Document:

POWERFLEET,
INC.

 

2018
Incentive Plan

 

Article
1

 

Establishment
and Purpose

 

1.1
Establishment of the Plan. The Company has hereby established an incentive compensation plan as set forth in this document,
as may be amended, supplemented, restated or otherwise modified from time to time.

 

1.2
Purpose of the Plan. The purpose of the Plan is to promote the success and enhance the value of the Company by linking
the personal interests of Participants to those of the Company’s stockholders, and by providing Participants with an incentive
for outstanding performance.

 

1.3
Effective Date of the Plan. The Plan is effective as of June 14, 2018 (the “Effective Date”). The Plan
will be deemed to be approved by the stockholders if it receives the affirmative vote of the holders of a majority of the shares
of stock of the Company present or represented and entitled to vote at a meeting duly held in accordance with the applicable provisions
of the Company’s Bylaws. The I.D. Systems, Inc. 2015 Equity Compensation Plan and the 2009 Non-Employee Director Equity
Compensation Plan (the “Prior Plans”) shall be frozen on the date on which this Plan is approved by the Company’s
stockholders and no new awards shall be issued under the Prior Plans. With respect to outstanding awards under the Prior Plans,
the Prior Plans shall remain in place and any awards granted under the Prior Plans shall continue to be subject to the terms of
the Prior Plans and applicable Award Agreements (as defined below) (including any such terms that are intended to survive the
termination of the Prior Plans or the settlement of such Award (as defined below)) and shall remain in effect pursuant to their
terms.

 

1.4
Duration of the Plan. Unless sooner terminated as provided herein, the Plan shall terminate ten (10) years from the Effective
Date. After the Plan is terminated, no Awards may be granted but Awards previously granted shall remain outstanding in accordance
with their applicable terms and conditions and the Plan’s terms and conditions.

 

Article
2

 

Definitions

 

Whenever
used in the Plan, the following terms shall have the meanings set forth below and, when the meaning is intended, the initial letter
of the word is capitalized:

 

2.1
“Affiliate” means, with respect to any Person, any other Person that directly or indirectly through one or
more intermediaries controls, is controlled by or is under common control with, the Person in question, including any subsidiary.
As used herein, the term “control” means the possession, direct or indirect, of the power to direct or cause the direction
of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise. As used
herein, the term “subsidiary” means any corporation, partnership, venture or other entity in which the Company holds,
directly or indirectly, a fifty percent (50%) or greater ownership interest.

 

2.2
“Applicable Law” means any applicable law, including without limitation: (a) provisions of the Code, the Securities
Act, the Exchange Act and any rules or regulations thereunder; (b) corporate, securities, tax or other laws, statutes, rules,
requirements or regulations, whether federal, state, local or foreign; and (c) rules of any securities exchange or automated quotation
system on which the Shares are listed, quoted or traded.

 

2.3
“Award” means, individually or collectively, a grant or award under this Plan of Options, Stock Appreciation
Rights, Restricted Stock (including unrestricted Stock), Restricted Stock Units, Performance Stock Units, Performance Shares,
Deferred Stock Awards, Other Stock-Based Awards, Dividend Equivalent Awards and Performance Bonus Awards, in each case subject
to the terms of the Plan.

 

    	 	 	 

    	 

    

 

2.4
“Award Agreement” means an agreement, certificate, resolution or other type or form of writing or other evidence
approved by the Committee which sets forth the terms and conditions of an Award. An Award Agreement may be in any electronic medium,
may be limited to a notation on the books and records of the Company and, with the approval of the Committee, need not be signed
by a representative of the Company or a Participant. In the event of any inconsistency between the Plan and an Award Agreement,
the terms of the Plan shall govern.

 

2.5
“Beneficial Owner” or “Beneficial Ownership” has the meaning ascribed to such term in Rule
13d-3 under the Exchange Act.

 

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

 

2.7
“Cause” means (i) conviction of, or the entry of a plea of guilty or no contest to, a felony or any other crime
that causes the Company or its Affiliates public disgrace or disrepute, or materially and adversely affects the Company’s
or its Affiliates’ operations or financial performance or the relationship the Company has with its customers, (ii) gross
negligence or willful misconduct with respect to the Company or any of its Affiliates, including, without limitation fraud, embezzlement,
theft or proven dishonesty in the course of his or her employment; (iii) refusal to perform any lawful, material obligation or
fulfill any duty (other than any duty or obligation of the type described in clause (v) below) to the Company or its Affiliates
(other than due to a Disability), which refusal, if curable, is not cured within 10 days after delivery of written notice thereof;
(iv) material breach of any agreement with or duty owed to the Company or any of its Affiliates, which breach, if curable, is
not cured within 10 days after the delivery of written notice thereof; or (v) any breach of any obligation or duty to the Company
or any of its Affiliates (whether arising by statute, common law or agreement) relating to confidentiality, noncompetition, nonsolicitation
or proprietary rights. Notwithstanding the foregoing, if a Participant and the Company (or any of its Affiliates) have entered
into an employment agreement, consulting agreement or other similar agreement that specifically defines “cause,” then
with respect to such Participant, “Cause” shall have the meaning defined in that employment agreement, consulting
agreement or other agreement.

 

2.8
“Change in Control” shall be deemed to have occurred if:

 

(a)
any Person, other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company or a corporation
owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of stock
of the Company, becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing fifty percent
(50%) or more of the total voting power represented by the Company’s then outstanding voting securities;

 

(b)
during any period of two (2) consecutive years, individuals who at the beginning of such period constitute the Board of Directors
of the Company and any new Director whose election by the Board of Directors or nomination for election by the Company’s
stockholders was approved by a vote of a majority of the Directors then still in office who either were Directors at the beginning
of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority
thereof;

 

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

 

(d)
the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition
by the Company of all or substantially all the Company’s assets.

 

Notwithstanding
the foregoing, if a Change in Control constitutes a payment event with respect to any Award (or any portion of an Award) that
provides for the deferral of compensation that is subject to Section 409A of the Code, to the extent required to avoid the imposition
of additional taxes under Section 409A of the Code, the transaction or event described in subsection (a), (b), (c) or (d) with
respect to such Award (or portion thereof) shall only constitute a Change in Control for purposes of the payment timing of such
Award if such transaction also constitutes a “change in control event,” as defined in Treasury Regulation Section
1.409A-3(i)(5).

 

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The
Committee shall have full and final authority, which shall be exercised in its sole discretion, to determine conclusively whether
a Change in Control has occurred pursuant to the above definition, the date of the occurrence of such Change in Control and any
incidental matters relating thereto; provided that any exercise of authority in conjunction with a determination of whether a
Change in Control is a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5) shall be
consistent with such regulation.

 

2.9
“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the Treasury Regulations
issued thereunder.

 

2.10
“Committee” has the meaning set forth in Section 3.1.

 

2.11
“Company” means PowerFleet, Inc., a Delaware corporation.

 

2.12
“Consultant” means any consultant or advisor who renders bona fide services to the Company or an Affiliate,
other than as an Employee or Director, provided that such services are not in connection with the offer or sale of securities
in a capital-raising transaction and do not, directly or indirectly, promote or maintain a market for the Company’s or its
Affiliates’ securities.

 

2.13
“Deferred Stock” means a right to receive a specified number of shares of Stock during specified time periods
pursuant to Article 9.

 

2.14
“Director” means a member of the Board.

 

2.15
“Disability” means, unless otherwise determined by the Committee in the applicable Award Agreement, absence
of an Employee from work under the relevant Company or Subsidiary long term disability plan; provided, however, that to entitle
a Participant to an extended exercise period for an Incentive Stock Option, the Participant must be described in Section 22(e)(3)
of the Code. Notwithstanding the foregoing, for Awards subject to Section 409A of the Code, Disability shall mean that a Participant
is disabled under Section 409A(a)(2)(C)(i) or (ii) of the Code.

 

2.16
“Dividend Equivalent” means a right granted to a Participant pursuant to Article 9 to receive the equivalent
value (in cash or Stock) of dividends paid on Stock.

 

2.17
“Effective Date” has the meaning set forth in Section 1.3.

 

2.18
“Eligible Person” means any person who is an employee, officer, director, consultant, advisor or other individual
service provider of the Company or any Affiliate, or any person who is determined by the Committee to be a prospective employee,
officer, director, consultant, advisor or other individual service provider of the Company or any Affiliate.

 

2.19
“Employee” means any person employed by the Company, its Affiliates and/or Subsidiaries; provided, that,
for purposes of determining eligibility to receive Incentive Stock Options, an Employee shall mean an employee of the Company
or a parent or subsidiary corporation within the meaning of Section 424 of the Code. Mere service as a Director or payment of
a director’s fee by the Company or an Affiliate shall not be sufficient to constitute “employment” by the Company
or an Affiliate.

 

2.20
“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any successor Act
thereto.

 

2.21
“Exercise Price” means the price at which a Share may be purchased by a Participant pursuant to an Option,
as determined by the Committee.

 

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2.22
“Fair Market Value” or “FMV” means, as of any date, the value of Stock determined as follows:

 

(a)
If the Stock is listed on one or more established stock exchanges or national market systems, including, without limitation, the
NASDAQ Global Select Market, The NASDAQ Global Market or The NASDAQ Capital Market of The NASDAQ Stock Market LLC, its Fair Market
Value shall be the closing sales price for such Stock (or the closing bid, if no sales were reported) as quoted on the principal
exchange or system on which the Stock is listed (as determined by the Committee) on the date of determination (or, if no closing
sales price or closing bid was reported on that date, as applicable, on the last immediately preceding trading date such closing
sales price or closing bid was reported), as reported in The Wall Street Journal or such other source as the Committee
deems reliable;

 

(b)
If the Stock is regularly quoted on an automated quotation system (including the OTC Bulletin Board) or by a recognized securities
dealer, its Fair Market Value shall be the closing sales price for such Stock as quoted on such system or by such securities dealer
on the date of determination, but if selling prices are not reported, the Fair Market Value of a share of Stock shall be the mean
between the high bid and low asked prices for the Stock on the date of determination (or, if no such prices were reported on that
date, on the last date such prices were reported), as reported in The Wall Street Journal or such other source as the Committee
deems reliable; or

 

(c)
In the absence of an established market for the Stock of the type described in (a) and (b), above, the Fair Market Value thereof
shall be determined by the Committee in good faith using any reasonable method of valuation, which method may be set forth with
greater specificity in the Award Agreement, (and, to the extent necessary or advisable, in a manner consistent with Section 409A
of the Code and Section 422 of the Code for Incentive Stock Options), which determination shall be conclusive and binding on all
interested parties. Such reasonable method may be determined by reference to (i) the placing price of the latest private placement
of the Shares and the development of the Company’s business operations and the general economic and market conditions since
such latest private placement; (ii) other third party transactions involving the Shares and the development of the Company’s
business operation and the general economic and market conditions since such sale; (iii) an independent valuation of the Shares
(by a qualified valuation expert) or (iv) such other methodologies or information as the Committee determines to be indicative
of Fair Market Value.

 

2.23
“Good Reason” means, unless the applicable Award Agreement states otherwise, (i) if an Employee or Consultant
is a party to an employment or service agreement with the Company or its Affiliates and such agreement provides for a definition
of “good reason,” the definition contained therein, or (ii) if no such agreement exists or if such agreement does
not define “good reason,” in connection with a Termination of Employment by a Participant within one (1) year following
a Change in Control, (1) a material adverse alteration in the Participant’s position or in the nature or status of the Participant’s
responsibilities from those in effect immediately prior to the Change in Control, or (2) any material reduction in the Participant’s
base salary rate or target annual bonus, in each case as in effect immediately prior to the Change in Control, or (3) the relocation
of the Participant’s principal place of employment to a location that is more than fifty (50) miles from the location where
the Participant was principally employed at the time of the Change in Control or materially increases the time of the Participant’s
commute as compared to the Participant’s commute at the time of the Change in Control (except for required travel on the
Company’s business to an extent substantially consistent with the Participant’s customary business travel obligations
in the ordinary course of business prior to the Change in Control).

 

In
order to invoke a Termination of Employment for Good Reason, a Participant must provide written notice to the Company or the Employer
with respect to which the Participant is employed or providing services of the existence of one or more of the conditions constituting
Good Reason within ninety (90) days following the Participant’s knowledge of the initial existence of such condition or
conditions, specifying in reasonable detail the conditions constituting Good Reason, and the Company shall have thirty (30) days
following receipt of such written notice (the “Cure Period”) during which it may remedy the condition. In the
event that the Company or the Employer fails to remedy the condition constituting Good Reason during the applicable Cure Period,
the Participant’s “separation from service” (within the meaning of Section 409A of the Code) must occur, if
at all, within one (1) year following such Cure Period in order for such termination as a result of such condition to constitute
a Termination of Employment for Good Reason.

 

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2.24
“Incentive Stock Option” means an Option that is intended to qualify as an “incentive stock option”
within the meaning of Section 422 of the Code and that meets the requirements set out in the Plan.

 

2.25
“Insider” means an individual who is, on the relevant date, an officer, director, or ten percent (10%) beneficial
owner of the Company, as those terms are defined under Section 16 of the Exchange Act, who is required to file reports pursuant
to Rule 16a-3 under the Exchange Act.

 

2.26
“Non-Employee Director” means a member of the Board who is not an Employee of the Company.

 

2.27
“Non-Qualified Stock Option” means an Option that, by its terms, does not qualify or is not intended to qualify
as an Incentive Stock Option.

 

2.28
“Option” means the right to purchase Stock granted to a Participant in accordance with Article 6. Options
granted under the Plan may be Non-Qualified Stock Options, Incentive Stock Options or a combination thereof.

 

2.29
“Other Stock-Based Award” means an equity-based or equity-related Award not otherwise described by the terms
of the Plan, granted pursuant to Article 9.

 

2.30
“Participant” means an Eligible Person to whom an Award is granted under the Plan.

 

2.31
“Performance Goal” means any goals established by the Committee pursuant to an Award.

 

2.32
“Performance Period” means one or more periods of time, which may be of varying and overlapping durations,
as the Committee may select, over which the attainment of one or more Performance Goals will be measured for the purpose of determining
a Participant’s right to, and the payment of, Performance Stock Units and Performance Shares.

 

2.33
“Performance Stock Unit” and “Performance Share” each mean an Award granted to an Employee
pursuant to Article 9 herein.

 

2.34
“Permitted Transferee” shall mean, with respect to a Participant, any “family member” of the Participant,
as defined in the General Instructions to Form S-8 Registration Statement under the Securities Act (or any successor form thereto),
or to any other transferee specifically approved by the Committee after taking in to account Applicable Law, but excluding any
third-party financial institutions.

 

2.35
“Person” has the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and used in Sections
13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) thereof.

 

2.36
“Plan” means this PowerFleet, Inc. 2018 Incentive Plan, as it may be amended, supplemented, restated or otherwise
modified from time to time.

 

2.37
“Prior Plans” has the meaning set forth in Section 1.3.

 

2.38
“Restricted Stock” means Stock awarded to a Participant pursuant to Article 8 as to which the Restriction
Period has not lapsed.

 

2.39
“Restricted Stock Unit” means an Award granted pursuant to Section 8.9 as to which the Restriction Period
has not lapsed.

 

2.40
“Restriction Period” means the period when Restricted Stock or Restricted Stock Units are subject to a “substantial
risk of forfeiture” within the meaning of Section 83 of the Code (based on the passage of time, the achievement of performance
goals, or upon the occurrence of other events as determined by the Committee, in its discretion), as provided in Article 8.

 

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2.41
“Securities Act” means the Securities Act of 1933, as amended.

 

2.42
“Share” means a share of Stock of the Company.

 

2.43
“Stock” means the common stock of the Company, par value $0.01 per share.

 

2.44
“Stock Appreciation Right” or “SAR” means a right granted pursuant to Article 9 to
receive an amount payable in cash or Shares equal to the excess of (i) the Fair Market Value of a specified number of Shares on
the date the SAR is exercised over (ii) the Fair Market Value of such Shares on the date the SAR was granted as set forth in the
applicable Award Agreement.

 

2.45
“Subsidiary” means any corporation, partnership, venture, unincorporated association or other entity in which
the Company holds, directly or indirectly, a fifty percent (50%) or greater ownership interest, provided, however, that with respect
to an Incentive Stock Option, a Subsidiary must be a corporation. The Committee may, at its sole discretion, designate, on such
terms and conditions as the Committee shall determine, any other corporation, partnership, limited liability company, venture,
or other entity a Subsidiary for purposes of this Plan.

 

2.46
“Ten Percent Owner” means a person who owns, or is deemed within the meaning of Section 422(b)(6) of the Code
to own, stock possessing more than 10% of the total combined voting power of all classes of stock of the Company (or any parent
or subsidiary corporations of the Company, as defined in Sections 424(e) and (f), respectively, of the Code). Whether a person
is a Ten Percent Owner shall be determined with respect to an Option based on the facts existing immediately prior to the grant
date of the Option.

 

2.47
“Termination of Employment” or a similar reference means the event where the Employee is no longer an Employee
of the Company or of any Subsidiary, including but not limited to where the employing company ceases to be a Subsidiary. With
respect to any Participant who is not an Employee, “Termination of Employment” shall mean cessation of the performance
of services. With respect to any Award that provides “non-qualified deferred compensation” within the meaning of Section
409A of the Code, “Termination of Employment” shall mean a “separation from service” as defined under
Section 409A of the Code. Military or sick leave or other bona fide leave shall not be deemed a termination of employment, provided
that it does not exceed the longer of three (3) months or the period during which the absent Participant’s reemployment
rights, if any, are guaranteed by statute or by contract.

 

2.48
“Treasury Regulation” or “Treas. Reg.” means any regulation promulgated under the Code,
as such regulation may be amended from to time.

 

Article
3

 

Administration

 

3.1
Committee. Except as otherwise provided herein, the Plan shall be administered by the Compensation Committee of the Board
(the “Committee”). Unless otherwise determined by the Board, the Committee shall consist solely of two or more
members of the Board each of whom is (a) a “non-employee director” within the meaning of Rule 16b-3 of the Exchange
Act, and (b) an “independent director” under the rules of the Nasdaq Stock Market (or any similar rule or listing
requirement that may be applicable to the Company from time to time); provided, that any action taken by the Committee shall be
valid and effective, whether or not members of the Committee at the time of such action are later determined not to have satisfied
the requirements for membership set forth in this Section 3.1 or otherwise provided in any charter of the Committee. Notwithstanding
the foregoing: (a) the full Board, acting by a majority of its members in office, shall conduct the general administration of
the Plan with respect to all Awards granted to Non-Employee Directors and for purposes of such Awards the term “Committee”
as used in this Plan shall be deemed to refer to the Board and (b) the Committee may delegate its authority hereunder to the extent
permitted by Section 3.4. In its sole discretion, the Board may at any time and from time to time exercise any and all
rights and duties of the Committee under the Plan except with respect to matters which under Rule 16b-3 under the Exchange Act,
or any regulations or rules issued thereunder, are required to be determined in the sole discretion of the Committee. Except as
may otherwise be provided in any charter of the Committee, appointment of Committee members shall be effective upon acceptance
of appointment; Committee members may resign at any time by delivering written notice to the Board; and vacancies in the Committee
may only be filled by the Board.

 

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3.2
Authority of the Committee. Subject to the general purposes, terms and conditions of this Plan and Applicable Law, and
to the direction of the Board, the Committee shall have complete control over the administration of the Plan and shall have sole
authority to (a) exercise all of the powers granted to it under the Plan, (b) construe, interpret and implement the Plan, grant
terms and grant notices, and all Award Agreements, (c) prescribe, amend and rescind rules and regulations relating to the Plan,
including rules governing its own operations, (d) make all determinations necessary or advisable in administering the Plan, (e)
correct any defect, supply any omission and reconcile any inconsistency in the Plan, (f) amend the Plan to reflect changes in
applicable law (whether or not the rights of the holder of any Award are adversely affected, unless otherwise provided by the
Committee), (g) grant Awards and determine who shall receive Awards, when such Awards shall be granted and the terms and conditions
of such Awards, including, but not limited to, conditioning the exercise, vesting, payout or other term of condition of an Award
on the achievement of Performance Goals, (h) unless otherwise provided by the Committee, amend any outstanding Award in any respect,
not materially adverse to the Participant, including, without limitation, to (1) accelerate the time or times at which the Award
becomes vested, unrestricted or may be exercised (and, in connection with such acceleration, the Committee may provide that any
Shares acquired pursuant to such Award shall be restricted Shares, which are subject to vesting, transfer, forfeiture or repayment
provisions similar to those in the Participant’s underlying Award), (2) accelerate the time or times at which Shares are
delivered under the Award (and, without limitation on the Committee’s rights, in connection with such acceleration, the
Committee may provide that any shares of Stock delivered pursuant to such Award shall be Restricted Shares, which are subject
to vesting, transfer, forfeiture or repayment provisions similar to those in the Participant’s underlying Award), or (3)
waive or amend any goals, restrictions or conditions applicable to such Award, or impose new goals, restrictions and (i) determine
at any time whether, to what extent and under what circumstances and method or methods (1) Awards may be (A) settled in cash,
Shares, other securities, other Awards or other property (in which event, the Committee may specify what other effects such settlement
will have on the Participant’s Award), (B) exercised or (C) canceled, forfeited or suspended, (2) Shares, other securities,
cash, other Awards or other property and other amounts payable with respect to an Award may be deferred either automatically or
at the election of the Participant or of the Committee, or (3) Awards may be settled by the Company or any of its Subsidiaries
or any of its or their designees. No Award may be made under the Plan after the tenth (10th) anniversary of the Effective
Date.

 

3.3
Committee Decisions Final. The act or determination of a majority of the Committee shall be the act or determination of
the Committee and any decision reduced to writing and signed by all of the members of the Committee shall be fully effective as
if it had been made by a majority at a meeting duly held. The Committee may employ attorneys, consultants, accountants, agents,
and other persons, any of whom may be an Employee, and the Committee, the Company, and its officers and Directors shall be entitled
to rely upon the advice, opinions, or valuations of any such persons. All actions taken and all interpretations and determinations
made by the Committee pursuant to the provisions of the Plan and all related orders or resolutions shall be final and binding
upon the Participants, the Company, and all other interested persons, including but not limited to the Company, its stockholders,
Employees, Participants, and their estates and beneficiaries.

 

3.4
Delegation of Authority. The Board or Committee may from time to time delegate to a committee of one or more members of
the Board or one or more officers of the Company the authority to grant or amend Awards or to take other administrative actions
pursuant to this Article 3; provided, however, that in no event shall an officer of the Company be delegated the authority
to grant Awards to, or amend Awards held by, the following individuals: (a) individuals who are subject to Section 16 of the Exchange
Act, or (b) officers of the Company (or Directors) to whom authority to grant or amend Awards has been delegated hereunder; provided,
further, that any delegation of administrative authority shall only be permitted to the extent it is permissible under the Company’s
Certificate of Incorporation, Bylaws and Applicable Law. Any delegation hereunder shall be subject to the restrictions and limits
that the Board or Committee specifies at the time of such delegation or that are otherwise included in the applicable Organizational
Documents, and the Board or Committee, as applicable, may at any time rescind the authority so delegated or appoint a new delegatee.
At all times, the delegatee appointed under this Section 3.4 shall serve in such capacity at the pleasure of the Board
or the Committee, as applicable, and the Board or the Committee may abolish any committee at any time and re-vest in itself any
previously delegated authority.

 

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3.5
Indemnification. To the extent allowable pursuant to applicable law, each member of the Committee or of the Board shall
be indemnified and held harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or reasonably
incurred by such member in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be
a party or in which he or she may be involved by reason of any action or failure to act pursuant to the Plan and against and from
any and all amounts paid by him or her in satisfaction of judgment in such action, suit, or proceeding against him or her; provided
he or she gives the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle
and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification
to which such persons may be entitled pursuant to the Company’s Certificate of Incorporation or Bylaws, as a matter of law,
or otherwise, or any power that the Company may have to indemnify them or hold them harmless.

 

Article
4

 

Shares
Subject to the Plan

 

4.1
Number of Shares. Subject to adjustment as provided in Sections 4.2 and 4.3, the aggregate number of Shares
of Stock which may be issued or transferred pursuant to Awards under the Plan shall be the sum of: (i) 4,500,000 shares, plus
(ii) the number of shares of common stock of the Company which remain available for grants of options or other awards under the
Prior Plans as of the Effective Date, plus (iii) the number of Shares that, after the Effective Date, would again become available
for issuance pursuant to the reserved share replenishment provisions of the Prior Plans as a result of, stock options issued thereunder
expiring or becoming unexercisable for any reason before being exercised in full, or, as a result of restricted stock being forfeited
to the Company or repurchased by the Company pursuant to the terms of the agreements governing such shares. The share replenishment
provision of the immediately preceding clause (iii) shall be effective regardless of whether the Prior Plans have terminated or
remain in effect. Notwithstanding the foregoing, in order that the applicable regulations under the Code relating to Incentive
Stock Options be satisfied, the maximum number of shares of Stock that may be delivered upon exercise of Incentive Stock Options
shall be 4,000,000, as adjusted under Sections 4.2 and 4.3. Shares of Stock issued pursuant to the Plan may be either
authorized but unissued Shares or Shares held by the Company in its treasury.

 

4.2
Share Accounting. Without limiting the discretion of the Committee under this section, the following rules will apply for
purposes of the determination of the number of Shares available for grant under the Plan or compliance with the foregoing limits:

 

(a)
If an outstanding Award for any reason 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 are forfeited under the terms of the Plan or the relevant Award,
the Shares allocable to the terminated portion of such Award or such forfeited Shares shall again be available for issuance under
the Plan.

 

(b)
Shares shall not be deemed to have been issued pursuant to the Plan with respect to any portion of an Award that is settled in
cash, other than an Option.

 

(c)
If the exercise price of an Option is paid by tender to the Company, or attestation to the ownership, of Shares owned by the Participant,
or an Option is settled without the payment of the exercise price, or the payment of taxes with respect to any Award is settled
by a net exercise, the number of shares available for issuance under the Plan shall be reduced by the gross number of shares for
which the Option is exercised or other Awards that have vested.

 

4.3
Adjustments in Authorized Plan Shares and Outstanding Awards. In the event of any merger, reorganization, consolidation,
recapitalization, separation, split-up, liquidation, Share combination, Stock split, Stock dividend, an extraordinary cash distribution
on Stock, a corporate separation or other reorganization or liquidation or other change in the corporate or capital structure
of the Company affecting the Shares, an adjustment shall be made in a manner consistent with Sections 422 and 424(h)(3) of the
Code for Incentive Stock Options and in a manner consistent with Section 409A of the Code for Non-Qualified Stock Options and
in the number and class of and/or price of Shares subject to outstanding Awards granted under the Plan, and/or the number of outstanding
Options, Shares of Restricted Stock, and Performance Shares (and Restricted Stock Units, Performance Stock Units and other Awards
whose value is based on a number of Shares) constituting outstanding Awards, as may be determined to be appropriate and equitable
by the Committee, in its sole discretion, to prevent dilution or enlargement of rights. The Committee may make adjustments in
the terms and conditions of, and the criteria included in Awards in recognition of unusual or nonrecurring events (including,
without limitation, the events described in this Section) affecting the Company or the financial statements of the Company or
of changes in applicable laws, regulations, or accounting principles, whenever the Committee determines that such adjustments
are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available
under the Plan. Adjustments under this Section 4.3 shall be consistent with Section 409A of the Code and adjustments pursuant
to determination of the Committee shall be conclusive and binding on all Participants under the Plan.

 

    	 	8	 

    	 

    

 

4.4
Limitation on Number of Shares Granted to Non-Employee Directors. Notwithstanding any provision in the Plan to the contrary,
the sum of the grant date Fair Market Value of equity-based Awards and the amount of any cash-based Awards granted to a Non-Employee
Director during any calendar year shall not exceed five hundred thousand dollars ($500,000).

 

Article
5

 

Eligibility
and Participation

 

5.1
Eligibility and Participation. Subject to the provisions of the Plan, the Committee may, from time to time, select from
all Eligible Persons, those to whom Awards shall be granted and shall determine, in its sole discretion, the nature of, any and
all terms permissible by law, and the amount of each Award. In making this determination, the Committee may consider any factors
it deems relevant, including without limitation, the office or position held by a Participant or the Participant’s relationship
to the Company, the Participant’s degree of responsibility for and contribution to the growth and success of the Company
or any Subsidiary or Affiliate, the Participant’s length of service, promotions and potential. No individual shall have
the right to be selected to receive an Award under this Plan, or, having been so selected, to be selected to receive a future
Award. In addition, there is no obligation for uniformity of treatment of Participants or holders or beneficiaries of Awards.
The terms and conditions of Awards and the Committee’s determinations and interpretations with respect thereto need not
be the same with respect to each Participant and may be made selectively among Participants, whether or not such Participants
are similarly situated.

 

5.2
Foreign Participants. In order to assure the viability of Awards granted to Participants employed in foreign countries,
the Committee may provide for such special terms as it may consider necessary or appropriate to accommodate differences in local
law, tax policy, or custom. Moreover, the Committee may approve such supplements to, or amendments, restatements, or alternative
versions of, the Plan as it may consider necessary or appropriate for such purposes without thereby affecting the terms of the
Plan as in effect for any other purpose; provided, however, that no such supplements, amendments, restatements, or alternative
versions shall increase the share limitations contained in Section 4.1 of the Plan.

 

Article
6

 

Options

 

6.1
Grant of Options. Subject to the terms and provisions of the Plan, Options may be granted to Participants in such number,
and upon such terms and conditions, and at any time and from time to time as shall be determined by the Committee, in its sole
discretion, subject to the limitations set forth in Article 4 and the following terms and conditions:

 

(a)
Award Agreement. Each Option grant shall be evidenced by an Award Agreement that shall specify the terms and conditions
of the Option, including the Exercise Price, the maximum duration of the Option, the number of Shares to which the Option pertains,
the conditions upon which an Option shall become vested and exercisable, and such other provisions as the Committee shall determine
which are not inconsistent with the terms of the Plan. The Award Agreement also shall specify whether the Option is intended to
be an Incentive Stock Option or a Non-Qualified Stock Option.

 

    	 	9	 

    	 

    

 

(b)
Exercise Period. Unless a shorter period is otherwise provided by the Committee at the time of grant, each Option will
expire on the tenth (10th) anniversary date of its grant or on the fifth (5th) anniversary of its grant
date if the Participant is a Ten Percent Owner.

 

(c)
Exercise Price. Unless a greater Exercise Price is determined by the Committee, the Exercise Price for each Option awarded
under this Plan shall be equal to one hundred percent (100%) of the Fair Market Value of a Share on the date the Option is granted.

 

(d)
Vesting of Options. Subject to Section 13.1, a grant of Options shall vest at such times and under such terms and
conditions as determined by the Committee including, without limitation, suspension of a Participant’s vesting during all
or a portion of a Participant’s leave of absence.

 

6.2
Limitations on Incentive Stock Options. In addition to the general requirements of Article 6, the terms of any ISO
granted pursuant to the Plan must comply with the provisions of this Section 6.2.

 

(a)
ISO Eligibility. ISOs may be granted only to Employees of the Company or of any parent or subsidiary corporation (as permitted
under Sections 422 and 424 of the Code). No ISO Award may be made pursuant to this Plan after the tenth (10th) anniversary of
the Effective Date.

 

(b)
ISO Individual Dollar Limitation. The aggregate Fair Market Value (determined as of the date the Option is granted) of
all Shares with respect to which Incentive Stock Options are first exercisable by a Participant in any calendar year may not exceed
one hundred thousand dollars ($100,000.00) or such other limitation as imposed by Section 422(d) of the Code. To the extent that
Incentive Stock Options are first exercisable by a Participant in excess of such limitation, the excess shall be considered Non-Qualified
Stock Options.

 

(c)
ISO Expiration. An ISO will expire and may not be exercised to any extent by anyone after the first to occur of the following
events:

 

(i)
Ten (10) years from the date of grant, unless an earlier time is set in the Award Agreement;

 

(ii)
Three (3) months after the date of the Participant’s Termination of Employment other than on account of Disability or death.
Whether a Participant continues to be an employee shall be determined in accordance with Treas. Reg. Section 1.421-1(h)(2); and

 

(iii)
One (1) year after the date of the Participant’s Termination of Employment on account of Disability or death. Upon the Participant’s
Disability or death, any ISOs exercisable at the Participant’s Disability or death may be exercised by the Participant’s
legal representative or representatives, by the person or persons entitled to do so pursuant to the Participant’s last will
and testament, or, if the Participant fails to make testamentary disposition of such ISO or dies intestate, by the person or persons
entitled to receive the ISO pursuant to the applicable laws of descent and distribution.

 

Any
ISO that remains exercisable pursuant to a Participant’s agreement with the Company following Termination of Employment
and is unexercised more than one (1) year following Termination of Employment by reason of death or Disability or more than three
(3) months following Termination of Employment for any reason other than death or Disability will thereafter be deemed to be a
Non-Qualified Stock Option.

 

(d)
Ten Percent Owners. In the case of an ISO granted to a Ten Percent Owner, such ISO shall be granted at an exercise price
that is not less than one hundred and ten percent (110%) of Fair Market Value on the date of grant and, unless a shorter period
is otherwise provided by the Committee at the time of grant, each ISO will expire on the fifth (5th) anniversary of
its grant date.

 

(e)
Notification of Disposition. If a Participant disposes of Shares acquired upon exercise of an ISO within two (2) years
from the date the Option is granted or within one (1) year after the issuance of such Shares to the Participant, the Participant
shall notify the Company of such disposition and provide information regarding the date of disposition, sale price, number of
Shares disposed of, and any other information relating thereto that the Company may reasonably request.

 

    	 	10	 

    	 

    

 

(f)
Right to Exercise. During a Participant’s lifetime, an Incentive Stock Option may be exercised only by the Participant.

 

(g)
Failure to Meet ISO Requirements. If an Option is intended to be an Incentive Stock Option, and if, for any reason, such
Option (or any portion thereof) shall not qualify as an Incentive Stock Option, then, to the extent of such nonqualification,
such Option (or portion thereof) shall be regarded as a Non-Qualified Stock Option appropriately granted under the Plan; provided
that such Option (or portion thereof) otherwise complies with the Plan’s requirements relating to Non-Qualified Stock
Options.

 

6.3
Exercise of Options.

 

(a)
Options granted under the Plan shall be exercisable at such times and be subject to such restrictions and conditions as the Committee
shall in each instance approve, which need not be the same for each grant or for each Participant. Exercises of Options may be
effected only on days and during the hours NASDAQ is open for regular trading. The Company may change or limit the times or days
Options may be exercised. If an Option expires on a day or at a time when exercises are not permitted, then the Options may be
exercised no later than the immediately preceding date and time that the Options were exercisable.

 

(b)
An Option shall be exercised by providing notice to the designated agent selected by the Company (if no such agent has been designated,
then to the Company), in the manner and form determined by the Company, which notice shall be irrevocable, setting forth the exact
number of Shares with respect to which the Option is being exercised and including with such notice payment of the Exercise Price,
as applicable. When an Option has been transferred, the Company or its designated agent may require appropriate documentation
that the person or persons exercising the Option, if other than the Participant, has the right to exercise the Option. No Option
may be exercised with respect to a fraction of a Share.

 

6.4
Termination of Employment. Unless otherwise provided by the Committee in the applicable Award Agreement, the following
limitations on the exercise of Options shall apply upon Termination of Employment:

 

(a)
Termination by Death or Disability. In the event of the Participant’s Termination of Employment by reason of death
or Disability, all outstanding Options granted to such Participant which are vested and exercisable as of the effective date of
Termination of Employment by reason of death or Disability may be exercised, if at all, no more than one (1) year from such date
of Termination of Employment, unless the Options, by their terms, expire earlier. All unvested Options granted to such Participant
shall immediately become forfeited as of the date of Termination of Employment.

 

(b)
Involuntary Termination Without Cause. If a Participant’s Termination of Employment is by involuntary termination
without Cause, all Options held by such Participant that are vested and exercisable at the time of the Participant’s Termination
of Employment may be exercised by the Participant at any time within a period of three (3) months from the date of such Termination
of Employment, but in no event beyond the expiration of the stated term of such Options. All Options held by the Participant which
are not vested on or before the effective date of Termination of Employment shall immediately be forfeited to the Company (and
the Shares subject to such forfeited Options shall once again become available for issuance under the Plan).

 

(c)
Voluntary Termination. If a Participant’s Termination of Employment is voluntary (other than a voluntary termination
described in Section 6.4(d)), all Options held by such Participant that are vested and exercisable at the time of the Participant’s
Termination of Employment may be exercised by the Participant at any time within a period of three (3) months from the date of
such Termination of Employment, but in no event beyond the expiration of the stated terms of such Options. All Options held by
the Participant which are not vested on or before the effective date of Termination of Employment shall immediately be forfeited
to the Company (and the Shares subject to such forfeited Options shall once again become available for issuance under the Plan).

 

    	 	11	 

    	 

    

 

(d)
Termination for Cause. If the Participant’s Termination of Employment (i) is by the Company for Cause or (ii) is
a voluntary Termination (as provided in Subsection (c) above) after the occurrence of an event that would be grounds for
Termination of Employment for Cause, all outstanding Options held by the Participant shall immediately be forfeited to the Company
and no additional exercise period shall be allowed, regardless of the vested status of the Options (and the Shares subject to
such forfeited Options shall once again become available for issuance under the Plan).

 

(e)
Other Terms and Conditions. Notwithstanding the foregoing, the Committee may, in its sole discretion, establish different,
or waive, terms and conditions pertaining to the effect of Termination of Employment on Options, whether or not the Options are
outstanding, but no such modification shall shorten the terms of Options issued prior to such modification or otherwise be materially
adverse to the Participant.

 

6.5
Payment. The Committee shall determine the methods by which payments by any Participant with respect to any Awards granted
under the Plan may be paid and the form of payment. Unless otherwise determined by the Committee, the Exercise Price shall be
paid in full at the time of exercise. No Shares shall be issued or transferred until full payment has been received or the next
business day thereafter, as determined by the Company. The Committee may, from time to time, determine or modify the method or
methods of exercising Options or the manner in which the Exercise Price is to be paid. Unless otherwise provided by the Committee
in full or in part, to the extent permitted by Applicable Law, payment may be made by any of the following:

 

(a)
cash or certified or bank check;

 

(b)
delivery of Shares owned by the Participant duly endorsed for transfer to the Company, with a Fair Market Value of such Shares
delivered on the date of delivery equal to the Exercise Price (or portion thereof) due for the number of Shares being acquired;

 

(c)
if the Company has designated a stockbroker to act as the Company’s agent to process Option exercises, an Option may be
exercised by issuing an exercise notice together with instructions to such stockbroker irrevocably instructing the stockbroker:
(i) to immediately sell (which shall include an exercise notice that becomes effective upon execution of a sale order) a sufficient
portion of the Shares to be received from the Option exercise to pay the Exercise Price of the Options being exercised and the
required tax withholding, and (ii) to deliver on the settlement date the portion of the proceeds of the sale equal to the Exercise
Price and tax withholding to the Company. In the event the stockbroker sells any Shares on behalf of a Participant, the stockbroker
shall be acting solely as the agent of the Participant, and the Company disclaims any responsibility for the actions of the stockbroker
in making any such sales. However, if the Participant is an Insider, then the instruction to the stock broker to sell in the preceding
sentence is intended to comply with the requirements of Rule 10b5-1(c)(1)(i)(B) of the Exchange Act to the extent permitted by
law. No Shares shall be issued until the settlement date and until the proceeds (equal to the Exercise Price and tax withholding)
are paid to the Company;

 

(d)
at any time, the Committee may, in addition to or in lieu of the foregoing, provide that an Option may be “stock settled,”
which shall mean upon exercise of an Option, the Company may fully satisfy its obligation under the Option by delivering that
number of shares of Stock found by taking the difference between (i) the Fair Market Value of the Stock on the exercise date,
multiplied by the number of Options being exercised and (ii) the total Exercise Price of the Options being exercised, and dividing
such difference by the Fair Market Value of the Stock on the exercise date; or

 

(e)
any combination of the foregoing methods.

 

Notwithstanding
any other provision of the Plan to the contrary, no Participant who is a Director or an “executive officer” of the
Company shall be permitted to pay the Exercise Price of an Option in any method which would violate Section 13(h) of the Exchange
Act.

 

    	 	12	 

    	 

    

 

Article
7

 

Stock
Appreciation Rights

 

7.1
Grant of SARs. Any Participant selected by the Committee may be granted one or more SARs. SARs may be granted alone or
in tandem with Options. Each SAR shall be evidenced by an Award Agreement that shall specify the exercise price, the term of the
SAR, and such other provisions as the Committee shall determine. With respect to SARs granted in tandem with Options, the exercise
of either such Options or such SARs shall result in the simultaneous cancellation of the same number of tandem SARs or Options,
as the case may be.

 

7.2
Exercise Price. The exercise price per Share covered by a SAR granted pursuant to the Plan shall be equal to or greater
than Fair Market Value on the date the SAR was granted.

 

7.3
Term. The term of each SAR shall be determined by the Committee in its sole discretion, but in no event shall the term
exceed ten (10) years from the date of grant.

 

7.4
Payment. SARs may be settled in the form of cash, shares of Stock or a combination of cash and shares of Stock, as determined
by the Committee.

 

7.5
Other Provisions. Except as the Committee may deem inappropriate or inapplicable in the circumstances, SARs shall be subject
to terms and conditions substantially similar to those applicable to Non-Qualified Options as set forth in Article 6.

 

Article
8

 

Restricted
Stock Awards

 

8.1
Grant of Restricted Stock. Subject to the terms and provisions of the Plan, the Committee, at any time and from time to
time, may grant shares of Restricted Stock to eligible Employees in such amounts and upon such terms and conditions as the Committee
shall determine. In addition to any other terms and conditions imposed by the Committee, vesting of Restricted Stock may be conditioned
upon the achievement of Performance Goals.

 

8.2
Restricted Stock Agreement. The Committee may require, as a condition to receiving a Restricted Stock Award, that the Participant
enter into a Restricted Stock Award Agreement, setting forth the terms and conditions of the Award. In lieu of a Restricted Stock
Award Agreement, the Committee may provide the terms and conditions of an Award in a notice to the Participant of the Award, on
the Stock certificate representing the Restricted Stock, in the resolution approving the Award, or in such other manner as it
deems appropriate. If certificates representing the Restricted Stock are registered in the name of the Participant, any certificates
so issued shall be printed with an appropriate legend referring to the terms, conditions, and restrictions applicable to such
Award as determined or authorized in the sole discretion of the Committee. Shares recorded in book-entry form shall be recorded
with a notation referring to the terms, conditions, and restrictions applicable to such Award as determined or authorized in the
sole discretion of the Committee. The Committee may require that the stock certificates or book-entry registrations evidencing
shares of Restricted Stock be held in custody by a designated escrow agent (which may but need not be the Company) until the restrictions
thereon shall have lapsed, and that the Participant deliver a stock power, endorsed in blank, relating to the Stock covered by
such Award.

 

8.3
Restrictions. Subject to Section 13.1, the Restricted Stock shall be subject to such vesting terms, including the
achievement of Performance Goals, as may be determined by the Committee. Unless otherwise provided by the Committee, to the extent
Restricted Stock is subject to any condition to vesting, if such condition or conditions are not satisfied by the time the period
for achieving such condition has expired, such Restricted Stock shall be forfeited. The Committee may impose such other conditions
and/or restrictions on any shares of Restricted Stock granted pursuant to the Plan as it may deem advisable including but not
limited to a requirement that Participants pay a stipulated purchase price for each share of Restricted Stock and/or restrictions
under Applicable Law. The Committee may also grant Restricted Stock without any terms or conditions in the form of vested Stock
Awards.

 

    	 	13	 

    	 

    

 

8.4
Removal of Restrictions. Except as otherwise provided in this Article 8 or otherwise provided in the grant thereof,
Shares of Restricted Stock covered by each Restricted Stock grant made under the Plan shall become freely transferable by the
Participant after completion of all conditions to vesting, if any. However, the Committee, in its sole discretion, shall have
the right to immediately vest the shares and waive all or part of the restrictions and conditions with regard to all or part of
the shares held by any Participant at any time.

 

8.5
Voting Rights, Dividends and Other Distributions. Participants holding shares of Restricted Stock granted hereunder may
exercise full voting rights and, subject to the provisions of this Section 8.5, may receive all dividends and distributions
paid with respect to such Shares. If any such dividends or distributions are paid in Shares, the Shares shall automatically be
subject to the same restrictions and conditions as the Restricted Stock with respect to which they were paid. In addition, with
respect to a share of Restricted Stock, dividends shall only be paid out to the extent that the Share of Restricted Stock vests.
Any cash dividends and stock dividends with respect to the Restricted Stock shall be withheld by the Company for the Participant’s
account, and interest may be credited on the amount of the cash dividends withheld at a rate and subject to such terms as determined
by the Committee. The cash dividends or stock dividends so withheld by the Committee and attributable to any particular share
of Restricted Stock (and earnings thereon, if applicable) shall be distributed to the Participant in cash or, at the discretion
of the Committee, in shares of Stock having a Fair Market Value equal to the amount of such dividends, if applicable, upon the
release of restrictions on such share and, if such share is forfeited, the Participant shall have no right to such dividends.

 

8.6
Termination of Employment Due to Death or Disability. In the event of the Participant’s Termination of Employment
by reason of death or Disability, unless otherwise determined by the Committee, all restrictions imposed on outstanding Shares
of Restricted Stock held by the Participant shall immediately lapse and the Restricted Stock shall immediately become fully vested
as of the date of Termination of Employment.

 

8.7
Termination of Employment for Other Reasons. Unless otherwise provided by the Committee, in the event of the Participant’s
Termination of Employment for any reason other than those specifically set forth in Section 8.6 herein, subject to Section
10.2, all shares of Restricted Stock held by the Participant which are not vested as of the effective date of Termination
of Employment shall immediately be forfeited and returned to the Company.

 

8.8
Section 83(b) Election. The Committee may provide in an Award Agreement that the Award of Restricted Stock is conditioned
upon the Participant making or refraining from making an election with respect to the Award under Section 83(b) of the Code. If
a Participant makes an election pursuant to Section 83(b) of the Code concerning a Restricted Stock Award, the Participant shall
be required to file a copy of such election with the Company within thirty (30) days following the date of grant.

 

8.9
Restricted Stock Units. In lieu of or in addition to Restricted Stock, the Committee may grant Restricted Stock Units under
such terms and conditions as shall be determined by the Committee in accordance with Section 3.2. Restricted Stock Units
shall be subject to the same terms and conditions under this Plan as Restricted Stock except as otherwise provided in this Plan
or as otherwise provided by the Committee. Except as otherwise provided by the Committee, the award shall be settled and paid
out promptly upon vesting (to the extent permitted by Section 409A of the Code), and the Participant holding such Restricted Stock
Units shall receive, as determined by the Committee, Shares (or cash equal to the Fair Market Value of the number of Shares as
of the date the Award becomes payable) equal to the number of such Restricted Stock Units. Restricted Stock Units shall not be
transferable, shall have no voting rights, and, unless otherwise determined by the Committee, shall not receive dividends or Dividend
Equivalents (which in any event shall only be paid out to the extent that the Restricted Stock Units vest). Upon a Participant’s
Termination of Employment due to death or Disability, the Committee will determine whether there should be any acceleration of
vesting.

 

Article
9

 

Other
Types of Awards

 

9.1
Performance Share Awards. Any Participant selected by the Committee may be granted one or more Performance Share awards
which shall be denominated in a number of shares of Stock and which may be linked to any one or more of the Performance Goals
or other specific performance criteria determined appropriate by the Committee, in each case on a specified date or dates or over
any period or periods determined by the Committee. In making such determinations, the Committee shall consider (among such other
factors as it deems relevant in light of the specific type of award) the contributions, responsibilities and other compensation
of the particular Participant.

 

    	 	14	 

    	 

    

 

9.2
Performance Stock Units. Any Participant selected by the Committee may be granted one or more Performance Stock Unit awards
which shall be denominated in units of value including dollar value of shares of Stock and which may be linked to any one or more
of the Performance Goals or other specific performance criteria determined appropriate by the Committee, in each case on a specified
date or dates or over any period or periods determined by the Committee. In making such determinations, the Committee shall consider
(among such other factors as it deems relevant in light of the specific type of award) the contributions, responsibilities and
other compensation of the particular Participant.

 

9.3
Dividend Equivalents. Any Participant selected by the Committee may be granted Dividend Equivalents based on the dividends
declared on the Shares that are subject to any Award, to be credited as of dividend payment dates, during the period between the
date the Award is granted and the date the Award is exercised, vests or expires, as determined by the Committee. Such Dividend
Equivalents shall be converted to cash or additional shares of Stock by such formula and at such time and subject to such limitations
as may be determined by the Committee, in a matter consistent with the rules of Section 409A of the Code; provided that, to the
extent Shares subject to an Award are subject to vesting conditions, any Dividend Equivalents relating to such Shares shall be
subject to the same vesting conditions.

 

9.4
Deferred Stock. Any Participant selected by the Committee may be granted an award of Deferred Stock in the manner determined
from time to time by the Committee. The number of shares of Deferred Stock shall be determined by the Committee and may be linked
to the Performance Criteria or other specific performance criteria determined to be appropriate by the Committee, in each case
on a specified date or dates or over any period or periods determined by the Committee. Stock underlying a Deferred Stock Award
will not be issued until the Deferred Stock Award has vested, pursuant to a vesting schedule or performance criteria set by the
Committee. Unless otherwise provided by the Committee, a Participant awarded Deferred Stock shall have no rights as a Company
stockholder with respect to such Deferred Stock until such time as the Deferred Stock Award has vested and the Stock underlying
the Deferred Stock Award has been issued.

 

9.5
Other Stock-Based Awards. Any Participant selected by the Committee may be granted one or more Awards that provide Participants
with shares of Stock or the right to purchase shares of Stock or that have a value derived from the value of, or an exercise or
conversion privilege at a price related to, or that are otherwise payable in shares of Stock and which may be linked to any one
or more of the Performance Goals or other specific performance criteria determined appropriate by the Committee, in each case
on a specified date or dates or over any period or periods determined by the Committee. In making such determinations, the Committee
shall consider (among such other factors as it deems relevant in light of the specific type of Award) the contributions, responsibilities
and other compensation of the particular Participant.

 

9.6
Performance Bonus Awards. Any Participant selected by the Committee may be granted one or more Awards in the form of a
cash bonus (a “Performance Bonus Award”) payable upon the attainment of Performance Goals that are established
by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee.

 

9.7
Term. Except as otherwise provided herein, the term of any Award of Performance Shares, Performance Stock Units, Dividend
Equivalents, Deferred Stock, Other Stock-Based Award and Performance Bonus Award shall be set by the Committee in its discretion.

 

9.8
Exercise or Purchase Price. The Committee may establish the exercise or purchase price, if any, of any Award of Performance
Shares, Performance Stock Units, Deferred Stock, Other Stock-Based Award and Performance Bonus Award; provided, however, that
such price shall not be less than the Fair Market Value of a share of Stock on the date of grant, unless otherwise permitted by
Applicable Law.

 

    	 	15	 

    	 

    

 

9.9
Exercise Upon Termination of Employment or Service. An Award of Performance Shares, Performance Stock Units, Deferred Stock,
Other Stock-Based Award and Performance Bonus Award shall only be exercisable or payable while the Participant is an Employee,
Consultant or Non-Employee Director, as applicable; provided, however, that the Committee in its sole and absolute discretion
may provide that an Award of Performance Shares, Performance Stock Units, Deferred Stock, Stock Appreciation Rights, Other Stock-Based
Award and Performance Bonus Award may be exercised or paid subsequent to a Termination of Employment without Cause. In the event
of the Termination of Employment of a Participant by the Company for Cause, all Awards under this Article 9 shall be forfeited
by the Participant to the Company.

 

9.10
Form of Payment. Payments with respect to any Awards granted under this Article 9 shall be made in cash, in Stock
or a combination of both, as determined by the Committee.

 

9.11
Award Agreement. All Awards under this Article 9 shall be subject to such additional terms and conditions as determined
by the Committee and shall be evidenced by a written Award Agreement.

 

Article
10

 

Change
in Control

 

10.1
Vesting Upon Change in Control. For the avoidance of doubt, the Committee may not accelerate the vesting and exercisability
(as applicable) of any outstanding Awards, in whole or in part, solely upon the occurrence of a Change in Control except as provided
in this Section 10.1. In the event of a Change in Control after the date of the adoption of the Plan, then:

 

(a)
to the extent an outstanding Award subject solely to time-based vesting is not assumed or replaced by a comparable Award referencing
shares of the capital stock of the successor corporation or its “parent corporation” (as defined in Section 424(e)
of the Code) or “subsidiary corporation” (as defined in Section 424(f) of the Code) which is publicly traded on a
national stock exchange or quotation system, as determined by the Committee in its sole discretion, with appropriate adjustments
as to the number and kinds of shares and the exercise prices, if applicable, then any outstanding Award subject solely to time-based
vesting then held by Participants that is unexercisable, unvested or still subject to restrictions or forfeiture shall, in each
case as specified by the Committee in the applicable Award Agreement or otherwise, be deemed exercisable or otherwise vested,
as the case may be, as of immediately prior to such Change in Control;

 

(b)
all Awards that vest subject to the achievement of any performance goal, target performance level, or similar performance-related
requirement shall, in each case as specified by the Committee in the applicable Award Agreement or otherwise, either (A) be canceled
and terminated without any payment or consideration therefor; or (B) automatically vest based on: (1) actual achievement of any
applicable Performance Goals through the date of the Change in Control, as determined by the Committee in its sole discretion;
or (2) achievement of target performance levels (or the greater of actual achievement of any applicable Performance Goals through
the date of the Change in Control, as determined by the Committee in its sole discretion, and target performance levels); provided
that in the case of vesting based on target performance levels, such Awards shall also be prorated based on the portion of
the Performance Period elapsed prior to the Change in Control; and, in the case of this clause (B), shall be paid at the earliest
time permitted under the terms of the applicable agreement, plan or arrangement that will not trigger a tax or penalty under Section
409A of the Code, as determined by the Committee; and

 

(c)
Each outstanding Award that is assumed in connection with a Change in Control, or is otherwise to continue in effect subsequent
to the Change in Control, will be appropriately adjusted, immediately after the Change in Control, as to the number and class
of securities and other relevant terms in accordance with Section 4.3.

 

10.2
Termination of Employment Upon Change in Control. Notwithstanding any other provision of the Plan to the contrary, and
except as may otherwise be provided in any applicable Award Agreement or other written agreement entered into between the Company
or Affiliate and a Participant, upon (i) a Participant’s involuntary Termination of Employment without Cause on or within
one (1) year following a Change in Control, or (ii) a Participant’s Termination of Employment for Good
Reason (including the Termination of Employment of the Participant if he or she is employed by an Affiliate at the time the Company
sells or otherwise divests itself of such Affiliate), all outstanding Awards shall immediately become fully vested and exercisable;
provided that Restricted Stock Units shall be settled in accordance with the terms of the grant without regard to the Change
in Control unless the Change in Control constitutes a “change in control event” within the meaning of Section 409A
of the Code and such Termination of Employment occurs within one (1) year following such Change in Control,
in which case the Restricted Stock Units shall be settled and paid out with such Termination of Employment.

 

    	 	16	 

    	 

    

 

10.3
Cancellation and Termination of Awards. The Committee may, in connection with any merger, consolidation, share exchange
or other transaction entered into by the Company in good faith, determine that any outstanding Awards granted under the Plan,
whether or not vested, will be canceled and terminated and that in connection with such cancellation and termination the holder
of such Award may receive for each Share subject to such Award a cash payment (or the delivery of shares of stock, other securities
or a combination of cash, stock and securities equivalent to such cash payment) equal to the difference, if any, between the amount
determined by the Committee to be the Fair Market Value of the Stock and the purchase price per Share (if any) under the Award
multiplied by the number of Shares subject to such Award; provided that if such product is zero or less or to the extent that
the Award is not then exercisable, the Award will be canceled and terminated without payment therefor.

 

Article
11

 

Amendment,
Modification, and Termination

 

11.1
Amendment, Modification, and Termination of Plan. At any time and from time to time, the Board may amend, modify, alter,
suspend, discontinue or terminate the Plan, in whole or in part, without stockholder approval; provided, however, that (a) to
the extent necessary and desirable to comply with any Applicable Law, regulation, or stock exchange rule, the Company shall obtain
stockholder approval of any Plan amendment in such a manner and to such a degree as required, and (b) stockholder approval is
required for any amendment to the Plan that (i) increases the number of shares available under the Plan (other than any adjustment
as provided by Section 4.3) or the number of shares available for issuance as ISOs, or (ii) permits the Committee to grant
Options with an Exercise Price that is below Fair Market Value on the date of grant, or (iii) permits the Committee to extend
the exercise period for an Option beyond ten (10) years from the date of grant, or (iv) results in a material increase in benefits
or a change in eligibility requirements, or (v) change the granting corporation or (vi) the type of stock.

 

11.2
Amendment of Awards. Subject to Section 4.3, at any time and from time to time, the Committee may amend the terms
of any one or more outstanding Awards, provided that the Award as amended is consistent with the terms of the Plan or if necessary
or advisable for the purpose of conforming the Plan or an Award Agreement to any present or future law relating to plans of this
or similar nature (including, without limitation, Section 409A and, to the extent applicable, Section 162(m) of the Code), and
to the administrative regulations and rulings promulgated thereunder. Notwithstanding any provision in this Plan to the contrary,
absent approval of the stockholders of the Company, no Option may be amended to reduce the per share Exercise Price of the shares
subject to such Option below the per share exercise price as of the date the Option is granted and, except as permitted by Section
4.3, no Option may be granted in exchange for, or in connection with, the cancellation or surrender of an Option having a
higher per share Exercise Price.

 

11.3
Awards Previously Granted. No termination, amendment, or modification of the Plan or any Award shall adversely affect in
any material way any Award previously granted under the Plan, without the written consent of the Participant holding such Award;
provided, however, that any such modification made for the purpose of complying with Section 409A of the Code may be made by the
Company without the consent of any Participant.

 

11.4
Repricing and Backdating Prohibited. Notwithstanding anything in this Plan to the contrary, except as provided under Section
4.3 and Section 11.2, neither the Committee nor any other person may (i) amend the terms of outstanding Options or
SARs to reduce the exercise or grant price of such outstanding Options or SARs; (ii) cancel outstanding Options or SARs in exchange
for Options or SARs with an exercise or grant price that is less than the exercise price of the original Options or SARs; or (iii)
cancel outstanding Options or SARs with an exercise or grant price above the current Share price in exchange for cash or other
securities. In addition, the Committee may not make a grant of an Option or SAR with a grant date that is effective prior to the
date the Committee takes action to approve such Award.

 

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Article
12

 

Withholding

 

12.1
Tax Withholding. Unless otherwise provided by the Committee, the Company shall deduct or withhold any amount needed to
satisfy any foreign, federal, state, or local tax (including but not limited to the Participant’s employment tax obligations)
required by law to be withheld with respect to any taxable event arising or as a result of this Plan (“Withholding Taxes”).

 

12.2
Share Withholding. Unless otherwise provided by the Committee, upon the exercise of Options, the lapse of restrictions
on Restricted Stock, the vesting of Restricted Stock Units the distribution of Performance Shares in the form of Stock, or any
other taxable event hereunder involving the transfer of Stock to a Participant, the Company shall withhold Stock equal in value,
using the Fair Market Value on the date determined by the Company to be used to value the Stock for tax purposes, to the Withholding
Taxes applicable to such transaction.

 

Any
fractional Share of Stock payable to a Participant shall be withheld as additional Federal withholding, or, at the option of the
Company, paid in cash to the Participant.

 

Unless
otherwise determined by the Committee, when the method of payment for the Exercise Price is from the sale by a stockbroker pursuant
to Section 6.5(c), herein, of the Stock acquired through the Option exercise, then the tax withholding shall be satisfied
out of the proceeds. For administrative purposes in determining the amount of taxes due, the sale price of such Stock shall be
deemed to be the Fair Market Value of the Stock.

 

If
permitted by the Committee, prior to the end of any Performance Period a Participant may elect to have a greater amount of Stock
withheld from the distribution of Performance Shares to pay withholding taxes; provided, however, the Committee may prohibit or
limit any individual election or all such elections at any time.

 

Alternatively,
or in combination with the foregoing, the Committee may require Withholding Taxes to be paid in cash by the Participant or by
the sale of a portion of the Stock being distributed in connection with an Award, or by a combination thereof.

 

The
withholding of taxes is intended to comply with the requirements of Rule 10b5-1(c)(1)(i)(B) of the Exchange Act to the extent
permitted by law.

 

Article
13

 

General
Provisions Applicable to Awards

 

13.1
Minimum Vesting. Subject to Section 10.1, each Award shall have a minimum vesting period of one (1) year; provided
that the Committee may determine in its sole discretion that up to five percent (5%) of the Shares available for issuance under
the Plan may be granted free of such minimum vesting requirements.

 

13.2
Form of Payment. Subject to the provisions of this Plan, the Award Agreement and any Applicable Law, payments or transfers
to be made by the Company or any Affiliate on the grant, exercise, or settlement of any Award may be made in such form as determined
by the Committee including, without limitation, cash, Stock, other Awards, other property, or any combination thereof, and may
be made in a single payment or transfer, in installments, or any combination thereof, in each case determined by rules adopted
by the Committee.

 

13.3
Treatment of Dividends and Dividend Equivalents on Unvested Awards. Notwithstanding any other provision of the Plan to
the contrary, with respect to any Award that provides for or includes a right to dividends or Dividend Equivalents, if dividends
are declared during the period that an equity Award is outstanding, such dividends (or Dividend Equivalents) shall either (i)
not be paid or credited with respect to such Award or (ii) be accumulated but remain subject to vesting requirement(s) to the
same extent as the applicable Award and shall only be paid at the time or times such vesting requirement(s) are satisfied.

 

    	 	18	 

    	 

    

 

13.4
Limits on Transfer.

 

(a)
Except as otherwise provided in Section 13.4(b),

 

(i)
no Award may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or the laws of
descent and distribution or pursuant to a domestic relations order, unless and until such Award has been exercised, or the Shares
underlying such Award have been issues, and all restrictions applicable to such Shares have lapsed;

 

(ii)
no Award or interest or right therein shall be liable for or otherwise subject to the debts, contracts or engagements of the Participant
or the Participant’s successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge,
hypothecation, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation
of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy) unless and
until such Award has been exercised, or the Shares underlying such Award have been issued, and all restrictions applicable to
such Shares have lapsed, and any attempted disposition of an Award prior to satisfaction of these conditions shall be null and
void and of no effect, except to the extent that such disposition is permitted by Section 13.4(a)(i); and

 

(iii)
during a Participant’s lifetime, only the Participant or the Participant’s guardian or legal representative may exercise
an Award (or any portion thereof) granted to him or her under the Plan, unless it has been disposed of pursuant to a domestic
relations order. After a Participant’s death, any exercisable portion of an Award may, prior to the time when such portion
becomes unexercisable under the Plan or the applicable Award Agreement, be exercised by such Participant’s personal representative
or by any person empowered to do so under the deceased Participant’s will or under the then applicable laws of descent and
distribution.

 

(b)
Notwithstanding Section 13.4(a), the Committee, in its sole discretion, may determine to permit a Participant or a Permitted
Transferee of such Participant to transfer an Award other than an Incentive Stock Option (unless such Incentive Stock Option is
intended to become a Nonqualified Stock Option) to any one or more Permitted Transferees of such Participant without consideration,
subject to the following terms and conditions: (i) an Award transferred to a Permitted Transferee shall not be assignable or transferable
by the Permitted Transferee other than (A) to another Permitted Transferee of the applicable Participant or (B) by will or the
laws of descent and distribution or, subject to the consent of the Committee, pursuant to a domestic relations order; (ii) an
Award transferred to a Permitted Transferee shall continue to be subject to all the terms and conditions of the Award as applicable
to the original Participant (other than the ability to further transfer the Award to any person other than another Permitted Transferee
of the applicable Participant); and (iii) the Participant (or transferring Permitted Transferee) and the receiving Permitted Transferee
shall execute any and all documents requested by the Committee, including, without limitation documents to (A) confirm the status
of the transferee as a Permitted Transferee, (B) satisfy any requirements for an exemption for the transfer under Applicable Law
and (C) evidence the transfer. In addition, and further notwithstanding Section 13.4(a), hereof, the Committee, in its
sole discretion, may determine to permit a Participant to transfer Incentive Stock Options to a trust that constitutes a Permitted
Transferee if, under Section 671 of the Code and other Applicable Law, the Participant is considered the sole beneficial owner
of the Incentive Stock Option while it is held in the trust.

 

13.5
Beneficiaries. Notwithstanding Section 13.4, if provided in the applicable Award Agreement, a Participant may, in
the manner determined by the Committee, designate a beneficiary to exercise the rights of the Participant and to receive any distribution
with respect to any Award upon the Participant’s death. A beneficiary, legal guardian, legal representative, or other person
claiming any rights pursuant to the Plan is subject to all terms and conditions of the Plan and any Award Agreement applicable
to the Participant, except to the extent the Plan and Award Agreement otherwise provide, and to any additional restrictions deemed
necessary or appropriate by the Committee. If the Participant is married and resides in a community property state, a designation
of a person other than the Participant’s spouse as his or her beneficiary with respect to more than fifty percent (50%)
of the Participant’s interest in the Award shall not be effective without the prior written consent of the Participant’s
spouse. If no beneficiary has been designated or survives the Participant, payment shall be made to the person entitled thereto
pursuant to the Participant’s will or the laws of descent and distribution. Subject to the foregoing, a beneficiary designation
may be changed or revoked by a Participant at any time provided the change or revocation is filed with the Committee.

 

    	 	19	 

    	 

    

 

13.6
Forfeiture Events/Representations. The Committee may specify in an Award Agreement at the time of the Award that the Participant’s
rights, payments and benefits with respect to an Award shall be subject to reduction, cancellation, forfeiture or recoupment upon
the occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions of an Award.
Such events shall include, but shall not be limited to, termination of Service for Cause, violation of material Company policies,
breach of noncompetition, confidentiality or other restrictive covenants that may apply to the Participant, or other conduct by
the Participant that is detrimental to the business or reputation of the Company. The Committee may also specify in an Award Agreement
that the Participant’s rights, payments and benefits with respect to an Award shall be conditioned upon the Participant
making a representation regarding compliance with noncompetition, confidentiality or other restrictive covenants that may apply
to the Participant and providing that the Participant’s rights, payments and benefits with respect to an Award shall be
subject to reduction, cancellation, forfeiture or recoupment on account of a breach of such representation. In addition and without
limitation of the foregoing, any amounts paid hereunder shall be subject to recoupment in accordance with The Dodd–Frank
Wall Street Reform and Consumer Protection Act and any implementing regulations thereunder, any “clawback” policy
adopted by the Company or as is otherwise required by applicable law or stock exchange listing condition.

 

13.7
No Fractional Shares. No fractional Shares shall be issued or delivered pursuant to the Plan or any Award. The Committee
shall determine whether cash, Awards, or other property shall be issued or paid in lieu of fractional Shares or whether such fractional
Shares or any rights thereto shall be forfeited or otherwise eliminated.

 

13.8
Reservation of Stock. The Company shall at all times during the term of the Plan and any outstanding Awards granted hereunder
reserve or otherwise keep available such number of Shares of Stock as will be sufficient to satisfy the requirements of the Plan
(if then in effect) and the Awards and shall pay all fees and expenses necessarily incurred by the Company in connection therewith.

 

13.9
Reimbursement of Company for Unearned or Ill-gotten Gains. Unless otherwise specifically provided in an Award Agreement,
and to the extent permitted by Applicable Law, if the Company is required to prepare an accounting restatement due to the material
noncompliance of the Company with any financial reporting requirement under the securities laws, the Committee may, without obtaining
the approval or consent of the Company’s shareholders or of any Participant, require that any Participant who personally
engaged in one of more acts of fraud or misconduct that have caused or partially caused the need for such restatement or any current
or former chief executive officer, chief financial officer, or executive officer, regardless of their conduct, to reimburse the
Company in a manner consistent with Section 409A of the Code, if the Award constitutes “Non-Qualified Deferred Compensation,”
for all or any portion of any Awards granted or settled under this Plan (with each such case being a “Reimbursement”),
or the Committee may require the termination or rescission of, or the recapture associated with, any Award, in excess of the amount
the Participant would have received under the accounting restatement.

 

13.10
Delay in Payment. To the extent required in order to avoid the imposition of any interest and/or additional tax under Section
409A(a)(1)(B) of the Code, any amount that is considered deferred compensation under the Plan or Award Agreement and that is required
to be postponed pursuant to Section 409A of the Code, following the a Participant’s Termination of Employment shall be delayed
for six (6) months if a Participant is deemed to be a “specified employee” as defined in Section 409A(a)(2)(i)(B)
of the Code; provided that, if the Participant dies during the postponement period prior to the payment of the postponed amount,
the amounts withheld on account of Section 409A of the Code shall be paid to the executor or administrator of the decedent’s
estate within 60 days following the date of his death. A “Specified Employee” means any Participant who is
a “key employee” (as defined in Section 416(i) of the Code without regard to paragraph (5) thereof), as determined
by the Company in accordance with its uniform policy with respect to all arrangements subject to Section 409A of the Code, based
upon the twelve (12) month period ending on each December 31st (the “Identification Period”). All Participants
who are determined to be key employees under Section 416(i) of the Code (without regard to paragraph (5) thereof) during the identification
period shall be treated as Specified Employees for purposes of the Plan during the twelve (12) month period that begins on the
first day of the 4th month following the close of such identification period.

 

    	 	20	 

    	 

    

 

Article
14

 

Successors

 

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

 

Article
15

 

Miscellaneous
Provisions

 

15.1
Substitute Awards in Corporate Transactions. Nothing contained in the Plan shall be construed to limit the right of the
Committee to grant Awards under the Plan in connection with the acquisition, whether by purchase, merger, consolidation or other
corporate transaction, of the business or assets of any corporation or other entity. Without limiting the foregoing, the Committee
may grant Awards under the Plan to an employee or director of another corporation who becomes an Eligible Person by reason of
any such corporate transaction in substitution for awards previously granted by such corporation or entity to such person. The
terms and conditions of the substitute Awards may vary from the terms and conditions that would otherwise be required by the Plan
solely to the extent the Committee deems necessary for such purpose. Any shares of Stock subject to these substitute Awards shall
not be counted against any of the maximum share limitations set forth in the Plan.

 

15.2
409A Compliance. It is intended that all Awards issued under the Plan be in a form and administered in a manner that will
comply with the requirements of Section 409A of the Code, or the requirements of an exception to Section 409A of the Code, and
the Award Agreement and this Plan will be construed and administered in a manner that is consistent with and gives effect to such
intent. The Committee is authorized to adopt rules or regulations deemed necessary or appropriate to qualify for an exception
from or to comply with the requirements of Section 409A of the Code. With respect to an Award that constitutes a deferral of compensation
subject to Section 409A of the Code: (i) if any amount is payable under such Award upon a termination of service, a termination
of service will be treated as having occurred only at such time the Participant has experienced a “separation from service”
as such term is defined for purposes of Section 409A of the Code; (ii) if any amount is payable under such Award upon a disability,
a disability will be treated as having occurred only at such time the Participant has experienced a “disability” as
such term is defined for purposes of Section 409A of the Code; (iii) if any amount is payable under such Award on account of the
occurrence of a Change in Control, a Change in Control will be treated as having occurred only at such time a “change in
the ownership or effective control of the corporation or in the ownership of a substantial portion of the assets of the corporation”
has occurred as such terms are defined for purposes of Section 409A of the Code, (iv) if any amount becomes payable under such
Award on account of a Participant’s separation from service at such time as the Participant is a “specified employee”
within the meaning of Section 409A of the Code, then no payment shall be made, except as permitted under Section 409A of the Code,
prior to the first business day after the earlier of (y) the date that is six months after the date of the Participant’s
separation from service or (z) the Participant’s death, (v) any right to receive any installment payments under this Plan
shall be treated as a right to receive a series of separate payments and, accordingly, each installment payment hereunder shall
at all times be considered a separate and distinct payment, and (vi) no amendment to or payment under such Award will be made
except and only to the extent permitted under Section 409A of the Code.

 

Notwithstanding
the foregoing, the tax treatment of the benefits provided under the Plan or any Award Agreement is not warranted or guaranteed,
and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may
be incurred by the Participant on account of non-compliance with Section 409A of the Code.

 

15.3
Section 16(b) of the Exchange Act. All elections and transactions under the Plan by persons subject to Section 16 of the
Exchange Act involving shares of Stock are intended to comply with any applicable exemptive condition under Rule 16b-3. The Committee
may, in its sole discretion, establish and adopt written administrative guidelines, designed to facilitate compliance with Section
16(b) of the Exchange Act, as it may deem necessary or proper for the administration and operation of the Plan and the transaction
of business thereunder.

 

    	 	21	 

    	 

    

 

15.4
Unfunded Status of the Plan. The Plan is intended to constitute an “unfunded” plan for incentive compensation,
and the Plan is not intended to constitute a plan subject to the provisions of ERISA. With respect to any payments not yet made
to a Participant by the Company, nothing contained herein shall give any such Participant any rights that are greater than those
of a general creditor of the Company. In its sole discretion, the Committee may authorize the creation of trusts or other arrangements
to meet the obligations created under the Plan to deliver Stock or payments with respect to Options, Stock Appreciation Rights
and other Awards hereunder, provided, however, that the existence of such trusts or other arrangements is consistent with the
unfunded status of the Plan.

 

15.5
Nonexclusivity of the Plan. Neither the adoption of the Plan by the Board nor the submission of the Plan to the stockholders
of the Company shall be construed as creating any limitations on the power of the Board to adopt such other incentive arrangements
as it may deem desirable, including without limitation, the granting of stock options and restricted stock other than under the
Plan, and such arrangements may be either applicable generally or only in specific cases.

 

15.6
Investment Representations. The Company shall be under no obligation to issue any shares covered by any Award unless the
shares to be issued pursuant to Awards granted under the Plan have been effectively registered under the Securities Act of 1933,
as amended, or the Participant shall have made such written representations to the Company (upon which the Company believes it
may reasonably rely) as the Company may deem necessary or appropriate for purposes of confirming that the issuance of such shares
will be exempt from the registration requirements of that Act and any applicable state securities laws and otherwise in compliance
with all applicable laws, rules and regulations, including but not limited to that the Participant is acquiring the shares for
his or her own account for the purpose of investment and not with a view to, or for sale in connection with, the distribution
of any such shares.

 

15.7
Registration. If the Company shall deem it necessary or desirable to register under the Securities Act of 1933, as amended
or other applicable statutes any Shares of Stock issued or to be issued pursuant to Awards granted under the Plan, or to qualify
any such Shares of Stock for exemption from the Securities Act of 1933, as amended or other applicable statutes, then the Company
shall take such action at its own expense. The Company may require from each recipient of an Award, or each holder of Shares of
Stock acquired pursuant to the Plan, such information in writing for use in any registration statement, prospectus, preliminary
prospectus or offering circular as is reasonably necessary for that purpose and may require reasonable indemnity to the Company
and its officers and directors from that holder against all losses, claims, damage and liabilities arising from use of the information
so furnished and caused by any untrue statement of any material fact therein or caused by the omission to state a material fact
required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances under
which they were made. In addition, the Company may require of any such person that he or she agree that, without the prior written
consent of the Company or the managing underwriter in any public offering of Shares of Stock, he or she will not sell, make any
short sale of, loan, grant any option for the purchase of, pledge or otherwise encumber, or otherwise dispose of, any shares of
Stock during the 180 day period commencing on the effective date of the registration statement relating to the underwritten public
offering of securities. Without limiting the generality of the foregoing provisions of this Section 15.7, if in connection
with any underwritten public offering of securities of the Company the managing underwriter of such offering requires that the
Company’s directors and officers enter into a lock-up agreement containing provisions that are more restrictive than the
provisions set forth in the preceding sentence, then (a) each holder of shares of Stock acquired pursuant to the Plan (regardless
of whether such person has complied or complies with the provisions of clause (b) below) shall be bound by, and shall be deemed
to have agreed to, the same lock-up terms as those to which the Company’s directors and officers are required to adhere;
and (b) at the request of the Company or such managing underwriter, each such person shall execute and deliver a lock-up agreement
in form and substance equivalent to that which is required to be executed by the Company’s directors and officers.

 

15.8
Placement of Legends; Stop Orders; etc. Each share of Stock to be issued pursuant to Awards granted under the Plan may
bear a reference to the investment representation made in accordance with Section 15.4 in addition to any other applicable
restriction under the Plan, the terms of the Award and to the fact that no registration statement has been filed with the Securities
and Exchange Commission in respect to such shares of Stock. All shares of Stock or other securities delivered under the Plan shall
be subject to such stock transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations,
and other requirements of any stock exchange upon which the Stock is then listed, and any applicable federal or state securities
law, and the Committee may cause a legend or legends to be put on any certificates or recorded in connection with book-entry accounts
representing the shares to make appropriate reference to such restrictions.

 

    	 	22	 

    	 

    

 

15.9
Uncertificated Shares. To the extent that the Plan provides for issuance of certificates to reflect the transfer of Shares,
the transfer of such Shares may be effected on a noncertificated basis, to the extent not prohibited by Applicable Law.

 

15.10
Limitation of Rights in Stock. A Participant shall not be deemed for any purpose to be a stockholder of the Company with
respect to any of the Shares of Stock subject to an Award, unless and until Shares shall have been issued therefor and delivered
to the Participant or his agent. Any Stock to be issued pursuant to Awards granted under the Plan shall be subject to all restrictions
upon the transfer thereof which may be now or hereafter imposed by the Certificate of Incorporation and the Bylaws of the Company.

 

15.11
Employment Not Guaranteed. Nothing in the Plan shall interfere with or limit in any way the right of the Company (or any
Affiliate) to terminate any Participant’s Employment at any time, nor confer upon any Participant any right to continue
in the employ of the Company (or any Affiliate), subject to the terms of any separate employment or consulting agreement or provision
of law or corporate articles or by-laws to the contrary, at any time to terminate such employment or consulting agreement or to
increase or decrease, or otherwise adjust, the other terms and conditions of the recipient’s employment or other association
with the Company and its Affiliates.

 

15.12
Other Compensation Arrangements. Nothing contained in this Plan shall prevent the Board from adopting other or additional
compensation arrangements, subject to shareholder approval if such approval is required; and such arrangements may be either generally
applicable or applicable only in specific cases.

 

15.13
Gender and Number. Except where otherwise indicated by the context, any masculine term used herein also shall include the
feminine; the plural shall include the singular and the singular shall include the plural.

 

15.14
Severability. In the event any provision of the Plan shall be held illegal or invalid for any reason, the illegality or
invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as if the illegal or
invalid provision had not been included.

 

15.15
Requirements of Law. The granting of Awards and the issuance of Shares under the Plan shall be subject to Applicable Law
and to such approvals by any governmental agencies or national securities exchanges as may be required.

 

15.16
Errors. At any time the Company may correct any error made under the Plan without prejudice to the Company. Such corrections
may include, among other things, changing or revoking an issuance of an Award.

 

15.17
Elections and Notices. Notwithstanding anything to the contrary contained in this Plan, all elections and notices of every
kind shall be made on forms prepared by the Company or the General Counsel, Secretary or Assistant Secretary, or their respective
delegates or shall be made in such other manner as permitted or required by the Company or the General Counsel, Secretary or Assistant
Secretary, or their respective delegates, including but not limited to elections or notices through electronic means, over the
Internet or otherwise. An election shall be deemed made when received by the Company (or its designated agent, but only in cases
where the designated agent has been appointed for the purpose of receiving such election), which may waive any defects in form.
The Company may limit the time an election may be made in advance of any deadline.

 

Where
any notice or filing required or permitted to be given to the Company under the Plan, it shall be delivered to the principal office
of the Company, directed to the attention of the General Counsel of the Company or his or her successor. Such notice shall be
deemed given on the date of delivery.

 

Notice
to the Participant shall be deemed given when mailed (or sent by telecopy) to the Participant’s work or home address as
shown on the records of the Company or, at the option of the Company, to the Participant’s e-mail address as shown on the
records of the Company.

 

    	 	23	 

    	 

    

 

It
is the Participant’s responsibility to ensure that the Participant’s addresses are kept up to date on the records
of the Company. In the case of notices affecting multiple Participants, the notices may be given by general distribution at the
Participants’ work locations.

 

15.18
Governing Law. To the extent not preempted by Federal law, the Plan, and all awards and agreements hereunder, and any and
all disputes in connection therewith, shall be governed by and construed in accordance with the substantive laws of the State
of Delaware, without regard to conflict or choice of law principles which might otherwise refer the construction, interpretation
or enforceability of this Plan to the substantive law of another jurisdiction.

 

15.19
Venue. The Company and the Participant to whom an Award under this Plan is granted, for themselves and their successors
and assigns, irrevocably submit to the exclusive and sole jurisdiction and venue of the state or federal courts of Delaware with
respect to any and all disputes arising out of or relating to this Plan, the subject matter of this Plan or any awards under this
Plan, including but not limited to any disputes arising out of or relating to the interpretation and enforceability of any awards
or the terms and conditions of this Plan. To achieve certainty regarding the appropriate forum in which to prosecute and defend
actions arising out of or relating to this Plan, and to ensure consistency in application and interpretation of the Governing
Law to the Plan, the parties agree that (a) sole and exclusive appropriate venue for any such action shall be an appropriate federal
or state court in Delaware, and no other, (b) all claims with respect to any such action shall be heard and determined exclusively
in such Delaware court, and no other, (c) such Delaware court shall have sole and exclusive jurisdiction over the person of such
parties and over the subject matter of any dispute relating hereto and (d) that the parties waive any and all objections and defenses
to bringing any such action before such Delaware court, including but not limited to those relating to lack of personal jurisdiction,
improper venue or forum non conveniens.

 

15.20
No Obligation to Notify. The Company shall have no duty or obligation to any holder of an Option to advise such holder
as to the time or manner of exercising such Option. Furthermore, the Company shall have no duty or obligation to warn or otherwise
advise such holder of a pending transaction or expiration of an Option or a possible period in which the Option may not be exercised.
The Company has no duty or obligation to minimize the tax consequences of an Option to the holder of such Option.

 

    	 	24	 

    	 

    

 

POWERFLEET,
INC.

2018
INCENTIVE PLAN

ISRAELI
APPENDIX 

 

This
Israeli Appendix (the “Appendix”) to the 2018 Incentive Plan (as amended from time to time, the “Plan”)
of POWERFLEET, INC. (the “Company”) shall apply only to Participants (as defined in the Plan) who are, or are
deemed to be, residents of the State of Israel for Israeli tax purposes. This Appendix is made pursuant to Section 5.2 of the
Plan.

 

1. GENERAL

 

1.1.
The Committee, in its discretion, may grant Awards to eligible Participants and shall determine whether such Awards intended to
be 102 Awards or 3(9) Awards. Each Award shall be evidenced by an Award Agreement, which shall expressly identify the Award type,
and be in such form and contain such provisions, as the Committee shall from time to time deem appropriate.

 

1.2.
The Plan shall apply to any Awards granted pursuant to this Appendix, provided, that the provisions of this Appendix shall supersede
and govern in the case of any inconsistency or conflict, either explicit or implied, arising between the provisions of this Appendix
and the Plan.

 

1.3.
Unless otherwise defined in this Appendix, capitalized terms contained herein shall have the same meanings given to them in the
Plan.

 

2. DEFINITIONS.

 

2.1.
“3(9) Award” means any Award representing a right to purchase shares of Common Stock granted by the Company
to any Participant who is not an Employee pursuant to Section 3(9) of the Ordinance.

 

2.2.
“102 Award” means any Award intended to qualify (as set forth in the Award Agreement) and which qualifies under
Section 102, provided it is settled only in shares of Common Stock.

 

2.3.
“102 Capital Gain Track Award” means any Award granted by the Company to an Employee pursuant to Section 102(b)(2)
or (3) (as applicable) of the Ordinance under the capital gain track.

 

2.4.
“102 Non-Trustee Award” means any Award granted by the Company to an Employee pursuant to Section 102(c) of
the Ordinance without a Trustee.

 

2.5.
“102 Ordinary Income Track Award” means any Award granted by the Company to an Employee pursuant to Section
102(b)(1) of the Ordinance under the ordinary income track.

 

2.6.
“102 Trustee Awards” means, collectively, 102 Capital Gain Track Awards and 102 Ordinary Income Track Awards.

 

2.7.
“Affiliate” means, for purpose of 102 Trustee Award, an “employing company” within the meaning
and subject to the conditions of Section 102(a) of the Ordinance.

 

2.8.
“Applicable Law” shall mean any applicable law, rule, regulation, statute, pronouncement, policy, interpretation,
judgment, order or decree of any federal, provincial, state or local governmental, regulatory or adjudicative authority or agency,
of any jurisdiction, and the rules and regulations of any stock exchange, over-the-counter market or trading system on which the
common stock of the Company are then traded or listed.

 

2.9.
“Controlling Stockholder” means as to such term is defined in Section 32(9) of the Ordinance.

 

2.10.
“Election” as defined in Section ‎3.2 below.

 

    	 	25	 

    	 

    

 

2.11.
“Employee” means an “employee” within the meaning of Section 102(a) of the Ordinance (which as
of the date of the adoption of this Appendix means (i) an individual employed by an Israeli company being an Affiliate, and (ii)
an individual who is serving and is engaged personally (and not through an entity) as an “office holder” by an Affiliate,
excluding any Controlling Stockholder).

 

2.12.
“ITA” means the Israel Tax Authority.

 

2.13.
“Ordinance” means the Israeli Income Tax Ordinance (New Version), 1961, including the Rules and any other regulations,
rules, orders or procedures promulgated thereunder, as may be amended or replaced from time to time.

 

2.14.
“Required Holding Period” as defined in Section ‎3.5.1 below.

 

2.15.
“Rules” means the Income Tax Rules (Tax Reliefs in Stock Issuance to Employees) 5763-2003.

 

2.16.
“Section 102” means Section 102 of the Ordinance.

 

2.17.
“Trust Agreement” means the agreement to be signed between the Company, an Affiliate and the Trustee for the
purposes of Section 102.

 

2.18.
“Trustee” means the trustee appointed by the Company’s Board of Directors and/or by the Committee to
hold the Awards and approved by the ITA.

 

2.19.
“Withholding Obligations” as defined in Section ‎5.5 below.

 

3. 102 AWARDS

 

3.1.
Tracks. Awards granted pursuant to this Section ‎3 are intended to be granted as either 102 Capital Gain Track Awards
or 102 Ordinary Income Track Awards. 102 Trustee Awards shall be granted subject to the special terms and conditions contained
in this Section ‎3 and the general terms and conditions of the Plan, except for any provisions of the Plan applying to Awards
under different tax laws or regulations.

 

3.2.
Election of Track. Subject to Applicable Law, the Company may grant only one type of 102 Trustee Award at any given time
to all Participants who are to be granted 102 Trustee Awards pursuant to this Appendix, and shall file an election with the ITA
regarding the type of 102 Trustee Award it elects to grant before the date of grant of any 102 Trustee Award (the “Election”).
Such Election shall also apply to any other securities received by any Participant as a result of holding the 102 Trustee Awards.
The Company may change the type of 102 Trustee Award that it elects to grant only after the expiration of at least 12 months from
the end of the year in which the first grant was made in accordance with the previous Election, or as otherwise provided by Applicable
Law. Any Election shall not prevent the Company from granting 102 Non-Trustee Awards.

 

3.3.
Eligibility for Awards. Subject to Applicable Law, 102 Awards may only be granted to Employees. Such 102 Awards may either
be granted to a Trustee or granted under Section 102 without a Trustee.

 

3.4.
102 Award Grant Date.

 

3.4.1.
Each 102 Award will be deemed granted on the date determined by the Committee, subject to the provisions of the Plan, provided
that (i) the Participant has signed all documents required by the Company or pursuant to Applicable Law, and (ii) with respect
to any 102 Trustee Award, the Company has provided all applicable documents to the Trustee in accordance with the guidelines published
by the ITA.

 

    	 	26	 

    	 

    

 

3.4.2.
Unless otherwise permitted by the Ordinance, any grants of 102 Trustee Awards that are made on or after the date of the adoption
of the Plan and this Appendix or an amendment to the Plan or this Appendix, as the case may be, that may become effective only
at the expiration of thirty (30) days after the filing of the Plan and this Appendix or any amendment thereof (as the case may
be) with the ITA in accordance with the Ordinance shall be conditional upon the expiration of such 30-day period, and such condition
shall be read and is incorporated by reference into any corporate resolutions approving such grants and into any Award Agreement
evidencing such grants (whether or not explicitly referring to such condition), and the date of grant shall be at the expiration
of such 30-day period, whether or not the date of grant indicated therein corresponds with this Section. In the case of any contradiction,
this provision and the date of grant determined pursuant hereto shall supersede and be deemed to amend any date of grant indicated
in any corporate resolution or Award Agreement. Nevertheless, this 30-day period may be waived subject to a special tax ruling
to be obtained from the ITA and pursuant to its terms, or may not apply to any exchange of equity pursuant to a special tax ruling
and its terms.

 

3.5.
102 Trustee Awards.

 

3.5.1.
Each 102 Trustee Award, each share of Common Stock issued pursuant to the grant, exercise or vesting of any 102 Trustee Award
and any rights granted thereunder, shall be allocated or issued to and registered in the name of the Trustee and shall be held
in trust or controlled by the Trustee (pursuant to an approval from the ITA) for the benefit of the Participant for the requisite
period prescribed by the Ordinance or such longer period as set by the Committee (the “Required Holding Period”).
In the event that the requirements under Section 102 to qualify an Award as a 102 Trustee Award are not met, then the Award may
be treated as a 102 Non-Trustee Award or 3(9) Award (as determined by the Company), all in accordance with the provisions of the
Ordinance. After the expiration of the Required Holding Period, the Trustee may release such 102 Trustee Awards and any such shares
of Common Stock, provided that (i) the Trustee has received an acknowledgment from the ITA that the Participant has paid any applicable
taxes due pursuant to the Ordinance, or (ii) the Trustee and/or the Company and/or the Affiliate withhold(s) all applicable taxes
and compulsory payments due pursuant to the Ordinance arising from the 102 Trustee Awards and/or any shares of Common Stock issued
upon exercise or (if applicable) vesting of such 102 Trustee Awards. The Trustee shall not release any 102 Trustee Awards or shares
of Common Stock issued upon exercise or (if applicable) vesting thereof, or any rights received with respect to such Awards, prior
to the payment in full of the Participant’s tax and compulsory payments arising from such 102 Trustee Awards and/or shares
of Common Stock or the withholding referred to in (ii) above.

 

3.5.2.
Each 102 Trustee Award shall be subject to the relevant terms of the Ordinance, the Rules and any determinations, rulings or approvals
issued by the ITA, which shall be deemed an integral part of the 102 Trustee Awards and shall prevail over any term contained
in the Plan, this Appendix or the Award Agreement that is not consistent therewith. Any provision of the Ordinance, the Rules
and any determinations, rulings or approvals by the ITA not expressly specified in the Plan, this Appendix or Award Agreement
that are necessary to receive or maintain any tax benefit pursuant to Section 102 shall be binding on the Participant. The Participant
granted a 102 Trustee Award shall comply with the Ordinance and the terms and conditions of the Trust Agreement entered into between
the Company and the Trustee. The Participant shall execute any and all documents that the Company and/or the Affiliate and/or
the Trustee determine from time to time to be necessary in order to comply with the Ordinance and the Rules.

 

3.5.3.
During the Required Holding Period, the Participant shall not release from trust or sell, assign, transfer or give as collateral,
the shares of Common Stock issuable upon the exercise or (if applicable) vesting of a 102 Trustee Award and/or any securities
issued or distributed with respect thereto, until the expiration of the Required Holding Period. Notwithstanding the above, if
any such sale, release or other action occurs during the Required Holding Period it may result in adverse tax consequences to
the Participant under Section 102 and the Rules, which shall apply to and shall be borne solely by such Participant. Subject to
the foregoing, the Trustee may, pursuant to a written request from the Participant, but subject to the terms of the Plan and this
Appendix, release and transfer such shares of Common Stock to a designated third party, provided that both of the following conditions
have been fulfilled prior to such release or transfer: (i) payment has been made to the ITA of all taxes and compulsory payments
required to be paid upon the release and transfer of the shares of Common Stock, and confirmation of such payment has been received
by the Trustee and the Company, and (ii) the Trustee has received written confirmation from the Company that all requirements
for such release and transfer have been fulfilled according to the terms of the Company’s corporate documents, any agreement
governing the shares of Common Stock, the Plan, this Appendix, the Award Agreement and any Applicable Law.

 

3.5.4.
If a 102 Trustee Award is exercised or (if applicable) vested, the shares of Common Stock issued upon such exercise or (if applicable)
vesting shall be issued in the name of the Trustee for the benefit of the Participant, or shall be deposited with the Trustee,
or be subject to the Trustee’s control, if approved by the ITA.

 

    	 	27	 

    	 

    

 

3.5.5.
Upon or after receipt of a 102 Trustee Award, if required, the Participant may be required to sign an undertaking to release the
Trustee from any liability with respect to any action or decision duly taken and executed in good faith by the Trustee in relation
to the Plan, this Appendix, or any 102 Trustee Awards granted to such Participant hereunder.

 

3.6.
102 Non-Trustee Awards. The foregoing provisions of this Section ‎3 relating to 102 Trustee Awards shall not apply
with respect to 102 Non-Trustee Awards, which shall, however, be subject to the relevant provisions of Section 102 and the applicable
Rules. The Committee may determine that 102 Non-Trustee Awards, the shares of Common Stock issuable upon the exercise or (if applicable)
vesting of a 102 Non-Trustee Award and/or any securities issued or distributed with respect thereto, shall be allocated or issued
to the Trustee, who shall hold such 102 Non-Trustee Award and all accrued rights thereon (if any) in trust for the benefit of
the Participant and/or the Company, as the case may be, until the full payment of tax arising from the 102 Non-Trustee Awards,
the shares of Common Stock issuable upon the exercise or (if applicable) vesting of a 102 Non-Trustee Award and/or any securities
issued or distributed with respect thereto. The Company may choose, alternatively, to require the Participant to provide the Company
with a guarantee or other security, to the satisfaction of each of the Trustee and the Company, until the full payment of the
applicable taxes.

 

3.7.
Written Participant Undertaking. With respect to any 102 Trustee Award, as required by Section 102 and the Rules, by virtue
of the receipt of such Award, the Participant is deemed to have undertaken and confirmed in writing the following (and such undertaking
is deemed incorporated into any documents signed by the Participant in connection with the employment or service of the Participant
and/or the grant of such Award). The following written undertaking shall be deemed to apply and relate to all 102 Trustee Awards
granted to the Participant, whether under the Plan and this Appendix or other plans maintained by the Company, and whether prior
to or after the date hereof:

 

3.7.1.
The Participant shall comply with all terms and conditions set forth in Section 102 with regard to the “Capital Gain Track”
or the “Ordinary Income Track”, as applicable, and the applicable rules and regulations promulgated thereunder, as
amended from time to time;

 

3.7.2.
The Participant is familiar with, and understands the provisions of, Section 102 in general, and the tax arrangement under the
“Capital Gain Track” or the “Ordinary Income Track” in particular, and its tax consequences; the Participant
agrees that the 102 Trustee Awards and shares of Common Stock that may be issued upon exercise or (if applicable) vesting of the
102 Trustee Awards (or otherwise in relation to the Awards), will be held by a trustee appointed pursuant to Section 102 for at
least the duration of the “Holding Period” (as such term is defined in Section 102) under the “Capital Gain
Track” or the “Ordinary Income Track”, as applicable. The Participant understands that any release of such 102
Trustee Awards or shares of Common Stock from trust, or any sale of the shares of Common Stock prior to the termination of the
Holding Period, as defined above, will result in taxation at the marginal tax rate, in addition to deductions of appropriate social
security, health tax contributions or other compulsory payments; and

 

3.7.3.
The Participant agrees to the trust deed signed between the Company, his employing company and the trustee appointed pursuant
to Section 102.

 

4. 3(9) AWARDS

 

4.1.
Awards granted pursuant to this Section ‎4 are intended to constitute 3(9) Awards and shall be granted subject to the general
terms and conditions of the Plan, except for any provisions of the Plan applying to Awards under different tax laws or regulations.
In the event of any inconsistency or contradictions between the provisions of this Section ‎4 and the other terms of the Plan,
this Section ‎4 shall prevail.

 

    	 	28	 

    	 

    

 

4.2.
To the extent required by the Ordinance or the ITA or otherwise deemed by the Committee to be advisable, the 3(9) Awards and/or
any shares of Common Stock or other securities issued or distributed with respect thereto granted pursuant to the Plan and this
Appendix shall be issued to a trustee nominated by the Committee in accordance with the provisions of the Ordinance. In such event,
the trustee shall hold such Awards and/or any shares of Common Stock or other securities issued or distributed with respect thereto
in trust, until exercised by the Participant or (if applicable) vested, and the full payment of tax arising therefrom, pursuant
to the Company’s instructions from time to time as set forth in a trust agreement, which will have been entered into between
the Company and the trustee. If determined by the Committee, and subject to such trust agreement, the Trustee shall be responsible
for withholding any taxes to which a Participant may become liable upon issuance of shares of Common Stock, whether due to the
exercise or (if applicable) vesting of Awards.

 

4.3.
Shares of Common Stock pursuant to a 3(9) Award shall not be issued, unless the Participant delivers to the Company payment in
cash or by bank check or such other form acceptable to the Committee of all withholding taxes due, if any, on account of the Participant
acquiring shares of Common Stock under the Award or the Participant provides other assurance satisfactory to the Committee of
the payment of those withholding taxes.

 

5. AGREEMENT REGARDING TAXES; DISCLAIMER

 

5.1.
If the Committee shall so require, as a condition of exercise of an Award or the release of shares of Common Stock by the Trustee,
a Participant shall agree that, no later than the date of such occurrence, the Participant will pay to the Company (or the Trustee,
as applicable) or make arrangements satisfactory to the Committee and the Trustee (if applicable) regarding payment of any applicable
taxes and compulsory payments of any kind required by Applicable Law to be withheld or paid.

 

5.2.
TAX LIABILITY. ALL TAX CONSEQUENCES UNDER ANY APPLICABLE LAW WHICH MAY ARISE FROM THE GRANT OF ANY AWARDS OR THE EXERCISE
THEREOF, THE SALE OR DISPOSITION OF ANY SHARES OF COMMON STOCK GRANTED HEREUNDER OR ISSUED UPON EXERCISE OR (IF APPLICABLE) VESTING
OF ANY AWARD, THE ASSUMPTION, SUBSTITUTION, CANCELLATION OR PAYMENT IN LIEU OF AWARDS OR FROM ANY OTHER ACTION IN CONNECTION WITH
THE FOREGOING (INCLUDING WITHOUT LIMITATION ANY TAXES AND COMPULSORY PAYMENTS, SUCH AS SOCIAL SECURITY OR HEALTH TAX PAYABLE BY
THE PARTICIPANT OR THE COMPANY IN CONNECTION THEREWITH) SHALL BE BORNE AND PAID SOLELY BY THE PARTICIPANT, AND THE PARTICIPANT
SHALL INDEMNIFY THE COMPANY, THE AFFILIATE AND THE TRUSTEE, AND SHALL HOLD THEM HARMLESS AGAINST AND FROM ANY LIABILITY FOR ANY
SUCH TAX OR PAYMENT OR ANY PENALTY, INTEREST OR INDEXATION THEREON. EACH PARTICIPANT AGREES TO, AND UNDERTAKES TO COMPLY WITH,
ANY RULING, SETTLEMENT, CLOSING AGREEMENT OR OTHER SIMILAR AGREEMENT OR ARRANGEMENT WITH ANY TAX AUTHORITY IN CONNECTION WITH
THE FOREGOING WHICH IS APPROVED BY THE COMPANY.

 

5.3.
NO TAX ADVICE. THE PARTICIPANT IS ADVISED TO CONSULT WITH A TAX ADVISOR WITH RESPECT TO THE TAX CONSEQUENCES OF RECEIVING,
EXERCISING OR DISPOSING OF AWARDS HEREUNDER. THE COMPANY DOES NOT ASSUME ANY RESPONSIBILITY TO ADVISE THE PARTICIPANT ON SUCH
MATTERS, WHICH SHALL REMAIN SOLELY THE RESPONSIBILITY OF THE PARTICIPANT.

 

5.4.
TAX TREATMENT. THE COMPANY DOES NOT UNDERTAKE OR ASSUME ANY LIABILITY OR RESPONSIBILITY TO THE EFFECT THAT ANY AWARD SHALL
QUALIFY WITH ANY PARTICULAR TAX REGIME OR RULES APPLYING TO PARTICULAR TAX TREATMENT, OR BENEFIT FROM ANY PARTICULAR TAX TREATMENT
OR TAX ADVANTAGE OF ANY TYPE AND THE COMPANY SHALL BEAR NO LIABILITY IN CONNECTION WITH THE MANNER IN WHICH ANY AWARD IS EVENTUALLY
TREATED FOR TAX PURPOSES, REGARDLESS OF WHETHER THE AWARD WAS GRANTED OR WAS INTENDED TO QUALIFY UNDER ANY PARTICULAR TAX REGIME
OR TREATMENT. THIS PROVISION SHALL SUPERSEDE ANY DESIGNATION OF AWARDS OR TAX QUALIFICATION INDICATED IN ANY CORPORATE RESOLUTION
OR AWARD AGREEMENT, WHICH SHALL AT ALL TIMES BE SUBJECT TO THE REQUIREMENTS OF APPLICABLE LAW. THE COMPANY DOES NOT UNDERTAKE
AND SHALL NOT BE REQUIRED TO TAKE ANY ACTION IN ORDER TO QUALIFY ANY AWARD WITH THE REQUIREMENTS OF ANY PARTICULAR TAX TREATMENT
AND NO INDICATION IN ANY DOCUMENT TO THE EFFECT THAT ANY AWARD IS INTENDED TO QUALIFY FOR ANY TAX TREATMENT SHALL IMPLY SUCH AN
UNDERTAKING. NO ASSURANCE IS MADE BY THE COMPANY OR THE AFFILIATE THAT ANY PARTICULAR TAX TREATMENT ON THE DATE OF GRANT WILL
CONTINUE TO EXIST OR THAT THE AWARD WILL QUALIFY AT THE TIME OF EXERCISE OR DISPOSITION THEREOF WITH ANY PARTICULAR TAX TREATMENT.
THE COMPANY AND THE AFFILIATE SHALL NOT HAVE ANY LIABILITY OR OBLIGATION OF ANY NATURE IN THE EVENT THAT AN AWARD DOES NOT QUALIFY
FOR ANY PARTICULAR TAX TREATMENT, REGARDLESS WHETHER THE COMPANY COULD HAVE TAKEN ANY ACTION TO CAUSE SUCH QUALIFICATION TO BE
MET AND SUCH QUALIFICATION REMAINS AT ALL TIMES AND UNDER ALL CIRCUMSTANCES AT THE RISK OF THE PARTICIPANT. THE COMPANY DOES NOT
UNDERTAKE OR ASSUME ANY LIABILITY TO CONTEST A DETERMINATION OR INTERPRETATION (WHETHER WRITTEN OR UNWRITTEN) OF ANY TAX AUTHORITY,
INCLUDING IN RESPECT OF THE QUALIFICATION UNDER ANY PARTICULAR TAX REGIME OR RULES APPLYING TO PARTICULAR TAX TREATMENT. IF THE
AWARDS DO NOT QUALIFY UNDER ANY PARTICULAR TAX TREATMENT IT COULD RESULT IN ADVERSE TAX CONSEQUENCES TO THE PARTICIPANT.

 

    	 	29	 

    	 

    

 

5.5.
The Company or the Affiliate may take such action as it may deem necessary or appropriate, in its discretion, for the purpose
of or in connection with withholding of any taxes and compulsory payments which the Trustee, the Company or the Affiliate is required
by any Applicable Law to withhold in connection with any Awards (collectively, “Withholding Obligations”).
Such actions may include (i) requiring Participants to remit to the Company in cash an amount sufficient to satisfy such Withholding
Obligations and any other taxes and compulsory payments, payable by the Company in connection with the Award or the exercise or
(if applicable) vesting thereof; (ii) subject to Applicable Law, allowing the Participants to provide shares of Common Stock,
in an amount that at such time, reflects a value that the Committee determines to be sufficient to satisfy such Withholding Obligations;
(iii) withholding shares of Common Stock otherwise issuable upon the exercise of an Award at a value which is determined by the
Committee to be sufficient to satisfy such Withholding Obligations; or (iv) any combination of the foregoing. The Company shall
not be obligated to allow the exercise of any Award by or on behalf of a Participant until all tax consequences arising from the
exercise of such Award are resolved in a manner acceptable to the Company.

 

5.6.
Each Participant shall notify the Company in writing promptly and in any event within ten (10) days after the date on which such
Participant first obtains knowledge of any tax bureau inquiry, audit, assertion, determination, investigation, or question relating
in any manner to the Awards granted or received hereunder or shares of Common Stock issued thereunder and shall continuously inform
the Company of any developments, proceedings, discussions and negotiations relating to such matter, and shall allow the Company
and its representatives to participate in any proceedings and discussions concerning such matters. Upon request, a Participant
shall provide to the Company any information or document relating to any matter described in the preceding sentence, which the
Company, in its discretion, requires.

 

5.7.
With respect to 102 Non-Trustee Awards, if the Participant ceases to be employed by the Company or any Affiliate, the Participant
shall extend to the Company and/or the Affiliate with whom the Participant is employed a security or guarantee for the payment
of taxes due at the time of sale of shares of Common Stock, all in accordance with the provisions of Section 102 and the Rules.

 

6. RIGHTS AND OBLIGATIONS AS A STOCKHOLDER

 

6.1.
A Participant shall have no rights as a stockholder of the Company with respect to any shares of Common Stock covered by an Award
until the Participant exercises the Award, pays the exercise price therefor and becomes the record holder of the subject shares
of Common Stock. In the case of 102 Awards or 3(9) Awards (if such Awards are being held by a Trustee), the Trustee shall have
no rights as a stockholder of the Company with respect to the shares of Common Stock covered by such Award until the Trustee becomes
the record holder for such Common Stock for the Participant’s benefit, and the Participant shall not be deemed to be a stockholder
and shall have no rights as a stockholder of the Company with respect to the shares of Common Stock covered by the Award until
the date of the release of such shares of Common Stock from the Trustee to the Participant and the transfer of record ownership
of such shares of Common Stock to the Participant (provided however that the Participant shall be entitled to receive from the
Trustee any cash dividend or distribution made on account of the shares of Common Stock held by the Trustee for such Participant’s
benefit, subject to any tax withholding and compulsory payment). No adjustment shall be made for dividends (ordinary or extraordinary,
whether in cash, securities or other property) or distribution of other rights for which the record date is prior to the date
on which the Participant or Trustee (as applicable) becomes the record holder of the shares of Common Stock covered by an Award,
except as provided in the Plan.

 

6.2.
With respect to shares of Common Stock issued upon the exercise or (if applicable) vesting of Awards hereunder, any and all voting
rights attached to such Common Stock shall be subject to the provisions of the Plan, and the Participant shall be entitled to
receive dividends distributed with respect to such shares of Common Stock, subject to the provisions of the Company’s Certificate
of Incorporation, as amended from time to time, and subject to any Applicable Law (after deduction of all applicable tax payments).

 

7. GOVERNING LAW

 

7.1.
This Appendix shall be governed by, construed and enforced in accordance with the laws of the State of Delaware, without reference
to conflicts of law principles, except that applicable Israeli laws, rules and regulations (as amended) shall apply to any mandatory
tax matters arising hereunder.

 

****

 

    	 	30Exhibit 10.1

 

WARRANT EXERCISE AGREEMENT

 

This Warrant Exercise Agreement (this “Agreement”), dated as of October 2, 2019, is between Jaguar Health, Inc. (the “Company”) and the purchaser signatory thereto (the “Purchaser”).  Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock (the “Series B Certificate of Designation”) and the Series 1 Warrants (as defined below).

 

WHEREAS, pursuant to a registration statement on Form S-1 (File No. 333-231399) (the “July 2019 Registration Statement”) and a prospectus dated July 19, 2019, the Company made an underwritten offering of shares of common stock, par value $0.0001 per share (“Common Stock”), shares of Series B Convertible Preferred Stock (“Series B Preferred Stock”), Series 1 Common Stock purchase warrants (“Series 1 Warrants”) and Series 2 Common Stock purchase warrants (“Series 2 Warrants”);

 

WHEREAS, the Purchaser holds shares of Series B Preferred Stock and Series 1 Warrants (the “Purchaser Series B Preferred Shares” and the “Purchaser Series 1 Warrants”), as set forth on the signature page hereto;

 

WHEREAS, 985,500 shares of Common Stock (the “Series B Conversion Shares”) are issuable upon conversion of the Purchaser Series B Preferred Shares in accordance with the terms of the Series B Certificate of Designation; and

 

WHEREAS, the Purchaser wishes to exercise all of the Purchaser Series 1 Warrants and, in consideration thereof, the Company desires to issue to Purchaser the Series B-1 Preferred Shares (as defined below) in accordance with the provisions of this Agreement, which Series B-1 Preferred Shares will be convertible into shares of Common Stock (the “Series B-1 Conversion Shares”) in accordance with the terms of the Series B-1 Certificate of Designation (as defined below);

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Purchaser hereby agrees as follows:

 

1.                                      Put.  The Company and the Purchaser hereby agree that, provided that the Purchaser is not in possession of any information that constitutes, or might constitute, material non-public information which was provided by the Company, any of its Subsidiaries, or any of their officers, directors, employees, agents or Affiliates, then the Company may, within one (1) Trading Day of the date hereof, put all or any portion of the Purchaser Series 1 Warrants for which a Notice of Exercise has not yet been delivered (such right, a “Put”) to the Purchaser.  To exercise this right, the Company must deliver to the Purchaser an irrevocable written notice (a “Put Notice”) in substantially the form set forth in Exhibit B hereto, indicating therein the portion of unexercised portion of the Purchaser Series 1 Warrants to which such Put Notice applies.  If the conditions set forth below for such Put are satisfied from the period from the date of the Put Notice through and including the Put Date (as defined below), then the Purchaser shall (a) deliver an executed Notice of Exercise covering any portion of the Purchaser Series 1 Warrants subject to such Put Notice at 6:30 p.m. (New York City time) and (b) the aggregate 

 

 

cash exercise price for such exercise of the  Purchaser Series 1 Warrants to the bank account set forth on the Company’s signature page hereto on the second (2nd) Trading Day after the date on which the Put Notice is received by the Purchaser (such date and time, the “Put Date”). Any unexercised portion of the Purchaser Series 1 Warrants to which the Put Notice does not pertain will be unaffected by such Put Notice.  The parties agree that any Notice of Exercise delivered following a Put Notice which covers less than all of the Purchaser Series 1 Warrants shall first reduce to zero the number of Warrant Shares subject to such Put Notice prior to reducing the remaining Warrant Shares available for purchase under the Purchaser Series 1 Warrants.  For example, if (A) the Purchaser Series 1 Warrants then permits the Purchaser to acquire 100 Warrant Shares, (B) a Put Notice pertains to 75 Warrant Shares, and (C) prior to 6:30 p.m. (New York City time) on the Put Date the Purchaser tenders a Notice of Exercise in respect of 50 Warrant Shares, then (x) on the Put Date the Purchaser will be required to tender a Notice of Exercise with respect to 25 Warrant Shares, (y) the Company, in the time and manner required under the Purchaser Series 1 Warrants, will have issued and delivered to the Purchaser 50 Warrant Shares in respect of the exercises following receipt of the Put Notice, and (z) the Purchaser may, until the Termination Date, exercise the Purchaser Series 1 Warrants for 25 Warrant Shares (subject to adjustment as herein provided and subject to subsequent Put Notices).  Subject again to the provisions herein, the Company may deliver subsequent Put Notices for any portion of this Warrant for which the Purchaser shall not have delivered a Notice of Exercise.  Notwithstanding anything to the contrary set forth herein, the Company may not deliver a Put Notice of any Purchaser Series 1 Warrant (and any such Put Notice shall be void), unless, from the date on which the Put Notice is received by the Purchaser through the Put Date, (1) the Company shall have honored in accordance with the terms of such Purchaser Series 1 Warrant all Notices of Exercise delivered by 6:30 p.m. (New York City time) on the Put Date, and (2) a registration statement shall be effective as to all Warrant Shares and the prospectus thereunder available for use by the Company for the sale of all such Warrant Shares to the Purchaser, and (3) the Common Stock shall be listed or quoted for trading on the Trading Market, and (4) there is a sufficient number of authorized shares of Common Stock for issuance of all Warrant Shares.  In addition, the Company agrees that, after a Put Notice hereunder, in the event that any exercise by the Purchaser of the Purchaser Series 1 Warrants that would cause the Purchaser to exceed the Beneficial Ownership Limitation in Section 2(e) of the Purchaser Series 1 Warrants, the Company shall only issue such number of Warrant Shares to the Purchaser (as instructed in writing by the Purchaser) that would not cause the Purchaser to exceed the maximum number of shares of Common Stock permitted under the Beneficial Ownership Limitation with the balance of such Warrant Shares to be held in abeyance until the balance (or portion thereof) may be issued in compliance with the Beneficial Ownership Limitation.  The Purchaser shall provide written notice to the Company promptly when any additional Warrant Shares may be issued in compliance with the Beneficial Ownership Limitation.  The balance of the Warrants shall promptly be issued to the Purchaser when the Purchaser provides notice that the Purchaser holds less than the Beneficial Ownership Limitation.  Defined terms used in this Section 1 but not defined herein shall have the meanings ascribed to such terms in the Purchaser Series 1 Warrants.

 

2.                                      Issuance of Series B-1 Preferred Shares. Upon any exercise of a Series 1 Warrant by the Purchaser, the Company agrees to issue to the Purchaser a number of shares of Series B-1 Convertible Preferred Stock (the “Series B-1 Preferred Shares”) in an amount equal to one (1) Series B-1 Preferred Share for every 19,841 Series 1 Warrant Shares issued thereunder (or such 

 

2

 

fractional amounts for lesser amounts received). Within two Trading Days of each date of exercise (such date, an “Issue Date”), the Company shall deliver a certificate representing the applicable  Series B-1 Preferred Shares.  Within two Trading Days of the date hereof, the Company shall file the Certificate of Designation of Preferences, Rights and Limitations of Series B-1 Convertible Preferred Stock (“Series B-1 Certificate of Designation”) in the form set forth in Exhibit A hereto with the State of Delaware and deliver to the Purchaser evidence of the filing of the Series B-1 Certificate of Designation with the State of Delaware.

 

3.                                      Registration Rights.

 

(a)                                 The Company hereby agrees that, within fifteen (15) days after the date hereof, the Company shall file a registration statement on Form S-1 (the “Registration Statement”) with the U.S. Securities and Exchange Commission (“Commission”) with respect to the Registrable Securities.  The Company shall use its commercially reasonable efforts to cause the Registration Statement to be declared effective under the Securities Act of 1933, as amended (the “Securities Act”) as promptly as possible but in any case no later than sixty (60) days after the filing thereof (the “Effectiveness Deadline”), and shall use its commercially reasonable efforts to keep such Registration Statement continuously effective under the Securities Act during the entire Effectiveness Period (as such term is defined below along with any other terms used in this Section 4).

 

(b)                                 Notwithstanding anything in this Section to the contrary and subject to the payment of Liquidated Damages (as defined below), the Company may, on no more than two occasions during any 12-month period, delay or suspend the effectiveness of the Registration Statement for up to sixty (60) days on each occasion (a “Delay Period”) if the board of directors of the Company determines in good faith that (i) effectiveness of the Registration Statement must be suspended in accordance with the rules and regulations under the Securities Act or that (ii) the disclosure of material non-public information (“Pending Developments”) at such time would be detrimental to the Company and its Subsidiaries, taken as a whole.  Notwithstanding the foregoing, the Company shall use its reasonable best efforts to ensure that the Registration Statement is declared effective and its permitted use is resumed following a Delay Period as promptly as practicable.

 

(c)                                  All fees and expenses incident to the performance of or compliance with this Section by the Company shall be borne by the Company whether or not any Registrable Securities are sold pursuant to a Registration Statement.

 

(d)                                 If a Registration Statement is not declared effective by the Commission prior to the Effectiveness Deadline (a “Registration Delay”), the Company shall pay to the Holder as to any Registrable Securities not eligible for resale as a result of such Registration Delay, for the duration of the Registration Delay, an amount equal to two percent (2%) of the Securities Market Value of such Registrable Securities per thirty (30) days (or portion thereof), payable in cash on the second business day of each calendar month in respect of payments accruing through the last day of the preceding calendar month (the payments described in this Section 3(d), the “Liquidated Damages”). Notwithstanding anything to the contrary set forth in this Section 3, no payment shall be owed hereunder if the primary cause of the Registration Delay (i) was consented to in writing by the Holder or (ii) results (and shall not be considered a 

 

3

 

Registration Delay for as long as it continues to result) solely from any breach or delay in performance by the Holder of any of its obligations set forth in this Agreement.

 

(e)                                  Legends. The Company covenants that the legend set forth in Section 5(g) shall be removed and the Company shall (and/or shall instruct its transfer agent to) issue a certificate without such legend to the holder of the Series B-1 Preferred Shares and any securities issued in respect thereof or exchange thereof (including Series B-1 Conversion Shares) upon which it is stamped, unless otherwise required by state securities laws, if (i) such Series B-1 Preferred Shares or any securities issued in respect thereof or exchange (including Series B-1 Conversion Shares) are registered for resale under the Securities Act, (ii) in connection with a sale, assignment or other transfer, such holder provides the Company with an opinion of counsel, in a generally acceptable form, to the effect that such sale, assignment or transfer of the Series B-1 Preferred Shares or any securities issued in respect thereof or exchange (including Series B-1 Conversion Shares) may be made without registration under the applicable requirements of the Securities Act and the purchaser, assignee or transferee, as the case may be, may receive a certificate without such legend, or (iii) such holder provides the Company with reasonable assurance that the Series B-1 Preferred Shares or any securities issued in respect thereof or exchange (including Series B-1 Conversion Shares) can be sold, assigned or transferred pursuant to Rule 144(b)(1)(i) (the earliest to occur of clauses (i)-(iii), “Legend Removal Date”).  On or before the Legend Removal Date, Company shall promptly deliver any authorizations, certificates and directions required by the Company’s transfer agent authorizing and directing such transfer agent to transfer such Series B-1 Preferred Shares or any securities issued in respect thereof or exchange (including Series B-1 Conversion Shares) without legend of such Series B-1 Preferred Shares or any securities issued in respect thereof (including Series B-1 Conversion Shares) under the Registration Statement.  The Company shall pay to the Purchaser, for the duration of the period beginning two (2) business days following the Legend Removal Date and ending on the date upon which the Company delivers Series B-1 Preferred Shares without the legend, liquidated damages equal to two percent (2%) of the Securities Market Value of the Series B-1 Preferred Shares then outstanding that are held by the Purchaser and notated with the legend per thirty (30) days (or portion thereof), payable in cash on the second business day of each calendar month in respect of payments accruing through the last day of the preceding calendar month.

 

(f)                                   As used in this Section, the following terms have the respective meanings:

 

“Effectiveness Period” means, the period commencing on the Registration Statement Effective Date and ending on the earlier of (i) the time as all of the Registrable Securities covered by such Registration Statement have been sold (either pursuant to a Registration Statement or otherwise) by the Holder, or (ii) the time as all of the remaining Registrable Securities are eligible to be sold by the Holder without compliance with the volume limitations or public information requirements of Rule 144.

 

“Holder” means the Purchaser so long as the Purchaser holds Registrable Securities.

 

“Registrable Securities” means (i) Series B-1 Conversion Shares and (ii) any securities issued or issuable upon any stock split, dividend or other distribution, recapitalization 

 

4

 

or similar event, or any price adjustment as a result of such stock splits, reverse stock splits or similar events with respect to the Series B-1 Conversion Shares.

 

“Securities Market Value” means, with respect to any Registrable Security, the volume-weighted average price of the Registrable Security for the five (5) days immediately prior to the date in question.

 

“Registration Statement Effective Date” means the date on which the Registration Statement is first declared effective by the Commission.

 

4.                                      Representations and Warranties of Company.  The Company hereby makes to the Purchaser the following representations and warranties as of the date hereof and each Issue Date:

 

(a)                                 Organization and Qualification.  The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization (as applicable), with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted.  Neither the Company nor any Subsidiary is in violation or default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational or charter documents.  Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity or enforceability of this Agreement, (ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis its obligations under this Agreement (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.

 

(b)                                 Authorization; Enforcement.  The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder and thereunder.  The execution and delivery of this Agreement by the Company and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, its board of directors or its stockholders in connection therewith.  This Agreement has been duly executed by the Company and, when delivered in accordance with the terms hereof will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.

 

(c)                                  No Conflicts.  The execution, delivery and performance of this Agreement 

 

5

 

by the Company and the consummation by the Company of the transactions contemplated hereby do not and will not: (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would  become a default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any material agreement, credit facility, debt or other material instrument (evidencing a Company or Subsidiary debt or otherwise) or other material understanding to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii), such as could not have or reasonably be expected to result in a Material Adverse Effect.

 

(d)                                 Issuance of the Securities.  The Purchaser B-1 Preferred Stock is duly authorized and, when issued in accordance with this Agreement, will be duly and validly issued, fully paid and nonassessable, free and clear of all liens imposed by the Company.  The Series B-1 Conversion Shares, when issued upon conversion of the Series B-1 Conversion Shares, will be validly issued, fully paid and nonassessable, free and clear of all liens imposed by the Company.  The Company has reserved from its duly authorized capital stock a sufficient number of shares of Common Stock for issuance of all of the Series B-1 Preferred Stock and Series B-1 Conversion Shares.

 

5.                                      Representations and Warranties of the Purchaser.  The Purchaser hereby represents and warrants as of the date hereof and on each Issue Date to the Company as follows (unless as of a specific date therein):

 

(a)                                 Organization; Authority.  The Purchaser is an entity duly incorporated or formed, validly existing and in good standing under the laws of the jurisdiction of its incorporated or formed with full right, corporate, partnership, limited liability company or similar power and authority to enter into and to consummate the transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement and performance by the Purchaser of the transactions contemplated herein have been duly authorized by all necessary corporate, partnership, limited liability company or similar action, as applicable, on the part of the Purchaser.  This Agreement has been duly executed by the Purchaser, and when delivered by the Purchaser in accordance with the terms hereof, will constitute the valid and legally binding obligation of the Purchaser, enforceable against it in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.

 

(b)                                 Authorization; Enforcement.  The Purchaser has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this 

 

6

 

Agreement and otherwise to carry out its obligations hereunder and thereunder.  The execution and delivery of this Agreement by the Purchaser and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary action on the part of the Purchaser and no further action is required by the Purchaser, its board of directors or its stockholders in  connection therewith.  This Agreement has been duly executed by the Purchaser and, when delivered in accordance with the terms hereof will constitute the valid and binding obligation of the Purchaser enforceable against the Purchaser in accordance with its terms except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.

 

(c)                                  Investment Entirely for Own Account.  This Agreement is made with the Purchaser in reliance upon the Purchaser’s representation to the Company, which by the Purchaser’s execution of this Agreement, the Purchaser hereby confirms, that the Series B-1 Preferred Shares will be acquired for investment for the Purchaser’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Purchaser has no present intention of selling, granting any participation in, or otherwise distributing the same. By executing this Agreement, the Purchaser further represents that the Purchaser does not presently have any contract, undertaking, agreement or arrangement with any Person to sell, transfer or grant participations to such Person or to any third Person, with respect to any of the Series B-1 Preferred Shares. The Purchaser has not been formed for the specific purpose of acquiring the Series B-1 Preferred Shares.

 

(d)                                 Access to Information.  The Purchaser acknowledges that it has had the opportunity to review this Agreement (including all exhibits and schedules thereto) and the Company’s reports, schedules, forms statements and other documents filed by the Company under the Securities Act and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including pursuant to Section 13(a) or 15(d) thereof, and has been afforded (i) the opportunity to ask such questions as it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of the offering of the Series B-1 Preferred Shares and the merits and risks of investing in the Series B-1 Preferred Shares; (ii) access to information about the Company and its financial condition, results of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment.

 

(e)                                  Restricted Securities.  The Purchaser understands that the Series B-1 Preferred Shares have not been registered under the Securities Act. The Purchaser understands that, until such time as the Series B-1 Preferred Shares have been registered pursuant to the provisions of the Securities Act, or the Series B-1 Preferred Shares are eligible for resale pursuant to Rule 144 promulgated under the Securities Act without any restriction as to the number of securities as of a particular date that can then be immediately sold, the Series B-1 Preferred Shares are “restricted securities” under applicable U.S. federal and state securities laws and that, pursuant to these laws, the Purchaser must hold the Series B-1 Preferred Shares indefinitely unless they are registered with the Commission and qualified by state authorities, or 

 

7

 

an exemption from such registration and qualification requirements is available. The Purchaser acknowledges that the Company has no obligation to register or qualify any of the Series B-1 Preferred Shares or Series B-1 Conversion Shares except as set forth in this Agreement. The Purchaser further acknowledges that if an exemption from registration or qualification is available, it may be conditioned on various  requirements including, but not limited to, the time and manner of sale, the holding period for the Series B-1 Preferred Shares, and on requirements relating to the Company which are outside of the Purchaser’s control, and which the Company is under no obligation and may not be able to satisfy.

 

(f)                                   No Public Market.  The Purchaser understands that no public market now exists for the Series B-1 Preferred Shares, and that the Company has made no assurances that a public market will ever exist for the Series B-1 Preferred Shares.

 

(g)                                  Legends.  The Purchaser understands that, until such time as the Series B-1 Preferred Shares and any securities issued in respect of or exchange for the Series B-1 Preferred Shares have been registered pursuant to the provisions of the Securities Act, or such securities are eligible for resale pursuant to Rule 144 promulgated under the Securities Act without any restriction as to the number of securities as of a particular date that can then be immediately sold, the Series B-1 Preferred Shares and any securities issued in respect of or exchange for the Series B-1 Preferred Shares shall be notated with one or all of the following restrictive legends:

 

“THIS SECURITY HAS NOT BEEN REGISTERED WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE LAWS.”

 

(i)   Any legend set forth in, or required by, the Series B-1 Certificate of Designation.

 

(ii)  Any legend required by the securities laws of any state to the extent such laws are applicable to the Series B-1 Preferred Shares represented by the certificate, instrument, or book entry so legended.

 

(g)                                  Accredited Investor.  The Purchaser is an accredited investor as defined in Rule 501(a) of Regulation D promulgated under the Securities Act.

 

(h)                                 Residence.  The office or offices of the Purchaser in which its principal place of business is identified in the address or addresses of the Purchaser set forth on signature page hereto.

 

8

 

(j)        Bad Actor.  Neither the Purchaser nor any person or entity with whom the Purchaser will share beneficial ownership of the Securities, is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act.

 

6.                                      Securities Law Disclosure.  On or before 9 am ET on the Trading Day following the date hereof, the Company shall file a Current Report on Form 8-K disclosing the terms of the transactions contemplated hereby, including this Agreement as an exhibit thereto.

 

7.                                      Except as specifically provided herein, the terms and conditions of the Purchaser Series 1 Warrants shall remain in full force and effect and the rights and obligations of the parties thereunder shall, except as specifically provided herein, be unaffected by this Agreement and shall continue as provided in such documents and shall not be in any way changed, modified or superseded by the terms set forth herein.  This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement.

 

[signature pages follow]

 

9

 

IN WITNESS WHEREOF, this agreement is executed as of the date first set forth above.

 

	
 
    	
JAGUAR   HEALTH, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Lisa A. Conte
    
	
 
    	
Name:
    	
Lisa   A. Conte
    
	
 
    	
Title:
    	
President   and CEO
    

 

10

 

IN WITNESS WHEREOF, this agreement is executed as of the date first set forth above.

 

	
 
    	
PURCHASER:
    
	
 
    	
 
    
	
 
    	
Name:
    	
IONIC   VENTURES, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Brendan O’Neil
    
	
 
    	
Name:
    	
Brendan   O’Neil
    
	
 
    	
Title:
    	
Partner
    
	
 
    	
 
    
	
 
    	
Address   for Notice:
    
	
 
    	
 
    
	
 
    	
Ionic   Ventures, LLC
    
	
 
    	
5328   Yacht Haven Grande, Box # 15 / Suite C201
    
	
 
    	
St.   Thomas, VI 00802
    
	
 
    	
 
    
	
 
    	
Purchaser   Series B Preferred Shares: 1,971
    
	
 
    	
 
    
	
 
    	
Purchaser   Series 1 Warrants: 1,250,000
    
				

 

11

 

Exhibit A

 

Form of Series B-1 Certificate of Designation

 

12

 

Exhibit B

 

Form of Put Notice

 

TO: IONIC VENTURES, LLC

DATE:                                                           

 

We refer to the warrant exercise agreement, dated October 2, 2019 (the “Agreement”), entered into by and between Jaguar Health, Inc. and you. Capitalized terms defined in the Agreement shall, unless otherwise defined herein, have the same meaning when used herein.

 

We hereby:

 

1)             Give you notice that we require you to deliver an executed Notice of Exercise covering          Series 1 Warrant Shares;

 

2)             Advise that the Put Date for this Put, is                          ; and

 

3)             Advise that we will issue you a certificate representing           shares of Series B-1 Preferred Stock within two Trading Days of the Put Date.

 

	
 
    	
JAGUAR   HEALTH, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    

 

13

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