Document:

GLOBAL
HEALTHCARE REIT, INC.

 

NON-QUALIFIED
STOCK OPTION AGREEMENT

 

This
Non-Qualified Stock Option Agreement (the “Agreement”) is attached as Exhibit A to a Notice of Grant of Stock
Option (the “Grant Notice”), pursuant to which Optionee has been informed of the basic terms of the option evidenced
thereby. Certain capitalized terms used but not otherwise defined herein have the respective meanings specified in the Grant Notice
to which this Agreement relates. 

 

THIS
NON-QUALIFIED STOCK OPTION AGREEMENT (the “Agreement”) is entered into between GLOBAL HEALTHCARE REIT, INC., a Utah
corporation (“Global” or the “Company”), and ZVI RHINE (“Optionee”), as of April 1, 2018 (the
“Grant Date”). In consideration of the mutual promises and covenants made herein, the parties hereby agree as follows:

 

	 	1.	Grant
    of Option. Subject to the terms and conditions set forth herein, Global grants to Optionee an option (the “Option”)
    to purchase 600,000 shares (the “Shares”) of Global’s common stock, $.05 par value (the “Common Stock”),
    at a price equal to U.S $0.36 per share (the “Option Price”). The Option Price has been determined by the Board
    of Directors.
	 	 	 
	 	 	The
    Option is not intended to qualify as an incentive stock option described in Section 422 of the Internal Revenue Code of 1986,
    as amended (the “Code”). All provisions of this Agreement are to be construed in conformity with this intention.
	 	 	 
	 	2.	Term.
    The Option shall be valid for a term commencing on the Grant Date and ending on the fifth anniversary of the Grant Date, as
    defined below (“Expiration Date”). In the event there is a cessation of Service by Optionee with Global for any
    reason, then all unvested Options shall immediately become null and void and cannot be exercised by Optionee. 
	 	 	 
	 	3.	Vesting.
    The Option may only be exercised to the extent vested. Options exercisable to purchase 150,000 shares of common stock
    shall vest immediately upon the Grant Date. Options exercisable to purchase an additional 150,000 shares of common stock shall
    vest 12 months following the Grant Date (a “Vesting Date”). Options exercisable to purchase an additional 150,000
    shares of common stock shall vest 18 months following the Grant Date. Options exercisable to purchase an additional 150,000
    shares of common stock shall vest 24 months following the Grant Date. Vesting is contingent upon Optionee continuing to provide
    Services to the Company on each Vesting Date. All unvested Options shall immediately vest in the event of a Change in Control
    of the Company. For purposes of this Agreement, a Change in Control shall mean any transaction of the Company involving (i)
    the merger or consolidation of the Company into or with another entity where the Company’s shareholders receive less
    than 50% of the outstanding voting securities of the new or continuing entity, (ii) the sale of all or substantially all of
    the Company’s assets, (iii) any person not already a stockholder of the Company becoming a beneficial owner, directly
    or indirectly, of the securities of the Company representing 50% or more of the combined voting power of the Company’s
    then outstanding securities, (iv) a change in the majority of the Board of Directors of the Company, or (v) the Company terminating
    its business or liquidating its assets.

 

    	 

    	 

    

 

	 	4.	Procedure
    for Exercise. Exercise of the Option, or a portion thereof, shall be effected by the giving of written notice to Global
    and payment of the aggregate Option Price for the number of Shares to be acquired pursuant to such exercise and completing
    the Purchase Form attached to this Option. In the event the issuance of the Shares upon exercise of this Option has not been
    registered under the Securities Act of 1933, as amended ( the “Securities Act”), the Optionee shall concurrently
    execute and deliver the Subscription Agreement and Representations and Warranties in the form attached hereto as Exhibits
    A and B, respectively.
	 	 	 
	 	5.	Manner
    of Payment.
	 	 	 
	 	 	a.
    The exercise price of each Option shall be paid, to the extent permitted by applicable statutes and regulations, either (i)
    in cash at the time the Option is exercised, (ii) by delivery to the Company of other Common Stock of the Company valued at
    its then established fair market value (as defined below), (iii) by delivery to the Company of either options or warrants
    of the Company including, without limitation, this Option, valued at the difference between their exercise price and the then
    established fair market value of the Company’s Common Stock, (iv) according to a deferred payment or other arrangement
    (which may include, without limiting the generality of the foregoing, the use of other Common Stock of the Company) with the
    holder hereof, or (v) any other form of legal consideration that may be acceptable to the Board of Directors, in their discretion.
    For the purposes of this Section 5, the fair market value of the Company’s Common Stock shall be defined as (i) the
    closing sale price for the Common Stock on the primary exchange upon which the shares are listed and traded on the date prior
    to the date the Option is exercised, or (ii) if the shares are not traded on any national exchange, the closing sale price
    for the Common Stock on the NASDAQ National Market on the date prior to the date the Option is exercised, or (iii) if the
    shares are neither traded on a national exchange nor listed on the NASDAQ National Market, then the average of the bid and
    ask prices for the Common Stock in the Over-The-Counter Market as quoted on the NASDAQ Capital Market, on the date prior to
    the date the Option is exercised, or (iv) if the shares of Common Stock are neither traded on a national exchange or the NASDAQ
    National Market nor quoted on the NASDAQ Capital Market, the average of the bid and ask prices for the Common Stock as quoted
    by any recognized securities quotation service such as the OTC Markets or the OTC Electronic Bulletin Board on the date prior
    to the date the Option is exercised, or (v) if the shares of Common Stock are not quoted on any recognized securities quotation
    service such as the OTC Markets, Inc., or the OTC Electronic Bulletin Board on the date prior to the date the Option is exercised,
    then the fair market value of the Company’s Common Stock shall be the price paid for the Company’s Common Stock
    in the most recent transaction involving the Company and a nonaffiliated purchaser in an arm’s length transaction (the
    “Fair Market Value”). In the case of any deferred payment arrangement, any interest shall be payable at least
    annually and shall be charged at the minimum rate of interest necessary to avoid the treatment as interest, under any applicable
    provisions of the Internal Revenue Code, of any amounts other than amounts stated to be interest under the deferred payment
    arrangement.

 

    	 

    	 

    

 

	 	 	(b)
    By way of example, in lieu of exercising this Option by payment with cash, certified check or wired funds, the Holder may
    elect to receive the number of Shares, as determined below, equal to the value of this Option (or the portion thereof being
    exercised) by surrender of this Option at the corporate office of the Company together with the duly executed form of subscription
    agreement and notice of such an election, in which event the Company shall issue to the Holder a number of shares of Common
    Stock computed using the following formula:

 

	X	=	Y(A-B)	 
	 	 	A	 

 

	 	Where:	X
    = the number of shares of Common Stock to be issued to the Holder
	 	 	Y
    = the gross number of shares of Common Stock to be purchased
	 	 	A
    = the Fair Market Value of one (1) share of the Company’s Common Stock on the day prior to exercise hereunder 
	 	 	B
    = Exercise Price

 

	 	6.	Options
    Not Transferable and Subject to Certain Restrictions. The Option may not be sold, pledged, assigned or transferred in
    any manner other than by will or the laws of descent and distribution, or pursuant to a qualified domestic relations order
    as defined in Section 414(p) of the Code. During Optionee’s lifetime, the Option may be exercised only by the Optionee
    or by a legally authorized representative. In the event of Optionee’s death, the Option may be exercised for a period
    of 90 days following the date of death by the distributee to whom Optionee’s rights under the Option shall pass by will
    or by the laws of descent and distribution.
	 	 	 
	 	7.	Acceptance
    of Agreement. Optionee hereby accepts and agrees to be bound by all the terms and conditions of this Agreement.
	 	 	 
	 	8.	No
    Right to Employment. Nothing herein contained shall confer upon Optionee any right to continuation of employment by Global
    or any Affiliate, or interfere with the right of Global or any Affiliate to terminate at any time the employment of Optionee.
    Nothing contained herein shall confer any rights upon Optionee as a stockholder of Global, unless and until Optionee actually
    exercises this Option and receives Shares.
	 	 	 
	 	9.	Compliance
    with Securities Laws. The Option shall not be exercisable and Shares shall not be issued pursuant to exercise of the Option
    unless the exercise of the Option and the issuance and delivery of Shares pursuant thereto shall comply with all relevant
    provisions of law.
	 	 	 
	 	10.	Adjustments.
    With respect to any unexercised portion of the Option, Global may make any adjustments necessary to prevent accretion,
    or to protect against dilution, in the number and kind of shares covered by the Option and in the applicable exercise price
    thereof in the event of a change in the corporate structure or shares of Global; provided, however, that no adjustment shall
    be made for the issuance of preferred stock of Global or the conversion of convertible preferred stock of Global. For purposes
    of this Section 10, a change in the corporate structure or shares of Global includes, without limitation, any change resulting
    from a recapitalization, stock split, stock dividend, consolidation, rights offering, spin-off, reorganization or liquidation,
    and any transaction in which shares of Common Stock are changed into or exchanged for a different number or kind of shares
    of stock or other securities of Global or another entity.

 

    	 

    	 

    

 

	 	11.	No
    Other Rights. Optionee hereby acknowledges and agrees that, except as set forth herein, no other representations or promises,
    either oral or written, have been made by Global, any Affiliate or anyone acting on their behalf with respect to Optionee’s
    right to acquire any shares of Common Stock, stock options or awards under the Agreement, and Optionee hereby releases, acquits
    and forever discharges Global, the Affiliates and anyone acting on their behalf of and from all claims, demands or causes
    of action whatsoever relating to any such representations or promises and waives forever any claim, demand or action against
    Global, any Affiliate or anyone acting on their behalf with respect thereto.
	 	 	 
	 	12.	Severability.
    Any provision of this Agreement (or portion thereof) that is deemed invalid, illegal or unenforceable in any jurisdiction
    shall, as to that jurisdiction and subject to this Section 14, be ineffective to the extent of such invalidity, illegality
    or unenforceability, without affecting in any way the remaining provisions thereof in such jurisdiction or rendering that
    or any other provisions of this Agreement invalid, illegal, or unenforceable in any other jurisdiction.
	 	 	 
	 	13.	Not
    used.
	 	 	 
	 	14.	Entire
    Agreement. This Agreement constitutes the entire agreement between the parties concerning the subject matter hereof and
    supersedes all prior and contemporaneous agreements, oral or written, between Global and Optionee relating to Optionee’s
    entitlement to stock options, Common Stock or similar benefits.
	 	 	 
	 	15.	Amendment.
    This Agreement may be amended and/or terminated at any time by mutual written agreement of Global and Optionee.
	 	 	 
	 	16.	No
    Third Party Beneficiary. Nothing in this Agreement, expressed or implied, is intended to confer on any person other than
    Optionee and Optionee’s respective successors and assigns expressly permitted herein, any rights, remedies, obligations
    or liabilities under or by reason of this Agreement.
	 	 	 
	 	17.	Governing
    Law. The construction and operation of this Agreement are governed by the laws of the State of Delaware.

 

Executed
as of the date first written above.

 

	 	GLOBAL
    HEALTHCARE REIT, INC.
	 	 	 
	 	By:
    	 
	 	Name:	Lance
Baller
	 	Title:	CEO
	 	 	 
	 	 
	 	Signature
    of Optionee
	 	 	 
	 	 
	 	Optionee’s
    Social Security Number

 

    	 

    	 

    

 

PURCHASE
FORM

 

Dated:
_____________

 

The
undersigned hereby irrevocably elects to exercise the attached Option to the extent of purchasing ________shares of Common Stock
and hereby makes payment of $________ in payment of the Exercise Price therefor.

 

	 	 
	 	Name:	

 

INSTRUCTIONS
FOR REGISTRATION OF STOCK

 

	Name	 
	 	(please
    typewrite or print in block letters)
	 	 
	Address	 
	 	 
	Signature	 

 

    	 

    	 

    

 

EXHIBIT
A

 

SUBSCRIPTION
AGREEMENT

 

Subscription
Agreement (the “Agreement”) made and entered into as of this _______ day of ___________, _____, between the
person whose name appears on the signature page hereof (“Subscriber”) and Global Healthcare REIT, Inc. , a Utah
corporation (“Company”);

 

WITNESSETH:

 

In
consideration of the mutual covenants hereinafter set forth, the parties hereto agree as follows:

 

	1.	Subscription.
    The Subscriber hereby subscribes for and agrees to purchase the number of shares of the Company’s Common Stock, $.05
    par value, set opposite his name on the signature page hereof (the “Shares”) for the purchase price of $0.36 per
    share, payable as hereinafter provided. The Subscriber hereby agrees that this Agreement shall be irrevocable and survive
    the death or legal incapacity of the Subscriber.
	 	 
	2.	Payment
    for Shares. The purchase price for the Shares shall be paid to the Company by the Subscriber contemporaneously with the
    execution of this Agreement. No certificates representing the Shares shall be issued or become issuable until the full amount
    of the above subscription shall have been paid. In the event the subscription price herein specified is not paid when due,
    the Company may at its option cancel this subscription and this Agreement.
	 	 
	3.	Acceptance
    of Subscription. This Agreement shall be deemed to be accepted by the Company when it is signed by an authorized officer
    of the Company on behalf of the Company, it being provided that, notwithstanding anything in this Agreement to the contrary,
    the Company shall have no obligation to issue the Shares to the Subscriber if the issuance of the Shares would constitute
    a violation of federal or state securities laws.
	 	 
	4.	Representations
    and Warranties of the Company. The Company represents and warrants to the Subscriber that:

 

	 	a.	The
    Company is duly incorporated, validly existing and in good standing under the laws of its state of incorporation, with full
    power and authority to conduct its business as it is currently being conducted and to own its assets. The Company is duly
    qualified to do business, and is in good standing as a foreign corporation authorized to do business, in all jurisdictions
    in which a failure to so qualify would have a material adverse effect on the business condition (financial or otherwise),
    earnings, properties, or results of operations of the Company, and its subsidiaries, taken as a whole.
	 	 	 
	 	b.	The
    Company has duly authorized the issuance and sale of the Shares upon the terms of this Agreement by all requisite corporate
    action.
	 	 	 
	 	c.	The
    Shares have been duly authorized and, when issued and paid for in accordance herewith, will be duly issued, fully paid and
    nonassessable shares of the Company.

 

    	 

    	 

    

 

	5.	Representations
    and Warranties of the Subscriber. The Subscriber hereby represents and warrants to and covenants with the Company and
    to each officer, director and agent of the Company as follows:

 

	 	a.	General.
	 	 	 	 
	 	 	i.	The
    Subscriber has all requisite authority to enter into this Agreement and to perform all the obligations required to be performed
    by the Subscriber hereunder.
	 	 	 	 
	 	 	ii.	The
    Subscriber is the sole party in interest and is not acquiring the Shares as an agent or otherwise for any other person.
	 	 	 	 
	 	 	iii.	The
    Subscriber is a resident of the State of Illinois.
	 	 	 	 
	 	 	iv.	The
    Subscriber is an “accredited investor” within the meaning of Rule 501(a) of Regulation D.
	 	 	 	 
	 	b.	Information
    Concerning the Company:
	 	 	 	 
	 	 	i.	The
    Subscriber is familiar with the business and financial condition, properties, operations and prospects of the Company, and,
    at a reasonable time prior to the execution of this Agreement, has been afforded the opportunity to ask questions of and receive
    satisfactory answers from the Company’s officers and directors, or other persons acting on the Company’s behalf,
    concerning the business and financial condition, properties, operations and prospects of the Company and concerning the terms
    and conditions of the offering of the Shares and has asked such questions as he desires to ask and all such questions have
    been answered to the full satisfaction of the Subscriber.
	 	 	 	 
	 	 	ii.	The
    Subscriber understands that the purchase of the Shares involves various risks, including, among others, the substantial risk
    that the Shares will become worthless due to the failure of the Company in the future.
	 	 	 	 
	 	 	iii.	No
    representations or warranties have been made to the Subscriber by the Company as to the tax consequences of this investment,
    or as to profits, losses or cash flow which may be received or sustained as a result of this investment.
	 	 	 	 
	 	 	iv.	All
    documents, records and books pertaining to a proposed investment in the Shares which the Subscriber has requested have been
    made available to the Subscriber.
	 	 	 	 
	 	c.	Status
    of the Subscriber. The Subscriber is able to bear the economic risk of this investment. The Subscriber has had the opportunity
    to consult with the Subscriber’s own attorney, accountant and/or purchaser representative regarding the Subscriber’s
    investment in the Shares and their suitability for purchase by the Subscriber, and to the extent necessary, the Subscriber
    has retained, at Subscriber’s own expense, and relied upon, appropriate professional advice regarding the investment,
    tax and legal merits, risks ad consequences of this Agreement and of purchasing and owning the Shares.

 

    	 

    	 

    

 

	 	d.	Restrictions
    on Transfer or Sale of the Shares:
	 	 	 	 
	 	 	i.	The
    Subscriber is acquiring the Shares subscribed for solely for the Subscriber’s own beneficial account, for investment
    purposes, and not with a view to or for resale in connection with, any distribution of Shares. The Subscriber understands
    that the offer and sale of the Shares has not been registered under the Securities Act of 1933 (the “Securities Act”)
    or the securities laws of any state by reason of specific exemptions under the provisions thereof which depend in part upon
    the investment intent of the Subscriber and of the other representations made by the Subscriber in this Agreement. The Subscriber
    understands that the Company is relying upon the representations, covenants and agreements contained in this Agreement (and
    any supplemental information) for the purpose of determining whether this transaction meets the requirements for such exemptions.
	 	 	 	 
	 	 	ii.	The
    Subscriber understands that if the issuance of the Shares has not been registered under the Securities Act, the Shares are
    “restricted securities” under applicable federal securities laws and that the Securities Act and the rules of
    the Securities and Exchange Commission provide in substance that the Subscriber may dispose of the Shares only pursuant to
    an effective registration statement under the Securities Act or an exemption therefrom, and the Subscriber understands that
    the Company has no obligation or intention to register any of the Shares purchased by the Subscriber thereunder or to take
    action so as to permit sales pursuant to the Securities Act (including Rule 144 thereunder). The Subscriber understands that
    the Subscriber may not at any time demand the purchase by the Company of the Subscriber’s Shares.
	 	 	 	 
	 	 	iii.	The
    Subscriber agrees: (A) that the Subscriber will not sell, assign, pledge, give, transfer or otherwise dispose of the Shares
    or any interest therein, or make any offer or attempt to do any of the foregoing, except (i) pursuant to a registration of
    the Shares under the Securities Act and all applicable state securities laws or in a transaction which is exempt from the
    registration provisions of the Securities Act and all applicable state securities laws, and (ii) in accordance with the stock
    transfer restrictions described in Section 6 hereof; (B) that the Company and any transfer agent for the Shares shall not
    be required to give effect to any purported transfer of any of the Shares except upon compliance with the foregoing restrictions;
    and (C) that legends in substantially the following form will be placed on the certificates representing the Shares:

 

    	 

    	 

    

 

THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN TAKEN WITHOUT A VIEW TO THE DISTRIBUTION THEREOF WITHIN THE MEANING OF THE SECURITIES
ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE WITH SUCH ACT
AND THE RULES AND REGULATIONS THEREUNDER AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THE COMPANY WILL NOT TRANSFER
SUCH SHARES EXCEPT UPON RECEIPT OF A FAVORABLE OPINION OF ITS COUNSEL AND/OR EVIDENCE SATISFACTORY TO THE COMPANY THAT THE REGISTRATION
PROVISIONS OF SUCH ACT HAVE BEEN COMPLIED WITH OR THAT SUCH REGISTRATION IS NOT REQUIRED AND THAT SUCH TRANSFER WILL NOT VIOLATE
ANY APPLICABLE STATE SECURITIES LAWS.

 

The
Subscriber has not offered or sold any portion of the subscribed for Shares and has no present intention of dividing such Shares
with others or of reselling or otherwise disposing of any portion of such Shares either currently or after the passage of a fixed
or determinable period of time or upon the occurrence or nonoccurrence of any predetermined event or circumstance.

 

	6.	Notices. All notices and other communications provided for herein shall be in writing and shall be deemed to have been duly given if delivered personally or sent by registered or certified mail, return receipt requested, postage prepaid:
	 	 	 	 
	 	a.	To
    the Company at the following address:	 
	 	 	 	 
	 	b.	To
    the Subscriber at the following address:	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	7.	Assignability; Amendment. This Agreement is not assignable by the Subscriber, and may not be modified, waived or terminated except by an instrument in writing signed by the party against whom enforcement of such modification, waiver or termination is sought.
	 	 
	8.	Binding Effect. Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the parties and their heirs, executors, administrators, successors, legal representatives and assigns, and the agreements, representations, warrantee and acknowledgments contained herein shall be deemed to be made by and be binding upon such heirs, executors, administrators, successors, legal representatives and assigns.
	 	 
	9.	Entire Agreement. This Agreement constitutes the entire agreement of the Subscriber and the Company relating to the matters contained herein, superseding all prior contract or agreements, whether oral or written.
	 	 
	10.	Governing Law. This Agreement shall be governed and controlled as to validity, enforcement, interpretation, construction and effect and in all other aspects by the substantive laws of the State of Colorado, without reference to conflicts of laws principles. Venue for all purposes hereunder shall be Denver, Colorado.

 

    	 

    	 

    

 

	11.	Severability.
    If any provisions of this Agreement or the application thereof to any Subscriber or circumstance shall be held invalid
    or unenforceable to any extent, the remainder of this Agreement and the applicability of such provision to other subscriptions
    or circumstances shall not be affected thereby and shall be enforced to the greatest extent permitted by law.
	 	 
	12.	Headings.
    The headings in this Agreement are inserted for convenience and identification only and are not intended to describe,
    interpret, define, or limit the scope, extent or intent of this Agreement or any provision hereof.

 

IN
WITNESS WHEREOF, the undersigned Subscriber has executed this Agreement as of the date and year first above written.

 

	 	THE
    COMPANY:
	 	 
	 	GLOBAL
    HEALTHCARE REIT, INC.
	 	 	                
	 	By:
    	 
	 	Name:
    	 
	 	Title:
    	 
	 	 	 
	 	SUBSCRIBER:
	 	 	 
	 	 
	 	Name:
	 

	 	Number
    of Shares Subscribed: _________

 

    	 

    	 

    

 

EXHIBIT
B

 

REPRESENTATIONS
AND WARRANTIES STATEMENT

 

By
his execution below, the undersigned specifically warrants and represents to Global Healthcare REIT, Inc. (“Company”)
that:

 

	1.	The
    Shares are being or will be purchased by the undersigned for investment only, for his own account, and not with a view to
    the offer, resale, or redistribution thereof.
	 	 
	2.	The
    undersigned is not and will not be participating, directly or indirectly, in an underwriting of any of the Shares, and the
    undersigned will not take, or cause to be taken, any action that would cause him to be deemed to be an underwriter of the
    Shares, as that term is defined in applicable provisions of the Securities Act of 1933, as amended, and the regulations promulgated
    pursuant to that Act.
	 	 
	3.	The
    undersigned has had an opportunity to ask questions of, and receive answers from, the management of the Company and persons
    acting on behalf of the Company, concerning the terms and conditions of this investment, and all such questions have been
    answered to the full satisfaction of the undersigned. The undersigned has had an opportunity to make a prudent and full inquiry
    into the business and financial affairs of the Company.
	 	 
	4.	The
    undersigned is able to bear the economic risk of an investment in the Shares, and has sufficient net worth to sustain a loss
    of the entire investment without material economic hardship if such a loss should occur.
	 	 
	5.	The
    undersigned is aware that an investment in the Shares is speculative and involves a high degree of risk of loss by the undersigned
    of his entire investment in the Shares. The undersigned is capable of bearing such economic risks.
	 	 
	6.	The
    financial condition of the undersigned is such that he is under no present or contemplated future need to dispose of any portion
    of the Shares to satisfy any existing or contemplated undertaking, need, or indebtedness. The undersigned understands that
    the nature of the investment is such that the undersigned will probably not be able to sell the Shares for a long period of
    time, and no one has represented to the undersigned that the undersigned will be able to sell the Shares or otherwise realize
    any return on his investment within any given period of time. In particular, the undersigned acknowledges that the Shares
    will have no market in the foreseeable future. No assurances have been made to the undersigned regarding any economic gain
    which may inure to the undersigned by reason of ownership of the Shares.
	 	 
	7.	By
    reason of the undersigned’s knowledge and experience in financial and business matters in general, and investments in
    particular, he is capable of evaluating the merits and risks of an investment by him in the Shares.
	 	 
	8.	The
    undersigned recognizes that the Shares have not and will not have been registered under the Securities Act of 1933, as amended,
    nor under the securities laws of any state. The undersigned agrees not to sell the Shares without registering them under the
    Securities Act of 1933 and any applicable state securities laws unless exemptions from such registration requirements are
    available with respect to any such sales, and agrees that a legend may be placed on his stock certificates to such effect.

 

    	 

    	 

    

 

	9.	The
    undersigned acknowledges that his ability to sell, transfer, convey, pledge or hypothecate the Shares shall be subject to
    the terms of the Bylaws of the Company to be ratified and confirmed by the undersigned contemporaneously with his execution
    hereof.

 

The
undersigned understands that these representations and warranties are being or will be relied upon by the Company in issuing the
Shares to the undersigned.

 

Executed
on _____________________________.

 

	 	 
	 	Name:EMPLOYMENT
AGREEMENT

 

THIS
EMPLOYMENT AGREEMENT (“Agreement”) made and entered into this 1st day of April, 2018, to be effective as of the 1st
day of January, 2018 (the “Effective Date”), by and between GLOBAL HEALTHCARE REIT, a Utah corporation (the “Company”)
and ZVI RHINE (the “Executive”).

 

W
I T N E S S E T H:

 

WHEREAS,
the Company wishes to secure the services of the Executive subject to the contractual terms and conditions set forth herein; and

 

WHEREAS,
the Executive is willing to enter into this Agreement upon the terms and conditions set forth herein.

 

NOW,
THEREFORE, in consideration of the mutual promises and agreements set forth herein, the parties hereto agree as follows:

 

1.       Employment.
The Company hereby agrees to employ the Executive, and the Executive hereby agrees to accept such employment with the Company,
all upon the terms and conditions set forth herein.

 

2.       Term
of Employment. Subject to the terms and conditions of this Agreement, the Executive shall be employed for a term commencing
on the Effective Date and ending on the second (2nd) anniversary of the Effective Date (the “Term”) unless sooner
terminated as provided for herein. The Term shall renew automatically for additional one (1) year terms, unless either party gives
written notice no less than ninety (90) days prior to the expiration of the Term that it does not intend to extend the Term.

 

3.       Duties
and Responsibilities

 

A.       Capacity.
During the Term, the Executive shall serve in the capacity of President and Chief Financial Officer subject to the supervision
of the Board of Directors of the Company (the “Board”).

 

B.       Full-Time
Duties. During the Term, and excluding any periods of disability, vacation or sick leave to which the Executive is entitled,
the Executive shall devote all of his business time, attention and energies to the business of the Company. During the Term, it
shall not be a violation of this Agreement for the Executive to (i) serve on corporate, civic or charitable boards or committees,
(ii) deliver lectures or fulfill speaking engagements and (iii) manage personal investments, including Sabra Capital Partners,
LLC (a business which Executive owns and managed prior to entering this Agreement) so long as such activities do not materially
interfere with the performance of the Executive’s responsibilities as an employee of the Company in accordance with this
Agreement.

 

    	1

     

    

 

C.       Standard
of Performance. The Executive will perform his duties under this Agreement with fidelity and loyalty, to the best of his ability,
experience and talent and in a manner consistent with his duties and responsibilities.

 

4.       Compensation.

 

A.       Base
Salary. During the Term, as compensation for Executive’s services hereunder, the Company shall pay the Executive an
annual base salary (the “Base Salary”) at the rate of One Hundred Sixty-Five Thousand Dollars ($165,000) per year,
which rate may be increased during the Term hereof if and to the extent approved by the Board of Directors of the Company. The
Base Salary shall be payable in equal installments in accordance with the Company’s normal payroll practices, but in no
event less frequently than monthly. It is agreed that payment of the Executive’s base salary, retroactive to the Effective
Date, will commence upon the Company’s closing of additional financing in the aggregate amount of at least $600,000, but
in no event later than May 31, 2018. Base Salary shall be reduced by the value of any benefits provided to Executive. During the
remainder of the Term, the Base Salary shall be reviewed at least annually by the Board after consultation with the Executive
and may from time to time be increased (but not decreased) as solely determined by the Board. Effective as of the date of any
such increase, the Base Salary as so increased shall be considered the new Base Salary for all purposes of this Agreement and
may not thereafter be reduced. Any increase in Base Salary shall not limit or reduce any other obligation of the Company to the
Executive under this Agreement.

 

B.       Annual
Performance Bonus. The Executive may be eligible for annual discretionary bonus awards payable in cash or common stock of
the Company, as so determined solely by the Company, based on performance objectives determined annually by the Board.

 

C.       Long-Term
Incentives. Upon the execution of this Agreement, the Company agrees to award the Executive (i) the initial option award set
forth on the term sheet attached hereto as Exhibit A; and (ii) 150,000 shares of the Company’s common stock, which will
be an award of restricted stock and will vest with respect to one-half of such shares on each of the first and second anniversaries
of the Effective Date. Following the initial option and restricted stock awards, the Executive shall be eligible for grants of
stock options, restricted stock and/or other long-term incentives in the discretion of the Board on the same basis as other similarly
situated senior executives of the Company. In addition, in the event the Company pursues additional rounds of equity financing
during the Term, the Executive shall be offered the option to purchase, at the price offered in such financing, a sufficient additional
equity interest such that if the Executive exercises this purchase option, the Executive will maintain his proportionate ownership
interest in the Company.

 

D.       Benefits.

 

(1)       If
and to the extent that the Company maintains employee benefit plans (including, but not limited to, pension, profit-sharing, disability,
accident, medical, life insurance, and hospitalization plans) (it being understood that the Company may but shall not be obligated
to do so), the Executive shall be entitled to participate therein in accordance with the Company’s regular practices with
respect to similarly situated senior executives that currently have been granted options. The Company will have the right to amend
or terminate any such benefit plans it may choose to establish.

 

    	2

     

    

 

(2)       The
Executive shall be entitled to prompt reimbursement from the Company for reasonable out-of-pocket expenses incurred by him in
the course of the performance of his duties hereunder, upon the submission of appropriate documentation in accordance with the
practices, policies and procedures applicable to other senior executives of the Company.

 

(3)       The
Executive shall be entitled to such vacation, holidays and other paid or unpaid leaves of absence as are consistent with the Company’s
normal policies available to other senior executives of the Company or as are otherwise approved by the Board. Executive acknowledges
that except for one (1) week of paid vacation per year and paid holidays recognized by the New York Stock Exchange, no other benefits
are offered as of the date of this Agreement.

 

5.       Termination
of Employment.

 

Notwithstanding
the provisions of Section 2 hereof, the Executive’s employment hereunder shall terminate under any of the following conditions:

 

A.       Death.
The Executive’s employment under this Agreement shall terminate automatically upon his death.

 

B.       Total
Disability. The Company shall have the right to terminate this Agreement if the Executive becomes Totally Disabled. For purposes
of this Agreement, “Totally Disabled” means that the Executive is not working and is currently unable to perform the
substantial and material duties of his position hereunder as a result of sickness, accident or bodily injury for a period of three
months. Prior to a determination that Executive is Totally Disabled, but after Executive has exhausted all sick leave and vacation
benefits provided by the Company, Executive shall continue to receive his Base Salary, offset by any disability benefits he may
be eligible to receive.

 

C.       Termination
by Company for Cause. The Executive’s employment hereunder may be terminated for Cause upon written notice by the Company.
For purposes of this Agreement, “Cause” shall mean:

 

		(1)	conviction
                                         of the Executive by a court of competent jurisdiction of any felony or a crime involving
                                         moral turpitude;

 

		(2)	the
                                         Executive’s willful and intentional failure or willful and intentional refusal
                                         to follow reasonable and lawful instructions of the Board;

 

		(3)	the
                                         Executive’s material breach or default in the performance of his obligations under
                                         this Agreement that results in a significant financial detriment to the Company;

 

		(4)	the
                                         Executive’s act of misappropriation, embezzlement, intentional fraud or similar
                                         conduct involving the Company.

 

    	3

     

    

 

Executive
may not be terminated for Cause pursuant to subsections (2) and (3) above unless Executive is given written notice of the circumstances
constituting “Cause” and a reasonable period to cure such circumstances, which period shall be no less than ten (10)
days.

 

D.       Termination
for Good Reason. The Executive’s employment hereunder may be terminated by the Executive for Good Reason on written
notice by Executive to the Company. For purposes of this Agreement, “Good Reason” means the occurrence of any of the
following circumstances without the Executive’s consent:

 

		(1)	a
                                         material reduction in the Executive’s salary or benefits excluding the substitution
                                         of substantially equivalent compensation and benefits;

 

		(2)	a
                                         material diminution of the Executive’s duties, authority or responsibilities as
                                         in effect immediately prior to such diminution;

 

		(3)	the
                                         relocation of the Executive’ principal work location to a location more than 50
                                         miles from its current location; or

 

		(4)	the
                                         failure of a successor to assume and perform under this Agreement.

 

6.       Payments
Upon Termination.

 

A.       Upon
termination of Executive’s employment hereunder for any reason as so provided for in Section 5 hereof, the Company shall
be obligated to pay and the Executive shall be entitled to receive, within ten (10) days of termination, Base Salary which has
accrued for services performed to the date of termination and which has not yet been paid. In addition, the Executive shall be
entitled to any benefits to which he is entitled under the terms of any applicable Executive benefit plan or program, restricted
stock plan and stock option plan of the Company, and, to the extent applicable, short-term or long-term disability plan or program
with respect to any disability, or any life insurance policies and the benefits provided by such plan, program or policies, or
applicable law.

 

B.       Upon
termination of Executive’s employment by the Company without Cause or by the Executive for Good Reason, the Company shall
be obligated to pay and the Executive shall be entitled to receive:

 

(1)       all
of the amounts and benefits described in Section 6.A. hereof; and

 

(2)       a
lump sum payment, within 10 days of termination, equal to 50% of Executive’s annual Base Salary; and

 

    	4

     

    

 

(3)       an
additional amount equal to 50% of Executive’s annual Base Salary payable in six equal monthly installments following the
date of termination; and

 

(4)       continued
participation in all Executive welfare benefit programs of the Company for the remainder of the Term or, if longer, until the
first anniversary of the Executive’s termination of employment, as if there had been no termination of employment.

 

Payments
under Section 6.B., with the exception of amounts due pursuant to Section 6.B(1), are conditioned on the execution by the Executive
of a release of all employment-related claims; provided, however, that such release shall be contingent upon the Company’s
satisfaction of all terms and conditions of this Section.

 

C.       Upon
termination of the Executive’s employment upon the death of Executive pursuant to Section 5.A., the Company shall be obligated
to pay, and the Executive shall be entitled to receive:

 

(1)       all
of the amounts and benefits described in Section 6.A.;

 

(2)       any
death benefit payable under a plan or policy provided by the Company; and

 

(3)       continued
participation by the Executive’s dependents in the welfare benefit programs of the Company for the remainder of the Term
or, if longer, until the first anniversary of the Executive’s termination of employment, as if there had been no termination
of employment.

 

D.       Upon
termination of the Executive’s employment upon the Disability of the Executive pursuant to Section 5.B., the Company shall
be obligated to pay, and the Executive shall be entitled to receive:

 

(1)       all
of the amounts and benefits described in Section 6.A.;

 

(2)       the
Base Salary, at the rate in effect immediately prior to the date of his termination of employment due to Disability, for the remainder
of the Term, offset by any payments the Executive receives under the Company’s long-term disability plan and any supplements
thereto, whether funded or unfunded, which is adopted by the Company for the Executive’s benefit and not attributable to
the Executive’s own contributions; and

 

(3)       continued
participation by the Executive and his dependents in the welfare benefit programs of the Company for the remainder of the Term
or, if longer, until the first anniversary of the Executive’s termination of employment, as if there had been no termination
of employment.

 

    	5

     

    

 

E.       Upon
the termination of Executive’s employment upon the consummation of a Change in Control transaction, as defined below, the
Company shall be obligated to pay and Executive shall be entitled to receive:

 

(1)       All
of the amounts and bendfits described in Section 6.A; and

 

(2)       An
amount equal to 100% of Executive’s annual Base Salary payable within ten days of the date of such termination.

 

Payments
under Section 6.D. or 6.E, with the exception of amounts due pursuant to Section 6.D(1), are conditioned on the execution by the
Executive or the Executive’s representative of a release of all employment-related claims; provided, however, that such
release shall be contingent upon the Company’s satisfaction of all terms and conditions of this Section.

 

F.       Upon
voluntary termination of employment by the Executive for any reason whatsoever (other than for Good Reason as described in Section
6.B.) or termination by the Company for Cause the Company shall have no further liability under or in connection with this Agreement,
except to provide the amounts set forth in Section 6.A.

 

G.       Upon
voluntary or involuntary termination of employment of the Executive for any reason whatsoever or expiration of the Term, the Executive
shall continue to be subject to the provisions of Section 7, hereof (it being understood and agreed that such provisions shall
survive any termination or expiration of the Executive’s employment hereunder for any reason whatsoever).

 

    	6

     

    

 

7.       Confidentiality,
Return of Property, and Covenant Not to Compete.

 

A.       Confidential
Information.

 

(1)       Company
Information. The Company agrees that it will provide the Executive with Confidential Information, as defined below, that will
enable the Executive to optimize the performance of the Executive’s duties to the Company. In exchange, the Executive agrees
to use such Confidential Information solely for the Company’s benefit. The Company and the Executive agree and acknowledge
that its provision of such Confidential Information is not contingent on the Executive’s continued employment with the Company.
Notwithstanding the preceding sentence, upon the termination of the Executive’s employment for any reason, the Company shall
have no obligation to provide the Executive with its Confidential Information. “Confidential Information” means any
Company proprietary information, technical data, trade secrets or know-how, including, but not limited to, research, product plans,
products services, customer lists and customers (including, but not limited to, customers of the Company on whom the Executive
called or with whom the Executive became acquainted during the term of the Executive’s employment), markets, software, developments,
inventions, processes, formulas, technology, designs, drawings, engineering, hardware configuration information, marketing finances
or other business information disclosed to the Executive by the Company either directly or indirectly in writing, orally or by
drawings or observation of parts or equipment. Confidential Information does not include any of the foregoing items which has
become publicly known and made generally available through no wrongful act of the Executive or of others who were under confidentiality
obligations as to the item or items involved or improvements or new versions.

 

The
Executive agrees at all times during the Term and thereafter, to hold in strictest confidence, and not to use, except for the
exclusive benefit of the Company, or to disclose to any person or entity without written authorization of the Board of Directors
of the Company, any Confidential Information of the Company.

 

(2)       Former
Employer Information. The Executive agrees that he will not, during his employment with the Company, improperly use or disclose
any proprietary information or trade secrets of any former or other person or entity and that the Executive will not bring onto
the premises of the Company any unpublished document or proprietary information belonging to any such employer, person or entity
unless consented to in writing by such employer, person or entity.

 

(3)       Third
Party Information. The Executive recognizes that the Company has received and in the future will receive from third parties
their confidential or proprietary information subject to a duty on the Company’s part to maintain the confidentiality of
such information and to use it only for certain limited purposes. The Executive shall hold all such confidential or proprietary
information in the strictest confidence and not disclose it to any person or entity or use it except as necessary in carrying
out the Executive’s work for the Company consistent with the Company’s agreement with such third party.

 

    	7

     

    

 

B.       Returning
Company Documents. At the time of leaving the employ of the Company, the Executive will deliver to the Company (and will not
keep in the Executive’s possession) specifications, drawings blueprints, sketches, materials, equipment, other documents
or property, or reproductions of any aforementioned items developed by the Executive pursuant to the Executive’s employment
with the Company or otherwise belonging to the Company, its successors or assigns.

 

C.       Notification
of New Employer. In the event that the Executive leaves the employ of the Company, the Executive hereby grants consent to
notification by the Company to the Executive’s new employer about the Executive’s rights and obligations under this
Agreement.

 

D.       Solicitation
of Employees. The Executive agrees that for a period of twelve (12) months immediately following the termination of the Executive’s
relationship with the Company for any reason, the Executive shall not either directly or indirectly solicit, induce or recruit
any of the Company’s employees to leave their employment, or take away such employees, or attempt to solicit, induce, recruit,
encourage or take away employees of the Company, either for himself or for any other person or entity.

 

E.       Covenant
Not to Compete.

 

(1)       The
Executive agrees that during the course of his employment and for twelve (12) months following the termination of the Executive’s
relationship with the Company for any reason, the Executive will not compete, without the prior written consent of the Company,
as a partner, employee, consultant, officer, director, manager, agent, associate, investor, or otherwise, directly or indirectly,
own, purchase, organize or take preparatory steps for the organization of, build, design, finance, acquire, lease, operate, manage,
invest in, work or consult for or otherwise affiliate with any business, in competition with the Company’s business. The
foregoing covenant shall cover the Executive’s activities in every part of the Territory in which the Executive may conduct
business during the term of such covenant as set forth above. “Territory” shall mean (i) all counties in the State
of Georgia and (ii) all counties in the State of Oklahoma.

 

(2)       The
Executive acknowledges that he will derive significant value from the Company’s agreement in Section 7.A(1) to provide the
Executive with that Confidential Information to enable the Executive to optimize the performance of the Executive’s duties
to the Company. The Executive further acknowledges that his fulfillment of the obligations contained in this Agreement, including,
but not limited to, the Executive’s obligation neither to disclose nor to use the Company’s Confidential Information
other than for the Company’s exclusive benefit and the Executive’s obligation not to compete contained in subsection
(1) above, is necessary to protect the Company’s Confidential Information and, consequently, to preserve the value and goodwill
of the Company. The Executive further acknowledge the time, geographic and scope limitations of the Executive’s obligations
under subsection (1) above are reasonable, especially in light of the Company’s desire to protect its Confidential Information,
and that the Executive will not be precluded from gainful employment if the Executive is obligated not to compete with the Company
during the period and within the Territory as described above.

 

    	8

     

    

 

(3)       The
covenants contained in subsection (1) above shall be construed as a series of separate covenants, one for each city, county and
state of any geographic area in the Territory. Except for geographic coverage, each such separate covenant shall be deemed identical
in terms to the covenant contained in subsection (1) above. If, in any judicial proceeding, a court refuses to enforce any of
such separate covenants (or any part thereof), then such unenforceable covenant (or such part) shall be eliminated from this Agreement
to the extent necessary to permit the remaining separate covenants (or portions thereof) to be enforced. In the event the provisions
of subsection (1) above are deemed to exceed the time, geographic or scope limitations permitted by Texas law, then such provisions
shall be reformed to the maximum time, geographic or scope limitations, as the case may be, then permitted by such law.

 

F.       Representations.
The Executive agrees to execute any proper oath or verify any proper document required to carry out the terms of this Agreement.
The Executive represents that his performance of all the terms of this Agreement will not breach any agreement to keep in confidence
proprietary information acquired by the Executive in confidence or in trust prior to the Executive’s employment by the Company.
The Executive has not entered into, and the Executive agrees that he will not enter into, any oral or written agreement in conflict
herewith.

 

8.       Arbitration.
Any dispute or controversy arising under or in connection with this Agreement (other than any dispute or controversy arising from
a violation or alleged violation by the Executive of the provisions of Section 7) shall be settled exclusively by final and binding
arbitration in Denver, Colorado, in accordance with the Employment Arbitration Rules of the American Arbitration Association (“AAA”).
The arbitrator shall be selected by mutual agreement of the parties, if possible. If the parties fail to reach agreement upon
appointment of an arbitrator within thirty days following receipt by one party of the other party’s notice of desire to
arbitrate, the arbitrator shall be selected from a panel or panels of persons submitted by the AAA. The selection process shall
be that which is set forth in the AAA Employment Arbitration Rules then prevailing, except that, if the parties fail to select
an arbitrator from one or more panels, AAA shall not have the power to make an appointment but shall continue to submit additional
panels until an arbitrator has been selected. This agreement to arbitrate shall not preclude the parties from engaging in voluntary,
non-binding settlement efforts including mediation.

 

    	9

     

    

 

9.       Notices.
All notices and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been duly given
upon receipt) by delivery in person, by registered or certified mail (return receipt requested and with postage prepaid thereon)
or by facsimile transmission to the respective parties at the following addresses (or at such other address as either party shall
have previously furnished to the other in accordance with the terms of this Section ):

 

if
to the Company:

Global Healthcare REIT

Attn:
Board of Directors/Compensation Committee Chairman

6800
North 79th St.

Suite
200

Niwot,
CO 80503 

 

if
to the Executive: 

 

         Zvi Rhine

         _____________________________

         _____________________________

 

10.       Amendment;
Waiver. The terms and provisions of this Agreement may be modified or amended only by a written instrument executed by each
of the parties hereto, and compliance with the terms and provisions hereof may be waived only by a written instrument executed
by each party entitled to the benefits thereof. No failure or delay on the part of any party in exercising any right, power or
privilege granted hereunder shall constitute a waiver thereof, nor shall any single or partial exercise of any such right, power
or privilege preclude any other or further exercise thereof or the exercise of any other right, power or privilege granted hereunder.

 

11.       Entire
Agreement. This Agreement and all Exhibits attached hereto constitute the entire agreement between the parties with respect
to the subject matter hereof and supersede all prior written or oral agreements or understandings between the parties relating
thereto.

 

12.       Severability.
In the event that any term or provision of this Agreement is found to be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining terms and provisions hereof shall not be in any way affected or impaired thereby, and this
Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained therein.

 

13.       Binding
Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors
and assigns (it being understood and agreed that, except as expressly provided herein, nothing contained in this Agreement is
intended to confer upon any other person or entity any rights, benefits or remedies of any kind or character whatsoever). The
Executive may not assign this Agreement without the prior written consent of the Company. Except as otherwise provided in this
Agreement, the Company may assign this Agreement to any of its affiliates or to any successor (whether by operation of law or
otherwise) to all or substantially all of its business and assets without the consent of the Executive. For purposes of this Agreement,
“affiliate” means any entity in which the Company owns shares or other measure of ownership representing at least
40% of the voting power or equivalent measure of control of such entity.

 

14.       Governing
Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado (except that no
effect shall be given to any conflicts of law principles thereof that would require the application of the laws of another jurisdiction).

 

15.       Headings.
The headings of the sections contained in this Agreement are for convenience only and shall not be deemed to control or affect
the meaning or construction of any provision of this Agreement.

 

16.       Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.

 

[END
OF PAGE]

 

    	10

     

    

 

IN
WITNESS THEREOF, the Company has caused this Agreement to be executed by its duly authorized officer and the Executive has signed
this Agreement as of the Effective Date.

 

	 	GLOBAL
    HEALTHCARE REIT
	 	 
	 	 	/s/
    Lance Baller
	 	By:
    	Lance
    Baller, CEO
	 	 	 
	 	EXECUTIVE
	 	 	 
	 	 	/s/
    Zvi Rhine
	 	 	Zvi
    Rhine

 

    	11

     

    

 

Exhibit
A

 

Term
Sheet — Initial Option Award

 

I.       Options.
Company will grant Executive an option to purchase 600,000 shares of Company common stock, based on the fair market value
as of the grant date, which shall be April 1, 2018.

 

		A.	Vested
                                         and exercisable with respect to (i) 150,000 shares on the grant date, (ii) an additional
                                         150,000 shares on the first anniversary of the grant date, (iii) an additional 150,000
                                         shares on the date 18 months following the grant date and (iv) an additional 150,000
                                         shares on the second anniversary of the grant date. Vesting and exercisability will be
                                         accelerated on a Change in Control, a termination without Cause or a termination for
                                         Good Reason.
	 	 	 
		B.	Options
                                         will have a term of 5 years.
	 	 	 
		C.	Company
                                         will register the Company’s shares subject to the option on Form S-8 or such other
                                         form as may be available, and the Company shall provide a cashless exercise procedure.
	 	 	 
		D.	Executive
                                         will enter into a Two year lock-up agreement when the Board of Directors enter into an
                                         agreement.
	 	 	 

	II.	Change
                                         in Control.

 

		A.	In
                                         the event of a Change in Control, Company will pay Executive a gross-up payment to cover
                                         the excise tax, if any, imposed under Section 4999 of the Internal Revenue Code in connection
                                         with excess parachute payments as defined in Section 280G of the Internal Revenue Code.
	 	 	 
		B.	“Change
                                         in Control” means: (a) the consummation of a merger or consolidation of the Company
                                         with or into another entity or any other transaction, the stockholders of the Company
                                         immediately prior to such merger, consolidation or other transaction own or beneficially
                                         own immediately after such merger, consolidation or other transaction 50% or more of
                                         the voting power of the outstanding securities of each of (i) the continuing or surviving
                                         entity and (ii) any direct or indirect parent entity of such continuing or surviving
                                         entity; (b) the sale, transfer or other disposition of all or substantially all of the
                                         Company’s assets to a Person which is not owned or controlled by the Company or
                                         its stockholders immediately prior to such sale, transfer or other disposition; (c) individuals
                                         who, immediately following the effective date of this Agreement, constitute the Board
                                         (the “Incumbent Board”) cease for any reason to constitute at least a majority
                                         of the Board; provided, however, that any individual becoming a director thereafter whose
                                         election, or nomination for election by the Company’s shareholders, was approved
                                         by a vote of at least a majority of the directors then comprising the Incumbent Board
                                         shall be considered as though such individual were a member of the Incumbent Board; or
                                         (d) any transaction as a result of which any Person is the “Beneficial Owner”
                                         (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities
                                         of the Company representing at least 20% of the total voting power represented by the
                                         Company’s then outstanding voting securities. For purposes of this definition of
                                         Change in Control, the term “Persons” means, acting individually or as a
                                         group, an individual or a corporation, limited liability company, partnership, joint
                                         venture, trust, unincorporated organization, association, government agency or political
                                         subdivision thereof or other entity.

 

    	12

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