Document:

2003 Israeli Share Option Plan

 Exhibit 4.1 
 PASSAVE, INC. 
 THE 2003 ISRAELI SHARE OPTION PLAN 
 (*In compliance with Amendment No. 132 of the Israeli Tax Ordinance, 2002) 
  

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 TABLE OF CONTENTS 
  

			
	 1. PURPOSE OF THE ISOP
	  	3
		
	 2. DEFINITIONS
	  	3
		
	 3. ADMINISTRATION OF THE ISOP
	  	6
		
	 4. DESIGNATION OF PARTICIPANTS
	  	7
		
	 5. DESIGNATION OF OPTIONS PURSUANT TO SECTION 102 
	  	8
		
	 6. TRUSTEE 
	  	9
		
	 7. SHARES RESERVED FOR THE ISOP
	  	10
		
	 8. PURCHASE PRICE
	  	10
		
	 9. ADJUSTMENTS
	  	11
		
	 10. TERM AND EXERCISE OF OPTIONS
	  	13
		
	 11. VESTING OF OPTIONS
	  	14
		
	 12. SHARES SUBJECT TO RIGHT OF FIRST REFUSAL
	  	14
		
	 13. DIVIDENDS 
	  	15
		
	 14. RESTRICTIONS ON ASSIGNABILITY AND SALE OF OPTIONS
	  	16
		
	 15. EFFECTIVE DATE AND DURATION OF THE ISOP
	  	16
		
	 16. AMENDMENTS OR TERMINATION
	  	16
		
	 17. GOVERNMENT REGULATIONS
	  	16
		
	 18. CONTINUANCE OF EMPLOYMENT
	  	17
		
	 19. GOVERNING LAW & JURISDICTION
	  	17
		
	 20. TAX CONSEQUENCES
	  	17
		
	 21. NON-EXCLUSIVITY OF THE ISOP
	  	18
		
	 22. MULTIPLE AGREEMENTS
	  	18

  

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 This plan, as amended from time to time, shall be known as Passave, Inc. 2003 Israeli Share Option Plan
(the “ISOP”). 
  

	1.	PURPOSE OF THE ISOP 

 The ISOP is intended to
provide an incentive to retain, in the employ of the Company and its Affiliates (as defined below), persons of training, experience, and ability, to attract new employees, directors, consultants, service providers and any other entity which the
Board shall decide their services are considered valuable to the Company, to encourage the sense of proprietorship of such persons, and to stimulate the active interest of such persons in the development and financial success of the Company by
providing them with opportunities to purchase shares in the Company, pursuant to the ISOP. 
  

	2.	DEFINITIONS 

 For purposes of the ISOP and
related documents, including the Option Agreement, the following definitions shall apply: 
  

	 	2.1	“Affiliate” means any “employing company” within the meaning of Section 102(a) of the Ordinance. For the purpose hereof “employer” means
Passave Ltd. 

  

	 	2.2	“Approved 102 Option” means an Option granted pursuant to Section 102(b) of the Ordinance and held in trust by a Trustee for the benefit of the Optionee, in
accordance with the provisions of the Ordinance. 

  

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

  

	 	2.4	“Capital Gain Option (CGO)” as defined in Section 5.4 below. 

  

	 	2.5	“Cause” means, (i) conviction of any felony involving moral turpitude or affecting the Company or its Affiliates; (ii) any refusal to carry out a
reasonable directive of the chief executive officer, the Board or the Optionee’s direct supervisor, which involves the business of the Company or its Affiliates and was capable of being lawfully performed; (iii) embezzlement of funds of
the Company or its Affiliates; (iv) any breach of the Optionee’s fiduciary duties or duties of care of the Company or its Affiliates; including without limitation disclosure of confidential information of the Company or its Affiliates; and
(v) any conduct (other than conduct in good faith) reasonably determined by the Board to be materially detrimental to the Company or its Affiliates. 

  

	 	2.6	“Chairman” means the chairman of the Committee. 

  

	 	2.7	“Committee” means a share option compensation committee appointed by the Board, which shall consist of no less than two members of the Board, or in the absence
thereof, the Board. The Committee shall have such authority as the Board has assigned to it. 

  

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	 	2.8	“Company” means Passave, Inc., an US corporation incorporated under the laws of Delaware. 

  

	 	2.9	“Controlling Shareholder” shall have the meaning ascribed to it in Section 32(9) of the Ordinance. 

  

	 	2.10	“Date of Grant” means, the date of grant of an Option, as determined by the Board or the Committee and set forth in the Optionee’s Option Agreement.

  

	 	2.11	“Employee” means a person who is employed by the Company or its Affiliates, including an individual who is serving as a director or an office holder, but excluding
Controlling Shareholder in the Company. An Employee shall not cease to be an Employee (i) in the case of any leave of absence approved by the Company or its Affiliates, as applicable, or (ii) upon the transfer of such Employee’s
employment among the Company and its Affiliates. 

  

	 	2.12	“Expiration date” means the date upon which an Option shall expire, as set forth in Section 10.2 of the ISOP. 

  

	 	2.13	“Fair Market Value” means as of any date, the value of a Share determined as follows: 

 (i) If the Shares are listed on any established stock exchange or a national market system, including without limitation the NASDAQ National Market
system, or the NASDAQ SmallCap Market of the NASDAQ Stock Market, the Fair Market Value shall be the closing sales price for such Shares (or the closing bid, if no sales were reported), as quoted on such exchange or system for the last market
trading day prior to time of determination, as reported in the Wall Street Journal, or such other source as the Board deems reliable. Without derogating from the above, solely for the purpose of determining the tax liability pursuant to
Section 102(b)(3) of the Ordinance, if at the Date of Grant the Company’s shares are listed on any established stock exchange or a national market system or if the Company’s shares will be registered for trading within ninety
(90) days following the Date of Grant, the Fair Market Value of a Share at the Date of Grant shall be determined in accordance with the average value of the Company’s shares on the thirty (30) trading days preceding the Date of Grant
or on the thirty (30) trading days following the date of registration for trading, as the case may be; 
 (ii) If the Shares are
regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value shall be the mean between the high bid and low asked prices for the Shares on the last market trading day prior to the day of
determination, or; 
  

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 (iii) In the absence of an established market for the Shares, the Fair Market Value thereof shall be
determined in good faith by the Board. 
  

	 	2.14	“IPO” means the initial public offering of the Company’s shares. 

  

	 	2.15	“ISOP” means this 2003 Israeli Share Option Plan. 

  

	 	2.16	“ITA” means the Israeli Tax Authorities. 

  

	 	2.17	“Non-Employee” means a consultant, adviser or service provider of the Company or its Affiliates, provided that such person is not an Employee or a Controlling
Shareholder in the Company. 

  

	 	2.18	“Ordinary Income Option (OIO)” as defined in Section 5.5 below. 

  

	 	2.19	“Option” means an option to purchase one or more Shares of the Company pursuant to the ISOP. 

  

	 	2.20	“102 Option” means any Option granted to Employees pursuant to Section 102 of the Ordinance. 

  

	 	2.21	“3(i) Option” means an Option granted pursuant to Section 3(i) of the Ordinance to any person who is Non- Employee. 

  

	 	2.22	“Optionee” means a person who receives or holds an Option under the ISOP. 

  

	 	2.23	“Option Agreement” means the share option agreement between the Company and an Optionee that sets out the terms and conditions of an Option.

  

	 	2.24	“Ordinance” means the 1961 Israeli Income Tax Ordinance [New Version] 1961, as now in effect or as hereafter amended and the regulations, rules and orders of
procedure promulgated thereunder from time to time. 

  

	 	2.25	“Purchase Price” means the price for each Share subject to an Option. 

  

	 	2.26	“Section 102” means section 102 of the Ordinance. 

  

	 	2.27	“Share” means the Common Stock, $          par value each, of the Company. 

  

	 	2.28	“Successor Company” means any entity the Company is merged to or is acquired by, in which the Company is not the surviving entity. 

  

	 	2.29	“Transaction” means (i) merger, acquisition or reorganization of the Company with one or more other entities in which the Company is not the surviving entity,
(ii) a sale of all or substantially all of the assets of the Company. 

  

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	 	2.30	“Trustee” means any individual appointed by the Company to serve as a trustee and approved by the ITA, all in accordance with the provisions of Section 102(a)
of the Ordinance. 

  

	 	2.31	“Unapproved 102 Option” means an Option granted pursuant to Section 102(c) of the Ordinance and not held in trust by a Trustee. 

  

	 	2.32	“Vested Option” means any Option, which has already been vested according to the Vesting Dates. 

  

	 	2.33	“Vesting Dates” means, as determined by the Board or by the Committee, the date as of which the Optionee shall be entitled to exercise the Options or part of the
Options, as set forth in Section 11 of the ISOP. 

  

	3.	ADMINISTRATION OF THE ISOP 

  

	 	3.1	The Board or the Committees hall have the power to administer the ISOP, all as provided by applicable law and in the Company’s incorporation documents, as amended from time to
time. Notwithstanding the above, the Board shall automatically have residual authority if no Committee shall be constituted or if such Committee shall cease to operate for any reason, in which case any reference to the Committee in the ISOP shall be
construed as a reference to the Board. 

  

	 	3.2	The Committee shall select one of its members as its Chairman and shall hold its meetings at such times and places as the Chairman shall determine. The Committee shall keep records
of its meetings and shall make such rules and regulations for the conduct of its business as it shall deem advisable. 

  

	 	3.3	The Committee shall have the full power and authority, subject to the approval of the Board to the extent required under applicable law or under the Company’s incorporation
documents, as amended from time to time, to: (i) designate Optionees; (ii) determine the terms and provisions of the respective Option Agreements, including, but not limited to, the number of Options to be granted to each Optionee, the
number of Shares to be covered by each Option, provisions concerning the time and the extent to which the Options may be exercised and the nature and duration of restrictions as to the transferability or restrictions constituting substantial risk of
forfeiture and to cancel or suspend awards, as necessary; (iii) determine the Fair Market Value of the Shares covered by each Option; (iv) make an election as to the type of 102 Approved Option; (v) designate the type of Options;
(vi) alter any restrictions and conditions of any Options or Shares subject to any Options (vii) interpret the provisions and supervise the administration of the ISOP; (viii) accelerate the right of an Optionee to exercise in whole or
in part, any previously granted Option; (ix) determine the Purchase Price of the Option; (x) prescribe, amend and rescind rules and regulations relating to the ISOP; and (xi) make all other determinations deemed necessary or advisable
for the administration of the ISOP. 

  

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	 	3.4	The Board or the Committee shall have the authority to grant, at its discretion, to the holder of an outstanding Option, in exchange for the surrender and cancellation of such
Option, a new Option having a purchase price equal to, lower than or higher than the Purchase Price of the original Option so surrendered and canceled and containing such other terms and conditions as the Board or the Committee may prescribe in
accordance with the provisions of the ISOP. 

  

	 	3.5	Subject to the Company’s incorporation documents, as amended from time to time, all decisions and selections made by the Board or the Committee pursuant to the provisions of
the ISOP shall be made by a majority of its members except that no member of the Board or the Committee shall vote on, or be counted for quorum purposes, with respect to any proposed action of the Board or the Committee relating to any Option to be
granted to that member. Any decision reduced to writing shall be executed in accordance with the provisions of the Company’s incorporation documents, as the same may be in effect from time to time. 

  

	 	3.6	The interpretation and construction by the Committee of any provision of the ISOP or of any Option Agreement thereunder shall be final and conclusive unless otherwise determined by
the Board. 

  

	 	3.7	Subject to the Company’s incorporation documents, as amended from time to time, the Company’s decision, and to all approvals legally required, each member of the Board or
the Committee shall be indemnified and held harmless by the Company against any cost or expense (including counsel fees) reasonably incurred by him, or any liability (including any sum paid in settlement of a claim with the approval of the Company)
arising out of any act or omission to act in connection with the ISOP unless arising out of such member’s own fraud or bad faith, to the extent permitted by applicable law. Such indemnification shall be in addition to any rights of
indemnification the member may have as a director or otherwise under the Company’s incorporation documents, as amended from time to time, any agreement, any vote of shareholders or disinterested directors, insurance policy or otherwise.

  

	4.	DESIGNATION OF PARTICIPANTS 

  

	 	4.1	The persons eligible for participation in the ISOP as Optionees shall include any Employees and/or Non-Employees of the Company or of any Affiliate; provided, however, that
(i) Employees may only be granted 102 Options; and (ii) Non-Employees may only be granted 3(i) Options. 

  

	 	4.2	The grant of an Option hereunder shall neither entitle the Optionee to participate nor disqualify the Optionee from participating in, any other grant of Options pursuant to the ISOP
or any other option or share plan of the Company or any of its Affiliates. 

  

	 	4.3	Anything in the ISOP to the contrary notwithstanding, all grants of Options to directors and office holders shall be authorized and implemented in accordance with the provisions of
the incorporation documents or any applicable law, as in effect from time to time. 

  

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	5.	DESIGNATION OF OPTIONS PURSUANT TO SECTION 102 

  

	 	5.1	The Company may designate Options granted to Employees pursuant to Section 102 as Unapproved 102 Options or Approved 102 Options. 

  

	 	5.2	The grant of Approved 102 Options shall be made under this ISOP as adopted by the Board in accordance with Section 15 below, and shall be conditioned upon the approval of this
ISOP by the ITA. 

  

	 	5.3	Approved 102 Option may either be classified as Capital Gain Option or Ordinary Income Option. 

  

	 	5.4	Approved 102 Option elected and designated by the Company to qualify under the capital gain tax treatment in accordance with the provisions of Section 102(b)(2) of the
Ordinance shall be referred to herein as “CGO”. 

  

	 	5.5	Approved 102 Option elected and designated by the Company to qualify under the ordinary income tax treatment in accordance with the provisions of Section 102(b)(1) of the
Ordinance shall be referred to herein as “OIO”. 

  

	 	5.6	No approved 102 Options may be granted to any Employee unless and until (i) this ISOP is approved by the ITA, and (ii) the Company’s election of the type of Approved
102 Options as CGI or OIO granted to Employees (the “Election”), has been appropriately filed with the ITA before the Date of Grant of the first Approved 102 Option. Such Election shall remain in effect until the end of the
subsequent year following the year during which the Company first granted Approved 102 Options. The Election shall obligate the Company to grant, during the period indicated in the sentence above, only the type of Approved 102 Option it has
elected, and shall apply to all Optionees who were granted Approved 102 Options during the period indicated herein, all in accordance with the provisions of Section 102(g) of the Ordinance. For the avoidance of doubt, such Election shall not
prevent the Company from granting Unapproved 102 Options to Employees or 3(i) Option to Non-Employees, simultaneously. 

  

	 	5.7	All Approved 102 Options must be held in trust by a Trustee, as described in Section 6 below. 

  

	 	5.8	For the avoidance of doubt, the designation of Unapproved 102 Options or Approved 102 Options shall be subject to the terms and conditions set forth in Section 102 of the
Ordinance. 

  

	 	5.9	With regards to Approved 102 Options, the provisions of the ISOP and/or the Option Agreement shall be subject to the provisions of Section 102 and the Tax Assessing
Officer’s permit, if applicable, and the said provisions and permit shall be deemed an 

  

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 integral part of the ISOP and of the Option Agreement. Any provision of Section 102 and/or the said
permit which is necessary in order to receive and/or to keep any tax benefit pursuant to Section 102, which is not expressly specified in the ISOP or the Option Agreement, shall be considered binding upon the Company and the Optionees.

  

	6.	TRUSTEE 

  

	 	6.1	Approved 102 Options which shall be granted under the ISOP and/or any Shares issued upon exercise of such Approved 102 Options and/or other shares received subsequently following
any realization of rights, including without limitation bonus shares in connection with such Options or Shares and all of the rights attached to the shares or options described above, shall be allocated or issued to the Trustee and held for the
benefit of the Optionees for such period of time as required by Section 102 (the “Section 102 Period”). All of the rights attached to Shares issued upon exercise of Approved 102 Options, including without limitation dividend in
shares, shall be subject to the same tax treatment as the treatment to which such Options are subject to. In the case the requirements for Approved 102 Options are not met, then the Approved 102 Options shall be treated as Unapproved 102 Options,
all in accordance with the provisions of Section 102. 

  

	 	6.2	Notwithstanding anything to the contrary, the Trustee shall not make any transaction or take any action with respect to Approved 102 Options or Shares issued upon exercise thereof,
will not transfer, assign, release, pledge, mortgage voluntary, whether immediately effective or effective at a future date, other than by will or by operation of law, until after the full payment of the Optionee’s tax liabilities arising from
the Approved 102 Options which were granted to him, their exercise, any Shares issued upon exercise of such Approved 102 Options or any release of transfer by the Trustee, or after guarantying the payment of said taxes. If such Options or Shares
have been transferred by will or by operation of law, the provisions of Section 102 will apply with respect to the or heirs or the transferees of the Optionee or Shareholder, as the case may be. 

  

	 	6.3	Upon receipt of Approved 102 Option, the Optionee will sign an undertaking to release the Trustee from any liability in respect of any action or decision duly taken and bona fide
executed by the Trustee (or any person of its behalf) in relation with the ISOP, or any Approved 102 Option or Share granted to the Optionee hereunder. 

  

	 	6.4	With respect to any Approved 102 Option, subject to the provisions of Section 102 and any rules or regulation or orders or procedures promulgated thereunder, an Optionee shall
not be entitled to sell or release from trust any Share received upon the exercise of an Approved 102 Option and/or any share received subsequently following any realization of rights, including without limitation, bonus shares, until the lapse of
the Section 102 Period required under Section 102 of the Ordinance 

  

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	7.	SHARES RESERVED FOR THE ISOP; RESTRICTION THEREON 

  

	 	7.1	The Company has reserved 5,800,0001 authorized
but unissued Shares (of which 2,577,829 have been previously granted) for the purposes of the ISOP, plus an annual increase to be added on the first business day of each calendar year beginning in 2006 equal to the lesser of (x) 750,000 Shares, (y)
4% of the number of Shares outstanding as of such date, or (z) a lesser number of Shares determined by the board or any of the committees appointed to administer the ISOP, subject to adjustment as set forth in Section 9 below. Any Shares issued
subject to awards granted under the Company’s 2005 U.S. Stock Incentive Plan (the “2005 U.S. Plan”) shall also count against (and reduce) the maximum aggregate number of Shares reserved for issuance under the ISOP. Any Shares which
remain unissued and which are not subject to the outstanding Options at the termination of the ISOP shall cease to be reserved for the purpose of the ISOP, but until termination of the ISOP the Company shall at all times reserve sufficient number of
Shares to meet the requirements of the ISOP. Should any Option for any reason expire or be canceled prior to its exercise or relinquishment in full, the Shares subject to such Option may again be subjected to an Option under the ISOP.

  

	 	7.2	Each Option granted pursuant to the ISOP, shall be evidenced by a written Option Agreement between the Company and the Optionee, in such form as the Board or the Committee shall
from time to time approve. Each Option Agreement shall state, among other matters, the number of Shares to which the Option relates, the type of Option granted thereunder (whether a CGI, OIO, Unapproved 102 Option or a 3(i) Option), the Vesting
Dates, the Purchase Price per share, the Expiration Date and such other terms and conditions as the Committee or the Board in its discretion may prescribe, provided that they are consistent with this ISOP. 

  

	 	7.3	Subject to the provisions of Section 102, until the consummation of an IPO, the Shares issued upon exercise of Options shall be voted by an irrevocable proxy (the
“Proxy”) pursuant to the directions of the Board, such Proxy to be assigned to the person or persons designated by the Board. Such person or persons designated by the Board shall be indemnified and held harmless by the Company
against any cost or expense (including counsel fees) reasonably incurred by him/her, or any liability (including any sum paid in settlement of a claim with the approval of the Company) arising out of any act or omission to act in connection with the
voting of such Proxy unless arising out of such member’s own fraud or bad faith, to the extent permitted by applicable law. Such indemnification shall be in addition to any rights of indemnification the person(s) may have as a director or
otherwise under the Company’s incorporation documents, as amended from time to time, any agreement, any vote of shareholders or disinterested directors, insurance policy or otherwise. The Proxy shall be delivered to the Company at such time as
set forth in the Option Agreement. Without derogating from the above, with respect to Approved 102 Options, such shares shall be voted in accordance with the provisions of Section 102 and any rules, regulations or orders promulgated thereunder.

  

	8.	PURCHASE PRICE 

  

	 	8.1	The Purchase Price of each Share subject to an Option shall be determined by the Board or the Committee in its sole and absolute discretion in accordance with

  

	(1)	Prior to a 1-for-2 reverse split of Passave’s common stock. 

  

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 applicable law, subject to any guidelines as may be determined by the Board or the Committee, as
applicable, from time to time. Each Option Agreement will contain the Purchase Price determined for each Optionee. 
  

	 	8.2	The Purchase Price shall be payable upon the exercise of the Option in a form satisfactory to the Committee, including without limitation, by cash or check. The Committee shall have
the authority to postpone the date of payment on such terms as it may determine. 

  

	 	8.3	The Purchase Price shall be denominated in the currency of the primary economic environment of, either the Company or the Optionee, as determined by the Company.

  

	9.	ADJUSTMENTS 

 Upon the occurrence of any of
the following described events, Optionee’s rights to purchase Shares under the ISOP shall be adjusted as hereafter provided: 
  

	 	9.1	In the event of Transaction, the unexercised Options then outstanding under the ISOP shall be assumed or substituted for an appropriate number of option for shares of common stock
or other securities of the Successor Company (or a parent or subsidiary of the Successor Company). In the case of such assumption and/or substitution of options, appropriate adjustments shall be made to the Purchase Price so as to reflect such
action and all other terms and conditions of the Option Agreements shall remain unchanged, including but not limited to the vesting schedule, all subject to the determination of the Committee or the Board, which determination shall be in their sole
discretion and final. The Company shall notify the Optionee of the Transaction in such form and method as it deems applicable at least ten (10) days prior to the effective date of such Transaction. 

  

	 	9.2	Notwithstanding the above and subject to any applicable law, if in any such Transaction as described in section 9.1 above, the Successor Company (or parent or subsidiary of the
Successor Company) does not agree to assume or substitute for the Options, all the unvested options will be expired, unless otherwise determined by the Board. 

  

	 	9.3	For the purposes of section 9.1 above, an Option shall be considered assumed or substituted if, following the Transaction, the Option confers the right to purchase or receive, for
each Share underlying an Option immediately prior to the Transaction, the consideration (whether shares, options, cash, or other securities or property) received in the Transaction by holders of shares of common stock held on the effective date of
the Transaction (and if such holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares); provided, however, that if such consideration received in the Transaction is not
solely common stock (or their equivalent) of the Successor Company or its parent or subsidiary, the Committee may, with the consent of the Successor Company, provide for the consideration to be received 

  

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 upon the exercise of the Option to be solely common stock (or their equivalent) of the Successor Company
or its parent or subsidiary equal in Fair Market Value to the per Share consideration received by holders of a majority of the outstanding shares of common stock in the Transaction; and provided further that the Committee may determine, in its
discretion, that in lieu of such assumption or substitution of Options for options of the Successor Company or its parent or subsidiary, such Options will be substituted for any other type of asset or property including cash which is fair under the
circumstances. 
  

	 	9.4	If the Company is voluntarily liquidated or dissolved while unexercised Options remain outstanding under the ISOP, the Company shall immediately notify all unexercised Option
holders of such liquidation, and the Option holders shall then have ten (10) days to exercise any unexercised Vested Option held by them at that time, in accordance with the exercise procedure set forth herein. Upon the expiration of such
ten-days period, all remaining outstanding Options will terminate immediately. 

  

	 	9.5	If the outstanding shares of the Company shall at any time be changed or exchanged by declaration of a share dividend (bonus shares), share split, combination or exchange of shares,
recapitalization, or any other like event by or of the Company, and as often as the same shall occur, then the number, class and kind of the Shares subject to the ISOP or subject to any Options therefore granted, and the Purchase Prices, shall be
appropriately and equitably adjusted so as to maintain the proportionate number of Shares without changing the aggregate Purchase Price, provided, however, that no adjustment shall be made by reason of the distribution of subscription rights (rights
offering) on outstanding shares. Upon happening of any of the foregoing, the class and aggregate number of Shares issuable pursuant to the ISOP (as set forth in Section 7 hereof), in respect of which Options have not yet been exercised, shall
be appropriately adjusted, all as will be determined by the Board whose determination shall be final. 

  

	 	9.6	Anything herein to the contrary notwithstanding, if prior to the completion of the IPO all or substantially all of the shares of the Company are to be sold, or in case of a
Transaction, all or substantially all of the shares of the Company are to be exchanged for securities of another Company, then each Optionee shall be obliged to sell or exchange, as the case may be, any Shares such Optionee purchased under the ISOP,
in accordance with the instructions issued by the Board in connection with the Transaction, whose determination shall be final. 

  

	 	9.7	The Optionee acknowledges that in the event that the Company’s shares shall be registered for trading in any public market, Optionee’s rights to sell the Shares may be
subject to certain limitations (including a lock-up period), as will be requested by the Company or its underwriters, and the Optionee unconditionally agrees and accepts any such limitations. 

  

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	10.	TERM AND EXERCISE OF OPTIONS 

  

	 	10.1	Options shall be exercised by the Optionee by giving written notice to the Company and/or to any third party designated by the Company (the “Representative”), in
such form and method as may be determined by the Company and when applicable, by the Trustee in accordance with the requirements of Section 102, which exercise shall be effective upon receipt of such notice by the Company and/or the
Representative and the payment of the Purchase Price at the Company’s or the Representative’s principal office. The notice shall specify the number of Shares with respect to which the Option is being exercised. 

  

	 	10.2	Options, to the extent not previously exercised, shall terminate forthwith upon the earlier of: (i) the date set forth in the Option Agreement; and (ii) the expiration of
any extended period in any of the events set forth in section 10.5 below. 

  

	 	10.3	The Options may be exercised by the Optionee in whole at any time or in part from time to time, to the extent that the Options become vested and exercisable, prior to the Expiration
Date, and provided that, subject to the provisions of section 10.5 below, the Optionee is employed by or providing services to the Company or any of its Affiliates, at all times during the period beginning with the granting of the Option and ending
upon the date of exercise. 

  

	 	10.4	Subject to the provisions of section 10.5 below, in the event of termination of Optionee’s employment or services, with the Company or any of its Affiliates, all Options
granted to such Optionee will immediately expire. A notice of termination of employment or service shall be deemed to constitute termination of employment or service. For the avoidance of doubt, in case of such termination of employment or service,
the unvested portion of the Optionee’s Option shall not vest and shall not become exercisable. 

  

	 	10.5	Notwithstanding anything to the contrary hereinabove and unless otherwise determined in the Optionee’s Option Agreement, an Option may be exercised after the date of
termination of Optionee’s employment or service with the Company or any Affiliates during an additional period of time beyond the date of such termination, but only with respect to the number of Vested Options at the time of such termination
according to the Vesting Dates, if:  

  

	 	(i)	termination is without Cause, in which event any Vested Option still in force and unexpired may be exercised within a period of ninety (90) days after the date of such
termination; or- 

  

	 	(ii)	termination is the result of death or disability of the Optionee, in which event any Vested Option still in force and unexpired may be exercised within a period of twelve
(12) months after the date of such termination; or - 

  

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	 	(iii)	prior to the date of such termination, the Committee shall authorize an extension of the terms of all or part of the Vested Options beyond the date of such termination for a period
not to exceed the period during which the Options by their terms would otherwise have been exercisable. 

 For avoidance of any
doubt, if termination of employment or service is for Cause, any outstanding unexercised Option (whether vested or non-vested), will immediately expire and terminate, and the Optionee shall not have any right in connection to such outstanding
Options. 
  

	 	10.6	To avoid doubt, the holders of Options shall not be deemed owners of the Shares issuable upon the exercise of Options and shall not have any of the rights or privileges of
shareholders of the Company in respect of any Shares purchasable upon the exercise of any part of an Option, until registration of the Optionee as holder of such Shares in the Company’s register of shareholders upon exercise of the Option in
accordance with the provisions of the ISOP. 

  

	 	10.7	Any form of Option Agreement authorized by the ISOP may contain such other provisions as the Committee may, from time to time, deem advisable. 

  

	 	10.8	With respect to Unapproved 102 Option, if the Optionee ceases to be employed by the Company or any Affiliate, the Optionee shall extend to the Company and/or its Affiliate a
security or guarantee for the payment of tax due at the time of sale of Shares, all in accordance with the provisions of Section 102 and the rules, regulation or orders promulgated thereunder. 

  

	11.	VESTING OF OPTIONS 

  

	 	11.1	Subject to the provisions of the ISOP, each Option shall vest following the Vesting Dates and for the number of Shares as shall be provided in the Option Agreement. However, no
Option shall be exercisable after the Expiration Date. 

  

	 	11.2	An Option may be subject to such other terms and conditions on the time or times when it may be exercised, as the Committee may deem appropriate. The vesting provisions of
individual Options may vary. 

  

	12.	SHARES SUBJECT TO RIGHT OF FIRST REFUSAL 

  

	 	12.1	Notwithstanding anything to the contrary in the incorporation documents of the Company, as amended from time to time, none of the Optionees shall have a right of first refusal in
relation with any sale of shares in the Company. 

  

	 	12.2	Unless otherwise determined by the Committee, until such time as the Company shall complete an IPO, an Optionee shall not have the right to sell Shares issued upon the exercise of
an Option within six (6) months and one day of the date of exercise of such Option or issuance of such Shares. Unless otherwise determined by the Committee, until such time as the Company shall complete an IPO, the sale of Shares issuable upon
the exercise of an Option shall be subject to a right of first refusal on the part of the Repurchaser(s). 

  

 14 

 Repurchaser(s) means (i) the Company, if permitted by applicable law, ( ii) if the Company is not
permitted by applicable law , then any affiliate of the Company designated by the Committee; or (iii) if no decision is reached by the Committee, then the Company’s existing shareholders (save, for avoidance of doubt, for other Optionees
who already exercised their Options), pro rata in accordance with their shareholding. The Optionee shall give a notice of sale (hereinafter the “Notice”) to the Company in order to offer the Shares to the Repurchaser(s).

  

	 	12.3	The Notice shall specify the name of each proposed purchaser or other transferee (hereinafter the “Proposed Transferee”), the number of Shares offered for sale, the
price per Share and the payment terms. The Repurchaser(s) will be entitled for thirty (30) days from the day of receipt of the Notice (hereinafter the “Notice Period”), to purchase all or part of the offered Shares on a pro
rata basis based upon their respective holdings in the Company. 

  

	 	12.4	If by the end of the Notice Period not all of the offered Shares have been purchased by the Repurchaser(s), the Optionee shall be entitled to sell such Shares at any time during the
ninety (90) days following the end of the Notice Period on terms not more favorable than those set out in the Notice, provided 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. Any sale of Shares issued under the ISOP by the Optionee that is not made in accordance with the ISOP or the Option Agreement shall be null and void. 

  

	13.	DIVIDENDS 

 With respect to all Shares (but
excluding, for avoidance of any doubt, any unexercised Options) allocated or issued upon the exercise of Options purchased by the Optionee and held by the Optionee or by the Trustee, as the case may be, the Optionee shall be entitled to receive
dividends in accordance with the quantity of such Shares, subject to the provisions of the Company’s Articles of Association (and all amendments thereto) and subject to any applicable taxation on distribution of dividends, and when applicable
subject to the provisions of Section 102 and the rules, regulations or orders promulgated thereunder. 
  

 15 

	14.	RESTRICTIONS ON ASSIGNABILITY AND SALE OF OPTIONS 

  

	 	14.1	No Option or any right with respect thereto, purchasable hereunder, whether fully paid or not, shall be assignable, transferable or given as collateral or any right with respect to
it given to any third party whatsoever, except as specifically allowed under the ISOP, and during the lifetime of the Optionee each and all of such Optionee’s rights to purchase Shares hereunder shall be exercisable only by the Optionee.

 Any such action made directly or indirectly, for an immediate validation or for a future one, shall be void.

  

	 	14.2	As long as Options and/or Shares are held by the Trustee on behalf of the Optionee, all rights of the Optionee over the Options or the Shares are personal, can not be transferred,
assigned, pledged or mortgaged by the Optionee voluntary, other than by will or operation of law. 

  

	15.	EFFECTIVE DATE AND DURATION OF THE ISOP 

 The
ISOP shall be effective as of the day it was adopted by the Board and shall terminate at the end of ten (10) years from such day of adoption. 
  

	16.	AMENDMENTS OR TERMINATION 

 The Board may at
any time, but when applicable, after consultation with the Trustee, amend, alter, suspend or terminate the ISOP. No amendment, alteration, suspension or termination of the ISOP shall impair the rights of any Optionee, unless mutually agreed
otherwise between the Optionee and the Company, which agreement must be in writing and signed by the Optionee and the Company. Termination of the ISOP shall not affect the Committee’s ability to exercise the powers granted to it hereunder with
respect to Options granted under the ISOP prior to the date of such termination. 
  

	17.	GOVERNMENT REGULATIONS 

 The ISOP, and the
granting and exercise of Options hereunder, and the obligation of the Company to sell and deliver Shares under such Options, shall be subject to all applicable laws, rules, and regulations, whether of the State of Israel or of the United States or
any other State having jurisdiction over the Company and the Optionee, including the registration of the Shares under the United States Securities Act of 1933, and the Ordinance and to such approvals by any governmental agencies or national
securities exchanges as may be required. Nothing herein shall be deemed to require the Company to register the Shares under the securities laws of any jurisdiction. 
  

 16 

	18.	CONTINUANCE OF EMPLOYMENT OR HIRED SERVICES 

 Neither the ISOP nor the Option Agreement with the Optionee shall impose any obligation on the Company or an Affiliate thereof, to continue any Optionee in its employ or service, and nothing in the ISOP or in any Option granted pursuant
thereto shall confer upon any Optionee any right to continue in the employ or service of the Company or an Affiliate thereof or restrict the right of the Company or an Affiliate thereof to terminate such employment or service at any time.

  

	19.	GOVERNING LAW & JURISDICTION 

 The
ISOP shall be governed by and construed and enforced in accordance with the laws of the State of Israel applicable to contracts made and to be performed therein, without giving effect to the principles of conflict of laws. The competent courts of
Tel-Aviv, Israel shall have sole jurisdiction in any matters pertaining to the ISOP. 
  

	20.	TAX CONSEQUENCES 

  

	 	20.1	Any tax consequences arising from the grant or exercise of any Option, from the payment for Shares covered thereby, the release or transfer of Shares by the Trustee, or from any
other event or act (of the Company and/or its Affiliates, the Trustee or the Optionee), hereunder, shall be borne solely by the Optionee. The Company and/or its Affiliates and/or the Trustee, as applicable, shall withhold taxes according to the
requirements under the applicable laws, rules, and regulations, including withholding taxes at source. Furthermore, the Optionee shall agree to indemnify the Company and/or its Affiliates and/or the Trustee and hold them harmless against and from
any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Optionee.

  

	 	20.2	The Company and/or, when applicable, the Trustee shall not be required to release any Share certificate to an Optionee until all required payments have been fully made.

  

	 	20.3	To the extent provided by the terms of an Option Agreement, the Optionee may satisfy any tax withholding obligation relating to the exercise or acquisition of Shares under an Option
by any of the following means (in addition to the Company’s right to withhold from any compensation paid to the Optionee by the Company) or by a combination of such means: (i) tendering a cash payment; (ii) subject to the
Committee’s approval on the payment date, authorizing the Company to withhold Shares from the Shares otherwise issuable to the Optionee as a result of the exercise or acquisition of Shares under the Option in an amount not to exceed the minimum
amount of tax required to be withheld by law; or (iii) subject to Committee approval on the payment date, delivering to the Company owned and unencumbered Shares; provided that Shares acquired on exercise of Options have been held for at least
6 months from the date of exercise. 

  

 17 

	21.	NON-EXCLUSIVITY OF THE ISOP 

 The adoption of
the ISOP by the Board shall not be construed as amending, modifying or rescinding any previously approved incentive arrangements or as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem
desirable, including, without limitation, the granting of Options otherwise than under the ISOP, and such arrangements may be either applicable generally or only in specific cases. 
  

	22.	MULTIPLE AGREEMENTS 

 The terms of each
Option may differ from other Options granted under the ISOP at the same time, or at any other time. The Board may also grant more than one Option to a given Optionee during the term of the ISOP, either in addition to, or in substitution for, one or
more Options previously granted to that Optionee. 
  

 182005 U.S. Stock Incentive Plan

 Exhibit 4.2 
 PASSAVÉ, INC. 
 2005 U.S. STOCK INCENTIVE PLAN 
 1. Purposes of the Plan. The purposes of this Plan are to attract and retain the best available personnel, to provide additional incentives to
Employees, Directors and Consultants and to promote the success of the Company’s business. 
 2. Definitions. The following
definitions shall apply as used herein and in the individual Award Agreements except as defined otherwise in an individual Award Agreement. In the event a term is separately defined in an individual Award Agreement, such definition shall supercede
the definition contained in this Section 2. 
 (a) “2003 Israeli Plan” means the Company’s 2003 Israeli Share
Option Plan, as amended and restated. 
 (b) “Administrator” means the Board or any of the Committees appointed to
administer the Plan. 
 (c) “Affiliate” and “Associate” shall have the respective meanings ascribed to such
terms in Rule 12b-2 promulgated under the Exchange Act. 
 (d) “Applicable Laws” means the legal requirements relating
to the Plan and the Awards under applicable provisions of federal securities laws, state corporate and securities laws, the Code, the rules of any applicable stock exchange or national market system, and the rules of any non-U.S. jurisdiction
applicable to Awards granted to residents therein. 
 (e) “Assumed” means that pursuant to a Corporate Transaction either
(i) the Award is expressly affirmed by the Company or (ii) the contractual obligations represented by the Award are expressly assumed (and not simply by operation of law) by the successor entity or its Parent in connection with the
Corporate Transaction with appropriate adjustments to the number and type of securities of the successor entity or its Parent subject to the Award and the exercise or purchase price thereof which at least preserves the compensation element of the
Award existing at the time of the Corporate Transaction as determined in accordance with the instruments evidencing the agreement to assume the Award. 
 (f) “Award” means the grant of an Option, SAR, Dividend Equivalent Right, Restricted Stock, Restricted Stock Unit or other right or benefit under the Plan. 
 (g) “Award Agreement” means the written agreement evidencing the grant of an Award executed by the Company and the Grantee, including
any amendments thereto. 
 (h) “Board” means the Board of Directors of the Company. 
 (i) “Cause” means, with respect to the termination by the Company or a Related Entity of the Grantee’s Continuous Service, that
such termination is for “Cause” as such term (or word of like import) is expressly defined in a then-effective written agreement between the Grantee and the Company or such Related Entity, or in the absence of such then-effective 

  

 1 

 
written agreement and definition, is based on, in the determination of the Administrator, the Grantee’s: (i) performance of any act or failure to
perform any act in bad faith and to the detriment of the Company or a Related Entity; (ii) dishonesty, intentional misconduct or material breach of any agreement with the Company or a Related Entity; or (iii) commission of a crime
involving dishonesty, breach of trust, or physical or emotional harm to any person; provided, however, that with regard to any agreement that defines “Cause” on the occurrence of or in connection with a Corporate Transaction or a Change in
Control, such definition of “Cause” shall not apply until a Corporate Transaction or a Change in Control actually occurs. 
 (j)
“Change in Control” means a change in ownership or control of the Company after the Registration Date effected through either of the following transactions: 
 (i) the direct or indirect acquisition by any person or related group of persons (other than an acquisition from or by the Company or by a
Company-sponsored employee benefit plan or by a person that directly or indirectly controls, is controlled by, or is under common control with, the Company) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of
securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to the Company’s stockholders which a majority of the
Continuing Directors who are not Affiliates or Associates of the offeror do not recommend such stockholders accept, or 
 (ii) a change in
the composition of the Board over a period of twelve (12) months or less such that a majority of the Board members (rounded up to the next whole number) ceases, by reason of one or more contested elections for Board membership, to be comprised
of individuals who are Continuing Directors. 
 (k) “Code” means the Internal Revenue Code of 1986, as amended. 

(l) “Committee” means any committee composed of members of the Board appointed by the Board to administer the Plan. 
 (m) “Common Stock” means the common stock of the Company. 
 (n) “Company” means Passavé, Inc., a Delaware corporation, or any successor entity that adopts the Plan in connection with a Corporate Transaction. 
 (o) “Consultant” means any person (other than an Employee or a Director, solely with respect to rendering services in such person’s
capacity as a Director) who is engaged by the Company or any Related Entity to render consulting or advisory services to the Company or such Related Entity. 
 (p) “Continuing Directors” means members of the Board who either (i) have been Board members continuously for a period of at least twelve (12) months or (ii) have been Board members for
less than twelve (12) months and were elected or nominated for election as Board members by at least a majority of the Board members described in clause (i) who were still in office at the time such election or nomination was approved by
the Board. 
  

 2 

 (q) “Continuous Service” means that the provision of services to the Company or a
Related Entity in any capacity of Employee, Director or Consultant is not interrupted or terminated. In jurisdictions requiring notice in advance of an effective termination as an Employee, Director or Consultant, Continuous Service shall be deemed
terminated upon the actual cessation of providing services to the Company or a Related Entity notwithstanding any required notice period that must be fulfilled before a termination as an Employee, Director or Consultant can be effective under
Applicable Laws. A Grantee’s Continuous Service shall be deemed to have terminated either upon an actual termination of Continuous Service or upon the entity for which the Grantee provides services ceasing to be a Related Entity. Continuous
Service shall not be considered interrupted in the case of (i) any approved leave of absence, (ii) transfers among the Company, any Related Entity, or any successor, in any capacity of Employee, Director or Consultant, or (iii) any
change in status as long as the individual remains in the service of the Company or a Related Entity in any capacity of Employee, Director or Consultant (except as otherwise provided in the Award Agreement). An approved leave of absence shall
include sick leave, military leave, or any other authorized personal leave. For purposes of each Incentive Stock Option granted under the Plan, if such leave exceeds three (3) months, and reemployment upon expiration of such leave is not
guaranteed by statute or contract, then the Incentive Stock Option shall be treated as a Non-Qualified Stock Option on the day three (3) months and one (1) day following the expiration of such three (3) month period. 
 (r) “Corporate Transaction” means any of the following transactions, provided, however, that the Administrator shall determine under
parts (iv) and (v) whether multiple transactions are related, and its determination shall be final, binding and conclusive: 
 (i)
a merger or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the state in which the Company is incorporated; 
 (ii) the sale, transfer or other disposition of all or substantially all of the assets of the Company; 
 (iii) the complete liquidation or dissolution of the Company; 
 (iv) any reverse merger or series of related transactions culminating in a reverse merger (including, but not limited to, a tender offer followed by a reverse merger) in which the Company is the surviving entity but
(A) the shares of Common Stock outstanding immediately prior to such merger are converted or exchanged by virtue of the merger into other property, whether in the form of securities, cash or otherwise, or (B) in which securities possessing
more than forty percent (40%) of the total combined voting power of the Company’s outstanding securities are transferred to a person or persons different from those who held such securities immediately prior to such merger or the initial
transaction culminating in such merger, but excluding any such transaction or series of related transactions that the Administrator determines shall not be a Corporate Transaction; or 
 (v) acquisition in a single or series of related transactions by any person or related group of persons (other than the Company or by a
Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the 

  

 3 

 
Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities but
excluding any such transaction or series of related transactions that the Administrator determines shall not be a Corporate Transaction. 
 (s) “Covered Employee” means an Employee who is a “covered employee” under Section 162(m)(3) of the Code. 
 (t) “Director” means a member of the Board or the board of directors of any Related Entity. 
 (u)
“Disability” means as defined under the long-term disability policy of the Company or the Related Entity to which the Grantee provides services regardless of whether the Grantee is covered by such policy. If the Company or the
Related Entity to which the Grantee provides service does not have a long-term disability plan in place, “Disability” means that a Grantee is unable to carry out the responsibilities and functions of the position held by the Grantee by
reason of any medically determinable physical or mental impairment for a period of not less than ninety (90) consecutive days. A Grantee will not be considered to have incurred a Disability unless he or she furnishes proof of such impairment
sufficient to satisfy the Administrator in its discretion. 
 (v) “Dividend Equivalent Right” means a right entitling the
Grantee to compensation measured by dividends paid with respect to Common Stock. 
 (w) “Employee” means any person,
including an Officer or Director, who is in the employ of the Company or any Related Entity, subject to the control and direction of the Company or any Related Entity as to both the work to be performed and the manner and method of performance. The
payment of a director’s fee by the Company or a Related Entity shall not be sufficient to constitute “employment” by the Company. 
 (x) “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
 (y) “Fair Market
Value” means, as of any date, the value of Common Stock determined as follows: 
 (i) If the Common Stock is listed on one or more
established stock exchanges or national market systems, including without limitation The Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on the principal exchange or system on which the Common Stock is listed (as determined by the Administrator) on the date of determination (or, if no closing sales price or closing bid was reported on
that date, as applicable, on the last trading date such closing sales price or closing bid was reported), as reported in The Wall Street Journal or such other source as the Administrator deems reliable; 
 (ii) If the Common Stock is regularly quoted on an automated quotation system (including the OTC Bulletin Board) or by a recognized securities dealer,
its Fair Market Value shall be the closing sales price for such stock as quoted on such system or by 

  

 4 

 
such securities dealer on the date of determination, but if selling prices are not reported, the Fair Market Value of a share of Common Stock shall be the
mean between the high bid and low asked prices for the Common Stock on the date of determination (or, if no such prices were reported on that date, on the last date such prices were reported), as reported in The Wall Street Journal or such other
source as the Administrator deems reliable; or 
 (iii) In the absence of an established market for the Common Stock of the type described
in (i) and (ii), above, the Fair Market Value thereof shall be determined by the Administrator in good faith. 
 (z)
“Grantee” means an Employee, Director or Consultant who receives an Award under the Plan. 
 (aa) “Immediate
Family” means any child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive
relationships, any person sharing the Grantee’s household (other than a tenant or employee), a trust in which these persons (or the Grantee) have more than fifty percent (50%) of the beneficial interest, a foundation in which these persons
(or the Grantee) control the management of assets, and any other entity in which these persons (or the Grantee) own more than fifty percent (50%) of the voting interests. 
 (bb) “Incentive Stock Option” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of
the Code 
 (cc) “Non-Qualified Stock Option” means an Option not intended to qualify as an Incentive Stock Option.

 (dd) “Officer” means a person who is an officer of the Company or a Related Entity within the meaning of Section 16
of the Exchange Act and the rules and regulations promulgated thereunder. 
 (ee) “Option” means an option to purchase
Shares pursuant to an Award Agreement granted under the Plan. 
 (ff) “Parent” means a “parent corporation”,
whether now or hereafter existing, as defined in Section 424(e) of the Code. 
 (gg) “Performance-Based Compensation”
means compensation qualifying as “performance-based compensation” under Section 162(m) of the Code. 
 (hh)
“Plan” means this 2005 U.S. Stock Incentive Plan. 
 (ii) “Registration Date” means the first to occur of
(i) the closing of the first sale to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act of 1933, as amended, of (A) the Common Stock
or (B) the same class of securities of a successor corporation (or its Parent) issued pursuant to a Corporate Transaction in exchange for or in substitution of the 

  

 5 

 
Common Stock; and (ii) in the event of a Corporate Transaction, the date of the consummation of the Corporate Transaction if the same class of
securities of the successor corporation (or its Parent) issuable in such Corporate Transaction shall have been sold to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange
Commission under the Securities Act of 1933, as amended, on or prior to the date of consummation of such Corporate Transaction. 
 (jj)
“Related Entity” means any Parent or Subsidiary of the Company and any business, corporation, partnership, limited liability company or other entity in which the Company or a Parent or a Subsidiary of the Company holds a substantial
ownership interest, directly or indirectly. 
 (kk) “Replaced” means that pursuant to a Corporate Transaction the Award
is replaced with a comparable stock award or a cash incentive program of the Company, the successor entity (if applicable) or Parent of either of them which preserves the compensation element of such Award existing at the time of the Corporate
Transaction and provides for subsequent payout in accordance with the same (or a more favorable) vesting schedule applicable to such Award. The determination of Award comparability shall be made by the Administrator and its determination shall be
final, binding and conclusive. 
 (ll) “Restricted Stock” means Shares issued under the Plan to the Grantee for such
consideration, if any, and subject to such restrictions on transfer, rights of first refusal, repurchase provisions, forfeiture provisions, and other terms and conditions as established by the Administrator. 
 (mm) “Restricted Stock Units” means an Award which may be earned in whole or in part upon the passage of time or the attainment of
performance criteria established by the Administrator and which may be settled for cash, Shares or other securities or a combination of cash, Shares or other securities as established by the Administrator. 
 (nn) “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or any successor thereto. 
 (oo) “SAR” means a stock appreciation right entitling the Grantee to Shares or cash compensation, as established by the Administrator,
measured by appreciation in the value of Common Stock. 
 (pp) “Share” means a share of the Common Stock. 
 (qq) “Sub-Plan” means the rules or procedures adopted by the Administrator in order for the grant of Awards to comply with the
Applicable Laws of any non-U.S. jurisdiction. 
 (rr) “Subsidiary” means a “subsidiary corporation”, whether now
or hereafter existing, as defined in Section 424(f) of the Code. 
  

 6 

 3. Stock Subject to the Plan. 
 (a) Subject to the provisions of Section 10, below, the maximum aggregate number of Shares which may be issued pursuant to all Awards (including
Incentive Stock Options) is 5,800,0001 Shares, plus an annual increase to be added on the first business day of each
calendar year beginning in 2006 equal to the lesser of (x) 750,000 Shares, (y) four percent (4%) of the number of Shares outstanding as of such date, or (z) a lesser number of Shares determined by the Administrator. In addition,
Dividend Equivalent Rights shall be payable solely in cash and therefore the issuance of Dividend Equivalent Rights shall not be deemed to reduce the maximum aggregate number of Shares which may be issued under the Plan. The Shares to be issued
pursuant to Awards may be authorized, but unissued, or reacquired Common Stock. 
 (b) Any Shares issued subject to Options granted under the
2003 Israeli Plan shall also count against (and reduce) the maximum aggregate number of Shares reserved for issuance under the Plan. 
 (c)
Any Shares covered by an Award (or portion of an Award) which is forfeited, canceled or expires (whether voluntarily or involuntarily) shall be deemed not to have been issued for purposes of determining the maximum aggregate number of Shares which
may be issued under the Plan. Shares that actually have been issued under the Plan pursuant to an Award shall not be returned to the Plan and shall not become available for future issuance under the Plan, except that if unvested Shares are
forfeited, or repurchased by the Company at the lower of their original purchase price or their Fair Market Value at the time of repurchase, such Shares shall become available for future grant under the Plan. To the extent not prohibited by the
listing requirements of The Nasdaq National Market (or other established stock exchange or national market system on which the Common Stock is traded) and Applicable Law, any Shares covered by an Award which are surrendered (i) in payment of
the Award exercise or purchase price or (ii) in satisfaction of tax withholding obligations incident to the exercise of an Award shall be deemed not to have been issued for purposes of determining the maximum number of Shares which may be
issued pursuant to all Awards under the Plan, unless otherwise determined by the Administrator. 
 4. Administration of the Plan.

 (a) Plan Administrator. 
 (i) Administration with Respect to Directors and Officers. With respect to grants of Awards to Directors or Employees who are also Officers or Directors of the Company, the Plan shall be administered by (A) the Board or
(B) a Committee designated by the Board, which Committee shall be constituted in such a manner as to satisfy the Applicable Laws and to permit such grants and related transactions under the Plan to be exempt from Section 16(b) of the
Exchange Act in accordance with Rule 16b-3. Once appointed, such Committee shall continue to serve in its designated capacity until otherwise directed by the Board. 
 (ii) Administration With Respect to Consultants and Other Employees. With respect to grants of Awards to Employees or Consultants who are neither Directors nor 
  

	(1)	Prior to a 1-for-2 reverse split of Passave’s common stock. 

  

 7 

 
Officers of the Company, the Plan shall be administered by (A) the Board or (B) a Committee designated by the Board, which Committee shall be
constituted in such a manner as to satisfy the Applicable Laws. Once appointed, such Committee shall continue to serve in its designated capacity until otherwise directed by the Board. The Board may authorize one or more Officers to grant such
Awards and may limit such authority as the Board determines from time to time. 
 (iii) Administration With Respect to Covered
Employees. Notwithstanding the foregoing, as of and after the date that the exemption for the Plan under Section 162(m) of the Code expires, as set forth in Section 18 below, grants of Awards to any Covered Employee intended to qualify
as Performance-Based Compensation shall be made only by a Committee (or subcommittee of a Committee) which is comprised solely of two or more Directors eligible to serve on a committee making Awards qualifying as Performance-Based Compensation. In
the case of such Awards granted to Covered Employees, references to the “Administrator” or to a “Committee” shall be deemed to be references to such Committee or subcommittee. 
 (iv) Administration Errors. In the event an Award is granted in a manner inconsistent with the provisions of this subsection (a), such Award
shall be presumptively valid as of its grant date to the extent permitted by the Applicable Laws. 
 (b) Powers of the Administrator.
Subject to Applicable Laws and the provisions of the Plan (including any other powers given to the Administrator hereunder), and except as otherwise provided by the Board, the Administrator shall have the authority, in its discretion: 
 (i) to select the Employees, Directors and Consultants to whom Awards may be granted from time to time hereunder; 
 (ii) to determine whether and to what extent Awards are granted hereunder; 
 (iii) to determine the number of Shares or the amount of other consideration to be covered by each Award granted hereunder; 
 (iv) to approve forms of Award Agreements for use under the Plan; 
 (v) to determine the terms and conditions of any Award granted hereunder; 
 (vi) to amend the terms of any
outstanding Award granted under the Plan, provided that (A) any amendment that would adversely affect the Grantee’s rights under an outstanding Award shall not be made without the Grantee’s written consent, provided, however, that an
amendment or modification that may cause an Incentive Stock Option to become a Non-Qualified Stock Option shall not be treated as adversely affecting the rights of the Grantee, (B) the reduction of the exercise price of any Option awarded under
the Plan shall be subject to stockholder approval and (C) canceling an Option at a time when its exercise price exceeds the Fair Market Value of the underlying Shares, in exchange for another Option, Restricted Stock, or 

  

 8 

 
other Award shall be subject to stockholder approval, unless the cancellation and exchange occurs in connection with a Corporate Transaction; 
 (vii) to construe and interpret the terms of the Plan and Awards, including without limitation, any notice of award or Award Agreement, granted pursuant
to the Plan; 
 (viii) to grant Awards to Employees, Directors and Consultants employed outside the United States on such terms and
conditions different from those specified in the Plan as may, in the judgment of the Administrator, be necessary or desirable to further the purpose of the Plan; 
 (ix) to take such other action, not inconsistent with the terms of the Plan, as the Administrator deems appropriate; and 
 (x) to adopt rules or procedures relating to the operation and administration of the Plan to accommodate the specific requirements of the Applicable Law and procedures of any non-U.S. jurisdiction. Without limiting
the generality of the foregoing, the Administrator is specifically authorized to adopt rules and procedures regarding the handling of direct payments or other approved contributions, payment of interest, conversion of local currency, payroll tax,
income tax withholding and reporting procedures, and the handling of documents evidencing ownership of securities that vary with the laws of any non-U.S. jurisdiction. The Administrator may also adopt rules, procedures, or a Sub-Plan applicable to
particular Grantees and particular Affiliates. 
 The express grant in the Plan of any specific power to the Administrator shall not be construed as limiting
any power or authority of the Administrator; provided that the Administrator may not exercise any right or power reserved to the Board. Any decision made, or action taken, by the Administrator or in connection with the administration of this Plan
shall be final, conclusive and binding on all persons having an interest in the Plan. 
 (c) Indemnification. In addition to such
other rights of indemnification as they may have as members of the Board or as Officers or Employees of the Company or a Related Entity, members of the Board and any Officers or Employees of the Company or a Related Entity to whom authority to act
for the Board, the Administrator or the Company is delegated shall be defended and indemnified by the Company to the extent permitted by law on an after-tax basis against all reasonable expenses, including attorneys’ fees, actually and
necessarily incurred in connection with the defense of any claim, investigation, action, suit or proceeding, or in connection with any appeal therein, to which they or any of them may be a party by reason of any action taken or failure to act under
or in connection with the Plan, or any Award granted hereunder, and against all amounts paid by them in settlement thereof (provided such settlement is approved by the Company) or paid by them in satisfaction of a judgment in any such claim,
investigation, action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such claim, investigation, action, suit or proceeding that such person is liable for gross negligence, bad faith or intentional misconduct;
provided, however, that within thirty (30) days after the institution of such claim, investigation, action, suit or proceeding, such person 

  

 9 

 
shall offer to the Company, in writing, the opportunity at the Company’s expense to defend the same. 
 5. Eligibility. Awards other than Incentive Stock Options may be granted to Employees, Directors and Consultants. Incentive Stock Options may be
granted only to Employees of the Company or a Parent or a Subsidiary of the Company. An Employee, Director or Consultant who has been granted an Award may, if otherwise eligible, be granted additional Awards. Awards may be granted to such Employees,
Directors or Consultants who are residing in non-U.S. jurisdictions as the Administrator may determine from time to time. 
 6. Terms and
Conditions of Awards. 
 (a) Types of Awards. The Administrator is authorized under the Plan to award any type of arrangement to
an Employee, Director or Consultant that is not inconsistent with the provisions of the Plan and that by its terms involves or might involve the issuance of (i) Shares, (ii) cash or (iii) an Option, a SAR, or similar right with a
fixed or variable price related to the Fair Market Value of the Shares and with an exercise or conversion privilege related to the passage of time, the occurrence of one or more events, or the satisfaction of performance criteria or other
conditions. Such awards include, without limitation, Options, SARs, sales or bonuses of Restricted Stock, Restricted Stock Units or Dividend Equivalent Rights, and an Award may consist of one such security or benefit, or two (2) or more of them
in any combination or alternative. 
 (b) Designation of Award. Each Award shall be designated in the Award Agreement. In the case of
an Option, the Option shall be designated as either an Incentive Stock Option or a Non-Qualified Stock Option. However, notwithstanding such designation, an Option will qualify as an Incentive Stock Option under the Code only to the extent the
$100,000 dollar limitation of Section 422(d) of the Code is not exceeded. The $100,000 limitation of Section 422(d) of the Code is calculated based on the aggregate Fair Market Value of the Shares subject to Options designated as Incentive
Stock Options which become exercisable for the first time by a Grantee during any calendar year (under all plans of the Company or any Parent or Subsidiary of the Company). For purposes of this calculation, Incentive Stock Options shall be taken
into account in the order in which they were granted, and the Fair Market Value of the Shares shall be determined as of the grant date of the relevant Option. 
 (c) Conditions of Award. Subject to the terms of the Plan, the Administrator shall determine the provisions, terms, and conditions of each Award including, but not limited to, the Award vesting schedule,
repurchase provisions, rights of first refusal, forfeiture provisions, form of payment (cash, Shares, or other consideration) upon settlement of the Award, payment contingencies, and satisfaction of any performance criteria. The performance criteria
established by the Administrator may be based on any one of, or combination of, the following: (i) increase in share price, (ii) earnings per share, (iii) total stockholder return, (iv) operating margin, (v) gross margin,
(vi) return on equity, (vii) return on assets, (viii) return on investment, (ix) operating income, (x) net operating income, (xi) pre-tax profit, (xii) cash flow, (xiii) revenue, (xiv) expenses,
(xv) earnings before interest, taxes and depreciation, (xvi) economic value added and (xvii) market share. The performance criteria may be applicable to the Company, Related Entities and/or any individual business units of the Company
or any Related Entity. Partial 

  

 10 

 
achievement of the specified criteria may result in a payment or vesting corresponding to the degree of achievement as specified in the Award Agreement.

 (d) Acquisitions and Other Transactions. The Administrator may issue Awards under the Plan in settlement, assumption or
substitution for, outstanding awards or obligations to grant future awards in connection with the Company or a Related Entity acquiring another entity, an interest in another entity or an additional interest in a Related Entity whether by merger,
stock purchase, asset purchase or other form of transaction. 
 (e) Deferral of Award Payment. The Administrator may establish one or
more programs under the Plan to permit selected Grantees the opportunity to elect to defer receipt of consideration upon exercise of an Award, satisfaction of performance criteria, or other event that absent the election would entitle the Grantee to
payment or receipt of Shares or other consideration under an Award. The Administrator may establish the election procedures, the timing of such elections, the mechanisms for payments of, and accrual of interest or other earnings, if any, on amounts,
Shares or other consideration so deferred, and such other terms, conditions, rules and procedures that the Administrator deems advisable for the administration of any such deferral program. 
 (f) Separate Programs. The Administrator may establish one or more separate programs under the Plan for the purpose of issuing particular forms of
Awards to one or more classes of Grantees on such terms and conditions as determined by the Administrator from time to time.  
 (g)
Individual Limitations on Awards. 
 (i) Individual Limit for Options and SARs. Following the date that the exemption from
application of Section 162(m) of the Code described in Section 18 (or any exemption having similar effect) ceases to apply to Awards, the maximum number of Shares with respect to which Options and SARs may be granted to any Grantee in any
calendar year shall be [            ] Shares. In connection with a Grantee’s commencement of Continuous Service, a Grantee may be granted Options and SARs for up to an
additional [            ] Shares which shall not count against the limit set forth in the previous sentence. The foregoing limitations shall be adjusted proportionately in connection
with any change in the Company’s capitalization pursuant to Section 10, below. To the extent required by Section 162(m) of the Code or the regulations thereunder, in applying the foregoing limitations with respect to a Grantee, if any
Option or SAR is canceled, the canceled Option or SAR shall continue to count against the maximum number of Shares with respect to which Options and SARs may be granted to the Grantee. For this purpose, the repricing of an Option (or in the case of
a SAR, the base amount on which the stock appreciation is calculated is reduced to reflect a reduction in the Fair Market Value of the Common Stock) shall be treated as the cancellation of the existing Option or SAR and the grant of a new Option or
SAR. 
 (ii) Individual Limit for Restricted Stock and Restricted Stock Units. Following the date that the exemption from application
of Section 162(m) of the Code described in Section 18 (or any exemption having similar effect) ceases to apply to Awards, for awards of Restricted Stock and Restricted Stock Units that are intended to be Performance-Based 

  

 11 

 
Compensation, the maximum number of Shares with respect to which such Awards may be granted to any Grantee in any calendar year shall be
[            ] Shares. The foregoing limitation shall be adjusted proportionately in connection with any change in the Company’s capitalization pursuant to Section 10,
below. 
 (iii) Deferral. If the vesting or receipt of Shares under an Award is deferred to a later date, any amount (whether
denominated in Shares or cash) paid in addition to the original number of Shares subject to such Award will not be treated as an increase in the number of Shares subject to the Award if the additional amount is based either on a reasonable rate of
interest or on one or more predetermined actual investments such that the amount payable by the Company at the later date will be based on the actual rate of return of a specific investment (including any decrease as well as any increase in the
value of an investment). 
 (h) Early Exercise. The Award Agreement may, but need not, include a provision whereby the Grantee may
elect at any time while an Employee, Director or Consultant to exercise any part or all of the Award prior to full vesting of the Award. Any unvested Shares received pursuant to such exercise may be subject to a repurchase right in favor of the
Company or a Related Entity or to any other restriction the Administrator determines to be appropriate. 
 (i) Term of Award. The term
of each Award shall be the term stated in the Award Agreement, provided, however, that the term of an Award shall be no more than ten (10) years from the date of grant thereof. However, in the case of an Incentive Stock Option granted to a
Grantee who, at the time the Option is granted, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary of the Company, the term of the Incentive Stock
Option shall be five (5) years from the date of grant thereof or such shorter term as may be provided in the Award Agreement. Notwithstanding the foregoing, the specified term of any Award shall not include any period for which the Grantee has
elected to defer the receipt of the Shares or cash issuable pursuant to the Award. 
 (j) Transferability of Awards. Incentive Stock
Options may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Grantee, only by the Grantee. Other
Awards shall be transferable (i) by will and by the laws of descent and distribution and (ii) during the lifetime of the Grantee, to the extent and in the manner authorized by the Administrator by gift or pursuant to a domestic relations
order to members of the Grantee’s Immediate Family. Notwithstanding the foregoing, the Grantee may designate one or more beneficiaries of the Grantee’s Award in the event of the Grantee’s death on a beneficiary designation form
provided by the Administrator. 
 (k) Time of Granting Awards. The date of grant of an Award shall for all purposes be the date on
which the Administrator makes the determination to grant such Award, or such other later date as is determined by the Administrator. 
  

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 7. Award Exercise or Purchase Price, Consideration and Taxes. 
 (a) Exercise or Purchase Price. The exercise or purchase price, if any, for an Award shall be as follows: 
 (i) In the case of an Incentive Stock Option: 
 (A) granted to an Employee who, at the time of the grant of such Incentive Stock Option owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary of the
Company, the per Share exercise price shall be not less than one hundred ten percent (110%) of the Fair Market Value per Share on the date of grant; or 
 (B) granted to any Employee other than an Employee described in the preceding paragraph, the per Share exercise price shall be not less than one hundred percent (100%) of the Fair Market Value per Share on the
date of grant. 
 (ii) In the case of a Non-Qualified Stock Option, the per Share exercise price shall be determined by the Administrator.

 (iii) In the case of Awards intended to qualify as Performance-Based Compensation, the exercise or purchase price, if any, shall be not
less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant. 
 (iv) In the case of other Awards, such
price as is determined by the Administrator. 
 (v) Notwithstanding the foregoing provisions of this Section 7(a), in the case of an
Award issued pursuant to Section 6(d), above, the exercise or purchase price for the Award shall be determined in accordance with the provisions of the relevant instrument evidencing the agreement to issue such Award. 
 (b) Consideration. Subject to Applicable Laws, the consideration to be paid for the Shares to be issued upon exercise or purchase of an Award
including the method of payment, shall be determined by the Administrator. In addition to any other types of consideration the Administrator may determine, the Administrator is authorized to accept as consideration for Shares issued under the Plan
the following, provided that the portion of the consideration equal to the par value of the Shares must be paid in cash or other legal consideration permitted by the Delaware General Corporation Law: 
 (i) cash; 
 (ii) check; 
 (iii) if the exercise or purchase occurs on or after the Registration Date, surrender of Shares or delivery of a properly executed form of attestation
of ownership of Shares as the Administrator may require which have a Fair Market Value on the date of surrender or attestation equal to the aggregate exercise price of the Shares as to which said Award shall be 

  

 13 

 
exercised, provided, however, that Shares acquired under the Plan or any other equity compensation plan or agreement of the Company must have been held by
the Grantee for a period of more than six (6) months (and not used for another Award exercise by attestation during such period); 
 (iv) with respect to Options, if the exercise occurs on or after the Registration Date, payment through a broker-dealer sale and remittance procedure pursuant to which the Grantee (A) shall provide written instructions to a Company
designated brokerage firm to effect the immediate sale of some or all of the purchased Shares and remit to the Company sufficient funds to cover the aggregate exercise price payable for the purchased Shares and any applicable taxes, fees, and costs
associated with the exercise of the Options; and (B) shall provide written directives to the Company to deliver the certificates for the purchased Shares directly to such brokerage firm in order to complete the sale transaction; or 

(v) any combination of the foregoing methods of payment. 
 The Administrator may at any time or from time to time, by adoption of or by amendment to the standard forms of Award Agreement described in Section 4(b)(iv), or by other means, grant Awards which do not permit all of the foregoing
forms of consideration to be used in payment for the Shares or which otherwise restrict one or more forms of consideration, or grant Awards which require that one or more of the foregoing forms of consideration be used in payment for the Shares.

 (c) Taxes. No Shares shall be delivered under the Plan to any Grantee or other person until such Grantee or other person has made
arrangements acceptable to the Administrator for the satisfaction of any non-U.S., federal, state, or local income and employment tax withholding obligations, including, without limitation, obligations incident to the receipt of Shares. Upon
exercise or vesting of an Award the Company shall withhold or collect from Grantee an amount sufficient to satisfy such tax obligations, including, but not limited too, by surrender of the whole number of Shares covered by the Award sufficient to
satisfy the minimum applicable tax withholding obligations incident to the exercise or vesting of an Award. 
 8. Exercise of Award.

 (a) Procedure for Exercise; Rights as a Stockholder. 
 (i) Any Award granted hereunder shall be exercisable at such times and under such conditions as determined by the Administrator under the terms of the
Plan and specified in the Award Agreement. 
 (ii) An Award shall be deemed to be exercised when written notice of such exercise has been
given to the Company in accordance with the terms of the Award by the person entitled to exercise the Award and full payment for the Shares with respect to which the Award is exercised has been made, including, to the extent selected, use of the
broker-dealer sale and remittance procedure to pay the purchase price as provided in Section 7(b)(iv). 
  

 14 

 (b) Exercise of Award Following Termination of Continuous Service. 
 (i) An Award may not be exercised after the termination date of such Award set forth in the Award Agreement and may be exercised following the
termination of a Grantee’s Continuous Service only to the extent provided in the Award Agreement. 
 (ii) Where the Award Agreement
permits a Grantee to exercise an Award following the termination of the Grantee’s Continuous Service for a specified period, the Award shall terminate to the extent not exercised on the last day of the specified period or the last day of the
original term of the Award, whichever occurs first. 
 (iii) Any Award designated as an Incentive Stock Option to the extent not exercised
within the time permitted by law for the exercise of Incentive Stock Options following the termination of a Grantee’s Continuous Service shall convert automatically to a Non-Qualified Stock Option and thereafter shall be exercisable as such to
the extent exercisable by its terms for the period specified in the Award Agreement. 
 9. Conditions Upon Issuance of Shares.

 (a) Shares shall not be issued pursuant to the exercise of an Award unless the exercise of such Award and the issuance and delivery of
such Shares pursuant thereto shall comply with all Applicable Laws, and shall be further subject to the approval of counsel for the Company with respect to such compliance. 
 (b) As a condition to the exercise of an Award, the Company may require the person exercising such Award to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required by any Applicable Laws. 

10. Adjustments Upon Changes in Capitalization. Subject to any required action by the stockholders of the Company, the number of Shares covered
by each outstanding Award, and the number of Shares which have been authorized for issuance under the Plan but as to which no Awards have yet been granted or which have been returned to the Plan, the exercise or purchase price of each such
outstanding Award, the maximum number of Shares with respect to which Awards may be granted to any Grantee in any calendar year, as well as any other terms that the Administrator determines require adjustment shall be proportionately adjusted for
(i) any increase or decrease in the number of issued Shares resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Shares, or similar transaction affecting the Shares, (ii) any other
increase or decrease in the number of issued Shares effected without receipt of consideration by the Company, or (iii) as the Administrator may determine in its discretion, any other transaction with respect to Common Stock including a
corporate merger, consolidation, acquisition of property or stock, separation (including a spin-off or other distribution of stock or property), reorganization, liquidation (whether partial or complete) or any similar transaction; provided, however
that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.” In the event of any distribution of cash or other assets to stockholders other than a normal cash

  

 15 

 
dividend, the Administrator may also, in its discretion, make adjustments described in (i)-(iii) of this Section 10 or substitute, exchange or
grant Awards with respect to the shares of a Related Entity (collectively “adjustments”). In determining adjustments to be made under this Section 10, the Administrator may take into account such factors as it deems appropriate,
including (x) the restrictions of Applicable Law, (y) the potential tax, accounting or other consequences of an adjustment and (z) the possibility that some Grantees might receive an adjustment and a distribution or other unintended
benefit, and in light of such factors or circumstances may make adjustments that are not uniform or proportionate among outstanding Awards, modify vesting dates, defer the delivery of stock certificates or make other equitable adjustments. Any such
adjustments to outstanding Awards will be effected in a manner that precludes the material enlargement of rights and benefits under such Awards. Adjustments, if any, and any determinations or interpretations, including any determination of whether a
distribution is other than a normal cash dividend, shall be made by the Administrator and its determination shall be final, binding and conclusive. In connection with the foregoing adjustments, the Administrator may, in its discretion, prohibit the
exercise of Awards during certain periods of time. Except as the Administrator determines, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason hereof shall
be made with respect to, the number or price of Shares subject to an Award. 
 11. Corporate Transactions and Changes in Control.

 (a) Termination of Award to Extent Not Assumed in Corporate Transaction. Effective upon the consummation of a Corporate
Transaction, all outstanding Awards under the Plan shall terminate. However, all such Awards shall not terminate to the extent they are Assumed in connection with the Corporate Transaction. 
 (b) Acceleration of Award Upon Corporate Transaction or Change in Control. Except as provided otherwise in an individual Award Agreement, in the
event of any Corporate Transaction or Change in Control, there will not be any acceleration of vesting or exercisability of any Award. 
 12.
Effective Date and Term of Plan. The Plan shall become effective upon the earlier to occur of its adoption by the Board or its approval by the stockholders of the Company. It shall continue in effect for a term of ten (10) years unless
sooner terminated. Subject to Section 17, below, and Applicable Laws, Awards may be granted under the Plan upon its becoming effective. 
 13. Amendment, Suspension or Termination of the Plan. 
 (a) The Board may at any time amend, suspend or terminate the Plan;
provided, however, that no such amendment shall be made without the approval of the Company’s stockholders to the extent such approval is required by Applicable Laws, or if such amendment would lessen the stockholder approval requirements of
Section 4(b)(vi) or this Section 13(a). 
  

 16 

 (b) No Award may be granted during any suspension of the Plan or after termination of the Plan.

 (c) No suspension or termination of the Plan (including termination of the Plan under Section 12, above) shall adversely affect any
rights under Awards already granted to a Grantee. 
 14. Reservation of Shares. 
 (a) The Company, during the term of the Plan, will at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the
requirements of the Plan. 
 (b) The inability of the Company to obtain authority from any regulatory body having jurisdiction, which
authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained. 
 15. No Effect on Terms of Employment/Consulting Relationship. The Plan shall not confer
upon any Grantee any right with respect to the Grantee’s Continuous Service, nor shall it interfere in any way with his or her right or the right of the Company or any Related Entity to terminate the Grantee’s Continuous Service at any
time, with or without Cause, and with or without notice. The ability of the Company or any Related Entity to terminate the employment of a Grantee who is employed at will is in no way affected by its determination that the Grantee’s Continuous
Service has been terminated for Cause for the purposes of this Plan. 
 16. No Effect on Retirement and Other Benefit Plans. Except as
specifically provided in a retirement or other benefit plan of the Company or a Related Entity, Awards shall not be deemed compensation for purposes of computing benefits or contributions under any retirement plan of the Company or a Related Entity,
and shall not affect any benefits under any other benefit plan of any kind or any benefit plan subsequently instituted under which the availability or amount of benefits is related to level of compensation. The Plan is not a “Retirement
Plan” or “Welfare Plan” under the Employee Retirement Income Security Act of 1974, as amended. 
 17. Stockholder
Approval. The grant of Incentive Stock Options under the Plan shall be subject to approval by the stockholders of the Company within twelve (12) months before or after the date the Plan is adopted excluding Incentive Stock Options issued in
substitution for outstanding Incentive Stock Options pursuant to Section 424(a) of the Code. Such stockholder approval shall be obtained in the degree and manner required under Applicable Laws. The Administrator may grant Incentive Stock
Options under the Plan prior to approval by the stockholders, but until such approval is obtained, no such Incentive Stock Option shall be exercisable. In the event that stockholder approval is not obtained within the twelve (12) month period
provided above, all Incentive Stock Options previously granted under the Plan shall be exercisable as Non-Qualified Stock Options. 
 18.
Effect of Section 162(m) of the Code. The Plan, and all Awards issued thereunder, are intended to be exempt from the application of Section 162(m) of the Code, which 

  

 17 

 
restricts under certain circumstances the Federal income tax deduction for compensation paid by a public company to named executives in excess of
$1 million per year. The exemption is based on Treasury Regulation Section 1.162-27(f), in the form existing on the effective date of the Plan, with the understanding that such regulation generally exempts from the application of
Section 162(m) of the Code compensation paid pursuant to a plan that existed before a company becomes publicly held. Under such Treasury Regulation, this exemption is available to the Plan for the duration of the period that lasts until the
earlier of (i) the expiration of the Plan, (ii) the material modification of the Plan, (iii) the exhaustion of the maximum number of shares of Common Stock available for Awards under the Plan, as set forth in Section 3(a),
(iv) the first meeting of stockholders at which directors are to be elected that occurs after the close of the third calendar year following the calendar year in which the Company first becomes subject to the reporting obligations of
Section 12 of the Exchange Act, or (v) such other date required by Section 162(m) of the Code and the rules and regulations promulgated thereunder. To the extent that the Administrator determines as of the date of grant of an Award
that (i) the Award is intended to qualify as Performance-Based Compensation and (ii) the exemption described above is no longer available with respect to such Award, such Award shall not be effective until any stockholder approval required
under Section 162(m) of the Code has been obtained. 
 19. Unfunded Obligation. Grantees shall have the status of general
unsecured creditors of the Company. Any amounts payable to Grantees pursuant to the Plan shall be unfunded and unsecured obligations for all purposes, including, without limitation, Title I of the Employee Retirement Income Security Act of
1974, as amended. Neither the Company nor any Related Entity shall be required to segregate any monies from its general funds, or to create any trusts, or establish any special accounts with respect to such obligations. The Company shall retain at
all times beneficial ownership of any investments, including trust investments, which the Company may make to fulfill its payment obligations hereunder. Any investments or the creation or maintenance of any trust or any Grantee account shall not
create or constitute a trust or fiduciary relationship between the Administrator, the Company or any Related Entity and a Grantee, or otherwise create any vested or beneficial interest in any Grantee or the Grantee’s creditors in any assets of
the Company or a Related Entity. The Grantees shall have no claim against the Company or any Related Entity for any changes in the value of any assets that may be invested or reinvested by the Company with respect to the Plan. 
 20. Construction. Captions and titles contained herein are for convenience only and shall not affect the meaning or interpretation of any
provision of the Plan. Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular. Use of the term “or” is not intended to be exclusive, unless the context clearly
requires otherwise. 
  

 18

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