Document:

Exhibit 4.6

 Exhibit 4.6 
  

THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO SUCH SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED. 
  
 LUNA INNOVATIONS INCORPORATED 
  
 WARRANT TO PURCHASE COMMON STOCK 
  

			
	No. CW-    	 	______________, ______

  
 Void After
                     
  
 THIS CERTIFIES THAT, for value received,
                                        ,
or assigns (the “Holder”), is entitled to subscribe for and purchase at the Exercise Price (defined below) from LUNA INNOVATIONS INCORPORATED, a Delaware
corporation, with its principal office at 10 South Jefferson Street, Suite 130, Roanoke, Virginia 24011 (the “Company”) up to that number of Exercise Shares of the Common Stock (as defined below) of the Company determined in
accordance with the terms hereof. 
  
 1.
DEFINITIONS. As used herein, the following terms shall have the following respective meanings: 
  
 (a) “Common Stock” shall mean the shares of the Class B Common Stock, or, if applicable, upon
conversion, shares of the Company’s Common Stock. 
  
 (b) “Exercise Period” shall mean the period commencing with the date hereof and ending ten (10) years from the date of this Warrant. 
  
 (c) “Exercise Price” shall mean
$             per share, subject to adjustment pursuant to Section 5 below. 
  
 (d) “Exercise Shares” shall mean the
[            ] shares of Common Stock issuable upon exercise of this Warrant, subject to adjustment pursuant to the terms herein, including but not limited to adjustment pursuant to
Section 5 below. 
  
 2. EXERCISE
OF WARRANT. The rights represented by this Warrant may be exercised in whole or in part at any time during the Exercise Period, by delivery of the following to the Company at its address set forth
above (or at such other address as it may designate by notice in writing to the Holder): 
  
 (a) An executed Notice of Exercise in the form attached hereto; 
  
 (b) Payment of the Exercise Price either (i) in cash or by check, or (ii) by cancellation
of indebtedness; and 
  
 (c) This Warrant.

  
 Upon the exercise of the rights represented by this Warrant, a
certificate or certificates for the Exercise Shares so purchased, registered in the name of the Holder or persons affiliated with the Holder, if the Holder so designates, shall be issued and delivered to the Holder within a reasonable time after the
rights represented by this Warrant shall have been so exercised. 

 The person in whose name any certificate or certificates for Exercise Shares are to be issued upon
exercise of this Warrant shall be deemed to have become the holder of record of such shares on the date on which this Warrant was surrendered and payment of the Exercise Price was made, irrespective of the date of delivery of such certificate or
certificates, except that, if the date of such surrender and payment is a date when the stock transfer books of the Company are closed, such person shall be deemed to have become the holder of such shares at the close of business on the next
succeeding date on which the stock transfer books are open. 
  
 2.2 Net Exercise. Notwithstanding any provisions herein to the contrary, if the fair market value of one share of the Company’s Common Stock is greater than the Exercise Price (at the date of calculation
as set forth below), in lieu of exercising this Warrant by payment of cash, the Holder may elect to receive shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the
principal office of the Company together with the properly endorsed Notice of Exercise in which event the Company shall issue to the Holder a number of shares of Common Stock computed using the following formula: 
  

			
	X =	 	Y (A-B)
	 	 	      A

  

			
	Where X =	  	the number of shares of Common Stock to be issued to the Holder
		
	Y =	  	the number of shares of Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being canceled (at the date of such
calculation)
		
	A =	  	the fair market value of one share of the Company’s Common Stock (at the date of such calculation)
		
	B =	  	Exercise Price (as adjusted to the date of such calculation)

  
 For purposes of the
above calculation, the fair market value of one share of Common Stock shall mean the average of the closing bid and asked prices of Common Stock quoted in the over-the-counter market in which the Common Stock is traded or the closing price quoted on
any exchange on which the Common Stock is listed, whichever is applicable, as published in the Western Edition of The Wall Street Journal for the ten (10) trading days prior to the date of determination of fair market value (or such
shorter period of time during which such stock was traded over-the-counter or on such exchange). If the Common Stock is not traded on the over-the-counter market or on an exchange, the fair market value shall be the price per share that the Company
could obtain from a willing buyer for Common Stock sold by the Company from authorized but unissued shares, as such price shall be determined in good faith by the Company’s Board of Directors; provided, however, that in the event that this
Warrant is exercised pursuant to this Section 2.1 in connection with the Company’s initial public offering of its Common Stock, the fair market value per share shall be the per share offering price to the public of the Company’s
initial public offering. 
  
 3. COVENANTS
OF THE COMPANY. 
  
 3.1 Covenants as to Exercise Shares. The Company covenants and agrees that all Exercise Shares that may be issued upon the
exercise of the rights represented by this Warrant will, upon issuance, be validly issued and outstanding, fully paid and nonassessable, and free from all taxes, liens and charges with respect to the issuance thereof. The Company further covenants
and agrees that the Company will at all times during the Exercise Period, have authorized and reserved a sufficient number of 

 
shares of its Common Stock to provide for the exercise of the rights represented by this Warrant. If at any time during the Exercise Period the number of
authorized but unissued shares of Common Stock shall not be sufficient to permit exercise of this Warrant, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares
of Common Stock to such number of shares as shall be sufficient for such purposes. 
  
 3.2 No Impairment. Except and to the extent as waived or consented to by the Holder, the Company will not, by amendment of
its Certificate of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the
terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Warrant and in the taking of all such action as may be necessary or appropriate in order to
protect the exercise rights of the Holder against impairment. 
  
 4. REPRESENTATIONS OF HOLDER. 
  
 4.1 Acquisition of Warrant for Personal Account. The Holder represents and warrants that it is acquiring the Warrant and the
Exercise Shares solely for its account for investment and not with a view to or for sale or distribution of said Warrant or Exercise Shares or any part thereof. The Holder also represents that the entire legal and beneficial interests of the Warrant
and Exercise Shares the Holder is acquiring is being acquired for, and will be held for, its account only. 
  
 4.2 Securities Are Not Registered. 
  

(a) The Holder understands that the Warrant and the Exercise Shares have not been registered under the Securities Act of 1933,
as amended (the “Act”) on the basis that no distribution or public offering of the stock of the Company is to be effected. The Holder realizes that the basis for the exemption may not be present if, notwithstanding its
representations, the Holder has a present intention of acquiring the securities for a fixed or determinable period in the future, selling (in connection with a distribution or otherwise), granting any participation in, or otherwise distributing the
securities. The Holder has no such present intention. 
  
 (b) The Holder recognizes that the Warrant and the Exercise Shares must be held indefinitely unless they are subsequently registered under the Act or an exemption from such registration is available. The Holder recognizes that the
Company has no obligation to register the Warrant or the Exercise Shares of the Company, or to comply with any exemption from such registration. 
  
 (c) The Holder is aware that neither the Warrant nor the Exercise Shares may be sold pursuant to Rule 144 adopted under the Act
unless certain conditions are met, including, among other things, the existence of a public market for the shares, the availability of certain current public information about the Company, the resale following the required holding period under Rule
144 and the number of shares being sold during any three month period not exceeding specified limitations. The Holder is aware that the conditions for resale set forth in Rule 144 have not been satisfied and that the Company presently has no plans
to satisfy these conditions in the foreseeable future. 

 4.3 Disposition of Warrant and Exercise Shares. 
  
 (a) The Holder further agrees not to make any
disposition of all or any part of the Warrant or Exercise Shares in any event unless and until: 
  
 (i) The Company shall have received a letter secured by the Holder from the Securities and Exchange Commission stating that no
action will be recommended to the Commission with respect to the proposed disposition; 
  
 (ii) There is then in effect a registration statement under the Act covering such proposed disposition and such disposition is
made in accordance with said registration statement; or 
  
 (iii) The Holder shall have notified the Company of the proposed disposition and shall have furnished the Company with a detailed statement of the circumstances surrounding the proposed disposition, and if
reasonably requested by the Company, the Holder shall have furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, for the Holder to the effect that such disposition will not require registration of such Warrant or
Exercise Shares under the Act or any applicable state securities laws. 
  
 (b) The Holder understands and agrees that all certificates evidencing the shares to be issued to the Holder may bear the following legend: 
  
 THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). THEY MAY NOT
BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED. 
  
 5. ADJUSTMENT OF EXERCISE
SHARES AND EXERCISE PRICE.  
  
 (a) Stock Splits, Combinations, etc. In the event of changes in the outstanding Common Stock of the Company by reason of
stock dividends, split-ups, recapitalizations, reclassifications, combinations or exchanges of shares, separations, reorganizations, liquidations, or the like, the number and class of shares available under the Warrant in the aggregate and the
Exercise Price shall be correspondingly adjusted to give the Holder of the Warrant, on exercise for the same aggregate Exercise Price, the total number, class, and kind of shares as the Holder would have owned had the Warrant been exercised prior to
the event and had the Holder continued to hold such shares until after the event requiring adjustment. The form of this Warrant need not be changed because of any adjustment in the number of Exercise Shares subject to this Warrant. The foregoing
provisions of this Section 5(a) shall similarly apply to successive stock dividends, split-ups, recapitalizations, reclassifications, combinations or exchanges of shares, separations, reorganizations, liquidations, or the like and to the stock
or securities of any other entity that are at the time receivable upon the exercise of this Warrant. 
  
 (b) Merger, Sale of Assets, etc. If at any time while this Warrant, or any portion hereof, is outstanding and unexpired
there shall occur (i) the sale, conveyance, exchange, license or other transfer of all or substantially all of the intellectual property or assets of the Company, (ii) any acquisition of the Company by means of a consolidation, stock
exchange, merger or other form of corporate reorganization of the Company with any other corporation in which the Company’s stockholders prior to the consolidation or merger own less than a majority of the voting securities of the surviving
entity or (iii) any transaction or series of related transactions following which the Company’s stockholders prior to such transaction or series of related transactions own less than a majority of the voting securities of the Company
(collectively, a “Change of Control”), this Warrant shall cease to represent the right to receive Exercise Shares and shall automatically and without further action represent the right to receive upon exercise of this Warrant,
during the period specified herein and upon payment of the Exercise Price then 

 
in effect, the number of shares of stock or other securities or property offered to the Company’s holders of Common Stock in connection with such Change
of Control that a holder of the shares deliverable upon exercise of this Warrant would have been entitled to receive in such Change of Control if this Warrant had been exercised immediately before such Change of Control, subject to further
adjustment as provided in this Section 5. The foregoing provisions of this Section 5(b) shall similarly apply to successive reorganizations, consolidations, mergers, sales and transfers and to the stock or securities of any other entity
that are at the time receivable upon the exercise of this Warrant. If the per share consideration payable to the holder hereof in connection with any such transaction is in a form other than cash or marketable securities, then the value of such
consideration shall be determined in good faith by the Company’s Board of Directors. In all events, appropriate adjustment (as determined in good faith by the Company’s Board of Directors) shall be made in the application of the provisions
of this Warrant with respect to the rights and interests of the Holder after the transaction, to the end that the provisions of this Warrant shall be applicable after that event, as near as reasonably may be, in relation to any shares or other
property deliverable after that event upon exercise of this Warrant. 
  
 6. FRACTIONAL SHARES. No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment pursuant hereto. All Exercise Shares (including fractions) issuable
upon exercise of this Warrant may be aggregated for purposes of determining whether the exercise would result in the issuance of any fractional share. If, after aggregation, the exercise would result in the issuance of a fractional share, the
Company shall, in lieu of issuance of any fractional share, pay the Holder otherwise entitled to such fraction a sum in cash equal to the product resulting from multiplying the then current fair market value of an Exercise Share by such fraction.

  
 7. NOTICE OF
CERTAIN EVENTS. The Company shall provide to the Holder written notice of any event that would result in an adjustment to the Exercise Shares or Exercise Price pursuant to Section 5 hereof. 
  
 8. MARKET STAND-OFF
AGREEMENT. 
  
 (a) In
connection with any public offering of securities of the Company registered under the Act, the Holder hereby agrees not to sell, transfer, make any short sale of, grant any option for the purchase of, enter into any hedging or similar transaction
with the same economic effect as a sale or otherwise transfer or dispose of any Common Stock (or any other securities of the Company) held by the Holder (other than those included in the registration) for a period of one hundred eighty
(180) calendar days following the effective date of a registration statement of the Company filed under the Act in connection with such offering (or such other period specified by the representative of the underwriters of the Common Stock (or
any other securities) of the Company and agreed to by the Company) (the “Lock-Up Period”). The Holder agrees to execute and deliver such other agreements as may be reasonably requested by the Company or the underwriter that
are consistent with the Holder’s obligations under this Section 8 or that are necessary to give further effect thereto. The Company may impose stop-transfer instructions with respect to the shares of Common Stock (or any other securities)
subject to the foregoing restriction until the end of the market stand-off day period. 
  
 (b) Notwithstanding the foregoing, if (1) during the last 17 days of the Lock-Up Period, the Company issues an earnings
release or material news or a material event relating to the Company occurs or (2) prior to the expiration of the Lock-Up Period, the Company announces that it will release earnings results during the 16-day period beginning on the last day of
the Lock-Up Period, then the restrictions imposed under this Section 8 shall continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the announcement of the material news or the
occurrence of the material event, unless the underwriter waives, in writing, such extension. The Holder hereby further agrees that, prior to engaging in any transaction or taking any other action that is subject to 

 
the terms hereof during the period from the date hereof to and including the 34th day following the expiration of the Lock-Up Period, it will give notice thereof to the Company and will not consummate such transaction or take any such
action unless it has received written confirmation from the Company that the Lock-Up Period (as such may have been extended pursuant to this paragraph) has expired. 
  
 9. NO STOCKHOLDER RIGHTS. This Warrant in and of itself shall not
entitle the Holder to any voting rights or other rights as a stockholder of the Company. 
  
 10. TRANSFER OF WARRANT. Subject to applicable laws and the restriction on transfer set forth on the first page of this Warrant, this Warrant and all rights
hereunder shall not be transferable without the prior written consent of the Company and subject to any conditions that the Company may request in its sole discretion. In the event of any transfer, the transferee shall sign an investment letter in
form and substance satisfactory to the Company. 
  
 11.
LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is lost, stolen, mutilated or destroyed, the Company may, on such terms as to indemnity or
otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination and tenor as the Warrant so lost, stolen, mutilated or destroyed. Any such new Warrant
shall constitute an original contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated or destroyed Warrant shall be at any time enforceable by anyone. 
  
 12. NOTICES, ETC. All notices required or permitted hereunder shall be in writing and
shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed telex or facsimile if sent during normal business hours of the recipient, if not, then on the next business day,
(c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the Company or to the Holder at their respective addresses set forth above or at such other address as the Company or the Holder may designate by ten (10) days advance
written notice to the other parties hereto. 
  
 13.
ACCEPTANCE. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein. 
  
 14. GOVERNING LAW. This Warrant and all rights, obligations and liabilities hereunder
shall be governed by the laws of the State of Delaware. 
  
 *            *             *            
*             *             * 

 IN WITNESS WHEREOF, the Company has
caused this Warrant to be executed by its duly authorized officer as of                     
        ,             . 
  

			
	LUNA INNOVATIONS INCORPORATED
		
	By:	 	 
		
	 Name:
	 	 
		
	 Title:
	 	 

  

			
	Agreed and accepted:
		
	By:	 	 
		
	 Name:
	 	 
		
	 Title:
	 	 

 NOTICE OF EXERCISE 
  
 TO: LUNA INNOVATIONS INCORPORATED 
  
 (1)  ̈ The undersigned hereby elects to purchase                      shares of
the Common Stock of LUNA INNOVATIONS INCORPORATED (the “Company”) pursuant to the terms of the attached Warrant, and tenders herewith payment of the exercise
price in full, together with all applicable transfer taxes, if any. 
  
  ̈ The undersigned hereby elects to purchase
                     shares of the Common Stock of LUNA INNOVATIONS
INCORPORATED (the “Company”) pursuant to the terms of the net exercise provisions set forth in Section 2.1 of the attached Warrant, and shall tender payment of all applicable transfer
taxes, if any. 
  
 (2) Please issue a certificate or
certificates representing said shares of Common Stock in the name of the undersigned or in such other name as is specified below: 
  
 _________________________ 
 (Name) 

 
 _________________________ 
  
 _________________________ 
 (Address) 
  
 (3) The undersigned represents that (i) the aforesaid shares of Common Stock are being acquired for the account of the undersigned for
investment and not with a view to, or for resale in connection with, the distribution thereof and that the undersigned has no present intention of distributing or reselling such shares; (ii) the undersigned is aware of the Company’s
business affairs and financial condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision regarding its investment in the Company; (iii) the undersigned is experienced in making
investments of this type and has such knowledge and background in financial and business matters that the undersigned is capable of evaluating the merits and risks of this investment and protecting the undersigned’s own interests; (iv) the
undersigned understands that the shares of Common Stock issuable upon exercise of this Warrant have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), by reason of a specific exemption
from the registration provisions of the Securities Act, which exemption depends upon, among other things, the bona fide nature of the investment intent as expressed herein, and, because such securities have not been registered under the Securities
Act, they must be held indefinitely unless subsequently registered under the Securities Act or an exemption from such registration is available; (v) the undersigned is aware that the aforesaid shares of Common Stock may not be sold pursuant to
Rule 144 adopted under the Securities Act unless certain conditions are met and until the undersigned has held the shares for the number of years prescribed by Rule 144, that among the conditions for use of the Rule is the availability of current
information to the public about the Company and the Company has not made such information available and has no present plans to do so; and (vi) the undersigned agrees not to make any disposition of all or any part of the aforesaid shares of
Common Stock unless and until there is then in effect a registration statement under the Securities Act covering such proposed disposition and such disposition is made in accordance with said registration statement, or the undersigned has provided
the Company with an opinion of counsel satisfactory to the Company, stating that such registration is not required. 

					
			
	  	 	 	 	  
	(Date)	 	 	 	(Signature)
			
	  	 	 	 	  
	 	 	 	 	(Print name)Exhibit 4.7

 Exhibit 4.7 
  

LUNA INNOVATIONS INCORPORATED 
  
 2003 STOCK PLAN 
  
 STOCK OPTION AGREEMENT 
  
 Unless otherwise defined herein, the terms defined in the 2003 Stock Plan shall have the same defined meanings in this Stock Option Agreement. 
  

	I.	NOTICE OF STOCK OPTION GRANT 

  
 Name: 
  
 Address: 
  
 The undersigned Optionee has been granted an Option to purchase Class B Common Stock of the Company, subject to the terms and conditions of the Plan and
this Option Agreement, as follows: 
  

					
	Date of Grant	  	 	  	 
			
	Vesting Commencement Date	  	 	  	 
			
	Exercise Price per Share	  	 	  	 
			
	Total Number of Shares Granted	  	 	  	 
			
	Total Exercise Price	  	 	  	 
			
	Type of Option:	  	  ̈        Incentive Stock Option
	  	 
			
	 	  	  ̈        Nonstatutory Stock Option
	  	 
			
	Term (years):	  	 	  	 

  
 Vesting
Schedule: 
  
 This Option shall be exercisable, in whole or
in part, according to the following vesting schedule: 

 Termination Period: 
  
 This Option shall be exercisable for three (3) months after Optionee ceases to be a Service Provider. Upon
Optionee’s death or Disability, this Option may be exercised for one (1) year after Optionee ceases to be a Service Provider. In no event may Optionee exercise this Option after the Term/Expiration Date as provided above. 
  

	II.	AGREEMENT 

  
 1. Grant of Option. The Plan Administrator of the Company hereby grants to the Optionee named in the Notice of Grant (the “Optionee”), an
option (the “Option”) to purchase the number of Shares set forth in the Notice of Grant, at the exercise price per Share set forth in the Notice of Grant (the “Exercise Price”), and subject to the terms and conditions of the
Plan, which is incorporated herein by reference. Subject to Section 15(c) of the Plan, in the event of a conflict between the terms and conditions of the Plan and this Option Agreement, the terms and conditions of the Plan shall prevail.

  
 If designated in the Notice of Grant as an
Incentive Stock Option (“ISO”), this Option is intended to qualify as an Incentive Stock Option as defined in Section 422 of the Code. Nevertheless, to the extent that it exceeds the $100,000 rule of Code Section 422(d), this
Option shall be treated as a Nonstatutory Stock Option (“NSO”). 
  
 2. Exercise of Option. 
  
 (a) Right to Exercise. This Option shall be exercisable during its term in accordance with the Vesting Schedule set out in the Notice of Grant and with the applicable provisions of the Plan and this Option
Agreement. 
  
 (b) Method of Exercise.
This Option shall be exercisable by delivery of an exercise notice in the form attached as Exhibit A (the “Exercise Notice”) which shall state the election to exercise the Option, the number of Shares with respect to which the
Option is being exercised, and such other representations and agreements as may be required by the Company. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all Exercised Shares. This Option shall be deemed
to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by the aggregate Exercise Price. 
  
 No Shares shall be issued pursuant to the exercise of an Option unless such issuance and such exercise comply with Applicable Laws.
Assuming such compliance, for income tax purposes the Shares shall be considered transferred to the Optionee on the date on which the Option is exercised with respect to such Shares. 
  
 3. Optionee’s Representations. In the event the Shares have not been registered under the Securities Act of
1933, as amended, at the time this Option is exercised, the Optionee shall, if required by the Company, concurrently with the exercise of all or any portion of this Option, deliver 

  

 -2- 

 
to the Company his or her Investment Representation Statement in the form attached hereto as Exhibit B. 
  
 4. Lock-Up Period. Optionee hereby agrees that Optionee shall not
offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any Class B
Common Stock (or other securities) of the Company or enter into any swap, hedging or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Class B Common Stock (or other securities) of
the Company held by Optionee (other than those included in the registration) for a period specified by the representative of the underwriters of Class B Common Stock (or other securities) of the Company not to exceed one hundred eighty
(180) days following the effective date of any registration statement of the Company filed under the Securities Act. 
  
 Optionee agrees to execute and deliver such other agreements as may be reasonably requested by the Company or the underwriter which are
consistent with the foregoing or which are necessary to give further effect thereto. In addition, if requested by the Company or the representative of the underwriters of Class B Common Stock (or other securities) of the Company, Optionee shall
provide, within ten (10) days of such request, such information as may be required by the Company or such representative in connection with the completion of any public offering of the Company’s securities pursuant to a registration
statement filed under the Securities Act. The obligations described in this Section shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms that may be promulgated in the future, or a
registration relating solely to a Commission Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer instructions with respect to the shares of Class B Common Stock (or other
securities) subject to the foregoing restriction until the end of said one hundred eighty (180) day period. Optionee agrees that any transferee of the Option or shares acquired pursuant to the Option shall be bound by this Section. 

 
 5. Method of Payment. Payment of the aggregate Exercise Price shall
be by any of the following, or a combination thereof, at the election of the Optionee: 
  
 (a) cash or check; 
  
 (b) consideration received by the Company under a formal cashless exercise program adopted by the Company in connection with the Plan; or

  
 (c) surrender of other Shares which,
(i) in the case of Shares acquired from the Company, either directly or indirectly, have been owned by the Optionee for more than six (6) months on the date of surrender, and (ii) have a Fair Market Value on the date of surrender
equal to the aggregate Exercise Price of the Exercised Shares. 
  
 6. Restrictions on Exercise. This Option may not be exercised until such time as the Plan has been approved by the shareholders of the Company, or if the issuance of such Shares upon such exercise or the method of payment of
consideration for such shares would constitute a violation of any Applicable Law. 
  

 -3- 

 7. Non-Transferability of Option. This Option may not be transferred in any manner otherwise than
by will or by the laws of descent or distribution and may be exercised during the lifetime of Optionee only by Optionee. The terms of the Plan and this Option Agreement shall be binding upon the executors, administrators, heirs, successors and
assigns of the Optionee. 
  
 8. Term of Option. This Option
may be exercised only within the term set out in the Notice of Grant, and may be exercised during such term only in accordance with the Plan and the terms of this Option. 
  
 9. Tax Obligations. 
  
 (a) Withholding Taxes. Optionee agrees to make appropriate arrangements with the Company (or the Parent or Subsidiary employing or
retaining Optionee) for the satisfaction of all Federal, state, local and foreign income and employment tax withholding requirements applicable to the Option exercise. Optionee acknowledges and agrees that the Company may refuse to honor the
exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of exercise. 
  
 (b) Notice of Disqualifying Disposition of ISO Shares. If the Option granted to Optionee herein is an ISO, and if Optionee sells or
otherwise disposes of any of the Shares acquired pursuant to the ISO on or before the later of (1) the date two years after the Date of Grant, or (2) the date one year after the date of exercise, the Optionee shall immediately notify the
Company in writing of such disposition. Optionee agrees that Optionee may be subject to income tax withholding by the Company on the compensation income recognized by the Optionee. 
  
 10. Entire Agreement; Governing Law. The Plan is incorporated herein by reference. The Plan and this Option Agreement
constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof, and may not be
modified adversely to the Optionee’s interest except by means of a writing signed by the Company and Optionee. This agreement is governed by the internal substantive laws but not the choice of law rules of Virginia. 
  

 -4- 

 11. No Guarantee of Continued Service. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES
PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND
AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT
ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE OPTIONEE’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE. 
  
 Optionee acknowledges receipt of a copy of the Plan and represents that he or
she is familiar with the terms and provisions thereof, and hereby accepts this Option subject to all of the terms and provisions thereof. Optionee has reviewed the Plan and this Option in their entirety, has had an opportunity to obtain the advice
of counsel prior to executing this Option and fully understands all provisions of the Option. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under
the Plan or this Option. Optionee further agrees to notify the Company upon any change in the residence address indicated below. 
  

					
	OPTIONEE	 	 	 	LUNA INNOVATIONS INCORPORATED
			
	  	 	 	 	  
	Signature	 	 	 	By: Kent A. Murphy
			
	  	 	 	 	  
	Print Name	 	 	 	Title: President/CEO
			
	  	 	 	 	  
	Residence Address	 	 	 	 

  

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 EXHIBIT A 
  
 2003 STOCK PLAN 
  
 EXERCISE NOTICE 
  
 Luna Innovations Incorporated 
 2851 Commerce Street 
 Blacksburg, Virginia 24060 
  
 Attention: [                    ] 
  
 1. Exercise of Option. Effective as of today,
                                ,
            , the undersigned (“Optionee”) hereby elects to exercise Optionee’s option to purchase
                     shares of the Class B Common Stock (the “Shares”) of Luna Innovations Incorporated (the “Company”)
under and pursuant to the 2003 Stock Plan (the “Plan”) and the Stock Option Agreement dated                     ,
            (the “Option Agreement”). 
  
 2. Delivery of Payment. Purchaser herewith delivers to the Company the full purchase price of the Shares, as set forth in the Option Agreement, and
any and all withholding taxes due in connection with the exercise of the Option. 
  
 3. Representations of Optionee. Optionee acknowledges that Optionee has received, read and understood the Plan and the Option Agreement and agrees to abide by and be bound by their terms and conditions.

  
 4. Rights as Shareholder. The Company’s Class B
Common Stock is non-voting except to the extent otherwise required under the General Corporation Law of Delaware. Until the issuance of the Shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company), no right to receive dividends or any other rights as a shareholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Shares shall be issued to the Optionee as soon as practicable
after the Option is exercised in accordance with the Option Agreement. No adjustment shall be made for a dividend or other right for which the record date is prior to the date of issuance except as provided in Section 13 of the Plan.

  
 5. Company’s Right of First Refusal. Before any
Shares held by Optionee or any transferee (either being sometimes referred to herein as the “Holder”) may be sold or otherwise transferred (including transfer by gift or operation of law), the Company or its assignee(s) shall have a right
of first refusal to purchase the Shares on the terms and conditions set forth in this Section (the “Right of First Refusal”). 
  
 (a) Notice of Proposed Transfer. The Holder of the Shares shall deliver to the Company a written notice (the “Notice”)
stating: (i) the Holder’s bona fide intention to sell or 

 
otherwise transfer such Shares; (ii) the name of each proposed purchaser or other transferee (“Proposed Transferee”); (iii) the number of
Shares to be transferred to each Proposed Transferee; and (iv) the bona fide cash price or other consideration for which the Holder proposes to transfer the Shares (the “Offered Price”), and the Holder shall offer the Shares at the
Offered Price to the Company or its assignee(s). 
  
 (b) Exercise of Right of First Refusal. At any time within thirty (30) days after receipt of the Notice, the Company and/or its assignee(s) may, by giving written notice to the Holder, elect to purchase all, but not less than
all, of the Shares proposed to be transferred to any one or more of the Proposed Transferees, at the purchase price determined in accordance with subsection (c) below. 
  
 (c) Purchase Price. The purchase price (“Purchase Price”) for the Shares purchased by the
Company or its assignee(s) under this Section shall be the Offered Price. If the Offered Price includes consideration other than cash, the cash equivalent value of the non-cash consideration shall be determined by the Board of Directors of the
Company in good faith. 
  
 (d) Payment.
Payment of the Purchase Price shall be made, at the option of the Company or its assignee(s), in cash (by check), by cancellation of all or a portion of any outstanding indebtedness of the Holder to the Company (or, in the case of repurchase by an
assignee, to the assignee), or by any combination thereof within thirty (30) days after receipt of the Notice or in the manner and at the times set forth in the Notice. 
  
 (e) Holder’s Right to Transfer. If all of the Shares proposed in the Notice to be transferred to
a given Proposed Transferee are not purchased by the Company and/or its assignee(s) as provided in this Section, then the Holder may sell or otherwise transfer such Shares to that Proposed Transferee at the Offered Price or at a higher price,
provided that such sale or other transfer is consummated within 120 days after the date of the Notice, that any such sale or other transfer is effected in accordance with any applicable securities laws and that the Proposed Transferee agrees in
writing that the provisions of this Section shall continue to apply to the Shares in the hands of such Proposed Transferee. If the Shares described in the Notice are not transferred to the Proposed Transferee within such period, a new Notice shall
be given to the Company, and the Company and/or its assignees shall again be offered the Right of First Refusal before any Shares held by the Holder may be sold or otherwise transferred. 
  
 (f) Exception for Certain Family Transfers. Anything to the contrary contained in this Section
notwithstanding, the transfer of any or all of the Shares during the Optionee’s lifetime or on the Optionee’s death by will or intestacy to the Optionee’s immediate family or a trust for the benefit of the Optionee’s immediate
family shall be exempt from the provisions of this Section. “Immediate Family” as used herein shall mean spouse, lineal descendant or antecedent, father, mother, brother or sister. In such case, the transferee or other recipient shall
receive and hold the Shares so transferred subject to the provisions of this Section, and there shall be no further transfer of such Shares except in accordance with the terms of this Section. 
  
 (g) Termination of Right of First Refusal. The Right
of First Refusal shall terminate as to any Shares upon the earlier of (i) the first sale of Class B Common Stock of the 

  

 -2- 

 
Company to the general public, or (ii) a Change in Control in which the successor corporation has equity securities that are publicly traded.

  
 6. Tax Consultation. Optionee understands that Optionee
may suffer adverse tax consequences as a result of Optionee’s purchase or disposition of the Shares. Optionee represents that Optionee has consulted with any tax consultants Optionee deems advisable in connection with the purchase or
disposition of the Shares and that Optionee is not relying on the Company for any tax advice. 
  
 7. Restrictive Legends and Stop-Transfer Orders. 
  
 (a) Legends. Optionee understands and agrees that the Company shall cause the legends set forth below or legends substantially
equivalent thereto, to be placed upon any certificate(s) evidencing ownership of the Shares together with any other legends that may be required by the Company or by state or federal securities laws: 
  
 THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF COMPANY COUNSEL SATISFACTORY TO THE ISSUER OF THESE
SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE THEREWITH. 
  
 THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND A RIGHT OF FIRST REFUSAL HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND
THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS AND RIGHT OF FIRST REFUSAL ARE BINDING ON TRANSFEREES OF THESE SHARES. 
  
 (b) Stop-Transfer Notices. Optionee agrees that, in
order to ensure compliance with the restrictions referred to herein, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make
appropriate notations to the same effect in its own records. 
  
 (c) Refusal to Transfer. The Company shall not be required (i) to transfer on its books any Shares that have been sold or otherwise transferred in violation of any of the provisions of this Exercise Notice
or (ii) to treat as owner of such Shares or to accord the right to pay dividends to any purchaser or other transferee to whom such Shares shall have been so transferred. 
  
 8. Successors and Assigns. The Company may assign any of its rights under this Exercise Notice to single or multiple
assignees, and this Exercise Notice shall inure to the benefit of 

  

 -3- 

 
the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Exercise Notice shall be binding upon Optionee and
his or her heirs, executors, administrators, successors and assigns. 
  
 9. Interpretation. Any dispute regarding the interpretation of this Exercise Notice shall be submitted by Optionee or by the Company forthwith to the Administrator which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Administrator shall be final and binding on all parties. 
  
 10. Governing Law; Severability. This Exercise Notice is governed by the internal substantive laws but not the choice of law rules, of Virginia. In the event that any provision hereof becomes or is declared by
a court of competent jurisdiction to be illegal, unenforceable or void, this Option Agreement will continue in full force and effect. 
  
 11. Entire Agreement. The Plan and Option Agreement are incorporated herein by reference. This Exercise Notice, the Plan, the Option Agreement and
the Investment Representation Statement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the
subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and Optionee. 
  

					
	 Submitted by:
	 	 	 	 Accepted by:

			
	 [OPTIONEE NAME]
	 	 	 	 LUNA INNOVATIONS INCORPORATED

			
	  	 	 	 	  
	Signature	 	 	 	By
			
	  	 	 	 	  
	Print Name	 	 	 	Title
			
	Address:	 	 	 	Address:
	 	 	 	 	 
			
	 	 	 	 	 
			
	 	 	 	 	 
			
	  	 	 	 	  
	 	 	 	 	Date Received

  

 -4- 

 EXHIBIT B 
  
 INVESTMENT REPRESENTATION STATEMENT 
  

			
	OPTIONEE:	  	 
		
	COMPANY:	  	LUNA INNOVATIONS INCORPORATED
		
	SECURITY:	  	CLASS B COMMON STOCK
		
	AMOUNT:	  	 
		
	DATE:	  	 

  
 In connection with the
purchase of the above-listed Securities, the undersigned Optionee represents to the Company the following: 
  
 (a) Optionee is aware of the Company’s business affairs and financial condition and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire the Securities. Optionee is acquiring these Securities for investment for Optionee’s own account only and not with a view to, or for resale in connection with, any “distribution” thereof
within the meaning of the Securities Act of 1933, as amended (the “Securities Act”). 
  
 (b) Optionee acknowledges and understands that the Securities constitute “restricted securities” under the Securities Act and have not been registered under the Securities Act in reliance upon a specific
exemption therefrom, which exemption depends upon, among other things, the bona fide nature of Optionee’s investment intent as expressed herein. In this connection, Optionee understands that, in the view of the Securities and Exchange
Commission, the statutory basis for such exemption may be unavailable if Optionee’s representation was predicated solely upon a present intention to hold these Securities for the minimum capital gains period specified under tax statutes, for a
deferred sale, for or until an increase or decrease in the market price of the Securities, or for a period of one year or any other fixed period in the future. Optionee further understands that the Securities must be held indefinitely unless they
are subsequently registered under the Securities Act or an exemption from such registration is available. Optionee further acknowledges and understands that the Company is under no obligation to register the Securities. Optionee understands that the
certificate evidencing the Securities will be imprinted with any legend required under applicable state securities laws. 
  
 (c) Optionee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under the Securities Act, which, in substance, permit
limited public resale of “restricted securities” acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies
under Rule 701 at the time of the grant of the Option to the Optionee, the exercise will be exempt from registration under the Securities Act. In the event the Company becomes subject to the reporting requirements of Section 13 or 15(d) of
the Securities Exchange Act of 1934, ninety (90) days thereafter (or such 

 
longer period as any market stand-off agreement may require) the Securities exempt under Rule 701 may be resold, subject to the satisfaction of certain
of the conditions specified by Rule 144, including: (1) the resale being made through a broker in an unsolicited “broker’s transaction” or in transactions directly with a market maker (as said term is defined under the
Securities Exchange Act of 1934); and, in the case of an affiliate, (2) the availability of certain public information about the Company, (3) the amount of Securities being sold during any three month period not exceeding the limitations
specified in Rule 144(e), and (4) the timely filing of a Form 144, if applicable. 
  
 In the event that the Company does not qualify under Rule 701 at the time of grant of the Option, then the Securities may be resold
in certain limited circumstances subject to the provisions of Rule 144, which requires the resale to occur not less than one year after the later of the date the Securities were sold by the Company or the date the Securities were sold by
an affiliate of the Company, within the meaning of Rule 144; and, in the case of acquisition of the Securities by an affiliate, or by a non-affiliate who subsequently holds the Securities less than two years, the satisfaction of the conditions
set forth in sections (1), (2), (3) and (4) of the paragraph immediately above. 
  
 (d) Optionee further understands that in the event all of the applicable requirements of Rule 701 or 144 are not satisfied, registration under the Securities Act, compliance with Regulation A, or some other
registration exemption will be required; and that, notwithstanding the fact that Rules 144 and 701 are not exclusive, the Staff of the Securities and Exchange Commission has expressed its opinion that persons proposing to sell private placement
securities other than in a registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden of proof in establishing that an exemption from registration is available for such offers or sales, and that such
persons and their respective brokers who participate in such transactions do so at their own risk. Optionee understands that no assurances can be given that any such other registration exemption will be available in such event. 
  

	
	 Signature of Optionee:

	
	 
	
	 Date:
                                        
                          ,         

  

 -2-

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