Document:

Exhibit 10.2

 

Cariloha, Inc.

2022 Incentive Award Plan

 

		I.	Purposes of the Plan. Cariloha, Inc., a Delaware corporation (the “Company”),
establishes this 2022 Incentive Award Plan (the “Plan”) to promote the interests of the Company and its shareholders
by providing employees, non-employee directors, consultants, and other selected service providers of the Company and its Subsidiaries,
who are largely responsible for the management, growth, and protection of the business of the Company and its Subsidiaries, with incentives
and rewards to encourage them to continue in the service of the Company or its Subsidiaries.

 

		II.	Definitions. As used in the Plan or in any instrument governing the terms of any award granted
under the Plan, the following definitions apply to the terms indicated below:

 

		A.	“Award Agreement” means a written agreement, in a form determined by the Committee
from time to time, entered into by each Participant and the Company, evidencing the grant of an Incentive Award under the Plan.

 

		B.	“Board of Directors” means the Board of Directors of the Company.

 

		C.	“Cash Incentive Award” means an award granted to a Participant pursuant to Section
VIII of the Plan.

 

		D.	“Change in Control” means the occurrence, in a single transaction or in a series of
related transactions, of any one or more of the following events; provided, however, to the extent necessary to avoid adverse personal
income tax consequences to the Participant in connection with an Incentive Award, also constitutes a change in control event within the
meaning of Treasury Regulation section 1.409A-3(i)(5):

 

		1.	any Person becomes the owner, directly or indirectly, of securities of the Company representing more than
50% of the combined voting power of the Company’s then outstanding securities other than by virtue of a merger, consolidation or
similar transaction, excluding incremental acquisitions by Persons owning, directly or indirectly, greater than 50% of the combined voting
power as of the Effective Date. Notwithstanding the foregoing, a Change in Control shall not be deemed to occur (A) on account of the
acquisition of securities of the Company directly from the Company, (B) on account of the acquisition of securities of the Company by
an investor, any affiliate thereof or any other Person that acquires the Company’s securities in a transaction or series of related
transactions the primary purpose of which is to obtain financing for the Company through the issuance of equity securities, or (C) solely
because the level of ownership held by any Person (the “Subject Person”) exceeds the designated percentage threshold of the
outstanding voting securities as a result of a repurchase or other acquisition of voting securities by the Company reducing the number
of shares outstanding, provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition
of voting securities by the Company, and after such share acquisition, the Subject Person becomes the owner of any additional voting securities
that, assuming the repurchase or other acquisition had not occurred, increases the percentage of the then outstanding voting securities
owned by the Subject Person over the designated percentage threshold, then a Change in Control shall be deemed to occur;

 

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		2.	there is consummated a merger, consolidation or similar transaction involving (directly or indirectly)
the Company and, immediately after the consummation of such merger, consolidation or similar transaction, the stockholders of the Company
immediately prior thereto do not own, directly or indirectly, either (A) outstanding voting securities representing more than 50% of the
combined outstanding voting power of the surviving entity in such merger, consolidation or similar transaction or (B) more than 50% of
the combined outstanding voting power of the parent of the surviving entity in such merger, consolidation or similar transaction, in each
case in substantially the same proportions as their ownership of the outstanding voting securities of the Company immediately prior to
such transaction;

 

		3.	there is consummated a sale, lease, exclusive license or other disposition of all or substantially all
of the consolidated assets of the Company and its Subsidiaries, other than a sale, lease, license or other disposition of all or substantially
all of the consolidated assets of the Company and its Subsidiaries to an entity, more than 50% of the combined voting power of the voting
securities of which are owned by stockholders of the Company in substantially the same proportions as their ownership of the outstanding
voting securities of the Company immediately prior to such sale, lease, license or other disposition; or

 

		4.	individuals who, on the date the Plan is adopted by the Board, are members of the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the members of the Board; provided, however, that if the appointment
or election (or nomination for election) of any new Board member was approved or recommended by a majority vote of the members of the
Incumbent Board then still in office, such new member shall, for purposes of this Plan, be considered as a member of the Incumbent Board.

 

Notwithstanding the foregoing or any other
provision of this Plan, the term Change in Control shall not include a sale of assets, merger or other transaction effected exclusively
for the purpose of changing the domicile of the Company.

 

		E.	“Code” means the Internal Revenue Code of 1986, as amended from time to time, and all
regulations, interpretations, and administrative guidance issued thereunder.

 

		F.	“Committee” means the Compensation Committee of the Board of Directors or such other
committee as the Board of Directors shall appoint from time to time to administer the Plan and to otherwise exercise and perform the authority
and functions assigned to the Committee under the terms of the Plan.

 

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		G.	“Common Stock” means the Company’s Class A Common Stock, $0.0001 par value per
share, or any other security into which the Class A Common Stock shall be changed pursuant to the adjustment provisions of Section
IX.

 

		H.	“Company” means Cariloha, Inc., a Delaware corporation (and any successor thereto).

 

		I.	“Deferred Compensation Plan” means any plan, agreement, or arrangement maintained by
the Company from time to time that provides opportunities for deferral of compensation.

 

		J.	“Effective Date” means the date that is immediately prior to the date of the underwriting
agreement between the Company and the underwriter(s) managing the initial public offering of the Company’s Common Stock, pursuant
to which the Common Stock is priced for the initial public offering, provided that the Plan is approved by the Company’s shareholders
prior to such initial public offering date.

 

		K.	“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

		L.	“Fair Market Value” means, with respect to a share of Common Stock, as of the applicable
date of determination or if the market is not open for trading on such date, the immediately preceding day on which the market is open
for trading, the closing price as reported on the principal securities exchange on which shares of Common Stock are then listed or admitted
to trading (or if shares of Common Stock are then principally traded on a national securities exchange, in the reported “composite
transactions” for such exchange). In the event that the price of a share of Common Stock shall not be so reported, the Fair Market
Value of a share of Common Stock shall be determined by the Committee in its sole discretion.

 

		M.	“Incentive Award” means one or more Stock Incentive Awards and/or Cash Incentive Awards.

 

		N.	“Option” means a stock option to purchase shares of Common Stock granted to a Participant
pursuant to Section VI.

 

		O.	“Other Stock-Based Award” means an award granted to a Participant pursuant to Section
VII.

 

		P.	“Participant” means an employee, consultant, or director of the Company or a Subsidiary
who is eligible to participate in the Plan and to whom one or more Incentive Awards have been granted pursuant to the Plan and have not
been fully settled or cancelled and, following the death of any such Person, his successors, heirs, executors, and administrators, as
the case may be.

 

		Q.	“Person” means a “person” as such term is used in section 13(d) and 14(d)
of the Exchange Act, including any “group” within the meaning of section 13(d)(3) under the Exchange Act.

 

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		R.	“Plan” means this 2022 Incentive Award Plan, as it may be amended from time to time.

 

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

 

		T.	“Service” means the period during which an individual is classified or treated by the
Company or a Subsidiary as an employee, non-employee director, consultant, or other service provider of the Company or the Subsidiary,
as applicable.

 

		U.	“Stock Incentive Award” means an Option or Other Stock-Based Award granted pursuant
to the terms of the Plan.

 

		V.	“Subsidiary” means any “subsidiary” within the meaning of Rule 405 under
the Securities Act.

 

		W.	“Voting Power” means the number of votes available to be cast (determined by reference
to the maximum number of votes entitled to be cast by the holders of Voting Securities, or by the holders of any Voting Securities for
which other Voting Securities may be convertible, exercisable, or exchangeable, upon any matter submitted to shareholders where the holders
of all Voting Securities vote together as a single class) by the holders of Voting Securities.

 

		X.	“Voting Securities” means any securities or other ownership interests of an entity
entitled, or which may be entitled, to matters submitted to Persons holding such securities or other ownership interests in such entity
generally (whether or not entitled to vote in the general election of directors), or securities or other ownership interests which are
convertible into, or exercisable in exchange for, such Voting Securities, whether or not subject to the passage of time or any contingency.

 

		III.	Stock Subject to the Plan and Limitations on Cash Incentive Awards.

 

		A.	The maximum number of shares of Common Stock that may be covered by Incentive Awards granted under the
Plan shall not exceed the aggregate number of shares of Common Stock subject to the Plan as set forth on Schedule A. Such aggregate number
of shares of Common Stock will automatically increase on January 1 of each year for a period of ten years commencing on January 1, 2023
and ending on (and including) January 1, 2032, in an amount equal to the percentage set forth on Schedule A of the total number of shares
of Common Stock outstanding on the last day of the preceding calendar year; provided, however that the Board may act prior to the effective
date of any such annual increase to provide that the increase for such year will be a lesser number of shares of Common Stock. Out of
such number, the maximum number of shares of Common Stock that may be covered by Options that are designated as “incentive stock
options” within the meaning of section 422 of the Code shall not exceed the maximum number of shares of Common Stock for all Incentive
Awards as stated above in this Section III.A before giving effect to the annual increases. Shares of Common Stock issued
under the Plan may be authorized and unissued shares, treasury shares, shares purchased by the Company in the open market,
or any combination of the preceding categories as the Committee determines in its sole discretion.

 

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		B.	The maximum number of shares referred to in the preceding paragraph shall be subject to adjustment as
provided in Section IX and the following provisions of this Section III.

 

		C.	Shares of Common Stock covered by Incentive Awards shall only be counted as used to the extent they are
actually issued and delivered to a Participant (or such Participant’s permitted transferees as described in the Plan) pursuant to
the Plan; provided, however, that if shares of Common Stock are withheld to pay the exercise price of an Option or to satisfy any tax
withholding requirement in connection with an Incentive Award, the shares issued (if any) in connection with such settlement, and the
shares withheld, will be deemed delivered for purposes of determining the number of shares of Common Stock that are available for delivery
under the Plan. If shares of Common Stock are issued subject to conditions which may result in the forfeiture, cancellation or return
of such shares to the Company, any portion of the shares forfeited, cancelled, or returned shall be treated as not issued pursuant to
the Plan. If shares of Common Stock are not delivered in connection with an Incentive Award because the Incentive Award is settled in
cash rather than in Common Stock, no shares of Common Stock shall be counted as issued under the Plan. In addition, if shares of Common
Stock owned by a Participant (or such Participant’s permitted transferees as described in the Plan) are tendered (either actually
or through attestation) to the Company in payment of any obligation in connection with an Incentive Award, the number of shares tendered
shall be added to the number of shares of Common Stock that are available for delivery under the Plan.

 

		D.	Shares of Common Stock covered by Incentive Awards granted pursuant to the Plan in connection with the
assumption, replacement, conversion, or adjustment of outstanding equity-based awards in the context of a corporate acquisition or merger
shall not count as used under the Plan for purposes of this Section III.

 

		E.	Beginning with the calendar year following the calendar year in which the Effective Date occurs, the sum
of any cash compensation and the aggregate grant date fair value (determined as of the date of the grant under ASC Topic 718, or any successor
thereto) of all Incentive Awards granted to a non-employee director as compensation for services as a non-employee director may not exceed
the dollar amount set forth on Schedule A for the first year of service as a non-employee director and the dollar amount set forth on
Schedule A for each year thereafter.

 

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		IV.	Administration of the Plan.

 

		A.	The Plan shall be administered by a Committee of the Board of Directors consisting of two or more persons,
each of whom qualifies as a “non-employee director” (within the meaning of Rule 16b-3 promulgated under section 16 of the
Exchange Act) and as “independent” as required by any security exchange on which the Common Stock is listed, in each case
if and to the extent required by applicable law or necessary to meet the requirements
of such rule, section, or listing requirement at the time of determination. The Committee shall, consistent with the terms of the Plan,
from time to time designate those individuals who shall be granted Incentive Awards under the Plan and the amount, type, and other terms
and conditions of such Incentive Awards. All of the powers and responsibilities of the Committee under the Plan may be delegated by the
Committee, in writing, to any subcommittee thereof, in which case the acts of such subcommittee shall be deemed to be acts of the Committee
hereunder. The Committee may also from time to time authorize a subcommittee consisting of one or more members of the Board of Directors
(including members who are employees of the Company) and employees of the Company to grant Incentive Awards to persons who are not “executive
officers” of the Company (within the meaning of Rule 16a-1 under the Exchange Act) or a Subsidiary, subject to such restrictions
and limitations as the Committee may specify and to the requirements of section 157 of the Delaware General Corporation Law. Notwithstanding
the foregoing, the Plan shall be administered by the Board with respect to Incentive Awards to non-employee directors.

 

		B.	The Committee shall have full discretionary authority to administer the Plan, including discretionary
authority to interpret and construe any and all provisions of the Plan and any Award Agreement thereunder, and to adopt, amend, and rescind
from time to time such rules and regulations for the administration of the Plan, including rules and regulations related to sub-plans
established for the purpose of satisfying applicable foreign laws and/or qualifying for preferred tax treatment under applicable foreign
tax laws, as the Committee may deem necessary or appropriate. Decisions of the Committee shall be final, binding, and conclusive on all
parties. For the avoidance of doubt, the Committee may exercise all discretion granted to it under the Plan in a non-uniform manner among
Participants.

 

		C.	The Committee may delegate the administration of the Plan to one or more officers or employees of
                                                              the Company or a Subsidiary, and such administrator(s) may have the authority to execute and distribute Award Agreements, to
                                                              maintain records relating to Incentive Awards, to process or oversee the issuance of Common Stock under Incentive Awards, to
                                                              interpret and administer the terms of Incentive Awards, and to take such other actions as may be necessary or appropriate for the
                                                              administration of the Plan and of Incentive Awards under the Plan, provided that in no case shall any such administrator be
                                                              authorized (i) to grant Incentive Awards under the Plan (except in connection with any delegation made by the Committee pursuant to
                                                              paragraph A above), (ii) to take any action inconsistent with section 409A of the Code or (iii) to take any action inconsistent with
                                                              applicable provisions of the Delaware General Corporation Law. Any action by any such administrator within the scope of its
                                                              delegation shall be deemed for all purposes to have been taken by the Committee and, except as otherwise specifically provided,
                                                              references in this Plan to the Committee shall include any such administrator. The Committee and, to the extent it so provides, any
                                                              subcommittee, shall have sole authority to determine whether to review any actions and/or interpretations of any such administrator,
                                                              and if the Committee shall decide to conduct such a review, any such actions and/or interpretations of any
such administrator shall be subject to approval, disapproval, or modification by the Committee.

 

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		D.	On or after the date of grant of an Incentive Award under the Plan, the Committee may (i) accelerate the
date on which any such Incentive Award becomes vested, exercisable, or transferable (but only in connection with a Participant’s
death or disability), (ii) extend the term of any such Incentive Award, including, without limitation, extending the period following
a termination of a Participant’s Service during which any such Incentive Award may remain outstanding, (iii) waive any conditions
to the vesting, exercisability, or transferability, as the case may be, of any such Incentive Award or (iv) provide for the payment of
dividends or dividend equivalents with respect to any such Incentive Award; provided, that the Committee shall not have any such authority
to the extent that the grant of such authority would cause any tax to become due under section 409A of the Code.

 

		E.	Notwithstanding anything herein to the contrary, the Company shall not reprice any stock option (within
the meaning of Nasdaq Listing Rule 5635(c) and any other formal or informal guidance issued by Nasdaq) without the approval of the shareholders
of the Company, nor shall the Company purchase any underwater options for cash.

 

		F.	No member of the Committee shall be liable for any action, omission, or determination relating to the
Plan, and the Company shall indemnify and hold harmless each member of the Committee and each other director or employee of the Company
or a Subsidiary to whom any duty or power relating to the administration or interpretation of the Plan has been delegated, against any
cost or expense (including counsel fees) or liability (including any sum paid in settlement of a claim with the approval of the Committee)
arising out of any action, omission, or determination relating to the Plan, unless, in either case, such action, omission, or determination
was taken or made by such member, director, or employee in bad faith and without reasonable belief that it was in the best interests of
the Company.

 

		G.	The Company shall pay any amount payable with respect to an Incentive Award in accordance with the terms
of such Incentive Award, provided that the Committee may, in its discretion, defer the payment of amounts payable with respect to an Incentive
Award subject to and in accordance with the terms of a Deferred Compensation Plan.

 

		V.	Eligibility. The Persons who shall be eligible to receive Incentive Awards pursuant to the Plan
shall be those employees, non-employee directors, consultants, and other selected service providers of the Company and its Subsidiaries
whom the Committee shall select from time to time. Each Incentive Award granted under the Plan shall be evidenced by an Award Agreement.

 

		VI.	Options. The Committee may from time to time grant Options on such terms as it shall determine,
subject to the terms and conditions set forth in the Plan. The Award Agreement shall clearly identify such Option as
either an “incentive stock option” within the meaning of section 422 of the Code or as a non-qualified stock option.

 

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		A.	Exercise Price. The exercise price per share of Common Stock covered by any Option shall be not
less than one hundred percent of the Fair Market Value of a share of Common Stock on the date on which such Option is granted, other than
assumptions in accordance with a corporate acquisition or merger as described in Section III.

 

		B.	Term and Exercise of Options.

 

		1.	Each Option shall become vested and exercisable on such date or dates, during such period and for such
number of shares of Common Stock as shall be determined by the Committee on or after the date such Option is granted; provided,
however that no Option shall be exercisable after the expiration of ten years from the date such Option is granted; and, provided,
further, that each Option shall be subject to earlier termination, expiration, or cancellation as provided in the Plan or the Award
Agreement.

 

		2.	Each Option shall be exercisable in whole or in part; provided, however that no partial
exercise of an Option shall be for an aggregate exercise price of less than $1,000. The partial exercise of an Option shall not cause
the expiration, termination, or cancellation of the remaining portion thereof.

 

		3.	An Option shall be exercised by such methods and procedures as the Committee determines from time to time,
including without limitation through net physical settlement or other method of cashless exercise.

 

		C.	Special Rules for Incentive Stock Options.

 

		1.	The aggregate Fair Market Value of shares of Common Stock with respect to which “incentive stock
options” (within the meaning of section 422 of the Code) are exercisable for the first time by a Participant during any calendar
year under the Plan and any other stock option plan of the Company or any of its Subsidiaries that qualify as “subsidiaries”
(within the meaning of section 424 of the Code) shall not exceed $100,000. Such Fair Market Value shall be determined as of the date on
which each such stock option is granted. In the event that the aggregate Fair Market Value of shares of Common Stock with respect to such
incentive stock options exceeds $100,000, then incentive stock options granted hereunder to such Participant shall, to the extent and
in the order required by regulations promulgated under the Code (or any other authority having the force of regulations), automatically
be deemed to be non-qualified stock options, but all other terms and provisions of such stock options shall remain unchanged. In the absence
of such regulations (and authority), or in the event such regulations (or authority) require or permit a designation of the Options which
shall cease to constitute incentive stock options, incentive stock options granted hereunder shall, to
the extent of such excess and in the order in which they were granted, automatically be deemed to be non-qualified stock options, but
all other terms and provisions of such stock options shall remain unchanged.

 

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		2.	Incentive stock options may only be granted to individuals who are employees of the Company or its Subsidiaries.
No incentive stock option may be granted to an individual if, at the time of the proposed grant, such individual owns stock possessing
more than ten percent of the total combined Voting Power of all classes of stock of the Company or any of its “subsidiaries”
(within the meaning of section 424 of the Code), unless (i) the exercise price of such incentive stock option is at least 110 percent
of the Fair Market Value of a share of Common Stock at the time such incentive stock option is granted and (ii) such incentive stock option
is not exercisable after the expiration of five years from the date such incentive stock option is granted.

 

		3.	Neither the Company nor the Committee will be liable to a Participant, or any other party, if an Option fails or ceases to qualify
as an incentive stock option.

 

		VII.	Other Stock-Based Awards. The Committee may from time to time grant equity-based or equity-related
awards not otherwise described herein in such amounts and on such terms as it shall determine, subject to the terms and conditions set
forth in the Plan. Without limiting the generality of the preceding sentence, each such Other Stock-Based Award may (i) involve the transfer
of actual shares of Common Stock to Participants, either at the time of grant or thereafter, or payment in cash or otherwise of amounts
based on the value of shares of Common Stock, (ii) be subject to performance-based and/or service-based conditions, (iii) be in the form
of stock appreciation rights (which, if any, shall have an exercise price of no less than 100% of the Fair Market Value of the underlying
shares on the date of grant), phantom stock, restricted stock, restricted stock units, performance shares, deferred share units, or share-denominated
performance units and (iv) be designed to comply with applicable laws of jurisdictions other than the United States; provided,
that each Other Stock-Based Award shall be denominated in, or shall have a value determined by reference to, a number of shares of Common
Stock that is specified at the time of the grant of such Incentive Award.

 

		VIII.	Cash Incentive Awards. The Committee may from time to time grant Cash Incentive Awards on such
terms as it shall determine. Cash Incentive Awards may be settled in cash or in other property, including shares
of Common Stock, provided that the term “Cash Incentive Award” shall exclude any Option or Other Stock-Based Award.

 

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		IX.	Adjustment Upon Certain Changes. Subject to any action by the shareholders of the Company required
by law, applicable tax rules or the rules of any exchange on which shares of common stock of the Company are listed for trading:

 

		A.	Shares Available for Grants. In the event of any change in the number of shares of Common Stock
outstanding by reason of any stock dividend or split, recapitalization, merger, consolidation, combination, or exchange of shares or similar
corporate change, the maximum aggregate number or type of shares of Common Stock with respect to which the Committee may grant Incentive
Awards, the maximum number of shares of Common Stock that may be covered by Options that are designated as “incentive stock options”
within the meaning of section 422 of the Code and the maximum aggregate number of shares of Common Stock with respect to which the Committee
may grant Incentive Awards to any individual Participant in any year and to any non-employee director shall be appropriately adjusted
or substituted by the Committee. In the event of any change in the type or number of shares of Common Stock of the Company outstanding
by reason of any other event or transaction, the Committee shall, to the extent deemed appropriate by the Committee, make such adjustments
to the type or number of shares of Common Stock with respect to which Incentive Awards may be granted.

 

		B.	Increase or Decrease in Issued Shares Without Consideration. In the event of any increase or decrease
in the number of issued shares of Common Stock resulting from a subdivision or consolidation of shares of Common Stock or the payment
of a stock dividend (but only on the shares of Common Stock), or any other increase or decrease in the number of such shares effected
without receipt or payment of consideration by the Company, the Committee shall, in the manner deemed appropriate by the Committee, equitably
adjust the type or number of shares of Common Stock subject to each outstanding Incentive Award, the exercise price per share of Common
Stock of each such Incentive Award, and any other terms of such Incentive Award that are affected by the event.

 

		C.	Certain Mergers and Other Transactions.

 

		1.	In the event of any merger, consolidation, or similar transaction as a result of which the holders of
shares of Common Stock receive consideration consisting exclusively of securities of the surviving corporation in such transaction, the
Committee shall, to the extent deemed appropriate by the Committee, adjust each Incentive Award outstanding on the date of such merger
or consolidation so that it pertains and applies to the securities which a holder of the number of shares of Common Stock subject to such
Incentive Award would have received in such merger or consolidation.

 

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		2.	In the event of (i) a dissolution or liquidation of the Company, (ii) a sale of all or substantially all
of the Company’s assets (on a consolidated basis), (iii) a merger, consolidation or similar
transaction involving the Company in which the holders of shares of Common Stock receive securities and/or other property, including cash,
the Committee shall, to the extent deemed appropriate by the Committee, have the power to:

 

		a.	cancel, effective immediately prior to the occurrence of such event, each Incentive Award (whether or
not then exercisable or vested), and, in full consideration of such cancellation, pay to the Participant to whom such Incentive Award
was granted an amount in cash, for each share of Common Stock subject to such Incentive Award, equal to the value, as determined by the
Committee, of such Incentive Award, provided that with respect to any outstanding Option such value shall be equal to the excess of (A)
the value, as determined by the Committee, of the property (including cash) received by the holder of a share of Common Stock as a result
of such event over (B) the exercise price of such Option; or

 

		b.	provide for the exchange of each Incentive Award (whether or not then exercisable or vested) for an Incentive
Award with respect to (A) some or all of the property which a holder of the number of shares of Common Stock subject to such Incentive
Award would have received in such transaction or (B) securities of the acquiror or surviving entity and, incident thereto, make an equitable
adjustment as determined by the Committee in the exercise price of the Incentive Award, or the number of shares or amount of property
subject to the Incentive Award or provide for a payment (in cash or other property) to the Participant to whom such Incentive Award was
granted in partial consideration for the exchange of the Incentive Award.

 

		D.	Other Changes. In the event of any change in the capitalization of the Company, corporate change,
corporate transaction, or other event other than those specifically referred to in the preceding paragraphs of this Section IX,
the Committee shall, to the extent deemed appropriate by the Committee, make such adjustments in the number and class of shares subject
to Incentive Awards outstanding on the date on which such change occurs and in such other terms of such Incentive Awards as the Committee
deems appropriate.

 

		E.	Cash Incentive Awards. In the event of any transaction or event described in this Section
IX, the Committee shall, to the extent deemed appropriate by the Committee, make such adjustments in the terms and conditions
of any Cash Incentive Award as the Committee deems appropriate.

 

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		F.	No Other Rights. Except as expressly provided in the Plan or any Award Agreement, no Participant
shall have any rights by reason of any subdivision or consolidation of shares of stock of any class, the payment of any dividends or dividend
equivalents, any increase or decrease in the number of shares of stock of any class or any dissolution, liquidation,
merger, or consolidation of the Company or any other corporation. Except as expressly provided in the Plan, no issuance by the Company
of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason
thereof shall be made with respect to, the number of shares or amount of other property subject to, or the terms related to, any Incentive
Award.

 

		G.	Savings Clause. No provision of this Section IX shall be given effect to the extent
that such provision would cause any tax to become due under section 409A of the Code.

 

		X.	Change in Control; Separation from Service.

 

		A.	Change in Control. The consequences of the termination of employment of a Participant in connection
with a Change in Control shall be set forth, if at all, in the Award Agreement (or an applicable employment agreement) of the Participant
as determined in the sole discretion of the Company. Notwithstanding the foregoing and except to the extent the Committee specifically
established otherwise in an applicable Award Agreement (or applicable employment agreement), and except as provided in Section IV.C,
in the event of a Change in Control, unless provision is made in connection with the Change in Control for assumption or continuation
of Incentive Awards previously granted or substitution of such Incentive Awards for new awards covering shares of a 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) with appropriate adjustments as to the number and kinds of shares and, if applicable, exercise prices and
performance goals, in each case, that the Committee determines shall preserve the material terms and conditions of such Incentive Awards
as in effect immediately prior to the Change in Control (including with respect to the vesting schedules, the intrinsic value of the awards
(if any) as of the Change in Control, the difficulty of achieving performance goals (if applicable) and transferability of the shares
underlying such Incentive Awards), immediately prior to the occurrence of a Change in Control, any Incentive Awards that are still outstanding
following such Change in Control shall become fully vested and exercisable and all restrictions on such Incentive Awards shall lapse as
of the date of the Change in Control.

 

With respect to the
vesting of Incentive Awards that will accelerate upon the occurrence of a Change in Control pursuant to this paragraph (A) and that have
multiple vesting levels depending on the level of performance, unless otherwise provided in the Award Agreement or unless otherwise provided
by the Board, the vesting of such Incentive Awards will accelerate at 100% of the target level upon the occurrence of the Change in Control
in which the Awards are not assumed in accordance with the previous paragraph.

 

		B.	Separation from Service. The Award Agreement shall specify the consequences with respect to such
Incentive Awards of the separation from Service of the Participant holding the Incentive Awards.

 

    12

    

    

 

		1.	With respect to any Incentive Awards subject to section 409A of the Code, separation from Service shall
mean a separation from service within the meaning of section 409A of the Code.

 

		2.	With respect to any Incentive Awards not subject to section 409A of the Code:

 

		a.	Separation from Service shall mean a separation from service within the meaning of section 409A of the
Code, unless the Participant is retained as a consultant pursuant to a written agreement and such agreement provides otherwise. Without
limiting the generality of the foregoing, the Committee shall determine whether an authorized leave of absence, or absence in military
or government service, shall constitute separation from Service, provided that a Participant who is an employee will not be deemed to
cease employment in the case of any leave of absence approved by the Company.

 

		b.	A Participant who ceases to be an employee of the Company but continues, or simultaneously commences,
services as a director of the Company shall not be deemed to have had a separation from Service for purposes of the Plan.

 

		XI.	Rights Under the Plan. No Person shall have any rights as a shareholder with respect to any shares
of Common Stock covered by or relating to any Incentive Award until the date of the issuance of such shares on the books and records of
the Company. Except as otherwise expressly provided in Section IX hereof, no adjustment of any Incentive Award shall be
made for dividends or other rights for which the record date occurs prior to the date of such issuance. Nothing in this Section
XI is intended, or should be construed, to limit authority of the Committee to cause the Company to make payments based on the
dividends that would be payable with respect to any share of Common Stock if it were issued or outstanding, or from granting rights related
to such dividends.

 

The Company shall not have any obligation
to establish any separate fund or trust or other segregation of assets to provide for payments under the Plan. To the extent any person
acquires any rights to receive payments hereunder from the Company, such rights shall be no greater than those of an unsecured creditor.

 

		XII.	No Special Employment Rights; No Right to Incentive Award.

 

		A.	Nothing contained in the Plan or any Award Agreement shall confer upon any Participant any right with
respect to the continuation of his or her Service by the Company or its Subsidiaries or interfere in any way with the right of the Company
or its Subsidiaries at any time to terminate such Service or to increase or decrease the compensation of the Participant from the rate
in existence at the time of the grant of an Incentive Award.

 

    13

    

    

 

		B.	No person shall have any claim or right to receive an Incentive Award hereunder. The Committee’s
granting of an Incentive Award to a Participant at any time shall neither require the Committee to grant an Incentive Award to such Participant
or any other Participant or other person at any time nor preclude the Committee from making subsequent grants to such Participant or any
other Participant or other person.

 

		XIII.	Securities Matters.

 

		A.	The Company shall be under no obligation to affect the registration pursuant to the Securities Act of
any shares of Common Stock to be issued hereunder or to effect similar compliance under any state or local laws. Notwithstanding anything
herein to the contrary, the Company shall not be obligated to cause to be issued shares of Common Stock pursuant to the Plan unless and
until the Company is advised by its counsel that the issuance is in compliance with all applicable laws, regulations of governmental authority,
and the requirements of any securities exchange on which shares of Common Stock are traded. The Committee may require, as a condition
to the issuance of shares of Common Stock pursuant to the terms hereof, that the recipient of such shares make such covenants, agreements,
and representations, and that any related certificates representing such shares bear such legends, as the Committee, in its sole discretion,
deems necessary or desirable.

 

		B.	The exercise or settlement of any Incentive Award (including, without limitation, any Option) granted
hereunder shall only be effective at such time as counsel to the Company shall have determined that the issuance and delivery of shares
of Common Stock pursuant to such exercise is in compliance with all applicable laws, regulations of governmental authority and the requirements
of any securities exchange on which shares of Common Stock are traded. The Company may, in its sole discretion, defer the effectiveness
of any exercise or settlement of an Incentive Award granted hereunder in order to allow the issuance of shares pursuant thereto to be
made pursuant to registration or an exemption from registration or other methods for compliance available under federal or state or local
securities laws. The Company shall inform the Participant in writing of its decision to defer the effectiveness of the exercise or settlement
of an Incentive Award granted hereunder. During the period that the effectiveness of the exercise of an Incentive Award has been deferred,
the Participant may, by written notice, withdraw such exercise and obtain the refund of any amount paid with respect thereto.

 

		XIV.	Withholding Taxes.

 

		A.	Cash Remittance. Whenever withholding tax obligations are incurred in connection with any Incentive
Award, the Company shall have the right to require the Participant to remit to the Company in cash an amount sufficient to satisfy federal,
state, and local withholding tax requirements, if any, attributable to such event. In addition, upon the exercise or settlement of any
Incentive Award in cash, or the making of any other payment with respect to any Incentive Award (other than in shares of Common Stock),
the Company shall have the right to withhold from any payment required to be made pursuant thereto
an amount sufficient to satisfy the federal, state, and local withholding tax requirements, if any, attributable to such exercise, settlement,
or payment.

 

    14

    

    

 

		B.	Stock Remittance. If permitted in an Award Agreement, at the election of the Participant, subject
to the approval of the Committee, whenever withholding tax obligations are incurred in connection with any Incentive Award, the Participant
may tender to the Company (including by attestation) a number of shares of Common Stock having a Fair Market Value at the tender date
determined by the Committee to be sufficient to satisfy the minimum federal, state, and local withholding tax requirements, if any, attributable
to such event. Such election shall satisfy the Participant’s obligations under paragraph A above, if any.

 

		C.	Stock Withholding. If permitted in an Award Agreement (which may specify that stock withholding
is mandatory or that it is at the election of the Participant subject to the approval of the Committee), whenever withholding tax obligations
are incurred in connection with any Incentive Award, the Company shall withhold a number of such shares having a Fair Market Value determined
by the Committee to be sufficient to satisfy the minimum federal, state, and local withholding tax requirements, if any, attributable
to such event. Such election shall satisfy the Participant’s obligations under paragraph A above, if any.

 

		XV.	No Obligation to Exercise. The grant to a Participant of an Incentive Award shall impose no obligation
upon such Participant to exercise such Incentive Award.

 

		XVI.	Transfers. Incentive Awards may not be sold, pledged, assigned, hypothecated, transferred, or disposed
of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of a Participant,
only by the Participant; provided, however that the Committee may permit Options or other Incentive Awards that are not
incentive stock options to be sold, pledged, assigned, hypothecated, transferred, or disposed of, on a general or specific basis, subject
to such conditions and limitations as the Committee may determine. Upon the death of a Participant, outstanding Incentive Awards granted
to such Participant may be exercised only by the executors or administrators of the Participant’s estate or by any person or persons
who shall have acquired such right to exercise by will or by the laws of descent and distribution. No transfer by will or the laws of
descent and distribution of any Incentive Award, or the right to exercise any Incentive Award, shall be effective to bind the Company
unless the Committee shall have been furnished with (a) written notice thereof and with a copy of the will and/or such evidence as the
Committee may deem necessary to establish the validity of the transfer and (b) an agreement by the transferee to comply with all the terms
and conditions of the Incentive Award that are or would have been applicable to the Participant and to be bound by the acknowledgements
made by the Participant in connection with the grant of the Incentive Award.

 

		XVII.	Expenses and Receipts. The expenses of the Plan shall be paid by the Company (or as determined
by the Company, a Subsidiary as applicable). Any proceeds received by the Company in connection with any Incentive
Award will be used for general corporate purposes.

 

    15

    

    

 

		XVIII.	Failure to Comply. In addition to the remedies of the Company elsewhere provided for herein, failure
by a Participant to comply with any of the terms and conditions of the Plan or any Award Agreement shall be grounds for the cancellation
and forfeiture of such Incentive Award, in whole or in part, as the Committee, in its absolute discretion, may determine.

 

		XIX.	Relationship to Other Benefits. No payment with respect to any Incentive Awards under the Plan
shall be taken into account in determining any benefits under any pension, retirement, profit sharing, group insurance, or other benefit
plan of the Company or a Subsidiary except as otherwise specifically provided in such other plan.

 

		XX.	Governing Law. The Plan and the rights of all persons under the Plan shall be construed and administered
in accordance with the laws of the State of Delaware without regard to its conflict of law principles.

 

		XXI.	Severability. If all or any part of this Plan is declared by any court or governmental authority
to be unlawful or invalid, such unlawfulness or invalidity shall not serve to invalidate any portion of this Plan not declared to be unlawful
or invalid. Any Section or part of a Section so declared to be unlawful or invalid shall, if possible, be construed in a manner that will
give effect to the terms of such Section or part of a Section to the fullest extent possible while remaining lawful and valid.

 

		XXII.	Effective Date and Term of Plan. The Effective Date of the Plan is as defined above. No grants
of Incentive Awards may be made under the Plan after the tenth anniversary of that Effective Date.

 

		XXIII.	Amendment or Termination of the Plan. The Board of Directors may at any time suspend or discontinue
the Plan or revise or amend it or any Incentive Award in any respect whatsoever; provided, however, that to the extent that
any applicable law, tax requirement, or rule of a stock exchange requires shareholder approval in order for any such revision or amendment
to be effective, such revision or amendment shall not be effective without such approval. The preceding sentence shall not restrict the
Committee’s ability to exercise its discretionary authority hereunder pursuant to Section IV, which discretion may
be exercised without amendment to the Plan. No provision of this Section XXIII shall be given effect to the extent that
such provision would cause any tax to become due under section 409A of the Code. Except as expressly provided in the Plan, no action hereunder
may, without the consent of a Participant, adversely affect the Participant’s rights under any previously granted and outstanding
Incentive Award. Nothing in the Plan shall limit the right of the Company or a Subsidiary to pay compensation of any kind outside the
terms of the Plan.

 

		XXIV.	Recoupment. Notwithstanding anything in the Plan or in any Award Agreement to the contrary, the
Company will be entitled to the extent permitted or required by applicable law, Company policy and/or the requirements of an exchange
on which the Company’s shares are listed for trading, in each
case, as in effect from time to time to recoup compensation of whatever kind paid by the Company at any time to a Participant under this
Plan.

 

    16

    

    

 

Schedule A

 

Applicable Limits

 

		·	Section III.A. – Maximum number of shares of Common Stock that may be covered by Incentive Awards under the Plan: 1,245,870

 

		·	Section III.A. – Annual percentage increase in the number of shares of Common Stock that may be covered by Incentive Awards
under the Plan: 3%

 

		·	Section III.E. – Maximum dollar amount of the sum of cash compensation and Incentive Awards for a non-employee director in the
non-employee director’s first year of service as a non-employee director: $250,000

 

		·	Section III.E. – Maximum dollar amount of the sum of cash compensation and Incentive Awards for a non-employee director after
the first service year (described above): $400,000

 

    17

    

    

 

Appendix
A

 

Standard
Stock Option Forms Package

 

Cariloha,
Inc.

 

2022
Incentive Award Plan

 

    18

    

    

 

Appendix
B

 

Standard
Restricted Stock Award Forms Package

 

Cariloha,
Inc.

 

2022
Incentive Award Plan

 

    19

    

    

 

Appendix
C

 

Standard
RSU Forms Package

 

Cariloha,
Inc.

 

2022
Incentive Award Plan

 

    20Exhibit
10.3

 

Cariloha,
Inc.

Change in Control Severance Plan

 

		I.	Purposes of the Plan. Cariloha, Inc., a Delaware corporation (the “Company”),
establishes this Change in Control Severance Plan (the “Plan”) to provide severance benefits to certain key executives
and other employees in the event of a termination of employment in connection with a Change in Control (as defined below) in return for
a waiver and release of all employment-related claims against the Company. The purposes of this Plan include to encourage continued service
of the Plan’s participants to the Company, to alleviate some of the financial uncertainty such individuals may otherwise have in
circumstances surrounding a Change in Control, and to finally resolve potential employment claims with participants receiving benefits
under the Plan.

 

		II.	Definitions. As used in the Plan, the following terms shall have the meanings set forth below:

 

		A.	“Administrator” means the Board of Directors of the Company or any committee duly authorized
by the Board of Directors of the Company to administer the Plan or, subject to Section IX of the Plan, any delegee thereof.

 

		B.	“Affiliate” means any entity that directly or indirectly controls, is controlled by
or is under common control with the Company.

 

		C.	“Board” means the Board of Directors of Cariloha, Inc.

 

		D.	“Cause” is to be construed the same as such similar term is defined in any employment
agreement, offer letter, or service provider agreement between a Participant and the Company as may be in force from time to time, and
in the absence of such agreement or letter, shall mean, as determined by the Company, the Participant’s (i) failure to reasonably
perform the Participant’s duties to the Company or to follow the lawful instructions of his or her superiors in a manner that could
reasonably be expected to result in harm to the Company, other than as a result of incapacity due to physical or mental illness or injury;
(ii) willful violation of the Company’s written policies that could reasonably be expected to result in harm to the Company; (iii)
engaging in conduct that is, or could reasonably expected to be, materially damaging to the Company; (iv) willful misconduct or gross
negligence that could reasonably be expected to result in harm to the Company; (v) act of fraud or misappropriation, embezzlement or misuse
of funds or property belonging to the Company; (vi) conviction of, or plea of guilty or no contest to, a felony or any crime involving
as a material element fraud or dishonesty; or (vii) willful breach of a fiduciary duty owed to the Company.

 

		E.	“Change in Control” means “Change in Control” as defined under the Company’s
2022 Incentive Award Plan, as it may be amended, restated or replaced from time to time.

 

    1

     

    

 

		F.	“Change-in-Control Period” means the period from the date of the Change in Control
to the end of the 12-month period immediately following the Change in Control.

 

		G.	“Code” means the Internal Revenue Code of 1986, as amended from time to time.

 

		H.	“Company” means Cariloha, Inc. and, unless the context indicates otherwise, its Affiliates.

 

		I.	“Eligible Employee” means any management or highly compensated employee of the Company
or an Affiliate, which category may be further limited by the Administrator to a more selective group of officers or executives.

 

 

		J.	“ERISA” means the Employee Retirement Income Security Act of 1974, as it may be amended
from time to time.

 

		K.	“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.

 

		L.	“Good Reason” is to be construed the same as such similar term is defined in any employment
agreement or offer letter between a Participant and the Company as may be in force from time to time, and in the absence of such agreement
or letter, shall mean the occurrence of any of the following circumstances, without the Participant’s written consent, which remains
uncured by the Company for at least 15 days after the Company’s receipt of notice thereof from the Participant; provided that such
notice must be received by the Company within 20 days after the date the circumstance constituting Good Reason first came into existence:
(i) a material reduction in the Participant’s base salary or target annual bonus opportunity, other than a reduction that is part
of and consistent with a reduction in compensation of all similarly situated employees of the Company; (ii) a material diminution of the
Participant’s titles, duties, responsibilities or authority; provided that, for the avoidance of doubt, a change in title, duties,
responsibilities or authority that arises from a reorganization or integration undertaken in connection with a Change in Control shall
not be construed to be a material diminution if the duties, responsibilities and authority after the change are reasonably comparable
in the aggregate to those existing prior to the change; or (iii) a relocation of the Participant’s principal place of employment
that results in an increase by more than 100 miles from the Participant’s then-current principal residence.

 

		M.	“Participant” means an Eligible Employee who has been selected to participate in the
Plan pursuant to Section III.

 

		N.	“Plan” means this Change in Control Severance Plan, as it may be amended from time
to time.

 

		O.	“Qualifying Termination” means a termination of a Participant’s employment with
the Company during the Change in Control Period, which employment termination is initiated either (i) by the Company
as a termination without Cause or (ii) by the Participant as a resignation for Good Reason. For the avoidance of doubt, no Qualifying
Termination shall have occurred as a result of a termination of employment that is on account of the Participant’s death, disability
or voluntary retirement, or due to a termination for Cause.

 

    2

     

    

 

		P.	“Qualifying Termination Date” means, with respect to a Qualifying Termination, the
date on which a Participant’s employment with the Company is to terminate pursuant to a notice of termination from the Company to
the Participant or a notice of resignation for Good Reason from the Participant to the Company, as the case may be.

 

		Q.	“Qualifying Termination Payments” means the payments and benefits for which Participants
experiencing a Qualifying Termination are eligible pursuant to Section IV.

 

		R.	“Section 409A” means section 409A of the Code, any successor provisions thereto, and
the guidance issued thereunder, as amended from time to time.

 

		III.	Plan Participation. The Administrator shall designate, from time to time, the Eligible Employees
who may become participants in the Plan upon signing an acknowledgement of participation in such form as may be required by the Administrator
(each, a “Participant”). An Eligible Employee who becomes a Participant shall continue to be a Participant eligible
for benefits under the Plan until (i) the individual is no longer employed by the Company under circumstances not constituting a Qualifying
Termination, (ii) the Plan term expires without a Change in Control, (iii) the individual has a Qualifying Termination and all of the
Qualifying Termination Payments owed to the individual have been made, or (iv) the individual ceases to be a Participant pursuant to an
amendment of the Plan, subject to the restrictions under Section VIII.

 

		IV.	Qualifying Termination Payments. A Participant experiencing a Qualifying Termination shall be eligible
for the cash severance payments described in this Section IV, subject to (i) the Participant’s continued employment
through the Qualifying Termination Date (unless this condition is waived by the Company), and (ii) the Participant’s timely execution,
delivery and non-revocation of a general release of claims against the Company in such form as may be required by the Administrator (“General
Release”).

 

		A.	The Participant shall be eligible for a cash payment equal to the sum of (A) the number of months (as
specified in the acknowledgement of participation described in Section III) of the Participant’s annual base salary
as in effect immediately prior to the Qualifying Termination Date (or, if greater, prior to a reduction in annual base salary constituting
the grounds for a Good Reason resignation resulting in the Participant’s Qualifying Termination), plus (B) the average of the Participant’s
annual bonuses earned, if any, during the three-year period ending on the Qualifying Termination Date.

 

    3

     

    

 

		B.	Subject to Section V (six month delay) and unless installments are specified in the Participant’s
acknowledgement of participation described in Section III, the cash payment shall be made in a lump sum within 60 days after
the Qualifying Termination Date, but in no case prior to the expiration of the revocation period of the General Release. Notwithstanding
the foregoing, if the payment constitutes nonqualified deferred compensation subject to Section 409A and the time in which the Participant
delivers an executed General Release could affect whether the Participant would receive the payment in the Participant’s taxable
year in which the General Release review period begins or the subsequent taxable year, then the payment will be made (absent a revocation
of the General Release) as soon as practicable after the later of the first business day of the subsequent taxable year or the day following
the expiration of the revocation period.

 

		C.	For any Qualifying Termination, the Participant shall only be eligible for the severance benefits constituting
Qualifying Termination Payments under this Plan and no other severance benefits for which the Participant may otherwise have been eligible
under any other severance plan of the Company and/or an individual agreement between the Company and the Participant (collectively, “Other
Severance Benefits”) for the same employment termination event. By accepting participation in this Plan, the Participant waives
any and all rights and interest in any Other Severance Benefits that may have otherwise arisen in connection with a Qualifying Termination;
provided that, for the avoidance of doubt, the Participant shall be entitled to all accrued and non-forfeitable compensation and benefits
owed to him or her in connection with the Participant’s employment with the Company.

 

		D.	Notwithstanding anything in the Plan to the contrary, the Company will be entitled to the extent permitted
or required by applicable law, Company policy or the requirements of an exchange on which the Company’s common stock may be listed
for trading, in each case, as in effect from time to time, to effectuate a forfeiture of all or part of the Qualifying Termination Payments
and/or recoup compensation of whatever kind paid by the Company pursuant to the Plan.

 

		E.	A Participant’s entitlement to cash payment under this Section IV is subject to the
Participant’s continued compliance with any non-competition, non-solicitation, non-disclosure or similar restrictive covenant obligation
owed to the Company for a period equal to the number of months of severance pay specified in the Participant’s acknowledgement of
participation, commencing on the Qualifying Termination Date (the “Prohibited Period”). If a Participant fails to comply with
any such obligations after benefits under this Plan have already been paid, such benefits shall be subject to recoupment by the Company.

 

		V.	Six-Month Delay for Specified Employees. Notwithstanding any provision of this Plan to the contrary,
if a Participant is a “specified employee,” then, to the extent required under Treasury Regulation section 1.409A-3(i)(2),
any payments that constitute “nonqualified deferral of compensation” that become due upon the Participant’s “separation
from service” (other than due to the Participant’s death) and that would have been made under the terms of the Plan within
the six-month period commencing on the Participant’s “separation from service”
shall be delayed and instead be made as soon as practicable after the end of such six-month period. For purposes of this paragraph, the
terms “specified employee,” “nonqualified deferral of compensation,” and “separation from service”
have the meanings given to them under Section 409A.

 

    4

     

    

 

		VI.	Section 280G Golden Parachute Cutback (“Best Net”). Notwithstanding anything in the
Plan to the contrary, if any Qualifying Termination Payments payable to the Participant under the Plan would constitute “parachute
payments” and, either alone or when combined with any other “parachute payments” payable to the Participant (collectively,
the “Total Payments”), would result in any “excess parachute payments” becoming subject to the excise tax imposed
by section 4999 of the Code, or any successor provision thereto (the “Excise Tax”), then the Total Payments shall be reduced
to an amount equal to One Dollar ($1) less than the maximum amount that could be paid to Executive without giving rise to any Excise Tax
(the “Safe Harbor Cap”); provided that the reduction contemplated by this section shall be applied only if the net after-tax
benefit to the Participant after such reduction would be greater than the net after-tax benefit to Participant without such reduction
(notwithstanding the application of any Excise Tax on the unreduced Total Payments). For the avoidance of doubt, Participant shall be
responsible for the payment of any Excise Tax arising from the Total Payments. For purposes of this paragraph, the terms “parachute
payment” and “excess parachute payment” have the meanings given to them under section 280G of the Code. Any reduction
required by this paragraph shall be applied, first, to any Qualifying Termination Payments that do not constitute nonqualified deferred
compensation subject to Section 409A, in the order elected by the Company and, second, to any Qualifying Termination Payments that do
constitute such nonqualified deferred compensation, in reverse order of the date the payment is to be made (or the benefit is to be provided).
Unless otherwise agreed in writing by the Company and the Participant, all determinations required under this paragraph shall be made
by the Company or its delegate and shall be conclusive and binding on all persons.

 

		VII.	Term of the Plan. The Plan shall remain in effect for a term of 5 years after the date of its approval
by the Board (subject to an extension of the term by the Company), unless a Change in Control occurs prior to the expiration of the term.
No Qualifying Termination Payments shall be due with respect to a Change in Control that occurs after the term of the Plan has expired.
If a Change in Control occurs within the term of the Plan, the Plan shall terminate automatically immediately following the satisfaction
of any Qualifying Termination Payments owed with respect to such Change in Control, but in no case shall any rights accrue under the Plan
with respect to any subsequent Change in Control.

 

		VIII.	Amendment and Termination. The Plan may be amended or terminated by the Company at any time.

 

		IX.	Administration of the Plan. The Plan shall be administered by the Administrator, whose actions
and determinations in such capacity shall be final, conclusive and binding upon all persons. The Administrator may employ attorneys, consultants,
accountants, agents and other individuals to assist in administration of the Plan, and the Company and its officers and directors shall
be entitled to rely upon the advice, opinions or valuations of any such individuals. The Administrator shall have full authority to interpret
the terms and the intent of the Plan and to adopt such rules,
regulations, forms, and guidelines for administering the Plan as the Administrator may deem necessary or proper. The Administrator may
delegate administrative authority of the Plan (other than the selection of Participants), in whole or in part, to one or more officers
or employees of the Company, provided that no such delegees shall have the authority to interpret or administer the terms of the Plan
pertaining to Participants who are subject to section 16 of the Exchange Act.

 

    5

     

    

 

		X.	Claims. The claims procedures of this Section X shall be construed and interpreted
in a manner consistent with the applicable provisions of section 503 of ERISA.

 

		A.	Initial Claim for Benefits. A Participant may submit a claim for the benefits provided under this
Plan to the Administrator in writing, along with any information or documentation needed to process the claim. The Administrator will
respond to the claim request by written notice within ninety (90) days after it receives the request and any such information and documentation.
If the Administrator denies the claim, in whole or in part, it will give written notice of the decision to the claimant (which term includes
the claimant’s authorized representative) that sets forth, in a manner calculated to be understood by the claimant, (i) the specific
reason(s) for the denial, (ii) a specific reference to the pertinent Plan provision(s) on which the denial is based, (iii) any additional
information or documentation the claimant may need to perfect the claim, along with an explanation of why the additional information or
documentation is needed, and (iv) the procedure and timeframe for further review of the claim, including a statement regarding the claimant’s
right to bring a civil action under section 502(a) of ERISA following an adverse benefit determination upon review.

 

		B.	Request for Review of Claim Denial. The claimant shall have the right to make a request in writing
to the Administrator to review any initial claim denial within sixty (60) days after receiving the notice of the denial. The claimant
has the right, upon written request, to review or receive copies, free of charge, any documents, records or other information relevant
to the claimant’s denied claim, and may submit written comments, documents, records and other information in connection with the
request for review (even if not submitted with the initial claim). The Administrator will respond to the request for review by written
notice within sixty (60) days after receiving the request. If the Administrator continues to deny the claim, in whole or in part, the
notice will set forth, in a manner calculated to be understood by the claimant, (i) the specific reason(s) for the denial, (ii) a specific
reference to the pertinent Plan provision(s) on which the decision is based, (iii) a statement that the claimant has the right, upon written
request, to review or receive copies, free of charge, any documents, records or other information relevant to the claimant’s denied
claim, and (iv) a statement regarding the claimant’s right to bring a civil action under section 502(a) of ERISA.

 

		XI.	Miscellaneous Provisions.

 

		A.	Governing Law. To the extent not preempted by ERISA or any other federal law, the Plan and the
rights of all persons under the Plan shall be construed and interpreted in accordance with the laws
of the State of Delaware without regard to its conflict of law principles.

 

    6

     

    

 

		B.	Severability. If any part of the Plan is declared by any court or governmental authority to be
unlawful or invalid, such unlawfulness or invalidity shall not serve to invalidate any portion of the Plan not declared to be unlawful
or invalid. Any section or part of a section so declared to be unlawful or invalid shall, if possible, be construed in a manner that will
give effect to the terms of such section or part of a section to the fullest extent possible while remaining lawful and valid.

 

		C.	Section 409A. It is intended that the Plan will comply with Section 409A, including to the fullest
extent applicable any exceptions to the requirements of Section 409A thereunder (such as, without limitation, for short-term deferrals,
separation pay arrangements, reimbursements, and in-kind distributions), and the Plan shall be administered accordingly and interpreted
and construed on a basis consistent with such intent. To the extent that any provision of the Plan would fail to comply with the applicable
requirements of Section 409A, the Administrator may, in its sole and absolute discretion and without requiring a Participant’s consent,
make such modifications to the Plan and/or Qualifying Termination Payments to the extent it determines necessary or advisable to comply
with the requirements of Section 409A; provided, however, that the Company shall in no event be obligated to pay any interest, compensation,
or penalties in respect of any such modifications. If any amount payable to a Participant under the Plan is to be paid in two or more
installments, each installment shall be treated as a separate payment for purposes of Section 409A.

 

		D.	No Implied Rights. No individual shall have any claim or right to become a Participant in the Plan,
except pursuant to Section III hereof. Nothing contained in the Plan shall confer upon any Participant any right with respect
to the continuation of his or her employment by the Company or interfere in any way with the right of the Company at any time to terminate
such employment. No Qualifying Termination Payments shall be treated as compensation for purposes of determining any benefits payable
under any Company retirement, life insurance or other employee benefit plan, unless otherwise required by the terms of the plan or local
law.

 

		E.	Withholding. The Company shall withhold from any Qualifying Termination Payment all federal, state,
local or other taxes as it deems necessary or appropriate to comply with applicable law.

 

		F.	No Assignment; Successors to Participants. Except as provided below or required under applicable
law, none of a Participant’s rights or interest under the Plan, or with respect to any Qualifying Termination Payments, shall be
assigned, transferred or alienated, in whole or in part, including, without limitation, by execution, levy, garnishment, attachment, pledge
or in any manner. Notwithstanding the foregoing, if a Participant dies after becoming entitled to any Qualifying Termination Payments
(including satisfaction of the condition that a General Release has become effective without
revocation through the entire revocation period) but before the full amount of such Qualifying Termination Payments are paid, any unpaid
cash amounts shall be paid as soon as administratively practicable to the Participant’s heirs, or to the authorized representative
of the participant’s estate.

 

		G.	Unfunded Plan. The Plan shall be unfunded. The adoption of the Plan shall not be deemed to create
a trust or other funded arrangement. Any rights to Qualifying Termination Payments under the Plan shall be those of a general unsecured
creditor of the Company.

 

    7

     

    

 

Appendix
A

 

Cariloha,
Inc.

 

Change
in Control Severance Plan

 

Sample
Participation Agreement

 

    8

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