Document:

Exhibit
4.4

 

WARRANT
AGENT AGREEMENT

 

This
Warrant Agent Agreement (this "Agreement") is made effective as of February 2, 2015, by and between Zion
Oil & Gas, Inc., a Delaware corporation having its principal place of business at 6510 Abrams Road, Suite 300, Dallas, Texas
75231 (the "Company"), and American Stock Transfer & Trust Company, LLC, a New York limited liability
trust company with offices at 6201 15th Avenue, Brooklyn, NY 11219 (“AST") and is an amendment to
the Warrant Agreement dated August 1, 2014 between the Company and AST by the expansion of the Unit option program. 

 

WHEREAS,
the Company has implemented a Dividend Reinvestment and Common Stock Purchase Plan (hereinafter “DSPP”)
and AST is administering the DSPP as the Plan agent (the “Plan Agent”) and Warrant agent (the “Warrant
Agent”), effective August 1, 2014, under a Warrant Agreement dated August 1, 2014 that is still in effect for the
$2.50 Unit option program and as the continuation of AST as the Warrant Agent under the DSPP for the Warrant ZNWAA;

 

WHEREAS,
pursuant to the DSPP, the Company is offering a new unit option program consisting of a new Unit (each a “Unit”
and collectively the “Units”) of its securities to existing stockholders and investors, with each Unit
consisting of one (1) share of the Company’s Common Stock, par value $0.01 per share (the “Common Stock”),
and three (3) Common Stock purchase warrants. Each warrant affords the investor the opportunity to purchase one share of our Common
Stock at an exercise price of $1.00 per share (each “Warrant” and collectively the “Warrants”),
but with different maturity dates; Each Unit may be purchased currently at a per Unit price of $4.00;

 

WHEREAS,
the new Warrants will be exercisable beginning on June 5, 2015 and continue to be exercisable through June 6, 2016 for Warrant
ZNWAB (1 year), June 5, 2017 for Warrant ZNWAC (2 years) and June 4, 2018 for Warrant ZNWAD (3 years), respectively, at a per
share exercise price of $1.00 for each of the three Warrants;

 

WHEREAS,
the Company is utilizing the Registration Statement on Form S-3 (Registration No. 333-193336), as amended, which was declared
effective by the SEC on March 27, 2014 (the “Registration Statement”) and Amendment No. 3 filed January
13, 2015 to facilitate the trading of the shares of Common Stock included in the new Units and the shares of Common Stock underlying
the Warrants that are included in the Units as well as the Warrants;

 

WHEREAS,
the shares of Common Stock included in the Units are tradable on the NASDAQ under the symbol ZN and, following the closing of
the Unit program, the shares of Common Stock underlying the Warrants, will be tradable after Warrant exercise on the NASDAQ under
the symbol ZN; the Company has filed an application to list each of the three Warrants on the NASDAQ, but the Units will not be
listed for trading nor will they otherwise be tradable;

 

WHEREAS,
the Company desires AST to act on behalf of the Company, and AST is willing to so act, in connection with the issuance, registration,
transfer, exchange, redemption and exercise of the three Warrants (in such capacity, the “Warrant Agent”)
herein described;

 

    	 

    	 

    

 

WHEREAS,
the Company desires to provide for the form and provisions of the Warrants, the terms upon which they shall be issued and exercised,
and the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants;
and

 

WHEREAS,
all acts and things have been done and performed which are necessary to make the Warrants, when executed on behalf of the Company
and countersigned by or on behalf of the Warrant Agent, as provided herein, the valid, binding and legal obligations of the Company,
and to authorize the execution and delivery of this Agreement.

 

NOW,
THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows:

 

1.  
Appointment of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company for the three
Warrants herein described, and the Warrant Agent hereby accepts such appointment and agrees to perform the same in accordance
with the terms and conditions set forth in this Agreement.

   

2.  
New Warrants.

 

2.1  
Form of Warrant. Each Warrant shall be issued in registered form or held in book entry form by AST as Warrant Agent. The
Warrants shall be in substantially the form of Exhibit A hereto, the provisions of which are incorporated herein,
and shall be signed by, or bear the facsimile signature of, the Executive Chairman and Secretary/Treasurer of the Company and
shall bear a facsimile of the Company's seal. In the event the person whose facsimile signature has been placed upon any Warrant
shall have ceased to serve in the capacity in which such person signed the Warrant before such Warrant is issued, it may be issued
with the same effect as if he or she had not ceased to be such at the date of issuance.

 

2.2  
Effect of Countersignature. Unless and until countersigned by the Warrant Agent pursuant to this Agreement, a Warrant shall
be invalid and of no effect and may not be exercised by the holder thereof, unless acknowledged and held in book entry form by
the Warrant Agent.

 

2.3  
Registration.

 

2.3.1  
Warrant Register. The Warrant Agent shall maintain books ("Warrant Register" or also referred to
as “book entry form”) for the registration of original issuance and the registration of transfer of
the three Warrants, if the Warrants are not held in book entry form by Warrant Agent. Upon the initial issuance of the Warrants
unless held in book entry form by the Warrant Agent, the Warrant Agent shall issue and register the Warrants in the names of the
respective holders thereof in such denominations and otherwise in accordance with instructions delivered to the Warrant Agent
by the Company.

 

2.3.2  
Registered Holder. Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant Agent
may deem and treat the person in whose name such Warrant shall be registered upon the Warrant Register ("registered
holder"), as the absolute owner of such Warrant and of each Warrant represented thereby (notwithstanding any notation
of ownership or other writing on the Warrant Certificate made by anyone other than the Company or the Warrant Agent), for the
purpose of any exercise thereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by
any notice to the contrary.

 

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3.  
Terms and Exercise of Warrants.

 

3.1  
Warrant Price. Each Warrant shall, when countersigned by the Warrant Agent, entitle the registered holder thereof, subject
to the provisions of such Warrant and this Warrant Agreement, to purchase from the Company the number of shares of Common Stock
stated therein, at the price of $1.00 per share, subject to the adjustments provided in this Section 3.1 and Section 4 hereof.
The term "Warrant Price" as used in this Warrant Agreement refers to the price per share at which Common Stock may be
purchased at the time a Warrant is exercised. The Company in its sole discretion may lower the Warrant Price at any time prior
to the Expiration Date for a period of not less than ten business days, provided that any such reduction shall be identical among
all of the Warrants.

 

3.2  
Duration of Warrants. A Warrant may be exercised only during the period commencing on June 5, 2015 and terminating at 5:00
p.m., Eastern Standard Time on the first year, second year and third year anniversary thereof with respect to Warrants ZNWAB,
ZNWAC and ZNWAD, respectively. Notwithstanding the foregoing, no Warrant shall be exercisable unless, at the time of exercise,
a registration statement relating to the Common Stock issuable upon the exercise of such Warrant is effective and current and
a prospectus is available for use by the holders thereof and the Common Stock has been qualified or deemed to be exempt under
the securities laws of the state of residence of the holder of such Warrants. The period during which a Warrant may be exercised
shall be deemed the "Exercise Period" and the termination of such Exercise Period shall be deemed the
"Expiration Date." Each Warrant not exercised on or before the Expiration Date shall become void, and
all rights thereunder and all rights in respect thereof under this Agreement shall cease at the close of business on the Expiration
Date. The Company in its sole discretion may extend the duration of the Warrants by delaying the Expiration Date; provided, however,
the Company will provide notice to registered holders of the Warrants of such extension of not less than 20 days and, further
provided that any such extension shall be identical in duration among all of the Warrants.

  

3.3  
Exercise of Warrants.

 

3.3.1  
Payment. Subject to the provisions of the Warrants and this Warrant Agreement, a Warrant, when countersigned by the Warrant
Agent, may be exercised by the registered holder thereof by surrendering it at the office of the Warrant Agent, or at the office
of its successor as Warrant Agent, in Brooklyn, New York, with the subscription form, as set forth in the Warrant, or exercised
by other electronic means acceptable to the Company, duly executed by paying in full, by bank check, bank wire, other electronic
bank payment method, or other legal currency means of payment acceptable by the Company and payable to the order of the Company,
the Warrant Price for each full share of Common Stock as to which the Warrant is exercised and any and all applicable taxes due
in connection with the exercise of the Warrant, the exchange of the Warrant for the Common Stock and the issuance of the Common
Stock.

 

3.3.2  
Issuance of Certificates. As soon as practicable after the exercise of any Warrant and the clearance of the funds in payment
of the Warrant Price, the Company shall issue to the registered holder of such Warrant a certificate or certificates for the number
of full shares of Common Stock to which he, she or it is entitled, registered in such name or names as may be directed by him,
her or it, and if such Warrant shall not have been exercised in full, a new countersigned Warrant for the number of shares as
to which such Warrant shall not have been exercised, unless the Common Stock is to be held in book entry form by AST without the
issuance of a certificate and any remaining balance of Warrants to be maintained in book entry form by the Warrant Agent. Notwithstanding
the foregoing, the Company shall not be obligated to deliver or to recognized in book entry form any securities pursuant to the
exercise of a Warrant unless (i) a registration statement under the Act with respect to the Common Stock issuable upon such exercise
is effective, or (ii) in the opinion of counsel to the Company, the exercise of the Warrants is exempt from the registration requirements
of the Act and such securities are qualified for sale or exempt from qualification under applicable securities laws of the states
or other jurisdictions in which the registered holders reside. Warrants may not be exercised by, or securities issued to, any
registered holder in any state in which such exercise or issuance would be unlawful. In no event will the Company be required
to provide the registered holder of a warrant with a net-cash settlement or other consideration in lieu of physical settlement
in shares of Common Stock, regardless of whether the Common Stock underlying the Warrants is registered pursuant to an effective
registration statement.

 

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3.3.3  
Valid Issuance. All shares of Common Stock issued upon the proper exercise of a Warrant in conformity with this Agreement
shall be validly issued, fully paid and nonassessable.

 

3.3.4  
Date of Issuance. Each person in whose name any such certificate for shares of Common Stock is issued shall for all purposes
be deemed to have become the holder of record of such shares on the date on which the Warrant was surrendered and payment of the
Warrant Price was made, irrespective of the date of delivery of such certificate, except that, if the date of such surrender and
payment is a date when the stock transfer books of the Company are closed, such person shall be deemed to have become the holder
of such shares at the close of business on the next succeeding date on which the stock transfer books are open.

 

4.  
Adjustments.

 

4.1  
Stock Dividends Split Ups. If after the date hereof, and subject to the provisions of Section 4.6 below, the number of
outstanding shares of Common Stock is increased by a stock dividend payable in shares of Common Stock, or by a split up of shares
of Common Stock, or other similar event, then, on the effective date of such stock dividend, split up or similar event, the number
of shares of Common Stock issuable on exercise of each Warrant shall be increased in proportion to such increase in outstanding
shares of Common Stock. For purposes of clarification, no adjustment shall be made in the event of a rights offering or similar
transaction.

 

4.2  
Aggregation of Shares. If after the date hereof, and subject to the provisions of Section 4.6, the number of outstanding
shares of Common Stock is decreased by a consolidation, combination, reverse stock split or reclassification of shares of Common
Stock or other similar event, then, on the effective date of such consolidation, combination, reverse stock split, reclassification
or similar event, the number of shares of Common Stock issuable on exercise of each Warrant shall be decreased in proportion to
such decrease in outstanding shares of Common Stock.

 
 

4.3  
Adjustments in Exercise Price. Whenever the number of shares of Common Stock purchasable upon the exercise of the Warrants
is adjusted, as provided in Section 4.1 and 4.2 above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying
such Warrant Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of shares
of Common Stock purchasable upon the exercise of the Warrants immediately prior to such adjustment, and (y) the denominator of
which shall be the number of shares of Common Stock so purchasable immediately thereafter.

 

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4.4
  Replacement of Securities upon Reorganization, etc. In case of any reclassification or reorganization of the outstanding
shares of Common Stock (other than a change covered by Section 4.1 or 4.2 hereof or that solely affects the par value of such
shares of Common Stock), or in the case of any merger or consolidation of the Company with or into another corporation (other
than a consolidation or merger in which the Company is the continuing corporation and that does not result in any reclassification
or reorganization of the outstanding shares of Common Stock), or in the case of any sale or conveyance to another corporation
or entity of the assets or other property of the Company as an entirety or substantially as an entirety in connection with which
the Company is dissolved, the Warrant holders shall thereafter have the right to purchase and receive, upon the basis and upon
the terms and conditions specified in the Warrants and in lieu of the shares of Common Stock of the Company immediately theretofore
purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of shares of stock or other
securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon
a dissolution following any such sale or transfer, that the Warrant holder would have received if such Warrant holder had exercised
his, her or its Warrant(s) immediately prior to such event; and if any reclassification also results in a change in shares of
Common Stock covered by Section 4.1 or 4.2, then such adjustment shall be made pursuant to Sections 4.1, 4.2, 4.3 and this
Section 4.4. The provisions of this Section 4.4 shall similarly apply to successive reclassifications, reorganizations, mergers
or consolidations, sales or other transfers.

 

4.5  
Notices of Changes in Warrant. Upon every adjustment of the Warrant Price or the number of shares issuable on exercise
of a Warrant, the Company shall give written notice thereof to the Warrant Agent, which notice shall state the Warrant Price resulting
from such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise
of a Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based.
Upon the occurrence of any event specified in Sections 4.1, 4.2, 4.3 or 4.4, then, in any such event, the Company shall give written
notice to the Warrant holder, at the last address set forth for such holder in the Warrant Register, of the record date or the
effective date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of
such event.

 

4.6  
No Fractional Shares. Notwithstanding any provision contained in this Warrant Agreement to the contrary, the Company shall
not issue fractional shares upon exercise of Warrants. If, by reason of any adjustment made pursuant to this Section 4, the holder
of any Warrant would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the Company
shall, upon such exercise, round up to the nearest whole number the number of the shares of Common Stock to be issued to the Warrant
holder.

 

4.7  
Form of Warrant. The form of Warrant need not be changed because of any adjustment pursuant to this Section 4, and Warrants
issued after such adjustment may state the same Warrant Price and the same number of shares as is stated in the Warrants initially
issued pursuant to this Agreement. However, the Company may at any time in its sole discretion make any change in the form of
Warrant that the Company may deem appropriate and that does not affect the substance thereof, and any Warrant thereafter issued
or countersigned, whether in exchange or substitution for an outstanding Warrant or otherwise, may be in the form as so changed.

 
 

5.  
Transfer and Exchange of Warrants.

 

5.1  
Registration of Transfer. The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant
upon the Warrant Register, upon surrender of such Warrant for transfer, properly endorsed with signatures properly guaranteed
and accompanied by appropriate instructions for transfer. Upon any such transfer, a new Warrant representing an equal aggregate
number of Warrants shall be issued and the old Warrant shall be cancelled by the Warrant Agent. The Warrants so cancelled shall
be delivered by the Warrant Agent to the Company from time to time upon request.

 

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5.2  
Procedure for Surrender of Warrants. Warrants may be surrendered to the Warrant Agent, together with a written request
for exchange, and thereupon the Warrant Agent shall issue in exchange therefor one or more new Warrants as requested by the registered
holder of the Warrants so surrendered, representing an equal aggregate number of Warrants; provided, however, in the event a Warrant
surrendered for transfer bears a restrictive legend, the Warrant Agent shall not cancel such Warrant and issue new Warrants in
exchange therefor until the Warrant Agent has received an opinion of counsel for the Company stating such transfer may be made
and indicating whether the new Warrants must also bear a restrictive legend.

 

5.3  
Fractional Warrants. The Warrant Agent shall not be required to effect any registration of transfer or exchange which will
result in the issuance of a warrant certificate for a fraction of a warrant.

 

5.4  
Service Charges. No service charge shall be made for any exchange or registration of transfer of Warrants.

 

5.5  
Warrant Execution and Countersignature. The Warrant Agent is hereby authorized to countersign and deliver, in accordance
with the terms of this Agreement, the Warrants required to be issued pursuant to the provisions of this Section 5, and the Company,
whenever required by the Warrant Agent, will supply the Warrant Agent with Warrants duly executed on behalf of the Company for
such purpose.

 

6.  
Other Provisions Relating to Rights of Holders of Warrants.

 

6.1  
No Rights as Stockholder. A Warrant does not entitle the registered holder thereof to any of the rights of a stockholder
of the Company, including, without limitation, the right to receive dividends, or other distributions, exercise any preemptive
rights to vote or to consent or to receive notice as stockholders in respect of the meetings of stockholders or the election of
directors of the Company or any other matter.

 

6.2  
Lost, Stolen, Mutilated, or Destroyed Warrants. If any Warrant is lost, stolen, mutilated, or destroyed, the Company and
the Warrant Agent may on such terms as to indemnity or otherwise as they may in their discretion impose (which shall, in the case
of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination, tenor, and date as the Warrant
so lost, stolen, mutilated, or destroyed. Any such new Warrant shall constitute a substitute contractual obligation of the Company,
whether or not the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time enforceable by anyone.

 

6.3  
Reservation of Common Stock. The Company shall at all times reserve and keep available a number of its authorized but unissued
shares of Common Stock that will be sufficient to permit the exercise in full of all outstanding Warrants issued pursuant to this
Warrant Agreement.

 
 

7.  
Concerning the Warrant Agent and Other Matters.

 

7.1  
Payment of Taxes. The Company will from time to time promptly pay all taxes and charges that may be imposed upon the Company
or the Warrant Agent in respect of the issuance or delivery of shares of Common Stock upon the exercise of Warrants, but the Company
shall not be obligated to pay any transfer taxes in respect of the Warrants or such shares.

 

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7.2  
Resignation, Consolidation, or Merger of Warrant Agent.

 

7.2.1  
Appointment of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties
and be discharged from all further duties and liabilities hereunder after giving sixty (60) days' notice in writing to the Company.
If the office of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint
in writing a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within
a period of 30 days after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the holder
of the Warrant (who shall, with such notice, submit his Warrant for inspection by the Company), then the holder of any Warrant
may apply to a court of competent jurisdiction for the appointment of a successor Warrant Agent. Any successor Warrant Agent,
whether appointed by the Company or by such court, shall be authorized to exercise corporate trust powers and subject to supervision
or examination by federal or state authority. After appointment, any successor Warrant Agent shall be vested with all the authority,
powers, rights, immunities, duties, and obligations of its predecessor Warrant Agent with like effect as if originally named as
Warrant Agent hereunder, without any further act or deed; but if for any reason it becomes necessary or appropriate, the predecessor
Warrant Agent shall execute and deliver, at the expense of the Company, an instrument transferring to such successor Warrant Agent
all the authority, powers, and rights of such predecessor Warrant Agent hereunder; and upon request of any successor Warrant Agent
the Company shall make, execute, acknowledge, and deliver any and all instruments in writing for more fully and effectually vesting
in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities, duties, and obligations.

 

7.2.2
  Notice of Successor Warrant Agent. In the event a successor Warrant Agent shall be appointed, the Company shall
give notice thereof to the predecessor Warrant Agent and the transfer agent for the Common Stock not later than the effective
date of any such appointment.

 

7.2.3  
Merger or Consolidation of Warrant Agent. Any corporation into which the Warrant Agent may be merged or with which it may
be consolidated or any corporation resulting from any merger or consolidation to which the Warrant Agent shall be a party shall
be the successor Warrant Agent under this Warrant Agreement without any further act.

 

7.3  
Fees and Expenses of Warrant Agent.

 

7.3.1  
Remuneration. The Company agrees to pay the Warrant Agent reasonable remuneration for its services as such Warrant Agent
hereunder as set forth on Exhibit B hereto, and will reimburse the Warrant Agent upon demand for all expenditures
that the Warrant Agent may reasonably incur in the execution of its duties hereunder.

 

7.3.2  
Further Assurances. The Company agrees to perform, execute, acknowledge, and deliver or cause to be performed, executed,
acknowledged, and delivered all such further and other acts, instruments, and assurances as may reasonably be required by the
Warrant Agent for the carrying out or performing of the provisions of this Warrant Agreement.

 

7.4  
Liability of Warrant Agent.

 

7.4.1  
Reliance on Company Statement. Whenever in the performance of its duties under this Warrant Agreement, the Warrant Agent
shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking or suffering
any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be
deemed to be conclusively proved and established by a statement signed by the Chief Executive Officer, President, Chief Operating
Officer, Chief Financial Officer, Executive Vice President, Secretary or Assistant Secretary of the Company and delivered to the
Warrant Agent. The Warrant Agent may rely upon such statement for any action taken or suffered in good faith by it pursuant to
the provisions of this Warrant Agreement.

 

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7.4.2  
Indemnity. The Warrant Agent shall be liable hereunder only for its own gross negligence, willful misconduct or bad faith.
The Company agrees to indemnify the Warrant Agent and save it harmless against any and all liabilities, including judgments, costs
and reasonable counsel fees, for anything done or omitted by the Warrant Agent in the execution of this Warrant Agreement except
as a result of the Warrant Agent's gross negligence, willful misconduct, or bad faith.

 

7.4.3  
Exclusions. The Warrant Agent shall have no responsibility with respect to the validity of this Warrant Agreement or with
respect to the validity or execution of any Warrant (except its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this Warrant Agreement or in any Warrant; nor shall it be responsible
to make any adjustments required under the provisions of Section 4 hereof or responsible for the manner, method, or amount of
any such adjustment or the ascertaining of the existence of facts that would require any such adjustment; nor shall it by any
act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any shares of Common
Stock to be issued pursuant to this Warrant Agreement or any Warrant or as to whether any shares of Common Stock will when issued
be valid and fully paid and nonassessable.

  

7.5  
Acceptance of Agency. The Warrant Agent hereby accepts the agency established by this Warrant Agreement and agrees to perform
the same upon the terms and conditions herein set forth and among other things, shall account promptly to the Company with respect
to Warrants exercised and concurrently account for, and pay to the Company, all moneys received by the Warrant Agent for the purchase
of shares of the Company's Common Stock through the exercise of Warrants.

 

7.6  
Waiver. The Warrant Agent hereby waives any and all right, title, interest or claim of any kind ("Claim")
in or to any distribution of any account in which funds related to the purchase or exercise of the Warrants are held, and hereby
agrees not to seek recourse, reimbursement, payment or satisfaction for any Claim against any such account for any reason whatsoever.

 

8.  
Miscellaneous Provisions.

 

8.1  
Successors. All the covenants and provisions of this Warrant Agreement by or for the benefit of the Company or the Warrant
Agent shall bind and inure to the benefit of their respective successors and assigns.

 

8.2  
Notices. Any notice or other communication required or which may be given hereunder shall be in writing and either be delivered
personally or by private national courier service, or be mailed, certified or registered mail, return receipt requested, postage
prepaid, and shall be deemed given when so delivered personally or, if sent by private national courier service, on the next business
day after delivery to the courier, or, if mailed, two business days after the date of mailing, as follows:

 

Zion Oil
& Gas, Inc.

6510 Abrams
Road, Suite 300

Dallas,
Texas 75231

Attn:  Chief
Executive Officer

 

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Any
notice, statement or demand authorized by this Warrant Agreement to be given or made by the holder of any Warrant or by the Company
to or on the Warrant Agent shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified
mail or private courier service five days after deposit of such notice, postage prepaid, addressed (until another address is filed
in writing by the Warrant Agent with the Company), as follows:

 
 

American
Stock Transfer & Trust Company, LLC

6201 15th
Avenue

Brooklyn,
New York 11219

Attn: Account
Executive

 

8.3  
Applicable Law. The validity, interpretation, and performance of this Warrant Agreement and of the Warrants shall be governed
in all respects by the laws of the State of New York, without giving effect to conflict of laws. Each party hereby agrees that
any action, proceeding or claim against it arising out of or relating in any way to this Warrant Agreement shall be brought and
enforced in the appropriate state or federal courts in the State of New York, and irrevocably submits to such jurisdiction, which
jurisdiction shall be exclusive. Each party hereby waives any objection to such exclusive jurisdiction and that such courts represent
an inconvenient forum.

 

8.4  
Persons Having Rights under this Warrant Agreement. Nothing in this Warrant Agreement expressed and nothing that may be
implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or give to, any person or corporation
other than the parties hereto and the registered holders of the Warrants, any right, remedy, or claim under or by reason of this
Warrant Agreement or of any covenant, condition, stipulation, promise, or agreement hereof. All covenants, conditions, stipulations,
promises, and agreements contained in this Warrant Agreement shall be for the sole and exclusive benefit of the parties hereto
and their successors and assigns and of the registered holders of the Warrants. 

 

8.5
  Examination of the Warrant Agreement. A copy of this Warrant Agreement shall be available at all reasonable times
at the office of the Warrant Agent for inspection by the registered holder of any Warrant. The Warrant Agent may require any such
holder to submit his Warrant for inspection by it.

 

8.6  
Counterparts. This Warrant Agreement may be executed in any number of counterparts and each of such counterparts shall
for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

 

8.7  
Effect of Headings. The Section headings herein are for convenience only and are not part of this Warrant Agreement and
shall not affect the interpretation thereof.

 

8.8  
Amendments. This Warrant Agreement may be amended by the parties hereto without the consent of any registered holder for
the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained herein or adding
or changing any other provisions with respect to matters or questions arising under this Warrant Agreement as the parties may
deem necessary or desirable and that the parties deem shall not adversely affect the interest of the registered holders. All other
modifications or amendments, including any amendment to increase the Warrant Price or shorten the Exercise Period, shall require
the written consent of a majority of the then outstanding Warrants. Notwithstanding the foregoing, the Company may lower the Warrant
Price or extend the duration of the Exercise Period in accordance with Sections 3.1 and 3.2, respectively, without such consent.

 

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8.9  
Severability. This Warrant Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision
hereof shall not affect the validity or enforceability of this Warrant Agreement or of any other term or provision hereof. Furthermore,
in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part
of this Warrant Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be
valid and enforceable.

 

IN WITNESS
WHEREOF, this Warrant Agreement has been duly executed by the parties hereto effective as of the day and year first above written.

 

	ZION
    OIL & GAS, INC.
	 
	By:	/s/
    John M. Brown	 
	 
	Name:
    John M. Brown
	Title:  Chief
    Executive Officer
	 

        Date:
February 5, 2015 

         

	AMERICAN
    STOCK TRANSFER & TRUST COMPANY, LLC
	 
	By:	/s/
    Michael A. Nespoli	 
	 
	Name:
    Michael A. Nespoli
	Title:  Executive
    Director

 

Date:
February 6, 2015

 

 

10EX-10.1

 Exhibit 10.1 

CONFIDENTIAL 
 EMPLOYMENT
AGREEMENT 
 This Employment Agreement (“Agreement”) is made as of February 5, 2015, by and between Monarch Bank, a
Virginia banking company (the “Company”), and William T. Morrison (the “Officer”). 
 The parties, intending to be
legally bound, agree as follows: 
 1. Employment and Acceptance. The Officer shall be employed and have the title
“Monarch Mortgage CEO” The Officer shall have duties, title, and responsibilities as may be reasonably assigned to him or modified from time to time by the Company. The Officer hereby accepts and agrees to such employment and agrees to
carry out his duties and responsibilities to the best of his ability in a competent, efficient and businesslike manner. During the term of this Agreement, the Officer: (i) shall devote his attention, skill, and efforts full-time to the faithful
performance of his duties hereunder; provided, however, that from time to time with the prior approval of the Company, the Officer may serve on the boards of directors of, and hold any other offices or positions in, non-profit organizations which
will not present any conflict of interest with the Company, unfavorably affect the performance of Officer’s duties pursuant to this Agreement or violate any applicable statute or regulation; and (ii) shall not engage in any business or
activity competitive with or antagonistic toward the business interests of the Company. 
 2. Term of Employment. This
Agreement is effective as of the original agreement date (the “Commencement Date”) and will expire on December 31, 2016, unless sooner terminated as provided herein (the “Employment Period”). The last day of the Employment
Period is sometimes referred to as the “Expiration Date.” The term of this agreement shall automatically extend for an additional 24-month period beginning on the day after the Expiration Date, and on each Expiration Date thereafter,
provided that the term shall not so extend if the Company provides written notice to the Officer at least 12 months prior to the Expiration Date indicating the Company’s desire not to extend the term of the agreement. The parties expressly
agree that the provisions of Section 5 hereof will continue in effect following the expiration of the Agreement, or any extensions thereof. 

3. Compensation and Benefits. 

(a) Base Salary. The Company shall pay the Officer an annual base salary (the “Base Salary”), which will be payable in
accordance with the payroll practices of the Company applicable to all officers. The Base Salary will be that salary in effect as of the original agreement date or within six months of the date of this agreement, whichever is higher, and continue at
a minimum of that amount for the term of this employment agreement. 
 (b) Benefits. The Officer will be entitled to participate in
and receive the benefits of any retirement benefit plan, life insurance, profit sharing, employee stock ownership, and other plans, benefits and privileges of the Company that may be in effect from time to time, to the extent the Officer is eligible
under the terms of those plans and programs. A formal profit sharing plan for Officer will be detailed in Appendix A, if applicable. 
 (c)
Incentive Compensation Clawback and Repayment. Any incentive compensation the Officer receives, to be established by individual or group bonus programs from time to time, or through this agreement, may be required to be repaid under the
Company’s clawback provisions. If the 

  
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Company is required to restate its financial statements because of material noncompliance with any financial reporting requirement under securities laws, the Company is required to recover from
any current or former executive officer who received incentive-based compensation, including restricted stock, during the three year period preceding the date on which the restatement is required, any amount in excess of the amounts that would have
been paid to the Officer under the Company’s restated financial statements. The excess portion of the incentive payout is defined as the difference between the actual payout under the original financials and the amount that would have been
payable under the restated financials. The excess portion will be repaid regardless of the Officers knowledge or approval of the original financial reporting rules and standards followed to produce the originally stated financial statements. 

(d) Business Expenses. The Company will reimburse Officer or otherwise provide for or pay for all reasonable expenses incurred by
Officer in furtherance of, or in connection with, the business of the Company, including, but not by way of limitation, travel expenses, club fees and dues, and memberships in professional organizations. The Company will reimburse Officer for
spousal travel expenses related to business functions that customarily require attendance by Officer and spouse. All business expenses are subject to such reasonable documentation and other limitations as may be established from time to time by the
Chief Executive Officer or the Board of Directors of the Company. 
 (e) Automobile. The Company may also provide the Officer with an
appropriate monthly automobile allowance, at the discretion of the Chief Executive Officer. At the discretion of the Board of Directors, an Officer may be provided with an appropriate automobile, and if so the Company will cover all costs associated
with the operation of that automobile, including insurance, maintenance, and fuel. 
 (f) Paid Time Off. The Officer will be entitled
to paid time off per year, based on the Company’s standard schedule, to be taken at such times and intervals as shall be determined by the Officer, with the approval of their supervisor, which approval shall not be unreasonably withheld. Due to
the demands of the position up to five days of paid time off may be carried over from one calendar year into the next year. 
 4.
Termination and Termination Benefits. Notwithstanding the provisions of Section 2, the Officer’s employment hereunder shall terminate, but not his restrictions on competition and solicitation, which shall survive any termination,
except a termination based on death or disability, under the following circumstances and shall be subject to the following provisions: 

(a) Death. If the Officer dies while employed by the Company during the terms of this contract, the Company will continue to pay an
amount equal to the Officer’s then current Base Salary to the Officer’s spouse or other designated beneficiary for six calendar months after the Officer’s death, with such payments to be made on the same periodic dates as salary
payments would have been made to the Officer had he not died. 
 (b) Disability. The Officer’s employment hereunder may be
terminated at any time because of the Officer’s Disability, defined as a condition where the Officer (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which
can be expected to result in death or can be expected to last for a continuous period of not less than 6 months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can
be expected to last for a continuous period of not less than 12 months, 

  
 2 

 
receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the Company. The Board, in its sole discretion, shall
determine whether a Participant has incurred a Disability and its determination shall be binding for purposes of this Plan. Notwithstanding termination under this subsection, Officer shall be eligible for participation in the Company’s
long-term disability policy subject to its terms. The Company shall provide continued welfare plan benefits in the Company’s health and welfare plans for the benefit of the Officer for a period of twelve months after the date of such
termination subject to his eligibility under the provisions of the then-current plan. 
 (c) Termination by the Company for Cause.
The Officer’s employment may be terminated at any time without further liability on the part of the Company effective immediately by a two-thirds vote of the Board of Directors of the Company for Cause by written notice to the Officer setting
forth in reasonable detail the nature of such Cause: 
 (i) Continued failure by the Officer for reasons other than Disability to follow
reasonable instructions of the Chief Executive Officer of the Company or policies of the Board of Directors of the Company after being advised in writing of such failure, including specific actions or inaction on the part of the Officer and the
particular instruction or policy involved, and if both reasonable and feasible, being given a reasonable opportunity and period (as determined by the Board of Directors of the Company) to remedy such failure; 

(ii) Conviction of a felony or any crime of moral turpitude; 

(iii) Commission of an act of embezzlement or fraud against the Company or any subsidiary or Affiliate thereof; 

(iv) Any act or omission constituting dishonesty of the Officer with respect to the Company or any subsidiary or Affiliate thereof; and/or

 (v) Any other willful or reckless conduct which substantially harms the reputation and/or interest of the Company, any subsidiary or
Affiliate, and/or its/or their directors, officers or employees. 
 (d) Termination by the Company Without Cause. The Officer’s
employment may be terminated without Cause by a two-thirds vote of the Board of Directors of the Company effective immediately by written notice to the Officer. In the event of termination without Cause, the Officer shall be entitled to twelve
months of continuation of his salary and twelve months of the Company’s then-current contribution to its welfare plan benefits in the Company’s health and welfare plans plus any vested benefits. No other compensation or benefits will be
provided. Any payment to be made pursuant to this subsection 4(d) shall not be made and any prior payment shall be subject to repayment in full should Officer violate any of his obligations under Section 5 hereof. 

(e) Resignation by Officer. Should Officer resign his employment hereunder for reasons other than disability, this Agreement shall
terminate, provided however that his obligations under Section 5 hereof shall continue after his resignation. In the event of resignation by Officer, the Officer shall be entitled to twelve months of continuation of his salary and twelve months
of the Company’s then-current contribution to its group health plan plus any vested benefits at the time of resignation. No other compensation or benefits will be provided under this contract. Any payment to be made pursuant to this subsection
4(e) shall not be made and any prior payment shall be subject to repayment in full should Officer violate any of his obligations under Section 5 hereof. 

  
 3 

 (f) Retirement. Should Officer retire from the service of the Company his compensation and
benefits payable hereunder shall cease on his last date of employment and this Agreement shall terminate, provided however that his obligations under Section 5 hereof shall continue after his resignation or retirement. Retirement is defined as
a departure from the Company on or after the date the Officer attains age sixty-five (65). 
 5. Covenants of the Officer. 

(a) Non-competition. The Officer agrees that during the Employment Period and for a one year period following the expiration or
termination of his employment for any reason, including resignation or retirement, the Officer will not as a principal, agent, employee, employer, investor, partner, joint venture participant or in any other individual or representative capacity
whatsoever, engage in a Competitive Business anywhere in the Bank’s Market Area (as such terms are defined below) in a competitive capacity that requires him to hold a similar office or to engage in similar duties to those which he held on
behalf of the Company and any of its Affiliates prior to or during the Employment Period. Notwithstanding the foregoing, the Officer may purchase or otherwise acquire up to (but not more than) 1% of any class of securities of any business enterprise
(but without otherwise participating in the activities of such enterprise) that engages in a Competitive Business in the Market Area and whose securities are listed on any national or regional securities exchange or have been registered under
Section 12 of the Securities Exchange Act of 1934. 
 (b) Non-solicitation. The Officer further agrees that during the
Employment Period and for a one year period following the expiration or termination of his employment for any reason, including resignation or retirement, he will not directly or indirectly: (i) solicit, induce, attempt to solicit or induce, or
accept the competitive business of any customer or client of the Company or its Affiliates with whom the Officer had contact or about whom or which Officer learned of or received proprietary information as a result of his employment with the
Company, to terminate, diminish, or materially alter in a manner harmful to the Company the relationship of such customer or client with the Company or its Affiliates; (ii) solicit, induce, encourage, or participate in soliciting, inducing, or
encouraging any employee to terminate his or her employment with the Company or any of its Affiliates; or (iii) hire, employ, or engage in business with or attempt to hire, employ, or engage in business with any person employed by the Company
or any of its Affiliates or who has left the employment of the Company or any of its Affiliates within the preceding six months. 
 (c)
Survival of Restrictive Covenants. Excepting only a termination by the Company for the Officer’s death or Disability, the provisions of subsections 5(a) and (b) shall survive any expiration or termination hereof, regardless of which
party initiated the termination or the cause or reason, if any, thereof. 
 (d) Definitions. As used in this Agreement, the term
“Competitive Business” means a financial services business which includes one or more of the following activities: consumer and commercial banking, residential and commercial mortgage lending, securities brokerage and asset management; the
term “Bank Market Area” means the area within a thirty-five mile radius of the Bank’s headquarters or within ten miles of any banking office that the Company has established and from which Officer has conducted Company business and
which the Company is continuing to operate at the time of termination or expiration of the Officer’s employment. “Mortgage Market Area” means the area within a thirty-five mile radius of the Mortgage Company’s headquarters or
within ten miles of any mortgage office that the Company has established and from which Officer has conducted Company business and which the Company is continuing to operate at the time of termination or

  
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expiration of the Officer’s employment. The term “Affiliate” means a Person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is
under common control with, the Company; and the term “Person” means any person, partnership, corporation, company, group or other entity. 

(e) Non-renewal of the Agreement. In the event the Company elects not to renew this Agreement in accordance with Section 2, the
provisions of Sections 5(a) and (b) shall not apply in connection with the termination of the Officer’s employment after the employment contract Expiration Date. 

(f) Confidentiality. During the Employment Period and thereafter, and except as required by any court, supervisory authority or
administrative agency or as may be otherwise required by applicable law, the Officer shall not, without the written consent of a person duly authorized by the Company, disclose to any person (other than his personal attorney, or an officer of the
Company or an Affiliate, or a person to whom disclosure is reasonably necessary or appropriate in connection with the performance by the Officer of his duties as an employee of the Company) or utilize in conducting a business any confidential
information obtained by him while in the employ of the Company, unless such information has become a matter of public knowledge at the time of such disclosure. For purposes of this Agreement, “Confidential Information” shall include, but
not be limited to, compensation details, trade secrets, methods of operation, names and lists of customers, prospective customers and their agents, advertising and promotional materials and methods, cost and pricing information, the special
requirements of any Company customer or prospective customer, price quotations to customers and prospective customers, sales records, profit and loss information, computer programs, management information systems and data, training materials,
selling and pricing procedures, financing methods, personnel records and data and related information, business plans, internal financial statements and projections, legal documents, including but not limited to contracts, sample legal forms,
standard operating procedures and policies, and any other information which would or reasonably could be used by an enterprise competing with the Company to gain a competitive advantage over the Company. Officer agrees that the Confidential
Information has independent economic value and that the Company takes steps to maintain and protect the Confidential Information. Officer agrees that all of the Company’s Confidential Business Information shall be deemed as Trade Secrets as
defined under the Virginia Uniform Trade Secrets Act as set forth in Va. Code Ann. §§ 59.1-336 
 (g) Reasonableness of
Restrictions. Officer and the Company have examined in detail these restrictive covenants and agree that the restraints imposed on Officer are reasonable in light of the legitimate interests of Officer and the Company, and it will not have an
unduly adverse impact on Officer’s ability to earn a livelihood. Officer expressly agrees that the definition of Competitive Business included herein is an accurate description of the Company’s business activities. Officer agrees that if
suit is brought to enforce the restrictive covenants contained in this Agreement, a previous breach by the Company of the Agreement shall not serve as a defense to the suit or any requested relief. 

6. Regulatory Provisions. 

(a) If Officer is suspended and/or temporarily prohibited from participating in the conduct of Company’s affairs by a notice served under
the Federal Deposit Insurance Act or any State or Federal Regulatory Order, Company’s obligations under this Agreement shall be suspended as of the 

  
 5 

 
date of service. If the charges in the notice are dismissed, Company shall (i) pay Officer all or part of the compensation withheld while its obligations under the Agreement were suspended,
and (ii) reinstate (in whole or in part) any of its obligations which were suspended. 
 (b) If Officer is removed and/or permanently
prohibited from participating in the conduct of Company’s affairs by an order issued under the Federal Deposit Insurance Act or any State or Federal Regulatory Order, all obligations of the Company under this Agreement shall terminate as of the
effective date of the order, but the Officer’s vested rights shall not be affected. 
 (c ) If Company is in default as defined in the
Federal Deposit Insurance Act or any State or Federal Regulatory Order, all obligations under this Agreement shall terminate as of the date of default, but the operation of this subparagraph 6.(c) shall not affect any of Officer’s vested
rights. 
 (d) The Company will use its commercially reasonable efforts to mitigate any adverse impact of subparagraphs 6.(a), 6.(b) and
6.(c ) on the Officer. 
 7. Assignability. The Company shall assign this Agreement and its rights and obligations hereunder in
whole, but not in part, to any corporation, company or other entity with or into which the Company may hereafter merge or consolidate or to which the Company may transfer all or substantially all of its assets, if in any such case said corporation,
company or other entity shall by operation of law or expressly in writing assume all obligations of the Company hereunder as fully as if it had been originally made a party hereto. The Officer may not assign or transfer this Agreement or any rights
or obligations hereunder. 
 8. Notices. For the purposes of this Agreement, notices and all other communications provided for in
this Agreement shall be in writing and shall be deemed to have been duly given when hand delivered or mailed by certified or registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth below: 

 

					
	To the Company:	  	Chief Executive Officer	  	
		  	Monarch Bank	  	
		  	1435 Crossways Boulevard	  	
		  	Chesapeake, Virginia 23320	  	
			
	To the Officer:	  	  
	  	
		  	  
	  	
		  	  
	  	

 9 Indemnification. The Company agrees to indemnify the Officer (and his heirs, executors, and
administrators) to the fullest extent permitted under applicable law and regulations against any and all expenses and liabilities reasonably incurred by him in connection with or arising out of any action, suit, or proceeding in which he may be
involved by reason of his having been a director or officer of the Company or any subsidiary of it (whether or not he continues to be a director or officer at the time of incurring any such expenses or liabilities) such expenses and liabilities to
include, but not be limited to, judgments, court costs, and attorney’s fees and the cost of reasonable settlements, such settlements to be approved by the Board, if such action is brought against the Officer in his capacity as an officer or
director of the Company or any of its subsidiaries. Indemnification for expense shall not 

  
 6 

 
extend to matters for which the Officer has been terminated for Cause. Nothing contained herein shall be deemed to provide indemnification prohibited by applicable law or regulation.
Notwithstanding anything herein to the contrary, the obligations of this Section 8 shall survive the term of this Agreement by a period of seven years. 

10. Costs of Enforcement. Should either party find it necessary to seek enforcement of any provision hereof, the prevailing party in
such action shall be entitled to his or its costs and expenses, including reasonable attorneys’ fees, up to a maximum of $30,000. 

11. Restrictive Covenants of the Essence. The restrictive covenants on the Officer set forth herein are of the essence of this
Agreement; they shall be construed as independent of any other provision in this Agreement. The existence of any claim or cause of action of the Officer against the Company, whether predicated on this Agreement or not, shall not constitute a defense
to the enforcement by the Company of the restrictive covenants contained herein. 
 12. Injunctive Relief. 

(a) Irreparable Injury. The Company and Officer agree that due to the Officer’s lengthy and extensive knowledge of the financial
industry in his or her respective market and of the Company in particular, he would be an especially effective competitor and that irreparable injury will result to the Company in the event Officer violates any obligation contained in Section 5
of this Agreement. Officer acknowledges that the remedies at law for any breach by Officer of such provisions will be inadequate and that the Company shall be entitled to injunctive relief against Officer, in addition to any other remedy that is
available. 
 (b) No Injunction Bond. Officer agrees that should injunctive relief be sought to restrain such violation(s) by Officer
and/or others acting in concert or participating with Officer, such relief will not require the posting of an injunction bond. 
 (c)
Injunction Measured from Date of Entry. Officer agrees that the confidentiality, non-competition, and non-solicitation obligations contained herein shall be extended by the length of time which Officer shall have been in breach of any of said
provisions. Accordingly, Officer recognizes that the time periods included in the restrictive covenants contained herein shall begin on the date a court of competent jurisdiction enters an order enjoining Officer from violating such provisions. 

13. Amendment / Waiver. No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or
discharge is agreed to in writing signed by the Officer and such officer or officers as may be specifically designated by the Board of Directors of the Company to sign on their behalf. No waiver by any party hereto at any time of any breach by any
other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

 14. Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter
hereof and no agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement. This Agreement supersedes and replaces
all prior employment agreements between the Company and the Officer. For purposes of this Agreement, the term “Company” includes any parent or subsidiaries of the Company, including Affiliates, any of which shall be awarded to the
protections of Section 5 hereof to the same extent as the Company. 

  
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 15. Governing Law. This Agreement shall be governed by and construed in accordance with
the laws of the Commonwealth of Virginia, and specifically the City of Chesapeake. 
 16. Nature of Obligations. Nothing contained
herein shall create or require the Company to create a trust of any kind to fund any benefits which may be payable hereunder, and to the extent that the Officer acquires a right to receive benefits from the Company hereunder, such right shall be no
greater than the right of any unsecured general creditor of the Company. 
 17. Headings. The Section headings contained in this
Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. 
 18.
Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provisions of this Agreement, which shall remain in full force and effect. It is the intention of the
parties that the provisions of the restrictive covenants herein shall be enforceable to the fullest extent permissible under the applicable law. If any clause or provision of this Agreement is held to be illegal, invalid or unenforceable under
present or future laws effective during the term hereof, then the remainder of this Agreement shall not be affected thereby, and in lieu of each clause or provision of this Agreement which is illegal, invalid or unenforceable, there shall be added,
as part of this Agreement, a clause or provision as similar in terms to such illegal, invalid or unenforceable clause or provision as may be possible and as may be legal, valid and enforceable. 

19. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all
of which together will constitute one and the same instrument. 
 IN WITNESS WHEREOF, this Agreement has been executed as of the date first
above written. 
  

			
	MONARCH BANK
		
	By:		 /s/ Brad E. Schwartz

			
		
	OFFICER		 /s/ William T. Morrison

		
			William T. Morrison

  
 8 

 ADDENDUM A to 

EMPLOYMENT AGREEMENT 
 This
Addendum A pertains to the Employment Agreement (“Agreement”) by and between Monarch Bank, a Virginia banking company (the “Company”), and William T. Morrison (the “Officer”). All capitalized terms that
are not defined herein shall have the meanings ascribed to those terms in the Agreement. This addendum is effective as of January 1, 2015. 

In addition to the benefits described in the Agreement, Officer shall be entitled to a portion of the Mortgage Profit Sharing Bonus
Pool. For each quarterly period that Officer is employed by Monarch Mortgage pursuant to the terms and conditions of the Agreement, Officer will receive a percentage of the quarterly pre-tax profit contribution of Monarch Mortgage (the
“Mortgage Profit Sharing Bonus”). The pre-tax profit contribution will be determined by the interest income and non-interest income generated less a reasonable cost of funds required to fund the assets of Monarch mortgage and less
non-interest expenses and state taxes if applicable. Explicitly excluded from the calculation are federal income taxes, non-realized gains and losses, portfolio mark to market gains or losses, unrealized gains on hedging the portfolio, and other
book entry items that do not represent the direct contribution of Monarch Mortgage. 
 For purposes of this section, the total Profit Bonus
pool shall equal twenty (20%) percent of the quarterly pre-tax profit contribution of Monarch Mortgage based on its historical accounting practices and internal financial reports consistently and reasonably computed. “Monarch
Mortgage” shall mean the assets, business and activities of the residential mortgage lending division of Monarch Mortgage, together with the functionally related, generated and managed assets of Monarch Mortgage. The Bonus shall be payable with
respect to Monarch Mortgage’s pre-tax profit during the fiscal quarters ending March 31, June 30, September 30 and December 31. Any Mortgage Profit Sharing Bonus to

  
 9 

 
which Officer is entitled shall be paid by the day that is 45 days following the end of the quarter for which the Mortgage Profit Sharing Bonus was earned. The percentage the Officer will be
entitled to the Mortgage Profit Sharing Bonus Pool shall be assigned by the Company’s Compensation Committee from time to time. Multiple Officers will share in the Mortgage Profit Sharing Bonus Pool, with no one individual receiving more than
fifty-percent of the total. 
 In the event that, during any quarterly period, Monarch Mortgage suffers a pre-tax loss, then the amount of
such total pre-tax loss shall be carried forward into one or more subsequent quarterly periods such that (i) the pre-tax losses shall be subtracted from subsequent quarterly pre-tax profits for purposes of determining whether a Profit Bonus is
payable for any subsequent quarters and the amount of such Profit Bonus and (ii) no Profit Bonus shall be payable to Officer during any calendar year if, as of the end of any given quarter during the year, Monarch Mortgage has suffered a net
negative pre-tax profit contribution on a year to date basis. 
 In the event that Officer’s employment under the Agreement is
terminated by the Company without Cause, then a partial quarter Mortgage Profit Sharing Bonus shall be payable based on Monarch Mortgage’s pre-tax profit contribution for the period beginning on the first day of the quarter in which Officer is
employed and ending on the date of such termination. Any partial quarter Mortgage Profit Sharing Bonus shall be payable by the day that is forty-five (45) days after the end of the quarter in which termination occurs and shall be calculated in
accordance with the provisions of this Addendum as described above. 

  
 10

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