Document:

Exhibit

Execution Version

FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”), dated as of June 20, 2019 (the “Amendment Effective Date”), is made by and among Apollo Endosurgery, Inc., a Delaware corporation (“Parent”), Apollo Endosurgery US, Inc., a Delaware corporation (“Apollo Endo”), Apollo Endosurgery International LLC, a Delaware limited liability company (“Apollo International”), Lpath Therapeutics Inc., a Delaware corporation (“Lpath”; together with Parent, Apollo Endo and Apollo International, individually and collectively, jointly and severally, “Borrower”), Solar Capital Ltd., a Maryland corporation (“Solar”), in its capacity as collateral agent (in such capacity, together with its successors and assigns in such capacity, “Collateral Agent”) and the Lenders listed on Schedule 1.1 of the Loan and Security Agreement (as defined below) or otherwise a party hereto from time to time including Solar in its capacity as a Lender (each a “Lender” and collectively, the “Lenders”).
The Borrower, the Lenders and Collateral Agent are parties to a Loan and Security Agreement dated as of March 15, 2019 (as amended, restated, modified or supplemented from time to time, the “Loan and Security Agreement”).  The Borrower has requested that the Lenders agree to certain amendments to the Loan and Security Agreement.  The Lenders have agreed to such request, subject to the terms and conditions hereof.
Accordingly, the parties hereto agree as follows:
SECTION 1Definitions; Interpretation.
(a)    Terms Defined in Loan and Security Agreement.  All capitalized terms used in this Amendment (including in the recitals hereof) and not otherwise defined herein shall have the meanings assigned to them in the Loan and Security Agreement.
(b)    Interpretation.  The rules of interpretation set forth in Section 1.1 of the Loan and Security Agreement shall be applicable to this Amendment and are incorporated herein by this reference.
SECTION 2    Amendments to the Loan and Security Agreement.
(a)    The Loan and Security Agreement shall be amended as follows effective as of the Amendment Effective Date: 
(i)    New Definitions.  The following definitions are added to Section 1.3 in their proper alphabetical order: 
“First Amendment” means that certain First Amendment to Loan and Security Agreement, dated as of the First Amendment Effective Date, by and among Borrowers, Collateral Agent and the Lenders party thereto.
“First Amendment Effective Date” means June 20, 2019.
“Qualified Cash Amount” means Twelve Million Five Hundred Thousand Dollars ($12,500,000); provided that if Borrower (i) maintains compliance with Section 7.13(b) hereof for each of the trailing six month periods ending October 31, 2019, November 30, 2019 and December 31, 2019 and (ii) receives, after the First Amendment Effective Date, unrestricted (including, not subject to any redemption, clawback, escrow or similar encumbrance or restriction) net cash proceeds of not less than Thirteen Million Five Hundred Thousand Dollars ($13,500,000) from one or more bona fide equity financings or Subordinated Debt, in each case subject to verification by Collateral Agent (including supporting documentation requested by Collateral Agent), the Qualified Cash Amount shall be Ten Million Dollars ($10,000,000). 

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(ii)    Section 7.13 is hereby amended by amending and restating Section 7.13 in its entirety as follows: 
7.13    Financial Covenants.
(a)    Minimum Liquidity Requirement.  Permit, at any time prior to the Minimum Liquidity Release Date, Qualified Cash to be less than an amount equal to (i) the Qualified Cash Amount plus (ii) the Qualified Cash A/P Amount; provided that if on or before September 30, 2021, Borrower provides evidence satisfactory to Agent that Borrower has achieved EBITDA of at least $5,000,000 for the trailing six-month period ending September 30, 2021, then Borrower shall not be required to maintain minimum Qualified Cash following the date such evidence is provided (the “Minimum Liquidity Release Date”).  
(b)    Minimum Specified Product Revenue.  Permit Specified Product Revenue, measured on a trailing six-month basis on the last day of each month, to be lower than the following:
	
		
	Month-End
	Specified Product Revenue

	June 2019
	$22,000,000

	July 2019
	$22,000,000

	August 2019
	$22,500,000

	September 2019 and each month through and including December 2019
	85% of Total Product Revenue as indicated in a plan submitted by Borrower to Lenders prior to the Effective Date

	January 2020 and each month through and including December 2021
	80% of projected Specified Product Revenue in accordance with an annual plan submitted by Borrower to Lenders pursuant to Section 6.2(a)(iv), such plan to be approved by Borrower’s board of directors and by Agent and Lenders in writing

	January 2022 and each month thereafter
	75% of projected Specified Product Revenue in accordance with an annual plan submitted by Borrower to Lenders pursuant to Section 6.2(a)(iv), such plan to be approved by Borrower’s board of directors and by Agent and Lenders in writing

(iii)    Exhibit D to the Loan and Security Agreement is hereby amended and restated in its entirety in the form attached hereto as Exhibit A.
(b)    References Within Loan and Security Agreement.  Each reference in the Loan and Security Agreement to “this Agreement” and the words “hereof,” “herein,” “hereunder,” or words of like import, shall mean and be a reference to the Loan and Security Agreement as amended by this Amendment.

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SECTION 3    Conditions of Effectiveness.  The effectiveness of Section 2 of this Amendment shall be subject to the satisfaction of each of the following conditions precedent:
(a)    Fees and Expenses.  The Borrower shall have paid (i) an amendment fee of Thirty Five Thousand Dollars ($35,000), which shall be deemed fully earned and non-refundable upon payment, (ii) all invoiced costs and expenses then due in accordance with Section 5(e), and (iii) all other fees, costs and expenses, if any, due and payable as of the Amendment Effective Date under the Loan and Security Agreement. 
(b)    This Amendment.  Collateral Agent shall have received this Amendment, executed by the Borrower.
(c)    Officer’s Certificate.  Collateral Agent shall have received a certificate of an officer of each Borrower with respect to incumbency and resolutions authorizing the execution and delivery of this Amendment, in form acceptable to Collateral Agent and the Lenders.
(d)    Representations and Warranties; No Default.  On the Amendment Effective Date, after giving effect to the amendment of the Loan and Security Agreement contemplated hereby:
(i)    The representations and warranties contained in Section 4 shall be true and correct on and as of the Amendment Effective Date as though made on and as of such date; and
(ii)    There exist no Events of Default or events that with the passage of time would result in an Event of Default.
SECTION 4    Representations and Warranties.  To induce the Lenders to enter into this Amendment, the Borrower hereby confirms, as of the date hereof, (a) that the representations and warranties made by it in Section 5 of the Loan and Security Agreement and in the other Loan Documents are true and correct in all material respects; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; (b) that there has not been and there does not exist a Material Adverse Change; and (c) that the information included in the Perfection Certificate delivered to Collateral Agent on the Effective Date remains true and correct.   For the purposes of this Section 4, (i) each reference in Section 5 of the Loan and Security Agreement to “this Agreement,” and the words “hereof,” “herein,” “hereunder,” or words of like import in such Section, shall mean and be a reference to the Loan and Security Agreement as amended by this Amendment, and (ii) any representations and warranties which relate solely to an earlier date shall not be deemed confirmed and restated as of the date hereof (provided that such representations and warranties shall be true, correct and complete in all material respects as of such earlier date).
SECTION 5    Miscellaneous.
(a)    Loan Documents Otherwise Not Affected; Reaffirmation.  Except as expressly amended pursuant hereto or referenced herein, the Loan and Security Agreement and the other Loan Documents shall remain unchanged and in full force and effect and are hereby ratified and confirmed in all respects.  The Lenders’ and Collateral Agent’s execution and delivery of, or acceptance of, this Amendment shall not be deemed to create a course of dealing or otherwise create any express or implied duty by any of them to provide any other or further amendments, consents or waivers in the future.  The Borrower hereby reaffirms the grant of security under Section 4.1 of the Loan and Security Agreement and hereby reaffirms that such grant of security in the Collateral secures all Obligations under the Loan and Security Agreement, including without limitation any Term Loans funded on or after the Amendment Effective Date, as of the date hereof.
(b)    Conditions.  For purposes of determining compliance with the conditions specified in Section 3, each Lender that has signed this Amendment shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless Collateral Agent shall have received notice from such Lender prior to the Amendment Effective Date specifying its objection thereto.

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(c)    Release.  In consideration of the agreements of Collateral Agent and each Lender contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower, on behalf of itself and its successors, assigns, and other legal representatives, hereby fully, absolutely, unconditionally and irrevocably releases, remises and forever discharges Collateral Agent and each Lender, and its successors and assigns, and its present and former shareholders, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents and other representatives (Agent, Lenders and all such other persons being hereinafter referred to collectively as the “Releasees” and individually as a “Releasee”), of and from all demands, actions, causes of action, suits, covenants, contracts, controversies, agreements, promises, sums of money, accounts, bills, reckonings, damages and any and all other claims, counterclaims, defenses, rights of set-off, demands and liabilities whatsoever of every name and nature, known or unknown, suspected or unsuspected, both at law and in equity, which Borrower, or any of its successors, assigns, or other legal representatives may now or hereafter own, hold, have or claim to have against the Releasees or any of them for, upon, or by reason of any circumstance, action, cause or thing whatsoever which arises at any time on or prior to the day and date of this Amendment, including, without limitation, for or on account of, or in relation to, or in any way in connection with the Loan Agreement, or any of the other Loan Documents or transactions thereunder or related thereto.  Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.  Borrower agrees that no fact, event, circumstance, evidence or transaction which could now be asserted or which may hereafter be discovered shall affect in any manner the final, absolute and unconditional nature of the release set forth above.
(d)    No Reliance.  The Borrower hereby acknowledges and confirms to Collateral Agent and the Lenders that the Borrower is executing this Amendment on the basis of its own investigation and for its own reasons without reliance upon any agreement, representation, understanding or communication by or on behalf of any other Person.
(e)    Costs and Expenses.  The Borrower agrees to pay to Collateral Agent within ten (10) days of its receipt of an invoice (or on the Amendment Effective Date to the extent invoiced on or prior to the Amendment Effective Date), the reasonable out-of-pocket costs and expenses of Collateral Agent and the Lenders party hereto, and the reasonable fees and disbursements of counsel to Collateral Agent and the Lenders party hereto  (including allocated costs of internal counsel), in connection with the negotiation, preparation, execution and delivery of this Amendment and any other documents to be delivered in connection herewith on the Amendment Effective Date or after such date.
(f)    Binding Effect.  This Amendment binds and is for the benefit of the successors and permitted assigns of each party.  
(g)    Governing Law.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES THAT WOULD RESULT IN THE APPLICATION OF ANY LAWS OTHER THAN THE LAWS OF THE STATE OF NEW YORK), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, REGARDLESS OF THE LOCATION OF THE COLLATERAL.
(h)    Complete Agreement; Amendments; Exit Fee Agreement.  This Amendment and the Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements with respect to such subject matter.  All prior agreements, understandings, representations, warranties, and negotiations between the parties about the subject matter of this Amendment and the Loan Documents merge into this Amendment and the Loan Documents.  For the avoidance of doubt and notwithstanding anything to the contrary in this Amendment, Borrower (a) reaffirms its obligations under the Exit Fee Agreement, including without limitation its obligation to pay the Exit Fee (as defined in the Exit Fee Agreement) if and when due thereunder, and (b) agrees that the defined term “Loan Agreement” as defined in the Exit Fee Agreement shall on and after the Amendment Effective Date mean the Loan and Security Agreement as amended by this Amendment and as may be amended, restated or modified from time to time on or after the Amendment Effective Date. 

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(i)    Severability of Provisions.  Each provision of this Amendment is severable from every other provision in determining the enforceability of any provision.
(j)    Counterparts.  This Amendment may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, is an original, and all taken together, constitute one Amendment.  Delivery of an executed counterpart of a signature page of this Amendment by facsimile, portable document format (.pdf) or other electronic transmission will be as effective as delivery of a manually executed counterpart hereof.
(k)    Loan Documents. This Amendment and the documents related thereto shall constitute Loan Documents.
[Balance of Page Intentionally Left Blank; Signature Pages Follow] 

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US-DOCS\108919170.7

IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment, as of the date first above written.
	
			
	BORROWER:
	 
	 

	 
	 
	 

	APOLLO ENDOSURGERY, INC.
	 
	APOLLO ENDOSURGERY INTERNATIONAL, LLC

	 
	 
	 

	 
	 
	 

	By                                    /s/   
	 
	By                                    /s/   

	Name: Stefanie Cavanaugh   
	 
	Name: Stefanie Cavanaugh   

	Title: Chief Financial Officer   
	 
	Title: Chief Financial Officer   

	 
	 
	 

	 
	 
	 

	APOLLO ENDOSURGERY US, INC.
	 
	LPATH THERAPEUTICS INC.

	 
	 
	 

	 
	 
	 

	 
	 
	 

	By                                    /s/   
	 
	By                                    /s/   

	Name: Stefanie Cavanaugh   
	 
	Name: Stefanie Cavanaugh   

	 
	 
	 

[Signature Page to First Amendment to Loan and Security Agreement (Apollo Endo/Solar)]

	
		
	GUARANTOR:
	 

	 
	 

	APOLLO ENDOSURGERY UK LTD
	 

	 
	 

	 
	 

	By                                    /s/   
	 

	Name: Stefanie Cavanaugh   
	 

	Title: Director   
	 

	 
	 

	 
	 

	 
	 

[Signature Page to First Amendment to Loan and Security Agreement (Apollo Endo/Solar)]

	
		
	GUARANTOR:
	 

	 
	 

	APOLLO ENDOSURGERY COSTA RICA S.R.L.
	 

	 
	 

	 
	 

	By                                    /s/   
	 

	Name: Todd Newton   
	 

	Title: Manager   
	 

	 
	 

	 
	 

	 
	 

	 
	 

STATE OF  Texas                    )
) ss.
COUNTY OF  Travis                    )

On June 10th    ,   2019,   before   me,   the   undersigned   Notary   Public,   personally        appeared
 Todd Newton      (name of signer), personally known to me or proved to me on the basis of satisfactory evidence of identification, which were 10953171    (license), to be the person(s) whose name is signed on the preceding or attached document, and acknowledge to me that he/she/they signed it voluntarily and for its stated purpose.

WITNESS my hand and official seal.
SEAL

________________/s/________________
Margaret Rose Keller
Notary Public in and for said State

[Signature Page to First Amendment to Loan and Security Agreement (Apollo Endo/Solar)]

	
			
	 
	 
	 

	COLLATERAL AGENT:
	 
	 

	 
	 
	 

	SOLAR CAPITAL LTD.

	 
	 
	 

	 
	 
	 

	By                                    /s/   
	 
	 

	Name: Anthony J. Storino   
	 
	 

	Title: Authorized Signatory   
	 
	 

	 
	 
	 

[Signature Page to First Amendment to Loan and Security Agreement (Apollo Endo/Solar)]

LENDER:

	
			
	 
	 
	 

	LENDER:
	 
	 

	 
	 
	 

	SOLAR CAPITAL LTD.

	 

	 

	By                                    /s/   

	Name: Anthony J. Storino   

	Title: Authorized Signatory   

	 

	SCP PRIVATE CREDIT INCOME FUND SPV LLC

	 
	 
	 

	 
	 
	 

	By                                    /s/   
	 
	 

	Name: Anthony J. Storino   
	 
	 

	Title: Authorized Signatory   
	 
	 

	 
	 
	 

	SCP PRIVATE CREDIT INCOME BDC SPV LLC

	 
	 
	 

	 
	 
	 

	By                                    /s/   
	 
	 

	Name: Anthony J. Storino   
	 
	 

	Title: Authorized Signatory   
	 
	 

[Signature Page to First Amendment to Loan and Security Agreement (Apollo Endo/Solar)]

EXHIBIT A
EXHIBIT D 
 
Compliance Certificate
	
		
	TO:
	SOLAR CAPITAL LTD., as Collateral Agent and Lender

	FROM:
	Apollo Endosurgery US, Inc.

The undersigned authorized officer (“Officer”) of Apollo Endosurgery US, Inc. (“Borrower”), hereby certifies that in accordance with the terms and conditions of the Loan and Security Agreement dated as of March 15, 2019, by and among Borrower, Apollo Endosurgery, Inc., Apollo Endosurgery International LLC, Lpath Therapeutics Inc., Apollo Endosurgery UK Ltd, Apollo Endosurgery Costa Rica S.R.L., Collateral Agent, and the Lenders from time to time party thereto (the “Loan Agreement;” capitalized terms used but not otherwise defined herein shall have the meanings given them in the Loan Agreement),
(a)    Each Loan Party is in complete compliance for the period ending _______________ with all required covenants except as noted below;
(b)    There are no defaults or Events of Default, except as noted below;
(c)    Except as noted below, all representations and warranties of each Loan Party stated in the Loan Documents are true and correct in all material respects on this date and for the period described in (a), above; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date.
(d)    Each Loan Party, and each of each Loan Party’s Subsidiaries, has timely filed all required tax returns and reports, each Loan Party, and each of each Loan Party’s Subsidiaries, has timely paid all foreign, federal, state, and local taxes, assessments, deposits and contributions owed by each Loan Party, or Subsidiary, except, in each case as otherwise permitted pursuant to the terms of Section 5.8 of the Loan Agreement;
(e)    No Liens have been levied or claims made against any Loan Party or any of its Subsidiaries relating to unpaid employee payroll or benefits of which any Loan Party has not previously provided written notification to Collateral Agent and the Lenders.
Attached are the required documents, if any, supporting our certification(s).  The Officer, on behalf of each Loan Party, further certifies that the attached financial statements are prepared in accordance with Generally Accepted Accounting Principles (GAAP) and are consistently applied from one period to the next except as explained in an accompanying letter or footnotes and except, in the case of unaudited financial statements, for the absence of footnotes and subject to year‐end audit adjustments as to the interim financial statements.  
Please indicate compliance status since the last Compliance Certificate by circling Yes, No, or N/A under “Complies” column.

US-DOCS\108919170.7

	
							
	 
	Reporting Covenant
	Requirement
	Actual
	Complies

	1)
	Monthly financial statements
	Monthly within 30 days
	 
	Yes
	No
	N/A

	2)
	Quarterly financial statements
	Quarterly within 45 days
	 
	Yes
	No
	N/A

	3)
	Annual (CPA Audited) statements
	Within 90 days after FYE
	 
	Yes
	No
	N/A

	4)
	Annual Financial Projections/Budget (prepared on a monthly basis)
	Annually (within earlier 10 days of approval or February 28 of such year), and when revised
	 
	Yes
	No
	N/A

	5)
	Compliance Certificate
	Monthly within 30 days
	 
	Yes
	No
	N/A

	6)
	IP Report
	When required
	 
	Yes
	No
	N/A

	7)
	Total amount of Borrower’s cash and cash equivalents at the last day of the measurement period
	 
	$________
	Yes
	No
	N/A

	8)
	Total amount of Borrower’s Subsidiaries’ cash and cash equivalents at the last day of the measurement period
	 
	$________
	Yes
	No
	N/A

Updates to Deposit and Securities Accounts
(Please list all new accounts since the last Compliance Certificate; attach separate sheet if additional space needed)

	
							
	 
	Institution Name
	Account Number
	New Account?
	Account Control Agreement in place?

	1)
	 
	 
	Yes
	No
	Yes
	No

	2)
	 
	 
	Yes
	No
	Yes
	No

	3)
	 
	 
	Yes
	No
	Yes
	No

	4)
	 
	 
	Yes
	No
	Yes
	No

Financial Covenants

	
					
	 
	Minimum Liquidity Covenant
	(A) Qualified Cash
	(B) A/P not paid within 120 days from invoice date
	Complies with Minimum Liquidity Requirement (Is (B) plus ($12,500,000/$10,000,000) less than (A))?

	 
	 
	 
	 
	 

	 
	Minimum Specified Product Revenue (period ending __________)
	(A) Actual Specified Product Revenue $___________
	(B) Minimum Specified Product Revenue per Section 7.13(b) $____________
	Complies with Minimum Specified Product Revenue (Is (A) greater than or equal to (B))?

	 
	 
	 
	 
	 

Other Matters

US-DOCS\108919170.7

	
				
	1)
	Have there been any changes in Key Persons since the last Compliance Certificate?
	Yes
	No

	 
	 
	 
	 

	2)
	Have there been any transfers/sales/disposals/retirement of Collateral or IP prohibited by the Loan Agreement?
	Yes
	No

	 
	 
	 
	 

	3)
	Have there been any new or pending claims or causes of action against any Loan Party that involve more than Five Hundred Thousand Dollars ($500,000.00)?
	Yes
	No

	 
	 
	 
	 

	4)
	Has any Loan Party or any Subsidiary entered into or amended any Material Agreement?  If yes, please explain and provide a copy of the Material Agreement(s) and/or amendment(s).

	Yes
	No

	5)
	Has each Loan Party provided the Collateral Agent with all notices required to be delivered under Sections 6.2(a) and 6.2(b) of the Loan Agreement?
	Yes
	No

US-DOCS\108919170.7

Exceptions

Please explain any exceptions with respect to the certification above: (If no exceptions exist, state “No exceptions.”  Attach separate sheet if additional space needed.)

APOLLO ENDOSURGERY US, INC.

By:                  
Name:                  
Title:                  

Date:

	
		
	COLLATERAL AGENT USE ONLY

	 
	 

	Received by:             
	Date:        

	 
	 

	Verified by:              
	Date:        

	 
	 

	Compliance Status:   Yes      No   

US-DOCS\108919170.7Exhibit
10.1

 

PAVmed
Inc.

 

Third
Amended and Restated 2014 Long-Term Incentive Equity Plan

 

Section
1. Purpose; Definitions.

 

1.1.
Purpose. The purpose of the PAVmed Inc. 2014 Long-Term Incentive Equity Plan (“Plan”) is to enable the Company
to offer to its employees, officers, directors and consultants whose past, present and/or potential future contributions to the
Company and its Subsidiaries have been, are or will be important to the success of the Company, an opportunity to acquire a proprietary
interest in the Company. The various types of long-term incentive awards that may be provided under
the Plan will enable the Company to respond to changes in compensation practices, tax laws, accounting regulations and the size
and diversity of its businesses.

 

1.2.
Definitions. For purposes of the Plan, the following terms shall be defined as set forth below:

 

(a)
“Agreement” means the agreement between the Company and the Holder, or such other document as may be determined by
the Committee, setting forth the terms and conditions of an award under the Plan.

 

(b)
“Board” means the Board of Directors of the Company.

 

(c)
“Code” means the Internal Revenue Code of 1986, as amended from time to time.

 

(d)
“Committee” means the committee of the Board designated to administer the Plan as provided in Section 2.1. If no Committee
is so designated, then all references in this Plan to “Committee” shall mean the Board.

 

(e)
“Common Stock” means the Common Stock of the Company, par value $0.001 per share.

 

(f)
“Company” means PAVmed Inc., a corporation organized under the laws of the State of Delaware.

 

(g)
“Disability” means physical or mental impairment as determined under procedures established by the Committee for purposes
of the Plan.

 

(h)
“Effective Date” means the date determined pursuant to Section 11.1.

 

(i)
“Fair Market Value,” unless otherwise required by any applicable provision of the Code or any regulations issued thereunder,
means, as of any given date: (i) if the Common Stock is listed on a national securities exchange or The Nasdaq Stock Market, LLC
(“Nasdaq”) or is traded on the OTC Bulletin Board (“OTC”), the last sale price of the Common Stock in
the principal trading market for the Common Stock on such date, as reported by the exchange, Nasdaq or OTC, as the case may be;
(ii) if the fair market value of the Common Stock cannot be determined pursuant to clause (i) above, such price as the Committee
shall determine, in good faith.

 

(j)
“Holder” means a person who has received an award under the Plan.

 

    	 	 	 

    	 	 	 

    

 

(k)
“Incentive Stock Option” means any Stock Option intended to be and designated as an “incentive stock option”
within the meaning of Section 422 of the Code.

 

(l)
“Non-qualified Stock Option” means any Stock Option that is not an Incentive Stock Option.

 

(m)
“Normal Retirement” means retirement from active employment with the Company or any Subsidiary on or after such age
which may be designated by the Committee as “retirement age” for any particular Holder. If no age is designated, it
shall be 65.

 

(n)
“Other Stock-Based Award” means an award under Section 9 that is valued in whole or in part by reference to, or is
otherwise based upon, Common Stock.

 

(o)
“Parent” means any present or future “parent corporation” of the Company, as such term is defined in Section
424(e) of the Code.

 

(p)
“Plan” means the PAVmed Inc. 2014 Long-Term Incentive Equity Plan, as hereinafter amended from time to time.

 

(q)
“Repurchase Value” shall mean the Fair Market Value if the award to be settled under Section 2.2(e) or repurchased
under Section 5.2(k) or 9.2 is comprised of shares of Common Stock and the difference between Fair Market Value and the Exercise
Price (if lower than Fair Market Value) if the award is a Stock Option or Stock Appreciation Right; in each case, multiplied by
the number of shares subject to the award.

 

(r)
“Restricted Stock” means Common Stock received under an award made pursuant to Section 7 that is subject to restrictions
under Section 7.

 

(s)
“SAR Value” means the excess of the Fair Market Value (on the exercise date) over (a) the exercise price that the
participant would have otherwise had to pay to exercise the related Stock Option or (b) if a Stock Appreciation Right is granted
unrelated to a Stock Option, the Fair Market Value of a share of Common Stock on the date of grant of the Stock Appreciation Right,
in either case, multiplied by the number of shares for which the Stock Appreciation Right is exercised.

 

(t)
“Stock Appreciation Right” means the right to receive from the Company, without a cash payment to the Company, a number
of shares of Common Stock equal to the SAR Value divided by the Fair Market Value (on the exercise date).

 

(u)
“Stock Option” or “Option” means any option to purchase shares of Common Stock which is granted pursuant
to the Plan.

 

(v)
“Subsidiary” means any present or future “subsidiary corporation” of the Company, as such term is defined
in Section 424(f) of the Code.

 

(w)
“Vest” means to become exercisable or to otherwise obtain ownership rights in an award.

 

    	 	2	 

    	 	 	 

    

 

Section
2. Administration.

 

2.1.
Committee Membership. The Plan shall be administered by the Board or a Committee. If administered by a Committee, such
Committee shall be composed of at least two directors, all of whom are “outside directors” within the meaning of the
regulations issued under Section 162(m) of the Code and “non-employee” directors within the meaning of Rule 16b-3
under the Securities Exchange Act of 1934, as amended. Committee members shall serve for such term as the Board may in each case
determine and shall be subject to removal at any time by the Board.

 

2.2.
Powers of Committee. The Committee shall have full authority to award, pursuant to the terms of the Plan: (i) Stock Options,
(ii) Stock Appreciation Rights, (iii) Restricted Stock, and/or (iv) Other Stock-Based Awards. For purposes of illustration and
not of limitation, the Committee shall have the authority (subject to the express provisions of this Plan):

 

(a)
to select the officers, employees, directors and consultants of the Company or any Subsidiary to whom Stock Options, Stock Appreciation
Rights, Restricted Stock and/or Other Stock-Based Awards may from time to time be awarded hereunder;

 

(b)
to determine the terms and conditions, not inconsistent with the terms of the Plan, of any award granted hereunder (including,
but not limited to, number of shares, share exercise price or types of consideration paid upon exercise of such options, such
as other securities of the Company or other property, any restrictions or limitations, and any vesting, exchange, surrender, cancellation,
acceleration, termination, exercise or forfeiture provisions, as the Committee shall determine);

 

(c)
to determine any specified performance goals or such other factors or criteria which need to be attained for the vesting of an
award granted hereunder;

 

(d)
to determine the terms and conditions under which awards granted hereunder are to operate on a tandem basis and/or in conjunction
with or apart from other equity awarded under this Plan and cash and non-cash awards made by the Company or any Subsidiary outside
of this Plan; and

 

(e)
to make payments and distributions with respect to awards (i.e., to “settle” awards) through cash payments
in an amount equal to the Repurchase Value.

 

The
Committee may not modify or amend any outstanding Option or Stock Appreciation Right to reduce the exercise price of such Option
or Stock Appreciation Right, as applicable, below the exercise price as of the date of grant of such Option or Stock Appreciation
Right. In addition, no Option or Stock Appreciation Right may be granted in exchange for the cancellation or surrender of an Option
or Stock Appreciation Right or other award having a higher exercise price.

 

Notwithstanding
anything to the contrary, the Committee shall not grant to any one Holder in any one calendar year awards for more than 10% of
the total number of Shares (as defined below) issued and available for issuance under the Plan, in the aggregate.

 

    	 	3	 

    	 	 	 

    

 

2.3.
Interpretation of Plan.

 

(a)
Committee Authority. Subject to Section 10, the Committee shall have the authority to adopt, alter and repeal such administrative
rules, guidelines and practices governing the Plan as it shall from time to time deem advisable to interpret the terms and provisions
of the Plan and any award issued under the Plan (and to determine the form and substance of all agreements relating thereto),
and to otherwise supervise the administration of the Plan. Subject to Section 10, all decisions made
by the Committee pursuant to the provisions of the Plan shall be made in the Committee’s sole discretion and shall be final
and binding upon all persons, including the Company, its Subsidiaries and Holders.

 

(b)
Incentive Stock Options. Anything in the Plan to the contrary notwithstanding, no term or provision of the Plan relating
to Incentive Stock Options (including but not limited to Stock Appreciation rights granted in conjunction with an Incentive Stock
Option) or any Agreement providing for Incentive Stock Options shall be interpreted, amended or altered, nor shall any discretion
or authority granted under the Plan be so exercised, so as to disqualify the Plan under Section 422
of the Code or, without the consent of the Holder(s) affected, to disqualify any Incentive Stock Option under such Section 422.

 

Section
3. Stock Subject to Plan.

 

3.1.
Number of Shares. Subject to Section 7.1(d), the total number of shares of Common Stock reserved and available for issuance
under the Plan shall be 7,951,081 shares. Shares of Common Stock under the Plan (“Shares”) may consist, in whole or
in part, of authorized and unissued shares or treasury shares. If any shares of Common Stock that have been granted pursuant to
a Stock Option cease to be subject to a Stock Option, or if any shares of Common Stock that are subject to any Stock Appreciation
Right, Restricted Stock award or Other Stock-Based Award granted hereunder are forfeited, or any such
award otherwise terminates without a payment being made to the Holder in the form of Common Stock, such shares shall again be
available for distribution in connection with future grants and awards under the Plan. Shares of Common Stock that are surrendered
by a Holder or withheld by the Company as full or partial payment in connection with any award under the Plan, as well as any
shares of Common Stock surrendered by a Holder or withheld by the Company or one of its Subsidiaries to satisfy the tax withholding
obligations related to any award under the Plan, shall not be available for subsequent awards under the Plan.

 

3.2.
Adjustment Upon Changes in Capitalization, Etc. In the event of any common stock dividend payable on shares of Common Stock,
Common Stock split or reverse split, combination or exchange of shares of Common Stock, or other extraordinary or unusual event
which results in a change in the shares of Common Stock of the Company as a whole, the Committee shall determine, in its sole
discretion, whether such change equitably requires an adjustment in the terms of any award in order to prevent dilution or enlargement
of the benefits available under the Plan (including number of shares subject to the award and the exercise price) or the aggregate
number of shares reserved for issuance under the Plan. Any such adjustments will be made by the Committee, whose determination
will be final, binding and conclusive.

 

    	 	4	 

    	 	 	 

    

 

Section
4. Eligibility.

 

Awards
may be made or granted to employees, officers, directors and consultants who are deemed to have rendered or to be able to render
significant services to the Company or its Subsidiaries and who are deemed to have contributed or to have the potential to contribute
to the success of the Company and which recipients are qualified to receive options under the regulations governing Form S-8 registration
statements under the Securities Act of 1933, as amended (“Securities Act”). No Incentive Stock Option shall be granted
to any person who is not an employee of the Company or an employee of a Subsidiary at the time of grant
or so qualified as set forth in the immediately preceding sentence. Notwithstanding the foregoing, an award may also be made or
granted to a person in connection with his hiring or retention, or at any time on or after the date he reaches an agreement (oral
or written) with the Company with respect to such hiring or retention, even though it may be prior to the date the person first
performs services for the Company or its Subsidiaries; provided, however, that no portion of any such award shall vest prior to
the date the person first performs such services and the date of grant shall be deemed to be the date hiring or retention commences.

 

Section
5. Stock Options.

 

5.1.
Grant and Exercise. Stock Options granted under the Plan may be of two types: (i) Incentive Stock Options and (ii) Non-qualified
Stock Options. Any Stock Option granted under the Plan shall contain such terms, not inconsistent with this Plan, or with respect
to Incentive Stock Options, not inconsistent with the Plan and the Code, as the Committee may from time to time approve. The Committee
shall have the authority to grant Incentive Stock Options or Non-qualified Stock Options, or both types
of Stock Options which may be granted alone or in addition to other awards granted under the Plan. To the extent that any Stock
Option intended to qualify as an Incentive Stock Option does not so qualify, it shall constitute a separate Non-qualified
Stock Option.

 

5.2.
Terms and Conditions. Stock Options granted under the Plan shall be subject to the following terms and conditions:

 

(a)
Option Term. The term of each Stock Option shall be fixed by the Committee; provided, however, that an Incentive Stock
Option may be granted only within the ten-year period commencing from the Effective Date and may only be exercised within ten
years of the date of grant (or five years in the case of an Incentive Stock Option granted to an optionee who, at the time of
grant, owns Common Stock possessing more than 10% of the total combined voting power of all classes
of voting stock of the Company (“10% Shareholder”)).

 

(b)
Exercise Price. The exercise price per share of Common Stock purchasable under a Stock Option shall be determined by the
Committee at the time of grant and may not be less than 100% of the Fair Market Value on the date of grant (or, if greater, the
par value of a share of Common Stock); provided, however, that the exercise price of an Incentive Stock Option granted to a 10%
Shareholder will not be less than 110% of the Fair Market Value on the date of grant.

 

(c)
Exercisability. Stock Options shall be exercisable at such time or times and subject to such terms and conditions as shall
be determined by the Committee. The Committee intends generally to provide that Stock Options be exercisable only in installments,
i.e., that they vest over time, typically over a four-year period. The Committee may waive such installment
exercise provisions at any time at or after the time of grant in whole or in part, based upon such factors as the Committee determines.
Notwithstanding the foregoing, in the case of an Incentive Stock Option, the aggregate Fair Market Value (on the date of grant
of the Option) with respect to which Incentive Stock Options become exercisable for the first time by a Holder during any calendar
year (under all such plans of the Company and its Parent and Subsidiaries) shall not exceed $100,000.

 

    	 	5	 

    	 	 	 

    

 

(d)
Method of Exercise. Subject to whatever installment, exercise and waiting period provisions are applicable in a particular
case, Stock Options may be exercised in whole or in part at any time during the term of the Option by giving written notice of
exercise to the Company specifying the number of shares of Common Stock to be purchased. Such notice shall be accompanied by payment
in full of the purchase price, which shall be in cash or, if provided in the Agreement, either in shares of Common Stock (including
Restricted Stock and other contingent awards under this Plan) or partly in cash and partly in such Common Stock, or such other
means which the Committee determines are consistent with the Plan’s purpose and applicable law. Cash payments shall be made
by wire transfer, certified or bank check or personal check, in each case payable to the order of the Company; provided, however,
that the Company shall not be required to deliver certificates for shares of Common Stock with respect to which an Option is exercised
until the Company has confirmed the receipt of good and available funds in payment of the purchase price thereof (except that,
in the case of an exercise arrangement approved by the Committee and described in the last sentence of this paragraph, payment
may be made as soon as practicable after the exercise). The Committee may permit a Holder to elect
to pay the Exercise Price upon the exercise of a Stock Option by irrevocably authorizing a third party to sell shares of Common
Stock (or a sufficient portion of the shares) acquired upon exercise of the Stock Option and remit to the Company a sufficient
portion of the sale proceeds to pay the entire Exercise Price and any tax withholding resulting from such exercise.

 

(e)
Stock Payments. Payments in the form of Common Stock shall be valued at the Fair Market Value on the date of exercise.
Such payments shall be made by delivery of stock certificates in negotiable form that are effective to transfer good and valid
title thereto to the Company, free of any liens or encumbrances.

 

(f)
Transferability. Except as may be set forth in the next sentence of this Section or in the Agreement, no Stock Option shall
be transferable by the Holder other than by will or by the laws of descent and distribution, and all Stock Options shall be exercisable,
during the Holder’s lifetime, only by the Holder (or, to the extent of legal incapacity or incompetency,
the Holder’s guardian or legal representative). Notwithstanding the foregoing, a Holder, with the approval of the Committee,
may transfer a Non-Qualified Stock Option (i) (A) by gift, for no consideration, or (B) pursuant to a domestic relations order,
in either case, to or for the benefit of the Holder’s “Immediate Family” (as defined below), or (ii) to an entity
in which the Holder and/or members of Holder’s Immediate Family own more than fifty percent of the voting interest, subject
to such limits as the Committee may establish and the execution of such documents as the Committee may require, and the transferee
shall remain subject to all the terms and conditions applicable to the Non-Qualified Stock Option prior to such transfer. The
term “Immediate Family” shall mean 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 Holder’s household (other than a tenant or employee), a trust in which these
persons have more than fifty percent beneficial interest, and a foundation in which these persons (or the Holder) control
the management of the assets. The Committee may, in its sole discretion, permit transfer of an Incentive Stock Option in a manner
consistent with applicable tax and securities law upon the Holder’s request.

 

    	 	6	 

    	 	 	 

    

 

(g)
Termination by Reason of Death. If a Holder’s employment by, or association with, the Company or a Subsidiary terminates
by reason of death, any Stock Option held by such Holder, unless otherwise determined by the Committee and set forth in the Agreement,
shall thereupon automatically terminate, except that the portion of such Stock Option that has vested on the date of death may
thereafter be exercised by the legal representative of the estate or by the legatee of the Holder under
the will of the Holder, for a period of one year (or such other greater or lesser period as the Committee may specify in the Agreement)
from the date of such death or until the expiration of the stated term of such Stock Option, whichever period is shorter.

 

(h)
Termination by Reason of Disability. If a Holder’s employment by, or association with, the Company or any Subsidiary
terminates by reason of Disability, any Stock Option held by such Holder, unless otherwise determined by the Committee and set
forth in the Agreement, shall thereupon automatically terminate, except that the portion of such Stock Option that has vested
on the date of termination may thereafter be exercised by the Holder for a period of one year (or such other greater
or lesser period as the Committee may specify in the Agreement) from the date of such termination or until the expiration of the
stated term of such Stock Option, whichever period is shorter.

 

(i)
Termination by Reason of Normal Retirement. Subject to the provisions of Section 12.3, if such Holder’s employment
by, or association with, the Company or any Subsidiary terminates due to Normal Retirement, any Stock Option held by such Holder,
unless otherwise determined by the Committee and set forth in the Agreement, shall thereupon automatically terminate, except that
the portion of such Stock Option that has vested on the date of termination may thereafter be exercised by the Holder for a period
of one year (or such other greater or lesser period as the Committee may specify in the Agreement) from
the date of such termination or until the expiration of the stated term of such Stock Option, whichever period is shorter.

 

(j)
Other Termination. Subject to the provisions of Section 12.3, if such Holder’s employment by, or association with,
the Company or any Subsidiary terminates for any reason other than death, Disability or Normal Retirement, any Stock Option held
by such Holder, unless otherwise determined by the Committee and set forth in the Agreement, shall thereupon automatically terminate,
except that, if the Holder’s employment is terminated by the Company or a Subsidiary without cause, the portion of such
Stock Option that has vested on the date of termination may thereafter be exercised by the Holder for
a period of three months (or such other greater or lesser period as the Committee may specify in the Agreement) from
the date of such termination or until the expiration of the stated term of such Stock Option, whichever period is shorter.

 

(k)
Buyout and Settlement Provisions. The Committee may at any time, in its sole discretion, offer to repurchase a Stock Option
previously granted, at a purchase price not to exceed the Repurchase Value, based upon such terms and conditions as the Committee
shall establish and communicate to the Holder at the time that such offer is made.

 

(l)
Rights as Shareholder. A Holder shall have none of the rights of a Shareholder with respect to the shares subject to the
Option until such shares shall be transferred to the Holder upon the exercise of the Option. 

 

    	 	7	 

    	 	 	 

    

 

Section
6. Stock Appreciation Rights.

 

6.1.
Grant and Exercise. Subject to the terms and conditions of the Plan, the Committee may grant Stock Appreciation Rights
in tandem with an Option or alone and unrelated to an Option. The Committee may grant Stock Appreciation Rights to participants
who have been or are being granted Stock Options under the Plan as a means of allowing such participants
to exercise their Stock Options without the need to pay the exercise price in cash. In the case of a Non-qualified Stock Option,
a Stock Appreciation Right may be granted either at or after the time of the grant of such Non-qualified Stock Option.
In the case of an Incentive Stock Option, a Stock Appreciation Right may be granted only at the time of the grant of such Incentive
Stock Option.

 

6.2.
Terms and Conditions. Stock Appreciation Rights shall be subject to the following terms and conditions:

 

(a)
Exercisability. Stock Appreciation Rights shall be exercisable as shall be determined by the Committee and set forth in
the Agreement, subject, for Stock Appreciation Rights granted in tandem with an Incentive Stock Option, to the limitations, if
any, imposed by the Code with respect to related Incentive Stock Options.

 

(b)
Termination. All or a portion of a Stock Appreciation Right granted in tandem with a Stock Option shall terminate and shall
no longer be exercisable upon the termination or after the exercise of the applicable portion of the related Stock Option.

 

(c)
Method of Exercise. Stock Appreciation Rights shall be exercisable upon such terms and conditions as shall be determined
by the Committee and set forth in the Agreement and, for Stock Appreciation Rights granted in tandem with a Stock Option, by surrendering
the applicable portion of the related Stock Option. Upon exercise of all or a portion of a Stock Appreciation Right and, if applicable,
surrender of the applicable portion of the related Stock Option, the Holder shall be entitled to receive a number of shares of
Common Stock equal to the SAR Value divided by the Fair Market Value on the date the Stock Appreciation Right is exercised.

 

(d)
Shares Available Under Plan. The granting of a Stock Appreciation Right in tandem with a Stock Option shall not affect
the number of shares of Common Stock available for awards under the Plan. The number of shares available for awards under the
Plan will, however, be reduced by the number of shares of Common Stock acquirable upon exercise of the Stock Option to which such
Stock Appreciation Right relates.

 

Section
7. Restricted Stock.

 

7.1.
Grant. Shares of Restricted Stock may be awarded either alone or in addition to other awards granted under the Plan. The
Committee shall determine the eligible persons to whom, and the time or times at which, grants of Restricted Stock will be awarded,
the number of shares to be awarded, the price (if any) to be paid by the Holder, the time or times within
which such awards may be subject to forfeiture (“Restriction Period”), the vesting schedule and rights to acceleration
thereof and all other terms and conditions of the awards.

 

    	 	8	 

    	 	 	 

    

 

7.2.
Terms and Conditions. Each Restricted Stock award shall be subject to the following terms and conditions:

 

(a)
Certificates. Restricted Stock, when issued, will be represented by a stock certificate or certificates registered in the
name of the Holder to whom such Restricted Stock shall have been awarded. During the Restriction Period, certificates representing
the Restricted Stock and any securities constituting Retained Distributions (as defined below) shall bear a legend to the effect
that ownership of the Restricted Stock (and such Retained Distributions) and the enjoyment of all rights
appurtenant thereto are subject to the restrictions, terms and conditions provided in the Plan and the Agreement. Such certificates
shall be deposited by the Holder with the Company, together with stock powers or other instruments of assignment, each endorsed
in blank, which will permit transfer to the Company of all or any portion of the Restricted Stock and any securities constituting
Retained Distributions that shall be forfeited or that shall not become vested in accordance with the Plan and the Agreement.

 

(b)
Rights of Holder. Restricted Stock shall constitute issued and outstanding shares of Common Stock for all corporate purposes.
The Holder will have the right to vote such Restricted Stock and to exercise all other rights, powers and privileges of a holder
of Common Stock with respect to such Restricted Stock, with the exceptions that (i) the Holder will
not be entitled to delivery of the stock certificate or certificates representing such Restricted Stock until the Restriction
Period shall have expired and unless all other vesting requirements with respect thereto shall have been fulfilled; (ii) the Company
will retain custody of the stock certificate or certificates representing the Restricted Stock during the Restriction Period;
(iii) the Company will retain custody of all dividends and distributions (“Retained Distributions”) made, paid or
declared with respect to the Restricted Stock (and such Retained Distributions will be subject to the same restrictions, terms
and conditions as are applicable to the Restricted Stock) until such time, if ever, as the Restricted Stock with respect to which
such Retained Distributions shall have been made, paid or declared shall have become vested and with respect to which the Restriction
Period shall have expired; and (iv) a breach of any of the restrictions, terms or conditions contained in this Plan or the Agreement
or otherwise established by the Committee with respect to any Restricted Stock or Retained Distributions will cause a forfeiture
of such Restricted Stock and any Retained Distributions with respect thereto.

 

(c)
Vesting; Forfeiture. Upon the expiration of the Restriction Period with respect to each award of Restricted Stock and the
satisfaction of any other applicable restrictions, terms and conditions (i) all or part of such Restricted Stock shall become
vested in accordance with the terms of the Agreement, and (ii) any Retained Distributions with respect to such Restricted Stock
shall become vested to the extent that the Restricted Stock related thereto shall have become vested.
Any such Restricted Stock and Retained Distributions that do not vest shall be forfeited to the Company and the Holder shall not
thereafter have any rights with respect to such Restricted Stock and Retained Distributions that shall have been so forfeited.

 

Section
8. Other Stock-Based Awards.

 

Other
Stock-Based Awards may be awarded, subject to limitations under applicable law, that are denominated
or payable in, valued in whole or in part by reference to, or otherwise based on or related to, shares of Common Stock, as deemed
by the Committee to be consistent with the purposes of the Plan, including, without limitation, purchase rights, shares of Common
Stock awarded which are not subject to any restrictions or conditions, convertible or exchangeable debentures, or other rights
convertible into shares of Common Stock and awards valued by reference to the value of securities of or the performance of specified
Subsidiaries. These other stock-based awards may include performance shares or options, whose award is tied to specific
performance criteria. Other Stock-Based Awards may be awarded either alone or in addition to or in
tandem with any other awards under this Plan or any other plan of the Company. Each other Stock-Based Award shall be subject to
such terms and conditions as may be determined by the Committee.

 

    	 	9	 

    	 	 	 

    

 

Section
9. Accelerated Vesting and Exercisability.

 

9.1.
Non-Approved Transactions. If any one person, or more than one person acting as a group, acquires the ownership of stock
of the Company that, together with the stock held by such person or group, constitutes more than 50% of the total fair market
value or combined voting power of the stock of the Company, and the Board does not authorize or otherwise
approve such acquisition, then the vesting periods of any and all Stock Options and other awards granted and outstanding under
the Plan shall be accelerated and all such Stock Options and awards will immediately and entirely vest, and the respective holders
thereof will have the immediate right to purchase and/or receive any and all Common Stock subject to such Stock Options and awards
on the terms set forth in this Plan and the respective Agreements respecting such Stock Options and awards. An increase
in the percentage of stock owned by any one person, or persons acting as a group, as a result of a transaction in which the Company
acquires its stock in exchange for property is not treated as an acquisition of stock for purposes of this Section 9.1.

 

9.2.
Approved Transactions. The Committee may, in the event of an acquisition by any one person, or more than one person acting
as a group, together with acquisitions during the 12-month period ending on the date of the most recent acquisition by such person
or persons, of assets from the Company that have a total gross fair market value equal to or more than 50% of the total gross
fair market value of all of the assets of the Company immediately before such acquisition or acquisitions, or if any one person,
or more than one person acting as a group, acquires the ownership of stock of the Company that, together with the stock held by
such person or group, constitutes more than 50% of the total fair market value or combined voting power of the stock of the Company,
which has been approved by the Company’s Board of Directors, (i) accelerate the vesting of any
and all Stock Options and other awards granted and outstanding under the Plan, or (ii) require a Holder of any award granted under
this Plan to relinquish such award to the Company upon the tender by the Company to Holder of cash in an amount equal to the Repurchase
Value of such award. For this purpose, gross fair market value means the value of the assets of the Company, or the value
of the assets being disposed of, determined without regard to any liabilities associated with such assets.

 

9.3.
Code Section 409A. Notwithstanding any provisions of this Plan or any award granted hereunder to the contrary, no acceleration
shall occur with respect to any award to the extent such acceleration would cause the Plan or an award
granted hereunder to fail to comply with Code Section 409A.

 

Section
10. Amendment and Termination.

 

The
Board may at any time, and from time to time, amend alter, suspend or discontinue any of the provisions of the Plan, but no amendment,
alteration, suspension or discontinuance shall be made that would impair the rights of a Holder under
any Agreement theretofore entered into hereunder, without the Holder’s consent, except as set forth in this Plan.

 

    	 	10	 

    	 	 	 

    

 

Section
11. Term of Plan.

 

11.1.
Effective Date. The Effective Date of the Plan shall be the date on which the Plan is adopted by the Board. Awards may
be granted under the Plan at any time after the Effective Date and before the date fixed herein for termination of the Plan; provided,
however, that if the Plan is not approved by the affirmative vote of the holders of a majority of the Common Stock cast at a duly
held stockholders’ meeting at which a quorum is, either in person or by proxy, present and voting within one year from the
Effective Date, then (i) no Incentive Stock Options may be granted hereunder and (ii) all Incentive Stock Options previously granted
hereunder shall be automatically converted into Non-qualified Stock Options.

 

11.2.
Termination Date. Unless terminated by the Board, this Plan shall continue to remain effective until such time as no further
awards may be granted and all awards granted under the Plan are no longer outstanding. Notwithstanding
the foregoing, grants of Incentive Stock Options may be made only during the ten-year period beginning on the Effective Date.

 

Section
12. General Provisions.

 

12.1.
Written Agreements. Each award granted under the Plan shall be confirmed by, and shall be subject
to the terms of, the Agreement executed by the Company and the Holder, or such other document as may be determined by the Committee.
The Committee may terminate any award made under the Plan if the Agreement relating thereto is not executed and returned to the
Company within 10 days after the Agreement has been delivered to the Holder for his or her execution.

 

12.2.
Unfunded Status of Plan. The Plan is intended to constitute an “unfunded” plan for
incentive and deferred compensation. With respect to any payments not yet made to a Holder by the Company, nothing contained herein
shall give any such Holder any rights that are greater than those of a general creditor of the Company.

 

12.3.
Employees.

 

(a)
Engaging in Competition With the Company; Solicitation of Customers and Employees; Disclosure of Confidential Information.
If a Holder’s employment with the Company or a Subsidiary is terminated for any reason whatsoever, and within 12 months
after the date thereof such Holder either (i) accepts employment with any competitor of, or otherwise
engages in competition with, the Company or any of its Subsidiaries, (ii) solicits any customers or employees of the Company or
any of its Subsidiaries to do business with or render services to the Holder or any business with which the Holder becomes affiliated
or to which the Holder renders services or (iii) uses or discloses to anyone outside the Company any confidential information
or material of the Company or any of its Subsidiaries in violation of the Company’s policies or any agreement between the
Holder and the Company or any of its Subsidiaries, the Committee, in its sole discretion, may require such Holder to return to
the Company the economic value of any award that was realized or obtained by such Holder at any time during the period beginning
on the date that is six months prior to the date such Holder’s employment with the Company is terminated; provided, however,
that if the Holder is a resident of the State of California, such right must be exercised by the Company for cash within six months
after the date of termination of the Holder’s service to the Company or within six months after exercise of the applicable
Stock Option, whichever is later. In such event, Holder agrees to remit to the Company, in cash, an amount equal to the difference
between the Fair Market Value of the Shares on the date of termination (or the sales price of such Shares if the Shares were sold
during such six month period) and the price the Holder paid the Company for such Shares.

 

    	 	11	 

    	 	 	 

    

 

(b)
Termination for Cause. If a Holder’s employment with the Company or a Subsidiary is terminated for cause, the Committee
may, in its sole discretion, require such Holder to return to the Company the economic value of any
award that was realized or obtained by such Holder at any time during the period beginning on that date that is six months prior
to the date such Holder’s employment with the Company is terminated. In such event, Holder agrees to remit to the Company,
in cash, an amount equal to the difference between the Fair Market Value of the Shares on the date of termination (or the sales
price of such Shares if the Shares were sold during such six month period) and the price the Holder paid the Company for such
Shares.

 

(c)
No Right of Employment. Nothing contained in the Plan or in any award hereunder shall be deemed to confer upon any Holder
who is an employee of the Company or any Subsidiary any right to continued employment with the Company
or any Subsidiary, nor shall it interfere in any way with the right of the Company or any Subsidiary to terminate the employment
of any Holder who is an employee at any time.

 

12.4.
Investment Representations; Company Policy. The Committee may require each person acquiring shares of Common Stock pursuant
to a Stock Option or other award under the Plan to represent to and agree with the Company in writing that the Holder is acquiring
the shares for investment without a view to distribution thereof. Each person acquiring shares of Common
Stock pursuant to a Stock Option or other award under the Plan shall be required to abide by all policies of the Company in effect
at the time of such acquisition and thereafter with respect to the ownership and trading of the Company’s securities.

 

12.5.
Additional Incentive Arrangements. Nothing contained in the Plan shall prevent the Board from adopting such other or additional
incentive arrangements as it may deem desirable, including, but not limited to, the granting of Stock
Options and the awarding of Common Stock and cash otherwise than under the Plan; and such arrangements may be either generally
applicable or applicable only in specific cases.

 

12.6.
Withholding Taxes. Not later than the date as of which an amount must first be included in the gross income of the Holder
for Federal income tax purposes with respect to any Stock Option or other award under the Plan, the Holder shall pay to the Company,
or make arrangements satisfactory to the Committee regarding the payment of, any Federal, state and
local taxes of any kind required by law to be withheld or paid with respect to such amount. If permitted by the Committee, tax
withholding or payment obligations may be settled with Common Stock, including Common Stock that is part of the award that gives
rise to the withholding requirement. The obligations of the Company under the Plan shall be conditioned upon such payment or arrangements
and the Company or the Holder’s employer (if not the Company) shall, to the extent permitted by law, have the right to deduct
any such taxes from any payment of any kind otherwise due to the Holder from the Company or any Subsidiary.

 

12.7.
Governing Law. The Plan and all awards made and actions taken thereunder shall be governed by
and construed in accordance with the law of the State of Delaware (without regard to choice of law provisions).

 

    	 	12	 

    	 	 	 

    

 

12.8.
Other Benefit Plans. Any award granted under the Plan shall not be deemed compensation for purposes
of computing benefits under any retirement plan of the Company or any Subsidiary and shall not affect any benefits under any other
benefit plan now or subsequently in effect under which the availability or amount of benefits is related to the level of compensation
(unless required by specific reference in any such other plan to awards under this Plan).

 

12.9.
Non-Transferability. Except as otherwise expressly provided in the Plan or the Agreement, no right or benefit under the
Plan may be alienated, sold, assigned, hypothecated, pledged, exchanged, transferred, encumbranced
or charged, and any attempt to alienate, sell, assign, hypothecate, pledge, exchange, transfer, encumber or charge the same shall
be void.

 

12.10.
Applicable Laws. The obligations of the Company with respect to all Stock Options and awards
under the Plan shall be subject to (i) all applicable laws, rules and regulations and such approvals by any governmental agencies
as may be required, including, without limitation, the Securities Act, and (ii) the rules and regulations of any securities exchange
on which the Common Stock may be listed.

 

12.11.
Conflicts. If any of the terms or provisions of the Plan or an Agreement conflict with the requirements
of Section 422 of the Code, then such terms or provisions shall be deemed inoperative to the extent they so conflict with such
requirements. Additionally, if this Plan or any Agreement does not contain any provision required to be included herein under
Section 422 of the Code, such provision shall be deemed to be incorporated herein and therein with the same force and effect as
if such provision had been set out at length herein and therein. If any of the terms or provisions of any Agreement conflict with
any terms or provisions of the Plan, then such terms or provisions shall be deemed inoperative to the extent they so conflict
with the requirements of the Plan. Additionally, if any Agreement does not contain any provision required to be included therein
under the Plan, such provision shall be deemed to be incorporated therein with the same force and effect as if such provision
had been set out at length therein.

 

12.12.
Certain Awards Deferring or Accelerating the Receipt of Compensation. To the extent applicable, all awards granted, and
all Agreements entered into, under the Plan are intended to comply with Section 409A of the Code, which was added by the American
Jobs Creation Act of 2004 and relates to deferred compensation under nonqualified deferred compensation
plans. The Committee, in administering the Plan, intends, and the parties entering into any Agreement intend, to restrict provisions
of any awards that may constitute deferred receipt of compensation subject to Code Section 409A requirements to those consistent
with this Section. The Board may amend the Plan to comply with Code Section 409A in the future.

 

12.13.
Non-Registered Stock. The shares of Common Stock to be distributed under this Plan have not been, as of the Effective Date,
registered under the Securities Act or any applicable state or foreign securities laws and the Company has no obligation to any
Holder to register the Common Stock or to assist the Holder in obtaining an exemption from the various registration requirements,
or to list the Common Stock on a national securities exchange or any other trading or quotation system, including Nasdaq.

 

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