall not be in effect with respect to the shares of Stock issuable upon exercise of the Warrant at the time
the Holder’s Service with the Participating Company Group terminates, the Warrant shall remain exercisable until three (3) months after the date the Holder is notified by the Company that either (i) such a registration statement is effective or
(ii) the Holder has been advised that in the opinion of legal counsel for the Company, all of the Shares may be sold immediately upon exercise in accordance with Rule 701 promulgated under the Securities Act, but in any event no later than the
Warrant Expiration Date. 
  
 7.4 Extension if
Holder Subject to Section 16(b). Notwithstanding the foregoing, if a sale within the applicable time periods set forth in Section 7.1 of shares acquired upon the exercise of the Warrant would subject the Holder to suit under Section 16(b) of the
Exchange Act, the Warrant shall remain exercisable until the earliest to occur of (i) the tenth (10th) day following the date on which a sale of such shares by the Holder would no longer be subject to such suit, (ii) the one hundred and ninetieth
(190th) day after the Holder’s termination of Service, or (iii) the Warrant Expiration Date. 
  
 8. Change In Control. 
  
 8.1 Definitions. 
  
 (a) An “Ownership Change Event” shall be deemed to have occurred if any of the following occurs with respect to
the Company: (i) the direct or indirect sale or exchange in a single or series of related transactions by the shareholders of the Company of more than fifty percent (50%) of the voting stock of the Company; (ii) a merger or consolidation in which
the Company is a party; (iii) the sale, exchange, or transfer of all or substantially all of the assets of the Company; or (iv) a liquidation or dissolution of the Company. 
  
 (b) A “Change in Control” shall mean an Ownership Change Event or a series of
related Ownership Change Events (collectively, a “Transaction”) wherein the 
  

 7 

 shareholders of the Company immediately before the Transaction do not retain immediately after the
Transaction, in substantially the same proportions as their ownership of shares of the Company’s voting stock immediately before the Transaction, direct or indirect beneficial ownership of more than fifty percent (50%) of the total combined
voting power of the outstanding voting stock of the Company or the corporation or corporations to which the assets of the Company were transferred (the “Transferee Corporation(s)”), as the case may be. For purposes of the
preceding sentence, indirect beneficial ownership shall include, without limitation, an interest resulting from ownership of the voting stock of one or more corporations which, as a result of the Transaction, own the Company or the Transferee
Corporation(s), as the case may be, either directly or through one or more subsidiary corporations. The Board shall have the right to determine whether multiple sales or exchanges of the voting stock of the Company or multiple Ownership Change
Events are related, and its determination shall be final, binding and conclusive. 
  
 8.2 Effect of Change in Control on Warrant. In the event of a Change in Control, the Number of Vested Shares shall thereafter be
equal to the number of shares subject to this Warrant. In addition, the surviving, continuing, successor, or purchasing corporation or parent corporation thereof, as the case may be (the “Acquiring Corporation”), may either
assume the Company’s rights and obligations under the Warrant or substitute for the Warrant a substantially equivalent Warrant for the Acquiring Corporation’s stock. Any vesting of the Warrant that was permissible solely by reason of this
Section 8.2 shall be conditioned upon the consummation of the Change in Control. The Warrant shall terminate and cease to be outstanding effective as of the date of the Change in Control to the extent that the Warrant is neither assumed or
substituted for by the Acquiring Corporation in connection with the Change in Control nor exercised as of the date of the Change in Control. Notwithstanding the foregoing, shares acquired upon exercise of the Warrant prior to the Change in Control
and any consideration received pursuant to the Change in Control with respect to such shares shall continue to be subject to all applicable provisions of this Warrant Agreement except as otherwise provided herein. Furthermore, notwithstanding the
foregoing, if the corporation the stock of which is subject to the Warrant immediately prior to an Ownership Change Event described in Section 8.1(a)(i) constituting a Change in Control is the surviving or continuing corporation and immediately
after such Ownership Change Event less than fifty percent (50%) of the total combined voting power of its voting stock is held by another corporation or by other corporations that are members of an affiliated group within the meaning of Section
1504(a) of the Code without regard to the provisions of Section 1504(b) of the Code, the Warrant shall not terminate unless the Board otherwise provides in its discretion. 
  
 9. Adjustments For Changes In Capital Structure. 
  
 9.1 Number, Exercise Price and Class of Stock. In the
event of any stock dividend, stock split, reverse stock split, recapitalization, combination, reclassification, or similar change in the capital structure of the Company, appropriate adjustments shall be made in the number, Exercise Price and class
of shares of stock subject to the Warrant. If a majority of the shares which are of the same class as the shares that are subject to the Warrant are exchanged for, converted into, or otherwise become (whether or not pursuant to an Ownership Change
Event) shares of another corporation (the “New Shares”), the Board may unilaterally amend the Warrant to provide that the Warrant is exercisable for New Shares. In the event of any such 
  

 8 

 amendment, the Number of Warrant Shares and the Exercise Price shall be adjusted in a fair and equitable
manner, as determined by the Board, in its discretion. Notwithstanding the foregoing, any fractional share resulting from an adjustment pursuant to this Section 9 shall be rounded down to the nearest whole number, and in no event may the Exercise
Price be decreased to an amount less than the par value, if any, of the stock subject to the Warrant. The adjustments determined by the Board pursuant to this Section 9 shall be final, binding and conclusive. 
  
 9.2 Going Public. In the event the Company becomes
subject to the reporting requirements under Section 13 or 15(d) of the Exchange Act, as a result of an initial public offering, voluntary registration under Section 12(g) of the Exchange Act, or an Ownership Change Event, the number of Vested Shares
shall thereafter be equal to the number of shares subject to the Warrant. 
  
 10. Rights as a Shareholder, Employee or Consultant. 
  
 The Holder shall have no rights as a shareholder with respect to any shares covered by the Warrant until the date of the issuance of a certificate for the
shares for which the Warrant has been exercised (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company). No adjustment shall be made for dividends, distributions or other rights for
which the record date is prior to the date such certificate is issued, except as provided in Section 9.1. If the Holder is an Employee, the Holder understands and acknowledges that, except as otherwise provided in a separate, written employment
agreement between a Participating Company and the Holder, the Holder’s employment is “at will” and is for no specified term. Nothing in this Warrant Agreement shall confer upon the Holder any right to continue in the Service of a
Participating Company or interfere in any way with any right of the Participating Company Group to terminate the Holder’s Service as an Employee or Consultant, as the case may be, at any time. 
  
 11. Lock-Up Agreement. 
  
 The Holder hereby agrees that in the event of any underwritten public
offering of stock, including but not limited to an initial public offering of stock, made by the Company pursuant to an effective registration statement filed under the Securities Act, the Holder shall not offer, sell, contract to sell, pledge,
hypothecate, grant any Warrant to purchase or make any short sale of, or otherwise dispose of any shares of stock of the Company or any rights to acquire stock of the Company for such period of time from and after the effective date of such
registration statement as may be established by the underwriter for such public offering; provided, however, that such period of time shall not exceed one hundred eighty (180) days from the effective date of the registration statement to be filed in
connection with such public offering. The foregoing limitation shall not apply to shares registered in the public offering under the Securities Act. 
  
 12. Legends. 
  
 The Company may at any time place legends referencing and any applicable federal, state or foreign securities law restrictions on all certificates
representing shares of stock subject to the provisions of this Warrant Agreement. The Holder shall, at the request of the Company, promptly present to the Company any and all certificates representing shares acquired 
  

 9 

 pursuant to the Warrant in the possession of the Holder in order to carry out the provisions of this Section. Unless
otherwise specified by the Company, legends placed on such certificates may include, but shall not be limited to, the following: 
  
 “THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD,
TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER THE ACT, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY, STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.” 
  
 13. Restrictions on Transfer of Shares. 
  
 No shares acquired upon exercise of the Warrant may be sold, exchanged, transferred (including, without limitation, any
transfer to a nominee or agent of the Holder), assigned, pledged, hypothecated or otherwise disposed of, including by operation of law, in any manner which violates any of the provisions of this Warrant Agreement and any such attempted disposition
shall be void. The Company shall not be required (a) to transfer on its books any shares which will have been transferred in violation of any of the provisions set forth in this Warrant Agreement or (b) to treat as owner of such shares or to accord
the right to vote as such owner or to pay dividends to any transferee to whom such shares will have been so transferred. 
  
 14. Miscellaneous Provisions. 
  
 14.1 Binding Effect. Subject to the restrictions on transfer set forth herein, this Warrant Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective heirs, executors, administrators, successors and assigns. 
  
 14.2 Termination or Amendment. The Board may terminate or amend the Warrant at any time; provided, however, that except as provided
in Section 8.2 in connection with a Change in Control, no such termination or amendment may adversely affect the Warrant or any unexercised portion hereof without the consent of the Holder unless such termination or amendment is necessary to comply
with any applicable law or government regulation. No amendment or addition to this Warrant Agreement shall be effective unless in writing. 
  
 14.3 Notices. Any notice required or permitted hereunder shall be given in writing and shall be deemed effectively given (except to
the extent that this Warrant Agreement provides for effectiveness only upon actual receipt of such notice) upon personal delivery or upon deposit in the United States Post Office, by registered or certified mail, with postage and fees prepaid,
addressed to the other party at the address shown below that party’s signature or at such other address as such party may designate in writing from time to time to the other party. 
  
 14.4 Integrated Agreement. This Warrant Agreement constitutes the entire understanding and agreement
of the Holder and the Participating Company Group with respect to the subject matter contained herein or therein and supersedes any prior agreements, 
  

 10 

 understandings, restrictions, representations, or warranties among the Holder and the Participating
Company Group with respect to such subject matter other than those as set forth or provided for herein. To the extent contemplated herein or therein, the provisions of the Warrant Agreement shall survive any exercise of the Warrant and shall remain
in full force and effect. 
  
 14.5 Applicable
Law. This Warrant Agreement shall be governed by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within the State of California. 
  
 14.6 Counterparts. This Warrant Agreement may be
executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 
  

							
	 THE COMPANY:
	 	 	 	 HOLDER:

			
	 AXESSTEL, INC.,
	 	 	 	 
	 a California corporation
	 	 	 	 
				
	By:	 	 	 	 	 	 

  

							
				
	Name:	 	 	 	 	 	 

  

							
				
	Title:	 	 	 	 	 	 

  

 11 

 EXHIBIT A 
  

			
		
	Holder:	 	 

  

			
		
	Date:	 	 

  
 WARRANT
EXERCISE NOTICE 
  
 Axesstel, Inc.

 Attention: Chief Financial Officer 
  

	
	
	 
	
	 

  
 Ladies and Gentlemen: 
  
 1. Warrant. I was
granted a Warrant (the “Warrant”) to purchase shares of the common stock (the “Shares”) of Axesstel, Inc., a California corporation (the “Company”), pursuant to a Warrant
Agreement (the “Warrant Agreement”) as follows: 
  

			
	 Date of Warrant Grant:
	 	 
		
	 Number of Warrant Shares:
	 	 

  

			
	 Exercise Price per Share:
	 	$                        

  
 Adjustments may have
occurred to the identity of the Company, the Number of Warrant Shares and the Exercise Price Per Share as a result of a change in capital structure as set forth in Section 9 of the Warrant Agreement, and if such adjustment has occurred, all
references to “Shares” and “Exercise Price” below refer to numbers and amounts giving effect to such adjustments, and to New Shares as defined in Section 9 of the Warrant Agreement to the extent applicable.

  
 2. Exercise of Warrant. I hereby elect to
exercise the Warrant to purchase the following number of Shares: 
  

			
	 Total Shares Purchased:
	  	 

  

				
		
	 Exercise Price Per Share or New Share
	  	$	                        
		
	 Total Exercise Price (Total Shares X Price per Share)
	  	$	                        

  
 3.
Payments. I enclose payment in full of the total exercise price for the Shares in the following form(s), as authorized by the Warrant Agreement: 
  

 1 

				
	  ̈ Cash:
	  	$	                        
		
	  ̈ Check:
	  	$	                        

  
 4. Tax
Withholding. I enclose payment in full of my withholding taxes, if any, as follows: 
  
 (Contact Chief Financial Officer for amount of tax due.) 
  

				
	  ̈ Cash:
	  	$	                        
		
	  ̈ Check:
	  	$	                        

  
 5. Holder
Information. 
  

			
	 My address is:
	  	 
		
	 	  	 

  

			
	 My Social Security Number is:
	  	 

  
 6. Binding
Effect. I agree that the Shares are being acquired in accordance with and subject to the terms, provisions and conditions of the Warrant Agreement, to all of which I hereby expressly assent. This Agreement shall inure to the benefit of and
be binding upon the my heirs, executors, administrators, successors and assigns. 
  
 7. Transfer. I understand and acknowledge that the Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and that consequently the
Shares must be held indefinitely unless they are subsequently registered under the Securities Act, an exemption from such registration is available, or they are sold in accordance with Rule 144 under the Securities Act. I further understand and
acknowledge that the Company is under no obligation to register the Shares. I understand that the certificate or certificates evidencing the Shares will be imprinted with legends which prohibit the transfer of the Shares unless they are registered
or such registration is not required in the opinion of legal counsel satisfactory to the Company. 
  
 I am aware that Rule 144 under the Securities Act, which permits limited public resale of securities acquired in a nonpublic offering, is not currently
available with respect to the Shares and, in any event, is available only if certain conditions are satisfied. I understand that any sale of the Shares that might be made in reliance upon Rule 144 may only be made in limited amounts in accordance
with the terms and conditions of such rule and that a copy of Rule 144 will be delivered to me upon request. 
  

 2 

 I understand that I am purchasing the Shares pursuant to the terms of the Warrant Agreement, which I have
received and carefully read and understand. 
  

	
	Very truly yours,
	
	 
	(Signature)

  
 Receipt of the above is hereby
acknowledged. 
  
 Axesstel, Inc. 
  

			
		
	By:	 	 
		
	Title:	 	 
		
	Dated:	 	 

  

 3 

 Table of Warrant Grants to Mike H.P. Kwon and Satoru Yukie 
  
 On May 1, 2002, Axesstel, Inc., a California corporation (“Axesstel
California”), issued and sold to Mike H.P. Kwon and Satoru Yukie warrants to purchase shares of the common stock of Axesstel California. The warrants are documented pursuant to the form of Warrant Agreement to which this table is attached.
These warrants were assumed by the registrant pursuant to the Corporate Combination Agreement dated July 16, 2002 as amended, between Axesstel California and the registrant (the “Combination Agreement”). The following table sets forth the
principal terms of the warrant grants: 
  

										
	 Name of Warrantholder

	  	Expiration Date

	  	# of Warrants Granted

	 	 	Exercise Price

	 
	 Mike H.P. Kwon
	  	5/1/2012	  	1,122,671	*	 	$	0.07	*
	 Satoru Yukie
	  	5/1/2012	  	1,210,367	*	 	$	0.07	*

  

	*	These numbers reflect the post-conversion amounts as set forth in the Combination Agreement.

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