Document:

Document

Option Care Health, Inc. 
2018 Equity Incentive Plan

Amended and Restated as of May 19, 2021

TABLE OF CONTENTS
SECTION 1. BACKGROUND AND PURPOSE...........................................................................    1
SECTION 2. DEFINITIONS..........................................................................................................    1
2.1.Affiliate.........................................................................................................................    1
2.2.Award............................................................................................................................    1
2.3.Award Agreement.........................................................................................................    1
2.4.Board.............................................................................................................................    1
2.5.Change in Control.........................................................................................................    1
2.6.Code..............................................................................................................................    3
2.7.Committee.....................................................................................................................    3
2.8.Covered Officer.............................................................................................................    3
2.9.Director..........................................................................................................................    3
2.10.Ending Value.................................................................................................................    3
2.11.Fair Market Value.........................................................................................................    3
2.12.ISO................................................................................................................................    3
2.13.Key Employee...............................................................................................................    4
2.14    1933 Act........................................................................................................................    4
2.15    1934 Act........................................................................................................................    4
2.16.Non-ISO........................................................................................................................    4
2.17.Option............................................................................................................................    4
2.18.Option Certificate..........................................................................................................    4
2.19.Option Price...................................................................................................................    4
2.20.Parent.............................................................................................................................    4
2.21.Performance Goal..........................................................................................................    4
2.22.Performance Period.......................................................................................................    4
2.23.Performance Unit...........................................................................................................    4
2.24.Plan................................................................................................................................    4
2.25.Prior Plan.......................................................................................................................    4
2.26.Restricted Stock Unit.....................................................................................................    4
2.27.Restricted Stock Unit Certificate...................................................................................    4
2.28    Rule 16b-3......................................................................................................................    4
2.29.SAR Value.....................................................................................................................    4
2.30.Stock..............................................................................................................................    4
2.31.Stock Appreciation Right...............................................................................................    4
2.32.Stock Appreciation Right Certificate............................................................................    5
2.33.Stock Grant....................................................................................................................    5
2.34.Stock Grant Certificate..................................................................................................    5
2.35.Subsidiary......................................................................................................................    5
2.36.Substitute Awards..........................................................................................................    5
2.37.Ten Percent Shareholder................................................................................................    5
SECTION 3. SHARES RESERVED UNDER PLAN....................................................................    5
3.1.Number of Shares..........................................................................................................    5
3.2.Character of Shares........................................................................................................    6
i

SECTION 4. EFFECTIVE DATE..................................................................................................    6
SECTION 5. COMMITTEE...........................................................................................................    7
5.1.Committee Powers.........................................................................................................    7
5.2.Committee Decisions and Meetings..............................................................................    7
5.3.Delegation......................................................................................................................    7
SECTION 6. ELIGIBILITY, ANNUAL GRANT CAPS AND DEFAULT VESTING................    8
6.1.Eligibility, Annual Grant Caps......................................................................................    8
6.2.Default Vesting..............................................................................................................    8
SECTION 7. OPTIONS..................................................................................................................    8
7.1    Committee Action..........................................................................................................    8
7.2    $100,000 Limit..............................................................................................................    8
7.3.Option Price...................................................................................................................    8
7.4.Payment.........................................................................................................................    9
7.5.Exercise Period..............................................................................................................    9
7.6.Reload Option Grants, Dividends Prohibited................................................................    9
SECTION 8. STOCK APPRECIATION RIGHTS.........................................................................    9
8.1.Committee Action.........................................................................................................    9
8.2.Terms and Conditions..................................................................................................    10
8.3.Exercise.......................................................................................................................    10
SECTION 9. RESTRICTED STOCK UNITS..............................................................................    11
9.1.Committee Action.......................................................................................................    11
9.2.No Adjustment for Cash Dividends............................................................................    11
9.3.Payment for Restricted Stock Units............................................................................    11
9.4.Deferrals......................................................................................................................    11
9.5.Performance-Based Vesting........................................................................................    12
SECTION 10. STOCK GRANTS.................................................................................................    12
10.1.Committee Action.......................................................................................................    12
10.2.Conditions...................................................................................................................    12
10.3.Dividends and Voting Rights......................................................................................    13
10.4.Satisfaction of Forfeiture Conditions..........................................................................    13
10.5.Performance-Based Vesting........................................................................................    13
SECTION 11. PERFORMANCE UNITS.....................................................................................    13
11.1.Committee Action.......................................................................................................    13
11.2.Conditions...................................................................................................................    13
11.3.Performance Goals......................................................................................................    13
11.4.Performance Period.....................................................................................................    14
11.5.Payment for Performance Units..................................................................................    15
SECTION 12. DIRECTOR AWARDS.........................................................................................    15
12.1.Awards.........................................................................................................................    15
12.2.Applicable Limit..........................................................................................................    15

ii

SECTION 13. NON-TRANSFERABILITY.................................................................................    15
SECTION 14. SECURITIES REGISTRATION..........................................................................    16
SECTION 15. LIFE OF PLAN.....................................................................................................    16
SECTION 16. ADJUSTMENT.....................................................................................................    16
16.1.Capital Structure..........................................................................................................    16
16.2.Mergers........................................................................................................................    17
16.3.Fractional Shares.........................................................................................................    17
SECTION 17. CHANGE IN CONTROL.....................................................................................    17
17.1.Assumption or Substitution of Certain Awards..........................................................    17
17.2.Non-Assumption or Substitution of Certain Awards..................................................    18
17.3.Impact on Certain Awards...........................................................................................    18
SECTION 18. AMENDMENT OR TERMINATION..................................................................    18
SECTION 19. MISCELLANEOUS..............................................................................................    19
19.1.Stockholder Rights......................................................................................................    19
19.2.No Contract of Employment or Service......................................................................    19
19.3.Withholding.................................................................................................................    19
19.4.Construction................................................................................................................    20
19.5.Other Laws..................................................................................................................    20
19.6.Compliance with Section 409A of the Code..............................................................    20
19.7.Award Agreements.....................................................................................................    20
19.8.No Limit on Other Compensation Arrangements......................................................    21
19.9.Severability.................................................................................................................    21
19.10.Awards to Non-U.S. Participants................................................................................    21
19.11.Company Clawback Policy.........................................................................................    21
19.12.No Trust or Fund Created...........................................................................................    21
19.13.Headings.....................................................................................................................    22

iii

SECTION 1.
BACKGROUND AND PURPOSE

The purpose of this Plan is to promote the interest of Option Care Health, Inc. (the “Company”), a Delaware corporation, by authorizing the Committee to grant Awards to Key Employees and Directors in order (1) to attract and retain Key Employees and Directors, (2) to provide an additional incentive to each Key Employee and Director to work to increase the value of Stock and (3) to provide each Key Employee and Director with a stake in the future of the Company which corresponds to the stake of each of the Company’s stockholders.

SECTION 2. DEFINITIONS

2.1.Affiliate — means any organization (other than a Subsidiary) that would be treated as under common control with the Company under § 414(c) of the Code if “50 percent” were substituted for “80 percent” in the income tax regulations under § 414(c) of the Code.

2.2.Award — means any Option, Stock Appreciation Right, Restricted Stock Unit, Stock Grant or Performance Unit made pursuant to the provisions of the Plan.

2.3.Award Agreement — means any Option Certificate, Restricted Stock Unit Certificate, Stock Appreciation Right Certificate, or Stock Grant Certificate.

2.4.Board — means the Board of Directors of the Company.

2.5.Change in Control — means unless otherwise provided in an Award Agreement, the occurrence of any one of the following events:

(a)During any twenty-four (24) month period, individuals who, as of the beginning of such period, constitute the Board (the “Incumbent Directors”) cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director subsequent to the beginning of such period whose election or nomination for election was approved by a vote of at least a majority of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without written objection to such nomination) shall be an Incumbent Director; provided, however, that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest with respect to directors or as a result of any other actual or threatened solicitation of proxies by or on behalf of any person other than the Board shall be deemed to be an Incumbent Director;

(b)Any “person” or “group” (within the meaning of Sections 13(d) and 14(d) of the Securities Exchange Act of 1934 (the “Exchange Act”)) is or becomes a “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 50% or more of the combined voting power of the Company’s then outstanding securities eligible to vote for the election of the Board (the “Company Voting Securities”); provided, however, that the event described in this paragraph  (b) shall  not  be deemed to  be a Change in  Control  by virtue  of any of   the

following acquisitions: (i) by the Company or any Affiliate or Subsidiary, (ii) by any employee benefit plan (or related trust) sponsored or maintained by the Company or any Affiliate or Subsidiary, (iii) by any underwriter temporarily holding securities pursuant to an offering of such securities, (iv) pursuant to a Non-Qualifying Transaction, as defined in paragraph (c), or (v) by any person of or group of Voting Securities from the Company, if a majority of the Incumbent Board approves in advance the acquisition of beneficial ownership of 50% or more of Company Voting Securities by such person or group;

(c)The consummation of a merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company or any of its subsidiaries that requires the approval of the Company’s stockholders, whether for such transaction or the issuance of securities in the transaction (a “Business Combination”), unless immediately following such Business Combination: (i) more than 50% of the total voting power of (A) the corporation resulting from such Business Combination (the “Surviving Corporation”), or (B) if applicable, the ultimate parent corporation that directly or indirectly has beneficial ownership of 100% of the voting securities eligible to elect directors of the Surviving Corporation (the “Parent Corporation”), is represented by Company Voting Securities that were outstanding immediately prior to such Business Combination (or, if applicable, is represented by shares into which such Company Voting Securities were converted pursuant to such Business Combination), and such voting power among the holders thereof is in substantially the same proportion as the voting power of such Company Voting Securities among the holders thereof immediately prior to the Business Combination, (ii) no person (other than any employee benefit plan (or related trust) sponsored or maintained by the Surviving Corporation or the Parent Corporation), is or becomes the beneficial owner, directly or indirectly, of 30% or more of the total voting power of the outstanding voting securities eligible to elect directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation) and (iii) at least a majority of the members of the board of directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation) following the consummation of the Business Combination were Incumbent Directors at the time of the Board’s approval of the execution of the initial agreement providing for such Business Combination (any Business Combination which satisfies all of the criteria specified in (i), (ii) and (iii) above shall be deemed to be a “Non- Qualifying Transaction”);

(d)The stockholders of the Company approve a plan of complete liquidation or dissolution of the Company;

(e)The consummation of a sale of all or substantially all of the Company’s
assets.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any person acquires beneficial ownership of more than 50% of the Company Voting Securities as a result of the acquisition of Company Voting Securities by the Company which reduces the number of Company Voting Securities outstanding; provided, that if after such acquisition by the Company such person becomes the beneficial owner of additional Company Voting Securities that increases the percentage of outstanding Company Voting Securities beneficially owned by such person, a Change in Control of the Company shall then occur.
2

Unless otherwise provided in an applicable Award Agreement, solely for the purpose of determining the timing of any payments pursuant to any Awards constituting a “deferral of compensation” subject to Section 409A of the Code, (i) a Change in Control shall be limited to a “change in the ownership of the Company,” a “change in the effective control of the Company,” or a “change in the ownership of a substantial portion of the assets of the Company” as such terms are defined in Section 1.409A-3(i)(5) of the U.S. Treasury Regulations. No Award Agreement shall define a Change in Control in such a manner that a Change in Control would be deemed to occur prior to the actual consummation of the event or transaction that results in a change of control of the Company (e.g., upon the announcement, commencement, or stockholder approval of any event or transaction that, if completed, would result in a change in control of the Company).

2.6.Code — means the Internal Revenue Code of 1986, as amended.

2.7.Committee — means the Management Development & Compensation Committee, or such other committee appointed by the Board, which shall have at least 2 members, each of whom shall come within the definition of a “non-employee director” under Rule 16b-3 and an “outside director” under § 162(m) of the Code.

2.8.Covered Officer — means at any date (i) any individual who, with respect to the previous taxable year of the Company, was a “covered employee” of the Company within the meaning of Section 162(m) of the Code as it existed prior to being amended by Public Law No: 115-97 (the Tax Cuts and Jobs Act); provided, however, that the term “Covered Officer” shall not include any such individual who is designated by the Committee, in its discretion, at the time of any Award or at any subsequent time, as reasonably expected not to be such a “covered employee” with respect to the current taxable year of the Company or the taxable year of the Company in which the applicable Award will be paid or vested, and (ii) any individual who is designated by the Committee, in its discretion, at the time of any Award or at any subsequent time, as reasonably expected to be such a “covered employee” with respect to the current taxable year of the Company or with respect to the taxable year of the Company in which any applicable Award will be paid or vested.

2.9.Director — means a non-employee member of the Board.

2.10.Ending Value — means, a value for each Performance Unit or a formula for determining the value of each Performance Unit at the time of payment.

2.11.Fair Market Value — means (1) the closing price on any date for a share of Stock on the principal securities exchange on which the Stock is traded or listed or, if no such closing price is available on such date, (2) such closing price as so reported in accordance with clause (1) for the immediately preceding business day, or, if the Stock is not traded or listed on any securities exchange, (3) the price which the Committee acting in good faith determines through any reasonable valuation method that a share of Stock might change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of the relevant facts.

2.12.ISO — means an Option which is intended to satisfy the requirements of § 422 of the Code.

3

2.13.Key Employee — means an employee of the Company or any Subsidiary or Parent or Affiliate designated by the Committee who, in the judgment of the Committee acting in its absolute discretion, is key directly or indirectly to the success of the Company.

2.14.1933 Act — means the Securities Act of 1933, as amended.

2.15.1934 Act — means the Securities Exchange Act of 1934, as amended.

2.16.Non-ISO — means an Option which is not intended to satisfy the requirements of
§ 422 of the Code.

2.17.Option — means an option to purchase Stock which is granted under § 7.

2.18.Option Certificate — means the written certificate which sets forth the terms and conditions of an Option granted under this Plan.

2.19.Option Price — means the price which shall be paid to purchase one share of Stock upon the exercise of an Option granted under this Plan.

2.20.Parent — means any corporation which is a parent corporation (within the meaning of § 424(e) of the Code) of the Company.

2.21.Performance Goal — means a performance goal described in § 11.3.

2.22.Performance Period — means a performance period as described in § 11.4.

2.23.Performance Unit — means an Award granted under § 11.

2.24.Plan — means this Option Care Health, Inc. 2018 Equity Incentive Plan as adopted by the Board and as amended from time to time thereafter.

2.25.Prior Plan — means the Company’s 2008 Incentive Stock Plan, as the same was amended and/or restated from time to time.

2.26.Restricted Stock Unit — means an Award granted under § 9.

2.27.Restricted Stock Unit Certificate — means the written certificate which sets forth the terms and conditions of a Restricted Stock Unit.

2.28.Rule 16b-3 — means the exemption under Rule 16b-3 to Section 16(b) of the 1934 Act or any successor to such rule.

2.29.SAR Value — means the value assigned by the Committee to a share of Stock in connection with the grant of a Stock Appreciation Right under § 8.

2.30.Stock — means the common stock, $.0001 par value per share, of the Company.

2.31.Stock Appreciation Right — means a right to receive the appreciation in a share of Stock which is granted under § 8.
4

2.32.Stock Appreciation Right Certificate — means the written certificate which sets forth the terms and conditions of a Stock Appreciation Right which is not granted to a Key Employee as part of an Option.

2.33.Stock Grant — means Stock granted under § 10.

2.34.Stock Grant Certificate — means the written certificate which sets forth the terms and conditions of a Stock Grant.

2.35.Subsidiary — means a corporation which is a subsidiary corporation (within the meaning of § 424(f) of the Code) of the Company.

2.36.Substitute Awards — Awards granted or shares of Stock issued by the Company in assumption of, or in substitution or exchange for, awards previously granted, or the right or obligation to make future awards, in each case by a company acquired by the Company or any Affiliate or Subsidiary or with which the Company or any Affiliate or Subsidiary combines.

2.37.Ten Percent Shareholder — means a person who owns (after taking into account the attribution rules of § 424(d) of the Code) more than ten percent of the total combined voting power of all classes of stock of either the Company, a Subsidiary or Parent.

SECTION 3.
SHARES RESERVED UNDER PLAN

3.1.Number of Shares

(a)Subject to adjustment as provided in § 16, a total of 9,101,734 shares of Stock shall be authorized for issuance under the Plan, all of which may be subject to ISOs, less one (1) share of Stock for every one (1) share of Stock that was subject to an Option or Stock Appreciation Right granted after December 31, 2017 under the Prior Plan and one and 18/100 (1.18) shares of Stock for every one (1) share of Stock that was subject to an Award other than an Option or Stock Appreciation Right granted after December 31, 2017 under the Prior Plan. Any shares of Stock that are subject to Awards of Options or Stock Appreciation Rights shall be counted against this limit as one (1) share of Stock for every one (1) share of Stock issued. Any shares of Stock that are subject to Awards other than Options or Stock Appreciation Rights shall be counted against this limit as one and 18/100 (1.18) shares of Stock for every one (1) share of Stock issued. As of the Effective Date, no further grants or awards will be made under the Prior Plan.

(b)If any shares of Stock subject to an Award, or after December 31, 2017 an award under the Prior Plan, are forfeited or expire, or any Award, or after December 31, 2017 an award under the Prior Plan, is settled for cash (in whole or in part), the shares of Stock subject to such Award or such award under the Prior Plan shall, to the extent of such forfeiture, expiration or cash settlement, again be available for Awards under the Plan, in accordance with § 3.1(d) below. Notwithstanding anything to the contrary contained herein, the following shares of Stock shall not be added to the shares of Stock authorized for issuance under paragraph (a) of this Section: (i) shares of Stock tendered 

5

by the Key Employee or Director or withheld by the Company in payment of the purchase price of an Option, (ii) shares of Stock tendered by the Key Employee or withheld by the Company to satisfy any tax withholding obligation with respect to an Award, and (iii) shares of Stock subject to a Stock Appreciation Right that are not issued in connection with the stock settlement of the Stock Appreciation Right on exercise thereof.

(c)Substitute Awards shall not reduce the shares of Stock authorized for issuance under the Plan or authorized for grant to a Participant under § 6. Additionally, in the event that a company acquired by the Company or any Affiliate or Subsidiary or with which the Company or any Affiliate or Subsidiary combines has shares available under a pre-existing plan approved by stockholders and not adopted in contemplation of such acquisition or combination, the shares available for issuance pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of common stock of the entities party to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the shares of Stock authorized for issuance under the Plan; provided that Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not employees or directors of the Company, an Affiliate or a Subsidiary prior to such acquisition or combination.

(d)Any shares of Stock that again become available for issuance pursuant to this § 3 shall be added back as one (1) share of Stock if such shares of Stock were subject to Options or Stock Appreciation Rights granted under the Plan or options or stock appreciation rights granted under the Prior Plan, and as one and 18/100 (1.18) shares of Stock if such shares of Stock were subject to Awards other than Options or Stock Appreciation Rights granted under the Plan or awards other than options or stock appreciation rights granted under the Prior Plan.

3.2.Character of Shares. Any Shares issued hereunder may consist, in whole or in part, of authorized and unissued shares, treasury shares or shares purchased in the open market or otherwise.

SECTION 4.
EFFECTIVE DATE

The effective date of this Plan shall be the date of its approval by the shareholders of the Company at a duly called meeting (the “Effective Date”).
6

SECTION 5. COMMITTEE

5.1.Committee Powers. This Plan shall be administered by the Committee. The Committee shall have full power and authority, subject to the provisions of the Plan and subject to such orders or resolutions not inconsistent with the provisions of the Plan as may from time to time be adopted by the Board, to: (i) select the Key Employees and Directors to whom Awards may from time to time be granted hereunder; (ii) determine the type or types of Awards, not inconsistent with the provisions of the Plan, to be granted to each Participant hereunder; (iii) determine the number of shares of Stock to be covered by each Award granted hereunder; (iv) determine the terms and conditions, not inconsistent with the provisions of the Plan, of any Award granted hereunder; (v) determine whether, to what extent and under what circumstances Awards may be settled in cash, shares of Stock or other property; (vi) determine whether, to what extent, and under what circumstances cash, shares of Stock, other property and other amounts payable with respect to an Award made under the Plan shall be deferred either automatically or at the election of the Key Employee or Director; (vii) determine whether, to what extent and under what circumstances any Award shall be canceled or suspended; (viii) interpret and administer the Plan and any instrument or agreement entered into under or in connection with the Plan, including any Award Agreement; (ix) correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Award in the manner and to the extent that the Committee shall deem desirable to carry it into effect; (x) establish such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; (xi) determine whether any Award, other than an Option or Stock Appreciation Right, will have dividend equivalents; and (xii) make any other determination and take any other action that the Committee deems necessary or desirable for administration of the Plan. The Committee shall have the full power and authority to determine the terms and conditions that shall apply to any Award upon a separation from service with the Company, its Subsidiaries and Affiliates, including a separation from the Company with or without Cause, by a Participant voluntarily, or by reason of death, disability, or retirement, and may provide such terms and conditions in the Award Agreement or in such rules and regulations as it may prescribe.

5.2.Committee Decisions and Meetings. Decisions of the Committee shall be final, conclusive and binding on all persons or entities, including the Company, any Affiliate or Subsidiary, and any Participant employed by any of the foregoing. A majority of the members of the Committee may determine its actions, including fixing the time and place of its meetings. Notwithstanding the foregoing, any action or determination by the Committee specifically affecting or relating to an Award to a Director shall require the prior approval of the Board.

5.3.Delegation. To the extent not inconsistent with applicable law, including Section 162(m) of the Code, or the rules and regulations of the principal securities exchange on which the Stock is traded or listed, the Committee may delegate, by means of an express resolution that sets forth the requirements and limitations relating to the delegation and the procedures to be followed to grant any Awards, to (i) a committee of one or more directors of the Company any of the authority of the Committee under the Plan, including the right to grant, cancel or suspend Awards and (ii) to the extent permitted by law, to one or more executive officers or a committee of executive officers the right to grant Awards to Key Employees who are not Directors or executive officers of the Company and the authority to take action on behalf of the Committee 

7

pursuant to the Plan to cancel or suspend Awards to Key Employees who are not Directors or executive officers of the Company.

SECTION 6.
ELIGIBILITY, ANNUAL GRANT CAPS AND DEFAULT VESTING

6.1.Eligibility, Annual Grant Caps. Any Key Employee or Director shall be eligible to be designated a Participant; provided, however, that Directors shall only be eligible to receive Awards granted consistent with § 12. Only Key Employees who are employed by the Company or a Subsidiary or Parent shall be eligible for the grant of ISOs under this Plan. No Key Employee in any calendar year shall be granted more than 750,000 shares of Stock (subject to adjustment under § 16) with respect to the following (i) Options to purchase shares of Stock, (ii) Stock Appreciation Rights (based on the appreciation with respect to shares of Stock); and (iii) Stock Grants and Restricted Stock Units that are intended to comply with the requirements of § 11 of the Plan.

6.2.Default Vesting. Except as otherwise provided below, any Award that: (a) is not a Performance Unit Award shall have a minimum vesting period of one year from the date of grant (a “Minimum Vesting Period”); or (b) is a Performance Unit Award shall have a minimum performance period of one year from the date of grant (a “Minimum Performance Period”). The foregoing notwithstanding, five percent (5%) of the total number of Shares available for issuance under this Plan may be granted without regard to any Minimum Vesting Period or Minimum Performance Period, as applicable, described in this § 6.2.

SECTION 7. OPTIONS

7.1.Committee Action. The Committee acting in its absolute discretion shall have the right to grant Options to Key Employees and Directors under this Plan from time to time to purchase shares of Stock. Each grant of an Option shall be evidenced by an Option Certificate, and each Option Certificate shall set forth whether the Option is an ISO or a Non-ISO and shall set forth such other terms and conditions of such grant as the Committee acting in its absolute discretion deems consistent with the terms of this Plan; however, if the Committee grants an ISO and a Non-ISO to a Key Employee on the same date, the right of the Key Employee to exercise the ISO shall not be conditioned on his or her failure to exercise the Non-ISO.

7.2.$100,000 Limit. No Option shall be treated as an ISO to the extent that the aggregate Fair Market Value of the Stock subject to the Option which would first become exercisable in any calendar year exceeds $100,000. Any such excess shall instead automatically be treated as a Non-ISO. The Committee shall interpret and administer the ISO limitation set forth in this § 7.2 in accordance with § 422(d) of the Code, and the Committee shall treat this § 7.2 as in effect only for those periods for which § 422(d) of the Code is in effect.

7.3.Option Price. The Option Price for each share of Stock subject to an Option (other than with respect to a Substitute Award) shall be no less than the Fair Market Value of a share of Stock on the date the Option is granted; provided, however, if the Option is an ISO granted to a Key Employee who is a Ten Percent Shareholder, the Option Price for each share of Stock subject to such ISO shall be no less than 110% of the Fair Market Value of a share of Stock on the date such ISO is granted. Except for adjustments under § 16, without the approval of the 
8

Company’s stockholders, the Option Price shall not be reduced after the Option is granted, an Option (with a fair market value less than the Option Price) may not be cancelled in exchange for cash or another Award (other than in connection with a Change in Control or a Substitute Award), and no other action may be with respect to an Option that would be treated as a repricing under the rules and regulations of the principal securities exchange on which the Stock is traded.

7.4.Payment. The Option Price shall be payable in full upon the exercise of any Option, and at the discretion of the Committee an Option Certificate can provide for the payment of the Option Price either in cash, by check or in Stock and which is acceptable to the Committee or in any combination of cash, check and such Stock. The Option Price in addition may be paid (i) through any cashless exercise procedure which is acceptable to the Committee or its delegate and which is facilitated through a sale of Stock, (ii) with the consent of the Committee, by withholding Stock otherwise issuable in connection with the exercise of the Option, and (iii) through any other method specified in an Award agreement. Any payment made in Stock (including withholding of Stock) shall be treated as equal to the Fair Market Value of such Stock on the exercise date.

7.5.Exercise Period. Each Option granted under this Plan shall be exercisable in whole or in part at such time or times as set forth in the related Option Certificate, but in no event may an Option granted to an employee of the Company or any Subsidiary be exercisable before the expiration of one year from the date the Option is granted, except as otherwise permitted with respect to Substitute Awards, under circumstances contemplated by § 16, or under § 6.2 hereof. No Option Certificate shall make an Option exercisable on or after the earlier of (1) the date which is the fifth anniversary of the date the Option is granted, if the Option is an ISO and the Key Employee is a Ten Percent Shareholder on the date the Option is granted, or (2) the date which is the tenth anniversary of the date the Option is granted, if the Option is (a) a Non-ISO or (b) an ISO which is granted to a Key Employee who is not a Ten Percent Shareholder on the date the Option is granted. An Option Certificate may provide for the exercise of an Option after the employment of a Key Employee or service of a Director has terminated for any reason whatsoever, including death or disability.

7.6.Reload Option Grants, Dividends Prohibited. The Committee may not, as part of the grant of an Option, provide in the related Option Certificate for “reload” Option grants (i.e., the automatic grant of an additional Option to pay all or a part of the Option Price or using Stock to satisfy all or a part of any related tax withholding requirement). The Committee may not, as part of the grant of an Option, provide that dividends or dividend equivalents be paid with respect to such Option.

SECTION 8.
STOCK APPRECIATION RIGHTS

8.1.Committee Action. The Committee acting in its absolute discretion shall have the right to grant Stock Appreciation Rights to Key Employees and Directors under this Plan from time to time, and each Stock Appreciation Right grant shall be evidenced by a Stock Appreciation Right Certificate or, if such Stock Appreciation Right is granted as part of an Option, shall be evidenced by the Option Certificate for the related Option.

9

8.2.Terms and Conditions.

(a)Stock Appreciation Right Certificate. If a Stock Appreciation Right is evidenced by a Stock Appreciation Right Certificate, such certificate shall set forth the number of shares of Stock on which the Key Employee’s or Director’s right to appreciation shall be based and the SAR Value of each share of Stock. Such SAR Value shall be no less than the Fair Market Value of a share of Stock on the date that the Stock Appreciation Right is granted. Except for adjustments under § 16, without the approval of the Company’s stockholders the SAR Value shall not be reduced after the Stock Appreciation Right is granted, a Stock Appreciation Right may not be cancelled in exchange for cash or another Award (other than in connection with a Change in Control or a Substitute Award), and no other action may be taken with respect to a Stock Appreciation Right that would be treated as a repricing under the rules and regulations of the principal securities exchange on which the Stock is traded. The Stock Appreciation Right Certificate shall set forth such other terms and conditions for the exercise of the Stock Appreciation Right as the Committee deems appropriate under the circumstances, but in no event may Stock Appreciation Right granted to an employee of the Company or any Subsidiary be exercisable before the expiration of one year from the date the Stock Appreciation Right is granted, except as otherwise permitted with respect to Substitute Awards, under circumstances contemplated by § 16, or under § 6.2 hereof. No Stock Appreciation Right Certificate shall make a Stock Appreciation Right exercisable on or after the date which is the tenth anniversary of the date such Stock Appreciation Right is granted.

(b)Option Certificate. If a Stock Appreciation Right is evidenced by an Option Certificate, the number of shares of Stock on which the Key Employee’s or Director’s right to appreciation shall be based shall be the same as the number of shares of Stock subject to the related Option and the SAR Value for each such share of Stock shall be no less than the Option Price under the related Option. Each such Option Certificate shall provide that the exercise of the Stock Appreciation Right with respect to any share of Stock shall cancel the Key Employee’s or Director’s right to exercise his or her Option with respect to such share and, conversely, that the exercise of the Option with respect to any share of Stock shall cancel the Key Employee’s or Director’s right to exercise his or her Stock Appreciation Right with respect to such share. A Stock Appreciation Right which is granted as part of an Option shall be exercisable only while the related Option is exercisable. The Option Certificate shall set forth such other terms and conditions for the exercise of the Stock Appreciation Right as the Committee deems appropriate under the circumstances, but in no event may Stock Appreciation Right granted to an employee of the Company or any Subsidiary be exercisable before the expiration of one year from the date the Stock Appreciation Right is granted, except as otherwise permitted with respect to Substitute Awards, under circumstances contemplated by § 16, or under § 6.2 hereof.

8.3.Exercise. A Stock Appreciation Right shall be exercisable only when the Fair Market Value of a share of Stock on which the right to appreciation is based exceeds the SAR Value for such share, and the payment due on exercise shall be based on such excess with respect to the number of shares of Stock to which the exercise relates. A Key Employee or Director upon the exercise of his or her Stock Appreciation Right shall receive a payment from the Company in cash or in Stock issued under this Plan, or in a combination of cash and Stock, and the number of shares of Stock issued shall be based on the Fair Market Value of a share of Stock on the date the 
10

Stock Appreciation Right is exercised. The Committee acting in its absolute discretion shall have the right to determine the form and time of any payment under this § 8.3. The Committee may not, as part of the grant of a Stock Appreciation Right, provide that dividends or dividend equivalents be paid with respect to such Stock Appreciation Right.

SECTION 9.
RESTRICTED STOCK UNITS

9.1.Committee Action. The Committee acting in its absolute discretion shall have the right from time to time to grant to Key Employees and Directors under this Plan Restricted Stock Units, the value of each of which corresponds to the Fair Market Value of a share of Stock. Each Restricted Stock Unit grant shall be evidenced by a Restricted Stock Unit Certificate that shall set forth the number of Restricted Stock Units granted to the Key Employee or Director, the vesting schedule applicable to such Restricted Stock Units and such other terms and conditions of such grant as the Committee acting in its absolute discretion deems consistent with the terms of this Plan. Restricted Stock Units subject solely to continued service with the Company or a Subsidiary shall not become vested over a period of less than one (1) year from the date of grant; provided that such restrictions shall not be applicable to the extent that a shorter vesting period is permitted in accordance with § 6.2 hereof. Notwithstanding § 6.2 hereof, Restricted Stock Units subject to the achievement of performance objectives shall not become vested over a period of less than one (1) year.

9.2.No Adjustment for Cash Dividends. Except for dividend equivalent adjustments made by the Committee in accordance with § 16.1, unless otherwise determined by the Committee, there shall be no adjustment to Restricted Stock Units for dividends paid by the Company. In no event shall dividend equivalent rights be paid on Restricted Stock Units that are not vested unless and only to the extent the underlying Restricted Stock Units vest.

9.3.Payment for Restricted Stock Units. Unless a Key Employee or Director has made a deferral election in accordance with § 9.4, a Key Employee or Director shall receive upon the vesting of a Restricted Stock Unit payment from the Company in Stock issued under this Plan, and the number of shares of Stock issued to the Key Employee or Director shall be equal to the number of Restricted Stock Units that have at such time become vested. At the time a Key Employee or Director receives shares of stock equal in number to such Key Employee’s or Director’s vested Restricted Stock Units, such vested Restricted Stock Units shall automatically be cancelled and shall give the Key Employee or Director no further rights to payment of any kind.

9.4.Deferrals. The Committee, in its absolute discretion, may permit a Key Employee or Director to elect to defer such Key Employee’s or Director’s receipt of the delivery of shares of Stock that would otherwise be due to such Key Employee or Director by virtue of the vesting of a Restricted Stock Unit; provided such deferral election is made in accordance with the requirements of Section 409A of the Code. If any such deferral election is permitted by the Committee, the Committee shall, in its absolute discretion, establish additional rules and procedures for such payment deferrals. However, notwithstanding the preceding provisions of this § and notwithstanding any other provision of this Plan to the contrary, the Committee shall not, (1) in establishing the terms and provisions of any grant of Restricted Stock Units, or (2) in exercising its powers under this § 9.4, create any arrangement which would constitute an 
11

employee pension benefit plan as defined in § 3(2) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), unless the arrangement provides benefits solely to one or more individuals who constitute members of a select group of management or highly compensated employees (within the meaning of ERISA §§ 201(2), 301(a)(3), 401(a)(1) and 4021(b)(6)).

9.5.Performance-Based Vesting. Notwithstanding anything contained in § 9.1 hereof, the Committee may, at the time of grant of Restricted Stock Units to Key Employees, prescribe that vesting of all or any the Restricted Stock Units shall be subject to the achievement of one or more performance objectives and to such other provisions of § 11 as the Committee determines shall apply, including the Performance Goals set forth in § 11.3.

SECTION 10.
STOCK GRANTS

10.1.Committee Action. The Committee acting in its absolute discretion shall have the right to make Stock Grants to Key Employees and Directors. Each Stock Grant shall be evidenced by a Stock Grant Certificate, and each Stock Grant Certificate shall set forth the conditions, if any, under which Stock will be issued under the Stock Grant and the conditions under which the Key Employee’s or Director’s interest in any Stock which has been issued will become non-forfeitable.

10.2.Conditions.

(a)Conditions to Issuance of Stock. The Committee acting in its absolute discretion may make the issuance of Stock under a Stock Grant subject to the satisfaction of one, or more than one, condition which the Committee deems appropriate under the circumstances for Key Employees or Directors generally or for a Key Employee or Director in particular, and the related Stock Grant Certificate shall set forth each such condition and the deadline for satisfying each such condition. Stock subject to a Stock Grant shall be issued in the name of a Key Employee or Director only after each such condition, if any, has been timely satisfied, and any Stock which is so issued shall be held by the Company pending the satisfaction of the forfeiture conditions, if any, under § 10.2(b) for the related Stock Grant.

(b)Forfeiture Conditions. The Committee acting in its absolute discretion may make Stock issued in the name of a Key Employee or Director subject to one, or more than one, objective employment, performance or other forfeiture condition that the Committee acting in its absolute discretion deems appropriate under the circumstances for Key Employees or Directors generally or for a Key Employee or Director in particular, and the related Stock Grant Certificate shall set forth each such forfeiture condition, if any, and the deadline, if any, for satisfying each such forfeiture condition. A Stock Grant Certificate may not provide for vesting of the Stock Grant subject solely to continued service with the Company or a Subsidiary over a period of less than one (1) year from the date of grant; provided that such restrictions shall not be applicable to the extent that a shorter vesting period is permitted in accordance with § 6.2 hereof. Notwithstanding § 6.2 hereof, Stock Grants subject to the achievement of performance conditions shall not become vested over a period of less than one (1) year. A Key Employee’s or Director’s 

12

non-forfeitable interest in the shares of Stock underlying a Stock Grant shall depend on the extent to which he or she timely satisfies each such condition.

10.3.Dividends and Voting Rights. If a cash dividend is paid on a share of Stock after such Stock has been issued under a Stock Grant but before the first date that a Key Employee’s or Director’s interest in such Stock (1) is forfeited completely or  (2)  becomes  completely non-forfeitable, the Company shall pay such cash dividend directly to such Key Employee or Director except as otherwise be provided in the Award agreement. If a Stock dividend is paid on such a share of Stock during such period, such Stock dividend shall be treated as part of the related Stock Grant, and a Key Employee’s or Director’s interest in such Stock dividend shall be forfeited or shall become non-forfeitable at the same time as the Stock with respect to which the Stock dividend was paid is forfeited or becomes non-forfeitable. In no event shall any cash dividends or dividend equivalents be paid with respect to an Award of Restricted Stock Unit, Stock Grant or Performance Unit until such Award is vested and non-forfeitable, it being understood that dividends or dividend equivalents may be credited with respect to such Award, with payment subject to such Award actually vesting (if any). The disposition of each other form of dividend which is declared on such a share of Stock during such period shall be made in accordance with such rules as the Committee shall adopt with respect to each such dividend. A Key Employee or Director also shall have the right to vote the Stock issued under his or her Stock Grant during such period.

10.4.Satisfaction of Forfeiture Conditions. A share of Stock shall cease to be subject to a Stock Grant at such time as a Key Employee’s or Director’s interest in such Stock becomes non- forfeitable under this Plan, and the certificate representing such share shall be transferred to the Key Employee or Director as soon as practicable thereafter.

10.5.Performance-Based Vesting. The Committee may, at the time a Stock Grant is made, prescribe that vesting of all or any portion of the shares subject to the Stock Grant shall be subject to the achievement of one or more performance conditions and to such other provisions of § 11 as the Committee determines shall apply, including the Performance Goals set forth in § 11.3.

SECTION 11.
PERFORMANCE UNITS

11.1.Committee Action. The Committee (acting in its sole discretion) may from time to time grant Performance Units to Key Employees under the Plan representing the right to receive in cash an amount determined by reference to certain performance measurements, subject to such restrictions, conditions and other terms as the Committee may determine. Use of the term “Performance Unit” in this § 11 shall also include “Restricted Stock Unit” or “Stock Award” if the Committee has applied §§ 9.5 or 10.5 to such Award.

11.2.Conditions. The written agreement covering Performance Units shall specify Performance Goals (as defined in § 11.3), a Performance Period (as defined in § 11.5)) and an Ending Value. Performance Units granted to a Key Employee shall be credited to a bookkeeping account established and maintained for such Key Employee.

11.3.Performance Goals. With respect to each Award of Performance Units, the Committee (acting in its sole discretion) shall specify as Performance Goals the corporate, 
13

division, segment, business unit, and/or individual performance goals which must be satisfied in order for the Key Employee to be entitled to payment to such Performance Units. Performance Goals for an Award of Performance Units to a Covered Officer shall be based on achieving specified levels of one or any combination of the following with respect to the Company on a consolidated basis, by division, segment, and/or business unit: net sales; revenue; revenue growth or product revenue growth; operating income (before or after taxes); pre- or after-tax income (before or after allocation of corporate overhead and bonus); earnings per share; net income (before or after taxes); return on equity; total stockholder return; return on assets or net assets; appreciation in and/or maintenance of the price of the Shares or any other publicly-traded securities of the Company; market share; gross profits; earnings (including earnings before taxes, earnings before interest and taxes, earnings before interest, taxes, depreciation and amortization or earnings before interest, taxes, depreciation, amortization and option expense); economic value-added models or equivalent metrics; comparisons with various stock market indices; cost reductions, savings, controls or objectives; cash flow or cash flow per share (before or after dividends); return on capital (including return on total capital or return on invested capital); cash flow return on investment; improvement in or attainment of expense levels or working capital levels; operating margins, gross margins or cash margin; operating efficiencies; year-end cash; debt reductions; stockholder equity; specific and objectively determinable regulatory achievements; and implementation, completion or attainment of specific and objectively determinable objectives with respect to research, development, products or projects, production volume levels, acquisitions and divestitures and recruiting and maintaining personnel. The Performance Goals also may be based solely by reference to the Company’s performance or the performance of a Subsidiary, division, business segment or business unit of the Company, or based upon the relative performance of other companies or upon comparisons of any of the indicators of performance relative to other companies. The Committee may express any goal in alternatives, such as including or excluding (a) any acquisitions or dispositions, restructurings, discontinued operations, extraordinary items, and other unusual or non-recurring charges, (b) any event either not directly related to the operations of the Company or not within the reasonable control of the Company’s management, or (c) the cumulative effects of tax or accounting changes in accordance with U.S. generally accepted accounting principles. The Committee may appropriately adjust any evaluation of performance under criteria set forth in this § 11.3 to exclude any of the following events that occur during a performance period: (i) asset impairments or write-downs, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reported results, (iv) accruals for reorganization and restructuring programs, (v) any items that are “unusual in nature” or “infrequently occurring” within the meaning of generally accepted accounting principles or other extraordinary items that are included within management’s discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to shareholders for the applicable year, (vi) the effect of adverse federal, governmental or regulatory action, or delays in federal, governmental or regulatory action, and (vii) any other event that the Committee determines is not directly related to the operations of the Company or not within the reasonable control of the Company’s management.

11.4.Performance Period. The Committee (acting in its sole discretion) shall determine the Performance Period, which shall be the period of time during which the Performance Goals must be satisfied in order for the Key Employee to be entitled to payment of Performance Units granted to such Key Employee. Different Performance Periods may be established for different Performance Units. Performance Periods may run consecutively or concurrently.
14

11.5.Payment for Performance Units. As soon as practicable following the end of a Performance Period, the Committee shall determine whether the Performance Goals for the Performance Period have been achieved. As soon as reasonably practicable after such determination, or at such later date or in such installments as the Committee shall determine at the time of grant, the Company shall pay to the Key Employee an amount in cash equal to the Ending Value of each Performance Unit as to which the Performance Goals have been satisfied.

SECTION 12.
DIRECTOR AWARDS

12.1.Awards. The Board may provide that all or a portion of a Director’s annual retainer, meeting fees and/or other awards or compensation as determined by the Board, be payable (either automatically or at the election of a Director) in the form of Non-Qualified Stock Options, Restricted Share Units and/or Stock-Based Awards, including unrestricted Shares. The Board shall determine the terms and conditions of any such Awards, including the terms and conditions which shall apply upon a termination of the Director’s service as a member of the Board, and shall have full power and authority in its discretion to administer such Awards, subject to the terms of the Plan and applicable law. Subject to applicable legal requirements, the Board may also grant Awards to Directors pursuant to the terms of the Plan, including any Award described in §§ 7, 8, 9 or 10 above.

12.2.Applicable Limit. Notwithstanding anything herein to the contrary, the aggregate value of all compensation paid or granted, as applicable, to any individual for service as a Director with respect to any calendar year, including equity Awards granted and cash fees paid by the Company to such Director, shall not exceed five hundred thousand dollars ($500,000) in value, calculating the value of any equity Awards granted during such calendar year based on the grant date fair value of such Awards for financial reporting purposes.

SECTION 13.
NON-TRANSFERABILITY

Except as provided below, no Award shall be transferable by a Key Employee or Director other than by will or by the laws of descent and distribution. Any Option or Stock Appreciation Right shall (absent the Committee’s consent) be exercisable during a Key Employee’s or Director’s lifetime only by the Key Employee or Director. To the extent and under such terms and conditions as determined by the Committee, a Key Employee or Director may assign or transfer an Award (each transferee thereof, a “Permitted Assignee”) to (i) the Key Employee’s or Director’s spouse, children or grandchildren (including any adopted and step children or grandchildren), parents, grandparents or siblings, (ii) to a trust for the benefit of one or more of the Key Employee or Director or the persons referred to in clause (i), (iii) to a partnership, limited liability company or corporation in which the Key Employee or Director or the persons referred to in clause (i) are the only partners, members or stockholders or (iv) for charitable donations; provided that such Permitted Assignee shall be bound by and subject to all of the terms and conditions of the Plan and the Award Agreement relating to the transferred Award and shall execute an agreement satisfactory to the Company evidencing such obligations; and provided further that such Key Employee or Director shall remain bound by the terms and conditions of the Plan. The person or persons to whom an Award is transferred by will or by the laws of descent and distribution (or with the Committee’s consent) thereafter shall be treated as the Key Employee or Director with respect to such Award.
15

SECTION 14.
SECURITIES REGISTRATION

As a condition to the receipt of shares of Stock under this Plan, the Key Employee or Director shall, if so requested by the Company, agree to hold such shares of Stock for investment and not with a view toward resale or distribution to the public and, if so requested by Company, shall deliver to Company a written statement satisfactory to Company to that effect. Furthermore, if so requested by the Company, the Key Employee or Director shall make a written representation to Company that he or she will not sell or offer for sale any of such Stock unless a registration statement shall be in effect with respect to such Stock under the 1933 Act and any applicable federal or state securities law or he or she shall have furnished to Company an opinion in form and substance satisfactory to Company or its legal counsel satisfactory to Company that such registration is not required. Certificates representing the Stock transferred upon the exercise of an Option, Stock Appreciation Right or Restricted Stock Unit or upon the lapse of the forfeiture conditions, if any, on any Stock Grant may at the discretion of Company bear a legend to the effect that such Stock has not been registered under the 1933 Act or any applicable state securities law and that such Stock cannot be sold or offered for sale in the absence of an effective registration statement as to such Stock under the 1933 Act and any applicable state securities law or an opinion in form and substance satisfactory to the Company of legal counsel satisfactory to the Company that such registration is not required.

SECTION 15. LIFE OF PLAN

No Award shall be made under this Plan on or after the earlier of (1) the tenth anniversary of the effective date of this Plan (as determined under § 4), in which event this Plan otherwise thereafter shall continue in effect until all outstanding Options and Stock Appreciation Rights have been exercised in full or no longer are exercisable, all Stock issued under any Stock Grants under this Plan have been forfeited or have become non-forfeitable, all Restricted Stock Units have vested and all Performance Periods have ended, or (2) the date on which all of the Stock reserved under § 3 has (as a result of the exercise of Options or Stock Appreciation Rights granted under this Plan the satisfaction of the forfeiture conditions, if any, on Stock Grants, or the payment of shares upon the vesting of Restricted Stock Units) been issued or no longer is available for use under this Plan, in which event this Plan also shall terminate on such date.

SECTION 16. ADJUSTMENT

16.1.Capital Structure. The number, kind or class (or any combination thereof) of shares of Stock reserved under § 3, the annual grant caps described in § 6, the number, kind or class (or any combination thereof) of shares of Stock subject to Options, Restricted Stock Units or Stock Appreciation Rights granted under this Plan, the Option Price of such Options, the SAR Value of such Stock Appreciation Rights as well as the number, kind or class (or any combination thereof) of shares of Stock subject to Stock Grants granted under this Plan shall be adjusted by the Committee in an equitable manner to reflect any change in the capitalization of the Company, including, but not limited to, an unusual or non-recurring dividend or other distribution (whether in the form of an extraordinary cash dividend or a dividend of Stock, other securities or other
16

property), recapitalization, stock split, reverse stock split, split-up, spin-off, repurchase or exchange of Stock or other securities of the Company, issuance of warrants or other rights to purchase Stock or other securities of the Company, or other similar corporate transaction

16.2.Mergers. The Committee as part of any corporate transaction described in § 424(a) of the Code shall have the right to adjust (in any manner which the Committee in its discretion deems consistent with § 424(a) of the Code) the number, kind or class (or any combination thereof) of shares of Stock reserved under § 3 and the annual grant caps described in § 6. Furthermore, the Committee as part of any corporate transaction described in § 424(a) of the Code shall have the right to adjust (in any manner which the Committee in its discretion deems consistent with § 424(a) of the Code) the number, kind or class (or any combination thereof) of shares of Stock subject to any outstanding Stock Grants under this Plan and any related grant conditions and forfeiture conditions, and the number, kind or class (or any combination thereof) of shares subject to Option, Restricted Stock Unit and Stock Appreciation Right grants previously made under this Plan and the related Option Price and SAR Value for each such Option Stock Appreciation Right and, further, shall have the right (in any manner which the Committee in its discretion deems consistent with § 424(a) of the Code and without regard to the annual grant caps described in § 6 of this Plan) to make any Stock Grants and Option Stock Appreciation Right and Restricted Stock Unit grants to effect the assumption of, or the substitution for, stock grants and option, restricted stock unit and stock appreciation right grants previously made by any other corporation to the extent that such corporate transaction calls for such substitution or assumption of such stock grants and stock option, restricted stock unit and stock appreciation right grants.

16.3.Fractional Shares. If any adjustment under this § 16 would create a fractional share of Stock or a right to acquire a fractional share of Stock, such fractional share shall be disregarded and the number of shares of Stock reserved under this Plan and the number subject to any Options, Restricted Stock Unit or Stock Appreciation Right grants and Stock Grants shall be the next lower number of shares of Stock, rounding all fractions downward. An adjustment made under this § 16 by the Committee shall be conclusive and binding on all affected persons.

SECTION 17.
CHANGE IN CONTROL

17.1.Assumption or Substitution of Certain Awards. Unless otherwise provided in an Award Agreement, in the event of a Change in Control in which the successor company assumes or substitutes for an Option, Restricted Stock Unit, Stock Appreciation Right, or Stock Grant, if a Key Employee’s employment with such successor company (or a subsidiary thereof) terminates under the circumstances specified in the Award Agreement within 12 months following such Change in Control (or such other period set forth in the Award Agreement, including prior thereto if applicable): (i) Options and Stock Appreciation Rights outstanding as of the date of such termination of employment will immediately vest, become fully exercisable, and may thereafter be exercised for 12 months (or the period of time set forth in the Award Agreement), and (ii) restrictions, limitations and other conditions applicable to Restricted Stock Units and Stock Grants shall lapse and the Restricted Stock Units and Stock Grants shall become free of all restrictions and limitations and become fully vested. For the purposes of this § 17.1, an Option, Restricted Stock Unit, Stock Appreciation Right, Award or Stock Grant shall be considered assumed or substituted for if following the Change in Control the Award confers the right (on the same terms
17

and conditions and consistent with the first sentence of this § 17.1) to purchase or receive, for each share of Stock subject to the Option, Restricted Stock Unit, Stock Appreciation Right, or Stock Grant immediately prior to the Change in Control, the consideration (whether stock, cash or other securities or property) received in the transaction constituting a Change in Control by holders of shares of Stock for each share of Stock held on the effective date of such transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares); provided, however, that if such consideration received in the transaction constituting a Change in Control is not solely common stock of the successor company, the Committee may, with the consent of the successor company, provide that the consideration to be received upon the exercise or vesting of an Option, Restricted Stock Unit, Stock Appreciation Right or Stock Grant, for each share of Stock subject thereto, will be solely common stock of the successor company substantially equal in fair market value to the per share consideration received by holders of shares of Stock in the transaction constituting a Change in Control. The determination of such substantial equality of value of consideration shall be made by the Committee in its sole discretion and its determination shall be conclusive and binding.

17.2.Non-Assumption or Substitution of Certain Awards. Unless otherwise provided in an Award Agreement in the event of a Change in Control, to the extent the successor company does not assume or substitute for an Option, Restricted Stock Unit, Stock Appreciation Right, or Stock Grant: (i) those Options and Stock Appreciation Rights outstanding as of the date of the Change in Control that are not assumed or substituted for shall immediately vest and become fully exercisable, and (ii) restrictions and deferral limitations on Restricted Stock Units and Stock Grants that are not assumed or substituted for shall lapse and the Restricted Stock Units and Stock Grants shall become free of all restrictions and limitations and become fully vested.

17.3.Impact on Certain Awards. Award Agreements may provide that in the event of a Change in Control: (i) Options and Stock Appreciation Rights outstanding as of the date of the Change in Control shall be cancelled and terminated without payment therefor if the Fair Market Value of one share of Stock as of the date of the Change in Control is less than the Option Price or SAR Value, and (ii) all Performance Units and other performance-based Awards shall be considered to be earned and payable (either in full based on actual performance or pro rata based on actual performance or based on the portion of Performance Period completed as of the date of the Change in Control), and any limitations or other restriction shall lapse and such Performance Units shall be immediately settled or distributed.

SECTION 18.
AMENDMENT OR TERMINATION

This Plan may be amended by the Board from time to time to the extent that the Board deems necessary or appropriate; provided, however, (1) no amendment shall be made absent the approval of the stockholders of the Company to the extent such approval is required under applicable law or exchange rule and (2) no amendment shall be made to § 17 on or after any date described in § 17 which might adversely affect any rights which otherwise vest on such date. The Board also may suspend granting Awards under this Plan at any time and may terminate this Plan at any time; provided, however, the Board shall not have the right unilaterally to modify, amend or cancel any Award made before such suspension or termination unless (x) the Key Employee or
18

Director consents in writing to such modification, amendment or cancellation or (y) there is a dissolution or liquidation of the Company or a transaction described in § 16 or § 17.

SECTION 19.
MISCELLANEOUS

19.1.Stockholder Rights. No Key Employee or Director shall have any rights as a stockholder of the Company as a result of the grant of an Option or a Restricted Stock Unit or Stock Appreciation Right pending the actual delivery of the Stock subject to such Option, Restricted Stock Unit or Stock Appreciation Right to such Key Employee or Director. Subject to
§ 10.3, a Key Employee’s or Director’s rights as a stockholder in the shares of Stock underlying a Stock Grant which is effective shall be set forth in the related Stock Grant Certificate.

19.2.No Contract of Employment or Service. The grant of an Award to a Key Employee or Director under this Plan shall not constitute a contract of employment or service and shall not confer on a Key Employee or Director any rights upon his or her termination of employment or service in addition to those rights, if any, expressly set forth in the related Option Certificate, Restricted Stock Unit Certificate, Stock Appreciation Right Certificate, Stock Grant Certificate, or Performance Unit agreement.

19.3.Withholding. A Participant may be required to pay to the Company or any Subsidiary or Affiliate and the Company or any Subsidiary or Affiliate shall have the right and is hereby authorized to withhold from any Award, from any payment due or transfer made under any Award or under the Plan, or from any compensation or other amount owing to a Participant the amount (in cash, Shares, other securities, other Awards or other property) of any applicable withholding or other tax-related obligations in respect of an Award, its exercise or any other transaction involving an Award, or any payment or transfer under an Award or under the Plan and to take such other action as may be necessary in the opinion of the Company to satisfy all obligations for the payment of such taxes. The Committee may provide for additional cash payments to holders of Options to defray or offset any tax arising from the grant, vesting, exercise or payment of any Award. Without limiting the generality of the foregoing, the Committee may in its discretion permit a Participant to satisfy or arrange to satisfy, in whole or in part, the tax obligations incident to an Award by: (a) electing to have the Company withhold Shares or other property otherwise deliverable to such Participant pursuant to the Award (provided, however, that the amount of any Shares so withheld shall not exceed the amount necessary to satisfy required federal, state local and foreign withholding obligations using the maximum statutory withholding rates for federal, state, local and/or foreign tax purposes, including payroll taxes, that are applicable to supplemental taxable income) and/or (b) tendering to the Company Shares owned by such Participant (or by such Participant and his or her spouse jointly) and purchased or held for the requisite period of time as may be required to avoid the Company’s or the Affiliates’ or Subsidiaries’ incurring an adverse accounting charge, based, in each case, on the Fair Market Value of the Shares on the payment date as determined by the Committee. All such elections shall be irrevocable, made in writing, signed by the Participant, and shall be subject to any restrictions or limitations that the Committee, in its sole discretion, deems appropriate.
19

19.4.Construction. All references to sections (§) are to sections (§) of this Plan unless otherwise indicated. This Plan shall be construed under the laws of the State of Delaware. Finally, each term set forth in § 2 shall have the meaning set forth opposite such term for purposes of this Plan and, for purposes of such definitions, the singular shall include the plural and the plural shall include the singular.

19.5.Other Laws. The Committee may refuse to issue or transfer any Shares or other consideration under an Award if, acting in its sole discretion, it determines that the issuance or transfer of such Shares or such other consideration might violate any applicable law or regulation (including applicable non-U.S. laws or regulations) or entitle the Company to recover the same under Exchange Act Section 16(b), and any payment tendered to the Company by a Participant, other holder or beneficiary in connection with the exercise of such Award shall be promptly refunded to the relevant Participant, holder or beneficiary.

19.6.Compliance with Section 409A of the Code. No Award (or modification thereof) shall provide for deferral of compensation that does not comply with Section 409A of the Code unless the Committee, at the time of grant, specifically provides that the Award is not intended to comply with Section 409A of the Code. Notwithstanding any provision of this Plan to the contrary, if one or more of the payments or benefits received or to be received by a Participant pursuant to an Award would cause the Participant to incur any additional tax or interest under Section 409A of the Code, the Committee may reform such provision to maintain to the maximum extent practicable the original intent of the applicable provision without violating the provisions of Section 409A of the Code. In addition, if a Participant is a Specified Employee at the time of his or her Separation from Service, any payments with respect to any Award subject to Section 409A of the Code to which the Participant would otherwise be entitled by reason of such Separation from Service shall be made on the date that is six months after the Participant’s Separation from Service (or, if earlier, the date of the Participant’s death). Although the Company intends to administer the Plan so that Awards will be exempt from, or will comply with, the requirements of Section 409A of the Code, the Company does not warrant that any Award under the Plan will qualify for favorable tax treatment under Section 409A of the Code or any other provision of federal, state, local or foreign law. The Company shall not be liable to any Participant for any tax, interest, or penalties that Participant might owe as a result of the grant, holding, vesting, exercise, or payment of any Award under the Plan. Any capitalized term in this § 19.6 not otherwise defined herein shall have such meaning as ascribed to it under Section 409A of the Code.

19.7.Award Agreements. Each Award hereunder shall be evidenced by an Award Agreement that shall be delivered to the Participant and may specify the terms and conditions of the Award and any rules applicable thereto. In the event of a conflict between the terms of the Plan and any Award Agreement, the terms of the Plan shall prevail. The Committee shall, subject to applicable law, determine the date an Award is deemed to be granted. The Committee or, except to the extent prohibited under applicable law, its delegate(s) may establish the terms of agreements or other documents evidencing Awards under this Plan and may, but need not, require as a condition to any such agreement’s or document’s effectiveness that such agreement or document be executed by the Participant, including by electronic signature or other electronic indication of acceptance, and that such Participant agree to such further terms and conditions as specified in such agreement or document. The grant of an Award under this Plan shall not confer any rights upon the Participant holding such Award other than such terms, and subject to such 
20

conditions, as are specified in this Plan as being applicable to such type of Award (or to all Awards) or as are expressly set forth in the agreement or other document evidencing such Award. Subject to the restrictions otherwise found in this Plan, the Committee may waive any conditions or rights under, amend any terms of or alter, suspend, discontinue, cancel or terminate, any Award theretofore granted, prospectively or retroactively (and in accordance with Section 409A of the Code with regard to Awards subject thereto); provided that any such waiver, amendment, alteration, suspension, discontinuance, cancellation or termination that would materially and adversely affect the rights of any Participant or any holder or beneficiary of any Award theretofore granted shall not to that extent be effective without the consent of the affected Participant, holder or beneficiary.

19.8.No Limit on Other Compensation Arrangements. Nothing contained in the Plan shall prevent the Company or any Subsidiary or Affiliate from adopting or continuing in effect other compensation arrangements, which may, but need not, provide for the grant of Options, Restricted Shares, Restricted Share Units, Stock-Based Awards or other types of Awards provided for hereunder.

19.9.Severability. If any provision of the Plan or any Award is, or becomes, or is deemed to be invalid, illegal or unenforceable in any jurisdiction or as to any Person or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to the applicable laws, or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction, Person or Award and the remainder of the Plan and any such Award shall remain in full force and effect.

19.10.Awards to Non-U.S. Participants. The Committee shall have the power and authority to determine which service providers outside the United States shall be eligible to participate in the Plan. Without amending the Plan, the Committee may grant Awards to eligible persons who are foreign nationals and/or reside outside the United States on such terms and conditions different from those specified in this Plan as may in the judgment of the Committee be necessary or desirable to foster and promote achievement of the purposes of this Plan. The Committee may adopt, amend or rescind rules, procedures or sub-plans relating to the operation and administration of the Plan to accommodate the specific requirements of local laws, procedures, and practices.

19.11.Company Clawback Policy. Any Award granted pursuant to this Plan shall be subject to mandatory repayment by the Participant to the Company to the extent that such Participant is, or in the future becomes, subject to (a) any “clawback” or recoupment policy adopted by the Company or any Affiliate thereof to comply with the requirements of any applicable laws, rules or regulations, including pursuant to final rules adopted by the SEC pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, or otherwise, or (b) any applicable laws which impose mandatory recoupment, under circumstances set forth in such applicable laws, including the Sarbanes-Oxley Act of 2002.

19.12.No Trust or Fund Created. Neither the Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company or any Subsidiary or Affiliate and a Participant or any other Person. To the extent that any Person acquires a right to receive payments from the Company or any Subsidiary or Affiliate
21

pursuant to an Award, such right shall be no greater than the right of any unsecured general creditor of the Company or any Subsidiary or Affiliate.

19.13.Headings. Headings are given to the sections and subsections of the Plan solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof.

[signature page follows]
22

IN WITNESS WHEREOF, Option Care Health, Inc. has caused its duly authorized officer to execute this Plan to evidence its adoption of this Plan.

OPTION CARE HEALTH, INC.

By: /s/ Michael Shapiro

Date: May 19, 2021

23Exhibit 10.1

 

TIVIC HEALTH SYSTEMS INC.

SERIES SEED-1, SEED-2, SEED-3 AND SEED-4 

PREFERRED STOCK INVESTMENT AGREEMENT

 

     

     

    

 

TIVIC HEALTH SYSTEMS INC.

SERIES SEED-1, SEED-2, SEED-3 AND SEED-4 

PREFERRED STOCK INVESTMENT AGREEMENT

 

This Series Seed-1, Seed-2,
Seed-3 and Seed-4 Preferred Stock Investment Agreement (this “Agreement”) is made as of July 16, 2019 by and
among Tivic Health Systems Inc., a California corporation (the “Company”) and the investors listed on Exhibit A
attached to this Agreement (each a “Purchaser” and together the “Purchasers”).

 

The parties hereby agree as
follows.

 

1.                 
PURCHASE AND SALE OF PREFERRED STOCK.

 

1.1             
Sale and Issuance of Preferred Stock.

 

1.1.1       
The Company shall adopt and file with the Secretary of State of the State of California on or before the Closing (as defined below)
the Amended and Restated Articles of Incorporation in substantially the form of Exhibit B attached to this Agreement (as the
same may be amended, restated, supplemented or otherwise modified from time to time, the “Restated Articles”).

 

1.1.2       
Subject to the terms and conditions of this Agreement, each Purchaser agrees to purchase at the applicable Closing, and the Company
agrees to sell and issue to each Purchaser at the applicable Closing, that number of shares of (w) Series Seed-4 Preferred Stock (the
 “Series Seed-4 Preferred Stock”) set forth opposite each Purchaser’s name on Exhibit A, at a purchase
price of $1.1681 per share, (x) Series Seed-3 Preferred Stock (the “Series Seed-3 Preferred Stock”) set forth
opposite each Purchaser’s name on Exhibit A, at a purchase price of $0.5841 per share, (y) Series Seed-2 Preferred Stock
(the “Series Seed-2 Preferred Stock”) set forth opposite each Purchaser’s name on Exhibit A, at
a purchase price of $1.1227 per share, and (z) Series Seed-1 Preferred Stock (the “Series Seed-1 Preferred Stock”)
set forth opposite each Purchaser’s name on Exhibit A, at a purchase price of $1.4034 per share. The shares of Series Seed-1
Preferred Stock, shares of Series Seed-2 Preferred Stock, the shares of Series Seed-3 Preferred Stock and the shares of Series Seed-4
Preferred Stock issued to the Purchasers pursuant to this Agreement shall be referred to in this Agreement as the “Shares.”
The rights, privileges and benefits of the Shares are as set forth in the Restated Articles.

 

1.2             
Closing; Delivery.

 

1.2.1       
The initial purchase and sale of the Shares shall take place remotely via the exchange of documents and signatures, on the date
hereof (which time and place are designated as the (“Initial Closing”). At the Initial Closing, the Purchasers
will purchase from the Company the total number of shares of Series Seed-1 Preferred Stock set forth opposite such Purchaser’s name
on Exhibit A under “Initial Closing” and pay the purchase price therefor as set forth on Exhibit A, and
the holders of SAFEs and Notes (each as herein below defined) shall receive shares of Series Seed-2 Preferred Stock, Series Seed-3 Preferred
Stock, and/or Series Seed-4 Preferred Stock pursuant to Section 3.11. At the Initial Closing, each Purchaser shall become a party
to this Agreement and the Voting Agreement attached hereto as Exhibit C (the “Voting Agreement”), by
executing and delivering to the Company at the Initial Closing a counterpart signature page to this Agreement and the Voting Agreement.

 

    1 

     

    

 

1.2.2       
At any time and from time to time following the Initial Closing, the Company may sell, remotely via the exchange of documents and
signatures, on the same terms and conditions as those contained in this Agreement, without obtaining the signature, consent or permission
of any of the Purchasers, up to that number of shares Series Seed-1 Preferred Stock that remain unsold at the Initial Closing and Additional
Closings (the “Additional Shares”), to one or more Purchasers acceptable to the Company in its sole discretion
(the “Additional Purchasers”) in additional closings (each, an “Additional Closing”
and together with the Initial Closing the “Closings”); provided, however, that in no event shall the aggregate
number of Shares sold at all Closings exceed 9,676,396 shares. At each Additional Closing, the Purchasers will purchase from the Company
the total number of shares of Series Seed-1 Preferred Stock set forth opposite such Purchaser’s name on Exhibit A under “Additional
Closing” and pay the Purchase Price therefor as set forth on Exhibit A. At each Additional Closing, each Additional
Purchaser who has not previously purchased Shares pursuant to this Agreement shall become a party to this Agreement and the Voting Agreement,
by executing and delivering to the Company at such Additional Closing a counterpart signature page to this Agreement and the Voting Agreement.
Upon each such Additional Purchaser’s execution and delivery to the Company of the counterpart signature pages and delivery of the
purchase price to the Company, such Additional Purchaser shall become a party to, and bound by, this Agreement and the Voting Agreement
to the same extent as if such Additional Purchaser had been a Purchaser at the Initial Closing and each such Additional Purchaser shall
be deemed to be a Purchaser for all purposes under this Agreement as of the date of the applicable Additional Closing. Exhibit A
shall be updated, without any action on the part of any Purchaser, to include such Additional Purchasers.

 

1.2.3       
At each Closing, the Company shall update the Company’s stock ledger to reflect the issuance of the Shares to the Purchasers
at such Closing against payment of the purchase price therefore by check payable to the Company, by wire transfer to a bank account designated
by the Company, by cancellation or conversion of indebtedness of the Company to Purchaser, by conversion of Convertible Promissory Notes
(each such instrument, a “Note”) and/or Simple Agreements for Future Equity (SAFEs) (each such agreement, a
 “SAFE”), or by any combination of such methods.

 

2.                 
REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby represents and warrants to each Purchaser
that, except as set forth on the Disclosure Schedule attached as Exhibit D to this Agreement (the “Disclosure Schedule”),
if any, the following representations are true and complete as of the date of the Initial Closing, except as otherwise indicated. The
Disclosure Schedule shall be arranged in sections corresponding to the numbered and lettered sections and subsections contained in this
Section 2, and the disclosures in any section or subsection of the Disclosure Schedule shall qualify other sections and subsections in
this Section 2 to the extent it is readily apparent from a reading of the disclosure that such disclosure is applicable to such other
sections and subsections. Nothing in the Disclosure Schedule is intended to broaden the scope of any representation or warranty contained
in this Agreement or to create any covenant. Inclusion of any item in the Disclosure Schedule (1) does not represent a determination that
such item is material or establish a standard of materiality, (2) does not represent a determination that such item did not arise in the
ordinary course of business, (3) does not represent a determination that the transactions contemplated by the Agreement require the consent
of third parties, and (4) shall not constitute, or be deemed to be, an admission to any third party concerning such item.

 

    2 

     

    

 

2.1             
Organization, Good Standing, Corporate Power and Qualification. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of California and has all corporate power and corporate authority required (a)
to carry on its business as presently conducted and as presently proposed to be conducted and (b) to execute, deliver and perform its
obligations under this Agreement. The Company is duly qualified to transact business as a foreign corporation and is in good standing
under the laws of each jurisdiction in which the failure to so qualify or be in good standing would have a material adverse effect on
the business, assets (including intangible assets), liabilities, financial condition, property, or results of operations of the Company.

 

2.2             
Capitalization. The authorized capital of the Company consists, immediately prior to the Initial Closing (unless otherwise
noted), of the following.

 

2.2.1       
25,000,000 shares of the common stock of the Company (the “Common Stock”), 9,200,000 shares of which
are issued and outstanding immediately prior to the Closing. All of the outstanding shares of Common Stock are duly authorized, validly
issued, fully paid and nonassessable and were issued in material compliance with all applicable federal and state securities laws.

 

2.2.2       
10,113,621 shares of the preferred stock of the Company (the “Preferred Stock”), (a) 4,000,000 shares
of which are designated Series Seed-1 Preferred Stock, none of which are issued and outstanding as of the Initial Closing; (b) 774,894
shares of which are designated Series Seed-2 Preferred Stock, none of which are issued and outstanding as of the Initial Closing; (c)
3,615,580 shares of which are designated Series Seed-3 Preferred Stock, none of which are issued and outstanding as of the Initial Closing;
and (d) 1,723,147 shares of which are designated Series Seed-4 Preferred Stock, none of which are issued and outstanding as of the Initial
Closing.

 

2.2.3       
3,925,073 shares of Common Stock are subject to issuance to officers, directors, employees and consultants of the Company pursuant
to the Company’s 2017 Equity Incentive Plan duly adopted by the Board of Directors of the Company (the “Board”)
and approved by the Company shareholders (as amended to date, the “Stock Plan”). Of such shares of Common Stock
reserved under the Stock Plan, 2,785,000 have are subject to options that have been granted or have otherwise been promised by the Company,
and 1,140,073 remain available for issuance to officers, directors, employees and consultants pursuant to the Stock Plan.

 

2.2.4       
There are no outstanding preemptive rights, options, warrants, conversion privileges or rights (including but not limited to rights
of first refusal or similar rights), orally or in writing, to purchase or acquire any securities from the Company including, without limitation,
any shares of Common Stock or Preferred Stock, or any securities convertible into or exchangeable or exercisable for shares of Common
Stock or Preferred Stock, except for (a) the conversion privileges of the Shares to be issued under this Agreement pursuant to the terms
of the Restated Articles, (b) the conversion privileges of the Notes and/or the SAFEs, and (c) the securities and rights described in
Section 2.2.4 of this Agreement.

 

    3 

     

    

 

2.3             
Subsidiaries. The Company does not currently own or control, directly or indirectly, any interest in any other corporation,
partnership, trust, joint venture, limited liability company, association, or other business entity. The Company is not a participant
in any joint venture, partnership or similar arrangement.

 

2.4             
Authorization. All corporate action has been taken, or will be taken prior to the Closing, on the part of the Board
and shareholders that is necessary for the authorization, execution and delivery of this Agreement by the Company and the performance
by the Company of the obligations to be performed by the Company as of the date hereof under this Agreement. This Agreement, when executed
and delivered by the Company, shall constitute valid and legally binding obligations of the Company, enforceable against the Company in
accordance with its terms except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance,
or other laws of general application relating to or affecting the enforcement of creditors’ rights generally, or (b) as limited
by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

 

2.5             
Valid Issuance of Shares. The Shares, when issued, sold and delivered in accordance with the terms and for the consideration
set forth in this Agreement, will be duly authorized, validly issued, fully paid and nonassessable and free of restrictions on transfer
other than restrictions on transfer under this Agreement, applicable state and federal securities laws and liens or encumbrances created
by or imposed by a Purchaser. Based in part on the accuracy of the representations of the Purchasers in Section 3 of this Agreement and
subject to filings pursuant to Regulation D of the Securities Act of 1933, as amended (the “Securities Act”),
and applicable state securities laws, the offer, sale and issuance of the Shares to be issued pursuant to and in conformity with the terms
of this Agreement and the issuance of the Common Stock, if any, to be issued upon conversion thereof for no additional consideration and
pursuant to the Restated Articles, will be issued in compliance with all applicable federal and state securities laws. The Common Stock
issuable upon conversion of the Shares has been duly reserved for issuance, and upon issuance in accordance with the terms of the Restated
Articles, will be duly authorized, validly issued, fully paid and nonassessable and free of restrictions on transfer other than restrictions
on transfer under this Agreement, applicable federal and state securities laws and liens or encumbrances created by or imposed by a Purchaser.
Based in part upon the representations of the Purchasers in Section 3 of this Agreement, and subject to filings pursuant to Regulation
D of the Securities Act and applicable state securities laws, the Common Stock issuable upon conversion of the Shares will be issued in
compliance with all applicable federal and state securities laws.

 

2.6             
Litigation. There is no pending action, suit, proceeding, arbitration, mediation, complaint, claim, charge or investigation
before any court, arbitrator, mediator or governmental body or, to the Company’s knowledge, currently threatened in writing (a)
against the Company or (b) against any consultant, officer, director or key employee of the Company arising out of his or her consulting,
employment or board relationship with the Company or that could otherwise materially impact the Company.

 

    4 

     

    

 

2.7             
Intellectual Property. The Company owns or possesses or believes it can acquire on commercially reasonable terms sufficient
legal rights to all Intellectual Property (as defined below) that is necessary to the conduct of the Company’s business as now conducted
and as presently proposed to be conducted (the “Company Intellectual Property”) without any violation or infringement
(or in the case of third-party patents, patent applications, trademarks, trademark applications, service marks, or service mark applications,
without any violation or infringement known to the Company) of the rights of others. No product or service marketed or sold (or proposed
to be marketed or sold) by the Company violates or, to the Company’s knowledge, will violate any license or infringes or will infringe
any rights to any patents, patent applications, trademarks, trademark applications, service marks, trade names, copyrights, trade secrets,
licenses, domain names, mask works, information and proprietary rights and processes (collectively, “Intellectual Property”)
of any other party, except that with respect to third-party patents, patent applications, trademarks, trademark applications, service
marks, or service mark applications the foregoing representation is made to the Company’s knowledge only. Other than with respect
to commercially available software products under standard end-user object code license agreements, there is no outstanding option, license,
agreement, claim, encumbrance or shared ownership interest of any kind relating to the Company Intellectual Property, nor is the Company
bound by or a party to any options, licenses or agreements of any kind with respect to the Intellectual Property of any other person.
The Company has not received any written communications alleging that the Company has violated or, by conducting its business, would violate
any of the Intellectual Property of any other person.

 

2.8             
Employee and Consultant Matters. Each current and former employee, consultant and officer of the Company has executed
an agreement with the Company regarding confidentiality and proprietary information substantially in the form or forms made available
to the Purchaser and/or counsel for the Purchasers. No current or former employee or consultant has excluded works or inventions from
his or her assignment of inventions pursuant to such agreement. To the Company’s knowledge, no such employees or consultants is
in violation thereof. To the Company’s knowledge, none of its employees is obligated under any judgment, decree, contract, covenant
or agreement that would materially interfere with such employee’s ability to promote the interest of the Company or that would interfere
with such employee’s ability to promote the interests of the Company or that would conflict with the Company’s business. To
the Company’s knowledge, all individuals who have purchased unvested shares of the Company’s Common Stock have timely filed
elections under Section 83(b) of the Internal Revenue Code of 1986, as amended.

 

2.9             
Compliance with Other Instruments. The Company is not in violation or default (a) of any provisions of the Restated
Articles or Bylaws, (b) of any judgment, order, writ or decree of any court or governmental entity, (c) under any agreement, instrument,
contract, lease, note, indenture, mortgage or purchase order to which it is a party that is required to be listed on the Disclosure Schedule,
or, (d) to its knowledge, of any provision of federal or state statute, rule or regulation materially applicable to the Company. The execution,
delivery and performance of this Agreement and the consummation of the transactions contemplated by this Agreement will not result in
any such violation or default, or constitute, with or without the passage of time and giving of notice, either (i) a default under any
such judgment, order, writ, decree, agreement, instrument, contract, lease, note, indenture, mortgage or purchase order or (ii) an event
which results in the creation of any lien, charge or encumbrance upon any assets of the Company or the suspension, revocation, forfeiture,
or nonrenewal of any material permit or license applicable to the Company.

 

    5 

     

    

 

2.10         
Title to Property and Assets. The Company owns its properties and assets free and clear of all mortgages, deeds of trust,
liens, encumbrances and security interests except for statutory liens for the payment of current taxes that are not yet delinquent and
liens, encumbrances and security interests which arise in the ordinary course of business and which do not affect material properties
and assets of the Company. With respect to the property and assets it leases, the Company is in material compliance with each such lease.

 

2.11         
Agreements. Except for this Agreement, there are no agreements, understandings, instruments, contracts or proposed transactions
to which the Company is a party that involve (a) obligations (contingent or otherwise) of, or payments to, the Company in excess
of $100,000 (excluding, for avoidance of doubt, any Notes or SAFEs converting into Shares pursuant to this Agreement), (b) the license
of any Intellectual Property to or from the Company other than licenses with respect to commercially available software products under
standard end-user object code license agreements or standard customer terms of service and privacy policies for Internet sites, (c) the
grant of rights to manufacture, produce, assemble, license, market, or sell its products to any other person, or that limit the Company’s
exclusive right to develop, manufacture, assemble, distribute, market or sell its products, or (d) indemnification by the Company with
respect to infringements of proprietary rights other than standard customer or channel agreements (each, a “Material Agreement”).
The Company is not in material breach of any Material Agreement. Each Material Agreement is in full force and effect and is enforceable
by the Company in accordance with its respective terms, except as may be limited by (i) applicable bankruptcy, insolvency, reorganization
or others laws of general application relating to or affecting the enforcement of creditors’ rights generally, or (ii) the effect
of rules of law governing the availability of equitable remedies.

 

2.12         
Liabilities. The Company has no liabilities or obligations, contingent or otherwise, in excess of $100,000 individually
or $500,000 in the aggregate (excluding, for avoidance of doubt, any Notes or SAFEs converting into Shares pursuant to this Agreement).

 

3.                 
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS. Each Purchaser hereby represents and warrants to the
Company, severally and not jointly, as follows.

 

3.1             
Authorization. The Purchaser has full power and authority to enter into this Agreement. This Agreement, when executed
and delivered by the Purchaser, will constitute valid and legally binding obligations of the Purchaser, enforceable in accordance with
their terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any
other laws of general application relating to or affecting the enforcement of creditors’ rights generally, or (b) the effect of
rules of law governing the availability of equitable remedies.

 

3.2             
Purchase Entirely for Own Account. This Agreement is made with the Purchaser in reliance upon the Purchaser’s
representation to the Company, which by the Purchaser’s execution of this Agreement, the Purchaser hereby confirms, that the Shares
to be acquired by the Purchaser will be acquired for investment for the Purchaser’s own account, not as a nominee or agent, and
not with a view to the resale or distribution of any part thereof, and that the Purchaser has no present intention of selling, granting
any participation in, or otherwise distributing the same. By executing this Agreement, the Purchaser further represents that the Purchaser
does not presently have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participations
to such person or to any third person, with respect to any of the Shares. The Purchaser has not been formed for the specific purpose of
acquiring the Shares.

 

    6 

     

    

 

3.3             
Disclosure of Information. The Purchaser has had an opportunity to discuss the Company’s business, management,
financial affairs and the terms and conditions of the offering of the Shares with the Company’s management. Nothing in this Section
3, including the foregoing sentence, limits or modifies the representations and warranties of the Company in Section 2 of this Agreement
or the right of the Purchasers to rely thereon.

 

3.4             
Restricted Securities. The Purchaser understands that the Shares have not been, and will not be, registered under the
Securities Act, by reason of a specific exemption from the registration provisions of the Securities Act which depends upon, among other
things, the bona fide nature of the investment intent and the accuracy of the Purchaser’s representations as expressed herein. The
Purchaser understands that the Shares are “restricted securities” under applicable United States federal and state securities
laws and that, pursuant to these laws, the Purchaser must hold the Shares indefinitely unless they are registered with the Securities
and Exchange Commission and qualified by state authorities or an exemption from such registration and qualification requirements is available.
The Purchaser acknowledges that the Company has no obligation to register or qualify the Shares, or the Common Stock into which it may
be converted, for resale. The Purchaser further acknowledges that if an exemption from registration or qualification is available, it
may be conditioned on various requirements including, but not limited to, the time and manner of sale, the holding period for the Shares,
and on requirements relating to the Company which are outside of the Purchaser’s control, and which the Company is under no obligation
and may not be able to satisfy.

 

3.5             
No Public Market. The Purchaser understands that no public market now exists for the Shares, and that the Company has
made no assurances that a public market will ever exist for the Shares.

 

3.6             
Legends. The Purchaser understands that the Shares and any securities issued in respect of or exchange for the Shares,
may bear any one or more of the following legends: (a) any legend set forth in, or required by, this Agreement; (b) any legend required
by the securities laws of any state to the extent such laws are applicable to the Shares represented by the certificate so legended; and
(c) the following legend:

 

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

 

    7 

     

    

 

3.7             
Accredited and Sophisticated Investor. The Purchaser is an accredited investor as defined in Rule 501(a) of Regulation
D promulgated under the Securities Act. The Purchaser is an investor in securities of companies in the development stage and acknowledges
that Purchaser is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial
or business matters that it is capable of evaluating the merits and risks of the investment in the Shares. If other than an individual,
Purchaser also represents it has not been organized for the purpose of acquiring the Shares.

 

3.8             
No General Solicitation. Neither the Purchaser nor any of its officers, directors, employees, agents, shareholders or
partners has either directly or indirectly, including through a broker or finder (a) engaged in any general solicitation with respect
to the offer and sale of the Shares, or (b) published any advertisement in connection with the offer and sale of the Shares.

 

3.9             
Exculpation Among Purchasers. The Purchaser acknowledges that it is not relying upon any person, other than the Company
and its officers and directors, in making its investment or decision to invest in the Company. The Purchaser agrees that neither any Purchaser
nor the respective controlling persons, officers, directors, partners, agents, or employees of any Purchaser shall be liable to any other
Purchaser for any action heretofore taken or omitted to be taken by any of them in connection with the purchase of the Shares.

 

3.10         
Residence. If the Purchaser is an individual, then the Purchaser resides in the state identified in the address of the
Purchaser set forth on Exhibit A; if the Purchaser is a partnership, corporation, limited liability company or other entity, then
the office or offices of the Purchaser in which its principal place of business is identified in the address or addresses of the Purchaser
set forth on Exhibit A.

 

3.11         
Consent to Convertible Security Conversion and Termination. Each Purchaser, to the extent that such Purchaser, as set
forth on the Schedule of Purchasers, is a holder of any Note or SAFE being converted and/or cancelled in consideration of the issuance
hereunder of Shares to such Purchaser, hereby agrees that the entire amount owed to such Purchaser under such Note and/or SAFE is being
tendered to the Company in exchange for the applicable Shares set forth on the Schedule of Purchasers, and effective upon the Company’s
and such Purchaser’s execution and delivery of this Agreement, without any further action required by the Company or such Purchaser,
such Note and/or SAFE and all obligations set forth therein shall be immediately deemed repaid in full and terminated in their entirety,
including, but not limited to, any security interest effected therein, notwithstanding anything to the contrary in such Note and/or SAFE.

 

    8 

     

    

 

4.                 
COVENANTS OF THE COMPANY.

 

4.1             
Information Rights.

 

4.1.1       
Basic Financial Information. The Company will furnish to each Purchaser which requires such information pursuant to its
organizational documents when available (1) annual unaudited financial statements for each fiscal year of the Company (starting with the
fiscal year ending December 31, 2019), including an unaudited balance sheet as of the end of such fiscal year, an unaudited statement
of operations and an unaudited statement of cash flows of the Company for such year, all prepared in accordance with generally accepted
accounting principles and practices; and (2) quarterly unaudited financial statements for each fiscal quarter of the Company (except the
last quarter of the Company’s fiscal year), including an unaudited balance sheet as of the end of such fiscal year, an unaudited
statement of operations and an unaudited statement of cash flows of the Company for such quarter, all prepared in accordance with generally
accepted accounting principles and practices, subject to changes resulting from normal year-end audit adjustments. If the Company has
audited records of any of the foregoing, it shall provide those in lieu of the unaudited versions.

 

4.1.2       
Confidentiality. Anything in this Agreement to the contrary notwithstanding, no Purchaser by reason of this Agreement shall
have access to any trade secrets or confidential information of the Company. The Company shall not be required to comply with any information
rights in respect of any Purchaser whom the Company reasonably determines to be a competitor or an officer, employee, director or holder
of one percent (1%) or more of a competitor. Each Purchaser agrees that such Purchaser will keep confidential and will not disclose, divulge,
or use for any purpose (other than to monitor its investment in the Company) any confidential information obtained from the Company pursuant
to the terms of this Agreement other than to (i) any of the Purchaser’s attorneys, accountants, consultants, and other professionals,
to the extent necessary to obtain their services in connection with monitoring the Purchaser’s investment in the Company, or (ii)
an Purchaser’s members, constituent partners or members who are bound by a written obligation of confidentiality.

 

4.2             
Additional Rights and Obligations. If the Company issues securities in its next equity financing after the date hereof
(the “Next Financing”) that provide all such future investors other contractual terms such as registration rights,
the Company shall provide substantially equivalent rights to the Purchasers with respect to the Shares (with appropriate adjustment for
economic terms or other contractual rights), subject to such Purchaser’s execution of any documents, including, if applicable, investor
rights, co-sale, voting, and other agreements, executed by the investors purchasing securities in the Next Financing (such documents,
the “Next Financing Documents”). Any Major Purchaser will remain a Major Purchaser for all purposes in the Next
Financing Documents to the extent such concept exists. Notwithstanding anything herein to the contrary, subject to the provisions of Section
7.16, upon the execution and delivery of the Next Financing Documents by Purchasers holding a majority of the then-outstanding Shares
held by all Purchasers, this Agreement (excluding any then-existing and outstanding obligations) shall be amended and restated by and
into such Next Financing Documents and shall be terminated and of no further force or effect.

 

    9 

     

    

 

4.3             
Assignment of Company’s Preemptive Rights. The Company shall obtain at or prior to the Initial Closing, and shall
maintain, a right of first refusal with respect to transfers of shares of Common Stock by each holder thereof, subject to certain standard
exceptions.

 

4.4             
Reservation of Common Stock. The Company shall at all times reserve and keep available, solely for issuance and delivery
upon the conversion of the Shares, regardless of whether or not all such Shares have been issued at such time.

 

5.                 
RESTRICTIONS ON TRANSFER.

 

5.1             
Limitations on Disposition. Each person owning of record shares of Common Stock of the Company issued or issuable pursuant
to the conversion of the Shares and any shares of Common Stock of the Company issued as a dividend or other distribution with respect
thereto or in exchange therefor or in replacement thereof (collectively, the “Securities”) or any assignee of
record of Securities (each such person, a “Holder”) shall not make any disposition of all or any portion of
any Securities unless:

 

(a)       there
is then in effect a registration statement under the Securities Act, covering such proposed disposition and such disposition is made in
accordance with such registration statement; or

 

(b)       such
Holder has notified the Company of the proposed disposition and has furnished the Company with a statement of the circumstances surrounding
the proposed disposition, and, at the expense of such Holder or its transferee, with an opinion of counsel, reasonably satisfactory to
the Company, that such disposition will not require registration of such securities under the Securities Act.

 

Notwithstanding the provisions
of Sections 5.1(a) and (b), no such registration statement or opinion of counsel will be required: (i) for any transfer of any Securities
in compliance with the Securities and Exchange Commission’s Rule 144 or Rule 144A, or (ii) for any transfer of any Securities by
a Holder that is a partnership, limited liability company, a corporation, or a venture capital fund to (A) a partner of such partnership,
a member of such limited liability company, or shareholder of such corporation, (B) an affiliate of such partnership, limited liability
company or corporation (including, any affiliated investment fund of such Holder), (C) a retired partner of such partnership or a retired
member of such limited liability company, (D) the estate of any such partner, member, or shareholder, or (iii) for the transfer without
additional consideration or at no greater than cost by gift, will, or intestate succession by any Holder to the Holder’s spouse
or lineal descendants or ancestors or any trust for any of the foregoing; provided that, in the case of clauses (ii) and (iii),
the transferee agrees in writing to be subject to the terms of this Agreement to the same extent as if the transferee were an original
Purchaser under this Agreement. Any disposition of Shares in violation of this Agreement shall be void.

 

5.2             
“Market Stand-Off” Agreement. Each Holder hereby agrees that, during the Standoff Period, such Holder will
not, without the prior written consent of the Company or the managing underwriter,

 

    10 

     

    

 

(a)              
lend, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell,
grant any option, right, or warrant to purchase or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock,
or any securities convertible into or exercisable or exchangeable (directly or indirectly) for Common Stock, held immediately before the
effective date of the registration statement for such offering; or

 

(b)               enter
into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of
such securities, whether any such transaction described in clause (a) or (b) above is to be settled by delivery of Common Stock or
other securities, in cash, or otherwise.

 

The foregoing provisions of this Section 5.2 shall not apply to the sale of any shares to
an underwriter pursuant to an underwriting agreement, and shall be applicable to the Holders only if all officers, directors, and
shareholders individually owning more than one percent (1%) of the Company’s outstanding Common Stock (after giving effect to
conversion into Common Stock of all outstanding Preferred Stock) are similarly bound. For purposes of this Section 5.2, the term
 “Company” shall include any wholly-owned subsidiary of the Company into which the Company merges or consolidates. In
order to enforce the foregoing covenant, the Company shall have the right to place restrictive legends on the certificates
representing the shares subject to this Section 5.2 and to impose stop transfer instructions with respect to such shares until the
end of such period. The underwriters in connection with such registration are intended third-party beneficiaries of this Section 5.2
and shall have the right, power, and authority to enforce the provisions hereof as though they were a party hereto. Each Holder
further agrees to execute such agreements as may be reasonably requested by the underwriters in connection with such registration
that are consistent with this Section 5.2 or that are necessary to give further effect thereto. For the purposes hereof,
 “Standoff Period” means the period commencing on the date of the
final prospectus relating to an underwritten public offering of the Company’s Common Stock under the Securities Act and ending
on the date specified by the Company and the managing underwriter (such period not to exceed one hundred eighty (180) days) (or such
other period as may be requested by the Company or an underwriter to accommodate regulatory restrictions on (i) the publication
or other distribution of research reports and (ii) analyst recommendations and opinions, including, but not limited to, the
restrictions contained in FINRA Rule 2711(f)(4) or NYSE Rule 472(f)(4), or any successor provisions or amendments
thereto).

  

6.                 
Participation RIGHT.

 

6.1             
General. Each Major Purchaser has the right of first refusal to purchase such Major Purchaser’s Pro Rata Share
(as defined below) of all (or any part) of any New Securities (as defined in Section 6.2 below) that the Company may from time to time
issue after the date of this Agreement, provided, however, such Major Purchaser shall have no right to purchase any such New Securities
if such Major Purchaser cannot demonstrate to the Company’s reasonable satisfaction that such Major is at the time of the proposed
issuance of such New Securities an “accredited investor” as such term is defined in Regulation D under the Securities Act.
A Major Purchaser’s “Pro Rata Share” for purposes of this right of first refusal is the ratio of (a) the
number of shares of the Company’s Common Stock issued or issuable upon conversion of the Shares owned by such Major Purchaser, to
(b) a number of shares of Common Stock of the Company equal to the sum of (1) the total number of shares of Common Stock of the Company
then outstanding plus (2) the total number of shares of Common Stock of the Company into which all then outstanding shares of Preferred
Stock of the Company are then convertible plus (3) the number of shares of Common Stock of the Company reserved for issuance under any
stock purchase and stock option plans of the Company and outstanding warrants. For the purposes hereof, a “Major Purchaser”
shall mean that a Purchaser holds Shares with an aggregate original purchase price of at least $250,000 (as adjusted for stock splits
and the like).

 

    11 

     

    

 

6.2             
New Securities. “New Securities” shall mean any Common Stock or Preferred Stock of the Company,
whether now authorized or not, and rights, options or warrants to purchase such Common Stock or Preferred Stock, and securities of any
type whatsoever that are, or may become, convertible or exchangeable into such Common Stock or Preferred Stock; provided, however, that
the term “New Securities” does not include: (a) capital stock issued pursuant to stock dividends, stock splits or similar
transactions; (b) capital stock issuable upon conversion, exchange or exercise of convertible, exchangeable or exercisable securities
outstanding as of the date hereof including, without limitation, warrants, notes, Safes or options; (c) capital stock issued as a dividend
or distribution with respect to the Preferred Stock (or any series thereof); (d) Common Stock issued or issuable to employees, consultants,
officers or directors of the Company directly or pursuant to a stock option plan or restricted stock plan approved by the Board; (e) Common
Stock issued in an initial public offering of the Company’s Common Stock to the public pursuant to an effective registration statement
filed under the Securities Act; (f) capital stock, or warrants or options to purchase capital stock, issued in connection with bona fide
acquisitions, mergers or similar transactions, provided that such issuances are approved by the Board; (g) capital stock, or options or
warrants to purchase capital stock, issued to financial institutions, equipment lessors, brokers or similar persons in connection with
commercial credit arrangements, equipment financings, commercial property lease transactions or similar transactions, that are approved
by the Board; (h) capital stock issued or issuable to an entity as a component of any business relationship with such entity primarily
for the purpose of (1) joint venture, technology licensing or development activities, (2) distribution, supply or manufacture of the Company’s
products or services or (3) any other arrangements involving vendors, customers, or other corporate partners, the terms of which business
relationship with such entity are approved by the Board; (i) Common Stock issued or issuable upon conversion of Preferred Stock; (j) Common
Stock issued or issuable with the affirmative vote of the holders of at least a majority of the then outstanding Shares, voting together
as a class on an as-converted basis; or (k) any securities issued pursuant to this Agreement, or any capital stock issued or issuable
upon conversion thereof.

 

6.3             
Procedures. If the Company proposes to undertake an issuance of New Securities, it shall give notice to each Major Purchaser
of its intention to issue New Securities (the “Notice”), describing the type of New Securities and the price
and the general terms upon which the Company proposes to issue the New Securities. Each Major Purchaser will have (10) days from the date
of notice, to agree in writing to purchase such Major Purchaser’s Pro Rata Share of such New Securities for the price and upon the
general terms specified in the Notice by giving written notice to the Company and stating therein the quantity of New Securities to be
purchased (not to exceed such Major Purchaser’s Pro Rata Share).

 

6.4             
Failure to Exercise. If the Major Purchasers fail to exercise in full the right of first refusal within the 10-day period,
then the Company will have one hundred twenty (120) days thereafter to sell the New Securities with respect to which the Major Purchasers’
rights of first refusal hereunder were not exercised, at a price and upon general terms not materially more favorable to the purchasers
thereof than specified in the Company’s Notice to the Major Purchasers. If the Company has not issued and sold the New Securities
within the 120-day period, then the Company shall not thereafter issue or sell any New Securities without again first offering those New
Securities to the Major Purchasers pursuant to this Section 6.

 

    12 

     

    

 

7.                 
GENERAL PROVISIONS.

 

7.1             
Successors and Assigns. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the parties. Nothing in this Agreement, express or implied, is intended to confer upon any party
other than the parties to this Agreement or their respective successors and assigns any rights, remedies, obligations, or liabilities
under or by reason of this Agreement, except as expressly provided in this Agreement. No Purchaser may transfer Shares unless each transferee
agrees to be bound by the terms of this Agreement.

 

7.2             
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California,
without reference to principles of conflicts of laws or choice of laws. Each party agrees that service of process on them in any such
action, suit or proceeding may be effected by the means by which notices are to be given to it under this Agreement.

 

7.3             
Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument. Counterparts may be delivered via facsimile, electronic mail (including
pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method
and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

 

7.4             
Titles and Subtitles. The titles, captions and headings of this Agreement are included for ease of reference only and
will be disregarded in interpreting or construing this Agreement.

 

7.5             
Notices. All notices and other communications given or made pursuant to this Agreement shall be in writing and shall
be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile
if sent during normal business hours of the recipient, and if not so confirmed, then on the next business day, (c) five (5) days after
having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to
the respective parties at their address as set forth on the signature page or on Exhibit A, or to such e-mail address, facsimile
number or address as subsequently modified by written notice given in accordance with this Section 7.5. If notice is given to the Company,
a copy (which shall not constitute notice) shall also be sent to Procopio, Cory, Hargreaves & Savitch LLP, 1117 S. California
Avenue, Suite 200, Palo Alto, CA 94304, Attn: Roger C. Rappoport, Esq., email roger.rappoport@procopio.com.

 

    13 

     

    

 

7.6             
No Finder’s Fees. Each party severally represents to the other parties that it neither is nor will be obligated
for any finder’s fee or commission in connection with this transaction. Each Purchaser shall indemnify, defend, and hold harmless
the Company from any liability for any commission or compensation in the nature of a finder’s or broker’s fee arising out
of this transaction (and the costs and expenses of defending against such liability or asserted liability) for which the Purchaser
or any of its officers, employees, or representatives is responsible. The Company shall indemnify, defend, and hold harmless each Purchaser
from any liability for any commission or compensation in the nature of a finder’s or broker’s fee arising out of this
transaction (and the costs and expenses of defending against such liability or asserted liability) for which the Company or any of its
officers, employees or representatives is responsible.

 

7.7             
Attorneys’ Fees. If any action at law or in equity (including arbitration) is necessary to enforce or interpret
the terms of this Agreement, the prevailing party will be entitled to reasonable attorneys’ fees, costs, and necessary disbursements
in addition to any other relief to which the party may be entitled. Each party shall pay all costs and expenses that it incurs with respect
to the negotiation, execution, delivery, and performance of the Agreement.

 

7.8             
Amendments and Waivers. Except as specified in Section 1.2.2, any term of this Agreement may be amended, terminated
or waived only with the written consent of the Company and the Purchasers holding a majority of the then-outstanding Shares (or Common
Stock issued on conversion thereof). Any amendment or waiver effected in accordance with this Section 7.8 will be binding upon the Purchasers,
each transferee of the Shares (or the Common Stock issuable upon conversion thereof) or Common Stock from a Purchaser and each future
holder of all such securities, and the Company.

 

7.9             
Severability. In case any one or more of the provisions contained in this Agreement shall, for any reason, be judicially
determined to be invalid, illegal or unenforceable in any respect, (i) the remaining terms and provisions hereof shall be unimpaired and
shall remain in full force and effect, and (ii) the invalid or unenforceable provision or term shall be replaced by a term or provision
that is valid and enforceable and that comes closest to expressing the intention of such invalid or unenforceable term or provision, and,
if the foregoing provision of this clause (ii) is not permitted pursuant to applicable law, then (iii) this Agreement shall be construed
as if such invalid, illegal or unenforceable provision had never been contained herein.

 

7.10         
Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any party under this Agreement,
upon any breach or default of any other party under this Agreement, will impair any such right, power or remedy of such non-breaching
or non-defaulting party nor will it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in
any similar breach or default thereafter occurring; nor will any waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of
any party of any breach or default under this Agreement, or any waiver on the part of any party of any provisions or conditions of this
Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under
this Agreement or by law or otherwise afforded to any party, are cumulative and not alternative.

 

    14 

     

    

 

7.11         
Entire Agreement. This Agreement (and the Exhibits hereto), constitutes the entire agreement of the parties with regard
to the subject matter hereof and supercedes any and all prior negotiations, correspondence, understandings and agreements among the parties
regarding the subject matter hereof, whether oral or written, including, without limitation, that certain Summary of Terms For Private
Placement of Series Seed Preferred Stock of Tivic Health Systems Inc. delivered, or made available, to Investors.

 

7.12         
Adjustments for Stock Splits, Etc. Wherever in this Agreement there is a reference to a specific number of shares of
Common Stock or Preferred Stock of the Company of any class or series, then, upon the occurrence of any subdivision, combination or stock
dividend of such class or series of stock, the specific number of shares so referenced in this Agreement shall automatically be proportionally
adjusted to reflect the effect on the outstanding shares of such class or series of stock by such subdivision, combination or stock dividend.

 

7.13         
Construction. The Company and the Purchasers have participated jointly in the negotiation and drafting of this Agreement.
If an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties
hereto and no presumption or burden of proof shall arise favoring or disfavoring any party because of the authorship of any provision
of this Agreement. The words “include,” “includes,” and “including” shall be deemed to be followed
by “without limitation.” Pronouns in masculine, feminine, and neuter genders shall be construed to include any other gender,
and words in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. The words
 “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder,” and words of
similar import refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited. Any reference herein
to “day” or “days” shall, unless otherwise provided for, mean a calendar day or calendar days.

 

7.14         
Waiver of Conflicts. Each party to this Agreement acknowledges that Procopio, Cory, Hargreaves & Savitch LLP (“Procopio”),
outside general counsel to the Company, has in the past performed and is or may now or in the future represent one or more of the Purchasers
or their affiliates in matters unrelated to the transactions contemplated by this Agreement (the “Financing”),
including representation of such Purchasers or their affiliates in matters of a similar nature to the Financing. The applicable rules
of professional conduct require that Procopio inform the parties hereunder of this representation and obtain their consent. Procopio has
served as outside general counsel to the Company and has negotiated the terms of the Financing solely on behalf of the Company. It is
the belief of Procopio that these terms and conditions represent an arm’s length transaction between the Company and the Purchasers.
Purchasers have been, or have been granted the opportunity to be, represented by independent legal counsel regarding the terms of the
Financing. The Company and each Purchaser hereby (a) acknowledge that they have had an opportunity to ask for and have obtained information
relevant to such representation, including disclosure of the reasonably foreseeable adverse consequences of such representation; (b) acknowledge
that with respect to the Financing, Procopio has represented solely the Company, and not any Purchaser or any shareholder, director or
employee of the Company or any Purchaser; and (c) gives its informed consent to Procopio’s representation of the Company in the
Financing.

 

    15 

     

    

 

7.15         
Separability of Agreements. The Company’s agreement with each of the Purchasers is a separate agreement and the
sale of the Shares to each of the Purchasers is a separate sale. Unless otherwise expressly provided herein, the rights of each Purchaser
hereunder are several rights, not rights jointly held with any of the other Purchasers. Any invalidity, illegality or limitation on the
enforceability of the Agreement or any part thereof, by any Purchaser, whether arising by reason of the law of the respective Purchaser’s
domicile or otherwise, shall in no way affect or impair the validity, legality or enforceability of this Agreement with respect to other
Purchasers.

 

7.16         
Termination. Unless terminated earlier pursuant to the terms of this Agreement, (x) the rights, duties and obligations
under Sections 4 and 6 will terminate immediately prior to the closing of the Company’s initial public offering of Common Stock
pursuant to an effective registration statement filed under the Securities Act, (y) notwithstanding anything to the contrary herein, this
Agreement (excluding any then-existing obligations) will terminate upon the closing of a Deemed Liquidation Event as defined in the Company’s
Restated Articles, as amended from time to time and (z) notwithstanding anything to the contrary herein, Section 1, Section 4.1.2 and
Section 7 will survive any termination of this Agreement.

 

[Page
Intentionally Left Blank]

 

    16 

     

    

 

IN WITNESS WHEREOF, the parties
hereto have executed this Agreement as of the date set forth in the first paragraph hereof.

 

	 	COMPANY:  
	 	 
	 	TIVIC HEALTH SYSTEMS INC.
	 	a California corporation
	 	 
	 	By:	/s/ Jennifer Ernst
	 	 	Jennifer Ernst
	 	 	Chief Executive Officer
	 	 
	 	Address: 750 Menlo Ave. Suite 200
	 	Menlo Park, California 94025
	 	Attn: Chief Executive Officer
	 	Email Address: jennifer.ernst@tivichealth.com

 

     

     

    

 

IN WITNESS WHEREOF, the parties
hereto have executed this Agreement as of the date set forth in the first paragraph hereof.

 

 

PURCHASERS:

 

	If Purchaser is a Corporation, Partnership or Other Entity	 	If Purchaser is an Individual:
	 	 	 
	 	 	 
	Name of Entity	 	Print Name of Individual
	 	 	 
	 	 	 
	Signature of Authorized Person 	 	Signature of Individual
	 	 	 
	 	 	 
	Print Name of Authorized Person	 	Print Name of Individual (If more than one signatory)
	 	 	 
	 	 	 
	Title	 	Signature of Individual (If more than one signatory)
	 	 	 
	Telephone (Day):	 	 	Telephone (Day):	 
	 	 	 
	Facsimile:	 	 	Facsimile:	 
	 	 	 
	Email Address:	 	 	Email Address:	 
	 	 	 

  

     

     

    

 

EXHIBIT A

 

SCHEDULE
OF PURCHASERS

 

Initial Closing

 

     

     

    

 

 

EXHIBIT B

 

RESTATED
ARTICLES

 

[Attached]

 

     

     

    

 

EXHIBIT C

 

VOTING
AGREEMENT

 

[Attached]

 

     

     

    

 

EXHIBIT D

 

DISCLOSURE
SCHEDULE

 

This Disclosure Schedule (this
 “Disclosure Schedule”) is delivered by the Company in connection with the sale of the Shares on or about the
date of the Agreement by the Company.

 

This Disclosure Schedule is
arranged in sections corresponding to the numbered and lettered sections and subsections contained in Section 2 of the Agreement, and
the disclosures in any section or subsection of this Disclosure Schedule shall qualify other sections and subsections in Section 2 of
the Agreement to the extent it is readily apparent from a reading of the disclosure that such disclosure is applicable to such other sections
and subsections. Nothing in this Disclosure Schedule is intended to broaden the scope of any representation or warranty contained in the
Agreement or to create any covenant. Inclusion of any item in this Disclosure Schedule (1) does not represent a determination that such
item is material or establish a standard of materiality, (2) does not represent a determination that such item did not arise in the ordinary
course of business, (3) does not represent a determination that the transactions contemplated by the Agreement require the consent of
third parties, and (4) shall not constitute, or be deemed to be, an admission to any third party concerning such item.

 

Unless otherwise defined herein,
any capitalized terms in this Disclosure Schedule have the same meanings assigned to those terms in the Agreement. Nothing in this Disclosure
Schedule constitutes an admission of any liability or obligation of the Company to any third party, or an admission against the Company’s
interests.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00331-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00331-of-00352.parquet"}]]