Document:

Exhibit 10.2

 

EMPLOYMENT
AGREEMENT

 

THIS AGREEMENT (this
"Agreement") is made as of January 1, 2015 (the "Effective Date"), between Rx Safes, Inc. (the "Company"),
doing business at 170 South Green Valley Parkway, Suite 300, Henderson, NV 89012 and Lorraine Yarde (the "Employee"),
residing at 670 Du Fort Avenue, Henderson, NV 89002. The Company and the Employee are sometimes hereinafter referred to individually
as a "Party" and together as "Parties." Capitalized terms used in this Agreement but not otherwise defined
herein shall have the meaning given to them in Section 12 below.

 

WHEREAS, the Employee has substantial
business knowledge, expertise and experience in the conduct of the business of the Company and the Company desires to retain the
knowledge, expertise and experience of the Employee to assist in the operations and management of the Company and its Subsidiaries;

 

WHEREAS, Employee acknowledges that
the Company and its Subsidiaries expend substantial resources establishing long term relationships with their Customers and Employee
will from time to time during the course of his employment be exposed to such Customers and prospective customers and clients;

 

WHEREAS, Employee acknowledges that
in connection with his employment Employee will have access to valuable Confidential Information (as defined in Section 8 below)
including, but not limited to, the Company's and its Subsidiaries' methods of doing business, business plans and trade secrets;
and

 

WHEREAS, the Company desires that the
Employee not directly or indirectly compete with the Company or its Subsidiaries for a reasonable period of time because of the
detrimental effect such competition would have on the business of the Company and its Subsidiaries;

 

NOW THEREFORE, in consideration of the
mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the Parties hereto, intending to be legally bound, agree as follows:

 

1.     Employment.
The Company hereby employs the Employee and the Employee hereby accepts employment, pursuant to the terms and conditions of this
Agreement.

 

2.     Employment;
Term. The Company hereby employs Employee, and Employee hereby accepts employment with the Company, upon the terms and conditions
set forth in this Agreement for the period beginning on the Effective Date and continuing until terminated as provided in Section
6 hereof (such period being the "Employment Period").

 

3.     Position
and Duties.

 

(a)     During the Employment
Period, Employee will serve as Chief Executive Officer of the Company and will have the normal duties, responsibilities and authority
of this office, subject to the power of the Board to expand or limit such duties, responsibilities and authority and to override
Employee's actions.

 

(b)     During the Employment
Period, Employee will report to the Board and will devote her full time, best efforts and attention (except for permitted vacation
periods and reasonable periods of illness or other incapacity) to the business and affairs of the Company and its Subsidiaries
and to the performance of such duties, as aforesaid and as may be assigned to her from time to time by the Company. Employee will
act in the best interest of the Company and its Subsidiaries and, except as may be specifically permitted by the Board, will not
engage in any other business activity. Employee will perform her duties, responsibilities and functions on behalf of the Company
and its Subsidiaries hereunder to the best of her abilities in a diligent, trustworthy, businesslike and efficient manner. However,
nothing in this Agreement shall bar or impair the Employee from continuing her existing or future Corporate Board Affiliations
providing any affiliation is not deemed a competitor of Company.

 

4.     Compensation.

 

(a)     During
the Employment Period, Employee's base salary will be no less than $175,000 per annum
(as adjusted from time to time, the "Base Salary"). Employee's Base Salary will be paid by the Company in regular
installments in accordance with the Company's general payroll practices and may be increased in the sole discretion of the Board.

 

    	 

    	 

    

 

(b)     In
addition to the Base Salary, for each complete calendar year during the Employment Period so long as Employee is employed by the
Company on the last day of such calendar year Employee will be eligible to earn a performance bonus ("Performance Bonus").
Employee's target Performance Bonus for each complete fiscal year will be equal to fifty percent (50%) of her Base Salary for
such fiscal year (the "Target Bonus"). The actual amount of the Performance Bonus payable to Employee for any
fiscal year may be greater than or less than the Target Bonus for such fiscal year and will be determined by the decision of the
disinterested Directors of the Board based on the achievement of certain financial and individual performance goals to be established
annually by the Board. Any Performance Bonus payable pursuant to this Section 3(b) will be payable in a lump sum at such time
as may be determined by the Board, but no later than the earlier of (i) ten (10) business days after the Company finalizes its
audited financial statements for the applicable year or (ii) 150 days following the end of such fiscal year.

 

(c)     Upon Employee's execution of this Agreement, the Company will immediately grant to Employee an option to purchase 10,000,000 shares
of the Company's Common Stock with a vesting and strike price set as follows:

 

(i)     5,000,000 shares vested immediately with
a strike price of $0.05 per share

 

(ii)     2,500,000 shares
vested on the six month anniversary of this agreement if Employee is still working for the Company with a strike price of $0.05
per share.

 

(iii)     1,5000,000 shares
vested on the first anniversary of this agreement if Employee is still working for the Company with a strike price of $0.10 per
share.

 

(iv)     1,000,000 shares
vested on the second anniversary of this agreement if Employee is still working for the Company with a strike price of $0.25 per
share.

 

(d)     The options above shall vest according
to the above schedule, and can be exercised at any time, up to and including 24 months after expiration or termination of this
agreement. The options above shall be delivered to employee in the form of an option within 14 days of execution of this agreement
and approval by the board of directors.

 

(e)     Upon any merger and/or
acquisition transaction involving the Company, or a Change in Control of the Company, all of the stock options referred to in Paragraphs
4(c) shall vest automatically and immediately.

 

(f)     Employee will have
the right, at any time during the course of this agreement, and up to 6 months after the expiration of the term of this agreement
or any extension thereto, to convert any then unpaid compensation to Company stock at a 50% discount to the then market rate of
the Company’s Common Stock based on the closing price of the prior days trading, in the form of registered securities (S8
shares). Employee shall notify the company in writing at least 5 business days prior to the end of the month that the Employee
elects to take said compensation in the form of stock. The company must make arrangements for said stock transfer within 5 business
days of the receipt of the written notification, and said stock must be delivered within 15 days of receipt of said notice to the
Company or the Company shall be deemed in default, this agreement terminated, and all compensation due shall be automatically accelerated
and all unvested options shall become vested.

 

(g)     Employee will be entitled
to an annual salary increase of no less than 10% of the prior year’s annual salary to commence on the first day after each
year anniversary.

 

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5.     Benefits.

 

In addition to the Base
Salary and other compensation provided for in Section 4 above, Employee will be entitled to the following benefits during the Employment
Period:

 

		(a)	Employee will be entitled to participate in the Company's health and welfare benefit programs and
vacation and other benefit programs for which other employees of the Company are generally eligible, subject to any eligibility
requirements of such plans and programs. If the Company does not offer a health and welfare benefit program, employee will be entitled
to reimbursement of expenses paid by employee for a private health and benefit program up to $1,000 each calendar month.

 

		(b)	The Company will reimburse Employee for all reasonable expenses
incurred by her in the course of performing her duties and responsibilities under this Agreement which are consistent with the
Company's policies in effect from time to time with respect to travel, entertainment and other business expenses, subject to the
Company's requirements with respect to reporting and documentation of such expenses. For purposes of Code Section 409A, any reimbursements
otherwise payable to Employee under this Section 4(b) shall be paid no later than the end of the calendar month following the month
in which related expense was incurred, the amount of expenses reimbursed in one month shall not effect the amount eligible for
reimbursement in any subsequent month, and Employee's right to reimbursement under this Agreement will not be subject to liquidation
or exchange for another benefit.

 

		(c)	The Company shall indemnify and hold harmless the Employee
against all claims arising out of Employee's actions or omissions occurring during Employee's employment with the Company to the
fullest extent provided (A) by the Company's Certificate of Incorporation and/or Bylaws, and (B) under the Nevada General Corporation
Law, as each may be amended from time to time. The Company shall maintain a Directors & Officers liability insurance policy
("D&O Coverage") covering Employee to the same extent as the Company provides such coverage for its other executive
officers and directors. The Company agrees to make such policy available to Employee within 30 days of the commencement of her
employment. The aforesaid indemnification and hold harmless obligations shall include any costs or expenses (including attorneys'
fees), judgments, fines, losses, claims, damages or liabilities incurred in connection with any claim, action, suit, proceeding
or investigation, whether civil, criminal, administrative or investigative, by reason of the fact that the Employee is or was a
director, officer, employee or agent of the Company or any Subsidiary, whether asserted or claimed prior to, at or after the date
of the Employee's termination of employment, to the fullest extent permitted under applicable law and on a basis no less favorable
than in existence under the Company's Bylaws and Certificate of Incorporation in effect as of the Effective Date of this Agreement.
This provision shall survive the Employee's employment and require the Company to maintain a Directors & Officers liability
insurance policy ("D&O Coverage") on behalf of the Employee, for a period of two (2) years.

 

6.     Termination.

 

		(a)	Notwithstanding Section 1 of this Agreement, Employee's employment with the Company and
the Employment Period will end on the earlier of (i) the Employee's death or mental or physical disability or incapacity, such
that she is unable to fulfill her duties and responsibilities, with or without a reasonable accommodation (as determined by a physician
selected by the Company in its good faith judgment), (ii) the Employee's resignation or (iii) termination by the Company at any
time with or without Cause (as defined below). Except as otherwise provided herein, any termination of the Employment Period by
the Company or by the Employee will be effective as specified in a written notice from the terminating Party to the other Party.

 

		(b)	If
                                         during the Employment Period the Employee's employment with the Company is terminated
                                         pursuant to Section 6(a)(i) above, or is terminated by the Company with
                                         Cause or if the Employee resigns for any reason other than Good Reason, then Employee
                                         will only be entitled to receive her Base Salary through the date of termination and
                                         payment (at the rate of base salary then in effect) for any vacation time accrued during
                                         the portion of the then-current calendar year ending with the date of such termination
                                         and not used prior to that date and will not be entitled to any other salary, bonus,
                                         severance, compensation or benefits from the Company or any of its Subsidiaries or affiliates
                                         or their benefit plans, other than vested retirement benefits or insurance continuation
                                         rights expressly required under applicable law (such as the Consolidated Omnibus Budget
                                         Reconciliation Act of 1985, as amended ("COBRA").

 

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		(c)	If
                                         (i) Employee's employment with the Company is terminated during the Employment Period
                                         by the Company without Cause or by the Employee with Good Reason and, in either case,
                                         (ii) Employee executes a general release (the "Release") in favor of
                                         the Company, their Subsidiaries and their affiliates in form and substance satisfactory
                                         to the Company within 25 days of such termination and such release becomes effective
                                         and is not revoked or rescinded, (iii) Employee complies with the terms of this Agreement
                                         and the Release, and (iv) Employee has worked for the company for at least one month,
                                         Employee will be entitled to receive as severance her Base Salary for a period equal
                                         to the number of complete months she has worked for the Company, up to a maximum of twelve
                                         (12) months. The severance payments payable to Employee pursuant to this clause (c) of
                                         this Section will be paid over time at the times and in the manner that his Base Salary
                                         is paid pursuant to Section 3 hereof, beginning at the end of the first complete
                                         pay period following the sixtieth (60th) day after such termination. Notwithstanding
                                         the foregoing, if the Company is a "public company" within the meaning of Internal
                                         Revenue Code Section 409A, any amounts payable to Employee during the first six months
                                         and one day following the date of termination pursuant to this Section 6(c) will be deferred
                                         until the date which is six (6) months and one day following such termination, and if
                                         such payments are required to be so deferred the first payment will be in an amount equal
                                         to the total amount to which Employee would otherwise have been entitled during the period
                                         following the date of termination of employment if deferral had not been required.

 

		(d)	Except as otherwise expressly provided herein, all of Employee's rights to salary, bonuses, fringe benefits, severance and other compensation hereunder or under any policy or program or benefit
plans of the Company or any of its Subsidiaries which might otherwise accrue or become payable on or after the termination of the
Employment Period will cease upon such termination other than vested retirement benefits or insurance continuation rights expressly
required under applicable law (such as COBRA).

 

		(e)	For purposes of this Agreement,
                                         "Cause" will mean (i) conviction of a felony, (ii) repeated and continuous
                                         failure to perform lawful duties as reasonably directed by the Board and only after written
                                         notice has been provided to Employee within 10 days after each such incident of failure,
                                         (iii) gross negligence or willful misconduct with respect to the Company or any of its
                                         Subsidiaries or affiliates or in the performance of Employee's duties hereunder, (iv)
                                         violating any of the terms of the Company's established rules or policies which, if curable,
                                         is not cured to the Board's reasonable satisfaction within forty-five (45) days after
                                         written notice thereof to Employee, (v) any other material breach of this Agreement or
                                         any other agreement between the Employee and the Company or any of its Subsidiaries which,
                                         if curable, is not cured to the Board's reasonable satisfaction within fifteen (15) days
                                         after written notice thereof to Employee.

 

		(f)	For purposes of this Agreement,
                                         "Good Reason" will mean (i) Employee is demoted to a position other
                                         than Chief Executive Officer, (ii) any material breach of this Agreement by the Company,
                                         which breach is not cured within forty-five (45) business days following written notice
                                         to the Company of such breach, or (iii) the Company requiring Employee, without Employee's
                                         prior consent, to be permanently based at any office located more than ten (10) miles
                                         from the Company's office at which Employee is based as of the date of this Agreement,
                                         excluding travel reasonably required in the performance of Employee's duties hereunder,
                                         (iv) a Change of Control, or (v) the Company's liquidation, insolvency, assignment for
                                         the benefit of creditor(s), or upon the filing of a petition in bankruptcy provided that
                                         in the case of clauses (i), (ii), (iii), or (iv) an event or circumstance, (v) shall
                                         only constitute "Good Reason" during the ninety (90) day period following the
                                         date of such assignment (after which it shall be deemed waived by Employee if prior thereto
                                         Employee has not exercised his right to resign for "Good Reason"), (vi) shall
                                         only constitute "Good Reason" if Employee gives written notice to the Company
                                         of his intent to terminate this Agreement and the Company fails to remedy the same within
                                         forty five (45) days after such notice.

 

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7.     Non-Disparagement.

 

Employee
agrees not to disparage or impugn the Company, its subsidiaries or any members of its Board. Likewise, the Company, its subsidiaries,
the members of its Board and its management level employees will not disparage or impugn Employee. Any inquiries regarding Employee
will be forwarded to the Chairman of the Company's Board or other dis-interested Board member, who will provide a neutral employment
reference for Employee (which includes dates of employment, the position held, the duties of that position and with Employee's
authorization, compensation information).

 

8.     Confidential Information.

 

		(a)	Employee recognizes and acknowledges that the continued success
of the Company and its Subsidiaries depends upon the use and protection of a large body of confidential and proprietary information
and that Employee will have access to certain Confidential Information of the Company, its Subsidiaries and affiliates and Persons
with which the Company and its Subsidiaries do business, and that such Confidential Information constitutes valuable, special and
unique property of the Company, its Subsidiaries and affiliates and such other Persons. "Confidential Information" will
be interpreted to include all information of any sort (whether merely remembered or embodied in a tangible or intangible form)
that is (i) related to the Company's or its Subsidiaries' or affiliates' (including their predecessors) current or potential business
and (ii) not generally or publicly known. Confidential Information includes, without limitation, the information and data obtained
by Employee while employed by the Company and its Subsidiaries concerning the business or affairs of the Company or any of its
Subsidiaries or affiliates, including information concerning acquisition opportunities in or reasonably related to the Company's
or its Subsidiaries' or affiliates' business or industry, the identities of the current, former or prospective employees, suppliers
and customers of the Company or its Subsidiaries, development, transition and transformation plans, methodologies and methods of
doing business, strategic, marketing and expansion plans, financial and business plans, financial data, pricing information, employee
lists and telephone numbers, locations of sales representatives, new and existing customer or supplier programs and services, customer
terms, customer service and integration processes, requirements and costs of providing service, support and equipment, any or all
of which are not generally or publicly known. The Employee agrees that he will use the Confidential Information only as necessary
and only in connection with the performance of his duties hereunder. Employee agrees that he will not knowingly disclose to any
unauthorized Person or use for his own or any other purposes (except as described in the immediately preceding sentence) any Confidential
Information without the prior written consent of the Board, unless and to the extent that (a) the Confidential Information becomes
generally known to and available for use by the public other than as a result of Employee's acts or omissions or (b) Employee is
ordered by a court of competent jurisdiction to disclose Confidential Information, provided that Employee must (i) provide prompt
written notice to the Company of any relevant process or pleadings that could lead to such an order and (ii) cooperate with the
Company to contest, object to or limit such a request and, in any case, when revealing, such Confidential Information to such court
order.

 

		(b)	Employee understands that the Company and its Subsidiaries and affiliates will receive from third
parties confidential or proprietary information ("Third Party Information") subject to a duty on the Company and
its Subsidiaries and affiliates to maintain the confidentiality of such information and to use it only for certain limited purposes.
During the Employment Period and thereafter, and without in any way limiting the foregoing provisions of this Section 8, Employee
will hold Third Party Information in the strictest confidence and will not knowingly disclose to anyone (other than personnel and
consultants of the Company or its Subsidiaries and affiliates who need to know such information in connection with their work for
the Company or its Subsidiaries and affiliates) or use Third Party Information unless expressly authorized by such third party
or by the Board.

 

		(c)	Employee will use in the performance of his duties only information which is (i) generally known
and used by persons with training and experience comparable to Employee's and which is (a) common knowledge in the industry or
(b) is otherwise legally in the public domain, (ii) is otherwise provided or developed by the Company or any of its Subsidiaries
or affiliates or (iii) in the case of materials, property or information belonging to any former employer or other person or entity
to whom Employee has an obligation of confidentiality, approved
for such use in writing by such former employer or other Person.

 

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9.     Return of Corporate Property.

 

Employee
acknowledges and agrees that all notes, records, reports, sketches, plans, unpublished memoranda or other documents, whether in
paper, electronic or other form (and all copies thereof), held by Employee concerning any information relating to the business
of the Company or any of its Subsidiaries, whether confidential or not, are the property of the Company. Employee will deliver
to the Company at the termination or expiration of the Employment Period, or at any other time the Company may request, all equipment,
files, property, memoranda, notes, plans, records, reports, printouts and software and other documents and data (and all electronic,
paper or other copies thereof) belonging to the Company or any of its Subsidiaries which he may then possess or have under his
control.

 

10.     Intellectual Property Rights.

 

Employee acknowledges and
agrees that all inventions, technology, processes, innovations, ideas, improvements, developments, methods, designs, analyses,
trademarks, service marks, and other indicia of origin, writings, audiovisual works, concepts, drawings, reports and all similar,
related, or derivative information or works (whether or not patentable or subject to copyright), including but not limited to all
patents, copyrights, copyright registrations, trademarks, and trademark registrations in and to any of the foregoing, along with
the right to practice, employ, exploit, use, develop, reproduce, copy, distribute copies, publish, license, or create works derivative
of any of the foregoing, and the right to choose not to do or permit any of the aforementioned actions, which relate to the Company's
or any of its Subsidiaries' or affiliates' actual or anticipated business, research and development or existing or future products
or services and which are conceived, developed or made by Employee while employed by the Company and its Subsidiaries or any of
their predecessors (collectively, the "Work Product") belong to the Company or such Subsidiary. All Work Product
created by Employee while employed by the Company or any of its predecessors will be considered "work made for hire,"
and as such, the Company is the sole owner of all rights, title, and interests therein. All other rights to any new Work Product
and all rights to any existing Work Product, including but not limited to all of Employee's rights to any copyrights or copyright
registrations related thereto, are conveyed, assigned and transferred to the Company pursuant to this Agreement. Employee will
promptly disclose and deliver such Work Product to the Company and, at the Company's expense, perform all actions reasonably requested
by the Company (whether during or after the Employment Period) to establish, confirm and protect such ownership (including, without
limitation, the execution of assignments, copyright registrations, consents, licenses, powers of attorney and other instruments).

 

11.     Employee's Representations.

 

Employee hereby represents
and warrants to the Company that (i) she has entered into this Agreement of her own free will for no consideration other than as
referred to herein, (ii) the execution, delivery and performance of this Agreement by Employee does not and will not conflict with,
breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which Employee is a
party or by which Employee is bound, (iii) Employee is not a party to or bound by any employment, non-competition, confidentiality
or other similar agreement with any other Person and (iv) upon the execution and delivery of this Agreement by the Company, this
Agreement will be the valid and binding obligation of Employee, enforceable in accordance with its terms. Employee hereby acknowledges
and represents that Employee has had the opportunity to consult with independent legal counsel regarding Employee's rights and
obligations under this Agreement and that Employee fully understands the terms and conditions contained herein.

 

12.     Definitions.

 

"Board" means the
Board of Directors of the Company.

 

"Business" means the business
(whether conducted or to be conducted in the future) of (a) developing, providing, marketing and selling medicine safes with fingerprint
technology, and (b) providing any other products or services which the Company or any of its Subsidiaries provide during the Employment
Period.

 

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"Change
of Control" means the occurrence of any of the following events, whether in one or a series of related transactions:
(a) the acquisition of at least fifty percent (50%) of the then outstanding shares of common stock of RX Safes, Inc. by any Person
or entity, (b) the acquisition of all or substantially all of the assets of RX Safes, Inc., or (c) any merger or consolidation
of RX Safes, Inc., provided that the events described in clause (b) or (c) of this definition will not be deemed a Change of Control
if more than fifty percent (50%) of the then outstanding shares of common stock of the acquiring entity or surviving entity (in
the case of a merger) are owned by Persons who, immediately prior to such event, owned more than fifty percent (50%) of the then
outstanding shares of common stock of RX Safes, Inc., as the case may be. In determining whether the fifty percent (50%) threshold
discussed above has been met, shares which are subject to voting control by a Person or Persons acting under a voting agreement
(but not a revocable proxy) will be counted, even though such shares may not be owned by such Person.

 

"Customer" means any Person
who: (a) purchased products or services from the Company or any Subsidiary during the two years prior to the date of termination
of Employee's employment.

 

"Person" means any natural
person, corporation, general partnership, limited partnership, limited liability company or partnership, proprietorship, other
business organization, trust, union, association or governmental or regulatory entities, department, agency or authority.

 

"Subsidiaries" means any
corporation, limited liability company or other entity of which the securities or other ownership interests having the voting
power to elect a majority of the board of directors or other governing body are, at the time of determination, owned by the Company
or any corporation or other entity of which the Company or one of its Subsidiaries serves as the managing member or in a similar
capacity, in each case either directly or through one or more Subsidiaries, the names and addresses of which will be provided
to the Employee upon execution of this Agreement .

 

13.     Survival.

 

Sections 7, 8, 9 and 10
will survive and continue in full force in accordance with their terms notwithstanding the termination of the Employment Period.

 

14.     Notices.

 

Any notice provided for
in this Agreement will be in writing and will be either personally delivered, sent by reputable overnight courier service, sent
by facsimile (with hard copy to follow by regular mail) or mailed by first class mail, return receipt requested, to the recipient
at the address below indicated:

 

Notices to the Employee:

 

Lorraine Yarde

670 Du Fort Avenue

Henderson, NV 89002

Email: Lorraine@rxsafes.com

 

Notices to the Company:

 

Rx Safes, Inc.

170 South Green Valley Parkway, Suite 300

Henderson,
NV 89012

info@rxsafes.com

 

or such other address or to the attention of such other person
as the recipient Party will have specified by prior written notice to the sending Party. Any notice under this Agreement will
be deemed to have been given when so delivered, sent or mailed.

 

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15.     Severability.

 

Whenever
possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable Jaw,
but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law
or rule in any jurisdiction ,such invalidity, illegality or unenforceability will not affect any other provision or any action
in any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.

 

16.     Complete Agreement.

 

This Agreement embodies
the complete agreement and understanding among the Parties and supersedes and preempts any prior understandings, agreements or
representations by or among the Parties, written or oral, which may have related to the subject matter hereof in any way.

 

17.     Counterparts.

 

This Agreement may be executed
in separate counterparts (including by facsimile and electronic signature pages), each of which is deemed to be an original and
all of which taken together constitute one and the same agreement.

 

18.     No Strict Construction.

 

The parties hereto jointly
participated in the negotiation and drafting of this Agreement. The language used in this Agreement will be deemed to be the language
chosen by the parties hereto to express their collective mutual intent, this Agreement will be construed as if drafted jointly
by the parties hereto, and no rule of strict construction will be applied against any Person.

 

19.     Successors and Assigns.

 

This Agreement is intended
to bind and inure to the benefit of and be enforceable by Employee, the Company and their respective heirs, successors and assigns.
Employee may not assign his rights or delegate his duties or obligations hereunder without the prior written consent of the Company.
The Company may assign its rights and obligations hereunder (including without limitation its rights under Section IO), without
the consent of, or notice to, the Employee, to any of the Company's affiliates or any Subsidiary of the Company. In the event of
a Change of Control, the Company will assign this Agreement to the Person that acquires the Company and retains the Employee, in
which case all references to the Company will refer to such assignee.

 

20.     Choice of Law; Exclusive Venue.

 

THIS AGREEMENT, AND
ALL ISSUES AND QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS AGREEMENT, WILL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEVADA, WITHOUT GIVING EFFECT TO ANY CHOICE
OF LAW OR CONFLICT OF LAW RULES OR PROVISIONS {WHETHER OF THE STATE OF NEVADA OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE
APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF DELAWARE. THE PARTIES AGREE THAT ALL DISPUTES, LEGAL
ACTIONS, SUITS AND PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT MUST BE BROUGHT EXCLUSIVELY IN A FEDERAL DISTRICT
COURT LOCATED IN LAS VEGAS, NEVADA OR THE SUPERIOR COURT LOCATED IN LAS VEGAS, NEVADA(COLLECTIVELY THE "DESIGNATED
COURTS"). EACH PARTY HEREBY CONSENTS AND SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE DESIGNATED COURTS. NO LEGAL
ACTION, SUIT OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN ANY OTHER FORUM. EACH PARTY HEREBY IRREVOCABLY
WAIVES ALL CLAIMS OF IMMUNITY FROM JURISDICTION AND ANY OBJECTION WHICH SUCH PARTY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE OF ANY SUIT, ACTION OR PROCEEDING IN ANY DESIGNATED COURT, INCLUDING ANY RIGHT TO OBJECT ON THE BASIS THAT ANY DISPUTE,
ACTION, SUIT OR PROCEEDING BROUGHT IN THE DESIGNATED COURTS HAS BEEN BROUGHT IN AN IMPROPER OR INCONVENIENT FORUM OR VENUE.
EACH OF THE PARTIES ALSO AGREES THAT DELIVERY OF ANY PROCESS, SUMMONS, NOTICE OR DOCUMENT TO A
PARTY HEREOF IN COMPLIANCE WITH SECTION 13 OF THIS AGREEMENT SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY ACTION, SUIT OR
PROCEEDING IN A DESIGNATED COURT WITH RESPECT TO ANY MATTERS TO WHICH THE PARTIES HAVE SUBMITTED TO JURISDICTION AS SET FORTH
ABOVE.

 

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21.     Mutual Waiver of Jury Trial.

 

THE PARTIES EACH WAIVE
THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT
IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY AFFILIATE
OF ANY OTHER SUCH PARTY, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS OR OTHERWISE. THE PARTIES EACH AGREE THAT ANY SUCH
CLAIM OR CAUSE OF ACTION WILL BE TRIED BY A JUDGE WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT
THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION , COUNTERCLAIM OR OTHER PROCEEDING
WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY PROVISION HEREOF. THIS WAIVER
WILL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.

 

22.     Business Days.

 

If any time period for
giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or legal holiday in the state in which the
Company's chief-executive office is located, the time period shall automatically be extended to the business day immediately following
such Saturday, Sunday or legal holiday.

 

23.     Withholding.

 

The
Company and its Subsidiaries will be entitled to deduct or withhold from any amounts owing to Employee any federal, state, local
or foreign withholding taxes, excise tax, or employment taxes ("Taxes") imposed with respect to Employee's compensation
or other payments from the Company or any of its Subsidiaries or Employee's ownership interest in the Company or any of its Subsidiaries
or its parent (including, without limitation, wages, bonuses, dividends, the receipt or exercise of equity options and/or the receipt
or vesting of restricted equity).

 

24.     Assistance in Proceedings.

 

During the Employment Period
and for twelve (12) months thereafter, Employee will reasonably cooperate with the Company and its Subsidiaries in any internal
investigation or administrative, regulatory or judicial proceeding as reasonably requested by the Company (including, without limitation,
Employee being available to the Company and its Subsidiaries upon reasonable notice for interviews and factual investigations,
appearing at the Company's request to give testimony without requiring service of a subpoena or other legal process, volunteering
to the Company and its Subsidiaries all pertinent information and turning over to the Company and its Subsidiaries all relevant
documents which are or may come into Employee's possession, all at times and on schedules that are reasonably consistent with
Employee's other permitted activities and commitments). In the event the Company requires Employee's cooperation in accordance
with this Section 24, the Company will pay Employee a reasonable per diem as determined by the Board and reimburse Employee
for reasonable expenses incurred in connection therewith (including lodging and meals, upon submission of receipts).

 

25.     Amendment and Waiver.

 

The provisions of this
Agreement may be amended or waived only with the prior written consent of the Company and Employee, and no course of conduct or
course of dealing or failure or delay by any Party hereto in enforcing or exercising any of the provisions of this Agreement will
affect the validity, binding effect or enforceability of this Agreement or be deemed to be an implied waiver of any provision of
this Agreement.

 

    	9

    	 

    

 

26.      409A.

 

It is intended that any
amounts payable under this Agreement shall comply with the provisions of Section 409A of the Internal Revenue Code of 1986, as
amended (the "Code"), and this Agreement shall be construed and interpreted consistent with that intent. Employee and
the Company agree to agree to make such reasonable amendments to this Agreement as may be necessary to avoid the imposition of
penalties and additional taxes on Employee under Code Section 409A of the Code. For purposes of Code Section 409A, (i) references
herein to the Employee's "termination of employment" or like references shall refer to the Employee's "separation
from service" with the Company within the meaning of Section 409A of the Code and the Treasury Regulations thereunder and
(ii) each amount payable under this Agreement as a result of the separation of the Employee's service shall constitute a "separate
payment within the meaning of Treasury Regulation §l.409A- 2(b)(2)(iii),and each such payment shall at all times be considered
a separate and distinct payment for all purposes of Code Section 409A. Employee acknowledges and agrees that notwithstanding this
Section 26 or any other provision of this Agreement, the Company is not providing any tax advice with respect to Code Section 409A
or otherwise and is not making any guarantees or other assurances of any kind to Employee with respect to the tax consequences
or treatment of any amounts paid or payable to Employee hereunder.

 

IN WITNESS WHEREOF, the Parties hereto
have executed this Employment Agreement as of the date first written above.

 

		 	/s/ Lorraine Yarde
	On Behalf of Rx Safes, Inc	 	Employee: Lorraine Yarde

  

 

10exhibit_10-1.htm

Exhibit 10.1

 

Check-Cap, LLC

 

2006 UNIT OPTION PLAN

 

  

  

  

 

TABLE OF CONTENTS

 

	
1.

	
Purpose

	
1

	
2.

	
Definitions

	
1

	
3.

	
Administration of the Plan

	
5

	
4.

	
Designation of Optionees

	
8

	
5.

	
Units subject to the plan

	
9

	
6.

	
Term of Option

	
9

	
7.

	
Unit Exercise Price and Consideration

	
9

	
8.

	
Vesting of the Options

	
10

	
9.

	
Exercise of Option; Right as a Member

	
10

	
10.

	
Termination of Employment

	
11

	
11.

	
Adjustments

	
12

	
12.

	
Designation of Options Pursuant to Section 102

	
13

	
13.

	
Trustee

	
14

	
14.

	
Transfer Restrictions

	
15

	
15.

	
Purchase For Investment; Limitations Upon IPO; Representations

	
15

	
16.

	
Distributions

	
16

	
17.

	
Restrictions On Assignability And Sale Of Options/Units

	
16

	
18.

	
Amendment and Termination of the Plan

	
17

	
19.

	
Integration Of Section 102 And Tax Commissioner’s Permit

	
18

	
20.

	
General Provisions

	
18

	
21.

	
Date of Grant

	
19

	
22.

	
Tax Consequences

	
19

	
23.

	
Securities Law and Other Regulatory Compliance

	
19

	
24.

	
Non-Exclusivity of the Plan

	
20

	
25.

	
Inability to Obtain Authority

	
20

	
26.

	
Multiple Agreements

	
20

	
27.

	
Disputes

	
20

 

  

 

  

 

Check-Cap, LLC

2006 UNIT OPTION PLAN

 

This plan, as amended from time to time, shall be known as the Check–Cap, LLC 2006 Unit Option Plan (the "Plan").

	
1.

	
Purpose

The purpose of the Plan is to foster and promote the long-term financial success of the Company and its Subsidiaries and materially increase member value by:

	
  

	
(a)

	
motivating superior performance by means of performance-related incentives;

	
  

	
(b)

	
encouraging and providing for the acquisition of an ownership interest in the Company by Eligible Persons; and

	
  

	
(c)

	
enabling the Company to attract and retain the services of outstanding management team and other qualified and dedicated employees upon whose judgment, interest and special effort the successful conduct of its operations is largely dependent.

 

	
2.

	
Definitions

For purposes of interpreting the Plan and related documents (including the Option Agreement and its appendices), the following definitions shall apply:

	
  

	
(a)

	
"Administrator" - means the Board or the Committee as shall be administering the Plan, in accordance with Section 3 hereof.

 

	
  

	
(b)

	
"Affiliate" - means an entity, which is a Parent or Subsidiary of the Company, direct or indirect.

 

	
  

	
(c)

	
"Applicable Laws" - means the requirements relating to the taxation or administration of employee option plans or grants or exercises of options under the law of the State of Israel with respect to option grants made hereunder to persons subject to taxation by the State of Israel and the laws of the United States, the State of Illinois with respect to option grants made hereunder to persons not subject to taxation by the laws of the State of Israel, any stock exchange or quotation system on which equity interests in the Company are listed or quoted.

 

	
  

	
(d)

	
"Approved 102 Option" - means an Option granted pursuant to Section 102(b) of the Tax Ordinance and held in trust by the Trustee for the benefit of the Optionee.

 

	
  

	
(e)

	
"Board" - means the Board of Directors of the Manager of the Company which functions as the board of the Company.

 

	
  

	
(f)

	
"Cause"- means, (i) conviction of any felony involving moral turpitude or affecting the Company; (ii) any failure (as a result of gross negligence or willful misconduct) to carry out, as an employee of or service provider to the Company or its Affiliates, a reasonable directive of the chief executive officer, the Board or the Optionee’s direct supervisor, which involves the business of the Company or its Affiliates and which was capable of being lawfully performed by Optionee; (iii) embezzlement or theft of funds of the Company or its Affiliates; (iv) any breach of the Optionee’s fiduciary duties or duties of care of the Company; including, without limitation, self-dealing, prohibited disclosure of confidential information of, or relating to, the Company, or engagement in any business competitive to the business of the Company or of its Affiliates; and (v) any conduct (other than conduct in good faith) reasonably determined by the Administrator to be materially detrimental to the Company.

 

  

1

  

 

	
  

	
(g)

	
"Code" - means the United States Internal Revenue Code of 1986, as amended from time to time.

	
  

	
(h)

	
“Committee”  - shall mean a committee of the Board, designated by the Board to administer the Plan.

	
  

	
(i)

	
“Company” – shall mean Check-Cap, LLC, a Delaware limited Liability Company, and any successor thereto.

	
  

	
(j)

	
“Common Units” or “Units” – shall mean the common units of the Company, as may be adjusted pursuant to the Operating Agreement.

	
  

	
(k)

	
“Consultant” – means any person who is engaged by the Company to render consulting or advisory services to any of the Company entities; provided, however, that a consultant must be an individual who is providing or will be providing bona fide services to the Company, with such services (1) not being in connection with the offer or sale of securities in a capital-raising transaction, and (2) not directly or indirectly promoting or maintaining a market for securities of the Company.

	
  

	
(l)

	
“Date of Grant”- shall have the meaning set forth in Section 21 below.

	
  

	
(m)

	
“Director” – means a member of the Board.

	
  

	
(n)

	
“Disability” – means an Optionee’s inability to perform his or her duties with the Company, or any of its affiliates, for a consecutive period of at least 180 days, by reason of any medically determinable physical or mental impairment, as determined by a physician selected by the Optionee and acceptable to the Company.

 

	
  

	
(o)

	
“Effective Date” – shall mean the date on which the Plan is approved by the Board.

	
  

	
(p)

	
"Eligible Person" – shall mean an Employee, a Consultant or a Service Provider.

	
  

	
(q)

	
“Employee”  - shall mean any person, including an officer or Director of the Company or any Affiliate who is employed by the Company or its Affiliate.

	
  

	
(r)

	
“Employment” – shall mean for purposes of Section 10 continuous and regular salaried employment with the Company or a Subsidiary, which shall include (unless the Administrator shall otherwise determine) any period of paid vacation, or any approved leave of absence.

	
  

	
(s)

	
“Exchange Act” – shall mean the Securities Exchange Act of 1934, as now in effect or as hereafter amended, or under any similar law of any other jurisdiction.

	
  

	
(t)

	
“Exercise Price” – shall mean the price for each Unit subject to an Option.

 

  

2

  

 

	
  

	
(u)

	
“Fair Market Value” – means, as of any date, the value of a Unit determined as follows:

If the Units are listed on any established stock exchange or a national market system, including without limitation the Israeli Stock Exchange, The Nasdaq National Market or The Nasdaq Small Cap Market of The Nasdaq Stock Market, their Fair Market Value shall be the closing sales price for such Units (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day prior to the time of determination, as reported in print version of The Wall Street Journal or such other source as the Administrator deems reliable;

If the Units are regularly quoted by a recognized securities dealer but selling prices are not reported, their Fair Market Value shall be the average of the high bid and low asked prices for the Units on the last market trading day prior to the day of determination, or;

In the absence of an established market for the Units, the Fair Market Value thereof shall be determined in good faith by the Administrator.

	
  

	
(v)

	
“IPO” – means the initial public offering of the Company’s Units or interests into which the Units are convertible or for which the Units are exchangeable pursuant to a registration statement filed with and declared effective under the Israeli Securities Law, 1968, or under the United States Securities Act of 1933, as amended, or under any similar law of any other jurisdiction.

 

	
  

	
(w)

	
"Operating Agreement" shall mean the amended and restated Operating Agreement of the Company, dated August 17, 2005, as it may be amended from time to time in accordance with its terms.

	
  

	
(x)

	
“Option” – shall mean the right to purchase the number of Units specified by the Administrator, at a price and for the term fixed by the Administrator in accordance with the Plan and subject to any other limitations and restrictions as this Plan and the Administrator shall impose.

	
  

	
(y)

	
“Option Agreement” – means a written or electronic agreement between the Company and an Optionee evidencing the terms and conditions of an individual Option grant. The Option Agreement shall state, inter alia, the number of Units covered thereby, the dates when it may be exercised (subject to section 8), the Exercise Price and such other terms as the Administrator in its discretion may prescribe. The Option Agreement is subject to the terms and conditions of the Plan.

	
  

	
(z)

	
"Optionee" means an Eligible Person who receives or holds an Option under the Plan.

	
  

	
(aa)

	
"3(i) Options" - means Options granted to Optionees resident in the State of Israel that do not contain such terms as will qualify them under Section 102 of the Tax Ordinance.

 

  

3

  

	
  

	
(bb)

	
"102 Option" – means an Option that the Board intends to be a "102 Option" which shall only be granted to employees  resident in the State of Israel who are not Ten Percent Members, and shall be subject to and construed consistently with the requirements of Section 102 of the Tax Ordinance. The Company shall have no liability to an Optionee, or to any other party, if an Option (or any part thereof), which is intended to be a 102 Option, is not a 102 Option. Approved 102 Options may either be classified as Capital Gain Options ("CGO") or Ordinary Income Options ("OIO").

 

Approved 102 Options elected and designated by the Company to qualify under the capital gain tax treatment in accordance with the provisions of Section 102(b)(2) shall be referred to herein as CGO.

Approved 102 Options elected and designated by the Company to qualify under the ordinary income tax treatment in accordance with the provisions of Section 102(b)(1) shall be referred to herein as OIO.

The Company’s election of the type of Approved 102 Options as CGO or OIO granted to Employees (the "Election") shall be appropriately filed with the Israeli Tax Authorities before the Date of Grant of any Approved 102 Option.

Such Election shall become effective beginning on the date of the first grant of an Approved 102 Option under the Plan and shall remain in effect until at least the end of the calendar year following the year during which the Company first granted Approved 102 Options. The Election shall obligate the Company to grant only the type of Approved 102 Option it has elected, and shall apply to all Approved 102 Options granted during the period indicated herein, all in accordance with the provisions of Section 102(g) of the Tax Ordinance. For the avoidance of doubt, such Election shall not prevent the Company from granting Unapproved 102 Options simultaneously.

 

All Approved 102 Options must be held in trust by a Trustee, as described in Section 13.

For the avoidance of doubt, the designation of Unapproved 102 Options and Approved 102 Options shall be subject to the terms and conditions set forth in Section 102 of the Ordinance and the regulations promulgated thereunder.

With regards to Approved 102 Options, the provisions of the Plan and/or the Option Agreement shall be subject to the provisions of Section 102 and the Tax Assessing Officer’s permit, and the said provisions and permit shall be deemed an integral part of the Plan and of the Option Agreement. Any provision of Section 102 and/or the said permit which is necessary in order to receive and/or to keep any tax benefit pursuant to Section 102, which is not expressly specified in the Plan or the Option Agreement, shall be considered binding upon the Company and the Optionees.

	
  

	
(cc)

	
"Parent" - means any entity (other than the Company) in an unbroken chain of entities ending with the Company if, at the time of granting an Option, each of the entities (other than the Company), owns equity interests representing fifty percent (50%) or more of total combined voting power of all classes of equity in one of the other entities in such chain.

 

	
  

	
(dd)

	
"Securities Law" means the Israeli Securities Law of 1968 as amended, the United States Securities Act of 1933, as amended, or any similar law of any other jurisdiction that is applicable.

 

 

  

4

  

	
  

	
(ee)

	
"Service Provider" - means an Employee, Director, supplier, Office Holders ([“Nose Misra”] - as such term is defined in the Companies Act, 1999, including, inter alia, any other person who is part of the upper management of the Company and who grants managerial services to the Company or an officer) of the Company.

 

	
  

	
(ff)

	
"Subsidiary" - shall mean any entity of which the Company owns directly or indirectly fifty percent (50%) or more of the total combined voting power of all classes of equity of such entity.

	
  

	
(gg)

	
"Successor Company" means any entity into or with which the Company is merged or by which the Company is acquired, pursuant to a Transaction in which the Company is not the surviving entity.

	
  

	
(hh)

	
"Tax Ordinance" - means the Israeli Income Tax Ordinance [New Version]-1961 and the rules and regulations promulgated thereunder as now in effect or as hereafter amended.

 

	
  

	
(ii)

	
"Ten Percent Member" - means a person who owns interests possessing more than ten percent (10%) of the total combined voting power of all classes of equity of the Company or of any of its Affiliates immediately before such Option is granted, and in accordance with Section 32(a) of the Tax Ordinance.

 

	
  

	
(jj)

	
"Transaction" - means (i) merger, acquisition or reorganization of the Company with one or more other entities in which the Company is not the surviving entity or (ii) a sale of all or substantially all of the assets or equity interests the Company.

 

	
  

	
(kk)

	
"Trustee" - means any individual appointed by the Company to serve as a trustee and approved in accordance with the laws of the State of Israel that may be replaced at the discretion of the Administrator.

 

	
  

	
(ll)

	
"Trust Agreement" – means Addendum B to the Israeli Income Tax rules (Tax Relief for Allocation of Units to Employees 2003), as now in effect or as hereafter amended.

 

	
  

	
(mm)

	
"Vesting Dates" - means, with respect to any Option, the date as of which the Optionee shall be entitled to exercise such Option, as set forth in Section 8 of the Plan.

 

	
  

	
(nn)

	
"Unapproved 102 Option" - means an Option granted pursuant to Section 102(c) of the Tax Ordinance and not held in trust by a Trustee.

 

	
3.

	
Administration of the Plan

	
  

	
(a)

	
The Plan shall be administered by the Administrator. The Administrator shall have the authority in its sole discretion, subject and not inconsistent with the express provisions of the Plan, to administer the Plan and to exercise all the powers and authorities specifically granted to it under the Plan as necessary and advisable in the administration of the Plan.

	
  

	
(b)

	
Provided that the Board is entitled by law and pursuant to the Operating Agreement to delegate all and any of its powers and authority granted to it under the plan to a Committee, the Board may do so in a manner consistent therewith and the Committee shall be the Administrator.

 

  

5

  

 

	
  

	
(c)

	
The Administrator shall have the responsibility of construing and interpreting the Plan and of establishing and amending such rules and regulations, as it deems necessary or desirable for the proper administration of the Plan.  The Administrator shall keep records of its meetings and shall make such rules and regulations for the conduct of its business, as it shall deem advisable.

 

	
  

	
(e)

	
Subject to the provi­sions of the Plan, the Applicable Laws and, the Operating Agreement, and subject to the approval of any relevant authorities, the Administrator shall have the authority, in its discretion:

	
  

	
i.

	
to construe and interpret the terms of the Plan and any Options granted pursuant to the Plan;

 

	
  

	
ii.

	
(i)

	
to designate the Eligible Persons to whom Options may from time to time be granted hereunder;

 

	
  

	
iii.

	
(ii)

	
determine, on the date of grant, the terms and provisions of the respective Option Agreements (which need not be identical), including, but not limited to, the number of Options to be granted to each Optionee, the number of Units to be covered by each Option, provisions concerning the time and extent to which the Options may be exercised (but not beyond the Option expiration date), and the nature and duration of restrictions as to the transferability, or restrictions constituting substantial risk of forfeiture upon occurrence of certain events;

 

	
  

	
iv.

	
(iii)

	
to prescribe forms of agreement for use under the Plan;

 

	
  

	
v.

	
(iv)

	
to determine the terms of any Option granted hereunder;

 

	
  

	
vi.

	
designate the type of Options;

 

	
  

	
vii.

	
(vi)

	
to determine the Exercise Price of any Option granted hereunder;

 

	
  

	
viii.

	
to determine the Fair Market Value of Units, subject to the terms hereof;

 

	
  

	
ix.

	
cancel or suspend Options, as necessary;

 

	
  

	

x.

	

(viii)

	
to prescribe, amend and rescind the Plan, provided that any such amendment that would adversely effect the Optionee’s rights under an outstanding Option shall not apply to such outstanding Option without the Optionee’s written consent.

 

	
  

	
xi.

	
(ix)

	
to take all other action and make all other determinations necessary for the administration of the Plan.

 

  

6

  

	
  

	
(f)

	
Any decision or action taken or to be taken by the Administrator, arising out of or in connection with the construction, administration, interpretation and effect of the Plan, shall, to the maximum extent permitted by Applicable Law, be within its absolute discretion (except as otherwise specifically provided herein) and shall be conclusive and binding upon all Optionees and any person claiming under or through any Optionee.

	
  

	
(g)

	
No individual constituent of the Administrator shall be liable for any action taken or determination made in good faith with respect to the Plan or any Option granted hereunder.

 

  

7

  

 

	
  

	
(h)

	
Any individual constituent of the Administrator shall be eligible to receive Options under the Plan while serving as a constituent member of the Administrator, unless otherwise specified herein. No person shall be eligible to be a member of the Administrator if that person’s membership would prevent the Plan from complying with exemptions provided within the Applicable Laws.

	
4.

	
Designation of Optionees

	
  

	
(a)

	
Options granted under this Plan may or may not contain such terms as will qualify the Options as, 102 Options or as 3(i) Options. Options granted under this Plan may or may not contain such terms as will qualify the Options as qualified options under Applicable Laws ("Qualified Options").

 

	
  

	
(b)

	
Each Option, granted pursuant to the Plan, shall be evidenced by an Option Agreement, in such form as the Administrator shall from time to time approve. Each Option Agreement shall state, among other matters, the number of Units to which the Option relates, the type of Option granted thereunder (whether an CGO, OIO, Unapproved 102 Option or a 3(i) Option), the Vesting Dates, the Exercise Price, the expiration date and such other terms and conditions as the Administrator may prescribe, provided that they are consistent with the terms of this Plan and the Administrator's discretion hereunder. The written agreement shall be delivered to the Optionee and shall incorporate the terms of the Plan by reference and specify the terms and conditions thereof and any rules applicable thereto (each, an "Option Agreement").

 

	
  

	
(c)

	
The persons eligible for participation in the Plan as Optionees shall include any Employees and/or Consultants and/or Service Providers; provided, however, that options qualified under Section 102 of the Tax Ordinance shall be granted only to Employees of the Company who are not Ten Percent Owners of the Company.

	
  

	
(d)

	
Neither this Plan nor any Agreement nor any offer of Options to an Optionee shall impose any obligation on the Company to continue to employ or to engage the services of any Optionee, and nothing in the Plan or in any Option granted pursuant hereto shall give any Optionee any right to continue his employment or service with the Company or restrict the right of the Company to terminate such employment or services at any time. Further, the Company and each Subsidiary expressly reserves the right at any time to dismiss an Optionee free from any liability, or any claim under the Plan, except as provided herein or in any Option Agreement.

 

	
  

	
(e)

	
The grant of an Option to an Optionee hereunder shall neither entitle such Optionee to participate, nor disqualify him from participating, in any other grant of Options pursuant to this Plan or any other incentive or Unit option plan of the Company or any of its Affiliates

 

	
  

	
(f)

	
Anything in the Plan to the contrary notwithstanding, all grants of Options to Directors and officers shall be authorized and implemented in accordance with the provisions of Applicable Law and the Operating Agreement.

 

  

8

  

 

	
5.

	
Units subject to the plan

	
  

	
(a)

	
Maximum Number of Units The Company has reserved a total of 330.6417. Common Units which represented 10% of its equity prior to the issuance of its series Units and, as of the date hereof, represents 8.3006% of the Company [post Series B] Any Units which remain unissued and which are not subject to the outstanding Options at the termination of the Plan shall cease to be reserved for the purpose of the Plan, but until termination of the Plan the Company shall at all times reserve sufficient number of Units to meet the requirements of the Plan. Should any Option for any reason expire or be canceled prior to its exercise or relinquishment in full, the Units subject to such Option may again be subjected to an Option under the Plan or under the Company’s other Unit option plans subsequently adopted by the Company, provided, however, that Units that have actually been issued under the Plan shall not be returned to the Plan and shall not become available for future distribution under the Plan.

	
  

	
(b)

	
Units Available for Issuance. Units may be made available from the authorized but unissued Units of the Company or from Units not reserved for some other purpose. In addition, if any Option in respect of Units is canceled or forfeited for any reason without delivery of Units, the Units subject to such Option shall thereafter again be available for award pursuant to the Plan.

 

	
6.

	
Term of Option

If not previously exercised, each Option shall expire upon the tenth (10th) anniversary  of the date of the grant thereof or, upon the earlier termination of the Optionee's Employment (or, if applicable, on the day following the last day on which such Option is exercisable under Section 10 below), provided that the Administrator may establish a shorter term for an Option at the time of the grant of such Option.

	
7.

	
Unit Exercise Price and Consideration

	
  

	
(a)

	
The Exercise Price of each Unit subject to an Option shall be determined, by the Administrator; provided, however that in no event will such Exercise Price be less than 100% of the Fair Market Value per Unit on the date of grant.

	
  

	
(b)

	
Each Option Agreement will contain the Exercise Price determined for each Option covered thereby.

	
  

	
(c)

	
The total consideration to be paid for the Units to be issued upon exercise of an Option, including the method of payment, shall be determined by the Administrator and may consist entirely of (1) cash, (2) check, or (3) any combination of the foregoing methods of payment.  In making its determination as to the type of consideration to accept, the Administrator shall consider if acceptance of such consideration may be reasonably expected to benefit the Company.

	
  

	
(d)

	
The Exercise Price shall be denominated in the currency of the primary economic environment of, either the Company or the Optionee (that is the functional currency of the Company or the currency in which the Optionee is paid), as determined by the Administrator.

 

  

9

  

 

	
  

	
(e)

	
The proceeds received by the Company from the issuance of Units subject to the Options will be added to the general funds of the Company and used for any lawful business purposes.

	
8.

	
Vesting of the Options

	
  

	
(a)

	
Subject to the provisions of the Plan, each Option shall vest and become exercisable commencing on the Vesting Date(s) thereof, as determined by the Administrator, for the number of Units as shall be provided in the Option Agreement. However, no Option shall be exercisable after its expiration date.

	
  

	
(b)

	
An Option may be subject to such other terms and conditions on the time or times when it may be exercised, as the Administrator may deem appropriate. The vesting provisions of individual Options may vary.

	
9.

	
Exercise of Option; Right as a Member

	
  

	
(a)

	
Options shall be exercised by the Optionee by giving written notice to the Company, in such form and method as may be determined by the Company and when applicable, by the Trustee in accordance with the requirements of Section 102 of the Tax Ordinance, which exercise shall be effective upon receipt of such notice by the Company and the payment of the Exercise Price times the number of Units being purchased at the Company’s principal office. The notice shall specify the number of Units with respect to which the Option is being exercised.

	
  

	
(b)

	
The Options may be exercised by the Optionee in whole at any time or in part from time to time, to the extent that the Options become vested and exercisable, prior to the Expiration Date, and provided that, subject to the provisions of Section 10 below, the Optionee is employed by or providing services to the Company or any of its Affiliates, at all times during the period beginning with the granting of the Option and ending upon the date of exercise.

	
  

	
(c)

	
Units issued upon exercise of an Option shall be issued in the name of the Optionee. Prior to exercise and until the issuance (as evidenced by the appropriate entry on the books of the Company) of the stock certificate evidencing such Units, an Optionee, as such, shall have no right to vote or receive distribution or any other rights of a Member.

	
  

	
(d)

	
An Option may not be exercised unless, at the time the Optionee gives notice of exercise to the Company, the Optionee includes with such notice payment in cash or by bank check of all withholding taxes due, if any, on account of its acquired Units under the Option or gives other assurance satisfactory to the Administrator and the Trustee, if applicable, of the payment of those withholding taxes.

	
  

	
(e)

	
Units shall not be issued pursuant to the exercise of an Option unless the exercise of such Option, the method of payment and the issuance and delivery of such Units shall comply with Applicable Laws.

 

  

10

  

 

	
  

	
(f)

	
Upon their issuance, the Units shall carry equal voting rights on all matters where such vote is permitted by applicable laws of the jurisdiction of organization of the Company and subject to the terms of the Operating Agreement with respect to the voting rights of other Common Units issued by the Company, provided however, that the Company, at its sole discretion, may require that, until the earlier to occur of the consummation of an IPO by the Company or a successor or, the Tenth (10th) anniversary of the Date of Grant any Units issued upon exercise of Options (and securities of the Company issued with respect thereto) shall be voted by an irrevocable proxy (the "Proxy") in the same manner as the votes of the majority of other Common Members of the Company present and voting at the applicable meeting or acting by written consent if permitted, such Proxy to be assigned to the person or persons designated by the Administrator and to provide for the power of such designated person(s) to act, on its behalf, with respect to any and all aspects of the Optionee’s Unit holdings in the Company. The Proxy may be contained in the Option Agreement of an Optionee or otherwise as the Administrator determines. If contained in the Option Agreement, no further document shall be required to implement such Proxy, and the signature of the Optionee on the Option Agreement shall indicate approval of the Proxy thereby granted. Such person or persons designated by the Board shall be indemnified and held harmless by the Company against any cost or expense (including counsel fees) reasonably incurred by him/her, or any liability (including any sum paid in settlement of a claim with the approval of the Company) arising out of any act or omission to act in connection with the voting of such Proxy unless arising out of such member's own fraud or bad faith, to the extent permitted by Applicable Law. Such indemnification shall be in addition to any rights of indemnification the person(s) may have as a director or otherwise under the Company's Operating Agreement or organizational documents, any agreement, any vote of Members or disinterested directors, insurance policy or otherwise. Without derogating from the above, with respect to Units issuable upon exercise of Approved 102 Options, such Units shall be voted in accordance with the provisions of Section 102 and of any rules, regulations or orders promulgated thereunder.

 

	
  

	
(g)

	
To avoid doubt, the Optionees shall not have any of the rights or privileges of Members of the Company in respect of any Units purchasable upon the exercise of any Options, until registration of the Optionee as holder of such Units in the Company’s records upon exercise of the Options in accordance with the provisions of the Plan and the Options.

	
  

	
(h)

	
Subject to the provisions of Section 20(c), if any law or regulation requires the Company to take any action with respect to the Units specified in such notice of exercise before the issuance thereof, then the date of their issuance shall be extended for the period necessary to take such action.

	
  

	
(i)

	
Exercise of an Option in any manner shall result in a decrease in the number of Units and the Options thereafter available, both for purposes of the Plan and for exercise under the Option, by the number of Units as to which the Option is exercised.

	
10.

	
Termination of Employment

	
  

	
(a)

	
Unless the Administrator shall otherwise determine at or after grant, in the event of termination of Optionee's Employment with the Company other than for Cause, Disability or death, or if applicable, the termination of services rendered by the Optionee to the Company other than for Cause, Disability or death, all Options granted to that Optionee, which are vested and exercisable at the time of such termination, may, unless earlier terminated in accordance with the provisions of the Plan or the Option Agreement, be exercised within three (3) months after the date of such termination (or within such shorter time period, not less than thirty (30) days, or within such longer time period, not exceeding five (5) years after the termination date as may be determined by the Administrator. but in any event, no later than the expiration date of the Options. If, on the date of termination, the Units subject to the Option have not vested in their entirety, any Units covered by the unvested portion of the Option shall expire and be of no further force and effect and revert to the Plan. To the extent the vested portion of the Option is not so exercised within the time specified herein, such unexercised vested portion of the Option shall expire and be of no further force and effect, and the Units covered by such unexercised vested portion of the Option shall revert to the Plan.  For the purposes of this section, termination of employment or engagement shall mean the effective date of the termination.

 

  

11

  

 

	
  

	
(b)

	
If the Optionee’s Employment is terminated because of Optionee's death or Disability (or the Optionee dies within three (3) months after a Optionee's termination other than for Cause), then Optionee's Options may be exercised, only to the extent that such Options are exercisable by Optionee termination date or within twelve (12) months after the Optionee termination date or as otherwise determined by the Administrator. Such Options must be exercised by Optionee (or Optionee's legal representative or authorized assignee), if at all, as to all or some of the then vested Units calculated as of the termination date or such other date determined by the Administrator, within twelve (12) months after the termination date but in any event no later than the expiration date of the Options. If, on the date of termination, there are Options, which are not entirely vested, the Units covered by the unvested portion of the Options shall revert to the Plan. If the Option is not so exercised within the time specified herein, the Option shall terminate, and the Units covered by such Option shall revert to the Plan.

 

	
  

	
(c)

	
In the event of termination of Optionee's employment with the Company for Cause, or if applicable, the termination of services rendered by the Optionee to the Company for Cause, all outstanding Options granted to such Optionee (whether vested or not) shall, to the extent not theretofore exercised, immediately expire and shall be of no further force and effect as of the date of such termination, unless otherwise determined by the Administrator.

	
  

	
(d)

	
An optionee shall not be deemed to have been terminated by the Company or an Affiliate in the case of (i) any leave of absence approved by the Company or (ii) transfers between locations of the Company or between Affiliates of the Company, or any successor thereof.

	
11.

	
Adjustments

	
  

	
(a)

	
Changes in Capitalization Subject to the terms of the Operating Agreement, the number of Units covered by each outstanding Option, the number of Units which have been reserved for issuance under the Plan but as to which no Options have yet been granted or which have been returned to the Plan upon cancellation or expiration of Options, as well as the Exercise Price per Unit of Units covered by each such outstanding Option, shall be proportionately adjusted for any increase or decrease in the number of issued Units resulting from a Unit split, reverse Unit split, Unit dividend, combination or reclassification of the Units, or any other increase or decrease in the number of issued Units without investment of cash. Such adjustment shall be made by the Administrator, whose determination in that respect shall be final, binding and conclusive.  Except as expressly provided herein, no issuance by the Company of equity of any class, or securities convertible into equity of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number of Units subject to an Option or the Exercise Price specified in an Option. If the Options or the Units issued upon the exercise of such Options will be deposited with a Trustee, as determined by the Administrator, all of the Units formed by these adjustments also will be deposited with the Trustee in the same terms and conditions as the original Options or Units.

 

	
  

	
(b)

	
Dissolution or Liquidation In the event of a dissolution or liquidation of the Company (either voluntary or involuntary) (the "Event"), the Administrator shall notify each Optionee as soon as practicable prior to the effective date of such Event. The Administrator in its sole discretion may allow the exercise of any or all outstanding Options, whether or not vested, within a reasonable period of time prior to and in connection with the Event and subject to the provisions of the Applicable Laws. To the extent it has not been previously exercised, an Option will terminate immediately prior to the Event.

 

  

12

  

 

	
  

	
(c)

	
Merger, Acquisition, Units’ sale, Assets’ Sale

 

	
  

	
i.

	
In the event of a merger or consolidation of the Company with or into another entity resulting in such other entity being the surviving entity, an acquisition of all or substantially all of the outstanding capital of the Company, or the sale of substantially all of the assets of the Company (each such event, a "Transaction"), the Company shall send each Optionee notice of such Transaction not less than thirty (30) days prior to the closing of such Transaction.  The Optionee shall at that time be given the opportunity to exercise the Optionee's Option in connection with the Transaction and to receive in the Transaction such consideration as the holders of Common Units receive in the Transaction and may have the opportunity to retain his Option from the Company or may receive a substitute option from the surviving company, if any.

 

	
  

	
ii.

	
Anything herein to the contrary notwithstanding, if a Transaction shall occur prior to the consummation of an IPO, then each Optionee shall be obliged to sell or exchange, as the case may be, any Units such Optionee purchased under the Plan, in accordance with the instructions of the Board, at its sole and absolute discretion, in connection with the Transaction, and in the same terms as shall be applicable to all the Common Members of the Company.

 

	
12.

	
Designation of Options Pursuant to Section 102

	
  

	
(a)

	
The Administrator may designate Options pursuant to Section 102 as Unapproved 102 Options or as Approved 102 Options.

 

	
  

	
(b)

	
The grant of an Approved 102 Option under the Plan shall be conditioned upon the approval of the Plan by the Israeli Tax Authorities.

 

	
  

	
(c)

	
Approved 102 Options may be classified as either Capital Gain Options or Ordinary Income Options.

 

	
  

	
(d)

	
Each Option Agreement shall state, inter alia, the type of Option granted thereunder (whether a CGO, OIO, Unapproved 102 Option or a 3(i) Option), the vesting provisions and the Exercise Price.

 

	
  

	
(e)

	
No Approved 102 Options may be granted under this Plan to any Employee, unless and until, the Company’s election of the type of Approved 102 Options as CGO or OIO granted to Employees (the "Election"), shall be appropriately filed with the Israeli Tax Authorities at least thirty (30) days before the first Date of Grant of an Approved 102 Option under this Plan. Such Election shall become effective beginning the first Date of Grant of an Approved 102 Option under the Plan and shall remain in effect until at least the end of the year following the year during which the Company first granted Approved 102 Options. The Election shall obligate the Company to grant only the type of Approved 102 Option it has elected, and shall apply to all Approved 102 Options granted during the period indicated herein, all in accordance with the provisions of Section 102(g) of the Tax Ordinance, as now in effect or as hereafter amended. For the avoidance of doubt, such Election shall not prevent, subject to the Board’s sole discretion, the Company from simultaneously (i) granting Unapproved 102 Options; or (ii) 3(i) Options.

 

	
  

	
(f)

	
All Approved 102 Options must be held in trust by a Trustee, as described in Section 13 below.

 

  

13

  

 

	
  

	
(g)

	
For the avoidance of doubt, the designation of Unapproved 102 Options and Approved 102 Options shall be subject to the terms and conditions set forth in Section 102 of the Tax Ordinance and regulations, rules, orders or procedures promulgated thereunder as now in effect or as hereafter amended.

 

	
  

	
(h)

	
With regard to Approved 102 Options, the provisions of the Plan and the Option Agreement shall be subject to the provisions of Section 102 and the Tax Assessing Officer’s permit, and the said provisions and permit shall be deemed an integral part of the Plan and of the Option Agreement. Any provision of Section 102 and/or the said permit which is necessary in order to receive and/or to keep any tax benefit pursuant to Section 102, which is not expressly specified in the Plan or the Option Agreement, shall be considered binding upon the Company and the Optionees.

	
13.

	
Trustee

	
  

	
(a)

	
The Administrator may choose to deposit any or all Options granted pursuant to the Plan with a trustee (the "Trustee"). In such event, the Trustee shall hold such Options, and any Units issued upon the exercise of any of such Options, in trust pursuant to the Company's instructions from time to time. The Trustee shall be entitled to make such provisions and take such steps as it may deem necessary or appropriate for the withholding of all taxes required by law to be withheld with respect to the exercise of the Options or their sale to a third party. The Company shall deliver the Trustee all the necessary information required by him. The Trustee shall be exempt from any liability with respect to any action or decision duly taken in its/his capacity as Trustee.

	
  

	
(b)

	
Anything herein to the contrary notwithstanding, Approved 102 Options granted under the Plan and/or all Units allocated or issued upon exercise of such Approved 102 Options and/or all other interests in the Company received subsequently following any realization of rights in connection with such Approved 102 Options or Units and all rights attached to Units described above or Approved 102 Options, shall be allocated or issued to the Trustee and held for the benefit of the Optionee for such period of time as required by Section 102 or any regulations, rules, orders or procedures promulgated there under as now in effect or as hereafter amended (the "Restricted Period Per Section 102"). All of the rights attached to Units issued upon exercise of Approved 102 Options, including without limitation distributions in respect of the Units, shall be subject to the same tax treatment as the treatment to which such Options are subject. In case the requirements pursuant to Section 102 for an Approved 102 Options are not met, then the Approved 102 Options may be regarded as Unapproved 102 Options, all in accordance with the provisions of Section 102 and regulations, rules, orders or procedures promulgated there under as now in effect or as hereafter amended.

	
  

	
(c)

	
Notwithstanding anything to the contrary, the Trustee shall not enter into any transaction or take any action with respect to Approved 102 Options or Units issued upon exercise thereof, will not transfer, assign, release, pledge, mortgage voluntarily, or grant in connection therewith any proxy (except as provided for in Section 9(f) hereof) or assignment deed, whether immediately effective or effective at a future date, other than by will or by operation of law, until after the full payment of the Optionee’s tax liabilities arising from the grant of such Options or their exercise or release or transfer by the Trustee or after guarantying the payment of said taxes. If such Options or Units have been transferred by will or by operation of law, the provisions of Section 102 will apply with respect to the heirs or the transferees of the Optionee or Member, as the case may be.

  

14

  

	
  

	
(d)

	
Upon receipt of an Approved 102 Option, the Optionee will sign an undertaking to release the Trustee from any liability in respect of any action or decision duly taken and bona fide executed in relation with the Plan, or any Approved 102 Option or Unit held, released or transferred by the Trustee, in accordance with the terms of Section 102.

	
  

	
(f)

	
Subject to the provisions of Section 102 of the Tax Ordinance and any Rules promulgated there under as now in effect or as hereafter amended, during the Restricted Period Per Section 102 an Optionee may not release the Approved 102 Options or Shares issued upon exercise thereof from trust or sell such Options or Shares while they are held by the Trustee. At any time thereafter each Optionee may require (but shall not be obligated to require) the Trustee to sell upon Optionee's direction, or transfer to the Optionee, any Approved 102 Options or Shares issued pursuant to the exercise of such Approved 102 Options, provided that (1) such transfer is in compliance with all applicable securities laws, and (2) all applicable tax due pursuant to such a sale or transfer has been paid in accordance with Section 102 of the Tax Ordinance and the Trustee has received an acknowledgment from the Israeli Tax Authorities that the Optionee has paid any applicable tax due pursuant to the Tax Ordinance. Notwithstanding the above, if any such sale or release occurs during the Restricted Period Per Section 102, the sanctions under Section 102 of the Tax Ordinance and under any Rules promulgated there under as now in effect or as hereafter amended, shall apply to and shall be borne by such Optionee.

	
14.

	
Transfer Restrictions

Until the IPO, the sale or the transfer of the Units issued under this Plan and following the exercise of the Option, shall be subject to any and all restrictions on transfer applicable to Common Units in particular or Units in general issued by the Company.

 

	
15.

	
Purchase For Investment; Limitations Upon IPO; Representations

	
  

	
(a)

	
The Company’s obligation to issue or allocate Units upon exercise of an Option granted under the Plan is expressly conditioned upon: (a) the Company’s completion of any registration or other qualifications of such Units under all applicable laws, rules and regulations or (b) representations and undertakings by the Optionee (or his legal representative, heir or legatee, in the event of the Optionee’s death) to assure that the sale of the Units complies with any registration exemption requirements which the Company in its sole discretion shall deem necessary or advisable. Such required representations and undertakings may include representations and agreements that such Optionee (or his legal representative, heir, or legatee) is purchasing such Units for investment and not with any present intention of selling or otherwise disposing thereof.

	
  

	
(b)

	
The Optionee acknowledges that in the event that the Company’s Units or interests into which the Units are exchanged shall be registered for trading in any public market, Optionee’s rights to sell the Units may be subject to certain limitations (including a lock-up period), as will be requested by the Company or its underwriters, and the Optionee and his heirs or legal representatives unconditionally agree and accept any such limitations upon accepting any Options granted under this Plan.

	
  

	
(c)

	
If any Units shall be registered under the United States Securities Act of 1933, no public offering otherwise than on a national securities exchange (as defined in the United States Securities Exchange Act of 1934, as amended) or other securities market of any Units shall be made by the Optionee (or any other person) under such circumstances that he or she (or such other person) may be deemed an underwriter, as defined in the United States Securities Act of 1933.

 

  

15

  

 

	
  

	
(d)

	
Upon the grant of Options to an Optionee or the issuance of Units upon the exercise thereof, the Company shall obtain from such person the representations and undertakings as follows:

	
  

	
(i)

	
That the Optionee is familiar with the Company, its activity and its financial and commercial forecast, and that the Optionee knows that there is no certainty that the exercise of the Options will be financially worthwhile. The Optionee hereby undertakes not to make any claim against the Company or any of its Directors, Officers, Employees, Members, agents or advisors if it emerges, at the time of exercising the Options, that the Optionee’s investment in the Company‘s Units was not worthwhile, for any reason whatsoever.

	
  

	
(ii)

	
That the Optionee knows that his rights regarding the Options and the Units are subject, for all intents and purposes, to the terms of the Company’s Operating Agreement.

	
  

	
(iii)

	
That the Optionee knows that in addition to the allocations set forth above, the Company has allocated and/or is entitled to allocate Options and Units to other persons, and the Optionee shall have no claim regarding such allocations, their quantity, the relationship among them and between them and the Members of the Company, exercising of the option or any matter related to or stemming from them.

	
  

	
(iv)

	
That the Optionee knows that neither the Plan nor the grant of an Option or Units thereunder shall impose any obligation on the Company to continue the engagement of the Optionee, and nothing in the Plan or in any Option or Units granted pursuant thereto shall confer upon any Optionee any right to continue being engaged or employed by the Company, or restrict the right of the Company to terminate such engagement or employment at any time.

	
  

	
(v)

	
As a condition to the exercise of an Option, the Administrator may require the person exercising such Option to represent and warrant at the time of such exercise that the Units are being purchased only for investment and without any present intention to sell or distribute such Units if, in the opinion of counsel for the Company, such a representation is required.

	
16.

	
Distributions

With respect to all Units (but excluding, for avoidance of any doubt, any unexercised Options) allocated or issued upon the exercise of Options purchased by the Optionee and held by the Optionee or by the Trustee, as the case may be, the Optionee shall be entitled to receive distributions in accordance with the quantity of such Units, subject to the provisions of the Operating Agreement and subject to any applicable taxation on distribution of dividends, and, when applicable, subject to the provisions of Section 102 (if applicable to such Optionee) and the rules, regulations or orders promulgated thereunder.

	
  

	 

	
17.

	
Restrictions On Assignability And Sale Of Options/Units

	
  

	
(a)

	
No Option or any right with respect thereto, purchasable hereunder, whether fully paid or not, shall be assignable, transferable or given as collateral or any right with respect to it given to any third party whatsoever, except as specifically allowed under the Plan and the Operating Agreement. During the lifetime of the Optionee each and all of such Optionee's rights to purchase Units hereunder shall be exercisable only by the Optionee.

 

  

16

  

 

Any such action made directly or indirectly, for an immediate validation or for a future one, shall be void.

	
  

	
(b)

	
As long as Options and/or Units are held by the Trustee on behalf of the Optionee, all rights of the Optionee over the Units are personal, can not be transferred, assigned, pledged or mortgaged, other than by will or pursuant to the laws of descent and distribution.

	
  

	
(c)

	
Unless otherwise determined by the Administrator, following an IPO, an Optionee shall not have the right to effect a sale of Units issued upon the exercise of an Option during the period of any post-IPO lock-up period that the Administrator agrees will be applicable to Optionees or persons holding equity instruments as a result of exercising Options.

	
18.

	
Amendment and Termination of the Plan

	
  

	
(a)

	
The Plan was adopted by the Board of Directors of the Company on ______________ 2006.  The number of Units for which Options are issuable pursuant to the Plan may only be changed in accordance with the Operating Agreement.

	
  

	
(b)

	
The Board may, at any time and from time to time, terminate, alter, adjust, suspend or amend the Plan in any respect, except that if at any time the approval of the Members of the Company is required pursuant to the Israeli Companies Law, 1999, under Section 57 or the regulations promulgated thereunder, the Board may not effect such modification or amendment without such approval. In no event may any action of the Company adversely alter or impair the rights of an Optionee, without such Optionee’s consent, under any Option previously granted to such Optionee.

	
  

	
(c)

	
Notwithstanding Subsection 18(b) above, no amendment, alteration, suspension or termination of the Plan shall impair the rights of any Optionee, unless mutually agreed otherwise between the Optionee and the Company, which agreement must be in writing and signed by the Optionee and the Company. Termination of the Plan shall not affect the Administrator's ability to exercise the powers granted to it hereunder with respect to Options granted under the Plan prior to the date of such termination.

	
  

	
(d)

	
The Plan shall become effective upon its adoption by the Board. It shall continue in effect for a term of ten (10) years after the earlier of its adoption by the Board, unless sooner terminated by the Board.

 

  

17

  

 

	
19.

	
Integration Of Section 102 And Tax Commissioner’s Permit

	
  

	
(a)

	
With regard to Approved 102 Options, the provisions of the Plan and/or any Option Agreement for Approved 102 Options shall be subject to the provisions of Section 102 and the Income Tax Commissioner’s permit, and the said provisions and permit shall be deemed an integral part of the Plan and of the Option Agreement.

	
  

	
(b)

	
Any provision of Section 102 and/or the said permit which is necessary in order to receive and/or to keep any tax benefit pursuant to Section 102, which is not expressly specified in the Plan or the Option Agreement, shall be considered binding upon the Company and the Optionees holding such Options.

	
20.

	
General Provisions

	
  

	
(a)

	
Withholding. The Company shall have the right to deduct from all amounts paid to an Optionee in cash (whether under this Plan or otherwise) any taxes required by law to be withheld in respect of Options under this Plan. In the case of any Option satisfied in the form of Units, no Units shall be issued unless and until arrangements satisfactory to the Administrator shall have been made to satisfy any withholding tax obligations applicable with respect to such Option. Without limiting the generality of the foregoing and subject to such terms and conditions as the Administrator may impose, the Company shall have the right to retain, or the Administrator may, subject to such terms and conditions as it may establish from time to time, permit Optionees to elect to tender, Units (including Units issuable in respect of an Option) to satisfy, in whole or in part, the amount required to be withheld.

	
  

	
(b)

	
The Company may place a legend on each Unit certificate to the effect that such Units were acquired pursuant to an investment representation and are subject to limitations on offers, transfers and sales as the case may be and such other legends as may be specified in the Operating Agreement.

	
  

	
(c)

	
Compliance with Legal and Exchange Requirements. The Plan, the granting and exercising of Options thereunder, and the other obligations of the Company under the Plan, shall be subject to all Applicable Laws, rules, and regulations, and to such approvals by any regulatory or governmental agency as may be required.  The Company shall not be obligated by virtue of any provision of the Plan to recognize the exercise of any Option or to otherwise sell or issue Units in violation of any such laws, rules, or regulations; and any postponement of the exercise or settlement of any Option under this provision shall not extend the term of such Options, and neither the Company nor its directors or officers shall have any obligation or liability to the Optionee with respect to any Option (or Units issuable thereunder) that shall lapse because of such postponement.

	
  

	
(d)

	
Gender and Number. Except when otherwise indicated by the context, words in the masculine gender used in the Plan shall include the feminine gender, the singular shall include the plural, and the plural shall include the singular.

 

  

18

  

 

	
  

	
(e)

	
Governing Law. The validity, construction, interpretation, administration and effect of the Plan and any rules, regulations and actions relating to the Plan will be governed by and construed exclusively in accordance with the laws of the State of Illinois, notwithstanding the conflicts of laws principles of any jurisdictions.  The Plan and all instruments issued thereunder or in connection therewith any Affiliates and/or Subsidiaries, shall be governed by, and interpreted in accordance with, the applicable laws with in the country of organization of the Affiliate and/or Subsidiary or the laws of any jurisdiction to which persons receiving Options employees under the Plan are subject.

	
21.

	
Date of Grant

Subject to Applicable Laws, the Date of Grant of an Option shall, for all purposes, be the date on which the Administrator makes the determination granting such Option.

	
22.

	
Tax Consequences

	
  

	
Any tax consequences arising from the grant or exercise of any Option or from the disposition of Units or from any other event or act (whether of the Optionee or of the Company or of its Trustee) hereunder, shall be borne solely by the Optionee. The Company and/or the Trustee shall withhold taxes according to the requirements under the Applicable Laws, rules, and regulations, including withholding taxes at source. Furthermore, such Optionee shall agree to indemnify the Company that employs the Optionee and/or the Trustee, and/or the Company’s Members and/or directors and/or officers if applicable, and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Optionee, provided that they acted in due care. Except as otherwise required by law, the Company shall not be obligated to honor the exercise of any Option by or on behalf of an Optionee until all tax consequences (if any) arising from the exercise of such Options are resolved in a manner reasonably acceptable to the Company.

	
23.

	
Securities Law and Other Regulatory Compliance

 

This Plan is intended to comply with the Applicable Law. Any provision of this Plan, which is inconsistent with the Applicable Law shall, without further act or amendment by the Company or the Administrator, be reformed to comply with the requirements of Applicable Law. An Option will not be effective unless such Option is in compliance with all Applicable Laws as applicable to the Company with respect to such Optionee as they are in effect on the date of grant of the Option and also on the date of exercise or other issuance. Notwithstanding any other provision in this Plan, the Company will have no obligation to issue or deliver certificates for Units under this Plan prior to (i) obtaining any approvals from governmental agencies that the Company determines are necessary or advisable, and/or (ii) compliance with any exemption, completion of any registration or other qualification of such Units under any applicable laws or ruling of any governmental body that the Company determines to be necessary or advisable. The Company will be under no obligation to register the Units with the Securities and Exchange Commission or to effect compliance with the exemption, registration, qualification or listing requirements of any state securities laws, stock exchange or automated quotation system, and the Company will have no liability for any inability or failure to do so.

 

  

19

  

 

	
24.

	
Non-Exclusivity of the Plan

The adoption of the Plan by the Board shall not be construed as amending, modifying or rescinding any previously approved incentive arrangements or as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable, including, without limitation, the granting of Options otherwise then under the Plan, and such arrangements may be either applicable generally or only in specific cases.  For the avoidance of doubt, prior grant of options to Optionees of the Company under their employment agreements, and not in the framework of any previous option plan, shall not be deemed an approved incentive arrangement for the purpose of this section.  Subject to the provisions of the Plan, in the event of a conflict between the terms and conditions of the Plan and the Option Agreement, the terms and conditions of the Plan shall prevail.

	
25.

	
Inability to Obtain Authority

The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company's counsel to be necessary to the lawful issuance of any Units hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Units as to which such requisite authority shall not have been obtained.

	
26.

	
Multiple Agreements

The terms of each Option may differ from other Options granted to each Optionee under the Plan at the same time.  The Administrator may also grant more than one Option to a given Optionee during the term of the Plan, either in addition to, or in substitution for, one or more Options previously granted to that Optionee.

	
27.

	
Disputes

Any dispute or disagreement which may arise under or as a result of or pursuant to this Plan or the Option Agreements shall be determined by the Administrator and any interpretation made by the Administrator of the terms of the Plan or the Option Agreements shall be final, binding and conclusive.

	 	
Adopted by the Board on ____________, 2006.

	 	 	  	 
	 	 	
Signed

	 
	 	 	  	 
	 	 	
Title

	 
	 	 	 	 

 

  

20

  

 

Approved by the Board on September 28, 2010

 

Amendments to the 2006 Units Option Plan (the "Plan")

 

	
  

	
1.

	
Anywhere in the Plan, the term "Operation Agreement" shall be replaced with the term "Company's Articles of Association".

 

	
  

	
2.

	
In section 7(a) of the Plan, the words "provided, however that in no event will such Exercise Price shall be less than 100% of the Fair Market Value per Unit on the date of grant" shall be deleted.

 

	
  

	
3.

	
In section 11(a) of the Plan, the following sentence will be inserted before the words "Except as expressly provided herein":

 

"In the event that the Company shall distribute a Unit dividend to all of the holders of shares of the Company ("Bonus Shares"), then the number of shares underlying the Options granted to each Optionee under the Plan shall be increased to include such number of Bonus Shares to which Optionee would have been entitled had the Options held thereby been exercised prior to the distribution of the Bonus Shares."

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