Document:

Exhibit
4.1

 

EVANS
BREWING COMPANY INC.

2015
STOCK OPTION AND STOCK AWARD PLAN

 

1.           Establishment,
Purpose and Term of Plan.

 

1.1         Establishment.  This
Evans Brewing Company Inc. 2015 Stock Option and Stock Award Plan (the “Plan”) shall become effective
upon the date that it is approved by the stockholders of Evans Brewing Company Inc. (the “Company”).

 

1.2         Purpose.  The
purpose of the Plan is to advance the interests of the Company and its shareholders by providing an incentive to attract, retain
and reward persons performing services for the Company and by motivating such persons to contribute to the growth and profitability
of the Company.

 

1.3         Term
of Plan.  The Plan shall continue in effect until the earlier of its termination by the Board or the date on which
all of the shares of Stock available for issuance under the Plan have been issued and all restrictions on such shares under the
terms of the Plan and the agreements evidencing Awards granted under the Plan have lapsed.  However, all Awards shall
be granted, if at all, within ten (10) years from the earlier of the date the Plan is adopted by the Board or the date the Plan
is duly approved by the shareholders of the Company.

 

2.           Definitions
and Construction.

 

2.1         Definitions.  Whenever
used herein, the following terms shall have their respective meanings set forth below:

 

(a)        “Administrator”
means the Board or, with respect to any matter as to which responsibility has been delegated to the Committee, the term Administrator
shall mean the Committee.

 

(b)        “Award”
means any award or benefit granted to any participant under the Plan, including, without limitation, the grant of an Option,
Restricted Stock Grant or Stock Appreciation Right.

 

(c)        
“Board” means the Board of Directors of the Company.  If one or more Committees have been
appointed by the Board to administer the Plan, “Board” also means such Committee(s).

 

(d)        “Code”
means the Internal Revenue Code of 1986, as amended, and any applicable regulations promulgated thereunder.

 

(e)        
“Committee” means the any committee of the Board duly appointed to administer the Plan and having
such powers as shall be specified by the Board. The Committee must be comprised of at least two (2) members of the Board.  Unless
the powers of the Committee have been specifically limited, the Committee shall have all of the powers of the Board granted herein,
including, without limitation, the power to amend or terminate the Plan at any time, subject to the terms of the Plan and any
applicable limitations imposed by law. Once appointed, the Committee shall continue to serve in its designated capacity until
otherwise directed by the Board. From time to time the Board may increase the size of the Committee and appoint additional members
thereof, remove members (with or without cause) and appoint new members in substitution therefor, fill vacancies, however caused,
and remove all members of the Committee and thereafter directly administer the Plan.

 

     

     

    

 

(f)        “Company”
means Evans Brewing Company Inc., a Delaware corporation, or any successor corporation thereto.

 

(g)        “Consultant” means any person, including an advisor, engaged by Company to render services other
than as an Employee or a Director.

 

(h)       “Director”
means a member of the Board.

 

(i)        “Disability”
means, with respect to a Grantee, that the Grantee has any medically determinable physical or mental impairment which can be expected
to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve (12) months,
and which renders the Grantee unable to engage in any substantial gainful activity.  A Grantee shall not be considered
to have a Disability unless Grantee furnishes proof of the existence thereof in such form and manner, and at such time, as the
Administrator may require, and the Administrator determines in its discretion that the Grantee has such a medically determinable
physical or mental impairment.

 

(j)        “Employee”
means any person treated as an employee (including an Officer or a Director who is also treated as an employee) in the records
of Company and, with respect to any Incentive Stock Option granted to such person, who is an employee for purposes of Section
422 of the Code; provided, however, that neither service as a Director nor payment of a director’s fee shall be sufficient
to constitute employment for purposes of the Plan.

 

(k)       “Exchange
Act” means the Securities Exchange Act of 1934, as amended.

 

(l)        “Fair
Market Value” means, as of any date, the value of a share of Stock or other property as determined by the Administrator,
in its discretion, or by the Company, in its discretion, if such determination is expressly allocated to the Company herein, subject
to the following:

 

(i) If,
on such date, the Stock is listed on any established stock exchange or a national market system, including without limitation
the National Market System of the National Association of Securities Dealers, Inc. Automated Quotation (“NASDAQ”)
System, the Fair Market Value of a share of Stock shall be the closing price of a share of Stock (or the mean of the closing bid
and asked prices of a share of Stock if the Stock is so quoted instead) as reported in The Wall Street Journal or such
other source as the Administrator deems reliable.  If the relevant date does not fall on a day on which the Stock has
traded on such securities exchange or market system, the date on which the Fair Market Value shall be established shall be the
last day on which the Stock was so traded prior to the relevant date, or such other appropriate day as shall be determined by
the Administrator, in its discretion.  If the Stock is listed on a market system but is not actively traded in such
amounts and as frequently as the Administrator deems necessary, in its sole discretion, to determine the Fair Market Value of
a share of Stock, then the Administrator shall determine, in its sole discretion, the value of a share of Stock.

 

(ii) If,
on such date, there is no public market for the Stock, the Fair Market Value of a share of Stock shall be as determined by the
Administrator in good faith without regard to any restriction other than a restriction which, by its terms, will never lapse.

 

(m)       “Grant
Agreement” means a written agreement, including any related form of stock option grant agreement, restricted stock
grant agreement or stock appreciation right grant agreement, between the Company and a Grantee setting forth the terms, conditions
and restrictions of the Award granted to the Grantee and any shares acquired upon the exercise thereof.

 

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(n)        “Grantee”
means a person who has been granted one or more Awards.

 

(o)        “Incentive
Stock Option” means an Option intended to be (as set forth in the Grant Agreement) and which qualifies as an incentive
stock option within the meaning of Section 422(b) of the Code. An Option shall only be treated as an Incentive Stock Option pursuant
to the Plan if it is originally designated as an Incentive Stock Option in the Grant Agreement.  An Option originally
designated in a Grant Agreement as an Incentive Stock Option may nonetheless be treated as a Nonstatutory Stock Option if the
Option at any time after grant fails to meet to requirements for incentive stock option treatment under Section 422 of the Code.

 

(p)        “Nonstatutory
Stock Option” means an Option not intended to be (as set forth in the Grant Agreement) or which does not qualify
as an Incentive Stock Option. An Option which is designated as a Nonstatutory Stock Option in the Grant Agreement pursuant to
which the Option was granted shall in all events be treated as a Nonstatutory Stock Option.  Furthermore, an Option
originally designated as an Incentive Stock Option may subsequently become a Nonstatutory Stock Option upon the Option subsequently
failing the meet the requirements for incentive stock option under Section 422 of the Code.

 

(q)        “Officer”
means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

 

(r)        “Option”
means a right to purchase a specified number of shares of Stock (subject to adjustment as provided in Section 4.2) pursuant to
the terms and conditions of the Plan.  An Option may be either an Incentive Stock Option or a Nonstatutory Stock Option.

 

(s)        “Plan”
means this Influence International, Inc. Stock Option and Stock Award Plan, as amended from time to time in accordance with
the terms hereof.

 

(t)        “Restricted
Stock” means shares of Stock granted under the Plan that are subject to the restrictions set forth in Section 7
hereof.

 

(u)        “Restricted
Stock Grant” means an Award representing the right to receive a specified number of shares of Restricted Stock (subject
to adjustment as provided in Section 4.2) pursuant to the terms and conditions of the Plan. 

 

(v)        “Securities
Act” means the Securities Act of 1933, as amended.

 

(w)        “Service”
means a Grantee’s employment or service with Company, whether in the capacity of an Employee, a Director or a Consultant.  The
Grantee’s Service shall not be deemed to have terminated merely because of a change in the capacity in which the Grantee
renders Service to Company, provided that there is no interruption or termination of the Grantee’s Service.  Furthermore,
a Grantee’s Service with Company shall not be deemed to have terminated if the Grantee takes any military leave, sick leave,
or other bona fide leave of absence approved by Company; provided, however, that if any such leave exceeds ninety (90) days, on
the ninety-first (91st) day of such leave the Grantee’s Service shall be deemed to have terminated unless the Grantee’s
right to return to Service with Company is guaranteed by statute or contract.  Notwithstanding the foregoing, unless
otherwise designated by Company or required by law, a leave of absence shall not be treated as Service for purposes of determining
vesting under the Grantee’s Grant Agreement.  The Grantee’s Service shall be deemed to have terminated upon
an actual termination of Service.  Subject to the foregoing, the Company, in its discretion, shall determine whether
the Grantee’s Service has terminated and the effective date of such termination.

 

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(x)        “Stock”
means the common stock of the Company, as adjusted from time to time in accordance with Section 4.2.

 

(y)        “Stock
Appreciation Right” means the right to receive an amount determined in accordance with Section 8 hereof.

 

(z)        “Stock
Appreciation Right Grant” means an Award representing the right to receive Stock Appreciation Rights with respect
to a specified number of shares of Stock (subject to adjustment as provided in Section 4.2) pursuant to the terms and conditions
of the Plan.

 

(aa)       “Ten
Percent Owner” means a Grantee who, at the time an Award is granted to the Grantee, owns, or is deemed within the
meaning of Section 422(b)(6) of the Code to own, stock possessing more than ten percent (10%) of the total combined voting power
of all classes of stock of Company within the meaning of Section 422(b)(6) of the Code.

  

2.2         Construction.  To
the extent any provision herein conflicts with the conditions of any relevant tax law or regulation which are relied upon for
tax relief in respect of a particular Award or Stock granted to a Grantee pursuant to this Plan, the provisions of said law or
regulation shall prevail over those of the Plan, and the Administrator is empowered to interpret and enforce the said prevailing
provisions. Captions and titles contained herein are for convenience only and shall not affect the meaning or interpretation of
any provision of the Plan.  Except when otherwise indicated by the context, the singular shall include the plural and
the plural shall include the singular.  Use of the term “or” is not intended to be exclusive, unless the
context clearly requires otherwise.

 

3.           Administration.

 

3.1         Administration
by the Administrator.  The Plan shall be administered by the Board, which may delegate such responsibilities in
whole or in part to a Committee.  Members of the Committee may be appointed from time to time by, and shall serve at
the pleasure of, the Board.  The Board may limit the composition of the Committee to those persons necessary to comply
with the requirements of Section 162(m) of the Code and Section 16 of the Exchange Act.  All questions of interpretation
of the Plan or of any Award shall be determined by the Administrator (the Board, or to the Committee to which the Board has delegated
such responsibility), and such determinations shall be final and binding upon all persons having an interest in the Plan or such
Option.

 

3.2         Powers
of the Administrator.  In addition to any other powers set forth in the Plan and subject to the provisions of the
Plan, the Administrator shall have the full and final power and authority, in its discretion:

 

(a)        to
determine the persons to whom, and the time or times at which, Awards shall be granted and the number of shares of Stock to which
each Award relates;

 

(b)        to
designate Options as Incentive Stock Options or Nonstatutory Stock Options;

 

(c)        to
determine the Fair Market Value of shares of Stock or other property;

 

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(d)        to
determine the terms, conditions and restrictions, not inconsistent with the terms of the Plan, applicable to each Award (which
need not be identical) and any shares acquired upon the exercise thereof, including, without limitation, (i) the exercise price
of an Option, (ii) the Grant Value of a Stock Appreciation Right, (iii) the method of payment for shares purchased upon the exercise
of an Option, (iv) the method of payment for the amount due upon exercise of a Stock Appreciation Right, (v) the method for satisfaction
of any tax withholding obligation arising in connection with the grant or exercise of an Award, including by the withholding or
delivery of shares of stock, (vi) the timing, terms and conditions of the exercisability of the Award or the vesting of any shares
acquired upon the exercise thereof, (vii) the time of the expiration of the Award, (viii) the effect of the Grantee’s termination
of Service with the Company on any of the foregoing, and (ix) all other terms, conditions and restrictions applicable to the Award
or such shares not inconsistent with the terms of the Plan;

 

(e)        to
approve one or more forms of Grant Agreement;

 

(f)        to
reduce the exercise price of any Option to the then current Fair Market Value if the Fair Market Value of the Stock covered by
such Option shall have declined since the date the Option was granted;

 

(g)        to
amend, modify, extend, cancel, renew, reprice or otherwise adjust the exercise price of, or grant a new Award in substitution
for, any Award or to waive any restrictions or conditions applicable to any Award or any shares acquired upon the exercise thereof;

 

(h)        to
accelerate, continue, extend or defer the exercisability of any Award or the vesting of any shares acquired upon the exercise
thereof, including with respect to the period following a Grantee’s termination of Service with the Company;

 

(i)        to
prescribe, amend or rescind rules, guidelines and policies relating to the Plan, or to adopt supplements to, or alternative versions
of, the Plan, including, without limitation, as the Administrator deems necessary or desirable to comply with the laws of, or
to accommodate the tax policy or custom of, foreign jurisdictions whose citizens may be granted Awards; and

 

(j)        to
correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Grant Agreement and to make all other
determinations and take such other actions with respect to the Plan or any Award as the Board may deem advisable to the extent
consistent with the Plan and applicable law.

 

3.3         Effect
of Administrator’s Decision. Whether explicitly provided elsewhere in this Plan with respect to any matter, all decisions,
determinations and interpretations of the Administrator provided in this Plan shall be made in the Administrator’s sole
and absolute discretion, and shall be final and binding on all Grantees and any other holders of any Awards. No member of the
Committee or the Board shall be liable for any action taken or determination made in good faith with respect to the Plan or any
Award granted hereunder. All such interpretations, rules, determinations, terms and conditions shall be made and prescribed in
the context of preserving the tax status under Section 422 of the Code of those Options which are designated as Incentive Stock
Options.

 

4.           Shares
Subject to Plan.

 

4.1         Maximum
Number of Shares Issuable.  Subject to adjustment as provided in Section 4.2, the maximum aggregate number of (i)
shares of Stock that may be issued under the Plan and (ii) shares of Stock with respect to which Options or Stock Appreciation
Rights may be granted, shall be Two Million (2,000,000) and shall consist of authorized but unissued or reacquired shares of Stock
or any combination thereof. Such number of shares of Stock may be issued under this Plan pursuant to Incentive Stock Options,
Nonstatutory Stock Options, Restricted Stock Grants, Stock Appreciation Right Grants, or any combination thereof, so long as the
aggregate number of shares so issued does not exceed such number of shares, as adjusted.  If an outstanding Award for
any reason expires or is terminated or canceled or if shares of Stock are acquired upon the exercise of an Award subject to a
Company repurchase option and are repurchased by the Company at the Grantee’s exercise price, the shares of Stock allocable
to the unexercised portion of such Award or such repurchased shares of Stock shall again be available for issuance under the Plan.  

 

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4.2         Adjustments
for Changes in Capital Structure.  In the event of any stock dividend, stock split, reverse stock split, recapitalization,
combination, reclassification or similar change in the capital structure of the Company, appropriate adjustments shall be made
in the number and class of shares subject to the Plan and to any outstanding Awards and in the exercise price per share of any
outstanding Awards.  If a majority of the shares which are of the same class as the shares that are subject to outstanding
Awards are exchanged for, converted into, or otherwise become (whether or not pursuant to an Ownership Change Event, as defined
in Section 10.1) shares of another corporation (the “New Shares”), the Administrator may unilaterally
amend the outstanding Awards to provide that such Awards are exercisable for New Shares.  In the event of any such amendment,
the number of shares subject to, and the exercise price per share of, the outstanding Awards shall be adjusted in a fair and equitable
manner as determined by the Administrator, in its discretion.  Notwithstanding the foregoing, any fractional share resulting
from an adjustment pursuant to this Section 4.2 shall be rounded down to the nearest whole number, and in no event may the exercise
price of any Award be decreased to an amount less than the par value, if any, of the stock subject to the Award.  The
adjustments determined by the Administrator pursuant to this Section 4.2 shall be final, binding and conclusive.

 

5.           Eligibility
and Award Limitations.

 

5.1         Persons
Eligible for Awards.  Awards may be granted only to Employees, Consultants, and Directors.  For purposes
of the foregoing sentence, “Employees,” “Consultants” and “Directors” shall include prospective
Employees, prospective Consultants and prospective Directors to whom Awards are granted in connection with written offers of an
employment or other service relationships with the Company.  Eligible persons may be granted more than one (1) Award.

 

5.2         Award
Grant Restrictions.  Any person who is not an Employee on the effective date of the grant of an Award to such person
may not be granted an Incentive Stock Option.  An Incentive Stock Option granted to a prospective Employee upon the
condition that such person become an Employee shall be deemed granted effective on the date such person commences Service with
Company, with an exercise price determined as of such date in accordance with Section 6.1.

 

5.3         Fair
Market Value Limitation.  To the extent that options designated as Incentive Stock Options become exercisable by
a Grantee for the first time during any calendar year for stock having a Fair Market Value greater than One Hundred Thousand Dollars
($100,000), the portions of such options which exceed such amount shall be treated as Nonstatutory Stock Options.  For
purposes of this Section 5.3, options designated as Incentive Stock Options shall be taken into account in the order in which
they were granted, and the Fair Market Value of stock shall be determined as of the time the option with respect to such stock
is granted.  If the Code is amended to provide for a different limitation from that set forth in this Section 5.3, such
different limitation shall be deemed incorporated herein effective as of the date and with respect to such Options as required
or permitted by such amendment to the Code.  If an Option is treated as an Incentive Stock Option in part and as a Nonstatutory
Stock Option in part by reason of the limitation set forth in this Section 5.3, the Grantee may designate which portion of such
Option the Grantee is exercising.  In the absence of such designation, the Grantee shall be deemed to have exercised
the Incentive Stock Option portion of the Option first.  Separate certificates representing each such portion shall
be issued upon the exercise of the Option.

 

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5.4        Non-Uniform
Determinations. The Administrator’s determinations under the Plan (including without limitation determinations of the
persons to receive Awards, the form, amount and timing of such Awards, the terms and provisions of such Awards and the agreements
evidencing same) need not be uniform and may be made by it selectively among persons who receive, or are eligible to receive,
Awards under the Plan, whether or not such persons are similarly situated.

 

6.           Terms
and Conditions of Options.

 

Options
shall be evidenced by Grant Agreements specifying the number of shares of Stock covered thereby, in such form as the Administrator
shall from time to time establish.  No Option or purported Option shall be a valid and binding obligation of the Company
unless evidenced by a fully executed Grant Agreement.  Grant Agreements may incorporate all or any of the terms of the
Plan by reference and shall comply with and be subject to the following terms and conditions:

 

6.1        Procedure
for Exercise; Rights as a Shareholder.  Any Option granted hereunder shall be exercisable at such times and under
such conditions as determined by the Administrator, including performance criteria with respect to the Company and/or the Grantee,
and as shall be permissible under the terms of the Plan. An Option may not be exercised for a fraction of a Share. An Option shall
be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with the terms of the
Grant Agreement by the person entitled to exercise the Option and full payment for the Stock with respect to which the Option
is exercised has been received by the Company. Full payment may, as authorized by the Administrator, consist of any consideration
and method of payment allowable under Section 6.4 of the Plan. Until the issuance (as evidenced by the appropriate entry on the
books of the Company or of a duly authorized transfer agent of the Company) of the stock certificate evidencing such Stock, no
right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Stock, notwithstanding
the exercise of the Option. The Company shall issue (or cause to be issued) such stock certificate promptly upon exercise of the
Option. No adjustment will be made for a dividend or other right for which the record date is prior to the date the stock certificate
is issued, except as provided in Section 10 hereof. Exercise of an Option in any manner shall result in a decrease in the number
shares of Stock which thereafter may be available, both for purposes of the Plan and for sale under the Option, by the number
of shares of Stock as to which the Option is exercised.

 

6.2         Exercise
Price.  The exercise price for each Option shall be established in the discretion of the Administrator; provided,
however, that (a) the exercise price per share for an Incentive Stock Option granted to a Ten Percent Owner shall not be less
than one hundred ten percent (110%) of the Fair Market Value of a share of Stock on the effective date of grant of the Option
and (b) the exercise price per share for either an Incentive Stock Option granted to a person other than a Ten Percent Owner or
a Nonstatutory Stock Option granted to any person shall not be less than the Fair Market Value of a share of Stock on the effective
date of grant of the Option. Notwithstanding the foregoing, an Option (whether an Incentive Stock Option or a Nonstatutory Stock
Option) may be granted with an exercise price lower than the minimum exercise price set forth above if such Option is granted
pursuant to an assumption or substitution for another option in a manner qualifying under the provisions of Section 424(a) of
the Code.

 

6.3         Exercise
Period.  Options shall be exercisable at such time or times, or upon such event or events, and subject to such terms,
conditions, performance criteria, and restrictions as shall be determined by the Administrator and set forth in the Grant Agreement
evidencing such Option; provided, however, that (a) no Option shall be exercisable after the expiration of ten (10) years after
the effective date of grant of such Option, (b) no Incentive Stock Option granted to a Ten Percent Owner shall be exercisable
after the expiration of five (5) years after the effective date of grant of such Option, (c) no Option granted to a prospective
Employee, prospective Consultant or prospective Director may become exercisable prior to the date on which such person commences
Service with the Company, and (d) unless otherwise permitted by applicable law, and with the exception of an Option granted to
an officer, Director or Consultant, no Option shall become exercisable at a rate less than twenty percent (20%) per year over
a period of five (5) years from the effective date of grant of such Option, subject to the Grantee’s continued Service.  Subject
to the foregoing, unless otherwise specified by the Administrator in the grant of an Option, any Option granted hereunder shall
have a term of ten (10) years from the effective date of grant of the Option.

 

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6.4         Payment
of Exercise Price.

 

(a)       Forms
of Consideration Authorized.  Except as otherwise provided below, payment of the exercise price for the number
of shares of Stock being purchased pursuant to any Option shall be made (i) in cash, by check or cash equivalent, (ii) by tender
to the Company, or attestation to the ownership, of shares of Stock owned by the Grantee having a Fair Market Value (as determined
by the Administrator without regard to any restrictions on transferability applicable to such stock by reason of federal or state
securities laws or agreements with an underwriter for the Company) not less than the exercise price, (iii) by the assignment of
the proceeds of a sale or loan with respect to some or all of the shares being acquired upon the exercise of the Option (including,
without limitation, through an exercise complying with the provisions of Regulation T as promulgated from time to time by the
Board of Governors of the Federal Reserve System) (a “Cashless Exercise”), (iv) by such other consideration
as may be approved by the Administrator from time to time to the extent permitted by applicable law, or (v) by any combination
of the foregoing.  The Administrator may at any time or from time to time, by adoption of or by amendment to the standard
forms of Grant Agreement described in Section 9, or by other means, grant Options which do not permit all of the foregoing forms
of consideration to be used in payment of the exercise price or which otherwise restrict one or more forms of consideration.

  

(b)       Limitations
on Forms of Consideration.

 

(i) Tender
of Stock.  Notwithstanding the foregoing, an Option may not be exercised by tender to the Company, or attestation
to the ownership, of shares of Stock to the extent such tender or attestation would constitute a violation of the provisions of
any law, regulation or agreement restricting the redemption of the Company’s stock.  Unless otherwise provided
by the Administrator, an Option may not be exercised by tender to the Company, or attestation to the ownership, of shares of Stock
unless such shares either have been owned by the Grantee for more than six (6) months or were not acquired, directly or indirectly,
from the Company.

 

(ii) Cashless
Exercise.  The Company reserves, at any and all times, the right, in the Company’s sole and absolute discretion,
to establish, decline to approve or terminate any program or procedures for the exercise of Options by means of a Cashless Exercise.

 

6.5         Tax
Withholding.  The Company shall have the right, but not the obligation, to deduct from the shares of Stock issuable
upon the exercise of an Option, or to accept from the Grantee the tender of, a number of whole shares of Stock having a Fair Market
Value, as determined by the Administrator, equal to all or any part of the federal, state, local and foreign taxes, if any, required
by law to be withheld by the Company with respect to such Option or the shares acquired upon the exercise thereof.  Alternatively
or in addition, in its discretion, the Administrator shall have the right to require the Grantee, through payroll withholding,
cash payment or otherwise, including by means of a Cashless Exercise, to make adequate provision for any such tax withholding
obligations of the Company arising in connection with the Option or the shares acquired upon the exercise thereof.  The
Company shall have no obligation to deliver shares of Stock or to release shares of Stock from an escrow established pursuant
to the Grant Agreement until the Company’s tax withholding obligations have been satisfied by the Grantee.

 

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6.6         Repurchase
Rights.  Stock acquired by the exercise of an Option granted under the Plan may be subject to a right of first refusal,
one or more repurchase options, or other conditions and restrictions as set forth in any shareholders, buy-sell or similar agreement,
and as determined by the Board in its discretion at the time the Option is granted.  In exercising its right of first
refusal or other repurchase right, the repurchase price may be paid by the Company, or its assignee, by cash, check, or cancellation
of indebtedness.  The Company shall have the right to assign at any time any repurchase right it may have, whether or
not such right is then exercisable, to one or more persons as may be selected by the Company.  Upon request by the Company,
each Grantee shall execute any agreement evidencing such transfer restrictions prior to the receipt of shares of Stock hereunder,
and shall promptly present to the Company any and all certificates representing shares of Stock acquired hereunder for the placement
on such certificates of appropriate legends evidencing any such transfer restrictions.  

  

6.7         Effect
of Termination of Service.

 

(a)      Option
Exercisability.  Subject to earlier termination of the Option as otherwise provided herein, an Option shall
be exercisable after a Grantee’s termination of Service as follows:

 

(i) Disability.  If
the Grantee’s Service with the Company is terminated because of the Disability of the Grantee, the Option, to the extent
unexercised and exercisable on the date on which the Grantee’s Service terminated, may be exercised by the Grantee (or the
Grantee’s guardian or legal representative) at any time prior to the expiration of six (6) months (or such longer period
of time as determined by the Administrator, in its discretion) after the date on which the Grantee’s Service terminated,
but in any event no later than the date of expiration of the Option’s term as set forth in the Grant Agreement evidencing
such Option (the “Option Expiration Date”).

 

(ii) Death.  If
the Grantee’s Service with the Company is terminated because of the death of the Grantee, the Option, to the extent unexercised
and exercisable on the date on which the Grantee’s Service terminated, may be exercised by the Grantee’s legal representative
or other person who acquired the right to exercise the Option by reason of the Grantee’s death at any time prior to the
expiration of six (6) months (or such longer period of time as determined by the Administrator, in its discretion) after the date
on which the Grantee’s Service terminated, but in any event no later than the Option Expiration Date.  The Grantee’s
Service shall be deemed to have terminated on account of death if the Grantee dies within thirty (30) days (or such longer period
of time as determined by the Administrator, in its discretion) after the Grantee’s termination of Service.

 

(iii) Termination
After Change in Control.  The Administrator may, in its discretion, provide in any Grant Agreement that if the Grantee’s
Service with the Company ceases as a result of “Termination After Change in Control” (as defined in such Grant Agreement),
then (1) the Option, to the extent unexercised and exercisable on the date on which the Grantee’s Service terminated, may
be exercised by the Grantee (or the Grantee’s guardian or legal representative) at any time prior to the expiration of six
(6) months (or such longer period of time as determined by the Administrator, in its discretion) after the date on which the Grantee’s
Service terminated, but in any event no later than the Option Expiration Date, and (2) the exercisability and vesting of the Option
and any shares acquired upon the exercise thereof shall be accelerated effective as of the date on which the Grantee’s Service
terminated to such extent, if any, as shall have been determined by the Administrator, in its discretion, and set forth in the
Grant Agreement.

 

(iv) Other
Termination of Service.  If the Grantee’s Service with the Company terminates for any reason, except Disability
or death, the Option, to the extent unexercised and exercisable by the Grantee on the date on which the Grantee’s Service
terminated, may be exercised by the Grantee within ninety (90) days (or such longer period of time as determined by the Administrator,
in its discretion) after the date on which the Grantee’s Service terminated, but in any event no later than the Option Expiration
Date.

 

    	 	9	 

     

    

 

(b)       Extension
if Exercise Prevented by Law.  Notwithstanding the foregoing, if the exercise of an Option within the applicable
time periods set forth in Section 6.7(a) is prevented by the provisions of Section 13 below, the Option shall remain exercisable
until thirty (30) days (or such longer period of time as determined by the Administrator, in its discretion) after the date the
Grantee is notified by the Company that the Option is exercisable, but in any event no later than the Option Expiration Date.

 

(c)       Extension
if Grantee Subject to Section 16(b).  Notwithstanding the foregoing, if a sale within the applicable time periods
set forth in Section 6.7(a) of shares acquired upon the exercise of the Option would subject the Grantee to suit under Section
16(b) of the Exchange Act, the Option shall remain exercisable until the earliest to occur of (i) the tenth (10th) day following
the date on which a sale of such shares by the Grantee would no longer be subject to such suit, (ii) the one hundred and ninetieth
(190th) day after the Grantee’s termination of Service, or (iii) the Option Expiration Date.

 

6.8        Buyout
Provisions.  The Administrator may at any time offer to buy out, for a payment in cash or shares of Stock, an Option
previously granted, based on such terms and conditions as the Administrator shall establish and communicate to the Grantee at
the time that such offer is made.

 

7.           Terms
and Conditions of Restricted Stock Grants

 

Restricted
Stock Grants shall be evidenced by Grant Agreements specifying the number of shares of Restricted Stock covered thereby, in such
form as the Administrator shall from time to time establish.  No Restricted Stock Grant or purported Restricted Stock
Grant shall be a valid and binding obligation of the Company unless evidenced by a fully executed Grant Agreement.  Grant
Agreements may incorporate all or any of the terms of the Plan by reference and shall comply with and be subject to the following
terms and conditions:

 

7.1        Restrictions.
Shares of Restricted Stock may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, except
by will or the laws of descent and distribution, for such period as the Administrator shall determine from the date on which the
Award is granted (the “Restricted Period”). The Administrator may also impose such additional or alternative
restrictions and conditions on the shares of Restricted Stock as it deems appropriate, including but not limited to the satisfaction
of performance including performance criteria with respect to the Company, the Company and/or the Grantee, and as shall be permissible
under the terms of the Plan. Certificates for shares of Restricted Stock shall bear an appropriate legend referring to such restrictions,
and any attempt to dispose of any such shares in contravention of such restrictions shall be null and void ab initio and
without effect. During the Restricted Period, such certificates shall be held with an agent designated by the Administrator under
the terms and conditions of escrow and security agreements approved by the Administrator. In determining the Restricted Period
of an Award the Administrator may provide that the foregoing restrictions shall lapse with respect to specified percentages of
the awarded shares on successive anniversaries of the date of such Award.

 

7.2        Adjustment
of Performance Goals. The Administrator may adjust performance goals for any shares of Restricted Stock to take into account
changes in law and accounting and tax rules and to make such adjustments as the Administrator deems necessary or appropriate to
reflect the inclusion or the exclusion of the impact of extraordinary or unusual items, events or circumstances. The Administrator
also may adjust the performance goals by reducing the amount to be received by any Grantee pursuant to an Award if and to the
extent that the Administrator deems it appropriate.

 

    	 	10	 

     

    

 

7.3        Repurchase
Rights.  Restricted Stock granted under the Plan may be subject to a right of first refusal, one or more repurchase
options, or other conditions and restrictions as set forth in a shareholders, buy-sell or other similar agreement and as determined
by the Board in its discretion at the time the Restricted Stock is granted.  In exercising its right of first refusal
or other repurchase right, the repurchase price may be paid by the Company, or its assignee, by cash, check, or cancellation of
indebtedness.  The Company shall have the right to assign at any time any repurchase right it may have, whether or not
such right is then exercisable, to one or more persons as may be selected by the Company.  Upon request by the Company,
each Grantee shall execute any agreement evidencing such transfer restrictions prior to the receipt of shares of Restricted Stock
hereunder, and shall promptly present to the Company any and all certificates representing shares of Restricted Stock acquired
hereunder for the placement on such certificates of appropriate legends evidencing any such transfer restrictions.  

 

7.4        Forfeiture.
Subject to such exceptions as may be determined by the Administrator, upon the termination of the Grantee’s Service
for any reason prior to the expiration of the Restricted Period of an Award, any shares remaining subject to restrictions (after
taking into account the provisions of Section 7.6) shall thereupon be forfeited by the Grantee and transferred to, and reacquired
by, the Company at no cost to the Company, subject to all applicable law.

 

7.5        Ownership.
During the Restricted Period the Grantee shall possess all incidents of ownership of such shares of Restricted Stock, subject
to Section 7.1, including the right to receive dividends with respect to such shares and to vote such shares.

 

8.           Terms
and Conditions of Stock Appreciation Right Grants

 

Stock
Appreciation Rights shall be evidenced by Grant Agreements specifying the number of rights grants, in such form as the Administrator
shall from time to time establish.  No Stock Appreciation Right or purported Stock Appreciation Right shall be a valid
and binding obligation of the Company unless evidenced by a fully executed Grant Agreement.  Grant Agreements may incorporate
all or any of the terms of the Plan by reference and shall comply with and be subject to the following terms and conditions:

 

8.1        Value
of Stock Appreciation Right. Each Stock Appreciation Right shall entitle the Grantee to receive, subject to the terms and
conditions of this Plan and the Grant Agreement relating thereto, a payment in an amount equal to the positive difference, if
any, obtained by deducting (i) the Fair Market Value of one share of Stock as of the Stock Appreciation Right’s grant date
or such greater amount as may be set forth by the Committee in the Grant Agreement (the “Grant Value”),
subject to adjustment in accordance with this Plan from (ii) the Fair Market Value of one share of Stock as of the exercise date
for the Stock Appreciation Right.

 

8.2        Exercise
of Stock Appreciation Rights.  

 

(a)        Election
to Exercise Vested Stock Appreciation Right. Any Stock Appreciation Right granted hereunder shall be exercisable at such times
and under such conditions as determined by the Administrator, including performance criteria with respect to the Company, the
Company and/or the Grantee, and as shall be permissible under the terms of the Plan. A Stock Appreciation Right may not be exercised
with respect to a fraction of a Share. A Stock Appreciation Right shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the Grant Agreement by the person entitled to exercise
the Stock Appreciation Right, which notice will specify the number of vested Stock Appreciation Rights which Grantee is electing
to exercise.

 

    	 	11	 

     

    

 

(b)        Deemed
Exercise of Stock Appreciation Rights. Except as otherwise provided in the Grant Agreement and subject to any additional restrictions
set forth in the Grant Agreement, upon the Grantee’s termination of Service (whether due to death, Disability or any other
reason) or upon a Change in Control, the Grantee will be deemed to have exercised all vested Stock Appreciation Rights.

 

8.3        Exercise
Period.  Stock Appreciation Rights shall be exercisable at such time or times, or upon such event or events, and
subject to such terms, conditions, performance criteria, and restrictions as shall be determined by the Administrator and set
forth in the Grant Agreement evidencing such Stock Appreciation Right; provided, however, that no Stock Appreciation Right shall
be exercisable after the expiration of ten (10) years after the effective date of grant of such Stock Appreciation Right and unless
otherwise permitted by applicable law, and with the exception of a Stock Appreciation Right granted to an officer, Director or
Consultant, no Stock Appreciation Right shall become exercisable at a rate less than twenty percent (20%) per year over a period
of five (5) years from the effective date of grant of such Stock Appreciation Right, subject to the Grantee’s continued
Service.  Subject to the foregoing, unless otherwise specified by the Administrator in the grant of a Stock Appreciation
Right, any Stock Appreciation Right granted hereunder shall have a term of ten (10) years from the effective date of grant of
the Stock Appreciation Right.

 

8.4         Payment
of Amount Due. Payment of the amount due upon exercise of a Stock Appreciation Right shall be made (i) in cash, by check or
cash equivalent, (ii) shares of Stock, (iii) by such other consideration as may be approved by the Administrator from time to
time to the extent permitted by applicable law, or (iv) by any combination of the foregoing. The Company shall pay the amount
due within thirty (30) days of the exercise of the Stock Appreciation Right.

 

8.5         Tax
Withholding.  The Company shall have the right, but not the obligation, to deduct from the amount due upon exercise
of a Appreciation Right an amount equal to all or any part of the federal, state, local and foreign taxes, if any, required by
law to be withheld by the Company with respect to such Appreciation Right upon the exercise thereof.  Alternatively
or in addition, in its discretion, the Administrator shall have the right to require the Grantee, through payroll withholding,
cash payment or otherwise, to make adequate provision for any such tax withholding obligations of the Company arising in connection
with the Appreciation Right upon the exercise thereof.  The Company shall have no obligation to pay any amounts due
until the Company’s tax withholding obligations have been satisfied by the Grantee.

 

8.6        Adjustments.
If the Committee determines, in its sole discretion, that any distribution, merger, consolidation, reorganization, split-up,
spin-off, subdivision, combination, share exchange, dividend, contribution, disposition or acquisition (either of equity or assets),
warrants or rights offering to purchase interests in the Company or the Company, or other extraordinary event affects the Stock
Appreciation Rights authorized and granted under this Plan such that an adjustment in such Stock Appreciation Rights is required
in order to preserve the level of benefits or potential benefits (without enlargement or dilution of such benefits) intended to
accrue to the Grantees under this Plan, then the Committee, in its sole discretion, shall make such adjustments in the Stock Appreciation
Rights (including increases or decreases to the Grant Value of a Stock Appreciation Right, increases or decreases to the number
of Stock Appreciation Rights granted and/or changes to the equity to which the value of a Stock Appreciation Right is tied) and/or
the terms of this Plan relating to the valuation of a Stock Appreciation Right in such manner as the Committee, in its sole discretion,
deems appropriate and equitable. The Committee may make any such adjustment for all Grantees and all Stock Appreciation Rights,
or the Committee, in its sole discretion, may make such adjustments only for such Grantees or such Stock Appreciation Rights as
it deems appropriate; provided that any such adjustment is made in compliance with the requirements of Code Section 409A
relating to “stock rights” that do not constitute nonqualified deferred compensation for purposes of Code Section
409A. In addition, the Committee may, without the consent of any Grantee, convert or exchange the Stock Appreciation Rights granted
pursuant to this Plan for an equity award that is based on or tied to the value of any person whose assets include the ownership
of 50% or more of the Company; provided that any such conversion or exchange is made in compliance with the requirements of
Code Section 409A relating to “stock rights” that do not constitute nonqualified deferred compensation for purposes
of Code Section 409A.

 

    	 	12	 

     

    

 

8.7        No
Rights as a Shareholder. At no time with the Grantee be considered a shareholder of the Company or have any rights as a shareholder;
the right to vote or receive dividends or any other rights as a shareholder shall never exist with respect to a Stock Appreciation
Right, notwithstanding the exercise of the Stock Appreciation Right. Exercise of a Stock Appreciation Right in any manner shall
result in a decrease in the number rights which thereafter may be available, both for purposes of the Plan and for exercise under
the Stock Appreciation Right, by the number of rights to which the Stock Appreciation Right is exercised.

 

8.8        Buyout
Provisions.  The Administrator may at any time offer to buy out, for a payment in cash or shares of Stock, a Stock
Appreciation Right previously granted, based on such terms and conditions as the Administrator shall establish and communicate
to the Grantee at the time that such offer is made.

 

9.           Standard
Forms of Grant Agreement.

 

9.1         General.  Unless
otherwise provided by the Administrator at the time the Award is granted, an Award shall comply with and be subject to the terms
and conditions set forth in the standard form of Grant Agreement in effect at the time of the grant.

 

9.2         Authority
to Vary Terms.  The Administrator shall have the authority from time to time to vary the terms of any of the standard
form of Grant Agreement described in this Section 9 either in connection with the grant or amendment of an individual Award or
in connection with the authorization of a new standard form or forms; provided, however, that the terms and conditions of any
such new, revised or amended standard form or forms of Grant Agreement are not inconsistent with the terms of the Plan.

 

10.           Change
in Control.

 

10.1       Definitions.

 

(a)       An
“Ownership Change Event” shall be deemed to have occurred if any of the following occurs with respect
to the Company: (i) the direct or indirect sale or exchange in a single or series of related transactions by the shareholders
of the Company of more than fifty percent (50%) of the voting stock of the Company; (ii) a merger or consolidation in which the
Company is a party; (iii) the sale, exchange, or transfer of all or substantially all of the assets of the Company; or (iv) a
liquidation or dissolution of the Company.

 

(b)       A
“Change in Control” shall mean an Ownership Change Event or a series of related Ownership Change Events
(collectively, a “Transaction”) wherein the shareholders of the Company immediately before the Transaction
do not retain immediately after the Transaction, in substantially the same proportions as their ownership of shares of the Company’s
voting stock immediately before the Transaction, direct or indirect beneficial ownership of more than fifty percent (50%) of the
total combined voting power of the outstanding voting stock of the Company or the corporation or corporations to which the assets
of the Company were transferred (the “Transferee Corporation(s)”), as the case may be.  For
purposes of the preceding sentence, indirect beneficial ownership shall include, without limitation, an interest resulting from
ownership of the voting stock of one or more corporations which, as a result of the Transaction, own the Company or the Transferee
Corporation(s), as the case may be, either directly or through one or more subsidiary corporations.  The Board shall
have the right to determine whether multiple sales or exchanges of the voting stock of the Company or multiple Ownership Change
Events are related, and its determination shall be final, binding and conclusive.

 

    	 	13	 

     

    

 

10.2         Effect
of Change in Control on Options.  In the event of a Change in Control, the surviving, continuing, successor, or
purchasing corporation or parent corporation thereof, as the case may be (the “Acquiring Corporation”),
may either assume the Company’s rights and obligations under outstanding Options or substitute for outstanding Options substantially
equivalent options for the Acquiring Corporation’s stock.  In the event the Acquiring Corporation elects not to
assume or substitute for outstanding Options in connection with a Change in Control, any unexercisable or unvested portions of
outstanding Options and any shares acquired upon the exercise thereof held by Grantees whose Service has not terminated prior
to such date shall be immediately exercisable and vested in full as of the date ten (10) days prior to the date of the Change
in Control.  The exercise or vesting of any Option and any shares acquired upon the exercise thereof that was permissible
solely by reason of this Section 10.2 shall be conditioned upon the consummation of the Change in Control.  Any Options
which are neither assumed or substituted for by the Acquiring Corporation in connection with the Change in Control nor exercised
as of the date of the Change in Control shall terminate and cease to be outstanding effective as of the date of the Change in
Control.  Notwithstanding the foregoing, shares acquired upon exercise of an Option prior to the Change in Control and
any consideration received pursuant to the Change in Control with respect to such shares shall continue to be subject to all applicable
provisions of the Grant Agreement evidencing such Option except as otherwise provided in such Grant Agreement.  Furthermore,
notwithstanding the foregoing, if the corporation the stock of which is subject to the outstanding Options immediately prior to
an Ownership Change Event described in Section 10.1(a)(i) constituting a Change in Control is the surviving or continuing corporation
and immediately after such Ownership Change Event less than fifty percent (50%) of the total combined voting power of its voting
stock is held by another corporation or by other corporations that are members of an affiliated group within the meaning of Section
1504(a) of the Code without regard to the provisions of Section 1504(b) of the Code, the outstanding Options shall not terminate
unless the Board otherwise provides in its discretion.

 

10.3        Effect
of Change in Control on Restricted Stock. In the event of a Change in Control, all restrictions then outstanding with respect
to shares of Restricted Stock awarded hereunder shall automatically expire and be of no further force and effect. The Administrator
shall have the authority (and the Grant Agreement may so provide) to cancel all or any portion of any outstanding restrictions
prior to the expiration of the Restricted Period with respect to any or all of the shares of Restricted Stock awarded on such
terms and conditions as the Administrator shall deem appropriate.

 

10.4       Effect
of Change in Control on Stock Appreciation Rights. In the event of a Change in Control, all outstanding Stock Appreciation
Rights shall become fully vested.

 

11.         Provision
of Information.

 

Unless
not required by applicable law, at least annually, copies of the Company’s balance sheet and income statement for the just
completed fiscal year shall be made available to each Grantee and purchaser of shares of Stock upon the exercise of an Option.  The
Company shall not be required to provide such information to key employees whose duties in connection with the Company assure
them access to equivalent information.

 

    	 	14	 

     

    

 

12.         Nontransferability
of Awards.

 

During
the lifetime of the Grantee, an Award shall be exercisable only by the Grantee or the Grantee’s guardian or legal representative.  No
Award shall be assignable or transferable by the Grantee, except by will or by the laws of descent and distribution.  Any
unauthorized attempt at assignment, transfer, pledge or other disposition shall be without effect and void ab initio and
without effect.

  

13.         Compliance
with Securities Law.

 

The
grant of Awards and the issuance of shares of Stock pursuant to Awards shall be subject to compliance with all applicable requirements
of federal, state and foreign law with respect to such securities.  Awards may not be exercised if the issuance of shares
of Stock upon exercise would constitute a violation of any applicable federal, state or foreign securities laws or other law or
regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed.  In
addition, no Award may be exercised unless (a) a registration statement under the Securities Act shall at the time of exercise
of the Award be in effect with respect to the shares issuable upon exercise of the Award or (b) in the opinion of legal counsel
to the Company, the shares issuable upon exercise of the Award may be issued in accordance with the terms of an applicable exemption
from the registration requirements of the Securities Act.  The inability of the Company to obtain from any regulatory
body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance
and sale of any shares hereunder shall relieve the Company of any liability in respect of the failure to issue or sell such shares
as to which such requisite authority shall not have been obtained.  As a condition to the exercise of any Award or the
receipt of any Stock pursuant to this Plan, the Company may require the Grantee to satisfy any qualifications that may be necessary
or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect
thereto as may be requested by the Company.

 

14.         Indemnification.

 

In
addition to such other rights of indemnification as they may have as members of the Board or officers or employees of the Company,
members of the Board and any officers or employees of the Company to whom authority to act for the Board or the Company is delegated
shall be indemnified by the Company against all reasonable expenses, including attorneys’ fees, actually and necessarily
incurred in connection with the defense of any action, suit or proceeding, or in connection with any appeal therein, to which
they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan, or any
right granted hereunder, and against all amounts paid by them in settlement thereof (provided such settlement is approved by independent
legal counsel selected by the Company) or paid by them in satisfaction of a judgment in any such action, suit or proceeding, except
in relation to matters as to which it shall be adjudged in such action, suit or proceeding that such person is liable for gross
negligence, bad faith or intentional misconduct in duties; provided, however, that within sixty (60) days after the institution
of such action, suit or proceeding, such person shall offer to the Company, in writing, the opportunity at its own expense to
handle and defend the same.

 

15.         Termination
or Amendment of Plan.

 

The
Board may terminate or amend the Plan at any time.  However, subject to changes in applicable law, regulations or rules
that would permit otherwise, without the approval of the Company’s shareholders, there shall be (a) no increase in the maximum
aggregate number of shares of Stock that may be issued under the Plan (except by operation of the provisions of Section 4.2),
(b) no change in the class of persons eligible to receive Incentive Stock Options, and (c) no other amendment of the Plan that
would require approval of the Company’s shareholders under any applicable law, regulation or rule.  No termination
or amendment of the Plan may adversely affect any then outstanding Award or any unexercised portion thereof, without the consent
of the Grantee, unless such termination or amendment is required to enable an Award designated as an Incentive Stock Option to
qualify as an Incentive Stock Option or is necessary to comply with any applicable law, regulation or rule.

  

    	 	15	 

     

    

 

16.         No
Enlargement of Employee Rights.

 

This
Plan is strictly a voluntary undertaking on the part of the Company and shall not be deemed to constitute a contract between the
Company and any Grantee to be consideration for, or an inducement to, or a condition of, the employment of any Grantee.  Nothing
contained in the Plan shall be deemed to give the right to any Grantee to be retained as an employee of the Company or to interfere
with the right of the Company to discharge any Grantee at any time.

 

17.         Application
of Funds.

 

The
proceeds received by the Company from the sale of Stock pursuant to Grant Agreements, except as otherwise provided herein, will
be used for general corporate purposes.

 

18.         Shareholder
Approval.

 

The
Plan or any increase in the maximum aggregate number of shares of Stock issuable thereunder as provided in Section 4.1 (the “Authorized
Shares”) shall be approved by the shareholders of the Company within twelve (12) months of the date of adoption
thereof by the Board.  Awards granted prior to shareholder approval of the Plan or in excess of the Authorized Shares
previously approved by the shareholders shall become exercisable no earlier than the date of shareholder approval of the Plan
or such increase in the Authorized Shares, as the case may be.

 

19.         Reservation
of Stock.

 

The
Company, during the term of this Plan, will at all times reserve and keep available such number of shares of Stock as shall be
sufficient to satisfy the requirements of the Plan. 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 and sale
of any Stock hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Stock as to
which such requisite authority shall not have been obtained.

 

20.         Information
to Grantees and Purchasers.

 

The
Company shall make available to each Grantee, during the period such Grantee has one or more Awards outstanding, copies of annual
financial statements.  The Company shall not be required to provide such statements to key employees whose duties in
connection with the Company assure their access to equivalent information.

 

21.         Certain
Tax Matters.

 

The
Administrator may require the holder of any Award or Stock received pursuant to this Plan to remit to the Company, regardless
of when such liability arises, an amount sufficient to satisfy any Federal, state and local tax withholding requirements associated
with such Award or Stock.  The Administrator may, in its discretion, permit the holder of Stock to satisfy any such
obligation by having withheld from the shares (or where applicable, cash) to be delivered to the holder of upon exercise of an
Option a number of shares (or, where applicable, amount of cash) sufficient to meet any such withholding requirement. If a Grantee
makes an election under Section 83(b) of the Code with respect to the receipt of any Award, or disposes of Stock acquired pursuant
to the exercise of an Incentive Stock Option in a transaction deemed to be a disqualifying disposition under Section 421 of the
Code, then, within thirty (30) days of such Section 83(b) election or disqualifying disposition, the Participant shall inform
the Company of such actions.

 

    	 	16	 

     

    

 

22.         Repurchase
Rights. 

 

The
Administrator may, in its discretion, subject any Award to repurchase rights provisions.  The terms and conditions of
any repurchase rights will be established by the Administrator in its sole discretion and shall be set forth in the Grant Agreement
representing the Award.  To ensure that shares of Stock subject to a repurchase right under this Section 22 will be
available for repurchase, the Administrator may require the holder of an Award to deposit the certificate or certificates evidencing
such shares with an agent designated by the Administrator under the terms and conditions of escrow and security agreements approved
by the Administrator.

 

23.         Right
of First Refusal. 

 

The
Administrator may, in its discretion, subject any Award to right of first refusal provisions.  The terms and conditions
of any right of first refusal provisions will be established by the Administrator in its sole discretion and set forth in the
Grant Agreement representing the Award.

 

24.         Non-Exclusivity
of the Plan.

 

Neither
the adoption of the Plan by the Board nor the submission of the Plan to stockholders of the Company for approval shall be construed
as creating any limitations on the power or authority of the Board to adopt such other or additional incentive or other compensation
arrangements of whatever nature as the Board may deem necessary or desirable or preclude or limit the continuation of any other
plan, practice or arrangement for the payment of compensation or fringe benefits to employees generally, or to any class or group
of employees, which the Company now has lawfully put into effect, including, without limitation, any retirement, pension, savings
and stock purchase plan, insurance, death and disability benefits and executive short-term or long-term incentive plans.

 

 

17Exhibit 10.1

 

DISTRIBUTOR AGREEMENT

This Distributor Agreement (“Agreement”) is made effective as of November _, 2015 (the “Effective Date”) by and between GigOptix, Inc., a company incorporated under the laws of the State of Delaware, USA, having its chief place of business at 130 Baytech Drive, San Jose, CA 95134, USA (“GigOptix”) and Avnet Asia Pte Ltd,, a company organized under the law of Singapore , with its principal place of business at 151 Lorong Chuan, #06-03, New Tech Park, Singapore 556741 (“Distributor”).

GigOptix is a designer, manufacturer and seller of certain high speed semiconductor products for interfacing with Optical Communication Systems, RF and Microwave, Millimeter-Wave, High Speed Digital Semiconductor Products and ASIC’s.

As a part of its business, GigOptix designs and manufactures custom integrated circuits based on the specifications and requirements of each customer (the “Semiconductor Products”).

Distributor and GigOptix desire for Distributor to promote, market, and sell the GigOptix Solutions, the Semiconductor Products, and related services in the Territory/Customers (as further described in Exhibit A).

1.             Grant; Ownership; Restrictions

(a)           Grant. Subject to the terms and conditions of this Agreement, GigOptix appoints Distributor for the term of this Agreement, and Distributor accepts such appointment, as the non-exclusive independent distributor of the GigOptix Solutions, the Semiconductor Products, and related services in the Territory. Distributor may trade under this Agreement through its Affiliates and the terms and conditions of this Agreement shall automatically extend to any Affiliate of Distributor which may now exist or hereafter be formed or acquired by Distributor. For the purposes of this Agreement, “Affiliate” shall mean any person, partnership, joint venture, company, corporation or other form of enterprise, domestic or foreign, that directly or indirectly control or own, are controlled or owned by, or are under common control or ownership with the Distributor. Distributor shall not promote or market the GigOptix Solutions, or solicit Purchase Order for Semiconductor Products from any customer or prospective customer located, outside of the Territory. The initial Semiconductor Products and their respective pricing and Customers are set forth in Exhibit A. Additional Semiconductor Products, their pricing, and Distributors will be set forth in the Executed Quotations (as defined in Section 4(a)(ii)). Because the Semiconductor Products are specifically designed for each Customer, Distributor may only distribute and sell the Semiconductor Products to the Customers for whom the chips were designed.

(b)           Ownership. With respect to any mask-work developed by GigOptix in connection with a Purchase Order for services, and any software and/or documentation incorporated in or bundled with the Semiconductor Products, all ownership rights in and to such mask-work, software and/or documentation shall remain solely and exclusively with GigOptix. No rights are granted to any intellectual property residing in the Semiconductor Products (including without limitation, software and/or documentation or any data furnished hereunder) except the grant of a non-exclusive, non-transferable copyright license under GigOptix’s copyrights to Distributor, to distribute the software (in object code format) and/or documentation only as part of the Semiconductor Products. GigOptix represents that it each customer of its Semiconductor Products will have all necessary rights under GigOptix’s copyrights for the use of such software (in object code format) and/or documentation.

 

(c)           Pass-Through Terms. Distribution of the Semiconductor Products is subject to an agreement between Distributor and its customers that protects GigOptix’s interests at least to the same extent as these terms and conditions.

(d)           Restrictions. Unless otherwise specifically provided in writing, Distributor shall not have the right to any mask-work or software source code. Distributor shall not: (a) modify, adapt, alter, translate, or create derivative works from, the software; (b) assign, sublicense, lease, rent, loan, transfer, disclose, or otherwise make available the software; (c) merge the software with any other software; or (d) reverse assemble, decompile, disassemble, or otherwise attempt to derive the source code for the software without written authorization from GigOptix, except to the extent permitted by law. Distributor shall not remove any proprietary rights legends of GigOptix in any software or documentation provided by GigOptix.

2.             Responsibilities of GigOptix

GigOptix will:

(a)           Provide marketing, technical, and sales assistance to Distributor to support seminars, trade shows, and special customer presentations as the parties mutually deem appropriate;

(b)           Supply sales materials, drawings, catalogues, and other material in necessary for promoting the sale of GigOptix Solutions and Semiconductor Products;

(c)           Cooperate in the training of Distributor’s sales force and field service engineers to most efficiently and effectively sell and service the GigOptix Solutions and Semiconductor Products;

(d)           Provide technical support via telephone and electronic media in accordance with GigOptix’s then-current technical support policy, as well as on-site technical support, provided that any request for on-site technical support is reasonable and that the responsibility for associated costs is determined on a case-by-case basis; and

(e)           Obtain and maintain all necessary export licenses and documentation for the export of the Semiconductor Products to the Territory.

3.             Responsibilities of Distributor

Distributor will:

(a)           (i) Promote actively and use its commercially reasonable efforts to effect the sale and service of the GigOptix Solutions and Semiconductor Products within the Territory, (ii) conduct business in a manner that complies with the terms of this Agreement (iii) avoid deceptive, misleading or unethical practices that are or might be detrimental to GigOptix, GigOptix Solutions, Semiconductor Products or the public, (iv) make no false or misleading representations (including, without limitation, in advertising) with regard to GigOptix, GigOptix Solutions, or Semiconductor Products, and (v) make no representations, warranties or guarantees on behalf of GigOptix to customers or to the trade with respect to the specifications, features or capabilities of GigOptix Solutions or Semiconductor Products that are inconsistent with the literature distributed by GigOptix;

 

(b)           Maintain a qualified sales and marketing staff as well as applications and service staff sufficient to provide for the sales and support of GigOptix Solutions and Semiconductor Products in the Territory. Such sales and other staff for the GigOptix Solutions and Semiconductor Products will not be used to sell products or services of competitors of GigOptix to any accounts, and shall be segregated from such staff of Distributor who sells such products or services of competitors of GigOptix;

(c)           Advise GigOptix in a timely manner as to all aspects of a proposed sale of services or products to enable GigOptix to fill customer orders promptly, and answer customer inquiries promptly;

(d)           Actual Monthly Sales Reports. provide GigOptix, for each calendar Month, on or before the fifth (5th ) day of the following month, written reports setting forth a detail report showing the quantity and GigOptix part number of component products delivered in the preceding month along with the selling price for each end customer, any problems with the Products reported by those end customers during such month;

(e)           Monthly Inventory Reports. provide GigOptix, for each calendar Month, on or before the fifth (5th) day of the following month, written reports setting forth a detail report showing the inventory level of each GigOptix part number of component;

(f)           Monthly Purchase Forecast. provide a monthly forecast of end customers’ requirements including both (i) firm backlog backed by the specific purchase orders and (ii) future forecasted units from end customers;

(g)           Comply with good business practices and all applicable international, national, state, regional and local laws and regulations relevant to this Agreement as well as avoid activities or trade practices that may be injurious to GigOptix’s good name and goodwill;

(h)           Display and use properly GigOptix’s trademarks solely in accordance with GigOptix’s guidelines and refrain from the use of any GigOptix’s trademark on a Semiconductor Products not manufactured by GigOptix;

(i)           Provide pre-and post-sales first line technical support services for the GigOptix Solutions and Semiconductor Products;

(j)           Translate and reproduce all GigOptix manuals, advertising and promotional materials used in connection with Semiconductor Products into the language(s) of the Territory, subject to GigOptix’s final approval of the translation on a as needed basis; and

(k)           Comply with all applicable international, national, state, regional and local laws and regulations in performing its duties hereunder and in any of its dealings with respect to the technical information and technology disclosed hereunder.

4.             Pricing, Payment, and Taxes

(a)           Prices to Distributor

(i) During the term of this Agreement, based on each request for quotation from Distributor specifying the type of GigOptix Solution, Semiconductor Products, and any other relevant information (including but not limited to quantity, lead time, and/or requested Non-Recurring Engineering (NRE) or other services), GigOptix shall prepare a quote for Distributor setting forth the pricing and the information requested for each GigOptix Solution, Semiconductor Products, or service. Because Semiconductor Products are customized to each application, GigOptix will provide a quotation to Distributor after all the necessary technical information is provided to GigOptix by Distributor.

 

(ii) All quotations issued by GigOptix must be accepted or rejected by Distributor (a non-response will be deemed a rejection) within thirty (30) days from the date of the issuance of such quotation, and if accepted by Distributor, will remain valid for the remainder of the term of this Agreement. Once a quotation is accepted by Distributor (“Executed Quotation”), it will be deemed a part of this Agreement. Any change to price shall be notified to Distributor in writing at least thirty (30) days prior to the planned date of change and be subject to acceptance by Distributor.

(iii) Distributor shall issue a Purchase Order (“Purchase Order”) to GigOptix for any such quoted GigOptix Solution, Semiconductor Products, or services it wishes to order. Purchase Orders submitted will be accepted or rejected by GigOptix within five (5) business days.

(iv) Distributor shall be solely responsible for determining the price it sells the GigOptix Solution, Semiconductor Products, and services to its customers at its sole discretion, and may at its sole discretion, add shipping cost, interest, applicable taxes and any other markup.

(b)           Distributor shall pay GigOptix within 30 days from the date of invoice. All payments shall be made in United States dollars. Distributor shall at all times remain obligated to make payments to GigOptix, regardless as to whether Distributor receives payment from the customer. Unless otherwise agreed by GigOptix in writing, Distributor will make all payment by wire transfer to a bank account designated by GigOptix.

(c)           GigOptix’s prices do not include any national, state or local sales, use, value added or other taxes, customs duties, or similar tariffs and fees which GigOptix may be required to collect from Distributor upon the delivery of Semiconductor Products or upon collection of the license fees or otherwise. Should any tax or levy be made, Distributor agrees to pay such tax or levy. Distributor represents and warrants to GigOptix that all Semiconductor Products acquired hereunder are for redistribution in the ordinary course of Distributor’s business, and Distributor agrees to provide GigOptix with appropriate resale certificate numbers and other documentation satisfactory to the applicable taxing authorities to substantiate any claim of exemption from any such taxes or fees. Distributor will pay any withholding taxes required by applicable law. Distributor will supply GigOptix with evidence of such payment of withholding tax, in a form acceptable to GigOptix to meet the requirements for claiming foreign tax credits on GigOptix’s federal income tax return.

5.             Purchase Orders

(a)           All Purchase Orders for GigOptix’s Semiconductor Products placed by Distributor to GigOptix shall be in writing and shall be subject to acceptance in writing by GigOptix.

(b)           The terms and conditions of this Agreement and the Executed Quotation will apply to each Purchase Order accepted or shipped by GigOptix hereunder. Any terms, conditions or information appearing on any Purchase Orders or acknowledgments or related correspondence, other than the part number, price, quantity, ship-to address, shipping instructions and requested delivery date, will be of no effect unless expressly specified in this Agreement.

(c)           In the event that Distributor cancels a Purchase Order that has been accepted in writing by GigOptix:

 

(i) If the Purchase Order is for services (e.g. Non-Recurring Engineering (NRE) or setup), the cancellation charges will be as set forth in the statement of work that accompany the Purchase Order for such services.

(ii) Purchase Orders for Semiconductor Products cannot be cancelled, nor can they be returned once shipped by GigOptix, unless Distributor gives GigOptix the notice for cancellation at least sixty (60) days prior to the confirmed delivery date.

(d)           GigOptix reserves the right to charge rescheduling fees once a Purchase Order for Semiconductor Products has been accepted by GigOptix except as expressly set forth below. Rescheduling fees may include without limitation charges for work in progress or work already completed, and are immediately due and payable upon the request to reschedule. No fee will apply to the request to reschedule one particular item, per line item if it is made more than 2 weeks from the scheduled date of shipment to be delivered within the same calendar quarter.

6.             Shipment, Risk of Loss, and Delivery

GigOptix will use commercially reasonable efforts to ship Semiconductor Products to Distributor’s shipping address as set forth in the applicable purchase order by the delivery date specified by GigOptix. Distributor considers “On-Time-Delivery” to be zero (0) days early, and zero (0) days late with respect to GigOptix’s first scheduled delivery date.. All Semiconductor Products will be delivered ex works (Incoterms, 2000) GigOptix’s shipping point. Risk of loss will pass to Distributor when GigOptix makes Semiconductor Products available to the carrier at the shipping point. Distributor will pay all shipping charges, including without limitation transportation charges and insurance premiums, and will be responsible for all taxes, duties, and any other governmental assessment applicable to any shipment.

7.             Distribution Rights and Sales Representative Conversion

(a)           The design for Semiconductor Products can only originate in the Territory. The Distributor will have the right to distribute the Semiconductor Products on a worldwide basis.

(b)           There may exist special circumstances, e.g., the volume of shipments becomes too large for the Distributor to execute, or Contract Manufacturing moves to another country, where the Distributor is unable to fulfill all the responsibilities of the Distributor as described in Section 3. In such case and for a specific product, provided that both the Distributor and GigOptix mutually agree, there can be a change from a Distributor to a Sales Representative.

8.             Stock Rotation

Twice each calendar year, on February 1 and August 1, Distributor shall be entitled to exchange Semiconductor Products that are in Distributor’s inventory for Semiconductor Products of a different type that are then being currently produced by GigOptix. The following terms and conditions shall apply to such stock rotation:

(a)           Total dollar amount of the exchange, measured by the number of Semiconductor Products to be exchanged multiplied by Distributor’s purchase price, minus any previous price adjustments, and shall be no more than five percent (5%) of the Distributor’s previous six (6) months’ cumulative shipments from GigOptix.

 

(b)           All stock rotation proposals shall be accompanied by an offsetting purchase order for replacement Semiconductor Products. The dollar amount of this purchase order shall be equal to or greater than the dollar amount of the stock rotation proposal at Distributor cost.

9.             End of Life

In some circumstances, GigOptix will receive notification from one of its third party manufacturing partners of End of Life of one or more of the target fabrication technologies or packages used to manufacture product or due to business reasons, GigOptix decides to End of Life the Semiconductor Product. In either case, GigOptix will provide Distributor and its customer with at least one hundred and eighty (180) days advance written notification of its intention to designate End of Life of such Semiconductor Product, after which manufacturing capability for product will be terminated. Through its written notification, GigOptix will offer Distributor an option to place a last-time buy purchase order for product. Customer will have ninety (90) days from receipt of written notice to place last-time buy purchase orders. Deliveries of Semiconductor Product for last-time buys must be scheduled for shipment within six (6) months of order placement. Last-time buy orders must be placed in increments of full lot quantities. GigOptix reserves the right to ship all good material from final build lot. Distributor may exchange inventory of Semiconductor Products which have been End of Lifed pursuant to Section 8.

10.          Decommission.

If Distributor does not place a production order within a period of twelve (12) consecutive months for Semiconductor Products to GigOptix, GigOptix reserves the right to discontinue maintaining the manufacturing tooling including masks & test hardware/software required for manufacturing such Semiconductor Products and inform Distributor in writing ninety (90) days in advance that the Semiconductor Products will be expired. If a customer has a need to resurrect the expired Semiconductor Product in the future, GigOptix may be able to retool expired designs using its databases, subject to availability of these electronic databases. GigOptix will provide a quotation of NRE charges and production pricing if resurrection is feasible.

11.          Term and Termination

(a)           The initial term of this Agreement shall be 1 year commencing as of the Effective Date. At the end of such one-year period, this Agreement shall be renewed automatically for additional periods of one (1) year for each of the renewal unless either party provides written notice to the other party of its intention not to renew this Agreement, at least 60 days prior to the expiration of the original one-year period of this Agreement or any renewal thereof.

(b)           Either party may terminate this Agreement at any time prior to the expiration of its stated term in the event that the other party materially breaches this Agreement and such breach continues unremedied for a period of thirty (30) days following written notice of such failure or default.

(c)           This Agreement terminates automatically, with no further act or action of either party, if a receiver is appointed for either party or its property, either party makes an assignment for the benefit of its creditors, any proceedings are commenced by, for or against either party under any bankruptcy, insolvency or debtor’s relief law, or either party is liquidated or dissolved.

(d)           In the event that any notice of termination of this Agreement is given, GigOptix will be entitled to reject all or part of any orders received from Distributor after notice but prior to the effective date of termination if availability of Semiconductor Products is insufficient at that time to meet the needs of GigOptix and its customers fully. Notwithstanding any credit terms made available to Distributor prior to such notice, any Semiconductor Products shipped thereafter shall be paid for by certified or cashier’s check prior to shipment.

 

(e)           Upon termination or expiration of this Agreement:

(i) The due dates of all outstanding invoices to Distributor for Semiconductor Products automatically will be accelerated so they become due and payable on the effective date of termination, even if longer terms had been provided previously.

(ii) Distributor shall cease using any GigOptix trademark, trade name, logo or designation.

12.          Proprietary Information

(a)           GigOptix and Distributor acknowledge that, in the course of performing their duties under this Agreement, they may obtain the other party’s information that is of confidential and proprietary nature (collectively “Proprietary Information,” hereinafter referred to as “Proprietary Information”). Such Proprietary Information may include, without limitation, computer codes, trade secrets, know-how, inventions, techniques, processes, programs, algorithms, schematics, data, customer lists, financial information and sales and marketing plans. Both GigOptix and Distributor and their employees and agents shall, at all times, both during the term of this Agreement and after its termination, keep in trust and confidence all such Proprietary Information, and shall not use such Proprietary Information other than performing its duties under this Agreement, nor shall GigOptix and Distributor and their employees and agents disclose any such Proprietary Information to any person without the other party’s prior written consent.

(b)           GigOptix and Distributor and their employees and agents shall not be bound by subpart (a) of this Section with respect to information that (i) at the date hereof has entered or later enters the public domain as a result of no act or omission of GigOptix or Distributor or their employees and agents, (ii) is lawfully received from third parties without restriction on its disclosure, (iii) was lawfully in the possession of GigOptix or Distributor without restriction prior to its disclosure by GigOptix or Distributor, or (iv) was independently developed by GigOptix and Distributor and their employees and agents without access to the other party’s Proprietary Information.

(c)           The parties’ duty to protect Proprietary Information shall survive any expiration or termination of this Agreement, and shall extend for a period of three (3) years from the date of disclosure of the Proprietary Information.

(d)           GigOptix and Distributor shall return all Proprietary Information promptly upon expiration or termination of this Agreement, or upon any earlier request to do so made in writing by the other party.

(e)           Neither party shall disclose the terms and conditions of this Agreement to any third party without the other party’s prior approval in writing except that Distributor can disclose the existence of this Agreement to its potential customer only for purpose of promote the Semiconductor Products, GigOptix Solutions and related services . Notwithstanding the foregoing, each party may disclose the existence and content of this Agreement in confidence to its legal counsel, accountants, bankers and financing sources as necessary in connection with obtaining services from such third parties, provided such third parties are bound to confidentiality no less stringent than the provisions of this Agreement. Further, each party may disclose the existence and contents of this Agreement as required by the applicable rules and regulations of the Securities Exchange Commission or equivalent authority in any other relevant jurisdiction; subject, however, to the party taking reasonable steps consistent with such rules and regulations to minimize the scope and extent of the disclosure.

 

(f)           Nothing contained in this Agreement shall be construed as conferring any rights by implication, estoppel or otherwise, under any patent, copyright, trade secret or other intellectual property right, other than the rights expressly granted in this Agreement.

13.          Indemnity

(a)           Indemnification of Distributor. GigOptix will, at its expense, indemnify, defend and hold harmless Distributor and its customers against all costs and damages resulting from any claim based on an allegation:

(i) that Semiconductor Products, GigOptix Solutions or related services, as supplied or provided by GigOptix hereunder, infringes a patent, copyright or other intellectual property right of a third party, or

(ii) of any bodily injury or death of any customer of Distributor or other person caused by the willful or grossly negligent acts or omissions of GigOptix;

provided that Distributor (i) gives GigOptix prompt written notice of any such claim, (ii) allows GigOptix to direct the defense and settlement of the claims, and (iii) provides GigOptix with the information and assistance necessary for the defense and settlement of the claim. If a final injunction is obtained in an action based on any such claim against Distributor’s use or sale of a Semiconductor Products by reason of infringement, or if in GigOptix’s opinion such an injunction is likely to be obtained, GigOptix may, at its sole option, either (i) obtain for Distributor the right to continue using the Semiconductor Products, (ii) replace or modify the Semiconductor Products so that it becomes noninfringing, or (iii) if neither (i) nor (ii) can be reasonably effected by GigOptix, credit to Distributor the prices paid for the Semiconductor Products during the twelve (12) months prior to the credit, provided that such Semiconductor Products are returned to GigOptix in an undamaged condition.

(b)           No Combination Claims. Notwithstanding subpart (a) of this Section 13, GigOptix shall not be liable to Distributor for any claim arising from or based upon the combination, operation or use of any Semiconductor Products with equipment, data or programming not supplied by GigOptix, or arising from any alteration or modification of Semiconductor Products (so long as the Semiconductor Products do not independently constitute the infringement or cause such bodily injury or death without such combination, alternation or modification).

(c)           Limitation. THE PROVISIONS OF THIS SECTION SET FORTH THE ENTIRE LIABILITY OF COMPANY AND THE SOLE REMEDIES OF DISTRIBUTOR WITH RESPECT TO INFRINGEMENT AND ALLEGATIONS OF INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS OR OTHER PROPRIETARY RIGHTS OF ANY KIND IN CONNECTION WITH THE SERVICE, INSTALLATION, OPERATION, DESIGN, DISTRIBUTION OR USE OF THE GIGOPTIX SOLUTIONS OR SEMICONDUCTOR PRODUCTS.

14.          Warranty and Disclaimer

(a)           Warranty. Subject to this Agreement, GigOptix warrants that for the lesser of twelve (12) months from the date of shipment from Distributor to Distributor’s customer or fifteen (15) months from the date of shipment to Distributor by GigOptix, that the Semiconductor Products, as provided by GigOptix will materially conform to GigOptix’s specifications for such Semiconductor Products. Prototypes, samples and risk production (defined as a customer requested build, not built to the specifications or before verification is complete) are not covered by this warranty provided that any Prototypes, samples and risk production shall be clearly identified in the quotation from GigOptix with a statement of sold without warranty. Distributor’s sole remedy for breach of the foregoing warranty will be limited exclusively to Semiconductor Products replacement or, if replacement is inadequate as a remedy or is in GigOptix’s opinion impractical, refund of the purchase price for such Semiconductor Products. Distributor may ship Semiconductor Products returned under warranty claims to GigOptix’s designated facility only so long as the returns are in conformance with GigOptix’s then-current Return Material Authorization policy. Where warranty adjustment is made, GigOptix will pay for freight expenses Distributor shall pay for returned Semiconductor Products which are not defective or non-conforming together with the freight, testing and handling costs associated therewith. GigOptix shall have no obligations for breach of warranty if the alleged defect or non-conformance is found to have occurred as a result of misuse, neglect, improper installation or accident, or as a result of improper repair, alteration, storage, shipping or handling.

 

(b)           GigOptix represents and warrants that any gold, tantalum, tin or tungsten included in the Products provided to Distributor by GigOptix either (i) came from recycled or scrap sources or (ii) did not originate in the Democratic Republic of the Congo or an adjoining country. GigOptix will provide information and supporting documents to this effect as reasonably requested by Distributor.

(c)           Disclaimer. “”THE WARRANTY SET FORTH IN SECTION 14(a) IS IN LIEU OF, AND GIGOPTIX HEREBY DISCLAIMS, ALL OTHER WARRANTIES, WHETHER EXPRESS, IMPLIED OR STATUTORY, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, AND NONINFRINGEMENT.

(d)           Other. Distributor will make no warranty, guarantee or representation, whether written or oral, on GigOptix’s behalf.

15.          Trademark and Tradenames

(a)           Distributor acknowledges that GigOptix is the owner of certain trade names and trademarks. Distributor agrees to use such names and marks only in accordance with subpart (b) of this Section, and will not attempt to register such name or mark in its own name either during the period or after the termination of this Agreement.

(b)           GigOptix grants to Distributor for the period of this Agreement the right to use its trade names and the trademarks in connection with the sale, distribution, and servicing of the Semiconductor Products purchased under this Agreement and its advertising material relating to such Semiconductor Products, solely in accordance with the guidelines provided by GigOptix and the other terms and conditions of this Agreement. Distributor shall identify itself as an authorized Distributor of Semiconductor Products in connection with all activities related to such Semiconductor Products, and not to use any other trademark or name to identify such Semiconductor Products. Distributor shall not use such name or mark in any manner that might indicate that Distributor was other than an authorized Distributor acting as an independent contractor.

16.          Limitation of Liability

IN NO EVENT WILL GIGOPTIX OR DISTRIBUTOR BE LIABLE FOR ANY CONSEQUENTIAL, INDIRECT, EXEMPLARY, SPECIAL, OR INCIDENTAL DAMAGES, INCLUDING ANY LOST DATA AND LOST PROFITS, ARISING FROM OR RELATING TO THE PRODUCTS OR THIS AGREEMENT EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. EXCEPT FOR THE INDEMNIFICATION AS PROVIDED BY GIGOPTIX PURSUANT TO SECTION 13(a)(i), GIGOPTIX’S TOTAL CUMULATIVE LIABILITY IN CONNECTION WITH THIS AGREEMENT AND THE PRODUCT, WHETHER IN CONTRACT OR TORT OR OTHERWISE, WILL NOT EXCEED THE AMOUNT OF PRICES AND FEES PAID TO GIGOPTIX FOR THE SEMICONDUCTOR PRODUCTS, GIGOPTIX SOLUTIONS AND RELATED SERVICES IN THE MOST RECENT TWELVE MONTHS. DISTRIBUTOR ACKNOWLEDGES THAT THE PRICES AND FEES PAID TO IT REFLECT THE ALLOCATION OF RISK SET FORTH IN THIS AGREEMENT AND THAT GIGOPTIX WOULD NOT ENTER INTO THIS AGREEMENT WITHOUT THESE LIMITATIONS ON ITS LIABILITY. .

 

17.          General

(a)           Specific Uses. Distributors and its Customers using or selling GigOptix’s Semiconductor Products in life support equipment, nuclear products, or other applications where malfunction of a Semiconductor Products can reasonably be expected to result in a personal injury do so at their own risk and Distributor warrants it will not permit its Customers for such use or sell, or supply to any Customer that to its awareness will use or sell for use for such restricted purpose.

(b)           ITAR Compliance. All ITAR (ITAR 22 CFR 120-130, Non-Classified) requirements must be identified by Distributor’s Purchase Order and related change orders, and approved by GigOptix prior to processing the Distributor Purchase Order. Unclassified, Controlled/Accountable Items (U-C/AI) requirements must be identified by Distributor’s Purchase Order and related change orders, and approved by GigOptix prior to processing the Distributor Purchase Order.

(c)           Notices. Any notices required by the Agreement or this Agreement shall be sufficient only if dispatched by Email, facsimile, personally delivered, delivered by a major commercial rapid delivery courier, or mailed by certified or registered mail, return receipt requested.

(d)           Severability. If any provision of the Agreement or of this Agreement is held unenforceable by a court of competent jurisdiction, that provision shall be limited or eliminated to the minimum extent necessary so that this Agreement shall otherwise remain in full force and effect and enforceable.

(e)           Force Majeure. If in the performance of this Agreement, or any obligation hereunder except the making of payments hereunder is prevented, restricted or interfered with by reason of: fire, flood, earthquake, explosion, or other casualty or accident; strikes or labor disputes; inability to procure or obtain delivery of parts, supplies or power; war or other violence; any law, order, proclamation, regulation, ordinance, demand, or requirement of any government agency; or any other condition or act whatsoever beyond the reasonable control of the affected party, the party so affected, upon giving prompt notice to the other party, shall be excused from such performance to the extent of such prevention, restriction, or interference; provided, however, that the party so affected shall take all reasonable steps to avoid or remove such cause of nonperformance and shall resume performance hereunder with dispatch whenever such causes are removed.

(f)           Relationship of Parties. The parties hereto are independent contractors, and each is solely responsible for all of its employees and agents, labor costs, expenses and liabilities arising in connection therewith..

(g)           Controlling Law. This Agreement shall be governed by and constituted under the laws of the State of California, USA, without regard to any provision that would cause the laws of another jurisdiction to apply. The parties specifically disclaim the applicability of the United Nations Convention on Contracts for the International Sale of Goods.

 

(h)           Arbitration. All disputes under this Agreement (except as set forth below) will be submitted to final, binding arbitration under Rules of Arbitration of the International Chamber of Commerce (the “ICC Rules”). Either party may initiate arbitration by providing a written request for arbitration to the other party and to the International Chamber of Commerce. The arbitration will be held in Santa Clara County, California, USA. “” If the amount of the claim is less than US $1,000,000, the arbitration will be conducted by one arbitrator. If the amount in dispute is equal to or greater than US $1,000,000, the arbitration will be conducted by a panel of three arbitrators. The arbitrator or arbitrators will be selected in accordance with the Rules and must have expertise in the subject matter of the dispute. The arbitrator or arbitrators may award specific performance, injunctions, or other equitable relief. Judgment upon any arbitration award may be entered in any court with jurisdiction over either party. If either party fails to appear at any properly noticed arbitration proceeding, an award may be entered against the absent party. The parties will bear its own expenses in mediation, but will share all fees to ICC equally. Either party may seek equitable relief to enforce the rights granted in the Sections entitled “CONFIDENTIAL INFORMATION” or “OWNERSHIP” or to obtain a temporary restraining order or other provisional remedy to preserve the status quo or prevent irreparable harm. This Section 17(h) may be enforced by any court of competent jurisdiction, and a party seeking enforcement will be entitled to an award of all costs, fees and expenses, including attorney’s fees, to be paid by the party against whom enforcement is ordered.

(i)           Export Control. Distributor will at all times comply with all import and export laws, restrictions, and regulations of the United States and any applicable foreign agency or authority. Distributor will obtain all necessary licenses or exemptions for import export of any Semiconductor Products or other material deliverable by GigOptix to a location specified by Distributor, and will bear all expenses relating thereto. Upon GigOptix’s request, Distributor will demonstrate its compliance with all applicable laws and regulations prior to delivery of any Semiconductor Products or other material by GigOptix.

(j)           Amendment and Waiver. Any waivers or amendments to the Agreement or this Agreement shall be effective only if made in a writing that references this Agreement and that specifically states the intention of the parties to amend or waive the terms hereof and that is signed by an officer of GigOptix.

(k)           Attorneys’ Fees/Costs. The prevailing party in any action to enforce this Agreement shall be entitled to recover costs and expenses, including, without limitation, attorneys’ fees.

(l)           No Assignment. This Agreement is not assignable by Distributor without written consent of GigOptix, except to a person or entity who acquires all or substantially all of the assets or business of GigOptix, whether by sale, merger or otherwise. Any assignment in violation hereof shall be null and void.

(m)           Entire Agreement. This Agreement is the complete and entire agreement between GigOptix and Distributor respecting the subject matter hereof.

(n)           Choice of Language. The original of this Agreement has been written in English. Distributor waives any right it may have under the law of Distributor’s Territory to have this Agreement written in the language of Distributor’s Territory.

 

(o)           Due Execution. The party executing this Agreement on behalf of each party represents and warrants that he or she has been duly authorized to execute this Agreement on behalf of such party.

In witness of the above, each party to this Agreement has caused it to be executed, effective as of the date first written above.

 

	
GigOptix, Inc.

	 	
Avnet Asia Pte Ltd.

	 
	 	 	 	 	 	 	 	 
	
By

	 	Raluca Dinu	 	
By:

	 	
Jane Neo

	 
	 	 	
(Print Name)

	 	 	 	
(Print Name)

	 
	 	 	 	 	 	 	 	 
	
Title

	 	EVP Global Customer Operations	 	
Title:

	 	
VP, Asia for Material Management & Marcom

	 
	 	 	 	 	 	 	 	 
	
Signature

	 	/s/ RALUCA DINU	 	
Signature

	 	/s/ JANA NEO	 

 

EXHIBIT A

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