Exhibit 10.2


 


AEROVATE THERAPEUTICS,
INC.


 


2021 STOCK
OPTION AND INCENTIVE PLAN


 


	SECTION 1.	 GENERAL PURPOSE OF THE PLAN; DEFINITIONS



 


The name of the plan is the Aerovate Therapeutics,
Inc. 2021 Stock Option and Incentive Plan (the “Plan”). The purpose of the Plan is to encourage and enable the officers, employees,
Non-Employee Directors and Consultants of Aerovate Therapeutics, Inc. (the “Company”) and its Affiliates upon whose judgment,
initiative and efforts the Company largely depends for the successful conduct of its business to acquire a proprietary interest in the
Company. It is anticipated that providing such persons with a direct stake in the Company’s welfare will assure a closer identification
of their interests with those of the Company and its stockholders, thereby stimulating their efforts on the Company’s behalf and
strengthening their desire to remain with the Company.


 


The following terms shall be defined as set forth
below:


 


“Act” means the Securities Act
of 1933, as amended, and the rules and regulations thereunder.


 


“Administrator” means either
the Board or the compensation committee of the Board or a similar committee performing the functions of the compensation committee and
which is comprised of not less than two Non-Employee Directors who are independent.


 


“Affiliate” means, at the time
of determination, any “parent” or “subsidiary” of the Company as such terms are defined in Rule 405 of the Act.
The Board will have the authority to determine the time or times at which “parent” or “subsidiary” status is determined
within the foregoing definition.


 


“Award” or “Awards,”
except where referring to a particular category of grant under the Plan, shall include Incentive Stock Options, Non-Qualified Stock Options,
Stock Appreciation Rights, Restricted Stock Units, Restricted Stock Awards, Unrestricted Stock Awards, Cash-Based Awards, and Dividend
Equivalent Rights.


 


“Award Certificate” means a
written or electronic document setting forth the terms and provisions applicable to an Award granted under the Plan. Each Award Certificate
is subject to the terms and conditions of the Plan.


 


“Board” means the Board of Directors
of the Company.


 


“Cash-Based Award” means an
Award entitling the recipient to receive a cash-denominated payment.


 






     


     


    




“Cause” means, unless
otherwise provided in an employment agreement between the Company and the grantee or unless otherwise defined in the Award
Certificate, a determination by the Administrator that the grantee shall be dismissed as a result of (i) any material breach by the
grantee of any agreement between the grantee and the Company; (ii) the conviction of, indictment for or plea of nolo contendere by
the grantee to a felony or a crime involving moral turpitude; or (iii) any material misconduct or willful and deliberate
non-performance (other than by reason of disability) by the grantee of the grantee’s duties to the Company.


 


“Code” means the Internal Revenue
Code of 1986, as amended, and any successor Code, and related rules, regulations and interpretations.


 


“Consultant” means a consultant
or adviser who provides bona fide services to the Company or an Affiliate as an independent contractor and who qualifies as a consultant
or advisor under Instruction A.1.(a)(1) of Form S-8 under the Act.


 


“Dividend Equivalent Right”
means an Award entitling the grantee to receive credits based on ordinary cash dividends that would have been paid on the shares of Stock
specified in the Dividend Equivalent Right (or other award to which it relates) if such shares had been issued to and held by the grantee.


 


“Effective Date” means the date
on which the Plan becomes effective as set forth in Section 19.


 


“Exchange Act” means the Securities
Exchange Act of 1934, as amended, and the rules and regulations thereunder.


 


“Fair Market Value” of the Stock
on any given date means the fair market value of the Stock determined in good faith by the Administrator; provided, however, that if the
Stock is listed on the National Association of Securities Dealers Automated Quotation System (“NASDAQ”), NASDAQ Global Market,
The New York Stock Exchange or another national securities exchange or traded on any established market, the determination shall be made
by reference to market quotations. If there are no market quotations for such date, the determination shall be made by reference to the
last date preceding such date for which there are market quotations; provided further, however, that if the date for which Fair Market
Value is determined is the Registration Date, the Fair Market Value shall be the “Price to the Public” (or equivalent) set
forth on the cover page for the final prospectus relating to the Company’s initial public offering.


 


“Good Reason” means, unless
otherwise provided in an employment agreement between the Company and the grantee or unless otherwise defined in the Award Certificate,
the occurrence of any of the following events without the grantee’s consent: (i) a material diminution in the grantee’s base
salary except for across-the-board salary reductions based on the Company’s financial performance similarly affecting all or substantially
all senior management employees of the Company or (ii) a material change in the geographic location of the principal office of the Company
to which the grantee is assigned, such that there is an increase of at least fifty (50) miles of driving distance to such location from
the grantee’s principal residence as of such change.


 


“Incentive Stock Option” means
any Stock Option designated and qualified as an “incentive stock option” as defined in Section 422 of the Code.


 






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“Non-Employee Director” means
a member of the Board who is not also an employee of the Company or any Subsidiary.


 


“Non-Qualified Stock Option”
means any Stock Option that is not an Incentive Stock Option.


 


“Option” or “Stock
Option” means any option to purchase shares of Stock granted pursuant to Section 5.


 


“Registration Date” means the
date upon which the registration statement on Form S-1 that is filed by the Company with respect to its initial public offering is declared
effective by the Securities and Exchange Commission.


 


“Restricted Shares” means the
shares of Stock underlying a Restricted Stock Award that remain subject to a risk of forfeiture or the Company’s right of repurchase.


 


“Restricted Stock Award” means
an Award of Restricted Shares subject to such restrictions and conditions as the Administrator may determine at the time of grant.


 


“Restricted Stock Units” means
an Award of stock units subject to such restrictions and conditions as the Administrator may determine at the time of grant.


 


“Sale Event” shall mean (i)
the sale of all or substantially all of the assets of the Company on a consolidated basis to an unrelated person or entity, (ii) a merger,
reorganization or consolidation pursuant to which the holders of the Company’s outstanding voting power and outstanding stock immediately
prior to such transaction do not own a majority of the outstanding voting power and outstanding stock or other equity interests of the
resulting or successor entity (or its ultimate parent, if applicable) immediately upon completion of such transaction, (iii) the sale
of all of the Stock of the Company to an unrelated person, entity or group thereof acting in concert, or (iv) any other transaction in
which the owners of the Company’s outstanding voting power immediately prior to such transaction do not own at least a majority
of the outstanding voting power of the Company or any successor entity immediately upon completion of the transaction other than as a
result of the acquisition of securities directly from the Company.


 


“Sale Price” means the value
as determined by the Administrator of the consideration payable, or otherwise to be received by stockholders, per share of Stock pursuant
to a Sale Event.


 


“Section 409A” means Section
409A of the Code and the regulations and other guidance promulgated thereunder.


 


“Service Relationship” means
any relationship as an employee, director or Consultant of the Company or any Affiliate. Unless as otherwise set forth in the Award Certificate,
a Service Relationship shall be deemed to continue without interruption in the event a grantee’s individual’s status changes
from full-time employee to part-time employee a grantee’s status changes from employee to Consultant or Non-Employee Director, or
vice versa, provided that there is no interruption or other termination of Service Relationship in connection with the grantee’s
change in capacity.


 






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“Stock” means the Common Stock,
par value $0.0001 per share, of the Company, subject to adjustments pursuant to Section 3.


 


“Stock Appreciation Right” means
an Award entitling the recipient to receive shares of Stock (or cash, to the extent explicitly provided for in the applicable Award Certificate)
having a value equal to the excess of the Fair Market Value of the Stock on the date of exercise over the exercise price of the Stock
Appreciation Right multiplied by the number of shares of Stock with respect to which the Stock Appreciation Right shall have been exercised.


 


“Subsidiary” means any corporation
or other entity (other than the Company) in which the Company has at least a 50 percent interest, either directly or indirectly.


 


“Ten Percent Owner” means an
employee who owns or is deemed to own (by reason of the attribution rules of Section 424(d) of the Code) more than 10 percent of the combined
voting power of all classes of stock of the Company or any parent or subsidiary corporation.


 


“Unrestricted Stock Award” means
an Award of shares of Stock free of any restrictions.


 


	SECTION 2.	 ADMINISTRATION OF PLAN; ADMINISTRATOR AUTHORITY TO SELECT GRANTEES AND DETERMINE AWARDS



 


(a)              
Administration of Plan. The Plan shall be administered by the Administrator.


 


(b)              
Powers of Administrator. The Administrator shall have the power and authority to grant Awards consistent with the terms
of the Plan, including the power and authority:


 


(i)             
to select the individuals to whom Awards may from time to time be granted;


 


(ii)            
to determine the time or times of grant, and the extent, if any, of Incentive Stock Options, Non-Qualified Stock Options, Stock
Appreciation Rights, Restricted Stock Awards, Restricted Stock Units, Unrestricted Stock Awards, Cash-Based Awards, and Dividend Equivalent
Rights, or any combination of the foregoing, granted to any one or more grantees;


 


(iii)           
to determine the number of shares of Stock to be covered by any Award;


 


(iv)          
to determine and modify from time to time the terms and conditions, including restrictions, not inconsistent with the terms of
the Plan, of any Award, which terms and conditions may differ among individual Awards and grantees, and to approve the forms of Award
Certificates;


 


(v)           
to accelerate at any time the exercisability or vesting of all or any portion of any Award;


 


(vi)          
subject to the provisions of Sections 5(c) or 6(d), to extend at any time the period in which Stock Options may be exercised
or Stock Appreciation Rights, respectively; and


 






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(vii)         
 at any time to adopt, alter and repeal such rules, guidelines and practices for administration of the Plan and for its own acts
and proceedings as it shall deem advisable; to interpret the terms and provisions of the Plan and any Award (including related written
instruments); to make all determinations it deems advisable for the administration of the Plan; to decide all disputes arising in connection
with the Plan; and to otherwise supervise the administration of the Plan.


 


All decisions and interpretations of the Administrator
shall be binding on all persons, including the Company and Plan grantees.


 


(c)              
Delegation of Authority to Grant Awards. Subject to applicable law, the Administrator, in its discretion, may delegate to
a committee consisting of one or more officers of the Company including the Chief Executive Officer of the Company, provided, however
that the Chief Executive Officer is also a director of the Company, all or part of the Administrator’s authority and duties with
respect to the granting of Awards to individuals who are (i) not subject to the reporting and other provisions of Section 16 of the
Exchange Act and (ii) not members of the delegated committee. Any such delegation by the Administrator shall include a limitation as to
the amount of Stock underlying Awards that may be granted during the period of the delegation and shall contain guidelines as to the determination
of the exercise price and the vesting criteria. The Administrator may revoke or amend the terms of a delegation at any time but such action
shall not invalidate any prior actions of the Administrator’s delegate or delegates that were consistent with the terms of the Plan.


 


(d)              
Award Certificate. Awards under the Plan shall be evidenced by Award Certificates that set forth the terms, conditions and
limitations for each Award which may include, without limitation, the term of an Award and the provisions applicable in the event the
Service Relationship terminates.


 


(e)              
Indemnification. Neither the Board nor the Administrator, nor any member of either or any delegate thereof, shall be liable
for any act, omission, interpretation, construction or determination made in good faith in connection with the Plan, and the members of
the Board and the Administrator (and any delegate thereof) shall be entitled in all cases to indemnification and reimbursement by the
Company in respect of any claim, loss, damage or expense (including, without limitation, reasonable attorneys’ fees) arising or
resulting therefrom to the fullest extent permitted by law and/or under the Company’s articles or bylaws or any directors’
and officers’ liability insurance coverage which may be in effect from time to time and/or any indemnification agreement between
such individual and the Company.


 


(f)                Non-U.S.
Award Recipients. Notwithstanding any provision of the Plan to the contrary, in order to comply with the laws in other countries
in which the Company and its Affiliates operate or have employees or other individuals eligible for Awards, the Administrator, in
its sole discretion, shall have the power and authority to: (i) determine which Affiliates shall be covered by the Plan; (ii)
determine which individuals outside the United States are eligible to participate in the Plan; (iii) modify the terms and conditions
of any Award granted to individuals outside the United States to comply with applicable laws; (iv) establish subplans and modify
exercise procedures and other terms and procedures, to the extent the Administrator determines such actions to be necessary or
advisable (and such subplans and/or modifications shall be attached to this Plan as appendices); provided, however, that no such
subplans and/or modifications shall increase the share limitations contained in Section 3(a) hereof; and (v) take any action, before
or after an Award is made, that the Administrator determines to be necessary or advisable to obtain approval or comply with any
local governmental regulatory exemptions or approvals. Notwithstanding the foregoing, the Administrator may not take any actions
hereunder, and no Awards shall be granted, that would violate the Exchange Act or any other applicable United States securities law,
the Code, or any other applicable United States governing statute or law.


 






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	SECTION 3. 	 STOCK ISSUABLE UNDER THE PLAN; MERGERS; SUBSTITUTION



 


(a)              
Stock Issuable. The maximum number of shares of Stock reserved and available for issuance under the Plan shall be 2,600,000
shares (the “Initial Limit”), subject to adjustment as provided in this Section 3, plus on January 1, 2022 and each January
1 thereafter, the number of shares of Stock reserved and available for issuance under the Plan shall be cumulatively increased by four
(4%) percent of the number of shares of Stock issued and outstanding on the immediately preceding December 31 (the “Annual Increase”).
Subject to such overall limitation, the maximum aggregate number of shares of Stock that may be issued in the form of Incentive Stock
Options shall not exceed the Initial Limit cumulatively increased on January 1, 2022 and on each January 1 thereafter by the lesser of
the Annual Increase for such year or 2,600,000 shares of Stock, subject in all cases to adjustment as provided in this Section 3. For
purposes of this limitation, the shares of Stock underlying any awards under the Plan and under the Company’s 2018 Equity Incentive
Plan that are forfeited, canceled, held back upon exercise of an Option or settlement of an Award to cover the exercise price or tax withholding,
reacquired by the Company prior to vesting, satisfied without the issuance of Stock or otherwise terminated (other than by exercise) shall
be added back to the shares of Stock available for issuance under the Plan and, to the extent permitted under Section 422 of the Code
and the regulations promulgated thereunder, the shares of Stock that may be issued as Incentive Stock Options. In the event the Company
repurchases shares of Stock on the open market, such shares shall not be added to the shares of Stock available for issuance under the
Plan. Subject to such overall limitations, shares of Stock may be issued up to such maximum number pursuant to any type or types of Award.
The shares available for issuance under the Plan may be authorized but unissued shares of Stock or shares of Stock reacquired by the Company.
Awards that may be settled solely in cash shall not be counted against the share reserve.


 


(b)               Changes
in Stock. Subject to Section 3(c) hereof, if, as a result of any reorganization, recapitalization, reclassification, stock
dividend, stock split, reverse stock split or other similar change in the Company’s capital stock, the outstanding shares of
Stock are increased or decreased or are exchanged for a different number or kind of shares or other securities of the Company, or
additional shares or new or different shares or other securities of the Company or other non-cash assets are distributed with
respect to such shares of Stock or other securities, or, if, as a result of any merger or consolidation, sale of all or
substantially all of the assets of the Company, the outstanding shares of Stock are converted into or exchanged for securities of
the Company or any successor entity (or a parent or subsidiary thereof), the Administrator shall make an appropriate or
proportionate adjustment in (i) the maximum number of shares reserved for issuance under the Plan, including the maximum number of
shares that may be issued in the form of Incentive Stock Options, (ii) the number and kind of shares or other securities subject to
any then outstanding Awards under the Plan, (iii) the repurchase price, if any, per share subject to each outstanding Restricted
Stock Award, and (iv) the exercise price for each share subject to any then outstanding Stock Options and Stock Appreciation
Rights under the Plan, without changing the aggregate exercise price (i.e., the exercise price multiplied by the number of shares
subject to Stock Options and Stock Appreciation Rights) as to which such Stock Options and Stock Appreciation Rights remain
exercisable. The Administrator shall also make equitable or proportionate adjustments in the number of shares subject to outstanding
Awards and the exercise price and the terms of outstanding Awards to take into consideration cash dividends paid other than in the
ordinary course or any other extraordinary corporate event. The adjustment by the Administrator shall be final, binding and
conclusive. No fractional shares of Stock shall be issued under the Plan resulting from any such adjustment, but the Administrator
in its discretion may make a cash payment in lieu of fractional shares.


 






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(c)              
Mergers and Other Transactions. In the case of and subject to the consummation of a Sale Event, the parties thereto may
cause the assumption or continuation of Awards theretofore granted by the successor entity, or the substitution of such Awards with new
Awards of the successor entity or parent thereof, with appropriate adjustment as to the number and kind of shares and, if appropriate,
the per share exercise prices, as such parties shall agree. To the extent that the parties to such Sale Event do not provide for the assumption,
continuation or substitution of Awards, upon the effective time of the Sale Event, the Plan and all outstanding Awards granted hereunder
shall terminate. In such case, except as may be otherwise provided in the relevant Award Certificate, all Options and Stock Appreciation
Rights with time-based vesting conditions or restrictions that are not vested and/or exercisable immediately prior to the effective time
of the Sale Event shall become fully vested and exercisable as of the effective time of the Sale Event, all other Awards with time-based
vesting, conditions or restrictions shall become fully vested and nonforfeitable as of the effective time of the Sale Event, and all Awards
with conditions and restrictions relating to the attainment of performance goals may become vested and nonforfeitable in connection with
a Sale Event in the Administrator’s discretion or to the extent specified in the relevant Award Certificate. In the event of such
termination, (i) the Company shall have the option (in its sole discretion) to make or provide for a payment, in cash or in kind, to the
grantees holding Options and Stock Appreciation Rights, in exchange for the cancellation thereof, in an amount equal to the difference
between (A) the Sale Price multiplied by the number of shares of Stock subject to outstanding Options and Stock Appreciation Rights (to
the extent then exercisable at prices not in excess of the Sale Price) and (B) the aggregate exercise price of all such outstanding Options
and Stock Appreciation Rights (provided that, in the case of an Option or Stock Appreciation Right with an exercise price equal to or
greater than the Sale Price, such Option or Stock Appreciation Right shall be cancelled for no consideration); or (ii) each grantee shall
be permitted, within a specified period of time prior to the consummation of the Sale Event as determined by the Administrator, to exercise
all outstanding Options and Stock Appreciation Rights (to the extent then exercisable) held by such grantee. The Company shall also have
the option (in its sole discretion) to make or provide for a payment, in cash or in kind, to the grantees holding other Awards in an amount
equal to the Sale Price multiplied by the number of vested shares of Stock under such Awards.


 


To the extent that the parties to such Sale
Event provide for the assumption, continuation or substitution of Awards, and in the event a grantee’s Service Relationship is
terminated by the Company or any successor other than for Cause or the grantee resigns for Good Reason, in either case upon or
during the 12-month period following the Sale Event, except as may be otherwise provided in the relevant Award Certificate, any such
Awards so assumed, continued or substituted in a Sale Event shall become fully vested, exercisable and nonforfeitable as of the date
of such termination.


 






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(d)              
Maximum Awards to Non-Employee Directors. Notwithstanding anything to the contrary in this Plan, the value of all Awards
awarded under this Plan and all other cash compensation paid by the Company to any Non-Employee Director for service as a Non-Employee
Director in any calendar year shall not exceed: (i) $1,000,000 in the first calendar year an individual becomes a Non-Employee Director
and (ii) $750,000 in any other calendar year. For the purpose of this limitation, the value of any Award shall be its grant date fair
value, as determined in accordance with ASC 718 or successor provision but excluding the impact of estimated forfeitures related to service-based
vesting provisions.


 


	SECTION 4. 	 ELIGIBILITY



 


Grantees under the Plan will be such employees,
Non-Employee Directors or Consultants of the Company and its Affiliates as are selected from time to time by the Administrator in its
sole discretion; provided that Awards may not be granted to employees, Non-Employee Directors or Consultants who are providing services
only to any “parent” of the Company, as such term is defined in Rule 405 of the Act, unless (i) the stock underlying the Awards
is treated as “service recipient stock” under Section 409A or (ii) the Company has determined that such Awards are exempt
from or otherwise comply with Section 409A.


 


	SECTION 5.	 STOCK OPTIONS



 


(a)              
Award of Stock Options. The Administrator may grant Stock Options under the Plan. Any Stock Option granted under the Plan
shall be in such form as the Administrator may from time to time approve.


 


Stock Options granted under the Plan may be either
Incentive Stock Options or Non-Qualified Stock Options. Incentive Stock Options may be granted only to employees of the Company or any
Subsidiary that is a “subsidiary corporation” within the meaning of Section 424(f) of the Code. To the extent that any
Option does not qualify as an Incentive Stock Option, it shall be deemed a Non-Qualified Stock Option.


 


Stock Options granted pursuant to this Section 5
shall be subject to the following terms and conditions and shall contain such additional terms and conditions, not inconsistent with the
terms of the Plan, as the Administrator shall deem desirable. If the Administrator so determines, Stock Options may be granted in lieu
of cash compensation at the optionee’s election, subject to such terms and conditions as the Administrator may establish.


 


(b)               Exercise
Price. The exercise price per share for the Stock covered by a Stock Option granted pursuant to this Section 5 shall be
determined by the Administrator at the time of grant but shall not be less than 100 percent of the Fair Market Value on the date of
grant. In the case of an Incentive Stock Option that is granted to a Ten Percent Owner, the exercise price of such Incentive Stock
Option shall be not less than 110 percent of the Fair Market Value on the grant date. Notwithstanding the foregoing, Stock Options
may be granted with an exercise price per share that is less than 100 percent of the Fair Market Value on the date of grant (i)
pursuant to a transaction described in, and in a manner consistent with, Section 424(a) of the Code, (ii) to individuals who are not
subject to U.S. income tax on the date of grant or (iii) the Stock Option is otherwise compliant with Section 409A.


 






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(c)              
Option Term. The term of each Stock Option shall be fixed by the Administrator, but no Stock Option shall be exercisable
more than ten years after the date the Stock Option is granted. In the case of an Incentive Stock Option that is granted to a Ten Percent
Owner, the term of such Stock Option shall be no more than five years from the date of grant.


 


(d)              
Exercisability; Rights of a Stockholder. Stock Options shall become exercisable at such time or times, whether or not in
installments, as shall be determined by the Administrator at or after the grant date. The Administrator may at any time accelerate the
exercisability of all or any portion of any Stock Option. An optionee shall have the rights of a stockholder only as to shares acquired
upon the exercise of a Stock Option and not as to unexercised Stock Options.


 


(e)              
Method of Exercise. Stock Options may be exercised in whole or in part, by giving written or electronic notice of exercise
to the Company, specifying the number of shares to be purchased. Payment of the purchase price may be made by one or more of the following
methods except to the extent otherwise provided in the Award Certificate:


 


(i)             
In cash, by certified or bank check or other instrument acceptable to the Administrator;


 


(ii)            
Through the delivery (or attestation to the ownership following such procedures as the Company may prescribe) of shares of Stock
that are not then subject to restrictions under any Company plan. Such surrendered shares shall be valued at Fair Market Value on the
exercise date;


 


(iii)           
By the optionee delivering to the Company a properly executed exercise notice together with irrevocable instructions to a broker
to promptly deliver to the Company cash or a check payable and acceptable to the Company for the purchase price; provided that in the
event the optionee chooses to pay the purchase price as so provided, the optionee and the broker shall comply with such procedures and
enter into such agreements of indemnity and other agreements as the Company shall prescribe as a condition of such payment procedure;
or


 


(iv)            With
respect to Stock Options that are not Incentive Stock Options, by a “net exercise” arrangement pursuant to which the
Company will reduce the number of shares of Stock issuable upon exercise by the largest whole number of shares with a Fair Market
Value that does not exceed the aggregate exercise price. Payment instruments will be received subject to collection. The transfer to
the optionee on the records of the Company or of the transfer agent of the shares of Stock to be purchased pursuant to the exercise
of a Stock Option will be contingent upon receipt from the optionee (or a purchaser acting in his stead in accordance with the
provisions of the Stock Option) by the Company of the full purchase price for such shares and the fulfillment of any other
requirements contained in the Award Certificate or applicable provisions of laws (including the satisfaction of any taxes that the
Company or any Affiliate is obligated to withhold with respect to the optionee). In the event an optionee chooses to pay the
purchase price by previously-owned shares of Stock through the attestation method, the number of shares of Stock transferred to the
optionee upon the exercise of the Stock Option shall be net of the number of attested shares. In the event that the Company
establishes, for itself or using the services of a third party, an automated system for the exercise of Stock Options, such as a
system using an internet website or interactive voice response, then the paperless exercise of Stock Options may be permitted
through the use of such an automated system.


 






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(f)               
Annual Limit on Incentive Stock Options. To the extent required for “incentive stock option” treatment under
Section 422 of the Code, the aggregate Fair Market Value (determined as of the time of grant) of the shares of Stock with respect
to which Incentive Stock Options granted under this Plan and any other plan of the Company or its parent and subsidiary corporations become
exercisable for the first time by an optionee during any calendar year shall not exceed $100,000. To the extent that any Stock Option
exceeds this limit, it shall constitute a Non-Qualified Stock Option.


 


	SECTION 6.	 STOCK APPRECIATION RIGHTS



 


(a)              
Award of Stock Appreciation Rights. The Administrator may grant Stock Appreciation Rights under the Plan. A Stock Appreciation
Right is an Award entitling the recipient to receive shares of Stock (or cash, to the extent explicitly provided for in the applicable
Award Certificate) having a value equal to the excess of the Fair Market Value of a share of Stock on the date of exercise over the exercise
price of the Stock Appreciation Right multiplied by the number of shares of Stock with respect to which the Stock Appreciation Right shall
have been exercised.


 


(b)              
Exercise Price of Stock Appreciation Rights. The exercise price of a Stock Appreciation Right shall not be less than 100
percent of the Fair Market Value of the Stock on the date of grant. Notwithstanding the foregoing, Stock Appreciation Rights may be granted
with an exercise price per share that is less than 100 percent of the Fair Market Value on the date of grant (i) pursuant to a transaction
described in, and in a manner consistent with, Section 424(a) of the Code, (ii) to individuals who are not subject to U.S. income tax
on the date of grant or (iii) the Stock Appreciation Right is otherwise compliant with Section 409A.


 


(c)              
Grant and Exercise of Stock Appreciation Rights. Stock Appreciation Rights may be granted by the Administrator independently
of any Stock Option granted pursuant to Section 5 of the Plan.


 


(d)              
Terms and Conditions of Stock Appreciation Rights. Stock Appreciation Rights shall be subject to such terms and conditions
as shall be determined on the date of grant by the Administrator. The term of a Stock Appreciation Right may not exceed ten years. The
terms and conditions of each such Award shall be determined by the Administrator, and such terms and conditions may differ among individual
Awards and grantees.


 


	SECTION 7.	 RESTRICTED STOCK AWARDS



 


(a)               Nature
of Restricted Stock Awards. The Administrator may grant Restricted Stock Awards under the Plan. A Restricted Stock Award is any
Award of Restricted Shares subject to such restrictions and conditions as the Administrator may determine at the time of grant.
Conditions may be based on continuing employment (or other Service Relationship) and/or achievement of pre-established performance
goals and objectives.


 






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(b)              
Rights as a Stockholder. Upon the grant of the Restricted Stock Award and payment of any applicable purchase price, a grantee
shall have the rights of a stockholder with respect to the voting of the Restricted Shares and receipt of dividends; provided that if
the lapse of restrictions with respect to the Restricted Stock Award is tied to the attainment of vesting conditions, any dividends paid
by the Company during the performance period shall accrue and shall not be paid to the grantee until and to the extent the vesting conditions
are met with respect to the Restricted Stock Award. Unless the Administrator shall otherwise determine, (i) uncertificated Restricted
Shares shall be accompanied by a notation on the records of the Company or the transfer agent to the effect that they are subject to forfeiture
until such Restricted Shares are vested as provided in Section 7(d) below, and (ii) certificated Restricted Shares shall remain in the
possession of the Company until such Restricted Shares are vested as provided in Section 7(d) below, and the grantee shall be required,
as a condition of the grant, to deliver to the Company such instruments of transfer as the Administrator may prescribe.


 


(c)              
Restrictions. Restricted Shares may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed of except
as specifically provided herein or in the Restricted Stock Award Certificate. Except as may otherwise be provided by the Administrator
either in the Award Certificate or, subject to Section 16 below, in writing after the Award is issued, if a grantee’s employment
(or other Service Relationship) with the Company and its Affiliates terminates for any reason, any Restricted Shares that have not vested
at the time of termination shall automatically and without any requirement of notice to such grantee from or other action by or on behalf
of, the Company be deemed to have been reacquired by the Company at its original purchase price (if any) from such grantee or such grantee’s
legal representative simultaneously with such termination of employment (or other Service Relationship), and thereafter shall cease to
represent any ownership of the Company by the grantee or rights of the grantee as a stockholder. Following such deemed reacquisition of
Restricted Shares that are represented by physical certificates, a grantee shall surrender such certificates to the Company upon request
without consideration.


 


(d)              
Vesting of Restricted Shares. The Administrator at the time of grant shall specify the date or dates and/or the attainment
of pre-established performance goals, objectives and other conditions on which the non-transferability of the Restricted Shares and the
Company’s right of repurchase or forfeiture shall lapse. Subsequent to such date or dates and/or the attainment of such pre-established
performance goals, objectives and other conditions, the shares on which all restrictions have lapsed shall no longer be Restricted Shares
and shall be deemed “vested.”


 






    11


    


    




	SECTION 8.	 RESTRICTED STOCK UNITS



 


(a)               Nature
of Restricted Stock Units. The Administrator may grant Restricted Stock Units under the Plan. A Restricted Stock Unit is an
Award of stock units that may be settled in shares of Stock (or cash, to the extent explicitly provided for in the Award
Certificate) upon the satisfaction of such restrictions and conditions at the time of grant. Conditions may be based on continuing
employment (or other Service Relationship) and/or achievement of pre-established performance goals and objectives. The terms and
conditions of each such Award shall be determined by the Administrator, and such terms and conditions may differ among individual
Awards and grantees. Except in the case of Restricted Stock Units with a deferred settlement date that complies with Section 409A,
at the end of the vesting period, the Restricted Stock Units, to the extent vested, shall be settled in the form of shares of Stock.
Restricted Stock Units with deferred settlement dates are subject to Section 409A and shall contain such additional terms and
conditions as the Administrator shall determine in its sole discretion in order to comply with the requirements of Section 409A.


 


(b)              
Election to Receive Restricted Stock Units in Lieu of Compensation. The Administrator may, in its sole discretion, permit
a grantee to elect to receive a portion of future cash compensation otherwise due to such grantee in the form of an award of Restricted
Stock Units. Any such election shall be made in writing and shall be delivered to the Company no later than the date specified by the
Administrator and in accordance with Section 409A and such other rules and procedures established by the Administrator. Any such future
cash compensation that the grantee elects to defer shall be converted to a fixed number of Restricted Stock Units based on the Fair Market
Value of Stock on the date the compensation would otherwise have been paid to the grantee if such payment had not been deferred as provided
herein. The Administrator shall have the sole right to determine whether and under what circumstances to permit such elections and to
impose such limitations and other terms and conditions thereon as the Administrator deems appropriate. Any Restricted Stock Units that
are elected to be received in lieu of cash compensation shall be fully vested, unless otherwise provided in the Award Certificate.


 


(c)              
Rights as a Stockholder. A grantee shall have the rights as a stockholder only as to shares of Stock acquired by the grantee
upon settlement of Restricted Stock Units; provided, however, that the grantee may be credited with Dividend Equivalent Rights with respect
to the stock units underlying his Restricted Stock Units, subject to the provisions of Section 11 and such terms and conditions as the
Administrator may determine.


 


(d)              
Termination. Except as may otherwise be provided by the Administrator either in the Award Certificate or, subject to Section 16
below, in writing after the Award is issued, a grantee’s right in all Restricted Stock Units that have not vested shall automatically
terminate upon the grantee’s termination of employment (or cessation of Service Relationship) with the Company and its Affiliates
for any reason.


 


	SECTION 9.	 UNRESTRICTED STOCK AWARDS



 


Grant or Sale of Unrestricted Stock. The
Administrator may grant (or sell at par value or such higher purchase price determined by the Administrator) an Unrestricted Stock Award
under the Plan. An Unrestricted Stock Award is an Award pursuant to which the grantee may receive shares of Stock free of any restrictions
under the Plan. Unrestricted Stock Awards may be granted in respect of past services or other valid consideration, or in lieu of cash
compensation due to such grantee.


 






    12


    


    




	SECTION 10.	 CASH-BASED AWARDS



 


Grant of Cash-Based Awards. The
Administrator may grant Cash-Based Awards under the Plan. A Cash-Based Award is an Award that entitles the grantee to a payment in
cash upon the attainment of specified performance goals. The Administrator shall determine the maximum duration of the Cash-Based
Award, the amount of cash to which the Cash-Based Award pertains, the conditions upon which the Cash-Based Award shall become vested
or payable, and such other provisions as the Administrator shall determine. Each Cash-Based Award shall specify a cash-denominated
payment amount, formula or payment ranges as determined by the Administrator. Payment, if any, with respect to a Cash-Based Award
shall be made in accordance with the terms of the Award and may be made in cash.


 


	SECTION 11. 	 DIVIDEND EQUIVALENT RIGHTS



 


(a)              
Dividend Equivalent Rights. The Administrator may grant Dividend Equivalent Rights under the Plan. A Dividend Equivalent
Right is an Award entitling the grantee to receive credits based on cash dividends that would have been paid on the shares of Stock specified
in the Dividend Equivalent Right (or other Award to which it relates) if such shares had been issued to the grantee. A Dividend Equivalent
Right may be granted hereunder to any grantee as a component of an award of Restricted Stock Units or as a freestanding award. The terms
and conditions of Dividend Equivalent Rights shall be specified in the Award Certificate. Dividend equivalents credited to the holder
of a Dividend Equivalent Right may be paid currently or may be deemed to be reinvested in additional shares of Stock, which may thereafter
accrue additional equivalents. Any such reinvestment shall be at Fair Market Value on the date of reinvestment or such other price as
may then apply under a dividend reinvestment plan sponsored by the Company, if any. Dividend Equivalent Rights may be settled in cash
or shares of Stock or a combination thereof, in a single installment or installments. A Dividend Equivalent Right granted as a component
of an Award of Restricted Stock Units shall provide that such Dividend Equivalent Right shall be settled only upon settlement or payment
of, or lapse of restrictions on, such other Award, and that such Dividend Equivalent Right shall expire or be forfeited or annulled under
the same conditions as such other Award.


 


(b)              
Termination. Except as may otherwise be provided by the Administrator either in the Award Certificate or, subject to Section 16
below, in writing after the Award is issued, a grantee’s rights in all Dividend Equivalent Rights shall automatically terminate
upon the grantee’s termination of employment (or cessation of Service Relationship) with the Company and its Affiliates for any
reason.


 


	SECTION 12. 	 Transferability of Awards



 


(a)              
Transferability. Except as provided in Section 12(b) below, during a grantee’s lifetime, his or her Awards shall
be exercisable only by the grantee, or by the grantee’s legal representative or guardian in the event of the grantee’s incapacity.
No Awards shall be sold, assigned, transferred or otherwise encumbered or disposed of by a grantee other than by will or by the laws of
descent and distribution or pursuant to a domestic relations order. No Awards shall be subject, in whole or in part, to attachment, execution,
or levy of any kind, and any purported transfer in violation hereof shall be null and void.


 






    13


    


    




(b)               Administrator
Action. Notwithstanding Section 12(a), the Administrator, in its discretion, may provide either in the Award Certificate
regarding a given Award or by subsequent written approval that the grantee (who is an employee or Non-Employee Director) may
transfer his or her Non-Qualified Stock Options to his or her immediate family members, to trusts for the benefit of such family
members, or to partnerships in which such family members are the only partners, provided that the transferee agrees in writing with
the Company to be bound by all of the terms and conditions of this Plan and the applicable Award Certificate. In no event may an
Award be transferred by a grantee for value.


 


(c)              
Family Member. For purposes of Section 12(b), “family member” shall mean a grantee’s 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 grantee’s household
(other than a tenant of the grantee), a trust in which these persons (or the grantee) have more than 50 percent of the beneficial interest,
a foundation in which these persons (or the grantee) control the management of assets, and any other entity in which these persons (or
the grantee) own more than 50 percent of the voting interests.


 


(d)              
Designation of Beneficiary. To the extent permitted by the Company and valid under applicable law, each grantee to whom
an Award has been made under the Plan may designate a beneficiary or beneficiaries to exercise any Award or receive any payment under
any Award payable on or after the grantee’s death. Any such designation shall be on a form provided for that purpose by the Administrator
and shall not be effective until received by the Administrator. If no beneficiary has been designated by a deceased grantee, or if the
designated beneficiaries have predeceased the grantee, the beneficiary shall be the grantee’s estate.


 


	SECTION 13.	 TAX WITHHOLDING



 


(a)              
Payment by Grantee. Each grantee shall, no later than the date as of which the value of an Award or of any Stock or other
amounts received thereunder first becomes includable in the gross income of the grantee for Federal income tax purposes, pay to the Company,
or make arrangements satisfactory to the Administrator regarding payment of, any Federal, state, or local taxes of any kind required by
law to be withheld by the Company with respect to such income. The Company and its Subsidiaries shall, to the extent permitted by law,
have the right to deduct any such taxes from any payment of any kind otherwise due to the grantee. The Company’s obligation to deliver
evidence of book entry (or stock certificates) to any grantee is subject to and conditioned on tax withholding obligations being satisfied
by the grantee.


 


(b)               Payment
in Stock. The Administrator may require the Company’s tax withholding obligation to be satisfied, in whole or in part, by
the Company withholding from shares of Stock to be issued pursuant to any Award a number of shares with an aggregate Fair Market
Value (as of the date the withholding is effected) that would satisfy the withholding amount due; provided, however, that the amount
withheld does not exceed the maximum statutory tax rate or such lesser amount as is necessary to avoid liability accounting
treatment. For purposes of share withholding, the Fair Market Value of withheld shares shall be determined in the same manner as the
value of Stock includible in income of the grantees. The Administrator may also require the Company’s tax withholding
obligation to be satisfied, in whole or in part, by an arrangement whereby a certain number of shares of Stock issued pursuant to
any Award are immediately sold and proceeds from such sale are remitted to the Company in an amount that would satisfy the
withholding amount due.


 






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	SECTION 14.	 Section 409A awards



 


Awards are intended to be exempt from Section 409A
to the greatest extent possible and to otherwise comply with Section 409A. The Plan and all Awards shall be interpreted in accordance
with such intent. To the extent that any Award is determined to constitute “nonqualified deferred compensation” within the
meaning of Section 409A (a “409A Award”), the Award shall be subject to such additional rules and requirements as specified
by the Administrator from time to time in order to comply with Section 409A. In this regard, if any amount under a 409A Award is payable
upon a “separation from service” (within the meaning of Section 409A) to a grantee who is then considered a “specified
employee” (within the meaning of Section 409A), then no such payment shall be made prior to the date that is the earlier of (i)
six months and one day after the grantee’s separation from service, or (ii) the grantee’s death, but only to the extent such
delay is necessary to prevent such payment from being subject to interest, penalties and/or additional tax imposed pursuant to Section
409A. Further, the settlement of any 409A Award may not be accelerated except to the extent permitted by Section 409A. The Company makes
no representation that any or all of the payments or benefits described in the Plan will be exempt from or comply with Section 409A of
the Code and makes no undertaking to preclude Section 409A of the Code from applying to any such payment. The grantee shall be solely
responsible for the payment of any taxes and penalties incurred under Section 409A.


 


	SECTION 15.	 TERMINATION OF SERVICE RELATIONSHIP, TRANSFER, LEAVE OF ABSENCE, ETC.



 


(a)              
Termination of Service Relationship. If the grantee’s Service Relationship is with an Affiliate and such Affiliate
ceases to be an Affiliate, the grantee shall be deemed to have terminated his or her Service Relationship for purposes of the Plan.


 


(b)              
For purposes of the Plan, the following events shall not be deemed a termination of a Service Relationship:


 


(i)             
a transfer to the Service Relationship of the Company from an Affiliate or from the Company to an Affiliate, or from one Affiliate
to another; or


 


(ii)            
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 re-employment is guaranteed either by a statute or by contract or under the policy pursuant to which the leave of absence was
granted or if the Administrator otherwise so provides in writing.


 






    15


    


    




	SECTION 16.	 AMENDMENTS AND TERMINATION



 


The Board may, at any time, amend or discontinue the Plan and the Administrator may, at any time, amend or cancel any outstanding Award
for the purpose of satisfying changes in law or for any other lawful purpose, but no such action shall materially and adversely affect
rights under any outstanding Award without the holder’s consent. The Administrator is specifically authorized to exercise its discretion
to reduce the exercise price of outstanding Stock Options or Stock Appreciation Rights or effect the repricing of such Awards through
cancellation and re-grants or cancellation of Stock Options or Stock Appreciation Rights in exchange for cash or other Awards. To the
extent required under the rules of any securities exchange or market system on which the Stock is listed, to the extent determined by
the Administrator to be required by the Code to ensure that Incentive Stock Options granted under the Plan are qualified under Section 422
of the Code, Plan amendments shall be subject to approval by Company stockholders. Nothing in this Section 16 shall limit the Administrator’s
authority to take any action permitted pursuant to Section 3(b) or 3(c).


 


	SECTION 17. 	 STATUS OF PLAN



 


With respect to the portion of any Award that has
not been exercised and any payments in cash, Stock or other consideration not received by a grantee, a grantee shall have no rights greater
than those of a general creditor of the Company unless the Administrator shall otherwise expressly determine in connection with any Award
or Awards. In its sole discretion, the Administrator may authorize the creation of trusts or other arrangements to meet the Company’s
obligations to deliver Stock or make payments with respect to Awards hereunder, provided that the existence of such trusts or other arrangements
is consistent with the foregoing sentence.


 


	SECTION 18.	 GENERAL PROVISIONS



 


(a)              
No Distribution. The Administrator may require each person acquiring Stock pursuant to an Award to represent to and agree
with the Company in writing that such person is acquiring the shares without a view to distribution thereof.


 


(b)               Issuance
of Stock. To the extent certificated, stock certificates to grantees under this Plan shall be deemed delivered for all purposes
when the Company or a stock transfer agent of the Company shall have mailed such certificates in the United States mail, addressed
to the grantee, at the grantee’s last known address on file with the Company. Uncertificated Stock shall be deemed delivered
for all purposes when the Company or a Stock transfer agent of the Company shall have given to the grantee by electronic mail (with
proof of receipt) or by United States mail, addressed to the grantee, at the grantee’s last known address on file with the
Company, notice of issuance and recorded the issuance in its records (which may include electronic “book entry”
records). Notwithstanding anything herein to the contrary, the Company shall not be required to issue or deliver any evidence of
book entry or certificates evidencing shares of Stock pursuant to the exercise or settlement of any Award, unless and until the
Administrator has determined, with advice of counsel (to the extent the Administrator deems such advice necessary or advisable),
that the issuance and delivery is in compliance with all applicable laws, regulations of governmental authorities and, if
applicable, the requirements of any exchange on which the shares of Stock are listed, quoted or traded. Any Stock issued pursuant to
the Plan shall be subject to any stop-transfer orders and other restrictions as the Administrator deems necessary or advisable to
comply with federal, state or foreign jurisdiction, securities or other laws, rules and quotation system on which the Stock is
listed, quoted or traded. The Administrator may place legends on any Stock certificate or notations on any book entry to reference
restrictions applicable to the Stock. In addition to the terms and conditions provided herein, the Administrator may require that an
individual make such reasonable covenants, agreements, and representations as the Administrator, in its discretion, deems necessary
or advisable in order to comply with any such laws, regulations, or requirements. The Administrator shall have the right to require
any individual to comply with any timing or other restrictions with respect to the settlement or exercise of any Award, including a
window-period limitation, as may be imposed in the discretion of the Administrator.


 






    16


    


    




(c)              
Stockholder Rights. Until Stock is deemed delivered in accordance with Section 18(b), no right to vote or receive dividends
or any other rights of a stockholder will exist with respect to shares of Stock to be issued in connection with an Award, notwithstanding
the exercise of a Stock Option or any other action by the grantee with respect to an Award.


 


(d)              
Other Compensation Arrangements; No Employment Rights. Nothing contained in this Plan shall prevent the Board from adopting
other or additional compensation arrangements, including trusts, and such arrangements may be either generally applicable or applicable
only in specific cases. The adoption of this Plan and the grant of Awards do not confer upon any employee any right to continued employment
with the Company or any Subsidiary.


 


(e)              
Trading Policy Restrictions. Option exercises and other Awards under the Plan shall be subject to the Company’s insider
trading policies and procedures, as in effect from time to time.


 


(f)               
Clawback Policy. Awards under the Plan shall be subject to the Company’s clawback policy, as in effect from time to
time.


 


	SECTION 19. 	 EFFECTIVE DATE OF PLAN



 


This Plan shall become effective upon the date
immediately preceding the Registration Date subject to prior stockholder approval in accordance with applicable state law, the Company’s
bylaws and articles of incorporation, and applicable stock exchange rules. No grants of Awards may be made hereunder after the tenth anniversary
of the Effective Date and no grants of Incentive Stock Options may be made hereunder after the tenth anniversary of the date the Plan
is approved by the Board.


 


	SECTION 20.	 GOVERNING LAW



 


This Plan and all Awards and actions taken thereunder
shall be governed by, and construed in accordance with, the General Corporation Law of the State of Delaware as to matters within the
scope thereof, and as to all other matters shall be governed by and construed in accordance with the internal laws of the State of Delaware
applied without regard to conflict of law principles.


 


DATE APPROVED BY BOARD OF DIRECTORS: June 17, 2021


 


DATE APPROVED BY STOCKHOLDERS: June 17, 2021


 








    17


     


    

 





 


 


INCENTIVE STOCK OPTION AGREEMENT

UNDER THE AEROVATE THERAPEUTICS, INC.

2021 STOCK OPTION AND INCENTIVE PLAN


 


	Name of Optionee:	 	 	 
	 	 	 	 	 
	No. of Option Shares:	 	 	 
	 	 	 	 
	 	 	 
	Option Exercise Price per Share:	 	$	 
	 	 	 	 
		 	[FMV on Grant Date (110% of FMV if a 10% owner)]
	 	 	 
	Grant Date:	 	 	 
	 	 	 	 
	 	 	 
	Expiration Date:	 	 	 
	 	 	 	 
	 	 	[up to 10 years (5 if a 10% owner)]




 


Pursuant to the Aerovate Therapeutics, Inc. 2021
Stock Option and Incentive Plan as amended through the date hereof (the “Plan”), Aerovate Therapeutics, Inc. (the “Company”)
hereby grants to the Optionee named above an option (the “Stock Option”) to purchase on or prior to the Expiration Date specified
above all or part of the number of shares of Common Stock, par value $0.0001 per share (the “Stock”), of the Company specified
above at the Option Exercise Price per Share specified above subject to the terms and conditions set forth herein and in the Plan.


 


1.                 
Exercisability Schedule. No portion of this Stock Option may be exercised until such portion shall have become exercisable.
Except as set forth below, and subject to the discretion of the Administrator (as defined in Section 2 of the Plan) to accelerate the
exercisability schedule hereunder, this Stock Option shall be exercisable with respect to the following number of Option Shares on the
dates indicated so long as the Optionee remains in a Service Relationship on such dates:


 


	Incremental Number of

Option Shares Exercisable*	Exercisability Date
	 	 
	_____________ (___%)	____________
	_____________ (___%)	____________
	_____________ (___%)	____________
	_____________ (___%)	____________
	_____________ (___%)	____________


 


* Max. of $100,000 per yr.


 


Once exercisable, this Stock Option shall continue
to be exercisable at any time or times prior to the close of business on the Expiration Date, subject to the provisions hereof and of
the Plan.


 






     


     


    

 


2.            
Manner of Exercise.


 


(a)              
The Optionee may exercise this Stock Option only in the following manner: from time to time on or prior to the Expiration Date
of this Stock Option, the Optionee may give written notice to the Administrator of his or her election to purchase some or all of the
Option Shares purchasable at the time of such notice. This notice shall specify the number of Option Shares to be purchased.


 


Payment of the purchase price for the Option Shares
may be made by one or more of the following methods: (i) in cash, by certified or bank check or other instrument acceptable to the
Administrator; (ii) through the delivery (or attestation to the ownership) of shares of Stock that have been purchased by the Optionee
on the open market or that are beneficially owned by the Optionee and are not then subject to any restrictions under any Company plan
and that otherwise satisfy any holding periods as may be required by the Administrator; or (iii) by the Optionee delivering to the
Company a properly executed exercise notice together with irrevocable instructions to a broker to promptly deliver to the Company cash
or a check payable and acceptable to the Company to pay the option purchase price, provided that in the event the Optionee chooses to
pay the option purchase price as so provided, the Optionee and the broker shall comply with such procedures and enter into such agreements
of indemnity and other agreements as the Administrator shall prescribe as a condition of such payment procedure; or (iv) a combination
of (i), (ii) and (iii) above. Payment instruments will be received subject to collection.


 


The transfer to the Optionee on the records of
the Company or of the transfer agent of the Option Shares will be contingent upon (i) the Company’s receipt from the Optionee of
the full purchase price for the Option Shares, as set forth above, (ii) the fulfillment of any other requirements contained herein or
in the Plan or in any other agreement or provision of laws, and (iii) the receipt by the Company of any agreement, statement or other
evidence that the Company may require to satisfy itself that the issuance of Stock to be purchased pursuant to the exercise of Stock Options
under the Plan and any subsequent resale of the shares of Stock will be in compliance with applicable laws and regulations. In the event
the Optionee chooses to pay the purchase price by previously-owned shares of Stock through the attestation method, the number of shares
of Stock transferred to the Optionee upon the exercise of the Stock Option shall be net of the Shares attested to.


 


(b)              
The shares of Stock purchased upon exercise of this Stock Option shall be transferred to the Optionee on the records of the Company
or of the transfer agent upon compliance to the satisfaction of the Administrator with all requirements under applicable laws or regulations
in connection with such transfer and with the requirements hereof and of the Plan. The determination of the Administrator as to such compliance
shall be final and binding on the Optionee. The Optionee shall not be deemed to be the holder of, or to have any of the rights of a holder
with respect to, any shares of Stock subject to this Stock Option unless and until this Stock Option shall have been exercised pursuant
to the terms hereof, the Company or the transfer agent shall have transferred the shares to the Optionee, and the Optionee’s name
shall have been entered as the stockholder of record on the books of the Company. Thereupon, the Optionee shall have full voting, dividend
and other ownership rights with respect to such shares of Stock.


 






    2


     


    

 


(c)              
 The minimum number of shares with respect to which this Stock Option may be exercised at any one time shall be 100 shares, unless
the number of shares with respect to which this Stock Option is being exercised is the total number of shares subject to exercise under
this Stock Option at the time.


 


(d)              
Notwithstanding any other provision hereof or of the Plan, no portion of this Stock Option shall be exercisable after the Expiration
Date hereof.


 


3.            
Termination of Employment. If the Optionee’s Service Relationship is terminated, the period within which to exercise
the Stock Option may be subject to earlier termination as set forth below.


 


(a)              
Termination Due to Death. If the Optionee’s Service Relationship terminates by reason of the Optionee’s death,
any portion of this Stock Option outstanding on such date, to the extent exercisable on the date of death, may thereafter be exercised
by the Optionee’s legal representative or legatee for a period of 12 months from the date of death or until the Expiration Date,
if earlier. Any portion of this Stock Option that is not exercisable on the date of death shall terminate immediately and be of no further
force or effect.


 


(b)              
Termination Due to Disability. If the Optionee’s Service Relationship terminates by reason of the Optionee’s
disability (as determined by the Administrator), any portion of this Stock Option outstanding on such date, to the extent exercisable
on the date of such termination, may thereafter be exercised by the Optionee for a period of 12 months from the date of disability or
until the Expiration Date, if earlier. Any portion of this Stock Option that is not exercisable on the date of disability shall terminate
immediately and be of no further force or effect.


 


(c)              
Termination for Cause. If the Optionee’s Service Relationship terminates for Cause, any portion of this Stock Option
outstanding on such date shall terminate immediately and be of no further force and effect.


 


(d)              
Other Termination. If the Optionee’s Service Relationship terminates for any reason other than the Optionee’s
death, the Optionee’s disability, or Cause, and unless otherwise determined by the Administrator, any portion of this Stock Option
outstanding on such date may be exercised, to the extent exercisable on the date of termination, for a period of three months from the
date of termination or until the Expiration Date, if earlier. Any portion of this Stock Option that is not exercisable on the date of
termination shall terminate immediately and be of no further force or effect.


 


The Administrator’s determination of the
reason for termination of the Optionee’s Service Relationship shall be conclusive and binding on the Optionee and his or her representatives
or legatees.


 


4.            
Incorporation of Plan. Notwithstanding anything herein to the contrary, this Stock Option shall be subject to and governed
by all the terms and conditions of the Plan, including the powers of the Administrator set forth in Section 2(b) of the Plan. Capitalized
terms in this Agreement shall have the meaning specified in the Plan, unless a different meaning is specified herein.


 


5.            
Transferability. This Agreement is personal to the Optionee, is non-assignable and is not transferable in any manner, by
operation of law or otherwise, other than by will or the laws of descent and distribution. This Stock Option is exercisable, during the
Optionee’s lifetime, only by the Optionee, and thereafter, only by the Optionee’s legal representative or legatee.


 






    3


     


    

 


6.            
Status of the Stock Option. This Stock Option is intended to qualify as an “incentive stock option” under Section
422 of the Internal Revenue Code of 1986, as amended (the “Code”), but the Company does not represent or warrant that this
Stock Option qualifies as such. The Optionee should consult with his or her own tax advisors regarding the tax effects of this Stock Option
and the requirements necessary to obtain favorable income tax treatment under Section 422 of the Code, including, but not limited
to, holding period requirements. To the extent any portion of this Stock Option does not so qualify as an “incentive stock option,”
such portion shall be deemed to be a non-qualified stock option. If the Optionee intends to dispose or does dispose (whether by sale,
gift, transfer or otherwise) of any Option Shares within the one-year period beginning on the date after the transfer of such shares to
him or her, or within the two-year period beginning on the day after the grant of this Stock Option, he or she will so notify the Company
within 30 days after such disposition.


 


7.            
Tax Withholding. The Optionee shall, not later than the date as of which the exercise of this Stock Option becomes a taxable
event for Federal income tax purposes, pay to the Company or make arrangements satisfactory to the Administrator for payment of any Federal,
state, and local taxes required by law to be withheld on account of such taxable event. The Company shall have the authority to cause
the required tax withholding obligation to be satisfied, in whole or in part, by withholding from shares of Stock to be issued to the
Optionee a number of shares of Stock with an aggregate Fair Market Value that would satisfy the withholding amount due.


 


8.            
No Obligation to Continue Service Relationship. Neither the Company nor any Subsidiary is obligated by or as a result of
the Plan or this Agreement to continue the Optionee in a Service Relationship and neither the Plan nor this Agreement shall interfere
in any way with the right of the Company or any Subsidiary to terminate the Service Relationship of the Optionee at any time.


 


9.            
Integration. This Agreement constitutes the entire agreement between the parties with respect to this Stock Option and supersedes
all prior agreements and discussions between the parties concerning such subject matter.


 


10.           Data
Privacy Consent. In order to administer the Plan and this Agreement and to implement or structure future equity grants, the
Company, its subsidiaries and affiliates and certain agents thereof (together, the “Relevant Companies”) may process any
and all personal or professional data, including but not limited to Social Security or other identification number, home address and
telephone number, date of birth and other information that is necessary or desirable for the administration of the Plan and/or this
Agreement (the “Relevant Information”). By entering into this Agreement, the Optionee (i) authorizes the Company to
collect, process, register and transfer to the Relevant Companies all Relevant Information; (ii) waives any privacy rights the
Optionee may have with respect to the Relevant Information; (iii) authorizes the Relevant Companies to store and transmit such
information in electronic form; and (iv) authorizes the transfer of the Relevant Information to any jurisdiction in which the
Relevant Companies consider appropriate. The Optionee shall have access to, and the right to change, the Relevant Information.
Relevant Information will only be used in accordance with applicable law.


 


11.          
Notices. Notices hereunder shall be mailed or delivered to the Company at its principal place of business and shall be mailed
or delivered to the Optionee at the address on file with the Company or, in either case, at such other address as one party may subsequently
furnish to the other party in writing.


 






    4


     


    

 


	 	Aerovate Therapeutics,
    Inc.
	 	 	 
	 	By:	 
	 	 	Title:




 


The foregoing Agreement is hereby accepted and the terms and conditions
thereof hereby agreed to by the undersigned. Electronic acceptance of this Agreement pursuant to the Company’s instructions to the
Optionee (including through an online acceptance process) is acceptable.


 


	Dated:	 	 	 	 
	 	Optionee’s Signature
	 	 
	 	Optionee’s name and address:
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 




 






    5


     


    

 





 


 


NON-QUALIFIED STOCK
OPTION AGREEMENT


FOR COMPANY EMPLOYEES

UNDER THE AEROVATE THERAPEUTICS, INC.

2021 STOCK OPTION AND INCENTIVE PLAN


 





	Name of Optionee:	 	 	 
	 	 	 	 	 
	No. of Option Shares:	 	 	 
	 	 	 	 
	 	 	 
	Option Exercise Price per Share:	 	$	 
	 	 	 	 
		 	[FMV on Grant Date]
	 	 	 
	Grant Date:	 	 	 
	 	 	 	 
	 	 	 
	Expiration Date:	 	 	 
	 	 	 	 


 


Pursuant to the Aerovate Therapeutics, Inc. 2021
Stock Option and Incentive Plan as amended through the date hereof (the “Plan”), Aerovate Therapeutics, Inc. (the “Company”)
hereby grants to the Optionee named above an option (the “Stock Option”) to purchase on or prior to the Expiration Date specified
above all or part of the number of shares of Common Stock, par value $0.0001 per share (the “Stock”) of the Company specified
above at the Option Exercise Price per Share specified above subject to the terms and conditions set forth herein and in the Plan. This
Stock Option is not intended to be an “incentive stock option” under Section 422 of the Internal Revenue Code of 1986, as
amended.


 


1.                 
Exercisability Schedule. No portion of this Stock Option may be exercised until such portion shall have become exercisable.
Except as set forth below, and subject to the discretion of the Administrator (as defined in Section 2 of the Plan) to accelerate
the exercisability schedule hereunder, this Stock Option shall be exercisable with respect to the following number of Option Shares on
the dates indicated so long as Optionee remains in a Service Relationship on such dates:


 


	Incremental Number of

Option Shares Exercisable	Exercisability Date
	_____________ (___%)	____________
	_____________ (___%)	____________
	_____________ (___%)	____________
	_____________ (___%)	____________
	_____________ (___%)	____________


 


Once exercisable, this Stock Option shall continue
to be exercisable at any time or times prior to the close of business on the Expiration Date, subject to the provisions hereof and of
the Plan.


 






     


     


    

 


2.            
Manner of Exercise.


 


(a)              
The Optionee may exercise this Stock Option only in the following manner: from time to time on or prior to the Expiration Date
of this Stock Option, the Optionee may give written notice to the Administrator of his or her election to purchase some or all of the
Option Shares purchasable at the time of such notice. This notice shall specify the number of Option Shares to be purchased.


 


Payment of the purchase price for the Option Shares
may be made by one or more of the following methods: (i) in cash, by certified or bank check or other instrument acceptable to the
Administrator; (ii) through the delivery (or attestation to the ownership) of shares of Stock that have been purchased by the Optionee
on the open market or that are beneficially owned by the Optionee and are not then subject to any restrictions under any Company plan
and that otherwise satisfy any holding periods as may be required by the Administrator; (iii) by the Optionee delivering to the Company
a properly executed exercise notice together with irrevocable instructions to a broker to promptly deliver to the Company cash or a check
payable and acceptable to the Company to pay the option purchase price, provided that in the event the Optionee chooses to pay the option
purchase price as so provided, the Optionee and the broker shall comply with such procedures and enter into such agreements of indemnity
and other agreements as the Administrator shall prescribe as a condition of such payment procedure; (iv) by a “net exercise”
arrangement pursuant to which the Company will reduce the number of shares of Stock issuable upon exercise by the largest whole number
of shares with a Fair Market Value that does not exceed the aggregate exercise price; or (v) a combination of (i), (ii), (iii) and
(iv) above. Payment instruments will be received subject to collection.


 


The transfer to the Optionee on the records of
the Company or of the transfer agent of the Option Shares will be contingent upon (i) the Company’s receipt from the Optionee of
the full purchase price for the Option Shares, as set forth above, (ii) the fulfillment of any other requirements contained herein or
in the Plan or in any other agreement or provision of laws, and (iii) the receipt by the Company of any agreement, statement or other
evidence that the Company may require to satisfy itself that the issuance of Stock to be purchased pursuant to the exercise of Stock Options
under the Plan and any subsequent resale of the shares of Stock will be in compliance with applicable laws and regulations. In the event
the Optionee chooses to pay the purchase price by previously-owned shares of Stock through the attestation method, the number of shares
of Stock transferred to the Optionee upon the exercise of the Stock Option shall be net of the Shares attested to.


 


(b)               The
shares of Stock purchased upon exercise of this Stock Option shall be transferred to the Optionee on the records of the Company or
of the transfer agent upon compliance to the satisfaction of the Administrator with all requirements under applicable laws or
regulations in connection with such transfer and with the requirements hereof and of the Plan. The determination of the
Administrator as to such compliance shall be final and binding on the Optionee. The Optionee shall not be deemed to be the holder
of, or to have any of the rights of a holder with respect to, any shares of Stock subject to this Stock Option unless and until this
Stock Option shall have been exercised pursuant to the terms hereof, the Company or the transfer agent shall have transferred the
shares to the Optionee, and the Optionee’s name shall have been entered as the stockholder of record on the books of the
Company. Thereupon, the Optionee shall have full voting, dividend and other ownership rights with respect to such shares of
Stock.


 






    2


     


    

 


(c)              
The minimum number of shares with respect to which this Stock Option may be exercised at any one time shall be 100 shares, unless
the number of shares with respect to which this Stock Option is being exercised is the total number of shares subject to exercise under
this Stock Option at the time.


 


(d)              
Notwithstanding any other provision hereof or of the Plan, no portion of this Stock Option shall be exercisable after the Expiration
Date hereof.


 


3.            
Termination of Employment. If the Optionee’s Service Relationship is terminated, the period within which to exercise
the Stock Option may be subject to earlier termination as set forth below.


 


(a)              
Termination Due to Death. If the Optionee’s Service Relationship terminates by reason of the Optionee’s death,
any portion of this Stock Option outstanding on such date, to the extent exercisable on the date of death, may thereafter be exercised
by the Optionee’s legal representative or legatee for a period of 12 months from the date of death or until the Expiration Date,
if earlier. Any portion of this Stock Option that is not exercisable on the date of death shall terminate immediately and be of no further
force or effect.


 


(b)              
Termination Due to Disability. If the Optionee’s Service Relationship terminates by reason of the Optionee’s
disability (as determined by the Administrator), any portion of this Stock Option outstanding on such date, to the extent exercisable
on the date of such termination, may thereafter be exercised by the Optionee for a period of 12 months from the date of disability or
until the Expiration Date, if earlier. Any portion of this Stock Option that is not exercisable on the date of disability shall terminate
immediately and be of no further force or effect.


 


(c)              
Termination for Cause. If the Optionee’s Service Relationship terminates for Cause, any portion of this Stock Option
outstanding on such date shall terminate immediately and be of no further force and effect.


 


(d)              
Other Termination. If the Optionee’s Service Relationship terminates for any reason other than the Optionee’s
death, the Optionee’s disability or Cause, and unless otherwise determined by the Administrator, any portion of this Stock Option
outstanding on such date may be exercised, to the extent exercisable on the date of termination, for a period of three months from the
date of termination or until the Expiration Date, if earlier. Any portion of this Stock Option that is not exercisable on the date of
termination shall terminate immediately and be of no further force or effect.


 


The Administrator’s determination of the
reason for termination of the Optionee’s Service Relationship shall be conclusive and binding on the Optionee and his or her representatives
or legatees.


 


4.             Incorporation
of Plan. Notwithstanding anything herein to the contrary, this Stock Option shall be subject to and governed by all the terms
and conditions of the Plan, including the powers of the Administrator set forth in Section 2(b) of the Plan. Capitalized terms in
this Agreement shall have the meaning specified in the Plan, unless a different meaning is specified herein.


 






    3


     


    

 


5.            
Transferability. This Agreement is personal to the Optionee, is non-assignable and is not transferable in any manner, by
operation of law or otherwise, other than by will or the laws of descent and distribution. This Stock Option is exercisable, during the
Optionee’s lifetime, only by the Optionee, and thereafter, only by the Optionee’s legal representative or legatee.


 


6.            
Tax Withholding. The Optionee shall, not later than the date as of which the exercise of this Stock Option becomes a taxable
event for Federal income tax purposes, pay to the Company or make arrangements satisfactory to the Administrator for payment of any Federal,
state, and local taxes required by law to be withheld on account of such taxable event. The Company shall have the authority to cause
the required tax withholding obligation to be satisfied, in whole or in part, by withholding from shares of Stock to be issued to the
Optionee a number of shares of Stock with an aggregate Fair Market Value that would satisfy the withholding amount due.


 


7.             
No Obligation to Continue Service Relationship. Neither the Company nor any Subsidiary is obligated by or as a result of
the Plan or this Agreement to continue the Optionee in a Service Relationship and neither the Plan nor this Agreement shall interfere
in any way with the right of the Company or any Subsidiary to terminate the Service Relationship of the Optionee at any time.


 


8.            
Integration. This Agreement constitutes the entire agreement between the parties with respect to this Stock Option and supersedes
all prior agreements and discussions between the parties concerning such subject matter.


 


9.            
Data Privacy Consent. In order to administer the Plan and this Agreement and to implement or structure future equity grants,
the Company, its subsidiaries and affiliates and certain agents thereof (together, the “Relevant Companies”) may process any
and all personal or professional data, including but not limited to Social Security or other identification number, home address and telephone
number, date of birth and other information that is necessary or desirable for the administration of the Plan and/or this Agreement (the
 “Relevant Information”). By entering into this Agreement, the Optionee (i) authorizes the Company to collect, process, register
and transfer to the Relevant Companies all Relevant Information; (ii) waives any privacy rights the Optionee may have with respect to
the Relevant Information; (iii) authorizes the Relevant Companies to store and transmit such information in electronic form; and (iv)
authorizes the transfer of the Relevant Information to any jurisdiction in which the Relevant Companies consider appropriate. The Optionee
shall have access to, and the right to change, the Relevant Information. Relevant Information will only be used in accordance with applicable
law.


 


10.              Notices.
Notices hereunder shall be mailed or delivered to the Company at its principal place of business and shall be mailed or delivered to
the Optionee at the address on file with the Company or, in either case, at such other address as one party may subsequently furnish
to the other party in writing.


 






    4


     


    

 


	 	AEROVATE THERAPEUTICS, INC.
	 	 
	 	By:  	 
	 	 	Title:




 


The foregoing Agreement is hereby accepted and the terms and conditions
thereof hereby agreed to by the undersigned. Electronic acceptance of this Agreement pursuant to the Company’s instructions to the
Optionee (including through an online acceptance process) is acceptable.


 


	Dated:  	 	 	 
	 	 	Optionee’s Signature
	 	 	 
	 	 	Optionee’s name and address:
	 	 	 
	 	 	 
	 	 	 




 








    5


     


    




 


NON-QUALIFIED
STOCK OPTION AGREEMENT

FOR NON-EMPLOYEE DIRECTORS

UNDER THe AEROVATE THERAPEUTICS, INC.

2021 STOCK OPTION AND INCENTIVE PLAN


 


	Name of Optionee:	 	 	 
	 	 	 	 
	No. of Option Shares:	 	 	 
	 	 	 	 
	Option Exercise Price per Share:	$	 
	 	[FMV on Grant Date]	 
	 	 
	Grant Date:	 	 
	 	 	 
	Expiration Date:	 	 
	 	[No more than 10 years]	 



 


Pursuant to the Aerovate Therapeutics, Inc. 2021
Stock Option and Incentive Plan as amended through the date hereof (the “Plan”), Aerovate Therapeutics, Inc. (the “Company”)
hereby grants to the Optionee named above, who is a Director of the Company but is not an employee of the Company, an option (the “Stock
Option”) to purchase on or prior to the Expiration Date specified above all or part of the number of shares of Common Stock, par
value $0.0001 per share (the “Stock”), of the Company specified above at the Option Exercise Price per Share specified above
subject to the terms and conditions set forth herein and in the Plan. This Stock Option is not intended to be an “incentive stock
option” under Section 422 of the Internal Revenue Code of 1986, as amended.


 


1.             Exercisability Schedule. No portion of this Stock Option may be exercised until such portion shall have become exercisable.
Except as set forth below, and subject to the discretion of the Administrator (as defined in Section 2 of the Plan) to accelerate
the exercisability schedule hereunder, this Stock Option shall be exercisable with respect to the following number of Option Shares on
the dates indicated so long as the Optionee remains in a Service Relationship on such dates:


 


	Incremental Number of

Option Shares Exercisable	Exercisability Date
	_____________ (___%)	____________
	_____________ (___%)	____________
	_____________ (___%)	____________
	_____________ (___%)	____________
	_____________ (___%)	____________



 






    


     


    

 


Once exercisable, this Stock Option shall continue
to be exercisable at any time or times prior to the close of business on the Expiration Date, subject to the provisions hereof and of
the Plan.


 


2.             Manner
of Exercise.


 


(a)              
The Optionee may exercise this Stock Option only in the following manner: from time to time on or prior to the Expiration Date
of this Stock Option, the Optionee may give written notice to the Administrator of his or her election to purchase some or all of the
Option Shares purchasable at the time of such notice. This notice shall specify the number of Option Shares to be purchased.


 


Payment of the purchase price for the Option Shares
may be made by one or more of the following methods: (i) in cash, by certified or bank check or other instrument acceptable to the
Administrator; (ii) through the delivery (or attestation to the ownership) of shares of Stock that have been purchased by the Optionee
on the open market or that are beneficially owned by the Optionee and are not then subject to any restrictions under any Company plan
and that otherwise satisfy any holding periods as may be required by the Administrator; (iii) by the Optionee delivering to the Company
a properly executed exercise notice together with irrevocable instructions to a broker to promptly deliver to the Company cash or a check
payable and acceptable to the Company to pay the option purchase price, provided that in the event the Optionee chooses to pay the option
purchase price as so provided, the Optionee and the broker shall comply with such procedures and enter into such agreements of indemnity
and other agreements as the Administrator shall prescribe as a condition of such payment procedure; (iv) by a “net exercise”
arrangement pursuant to which the Company will reduce the number of shares of Stock issuable upon exercise by the largest whole number
of shares with a Fair Market Value that does not exceed the aggregate exercise price; or (v) a combination of (i), (ii), (iii) and
(iv) above. Payment instruments will be received subject to collection.


 


The transfer to the Optionee on the records of
the Company or of the transfer agent of the Option Shares will be contingent upon (i) the Company’s receipt from the Optionee of
the full purchase price for the Option Shares, as set forth above, (ii) the fulfillment of any other requirements contained herein or
in the Plan or in any other agreement or provision of laws, and (iii) the receipt by the Company of any agreement, statement or other
evidence that the Company may require to satisfy itself that the issuance of Stock to be purchased pursuant to the exercise of Stock Options
under the Plan and any subsequent resale of the shares of Stock will be in compliance with applicable laws and regulations. In the event
the Optionee chooses to pay the purchase price by previously-owned shares of Stock through the attestation method, the number of shares
of Stock transferred to the Optionee upon the exercise of the Stock Option shall be net of the Shares attested to.


 


(b)               The
shares of Stock purchased upon exercise of this Stock Option shall be transferred to the Optionee on the records of the Company or
of the transfer agent upon compliance to the satisfaction of the Administrator with all requirements under applicable laws or
regulations in connection with such transfer and with the requirements hereof and of the Plan. The determination of the
Administrator as to such compliance shall be final and binding on the Optionee. The Optionee shall not be deemed to be the holder
of, or to have any of the rights of a holder with respect to, any shares of Stock subject to this Stock Option unless and until this
Stock Option shall have been exercised pursuant to the terms hereof, the Company or the transfer agent shall have transferred the
shares to the Optionee, and the Optionee’s name shall have been entered as the stockholder of record on the books of the
Company. Thereupon, the Optionee shall have full voting, dividend and other ownership rights with respect to such shares of
Stock.


 






    2


     


    

 


(c)              
The minimum number of shares with respect to which this Stock Option may be exercised at any one time shall be 100 shares, unless
the number of shares with respect to which this Stock Option is being exercised is the total number of shares subject to exercise under
this Stock Option at the time.


 


(d)              
Notwithstanding any other provision hereof or of the Plan, no portion of this Stock Option shall be exercisable after the Expiration
Date hereof.


 


3.             Termination
of Service Relationship. If the Optionee’s Service Relationship is terminated, the period within which to exercise the Stock
Option may be subject to earlier termination as set forth below.


 


(a)              
Termination Due to Death. If the Optionee’s Service Relationship terminates by reason of the Optionee’s death,
any portion of this Stock Option outstanding on such date, to the extent exercisable on the date of death, may thereafter be exercised
by the Optionee’s legal representative or legatee for a period of 12 months from the date of death or until the Expiration Date,
if earlier. Any portion of this Stock Option that is not exercisable on the date of death shall terminate immediately and be of no further
force or effect.


 


(b)              
Other Termination. If the Optionee’s Service Relationship terminates for any reason other than the Optionee’s
death, any portion of this Stock Option outstanding on such date may be exercised, to the extent exercisable on the date the Optionee
ceased to be a Director, for a period of six months from the date the Optionee’s Service Relationship terminates or until the Expiration
Date, if earlier. Any portion of this Stock Option that is not exercisable on the date the Optionee ceases to be a Director shall terminate
immediately and be of no further force or effect.


 


4.            Incorporation of Plan. Notwithstanding anything herein to the contrary, this Stock Option shall be subject to and governed
by all the terms and conditions of the Plan, including the powers of the Administrator set forth in Section 2(b) of the Plan. Capitalized
terms in this Agreement shall have the meaning specified in the Plan, unless a different meaning is specified herein.


 


5.             Transferability. This Agreement is personal to the Optionee, is non-assignable and is not transferable in any manner, by
operation of law or otherwise, other than by will or the laws of descent and distribution. This Stock Option is exercisable, during the
Optionee’s lifetime, only by the Optionee, and thereafter, only by the Optionee’s legal representative or legatee.


 


6.            No
Obligation to Continue in Service Relationship. Neither the Plan nor this Stock Option confers upon the Optionee any rights with
respect to continuance in a Service Relationship.


 






    3


     


    

 


7.           
Integration. This Agreement constitutes the entire agreement between the parties with respect to this Stock Option and
supersedes all prior agreements and discussions between the parties concerning such subject matter.


 


8.            Data
Privacy Consent. In order to administer the Plan and this Agreement and to implement or structure future equity grants, the Company,
its subsidiaries and affiliates and certain agents thereof (together, the “Relevant Companies”) may process any and all personal
or professional data, including but not limited to Social Security or other identification number, home address and telephone number,
date of birth and other information that is necessary or desirable for the administration of the Plan and/or this Agreement (the “Relevant
Information”). By entering into this Agreement, the Optionee (i) authorizes the Company to collect, process, register and transfer
to the Relevant Companies all Relevant Information; (ii) waives any privacy rights the Optionee may have with respect to the Relevant
Information; (iii) authorizes the Relevant Companies to store and transmit such information in electronic form; and (iv) authorizes the
transfer of the Relevant Information to any jurisdiction in which the Relevant Companies consider appropriate. The Optionee shall have
access to, and the right to change, the Relevant Information. Relevant Information will only be used in accordance with applicable law.


 






    4


     


    

 


9.            Notices. Notices hereunder shall be mailed or delivered to the Company at its principal place of business and shall be
mailed or delivered to the Optionee at the address on file with the Company or, in either case, at such other address as one party may
subsequently furnish to the other party in writing.


 


	 	AEROVATE THERAPEUTICS, INC.
	 	 
	 	By: 	 
	 	 	Title:




 


The foregoing Agreement is hereby accepted and the terms and conditions
thereof hereby agreed to by the undersigned. Electronic acceptance of this Agreement pursuant to the Company’s instructions to the
Optionee (including through an online acceptance process) is acceptable.


 


	Dated: 	 	 	 
	 	 	Optionee’s Signature
	 	 	 
	 	 	Optionee’s name and address:
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 



 






    5


     


    

 


 


 


RESTRICTED
STOCK UNIT AWARD AGREEMENT

FOR COMPANY EMPLOYEES

UNDER THE AEROVATE THERAPEUTICS, INC.

2021 STOCK OPTION AND INCENTIVE PLAN


 





	Name of Grantee:	 	 
	 	 	 
	No. of Restricted Stock Units:	                                                                         	 
	 	 	 
	Grant Date:	                                                                         	 


 


Pursuant to the Aerovate Therapeutics, Inc. 2021
Stock Option and Incentive Plan as amended through the date hereof (the “Plan”), Aerovate Therapeutics, Inc. (the “Company”)
hereby grants an award of the number of Restricted Stock Units listed above (an “Award”) to the Grantee named above. Each
Restricted Stock Unit shall relate to one share of Common Stock, par value $0.0001 per share (the “Stock”) of the Company.


 


1.                 
Restrictions on Transfer of Award. This Award may not be sold, transferred, pledged, assigned or otherwise encumbered or
disposed of by the Grantee, and any shares of Stock issuable with respect to the Award may not be sold, transferred, pledged, assigned
or otherwise encumbered or disposed of until (i) the Restricted Stock Units have vested as provided in Paragraph 2 of this Agreement and
(ii) shares of Stock have been issued to the Grantee in accordance with the terms of the Plan and this Agreement.


 


2.                 
Vesting of Restricted Stock Units. The restrictions and conditions of Paragraph 1 of this Agreement shall lapse on
the Vesting Date or Dates specified in the following schedule so long as the Grantee remains in a Service Relationship on such Dates.
If a series of Vesting Dates is specified, then the restrictions and conditions in Paragraph 1 shall lapse only with respect to the
number of Restricted Stock Units specified as vested on such date.


 


	Incremental Number of

Restricted Stock Units Vested	Vesting Date
	_____________ (___%)	_______________
	_____________ (___%)	_______________
	_____________ (___%)	_______________
	_____________ (___%)	_______________


The Administrator may at any time accelerate the
vesting schedule specified in this Paragraph 2.


 


3.                  Termination
of Service Relationship. If the Grantee’s Service Relationship terminates for any reason (including death or disability)
prior to the satisfaction of the vesting conditions set forth in Paragraph 2 above, any Restricted Stock Units that have not vested
as of such date shall automatically and without notice terminate and be forfeited, and neither the Grantee nor any of his or her
successors, heirs, assigns, or personal representatives will thereafter have any further rights or interests in such unvested
Restricted Stock Units.


 






     


     


    

 


4.                 
Issuance of Shares of Stock. As soon as practicable following each Vesting Date (but in no event later than two and one-half
months after the end of the year in which the Vesting Date occurs), the Company shall issue to the Grantee the number of shares of Stock
equal to the aggregate number of Restricted Stock Units that have vested pursuant to Paragraph 2 of this Agreement on such date and the
Grantee shall thereafter have all the rights of a stockholder of the Company with respect to such shares.


 


5.                 
Incorporation of Plan. Notwithstanding anything herein to the contrary, this Agreement shall be subject to and governed
by all the terms and conditions of the Plan, including the powers of the Administrator set forth in Section 2(b) of the Plan. Capitalized
terms in this Agreement shall have the meaning specified in the Plan, unless a different meaning is specified herein.


 


6.                 
Tax Withholding. The Grantee shall, not later than the date as of which the receipt of this Award becomes a taxable event
for Federal income tax purposes, pay to the Company or make arrangements satisfactory to the Administrator for payment of any Federal,
state, and local taxes required by law to be withheld on account of such taxable event. The Company shall have the authority to cause
the required tax withholding obligation to be satisfied, in whole or in part, by withholding from shares of Stock to be issued to the
Grantee a number of shares of Stock with an aggregate Fair Market Value that would satisfy the withholding amount due.


 


7.                 
Section 409A of the Code. This Agreement shall be interpreted in such a manner that all provisions relating to the settlement
of the Award are exempt from the requirements of Section 409A of the Code as “short-term deferrals” as described in Section
409A of the Code.


 


8.                 
No Obligation to Continue Service Relationship. Neither the Company nor any Subsidiary is obligated by or as a result of
the Plan or this Agreement to continue the Grantee in a Service Relationship and neither the Plan nor this Agreement shall interfere in
any way with the right of the Company or any Subsidiary to terminate the Service Relationship of the Grantee at any time.


 


9.                 
Integration. This Agreement constitutes the entire agreement between the parties with respect to this Award and supersedes
all prior agreements and discussions between the parties concerning such subject matter.


 


10.              Data
Privacy Consent. In order to administer the Plan and this Agreement and to implement or structure future equity grants, the
Company, its subsidiaries and affiliates and certain agents thereof (together, the “Relevant Companies”) may process any
and all personal or professional data, including but not limited to Social Security or other identification number, home address and
telephone number, date of birth and other information that is necessary or desirable for the administration of the Plan and/or this
Agreement (the “Relevant Information”). By entering into this Agreement, the Grantee (i) authorizes the Company to
collect, process, register and transfer to the Relevant Companies all Relevant Information; (ii) waives any privacy rights the
Grantee may have with respect to the Relevant Information; (iii) authorizes the Relevant Companies to store and transmit such
information in electronic form; and (iv) authorizes the transfer of the Relevant Information to any jurisdiction in which the
Relevant Companies consider appropriate. The Grantee shall have access to, and the right to change, the Relevant Information.
Relevant Information will only be used in accordance with applicable law.


 






    2


     


    

 


11.             
Notices. Notices hereunder shall be mailed or delivered to the Company at its principal place of business and shall be
mailed or delivered to the Grantee at the address on file with the Company or, in either case, at such other address as one party may
subsequently furnish to the other party in writing. 





 


	 	AEROVATE THERAPEUTICS, INC.
	 	 	 
	 	By:	 
	 	 	Title:



 


The foregoing Agreement is hereby accepted and the terms and conditions
thereof hereby agreed to by the undersigned. Electronic acceptance of this Agreement pursuant to the Company’s instructions to the
Grantee (including through an online acceptance process) is acceptable.


 


	Dated:	 	 	 
	 	 	 	Grantee’s Signature
	 	 	 	 
	 	 	 	Grantee’s name and address:
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 



 






    3


     


    

 


 





RESTRICTED
STOCK UNIT AWARD AGREEMENT

FOR NON-EMPLOYEE DIRECTORS

UNDER THE AEROVATE THERAPEUTICS, INC.

2021 STOCK OPTION AND INCENTIVE PLAN


 


	Name of Grantee: 	 	 
	 	 	 	 
	No. of Restricted Stock Units:	 	 	 
	 	 	 	 
	Grant Date:	 	 	 




 


Pursuant to the Aerovate Therapeutics, Inc. 2021
Stock Option and Incentive Plan as amended through the date hereof (the “Plan”), Aerovate Therapeutics, Inc. (the “Company”)
hereby grants an award of the number of Restricted Stock Units listed above (an “Award”) to the Grantee named above. Each
Restricted Stock Unit shall relate to one share of Common Stock, par value $0.0001 per share (the “Stock”) of the Company.


 


1.                 
Restrictions on Transfer of Award. This Award may not be sold, transferred, pledged, assigned or otherwise encumbered or
disposed of by the Grantee, and any shares of Stock issuable with respect to the Award may not be sold, transferred, pledged, assigned
or otherwise encumbered or disposed of until (i) the Restricted Stock Units have vested as provided in Paragraph 2 of this Agreement and
(ii) shares of Stock have been issued to the Grantee in accordance with the terms of the Plan and this Agreement.


 


2.                 
Vesting of Restricted Stock Units. The restrictions and conditions of Paragraph 1 of this Agreement shall lapse on
the Vesting Date or Dates specified in the following schedule so long as the Grantee remains in a Service Relationship. If a series of
Vesting Dates is specified, then the restrictions and conditions in Paragraph 1 shall lapse only with respect to the number of Restricted
Stock Units specified as vested on such date.


 


	Incremental Number of

Restricted Stock Units Vested	Vesting Date
	_____________ (___%)	_______________
	_____________ (___%)	_______________
	_____________ (___%)	_______________
	_____________ (___%)	_______________


 


The Administrator may at any time accelerate the
vesting schedule specified in this Paragraph 2.


 


3.                 
Termination of Service Relationship. If the Grantee’s Service Relationship terminates for any reason (including death
or disability) prior to the satisfaction of the vesting conditions set forth in Paragraph 2 above, any Restricted Stock Units that have
not vested as of such date shall automatically and without notice terminate and be forfeited, and neither the Grantee nor any of his
or her successors, heirs, assigns, or personal representatives will thereafter have any further rights or interests in such unvested
Restricted Stock Units.


 






     


     


    

 


4.                 
Issuance of Shares of Stock. As soon as practicable following each Vesting Date (but in no event later than two and one-half
months after the end of the year in which the Vesting Date occurs), the Company shall issue to the Grantee the number of shares of Stock
equal to the aggregate number of Restricted Stock Units that have vested pursuant to Paragraph 2 of this Agreement on such date and the
Grantee shall thereafter have all the rights of a stockholder of the Company with respect to such shares.


 


5.                 
Incorporation of Plan. Notwithstanding anything herein to the contrary, this Agreement shall be subject to and governed
by all the terms and conditions of the Plan, including the powers of the Administrator set forth in Section 2(b) of the Plan. Capitalized
terms in this Agreement shall have the meaning specified in the Plan, unless a different meaning is specified herein.


 


6.                 
Section 409A of the Code. This Agreement shall be interpreted in such a manner that all provisions relating to the settlement
of the Award are exempt from the requirements of Section 409A of the Code as “short-term deferrals” as described in Section
409A of the Code.


 


7.                 
No Obligation to Continue in Service Relationship. Neither the Plan nor this Award confers upon the Grantee any rights with
respect to continuance in a Service Relationship.


 


8.                 
Integration. This Agreement constitutes the entire agreement between the parties with respect to this Award and supersedes
all prior agreements and discussions between the parties concerning such subject matter.


 


9.                 
Data Privacy Consent. In order to administer the Plan and this Agreement and to implement or structure future equity grants,
the Company, its subsidiaries and affiliates and certain agents thereof (together, the “Relevant Companies”) may process any
and all personal or professional data, including but not limited to Social Security or other identification number, home address and telephone
number, date of birth and other information that is necessary or desirable for the administration of the Plan and/or this Agreement (the
 “Relevant Information”). By entering into this Agreement, the Grantee (i) authorizes the Company to collect, process, register
and transfer to the Relevant Companies all Relevant Information; (ii) waives any privacy rights the Grantee may have with respect to the
Relevant Information; (iii) authorizes the Relevant Companies to store and transmit such information in electronic form; and (iv) authorizes
the transfer of the Relevant Information to any jurisdiction in which the Relevant Companies consider appropriate. The Grantee shall have
access to, and the right to change, the Relevant Information. Relevant Information will only be used in accordance with applicable law.


 






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10.             
 Notices. Notices hereunder shall be mailed or delivered to the Company at its principal place of business and shall be
mailed or delivered to the Grantee at the address on file with the Company or, in either case, at such other address as one party may
subsequently furnish to the other party in writing.


 


	 	AEROVATE THERAPEUTICS, INC.
	 	 
	 	 
	 	By:	 
	 	 	Title:



 



The foregoing Agreement is hereby accepted and the terms and conditions
thereof hereby agreed to by the undersigned. Electronic acceptance of this Agreement pursuant to the Company’s instructions to the
Grantee (including through an online acceptance process) is acceptable.


 


	Dated:	 	 	 
	 	 	 	Grantee’s Signature
	 	 	 	 
	 	 	 	 
	 	 	 	Grantee’s name and address:
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 



 









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RESTRICTED STOCK
AWARD AGREEMENT


UNDER THE AEROVATE THERAPEUTICS, INC.


2021 STOCK OPTION AND INCENTIVE PLAN


 


	Name of Grantee:	 	 



 


	No. of Shares:	 	 
	 	 	 
	Grant Date:	 	 




 


Pursuant to the Aerovate Therapeutics, Inc. 2021
Stock Option and Incentive Plan (the “Plan”) as amended through the date hereof, Aerovate Therapeutics, Inc. (the “Company”)
hereby grants a Restricted Stock Award (an “Award”) to the Grantee named above. Upon acceptance of this Award, the Grantee
shall receive the number of shares of Common Stock, par value $0.0001 per share (the “Stock”) of the Company specified above,
subject to the restrictions and conditions set forth herein and in the Plan. The Company acknowledges the receipt from the Grantee of
consideration with respect to the par value of the Stock in the form of cash, past or future services rendered to the Company by the Grantee
or such other form of consideration as is acceptable to the Administrator.


 


1.                 
Award. The shares of Restricted Stock awarded hereunder shall be issued and held by the Company’s transfer agent in
book entry form, and the Grantee’s name shall be entered as the stockholder of record on the books of the Company. Thereupon, the
Grantee shall have all the rights of a stockholder with respect to such shares, including voting and dividend rights, subject, however,
to the restrictions and conditions specified in Paragraph 2 below. The Grantee shall (i) sign and deliver to the Company a copy of
this Award Agreement and (ii) deliver to the Company a stock power endorsed in blank.


 


2.                 
Restrictions and Conditions.


 


(a)              
Any book entries for the shares of Restricted Stock granted herein shall bear an appropriate legend, as determined by the Administrator
in its sole discretion, to the effect that such shares are subject to restrictions as set forth herein and in the Plan.


 


(b)              
Shares of Restricted Stock granted herein may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed of
by the Grantee prior to vesting.


 


(c)              
If the Grantee’s Service Relationship is voluntarily or involuntarily terminated for any reason (including death) prior to
vesting of shares of Restricted Stock granted herein, all shares of Restricted Stock shall immediately and automatically be forfeited
and returned to the Company.


 






     


     


    

 


3.                  Vesting
of Restricted Stock. The restrictions and conditions in Paragraph 2 of this Agreement shall lapse on the Vesting Date or
Dates specified in the following schedule so long as the Grantee remains in a Service Relationship on such Dates. If a series of
Vesting Dates is specified, then the restrictions and conditions in Paragraph 2 shall lapse only with respect to the number of
shares of Restricted Stock specified as vested on such date.


 


	Incremental Number 

of Shares Vested	Vesting Date
	 	 
	                         
        (         %)	                             
      
	                         
       (       
     %)	                             
      
	                         
  (         %)	                             
      
	                         
       (       
     %)	                             
      
	                         
       (       
     %)	                             
      




 


Subsequent to such Vesting Date or Dates, the shares
of Stock on which all restrictions and conditions have lapsed shall no longer be deemed Restricted Stock. The Administrator may at any
time accelerate the vesting schedule specified in this Paragraph 3.


 


4.                 
Dividends. Dividends on shares of Restricted Stock shall be paid currently to the Grantee.


 


5.                 
Incorporation of Plan. Notwithstanding anything herein to the contrary, this Award shall be subject to and governed by all
the terms and conditions of the Plan, including the powers of the Administrator set forth in Section 2(b) of the Plan. Capitalized terms
in this Agreement shall have the meaning specified in the Plan, unless a different meaning is specified herein.


 


6.                 
Transferability. This Agreement is personal to the Grantee, is non-assignable and is not transferable in any manner, by
operation of law or otherwise, other than by will or the laws of descent and distribution.


 


7.                 
Tax Withholding. The Grantee shall, not later than the date as of which the receipt of this Award becomes a taxable event
for Federal income tax purposes, pay to the Company or make arrangements satisfactory to the Administrator for payment of any Federal,
state, and local taxes required by law to be withheld on account of such taxable event. Except in the case where an election is made pursuant
to Paragraph 8 below, the Company shall have the authority to cause the required tax withholding obligation to be satisfied, in whole
or in part, by withholding from shares of Stock to be issued or released by the transfer agent a number of shares of Stock with an aggregate
Fair Market Value that would satisfy the withholding amount due.


 


8.                 
Election Under Section 83(b). The Grantee and the Company hereby agree that the Grantee may, within 30 days following the
Grant Date of this Award, file with the Internal Revenue Service and the Company an election under Section 83(b) of the Internal Revenue
Code. In the event the Grantee makes such an election, he or she agrees to provide a copy of the election to the Company. The Grantee
acknowledges that he or she is responsible for obtaining the advice of his or her tax advisors with regard to the Section 83(b) election
and that he or she is relying solely on such advisors and not on any statements or representations of the Company or any of its agents
with regard to such election.


 






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9.                 
 No Obligation to Continue Service Relationship. Neither the Company nor any Subsidiary is obligated by or as a result of
the Plan or this Agreement to continue the Grantee in a Service Relationship and neither the Plan nor this Agreement shall interfere in
any way with the right of the Company or any Subsidiary to terminate the Service Relationship of the Grantee at any time.


 


10.             
Integration. This Agreement constitutes the entire agreement between the parties with respect to this Award and supersedes
all prior agreements and discussions between the parties concerning such subject matter.


 


11.             
Data Privacy Consent. In order to administer the Plan and this Agreement and to implement or structure future equity grants,
the Company, its subsidiaries and affiliates and certain agents thereof (together, the “Relevant Companies”) may process any
and all personal or professional data, including but not limited to Social Security or other identification number, home address and telephone
number, date of birth and other information that is necessary or desirable for the administration of the Plan and/or this Agreement (the
 “Relevant Information”). By entering into this Agreement, the Grantee (i) authorizes the Company to collect, process, register
and transfer to the Relevant Companies all Relevant Information; (ii) waives any privacy rights the Grantee may have with respect to the
Relevant Information; (iii) authorizes the Relevant Companies to store and transmit such information in electronic form; and (iv) authorizes
the transfer of the Relevant Information to any jurisdiction in which the Relevant Companies consider appropriate. The Grantee shall have
access to, and the right to change, the Relevant Information. Relevant Information will only be used in accordance with applicable law.


 






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12.             
 Notices. Notices hereunder shall be mailed or delivered to the Company at its principal place of business and shall be
mailed or delivered to the Grantee at the address on file with the Company or, in either case, at such other address as one party may
subsequently furnish to the other party in writing.


 


	 	AEROVATE THERAPEUTICS, INC.






 


	 	 
	 	By:  	 
	 	 	Title:




 


The foregoing Agreement is hereby accepted and the terms and conditions
thereof hereby agreed to by the undersigned. Electronic acceptance of this Agreement pursuant to the Company’s instructions to the
Grantee (including through an online acceptance process) is acceptable.


 
	Dated:	 	 	
	 	 	 	Grantee’s Signature


 


	 	Grantee’s name and address:
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 



 






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