Document:

lqda_Ex10_1

		
			Exhibit 10.1
		

		
			 
		

		
			THIRTEENTH AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS THIRTEENTH AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan, as amended (the “Plan”), was duly adopted by the Board of Directors (the “Board”) of Liquidia Technologies, Inc. (the “Company”) on September 20, 2018.
		

		
			 
		

		
			WHEREAS, the Board has adopted and the stockholders of the Company have previously approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board deems it to be in the best interest of the Company to amend the Plan to provide for net exercise as an additional method to exercise nonqualified stock options without an additional approval by the Board required at the time of exercise.
		

		
			 
		

		
			NOW, THEREFORE, effective as of September 20, 2018, the Plan is hereby amended as follows:
		

		
			 
		

		
			1.            Section 6(c) of the Plan is hereby deleted in its entirety and replaced with the following:
		

		
			 
		

		
			“Payment of Exercise Price. Payment of the exercise price for the number of shares of Stock being purchased pursuant to any Option shall be made (i) in cash, (ii) by check, (iii) by cash equivalent, (iv) for nonqualified stock options only, by a “net exercise” arrangement pursuant to which the Company will reduce the number of shares of Stock issuable upon exercise by the largest whole number of shares with a fair market value that does not exceed the aggregate exercise price or (v) in any other manner as may be permitted by the Board in its discretion.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provision of the Plan shall remain in full force and effect.
		

		
			 
		

		
			[Signature Page Immediately Follows]
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			IN WITNESS WHEREOF, the undersigned has caused this Amendment to be executed as of the date first set forth above.
		

		
			 
		

			
					
						 

					
					
						LIQUIDIA TECHNOLOGIES, INC.

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						By: 

					
					
						/s/ Kevin Gordon

				
	
					
						 

					
					
						Name:

					
					
						Kevin Gordon

				
	
					
						 

					
					
						Title:

					
					
						President and Chief Financial Officer

				

		
			 
		

		
			[SIGNATURE PAGE TO STOCK OPTION PLAN AMENDMENT NO. 13]
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			LIQUIDIA TECHNOLOGIES, INC.
		

		
			 
		

		
			TWELFTH AMENDMENT TO STOCK OPTION PLAN
		

		
			 
		

		
			A.           LIQUIDIA TECHNOLOGIES, INC., a corporation organized under the laws of the State of Delaware (the “Company”) established the Company’s Stock Option Plan (the “Plan”) by an original instrument adopted by the Company on November 6, 2004;
		

		
			 
		

		
			B.           The Plan currently provides for 11,899,642 shares of Common Stock to be reserved for issuance under the Plan; and
		

		
			 
		

		
			C.           The Company now wishes to amend the Plan to increase the number of shares of Common Stock reserved for issuance under the Plan by 5,000,000 shares to an aggregate of 16,899,642 shares and to modify Paragraph 4 of the Plan.
		

		
			 
		

		
			NOW THEREFORE, effective immediately, the Plan is amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be Sixteen Million Eight Hundred Ninety-Nine Thousand Six Hundred Forty-Two (16,899,642) shares.”
		

		
			 
		

		
			2.            In all other respects the Plan will remain the same.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			ELEVENTH AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS ELEVENTH AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) was duly adopted by the Board of Directors and the stockholders of Liquidia Technologies, Inc. (the “Company”) effective November 6, 2014 and October 9, 2015, respectively.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to extend the period of time during which options may be granted pursuant to the Plan.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            Section 5 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Time for Granting Options: All Options shall be granted, if at all, within twelve (12) years from the earlier of the date the Plan is adopted by the Board or the date the plan is duly approved by the stockholders of the Company.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provisions of the Plan, as previously amended, shall remain in full force and effect as adopted and approved.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			TENTH AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS TENTH AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) was duly adopted by the Board of Directors and the stockholders of Liquidia Technologies, Inc. (the “Company”) effective August 28, 2013 and January 22, 2014, respectively.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to increase the maximum number of shares of common stock issuable pursuant to options granted under the Plan from 10,287,339 shares to 11,899,642 shares.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be 11,899,642 shares.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provisions of the Plan shall remain in full force and effect as originally adopted and approved.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			NINTH AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS NINTH AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) was duly adopted by the Board of Directors and the stockholders of Liquidia Technologies, Inc. (the “Company”) effective February 16, 2011 and February 17, 2011, respectively.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to increase the maximum number of shares of common stock issuable pursuant to options granted under the Plan from 9,033,327 shares to 10,287,339 shares.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be 10,287,339 shares.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provisions of the Plan shall remain in full force and effect as originally adopted and approved.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			EIGHTH AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS EIGHTH AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) was duly adopted by the Board of Directors and the stockholders of Liquidia Technologies, Inc. (the “Company”) effective April 14, 2010.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to increase the maximum number of shares of common stock issuable pursuant to options granted under the Plan from 6,934,407 shares to 9,033,327 shares.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be 9,033,327 shares.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provisions of the Plan shall remain in full force and effect as originally adopted and approved.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			SEVENTH AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS SEVENTH AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) was duly adopted by the Board of Directors and the stockholders of Liquidia Technologies, Inc. (the “Company”) effective January 8, 2010.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to increase the maximum number of shares of common stock issuable pursuant to options granted under the Plan from 4,659,972 shares to 6,934,407 shares.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be 6,934,407 shares.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provisions of the Plan shall remain in full force and effect as originally adopted and approved.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			SIXTH AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS SIXTH AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) was duly adopted by the Board of Directors and the stockholders of Liquidia Technologies, Inc. (the “Company”) on June 30, 2009.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to increase the maximum number of shares of common stock issuable pursuant to options granted under the Plan from 3,203,881 to 4,659,972.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be 4,659,972 shares.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provisions of the Plan shall remain in full force and effect as originally adopted and approved.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			FIFTH AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS FIFTH AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) was duly adopted by the Board of Directors of Liquidia Technologies, Inc. (the “Company”) on May 13, 2008.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to increase the maximum number of shares of common stock issuable pursuant to options granted under the Plan from 3,203,881 to 3,403,881.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be 3,403,881 shares.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provisions of the Plan shall remain in full force and effect as originally adopted and approved.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			FOURTH AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS FOURTH AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) was duly adopted by the Board of Directors of Liquidia Technologies, Inc. (the “Company”) on February 27, 2007.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to increase the maximum number of shares of common stock issuable pursuant to options granted under the Plan from 2,502,210 to 3,203,881.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be 3,203,881 shares.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provisions of the Plan shall remain in full force and effect as originally adopted and approved.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			THIRD AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS THIRD AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) was duly adopted by the Board of Directors of Liquidia Technologies, Inc. (the “Company”) on October 23, 2006.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to increase the maximum number of shares of common stock issuable pursuant to options granted under the Plan from 1,502,210 to 2,502,210.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be 2,502,210 shares.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provisions of the Plan shall remain in full force and effect as originally adopted and approved.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			SECOND AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS SECOND AMENDMENT of Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) was duly adopted by written consent of the Board of Directors of Liquidia Technologies, Inc. (the “Company”) on May 12, 2006.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to decrease the maximum number of shares of common stock issuable pursuant to options granted under the Plan from 1,631,935 to 1,502,210.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be 1,502,210 shares.”
		

		
			 
		

		
			2.            Except as herein amended, the terms and provisions of the Plan shall remain in full force and effect as originally adopted and approved.
		

		
			 
		

		
			
		

		
			

		 

 

		

		
			FIRST AMENDMENT
		

		
			OF LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			THIS FIRST AMENDMENT of Liquidia Technologies, Inc. Slock Option Plan (the “Plan”) was duly adopted by written consent of the Board of Directors of Liqudia Technologies, Inc. (the “Company”) on November 10, 2004.
		

		
			 
		

		
			WHEREAS, the Board of Directors of the Company has adopted and the stockholders of the Company have approved the Plan; and
		

		
			 
		

		
			WHEREAS, the Board of Directors deems it to be in the best interest of the Company to amend the Plan in order to increase the maximum number of shares of common stock issuable pursuant to options granted under the Plan from 1,800,000 to 1,631,935.
		

		
			 
		

		
			NOW, THEREFORE, the Plan shall be amended as follows:
		

		
			 
		

		
			1.            The first sentence of Paragraph 4 of the Plan shall be deleted in its entirety and the following substituted in lieu thereof:
		

		
			 
		

		
			“Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be One Million Six Hundred Thirty-One Thousand Nine Hundred Thirty-Five (1,631,935) shares.”
		

		
			 
		

		
			2.            Except as herein amended, [he terms and provisions of the Plan shall remain in full force and effect as originally adopted and approved,
		

		
			 
		

		
			 
		

		
			

		 

 

		

		
			LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN
		

		
			 
		

		
			1.            Purpose. The Liquidia Technologies, Inc. Stock Option Plan (the “Plan”) is established to create an additional incentive for key employees, directors and consultants or advisors of Liquidia Technologies, Inc. and any successor corporations or any present or future parent and/or subsidiary corporations of such corporation (collectively, the “Company”) to promote the financial success and progress of the Company. For purposes of the Plan, a parent corporation and a subsidiary corporation shall be as defined in Sections 424(e) and 424(f) of the Internal Revenue Code of 1986, as amended (the “Code”).
		

		
			 
		

		
			2.            Administration. The Plan shall be administered by the Board of Directors of the Company (the “Board”) and/or by a duly appointed committee of the Board having such powers as shall be specified by the Board. Any subsequent references herein to the Board shall also mean the committee if such committee has been appointed and, unless the powers of the committee have been specifically limited, the committee shall have all of the powers of the Board granted herein, other than power to terminate or amend the Plan as provided in Paragraph 11 hereof, subject to the terms of the Plan and any applicable limitations imposed by law. All questions of interpretation of the Plan or of any award granted under the Plan shall be determined by the Board, and such determinations shall be final and binding upon all persons having an interest in the Plan and/or any Option (as defined below). Any officer of the Company shall have the authority to act on behalf of the Company with respect to any matter, right, obligation or election which is the responsibility of or which is allocated to the Company herein, provided the officer has apparent authority with respect to such matter, right, obligation or election.
		

		
			 
		

		
			3.            Eligibility. The Board may grant options (each an “Option”) to purchase shares of the authorized but unissued Class A Voting Common Stock of the Company (the “Stock”), which Options may be either incentive stock options as defined in Section 422 of the Code (an “Incentive Stock Option”) or nonqualified stock options. Options may be granted to employees, officers, directors, consultants, advisors or other independent contractors (collectively “persons”). The Board, in its sole discretion, shall determine to whom Options are granted (each an “Optionee”). An Option that the Board intends to be an Incentive Stock Option shall only be granted to an employee of the Company and shall be subject to and shall be construed consistently with the requirements of Section 422 of the Code. The Company shall have no liability to an Optionee, if an Option (or any part thereof) which is intended to be an Incentive Stock Option does not qualify as an Incentive Stock Option. An Optionee may, if otherwise eligible, be granted additional Options.
		

		
			 
		

		
			4.            Shares Subject to Option. Subject to adjustment as provided in Paragraph 9 below, the maximum number of shares of Stock which may be issued pursuant to Options granted under the Plan shall be One Million Eight Hundred Thousand (1,800,000) shares. If any outstanding Option for any reason expires or is terminated or cancelled, the shares of Stock allocable to the unexercised portion of such Option, may again be subject to an Option. It is intended that the Plan shall constitute a written compensatory benefit plan
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

		
			within the meaning of Rule 701 promulgated under the Securities Act of 1933, as amended (“Rule 701”), to the extent applicable, and that the Plan shall otherwise be administered in compliance with the requirements of Rule 701. To ensure such compliance, the Company shall maintain a record of shares subject to outstanding Options under the Plan and the exercise price of the Options, plus a record of all shares of Stock issued upon the exercise of the Options and the exercise price of the Options.
		

		
			 
		

		
			5.            Time for Granting Options. All Options shall be granted, if at all, within ten (10) years from the earlier of the date the Plan is adopted by the Board or the date the Plan is duly approved by the stockholders of the Company.
		

		
			 
		

		
			6.            Terms, Conditions and Form of Options. Subject to the provisions of the Plan, the Board shall determine for each Option the number of shares of Stock into which the Option is exercisable, whether the Option is to be treated as an Incentive Stock Option or as a nonqualified stock option and all other terms and conditions of the Option. Each Option granted pursuant to the Plan shall comply with and be subject to the following terms and conditions:
		

		
			 
		

		
			(a)          Exercise Price. The exercise price for each Option shall be established in the sole discretion of the Board; provided, however, that (i) the exercise price per share for an Incentive Stock Option shall be not less than the fair market value of a share of Stock on the date of grant and (ii) the exercise price per share of an Incentive Stock Option granted to an Optionee who on the date of the grant owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company within the meaning of Section 422(b)(6) of the Code (a “Ten Percent Owner Optionee”) shall be not less than one hundred ten percent (110%) of the fair market value of a share of Stock on the date of grant. For this purpose, “fair market value” means the value assigned to the Stock by the Board for any date of grant, as determined pursuant to a reasonable method established by the Board that is consistent with the requirements of Sections 422 and 424 of the Code and the regulations thereunder (which method may be changed from time to time). Notwithstanding the foregoing, an Option (whether an Incentive Stock Option or a nonqualified stock option) may be granted by the Board in its discretion with an exercise price lower than the minimum exercise price set forth above if, in the case of an Incentive Stock Option, such Option is granted pursuant to an assumption or substitution for another option in accordance with the provisions of Section 424(a) of the Code. The foregoing shall not require that any such assumption or modification will result in the Option having the same characteristics, attributes or tax treatment as the Option for which it is substituted.
		

		
			 
		

		
			(b)          Exercise Period of Options. The Board shall have the power to set the times on or within which an Option shall be exercisable or the events upon which an Option shall be exercisable and the term of an Option; provided, however, that (i) no Incentive Stock Option shall be exercisable after the expiration of ten (10) years after the date of grant, (ii) no Incentive Stock Option granted to a Ten Percent
		

		
			 
		

		
			 
		

		
			

		 

		

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			Owner Optionee shall be exercisable after the expiration of five (5) years after the dale of grant, (iii) no Option shall be exercisable after the date the Optionee’s employment with the Company is terminated for cause (as determined in the sole discretion of the Board unless cause is defined in an employment agreement between the Optionee and the Company in which case such definition shall be used); and (iv) each Incentive Stock Option shall terminate and cease to be exercisable no later than three (3) months after the date on which the Optionee terminates employment with the Company, unless the Optionee’s employment with the Company was terminated as a result of the Optionee’s death or disability (within the meaning of Section 22(e)(3) of the Code), in which event the Incentive Stock Option shall terminate and cease to be exercisable no later than twelve (12) months from the date on which the Optionee’s employment terminated. For this purpose, an Optionee’s employment shall be deemed to have terminated as a result of death if the Optionee dies within three (3) months following the Optionee’s termination of employment.
		

		
			 
		

		
			(c)          Payment of Exercise Price. Payment of the exercise price for the number of shares of Stock being purchased pursuant to any Option shall be made in cash, by check, cash equivalent or in any other manner as may be permitted by the Board in its discretion.
		

		
			 
		

		
			(d)          $100,000 Limitation. The aggregate fair market value, determined as of the date of grant of the shares of the Stock with respect to which an Incentive Stock Option (determined without regard to this subparagraph) is first exercisable during any calendar year (under this Plan or under any other plan of the Company) by any Optionee shall not exceed $100,000. If such limitation would be exceeded with respect to an Optionee for a calendar year, the Incentive Stock Option shall be deemed a nonqualified slock option to the extent of such excess.
		

		
			 
		

		
			7.            Forms of Stock Option Agreements. All Options shall be evidenced by a written agreement substantially in the form of the incentive stock option agreement attached hereto as Exhibit A or the nonqualified stock option agreement attached hereto as Exhibit B, as applicable, both of which are incorporated herein by reference (the “Form Option Agreements”) or such other form or forms as may be approved by the Board consistent with the terms of this Plan. The Board shall have the authority from time to time to vary the terms of the Form Option Agreements either in connection with the grant of an Option or in connection with the authorization of a new standard form or forms; provided, however, that the terms and conditions of such revised or amended standard form or forms of stock option agreement shall be in accordance with the terms of the Plan.
		

		
			 
		

		
			8.            Transfer of Control Upon a merger, consolidation, corporate reorganization, or any transaction in which all or substantially all of the assets or stock of the Company are sold, leased, transferred or otherwise disposed of (other than a mere reincorporation transaction or one in which the holders of voting capital stock of the Company immediately prior to such merger or consolidations continue to hold at least a majority of the voting power of
		

		
			 
		

		
			
		

		
			

		 

		

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			the surviving corporation) (a “Transfer of Control”), then, except as otherwise provided in a particular stock option agreement approved by the Board, any unexercisable portion of an outstanding Option that would otherwise become exercisable within twelve (12) months following the effective time of the Transfer of Control shall become immediately exercisable as of a date prior to the Transfer of Control, which date shall be determined by the Board. Upon the occurrence of a Transfer of Control, each outstanding Option, to the extent not exercised prior to the Transfer of Control, shall terminate as of the effective time of the Transfer of Control, unless such Option is assumed by the successor corporation (or parent thereof) or replaced with a comparable option to purchase shares of the capital stock of the successor corporation (or parent thereof). The exercise of any Option that was permissible solely by reason of this Paragraph 8 shall be conditioned upon the consummation of the Transfer of Control.
		

		
			 
		

		
			9.            Effect of Change in Stock Subject to Plan. The Board shall make appropriate adjustments in the number and class of shares of the Stock subject to the Plan and to any outstanding Options and in the option price of any outstanding Options in the event of a stock dividend, stock split, reverse stock split, combination, reclassification or similar change in the capital structure of the Company.
		

		
			 
		

		
			10.          Options Non-Transferable. Except as otherwise provided in a stock option agreement, no Option shall be assignable or transferable by the Optionee, except by will or by the laws of descent and distribution. During the lifetime of an Optionee, an Option shall be exercisable only by such Optionee.
		

		
			 
		

		
			11.          Termination or Amendment. The Board may amend, suspend or terminate the Plan or any portion thereof at any time. The Board may amend, modify or terminate any outstanding Option; provided, however, that no amendment authorized hereby may adversely affect the rights of any Optionee under any then outstanding Option without the consent of the Optionee, unless such amendment is required to enable an Option designated as an Incentive Stock Option to qualify as an Incentive Stock Option. The Board shall be entitled to create, amend or delete appendices to this Plan as specified herein.
		

		
			 
		

		
			12.          Withholding. Each Optionee shall pay to the Company, or make provision satisfactory to the Board for payment of, any taxes required by law to be withheld in connection with Options to such Optionee no later than the date of the event creating the tax liability. Except as the Board may otherwise provide in an award, when the Stock is registered under the Securities Exchange Act of 1934, as amended, Optionees may satisfy such tax obligations in whole or in part by delivery of shares of Stock, including shares retained from the Option creating the tax obligation, valued at their fair market value as determined by, or in a manner approved by, the Board in good faith; provided, however, that the total tax withholding where stock is being used to satisfy such tax obligations cannot exceed the Company’s minimum statutory withholding obligations (based on minimum statutory withholding rates for federal and state tax purposes, including payroll taxes, that are applicable to such supplemental taxable income). The Company may, to
		

		
			 
		

		
			
		

		
			

		 

		

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			the extent permitted by law, deduct any such tax obligations from any payment of any kind otherwise due to an Optionee.
		

		
			 
		

		
			13.          Conditions on Delivery of Stock. The Company will not be obligated to deliver any shares of Common Stock pursuant to the Plan or to remove restrictions from shares previously delivered under the Plan until (i) all conditions of the Option have been met or removed to the satisfaction of the Company, (ii) in the opinion of the Company’s counsel, all other legal matters in connection with the issuance and delivery of such shares have been satisfied, including any applicable securities laws and any applicable stock exchange or stock market rules and regulations, and (iii) the Optionee has executed and delivered to the Company such representations or agreements as the Company may consider appropriate to satisfy the requirements of any applicable laws, rules or regulations.
		

		
			 
		

		
			14.          Right of First Refusal.
		

		
			 
		

		
			(a)          Right of First Refusal. If any Optionee proposes to sell, pledge or otherwise transfer any shares of Stock acquired upon exercise of an Option (the “Exercise Shares”), the Company shall have the right to repurchase the Exercise Shares under the terms and subject to the conditions set forth in this Paragraph 14 (the “Right of First Refusal”).
		

		
			 
		

		
			(b)          Notice of Proposed Transfer. Prior to any proposed transfer of the Exercise Shares, the Optionee shall give a written notice (the “Transfer Notice”) to the Company describing fully the proposed transfer, including the number of Exercise Shares, the name and address of the proposed transferee (the “Proposed Transferee”), the proposed transfer price and all other material terms and conditions of the proposed transfer.
		

		
			 
		

		
			(c)          Exercise of the Right of First Refusal. The Company shall have the right to purchase all, but not less than all, of the Exercise Shares at the purchase price and on the terms set forth in the Transfer Notice by delivery to the Optionee of a notice of exercise of the Right of First Refusal within thirty (30) days after the date the Transfer Notice is delivered to the Company. The Company’s exercise or failure to exercise the Right of First Refusal with respect to any proposed transfer described in a Transfer Notice shall not affect the Company’s ability to exercise the Right of First Refusal with respect to any proposed transfer described in any other Transfer Notice, whether or not such other Transfer Notice is issued by the Optionee or issued by any other person with respect to a proposed transfer to the same Proposed Transferee. If the Company exercises the Right of First Refusal, the Company and the Optionee shall thereupon consummate the sale of the Exercise Shares to the Company on the terms set forth in the Transfer Notice; provided however, that if the Transfer Notice provides for the payment for the Exercise Shares other than in cash, the Company shall have the option of paying for the Exercise Shares by the discounted cash equivalent of the consideration described in the Transfer Notice as reasonably determined by the Company. For purposes of the foregoing, cancellation of any indebtedness of the Optionee to the
		

		
			 
		

		
			
		

		
			

		 

		

			5

		

 

		

		
			Company shall be treated as payment to the Optionee in cash to the extent of the unpaid principal and any accrued interest cancelled.
		

		
			 
		

		
			(d)          Failure to Exercise the Right of First Refusal. If the Company fails to exercise the Right of First Refusal within the period specified in Paragraph 14(c) above, the Optionee may conclude a transfer to the Proposed Transferee of the Exercise Shares on the terms and conditions described in the Transfer Notice, provided such transfer occurs not later than one hundred twenty (120) days following delivery to the Company of the Transfer Notice. Any proposed transfer on terms and conditions different from those described in the Transfer Notice, as well as any subsequent proposed transfer by the Optionee, also shall be subject to the Right of First Refusal and shall require compliance by the Optionee with the procedure described in this Paragraph 14.
		

		
			 
		

		
			(e)          Transferees of the Transfer Shares. All transferees of the Exercise Shares or any interest therein, other than the Company, shall be required as a condition of such transfer to agree in writing (in a form satisfactory to the Company) that such transferee shall receive and hold such Exercise Shares or interests subject to the provisions of this Paragraph 14 providing for the Right of First Refusal with respect to any subsequent transfer.
		

		
			 
		

		
			(f)           Transfers Not Subject to the Right of First Refusal. The Right of First Refusal shall not apply to any transfer or exchange of the Exercise Shares if: (i) such transfer is in connection with a Transfer of Control; (ii) such transfer is to one or more members of the Optionee’s immediate family (or a trust for their benefit) provided all such transferees agree in writing to the restrictions of Paragraph 14(e); or (iii) such transfer has been approved by the Board, which approval may be granted or withheld in its complete discretion.
		

		
			 
		

		
			(g)          Assignment of the Right of First Refusal. The Company shall have the right to assign the Right of First Refusal at any time.
		

		
			 
		

		
			(h)          Stock Dividends Subject to First Refusal Right. If, from time to time, there is any stock dividend, stock split, recapitalization, reclassification or other change in the character or amount of any of the outstanding stock of the Company, the stock of which is subject to the provisions of an option agreement issued pursuant to the Plan, then, in such event, any and all new substituted or additional securities to which the Optionee is entitled by reason of the Optionee’s ownership of the shares acquired upon exercise of an Option shall be immediately subject to the Right of First Refusal with the same force and effect as the shares subject to the Right of First Refusal immediately before such event.
		

		
			 
		

		
			(i)           Early Termination of the Right of First Refusal. The other provisions of this Paragraph 14 notwithstanding, the Right of First Refusal shall terminate, and be of no further force and effect, upon the earlier of (i) the occurrence of a Transfer of Control, unless the surviving, continuing, successor, or purchasing corporation, as
		

		
			 
		

		
			
		

		
			

		 

		

			6

		

 

		

		
			the case may be, assumes the Company’s rights and obligations under the Plan or (ii) the existence of a public market for the class of shares subject to the Right of First Refusal. A “public market” shall be deemed to exist if (x) such stock is listed on a national securities exchange (as that term is used in the Exchange Act) or (y) such stock is traded on the over-the-counter market and prices therefor are published daily on business days in a recognized financial journal.
		

		
			 
		

		
			(j)           Escrow. To ensure shares of Stock subject to Right of First Refusal will be available for repurchase, the Company may require an Optionee to deposit certificates evidencing the Exercise Shares in escrow with the Company or an agent of the Company.
		

		
			 
		

		
			15.          Legends. The Company may at any time place legends referencing any applicable federal or state securities law restriction on all certificates representing shares of stock subject to the provisions of this Option Agreement. The Optionee shall, at the request of the Company, promptly present to the Company any and all certificates representing shares acquired pursuant to the Option in the possession of the Optionee in order to effectuate the provisions of this Paragraph. Unless otherwise specified by the Company, legends placed on such certificates may include, but shall not be limited to, the following:
		

		
			 
		

		
			(a)          THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SHARES, THE SALE IS MADE IN ACCORDANCE WITH RULE 144 OR RULE 701 UNDER THE ACT, OR THE CORPORATION RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE SHARES REASONABLY SATISFACTORY TO THE CORPORATION, STATING THAT SUCH SALE, TRANSFER ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.
		

		
			 
		

		
			(b)          THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A RTGHT OF FIRST REFUSAL OPTION IN FAVOR OF THE CORPORATION OR ITS ASSIGNEE SET FORTH IN THE CORPORATION’S STOCK OPTION PLAN AND AN AGREEMENT BETWEEN THE CORPORATION AND THE REGISTERED HOLDER, OR SUCH HOLDER’S PREDECESSOR IN INTEREST, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THIS CORPORATION.
		

		
			 
		

		
			(c)          THE SHARES EVIDENCED BY THIS CERTIFICATE WERE ISSUED BY THE CORPORATION TO THE REGISTERED HOLDER UPON EXERCISE OF AN INCENTIVE STOCK OPTION AS DEFINED IN SECTION 422 OF THE INTERNAL REVENUE CODE OF 1986, AS
		

		
			 
		

		
			
		

		
			

		 

		

			7

		

 

		

		
			AMENDED. THE TRANSFER AGENT FOR THE SHARES EVIDENCED HEREBY SHALL NOTIFY THE CORPORATION IMMEDIATELY OF ANY TRANSFER OF THE SHARES BY THE REGISTERED HOLDER HEREOF MADE ON OR BEFORE THE REGISTERED HOLDER SHALL HOLD ALL SHARES PURCHASED UNDER THE OPTION IN THE REGISTERED HOLDER’S NAME (AND NOT IN THE NAME OF ANY NOMINEE) FOR A PERIOD OF ONE YEAR FROM THE DATE OF EXERCISE OF THE OPTION OR TWO YEARS FROM THE DATE OF GRANT OF THE OPTION.
		

		
			 
		

		
			16.          Initial Public Offering. The event of an initial public offering of stock made by the Company under the Securities Act, Optionee shall offer, sell, contract to sell, pledge, hypothecate, grant any option to purchase or make any short sale of, or otherwise dispose of any shares of stock of the Company or any rights to acquire stock of the Company for such period of time as may be established by the underwriter for such initial public offering; provided, however, that such period of time shall not exceed one hundred eighty (180) days from the effective date of the registration statement to be filed in connection with such initial public offering.
		

		
			 
		

		
			17.          Miscellaneous
		

		
			 
		

		
			(a)          Nothing in this Plan or any Option granted hereunder shall confer upon any Optionee any right to continue in the employ of the Company, or to serve as a director, consultant or advisor thereof, or interfere in any way with the right of the Company to terminate such Optionee’s employment at any time. Unless specifically provided otherwise, no grant of an Option shall be deemed salary or compensation for the purpose of computing benefits under any employee benefit plan or other arrangement of the Company for the benefit of its employees unless the Company shall determine otherwise. No Optionee shall have any claim to an Option until it is actually granted under the Plan. To the extent that any person acquires a right to receive payments from the Company under the Plan, such right shall, except as otherwise provided by the Board, be no greater than the right of an unsecured general creditor of the Company.
		

		
			 
		

		
			(b)          The Plan and the grant of Options hereunder shall be subject to all applicable federal and state laws, rules, and regulations and to such approvals by any United States government or regulatory agency as may be required.
		

		
			 
		

		
			(c)          The terms of the Plan shall be binding upon the Company, and its successors and assigns.
		

		
			 
		

		
			(d)          This Plan and all awards taken hereunder shall be governed by the laws of the State of Delaware, without regard to the conflicts of laws of Delaware, without regard to the conflicts of laws rules of Delaware.
		

		
			 
		

		
			
		

		
			

		 

		

			8

		

 

		

		
			(e)          If any provision of this Plan or a Form Option Agreement is or becomes or is deemed invalid, illegal or unenforceable in any jurisdiction, or would disqualify the Plan or any Form Option Agreement under any law deemed applicable by the Board, such provision shall be construed or deemed amended to conform to applicable laws or if it cannot be construed or deemed amended without, in the determination of the Board, materially altering the intent of the Plan or the Form Option Agreement, it shall be stricken and the remainder of the Plan or the Form Option Agreement shall remain in full force and effect.
		

		
			 
		

		
			(f)           The Board may incorporate additional or alternative provisions for this Plan with respect to residents of one or more individual states to the extent necessary or desirable under state securities laws. Such provisions shall be set out in one or more appendices hereto which may be amended or deleted by the Board from time to time.
		

		
			 
		

		
			IN WITNESS WHEREOF, the undersigned Secretary of the Company certifies that the foregoing Plan was duly adopted by the Board of Directors of the Company on the 6th day of November, 2004 and approved by the stockholders of the Company on the 9th day of November, 2004.
		

		
			 
		

			
					
						 

					
					
						LIQUIDIA TECHNOLOGIES, INC.

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						/s/ Fred D. Hutchison

				
	
					
						 

					
					
						 

					
					
						Fred D. Hutchison, Secretary

				

		
			 
		

		
			
		

		
			

		 

		

			9

		

 

		

		
			APPENDIX A
		

		
			 
		

		
			LIQUIDIA TECHNOLOGIES, INC.
		

		
			STOCK OPTION PLAN (the “Plan”)
		

		
			 
		

		
			Provisions Applicable to California Residents
		

		
			 
		

		
			Notwithstanding anything to the contrary otherwise appearing the Plan, the following provisions shall apply to any stock option or other award granted under the Plan to a resident of the State of California and, in the event of any conflict or inconsistency between the following provisions and the provisions otherwise appearing in the Plan, the following provisions shall control, solely with respect to options or other awards granted under the Plan to residents of the State of California:
		

		
			 
		

			
	
			
				 ·
			

			
	
			
			At no time shall the total number of shares of Company stock issuable upon exercise of all outstanding stock options granted pursuant to this Plan and the total number of shares provided for under any bonus or similar plan or agreement of the Company exceed the limitations set forth in Rule 260.140.45 promulgated under the California Code, based on the number of shares of the Company which are outstanding at the time the calculation is made.

		
			 
		

			
	
			
				 ·
			

			
	
			
			The exercise price of an option granted to a California resident may not be less than 85% of the “fair value” (as defined by Rule 260.140.50 promulgated under the California Code) of the Company’s common stock at the time the option is granted (or 110% of the “fair value” in the case of any person who owns stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or its parent or subsidiary corporations at the time of such grant).

		
			 
		

			
	
			
				 ·
			

			
	
			
			The exercise period of a stock option granted to a California resident shall be no longer than 120 months from the date the option is granted.

		
			 
		

			
	
			
				 ·
			

			
	
			
			An option granted to a California resident shall not be transferable, other than by will or the laws of descent and distribution, or as permitted by Rule 701 of the Securities Act of 1933, as amended.

		
			 
		

			
	
			
				 ·
			

			
	
			
			An option granted to a California resident shall become exercisable at the rate of at least 20% per year over 5 years from the date the option is granted, subject to reasonable conditions such as continued employment. However, in the case of an option granted to a California resident who is an officer, director, or consultant of the Company or any of its affiliates, the option may become fully exercisable, subject to reasonable conditions such as continued employment, at any time or during any period established by the Company.

		
			 
		

			
	
			
				 ·
			

			
	
			
			Unless employment is terminated for cause as defined by applicable law, the terms of the Plan or stock option agreement or a contract of employment, the right to exercise an option granted to a California resident in the event of termination of such optionee’s employment (to the extent that such optionee is otherwise entitled to exercise on the date of termination of employment) shall terminate as follows:

		
			 
		

		
			
		

		
			

		 

		

			10

		

 

		

		
			 
		

			
	
			
				 ·
			

			
	
			
			At least 6 months from the date of termination if termination was caused by death or disability; or

		
			 
		

			
	
			
				 ·
			

			
	
			
			At least 30 days from the date of termination if termination was caused by an event other than death or disability.

		
			 
		

			
	
			
				 ·
			

			
	
			
			The Plan shall terminate with respect to California residents on the earlier of ten years after the date the Plan is adopted or the date the Plan is approved by the shareholders of the Company.

		
			 
		

			
	
			
				 ·
			

			
	
			
			The Plan shall be available to California residents only if the stockholders of the Company approve the Plan within 12 months before or after the date the Plan is adopted. Any option exercised by a California resident before such stockholder approval is obtained shall be rescinded if such stockholder approval is not subsequently obtained and such shares shall not be counted in determining whether the required stockholder approval is obtained.

		
			 
		

			
	
			
				 ·
			

			
	
			
			Each California resident participating in the Plan will be provided with a copy of the Company’s annual financial statements (which need not be audited). The Company shall not be required to provide such statements to key employees whose duties with the Company assure access to equivalent information.

		
			 
		

		
			 
		

		
			

		 

		

			11

		

 

		

		
			EXHIBIT A
		

		
			 
		

		
			THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
		

		
			 
		

		
			LIQUIDIA TECHNOLOGIES, INC.
		

		
			INCENTIVE STOCK OPTION AGREEMENT
		

		
			 
		

		
			Liquidia Technologies, Inc., a Delaware corporation (the “Company”), hereby grants to the individual named below an option (the “Option”) to purchase certain shares of common stock of the Company pursuant to the Liquidia Technologies, Inc. Stock Option Plan, in the manner and subject to the provisions of this Option Agreement.
		

		
			 
		

		
			1.            Definitions:
		

		
			 
		

		
			(a)          “Code” shall mean the Internal Revenue Code of 1986, as amended. (All citations to Sections of the Code are to such Sections as they may from time to time be amended or renumbered.)
		

		
			 
		

		
			(b)          “Company” shall mean Liquidia Technologies, Inc., a Delaware corporation, and any successor corporation thereto.
		

		
			 
		

		
			(c)          “Date of Option Grant” shall mean                        .
		

		
			 
		

		
			(d)          “Disability” shall mean disability within the meaning of Section 22(e)(3) of the Code, as determined by the Board of Directors of the Company (the “Board”) in its discretion under procedures established by the Board.
		

		
			 
		

		
			(e)          “Exercise Price” shall mean                 ($         ) per share as adjusted from time to time pursuant to Paragraph 9 of the Plan.
		

		
			 
		

		
			(f)           “Number of Option Shares” shall mean                       (          ) shares of Class A Voting Common Stock of the Company as adjusted from time to time pursuant to Paragraph 9 of the Plan.
		

		
			 
		

		
			(g)          “Option Term Date” shall mean the date ten (10) years after the Date of Option Grant.
		

		
			 
		

		
			(h)          “Optionee” shall mean                    .
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

		
			(i)           “Plan” shall mean the Liquidia Technologies, Inc. Stock Option Plan.
		

		
			 
		

		
			2.            Status of the Option. The Option is intended to be an incentive stock option as described in Section 422 of the Code, but the Company does not represent or warrant that the Option qualifies as such. The Optionee should consult with the Optionee’s own tax advisors regarding the tax effects of the Option and the requirements necessary to obtain favorable income tax treatment under Section 422 of the Code.
		

		
			 
		

		
			3.            Administration. All questions of interpretation concerning the Option shall be determined by the Board and shall be final and binding upon all persons having an interest in the Option.
		

		
			 
		

		
			4.            Exercise of the Option.
		

		
			 
		

		
			(a)          Right to Exercise. The Option shall become exercisable as set forth below, from subject to the termination provisions of Paragraphs 6 and 7 hereof and the Optionee’s acknowledgement and agreement that any shares purchased upon exercise are subject to the Company’s repurchase rights set forth in the Company’s Bylaws:
		

		
			 
		

		
			(i)           On and after                   , the Option may be exercised to purchase up to 25% of the Number of Option Shares.
		

		
			 
		

		
			(ii)          On or after the last day of each successive full month of service as an employee of a Participating Company beginning on or after the Initial Vesting Date, the Option may be exercised to purchase up to an additional 2.084% of the Number of Option Shares.
		

		
			 
		

		
			This provision shall be interpreted such that on or after                   , the Option may be exercised to purchase up to 100% of the Number of Option Shares.
		

		
			 
		

		
			The schedule set forth above is cumulative, so that shares as to which the Option has become exercisable on and after a date indicated by the schedule may be purchased pursuant to exercise of the Option at any subsequent date prior to termination of the Option pursuant to Paragraph 6 hereof. The Option may be exercised at any time and from time to time to purchase up to the number of shares as to which it is then exercisable.
		

		
			 
		

		
			Notwithstanding the foregoing, if the aggregate fair market value, determined as of the Date of Option Grant, of the stock with respect to which the Option may be exercised (determined without regard to this provision) for the first time during any calendar year (under this Plan), as determined in accordance with Section 422(d) of the Code, shall exceed one hundred thousand dollars ($100,000), the Option shall be deemed a nonqualified stock option to the extent of such excess.
		

		
			 
		

		
			
		

		
			

		 

		

			2

		

 

		

		
			(b)          Method of Exercise. The Option shall be exercised by written notice to the Company in the form of Exhibit A hereto.
		

		
			 
		

		
			(c)          Restrictions on Grant of the Option and Issuance of Shares. The grant of the Option and the issuance of the shares upon exercise of the Option shall be subject to compliance with all applicable requirements of federal or state law with respect to such securities. The Option may not be exercised if the issuance of shares upon such exercise would constitute a violation of any applicable federal or state securities laws or other law or regulations. In addition, no Option may be exercised unless (i) a registration statement under the Securities Act of 1933, as amended (the “Securities Act”), shall at the time of exercise of the Option be in effect with respect to the shares issuable upon exercise of the Option or (ii) in the opinion of legal counsel to the Company, the shares issuable upon exercise of the Option may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act.
		

		
			 
		

		
			THE OPTIONEE IS CAUTIONED THAT THE OPTION MAY NOT BE EXERCISABLE UNLESS THE FOREGOING CONDITIONS ARE SATISFIED. ACCORDINGLY, THE OPTIONEE MAY NOT BE ABLE TO EXERCISE THE OPTION WHEN DESIRED EVEN THOUGH THE OPTION IS EXERCISABLE PURSUANT TO THE TERMS HEREOF.
		

		
			 
		

		
			As a condition to the exercise of the Option, the Company may require the Optionee to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company.
		

		
			 
		

		
			5.            Non-Transferability of the Option. The Option and may not be assigned or transferred in any manner except by will or by the laws of descent and distribution.
		

		
			 
		

		
			6.            Termination of the Option. The Option shall terminate upon on the first to occur of: (a) the Option Term Date; (b) the last date for exercising the Option following termination of employment as described in Paragraph 7 hereof, or (c) upon a Transfer of Control as described in Paragraph 8 of the Plan.
		

		
			 
		

		
			7.            Termination of Employment.
		

		
			 
		

		
			(a)          Termination of the Option. If the Optionee ceases to be an employee of the Company for any reason except death or Disability, the Option, to the extent exercisable by the Optionee on the date on which the Optionee ceased to be an employee, may be exercised by the Optionee until the earlier of (i) three (3) months after the date on which the Optionee’s employment terminates or (ii) the Option Term Date. Notwithstanding the foregoing, if the Optionee’s employment with the Company is terminated for cause (as determined in the sole discretion of the Board), the Option may not be exercised after the date on which the
		

		
			 
		

		
			
		

		
			

		 

		

			3

		

 

		

		
			Optionee’s employment terminates. If the Optionee’s employment with the Company is terminated because of the death or Disability of the Optionee, the Option, to the extent exercisable by the Optionee on the date on which the Optionee ceased to be an employee, may be exercised by the Optionee (or the Optionee’s legal representative) until the earlier of (i) the expiration of twelve (12) months from the date the Optionee’s employment terminated, (ii) the Option Term Date. The Optionee’s employment shall be deemed to have terminated on account of death if the Optionee dies within three (3) months after the Optionee’s termination of employment. This Paragraph shall be interpreted such that the Option shall not become exercisable as to any additional number of Option Shares after the date on which the Optionee ceases to be an employee of the Participating Company Group (pursuant to this Paragraph 7) for any reason, notwithstanding any period after such cessation of employment during which the Option may remain exercisable as provided in this Paragraph 7.
		

		
			 
		

		
			(b)          Exercise Prevented by Law. Except as provided in this Paragraph 7, the Option shall terminate and may not be exercised after the Optionee’s employment with the Company terminates unless the exercise of the Option in accordance with this Paragraph 7 is prevented by the provisions of Paragraph 4(c) hereof. If the exercise of the Option is so prevented, the Option shall remain exercisable until the earlier of (i) three (3) months after the date the Optionee is notified by the Company that the Option is exercisable or (ii) the Option Term Date.
		

		
			 
		

		
			(c)          Optionee Subject to Section 16(b). Notwithstanding the foregoing, if the exercise of the Option within the applicable time periods set forth above would subject the Optionee to suit under Section 16(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Option shall remain exercisable until the earliest to occur of (i) the tenth (10th) day following the date on which the Optionee would no longer be subject to such suit, (ii) the one hundred and ninetieth (190th) day after the Optionee’s termination of employment, or (iii) the Option Term Date.
		

		
			 
		

		
			(d)          Leave of Absence. For purposes hereof, the Optionee’s employment with the Company shall not be deemed to terminate if the Optionee takes any military leave, sick leave, or other bona fide leave of absence approved by the Company of ninety (90) days or less. In the event of a leave in excess of ninety (90) days, the Optionee’s employment shall be deemed to terminate on the ninety-first (91st) day of the leave unless the Optionee’s right to reemployment with the Company remains guaranteed by statute or contract.
		

		
			 
		

		
			8.            Rights as a Stockholder or Employee. The Optionee shall have no rights as a stockholder with respect to any shares covered by the Option until the date of the issuance of a certificate or certificates for the shares for which the Option has been exercised. Nothing in the Option shall confer upon the Optionee any right to continue in the employ of the Company or interfere in any way with any right of the Company to terminate the Optionee’s employment at any time.
		

		
			 
		

		
			
		

		
			

		 

		

			4

		

 

		

		
			9.            Notice of Sales Upon Disqualifying Disposition. The Optionee shall dispose of the shares acquired pursuant to the Option only in accordance with the provisions of this Option Agreement. In addition, the Optionee shall promptly notify the Chief Financial Officer of the Company if the Optionee disposes of any of the shares acquired pursuant to the Option within one (1) year from the date the Optionee exercises all or part of the Option or within two (2) years of the date of grant of the Option. Until such time as the Optionee disposes of such shares in a manner consistent with the provisions of this Option Agreement, the Optionee shall hold all shares acquired pursuant to the Option in the Optionee’s name (and not in the name of any nominee) for the one-year period immediately after exercise of the Option and the two-year period immediately after grant of the Option. At any time during the one-year or two-year periods set forth above, the Company may place a legend or legends on any certificate or certificates representing shares acquired pursuant to the Option requesting the transfer agent for the Company’s stock to notify the Company of any such transfers. The obligation of the Optionee to notify the Company of any such transfer shall continue notwithstanding that a legend has been placed on the certificate or certificates pursuant to the preceding sentence.
		

		
			 
		

		
			10.          Binding Effect. This Option Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators, successors and assigns.
		

		
			 
		

		
			11.          Termination or Amendment. The Board may terminate or amend this Option Agreement at any time; provided, however, that no such termination or amendment may adversely affect the Option or any unexercised portion hereof without the consent of the Optionee unless such amendment is required to enable the Option to qualify as an Incentive Stock Option.
		

		
			 
		

		
			12.          Integrated Agreement. This Option Agreement, together with the Plan and the Company’s bylaws, constitute the entire understanding and agreement of the Optionee and the Company with respect to the subject matter contained herein, and there are no other agreements, understandings, restrictions, representations, or warranties among the Optionee and the Company with respect to the subject matter contained herein other than those as set forth or provided for herein and therein. To the extent contemplated herein, the provisions of this Option Agreement shall survive any exercise of the Option and shall remain in full force and effect. The terms and conditions included in the Plan are incorporated by reference herein, and to the extent that any conflict may exist between any term or provision of this Option Agreement and any term or provision of the Plan, the term or provision of the Plan shall control.
		

		
			 
		

		
			13.          Applicable Law. This Option Agreement shall be governed by the laws of the State of Delaware as such laws are applied to agreements between Delaware residents entered into and to be performed entirely within the State of Delaware.
		

		
			 
		

		
			14.          Effect of Certain Transactions. Notwithstanding anything to contrary in this Option Agreement, in the event that the Optionee has entered into a nondisclosure, invention
		

		
			 
		

		
			
		

		
			

		 

		

			5

		

 

		

		
			and/or non-competition agreement with the Company and the Optionee is determined, in the reasonable judgment of the Company’s Board of Directors, to have materially breached such agreement, the Optionee shall forfeit any shares acquired pursuant to the Option and 100% of the Option granted pursuant to this Option Agreement, whether or not exercisable.
		

		
			 
		

			
					
						 

					
					
						LIQUIDIA TECHNOLOGIES, INC.

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			The Optionee represents that the Optionee is familiar with the terms and provisions of this Option Agreement, including the right of first refusal set forth in the Company’s bylaws, and hereby accepts the Option subject to all of the terms and provisions thereof. The Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board of Directors of the Company made in good faith upon any questions arising under this Option Agreement.
		

		
			 
		

		
			The undersigned hereby acknowledges receipt of a copy of the Plan.
		

		
			 
		

			
					
						Date:

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						(Signature of Optionee)

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						(Printed Name of Optionee)

				

		
			 
		

		
			 
		

		
			

		 

		

			6

		

 

		

		
			EXHIBIT A
		

		
			 
		

		
			[Date]
		

		
			 
		

		
			 
		

		
			 
		

		
			 
		

		
			Re:         Exercise of Incentive Stock Option
		

		
			 
		

		
			Dear Sirs:
		

		
			 
		

		
			Pursuant to the terms and conditions of the Incentive Stock Option Award Agreement dated as of                   , 200             (the “Agreement”), between                    (“Optionee”) and Liquidia Technologies, Inc. (the “Company”), Optionee hereby agrees to purchase                    shares (the “Shares”) of the Class A Voting Common Stock of the Company and tender payment in full for such shares in accordance with the terms of the Agreement.
		

		
			 
		

		
			The Shares are being issued to Optionee in a transaction not involving a public offering and pursuant to an exemption from registration under the Securities Act of 1933, as amended (the “1933 Act”). In connection with such purchase, Optionee represents, warrants and agrees as follows:
		

		
			 
		

		
			1.     The Shares are being purchased for the Optionee’s own account and not for the account of any other person, with the intent of holding the Shares for investment and not with the intent of participating, directly or indirectly, in a distribution or resale of the Shares or any portion thereof.
		

		
			 
		

		
			2.     The Optionee is not acquiring the Shares based upon any representation, oral or written, by any person with respect to the future value of, or income from, the Shares, but rather upon independent examination and judgment as to the prospects of the Company.
		

		
			 
		

		
			3.     The Optionee has had complete access to and the opportunity to review all material documents related to the business of the Company, has examined all such documents as the Optionee desired, is familiar with the business and affairs of the Company and realizes that any purchase of the Shares is a speculative investment and that any possible profit therefrom is uncertain.
		

		
			 
		

		
			4.     The Optionee has had the opportunity to ask questions of and receive answers from the Company and its executive officers and to obtain all information necessary for the Optionee to make an informed decision with respect to the investment in the Company represented by the Shares.
		

		
			 
		

		
			
		

		
			

		 

		

			 

		

 

		

		
			5.     The Optionee is able to bear the economic risk of any investment in the Shares, including the risk of a complete loss of the investment, and the Optionee acknowledges that he or she may need to continue to bear the economic risk of the investment in the Shares for an indefinite period.
		

		
			 
		

		
			6.     The Optionee understands and agrees that the Shares are being issued and sold to the Optionee without registration under any state or federal laws relating to the registration of securities, in reliance upon exemptions from registration under appropriate state and federal laws based in part upon the representations of the Optionee made herein.
		

		
			 
		

		
			7.     The Company is under no obligation to register the Shares or to comply with any exemption available for sale of the Shares by the Optionee without registration, and the Company is under no obligation to act in any manner so as to make Rule 144 promulgated under the 1933 Act available with respect to any sale of the Shares by the Optionee.
		

		
			 
		

		
			8.     The Optionee has not relied upon the Company or an employee or agent of the Company with respect to any tax consequences related to exercise of this Option or the disposition of the Shares. The Optionee assumes full responsibility for all such tax consequences and the filing of all tax returns and elections the Optionee may be required to or find desirable to file in connection therewith.
		

		
			 
		

			
					
						 

					
					
						Very truly yours,

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						Print Name:

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						(Address)

				

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

		
			EXHIBIT B
		

		
			 
		

		
			THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
		

		
			 
		

		
			LIQUIDIA TECHNOLOGIES, INC.
		

		
			NONQUALIFIED STOCK OPTION AGREEMENT
		

		
			 
		

		
			Liquidia Technologies, Inc., a Delaware corporation (the “Company”), hereby grants to the individual named below an option (the “Option”) to purchase certain shares of common stock of the Company pursuant to the Liquidia Technologies, Inc. Stock Option Plan, in the manner and subject to the provisions of this Option Agreement.
		

		
			 
		

		
			1.            Definitions:
		

		
			 
		

		
			(a)          “Code” shall mean the Internal Revenue Code of 1986, as amended. (All citations to Sections of the Code are to such Sections as they may from time to time be amended or renumbered.)
		

		
			 
		

		
			(b)          “Company” shall mean Liquidia Technologies, Inc., a Delaware corporation, and any successor corporation thereto.
		

		
			 
		

		
			(c)          “Date of Option Grant” shall mean                    .
		

		
			 
		

		
			(d)          “Exercise Price” shall mean Dollars                           ($                  ) per share, as adjusted from time to time pursuant to Paragraph 9 of the Plan.
		

		
			 
		

		
			(e)          “Number of Option Shares” shall mean                       (               ) shares of Class A Voting Common Stock of the Company as adjusted from time to time pursuant to Paragraph 9 of the Plan.
		

		
			 
		

		
			(f)           “Option Term Date” shall mean the date ten (10) years after the Date of Option Grant.
		

		
			 
		

		
			(g)          “Optionee” shall mean                  .
		

		
			 
		

		
			(h)          “Plan” shall mean the Liquidia Technologies, Inc. Stock Option Plan.
		

		
			 
		

		
			(i)           “Transfer of Control” shall mean a merger, consolidation, corporate reorganization or any transaction in which all or substantially all of the assets of
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

		
			the Company are sold, leased, transferred or otherwise disposed of (other than a mere reincorporation transaction or one in which the holders of capital stock of the Company immediately prior to such merger or consolidation continue to hold at least a majority of the voting power of the surviving corporation).
		

		
			 
		

		
			2.            Nonqualified Stock Option. The Option is intended to be a nonqualified stock option. The Optionee should consult with the Optionee’s own tax advisors regarding the tax effects of this Option.
		

		
			 
		

		
			3.            Administration. All questions of interpretation concerning this Option Agreement shall be determined by the Board of Directors (the “Board”) and shall be final and binding upon all persons having an interest in the Option.
		

		
			 
		

		
			4.            Exercise of the Option.
		

		
			 
		

		
			(a)   Right to Exercise. The Option shall become exercisable from time to time, subject to the schedule set forth below, in whole or in part, and subject to the termination provisions of Paragraphs 6 and 7 hereof and the Optionee’s acknowledgement and agreement that any shares purchased upon exercise are subject to the Company’s repurchase rights set forth in the Company’s Bylaws:
		

		
			 
		

		
			(i)           On and after                , the Option may be exercised to purchase up to 25% of the Number of Option Shares.
		

		
			 
		

		
			(ii)          On or after the last day of each successive month thereafter, the Option may be exercised to purchase up to an additional               % of the Number of Option Shares.
		

		
			 
		

		
			This provision shall be interpreted such that on or after                         , the Option may be exercised to purchase up to 100% of the Number of Option Shares.
		

		
			 
		

		
			The schedule set forth above is cumulative, so that shares as to which the Option has become exercisable on and after a date indicated by the schedule may be purchased pursuant to exercise of the Option at any subsequent date prior to termination of the Option pursuant to Paragraph 6 hereof. The Option may be exercised at any time and from time to time to purchase up to the number of shares as to which it is then exercisable.
		

		
			 
		

		
			(b)          Method of Exercise. The Option shall be exercised by written notice to the Company in the form of Exhibit A hereto.
		

		
			 
		

		
			(c)          Restrictions on Grant of the Option and Issuance of Shares. The grant of the Option and the issuance of the shares upon exercise of the Option shall be subject to compliance with all applicable requirements of federal or state law with respect to such securities. The Option may not be exercised if the issuance of shares upon
		

		
			 
		

		
			
		

		
			

		 

		

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			such exercise would constitute a violation of any applicable federal or state securities laws or other law or regulations. In addition, no Option may be exercised unless (i) a registration statement under the Securities Act of 1933, as amended (the “Securities Act”), shall at the time of exercise of the Option be in effect with respect to the shares issuable upon exercise of the Option or (ii) in the opinion of legal counsel to the Company, the shares issuable upon exercise of the Option may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act.
		

		
			 
		

		
			THE OPTIONEE IS CAUTIONED THAT THE OPTION MAY NOT BE EXERCISABLE UNLESS THE FOREGOING CONDITIONS ARE SATISFIED. ACCORDINGLY, THE OPTIONEE MAY NOT BE ABLE TO EXERCISE THE OPTION WHEN DESIRED EVEN THOUGH THE OPTION IS EXERCISABLE PURSUANT TO THE TERMS HEREOF.
		

		
			 
		

		
			As a condition to the exercise of the Option, the Company may require the Optionee to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company.
		

		
			 
		

		
			5.            Non-Transferability of the Option. The Option may not be assigned or transferred in any manner except by will or by the laws of descent and distribution.
		

		
			 
		

		
			6.            Termination of the Option. The Option shall terminate upon the first to occur of: (a) the Option Term Date; (b) the last date for exercising the Option following termination of engagement as described in Paragraph 7 below; or (c) upon a Transfer of Control as described in Paragraph 8 of the Plan.
		

		
			 
		

		
			7.            Termination of Engagement.
		

		
			 
		

		
			(a)          Termination of the Option. If the Optionee ceases for any reason to be engaged with the Company, the Option, to the extent exercisable by the Optionee on the date on which the Optionee ceased to be so engaged, may be exercised by the Optionee until the earlier of (i) three (3) months after the date on which the Optionee’s engagement terminates or (ii) the Option Term Date. Notwithstanding the foregoing, if the Optionee’s engagement is terminated for cause (as determined in the sole discretion of the Board) the Option may not be exercised after the date on which the engagement is so terminated. This Option Agreement shall be interpreted such that the Option shall not become exercisable as to any additional Option Shares after the date on which the Optionee ceases to be engaged with the Company.
		

		
			 
		

		
			(b)          Exercise Prevented by Law. Except as provided in this Paragraph 7, the Option shall terminate and may not be exercised after the Optionee’s employment with the Company terminates unless the exercise of the Option in accordance with this
		

		
			 
		

		
			
		

		
			

		 

		

			3

		

 

		

		
			Paragraph 7 is prevented by the provisions of Paragraph 4(c) above. If the exercise of the Option is so prevented, the Option shall remain exercisable until the earlier of (i) three (3) months after the date the Optionee is notified by the Company that the Option is exercisable or (ii) the Option Term Date.
		

		
			 
		

		
			(c)          Optionee Subject to Section 16(b). Notwithstanding the foregoing, if the exercise of the Option within the applicable time periods set forth above would subject the Optionee to suit under Section 16(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Option shall remain exercisable until the earliest to occur of (i) the tenth (10th) day following the date on which the Optionee would no longer be subject to such suit, (ii) the one hundred and ninetieth (190th) day after the Optionee’s termination of employment, or (iii) the Option Term Date.
		

		
			 
		

		
			(d)          Engagement with the Company. For purposes of this Option Agreement, “engagement with the Company” shall mean service as a director, consultant or advisor to the Company.
		

		
			 
		

		
			8.            Rights as a Stockholder or Employee. The Optionee shall have no rights as a stockholder with respect to any shares covered by the Option until the date of the issuance of a certificate or certificates for the shares for which the Option has been exercised. Nothing in the Option shall confer upon the Optionee any right to engagement with the Company or interfere in any way with any right of the Company to terminate the Optionee’s engagement at any time.
		

		
			 
		

		
			9.            Binding Effect. This Option Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators, successors and assigns.
		

		
			 
		

		
			10.          Termination or Amendment. The Board may terminate or amend this Option Agreement at any time; provided, however, that no such termination or amendment may adversely affect the Option or any unexercised portion hereof without the consent of the Optionee.
		

		
			 
		

		
			11.          Integrated Agreement. This Option Agreement, together with the Plan and the Company’s bylaws, constitute the entire understanding and agreement of the Optionee and the Company with respect to the subject matter contained herein, and there are no other agreements, understandings, restrictions, representations, or warranties among the Optionee and the Company with respect to the subject matter contained herein other than those as set forth or provided for herein and therein. To the extent contemplated herein, the provisions of this Option Agreement shall survive any exercise of the Option and shall remain in full force and effect. The terms and conditions included in the Plan are incorporated by reference herein, and to the extent that any conflict may exist between any term or provision of this Option Agreement and any term or provision of the Plan, the term or provision of the Plan shall control.
		

		
			 
		

		
			
		

		
			

		 

		

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			12.          Applicable Law. This Option Agreement shall be governed by the laws of the State of Delaware as such laws are applied to agreements between Delaware residents entered into and to be performed entirely within the State of Delaware.
		

		
			 
		

		
			13.          Effect of Certain Transactions. Notwithstanding anything to contrary in this Option Agreement, in the event that the Optionee has entered into a nondisclosure, invention and/or non-competition agreement with the Company and the Optionee is determined, in the reasonable judgment of the Company’s Board of Directors, to have materially breached any such agreement, the Optionee shall forfeit any shares acquired pursuant to the Option and 100% of the Option granted pursuant to this Option Agreement, whether or not exercisable.
		

		
			 
		

			
					
						 

					
					
						LIQUIDIA TECHNOLOGIES, INC.

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Name:

					
					
						 

				
	
					
						 

					
					
						 

					
					
						Title:

					
					
						 

				

		
			 
		

		
			The Optionee represents that the Optionee is familiar with the terms and provisions of this Option Agreement, including the right of first refusal set forth in the Company’s Bylaws, and hereby accepts the Option subject to all of the terms and provisions thereof. The Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board of Directors of the Company made in good faith upon any questions arising under this Option Agreement.
		

		
			 
		

		
			The undersigned hereby acknowledges receipt of a copy of the Plan.
		

		
			 
		

			
					
						Date:

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						(Signature of Optionee)

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						(Printed Name of Optionee)

				

		
			 
		

		
			 
		

		
			

		 

		

			5

		

 

		

		
			EXHIBIT A
		

		
			 
		

		
			[Date]
		

		
			 
		

		
			 
		

		
			 
		

		
			 
		

		
			 
		

		
			Re:         Exercise of Non-Qualified Stock Option
		

		
			 
		

		
			Dear Sirs:
		

		
			 
		

		
			Pursuant to the terms and conditions of the Nonqualified Stock Option Award Agreement dated as of              , 200  (the “Agreement”), between                     (“Optionee”) and Liquidia Technologies, Inc. (the “Company”), the Optionee hereby agrees to purchase          shares (the “Shares”) of the Class A Voting Common Stock of the Company and tender payment in full for such shares in accordance with the terms of the Agreement.
		

		
			 
		

		
			The Shares are being issued to Optionee in a transaction not involving a public offering and pursuant to an exemption from registration under the Securities Act of 1933, as amended (the “1933 Act”). In connection with such purchase, Optionee represents, warrants and agrees as follows:
		

		
			 
		

		
			1.     The Shares are being purchased for the Optionee’s own account, and not for the account of any other person, with the intent of holding the Shares for investment and not with the intent of participating, directly or indirectly, in a distribution or resale of the Shares or any portion thereof.
		

		
			 
		

		
			2.     The Optionee is not acquiring the Shares based upon any representation, oral or written, by any person with respect to the future value of, or income from, the Shares, but rather upon independent examination and judgment as to the prospects of the Company.
		

		
			 
		

		
			3.     The Optionee has had complete access to and the opportunity to review all material documents related to the business of the Company, has examined all such documents as the Optionee desired, is familiar with the business and affairs of the Company and realizes that any purchase of the Shares is a speculative investment and that any possible profit therefrom is uncertain.
		

		
			 
		

		
			4.     The Optionee has had the opportunity to ask questions of and receive answers from the Company and its executive officers and to obtain all information necessary for the Optionee to make an informed decision with respect to the investment in the Company represented by the Shares.
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

 

		

		
			5.     The Optionee is able to bear the economic risk of any investment in the Shares, including the risk of a complete loss of the investment, and the Optionee acknowledges that he or she may need to continue to bear the economic risk of the investment in the Shares for an indefinite period.
		

		
			 
		

		
			6.     The Optionee understands and agrees that the Shares are being issued and sold to the Optionee without registration under any state or federal laws relating to the registration of securities, in reliance upon exemptions from registration under appropriate state and federal laws based in part upon the representations of the Optionee made herein.
		

		
			 
		

		
			7.     The Company is under no obligation to register the Shares or to comply with any exemption available for sale of the Shares by the Optionee without registration, and the Company is under no obligation to act in any manner so as to make Rule 144 promulgated under the 1933 Act available with respect to any sale of the Shares by the Optionee.
		

		
			 
		

		
			8.     The Optionee has not relied upon the Company or an employee or agent of the Company with respect to any tax consequences related to exercise of this Option or the disposition of the Shares. The Optionee assumes full responsibility for all such tax consequences and the filing of all tax returns and elections the Optionee may be required to or find desirable to file in connection therewith.
		

		
			 
		

			
					
						 

					
					
						Very truly yours,

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						Print Name:

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						(Address)

				

		
			 
		

		 

		

			6lqda_Ex10_20

		
			Exhibit 10.20
		

		
			 
		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			MANUFACTURING DEVELOPMENT AND SCALE-UP AGREEMENT
		

		
			 
		

		
			This Manufacturing Development and Scale-up Agreement (the “Agreement”) is made as of March 19, 2012 (the “Effective Date”), between Liquidia Technologies, Inc., a Delaware corporation (“Liquidia”) having its principal place of business at Suite 100, 419 Davis Drive, Morrisville, NC  27560 and Chasm Technologies, Inc., a Massachusetts corporation (“Chasm”) with principal offices located at 85 Wagon Rd, Westwood, MA 02090.
		

		
			 
		

		
			Whereas; Chasm and Liquidia entered into a Consulting Services and License Agreement on 31 August 2006 (the “Chasm Consulting Agreement”), which was mutually terminated by the parties as of the Effective Date; and
		

		
			 
		

		
			Whereas; the parties desire to now enter a manufacturing development and scale-up agreement whereby Chasm wishes to assist Liquidia in scale-up and optimization of Liquidia’s PRINT manufacturing capabilities.
		

		
			 
		

		
			In consideration of the mutual promises and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
		

		
			 
		

		
			1.            Definitions. Capitalized terms used in this Agreement shall have the meanings specified in this Agreement.  In addition, the following terms shall have the meanings below:
		

		
			 
		

		
			“Chasm Pre-Existing Intellectual Property” means Pre-Existing Intellectual Property owned or licensed by Chasm or its subcontractors.
		

		
			 
		

		
			“Deliverable” means any deliverable developed or prepared for Liquidia pursuant to this Agreement.
		

		
			 
		

		
			“Net Sales” means the worldwide gross receipts from sales to third parties of all Products, less all customary deductions actually paid using generally accepted accounting principles for i) trade, cash and quantity credits, discounts, refunds or rebates; ii) allowances or credits to customers actually granted on account of rejection, damage, or return of product; iii) sales commissions;  iv) sales and excise taxes (including value added tax) and any other governmental charges imposed upon the production, importation, use or sale of product; and v) transportation charges, including insurance, for transporting product to the extent specifically invoiced to the customer.
		

		
			 
		

		
			“Pre-Existing Intellectual Property” means the data, information, tools, ideas, techniques, methodologies, specifications, documentation, notes and materials, including any patents, patent rights, copyrights, mask works, trade secrets and other intellectual property rights embodied therein, owned or controlled by a party prior to or independent of Chasm’s performance under this Agreement, and whether or not used to produce, or embodied in, the Deliverables.
		

		
			 
		

		
			“Products” shall mean any particle or film fabricated in-whole or in-part under this Agreement.
		

		
			 
		

		
			 
		

		
			

		 

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			2.            Activities To Be Performed.
		

		
			 
		

		
			2.1          Activities.  Liquidia agrees to retain Chasm, and Chasm agrees to perform the services reasonably requested by Liquidia pursuant to the terms of this Agreement (the “Activities”).  The Activities are to be performed by Chasm personnel and, subject to the prior written consent of Liquidia, not to be unreasonably withheld, Chasm subcontractors, including, utilization of the resources and any Chasm Pre-Existing Intellectual Property necessary or useful to complete the Activities.
		

		
			 
		

		
			2.2          Use of Subcontractors.  Prior to entering into any subcontractor agreement, Chasm shall provide a copy, with the commercial terms redacted, of any such proposed subcontract to Liquidia and receive Liquidia’s prior written approval, which shall not be unreasonably withheld.  Any such agreement with subcontractors shall prohibit disclosure of Confidential Information and assign to Chasm all rights to any Liquidia Owned Intellectual Property developed by the subcontractor pursuant to this Agreement which Chasm shall thereafter assign to Liquidia as set forth in Sections 7.2, and require the subcontractor to license to Chasm all Subcontractor Pre-Existing Intellectual Property that is used in the Project or Deliverables which Chasm shall thereafter license to Liquidia in accordance with Sections 7.3a and 7.3b, as applicable.
		

		
			 
		

		
			2.3          Changes.  This Agreement and any appendix or attachment may be changed only by an agreement in writing signed by an authorized representative of both parties.
		

		
			 
		

		
			2.4          Cooperation.  Each party shall generally provide such cooperation as the other party reasonably requests regarding the Activities in accordance with customary business practices.  Unless otherwise expressly agreed and as otherwise set forth in this Agreement, such cooperation shall be provided without cost to the other party.
		

		
			 
		

		
			2.5          Ownership of Equipment and Supporting Documentation.  Liquidia shall own the entire right, title and interest to all equipment, machinery and supporting documents, plans and reports for the equipment and machinery created as a result of the performance of the Activities unless otherwise agreed to in writing.  All material and information protectable by copyright are “works made for hire,” as that term is defined in the 1976 Copyright Act as amended (title 17 of the United States Code).
		

		
			 
		

		
			3.            Compensation, Royalties and Expenses.   Liquidia’s payment obligations to Chasm are limited to those expressly defined in the following Sections 3.1, 3.2 and 3.3.
		

		
			 
		

		
			3.1          Compensation.  Liquidia agrees to pay Chasm for the Activities in accordance with the compensation schedule for the Activities in Appendix A.
		

		
			 
		

		
			3.2          Expenses.  Liquidia agrees to reimburse Chasm for reasonable and necessary travel and out-of-pocket expenses incurred in connection with the performance of the
		

		
			 
		

		
			
		

		
			

		 

		

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			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			Activities.  Reimbursement by Liquidia shall be made within thirty days (30) after submission by Chasm to Liquidia of expense reports, with copies of supporting documentation.
		

		
			 
		

		
			3.3          Royalties; Advanced Minimum Royalties.
		

		
			 
		

		
			3.3 a.      Advance Minimum Royalties.  Upon execution of this Agreement Liquidia shall pay Chasm equal monthly installments of $[***] beginning on the first full month after the Effective Date and continuing for the next consecutive twenty (20) months for a total of $[***] as partial consideration for entering into this Agreement with the significant obligations required of Chasm (“Partial Prepayment of Future Royalties”).  In addition, upon the first dosing of the first patient in the first Phase III clinical trial using a Product (“Phase III Initiation”), $400,000 shall become due to Chasm by Liquidia and payable by Liquidia to Chasm in equal monthly installments per month for the immediately following twelve (12) consecutive months.  Together the above Partial Prepayment of Future Royalties of $[***] and Phase III Initiation payment of $400,000 shall be defined as the “Advanced Minimum Royalties”, which shall apply as partial prepayment of future royalties and be credited against the Cumulative Royalties payable by Liquidia to Chasm hereunder.
		

		
			 
		

		
			3.3.b       Future Royalties.
		

		
			 
		

		
			3.3.b.1.  Liquidia shall pay to Chasm (i) a royalty of [***] percent ([***]%) of the Net Sales of all Products that incorporate, use, or result from using Liquidia Owned Intellectual Property (the “Sales Royalty”) and (ii) a royalty of [***] percent ([***]%) of all license fees and royalties received by Liquidia, from a party other than Chasm or its subcontractors, for each sublicense of Liquidia Owned Intellectual Property (the “License Fee”).
		

		
			 
		

		
			3.3.b.2  Notwithstanding the above, the License Fees in this Section 3.3.b shall not be triggered or become due for any sublicense in the context of research collaboration activities or licenses not related to commercialization activities.
		

		
			 
		

		
			3.3.c.  During the term of this Agreement, the total maximum amount of monies to be paid by Liquidia to Chasm under this Agreement (which amount includes the Advanced Minimum Royalties, Sales Royalty, and License Fee) shall be $[***] (“Cumulative Royalties”).  Upon Liquidia paying to Chasm the Cumulative Royalties, no further monies shall be due under this Agreement and the license grants in this Agreement shall become fully paid worldwide licenses according to their terms.  For clarity, the Advanced Minimum Royalties, Sales Royalty, and License Fee aggregate toward the Cumulative Royalties, however the Cumulative Royalties do not include consulting fees or other service related compensation paid by Liquidia to Chasm under this Agreement.
		

		
			 
		

		
			3.4          Payment Terms.  Liquidia shall pay each invoice set forth in the compensation schedule in Appendix A, in full, within thirty (30) days of Liquidia’s receipt of an accurate and reasonable invoice.  Any invoice payable by Liquidia which remains unpaid after the due date shall accrue interest at a rate of 1.0% per month.  Liquidia shall be liable for all collection expenses incurred by Chasm for delinquent amounts, including without limitation reasonable attorneys’ fees.
		

		
			 
		

		
			
		

		
			

		 

		

			3

		

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			3.5          Reports and Royalty Payments.  Commencing upon the commercialization of the first Product triggering royalties under this Agreement, within thirty (30) days following the last day of each calendar quarter during the term, Liquidia shall deliver to Chasm a written report showing, in reasonable detail, the royalties owed by such party to the other party in such quarter accompanied by any royalty payments due and owing.
		

		
			 
		

		
			3.6          Audit Rights.  Each party shall have the right to audit the relevant records of the other party upon reasonable notice and not more than once annually to verify compliance with the terms of this Agreement.  Fees and expenses incurred in connection with such audits will be borne by the auditing party, unless such audit reveals that an error of five percent (5%) or more and at least $2,500, in any payment was made during any given quarter, in which case the fees and expenses incurred in connection with the audit during which such error was discovered will be borne by audited party.  Any such audit shall occur during regular business hours, and shall not unreasonably interfere with regular business activities.
		

		
			 
		

		
			3.7          Records.  During the term of the Agreement and for three (3) years after royalties are due and payable, each party shall maintain true and complete books and records related to all royalty sales and applications.
		

		
			 
		

		
			4.            Work Rules.  Chasm and Chasm’s Representatives (as defined below) agree to comply with Liquidia’s applicable work rules and regulations of which Chasm is informed in writing, including any security requirements while on Liquidia premises.  Chasm and Chasm’s Representatives further agree to comply with all applicable governmental regulations and abide by Liquidia’s security requirements while on Liquidia premises.
		

		
			 
		

		
			Each party agrees that when its clients and Representatives are present on the premises of another party to this Agreement, they each shall comply with such rules and regulations as are notified to them for the conduct of individuals on those premises, and are subject to removal from the premises in the event they fail to comply with such rules.
		

		
			 
		

		
			Each party acknowledges and agrees that some of its employees, consultants, subcontractors or independent contractors will be performing work (the “Use Party”) on each other party’s (the “Location Owner”) properties, including laboratories.  Each party further acknowledges that the other parties perform work for other clients, including the U.S. Government, where security and confidentiality is an issue.  Therefore, the Use Party agrees that it will, if directed by a Location Owner on whose property it is performing work, instruct the Use Party’s staff, agents, officers, directors, employees, consultants, subcontractors or independent contractors (its “Representatives”) who work on the Location Owner’s property, to execute any additional confidentiality agreements or appropriate documents as are deemed reasonably necessary by the Location Owner.
		

		
			 
		

		
			5.            Representations, Warranties and Covenants.
		

		
			 
		

		
			5.1          Compliance with Other Agreements.  Chasm and Liquidia each represent to the other that to each Party’s knowledge the execution of this Agreement, the performance of
		

		
			 
		

		
			
		

		
			

		 

		

			4

		

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			the obligations hereunder, and the licenses granted herein do not and will not conflict with, result in the breach or termination of any provisions, or constitute a default under, any agreement to which Chasm or Liquidia, as the case may be, is or may be bound.
		

		
			 
		

		
			5.2          Necessary Licenses.  Chasm and Liquidia each represent and warrant to the other that to each Party’s knowledge each has all necessary licenses from subcontractors and licensors to perform the Activities, and to complete the Deliverables in accordance with this Agreement.
		

		
			 
		

		
			5.3          Limited Warranty.  Chasm represents and warrants that, to its knowledge and belief, (i) Chasm did not use or incorporate any proprietary subcontractor, or other third party, intellectual property into the deliverables generated and/or delivered to Liquidia under the Chasm Consulting Agreement; (ii) Liquidia has the freedom to practice the deliverables generated and/or delivered to Liquidia under the Chasm Consulting Agreement with respect to Chasm pre-existing intellectual property and any intellectual property Chasm developed under the Chasm Consulting Agreement; and (iii) Chasm has the skills and experience necessary to perform the Activities required under this Agreement and that it will use best efforts to the extent commercially reasonable, to perform said Activities in a professional, competent and timely manner.
		

		
			 
		

		
			5.4          Additional Representations, Warranties and Covenants.
		

		
			 
		

		
			5.4.1       All respective former and current employees and subcontractors of Chasm and Liquidia that have, have had, or will have access to confidential information have executed written agreements prohibiting disclosure of confidential information and assigning to each respective party, as applicable, all rights to any and all intellectual property, including inventions made during or derived from their relationship, to each respective party, as applicable.
		

		
			 
		

		
			5.4.2       Each Party has taken and will continue to take commercially reasonable precautions to protect the secrecy of its confidential information and trade secrets.
		

		
			 
		

		
			5.4.3       Neither Party has been alleged to infringe or misappropriate any intellectual property right of any other person or entity, there is no claim or action served or threatened, alleging any such infringement or misappropriation and neither party is aware of any such claim or action.
		

		
			 
		

		
			5.4.4       To the knowledge of the Parties, the operation of their respective businesses as presently conducted does not infringe or misappropriate any third-party intellectual property right.
		

		
			 
		

		
			5.4.5       Chasm represents that, to the best of its knowledge, neither it nor any of its personnel has been debarred, and to the best of its knowledge, is not under consideration to be debarred, by the U.S. Food and Drug Administration from working in or providing consulting services to any pharmaceutical or biotechnology company under the Generic Drug Enforcement Act of 1992.
		

		
			 
		

		
			
		

		
			

		 

		

			5

		

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			5.5          No Government Funding.  Chasm covenants that none of the Activities performed by Chasm or its subcontractors under this Agreement shall be funded in whole or in part by any government entity.
		

		
			 
		

		
			5.6          Additional Covenants.
		

		
			 
		

		
			5.6.1       Prior to incorporating into its Deliverables any third party intellectual property of which Chasm is aware and that Chasm reasonably believes the manufacture, use, sale, offer to sell, importation or other exploitation of which would require Liquidia to obtain a further license, Chasm shall identify such third party intellectual property to Liquidia.  Liquidia shall determine at its sole discretion and notify Chasm, within a commercially reasonably time, whether or not to incorporate such third party intellectual property into the Deliverable.  If Liquidia notifies Chasm to incorporate such third party intellectual property, Liquidia shall be responsible for procuring the necessary license that would permit such third party intellectual property to be used in the Project and the Deliverable.
		

		
			 
		

		
			5.6.2       At times reasonably requested by Liquidia, Chasm shall produce to Liquidia a comprehensive list of: a) agreements related to intellectual property of which Chasm is aware and reasonably believes affects or may affect the Activities and/or the use of the Deliverables; and b) all agreements between Chasm employees and their former employers or clients of which Chasm is aware, after a reasonable investigation, and reasonably believes is related to intellectual property that affects or may affect the Activities and/or the use of the Deliverables.  All such information and agreements transferred under this Agreement shall be treated as Chasm Confidential Information by Liquidia.
		

		
			 
		

		
			5.6.3       All future employees of Chasm, Chasm subcontractors, and Liquidia that will have access to Confidential Information will execute written agreements prohibiting disclosure of confidential information and assigning to each respective party, as applicable, all rights to any and all intellectual property, including inventions made during or derived from their relationship, to each respective party, as applicable.
		

		
			 
		

		
			5.7          Disclaimer.  EXCEPT AS OTHERWISE STATED IN SECTIONS 5.1, 5.2, 5.3, 5.4, 5.5 AND 5.6 NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES, OF ANY KIND OR NATURE, WHETHER EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE, TITLE OR NON-INFRINGEMENT.
		

		
			 
		

		
			6.            Confidentiality.
		

		
			 
		

		
			6.1          Each party acknowledges that in the course of this Agreement it will receive information about, and access to, trade secrets and other confidential and proprietary information which is vital to the competitive position and success of the other party to this Agreement.  The term “Confidential Information” as used throughout this Agreement shall mean with respect to a party, all proprietary information and technology of such party that is disclosed to the other party under this Agreement, whether disclosed in oral, written, graphic, or electronic form.  Notwithstanding the foregoing, all information and technology generated under this
		

		
			 
		

		
			
		

		
			

		 

		

			6

		

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			Agreement, whether generated by one or both parties shall be deemed the Confidential Information of the party that owns such information and technology under the terms of this Agreement.
		

		
			 
		

		
			Except as expressly provided herein, the parties agree that, under this Agreement and for ten (10) years thereafter, each party will keep completely confidential and will not publish or otherwise disclose or use any Confidential Information of the other party except in connection with the activities contemplated by this Agreement without such other party’s prior written consent, except for that portion of such information or materials that the receiving party can demonstrate by competent tangible proof:
		

		
			 
		

		
			(a)          was already known or available to the receiving party, other than under an obligation of confidentiality or non-use to the other party, at the time of disclosure to the receiving party;
		

		
			 
		

		
			(b)          was part of the public domain, at the time of its disclosure to the receiving party;
		

		
			 
		

		
			(c)          became part of the public domain, after its disclosure to the receiving party through no fault of or breach of its obligations under this Agreement by the receiving party;
		

		
			 
		

		
			(d)          was lawfully disclosed to the receiving party, other than under an obligation of confidentiality or non-use, by a third party rightfully in possession of the Confidential Information who had no obligation to the disclosing party not to disclose such information to others;
		

		
			 
		

		
			(e)          was independently discovered or developed by or for the receiving party without access to, use of, reference to, or reliance upon Confidential Information belonging to the disclosing party; or
		

		
			 
		

		
			(f)           is required to be disclosed pursuant to any applicable law, regulation, or legal order, provided that the receiving party has notified the disclosing party upon learning of the possibility that disclosure could be required pursuant to any such law, regulation, or legal order and has given the disclosing party a reasonable opportunity to contest or limit the scope of such required disclosure and has cooperated with the disclosing party toward this end.
		

		
			 
		

		
			Notwithstanding the above, specific aspects or details of Confidential Information will not be deemed to be within the public domain or in the prior possession of the receiving party merely because the aspects or details of the Confidential Information are embraced by general disclosures in the public domain.  In addition, any combination of Confidential Information will not be considered in the public domain or in the prior possession of the receiving party merely because individual elements thereof are in the public domain or in the prior possession of the receiving party unless the combination is in the public domain or in the prior possession of the receiving party.
		

		
			 
		

		
			Each of the parties agrees that it shall provide Confidential Information received from the other party only to the receiving party’s respective directors, officers, employees, agents, and financial and legal advisors who have a need to know such Confidential Information to assist the receiving party with the activities contemplated by this Agreement and are under written agreements of confidentiality at least as restrictive as those set forth in this Agreement.
		

		
			 
		

		
			6.2          Return of Confidential Information.  Upon expiration or early termination of this Agreement, each party shall return or destroy all Confidential Information received by it
		

		
			 
		

		
			
		

		
			

		 

		

			7

		

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			from the other party.  Notwithstanding the foregoing, each party shall be allowed to keep one (1) archival copy of any Confidential Information of the other party for record-keeping purposes only.
		

		
			 
		

		
			6.3          The Activities anticipated in this Agreement shall be performed by Representatives who may be retained by each party.  Any individual who assists in the performance of the Activities anticipated herein shall, prior to providing any such assistance, have executed an agreement with its employer or contracting party that is a signatory to this Agreement with terms no less restrictive than the terms of this Agreement.
		

		
			 
		

		
			7.            Intellectual Property Rights and Licenses
		

		
			 
		

		
			7.1          Each party shall own its Pre-Existing Intellectual Property.  Liquidia and/or Chasm or Chasm subcontractors from time to time may invent and/or create and/or develop and/or license or otherwise acquire rights and/or interests in intellectual property in performing the Activities, including rights and interests in any inventions (whether patentable or not), trade secrets, know how, and works of authorship fixed in any tangible medium of expression, known or later developed, from which they can be perceived, reproduced, or otherwise communicated, whether directly or with the aid of a machine or device (whether registerable or not) in connection with performing the Activities under this Agreement (“New Project IP”); provided that New Project IP shall not include any Pre-Existing Intellectual Property.
		

		
			 
		

		
			7.2          With respect to New Project IP, Liquidia and Chasm agree that all right, title and interest in New Project IP shall be owned by Liquidia (“Liquidia Owned Intellectual Property”).  Chasm agrees to assign and hereby does assign to Liquidia its entire right, title and interest to Liquidia Owned Intellectual Property including all of Chasms rights to bring suit and recover damages for past and future infringement.
		

		
			 
		

		
			7.3          a. Chasm grants Liquidia a perpetual, exclusive, sublicensable worldwide license, in accordance with the terms of this Agreement, to make, have made, use, offer to sell, sell, import, reproduce, prepare derivative works, and distribute Chasm Pre-Existing Intellectual Property solely as incorporated into the Activities and/or Deliverables for use or applications related to molded particles and harvested molded particles (the “Liquidia Permitted Exclusive Uses”).
		

		
			 
		

		
			b. Chasm grants Liquidia a perpetual, non-exclusive, sublicensable worldwide license, in accordance with the terms of this Agreement, to make, have made, use, offer to sell, sell, import, reproduce, prepare derivative works, and distribute Chasm Pre-Existing Intellectual Property solely as incorporated into the Activities and/or Deliverables for any use or application with Liquidia’s PRINT platform technology other than molded particles and harvested molded particles (the “Liquidia Permitted Non-exclusive Uses”).
		

		
			 
		

		
			7.4          All sublicenses shall include terms to protect the confidentiality of Chasm Pre-Existing Intellectual Property with terms at least as restrictive as this Agreement.
		

		
			 
		

		
			
		

		
			

		 

		

			8

		

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			7.5          Chasm may cause the exclusive license granted in Section 7.3 to Liquidia Permitted Exclusive Uses to become non-exclusive when (a) after the fourth anniversary of the Phase III Initiation if the cumulative of the Advanced Minimum Royalties, Sales Royalty and License Fee paid by Liquidia to Chasm have not exceeded $1,000,000 and Liquidia has failed to bring such cumulative total payment to Chasm to $1,000,000 after thirty (30) days written notice from Chasm and (b) after the eighth anniversary of the Phase III Initiation if Liquidia has not paid Chasm the Cumulative Royalties and Liquidia has failed to satisfy the Cumulative Royalties after thirty (30) days written notice from Chasm.
		

		
			 
		

		
			8.            Term and Termination.
		

		
			 
		

		
			8.1          Term.     This Agreement is in effect from the Effective Date until the Activities are completed and accepted by Liquidia unless terminated earlier.
		

		
			 
		

		
			8.2          Termination.
		

		
			 
		

		
			8.2.1       Material Breach.  Either party may, upon giving thirty (30) days written notice, terminate this Agreement for the other party’s breach of any of its material obligations under this Agreement, provided that the breaching party shall not have cured such breach within the thirty (30) day notice period.
		

		
			 
		

		
			8.2.2       Either party may terminate this Agreement for its convenience upon giving sixty (60) days prior written notice to the other party.
		

		
			 
		

		
			8.2.3       Mutual Termination.   The parties may agree to terminate this Agreement in a writing signed by both parties at any time prior to completion of the Activities.
		

		
			 
		

		
			8.3          Effect of Termination.
		

		
			 
		

		
			8.3.1       Upon termination of this Agreement, each party shall promptly return to the other party all Confidential Information of the other party and all equipment and products owned or controlled by the other party in its possession or under its control.
		

		
			 
		

		
			8.3.2       In the event of a material breach by Liquidia, all licenses granted to Liquidia shall terminate, provided Liquidia does not cure such breach within forty five (45) days following receipt of a detailed written notice of the breach by Chasm.
		

		
			 
		

		
			8.3.3       In the event of a material breach by Chasm, Liquidia shall pay Chasm for all reasonable out of pocket costs and expenses for Activities accepted through the termination date subject to a set-off by Liquidia of costs associated with Chasm’s material breach and all licenses granted to Liquidia hereunder shall survive.
		

		
			 
		

		
			8.3.4       Should Liquidia terminate this Agreement under Section 8.2.2 for convenience, all Liquidia Owned Intellectual Property created as of the date of termination shall remain the property of Liquidia, all license rights and obligations created under this Agreement
		

		
			 
		

		
			
		

		
			

		 

		

			9

		

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			as of the date of termination shall survive the termination and Liquidia shall pay Chasm (a) reasonable costs and expenses incurred by Chasm under this Agreement through the termination date, and (b) the Advanced Minimum Royalties under Section 3.3 a.
		

		
			 
		

		
			8.3.5       Should the parties terminate this Agreement under Section 8.2.3 for mutual convenience, all Liquidia Owned Intellectual Property created as of the date of termination shall remain the property of Liquidia, all license rights and obligations created under this Agreement as of the date of termination shall survive the termination and Liquidia shall pay Chasm reasonable costs and expenses incurred by Chasm under this Agreement through the termination date.
		

		
			 
		

		
			8.3.6       For the avoidance of doubt, the Parties acknowledge that Liquidia’s ownership rights with respect to Liquidia Owned Intellectual Property is and shall be irrevocable and unaffected by any expiration or termination of this Agreement for any reason.
		

		
			 
		

		
			8.4          Survival.  Sections 2.5, 3.3-3.7, 5, 6, 7, 8.3, 8.4, 9-15, and 18-19 shall survive the expiration or termination of this Agreement.
		

		
			 
		

		
			9.            Specific Performance.  Chasm and Liquidia each recognizes that irreparable injury may be caused to the other by its violation or material breach of Sections 6-7 of this Agreement, and Chasm and Liquidia each agrees that, in the event of any such violation, in addition to such other rights and remedies as may exist under this Agreement, the other may apply to any court of law or equity having jurisdiction to enforce the specific performance of the provisions hereof, and may apply for injunctive relief against any act which would violate any such provisions.
		

		
			 
		

		
			10.          Limitation on Liability.  TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, NEITHER PARTY SHALL BE LIABLE FOR ANY CONSEQUENTIAL, INCIDENTAL, PUNITIVE OR SPECIAL DAMAGES (INCLUDING LOSS OF PROFITS, DATA, BUSINESS OR GOODWILL), REGARDLESS OF WHETHER SUCH LIABILITY IS BASED ON BREACH OF CONTRACT, TORT, STRICT LIABILITY, BREACH OF WARRANTIES, FAILURE OF ESSENTIAL PURPOSE OR OTHERWISE, AND EVEN IF ADVISED OF THE LIKELIHOOD OF SUCH DAMAGES.  TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, THE LIABILITY OF CHASM FOR DIRECT DAMAGES, REGARDLESS OF WHETHER SUCH LIABILITY IS BASED ON BREACH OF CONTRACT, TORT, STRICT LIABILITY, BREACH OF WARRANTIES, FAILURE OF ESSENTIAL PURPOSE OR OTHERWISE, UNDER THIS AGREEMENT OR WITH RESPECT TO THE ACTIVITIES SHALL IN NO EVENT EXCEED THE AGGREGATE AMOUNT OF FEES WHICH CHASM RECEIVES IN CONNECTION WITH THIS AGREEMENT.  THESE LIMITATIONS ARE INDEPENDENT OF ALL OTHER PROVISIONS OF THIS AGREEMENT AND SHALL APPLY NOTWITHSTANDING THE FAILURE OF ANY REMEDY PROVIDED HEREIN.
		

		
			 
		

		
			11.          Independent Contractor.  Chasm and Liquidia agree that Chasm shall provide the Activities to Liquidia solely as an independent contractor.  This Agreement is not intended to and should not be deemed to create an employment or principal-agent relationship or joint venture between Chasm, or any of its employees or contractors, and Liquidia, and neither party shall
		

		
			 
		

		
			
		

		
			

		 

		

			10

		

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			have the right, power or authority to obligate, commit or incur any liability on behalf of the other party or to otherwise act in any way as an agent or representative of the other party or bind the other in any manner whatsoever.
		

		
			 
		

		
			12.          Bankruptcy.         The licenses granted in this Agreement (“Licenses”) are licenses for intellectual property, as such term is defined in Section 101 of Title 11 of the United States Code (the “Bankruptcy Code”).  The parties acknowledge and agree that, upon the filing of a petition for relief under the Bankruptcy Code by or against the Grantor (a “Filing”), whether such Filing is voluntary or involuntary, it is intended that this Agreement and the Licenses shall be subject to the provisions of Section 365(n) of the Bankruptcy Code, and, as such, the parties shall retain and may fully exercise all of its rights and elections provided thereunder.  In the event of a Filing, the parties shall, promptly upon written request by the other party, comply with the provisions of Section 365(n) of the Bankruptcy Code, including subsections (3) and (4) thereof.
		

		
			 
		

		
			13.          Severability.  In the event any provision of this Agreement, in whole or in part, is invalid, unenforceable or in conflict with the applicable laws or regulations of any jurisdiction, such provision will be replaced, to the extent possible, with a provision which accomplishes the original business purposes of the provision in a valid and enforceable manner, and the remainder of this Agreement will remain unaffected and in force provided, however, that if without such invalid or unenforceable provision the fundamental mutual objectives of the parties cannot be achieved, either party may terminate this Agreement without penalty by written notice to the other.
		

		
			 
		

		
			14.          Governing Law; Headings; Counterparts.  This Agreement shall be governed by and interpreted according to the laws of the State of Delaware without regard for any choice or conflict of laws rule or provision that would result in the application of the substantive law of any other jurisdiction.  The headings of the several sections are for convenience only and are not intended to be part of or to affect the meaning or interpretation of this Agreement.  This Agreement may be executed in counterparts (all of which counterparts shall constitute one and the same agreement) and may be executed by facsimile transmission.
		

		
			 
		

		
			15.          Assignment; Successors & Assigns. This Agreement and the rights and obligations hereunder may not be assigned in whole or in part by any party and any such assignment shall be null and void; provided, however, that an assignment may be made by any party to the surviving entity of a merger or acquisition of substantially all of the assets of such party.  This Agreement shall bind and inure to the benefit of all parties to this Agreement and their respective successors and permitted assigns.
		

		
			 
		

		
			16.          Force Majeure.  Neither party will be liable for any delays or failures in performance due to circumstances beyond its reasonable control.  In the event that either party is prevented from performing due to causes beyond its control, such party shall notify the other party, explaining the cause for same and the dates or times for performance shall be extended for the period of the delay and a reasonable additional time.
		

		
			 
		

		
			
		

		
			

		 

		

			11

		

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			17.          Entire Agreement; Waiver.  This Agreement together with the appendices and attachments thereto, sets forth the entire agreement between the parties concerning the transactions and arrangements contemplated hereby, and supersede all prior oral or written arrangements or agreements.  This Agreement may be amended only by an instrument in writing signed by both parties and may be waived only by an instrument in writing signed by the party against whom enforcement of the waiver is sought. The waiver by either party of any breach of this Agreement on one occasion shall not operate or be construed as a waiver of any other breach on another occasion.
		

		
			 
		

		
			18.          Remedies.  Except as expressly provided herein, the remedies provided in this Agreement are not and shall not be deemed to be exclusive and shall be in addition to any other remedies that a Party may have at law or in equity.
		

		
			 
		

		
			19.          Publicity.  Other than with respect to any internal reports or reporting to federal, state, and local authorities for purposes of compliance with legal reporting requirements (such as, for example, any appropriate reporting to the U.S. Securities & Exchange Commission), neither Party shall, without the express written consent of the other Party, use the name or mark of the other Party in transacting business or issue any public reports, statements, or releases pertaining to the transaction contemplated by this Agreement.
		

		
			 
		

		
			IN WITNESS WHEREOF, Liquidia and Chasm have duly executed this Agreement as of the Effective Date.
		

		
			 
		

			
					
						Chasm Technologies, Inc.

					
					
						 

					
					
						Liquidia Technologies, Inc.

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						By:

					
					
						/s/ Robert F. Praino

					
					
						 

					
					
						By:

					
					
						/s/ Bruce Boucher

				
	
					
						Name:

					
					
						Robert F. Praino

					
					
						 

					
					
						Name:

					
					
						Bruce Boucher

				
	
					
						Title:

					
					
						Co-Founder

					
					
						 

					
					
						Title:

					
					
						President & CFO

				

		
			 
		

		
			
		

		
			

		 

		

			12

		

 

		

		
			Confidential treatment has been requested with respect to portions of this agreement as indicated by “[***]” and such confidential portions have been deleted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.
		

		
			 
		

		
			APPENDIX A
		

		
			 
		

		
			COMPENSATION SCHEDULE
		

		
			 
		

		
			Components of cost:
		

		
			 
		

			
	
			
				 ·
			

			
	
			
			Consulting Activities rate will be $[***] per hour for the services of [***] and $[***] per hour for all others. It is expected that the workload related to this charge will be as needed as specified by Liquidia.

		
			 
		

			
	
			
				 ·
			

			
	
			
			Engineering rates (other subcontractors as required) will be based on the specific resource engaged (e.g. mechanical design, electrical design, third party analytical services, machine shops, etc.).

		
			 
		

			
	
			
				 ·
			

			
	
			
			Equipment enhancements or fabrication will be funded by Liquidia.

		
			 
		

			
	
			
				 ·
			

			
	
			
			Travel expenses for Chasm and/or sub-contractors will be pre-approved and funded by Liquidia.

		
			 
		

		
			 
		

		
			

		 

		

			13

		

 

		

		
			SEVENTH AMENDMENT TO LEASE AGREEMENT
		

		
			 
		

		
			THIS SEVENTH AMENDMENT TO LEASE AGREEMENT (this “Expansion Premises Amendment”) is entered into effective as of the 1st day of November, 2018 (the “Effective Date”), by and between DURHAM KTP TECH 4, LLC, a Delaware limited liability company (“Landlord”), and LIQUIDIA TECHNOLOGIES, INC., a Delaware corporation (“Tenant”), with reference to the following:
		

		
			 
		

		
			A.           GRE Keystone Technology Park One LLC (predecessor-in-interest to Landlord) (“GRE”) and Tenant entered into that certain Lease Agreement dated June 29, 2007, as amended by that certain Lease Modification Agreement No. 1 dated January 12, 2009, that certain Lease Modification Agreement No. 2 dated December 17, 2010, that certain Third Amendment to Lease Agreement dated June 25, 2014, that certain Fourth Amendment to Lease Agreement dated November 17, 2015 (the “Fourth Amendment”), that certain Fifth Amendment to Lease Agreement dated January 23, 2017 and that certain Sixth Amendment to Lease Agreement dated June 9, 2017 (collectively, as amended, the “Existing Lease”), covering approximately 36,831 rentable square feet known as Suite 100 on the first floor (the “Existing Premises”) of Keystone Technology Park Building IV, 419 Davis Drive, Durham, North Carolina, 27560 (the “Building”).
		

		
			 
		

		
			B.           GRE assigned its interest in the Lease to LCFRE Keystone Technology Park, L.P. which subsequently assigned its interest in the Lease to Landlord.
		

		
			 
		

		
			C.           Landlord and Tenant desire to amend the terms of the Existing Lease to expand the Existing Premises and to modify certain other terms of the Lease.  For purposes hereof, the Existing Lease as amended by this Expansion Premises Amendment is referred to as the “Lease.”  All capitalized terms not otherwise defined herein shall have the meanings set forth in the Existing Lease.
		

		
			 
		

		
			FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
		

		
			 
		

		
			1.            Recitals.  The recitals shall form a part of this Expansion Premises Amendment.
		

		
			 
		

		
			2.            Expansion of the Premises.  Tenant desires to expand the Existing Premises to include an additional eight thousand two hundred sixty-four (8,264) rentable square feet commonly known as Suite 200 located in the Building, as shown on Exhibit A attached hereto and incorporated herein by reference (the “Expansion Premises”).  Effective as of the Expansion Premises Rent Commencement Date (as defined in Section 4 of this Expansion Premises Amendment), the Existing Premises shall be expanded by adding the Expansion Premises and the term “Premises” under the Lease shall be redefined to be the Existing Premises plus the Expansion Premises, totaling approximately 45,095 rentable square feet of space (the “Revised Premises”).
		

		
			 
		

		
			3.            Lease Term;  Renewal Options.  Effective as of the Effective Date, the Term of the Lease for the Expansion Space (the “Expansion Premises Term”) shall be co-terminus with the Term of the Lease with respect to the Existing Premises, which shall expire on October 31, 2026, subject to Tenant’s options to extend the Term of the Lease pursuant to Section 5 of the Fourth Amendment which right shall apply to the entire Revised Premises.
		

		
			 
		

		
			4.            Base Rent.  Commencing as of the earlier of: (i) the date on which Tenant takes possession of any part of the Expansion Premises for the purposes of conducting business; or (ii) June 1, 2019 (the “Expansion Premises Rent Commencement Date”) and continuing through the Expansion Premises Term,
		

		
			 
		

		
			
		

		
			

		 

		

			1

		

 

		

		
			Tenant shall, at the time and in the manner provided in the Lease, pay to Landlord as Base Rent for the Revised Premises the amounts set forth in the following rent schedule, plus any applicable tax thereon:
		

		
			 
		

			
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						FROM

					
					
						    

					
					
						THROUGH

					
					
						    

					
					
						RATE

					
					
						    

					
					
						MONTHLY
BASE RENT

					
					
						    

					
					
						PERIOD
BASE RENT

					
					
						 

				
	
					
						Expansion Premises Rent Commencement Date

					
					
						 

					
					
						October 31, 2019

					
					
						 

					
					
						$

					
					
						24.98 

					
					
						 

					
					
						$

					
					
						93,872.76 

					
					
						 

					
					
						 

					
					
						TBD

					
					
						 

				
	
					
						November 1, 2019

					
					
						 

					
					
						October 31, 2020

					
					
						 

					
					
						$

					
					
						25.73 

					
					
						 

					
					
						$

					
					
						96,691.20 

					
					
						 

					
					
						$

					
					
						1,160,294.40 

					
					
						 

				
	
					
						November 1, 2020

					
					
						 

					
					
						October 31, 2021

					
					
						 

					
					
						$

					
					
						26.50 

					
					
						 

					
					
						$

					
					
						99,584.79 

					
					
						 

					
					
						$

					
					
						1,195,017.48 

					
					
						 

				
	
					
						November 1, 2021

					
					
						 

					
					
						October 31, 2022

					
					
						 

					
					
						$

					
					
						27.29 

					
					
						 

					
					
						$

					
					
						102,591.13 

					
					
						 

					
					
						$

					
					
						1,231,093.56 

					
					
						 

				
	
					
						November 1, 2022

					
					
						 

					
					
						October 31, 2023

					
					
						 

					
					
						$

					
					
						28.11 

					
					
						 

					
					
						$

					
					
						105,672.62 

					
					
						 

					
					
						$

					
					
						1,268,071.44 

					
					
						 

				
	
					
						November 1, 2023

					
					
						 

					
					
						October 31, 2024

					
					
						 

					
					
						$

					
					
						28.96 

					
					
						 

					
					
						$

					
					
						108,829.27 

					
					
						 

					
					
						$

					
					
						1,305,951.24 

					
					
						 

				
	
					
						November 1, 2024

					
					
						 

					
					
						October 31, 2025

					
					
						 

					
					
						$

					
					
						29.82 

					
					
						 

					
					
						$

					
					
						112,098.65 

					
					
						 

					
					
						$

					
					
						1,345,183.80 

					
					
						 

				
	
					
						November 1, 2025

					
					
						 

					
					
						October 31, 2026

					
					
						 

					
					
						$

					
					
						30.72 

					
					
						 

					
					
						$

					
					
						115,443.20 

					
					
						 

					
					
						$

					
					
						1,385,318.40 

					
					
						 

				

		
			 
		

		
			5.            Additional Rent.  Tenant shall continue to pay the TICAM Expense Adjustment for the Existing Premises as set forth in Section 4 of the Lease until the Expansion Premises Rent Commencement Date.  Commencing on the Expansion Premises Rent Commencement Date and continuing through the remainder of the Expansion Premises Term, Tenant shall pay the TICAM Expense Adjustment updated for the rentable square footage of the Revised Premises as set forth in Section 4 of the Lease.
		

		
			 
		

		
			6.            Delivery of Expansion Space.  Tenant shall accept the Expansion Space and all components thereof including, but not limited to, electrical and mechanical in its presently existing “as-is”, “where-is”, with all faults condition and Landlord shall not be obligated to provide or pay for any improvement work or services related to the improvement of the Expansion Space except as otherwise expressly set forth in the Tenant Work Letter attached hereto as Exhibit B and incorporated herein by reference.  Notwithstanding anything else contained in this Expansion Premises Amendment, Landlord shall ensure the presently existing HVAC units at the Expansion Premises are delivered in good working order. The acceptance of the Expansion Space in “as-is” condition shall in no way limit Landlord’s repair obligations set forth in the Lease.  The terms of the Existing Lease shall continue to control the construction obligations of the parties with regard to the Existing Premises.
		

		
			 
		

		
			7.            Early Access to Expansion Premises.  Commencing on the Effective Date, Tenant and its contractors shall have the right, at Tenant’s own risk and at no charge but subject to the terms and conditions of Section 6.1 of the Tenant Work Letter attached hereto as Exhibit B, to enter upon the Expansion Premises, to install its furniture, fixtures, and equipment (including Tenant’s data and telephone cabling and equipment) within the Expansion Premises.
		

		
			 
		

		
			8.            Broker.  Tenant represents and warrants that it has not been represented by any broker or agent in connection with the execution of this Expansion Premises Amendment, other than Foundry Commercial, as Tenant’s agent (“Tenant’s Broker”), which Tenant’s Broker shall be compensated pursuant to a separate written agreement.  Tenant shall indemnify and hold harmless Landlord and its designated property management, construction and marketing firms, and their respective partners, members, affiliates and subsidiaries, and all of their respective officers, directors, shareholders, employees, servants, partners, members, representatives, insurers and agents from and against all claims (including costs of defense and investigation) of any other broker or agent or similar party claiming by, through or under Tenant in connection with this Expansion Premises Amendment.  Landlord represents and warrants that it has not been represented by any broker or agent in connection with the execution of this Expansion Premises Amendment except Longfellow Real Estate Partners.  Landlord shall indemnify and hold harmless Tenant
		

		
			 
		

		
			
		

		
			

		 

		

			2

		

 

		

		
			and its partners, members, affiliates and subsidiaries, and all of their respective officers, directors, shareholders, employees, servants, partners, members, representatives, insurers and agents from and against all claims (including costs of defense and investigation) of any other broker or agent or similar party claiming by, through or under Landlord in connection with this Expansion Premises Amendment.
		

		
			 
		

		
			9.            Counterparts/Signatures.  This Expansion Premises Amendment may be executed in counterparts.  All executed counterparts shall constitute one agreement, and each counterpart shall be deemed an original.  The parties hereby acknowledge and agree that electronic signatures, facsimile signatures or signatures transmitted by electronic mail in so-called “pdf” format shall be legal and binding and shall have the same full force and effect as if an original of this Expansion Premises Amendment had been delivered.  Landlord and Tenant (i) intend to be bound by the signatures (whether original, faxed or electronic) on any document sent by facsimile or electronic mail, (ii) are aware that the other party will rely on such signatures, and (iii) hereby waive any defenses to the enforcement of the terms of this Expansion Premises Amendment based on the foregoing forms of signature.
		

		
			 
		

		
			10.          Miscellaneous.  This Expansion Premises Amendment shall become effective only upon full execution and delivery of this Expansion Premises Amendment by Landlord and Tenant.  This Expansion Premises Amendment contains the parties’ entire agreement regarding the subject matter covered by this Expansion Premises Amendment, and supersedes all prior correspondence, negotiations, and agreements, if any, whether oral or written, between the parties concerning such subject matter.  There are no contemporaneous oral agreements, and there are no representations or warranties between the parties not contained in this Expansion Premises Amendment.  Except as modified by this Expansion Premises Amendment, the terms and provisions of the Lease shall remain in full force and effect, and the Lease, as modified by this Expansion Premises Amendment, shall be binding upon and shall inure to the benefit of the parties hereto, their successors and permitted assigns.  To the extent of any conflict between the terms of this Expansion Premises Amendment and the Lease, this Expansion Premises Amendment shall control.
		

		
			 
		

		
			[Signatures to follow]
		

		
			 
		

		
			
		

		
			

		 

		

			3

		

 

		

		
			LANDLORD AND TENANT enter into this Expansion Premises Amendment as of the Effective Date specified below Landlord’s signature.
		

		
			 
		

			
					
						 

					
					
						LANDLORD:

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						DURHAM KTP TECH 4, LLC,

				
	
					
						 

					
					
						a Delaware limited liability company

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						By: 

					
					
						/s/ Jamison N. Peschel

				
	
					
						 

					
					
						Name:

					
					
						Jamison N. Peschel

				
	
					
						 

					
					
						Title:

					
					
						Authorized Signatory

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Effective Date: November 1, 2018

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						TENANT:

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						LIQUIDIA TECHNOLOGIES, INC.,

				
	
					
						 

					
					
						a Delaware corporation

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						/s/ Rob Lippe

				
	
					
						 

					
					
						Name:

					
					
						Rob Lippe

				
	
					
						 

					
					
						Title:

					
					
						COO

				

		
			 
		

		
			 
		

		
			

		 

		

			4

		

 

		

		
			EXHIBIT A
		

		
			 
		

		
			DEPICTION OF THE EXPANSION PREMISES
		

		
			 
		

		
			
		

		
			 
		

		
			KEYSTONE TECH 4
		

		
			 
		

		
			419 Davis Drive, Suite 200
		

		
			 
		

		
			8,264 RSF
		

		
			 
		

		
			

		 

		

			A-1

		

 

		

		
			EXHIBIT B
		

		
			 
		

		
			TENANT WORK LETTER
		

		
			 
		

		
			This Tenant Work Letter sets forth the terms and conditions relating to the construction of improvements in the Expansion Premises.  All references in this Tenant Work Letter to Articles or Sections of “this Expansion Premises Amendment” shall mean the relevant portion of the Expansion Premises Amendment to which this Tenant Work Letter is attached as Exhibit A and of which this Tenant Work Letter forms a part, and all references in this Tenant Work Letter to Sections of “this Tenant Work Letter” shall mean the relevant portion of this Tenant Work Letter.
		

		
			 
		

		
			1.            LANDLORD’S CONSTRUCTION IN THE EXPANSION PREMISES
		

		
			 
		

		
			1.1          Landlord Work.  None.
		

		
			 
		

		
			2.            TENANT IMPROVEMENTS
		

		
			 
		

		
			2.1          Tenant Improvements Allowance.  Tenant shall be entitled to a tenant improvement allowance (the “Tenant Improvements Allowance”) in the maximum aggregate amount of $950,360.00  (i.e.,  $115.00 per rentable square foot of the Expansion Premises) (the “Maximum Allowance Amount”) for the hard costs and customary soft costs incurred by Tenant including, without limitation out-of-pocket architectural and engineering fees and a one and one-half percent (1.5%) project management fee payable to Landlord or its affiliates and permits, relating to the design and construction of Tenant’s improvements which are to be permanently affixed to the Expansion Premises (the “Tenant Improvements”).  In no event shall Tenant be permitted to use any excess Tenant Improvements Allowance toward the Base Rent or any soft costs that are not directly related to the design and construction within the Expansion Premises.  In no event shall Landlord be obligated to make disbursements pursuant to this Tenant Work Letter in a total amount which exceeds the Maximum Allowance Amount.  All Tenant Improvements for which the Tenant Improvements Allowance has been made available shall be deemed Landlord’s property under the terms of the Lease.  Tenant must fully utilize the Tenant Improvements Allowance within twelve (12) months after the Effective Date of this Expansion Premises Amendment (such period to be extended by any delays caused by Landlord, its agents, employees, architects and/or contractors in the development and approval of the final space plan and/or the construction documents and/or delays in the submission and pursuit of permits and the construction of the Tenant Improvements, provided, however, Tenant shall notify Landlord in writing of the claimed estimated length of such Landlord delay within ten (10) business days after its occurrence and Landlord may elect by written notice delivered to Tenant within ten (10) business days thereafter to dispute the claimed estimated Landlord delay) and any amounts unutilized by such date shall be deemed forfeited by Tenant.
		

		
			 
		

		
			2.2          Disbursement of the Tenant Improvements Allowance.  Except as otherwise set forth in this Tenant Work Letter, the Tenant Improvements Allowance shall be disbursed by Landlord (each of which disbursements shall be made pursuant to Landlord’s reasonable disbursement process) for costs incurred by Tenant related to the construction of the Tenant Improvements and for the following items and costs (collectively, the “Tenant Improvements Allowance Items”):  (i) payment of the fees of the “Architect” as that term is defined in Section 3.1 of this Tenant Work Letter in connection with the preparation and review of the “Construction Documents,” as that term is defined in Section 3.1 of this Tenant Work Letter; (ii) payment of the project management fee described above, (iii) the cost of any changes to the Construction Documents or Tenant Improvements required by all applicable building codes (the “Code”) enacted after approval of the Construction Documents, (iv) costs payable to the Contractor and any subcontractors, and (v) other costs incurred in connection with the Tenant Improvements to the
		

		
			 
		

		
			
		

		
			

		 

		

			B-1

		

 

		

		
			extent the same can be paid using the Tenant Improvements Allowance pursuant to the specific provisions of this Tenant Work Letter.
		

		
			 
		

		
			Once Landlord is required to disburse any portion of the Tenant Improvement Allowance as noted above, Landlord shall disburse the applicable portion of the Tenant Improvements Allowance within thirty (30) calendar days of a Payment Request (as hereinafter defined), an amount equal to the portion of the actual costs and expenses Tenant has incurred and paid in connection with the construction of the Tenant Improvements to date, which are to be paid for from the Tenant Improvement Allowance provided the following conditions have been satisfied:
		

		
			 
		

		
			(1)          Tenant has delivered to Landlord a payment request (“Payment Request”) in a form reasonably satisfactory to Landlord specifying the work which has been completed; and
		

		
			 
		

		
			(2)          Tenant’s general contractor and/or architect shall have submitted an application for payment and sworn statement substantially in the form of AIA Document G702 and AIA Document G703; and
		

		
			 
		

		
			(3)          Tenant has submitted to Landlord lien waivers or partial lien waivers from all contractors, subcontractors, artchitects, and materialmen who performed such work to cover the work included under the Payment Request and all prior work Tenant was required to pay for before utilizing the Tenant Improvements Allowance.
		

		
			 
		

		
			Notwithstanding anything herein to the contrary, the Tenant Improvements Allowance must be requested by Tenant, if at all, in accordance with this paragraph on or before the date that is one (1) year following the Effective Date of this Expansion Premises Amendment, and any portion not requested by such date may no longer be utilized by Tenant and shall be deemed forfeited to Landlord.
		

		
			 
		

		
			3.            CONSTRUCTION DOCUMENTS
		

		
			 
		

		
			3.1          Selection of Architect/Construction Documents.  Tenant shall retain Integrated Designs, PA (collectively, the “Architect”) as subcontractors to prepare the “Construction Documents,” as that term is defined in this Section 3.1 for the Tenant Improvements, together with the consulting engineers selected by the Architect and reasonably approved by Landlord.  Tenant may retain another Architect or Architects from time to time, provided, however, that any such other Architects shall be subject to Landlord’s reasonable approval.  The plans and drawings to be prepared by Architect hereunder shall be known collectively as the “Construction Documents.”  All Construction Documents shall comply with the drawing format and specifications as determined by Landlord, and shall be subject to Landlord’s and Tenant’s approval.  Landlord may hire an architectural firm to conduct a peer review, and the fees associated with this peer review shall be paid from the Tenant Improvements Allowance.
		

		
			 
		

		
			Landlord has no obligation to approve any Tenant Change or any Tenant Improvements not shown on the plans previously approved by Landlord and Tenant or reasonably inferable therefrom if, in Landlord’s reasonable judgment, such Tenant Improvements (i) would materially increase the cost of performing any other work in the Building, unless in each case Tenant agrees to pay such costs based on Tenant’s Change Estimate Notice (as defined below), (ii) are incompatible with the design, quality, equipment or systems of the Building or otherwise require a change to the existing Building systems or structure, each in a manner that would not otherwise be required in connection with the improvements contemplated by the Fit Plan (as defined below), (iii) is not consistent the first class nature of the Building, or (iv) otherwise do not comply with the provisions of the Lease.
		

		
			 
		

		
			
		

		
			

		 

		

			B-2

		

 

		

		
			3.2          Final Space Plan.  Tenant has approved the preliminary space plan prepared by the Architect attached as Attachment 1 hereto (the “Fit Plan”).  Tenant shall use commercially reasonable efforts to cause the Architect to prepare a space plan for the Expansion Premises which space plan shall be reasonably consistent with the Fit Plan and shall include a layout and designation of all labs, offices, rooms and other partitioning, their intended use, and equipment to be contained therein, and shall deliver the space plan to Landlord and Tenant for their approval. Landlord shall review and provide any changes to the space plan within five (5) business days of receipt thereof.  Once Landlord and Tenant approve the final space plan, the space plan shall be considered final (the “Final Space Plan”).
		

		
			 
		

		
			3.3          Construction Documents.  Tenant shall cause the Architect to complete final Construction Documents consistent with the Final Space Plan and shall submit the same to Landlord and Tenant for their approval.  Landlord shall review and provide any changes to the construction documents within five (5) business days of receipt thereof, and the Tenant shall use reasonable efforts to cause the Architect to prepare and circulate modified documents within ten (10) business days of its receipt of any requested changes from Tenant or Landlord. Such process of submittal and response within the time frame specified in the preceding sentence shall continue until each of Landlord and Tenant gives written approval to such documents, and the Construction Documents shall be considered final once approved by the Landlord and the Tenant. In no event may either Tenant or Landlord require any changes that are inconsistent with the Final Space Plan.  The Construction Documents shall comply with applicable laws existing on the date of this Tenant Work Letter and which may be enacted prior to approval of completed Construction Documents. Subject to the provisions of Sections 3.1 and 5.4 of this Tenant Work Letter, Tenant may, from time to time, by written request to Landlord on a form reasonably specified by Landlord (“Tenant Change”), request a change in the Tenant Improvements shown on the Construction Documents, which approval shall not be unreasonably withheld or conditioned, and shall be granted or denied within five (5) business days after delivery of such Tenant Change to Landlord.
		

		
			 
		

		
			3.4          Permits.  The Construction Documents as approved (or deemed approved) pursuant to Section 3.3 shall be the “Approved Working Drawings”.  Following approval or deemed approval of the Cost Proposal, as described below, Tenant shall promptly thereafter submit or cause to be submitted, the Approved Working Drawings to the appropriate municipal authorities for all applicable building permits necessary to allow “Contractor,” as that term is defined in Section 4.1, below, to commence and fully complete the construction of the applicable Tenant Improvements (the “Permits”).
		

		
			 
		

		
			4.            CONSTRUCTION OF THE TENANT IMPROVEMENTS
		

		
			 
		

		
			4.1          Contractor.  A contractor designated by Tenant and approved by Landlord (“Contractor”) shall construct the Tenant Improvements.
		

		
			 
		

		
			4.2          Cost Proposal.  After the Approved Working Drawings are approved by Landlord and Tenant, Tenant shall provide Landlord with a cost proposal (or cost proposals) in accordance with the Approved Working Drawings, which cost proposal(s) shall include, as nearly as possible, the cost of all Tenant Improvements Allowance Items to be incurred by Tenant in connection with the design and construction of the Tenant Improvements and shall include a so-called guaranteed maximum price proposal from Tenant’s Contractor (collectively, the “Cost Proposal”), which Cost Proposal shall include, among other things, the Contractor’s fee, general conditions, and a reasonable contingency.  The Cost Proposal may include early trade release packages for long lead time matters such as mechanical equipment.  In connection with the Cost Proposal, Tenant shall cause the Contractor to solicit at least three (3) bids from each subcontractor trade for which the total cost is expected to exceed $10,000.00.  Landlord may review bid packages at Landlord’s request.  In the case of each bid request, Tenant will accept the lowest responsible bid, unless Landlord and Tenant reasonably determine otherwise.
		

		
			 
		

		
			
		

		
			

		 

		

			B-3

		

 

		

		
			4.3          Construction of Tenant Improvements by Contractor.
		

		
			 
		

		
			4.3.1       Intentionally Deleted.
		

		
			 
		

		
			4.3.2       Tenant’s Retention of Contractor.  Tenant shall independently retain Contractor to construct the Tenant Improvements in accordance with the applicable Approved Working Drawings and the applicable Cost Proposal.  Landlord shall be entitled to review the Tenant’s construction contract with the Contractor upon Landlord’s written request. Tenant shall manage the Contractor in its performance of the construction work and endeavor to oversee the Contractor’s performance of its work to protect Landlord from construction defects.
		

		
			 
		

		
			5.            COMPLETION OF THE TENANT IMPROVEMENTS
		

		
			 
		

		
			5.1          Substantial Completion.  Tenant shall give Landlord at least twenty (20) days prior written notice of the date that Tenant reasonably anticipates that the Tenant Improvements will be Substantially Complete (as defined below).  For purposes of this Lease, “Substantial Completion” shall occur upon the completion of construction of the Tenant Improvements substantially pursuant to the Approved Working Drawings for such Tenant Improvements (each as reasonably determined by Landlord), with the exception of any punch list items.
		

		
			 
		

		
			5.2          Intentionally omitted.
		

		
			 
		

		
			5.3          Intentionally omitted.
		

		
			 
		

		
			5.4          Tenant Changes.  Landlord may, but shall not be obligated to, approve any Tenant Change on the condition that Tenant shall pay in full, in advance (or cause to be paid in full from the Tenant Improvements Allowance), any and all additional costs or expenses associated with the approval of said Tenant Change.  If Tenant shall request any Tenant Change, Tenant shall provide Landlord in writing (a “Tenant’s Change Estimate Notice”) the estimated costs of design and/or construction of the Tenant Improvements that Tenant determines will be incurred as a consequence of such Tenant Change on an order of magnitude basis on account of such proposed Tenant Change.  The cost of any Tenant Change shall be determined on a net basis; i.e. taking into account the savings, if any, resulting from such Tenant Change.
		

		
			 
		

		
			5.5          Delay Not Caused by Parties.  Neither the Landlord nor Tenant shall be considered to be in default of the provisions of this Tenant Work Letter for delays in performance due to Force Majeure.
		

		
			 
		

		
			6.            MISCELLANEOUS
		

		
			 
		

		
			6.1          Tenant’s Entry Into the Expansion Premises.  Tenant shall comply with and perform, and shall cause its employees, agents, contractors, subcontractors, material suppliers and laborers to comply with and perform, all of Tenant’s insurance and indemnity obligations and other obligations governing the conduct of Tenant at the Property under this Lease.
		

		
			 
		

		
			Any independent contractor of Tenant (or any employee or agent of Tenant) performing any work or inspections in the Expansion Premises shall be subject to all of the terms, conditions and requirements contained in the Lease and, prior to such entry, Tenant shall provide Landlord with evidence of the insurance coverages required below.
		

		
			 
		

		
			6.2          Tenant’s Representative.  Tenant has designated Matt Carey and Michael Hunter as its sole representatives with respect to the matters set forth in this Tenant Work Letter, who, until further notice to
		

		
			 
		

		
			
		

		
			

		 

		

			B-4

		

 

		

		
			Landlord, shall have full authority and responsibility to act on behalf of the Tenant as required in this Tenant Work Letter.
		

		
			 
		

		
			6.3          Landlord’s Representative.  Landlord has designated J. Randal Long as its sole representative with respect to the matters set forth in this Tenant Work Letter, who, until further notice to Tenant, shall have full authority and responsibility to act on behalf of the Landlord as required in this Tenant Work Letter.
		

		
			 
		

		
			6.4          Intentionally omitted.
		

		
			 
		

		
			6.5          General.  This Tenant Work Letter shall not be deemed applicable to any additional space added to the Expansion Premises at any time or from time to time, whether by any options under the Lease or otherwise, or to any portion of the Premises or any additions to the Premises in the event of a renewal or extension of the original Lease Term, whether by any options under the Lease or otherwise, unless and to the extent expressly provided in the Lease or any amendment or supplement to the Lease that such additional space is to be delivered to Tenant in the same condition the initial Expansion Premises is to be delivered.
		

		
			 
		

		
			6.6          Insurance.  Prior to the commencement of the Tenant Improvements, Tenant shall provide Landlord with evidence that Tenant carries Builder’s All Risk insurance in an amount approved by Landlord covering the construction of such Tenant Improvements, and such other insurance as Landlord may reasonably require, it being understood and agreed that all of such Tenant Improvements shall be insured by Tenant pursuant to the Lease immediately upon completion thereof.  In addition, Tenant’s contractors, subcontractors, and architects shall be required to carry Commercial General Liability Insurance in an amount approved by Landlord and otherwise in accordance with the requirements of the Lease and such general liability insurance shall name the Landlord as additional insured. Landlord may, in its discretion, require Tenant to obtain and record a statutory form of lien bond, or obtain performance and payment bonds, or some alternate form of security satisfactory to Landlord in an amount sufficient to ensure the lien-free completion of such Tenant Improvements and naming Landlord as a co-obligee, in each case in form and substance reasonably satisfactory to Landlord. In addition, Tenant’s contractors and subcontractors shall be required to carry workers compensation insurance with a waiver of subrogation in favor of Landlord.
		

		
			 
		

		
			
		

		
			

		 

		

			B-5

		

 

		

		
			Attachment 1
		

		
			 
		

		
			Tenant’s Fit Plan
		

		
			 
		

		
			
		

		
			 
		

		 

		

			B-6

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