Document:

EXHIBIT
10.8

 

BIOSTAGE,
Inc.

 

2013 EQUITY INCENTIVE PLAN

 

1.    GENERAL PURPOSE
OF THE PLAN; DEFINITIONS

 

The name of the plan
is the Biostage, Inc. 2013 Equity Incentive Plan (the “Plan”). The purpose of the Plan is to encourage and enable
the officers, employees, Non-Employee Directors, and other key persons (including consultants) of Biostage, Inc. (the “Company”)
and its Subsidiaries upon whose judgment, initiative and efforts the Company largely depends for the successful conduct of its
business to acquire a proprietary interest in the Company. 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, thereby stimulating
their efforts on the Company’s behalf and strengthening their desire to remain with the Company. In addition, the issuance
of Awards in partial substitution of equity awards that cover shares of the common stock of Harvard Bioscience, Inc. (“HBIO”)
immediately prior to the spin-off of the Company by HBIO are authorized to be issued under this Plan.

 

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.

 

“Adjustment
Awards” is defined in Section 4.

 

“Administrator”
is defined in Section 2(a).

 

“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, Deferred Stock Awards, Restricted Stock Awards, Unrestricted
Stock Awards, Performance Share Awards and Dividend Equivalent Rights.

 

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

 

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

 

“Change of
Control” is defined in Section 19.

 

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

 

“Committee”
means the Compensation Committee of the Board or a similar committee performing the functions of the Compensation Committee and
that is comprised of not less than two Independent Directors.

 

“Covered
Employee” means an employee who is a “Covered Employee” within the meaning of Section 162(m) of the
Code.

 

“Deferred
Stock Award” means Awards granted pursuant to Section 8.

 

"Distribution
Date" means the date that HBIO distributes to holders of shares of its outstanding common stock, through a spin-off, at
least 50% of the outstanding shares of the Company’s common stock (the “Spin-Off”).

 

“Dividend
Equivalent Right” means Awards granted pursuant to Section 13.

 

“Effective
Date” shall have the meaning specified in Section 21 hereof.

 

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

 

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“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 traded on a national securities exchange the Fair Market Value of the Stock will equal
the closing sales price as reported on the principal exchange or market for the Stock on such date, provided further that with
respect to the Separation Grants and the initial Non-Employee Director grants described in Section 5(b)(i)(1), the Fair Market
Value on the date of grant for such grants shall mean the arithmetic average of the daily dollar volume-weighted average price
of the Stock (during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time) for each of
the ten (10) Trading Days immediately preceding the date of grant. If there is no trading on such date, the determination shall
be made by reference to the last date preceding such date for which there was trading.

 

“HBIO Award”
shall have the meaning specified in Section 4 hereof.

 

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

 

“Independent
Director” means a member of the Board who is not also an employee of the Company or any Subsidiary and who is independent.

 

“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.

 

“Parent”
means Harvard Bioscience, Inc., a Delaware corporation that, as of the Effective Date is the parent of the Company. If at any time
Harvard Bioscience, Inc. ceases to hold stock representing more than 50% of the Voting Securities of the Company, it shall no longer
be treated as the Parent.

 

“Performance
Share Award” means Awards granted pursuant to Section 11.

 

“Performance
Cycle” means one or more periods of time, which may be of varying and overlapping durations, as the Administrator may
select, over which the attainment of one or more performance criteria will be measured for the purpose of determining a grantee’s
right to and the payment of a Performance Share Award, Restricted Stock Award or Deferred Stock Award. Each such period shall not
be less than three months.

 

“Restricted
Stock Award” means Awards granted pursuant to Section 7.

 

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

 

“Separation
Grants” means the initial Stock Options granted by the Company to certain executives and employees of the Company in
connection with the Spin-Off which shall be granted on the eleventh Trading Day after the Distribution Date (with the first Trading
Day being the Trading Day immediately after the Distribution Date).

 

“Spin-Off”
shall have the meaning specified in the definition of Distribution Date.

 

“Stock”
means the Common Stock, par value $.01 per share, of the Company, subject to adjustments pursuant to Section 3.

 

“Stock Appreciation
Right” means any Award granted pursuant to Section 6.

 

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“Subsidiary”
means any corporation or other entity (other than the Company) in any unbroken chain of corporations or other entities beginning
with the Company if each of the corporations or entities (other than the last corporation or entity in the unbroken chain) owns
stock or other interests possessing 50 percent or more of the economic interest or the total combined voting power of all classes
of stock or other interests in one of the other corporations or entities in the chain.

 

“Trading
Day” means any day on which the Stock is traded on a national securities exchange, or, if a national securities exchange
is not the principal trading market for the Stock, then on the principal securities exchange or securities market on which the
Stock is then traded, provided that “Trading Day” shall not include any day on which the Stock is scheduled to trade
on such exchange or market for less than 4.5 hours or any day that the Stock is suspended from trading during the final hour of
trading on such exchange or market (or if such exchange or market does not designate in advance the closing time of trading on
such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).

 

“Unrestricted
Stock Award” means any Award granted pursuant to Section 9.

 

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

 

(a) Committee.
The Plan shall be administered by either the Board or the Committee (in either case, 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, Deferred Stock Awards, Unrestricted Stock Awards, Performance Share 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 form of written
instruments evidencing the Awards;

 

(v) to
accelerate at any time the exercisability or vesting of all or any portion of any Award; provided that, other than by reason of,
or in connection with, any death, disability, retirement, employment termination (without cause or by the employee for good reason),
Sale Event or Change of Control, the Administrator shall not accelerate or waive any restriction period applicable to any outstanding
Restricted Stock Award, Deferred Stock Award or Performance Share Award granted to an employee beyond the minimum restriction periods
set forth in Section 7(d), Section 8(a) and Section 11(a), respectively, or accelerate the exercisability or vesting
of unvested Stock Options which in the aggregate, when combined with the aggregate number of shares of Stock issued pursuant to
Section 9, exceed ten percent (10%) of the maximum number of shares of stock reserved and available for issuance under
the Plan pursuant to Section 3(a);

 

(vi) subject
to the provisions of Section 5(a)(ii), to extend at any time the period in which Stock Options may be exercised; and

 

(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.

 

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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. The Administrator, in its discretion, may delegate to the Chief Executive Officer of the Company
all or part of the Administrator’s authority and duties with respect to the granting of Awards at Fair Market Value, to individuals
who are not subject to the reporting and other provisions of Section 16 of the Exchange Act or “covered employees”
within the meaning of Section 162(m) of the Code. Any such delegation by the Administrator shall include a limitation as to
the amount of Awards that may be granted during the period of the delegation and shall contain guidelines as to the determination
of the exercise price of any Stock Option or Stock Appreciation Right, the conversion ratio or price of other Awards 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) Indemnification.
Neither the Board nor the Committee, nor any member of either or any delegatee thereof, shall be liable for any act, omission,
interpretation, construction or determination made in good faith in connection with the Plan, and the members of the Board and
the Committee (and any delegatee 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 organizational documents 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.

 

3.    STOCK ISSUABLE
UNDER THE PLAN; MERGERS; SUBSTITUTION

 

(a)(1) Stock Issuable.
Subject to adjustment as provided in Section 3(b), the last paragraph of this Section 3(a) and any other applicable provisions
hereof, the maximum number of shares of Stock reserved and available for issuance under the Plan shall be Two Million Ninety-Eight
Thousand (2,098,000) shares of Stock, which includes (i) the 150,000 shares of Stock originally reserved and available for issuance
under the Plan, plus (ii) 48,000 shares of Stock previously added through March 31, 2016 in accordance with the evergreen provision
of Section 3(a)(2) of the Plan, plus (iii) an additional 100,000 shares of Stock reserved and available for issuance under the
Plan in accordance with an amendment dated as of May 26, 2016, plus (iv) an additional 200,000 shares of Stock reserved and available
for issuance under the Plan in accordance with an amendment dated as of April 26, 2017, plus (v) an additional 1,600,000 shares
of Stock reserved and available for issuance under the Plan in accordance with an amendment dated as of May 23, 2018. To the extent
an Award (including any Adjustment Awards) expires or terminates or is surrendered or forfeited (other than by exercise), in whole
or in part, the shares subject to such Award or portion thereof so forfeited, expired, terminated or surrendered again will become
available for future grant or sale under the Plan. To the extent an Award (including any Adjustment Awards) expires or terminates
or is surrendered or forfeited (other than by exercise), in whole or in part, the shares subject to such Award or portion thereof
so forfeited, expired, terminated or surrendered again will become available for future grant or sale under the Plan. Should the
exercise price of an Option be paid with shares underlying such Option, then the authorized reserve of shares under the Plan shall
be reduced by the gross number of shares for which that Option is exercised, and not by the net number of shares issued under the
exercised Option. If shares otherwise issuable under the Plan are withheld by the Company in satisfaction of the withholding taxes
incurred in connection with an Award, then the number of shares available for issuance under the Plan shall be reduced by the gross
number of shares issuable under the Award, calculated in each instance prior to any such share withholding. In addition, upon exercise
of Stock Appreciation Rights, the gross number of shares exercised shall be deducted from the total number of shares remaining
available for issuance under the Plan. Shares of Stock may be issued up to such maximum number pursuant to any type or types of
Award; provided, however, that Stock Options or Stock Appreciation Rights with respect to no more than 1,000,000 shares of Stock
may be granted to any one individual grantee during any one calendar year period. The shares available for issuance under the Plan
may be authorized but unissued shares of Stock or shares of Stock reacquired by the Company and held in its treasury.

 

(a)(2) Automatic
Share Reserve Increase. [Reserved].

 

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(a)(3) Adjustment
Awards Increase. [Reserved.]

 

(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 a different number or kind
of 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 Unrestricted Stock Awards, Restricted Stock Awards or Performance Share Awards,
(ii) the number of Stock Options or Stock Appreciation Rights that can be granted to any one individual grantee and the maximum
number of shares that may be granted under a Performance-based Award, (iii) the number and kind of shares or other securities
subject to any then outstanding Awards under the Plan, (iv) the repurchase price per share subject to each outstanding Restricted
Stock Award, and (v) the 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 Stock Options
and Stock Appreciation Rights) as to which such Stock Options and Stock Appreciation Rights remain exercisable in a manner that
will trigger tax under Section 409A. 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.

 

The Administrator
shall also adjust the number of shares subject to outstanding Awards and the exercise price and the terms of outstanding Awards
to take into consideration material changes in accounting practices or principles, extraordinary dividends, acquisitions or dispositions
of stock or property or any other event if it is determined by the Administrator that such adjustment is appropriate to avoid distortion
in the operation of the Plan, provided that no such adjustment shall be made in the case of an Incentive Stock Option, without
the consent of the grantee, if it would constitute a modification, extension or renewal of the Option within the meaning of Section 424(h)
of the Code.

 

(c) Mergers and
Other Transactions. In the case of and subject to the consummation of (i) the dissolution or liquidation of the Company,
(ii) the sale of all or substantially all of the assets of the Company on a consolidated basis to an unrelated person or entity,
(iii) a merger, reorganization or consolidation in which the outstanding shares of Stock are converted into or exchanged for
a different kind of securities of the successor entity and the holders of the Company’s outstanding voting power immediately
prior to such transaction do not own a majority of the outstanding voting power of the successor entity immediately upon completion
of such transaction, or (iv) the sale of all of the Stock of the Company to an unrelated person or entity (in each case, a
“Sale Event”), all Options and Stock Appreciation Rights that are not exercisable immediately prior to the effective
time of the Sale Event shall become fully exercisable as of the effective time of the Sale Event and all other Awards with conditions
and restrictions relating solely to the passage of time and continued employment shall become fully vested and nonforfeitable as
of the effective time of the Sale Event, except as the Administrator may otherwise specify with respect to particular Awards. Upon
the effective time of the Sale Event, the Plan and all outstanding Awards granted hereunder shall terminate, unless provision is
made in connection with the Sale Event in the sole discretion of the parties thereto for 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 (after taking into account any acceleration hereunder). In the event of such termination, 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 held by such grantee, including those that will become exercisable
upon the consummation of the Sale Event; provided, however, that the exercise of Options and Stock Appreciation Rights not exercisable
prior to the Sale Event shall be subject to the consummation of the Sale Event.

 

Notwithstanding anything
to the contrary in this Section 3(c), in the event of a Sale Event pursuant to which holders of the Stock of the Company will
receive upon consummation thereof a cash payment for each share surrendered in the Sale Event, the Company shall have the right,
but not the obligation, to make or provide for a cash payment 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 value as determined by the Administrator
of the consideration payable per share of Stock pursuant to the Sale Event (the “Sale Price”) times 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.

 

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(d) Substitute
Awards. The Administrator may grant Awards under the Plan in substitution for stock and stock based awards held by employees,
directors or other key persons of another corporation in connection with the merger or consolidation of the employing corporation
with the Company or a Subsidiary or the acquisition by the Company or a Subsidiary of property or stock of the employing corporation.
The Administrator may direct that the substitute awards be granted on such terms and conditions as the Administrator considers
appropriate in the circumstances. Any substitute Awards granted under the Plan shall not count against the share limitation set
forth in Section 3(a).

 

4.    ELIGIBILITY

 

Grantees under the
Plan will be such full or part-time officers and other employees, Non-Employee Directors and key persons (including consultants
and prospective employees) of the Company and its Subsidiaries as are selected from time to time by the Administrator in its sole
discretion.

 

Additionally, the
Company is authorized to issue Awards (“Adjustment Awards”) under the Plan in connection with the equitable adjustment
by HBIO of certain stock options, deferred stock awards, restricted stock awards, performance share awards and other equity-based
awards previously granted by HBIO (collectively, the “HBIO Awards”) to reflect the Company stock dividend on HBIO Awards.
Notwithstanding any other provision of the Plan to the contrary, the number of shares subject to an Adjustment Award and other
terms and conditions relating thereto, including, but not limited to option exercise prices, shall be equitable and determined
by the Committee (a) in accordance with the provisions and formulas for the equity adjustment of HBIO Awards that are set forth
in the Separate and Distribution Agreement entered into by and between the Company and HBIO; and (b) in an amount that will not
cause the aggregate number of shares of Stock available for grant and issuance under the Plan (as set forth in Section 3(a)(3)
hereof) to be exceeded.

 

Notwithstanding anything
to the contrary contained herein or in any Award (including any Adjustment Award), for purposes of exercisability, vesting and
the post-termination exercise periods applicable to the Adjustment Awards, continued employment with, or service to, HBIO (or its
subsidiaries) or the Company (or its subsidiaries) is considered to be continued employment with, and service to, the other, provided
that the failure to exercise Incentive Stock Options within the applicable deadline following any separation from service from
the Company shall cause such options to be treated thereafter as Non-Qualified Stock Options.

 

5.    STOCK OPTIONS

 

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.

 

(a) Stock Options
Granted to Employees and Key Persons. The Administrator in its discretion may grant Stock Options to eligible employees and
key persons of the Company or any Subsidiary. Stock Options granted pursuant to this Section 5(a) 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.

 

(i) Exercise
Price. The exercise price per share for the Stock covered by a Stock Option granted pursuant to this Section 5(a) 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. If an employee 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
and an Incentive Stock Option is granted to such employee, the option price of such Incentive Stock Option shall be not less than
110 percent of the Fair Market Value on the grant date.

 

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(ii) Option
Term. The term of each Stock Option shall be fixed by the Administrator, but no Stock Option shall be exercisable more than
10 years after the date the Stock Option is granted. If an employee 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 and an Incentive Stock Option is granted to such employee, the term of such Stock Option shall
be no more than five years from the date of grant.

 

(iii)
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. Subject to Section 2(b)(v), 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.

 

(iv) Method
of Exercise. Stock Options may be exercised in whole or in part, by giving written 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 to the
extent provided in the Option Award agreement:

 

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

 

(2) 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 have been beneficially owned by the optionee for at least six months and are not then subject to restrictions under any Company
plan. Such surrendered shares shall be valued at Fair Market Value on the exercise date; or

 

(3) 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 Administrator shall prescribe as a condition of such payment
procedure.

 

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 delivery of certificates representing 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
Option Award agreement or applicable provisions of laws (including the satisfaction of any withholding taxes that the Company 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.

 

(v) 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.

 

    	 	7	 

     

    

 

(b) Stock Options
Granted to Non-Employee Directors.

 

(i) Automatic
and Other Grant of Options.

 

(1) [Reserved.].

 

(2) [Reserved.].

 

(3) The
exercise price per share for the Stock covered by a Stock Option granted under this Section 5(b) shall be equal to the Fair
Market Value of the Stock on the date the Stock Option is granted.

 

(4) The
Administrator, in its discretion, may also grant additional Non-Qualified Stock Options to Non-Employee Directors. Any such grant
may vary among individual Non-Employee Directors.

 

(ii) Exercise;
Termination.

 

(1) Unless
otherwise determined by the Administrator, an Option granted under Section 5(b) shall vest and be exercisable as to all of
the shares of Stock covered thereby as of the first anniversary of the grant date. An Option issued under this Section 5(b)
shall not be exercisable after the expiration of ten years from the date of grant.

 

(2) Options
granted under this Section 5(b) may be exercised only by written notice to the Company specifying the number of shares to
be purchased. Payment of the full purchase price of the shares to be purchased may be made by one or more of the methods specified
in Section 5(a)(iv). 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.

 

(c) Non-transferability
of Options. No Stock Option shall be transferable by the optionee otherwise than by will or by the laws of descent and distribution
and all Stock Options shall be exercisable, during the optionee’s lifetime, only by the optionee, or by the optionee’s
legal representative or guardian in the event of the optionee’s incapacity. Notwithstanding the foregoing, the Administrator,
in its sole discretion, may provide in the Award agreement regarding a given Option that the optionee may transfer his Non-Qualified
Stock Options to members of his immediate family, 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 Option.

 

6.    STOCK APPRECIATION
RIGHTS.

 

(a) Nature of Stock
Appreciation Rights. A Stock Appreciation Right is an Award entitling the recipient to receive shares of Stock having a value
equal to the excess of the Fair Market Value of the Stock on the date of exercise over the exercise price Stock Appreciation Right,
which price shall not be less than 100 percent of the Fair Market Value of the Stock on the date of grant multiplied by the number
of shares of Stock with respect to which the Stock Appreciation Right shall have been exercised.

 

(b) 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.

 

(c) Terms and Conditions
of Stock Appreciation Rights. Stock Appreciation Rights shall be subject to such terms and conditions as shall be determined
from time to time by the Administrator; provided that during the grantee’s lifetime all Stock Appreciation Rights shall be
exercisable only by the grantee or the grantee’s legal representative.

 

(d) Stock Appreciation
Rights Term. The term of each Stock Appreciation Right shall be fixed by the Administrator, but no Stock Appreciation
Right shall be exercisable more than ten years after the date the Stock Appreciation Right is granted.

 

    	 	8	 

     

    

 

7.    RESTRICTED
STOCK AWARDS

 

(a) Nature of Restricted
Stock Awards. A Restricted Stock Award is an Award entitling the recipient to acquire, at such purchase price as determined
by the Administrator, shares of Stock subject to such restrictions and conditions as the Administrator may determine at the time
of grant (“Restricted Stock”). Conditions may be based on continuing employment (or other service relationship) and/or
achievement of pre-established performance goals and objectives. The grant of a Restricted Stock Award is contingent on the grantee
executing the Restricted Stock Award agreement. The terms and conditions of each such agreement shall be determined by the Administrator,
and such terms and conditions may differ among individual Awards and grantees.

 

(b) Rights as a
Stockholder. Upon execution of a written instrument setting forth 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 Stock, subject to
such conditions contained in the written instrument evidencing the Restricted Stock Award. Unless the Administrator shall otherwise
determine, (i) uncertificated Restricted Stock 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 Stock are vested as provided in Section 7(d)
below, and (ii) certificated Restricted Stock shall remain in the possession of the Company until such Restricted Stock is
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 a stock power endorsed in blank.

 

(c) Restrictions.
Restricted Stock may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed of except as specifically
provided herein or in the Restricted Stock Award agreement. If a grantee’s employment (or other service relationship) with
the Company and its Subsidiaries terminates for any reason, any Restricted Stock that has 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 unvested Restricted Stock that are represented by physical certificates, a grantee shall surrender such certificates to the
Company upon request without consideration.

 

(d) Vesting of
Restricted Stock. 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 Stock and the Company’s
right of repurchase or forfeiture shall lapse. Notwithstanding the foregoing, in the event that any such Restricted Stock granted
to an employee shall have a performance-based goal, the restriction period with respect to such shares shall not be less than one
year, and in the event any such Restricted Stock granted to an employee shall have a time-based restriction, the restriction period
with respect to such shares shall not be less than three years; provided, however, that Restricted Stock with a time-based restriction
may become vested incrementally over such three-year period. The minimum vesting requirements set forth in the foregoing sentence
will not apply to Restricted Stock granted to a Non-Employee Director. 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 Stock and shall be deemed “vested.” Except as may otherwise be provided by the Administrator
either in the Award agreement or, subject to Section 17 below, in writing after the Award agreement is issued, a grantee’s
rights in any shares of Restricted Stock that have not vested shall automatically terminate upon the grantee’s termination
of employment (or other service relationship) with the Company and its Subsidiaries and such shares shall be subject to the Company’s
right of repurchase as provided in Section 7(c) above.

 

(e) Waiver, Deferral
and Reinvestment of Dividends. The Restricted Stock Award agreement may require or permit the immediate payment, waiver, deferral
or investment of dividends paid on the Restricted Stock.

 

    	 	9	 

     

    

 

8.    DEFERRED STOCK
AWARDS

 

(a) Nature of Deferred
Stock Awards. A Deferred Stock Award is an Award of phantom stock units to a grantee, subject to 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. The grant of a Deferred Stock Award is contingent on the
grantee executing the Deferred Stock Award agreement. The terms and conditions of each such agreement shall be determined by the
Administrator, and such terms and conditions may differ among individual Awards and grantees. Notwithstanding the foregoing, in
the event that any such Deferred Stock Award granted to an employee shall have a performance-based goal, the restriction period
with respect to such award shall not be less than one year, and in the event any such Deferred Stock Award granted to an employee
shall have a time-based restriction, the restriction period with respect to such award shall not be less than three years; provided,
however, that any such Deferred Stock Award with a time-based restriction may become vested incrementally over such three-year
period. The minimum vesting requirements set forth in the foregoing sentence will not apply to Deferred Stock Awards granted to
Non-Employee Directors. At the end of the deferral period, the Deferred Stock Award, to the extent vested, shall be paid to the
grantee in the form of shares of Stock. To the extent that a Deferred Stock Award is subject to Section 409A, it may contain
such additional terms and conditions as the Administrator shall determine in its sole discretion in order for such Award to comply
with the requirements of Section 409A.

 

(b) Election to
Receive Deferred Stock Awards in Lieu of Compensation. The Administrator may, in its sole discretion, permit a grantee to elect
to receive a portion of the cash compensation or Restricted Stock Award otherwise due to such grantee in the form of a Deferred
Stock Award. 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 phantom 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.

 

(c) Rights as a
Stockholder. During the deferral period, a grantee shall have no rights as a stockholder; provided, however, that the grantee
may be credited with Dividend Equivalent Rights with respect to the phantom stock units underlying his Deferred Stock Award, subject
to such terms and conditions as the Administrator may determine.

 

(d) Restrictions.
A Deferred Stock Award may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed of during the deferral
period.

 

(e) Termination.
Except as may otherwise be provided by the Administrator either in the Award agreement or, subject to Section 17 below, in
writing after the Award agreement is issued, a grantee’s right in all Deferred Stock Awards that have not vested shall automatically
terminate upon the grantee’s termination of employment (or cessation of service relationship) with the Company and its Subsidiaries
for any reason.

 

9.    UNRESTRICTED
STOCK AWARDS

 

The Administrator
may, in its sole discretion, grant (or sell at par value or such higher purchase price determined by the Administrator) an Unrestricted
Stock Award to any grantee pursuant to which such grantee may receive shares of Stock free of any restrictions (“Unrestricted
Stock”) 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. The aggregate number of shares of Stock issuable pursuant to this Section 9,
when combined with the number of shares of underlying unvested Stock Options accelerated pursuant to Section 2(b)(v) other
than by reason of, or in connection with, any death, disability, retirement, employment termination (without cause or by the employee
for good reason), Sale Event or Change of Control, is limited to ten percent (10%) of the maximum number of shares of Stock
reserved and available for issuance under the Plan pursuant to Section 3(a).

 

    	 	10	 

     

    

 

10.    CASH-BASED
AWARDS

 

The Administrator
may, in its sole discretion, grant Cash-Based Awards to any grantee in such number or amount and upon such terms, and subject to
such conditions, as the Administrator shall determine at the time of grant. 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, if such Award is deemed deferred compensation,
Section 15 hereof, and may be made in cash or in shares of Stock, as the Administrator determines.

 

11.    PERFORMANCE
SHARE AWARDS

 

(a) Nature of Performance
Share Awards. A Performance Share Award is an Award entitling the recipient to acquire shares of Stock upon the attainment
of specified performance goals. The Administrator may make Performance Share Awards independent of or in connection with the granting
of any other Award under the Plan. The Administrator in its sole discretion shall determine whether and to whom Performance Share
Awards shall be made, the performance goals, the periods during which performance is to be measured, and all other limitations
and conditions. Notwithstanding the foregoing, any Performance Share Award granted to an employee shall have a restriction period
of not less than one year. The minimum vesting requirements set forth in the foregoing sentence will not apply to Performance Share
Awards granted to Non-Employee Directors.

 

(b) Rights as a
Stockholder. A grantee receiving a Performance Share Award shall have the rights of a stockholder only as to shares actually
received by the grantee under the Plan and not with respect to shares subject to the Award but not actually received by the grantee.
A grantee shall be entitled to receive a stock certificate evidencing the acquisition of shares of Stock under a Performance Share
Award only upon satisfaction of all conditions specified in the Performance Share Award agreement (or in a performance plan adopted
by the Administrator).

 

(c) Termination.
Except as may otherwise be provided by the Administrator either in the Award agreement or, subject to Section 17 below, in
writing after the Award agreement is issued, a grantee’s rights in all Performance Share Awards shall automatically terminate
upon the grantee’s termination of employment (or cessation of service relationship) with the Company and its Subsidiaries
for any reason.

 

12.    PERFORMANCE-BASED
AWARDS TO COVERED EMPLOYEES

 

Notwithstanding anything
to the contrary contained herein, if any Restricted Stock Award, Deferred Stock Award, Cash-Based Award or Performance Share Award
granted to a Covered Employee is intended to qualify as “Performance-based Compensation” under Section 162(m)
of the Code and the regulations promulgated thereunder (a “Performance-Based Award”), such Award shall comply
with the provisions set forth below:

 

(a) Performance
Criteria. The Administrator shall define in an objective fashion the manner of calculating the Performance Criteria it selects
to use for any Performance Cycle. Depending on the Performance Criteria used to establish such Performance Goals, the Performance
Goals may be expressed in terms of overall Company performance or the performance of a division, business unit, or an individual.
The Administrator, in its discretion, may adjust or modify the calculation of Performance Goals for such Performance Cycle in order
to prevent dilution or enlargement of the rights of an individual (x) in the event of, or in anticipation of, any unusual
or extraordinary corporate item, transaction, event or development, (y) in recognition of, or in anticipation of, any either
unusual or nonrecurring events affecting the Company, or the financial statements of the Company, or (z) in response to, or
in anticipation of, changes in applicable laws, regulations, accounting principles, or business conditions provided however, that
the Administrator may not exercise such discretion in a manner that would increase the Performance-Based Award granted to a Covered
Employee. The performance criteria used in performance goals governing Performance-based Awards granted to Covered Employees may
include any or all of the following: (i) return on equity, assets, capital or investment; (ii) pre-tax or after-tax profit
levels; (iii) cash flow, funds from operations or similar measure; (iv) total shareholder return; (v) changes in
the market price of the Stock; (vi) revenues, sales or market share; (vii) net income (loss) or earnings per share; (viii) expense
margins or operating efficiency (including budgeted spending limits) or (ix) project development milestones, any of which
may be measured either in absolute terms or as compared to any incremental increase or as compared to results of a peer group and,
for financial measures, may be based on numbers calculated in accordance with U.S. generally accepted accounting principles or
on an as adjusted basis.

 

    	 	11	 

     

    

 

(b) Grant of Performance-based
Awards. With respect to each Performance-based Award granted to a Covered Employee, the Committee shall select, within the
first 90 days of a Performance Cycle (or, if shorter, within the maximum period allowed under Section 162(m) of the Code)
the performance criteria for such grant, and the achievement targets with respect to each performance criterion (including a threshold
level of performance below which no amount will become payable with respect to such Award). Each Performance-based Award will specify
the amount payable, or the formula for determining the amount payable, upon achievement of the various applicable performance targets.
The performance criteria established by the Committee may be (but need not be) different for each Performance Cycle and different
goals may be applicable to Performance-based Awards to different Covered Employees.

 

(c) Payment of
Performance-based Awards. Following the completion of a Performance Cycle, the Committee shall meet to review and certify in
writing whether, and to what extent, the performance criteria for the Performance Cycle have been achieved and, if so, to also
calculate and certify in writing the amount of the Performance-based Awards earned for the Performance Cycle. The Committee shall
then determine the actual size of each Covered Employee’s Performance-based Award, and, in doing so, may reduce or eliminate
the amount of the Performance-based Award for a Covered Employee if, in its sole judgment, such reduction or elimination is appropriate.

 

(d) Maximum Award
Payable. The maximum Performance-based Award payable to any one Covered Employee under the Plan for a Performance Cycle is
1,000,000 Shares (subject to adjustment as provided in Section 3(b) hereof) or $2,000,000 in the case of a Performance-based
Award that is a Cash-Based Award; provided, however, that such limits shall not otherwise limit the Administrator’s ability
to grant awards not intended to qualify as Performance-based Awards.

 

13.    DIVIDEND
EQUIVALENT RIGHTS

 

(a) Dividend Equivalent
Rights. 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 and held by the grantee. A Dividend Equivalent Right may be granted hereunder to any grantee only as a component
of Unrestricted Stock Awards, Restricted Stock Awards, Deferred Stock Awards or Performance Share Awards. The terms and conditions
of Dividend Equivalent Rights shall be specified in the Award agreement. 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 another Award may provide that such Dividend Equivalent Right shall be settled upon exercise, 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. A Dividend Equivalent Right granted as a component of another Award
may also contain terms and conditions different from such other award.

 

(b) Interest Equivalents.
Any Award under this Plan that is settled in whole or in part in cash on a deferred basis may provide in the grant for interest
equivalents to be credited with respect to such cash payment. Interest equivalents may be compounded and shall be paid upon such
terms and conditions as may be specified by the grant.

 

(c) Termination.
Except as may otherwise be provided by the Administrator either in the Award agreement or, subject to Section 17 below, in
writing after the Award agreement is issued, a grantee’s rights in all Dividend Equivalent Rights or interest equivalents
shall automatically terminate upon the grantee’s termination of employment (or cessation of service relationship) with the
Company and its Subsidiaries for any reason.

 

    	 	12	 

     

    

 

14.    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. Subject to approval by the Administrator, a grantee may elect to have the Company’s minimum required tax withholding
obligation satisfied, in whole or in part, by (i) authorizing the Company to withhold 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, or (ii) transferring to the Company shares of Stock owned by the grantee with an aggregate Fair
Market Value (as of the date the withholding is effected) that would satisfy the withholding amount due.

 

15.    SECTION 409A
AWARDS.

 

To the extent that
any Award is determined to constitute “nonqualified deferred compensation” within the meaning of Section 409A
(a “409A Award”), the Award shall be subject to such additional rules and requirements as 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 such Award may not be accelerated except to the extent
permitted by Section 409A.

 

16.    TRANSFER,
LEAVE OF ABSENCE, ETC.

 

For purposes of the
Plan, the following events shall not be deemed a termination of employment:

 

(a) a transfer to
the employment of the Company from a Subsidiary or from the Company to a Subsidiary, or from one Subsidiary to another; or

 

(b) an approved leave
of absence for military service or sickness, or for any other purpose approved by the Company, if the employee’s right to
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.

 

17.    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 adversely affect rights under any outstanding
Award without the holder’s consent. Except as provided in Section 3(b) or 3(c), in no event may the Administrator exercise
its discretion to reduce the exercise price of outstanding Stock Options or Stock Appreciation Rights or effect repricing through
cancellation and regrants or by exchanging a Stock Option or Stock Appreciation Right for any other Award, without stockholder
approval. If and 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 or to ensure that compensation earned under Awards qualifies
as performance-based compensation under Section 162(m) of the Code, if and to the extent intended to so qualify, and to the
extent required under the applicable rules of The NASDAQ Stock Market, or such other securities exchange or market system on which
the Stock is then principally listed, Plan amendments shall be subject to approval by the Company stockholders entitled to vote
at a meeting of stockholders. Nothing in this Section 17 shall limit the Administrator’s authority to take any action
permitted pursuant to Section 3(c).

 

    	 	13	 

     

    

 

18.    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.

 

19.    CHANGE OF
CONTROL PROVISIONS

 

Upon the occurrence
of a Change of Control as defined in this Section 19:

 

(a) Except as otherwise
provided in the applicable Award agreement, each outstanding Stock Option and Stock Appreciation Right shall automatically become
fully exercisable.

 

(b) Except as otherwise
provided in the applicable Award Agreement, conditions and restrictions on each outstanding Restricted Stock Award, Deferred Stock
Award and Performance Share Award which relate solely to the passage of time and continued employment will be removed. Performance
or other conditions (other than conditions and restrictions relating solely to the passage of time and continued employment) will
continue to apply unless otherwise provided in the applicable Award agreement.

 

(c) “Change
of Control” shall mean the occurrence of any one of the following events:

 

(i) any
“Person,” as such term is used in Sections 13(d) and 14(d) of the Act (other than the Parent, the Company, any of its
Subsidiaries, or any trustee, fiduciary or other person or entity holding securities under any employee benefit plan or trust of
the Company or any of its Subsidiaries), together with all “affiliates” and “associates” (as such terms
are defined in Rule 12b-2 under the Exchange Act) of such person, shall become the “beneficial owner” (as such term
is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing twenty five
percent (25%) or more of the combined voting power of the Company’s then outstanding securities having the right to vote
in an election of the Company’s Board of Directors (“Voting Securities”) (in such case other than as a
result of an acquisition of securities directly from the Company); or

 

(ii) persons
who, as of the Effective Date, constitute the Company’s Board of Directors (the “Incumbent Directors”)
cease for any reason, including, without limitation, as a result of a tender offer, proxy contest, merger or similar transaction,
to constitute at least a majority of the Board; provided that any person becoming a director of the Company subsequent to the Effective
Date shall be considered an Incumbent Director if such person’s election was approved by or such person was nominated for
election by either (A) a vote of at least a majority of the Incumbent Directors or (B) a vote of at least a majority
of the Incumbent Directors who are members of a nominating committee comprised, in the majority, of Incumbent Directors; but provided
further, that any such person whose initial assumption of office is in connection with an actual or threatened election contest
relating to the election of members of the Board of Directors or other actual or threatened solicitation of proxies or consents
by or on behalf of a Person other than the Board, including by reason of agreement intended to avoid or settle any such actual
or threatened contest or solicitation, shall not be considered an Incumbent Director; or

 

(iii)
the consummation of a consolidation, merger or consolidation or sale or other disposition of all or substantially all of the assets
of the Company (a “Corporate Transaction”); excluding, however, a Corporate Transaction in which the stockholders
of the Company immediately prior to the Corporate Transaction, would, immediately after the Corporate Transaction, beneficially
own (as such term is defined in Rule 13d-3 under the Act), directly or indirectly, shares representing in the aggregate more than
50 percent of the voting shares of the corporation issuing cash or securities in the Corporate Transaction (or of its ultimate
parent corporation, if any); or

 

    	 	14	 

     

    

 

(iv) the
approval by the stockholders of any plan or proposal for the liquidation or dissolution of the Company.

 

Notwithstanding the
foregoing, a “Change of Control” shall not be deemed to have occurred for purposes of the foregoing clause (i) solely
as the result of an acquisition of securities by the Company which, by reducing the number of shares of Voting Securities outstanding,
increases the proportionate number of shares of Voting Securities beneficially owned by any person to 25 percent or more of the
combined voting power of all then outstanding Voting Securities; provided, however, that if any person referred to in this
sentence shall thereafter become the beneficial owner of any additional shares of Voting Securities (other than pursuant to a stock
split, stock dividend, or similar transaction or as a result of an acquisition of securities directly from the Company) and immediately
thereafter beneficially owns 25 percent or more of the combined voting power of all then outstanding Voting Securities, then a
“Change of Control” shall be deemed to have occurred for purposes of the foregoing clause (i).

 

20.    GENERAL PROVISIONS

 

(a) No Distribution;
Compliance with Legal Requirements. 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.

 

No shares of Stock
shall be issued pursuant to an Award until all applicable securities law and other legal and stock exchange or similar requirements
have been satisfied. The Administrator may require the placing of such stop-orders and restrictive legends on certificates for
Stock and Awards as it deems appropriate.

 

The Plan, the granting
and exercising of Awards hereunder, and any obligations of the Company under the Plan, shall be subject to all applicable federal,
state and foreign country laws, rules and regulations, and to such approvals by any regulatory or governmental agency as may be
required, and to any rules or regulations of any exchange on which the Stock is listed. The Company, in its discretion, may postpone
the granting and exercising of Awards, the issuance or delivery of Stock under any Award or any other action permitted under the
Plan to permit the Company, with reasonable diligence, to complete such stock exchange listing or registration or qualification
of such Stock or other required action under any federal, state or foreign country law, rule or regulation and may require any
grantee to make such representations and furnish such information as it may consider appropriate in connection with the issuance
or delivery of Stock in compliance with applicable laws, rules and regulations. The Company shall not be obligated by virtue of
any provision of the Plan to recognize the exercise of any Award or to otherwise sell or issue Stock in violation of any such laws,
rules or regulations, and any postponement of the exercise or settlement of any Award under this provision shall not extend the
term of such Awards. Neither the Company nor its directors or officers shall have any obligation or liability to a grantee with
respect to any Award (or Stock issuable thereunder) that shall lapse because of such postponement.

 

(b) Delivery of
Stock Certificates. 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 certificates evidencing shares of Stock
pursuant to the exercise 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 of such certificates 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. All Stock certificates delivered 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 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.

 

    	 	15	 

     

    

 

(c) Stockholder
Rights. Until Stock is deemed delivered in accordance with Section 20(b), and subject to the provisions of the applicable
Award contained in the Plan and in an agreement evidencing such Award, 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 or any permitted transferee or designated beneficiary 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 such Company’s insider trading policy,
as in effect from time to time.

 

(f) Forfeiture
of Awards under Sarbanes-Oxley Act. If the Company is required to prepare an accounting restatement due to the material noncompliance
of the Company, as a result of misconduct, with any financial reporting requirement under the securities laws, then, to the extent
required by law, any grantee who is one of the individuals subject to automatic forfeiture under Section 304 of the Sarbanes-Oxley
Act of 2002 shall reimburse the Company for the amount of any Award received by such individual under the Plan during the 12-month
period following the first public issuance or filing with the United States Securities and Exchange Commission, as the case may
be, of the financial document embodying such financial reporting requirement.

 

(g) Designation
of Beneficiary. Each grantee to whom an Award has been made under the Plan may designate a beneficiary or beneficiaries to
exercise any Award 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.

 

(h) No Constraint
on Corporate Action. Nothing in this Plan shall be construed (i) to limit, impair or otherwise affect the Company’s
right or power to make adjustments, reclassifications, reorganizations or changes of its capital or business structure, or to merge
or consolidate, or dissolve, liquidate, sell or transfer all or any part of its business or assets, or (ii) to limit the right
or power of the Company, or any Subsidiary, to take any action which such entity deems to be necessary or appropriate.

 

21.    EFFECTIVE
DATE OF PLAN

 

This Plan shall become
effective on the later of the approval by the holders of a majority of the votes cast at a meeting of stockholders at which a quorum
is present or by written consent of the stockholders, or the Distribution Date immediately after the Distribution (the “Effective
Date”). Subject to such approval by the stockholders and to the requirement that no Stock may be issued hereunder prior to
such approval, Stock Options and other Awards may be granted hereunder on and after adoption of this Plan by the Board. No Incentive
Stock Options may be granted under the Plan after the 10-year anniversary of the Effective Date or of the most recent prior date
on which the Plan was approved by the Board (provided that the Plan was approved by stockholders within one year of such date)
and no other Award may be granted under the Plan after the 10-year anniversary of the most recent prior date on which the Plan
was approved by stockholders.  

 

    	 	16	 

     

    

 

22.    GOVERNING
LAW

 

This Plan and all
Awards and actions taken hereunder shall be governed by, and construed in accordance with, the laws of the State of Delaware, applied
without regard to conflict of law principles.

 

DATE APPROVED BY BOARD OF DIRECTORS:   October 11,
2013 DATE APPROVED BY STOCKHOLDERS:   October 31, 2013

 

DATE FIRST AMENDMENT TO THE PLAN APPROVED BY BOARD OF DIRECTORS:   March 28,
2016

 

DATES SECOND AMENDMENT TO THE BIOSTAGE, INC. 2013 EQUITY INCENTIVE
PLAN APPROVED: (I) BY BOARD OF DIRECTORS:   March 28, 2016 AND (II) BY STOCKHOLDERS:   May 26,
2016

 

DATES THIRD AMENDMENT TO THE BIOSTAGE, INC. 2013 EQUITY INCENTIVE
PLAN APPROVED: (I) BY BOARD OF DIRECTORS:   March 7, 2017 AND (II) BY STOCKHOLDERS:   April 26,
2017

 

DATES FOURTH AMENDMENT TO THE BIOSTAGE, INC. 2013 EQUITY INCENTIVE
PLAN APPROVED: (I) BY BOARD OF DIRECTORS:   April 8, 2018 AND (II) BY STOCKHOLDERS:   May 23,
2018

 

DATE FIFTH AMENDMENT TO BIOSTAGE, INC. 2013 EQUITY INCENTIVE
PLAN APPROVED BY BOARD OF DIRECTORS: MAY 29, 2018.

 

    	 	17EXHIBIT 10.14

 

Director Compensation Arrangements

 

Annual compensation to consist of cash fees
of $20,000 to be paid in quarterly increments, and a grant of stock options with a value of $25,000 at the grant date, which shall
be the fifth business day following the Corporation’s annual stockholders meeting, with all such awards to vest in full in
equity quarterly increments over a period of one year from the grant date.

 

In addition, all non-employee directors
shall be reimbursed for their expenses incurred in connection with attending Board and Committee meetings.

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