Alopexx, Inc. S-1/A



Exhibit
10.1


 


 


 


 


ALOPEXX,
INC.


 


2022
EQUITY INCENTIVE PLAN


 


 


 




     


     


    

 


TABLE
OF CONTENTS


 


Page


 




	1.      Purpose;
    Eligibility	1
	1.1     General
    Purpose	1
	1.2     Eligible
    Award Recipients	1
	1.3     Available
    Awards	1
	2.      Definitions	1
	3.      Administration	8
	3.1     Authority
    of Committee	8
	3.2     Committee
    Decisions Final	10
	3.3     Delegation	10
	3.4     Committee
    Composition	10
	3.5     Indemnification	10
	4.      Shares
    Subject to the Plan	11
	4.1	11
	4.2	11
	4.3	11
	4.4	11
	4.5	11
	4.6	11
	5.      Eligibility	12
	5.1     Eligibility
    for Specific Awards	12
	5.2     Ten
    Percent Shareholders	12
	6.      Option
    Provisions	12
	6.1     Term	12
	6.2     Exercise
    Price of an Incentive Stock Option	13
	6.3     Exercise
    Price of a Non-qualified Stock Option	13
	6.4     Consideration	13
	6.5     Transferability
    of an Incentive Stock Option	13
	6.6     Transferability
    of a Non-qualified Stock Option	14



 






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	6.7     Vesting
    of Options	14
	6.8     Termination
    of Continuous Service	14
	6.9     Extension
    of Termination Date	14
	6.10   Disability
    of Optionholder	14
	6.11   Death
    of Optionholder	15
	6.12   Incentive
    Stock Option $100,000 Limitation	15
	7.      Stock
    Appreciation Rights	15
	7.1     Grant
    Requirements for Related Rights	15
	7.2     Term	15
	7.3     Vesting	15
	7.4     Exercise
    and Payment	16
	7.5     Exercise
    Price	16
	7.6     Reduction
    in the Underlying Option Shares	16
	8.      Restricted
    Awards	16
	8.1     Restricted
    Stock and Restricted Stock Units	17
	8.2     Restrictions	17
	8.3     Restricted
    Period	18
	8.4     Delivery
    of Restricted Stock and Settlement of Restricted Stock Units	18
	8.5     Stock
    Restrictions 	19
	9.      Performance
    Share Awards	19
	9.1     Earning
    Performance Share Awards	19
	10.      Other
    Equity-Based Awards and Cash Awards	19
	11.      Securities
    Law Compliance	19
	12.      Use
    of Proceeds from Stock	20
	13.      Miscellaneous	20
	13.1   Acceleration
    of Exercisability and Vesting	20
	13.2   Shareholder
    Rights	20
	13.3   No
    Employment or Other Service Rights	20
	13.4   Transfer;
    Approved Leave of Absence	20
	13.5   Withholding
    Obligations	20
	14.      Adjustments
    Upon Changes in Stock	21
	15.      Effect
    of Change in Control	23
	15.1	24



 






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	15.2   .	24
	15.3	24
	16.      Amendment
    of the Plan and Awards	24
	16.1   Amendment
    of Plan	24
	16.2   Shareholder
    Approval	24
	16.3   Contemplated
    Amendments	24
	16.4   No
    Impairment of Rights	24
	16.5   Amendment
    of Awards	24
	17.      General
    Provisions	25
	17.1   Forfeiture
    Events	25
	17.2   Clawback	25
	17.3   Other
    Compensation Arrangements	25
	17.4   Sub-Plans	25
	17.5   Deferral
    of Awards	25
	17.6   Unfunded
    Plan	26
	17.7   Recapitalizations	26
	17.8   Delivery	26
	17.9   No
    Fractional Shares	26
	17.10   Other
    Provisions	26
	17.11   Section
    409A	26
	17.12   Disqualifying
    Dispositions	26
	17.13   Section
    16	26
	17.14   Beneficiary
    Designation	27
	17.15   Expenses	27
	17.16   Severability	27
	17.17   Plan
    Headings	27
	17.18   Non-Uniform
    Treatment	27
	18.      Effective
    Date of Plan	27
	19.      Termination
    or Suspension of the Plan	27
	20.      Choice
    of Law	27



 



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1.         Purpose; Eligibility.


 


1.1           General Purpose. The name of this plan
is the Alopexx, Inc. 2022 Equity Incentive Plan (the "Plan"). The purposes of the Plan are to (a) enable Alopexx,
Inc., a Delaware corporation (the "Company"), and any Affiliate to attract and retain the types of Employees,
Consultants and Directors who will contribute to the Company's long termsuccess; (b) provide incentives that align the interests
of Employees, Consultants and Directors with those of the shareholders of the Company; and (c) promote the success of the Company's
business.


 


1.2           Eligible Award Recipients. The persons
eligible to receive Awards are the Employees, Consultants and Directors of the Company and such other individuals designated by
the Committee who are reasonably expected to become Employees, Consultants and Directors after the receipt of Awards.


 


1.3           Available Awards. Awards that may be granted
under the Plan include: (a) Incentive Stock Options, (b) Non-qualified Stock Options, (c) Stock Appreciation Rights, (d) Restricted
Awards (including restricted stock units), (e) Performance Share Awards, (f) Cash Awards, and (g) Other Equity-Based Awards.


 


2.         Definitions.


 


"Affiliate"
means a corporation or other entity that, directly or through one or more intermediaries, controls, is controlled by or is under
common control with, the Company.


 


"Applicable
Laws" means the requirements related to or implicated by the administration of the Plan under applicable state corporate
law, United States federal and state securities laws, the Code, any stock exchange or quotation system on which the shares of
Common Stock are listed or quoted, and the applicable laws of any foreign country or jurisdiction where Awards are granted under
the Plan.


 


"Award"
means any right granted under the Plan, including an Incentive Stock Option, a Non-qualified Stock Option, a Stock Appreciation
Right, a Restricted Award, a Performance Share Award, a Cash Award, or an Other Equity-Based Award.


 


"Award
Agreement" means a written agreement, contract, certificate or other instrument or document evidencing the terms and
conditions of an individual Award granted under the Plan which may, in the discretion of the Company, be transmitted electronically
to any Participant. Each Award Agreement shall be subject to the terms and conditions of the Plan.


 


"Beneficial
Owner" has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating
the beneficial ownership of any particular Person, such Person shall be deemed to have beneficial ownership of all securities
that such Person has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable
or is exercisable only after the passage of time. The terms "Beneficially Owns" and "Beneficially Owned" have
a corresponding meaning.


 






     


     


    

 


"Board"
means the Board of Directors of the Company, as constituted at any time.


 


"Cause"
means:


 


	 	With
                                         respect to any Employee or Consultant, unless the applicable Award Agreement states otherwise:

         

        (a)
        If the Employee or Consultant is a party to an employment or service agreement with the Company or its Affiliates and
        such agreement provides for a definition of Cause, the definition contained therein; or

         

        (b)
        If no such agreement exists, or if such agreement does not define Cause: (i) the commission of, or plea of guilty or no
        contest to, a felony or a crime involving moral turpitude or the commission of any other act involving willful malfeasance
        or material fiduciary breach with respect to the Company or an Affiliate; (ii) conduct that brings or is reasonably likely
        to bring the Company or an Affiliate negative publicity or into public disgrace, embarrassment, or disrepute; (iii) gross
        negligence or willful misconduct with respect to the Company or an Affiliate; (iv) material violation of state or federal
        securities laws; or (v) material violation of the Company's written policies or codes of conduct, including written policies
        related to discrimination, harassment, performance of illegal or unethical activities, and ethical misconduct.

         

	 	With
                                         respect to any Director, unless the applicable Award Agreement states otherwise, a determination
                                         by a majority of the disinterested Board members that the Director has engaged in any
                                         of the following:

         

        (a)
        malfeasance in office;

         

        (b)
        gross misconduct or neglect;

         

        (c)
        false or fraudulent misrepresentation inducing the director's appointment;

         

        (d)
        willful conversion of corporate funds; or

         

        (e)
repeated failure to participate in Board meetings on a regular basis despite having received proper notice of the meetings in
advance. 



 


The
Committee, in its absolute discretion, shall determine the effect of all matters and questions relating to whether a Participant
has been discharged for Cause.


 






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"Change
in Control" means:


 


	 	(a)
                                         The direct or indirect sale, transfer, conveyance or other disposition (other than by
                                         way of merger or consolidation), in one or a series of related transactions, of all or
                                         substantially all of the properties or assets of the Company and its subsidiaries, taken
                                         as a whole, to any Person that is not a subsidiary of the Company;

         

        (b)
        The Incumbent Directors cease for any reason to constitute at least a majority of the Board;

         

        (c)
        The date which is 10 business days prior to the consummation of a complete liquidation or dissolution of the Company;

         

        (d)
        The acquisition by any Person of Beneficial Ownership of [50]% or more (on a fully diluted basis) of either (i) the then-outstanding
        shares of Common Stock of the Company, taking into account as outstanding for this purpose such Common Stock issuable
        upon the exercise of options or warrants, the conversion of convertible stock or debt, and the exercise of any similar
        right to acquire such Common Stock (the "Outstanding Company Common Stock") or (ii) the combined voting
        power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors
        (the "Outstanding Company Voting Securities"); provided, however, that for purposes of this Plan,
        the following acquisitions shall not constitute a Change in Control: (A) any acquisition by the Company or any Affiliate,
        (B) any acquisition by any employee benefit plan sponsored or maintained by the Company or any subsidiary, (C) any acquisition
        which complies with clauses, (i), (ii) and (iii) of subsection (e) of this definition or (D) in respect of an Award held
        by a particular Participant, any acquisition by the Participant or any group of persons including the Participant (or
        any entity controlled by the Participant or any group of persons including the Participant); or

         

        (e)
The consummation of a reorganization, merger, consolidation, statutory share exchange or similar form of corporate transaction
involving the Company that requires the approval of the Company's shareholders, whether for such transaction or the issuance of
securities in the transaction (a "Business Combination"), unless immediately following such Business Combination:
(i) more than 50% of the total voting power of (A) the entity resulting from such Business Combination (the "Surviving
Company"), or (B) if applicable, the ultimate parent entity that directly or indirectly has beneficial ownership of sufficient
voting securities eligible to elect a majority of the members of the board of directors (or the analogous governing body) of the
Surviving Company (the "Parent Company"), is represented by the Outstanding Company Voting Securities that were
outstanding immediately prior to such Business Combination (or, if applicable, is represented by shares into which the Outstanding
Company Voting Securities were converted pursuant to such Business Combination), and such voting power among the holders thereof
is in substantially the same proportion as the voting power of the Outstanding Company Voting Securities among the holders thereof
immediately prior to the Business Combination; (ii) no Person (other than any employee benefit plan sponsored or maintained by
the Surviving Company or the Parent Company) is or becomes the Beneficial Owner, directly or indirectly, of 50% or more of the
total voting power of the outstanding voting securities eligible to elect members of the board of directors of the Parent Company
(or the analogous governing body) (or, if there is no Parent Company, the Surviving Company); and (iii) at least a majority of
the members of the board of directors (or the analogous governing body) of the Parent Company (or, if there is no Parent Company,
the Surviving Company) following the consummation of the Business Combination were Board members at the time of the Board's approval
of the execution of the initial agreement providing for such Business Combination. 



 






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"Code"
means the Internal Revenue Code of 1986, as it may be amended from time to time. Any reference to a section of the Code shall
be deemed to include a reference to any regulations promulgated thereunder.


 


"Committee"
means a committee of one or more members of the Board appointed by the Board to administer the Plan in accordance with Section
3.3 and Section 3.4.


 


"Common
Stock" means the common stock, $0.0001 par value per share, of the Company, or such other securities of the Company as
may be designated by the Committee from time to time in substitution thereof.


 


"Company"
means Alopexx, Inc. a Delaware corporation, and any successor thereto.


 


"Consultant"
means any individual or entity which performs bona fide services to the Company or an Affiliate, other than as an Employee or
Director, and who may be offered securities registerable pursuant to a registration statement on Form S-8 under the Securities
Act.


 


"Continuous
Service" means that the Participant's service with the Company or an Affiliate, whether as an Employee, Consultant or
Director, is not interrupted or terminated. The Participant's Continuous Service shall not be deemed to have terminated merely
because of a change in the capacity in which the Participant renders service to the Company or an Affiliate as an Employee, Consultant
or Director or a change in the entity for which the Participant renders such service, provided that there is no interruption
or termination of the Participant's Continuous Service; provided further that if any Award is subject to Section 409A of
the Code, this sentence shall only be given effect to the extent consistent with Section 409A of the Code. For example, a change
in status from an Employee of the Company to a Director of an Affiliate will not constitute an interruption of Continuous Service.
The Committee or its delegate, in its sole discretion, may determine whether Continuous Service shall be considered interrupted
in the case of any leave of absence approved by that party, including sick leave, military leave or any other personal or family
leave of absence. The Committee or its delegate, in its sole discretion, may determine whether a Company transaction, such as
a sale or spin-off of a division or subsidiary that employs a Participant, shall be deemed to result in a termination of Continuous
Service for purposes of affected Awards, and such decision shall be final, conclusive and binding.


 






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"Deferred
Stock Units (DSUs)" has the meaning set forth in Section 8.1(b) hereof.


 


"Director"
means a member of the Board.


 


"Disability"
means, unless the applicable Award Agreement says otherwise, that the Participant is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment; provided, however, for purposes of determining
the term of an Incentive Stock Option pursuant to Section 6.10 hereof, the term
Disability shall have the meaning ascribed to it under Section 22(e)(3) of the Code. The determination of whether an individual
has a Disability shall be determined under procedures established by the Committee. Except in situations where the Committee is
determining Disability for purposes of the term of an Incentive Stock Option pursuant to Section 6.10
hereof within the meaning of Section 22(e)(3) of the Code, the Committee may rely on any determination that a Participant
is disabled for purposes of benefits under any long-term disability plan maintained by the Company or any Affiliate in which a
Participant participates.


 


"Disqualifying
Disposition" has the meaning set forth in Section 17.12.


 


"Effective
Date" shall mean the date as of which the date that the Company's shareholders approve this Plan, which shall be upon
the consummation of the initial public offering. .


 


"Employee"
means any person, including an Officer or Director, employed by the Company or an Affiliate; provided, that, for purposes
of determining eligibility to receive Incentive Stock Options, an Employee shall mean an employee of the Company or a parent or
subsidiary corporation within the meaning of Section 424 of the Code. Mere service as a Director or payment of a director's fee
by the Company or an Affiliate shall not be sufficient to constitute "employment" by the Company or an Affiliate.


 


"Exchange
Act" means the Securities Exchange Act of 1934, as amended.


 


"Fair
Market Value" means, as of any date, the value of the Common Stock as determined below. If the Common Stock is listed
on any established stock exchange or a national market system, including without limitation, the Nasdaq Stock Market, the Fair
Market Value shall be the closing price of a share of Common Stock (or if no sales were reported the closing price on the date
immediately preceding such date) as quoted on such exchange or system on the day of determination, as reported in the Wall
Street Journal. In the absence of an established market for the Common Stock, the Fair Market Value shall be determined in
good faith by the Committee and such determination shall be conclusive and binding on all persons.


 


"Fiscal
Year" means the Company's fiscal year.


 


"Free
Standing Rights" has the meaning set forth in Section 7.


 






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"Good
Reason" means, unless the applicable Award Agreement states otherwise:


 


	 	(a)
                                         If an Employee or Consultant is a party to an employment or service agreement with the
                                         Company or its Affiliates and such agreement provides for a definition of Good Reason,
                                         the definition contained therein; or

         

        (b)
If no such agreement exists or if such agreement does not define Good Reason, the occurrence of one or more of the following without
the Participant's express written consent, which circumstances are not remedied by the Company within thirty (30) days of its
receipt of a written notice from the Participant describing the applicable circumstances (which notice must be provided by the
Participant within ninety (90) days of the Participant's knowledge of the applicable circumstances): (i) any material, adverse
change in the Participant's duties, responsibilities, authority, title, status or reporting structure;(ii) a material reduction
in the Participant's base salary or bonus opportunity; or (iii) a geographical relocation of the Participant's principal office
location by more than fifty (50) miles. 



 


"Grant
Date" means the date on which the Committee adopts a resolution, or takes other appropriate action, expressly granting
an Award to a Participant that specifies the key terms and conditions of the Award or, if a later date is set forth in such resolution,
then such date as is set forth in such resolution.


 


"Incentive
Stock Option" means an Option that is designated by the Committee as an incentive stock option within the meaning of
Section 422 of the Code and that meets the requirements set out in the Plan.


 


"Incumbent
Directors" means individuals who, on the Effective Date, constitute the Board, provided that any individual becoming
a Director subsequent to the Effective Date whose election or nomination for election to the Board was approved by a vote of at
least two-thirds of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement
of the Company in which such person is named as a nominee for Director without objection to such nomination) shall be an Incumbent
Director. No individual initially elected or nominated as a director of the Company as a result of an actual or threatened election
contest with respect to Directors or as a result of any other actual or threatened solicitation of proxies by or on behalf of
any person other than the Board shall be an Incumbent Director.


 


"Non-Employee
Director" means a Director who is a "non-employee director" within the meaning of Rule 16b-3.


 


"Non-qualified
Stock Option" means an Option that by its terms does not qualify or is not intended to qualify as an Incentive Stock
Option.


 


"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.


 






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"Option"
means an Incentive Stock Option or a Non-qualified Stock Option granted pursuant to the Plan.


 


"Optionholder"
means a person to whom an Option is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding
Option.


 


"Option
Exercise Price" means the price at which a share of Common Stock may be purchased upon the exercise of an Option.


 


"Other
Equity-Based Award" means an Award that is not an Option, Stock Appreciation Right, Restricted Stock, Restricted Stock
Unit, or Performance Share Award that is granted under Section 10 and is payable
by delivery of Common Stock and/or which is measured by reference to the value of Common Stock.


 


"Participant"
means an eligible person to whom an Award is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding
Award.


 


"Performance
Goals" means, for a Performance Period, the one or more goals established by the Committee for the Performance Period
based upon business criteria or other performance measures determined by the Committee in its discretion.


 


"Performance
Period" means the one or more periods of time, as the Committee may select, over which the attainment of one or more
Performance Goals will be measured for the purpose of determining a Participant's right to and the payment of a Performance Share
Award or a Cash Award.


 


"Performance
Share Award" means any Award granted pursuant to Section 9 hereof.


 


"Performance
Share" means the grant of a right to receive a number of actual shares of Common Stock or share units based upon the
performance of the Company during a Performance Period, as determined by the Committee.


 


"Permitted
Transferee" means: (a) a member of the Participant's immediate family (child, stepchild, grandchild, parent, stepparent,
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 Participant's household (other than a tenant or employee),
a trust in which these persons have more than 50% of the beneficial interest, a foundation in which these persons (or the Participant)
control the management of assets, and any other entity in which these persons (or the Participant) own more than 50% of the voting
interests; (b) third parties designated by the Committee in connection with a program established and approved by the Committee
pursuant to which Participants may receive a cash payment or other consideration in consideration for the transfer of a Non-qualified
Stock Option; and (c) such other transferees as may be permitted by the Committee in its sole discretion.


 


"Person"
means a person as defined in Section 13(d)(3) of the Exchange Act.


 






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"Plan"
means this Alopexx, Inc. 2022 Equity Incentive Plan, as amended and/or amended and restated from time to time.


 


"Related
Rights" has the meaning set forth in Section 7.


 


"Restricted
Award" means any Award granted pursuant to Section 8.


 


"Restricted
Period" has the meaning set forth in Section 8.


 


"Rule
16b-3" means Rule 16b-3 promulgated under the Exchange Act or any successor to Rule 16b-3, as in effect from time to
time.


 


"Securities
Act" means the Securities Act of 1933, as amended.


 


"Stock
Appreciation Right" means the right pursuant to an Award granted under Section 7 to receive, upon exercise, an amount payable in cash or shares equal to the number of shares subject to the Stock Appreciation
Right that is being exercised multiplied by the excess of (a) the Fair Market Value of a share of Common Stock on the date the
Award is exercised, over (b) the exercise price specified in the Stock Appreciation Right Award Agreement.


 


"Stock
for Stock Exchange" has the meaning set forth in Section 6.4.


 


"Substitute
Award" has the meaning set forth in Section 4.6.


 


"Ten
Percent Shareholder" means a person who owns (or is deemed to own pursuant to Section 424(d) of the Code) stock possessing
more than 10% of the total combined voting power of all classes of stock of the Company or of any of its Affiliates.


 


"Total
Share Reserve" has the meaning set forth in Section 4.1.


 


3.          Administration.


 


3.1           Authority of Committee. The Plan shall
be administered by the Committee or, in the Board's sole discretion, by the Board. Subject to the terms of the Plan, the Committee's
charter and Applicable Laws, and in addition to other express powers and authorization conferred by the Plan, the Committee shall
have the authority:


 


(a)         to construe and interpret the Plan and apply its provisions;


 


(b)         to promulgate, amend, and rescind rules and regulations relating to the administration of the Plan;


 


(c)         to authorize any person to execute, on behalf of the Company, any instrument required to carry out the purposes of the Plan;


 


(d)         to delegate its authority to one or more Officers of the Company with respect to Awards that do not involve "insiders"
within the meaning of Section 16 of the Exchange Act;


 






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(e)         to determine when Awards are to be granted under the Plan and the applicable Grant Date;


 


(f)          from time to time to select, subject to the limitations set forth in this Plan, those eligible Award recipients to whom Awards
shall be granted;


 


(g)         to determine the number of shares of Common Stock to be made subject to each Award;


 


(h)         to determine the type of Award to be granted and for Options, whether each Option is to be an Incentive Stock Option or a Non-qualified
Stock Option;


 


(i)          to prescribe the terms and conditions of each Award, including, without limitation, the exercise price and medium of payment and
vesting provisions, and to specify the provisions of the Award Agreement relating to such grant;


 


(j)          to determine the target number of Performance Shares to be granted pursuant to a Performance Share Award, the performance measures
that will be used to establish the Performance Goals, the Performance Period(s) and the number of Performance Shares earned by
a Participant;


 


(k)         to amend any outstanding Awards, including for the purpose of modifying the time or manner of vesting, or the term of any outstanding
Award; provided, however, that if any such amendment impairs a Participant's rights or increases a Participant's obligations
under his or her Award or creates or increases a Participant's federal income tax liability with respect to an Award, such amendment
shall also be subject to the Participant's consent;


 


(l)          to determine the duration and purpose of leaves of absences which may be granted to a Participant without constituting termination
of their employment for purposes of the Plan, which periods shall be no shorter than the periods generally applicable to Employees
under the Company's employment policies;


 


(m)        to make decisions with respect to outstanding Awards that may become necessary upon a change in corporate control or an event
that triggers anti-dilution adjustments;


 


(n)         to interpret, administer, reconcile any inconsistency in, correct any defect in and/or supply any omission in the Plan and any
instrument or agreement relating to, or Award granted under, the Plan; and


 


(o)         to exercise discretion to make any and all other determinations which it determines to be necessary or advisable for the administration
of the Plan.


 


The
Committee also may modify the purchase price or the exercise price of any outstanding Award, including, without limitation,
any modification that effects a repricing without any additional shareholder approvals.


 






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3.2           Committee Decisions Final. All decisions
made by the Committee pursuant to the provisions of the Plan shall be final and binding on the Company and the Participants, unless
such decisions are determined by a court having jurisdiction to be arbitrary and capricious.


 


3.3           Delegation. The Committee or, if no Committee
has been appointed, the Board may delegate administration of the Plan to a committee or committees of one or more members of the
Board including but not limited to the Compensation Committee, and the term "Committee" shall apply to any person
or persons to whom such authority has been delegated. The Committee shall have the power to delegate to a subcommittee any of
the administrative powers the Committee is authorized to exercise (and references in this Plan to the Board or the Committee shall
thereafter be to the committee or subcommittee), subject, however, to such resolutions, not inconsistent with the provisions of
the Plan, as may be adopted from time to time by the Board. The Board may abolish the Committee at any time and revest in the
Board the administration of the Plan. The members of the Committee shall be appointed by and serve at the pleasure of the Board.
From time to time, the Board may increase or decrease the size of the Committee, add additional members to, remove members (with
or without cause) from, appoint new members in substitution therefor, and fill vacancies, however caused, in the Committee. The
Committee shall act pursuant to a vote of the majority of its members or, in the case of a Committee comprised of only two members,
the unanimous consent of its members, whether present or not, or by the written consent of the majority of its members and minutes
shall be kept of all of its meetings and copies thereof shall be provided to the Board. Subject to the limitations prescribed
by the Plan and the Board, the Committee may establish and follow such rules and regulations for the conduct of its business as
it may determine to be advisable.


 


3.4           Committee Composition. Except as otherwise
determined by the Board, the Committee shall consist solely of two or more Non-Employee Directors. The Board shall have discretion
to determine whether or not it intends to comply with the exemption requirements of Rule 16b-3. However, if the Board intends
to satisfy such exemption requirements, with respect to any insider subject to Section 16 of the Exchange Act, the Committee shall
be a compensation committee of the Board that at all times consists solely of two or more Non-Employee Directors. Within the scope
of such authority, the Board or the Committee may delegate to a committee of one or more members of the Board who are not Non-Employee
Directors the authority to grant Awards to eligible persons who are not then subject to Section 16 of the Exchange Act. Nothing
herein shall create an inference that an Award is not validly granted under the Plan in the event Awards are granted under the
Plan by a compensation committee of the Board that does not at all times consist solely of two or more Non-Employee Directors.


 


3.5           Indemnification. In addition to such other
rights of indemnification as they may have as Directors or members of the Committee, and to the extent allowed by Applicable Laws,
the Committee shall be indemnified by the Company against the reasonable expenses, including attorney's fees, actually incurred
in connection with any action, suit or proceeding or in connection with any appeal therein, to which the Committee may be party
by reason of any action taken or failure to act under or in connection with the Plan or any Award granted under the Plan, and
against all amounts paid by the Committee in settlement thereof (provided, however, that the settlement has been approved
by the Company, which approval shall not be unreasonably withheld) or paid by the Committee 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 Committee did not act in good faith and in a manner which such person reasonably believed to be in the best interests
of the Company, or in the case of a criminal proceeding, had no reason to believe that the conduct complained of was unlawful;
provided, however, that within 60 days after the institution of any such action, suit or proceeding, such Committee shall,
in writing, offer the Company the opportunity at its own expense to handle and defend such action, suit or proceeding.


 






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4.         Shares Subject to the Plan.


 


4.1           Subject to adjustment in accordance with Section 14, no more than [2,500,000] shares
of Common Stock shall be available for the grant of Awards under the Plan; and commencing on January 1, 2023, and on the first
day of each calendar year through 2032, the number of shares of Common Stock available for issuance shall be increased by five
percent (5%) of the number of shares of Common Stock outstanding, as that number is determined by the Company, as of the preceding
fiscal year end or such lesser number as determined by the Committee (the "Total Share Reserve").
During the terms of the Awards, the Company shall keep available at all times the number of shares of Common Stock required to
satisfy such Awards.


 


4.2           Shares of Common Stock available for distribution under the Plan may consist, in whole or in part, of authorized and unissued
shares, treasury shares or shares reacquired by the Company in any manner.


 


4.3           Subject to adjustment in accordance with Section 14, no more than [2,500,000] shares
of Common Stock may be issued in the aggregate pursuant to the exercise of Incentive Stock Options (the "ISO Limit").


 


4.4           The maximum number of shares of Common Stock subject to Awards granted during a single Fiscal Year to any Director, together with
any cash fees paid to such Director during the Fiscal Year shall not exceed a total value of $750,000 (calculating the value of
any Awards based on the grant date fair value for financial reporting purposes).


 


4.5           Notwithstanding anything to the contrary contained herein: shares subject to an Award under the Plan shall not again be made available
for issuance or delivery under the Plan if such shares are (a) shares tendered in payment of an Option, (b) shares delivered or
withheld by the Company to satisfy any tax withholding obligation, or (c) shares covered by a stock-settled Stock Appreciation
Right or other Awards that were not issued upon the settlement of the Award.


 


4.6           Awards may, in the sole discretion of the Committee, be granted under the Plan in assumption of, or in substitution for, outstanding
awards previously granted by an entity acquired by the Company or with which the Company combines ("Substitute
Awards"). Substitute Awards shall not be counted against the Total Share Reserve; provided, that, Substitute
Awards issued in connection with the assumption of, or in substitution for, outstanding options intended to qualify as Incentive
Stock Options shall be counted against the ISO limit. Subject to applicable stock exchange requirements, available shares under
a shareholder-approved plan of an entity directly or indirectly acquired by the Company or with which the Company combines (as
appropriately adjusted to reflect such acquisition or transaction) may be used for Awards under the Plan and shall not count toward
the Total Share Limit; provided that Awards using such available Shares shall not be made after the date awards or grants
could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to
individuals who were not employed by or providing services to the Company or its Subsidiaries immediately prior to such acquisition
or combination.


 






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5.         Eligibility.


 


5.1           Eligibility for Specific Awards. Incentive
Stock Options may be granted only to Employees. Awards other than Incentive Stock Options may be granted to Employees, Consultants
and Directors and those individuals whom the Committee determines are reasonably expected to become Employees, Consultants and
Directors following the Grant Date.


 


5.2           Ten Percent Shareholders. A Ten Percent
Shareholder shall not be granted an Incentive Stock Option unless the Option Exercise Price is at least 110% of the Fair Market
Value of the Common Stock on the Grant Date and the Option is not exercisable after the expiration of five years from the Grant
Date.


 


6.         Option Provisions.
Each Option granted under the Plan shall be evidenced by an Award Agreement. Each Option so granted shall be subject to the conditions
set forth in this Section 6, and to such other conditions not inconsistent with the Plan as may be reflected in the applicable
Award Agreement. All Options shall be separately designated Incentive Stock Options or Non-qualified Stock Options at the time
of grant, and, if certificates are issued, a separate certificate or certificates will be issued for shares of Common Stock purchased
on exercise of each type of Option. Notwithstanding the foregoing, the Company shall have no liability to any Participant or any
other person if an Option designated as an Incentive Stock Option fails to qualify as such at any time or if an Option is determined
to constitute "nonqualified deferred compensation" within the meaning of Section 409A of the Code and the terms of such
Option do not satisfy the requirements of Section 409A of the Code. The provisions of separate Options need not be identical,
but each Option shall include (through incorporation of provisions hereof by reference in the Option or otherwise) the substance
of each of the following provisions:


 


6.1           Term. Subject to the provisions of Section
5.2 regarding Ten Percent Shareholders, no Incentive Stock Option shall be exercisable
after the expiration of 10 years from the Grant Date. The term of a Non-qualified Stock Option granted under the Plan shall be
determined by the Committee; provided, however, no Non-qualified Stock Option shall be exercisable after the expiration
of 10 years from the Grant Date.


 






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6.2           Exercise Price of an Incentive Stock Option.
Subject to the provisions of Section 5.2 regarding Ten Percent Shareholders, the
Option Exercise Price of each Incentive Stock Option shall be not less than 100% of the Fair Market Value of the Common Stock
subject to the Option on the Grant Date. Notwithstanding the foregoing, an Incentive Stock Option may be granted with an Option
Exercise Price lower than that set forth in the preceding sentence if such Option is granted pursuant to an assumption or substitution
for another option in a manner satisfying the provisions of Section 424(a) of the Code.


 


6.3           Exercise Price of a Non-qualified Stock Option.
The Option Exercise Price of each Non-qualified Stock Option shall be not less than 100% of the Fair Market Value of the Common
Stock subject to the Option on the Grant Date. Notwithstanding the foregoing, a Non-qualified Stock Option may be granted with
an Option Exercise Price lower than that set forth in the preceding sentence if such Option is granted pursuant to an assumption
or substitution for another option in a manner satisfying the provisions of Section 409A of the Code.


 


6.4           Consideration. The Option Exercise Price
of Common Stock acquired pursuant to an Option shall be paid, to the extent permitted by applicable statutes and regulations,
either (a) in cash or by certified or bank check at the time the Option is exercised or (b) in the discretion of the Committee,
upon such terms as the Committee shall approve, the Option Exercise Price may be paid: (i) by delivery to the Company of other
Common Stock, duly endorsed for transfer to the Company, with a Fair Market Value on the date of delivery equal to the Option
Exercise Price (or portion thereof) due for the number of shares being acquired, or by means of attestation whereby the Participant
identifies for delivery specific shares of Common Stock that have an aggregate Fair Market Value on the date of attestation equal
to the Option Exercise Price (or portion thereof) and receives a number of shares of Common Stock equal to the difference between
the number of shares thereby purchased and the number of identified attestation shares of Common Stock (a "Stock for Stock
Exchange"); (ii) a "cashless" exercise program established with a broker; (iii) by reduction in the number
of shares of Common Stock otherwise deliverable upon exercise of such Option with a Fair Market Value equal to the aggregate Option
Exercise Price at the time of exercise; (iv) by any combination of the foregoing methods; or (v) in any other form of legal consideration
that may be acceptable to the Committee. Unless otherwise specifically provided in the Option, the exercise price of Common Stock
acquired pursuant to an Option that is paid by delivery (or attestation) to the Company of other Common Stock acquired, directly
or indirectly from the Company, shall be paid only by shares of the Common Stock of the Company that have been held for more than
six months (or such longer or shorter period of time required to avoid a charge to earnings for financial accounting purposes).


 


6.5           Transferability of an Incentive Stock Option.
An Incentive Stock Option shall not be transferable except by will or by the laws of descent and distribution and shall be exercisable
during the lifetime of the Optionholder only by the Optionholder. Notwithstanding the foregoing, the Optionholder may, by delivering
written notice to the Company, in a form satisfactory to the Company, designate a third party who, in the event of the death of
the Optionholder, shall thereafter be entitled to exercise the Option.


 






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6.6           Transferability of a Non-qualified Stock Award.
A Non-qualified Stock Award (other than a Restricted Award) may, in the sole discretion of the Committee, be transferable to a
Permitted Transferee, upon written approval by the Committee to the extent provided in the Award Agreement. If the Non-qualified
Stock Option does not provide for transferability, then the Non-qualified Stock Option shall not be transferable except by will
or by the laws of descent and distribution and shall be exercisable during the lifetime of the Optionholder only by the Optionholder.
Notwithstanding the foregoing, the Optionholder may, by delivering written notice to the Company, in a form satisfactory to the
Company, designate a third party who, in the event of the death of the Optionholder, shall thereafter be entitled to exercise
the Option.


 


6.7           Vesting of Options. Each Option may, but
need not, vest and therefore become exercisable in periodic installments that may, but need not, be equal. The Option may be subject
to such other terms and conditions on the time or times when it may be exercised (which may be based on performance or other criteria)
as the Committee may deem appropriate. The vesting provisions of individual Options may vary. No Option may be exercised for a
fraction of a share of Common Stock. The Committee may, but shall not be required to, provide for an acceleration of vesting and
exercisability in the terms of any Award Agreement upon the occurrence of a specified event.


 


6.8           Termination of Continuous Service. Unless
otherwise provided in an Award Agreement or in an employment agreement the terms of which have been approved by the Committee,
in the event an Optionholder's Continuous Service terminates (other than upon the Optionholder's death or Disability), the Optionholder
may exercise his or her Option (to the extent that the Optionholder was entitled to exercise such Option as of the date of termination)
but only within such period of time ending on the earlier of (a) the date three months following the termination of the Optionholder's
Continuous Service or (b) the expiration of the term of the Option as set forth in the Award Agreement; provided that,
if the termination of Continuous Service is by the Company for Cause, all outstanding Options (whether or not vested) shall immediately
terminate and cease to be exercisable. If, after termination, the Optionholder does not exercise his or her Option within the
time specified in the Award Agreement, the Option shall terminate.


 


6.9           Extension of Termination Date. An Optionholder's
Award Agreement may also provide that if the exercise of the Option following the termination of the Optionholder's Continuous
Service for any reason would be prohibited at any time because the issuance of shares of Common Stock would violate the registration
requirements under the Securities Act or any other state or federal securities law or the rules of any securities exchange or
interdealer quotation system, then the Option shall terminate on the earlier of (a) the expiration of the term of the Option in
accordance with Section 6.1 or (b) the expiration of a period after termination
of the Participant's Continuous Service that is three months after the end of the period during which the exercise of the Option
would be in violation of such registration or other securities law requirements.


 


6.10         Disability of Optionholder. Unless otherwise
provided in an Award Agreement, in the event that an Optionholder's Continuous Service terminates as a result of the Optionholder's
Disability, the Optionholder may exercise his or her Option (to the extent that the Optionholder was entitled to exercise such
Option as of the date of termination), but only within such period of time ending on the earlier of (a) the date 12 months following
such termination or (b) the expiration of the term of the Option as set forth in the Award Agreement.


 






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6.11         Death of Optionholder. Unless otherwise
provided in an Award Agreement, in the event an Optionholder's Continuous Service terminates as a result of the Optionholder's
death, then the Option may be exercised (to the extent the Optionholder was entitled to exercise such Option as of the date of
death) by the Optionholder's estate, by a person who acquired the right to exercise the Option by bequest or inheritance or by
a person designated to exercise the Option upon the Optionholder's death, but only within the period ending on the earlier of
(a) the date 12 months following the date of death or (b) the expiration of the term of such Option as set forth in the Award
Agreement.


 


6.12         Incentive Stock Option $100,000 Limitation.
To the extent that the aggregate Fair Market Value (determined at the time of grant) of Common Stock with respect to which Incentive
Stock Options are exercisable for the first time by any Optionholder during any calendar year (under all plans of the Company
and its Affiliates) exceeds $100,000, the Options or portions thereof which exceed such limit (according to the order in which
they were granted) shall be treated as Non-qualified Stock Options.


 


7.         Stock Appreciation Rights.
Each Stock Appreciation Right granted under the Plan shall be evidenced by an Award Agreement. Each Stock Appreciation Right so
granted shall be subject to the conditions set forth in this Section 7, and to such other conditions not inconsistent with the
Plan as may be reflected in the applicable Award Agreement. Stock Appreciation Rights may be granted alone ("Free Standing
Rights") or in tandem with an Option granted under the Plan ("Related Rights").


 


7.1           Grant Requirements for Related Rights.
 Any Related Right that relates to a Non-qualified Stock Option may be granted at the same time the Option is granted or
at any time thereafter but before the exercise or expiration of the Option.


 


7.2           Term The term of a Stock Appreciation
Right granted under the Plan shall be determined by the Committee; provided, however, no Stock Appreciation Right shall
be exercisable later than the tenth anniversary of the Grant Date.


 


7.3           Vesting


 


Each
Stock Appreciation Right may, but need not, vest and therefore become exercisable in periodic installments that may, but need
not, be equal. The Stock Appreciation Right may be subject to such other terms and conditions on the time or times when it may
be exercised as the Committee may deem appropriate. The vesting provisions of individual Stock Appreciation Rights may vary. No
Stock Appreciation Right may be exercised for a fraction of a share of Common Stock. The Committee may, but shall not be required
to, provide for an acceleration of vesting and exercisability in the terms of any Stock Appreciation Right upon the occurrence
of a specified event.


 






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7.4           Exercise and Payment Upon exercise of
a Stock Appreciation Right, the holder shall be entitled to receive from the Company an amount equal to the number of shares of
Common Stock subject to the Stock Appreciation Right that is being exercised multiplied by the excess of (i) the Fair Market Value
of a share of Common Stock on the date the Award is exercised, over (ii) the exercise price specified in the Stock Appreciation
Right or related Option. Payment with respect to the exercise of a Stock Appreciation Right shall be made on the date of exercise.
Payment shall be made in the form of shares of Common Stock (with or without restrictions as to substantial risk of forfeiture
and transferability, as determined by the Committee in its sole discretion), cash or a combination thereof, as determined by the
Committee.


 


7.5           Exercise Price The exercise price of a
Free Standing Right shall be determined by the Committee, but shall not be less than 100% of the Fair Market Value of one share
of Common Stock on the Grant Date of such Stock Appreciation Right. A Related Right granted simultaneously with or subsequent
to the grant of an Option and in conjunction therewith or in the alternative thereto shall have the same exercise price as the
related Option, shall be transferable only upon the same terms and conditions as the related Option, and shall be exercisable
only to the same extent as the related Option; provided, however, that a Stock Appreciation Right, by its terms, shall
be exercisable only when the Fair Market Value per share of Common Stock subject to the Stock Appreciation Right and related Option
exceeds the exercise price per share thereof and no Stock Appreciation Rights may be granted in tandem with an Option unless the
Committee determines that the requirements of Section 7.1 are satisfied.


 


7.6           Reduction in the Underlying Option Shares
Upon any exercise of a Related Right, the number of shares of Common Stock for which any related Option shall be exercisable shall
be reduced by the number of shares for which the Stock Appreciation Right has been exercised. The number of shares of Common Stock
for which a Related Right shall be exercisable shall be reduced upon any exercise of any related Option by the number of shares
of Common Stock for which such Option has been exercised.


 


8.         Restricted Awards
A Restricted Award is an Award of actual shares of Common Stock ("Restricted Stock") or hypothetical Common Stock
units ("Restricted Stock Units") having a value equal to the Fair Market Value of an identical number of shares
of Common Stock, which may, but need not, provide that such Restricted Award may not be sold, assigned, transferred or otherwise
disposed of, pledged or hypothecated as collateral for a loan or as security for the performance of any obligation or for any
other purpose for such period (the "Restricted Period") as the Committee shall determine. Each Restricted Award
granted under the Plan shall be evidenced by an Award Agreement. Each Restricted Award so granted shall be subject to the conditions
set forth in this Section 8, and to such other conditions not inconsistent with the Plan as may be reflected in the applicable
Award Agreement.


 






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8.1          Restricted Stock and Restricted Stock Units


 


(a)         Each Participant granted Restricted Stock shall execute and deliver to the Company an Award Agreement with respect to the Restricted
Stock setting forth the restrictions and other terms and conditions applicable to such Restricted Stock. If the Committee determines
that the Restricted Stock shall be held by the Company or in escrow rather than delivered to the Participant pending the release
of the applicable restrictions, the Committee may require the Participant to additionally execute and deliver to the Company (A)
an escrow agreement satisfactory to the Committee, if applicable and (B) the appropriate blank stock power with respect to the
Restricted Stock covered by such agreement. If a Participant fails to execute an agreement evidencing an Award of Restricted Stock
and, if applicable, an escrow agreement and stock power, the Award shall be null and void. Subject to the restrictions set forth
in the Award, the Participant generally shall have the rights and privileges of a shareholder as to such Restricted Stock, including
the right to vote such Restricted Stock and the right to receive dividends; provided that, any cash dividends and stock
dividends with respect to the Restricted Stock shall be withheld by the Company for the Participant's account. The cash dividends
or stock dividends so withheld by the Committee and attributable to any particular share of Restricted Stock (and earnings thereon,
if applicable) shall be distributed to the Participant in cash or, at the discretion of the Committee, in shares of Common Stock
having a Fair Market Value equal to the amount of such dividends, if applicable, upon the release of restrictions on such share
and, if such share is forfeited, the Participant shall have no right to such dividends.


 


(b)         The terms and conditions of a grant of Restricted Stock Units shall be reflected in an Award Agreement. No shares of Common Stock
shall be issued at the time a Restricted Stock Unit is granted, and the Company will not be required to set aside funds for the
payment of any such Award. A Participant shall have no voting rights with respect to any Restricted Stock Units granted hereunder.
The Committee may also grant Restricted Stock Units with a deferral feature, whereby settlement is deferred beyond the vesting
date until the occurrence of a future payment date or event set forth in an Award Agreement ("Deferred Stock Units")
in compliance with Applicable Laws including Section 409A of the Code. At the discretion of the Committee, each vested Restricted
Stock Unit or vested Deferred Stock Unit (representing one share of Common Stock) may be credited with an amount equal to the
cash and stock dividends paid by the Company in respect of one share of Common Stock ("Dividend Equivalents").


 


8.2          Restrictions


 


(a)         Restricted Stock awarded to a Participant shall be subject to the following restrictions until the expiration of the Restricted
Period, and to such other terms and conditions as may be set forth in the applicable Award Agreement: (A) if an escrow arrangement
is used, the Participant shall not be entitled to delivery of the stock certificate; (B) the shares shall be subject to the restrictions
on transferability set forth in the Award Agreement; (C) the shares shall be subject to forfeiture to the extent provided in the
applicable Award Agreement; and (D) to the extent such shares are forfeited, the stock certificates shall be returned to the Company,
and all rights of the Participant to such shares and as a shareholder with respect to such shares shall terminate without further
obligation on the part of the Company.


 






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(b)           Restricted Stock Units and Deferred Stock Units awarded to any Participant shall be subject to (A) forfeiture until the expiration
of the Restricted Period, and satisfaction of any applicable Performance Goals during such period, to the extent provided in the
applicable Award Agreement, and to the extent such Restricted Stock Units or Deferred Stock Units are forfeited, all rights of
the Participant to such Restricted Stock Units or Deferred Stock Units shall terminate without further obligation on the part
of the Company and (B) such other terms and conditions as may be set forth in the applicable Award Agreement.


 


(c)           The Committee shall have the authority to remove any or all of the restrictions on the Restricted Stock, Restricted Stock Units
and Deferred Stock Units whenever it may determine that, by reason of changes in Applicable Laws or other changes in circumstances
arising after the date the Restricted Stock or Restricted Stock Units or Deferred Stock Units are granted, such action is appropriate.


 


8.3          Restricted Period


 


With
respect to Restricted Awards, the Restricted Period shall commence on the Grant Date and end at the time or times set forth on
a schedule established by the Committee in the applicable Award Agreement.


 


No
Restricted Award may be granted or settled for a fraction of a share of Common Stock. The Committee may, but shall not be required
to, provide for an acceleration of vesting in the terms of any Award Agreement upon the occurrence of a specified event.


 


8.4          Delivery of Restricted Stock and Settlement of Restricted
Stock Units Upon the expiration of the Restricted Period with respect to any shares of Restricted Stock, the restrictions
set forth in Section 8.2 and the applicable Award Agreement shall be of no further
force or effect with respect to such shares, except as set forth in the applicable Award Agreement. If an escrow arrangement is
used, upon such expiration, the Company shall deliver to the Participant, or his or her beneficiary, without charge, the stock
certificate evidencing the shares of Restricted Stock which have not then been forfeited and with respect to which the Restricted
Period has expired (to the nearest full share) and any cash dividends or stock dividends credited to the Participant's account
with respect to such Restricted Stock and the interest thereon, if any. Upon the expiration of the Restricted Period with respect
to any outstanding Restricted Stock Units, or at the expiration of the deferral period with respect to any outstanding Deferred
Stock Units, the Company shall deliver to the Participant, or his or her beneficiary, without charge, one share of Common Stock
for each such outstanding vested Restricted Stock Unit or Deferred Stock Unit ("Vested Unit") and cash equal
to any Dividend Equivalents credited with respect to each such Vested Unit in accordance with Section 8.1(b)
hereof and the interest thereon or, at the discretion of the Committee, in shares of Common Stock having a Fair Market
Value equal to such Dividend Equivalents and the interest thereon, if any; provided, however, that, if explicitly provided
in the applicable Award Agreement, the Committee may, in its sole discretion, elect to pay cash or part cash and part Common Stock
in lieu of delivering only shares of Common Stock for Vested Units. If a cash payment is made in lieu of delivering shares of
Common Stock, the amount of such payment shall be equal to the Fair Market Value of the Common Stock as of the date on which the
Restricted Period lapsed in the case of Restricted Stock Units, or the delivery date in the case of Deferred Stock Units, with
respect to each Vested Unit.


 






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8.5           Stock Restrictions Each certificate representing
Restricted Stock awarded under the Plan shall bear a legend in such form as the Company deems appropriate.


 


9.         Performance Share Awards
Each Performance Share Award granted under the Plan shall be evidenced by an Award Agreement. Each Performance Share
Award so granted shall be subject to the conditions set forth in this Section 9, and to such other conditions not inconsistent
with the Plan as may be reflected in the applicable Award Agreement. The Committee shall have the discretion to determine: (i)
the number of shares of Common Stock or stock-denominated units subject to a Performance Share Award granted to any Participant;
(ii) the Performance Period applicable to any Award; (iii) the conditions that must be satisfied for a Participant to earn an
Award; and (iv) the other terms, conditions and restrictions of the Award.


 


9.1           Earning Performance Share Awards The number
of Performance Shares earned by a Participant will depend on the extent to which the performance goals established by the Committee
are attained within the applicable Performance Period, as determined by the Committee.


 


10.      
Other Equity-Based Awards and Cash Awards The
Committee may grant Other Equity-Based Awards, either alone or in tandem with other Awards, in such amounts and subject to such
conditions as the Committee shall determine in its sole discretion. Each Equity-Based Award shall be evidenced by an Award Agreement
and shall be subject to such conditions, not inconsistent with the Plan, as may be reflected in the applicable Award Agreement.


 


11.      
Securities Law Compliance.
Each Award Agreement shall provide that no shares of Common Stock shall be purchased or sold thereunder unless and until (a) any
then applicable requirements of state or federal laws and regulatory agencies have been fully complied with to the satisfaction
of the Company and its counsel and (b) if required to do so by the Company, the Participant has executed and delivered to the
Company a letter of investment intent in such form and containing such provisions as the Committee may require. The Company shall
use reasonable efforts to seek to obtain from each regulatory commission or agency having jurisdiction over the Plan such authority
as may be required to grant Awards and to issue and sell shares of Common Stock upon exercise of the Awards; provided, however,
that this undertaking shall not require the Company to register under the Securities Act the Plan, any Award or any Common Stock
issued or issuable pursuant to any such Award. If, after reasonable efforts, the Company is unable to obtain from any such regulatory
commission or agency the authority which counsel for the Company deems necessary for the lawful issuance and sale of Common Stock
under the Plan, the Company shall be relieved from any liability for failure to issue and sell Common Stock upon exercise of such
Awards unless and until such authority is obtained.


 






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12.       
Use of Proceeds from Stock.
Proceeds from the sale of Common Stock pursuant to Awards, or upon exercise thereof, shall constitute general funds of the Company.


 


13.       
Miscellaneous.


 


13.1        
Acceleration of Exercisability and Vesting.
The Committee shall have the power to accelerate the time at which an Award may first be exercised or the time during which an
Award or any part thereof will vest in accordance with the Plan, notwithstanding the provisions in the Award stating the time
at which it may first be exercised or the time during which it will vest.


 


13.2        
Shareholder Rights. Except as provided
in the Plan or an Award Agreement, no Participant shall be deemed to be the holder of, or to have any of the rights of a holder
with respect to, any shares of Common Stock subject to such Award unless and until such Participant has satisfied all requirements
for exercise of the Award pursuant to its terms and no adjustment shall be made for dividends (ordinary or extraordinary, whether
in cash, securities or other property) or distributions of other rights for which the record date is prior to the date such Common
Stock certificate is issued, except as provided in Section 14 hereof.


 


13.3        
No Employment or Other Service Rights.
Nothing in the Plan or any instrument executed or Award granted pursuant thereto shall confer upon any Participant any right to
continue to serve the Company or an Affiliate in the capacity in effect at the time the Award was granted or shall affect the
right of the Company or an Affiliate to terminate (a) the employment of an Employee with or without notice and with or without
Cause or (b) the service of a Director pursuant to the By-laws of the Company or an Affiliate, and any applicable provisions of
the corporate law of the state in which the Company or the Affiliate is incorporated, as the case may be.


 


13.4        
Transfer; Approved Leave of Absence. For
purposes of the Plan, no termination of employment by an Employee shall be deemed to result from either (a) a transfer of employment
to the Company from an Affiliate or from the Company to an Affiliate, or from one Affiliate to another, or (b) an approved leave
of absence for military service or sickness, or for any other purpose approved by the Company, if the Employee's right to reemployment
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, in either case, except to the extent inconsistent with Section 409A of the Code
if the applicable Award is subject thereto.


 


13.5        
Withholding Obligations. To the extent
provided by the terms of an Award Agreement and subject to the discretion of the Committee, the Participant may satisfy any federal,
state or local tax withholding obligation relating to the exercise or acquisition of Common Stock under an Award by any of the
following means (in addition to the Company's right to withhold from any compensation paid to the Participant by the Company)
or by a combination of such means: (a) tendering a cash payment; (b) authorizing the Company to withhold shares of Common Stock
from the shares of Common Stock otherwise issuable to the Participant as a result of the exercise or acquisition of Common Stock
under the Award, provided, however, that no shares of Common Stock are withheld with a value exceeding the maximum amount
of tax required to be withheld by law; or (c) delivering to the Company previously owned and unencumbered shares of Common Stock
of the Company.


 






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14.       
Adjustments Upon Changes
in Stock.


 


14.1        
In the event of changes in the outstanding Common Stock or in the capital structure of the Company by reason of any stock or extraordinary
cash dividend, stock split, reverse stock split, an extraordinary corporate transaction such as any recapitalization, reorganization,
merger, consolidation, combination, exchange, or other relevant change in capitalization occurring after the Grant Date of any
Award, Awards granted under the Plan and any Award Agreements, the exercise price of Options and Stock Appreciation Rights, the
Performance Goals to which Performance Share Awards and Cash Awards are subject, the maximum number of shares of Common Stock
subject to all Awards stated in Section 4 will be equitably adjusted or substituted,
as to the number, price or kind of a share of Common Stock or other consideration subject to such Awards to the extent necessary
to preserve the economic intent of such Award. In the case of adjustments made pursuant to this Section 14, unless the Committee
specifically determines that such adjustment is in the best interests of the Company or its Affiliates, the Committee shall, in
the case of Incentive Stock Options, ensure that any adjustments under this Section 14 will not constitute a modification, extension
or renewal of the Incentive Stock Options within the meaning of Section 424(h)(3) of the Code and in the case of Non-qualified
Stock Options, ensure that any adjustments under this Section 14 will not constitute a modification of such Non-qualified Stock
Options within the meaning of Section 409A of the Code. Any adjustments made under this Section 14 shall be made in a manner which
does not adversely affect the exemption provided pursuant to Rule 16b-3 under the Exchange Act. The Company shall give each Participant
notice of an adjustment hereunder and, upon notice, such adjustment shall be conclusive and binding for all purposes.


 






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14.2
A Reorganization Event means: (a) any merger or consolidation of the Company with or into another
entity as a result of which all of the Common Stock of the Company is converted into or exchanged for the right to receive cash,
securities or other property or is canceled, (b) any transfer or disposition of all of the Common Stock of the Company for cash,
securities or other property pursuant to a share exchange or other transaction or (c) any liquidation or dissolution of the Company.
In connection with any Reorganization Event, the Board may take any one or more of the following actions as to all or any (or
any portion of) outstanding Awards other than Restricted Stock on such terms as the Board determines (except to the extent specifically
provided otherwise in an applicable Award agreement or another agreement between the Company and the Participant): 


 


(i) provide
that such Awards shall be assumed, or substantially equivalent Awards shall be substituted, by the acquiring or succeeding corporation
(or an affiliate thereof); 


 


(ii) upon
written notice to a Participant, provide that all of the Participant’s unvested Awards will be forfeited immediately prior
to the consummation of such Reorganization Event and/ or that all of the Participant’s unexercised Awards will terminate
immediately prior to the consummation of such Reorganization Event unless exercised by the Participant (to the extent then exercisable)
within a specified period following the date of such notice;


 


(iii) provide
that outstanding Awards shall become exercisable, realizable or deliverable, or restrictions applicable to an Award shall lapse,
in whole or in part prior to or upon such Reorganization Event;


 


(iv) in
the event of a Reorganization Event under the terms of which holders of Common Stock will receive upon consummation thereof a
cash payment for each share surrendered in the Reorganization Event (the “Acquisition Price”), make or provide for
a cash payment to Participants with respect to each Award held by a Participant equal to (A) the number of shares of Common Stock
subject to the vested portion of the Award (after giving effect to any acceleration of vesting that occurs upon or immediately
prior to such Reorganization Event) multiplied by (B) the excess, if any, of (I) the Acquisition Price over (II) the exercise,
measurement or purchase price of such Award and any applicable tax withholdings, in exchange for the termination of such Award,
provided, that if the Acquisition Price per share (as determined by the Board) does not exceed the exercise price of such Award,
then the Award shall be canceled without any payment of consideration therefor;


 


(v) provide
that, in connection with a liquidation or dissolution of the Company, Awards shall convert into the right to receive liquidation
proceeds (if applicable, net of the exercise, measurement or purchase price thereof and any applicable tax withholdings); and



 


(vi)
any combination of the foregoing. 


 


In
taking any of the actions permitted under this Section 14.2, the Board shall not be obligated by the Plan to treat all Awards,
all Awards held by a Participant, or all Awards of the same type, identically.


 






     22


     


    

 


15.        
Effect of Change in Control.


 


15.1
(i) Notwithstanding any other provision of the Plan, in the event of a Change in Control, unless the Administrator elects to (i) terminate
an Award in exchange for cash, rights or property, or (ii) cause an Award to become fully exercisable and no longer subject
to any forfeiture restrictions prior to the consummation of a Change in Control, (A) such Award (other than any portion subject
to performance-based vesting) shall continue in effect or be assumed or an equivalent Award substituted by the successor corporation
or a parent or subsidiary of the successor corporation and (B) the portion of such Award subject to performance-based vesting
shall be subject to the terms and conditions of the applicable Award Agreement and, in the absence of applicable terms and conditions,
the Administrator’s discretion.


 


(ii)
In the event that the successor corporation in a Change in Control refuses to assume or substitute for an Award (other than any
portion subject to performance-based vesting), the Administrator shall cause such Award to become fully vested and, if applicable,
exercisable immediately prior to the consummation of such transaction and all forfeiture restrictions on such Award to lapse and,
to the extent unexercised upon the consummation of such transaction, to terminate in exchange for cash, rights or other property.
The Administrator shall notify the Participant of any Award that becomes exercisable pursuant to the preceding sentence that such
Award shall be fully exercisable for a period of 15 days from the date of such notice, contingent upon the occurrence of the Change
in Control, or that such Award shall be settled for an amount of cash or securities equal to the in-the-money spread
value (if any) of such Award, and such Award shall terminate upon the consummation of the Change in Control in accordance with
the preceding sentence.


 


(iii)
For the purposes of this Section 15, an Award shall be considered assumed if, following the Change in Control, the Award confers
the right to purchase or receive, for each Share subject to the Award immediately prior to the Change in Control, the consideration
(whether stock, cash, or other securities or property) received in the Change in Control by holders of Common Stock for each Share
held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration
chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the
Change in Control was not solely common stock of the successor corporation or its parent, the Administrator may, with the consent
of the successor corporation, provide for the consideration to be received upon the exercise of the Award, for each Share subject
to an Award, to be solely common stock of the successor corporation or its parent equal in fair market value to the per-share consideration
received by holders of Common Stock in the Change in Control. 


(iv)
Notwithstanding anything to the contrary herein, if a Participant experiences a Termination of Service during the period beginning
three months prior to and ending 12 months following the closing of a Change in Control that is effected by the Company without
Cause or by the Participant for Good Reason, then, the Award(s) held by such Participant shall become fully vested and, if applicable,
exercisable and all forfeiture restrictions on such Award(s) shall lapse as of immediately prior to the consummation of such Change
in Control or, if later, the date of such Termination of Service.


 






     23


     


    

 


15.1         
In addition, in the event of a Change in Control, the Committee may in its discretion cancel any outstanding Awards and pay to
the holders thereof, in cash or stock, or any combination thereof, the value of such Awards based upon the price per share of
Common Stock received or to be received by other shareholders of the Company in the event. In the case of any Option or Stock
Appreciation Right with an exercise price (or SAR Exercise Price in the case of a Stock Appreciation Right) that equals or exceeds
the price paid for a share of Common Stock in connection with the Change in Control, the Committee may cancel the Option or Stock
Appreciation Right without the payment of consideration therefor.


 


15.2         
The obligations of the Company under the Plan shall be binding upon any successor corporation or organization resulting from the
merger, consolidation or other reorganization of the Company, or upon any successor corporation or organization succeeding to
all or substantially all of the assets and business of the Company and its Affiliates, taken as a whole.


 


16.      
Amendment of the Plan and Awards.


 


16.1         
Amendment of Plan. The Board at any time,
and from time to time, may amend or terminate the Plan. However, except as provided in Section 14
relating to adjustments upon changes in Common Stock and Section 16.3, no
amendment shall be effective unless approved by the shareholders of the Company to the extent shareholder approval is necessary
to satisfy any Applicable Laws. At the time of such amendment, the Board shall determine, upon advice from counsel, whether such
amendment will be contingent on shareholder approval.


 


16.2         
Shareholder Approval. The Board may, in
its sole discretion, submit any other amendment to the Plan for shareholder approval.


 


16.3         
Contemplated Amendments. It is expressly
contemplated that the Board may amend the Plan in any respect the Board deems necessary or advisable to provide eligible Employees,
Consultants and Directors with the maximum benefits provided or to be provided under the provisions of the Code and the regulations
promulgated thereunder relating to Incentive Stock Options or to the nonqualified deferred compensation provisions of Section
409A of the Code and/or to bring the Plan and/or Awards granted under it into compliance therewith.


 


16.4         
No Impairment of Rights. Rights under
any Award granted before amendment of the Plan shall not be impaired by any amendment of the Plan unless (a) the Company requests
the consent of the Participant and (b) the Participant consents in writing.


 


16.5         
Amendment of Awards. The Committee at
any time, and from time to time, may amend the terms of any one or more Awards; provided, however, that the Committee may
not affect any amendment which would otherwise constitute an impairment of the rights under any Award unless (a) the Company requests
the consent of the Participant and (b) the Participant consents in writing.


 






     24


     


    

 


17.      
General Provisions.


 


17.1         
Forfeiture Events. The Committee may specify
in an Award Agreement that the Participant's rights, payments and benefits with respect to an Award shall be subject to reduction,
cancellation, forfeiture or recoupment upon the occurrence of certain events, in addition to applicable vesting conditions of
an Award. Such events may include, without limitation, breach of non-competition, non-solicitation, confidentiality, or other
restrictive covenants that are contained in the Award Agreement or otherwise applicable to the Participant, a termination of the
Participant's Continuous Service for Cause, or other conduct by the Participant that is detrimental to the business or reputation
of the Company and/or its Affiliates.


 


17.2         
Clawback. Notwithstanding any other provisions
in this Plan, the Company may cancel any Award, require reimbursement of any Award by a Participant, and effect any other right
of recoupment of equity or other compensation provided under the Plan in accordance with any Company policies that may be adopted
and/or modified from time to time ("Clawback Policy"). In addition, a Participant may be required to repay to
the Company previously paid compensation, whether provided pursuant to the Plan or an Award Agreement, in accordance with the
Clawback Policy. By accepting an Award, the Participant is agreeing to be bound by the Clawback Policy, as in effect or as may
be adopted and/or modified from time to time by the Company in its discretion (including, without limitation, to comply with applicable
law or stock exchange listing requirements).


 


17.3         
Other Compensation Arrangements. Nothing
contained in this Plan shall prevent the Board from adopting other or additional compensation arrangements, subject to shareholder
approval if such approval is required; and such arrangements may be either generally applicable or applicable only in specific
cases.


 


17.4         
Sub-Plans. The Committee may from time
to time establish sub-plans under the Plan for purposes of satisfying securities, tax or other laws of various jurisdictions in
which the Company intends to grant Awards. Any sub-plans shall contain such limitations and other terms and conditions as the
Committee determines are necessary or desirable. All sub-plans shall be deemed a part of the Plan, but each sub-plan shall apply
only to the Participants in the jurisdiction for which the sub-plan was designed.


 


17.5         
Deferral of Awards. The Committee may
establish one or more programs under the Plan to permit selected Participants the opportunity to elect to defer receipt of consideration
upon exercise of an Award, satisfaction of performance criteria, or other event that absent the election would entitle the Participant
to payment or receipt of shares of Common Stock or other consideration under an Award. The Committee may establish the election
procedures, the timing of such elections, the mechanisms for payments of, and accrual of interest or other earnings, if any, on
amounts, shares or other consideration so deferred, and such other terms, conditions, rules and procedures that the Committee
deems advisable for the administration of any such deferral program.


 






     25


     


    

 


17.6         
Unfunded Plan. The Plan shall be unfunded.
Neither the Company, the Board nor the Committee shall be required to establish any special or separate fund or to segregate any
assets to assure the performance of its obligations under the Plan.


 


17.7         
Recapitalizations. Each Award Agreement
shall contain provisions required to reflect the provisions of Section 14.


 


17.8         
Delivery. Upon exercise of a right granted
under this Plan, the Company shall issue Common Stock or pay any amounts due within a reasonable period of time thereafter.


 


17.9         
No Fractional Shares. No fractional shares
of Common Stock shall be issued or delivered pursuant to the Plan. The Committee shall determine whether cash, additional Awards
or other securities or property shall be issued or paid in lieu of fractional shares of Common Stock or whether any fractional
shares should be rounded, forfeited or otherwise eliminated.


 


17.10  
     Other Provisions.
The Award Agreements authorized under the Plan may contain such other provisions not inconsistent with this Plan,
including, without limitation, restrictions upon the exercise of Awards, as the Committee may deem advisable.


 


17.11  
     Section 409A.
The Plan is intended to comply with Section 409A of the Code to the extent subject thereto, and, accordingly, to the
maximum extent permitted, the Plan shall be interpreted and administered to be in compliance therewith. Any payments
described in the Plan that are due within the "short-term deferral period" as defined in Section 409A of the Code
shall not be treated as deferred compensation unless Applicable Laws require otherwise. Notwithstanding anything to the
contrary in the Plan, to the extent required to avoid accelerated taxation and tax penalties under Section 409A of the Code,
amounts that would otherwise be payable and benefits that would otherwise be provided pursuant to the Plan during the six (6)
month period immediately following the Participant's termination of Continuous Service shall instead be paid on the first
payroll date after the six-month anniversary of the Participant's separation from service (or the Participant's death, if
earlier). Notwithstanding the foregoing, neither the Company nor the Committee shall have any obligation to take any action
to prevent the assessment of any additional tax or penalty on any Participant under Section 409A of the Code and neither the
Company nor the Committee will have any liability to any Participant for such tax or penalty.


 


17.12 
      Disqualifying Dispositions.
Any Participant who shall make a "disposition" (as defined in Section 424 of the Code) of all or any portion
of shares of Common Stock acquired upon exercise of an Incentive Stock Option within two years from the Grant Date of
such Incentive Stock Option or within one year after the issuance of the shares of Common Stock acquired upon exercise of
such Incentive Stock Option (a "Disqualifying Disposition") shall, if requested by the Company, be required
to immediately advise the Company in writing as to the occurrence of the sale and the price realized upon the sale of
such shares of Common Stock.


 


17.13   
    Section 16. It is the
intent of the Company that the Plan satisfy, and be interpreted in a manner that satisfies, the applicable requirements of
Rule 16b-3 as promulgated under Section 16 of the Exchange Act so that Participants will be entitled to the benefit of Rule
16b-3, or any other rule promulgated under Section 16 of the Exchange Act, and will not be subject to short-swing liability
under Section 16 of the Exchange Act. Accordingly, if the operation of any provision of the Plan would conflict with the
intent expressed in this Section 17.13, such provision to the extent possible shall be interpreted and/or deemed amended so
as to avoid such conflict.


 






     26


     


    

 


17.14   
    Beneficiary Designation.
Each Participant under the Plan may from time to time name any beneficiary or beneficiaries by whom any right under the
Plan is to be exercised in case of such Participant's death. Each designation will revoke all prior designations by the
same Participant, shall be in a form reasonably prescribed by the Committee and shall be effective only when filed by
the Participant in writing with the Company during the Participant's lifetime.


 


17.15   
    Expenses. The costs of
administering the Plan shall be paid by the Company.


 


17.16       
Severability. If any of the provisions
of the Plan or any Award Agreement is held to be invalid, illegal or unenforceable, whether in whole or in part, such provision
shall be deemed modified to the extent, but only to the extent, of such invalidity, illegality or unenforceability and the remaining
provisions shall not be affected thereby.


 


17.17       
Plan Headings. The headings in the Plan
are for purposes of convenience only and are not intended to define or limit the construction of the provisions hereof.


 


17.18       
Non-Uniform Treatment. The Committee's
determinations under the Plan need not be uniform and may be made by it selectively among persons who are eligible to receive,
or actually receive, Awards. Without limiting the generality of the foregoing, the Committee shall be entitled to make non-uniform
and selective determinations, amendments and adjustments, and to enter into non-uniform and selective Award Agreements.


 


18.      
Effective Date of Plan.
The Plan shall become effective as of the Effective Date, but no Award shall be exercised (or, in the case of a stock Award, shall
be granted) unless and until the Plan has been approved by the shareholders of the Company, which approval shall be within twelve
(12) months before or after the date the Plan is adopted by the Board.


 


19.      
Termination or Suspension of the Plan.
The Plan shall terminate automatically on _________________, 2032. No Award shall be granted pursuant to the Plan after such date,
but Awards theretofore granted may extend beyond that date. The Board may suspend or terminate the Plan at any earlier date pursuant
to Section 16.1 hereof. No Awards may be granted under the Plan while the Plan is
suspended or after it is terminated.


 


20.      
Choice of Law.
The law of the State of Delaware shall govern all questions concerning the construction, validity and interpretation of this Plan,
without regard to such state's conflict of law rules.


 


As
adopted by the Board of Directors of Alopexx, Inc. on [DATE OF IPO].


 


As
approved by the shareholders of Alopexx, Inc. on [DATE OF IPO].


 






     27


 


    




 





Incentive Stock Option Award Agreement


 


This Incentive Stock Option Agreement (this “Agreement”)
is made and entered into as of [DATE] by and between Alopexx, Inc., a Delaware corporation (the “Company”) and
[EMPLOYEE NAME] (the “Participant”).


 


Grant Date: ____________________________________


 


Exercise Price per Share: __________________________


 


Number of Option Shares: _________________________


 


Expiration Date: _________________________________


 


1.         Grant
of Option.


 


1.1       Grant;
Type of Option. The Company hereby grants to the Participant an option (the “Option”) to purchase
the total number of shares of Common Stock of the Company equal to the number of Option Shares set forth above, at the Exercise
Price set forth above. The Option is being granted pursuant to the terms of the Company’s 2022 Equity Incentive (the “Plan”).
The Option is intended to be an Incentive Stock Option within the meaning of Section 422 of the Code, although the Company makes
no representation or guarantee that the Option will qualify as an Incentive Stock Option. To the extent that the aggregate Fair
Market Value (determined on the Grant Date) of the shares of Common Stock with respect to which Incentive Stock Options are exercisable
for the first time by the Participant during any calendar year (under all plans of the Company and its Affiliates) exceeds $100,000,
the Options or portions thereof which exceed such limit (according to the order in which they were granted) shall be treated as
Non-Qualified Stock Options.


 


1.2       Consideration;
Subject to Plan. The grant of the Option is made in consideration of the services to be rendered by the Participant
to the Company and is subject to the terms and conditions of the Plan. Capitalized terms used but not defined herein will have
the meaning ascribed to them in the Plan.


 


2.         Exercise
Period; Vesting.


 


2.1       Vesting
Schedule. The Option will become vested and exercisable with respect to [NUMBER] shares on [VESTING SCHEDULE] until
the Option is 100% vested. The unvested portion of the Option will not be exercisable on or after the Participant’s termination
of Continuous Service.


 


2.2       Expiration.
The Option will expire on the Expiration Date set forth above, or earlier as provided in this Agreement or the Plan.


 


3.         Termination
of Continuous Service.


 


3.1       Termination
for Reasons Other Than Cause, Death, Disability. If the Participant’s Continuous Service is terminated for any
reason other than Cause, death or Disability, the Participant may exercise the vested portion of the Option, but only within such
period of time ending on the earlier of: (a) the date three months following the termination of the Participant’s Continuous
Service or (b) the Expiration Date. 


 






     


     


    

 





3.2       Termination
for Cause. If the Participant’s Continuous Service is terminated for Cause, the Option (whether vested or unvested)
shall immediately terminate and cease to be exercisable.



 


3.3       Termination
due to Disability. If the Participant’s Continuous Service terminates as a result of the Participant’s
Disability, the Participant may exercise the vested portion of the Option, but only within such period of time ending on the earlier
of: (a) the date 12 months following the Participant’s termination of Continuous Service or (b) the Expiration Date.


 


3.4       Termination
due to Death. If the Participant’s Continuous Service terminates as a result of the Participant’s death,
the vested portion of the Option may be exercised by the Participant’s estate, by a person who acquired the right to exercise
the Option by bequest or inheritance or by the person designated to exercise the Option upon the Participant’s death, but
only within the time period ending on the earlier of: (a) the date 12 months following the Participant’s termination of
Continuous Service or (b) the Expiration Date.


 


4.         Manner
of Exercise.


 


4.1       Election
to Exercise. To exercise the Option, the Participant (or in the case of exercise after the Participant’s death
or incapacity, the Participant’s executor, administrator, heir or legatee, as the case may be) must deliver to the Company
an executed stock option exercise agreement in such form as is approved by the Committee from time to time (the “Exercise
Agreement”), which shall set forth, inter alia:


 


(a)       the
Participant’s election to exercise the Option;


 


(b)       the
number of shares of Common Stock being purchased;


 


(c)       any
restrictions imposed on the shares; and


 


(d)       any
representations, warranties and agreements regarding the Participant’s investment intent and access to information as may
be required by the Company to comply with applicable securities laws.


 


If someone other than the Participant
exercises the Option, then such person must submit documentation reasonably acceptable to the Company verifying that such person
has the legal right to exercise the Option.


 


4.2       Payment
of Exercise Price. The entire Exercise Price of the Option shall be payable in full at the time of exercise to the extent
permitted by applicable statutes and regulations, either:


 


(a)       in
cash or by certified or bank check at the time the Option is exercised;


 






    2


     


    

 


(b)       by
delivery to the Company of other shares of Common Stock, duly endorsed for transfer to the Company, with a Fair Market Value on
the date of delivery equal to the Exercise Price (or portion thereof) due for the number of shares being acquired, or by means
of attestation whereby the Participant identifies for delivery specific shares that have a Fair Market Value on the date of attestation
equal to the Exercise Price (or portion thereof) and receives a number of shares equal to the difference between the number of
shares thereby purchased and the number of identified attestation shares (a “Stock for Stock Exchange”);


 


(c)       through
a “cashless exercise program” established with a broker;


 


(d)       by
reduction in the number of shares otherwise deliverable upon exercise of such Option with a Fair Market Value equal to the aggregate
Exercise Price at the time of exercise;


 


(e)       by
any combination of the foregoing methods; or


 


(f)       in
any other form of legal consideration that may be acceptable to the Committee.


 


4.3       Withholding.
If the Company, in its discretion, determines that it is obligated to withhold any tax in connection with the exercise of the
Option, the Participant must make arrangements satisfactory to the Company to pay or provide for any applicable federal, state
and local withholding obligations of the Company. The Participant may satisfy any federal, state or local tax withholding obligation
relating to the exercise of the Option by any of the following means:


 


(a)       tendering
a cash payment;


 


(b)       authorizing
the Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable to the Participant as a result
of the exercise of the Option; provided, however, that no shares of Common Stock are withheld with a value exceeding the maximum
amount of tax required to be withheld by law; or


 


(c)       delivering
to the Company previously owned and unencumbered shares of Common Stock.


 


The Company has the right to withhold
from any compensation paid to a Participant.


 


4.4       Issuance
of Shares. Provided that the [exercise notice/Exercise Agreement] and payment are in form and substance satisfactory
to the Company, the Company shall issue the shares of Common Stock registered in the name of the Participant, the Participant’s
authorized assignee, or the Participant’s legal representative which shall be evidenced by stock certificates representing
the shares with the appropriate legends affixed thereto, appropriate entry on the books of the Company or of a duly authorized
transfer agent, or other appropriate means as determined by the Company.


 






    3


     


    

 


5.         No
Right to Continued Employment; No Rights as Shareholder. Neither the Plan nor this Agreement shall confer upon
the Participant any right to be retained in any position, as an Employee, Consultant or Director of the Company. Further, nothing
in the Plan or this Agreement shall be construed to limit the discretion of the Company to terminate the Participant’s Continuous
Service at any time, with or without Cause. The Participant shall not have any rights as a shareholder with respect to any shares
of Common Stock subject to the Option unless and until certificates representing the shares have been issued by the Company to
the holder of such shares, or the shares have otherwise been recorded on the books of the Company or of a duly authorized transfer
agent as owned by such holder.


 


6.         Transferability.
The Option is not transferable by the Participant other than to a designated beneficiary upon the Participant’s death or
by will or the laws of descent and distribution, and is exercisable during the Participant’s lifetime only by him or her.
No assignment or transfer of the Option, or the rights represented thereby, whether voluntary or involuntary, by operation of
law or otherwise (except to a designated beneficiary, upon death, by will or the laws of descent or distribution) will vest in
the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the Option
will terminate and become of no further effect.


 


7.         Change
in Control.


 


7.1       Acceleration
of Vesting. In the event of a Change in Control, the Committee shall determine the effect on the Option in accordance
with the terms of the Plan.


 


7.2       Cash-out.
In the event of a Change in Control, the Committee may, in its discretion and upon at least ten (10) days’ advance notice
to the Participant, cancel the Option and pay to the Participant the value of the Option based upon the price per share of Common
Stock received or to be received by other shareholders of the Company in the event. Notwithstanding the foregoing, if at the time
of a Change in Control the Exercise Price of the Option equals or exceeds the price paid for a share of Common Stock in connection
with the Change in Control, the Committee may cancel the Option without the payment of consideration therefor.


 


8.         Adjustments.
The shares of Common Stock subject to the Option may be adjusted or terminated in any manner as contemplated by the Plan.


 


9.         Tax
Liability and Withholding. Notwithstanding any action the Company takes with respect to any or all income tax,
social insurance, payroll tax, or other tax-related withholding (“Tax-Related Items”), the ultimate liability
for all Tax-Related Items is and remains the Participant’s responsibility and the Company (a) makes no representation or
undertakings regarding the treatment of any Tax-Related Items in connection with the grant, vesting, or exercise of the Option
or the subsequent sale of any shares acquired on exercise; and (b) does not commit to structure the Option to reduce or eliminate
the Participant’s liability for Tax-Related Items.


 


10.       Qualification
as an Incentive Stock Option. It is understood that this Option is intended to qualify as an incentive stock
option as defined in Section 422 of the Code to the extent permitted under Applicable Law. Accordingly, the Participant understands
that in order to obtain the benefits of an incentive stock option, no sale or other disposition may be made of shares for which
incentive stock option treatment is desired within one (1) year following the date of exercise of the Option or within two (2)
years from the Grant Date. The Participant understands and agrees that the Company shall not be liable or responsible for any
additional tax liability the Participant incurs in the event that the Internal Revenue Service for any reason determines that
this Option does not qualify as an incentive stock option within the meaning of the Code.


 






    4


     


    

 


11.       Disqualifying
Disposition. If the Participant disposes of the shares of Common Stock prior to the expiration of either two
(2) years from the Grant Date or one (1) year from the date the shares are transferred to the Participant pursuant to the exercise
of the Option (a “Disqualifying Disposition”), the Participant shall notify the Company in writing within thirty
(30) days after such disposition of the date and terms of such disposition. The Participant also agrees to provide the Company
with any information concerning any such dispositions as the Company requires for tax purposes.


 


12.       Compliance
with Law. The exercise of the Option and the issuance and transfer of shares of Common Stock shall be subject
to compliance by the Company and the Participant with all applicable requirements of federal and state securities laws and with
all applicable requirements of any stock exchange on which the Company’s shares of Common Stock may be listed. No shares
of Common Stock shall be issued pursuant to this Option unless and until any then applicable requirements of state or federal
laws and regulatory agencies have been fully complied with to the satisfaction of the Company and its counsel. The Participant
understands that the Company is under no obligation to register the shares with the Securities and Exchange Commission, any state
securities commission or any stock exchange to effect such compliance.


 


13.       Notices.
Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the CEO of the Company
at the Company’s principal corporate offices. Any notice required to be delivered to the Participant under this Agreement
shall be in writing and addressed to the Participant at the Participant’s address as shown in the records of the Company.
Either party may designate another address in writing (or by such other method approved by the Company) from time to time.


 


14.       Governing
Law. This Agreement will be construed and interpreted in accordance with the laws of the State of Delaware without
regard to conflict of law principles.


 


15.       Interpretation.
Any dispute regarding the interpretation of this Agreement shall be submitted by the Participant or the Company to the Committee
for review. The resolution of such dispute by the Committee shall be final and binding on the Participant and the Company.


 


16.       Options
Subject to Plan. This Agreement is subject to the Plan as approved by the Company’s shareholders. The
terms and provisions of the Plan as it may be amended from time to time are hereby incorporated herein by reference. In the event
of a conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions
of the Plan will govern and prevail.


 






    5


     


    

 


17.       Successors
and Assigns. The Company may assign any of its rights under this Agreement. This Agreement will be binding upon
and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein,
this Agreement will be binding upon the Participant and the Participant’s beneficiaries, executors, administrators and the
person(s) to whom this Agreement may be transferred by will or the laws of descent or distribution.


 


18.       Severability.
The invalidity or unenforceability of any provision of the Plan or this Agreement shall not affect the validity or enforceability
of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement shall be severable and
enforceable to the extent permitted by law.


 


19.       Discretionary
Nature of Plan. The Plan is discretionary and may be amended, cancelled or terminated by the Company at any
time, in its discretion. The grant of the Option in this Agreement does not create any contractual right or other right to receive
any Options or other Awards in the future. Future Awards, if any, will be at the sole discretion of the Company. Any amendment,
modification, or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Participant’s
employment with the Company.


 


20.       Amendment.
The Committee has the right to amend, alter, suspend, discontinue or cancel the Option, prospectively or retroactively; provided,
that, no such amendment shall adversely affect the Participant’s material rights under this Agreement without the Participant’s
consent.


 


21.       No
Impact on Other Benefits. The value of the Participant’s Option is not part of his or her normal or expected
compensation for purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit.


 


22.       Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute
one and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic
mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial
appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.


 


23.       Acceptance.
The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement. The Participant has read and understands
the terms and provisions thereof, and accepts the Option subject to all of the terms and conditions of the Plan and this Agreement.
The Participant acknowledges that there may be adverse tax consequences upon exercise of the Option or disposition of the underlying
shares and that the Participant should consult a tax advisor prior to such exercise or disposition.


 


[signature page
follows]


 






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


 


	 	ALOPEXX, INC.	 
	 	 	 	 
	 	By	                        	 
	 	Name:	 
	 	Title:	 
	 	 	 	 
	 	[EMPLOYEE NAME]	 
	 	 	 	 
	 	By	 	 
	 	Name:	 




 






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