OTHER
MATTERS
Our
board is not aware of any matter to be presented for action at the Meeting other than the matters referred to above and does not intend
to bring any other matters before the Meeting. However, if other matters should come before the Meeting, it is intended that holders
of the proxies will vote thereon in their discretion.
General
The
accompanying proxy is solicited by and on behalf of the Board, whose Notice of Meeting is attached to this proxy statement, and the entire
cost of such solicitation will be borne by us. Our officers and selected employees may solicit proxies from stockholders. In addition
to the use of the mails, proxies may be solicited by personal interview, telephone and telegram by our directors, officers and other
employees who will not be specially compensated for these services. We will also request that brokers, nominees, custodians and other
fiduciaries forward soliciting materials to the beneficial owners of shares held of record by such brokers, nominees, custodians and
other fiduciaries. We will reimburse such persons for their reasonable expenses in connection therewith.
Certain
information contained in this proxy statement relating to the occupations and security holdings of our directors and officers is based
upon information received from the individual directors and officers.
WE
WILL FURNISH, WITHOUT CHARGE, A COPY OF OUR SEC REPORTS TO EACH OF OUR STOCKHOLDERS OF RECORD ON THE RECORD DATE AND TO EACH BENEFICIAL
STOCKHOLDER ON THAT DATE UPON WRITTEN REQUEST MADE TO OUR SECRETARY. A REASONABLE FEE WILL BE CHARGED FOR COPIES OF REQUESTED EXHIBITS.
Forward-Looking
Statements
This
proxy statement includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E
of the Exchange Act. You can identify forward-looking statements by the words “expects,” “projects,” “believes,”
“anticipates,” “intends,” “plans,” “predicts,” “estimates” and similar expressions.
The forward-looking statements are based on management’s current expectations, estimates and projections about the Company. The
Company cautions you that these statements are not guarantees of future performance and involve risks, uncertainties and assumptions
that it cannot predict. In addition, the Company based many of these forward-looking statements on assumptions about future events that
may prove to be inaccurate. Accordingly, actual outcomes and results may differ materially from what the Company has expressed or forecast
in the forward-looking statements. You should rely only on the information the Company has provided in this Proxy statement. The Company
has not authorized any person to provide information other than that provided herein. The Company has not authorized anyone to provide
you with different information. You should not assume that the information in this Proxy statement is accurate as of any date other than
the date at the top of the first page of this Proxy statement.
Where
You Can Find More Information
The
Company files annual, quarterly and special reports and other information with the SEC that can be inspected and copied at the public
reference facility maintained by the SEC at 100 F Street, N.E., Room 1580, Washington, D.C. 20549-0405. Information regarding the public
reference facilities may be obtained from the SEC by telephoning 1-800-SEC-0330. ‘s filings are also available through the SEC’s
Electronic Data Gathering Analysis and Retrieval System which is publicly available through the SEC’s website (www.sec.gov). Copies
of such materials may also be obtained by mail from the public reference section of the SEC at 100 F Street, N.E., Room 1850, Washington,
D.C. 20549-0405 at prescribed rates.
Stockholders
may obtain documents by requesting them in writing or by telephone (949) 281-2606 from the Company at the following address: 4101 North
Thanksgiving Way, Lehi, UT 84043.
BY
ORDER OF THE BOARD OF DIRECTORS |
|
| |
|
|
|
| James
Ballengee |
|
| Chief
Executive Officer |
|
ANNEX
I
CERTIFICATE
OF AMENDMENT
to
the
SECOND
AMENDED AND RESTATED
ARTICLES
OF INCORPORATION
OF
VIVAKOR,
INC.
VIVAKOR,
INC., a corporation organized and existing under the General Corporation Law of the State of Nevada (the “Corporation”),
does hereby certify as follows:
FIRST:
The name of the Corporation is Vivakor, Inc. The Corporation’s second amended and restated articles of incorporation was filed
with the Secretary of State of the State of Nevada on March 8, 2016 (the “Second Amended and Restated Articles of
Incorporation”).
SECOND:
The board of directors of the Corporation has duly adopted a resolution pursuant to Section 78.390 of the Nevada Revised Statutes setting
forth a proposed amendment to the Second Amended and Restated Articles of Incorporation of the Corporation (the “Certificate of
Amendment”) and declaring said amendment to be advisable. The requisite stockholders of the Corporation have duly approved said
proposed amendment in accordance with Section 78.320 and 78.390 of the Nevada Revised Statutes of the State of Nevada. The amendment
amends the Second Amended and Restated Articles of Incorporation of the Corporation as follows:
1.
The first paragraph of ARTICLE VI of the Corporation’s Second Amended and Restated Articles of Incorporation shall be deleted in
its entirety and replaced with the following:
“The
total number of shares of all classes of capital stock which the Corporation shall have authority to issue is 165,000,000, of which 15,000,000
shares shall be preferred stock, par value $0.001 per share, and 150,000,000 shares shall be common stock, par value $0.001 per share.”
2.
ARTICLE XV of the Corporation’s Second Amended and Restated Articles of Incorporation shall be deleted in its entirety and replaced
with the following:
“To
the fullest extent permitted by law, and unless the Corporation consents in writing to the selection of an alternative forum, the Eighth
Judicial District Court of Clark County, Nevada, shall, to the fullest extent permitted by law, be the sole and exclusive forum for state
law claims with respect to: (a) any derivative action or proceeding brought in the name or right of the Corporation or on its behalf,
(b) any action asserting a claim for breach of any fiduciary duty owed by any director, officer, employee or agent of the Corporation
to the Corporation or the Corporation’s stockholders, (c) any action arising or asserting a claim arising pursuant to any provision
of NRS Chapters 78 or 92A or any provision of these Second Amended and Restated Articles of Incorporation or the bylaws or (d) any action
asserting a claim governed by the internal affairs doctrine, including, without limitation, any action to interpret, apply, enforce or
determine the validity of these Second Amended and Restated Articles of Incorporation or the bylaws. For the avoidance of doubt, this
exclusive forum provision shall not be applicable to any action brought under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended. Any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of the
corporation shall be deemed to have notice of and consented to the provisions of this Article XV.
Nothing
herein contained shall be construed to preclude stockholders that assert claims under the Securities Act of 1933, as amended, or any
successor thereto or the Securities Exchange Act of 1934, as amended, from bringing such claims in state or federal court, subject to
applicable law. Furthermore, unless the Corporation consents in writing to the selection of an alternative forum, the federal district
courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising
under the Securities Act of 1933, as amended. Any person or entity purchasing or otherwise acquiring any interest in shares of capital
stock of the Corporation shall be deemed to have notice of and consented to the provisions of this Article XV.
If
any provision or provisions of this Article XV shall be held to be invalid, illegal or unenforceable as applied to any circumstance for
any reason whatsoever, (a) the validity, legality and enforceability of such provisions in any other circumstance and of the remaining
provisions of this Article XV (including, without limitation, each portion of any paragraph of this Article XV containing any such provision
held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) shall not in any way be
affected or impaired thereby and (b) the application of such provision to other persons or entities and circumstances shall not in any
way be affected or impaired thereby.”
3.
The vote by which the shareholders holding shares in the corporation entitling them to exercise at least a majority of the voting power,
or such greater proportion of the voting power as may be required in the case of a vote by classes or series, or as may be required by
the provisions of the Articles of Incorporation have voted in favor of the amendment is: [ ]%.
4.
Effective date of filing:
5.
Signature:
ANNEX
II
VIVAKOR,
INC.
2023
EQUITY AND INCENTIVE PLAN
SECTION 1.
GENERAL PURPOSE OF THE PLAN: DEFINITIONS
The
name of the plan is the VIVAKOR, INC. 2023 EQUITY AND INCENTIVE PLAN (the “Plan”). The purpose of the Plan is to encourage,
retain and enable the officers, employees, directors, Consultants and other key persons of VIVAKOR, INC., a Nevada corporation (including
any successor entity, the “Company”) and its Subsidiaries, upon whose judgment, initiative and efforts the Company largely
depends for the successful conduct of its business, to acquire a proprietary interest in the Company.
The
following terms shall be defined as set forth below:
“Affiliate”
of any Person means a Person that directly or indirectly, through one or more intermediaries, controls, is controlled by or is under
common control with the first mentioned Person. A Person shall be deemed to control another Person if such first Person possesses directly
or indirectly the power to direct, or cause the direction of, the management and policies of the second Person, whether through the ownership
of voting securities, by contract or otherwise.
“Award”
or “Awards,” except where referring to a particular category of grant under the Plan, shall include Incentive
Stock Options, Non-Qualified Stock Options, Stock Appreciation Rights (“SAR”), Restricted Stock Awards (including preferred
stock), Unrestricted Stock Awards, Restricted Stock Units, Performance Awards or any combination of the foregoing.
“Award
Agreement” means a written or electronic agreement setting forth the terms and provisions applicable to an Award granted under
the Plan. Each Award Agreement may contain terms and conditions in addition to those set forth in the Plan; provided, however, in the
event of any conflict in the terms of the Plan and the Award Agreement, the terms of the Plan shall govern.
“Board”
means the Board of Directors of the Company.
“Cause”
shall have the meaning as set forth in the Award Agreement(s). In the case that any Award Agreement does not contain a definition
of “Cause,” it shall mean (i) the grantee’s dishonest statements or acts with respect to the Company or any Affiliate
of the Company, or any current or prospective customers, suppliers vendors or other third parties with which such entity does business;
(ii) the grantee’s commission of (A) a felony or (B) any misdemeanor involving moral turpitude, deceit, dishonesty or fraud; (iii)
the grantee’s failure to perform his assigned duties and responsibilities to the reasonable satisfaction of the Company which failure
continues, in the reasonable judgment of the Company, after written notice given to the grantee by the Company; (iv) the grantee’s
gross negligence, willful misconduct or insubordination with respect to the Company or any Affiliate of the Company; or (v) the grantee’s
material violation of any provision of any agreement(s) between the grantee and the Company relating to noncompetition, nonsolicitation,
nondisclosure and/or assignment of inventions.
“Chief
Executive Officer” means the Chief Executive Officer of the Company or, if there is no Chief Executive Officer, then the President
of the Company.
“Code”
means the Internal Revenue Code of 1986, as amended, and any successor Code, and related rules, regulations and interpretations.
“Committee”
means the Committee of the Board referred to in Section 2.
“Consultant”
means any entity or natural person that provides bona fide services to the Company (including a Subsidiary), and such services are
not in connection with the offer or sale of securities in a capital-raising transaction and do not directly or indirectly promote or
maintain a market for the Company’s securities.
“Disability”
means such condition which renders a Person (A) unable to engage in any substantial gainful activity by reason of any medically determinable
physical or mental impairment that can be expected to result in death or can be expect to last for a continuous period of not less than
12 months, (B) by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be
expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than
3 months under an accident and health plan covering employees of the Company, (C) determined to be totally disabled by the Social Security
Administration, or (D) determined to be disabled under a disability insurance program which provides for a definition of disability that
meets the requirements of this section.
“Effective
Date” means the date on which the Plan is adopted as set forth in this Plan.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.
“Fair
Market Value” of the Stock on any given date means the fair market value of the Stock determined in good faith by the Committee
based on the reasonable application of a reasonable valuation method that is consistent with Section 409A of the Code. If the Stock
is admitted to trade on a national securities exchange, the determination shall be made by reference to the closing price reported on
such exchange. If there is no closing price for such date, the determination shall be made by reference to the last date preceding such
date for which there is a closing price. If the date for which Fair Market Value is determined is the first day when trading prices for
the Stock are reported on a national securities exchange, the Fair Market Value shall be the “Price to the Public” (or equivalent).
“Good
Reason” shall have the meaning as set forth in the Award Agreement(s). In the case that any Award Agreement does not contain
a definition of “Good Reason,” it shall mean (i) a material diminution in the grantee’s base salary except for across-the-board
salary reductions similarly affecting all or substantially all similarly situated employees of the Company or (ii) a change of more than
100 miles in the geographic location at which the grantee provides services to the Company, so long as the grantee provides at least
90 days’ notice to the Company following the initial occurrence of any such event and the Company fails to cure such event within
30 days thereafter.
“Grant
Date” means the date that the Committee designates in its approval of an Award in accordance with applicable law as the date
on which the Award is granted, which date may not precede the date of such Committee approval.
“Holder”
means, with respect to an Award or any Shares, the Person holding such Award or Shares, including the initial recipient of the Award
or any Permitted Transferee.
“Incentive
Stock Option” means any Stock Option designated and qualified as an “incentive stock option” as defined in Section 422
of the Code.
“Non-Qualified
Stock Option” means any Stock Option that is not an Incentive Stock Option.
“Option”
or “Stock Option” means any option to purchase shares of Stock granted pursuant to Section 5.
“Permitted
Transferees” shall mean any of the following to whom a Holder may transfer Shares hereunder (as set forth in Section 10(a)(ii)(A)):
the Holder’s child, stepchild, grandchild, parent, step-parent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships, any person sharing the
Holder’s household (other than a tenant or employee), a trust in which these persons have more than fifty percent of the beneficial
interest, a foundation in which these persons control the management of assets, and any other entity in which these persons own more
than fifty percent of the voting interests; provided, however, that any such trust does not require or permit distribution of any Shares
during the term of the Award Agreement unless subject to its terms. Upon the death of the Holder, the term Permitted Transferees shall
also include such deceased Holder’s estate, executors, administrators, personal representatives, heirs, legatees and distributees,
as the case may be.
“Person”
shall mean any individual, corporation, partnership (limited or general), limited liability company, limited liability partnership,
association, trust, joint venture, unincorporated organization or any similar entity.
“Restricted
Stock Award” means Awards granted pursuant to Section 7 and “Restricted Stock” means Shares issued pursuant
to such Awards.
“Restricted
Stock Unit” means an Award of phantom stock units to a grantee, which may be settled in cash or Shares as determined by the
Committee, pursuant to Section 9.
“Sale
Event” means the consummation of i) a change in the ownership of the Company, ii) a change in effective control of the Company,
or iii) a change in the ownership of a substantial portion of the assets of the Company. The occurrence of a Sale Event shall be acknowledged
by the plan administrator or board of directors, by strictly applying these provisions without any discretion to deviate from the objective
application of the definitions provided herein.; provided, however, that any capital raising event, or a merger effected solely to change
the Company’s domicile shall not constitute a “Sale Event.”
Except
as otherwise provided herein, a change in the ownership of the Company occurs on the date that any one person, or more than one person
acting as a group acquires ownership of stock of the Company that, together with stock held by such person or group, constitutes more
than 50 percent of the total fair market value or total voting power of the stock of the Company. However, if any one person, or more
than one person acting as a group, is considered to own more than 50 percent of the total fair market value or total voting power of
the stock of the Company the acquisition of additional stock by the same person or persons is not considered to cause a change in the
ownership of the Company (or to cause a change in the effective control of the Company). An increase in the percentage of stock owned
by any one person, or persons acting as a group, as a result of a transaction in which the corporation acquires its stock in exchange
for property will be treated as an acquisition of stock for purposes of this section. This section applies only when there is a transfer
of stock of the Company (or issuance of stock) which remains outstanding after the transaction.
A
change in the effective control of the Company occurs only on either of the following dates: (1) The date any one person, or more than
one person acting as a group acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by
such person or persons) ownership of stock of the Company possessing 30 percent or more of the total voting power of the stock of the
Company; (2) The date a majority of members of the Company’s board of directors is replaced during any 12-month period by directors
whose appointment or election is not endorsed by a majority of the members of the Company’s board of directors before the date
of the appointment or election.
A
change in the ownership of a substantial portion of the Company’s assets occurs on the date that any one person, or more than one
person acting as a group acquires (or has acquired during the 12- month period ending on the date of the most recent acquisition by such
person or persons) assets from the Company that have a total gross fair market value equal to or more than 40 percent of the total gross
fair market value of all of the assets of the Company immediately before such acquisition or acquisitions. For this purpose, gross fair
market value means the value of the assets of the corporation, or the value of the assets being disposed of, determined without regard
to any liabilities associated with such assets.
“Section 409A”
means Section 409A of the Code and the regulations and other guidance promulgated thereunder.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations thereunder.
“Service
Relationship” means any relationship as a full-time employee, part-time employee, director or other key person (including Consultants)
of the Company or any Subsidiary or any successor entity (e.g., a Service Relationship shall be deemed to continue without interruption
in the event an individual’s status changes from full-time employee to part-time employee or Consultant).
“Shares”
means shares of Stock.
“Stock”
means the Common Stock, par value $0.001 per share, of the Company.
“Stock
Appreciation Right” or “SAR” means any right to receive from the Company upon exercise by an optionee or settlement,
in cash, Shares, or a combination thereof, the excess of (i) the Fair Market Value of one Share on the date of exercise or settlement
over (ii) the exercise price of the right on the date of grant, or if granted in connection with an Option, on the date of grant of the
Option.
“Subsidiary”
means any corporation or other entity (other than the Company) in which the Company has more than a 50 percent interest, either directly
or indirectly.
“Ten
Percent Owner” means an employee who owns or is deemed to own (by reason of the attribution rules of Section 424(d) of
the Code) more than 10 percent of the combined voting power of all classes of stock of the Company or any parent of the Company or any
Subsidiary.
“Termination
Event” means the termination of the Award recipient’s Service Relationship with the Company and its Subsidiaries for
any reason whatsoever, regardless of the circumstances thereof, and including, without limitation, upon death, disability, retirement,
discharge or resignation for any reason, whether voluntarily or involuntarily. The following shall not constitute a Termination Event:
(i) a transfer to the service of the Company from a Subsidiary or from the Company to a Subsidiary, or from one Subsidiary to another
Subsidiary or (ii) an approved leave of absence for military service or sickness, or for any other purpose approved by the Committee,
if the individual’s right to re-employment is guaranteed either by a statute or by contract or under the policy pursuant to which
the leave of absence was granted or if the Committee otherwise so provides in writing.
“Unrestricted
Stock Award” means any Award granted pursuant to Section 8 and “Unrestricted Stock” means Shares issued pursuant
to such Awards.
SECTION 2.
ADMINISTRATION OF PLAN; COMMITTEE AUTHORITY TO SELECT GRANTEES AND DETERMINE AWARDS
(a)
Administration of Plan. The Plan shall be administered by the Compensation Committee of the Board, comprised of not less than
three directors or the Board of Directors in the absence of a Compensation Committee of the Board. All references herein to the “Committee”
shall be deemed to refer to the group then responsible for administration of the Plan at the relevant time (i.e., either the Board of
Directors or a committee or committees of the Board, as applicable).
(b)
Powers of Committee. The Committee shall have the power and authority to grant Awards consistent with the terms of the Plan, including
the power and authority:
(i)
to select the individuals to whom Awards may from time to time be granted;
(ii)
to determine the time or times of grant, and the amount, if any, of Incentive Stock Options, Non-Qualified Stock Options, SARs, Restricted
Stock Awards, Unrestricted Stock Awards, Restricted Stock Units, or any combination of the foregoing, granted to any one or more grantees;
(iii)
to determine the number and types of Shares to be covered by any Award and, subject to the provisions of the Plan, the price, exercise
price, conversion ratio or other price relating thereto;
(iv)
to determine and, subject to Section 13, to modify from time to time the terms and conditions, including restrictions, not inconsistent
with the terms of the Plan, of any Award, which terms and conditions may differ among individual Awards and grantees, and to approve
the form of Award Agreements;
(v)
to accelerate at any time the exercisability or vesting of all or any portion of any Award;
(vi)
to impose any limitations on Awards, including limitations on transfers, repurchase provisions and the like, and to exercise repurchase
rights or obligations;
(vii)
subject to Section 5(a)(ii) and any restrictions imposed by Section 409A, to extend
at any time the period in which Stock Options may be exercised; and
(viii)
at any time to adopt, alter and repeal such rules, guidelines and practices for administration of the Plan and for its own acts and proceedings
as it shall deem advisable; to interpret the terms and provisions of the Plan and any Award (including Award Agreements); to make all
determinations it deems advisable for the administration of the Plan; to decide all disputes arising in connection with the Plan; and
to otherwise supervise the administration of the Plan.
All
decisions and interpretations of the Committee shall be binding on all persons, including the Company and all Holders.
(c)
Award Agreement. Awards under the Plan shall be evidenced by Award Agreements that set forth the terms, conditions and limitations
for each Award.
(d)
Indemnification. Neither the Board nor the Committee, nor any member of either or any delegate thereof, shall be liable for any
act, omission, interpretation, construction or determination made in good faith in connection with the Plan, and the members of the Board
and the Committee (and any delegate thereof) shall be entitled in all cases to indemnification and reimbursement by the Company in respect
of any claim, loss, damage or expense (including, without limitation, reasonable attorneys’ fees) arising or resulting therefrom
to the fullest extent permitted by law and/or under the Company’s governing documents, including its certificate of incorporation
or bylaws, or any directors’ and officers’ liability insurance coverage which may be in effect from time to time and/or any
indemnification agreement between such individual and the Company.
(e)
Foreign Award Recipients. Notwithstanding any provision of the Plan to the contrary, in order to comply with the laws in other
countries in which the Company and any Subsidiary operate or have employees or other individuals eligible for Awards, the Committee,
in its sole discretion, shall have the power and authority to: (i) determine which Subsidiaries, if any, shall be covered by the Plan;
(ii) determine which individuals, if any, outside the United States are eligible to participate in the Plan; (iii) modify the terms and
conditions of any Award granted to individuals outside the United States to comply with applicable foreign laws; (iv) establish subplans
and modify exercise procedures and other terms and procedures, to the extent the Committee determines such actions to be necessary or
advisable (and such subplans and/or modifications shall be attached to the Plan as appendices); provided, however, that no such subplans
and/or modifications shall increase the share limitation contained in Section 3(a) hereof; and (v) take any action, before or after
an Award is made, that the Committee determines to be necessary or advisable to obtain approval or comply with any local governmental
regulatory exemptions or approvals.
SECTION 3.
STOCK ISSUABLE UNDER THE PLAN; MERGERS AND OTHER TRANSACTIONS; SUBSTITUTION
(a) Stock
Issuable. The maximum number of Shares reserved and available for issuance under the Plan shall be 10,000,000 Shares (the
“Share Reserve”), subject to adjustment as provided in Section 3(b) and the following sentence regarding the annual
increase. In addition, the Share Reserve will automatically increase on January 1st of each year, for a period of not more than
ten years, commencing on January 1, 2024, and ending on (and including) January 1, 2033, in an amount equal to 1,000,000
shares. Notwithstanding the foregoing, the Board may act prior to January 1st of a given year to provide that there will be no
January 1st increase in the Share Reserve for such year or that the increase in the Share Reserve for such year will be a
lesser number of shares of Stock than would otherwise occur pursuant to the preceding sentence. If a Stock Award or any portion
thereof (i) expires or otherwise terminates without all of the shares covered by such Stock Award having been issued or (ii) is
settled in cash (i.e., the Participant receives cash rather than stock), the Shares subject to such Stock Award, to the extent of
any such expiration, termination or settlement, will again be available for issuance under the Plan. If any shares of Stock issued
pursuant to a Stock Award are forfeited back to or repurchased by the Company because of the failure to meet a contingency or
condition required to vest such shares in the Participant, then the shares that are forfeited or repurchased will revert to and
again become available for issuance under the Plan. Any shares reacquired by the Company in satisfaction of tax withholding
obligations on a Stock Award or as consideration for the exercise or purchase price of a Stock Award will again become available for
issuance under the Plan. For purposes of this limitation, the Shares underlying any Awards that are forfeited, canceled, reacquired
by the Company prior to vesting, satisfied without the issuance of Stock or otherwise terminated (other than by exercise) shall be
added back to the Shares available for issuance under the Plan. Subject to such overall limitations, Shares may be issued up to such
maximum number pursuant to any type or types of Award, and no more than 2,000,000 Shares may be issued pursuant to Incentive Stock
Options. The value of any Shares granted to a non-employee director of the Company, solely for services as a director, when added to
any annual cash payments or awards, shall not exceed an aggregate value of four hundred thousand dollars ($400,000) in any
calendar year.
(b)
Changes in Stock. Subject to Section 3(c) hereof, if, as a result of any reorganization, recapitalization, reclassification,
stock dividend, stock split, reverse stock split or other similar change in the Company’s capital stock, the outstanding Shares
are increased or decreased or are exchanged for a different number or kind of shares or other securities of the Company, or additional
Shares or new or different shares or other securities of the Company or other non-cash assets are distributed with respect to such Shares
or other securities, in each case, without the receipt of consideration by the Company, or, if, as a result of any merger or consolidation,
or sale of all or substantially all of the assets of the Company, the outstanding Shares are converted into or exchanged for other securities
of the Company or any successor entity (or a parent or subsidiary thereof), the Committee shall make an appropriate and proportionate
adjustment in (i) the maximum number of Shares reserved for issuance under the Plan, (ii) the number and kind of Shares or other securities
subject to any then outstanding Awards under the Plan, (iii) the repurchase price, if any, per Share subject to each outstanding Award,
and (iv) the exercise price for each Share subject to any then outstanding Stock Options under the Plan, without changing the aggregate
exercise price (i.e., the exercise price multiplied by the number of Stock Options) as to which such Stock Options remain exercisable.
The Committee shall in any event make such adjustments as may be required by the laws of Nevada and the rules and regulations promulgated
thereunder. The adjustment by the Committee shall be final, binding and conclusive. No fractional Shares shall be issued under the Plan
resulting from any such adjustment, but the Committee in its discretion may make a cash payment in lieu of fractional shares.
(c)
Sale Events.
(i)
Options.
(A)
In the case of and subject to the consummation of a Sale Event, the Plan and all outstanding Options and SARs issued hereunder shall
become one hundred percent (100%) vested upon the effective time of any such Sale Event. New stock options or other awards of the successor
entity or parent thereof shall be substituted therefor, with an equitable or proportionate adjustment as to the number and kind of shares
and, if appropriate, the per share exercise prices, as such parties shall agree (after taking into account any acceleration hereunder
and/or pursuant to the terms of any Award Agreement).
(B)
In the event of the termination of the Plan and all outstanding Options and SARs issued hereunder pursuant to Section 3(c), each
Holder of Options shall be permitted, within a period of time prior to the consummation of the Sale Event as specified by the Committee,
to exercise all such Options or SARs which are then exercisable or will become exercisable as of the effective time of the Sale Event;
provided, however, that the exercise of Options not exercisable prior to the Sale Event shall be subject to the consummation of the Sale
Event.
(C)
Notwithstanding anything to the contrary in Section 3(c)(i)(A), in the event of a Sale Event, the Company shall have the right,
but not the obligation, to make or provide for a cash payment to the Holders of Options, without any consent of the Holders, in exchange
for the cancellation thereof, in an amount equal to the difference between (A) the value as determined by the Committee of the consideration
payable per share of Stock pursuant to the Sale Event (the “Sale Price”) times the number of Shares subject to outstanding
Options being cancelled (to the extent then vested and exercisable, including by reason of acceleration in connection with such Sale
Event, at prices not in excess of the Sale Price) and (B) the aggregate exercise price of all such outstanding vested and exercisable
Options.
(ii)
Restricted Stock and Restricted Stock Unit Awards.
(A)
In the case of and subject to the consummation of a Sale Event, all unvested Restricted Stock and unvested Restricted Stock Unit Awards
issued hereunder shall become one hundred percent (100%) vested, with an equitable or proportionate adjustment as to the number and kind
of shares subject to such awards as such parties shall agree (after taking into account any acceleration hereunder and/or pursuant to
the terms of any Award Agreement).
(B)
Such Restricted Stock shall be repurchased from the Holder thereof at the then Fair Market Value of such shares, (subject to adjustment
as provided in Section 3(b)) for such Shares.
(C)
Notwithstanding anything to the contrary in Section 3(c)(ii)(A), in the event of a Sale Event, the Company shall have the right,
but not the obligation, to make or provide for a cash payment to the Holders of Restricted Stock or Restricted Stock Unit Awards, without
consent of the Holders, in exchange for the cancellation thereof, in an amount equal to the Sale Price times the number of Shares subject
to such Awards, to be paid at the time of such Sale Event or upon the later vesting of such Awards.
SECTION 4.
ELIGIBILITY
Grantees
under the Plan will be such full or part-time officers and other employees, directors, Consultants and key persons of the Company and
any Subsidiary who are selected from time to time by the Committee in its sole discretion; provided, however, that Awards shall be granted
only to those individuals described in Rule 701(c) of the Securities Act.
SECTION 5.
STOCK OPTIONS
Upon
the grant of a Stock Option, the Company and the grantee shall enter into an Award Agreement. The terms and conditions of each such Award
Agreement shall be determined by the Committee, and such terms and conditions may differ among individual Awards and grantees.
Stock
Options granted under the Plan may be either Incentive Stock Options or Non-Qualified Stock Options. Incentive Stock Options may be granted
only to employees of the Company or any Subsidiary that is a “subsidiary corporation” within the meaning of Section 424(f)
of the Code. To the extent that any Option does not qualify as an Incentive Stock Option, it shall be deemed a Non-Qualified Stock Option.
(a)
Terms of Stock Options. The Committee in its discretion may grant Stock Options to those individuals who meet the eligibility
requirements of Section 4. Stock Options shall be subject to the following terms and conditions and shall contain such additional
terms and conditions, not inconsistent with the terms of the Plan, as the Committee shall deem desirable.
(i)
Exercise Price. The exercise price per share for the Shares covered by a Stock Option shall be determined by the Committee at
the time of grant but shall not be less than 100 percent of the Fair Market Value on the Grant Date. In the case of an Incentive Stock
Option that is granted to a Ten Percent Owner, the exercise price per share for the Shares covered by such Incentive Stock Option shall
not be less than 110 percent of the Fair Market Value on the Grant Date.
(ii)
Option Term. The term of each Stock Option shall be fixed by the Committee, but no Stock Option shall be exercisable more than
ten years from the Grant Date. In the case of an Incentive Stock Option that is granted to a Ten Percent Owner, the term of such Stock
Option shall be no more than five years from the Grant Date.
(iii)
Exercisability; Rights of a Stockholder. Stock Options shall become exercisable and/or vested at such time or times, whether or
not in installments, as shall be determined by the Committee at or after the Grant Date. The Award Agreement may permit a grantee to
exercise all or a portion of a Stock Option immediately at grant; provided that the Shares issued upon such exercise shall be subject
to restrictions and a vesting schedule identical to the vesting schedule of the related Stock Option, such Shares shall be deemed to
be Restricted Stock for purposes of the Plan, and the optionee may be required to enter into an additional or new Award Agreement as
a condition to exercise of such Stock Option. An optionee shall have the rights of a stockholder only as to Shares acquired upon the
exercise of a Stock Option and not as to unexercised Stock Options. An optionee shall not be deemed to have acquired any Shares unless
and until a Stock Option shall have been exercised pursuant to the terms of the Award Agreement and this Plan and the optionee’s
name has been entered on the books of the Company as a stockholder.
(iv)
Method of Exercise. Stock Options may be exercised by an optionee in whole or in part, by the optionee giving written or electronic
notice of exercise to the Company, specifying the number of Shares to be purchased. Payment of the purchase price may be made by one
or more of the following methods (or any combination thereof) to the extent provided in the Award Agreement:
(A)
In cash, by certified or bank check, by wire transfer of immediately available funds, or other instrument acceptable to the Committee;
(B)
If permitted by the Committee, by the optionee delivering to the Company a promissory note, if the Board has expressly authorized the
loan of funds to the optionee for the purpose of enabling or assisting the optionee to effect the exercise of his or her Stock Option;
provided, that at least so much of the exercise price as represents the par value of the Stock shall be paid in cash if required by state
law;
(C)
If permitted by the Committee, through the delivery (or attestation to the ownership) of Shares that have been purchased by the optionee
on the open market or that are beneficially owned by the optionee and are not then subject to restrictions under any Company plan. To
the extent required to avoid variable accounting treatment under applicable accounting rules, such surrendered Shares if originally purchased
from the Company shall have been owned by the optionee for at least six months. Such surrendered Shares shall be valued at Fair Market
Value on the exercise date;
(D)
If permitted by the Committee and by the optionee delivering to the Company a properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Company cash or a check payable and acceptable to the Company for the purchase price;
provided that in the event the optionee chooses to pay the purchase price as so provided, the optionee and the broker shall comply with
such procedures and enter into such agreements of indemnity and other agreements as the Committee shall prescribe as a condition of such
payment procedure; or
(E)
If permitted by the Committee, and only with respect to Stock Options that are not Incentive Stock Options, by a “net exercise”
arrangement pursuant to which the Company will reduce the number of Shares issuable upon exercise by the largest whole number of Shares
with a Fair Market Value that does not exceed the aggregate exercise price.
Payment
instruments will be received subject to collection. No certificates for Shares so purchased will be issued to the optionee or, with respect
to uncertificated Stock, no transfer to the optionee on the records of the Company will take place, until the Company has completed all
steps it has deemed necessary to satisfy legal requirements relating to the issuance and sale of the Shares, which steps may include,
without limitation, (i) receipt of a representation from the optionee at the time of exercise of the Option that the optionee is purchasing
the Shares for the optionee’s own account and not with a view to any sale or distribution of the Shares or other representations
relating to compliance with applicable law governing the issuance of securities, (ii) the legending of the certificate (or notation on
any book entry) representing the Shares to evidence the foregoing restrictions, and (iii) obtaining from optionee payment or provision
for all withholding taxes due as a result of the exercise of the Option. The delivery of certificates representing the shares of Stock
(or the transfer to the optionee on the records of the Company with respect to uncertificated Stock) to be purchased pursuant to the
exercise of a Stock Option will be contingent upon (A) receipt from the optionee (or a purchaser acting in his or her stead in accordance
with the provisions of the Stock Option) by the Company of the full purchase price for such Shares and the fulfillment of any other requirements
contained in the Award Agreement or applicable provisions of laws and (B) if required by the Company, the optionee shall have entered
into any stockholders agreements or other agreements with the Company and/or certain other of the Company’s stockholders relating
to the Stock. In the event an optionee chooses to pay the purchase price by previously-owned Shares through the attestation method, the
number of Shares transferred to the optionee upon the exercise of the Stock Option shall be net of the number of Shares attested to by
the Optionee.
(b)
Annual Limit on Incentive Stock Options. To the extent required for “incentive stock option” treatment under Section 422
of the Code, the aggregate Fair Market Value (determined as of the Grant Date) of the Shares with respect to which Incentive Stock Options
granted under the Plan and any other plan of the Company or its parent and any Subsidiary that become exercisable for the first time
by an optionee during any calendar year shall not exceed $100,000 or such other limit as may be in effect from time to time under Section 422
of the Code. To the extent that any Stock Option exceeds this limit, it shall constitute a Non-Qualified Stock Option.
(c)
Termination. Any portion of a Stock Option that is not vested and exercisable on the date of termination of an optionee’s
Service Relationship shall immediately expire and be null and void. Once any portion of the Stock Option becomes vested and exercisable,
the optionee’s right to exercise such portion of the Stock Option (or the optionee’s representatives and legatees as applicable)
in the event of a termination of the optionee’s Service Relationship shall continue until the earliest of: (i) the date which is:
(A) 12 months following the date on which the optionee’s Service Relationship terminates due to death or Disability (or such longer
period of time as determined by the Committee and set forth in the applicable Award Agreement), or (B) three months following the date
on which the optionee’s Service Relationship terminates if the termination is due to any reason other than death or Disability
(or such longer period of time as determined by the Committee and set forth in the applicable Award Agreement), or (ii) the Expiration
Date set forth in the Award Agreement; provided that notwithstanding the foregoing, an Award Agreement may provide that if the optionee’s
Service Relationship is terminated for Cause, the Stock Option shall terminate immediately and be null and void upon the date of the
optionee’s termination and shall not thereafter be exercisable.
SECTION 6.
STOCK APPRECIATION RIGHTS
The
Committee is authorized to grant SARs to optionees with the following terms and conditions and with such additional terms and conditions,
in either case not inconsistent with the provisions of the Plan, as the Committee shall determine –
(a)
SARs may be granted under the Plan to optionees either alone or in addition to other Awards granted under the Plan and may, but need
not, relate to specific Option granted under Section 5.
(b)
The exercise price per Share under a SAR shall be determined by the Committee, provided, however, that except in the case of a substitute
Award, such exercise price shall not be less than the fair market value of a Share on the date of grant of such SAR.
(c)
The term of each SAR shall be fixed by the Committee but shall not exceed 10 years from the date of grant of such SAR.
(d)
The Committee shall determine the time or times at which a SAR may be exercised or settled in whole or in part. Unless otherwise determined
by the Committee or unless otherwise set forth in an Award Agreement, the provisions set forth in Section 5 above with respect to
exercise of an Award following termination of service shall apply to any SAR. The Committee may specify in an Award Agreement that an
“in-the-money” SAR shall be automatically exercised on its expiration date.
SECTION 7.
RESTRICTED STOCK AWARDS
(a)
Nature of Restricted Stock Awards. The Committee may, in its sole discretion, grant (or sell at par value or such other purchase
price determined by the Committee) to an eligible individual under Section 4 hereof a Restricted Stock Award under the Plan. The
Committee shall determine the restrictions and conditions applicable to each Restricted Stock Award at the time of grant. Conditions
may be based on the type of stock upon which restrictions are placed, continuing employment (or other Service Relationship), achievement
of pre-established performance goals and objectives and/or such other criteria as the Committee may determine. Upon the grant of a Restricted
Stock Award, the Company and the grantee shall enter into an Award Agreement. The terms and conditions of each such Award Agreement shall
be determined by the Committee, and such terms and conditions may differ among individual Awards and grantees.
(b)
Rights as a Stockholder. Upon the grant of the Restricted Stock Award and payment of any applicable purchase price, a grantee
of Restricted Stock shall be considered the record owner of and shall be entitled to vote the Restricted Stock if, and to the extent,
such Shares are entitled to voting rights, subject to such conditions contained in the Award Agreement. The grantee shall be entitled
to receive all dividends and any other distributions declared on the Shares; provided, however, that the Company is under no duty to
declare any such dividends or to make any such distribution. Unless the Committee shall otherwise determine, certificates evidencing
the Restricted Stock shall remain in the possession of the Company until such Restricted Stock is vested as provided in subsection (d)
below of this Section, and the grantee shall be required, as a condition of the grant, to deliver to the Company a stock power endorsed
in blank and such other instruments of transfer as the Committee may prescribe.
(c)
Restrictions. Restricted Stock may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed of except as
specifically provided herein or in the Award Agreement. Except as may otherwise be provided by the Committee either in the Award Agreement
or, subject to Section 13 below, in writing after the Award Agreement is issued, if a grantee’s Service Relationship with
the Company and any Subsidiary terminates, the Company or its assigns shall have the right, as may be specified in the relevant instrument,
to repurchase some or all of the Shares subject to the Award at such purchase price as is set forth in the Award Agreement.
(d)
Vesting of Restricted Stock. The Committee at the time of grant shall specify in the Award Agreement the date or dates and/or
the attainment of pre-established performance goals, objectives and other conditions on which the substantial risk of forfeiture imposed
shall lapse and the Restricted Stock shall become vested, subject to such further rights of the Company or its assigns as may be specified
in the Award Agreement.
SECTION 8.
UNRESTRICTED STOCK AWARDS
The
Committee may, in its sole discretion, grant (or sell at par value or such other purchase price determined by the Committee) to an eligible
person under Section 4 hereof an Unrestricted Stock Award under the Plan. Unrestricted Stock Awards may be granted in respect of
past services or other valid consideration, or in lieu of cash compensation due to such grantee.
SECTION 9.
RESTRICTED STOCK UNITS
(a)
Nature of Restricted Stock Units. The Committee may, in its sole discretion, grant to an eligible person under Section 4
hereof Restricted Stock Units under the Plan. The Committee shall determine the restrictions and conditions applicable to each Restricted
Stock Unit at the time of grant. Vesting conditions may be based on continuing employment (or other Service Relationship), achievement
of pre-established performance goals and objectives which may be based on targets for revenue, revenue growth, EBITDA, net income, earnings
per share and/or other such criteria as the Committee may determine. Upon the grant of Restricted Stock Units, the grantee and the Company
shall enter into an Award Agreement. The terms and conditions of each such Award Agreement shall be determined by the Committee and may
differ among individual Awards and grantees. On or promptly following the vesting date or dates applicable to any Restricted Stock Unit,
but in no event later than March 15 of the year following the year in which such vesting occurs, such Restricted Stock Unit(s) shall
be settled in the form of cash or shares of Stock, as specified in the Award Agreement. Restricted Stock Units may not be sold, assigned,
transferred, pledged, or otherwise encumbered or disposed of.
(b)
Rights as a Stockholder. A grantee shall have the rights of a stockholder only as to Shares, if any, acquired upon settlement
of Restricted Stock Units. A grantee shall not be deemed to have acquired any such Shares unless and until the Restricted Stock Units
shall have been settled in Shares pursuant to the terms of the Plan and the Award Agreement, the Company shall have issued and delivered
a certificate representing the Shares to the grantee (or transferred on the records of the Company with respect to uncertificated stock),
and the grantee’s name has been entered in the books of the Company as a stockholder.
(c)
Termination. Except as may otherwise be provided by the Committee either in the Award Agreement or in writing after the Award
Agreement is issued, a grantee’s right in all Restricted Stock Units that have not vested shall automatically terminate upon the
grantee’s cessation of Service Relationship with the Company and any Subsidiary for any reason.
SECTION 10.
TRANSFER RESTRICTIONS; COMPANY RIGHT OF FIRST REFUSAL; COMPANY REPURCHASE RIGHTS
(a)
Restrictions on Transfer.
(i)
Non-Transferability of Certain Awards. Restricted Stock awards granted under Section 7, Stock Options, SARs and, prior to
exercise, the Shares issuable upon exercise of such Stock Option, shall not be transferable by the optionee otherwise than by will, or
by the laws of descent and distribution, and all Stock Options shall be exercisable, during the optionee’s lifetime, only by the
optionee, or by the optionee’s legal representative or guardian in the event of the optionee’s incapacity. Notwithstanding
the foregoing, the Committee, in its sole discretion, may provide in the Award Agreement regarding a given Stock Option or Restricted
Stock award that the optionee may transfer by gift, without consideration for the transfer, his or her Non-Qualified Stock Options to
his or her family members (as defined in Rule 701 of the Securities Act), to trusts for the benefit of such family members, or to
partnerships in which such family members are the only partners (to the extent such trusts or partnerships are considered “family
members” for purposes of Rule 701 of the Securities Act), provided that the transferee agrees in writing with the Company
to be bound by all of the terms and conditions of this Plan and the applicable Award Agreement, including the execution of a stock power
upon the issuance of Shares. Stock Options, SARs and the Shares issuable upon exercise of such Stock Options, shall be restricted as
to any pledge, hypothecation, or other transfer, including any short position, any “put equivalent position” (as defined
in the Exchange Act) or any “call equivalent position” (as defined in the Exchange Act) prior to exercise.
(ii)
Shares. No Shares shall be sold, assigned, transferred, pledged, hypothecated, given away or in any other manner disposed of or
encumbered, whether voluntarily or by operation of law, unless (i) the transfer is in compliance with the terms of the applicable Award
Agreement, all applicable securities laws (including, without limitation, the Securities Act), and with the terms and conditions of this
Section 10, (ii) the transfer does not cause the Company to become subject to the reporting requirements of the Exchange Act, and
the transferee consents in writing to be bound by the provisions of the Plan and the Award Agreement, including this Section 10.
In connection with any proposed transfer, the Committee may require the transferor to provide at the transferor’s own expense an
opinion of counsel to the transferor, satisfactory to the Committee, that such transfer is in compliance with all foreign, federal and
state securities laws (including, without limitation, the Securities Act). Any attempted transfer of Shares not in accordance with the
terms and conditions of this Section 10 shall be null and void, and the Company shall not reflect on its records any change in record
ownership of any Shares as a result of any such transfer, shall otherwise refuse to recognize any such transfer and shall not in any
way give effect to any such transfer of Shares. The Company shall be entitled to seek protective orders, injunctive relief and other
remedies available at law or in equity including, without limitation, seeking specific performance or the rescission of any transfer
not made in strict compliance with the provisions of this Section 10. Subject to the foregoing general provisions, and unless otherwise
provided in the applicable Award Agreement, Shares may be transferred pursuant to the following specific terms and conditions (provided
that with respect to any transfer of Restricted Stock, all vesting and forfeiture provisions shall continue to apply with respect to
the original recipient):
(A)
Transfers to Permitted Transferees. The Holder may transfer any or all of the Shares to one or more Permitted Transferees; provided,
however, that following such transfer, such Shares shall continue to be subject to the terms of this Plan (including this Section 10)
and such Permitted Transferee(s) shall, as a condition to any such transfer, deliver a written acknowledgment to that effect to the Company
and shall deliver a stock power to the Company with respect to the Shares. Notwithstanding the foregoing, the Holder may not transfer
any of the Shares to a Person whom the Company reasonably determines is a direct competitor or a potential competitor of the Company
or any of its Subsidiaries.
(B)
Transfers Upon Death. Upon the death of the Holder, any Shares then held by the Holder at the time of such death and any Shares
acquired after the Holder’s death by the Holder’s legal representative shall be subject to the provisions of this Plan, and
the Holder’s estate, executors, administrators, personal representatives, heirs, legatees and distributees shall be obligated to
convey such Shares to the Company or its assigns under the terms contemplated by the Plan and the Award Agreement.
(b)
Right of First Refusal. In the event that a Holder desires at any time to sell or otherwise transfer all or any part of his or
her Shares (other than shares of Restricted Stock which by their terms are not transferrable), the Holder first shall give written notice
to the Company of the Holder’s intention to make such transfer. Such notice shall state the number of Shares that the Holder proposes
to sell (the “Offered Shares”), the price and the terms at which the proposed sale is to be made and the name and address
of the proposed transferee. At any time within 30 days after the receipt of such notice by the Company, the Company or its assigns may
elect to purchase all or any portion of the Offered Shares at the price and on the terms offered by the proposed transferee and specified
in the notice. The Company or its assigns shall exercise this right by mailing or delivering written notice to the Holder within the
foregoing 30-day period. If the Company or its assigns elect to exercise its purchase rights under this Section 10(b), the closing
for such purchase shall, in any event, take place within 45 days after the receipt by the Company of the initial notice from the Holder.
In the event that the Company or its assigns do not elect to exercise such purchase right, or in the event that the Company or its assigns
do not pay the full purchase price within such 45-day period, the Holder shall be required to pay a transaction processing fee of $10,000
to the Company (unless waived by the Committee) and then may, within 60 days thereafter, sell the Offered Shares to the proposed transferee
and at the same price and on the same terms as specified in the Holder’s notice. Any Shares not sold to the proposed transferee
shall remain subject to the Plan. If the Holder is a party to any stockholders agreements or other agreements with the Company and/or
certain other of the Company’s stockholders relating to the Shares, (i) the transferring Holder shall comply with the requirements
of such stockholders agreements or other agreements relating to any proposed transfer of the Offered Shares, and (ii) any proposed transferee
that purchases Offered Shares shall enter into such stockholders agreements or other agreements with the Company and/or certain of the
Company’s stockholders relating to the Offered Shares on the same terms and in the same capacity as the transferring Holder.
(c)
Company’s Right of Repurchase.
(i)
Right of Repurchase for Unvested Shares Issued Upon the Exercise of an Option. Upon a Termination Event, the Company or its assigns
shall have the right and option to repurchase from a Holder of Shares acquired upon exercise of a Stock Option which is still subject
to a risk of forfeiture as of the Termination Event. Such repurchase rights may be exercised by the Company within the later of (A) six
months following the date of such Termination Event or (B) seven months after the acquisition of Shares upon exercise of a Stock Option.
The repurchase price shall be equal to the lower of the original per share price paid by the Holder, subject to adjustment as provided
in Section 3(b) of the Plan, or the current Fair Market Value of such Shares as of the date the Company elects to exercise its repurchase
rights.
(ii)
Right of Repurchase With Respect to Restricted Stock. Upon a Termination Event, the Company or its assigns shall have the right
and option to repurchase from a Holder of Shares received pursuant to a Restricted Stock Award any Shares that are still subject to a
risk of forfeiture as of the Termination Event. Such repurchase right may be exercised by the Company within six months following the
date of such Termination Event. The repurchase price shall be the lower of the original per share purchase price paid by the Holder,
subject to adjustment as provided in Section 3(b) of the Plan, or the current Fair Market Value of such Shares as of the date the
Company elects to exercise its repurchase rights.
(iii)
Procedure. Any repurchase right of the Company shall be exercised by the Company or its assigns by giving the Holder written notice
on or before the last day of the repurchase period of its intention to exercise such repurchase right. Upon such notification, the Holder
shall promptly surrender to the Company, free and clear of any liens or encumbrances, any certificates representing the Shares being
purchased, together with a duly executed stock power for the transfer of such Shares to the Company or the Company’s assignee or
assignees. Upon the Company’s or its assignee’s receipt of the certificates from the Holder, the Company or its assignee
or assignees shall deliver to him, her or them a check for the applicable repurchase price; provided, however, that the Company may pay
the repurchase price by offsetting and canceling any indebtedness then owed by the Holder to the Company.
(d)
Escrow Arrangement.
(i)
Escrow. In order to carry out the provisions of this Section 10 of this Plan more effectively, the Company shall hold any
Shares issued pursuant to Awards granted under the Plan in escrow together with separate stock powers executed by the Holder in blank
for transfer. The Company shall not dispose of the Shares except as otherwise provided in this Plan. In the event of any repurchase by
the Company (or any of its assigns), the Company is hereby authorized by the Holder, as the Holder’s attorney-in-fact, to date
and complete the stock powers necessary for the transfer of the Shares being purchased and to transfer such Shares in accordance with
the terms hereof. At such time as any Shares are no longer subject to the Company’s repurchase and first refusal rights, the Company
shall, at the written request of the Holder, deliver to the Holder a certificate representing such Shares with the balance of the Shares
to be held in escrow pursuant to this Section.
(ii)
Remedy. Without limitation of any other provision of this Plan or other rights, in the event that a Holder or any other Person
is required to sell a Holder’s Shares pursuant to the provisions of Sections 10(b) or (c) hereof and in the further event
that he or she refuses or for any reason fails to deliver to the Company or its designated purchaser of such Shares the certificate or
certificates evidencing such Shares together with a related stock power, the Company or such designated purchaser may deposit the applicable
purchase price for such Shares with a bank designated by the Company, or with the Company’s independent public accounting firm,
as agent or trustee, or in escrow, for such Holder or other Person, to be held by such bank or accounting firm for the benefit of and
for delivery to him, her, them or it, and/or, in its discretion, pay such purchase price by offsetting any indebtedness then owed by
such Holder as provided above. Upon any such deposit and/or offset by the Company or its designated purchaser of such amount and upon
notice to the Person who was required to sell the Shares to be sold pursuant to the provisions of Sections 10(b) or (c), such Shares
shall at such time be deemed to have been sold, assigned, transferred and conveyed to such purchaser, such Holder shall have no further
rights thereto (other than the right to withdraw the payment thereof held in escrow, if applicable), and the Company shall record such
transfer in its stock transfer book or in any appropriate manner.
(e)
Lockup Provision. If requested by the Company, a Holder shall not sell or otherwise transfer or dispose of any Shares (including,
without limitation, pursuant to Rule 144 under the Securities Act) held by him or her for such period following the effective date
of a public offering by the Company of Shares as the Company shall specify reasonably and in good faith. If requested by the underwriter
engaged by the Company, each Holder shall execute a separate letter confirming his or her agreement to comply with this Section.
(f)
Adjustments for Changes in Capital Structure. If, as a result of any reorganization, recapitalization, reclassification, stock
dividend, stock split, reverse stock split or other similar change in the Common Stock, the outstanding Shares are increased or decreased
or are exchanged for a different number or kind of securities of the Company, the restrictions contained in this Section 10 shall
apply with equal force to additional and/or substitute securities, if any, received by Holder in exchange for, or by virtue of his or
her ownership of, Shares.
(g)
Termination. The terms and provisions of Section 10(b) and Section 10(c) (except for the Company’s right to repurchase
Shares still subject to a risk of forfeiture upon a Termination Event) shall terminate upon consummation of any Sale Event, in either
case as a result of which Shares are registered under Section 12 of the Exchange Act and publicly-traded on any national security
exchange.
SECTION 11.
TAX WITHHOLDING
(a)
Payment by Grantee. Each grantee shall, no later than the date as of which the value of an Award or of any Shares or other amounts
received thereunder first becomes includable in the gross income of the grantee for income tax purposes, pay to the Company, or make
arrangements satisfactory to the Committee regarding payment of, any Federal, state, or local taxes of any kind required by law to be
withheld by the Company with respect to such income. The Company and any Subsidiary shall, to the extent permitted by law, have the right
to deduct any such taxes from any payment of any kind otherwise due to the grantee. The Company’s obligation to deliver stock certificates
(or evidence of book entry) to any grantee is subject to and conditioned on any such tax withholding obligations being satisfied by the
grantee.
(b)
Payment in Stock. The Company’s minimum required tax withholding obligation may be satisfied, in whole or in part, by the
Company withholding from Shares to be issued pursuant to an Award a number of Shares having an aggregate Fair Market Value (as of the
date the withholding is effected) that would satisfy the minimum withholding amount due.
SECTION 12.
SECTION 409A AWARDS
To
the extent that any Award is determined to constitute “nonqualified deferred compensation” within the meaning of Section 409A
(a “409A Award”), the Award shall be subject to such additional rules and requirements as may be specified by the Committee
from time to time. In this regard, if any amount under a 409A Award is payable upon a “separation from service” (within the
meaning of Section 409A) to a grantee who is considered a “specified employee” (within the meaning of Section 409A),
then no such payment shall be made prior to the date that is the earlier of (i) six months and one day after the grantee’s separation
from service, or (ii) the grantee’s death, but only to the extent such delay is necessary to prevent such payment from being subject
to interest, penalties and/or additional tax imposed pursuant to Section 409A. The Company makes no representation or warranty and
shall have no liability to any grantee under the Plan or any other Person with respect to any penalties or taxes under Section 409A
that are, or may be, imposed with respect to any Award. It is the intent of the Board that payments and benefits under the Plan comply
with or be exempt from Section 409A and the regulations and guidance promulgated thereunder and, accordingly, to the maximum extent
permitted the Plan shall be interpreted to be in compliance therewith or exempt therefrom. In no event whatsoever shall the Company be
liable for any additional tax, interest or penalty that may be imposed upon a Participant by Section 409A or damages to a Participant
for failing to comply with Section 409A.
SECTION 13.
AMENDMENTS AND TERMINATION
The
Board may, at any time, amend or discontinue the Plan and the Committee may, at any time, amend or cancel any outstanding Award for the
purpose of satisfying changes in law or for any other lawful purpose, but no such action shall adversely affect rights under any outstanding
Award without the consent of the holder of the Award. The Committee may exercise its discretion to reduce the exercise price of outstanding
Stock Options or effect repricing through cancellation of outstanding Stock Options and by granting such holders new Awards in replacement
of the cancelled Stock Options. To the extent determined by the Committee to be required either by the Code to ensure that Incentive
Stock Options granted under the Plan are qualified under Section 422 of the Code or otherwise, Plan amendments shall be subject
to approval by the Company stockholders entitled to vote at a meeting of stockholders. Nothing in this Section 13 shall limit the
Board’s or Committee’s authority to take any action permitted pursuant to Section 3(c). The Board reserves the right
to amend the Plan and/or the terms of any outstanding Stock Options to the extent reasonably necessary to comply with the requirements
of the exemption pursuant to Rule 12h-1 of the Exchange Act.
SECTION 14.
STATUS OF PLAN
With
respect to the portion of any Award that has not been exercised and any payments in cash, Stock or other consideration not received by
a grantee, a grantee shall have no rights greater than those of a general creditor of the Company unless the Committee shall otherwise
expressly so determine in connection with any Award.
SECTION 15.
GENERAL PROVISIONS
(a)
No Distribution; Compliance with Legal Requirements. The Committee may require each person acquiring Shares pursuant to an Award
to represent to and agree with the Company in writing that such person is acquiring the Shares without a view to distribution thereof.
No Shares shall be issued pursuant to an Award until all applicable securities law and other legal and stock exchange or similar requirements
have been satisfied. The Committee may require the placing of such stop-orders and restrictive legends on certificates for Stock and
Awards, as it deems appropriate.
(b)
Delivery of Stock Certificates. Stock certificates to grantees under the Plan shall be deemed delivered for all purposes when
the Company or a stock transfer agent of the Company shall have mailed such certificates in the United States mail, addressed to the
grantee, at the grantee’s last known address on file with the Company; provided that stock certificates to be held in escrow pursuant
to Section 10 of the Plan shall be deemed delivered when the Company shall have recorded the issuance in its records. Uncertificated
Stock shall be deemed delivered for all purposes when the Company or a stock transfer agent of the Company shall have given to the grantee
by electronic mail (with proof of receipt) or by United States mail, addressed to the grantee, at the grantee’s last known address
on file with the Company, notice of issuance and recorded the issuance in its records (which may include electronic “book entry”
records).
(c)
No Employment Rights. The adoption of the Plan and the grant of Awards do not confer upon any Person any right to continued employment
or Service Relationship with the Company or any Subsidiary.
(d)
Trading Policy Restrictions. Option exercises and other Awards under the Plan shall be subject to the Company’s insider
trading policy-related restrictions, terms and conditions as may be established by the Committee, or in accordance with policies set
by the Committee, from time to time.
(e)
Designation of Beneficiary. Each grantee to whom an Award has been made under the Plan may designate a beneficiary or beneficiaries
to exercise any Award on or after the grantee’s death or receive any payment under any Award payable on or after the grantee’s
death. Any such designation shall be on a form provided for that purpose by the Committee and shall not be effective until received by
the Committee. If no beneficiary has been designated by a deceased grantee, or if the designated beneficiaries have predeceased the grantee,
the beneficiary shall be the grantee’s estate.
(f)
Legend. Any certificate(s) representing the Shares shall carry substantially the following legend (and with respect to uncertificated
Stock, the book entries evidencing such shares shall contain the following notation):
The
transferability of this certificate and the shares of stock represented hereby are subject to the restrictions, terms and conditions
(including repurchase and restrictions against transfers contained in the Plan and any agreements entered into thereunder by and between
the company and the holder of this certificate (a copy of which is available at the offices of the company for examination).
(g)
Information to Holders of Options. In the event the Company is relying on the exemption from the registration requirements of
Section 12(g) of the Exchange Act contained in paragraph (f)(1) of Rule 12h-1 of the Exchange Act, the Company shall provide
the information described in Rule 701(e)(3), (4) and (5) of the Securities Act to all holders of Options in accordance with the
requirements thereunder. The foregoing notwithstanding, the Company shall not be required to provide such information unless the option
holder has agreed in writing, on a form prescribed by the Company, to keep such information confidential.
SECTION 16.
EFFECTIVE DATE OF PLAN
The
Plan shall become effective upon adoption by the Board and shall be approved by stockholders in accordance with applicable state law
and the Company’s articles of incorporation and bylaws within 12 months thereafter. If the stockholders fail to approve the Plan
within 12 months after its adoption by the Board of Directors, then any Awards granted or sold under the Plan shall be rescinded and
no additional grants or sales shall thereafter be made under the Plan. Subject to such approval by stockholders and to the requirement
that no Shares may be issued hereunder prior to such approval, Stock Options and other Awards may be granted hereunder on and after adoption
of the Plan by the Board. No grants of Stock Options and other Awards may be made hereunder after the tenth anniversary of the date the
Plan is adopted by the Board or the date the Plan is approved by the Company’s stockholders, whichever is earlier.
SECTION 17.
GOVERNING LAW
This
Plan, all Awards and any controversy arising out of or relating to this Plan and all Awards shall be governed by and construed in accordance
with the laws of the State of Nevada as to matters within the scope thereof, without regard to conflict of law principles that would
result in the application of any law other than the law of the State of Delaware.
| DATE
ADOPTED BY THE BOARD OF DIRECTORS: |
May
31, 2023 |
DATE
ADOPTED BY THE
SHAREHOLDERS:
__________________________.
VIVAKOR, INC. 4101 NORTH THANKSGIVING WAY LEHI,
UTAH 84043 Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary,
please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please
sign in full corporate or partnership name by authorized officer. ! ! ! ! ! ! VOTE BY INTERNET - www.proxyvote.com or scan the QR Barcode
above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m. Eastern Time
on May 30, 2023. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to
create an electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs incurred
by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically
via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and,
when prompted, indicate that you agree to receive or access proxy materials electronically in future years. VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m. Eastern Time on May 30, 2023. Have your proxy card
in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid
envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. SCAN TO VIEW MATERIALS
& VOTE TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDS THIS PROXY CARD IS VALID ONLY
WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY V14152-Z85118 1. Acquisition Stock Issuance Proposal. To approve the issuance
of a number of shares of the Company’s common stock pursuant to Membership Interest Purchase Agreement (the “Acquisition
Agreement”) entered into on June 15, 2022, by and among the Company and Jorgan Development, LLC, a Louisiana limited liability
company and JBAH Holdings, LLC, a Texas limited liability company including the issuance of such shares upon the conversion of promissory
notes issued pursuant to the Acquisition Agreement, as amended on October 28, 2022, which could, under certain circumstances that may
occur in the future, exceeding 19.99% of the number of shares of the Company’s common stock outstanding as of the date of the Acquisition
Agreements. 2. CEO Compensation Shares Issuance Proposal. To approve the annual compensation of $1,000,000 payable in shares of the Company’s
common stock James Ballengee pursuant to an executive employment agreement, dated October 28, 2022, with respect to the Company’s
appointment of Mr. Ballengee as Chief Executive Officer and Chairman of the board of directors of the Company. 3. Equity Incentive Plan
Proposal. To approve the Vivakor, Inc. 2023 Equity and Incentive Plan. 4. Charter Amendment Proposal. To approve and adopt an amendment
to the Second Amended and Restated Articles of Incorporation of the Company with respect to the forum selection provisions. 6. Adjournment
Proposal. To approve one or more adjournments of the Special Meeting to a later date or dates, if necessary or appropriate, to solicit
additional proxies if there are insufficient votes for the approval of the Acquisition Stock Issuance Proposal, CEO Compensation Shares
Issuance Proposal, Equity Incentive Plan Proposal, and Charter Amendment Proposals at the time of the Special Meeting. 5. Charter Amendment
Proposal. To approve and adopt an amendment to the Second Amended and Restated Articles of Incorporation of the Company with respect
to increase the authorized number of shares of the Company’s common stock to 150 million shares. For Against Abstain ! ! ! ! !
! ! ! ! ! ! ! VIVAKOR, INC. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1, 2, 3, 4, 5, and 6. VIVAKOR, INC. 4101 NORTH THANKSGIVING
WAY LEHI, UTAH 84043 Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other
fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership,
please sign in full corporate or partnership name by authorized officer Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners)
Date
Important Notice Regarding the Availability of Proxy Materials for the Special Meeting:
The Proxy Statement is available at www.proxyvote.com. V14153-Z85118 VIVAKOR, INC. PROXY FOR SPECIAL MEETING TO BE HELD ON MAY 31, 2023
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned hereby appoints James Ballengee, our Chief Executive Officer,
as proxy, with full power of substitution, to represent and to vote all the shares of common stock of VIVAKOR, INC. (the “Company”),
which the undersigned would be entitled to vote, at the Company’s Special Meeting of the Stockholders of the Company to be held
on May 31, 2023, at 2 p.m. Eastern Time and at any adjournments thereof, subject to the directions indicated on this Proxy Card. In their
discretion, the proxy is authorized to vote upon any other matter that may properly come before the meeting or any adjournments thereof.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATIONS MADE, BUT IF NO CHOICES ARE INDICATED, THIS PROXY WILL BE VOTED FOR THE
PROPOSALS LISTED ON THE REVERSE SIDE. Continued and to be signed on reverse side