Document:

Drilling Rig Development and Management Agreement

 Exhibit 10.5 
  
 DRILL RIG DEVELOPMENT AND 
 MANAGEMENT AGREEMENT 
  
 THIS DRILL RIG
DEVELOPMENT AND MANAGEMENT AGREEMENT (“Agreement”) is entered into as of April 12, 2005 (“Effective Date”) by and between Verdisys, Inc., a California corporation (“VDYS”) and Advanced Drilling Services, LLC, a Delaware
limited liability company (“ADS”), otherwise herein referred to as the “Parties”. 
  
 WHEREAS, subject to the terms and conditions of this Agreement, ADS wishes to acquire and own an Abrasive Fluid Jetting Drill Rig (the “AFJ Rig”) built by VDYS and its vendors, the conceptual design of which
is attached as Exhibit A, which will be maintained, managed and operated by VDYS; 
  
 WHEREAS, ADS plans to fund the development and construction of the AFJ Rig for U.S. $1.2 million and VDYS shall build, maintain and operate the AFJ Rig for the benefit of the Parties subject to the terms and conditions hereunder;

  
 WHEREAS, VDYS is knowledgeable and experienced in the development and
operation of drill rigs similar to the AFJ Rig; and 
  
 WHEREAS, the purpose of
this Agreement is to set forth the responsibilities of the Parties; 
  
 THEREFORE,
for good and valuable consideration, the Parties agree as follows: 
  
 1. Term
of Agreement. 
  
 1.0 The Parties hereby agree that the term of this
Agreement shall terminate on the date that is ten years from the commissioning of the AFJ Rig. 
  
 1.2 Effective upon delivery of the Purchase Price, ADS shall hold the title to the AFJ Rig, subject to the rights of VDYS under this Agreement. ADS shall have the right to enter into a written security agreement that
would allow a lien to be placed on the AFJ Rig without the written prior consent of VDYS. ADS covenants and agrees that (i) the terms of such security agreement shall not place any material restrictions on the ability of VDYS to perform its
obligations under this Agreement or to otherwise utilize or deploy the AFJ Rig, (ii) the AFJ Rig shall not be used by ADS as collateral to support one or more obligations, the principal of which would exceed in the aggregate $1 million, and (iii)
ADS shall perform all obligations under any such security agreement (and any loan agreement, note or similar document) and there shall be no default, event of default or breach by ADS under the terms of such security agreement. 
  
 1.3 Subject to the rights of VDYS under this Agreement and the VDYS Licensing Agreement with
Alberta Energy Holdings (“AEH”), VDYS hereby grants ADS a non-exclusive sub-license to use its patented abrasive fluid jetting drill technology for the 

 
purposes of owning and operating the AFJ Rig solely in the event that VDYS for any reason ceases to act as operator of the AFJ Rig under this Agreement. Such
sub-license shall be limited to the operation of the specific AFJ Rig funded by this Agreement and shall remain in effect until the date that is 10 years from the Effective Date of this Agreement. As a condition to ADS’ obligations under this
Agreement, AEH shall execute the consent to the sub-license by VDYS of the abrasive fluid jetting drill technology to ADS pursuant to this Section 1.3 in the form attached hereto as Exhibit B. 
  
 1.4 The Effective Date of the Agreement shall be the date of receipt of the wire transfer
funding the consideration set forth in Section 2.1 herein. In the event that the Purchase Price is not funded by ADS on or before April 15, 2005, VDYS may terminate this Agreement. 
  
 2. Funding and Building Obligations. 
  
 2.1 ADS agrees to pay to VDYS the amount of U.S. $1.2 million (the “Purchase Price”) in cash by wire transfer for the development and construction of the AFJ
Rig and VDYS agrees to use commercially reasonable efforts to timely plan, manage and complete the building of the AFJ Rig according to the design and description attached as Exhibit A. The Purchase Price shall be held in a separate account
specifically designated as ADS funds advanced for the purchase of one AFJ Rig. VDYS shall disburse amounts from the ADS funds account as needed for the construction of the AFJ Rig provided that not less than 70% of the funds shall be paid from the
segregated ADS funds account directly to AFJ Rig suppliers, contractors and service providers related to the construction of the rig. 
  
 2.2 ADS agrees to sign and deliver any necessary documents and approvals required to provide VDYS with all legal and financial rights required to build, operate and
manage the AFJ Rig under this Agreement. 
  
 2.3 VDYS agrees to reimburse to ADS a
placement fee of 6% of the Purchase Price and reimburse to ADS unallocated expenses equal to 2% of the Purchase Price amount from the proceeds of the funding to VDYS. Such payment shall occur within 10 business days of payment by ADS of the Purchase
Price. 
  
 3. Operating Obligations. 
  
 3.1 At its’ own expense, VDYS shall be solely responsible for the management,
operation, maintenance, repair, overhaul, and upgrade of the AFJ Rig during the term of this Agreement and shall maintain the AFJ Rig in commercially operable condition during the term of this Agreement. 
  
 3.2 VDYS shall provide all planning, material procurement, manpower, transportation,
marketing & sales support, and operations supervision related to AFJ Rig operation as required for the conduct of commercial operations through the use of in-house labor and contract services. 

 3.3 VDYS shall prioritize drilling contracts on a commercially reasonable efforts basis to provide priority deployment of
the AFJ Rig ahead of other comparable equipment that may be operated by VDYS. In the event that the AFJ Rig is available for use, VDYS will use its commercially reasonable efforts to utilize the AFJ Rig. 
  
 3.4 VDYS shall provide an accounting, reporting & cash collection function for the AFJ
Rig within 10 business days of the end of each calendar quarter during the term of the Agreement. 
  
 3.5 VDYS shall comply with all laws & regulations relating to the development and operation of the AFJ Rig for the term of the Agreement. 
  
 3.6 VDYS assumes liability for all risk of loss and damage to the AFJ Rig. VDYS shall carry insurance on the AFJ Rig of such amounts and
types of coverage as are customary in the industry and comparable in coverage and amount to policies carried by VDYS covering its other equipment. VDYS shall list ADS as an additional insured under such policies covering the AFJ Rig. 
  
 3.7 VDYS shall indemnify, defend and hold ADS harmless from and against any and all
liability, judgments, costs, damages, claims or demands, including reasonable attorneys’ fees, arising out of VDYS’ operation and maintenance of the AFJ Rig, including but not limited to any breach by VDYS of its obligations under this
Agreement, third party claims and claims for employee liability, except to the extent arising out of the gross negligence or willful misconduct of ADS or any of its affiliates. If any such action or proceeding be brought against ADS, VDYS, upon
notice from ADS, shall defend such action or proceeding at its sole expense by counsel reasonably satisfactory to VDYS. ADS shall indemnify and hold VDYS harmless from and against any and all liability, judgments, costs, damages, claims or demands,
including reasonable attorney fees arising out of the wrongful acts or omissions of ADS or any breach by ADS of its obligations under this Agreement. 
  
 3.8 VDYS shall act at all times as a prudent operator of the AFJ Rig and maintain good oilfield practices. 
  
 3.9 VDYS shall adhere to U.S.-based generally accepted accounting practices (“GAAP”) concerning its financial statements (except
VDYS is entitled to calculate its obligations to ADS under Article 4 hereof on a cash basis), and shall, to the extent such rules become applicable to VDYS, comply in all material respect with the prevailing stock exchange rules. 
  
 3.10 ADS shall agree to remain in good standing under the laws of the State of Delaware and
to meet all its financial and legal obligations as they arise to the extent that the failure to remain in good standing or meet such obligations could reasonably be anticipated to impair the ownership or operations of the AFJ Rig. In the event that
ADS fails to timely meet such financial or legal obligations within 90 calendar days of when ADS is notified of its failure to meet its obligations, Verdisys shall have the option to purchase and take title to the AFJ Rig for $50,000 in cash and
then terminate this Agreement. 

 3.11 ADS shall agree not to sell, convey, transfer, assign or mortgage (except for liens permitted under Section 1.2) the
AFJ Rig to any third party without the prior written consent of VDYS, which consent shall not be unreasonably withheld. 
  
 4. Consideration.  
  
 4.1 In consideration of this Agreement, ADS shall fund $1.2 million to develop and construct the AFJ Rig and VDYS shall share the revenue generated from the AFJ Rig as
follows: 
  
 4.1.1 VDYS shall share Gross Revenues generated
before Payout on the basis of 20% to ADS and 80% to VDYS; 
  
 4.1.2 VDYS shall share Gross Revenues generated after Payout on the basis of 10% to ADS and 90% to VDYS. 
  
 4.2 “Payout” shall be defined as the aggregate payments made to ADS by VDYS through quarterly payments hereunder equal to the full amount of U.S. $1.2 million.

  
 4.3 “Gross Revenues” shall be defined as all cash revenues collected
by VDYS for any services attributable to the operation of the AFJ Rig, including, but not limited to, the provision of oilfield services for cash or the receipt of cash from sharing of production from joint ventures entered into by VDYS. 

 

	5.	Options under the Agreement. 

  
 5.1. Upon the completion of the ten-year operating period under this Agreement, and satisfactory performance by the Parties of their obligations under this Agreement,
VDYS shall have an option to purchase the AFJ Rig for a price of U.S. $50,000. Upon the closing of the purchase of the AFJ Rig by VDYS under its option to purchase, ADS will provide VDYS with full and complete title to and possession of the AFJ Rig,
without any liens, claims, or encumbrances. 
  
 5.2 In the event that VDYS builds
additional AFJ Rig units, ADS shall have the option to fund the development and construction of said AFJ Rig units under substantially the same terms and conditions as this Agreement (subject to such increases in the direct cost of construction in
excess of $1.2 million for such AFJ Rig units as are mutually acceptable to the parties), up to a maximum of four additional AFJ Rig units. 
  
 5.3 Execution of such options will be made in writing upon thirty calendar days notice from each Party. 
  
 6. Reporting and Cash Distributions, Rights of Audit. 
  
 6.1 On or before the 10th day of the beginning of each calendar quarter, VDYS shall make an accounting of operations for the previous calendar quarter and distribute cash 

 
based on revenues received in that period as provided in Section 4. At the end of each month, VDYS shall place into a separate account an amount of cash
distribution due to ADS for receipts collected by VDYS during that month. 
  
 6.2
In the event that any such reporting and/or cash distributions are more than sixty calendar days late, ADS shall have the right to terminate this Agreement and take possession of the AFJ Rig. 
  
 6.3 ADS shall have the right to audit VDYS books and records to the limited extent necessary
to confirm the obligations of VDYS under this Agreement annually during normal working hours in the month of August on reasonably prior notice by ADS, provided, however, that, in addition to the annual audit, ADS shall also have the right to audit
the foregoing books and records of VDYS upon completion or termination of this Agreement. 
  
 7. Taxes. 
  
 7.1 ADS shall be entitled to
take any of the accelerated depreciation and other tax benefits from investing in the AFJ Rig as it is entitled under applicable law. 
  
 7.2 Neither VDYS nor ADS shall be responsible for the other Parties’ federal, state or other taxes arising out of monies or other consideration provided between the
parties under this Agreement. 
  
 8. Scope of Agreement. 
  
 8.1 Except as stated herein, all prior or contemporaneous written or oral statement,
arrangements, or agreements regarding this Assignment are merged into and superseded by this Assignment. 
  
 8.2 None of the covenants or undertakings entered into in this Agreement shall be construed to create any legal relationship as between VDYS and the shareholders or lenders of ADS beyond the scope of this Agreement.
This Agreement shall not create a partnership for state law purposes or a partnership under applicable tax laws. 
  
 9. Representations and Warranties; Prevailing Law and Jurisdiction. 
  
 9.1 Each party represents and warrants to the other that it has full power and authority to enter into and perform its obligations hereunder and this Agreement does not
conflict with any articles of organization, bylaws, operating agreement or other governing document binding on such party. 
  
 9.2 This Agreement shall be construed and interpreted in accordance with the laws of Delaware. Jurisdiction for any dispute arising out of any term or matter related to
this Assignment shall be settled by binding arbitration according to the rules and procedures of the American Arbitration Association and shall be conducted in Houston, Texas. 

 10. Arms-Length Transaction 
  
 10.1 This Assignment is entered into as an arms-length transaction and the parties are independent contractors with respect to each other,
and nothing in this Assignment shall create or constitute a joint venture, partnership, agency or any similar relationship between the parties. 
  
 11. Confidentiality and Counterparts. 
  
 11.1 The execution documents shall be signed in two originals so that each Party may retain an original. 
  
 11.2 ADS hereby agrees not to publicly disclose the terms of this Agreement or information pertaining to the technology of the AFJ Rig,
except as may be required or compelled by law or legal process and VDYS agrees the same except as such disclosure may be required pursuant to its disclosure obligations as a public company under SEC and Stock Exchange rules. 
  
 11.3 ADS agrees to enter into a Non-Compete agreement with VDYS covering the abrasive jetting
business and technology to be effective for so long as VDYS operates and maintains the AFJ Rig in full compliance with the terms of this Agreement. 
  
 11.4 ADS agrees to comply with applicable laws, rules and rulings of the Securities and Exchange Commission, particularly as they relate to material insider information
pertaining to this Agreement. 
  
 11.5 The Parties have obtained all the necessary
approvals and consents to enter into this Agreement. 
  
 12. Notices

  
 12.1 Notices shall be delivered to the following Parties: 
  

			
	 VDYS:

	  	 ADS:

	Verdisys, Inc.	  	Advanced Drilling Services, LLC
	Attn - John O’Keefe	  	Attn – Eric McAfee
	14550 Torrey Chase Blvd,	  	10600 North De Anza Blvd,
	Suite 330	  	Suite 250
	Houston, TX 77014	  	Cupertino, CA 95014
	Ph: 281-453-2888	  	Ph: 408-873-0500 x. 301
	Fx: 281-453-2899	  	Fx: 408-873-0550

  

	13.	Miscellaneous 

  
 13.1 The failure or delay of either Party to enforce any of its rights or remedies under this Agreement shall in no way be construed to be a waiver of such rights or any other rights granted under this Agreement.

  
 13.2 VDYS shall not assign or transfer this Agreement or any rights or
obligations provided under this Agreement without the prior written consent of ADS. This Agreement shall be binding upon and inure to the benefit or and be binding upon the successors, assigns and administrators of the Parties. 

 13.3 The delay or non-performance in whole or in part by a party under this Agreement is not a breach of its obligations
under this Agreement to the extent such delay or non-performance is caused by a “Force Majeure Event.” As used in this Agreement, a Force Majeure Event means any war, flood, lightning, earthquake, fire, act of God, terrorist act, action of
any court or public authority, strike, or regulatory condition or event, where the delay or failure to perform is beyond the reasonable control of and not the fault of the non-performing party. 
  
 13.4 In the event that either party takes any action or initiates any proceeding to enforce
its rights under this Agreement, in addition to such other relief as may be granted, the prevailing party in such action or proceeding shall be entitled to recover from the other party all costs and expenses, including reasonable attorneys’
fees, incurred in such action or proceeding. 
  
 IN WITNESS
WHEREOF, the parties hereto have executed this Agreement as of the date first above written. 
  

	ADVANCED	DRILLING SERVICES, LLC 

  

			
	 /s/ Eric McAfee

	 	  

	Eric McAfee, President & CEO	 	Date
		
	VERDISYS, INC.	 	 
		
	 /s/ John O’Keefe

	 	  

	John O’Keefe, EVP & Co-CEO	 	Date

  
  

 EXHIBIT A 
  

AFJ Rig Design Specifications 
  

	1)	AFJ Rig System Design Drawing #1 as of March 9, 2005: 

  
 

 
  

	2)	Major Components & Base Specifications as of March 3, 2005: 

  

			
	Trailer	  	Single Drop, Steel Frame, Two Axles, 48 foot length with access steps and leveling outriggers
		
	Power	  	560 HP Cummins Turbo Diesel Engine complete with all accessories to operate on a continuous basis
		
	Hydraulic Pumps	  	Three Dennison mounted on engine
		
	Hydraulic Tank	  	100 Gallon capacity with hydraulic cooling fan
		
	Diesel Fuel Tank	  	50 Gallon capacity
		
	Muffler	  	Super quiet
		
	Electric Generator	  	10 KW 120/240 60 Hertz, clean power
		
	Water Pump	  	Model 4200 Jetstream, 15,000 psi, minimum 20 GPM, hydraulic driven
		
	Abrasive System	  	15,000 psi, minimum 15 gallon capacity, pneumatic filling system

 Major Components & Base Specifications as of March 3, 2005 (continued)

  

			
	Coil Reel	  	Capacity for 8,500 feet 1.25 inch diameter tube with level wind
		
	Injector	  	Minimum of 22,000 Lbs. push/pull rating, rated speed in low 60 meters per minute, rated speed in high 90 meters per minute, injector weight 3000 Lbs., hydraulic chain tension, hydraulic skate
pressure, load cell only weight indicator, electric depth counter, with chains for 1.0 to 1.25 inch diameter coil tube
		
	BOP System	  	3,000 psi in all areas, Texas Oil Tools or Similar manufacturer
		
	Operator Cabin	  	Harden room for three (3) personnel with AC and Heat with adjustable chair
		
	Computer Display	  	All functions in control cabin
		
	PLC	  	Program Logic Controls, where required
		
	Over Ride Controls	  	Manual
		
	Lighting	  	Normal and Emergency lighting in all critical areas
		
	Crane	  	Knuckle Joint type with a minimum of 10,000 Lbs. capacity
		
	Pump	  	Acid injection with metering system
		
	Jet Hose Reel	  	Capacity for 0.05 to 1.25 inch diameter and 500 feet length
		
	Well Work Platform	  	Adjustable with access steps
		
	Storage	  	Lockable with itemized storage
		
	FAT	  	Formation Access Tool (FAT) with 25 Ton capacity
		
	Computer, Servos	  	Fanuc or similar
		
	Jack System	  	Ball screw, Joy or similar
		
	Rotary Axis	  	R and M, 123,000 Lb. capacity
		
	Tubing Spider	  	Weatherford
		
	Manuals	  	Complete Operating manuals onboard
		
	Training	  	On location for three (3) personnel

  
  

 EXHIBIT B 
  

Consent to Sub-License 
  
 The undersigned, Alberta Energy Holdings, Inc. (“AEH”), is a party to that certain License Agreement entered into by and between AEH and Verdisys, Inc.
(“VDYS”) for Abrasive Fluid Jet Technology dated as of October 27, 2004 (“Licensing Agreement”). The Licensing Agreement which is in full force and effect, including approval by the Verdisys board, has not been amended to date
and is hereby incorporated by reference. 
  
 VDYS agrees to sub-license the AEH
abrasive fluid jet drill technology and AEH hereby consents and agrees to the sub-license of its technology to Advanced Drilling Services, LLC (“ADS”) pursuant to Section 1.3 of the Drill Rig Development and Management Agreement by and
between VDYS and ADS (the “Agreement”). In the event that VDYS is removed as operator of the AFJ Rig (as defined in the Agreement) pursuant to the terms of the Agreement, ADS hereby agrees to assume the royalty obligations under the
Licensing Agreement, specifically payment of two percent (2%) of gross revenue generated, subject to a minimum of $1,000 per well serviced in the manner specified therein. Should the royalty payments not be timely paid in the manner proscribed in
the Licensing Agreement, this Consent to Sub-License the technology will become null and void for non-performance. 
  

			
	VERDISYS, INC.
		
	By:	 	 /s/ J O’Keefe

	Name:	 	J. O’Keefe
	Title:	 	CFO
		
	Date:	 	4-13-05
	
	ALBERTA ENERGY HOLDINGS, INC.
		
	By:	 	 /s/ Mark McAfee

	Name:	 	Mark McAfee
	Title:	 	President
		
	Date:	 	4-13-05
	
	ADVANCED DRILLING SERVICES, LLC.
		
	By:	 	 Eric A. McAfee

	Name:	 	Eric A. McAfee
	Title:	 	President
		
	Date:	 	4-13-052000 Stock Incentive Plan

 Exhibit 10.1 
  
 Lifeline Systems, Inc. 
  
 2000 STOCK INCENTIVE PLAN 
  
 1. Purpose 
  
 The purpose of this 2000 Stock Incentive Plan (the “Plan”) of Lifeline Systems, Inc., a Massachusetts corporation (the “Company”), is
to advance the interests of the Company’s stockholders by enhancing the Company’s ability to attract, retain and motivate persons who make (or are expected to make) important contributions to the Company by providing such persons with
equity ownership opportunities and performance-based incentives and thereby better aligning the interests of such persons with those of the Company’s stockholders. Except where the context otherwise requires, the term “Company” shall
include any of the Company’s present or future subsidiary corporations as defined in Section 424(f) of the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder (the “Code”) and any other business
venture (including, without limitation, joint venture or limited liability company) in which the Company has a significant interest, as determined by the Board of Directors of the Company (the “Board”). 
  
 2. Eligibility 
  
 (a) All of the Company’s employees, officers, directors, consultants and advisors (and any individuals who have
accepted an offer for employment) are eligible to be granted options, restricted stock awards, or other stock-based awards (each, an “Award”) under the Plan. Each person who has been granted an Award under the Plan shall be deemed a
“Participant”. 
  
 (b) Directors who are not also
employees of the Company shall be granted, on the sixth business day in each calendar year, options to purchase 5,000 shares of Common Stock at a price equal to 100% of the fair market value of a share of Common Stock on the date of grant. Such
options shall become exercisable in three equal installments over a two-year period, with the first installment becoming exercisable on the date of grant and the second and third installments becoming exercisable on the first and second
anniversaries of the date of grant, respectively. 
  
 3. Administration,
Delegation 
  
 (a) Administration by Board of
Directors. The Plan will be administered by the Board of Directors of the Company (the “Board”). The Board shall have authority to grant Awards and to adopt, amend and repeal such administrative rules, guidelines and practices relating
to the Plan as it shall deem advisable. The Board may correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Award in the manner and to the extent it shall deem expedient to carry the Plan into effect and it shall
be the sole and final judge of such expediency. All decisions by the Board shall be made in the Board’s sole discretion and shall be final and binding on all persons having or claiming any interest in the Plan or in any Award. No director or
person acting pursuant to the authority delegated by the Board shall be liable for any action or determination relating to or under the Plan made in good faith. 

 (b) Appointment of Committees. To the extent permitted by applicable law, the Board may delegate
any or all of its powers under the Plan to one or more committees or subcommittees of the Board (a “Committee”). All references in the Plan to the “Board” shall mean the Board or a Committee of the Board or the executive officer
referred to in Section 3(b) to the extent that the Board’s powers or authority under the Plan have been delegated to such Committee or executive officer. 
  

4. Stock Available for Awards 
  
 (a) Number of Shares. Subject to adjustment under Section 8, the maximum aggregate number of shares of common stock, $0.02 par value per share, of
the Company (the “Common Stock”), which may be subject to Awards made under the Plan is 250,000 shares of common stock (plus 45,000 shares which may be issued to non-employee directors pursuant to options granted under the Plan), plus an
annual increase to be added on January 1 of each year, beginning in 2004, equal to the least of (i) 250,000 shares, (ii) 2.5% of the outstanding shares on such date, or (iii) a lesser amount determined by the Board. If any Award under the Plan or
any Award under any terminated employee benefit plan of the Company expires or is terminated, surrendered or canceled without having been fully exercised or is forfeited in whole or in part or results in any Common Stock not being issued, the unused
Common Stock covered by such Award shall again be available for the grant of Awards under the Plan, subject, however, in the case of Incentive Stock Options (as hereinafter defined), to any limitation required under the Code. Shares issued under the
Plan may consist in whole or in part of authorized but unissued shares or treasury shares. As of January 1 of each year, commencing with the year 2004, the aggregate number of shares of Common Stock available for the grant of options under the Plan
to non-employee directors shall automatically be increased by the number to cause the total number of shares of Common Stock then available for non-employee directors to be restored to 45,000. 
  
 (b) Per-Participant Limit. Subject to adjustment under Section 8, for
Awards granted after the Common Stock is registered under the Securities Exchange Act of 1934 (the “Exchange Act”), the maximum number of shares of Common Stock with respect to which Awards may be granted to any Participant under the Plan
shall be 100,000 per calendar year. The per-Participant limit described in this Section 4(b) shall be construed and applied consistently with Section 162(m) of the Code (“Section 162(m)”). 
  
 5. Stock Options 
  
 (a) General. The Board may grant options to purchase Common Stock (each, an “Option”) and determine the
number of shares of Common Stock to be covered by each Option, the exercise price of each Option and the conditions and limitations applicable to the exercise of each Option, including conditions relating to applicable federal or state securities
laws, as it considers necessary or advisable. An Option which is not intended to be an Incentive Stock Option (as hereinafter defined) shall be designated a “Nonstatutory Stock Option”. 
  
 (b) Incentive Stock Options. An Option that the Board intends to be an
“incentive stock option” as defined in Section 422 of the Code (an “Incentive Stock Option”) shall only be granted to employees of the Company and shall be subject to and shall be construed consistently with the requirements of
Section 422 of the Code. The Company shall have no liability to a Participant, or any other party, if an Option (or any part thereof) which is intended to be an Incentive Stock Option is not an Incentive Stock Option. 

 (c) Exercise Price. The Board shall establish the exercise price at the time each Option is
granted and specify it in the applicable option agreement. 
  
 (d)
Duration of Options. Each Option shall be exercisable at such times and subject to such terms and conditions as the Board may specify in the applicable option agreement. 
  
 (e) Exercise of Option. Options may be exercised by delivery to the Company of a written notice of exercise signed by
the proper person or by any other form of notice (including electronic notice) approved by the Board together with payment in full as specified in Section 5(f) for the number of shares for which the Option is exercised. 
  
 (f) Payment Upon Exercise. Common Stock purchased upon the exercise of
an Option granted under the Plan shall be paid for as follows: 
  
 (1) in cash or by check, payable to the order of the Company; 
  
 (2) except as the Board may, in its sole discretion, otherwise provide in an option agreement, by (i) delivery of an irrevocable and unconditional undertaking by a creditworthy broker to deliver promptly to the Company sufficient funds to
pay the exercise price and any required tax withholding or (ii) delivery by the Participant to the Company of a copy of irrevocable and unconditional instructions to a creditworthy broker to deliver promptly to the Company cash or a check sufficient
to pay the exercise price and any required tax withholding; 
  
 (3) provided that the Common Stock is registered under the Exchange Act, by delivery of shares of Common Stock owned by the Participant valued at their fair market value as determined by (or in a manner approved by) the Board in good faith
(“Fair Market Value”), provided (i) such method of payment is then permitted under applicable law and (ii) such Common Stock was owned by the Participant at least six months prior to such delivery; 
  
 (4) to the extent permitted by the Board, in its sole discretion by (i)
delivery of a promissory note of the Participant to the Company on terms determined by the Board, or (ii) payment of such other lawful consideration as the Board may determine; or 
  
 (5) by any combination of the above permitted forms of payment. 
  
 6. Restricted Stock 
  
 (a) Grants. The Board may grant Awards entitling recipients to acquire shares of Common Stock, subject to the right
of the Company to repurchase all or part of such shares at their issue price or other stated or formula price (or to require forfeiture of such shares if issued at no cost) from the recipient in the event that conditions specified by the Board in
the applicable Award are not satisfied prior to the end of the applicable restriction period or periods established by the Board for such Award (each, a “Restricted Stock Award”). 

 (b) Terms and Conditions. The Board shall determine the terms and conditions of any such
Restricted Stock Award, including the conditions for repurchase (or forfeiture) and the issue price, if any. Any stock certificates issued in respect of a Restricted Stock Award shall be registered in the name of the Participant and, unless
otherwise determined by the Board, deposited by the Participant, together with a stock power endorsed in blank, with the Company (or its designee). At the expiration of the applicable restriction periods, the Company (or such designee) shall deliver
the certificates no longer subject to such restrictions to the Participant or if the Participant has died, to the beneficiary designated, in a manner determined by the Board, by a Participant to receive amounts due or exercise rights of the
Participant in the event of the Participant’s death (the “Designated Beneficiary”). In the absence of an effective designation by a Participant, Designated Beneficiary shall mean the Participant’s estate. 
  
 7. Other Stock-Based Awards 
  
 The Board shall have the right to grant other Awards based upon the Common
Stock having such terms and conditions as the Board may determine, including the grant of shares based upon certain conditions, the grant of securities convertible into Common Stock and the grant of stock appreciation rights. 
  
 8. Adjustments for Changes in Common Stock and Certain Other Events 
  
 (a) Changes in Capitalization. In the event of any stock split,
reverse stock split, stock dividend, recapitalization, combination of shares, reclassification of shares, spin-off or other similar change in capitalization or event, or any distribution to holders of Common Stock other than a normal cash dividend,
(i) the number and class of securities available under this Plan, (ii) the per-Participant limit set forth in Section 4(b), (iii) the number and class of securities and exercise price per share subject to each outstanding Option, (iv) the repurchase
price per share subject to each outstanding Restricted Stock Award, and (v) the terms of each other outstanding Award shall be appropriately adjusted by the Company (or substituted Awards may be made, if applicable) to the extent the Board shall
determine, in good faith, that such an adjustment (or substitution) is necessary and appropriate. If this Section 8(a) applies and Section 8(c) also applies to any event, Section 8(c) shall be applicable to such event, and this Section 8(a) shall
not be applicable. 
  
 (b) Liquidation or Dissolution. In
the event of a proposed liquidation or dissolution of the Company, the Board shall upon written notice to the Participants provide that all then unexercised Options will (i) become exercisable in full as of a specified time at least 10 business days
prior to the effective date of such liquidation or dissolution and (ii) terminate effective upon such liquidation or dissolution, except to the extent exercised before such effective date. The Board may specify the effect of a liquidation or
dissolution on any Restricted Stock Award or other Award granted under the Plan at the time of the grant of such Award. 
  
 (c) Acquisition and Change in Control Events 
  

	 	(1)	Definitions 

  

	 	(a)	An “Acquisition Event” shall mean: 

  

	 	(i)	any merger or consolidation of the Company with or into another entity as a result of which the Common Stock is converted into or exchanged for the right to receive cash, securities
or other property; or 

	 	(ii)	any exchange of shares of the Company for cash, securities or other property pursuant to a statutory share exchange transaction. 

  

	 	(b)	A “Change in Control Event” shall mean: 

  

	 	(i)	the acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) (a “Person”) of beneficial ownership of any capital stock of the Company if, after such acquisition, such Person beneficially owns (within the meaning of Rule 13d-3 promulgated under the Exchange Act) 30% or more of either (x)
the then-outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (y) the combined voting power of the then-outstanding securities of the Company entitled to vote generally in the election of directors
(the “Outstanding Company Voting Securities”); provided, however, that for purposes of this subsection (i), the following acquisitions shall not constitute a Change in Control Event: (A) any acquisition directly from the
Company (excluding an acquisition pursuant to the exercise, conversion or exchange of any security exercisable for, convertible into or exchangeable for common stock or voting securities of the Company, unless the Person exercising, converting or
exchanging such security acquired such security directly from the Company or an underwriter or agent of the Company), (B) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation
controlled by the Company, or (C) any acquisition by any corporation pursuant to a Business Combination (as defined below) which complies with clauses (x) and (y) of subsection (iii) of this definition; or 

  

	 	(ii)	such time as the Continuing Directors (as defined below) do not constitute a majority of the Board (or, if applicable, the Board of Directors of a successor corporation to the
Company), where the term “Continuing Director” means at any date a member of the Board (x) who was a member of the Board on the date of the initial adoption of this Plan by 

	 	    	the Board or (y) who was nominated or elected subsequent to such date by at least a majority of the directors who were Continuing Directors at the time of such nomination or
election or whose election to the Board was recommended or endorsed by at least a majority of the directors who were Continuing Directors at the time of such nomination or election; provided, however, that there shall be excluded from this clause
(y) any individual whose initial assumption of office occurred as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents, by or on
behalf of a person other than the Board; or 

  

	 	(iii)	the consummation of a merger, consolidation, reorganization, recapitalization or statutory share exchange involving the Company or a sale or other disposition of all or
substantially all of the assets of the Company (a “Business Combination”), unless, immediately following such Business Combination, each of the following two conditions is satisfied: (x) all or substantially all of the individuals and
entities who were the beneficial owners of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding
shares of common stock and the combined voting power of the then- outstanding securities entitled to vote generally in the election of directors, respectively, of the resulting or acquiring corporation in such Business Combination (which shall
include, without limitation, a corporation which as a result of such transaction owns the Company or substantially all of the Company’s assets either directly or through one or more subsidiaries) (such resulting or acquiring corporation is
referred to herein as the “Acquiring Corporation”) in substantially the same proportions as their ownership of the Outstanding Company Common Stock and Outstanding Company Voting Securities, respectively, immediately prior to such Business
Combination and (y) no Person (excluding the Acquiring Corporation or any employee benefit plan (or related trust) maintained or sponsored by the Company or by the Acquiring Corporation) beneficially owns, directly or indirectly, 30% or more of the
then- outstanding shares of common stock of the Acquiring Corporation, or of the combined voting power of the then-outstanding securities of such corporation entitled to vote generally in the election of directors (except to the extent that such
ownership existed prior to the Business Combination). 

	 	(2)	Effect on Options 

  

	 	(a)	Acquisition Event. Upon the occurrence of an Acquisition Event (regardless of whether such event also constitutes a Change in Control Event), or the execution by the Company
of any agreement with respect to an Acquisition Event (regardless of whether such event will result in a Change in Control Event), the Board shall provide that all outstanding Options shall be assumed, or equivalent options shall be substituted, by
the acquiring or succeeding corporation (or an affiliate thereof); provided that if such Acquisition Event also constitutes a Change in Control Event, except to the extent specifically provided to the contrary in the instrument evidencing any Option
or any other agreement between a Participant and the Company, such assumed or substituted options shall be immediately exercisable in full upon the occurrence of such Acquisition Event. For purposes hereof, an Option shall be considered to be
assumed if, following consummation of the Acquisition Event, the Option confers the right to purchase, for each share of Common Stock subject to the Option immediately prior to the consummation of the Acquisition Event, the consideration (whether
cash, securities or other property) received as a result of the Acquisition Event by holders of Common Stock for each share of Common Stock held immediately prior to the consummation of the Acquisition Event (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of the outstanding shares of Common Stock); provided, however, that if the consideration received as a result of the Acquisition Event is not solely common stock of the
acquiring or succeeding corporation (or an affiliate thereof), the Company may, with the consent of the acquiring or succeeding corporation, provide for the consideration to be received upon the exercise of Options to consist solely of common stock
of the acquiring or succeeding corporation (or an affiliate thereof) equivalent in fair market value to the per share consideration received by holders of outstanding shares of Common Stock as a result of the Acquisition Event.

  
 Notwithstanding the foregoing,
if the acquiring or succeeding corporation (or an affiliate thereof) does not agree to assume, or substitute for, such Options, then the Board shall, upon written notice to the Participants, provide that all then unexercised Options will become
exercisable in full as of a specified time prior to the Acquisition Event and will terminate immediately prior to the consummation of such Acquisition Event, except to the extent 

 exercised by the Participants before the consummation of such Acquisition Event; provided, however, in
the event of an Acquisition Event under the terms of which holders of Common Stock will receive upon consummation thereof a cash payment for each share of Common Stock surrendered pursuant to such Acquisition Event (the “Acquisition
Price”), then the Board may instead provide that all outstanding Options shall terminate upon consummation of such Acquisition Event and that each Participant shall receive, in exchange therefor, a cash payment equal to the amount (if any) by
which (A) the Acquisition Price multiplied by the number of shares of Common Stock subject to such outstanding Options (whether or not then exercisable), exceeds (B) the aggregate exercise price of such Options. 
  

	 	(b)	Change in Control Event that is not an Acquisition Event. Upon the occurrence of a Change in Control Event that does not also constitute an Acquisition Event, except to the
extent specifically provided to the contrary in the instrument evidencing any Option or any other agreement between a Participant and the Company, all Options then-outstanding shall automatically become immediately exercisable in full.

  

	 	(3)	Effect on Restricted Stock Awards 

  

	 	(a)	Acquisition Event that is not a Change in Control Event. Upon the occurrence of an Acquisition Event that is not a Change in Control Event, the repurchase and other rights of
the Company under each outstanding Restricted Stock Award shall inure to the benefit of the Company’s successor and shall apply to the cash, securities or other property which the Common Stock was converted into or exchanged for pursuant to
such Acquisition Event in the same manner and to the same extent as they applied to the Common Stock subject to such Restricted Stock Award. 

  

	 	(b)	Change in Control Event. Upon the occurrence of a Change in Control Event (regardless of whether such event also constitutes an Acquisition Event), except to the extent
specifically provided to the contrary in the instrument evidencing any Restricted Stock Award or any other agreement between a Participant and the Company, all restrictions and conditions on all Restricted Stock Awards then-outstanding shall
automatically be deemed terminated or satisfied. 

  

	 	(4)	Effect on Other Awards 

  

	 	(a)	Acquisition Event that is not a Change in Control Event. The Board shall specify the effect of an Acquisition Event that is not a Change in Control Event on any other Award
granted under the Plan at the time of the grant of such Award. 

	 	(b)	Change in Control Event. Upon the occurrence of a Change in Control Event (regardless of whether such event also constitutes an Acquisition Event), except to the extent
specifically provided to the contrary in the instrument evidencing any other Award or any other agreement between a Participant and the Company, all other Awards shall become exercisable, realizable or vested in full, or shall be free of all
conditions or restrictions, as applicable to each such Award. 

  

	 	(5)	Limitations. Notwithstanding the foregoing provisions of this Section 8(c), if the Change in Control Event is intended to be accounted for as a “pooling of
interests” for financial accounting purposes, and if the acceleration to be effected by the foregoing provisions of this Section 8(c) would preclude accounting for the Change in Control Event as a “pooling of interests” for financial
accounting purposes, then no such acceleration shall occur upon the Change in Control Event. 

  
 9. General Provisions Applicable to Awards 
  
 (a) Transferability of Awards. Except as the Board may otherwise determine or provide in an Award, Awards shall not be sold, assigned, transferred, pledged or otherwise encumbered by the person to whom they are
granted, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the life of the Participant, shall be exercisable only by the Participant. References to a Participant, to the extent relevant in
the context, shall include references to authorized transferees. 
  
 (b) Documentation. Each Award shall be evidenced by a written instrument in such form as the Board shall determine. Each Award may contain terms and conditions in addition to those set forth in the Plan. 
  
 (c) Board Discretion. Except as otherwise provided by the Plan, each
Award may be made alone or in addition or in relation to any other Award. The terms of each Award need not be identical, and the Board need not treat Participants uniformly. 
  
 (d) Termination of Status. The Board shall determine the effect on an Award of the disability, death, retirement,
authorized leave of absence or other change in the employment or other status of a Participant and the extent to which, and the period during which, the Participant, the Participant’s legal representative, conservator, guardian or Designated
Beneficiary may exercise rights under the Award. 
  
 (e)
Withholding. Each Participant shall pay to the Company, or make provision satisfactory to the Board for payment of, any taxes required by law to be withheld in connection with Awards to such Participant no later than the date of the event
creating the tax liability. Except as the Board may otherwise provide in an Award, when the Common Stock is registered under the Exchange Act, Participants may, to the extent then permitted under applicable law, 

 satisfy such tax obligations in whole or in part by delivery of shares of Common Stock, including shares retained from
the Award creating the tax obligation, valued at their Fair Market Value. The Company may, to the extent permitted by law, deduct any such tax obligations from any payment of any kind otherwise due to a Participant. 
  
 (f) Amendment of Award. The Board may amend, modify or terminate any
outstanding Award, including but not limited to, substituting therefor another Award of the same or a different type, changing the date of exercise or realization, and converting an Incentive Stock Option to a Nonstatutory Stock Option, provided
that the Participant’s consent to such action shall be required unless the Board determines that the action, taking into account any related action, would not materially and adversely affect the Participant. 
  
 (g) Conditions on Delivery of Stock. The Company will not be obligated
to deliver any shares of Common Stock pursuant to the Plan or to remove restrictions from shares previously delivered under the Plan until (i) all conditions of the Award have been met or removed to the satisfaction of the Company, (ii) in the
opinion of the Company’s counsel, all other legal matters in connection with the issuance and delivery of such shares have been satisfied, including any applicable securities laws and any applicable stock exchange or stock market rules and
regulations, and (iii) the Participant has executed and delivered to the Company such representations or agreements as the Company may consider appropriate to satisfy the requirements of any applicable laws, rules or regulations. 
  
 (h) Acceleration. The Board may at any time provide that any Options
shall become immediately exercisable in full or in part, that any Restricted Stock Awards shall be free of restrictions in full or in part or that any other Awards may become exercisable in full or in part or free of some or all restrictions or
conditions, or otherwise realizable in full or in part, as the case may be. 
  
 10. Miscellaneous 
  
 (a) No Right To
Employment or Other Status. No person shall have any claim or right to be granted an Award, and the grant of an Award shall not be construed as giving a Participant the right to continued employment or any other relationship with the Company.
The Company expressly reserves the right at any time to dismiss or otherwise terminate its relationship with a Participant free from any liability or claim under the Plan, except as expressly provided in the applicable Award. 
  
 (b) No Rights As Stockholder. Subject to the provisions of the
applicable Award, no Participant or Designated Beneficiary shall have any rights as a stockholder with respect to any shares of Common Stock to be distributed with respect to an Award until becoming the record holder of such shares. Notwithstanding
the foregoing, in the event the Company effects a split of the Common Stock by means of a stock dividend and the exercise price of and the number of shares subject to such Option are adjusted as of the date of the distribution of the dividend
(rather than as of the record date for such dividend), then an optionee who exercises an Option between the record date and the distribution date for such stock dividend shall be entitled to receive, on the distribution date, the stock dividend with
respect to the shares of Common Stock acquired upon such Option exercise, notwithstanding the fact that such shares were not outstanding as of the close of business on the record date for such stock dividend. 

 (c) Effective Date and Term of Plan. The Plan shall become effective on the date on which it is
adopted by the Board, but no Award granted to a Participant that is intended to comply with Section 162(m) shall become exercisable, vested or realizable, as applicable to such Award, unless and until the Plan has been approved by the Company’s
stockholders to the extent stockholder approval is required by Section 162(m) in the manner required under Section 162(m) (including the vote required under Section 162(m)). No Awards shall be granted under the Plan after the completion of ten years
from the earlier of (i) the date on which the Plan was adopted by the Board or (ii) the date the Plan was approved by the Company’s stockholders, but Awards previously granted may extend beyond that date. 
  
 (d) Amendment of Plan. The Board may amend, suspend or terminate the
Plan or any portion thereof at any time, provided that to the extent required by Section 162(m), no Award granted to a Participant that is intended to comply with Section 162(m) after the date of such amendment shall become exercisable, realizable
or vested, as applicable to such Award, unless and until such amendment shall have been approved by the Company’s stockholders as required by Section 162(m) (including the vote required under Section 162(m)). 
  
 (e) Governing Law. The provisions of the Plan and all Awards made
hereunder shall be governed by and interpreted in accordance with the laws of the Commonwealth of Massachusetts without regard to any applicable conflicts of law. 
  
 (f) Provision for Foreign Participants. The Board of Directors may, without amending the Plan, modify awards or
options granted to participants who are foreign nationals or employed outside the United States to recognize differences in laws, rules, regulations or customs of such foreign jurisdictions with respect to tax, securities, currency, employee benefit
or other matters.

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