Prior to Granting Stock Options

Adopt a stock option plan First, adopt a plan and draft

standard stock option agreements under the plan. If
shareholders do not approve the plan, you cannot grant
incentive stock options, and you may be required to
make special filings with state securities regulators.

Confirm that you have sufficient shares- Prior to

granting stock options; confirm you have the number of shares
under the plan to grant the new batch of options.

Rule 701- Before every grant of stock options, confirm

that you are compliant with Rule 701s mathematical
limitations. Rule 701 has mathematical limitations, meaning
there is a limit to the number of securities you can issue under
Rule 701, and you do not want to exceed that limit. For a
summary of the limits, see What Is Rule 701 and Do I Need to
Worry About It? [Be aware that Rule 701 is only available to
companies that are not subject to the reporting requirements
of section 13 or 15(d) of the Securities Exchange Act]

Prospectus- If you have granted more than $5M in

options during the last 12 months, make sure to provide the
prospectus required by Rule 701.

Eligible recipients- Confirm each prospective option

recipient is eligible under the plan. Generally, only individuals
qualify. Non-employee/consultants can qualify as long as they
are natural persons providing bona fide services and not

receiving the options in connection with a capital raising

transaction.

Confirm the residency of recipients Before every

grant of stock options, confirm the residency of the prospective
optionees and confirm that you are compliant with the Blue Sky
law of each state in which investors are resident. If you are
granting options to optionees in California, special attention will
need to be given to Californias requirements.

Fair market value- Make sure that the options are being
granted at fair market value in compliance with Section 409A of
the Internal Revenue Code.

Board approval- Have the Board approve the option

grants pursuant to a Board Consent or resolutions adopted at a
meeting. If the vesting schedules for any of the options are
different from the standard specified in the standard
agreements, make sure the Board consent describes the
vesting schedule.

Signed agreements- After each grant of stock options,

give each recipient a copy of the stock option plan and their
stock option agreements, and have them sign the agreements
required under the plan.

Capitalization ledger- Update the capitalization ledger

once the option is approved.
Board Approval for 409a Valuation:

RESOLVED: That the Board has reviewed the written valuation report prepared by __________ (the
"Valuation Report") and has determined that $____ per share is the current per share fair market
value of the Company's Common Stock as of the effective date of these resolutions, which

determination has been made in good faith, based on all of the relevant facts and circumstances as of
the effective date of these resolutions, including, to the extent applicable, some or all of the following
factors: the value of the Company's tangible and intangible assets, the present value of anticipated
future cash flows of the Company, the market value of the stock or other equity interests of similar
companies and other entities engaged in trades or businesses substantially similar to those engaged in
by the Company whose value can be readily determined through non-discretionary objective means,
recent arm's length transactions involving the sale or transfer of Company stock and other relevant
factors such as control premiums or discounts for lack of marketability.
Board Approval for Creation of Stock Plan:

Adoption of the 2016 Stock Plan

RESOLVED: That the 2016 Stock Plan (the Plan), in substantially the form made available
herewith to the Board of Directors, is hereby adopted and __________ shares of the Companys
Common Stock are hereby reserved for issuance under the Plan.
RESOLVED FURTHER: That the Plan shall continue for 10 years from the effective date of these
resolutions unless terminated earlier pursuant to its terms.
RESOLVED FURTHER: That the forms of Notice of Stock Option Grant and Stock Option
Agreement, the form of Notice of Restricted Stock Award and Restricted Stock Purchase Agreement
and the form of Notice of Restricted Stock Award and Restricted Stock Agreement, in substantially
the form made available herewith to the Board of Directors are hereby approved to document awards
granted under the Plan, with such modifications or amendments to each form, or any individual
agreement, as may be approved by the officers of the Company, or any of them individually,
provided that any such changes do not individually, or in the aggregate, have a material financial,
legal, tax or accounting impact on the Company or any of its affiliates.
RESOLVED FURTHER: That it is desirable and in the best interest of the Company that its
securities be qualified or registered for sale in various states; that the President or any Vice President
and the Secretary or any Assistant Secretary hereby are authorized to determine the states in which
appropriate action shall be taken to qualify or register for sale all or such part of the securities of the
Company as said officers may deem advisable; that said officers are hereby authorized to perform on
behalf of the Company any and all such acts as they deem necessary or advisable in order to comply
with the applicable laws of any such states, and in connection therewith to execute and file all
requisite papers and documents, including, but not limited to, applications, reports, surety bonds,
irrevocable consents and appointments of attorneys for service of process; and the execution by such
officers of any such paper or document or the doing by them of any act in connection with the
foregoing matters shall conclusively establish their authority from the Company and the approval and
ratification by the Company of the papers and documents so executed and the action so taken.
RESOLVED FURTHER: That the officers and their designees or agents are hereby authorized to
perform on behalf of the Company any and all such acts as they deem necessary or advisable in order
to comply with any applicable state laws, and in connection therewith to execute and file all requisite
papers and documents, including, but not limited to, applications, reports, surety bonds, irrevocable
consents and appointments of attorneys for service of process.
RESOLVED FURTHER: That the officers of the Company, in consultation with legal counsel, are
authorized and directed to take any and all additional actions and file any other documents necessary
to carry out the intent and purposes of the foregoing resolutions, including qualifying or exempting
the issuance of securities under the Plan from the registration requirements of applicable state law.

RESOLVED FURTHER: That the officers of the Company are hereby authorized and directed to
seek stockholder approval of the Plan.
2. Omnibus Resolution
RESOLVED: That each of the officers is authorized and empowered to take all such actions
(including, without limitation, soliciting appropriate consents or waivers from stockholders) and to
execute and deliver all such documents as may be necessary or advisable to carry out the intent and
accomplish the purposes of the foregoing resolutions and to effect any transactions contemplated
thereby and the performance of any such actions and the execution and delivery of any such
documents shall be conclusive evidence of the approval of the Board thereof and all matters relating
thereto.
This action may be executed in writing, or consented to by electronic
transmission, in any number of counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same action.