EX-10.3



 Exhibit 10.3 

FULGENT THERAPEUTICS LLC 

AMENDED AND RESTATED 

2015 EQUITY INCENTIVE PLAN 

NOTICE OF OPTION GRANT 

You have been granted an option to purchase Shares of the Company, subject to the terms and conditions of this Notice of Option Grant (the
“Notice”), the Fulgent Therapeutics LLC Amended and Restated 2015 Equity Incentive Plan, as amended from time to time (the “Plan”), and the attached Option Agreement as follows. Unless otherwise defined herein, the
terms defined in the Plan, the LLC Agreement and the Option Agreement shall have the same defined meanings in this Notice. 
  

			
	Name of Participant:	  	[●]
		
	Date of Award:	  	[●]
		
	Class of Shares:	  	Class D Non-Voting Common
		
	Exercise Price per Share:	  	$[●]
		
	Total Number of Shares	  	
	Subject to the Option:	  	[●]
		
	Total Exercise Price:	  	$[●]
		
	Type of Option:	  	Non-Qualified Option
		
	Expiration Date:	  	[●]
		
	Post-Termination Exercise Period:	  	90 days
		
	Vesting Schedule:	  	The Option shall vest with respect to 1/4 of the Shares subject thereto on the twelve-month anniversary of the Vesting Commencement Date and with respect to 1/16 of the Shares subject thereto at the end of every three-month period
thereafter. Notwithstanding such Vesting Schedule, the Option shall not be exercisable until the earlier of a Liquidity Event with respect to such Option or an Incorporation.
		
	Vesting Commencement Date:	  	[●]

 By your signature and the signature of the Company’s representative on the Option Agreement, you and the
Company agree that the Option is granted under and governed by the terms and conditions of this Notice and the Plan, the Option Agreement and the LLC Agreement, each of which are attached to and made a part of this document. 







 THE OPTION GRANTED PURSUANT TO THIS AGREEMENT, AND THE SHARES FOR WHICH SUCH OPTION IS EXERCISABLE, HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH
REGISTRATION IS NOT REQUIRED. THE PARTICIPANT HEREBY AGREES THAT ALL SHARES ACQUIRED PURSUANT TO THIS AGREEMENT SHALL BE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AS SET FORTH IN THE LLC AGREEMENT. 

FULGENT THERAPEUTICS LLC 

AMENDED AND RESTATED 

2015 EQUITY INCENTIVE PLAN: 

OPTION AGREEMENT 

THIS OPTION AGREEMENT (the “Agreement”) is entered into as of [●], by
Fulgent Therapeutics LLC, a California limited liability company (the “Company”), and [●] (the “Participant”). 
  

	SECTION 1.	GRANT OF OPTION. 

 The Company hereby grants to the Participant named in the Notice of
Option Grant (the “Notice”) an option (the “Option”) to purchase the total number and type of Shares subject to the Option (the “Optioned Shares”) set forth in the Notice, at the exercise price per
Share set forth in the Notice (the “Exercise Price”) subject to the terms and provisions of the Notice, this Agreement, the Company’s Amended and Restated 2015 Equity Incentive Plan, as amended from time to time (the
“Plan”), and the LLC Agreement, which are incorporated herein by reference. Unless otherwise defined herein, the terms defined in the Plan and the LLC Agreement shall have the same defined meanings in this Agreement. 

 

	SECTION 2.	EXERCISE OF OPTION. 

 (a) Right to Exercise. The Option shall vest during its term
in accordance with the Vesting Schedule set out in the Notice and with the applicable provisions of the Plan and this Agreement, provided that the Option shall not be exercisable, to the extent vested, until the earlier of a Liquidity Event with
respect to such Option or an Incorporation unless otherwise determined by the Manager in its discretion. The Option shall be subject to the provisions of the Notice and the Plan relating to the exercisability or termination of the Option in the
event of a Liquidity Event with respect to such Option. The Participant shall be subject to reasonable limitations on the number of requested exercises during any monthly or weekly period as determined by the Manager. In no event shall the Company
issue fractional Shares. 
 (b) Method of Exercise. The Option shall be exercisable by delivery of an exercise notice in a form
determined by the Manager from time to time or by such other procedure as specified from time to time by the Manager, which shall state the election to 







 
exercise the Option, the whole number of Shares in respect of which the Option is being exercised, and such other provisions as may be required by the Manager. The exercise notice shall be
delivered in person, by certified mail, or by such other method (including electronic transmission) as determined from time to time by the Manager to the Company accompanied by payment of the Exercise Price and all applicable income and employment
taxes required to be withheld. 
 (c) Taxes. No Shares will be delivered to the Participant pursuant to the exercise of the Option
until the Participant has made arrangements acceptable to the Manager for the satisfaction of applicable income tax and employment tax withholding obligations and such other tax obligations of the Participant as may be incident to the receipt of
Shares. Upon exercise of the Option, the Company or the Participant’s employer may offset or withhold (from any amount owed by the Company or the Participant’s employer to the Participant) or collect from the Participant an amount
sufficient to satisfy such tax withholding obligations. Furthermore, in the event of any determination that the Company has failed to withhold a sum sufficient to pay all withholding taxes due in connection with the Option, the Participant agrees to
pay the Company the amount of such deficiency in cash within five (5) days after receiving a written demand from the Company to do so, whether or not the Participant is an employee of the Company at that time. 

 

	SECTION 3.	CONDITIONS TO EXERCISE AND ISSUANCE OF SHARES. 

 The Participant understands that neither
the Option nor the Shares exercisable pursuant to the Option have been registered under the Securities Act or any other securities laws and are subject to the LLC Agreement. As a condition to exercise of the Option, the Participant shall make such
representations and warranties as are required by Section 8(b) of the Plan and take such other actions as the Manager requests in its reasonable discretion as a condition to the issuance of Shares to the Participant and the admission of such
Participant as a Member of the Company. 
  

	SECTION 4.	METHOD OF PAYMENT. 

 Payment of the Exercise Price shall be made by any of the following,
or a combination thereof, at the election of the Participant; provided, however, that such exercise method does not then violate any applicable law: by cash, check or wire transfer. 

 

	SECTION 5.	RESTRICTIONS ON EXERCISE. 

 (a) The Option may not be exercised if the issuance of the
Shares subject to the Option upon such exercise would constitute a violation of any applicable laws. If the exercise of the Option within the applicable time periods set forth in Sections 6, 7 and 8 of this Agreement is prevented by the
provisions of this Section 5(a), the Option shall remain exercisable until one (1) month after the date the Participant is notified by the Company that the Option is exercisable, but in any event no later than the expiration date set forth
in the Notice (the “Expiration Date”). 
 (b) Notwithstanding any provision herein to the contrary, the Option shall not be
exercisable until the earlier of a Liquidity Event with respect to such Option or an Incorporation unless otherwise determined by the Manager in its discretion. In the event the Participant’s Continuous Service is terminated prior to an
Incorporation or a Liquidity Event for any reason, including, but not limited to, voluntary resignation, termination without Cause, death or Disability, and unless otherwise determined by the Manager, there shall be no Post-Termination Exercise
Period and the Option (including the vested portions of the Option) shall terminate concurrently with the termination of the Participant’s Continuous Service. 








	SECTION 6.	TERMINATION OR CHANGE OF CONTINUOUS SERVICE. 

 (a) Subject to Section 5, in the
event the Participant’s Continuous Service terminates, other than for Cause, the Participant may, but only during the Post-Termination Exercise Period set forth in the Notice, exercise the portion of the Option that was vested at the date of
such termination (the “Termination Date”) to the extent such portion is not forfeited in accordance with the terms of the Notice. The Post-Termination Exercise Period shall commence on the Termination Date. In the event of
termination of the Participant’s Continuous Service for Cause, the Participant’s right to exercise the Option shall, except as otherwise determined by the Manager, terminate concurrently with the termination of the Participant’s
Continuous Service (also the “Termination Date”). In no event, however, shall the Option be exercised later than the Expiration Date set forth in the Notice. In the event of the Participant’s change in status from Employee to
Consultant or from Consultant to Employee, the Option shall remain in effect and the Option shall continue to vest in accordance with the Vesting Schedule set forth in the Notice. To the extent that the Option was unvested on the Termination Date,
or if the Participant does not exercise the vested portion of the Option within the Post-Termination Exercise Period, the Option shall terminate. 

(b) If the Participant commences working on a part-time basis, then the Manager may adjust the Vesting Schedule set forth in the Notice in
accordance with the Company’s part-time work policy or the terms of an agreement between the Participant and the Company pertaining to his or her part-time schedule. If the Participant goes on a leave of absence, then the Company may adjust the
Vesting Schedule set forth in the Notice in accordance with the Company’s leave of absence policy or the terms of such leave. 
  

	SECTION 7.	DISABILITY OF PARTICIPANT. 

 Subject to Section 5, in the event the
Participant’s Continuous Service terminates as a result of his or her Disability, the Participant may, but only within twelve (12) months from the Termination Date and in no event later than the Expiration Date, exercise the portion of the
Option that was vested on the Termination Date to the extent such portion is not forfeited in accordance with the terms of the Notice. To the extent that the Option was unvested on the Termination Date, or if the Participant does not exercise the
vested portion of the Option within the time specified herein, the Option shall terminate. For purposes of this Agreement, “Disability” shall have the same meaning as defined under the long-term disability policy of the Company or
the Related Entity to which the Participant provides services regardless of whether the Participant is covered by such policy. If the Company or the Related Entity to which the 







 
Participant provides service does not have a long-term disability plan in place, “Disability” means that the Participant is unable to carry out the responsibilities and functions
of the position held by the Participant by reason of any medically determinable physical or mental impairment for a period of not less than ninety (90) consecutive days. The Participant will not be considered to have incurred a Disability
unless he or she furnishes proof of such impairment sufficient to satisfy the Manager in its discretion. 
  

	SECTION 8.	DEATH OF PARTICIPANT. 

 Subject to Section 5, in the event of the termination of the
Participant’s Continuous Service as a result of his or her death, or in the event of the Participant’s death during the Post-Termination Exercise Period or during the twelve (12) month period following the Participant’s
termination of Continuous Service as a result of his or her Disability, the person who acquired the right to exercise the Option pursuant to Section 9 may, within twelve (12) months following the date of the Participant’s death but in
no event later than the Expiration Date, exercise the portion of the Option that was vested on the Termination Date to the extent such portion is not forfeited in accordance with the terms of the Notice. To the extent that the Option was unvested on
the date of death, or if the vested portion of the Option is not exercised within the time specified herein, the Option shall terminate. 
  

	SECTION 9.	TRANSFERABILITY OF OPTION. 

 The Option may not be transferred in any manner other than
by will or by the laws of descent and distribution; provided, however, that the Option may be transferred during the lifetime of the Participant to the extent and in the manner determined by the Manager in its sole discretion.
Notwithstanding the foregoing, the Participant may designate one or more beneficiaries of the Participant’s Option in the event of the Participant’s death on a beneficiary designation form provided by the Manager. Following the death of
the Participant, the Option, to the extent provided in Section 8, may be exercised (a) by the person or persons designated under the deceased Participant’s beneficiary designation, or (b) in the absence of an effectively
designated beneficiary, by the Participant’s legal representative or by any person empowered to do so under the deceased Participant’s will or under the then applicable laws of descent and distribution. The terms of the Option shall be
binding upon the executors, administrators, heirs, successors and transferees of the Participant. 
  

	SECTION 10.	TERM OF OPTION. 

 The Option must be exercised no later than the Expiration Date or such
earlier date as otherwise provided herein. After the Expiration Date or such earlier date, the Option shall be of no further force or effect and may not be exercised. 
  

	SECTION 11.	RESTRICTION ON TRANSFER OF SHARES. 

 (a) General. The Participant shall not
transfer, assign, encumber or otherwise dispose of any Shares issued hereunder without the Manager’s written consent, which may be granted or withheld in its sole discretion. 







 (b) LLC Agreement. Shares issued hereunder shall be subject to the transfer provisions of
the LLC Agreement. 
 (c) Market Stand-Off. In connection with any underwritten public offering by the Company or the Company’s
successor in an acquisition or otherwise (collectively, the “Successor Entity”) of its equity securities pursuant to an effective registration statement filed under the Securities Act, including the Successor Entity’s initial
public offering, the Participant or any holder of the Shares acquired under this Agreement shall not directly or indirectly sell, make any short sale of, loan, hypothecate, pledge, offer, grant or sell any option or other contract for the purchase
of, purchase any option or other contract for the sale of, or otherwise dispose of or transfer, or agree to engage in any of the foregoing transactions with respect to, any Shares acquired under this Agreement (or other equity securities of the
Successor Entity) without the prior written consent of the Successor Entity or its underwriters. Such restriction (the “Market Stand-Off”) shall be in effect for such period of time following the date of the final prospectus for the
offering as may be requested by the Successor Entity or such underwriters. In no event, however, shall such period exceed 180 days. The Market Stand-Off shall in any event terminate two years after the date of the Successor Entity’s initial
public offering. In the event of the declaration of a stock dividend, a spin-off, a stock split, an adjustment in conversion ratio, a recapitalization or a similar transaction affecting the Successor
Entity’s outstanding securities without receipt of consideration, any new, substituted or additional securities which are by reason of such transaction distributed with respect to any Shares subject to the Market Stand-Off, or into which such
Shares thereby become convertible, shall immediately be subject to the Market Stand-Off. In order to enforce the Market Stand-Off, the Successor Entity may impose stop-transfer instructions with respect to the Shares acquired under this Agreement
until the end of the applicable stand-off period. The Successor Entity’s underwriters shall be beneficiaries of the agreement set forth in this Subsection (c). This Subsection (c) shall not apply to Shares registered in the public
offering under the Securities Act, and the Participant shall be subject to this Subsection (c) only if the directors and officers of the Successor Entity are subject to similar arrangements. 

(d) Securities Law Restrictions. Regardless of whether the issuance of Shares hereunder have been registered under the Securities Act
or have been registered or qualified under the securities laws of any state, the Company at its discretion may impose restrictions upon the sale, pledge or other transfer of the Shares (including the placement of appropriate legends on Share
certificates or the imposition of stop-transfer instructions) if, in the judgment of the Company, such restrictions are necessary or desirable in order to achieve compliance with the Securities Act, the
securities laws of any state or any other law. 
 (e) Rights of the Company. The Company shall not be required to (i) transfer
on its books any Shares that have been sold or transferred in contravention of this Agreement or the LLC Agreement or (ii) treat as a Member of the Company or as the owner of Shares, or otherwise to accord voting, distribution or liquidation
rights to, any transferee to whom Shares have been transferred in contravention of this Agreement or the LLC Agreement. 
 (f)
Administration. Any determination by the Company and its counsel in connection with any of the matters set forth in this Section 11 shall be conclusive and binding on the Participant and all other persons. 








	SECTION 12.	COMPANY’S REPURCHASE RIGHT. 

 (a) Grant of Repurchase Right. The
Company is hereby granted the right (the “Repurchase Right”), exercisable at any time (i) during the nine (9) month period following the Termination Date, or (ii) during the nine (9) month period following an
exercise of the Option that occurs after the Termination Date, to repurchase all or any portion of any Shares issued hereunder (the “Share Repurchase Period”). The Company shall be entitled to exercise such Repurchase Right
regardless of the reason for termination of the Participant’s Continuous Service, whether such termination occurs for Cause, for Good Reason, without Cause or as a result of the death or Disability of the Participant. 

(b) Exercise of the Repurchase Right. The Repurchase Right shall be exercisable by written notice delivered to each holder of the
Shares prior to the expiration of the Share Repurchase Period. The notice shall indicate the number of Shares to be repurchased and the date on which the repurchase is to be effected, such date to be not later than the last day of the Share
Repurchase Period. On the date on which the repurchase is to be effected, the Company and/or its assigns shall pay to the holder in cash or cash equivalents (including the cancellation of any purchase-money indebtedness) an amount equal to the
Repurchase Price on the date on which the repurchase is to be effected of the Shares which are to be repurchased from the holder. Upon such payment or deposit into escrow for the benefit of the holder, the Company and/or its assigns shall become the
legal and beneficial owner of the Shares being repurchased and all rights and interest thereon or related thereto, and the Company shall have the right to transfer to its own name or its assigns the number of Shares being repurchased, without
further action by the holder. 
 (c) Assignment. Whenever the Company shall have the right to purchase Shares under this
Repurchase Right, the Company may designate and assign one or more Employees, Officers or Members of the Company or other persons or organizations, to exercise all or a part of the Company’s Repurchase Right.  

(d) Termination of the Repurchase Right. The Repurchase Right shall terminate with respect to any Shares for which it is not
timely exercised and upon the effective date of a registration statement of the Company filed under the Securities Act of 1933, as amended (“IPO”).  

(e) Additional Shares or Substituted Securities. In the event of an Incorporation or any Liquidity Event, any new, substituted
or additional securities or other property which is by reason of any such transaction distributed with respect to the Shares shall be immediately subject to the Repurchase Right, but only to the extent the Shares are at the time covered by such
right. The Repurchase Price for such securities shall be appropriately adjusted to take into account the terms of such Incorporation or Liquidity Event as determined by the Manager in its reasonable discretion. 







 (f) Repurchase Price. For purposes of this Agreement, the “Repurchase
Price” with respect to a Share shall be: 
 (i) In the case of a termination of Continuous Service for Cause, $0. 

(ii) In the case of a termination of Continuous Service without Cause, the greater of (i) the amount paid by the Participant (or the
Participant’s successor) to acquire such Share and (ii) the Book Value Attributable to such Share. For this purpose, “Book Value” shall mean the aggregate cost basis of the assets of the Company (as adjusted for
depreciation and amortization) less the Company’s liabilities as reflected in the Company’s books and records, and the “Book Value Attributable to a Share” shall mean a Share’s proportionate interest in the Book Value
of the Company under the LLC Agreement, taking into account the distribution provisions thereunder and any applicable Profits Interest Threshold Amounts, in each case as determined by the Manager in its reasonable discretion. 

 

	SECTION 13.	ADJUSTMENT OF OPTIONS AND SHARES. 

 In the event of any transaction described in
Section 6(a) of the Plan, the number and kind of Shares for which the Option is exercisable shall be adjusted as set forth in Section 6 of the Plan. In the event that the Company engages in a Liquidity Event as described in
Section 6(c) of the Plan, the Option shall be subject to the agreement governing such Liquidity Event and the LLC Agreement. 
  

	SECTION 14.	TAX CONSEQUENCES. 

 (a) The Participant may incur tax liability as a result of the
Participant’s purchase or disposition of the Shares. THE PARTICIPANT SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. 

(b) Notwithstanding the Company’s good faith determination of the Fair Market Value of the Shares for purposes of determining the
Exercise Price Per Share of the Option as set forth in the Notice, the taxing authorities may assert that the Fair Market Value of the Shares on the Date of Award was greater than the Exercise Price Per Share. Under Section 409A of the Code, if
the Exercise Price Per Share of the Option is less than the Fair Market Value of the Shares on the Date of Award, the Option may be treated as a form of deferred compensation and the Participant may be subject to an acceleration of income
recognition, an additional 20% tax (plus any additional state tax penalty), plus interest and possible penalties. The Company makes no representation that the Option will comply with Section 409A of the Code and makes no undertaking to prevent
Section 409A of the Code from applying to the Option or to mitigate its effects on any deferrals or payments made in respect of the Option. The Participant is encouraged to consult a tax adviser regarding the potential impact of
Section 409A of the Code. 
  

	SECTION 15.	ENTIRE AGREEMENT; GOVERNING LAW. 

 The Notice, the Plan, this Agreement and the LLC
Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety 







 
all prior undertakings and agreements of the Company and the Participant with respect to the subject matter hereof, and may not be modified adversely to the Participant’s interest except by
means of a writing signed by the Company and the Participant. Nothing in the Notice, the Plan, the LLC Agreement and this Agreement (except as expressly provided therein) is intended to confer any rights or remedies on any persons other than the
parties. The Notice, the Plan, the LLC Agreement and this Agreement are to be construed in accordance with and governed by the internal laws of the State of California without giving effect to any choice of law rule that would cause the application
of the laws of any jurisdiction other than the internal laws of the State of California to the rights and duties of the parties. Should any provision of the Notice, the Plan, the LLC Agreement or this Agreement be determined to be illegal or
unenforceable, such provision shall be enforced to the fullest extent allowed by law and the other provisions shall nevertheless remain effective and shall remain enforceable. 

 

	SECTION 16.	CONSTRUCTION. 

 The captions used in the Notice and this Agreement are inserted for
convenience and shall not be deemed a part of the Option for construction or interpretation. Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular. Use of the term
“or” is not intended to be exclusive, unless the context clearly requires otherwise. 
  

	SECTION 17.	ADMINISTRATION AND INTERPRETATION. 

 Any question or dispute regarding the administration
or interpretation of the Notice, the Plan or this Agreement shall be submitted by the Participant or by the Company to the Manager. The resolution of such question or dispute by the Manager shall be final and binding on all persons. 

 

	SECTION 18.	VENUE. 

 The Company, the Participant, and the Participant’s assignees pursuant to
Section 9 (the “Parties”) agree that any suit, action, or proceeding arising out of or relating to the Notice, the Plan or this Agreement shall be brought in the United States District Court for the District of Southern
California (or should such court lack jurisdiction to hear such action, suit or proceeding, in a California state court in the County of Los Angeles) and that the Parties shall submit to the jurisdiction of such court. The Parties irrevocably waive,
to the fullest extent permitted by law, any objection the party may have to the laying of venue for any such suit, action or proceeding brought in such court. If any one or more provisions of this Section 18 shall for any reason be held invalid
or unenforceable, it is the specific intent of the Parties that such provisions shall be modified to the minimum extent necessary to make it or its application valid and enforceable. 

 

	SECTION 19.	NOTICES. 

 Any notice required by the terms of this Agreement shall be given in writing,
which shall include electronic communications. Notice shall be addressed to the Company at its principal executive office and to the Participant at the address that he or she most recently provided to the Company. 








	SECTION 20.	LIQUIDITY EVENT. 

 In the event of a Liquidity Event, which for purposes of clarification
shall not include an IPO, and irrespective of whether the Option is Assumed or Replaced, the Option automatically shall become fully vested and exercisable immediately prior to the specified effective date of such Liquidity Event, for all of the
Shares at the time represented by the Option, provided that the Participant’s Continuous Service has not terminated prior to such date. 

REMAINDER OF PAGE INTENTIONALLY LEFT BLANK 







 IN WITNESS WHEREOF, each of the parties has executed
this Agreement, in the case of the Company by its duly authorized officer, as of the day and year first above written. 
  

							
	PARTICIPANT:	 		 	FULGENT THERAPEUTICS LLC
			
	  
	 		 	  

				
	[●]	 		 	By:	 	[●]
		 		 	Title:	 	[●]

 IN EXECUTING THIS AGREEMENT, THE PARTICIPANT ACKNOWLEDGES RECEIPT OF A COPY OF THE PLAN, THE NOTICE AND THE LLC AGREEMENT IN
ADDITION TO THIS AGREEMENT AND REPRESENTS THAT HE OR SHE IS FAMILIAR WITH THE TERMS AND PROVISIONS THEREOF, AND HEREBY ACCEPTS THE AWARD SUBJECT TO ALL OF THE TERMS AND PROVISIONS HEREOF AND THEREOF. THE PARTICIPANT HAS REVIEWED THIS AGREEMENT, THE
PLAN, THE LLC AGREEMENT AND THE NOTICE IN THEIR ENTIRETY, HAS HAD AN OPPORTUNITY TO OBTAIN THE ADVICE OF COUNSEL PRIOR TO EXECUTING THIS AGREEMENT, AND FULLY UNDERSTANDS ALL PROVISIONS OF THIS AGREEMENT, THE LLC AGREEMENT, THE NOTICE AND THE PLAN.
THE PARTICIPANT HEREBY AGREES THAT ALL QUESTIONS OF INTERPRETATION AND ADMINISTRATION RELATING TO THIS AGREEMENT, THE NOTICE, THE PLAN AND THE LLC AGREEMENT SHALL BE RESOLVED BY THE MANAGER.