Document:

EX-10.3

 Exhibit 10.3 

NOVAN, INC. 
 2016
INCENTIVE AWARD PLAN 
 ARTICLE 1. 

PURPOSE 
 The purpose of
the Novan, Inc. 2016 Incentive Award Plan (as it may be amended or restated from time to time, the “Plan”) is to promote the success and enhance the value of Novan, Inc. the (“Company”) by linking the individual
interests of the members of the Board, Employees, and Consultants to those of Company stockholders and by providing such individuals with an incentive for outstanding performance to generate superior returns to Company stockholders. The Plan is
further intended to provide flexibility to the Company in its ability to motivate, attract, and retain the services of members of the Board, Employees, and Consultants upon whose judgment, interest, and special effort the successful conduct of the
Company’s operation is largely dependent. 
 ARTICLE 2. 

DEFINITIONS AND CONSTRUCTION 

Wherever the following terms are used in the Plan they shall have the meanings specified below, unless the context clearly indicates
otherwise. The singular pronoun shall include the plural where the context so indicates. 
 2.1 “Administrator” shall mean
the entity that conducts the general administration of the Plan as provided in Article 12. With reference to the duties of the Committee under the Plan which have been delegated to one or more persons pursuant to Section 12.6, or as to which
the Board has assumed, the term “Administrator” shall refer to such person(s) unless the Committee or the Board has revoked such delegation or the Board has terminated the assumption of such duties. 

2.2 “Applicable Accounting Standards” shall mean Generally Accepted Accounting Principles in the United States, International
Financial Reporting Standards or such other accounting principles or standards as may apply to the Company’s financial statements under United States federal securities laws from time to time. 

2.3 “Applicable Law” shall mean any applicable law, including without limitation: (a) provisions of the Code, the
Securities Act, the Exchange Act and any rules or regulations thereunder; (b) corporate, securities, tax or other laws, statutes, rules, requirements or regulations, whether federal, state, local or foreign; and (c) rules of any securities
exchange or automated quotation system on which the Shares are listed, quoted or traded. 
 2.4 “Automatic Exercise Date”
shall mean, with respect to an Option or a Stock Appreciation Right, the last business day of the applicable Option Term or Stock Appreciation Right Term that was initially established by the Administrator for such Option or Stock Appreciation Right
(e.g., the last business day prior to the tenth anniversary of the date of grant of such Option or Stock Appreciation Right if the Option or Stock Appreciation Right initially had a ten-year Option Term or Stock Appreciation Right Term, as
applicable). 

 2.5 “Award” shall mean an Option, a Stock Appreciation Right, a Restricted Stock
award, a Restricted Stock Unit award, an Other Stock or Cash Based Award or a Dividend Equivalent award, which may be awarded or granted under the Plan. 

2.6 “Award Agreement” shall mean any written notice, agreement, terms and conditions, contract or other instrument or document
evidencing an Award, including through electronic medium, which shall contain such terms and conditions with respect to an Award as the Administrator shall determine consistent with the Plan. 

2.7 “Award Limit” shall mean with respect to Awards that shall be payable in Shares or in cash, as the case may be, the
respective limit set forth in Section 3.2. 
 2.8 “Board” shall mean the Board of Directors of the Company. 

2.9 “Change in Control” shall mean and includes each of the following: 

(a) A transaction or series of transactions (other than an offering of Common Stock to the general public through a registration statement
filed with the Securities and Exchange Commission) whereby any “person” or related “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) directly or indirectly acquires
beneficial ownership (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act) of securities of the Company possessing more than 50% of the total combined voting power of the Company’s securities outstanding immediately after such
acquisition; provided, however, that the following acquisitions shall not constitute a Change in Control: (i) any acquisition by the Company or any of its Subsidiaries; (ii) any acquisition by an employee benefit plan
maintained by the Company or any of its Subsidiaries, (iii) any acquisition which complies with Sections 2.9(c)(i), 2.9(c)(ii) and 2.9(c)(iii); or (iv) in respect of an Award held by a particular Holder, any acquisition by the Holder or
any group of persons including the Holder (or any entity controlled by the Holder or any group of persons including the Holder); or 
 (b)
The Incumbent Directors cease for any reason to constitute a majority of the Board; 
 (c) The consummation by the Company (whether directly
involving the Company or indirectly involving the Company through one or more intermediaries) of (x) a merger, consolidation, reorganization, or business combination, (y) a sale or other disposition of all or substantially all of the
Company’s assets in any single transaction or series of related transactions or (z) the acquisition of assets or stock of another entity, in each case other than a transaction: 

(i) which results in the Company’s voting securities outstanding immediately before the transaction continuing to represent (either
by remaining outstanding or by being converted into voting securities of the Company or the person that, as a result of the transaction, controls, directly or indirectly, the Company or owns, directly or indirectly, all or substantially all of the
Company’s assets or otherwise succeeds to the business of the Company (the Company or such person, the “Successor Entity”)) directly or indirectly, at least a majority of the combined voting power of the Successor Entity’s
outstanding voting securities immediately after the transaction, and 

  
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 (ii) after which no person or group beneficially owns voting securities representing 50% or
more of the combined voting power of the Successor Entity; provided, however, that no person or group shall be treated for purposes of this Section 2.9(c)(ii) as beneficially owning 50% or more of the combined voting power of the
Successor Entity solely as a result of the voting power held in the Company prior to the consummation of the transaction; and 

(iii) after which at least a majority of the members of the board of directors (or the analogous governing body) of the Successor Entity
were Board members at the time of the Board’s approval of the execution of the initial agreement providing for such transaction; or 

(d) The date of the completion of a liquidation or dissolution of the Company. 

Notwithstanding the foregoing, if a Change in Control constitutes a payment event with respect to any Award (or any portion of an Award) that provides for the
deferral of compensation that is subject to Section 409A, to the extent required to avoid the imposition of additional taxes under Section 409A, the transaction or event described in subsection (a), (b), (c) or (d) with respect
to such Award (or portion thereof) shall only constitute a Change in Control for purposes of the payment timing of such Award if such transaction also constitutes a “change in control event,” as defined in Treasury Regulation
Section 1.409A-3(i)(5). 
 The Administrator shall have full and final authority, which shall be exercised in its sole discretion, to determine
conclusively whether a Change in Control has occurred pursuant to the above definition, the date of the occurrence of such Change in Control and any incidental matters relating thereto; provided that any exercise of authority in conjunction with a
determination of whether a Change in Control is a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5) shall be consistent with such regulation. 

2.10 “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, together with the regulations and
official guidance promulgated thereunder, whether issued prior or subsequent to the grant of any Award. 
 2.11 “Committee”
shall mean the Compensation Committee of the Board, or another committee or subcommittee of the Board or the Compensation Committee of the Board described in Article 12 hereof. 

2.12 “Common Stock” shall mean the common stock of the Company, par value
$            per share. 
 2.13 “Company” shall have the meaning
set forth in Article 1. 
 2.14 “Consultant” shall mean any consultant or adviser engaged to provide services to the Company
or any Subsidiary who qualifies as a consultant or advisor under the applicable rules of the Securities and Exchange Commission for registration of shares on a Form S-8 Registration Statement. 

  
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 2.15 “Covered Employee” shall mean any Employee who is, or could become, a
“covered employee” within the meaning of Section 162(m) of the Code. 
 2.16 “Director” shall mean a member
of the Board, as constituted from time to time. 2.17 “Director Limit” shall have the meaning set forth in Section 4.6. 
 2.18
“Dividend Equivalent” shall mean a right to receive the equivalent value (in cash or Shares) of dividends paid on Shares, awarded under Section 10.2. 

2.19 “DRO” shall mean a “domestic relations order” as defined by the Code or Title I of the Employee Retirement
Income Security Act of 1974, as amended from time to time, or the rules thereunder. 
 2.20 “Effective Date” shall mean the
day prior to the Public Trading Date. 
 2.21 “Eligible Individual” shall mean any person who is an Employee, a Consultant
or a Non-Employee Director, as determined by the Administrator. 
 2.22 “Employee” shall mean any officer or other employee
(as determined in accordance with Section 3401(c) of the Code and the Treasury Regulations thereunder) of the Company or of any Subsidiary. 

2.23 “Equity Restructuring” shall mean a nonreciprocal transaction between the Company and its stockholders, such as a stock
dividend, stock split, spin-off, rights offering or recapitalization through a large, nonrecurring cash dividend, that affects the number or kind of Shares (or other securities of the Company) or the share price of Common Stock (or other securities)
and causes a change in the per-share value of the Common Stock underlying outstanding Awards. 
 2.24 “Exchange Act” shall
mean the Securities Exchange Act of 1934, as amended from time to time. 
 2.25 “Expiration Date” shall have the meaning
given to such term in Section 13.1(c). 
 2.26 “Fair Market Value” shall mean, as of any given date, the value of a
Share determined as follows: 
 (a) If the Common Stock is (i) listed on any established securities exchange (such as the New York
Stock Exchange, the NASDAQ Capital Market, the NASDAQ Global Market and the NASDAQ Global Select Market), (ii) listed on any national market system or (iii) quoted or traded on any automated quotation system, its Fair Market Value shall be
the closing sales price for a Share as quoted on such exchange or system for such date or, if there is no closing sales price for a Share on the date in question, the closing sales price for a Share on the last preceding date for which such
quotation exists, as reported in The Wall Street Journal or such other source as the Administrator deems reliable; 

  
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 (b) If the Common Stock is not listed on an established securities exchange, national market
system or automated quotation system, but the Common Stock is regularly quoted by a recognized securities dealer, its Fair Market Value shall be the mean of the high bid and low asked prices for such date or, if there are no high bid and low asked
prices for a Share on such date, the high bid and low asked prices for a Share on the last preceding date for which such information exists, as reported in The Wall Street Journal or such other source as the Administrator deems reliable; or

 (c) If the Common Stock is neither listed on an established securities exchange, national market system or automated quotation system
nor regularly quoted by a recognized securities dealer, its Fair Market Value shall be established by the Administrator in good faith. 

Notwithstanding the foregoing, with respect to any Award granted after the effectiveness of the Company’s registration statement relating
to its initial public offering and prior to the Public Trading Date, the Fair Market Value shall mean the initial public offering price of a Share as set forth in the Company’s final prospectus relating to its initial public offering filed with
the Securities and Exchange Commission. 
 2.27 “Greater Than 10% Stockholder” shall mean an individual then owning (within
the meaning of Section 424(d) of the Code) more than 10% of the total combined voting power of all classes of stock of the Company or any subsidiary corporation (as defined in Section 424(f) of the Code) or parent corporation thereof (as
defined in Section 424(e) of the Code). 
 2.28 “Holder” shall mean a person who has been granted an Award. 

2.29 “Incentive Stock Option” shall mean an Option that is intended to qualify as an incentive stock option and conforms to
the applicable provisions of Section 422 of the Code. 
 2.30 “Incumbent Directors’ shall mean for any period of 12
consecutive months, individuals who, at the beginning of such period, constitute the Board together with any new Director(s) (other than a Director designated by a person who shall have entered into an agreement with the Company to effect a
transaction described in Section 2.9(a) or 2.9(c)) whose election or nomination for election to the Board was approved by a vote of at least a majority (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 objection to such nomination) of the Directors then still in office who either were Directors at the beginning of the 12-month period or whose election or nomination for election was previously
so approved. 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 an Incumbent Director. 
 2.31 “Non-Employee Director” shall mean a
Director of the Company who is not an Employee. 

  
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 2.32 “Non-Employee Director Equity Compensation Policy” shall have the meaning
set forth in Section 4.6. 
 2.33 “Non-Qualified Stock Option” shall mean an Option that is not an Incentive Stock
Option or which is designated as an Incentive Stock Option but does not meet the applicable requirements of Section 422 of the Code. 

2.34 “Option” shall mean a right to purchase Shares at a specified exercise price, granted under Article 6. An Option shall be
either a Non-Qualified Stock Option or an Incentive Stock Option; provided, however, that Options granted to Non-Employee Directors and Consultants shall only be Non-Qualified Stock Options. 

2.35 “Option Term” shall have the meaning set forth in Section 6.4. 

2.36 “Organizational Documents” shall mean, collectively, (a) the Company’s articles of incorporation, certificate
of incorporation, bylaws or other similar organizational documents relating to the creation and governance of the Company, and (b) the Committee’s charter or other similar organizational documentation relating to the creation and
governance of the Committee. 
 2.37 “Other Stock or Cash Based Award” shall mean a cash payment, cash bonus award, stock
payment, stock bonus award, performance award or incentive award that is paid in cash, Shares or a combination of both, awarded under Section 10.1, which may include, without limitation, deferred stock, deferred stock units, retainers,
committee fees, and meeting-based fees. 
 2.38 Performance-Based Compensation” shall mean any compensation that is intended to
qualify as “performance-based compensation” as described in Section 162(m)(4)(C) of the Code. 
 2.39 “Performance
Criteria” shall mean the criteria (and adjustments) that the Administrator selects for an Award for purposes of establishing the Performance Goal or Performance Goals for a Performance Period, determined as follows: 

(a) The Performance Criteria that shall be used to establish Performance Goals are limited to the following: (i) net earnings or
losses (either before or after one or more of the following: (A) interest, (B) taxes, (C) depreciation, (D) amortization and (E) non-cash equity-based compensation expense); (ii) gross or net sales or revenue or sales
or revenue growth; (iii) net income (either before or after taxes); (iv) adjusted net income; (v) operating earnings or profit (either before or after taxes); (vi) cash flow (including, but not limited to, operating cash flow and
free cash flow); (vii) return on assets or net assets; (viii) return on capital (or invested capital) and cost of capital; (ix) return on stockholders’ equity; (x) total stockholder return; (xi) return on sales;
(xii) gross or net profit or operating margin; (xiii) costs, reductions in costs and cost control measures; (xiv) funds from operations or funds available for distributions; (xv) expenses; (xvi) working capital;
(xvii) earnings or loss per share; (xviii) adjusted earnings or loss per share; (xix) price per share or dividends per share (or appreciation in and/or maintenance of such price or dividends); (xx) economic value added models or
similar metrics; (xxi) regulatory achievements or compliance (including, without limitation, regulatory body approval for commercialization of a product); (xxii) implementation, completion or attainment of critical projects, processes or
objectives relating to research, development, regulatory, commercial, or strategic milestones or 

  
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developments; (xxiii) sales, unit volume or market share; (xxiv) licensing revenue; (xxv) brand recognition/acceptance, (xxvi) inventory turns or cycle time,
(xxvii) strategic initiatives (including, without limitation, with respect to market penetration and spending efficiency, geographic business expansion, manufacturing, commercialization, production and productivity, customer satisfaction and
growth, employee satisfaction, recruitment and maintenance of personnel, human resources management, supervision of litigation and other legal matters, information technology, strategic partnerships and transactions (including acquisitions,
dispositions, joint ventures, in-licensing and out-licensing of intellectual property, and establishment of relationships with commercial entities with respect to the marketing, distribution and sale of Company products, and factoring transactions,
research and development and related activity, financial or other capital raising transactions, operating efficiency, and asset quality); (xxiii) financial ratios (including, without limitation, those measuring liquidity, activity,
profitability or leverage); and (xxix) compound annual growth rate, any of which may be measured either in absolute terms or as compared to any incremental increase or decrease or as compared to results of a peer group or to market performance
indicators or indices. 
 (b) The Administrator, in its sole discretion, may provide that one or more objectively determinable adjustments
shall be made to one or more of the Performance Goals. Such adjustments may include, but are not limited to, one or more of the following: (i) items related to a change in Applicable Accounting Standards; (ii) items relating to financing
activities; (iii) expenses for restructuring or productivity initiatives; (iv) other non-operating items; (v) items related to acquisitions; (vi) items attributable to the business operations of any entity acquired by the Company
during the Performance Period; (vii) items related to the sale or disposition of a business or segment of a business; (viii) items related to discontinued operations that do not qualify as a segment of a business under Applicable
Accounting Standards; (ix) items attributable to any stock dividend, stock split, combination or exchange of stock occurring during the Performance Period; (x) any other items of significant income or expense which are determined to be
appropriate adjustments; (xi) items relating to unusual or nonrecurring corporate transactions, events or developments, (xii) items related to amortization of acquired intangible assets; (xiii) items that are outside the scope of the
Company’s core, on-going business activities; (xiv) items related to acquired in-process research and development; (xv) items relating to changes in tax laws; (xvi) items relating to major licensing or partnership arrangements;
(xvii) items relating to asset impairment charges; (xviii) items relating to gains or losses for litigation, arbitration and contractual settlements; (xix) items attributable to expenses incurred in connection with a reduction in
force or early retirement initiative; (xx) items relating to foreign exchange or currency transactions and/or fluctuations; or (xxi) items relating to any other unusual or nonrecurring events or changes in Applicable Law, Applicable
Accounting Standards or business conditions. For all Awards intended to qualify as Performance-Based Compensation, such determinations shall be made within the time prescribed by, and otherwise in compliance with, Section 162(m) of the Code.

 2.40 “Performance Goals” shall mean, for a Performance Period, one or more goals established in writing by the
Administrator for the Performance Period based upon one or more Performance Criteria. Depending on the Performance Criteria used to establish such Performance Goals, the Performance Goals may be expressed in terms of overall Company performance or
the performance of a Subsidiary, division, business unit, or an individual. The achievement of each Performance Goal shall be determined, to the extent applicable, with reference to Applicable Accounting Standards. 

  
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 2.41 “Performance Period” shall mean one or more periods of time, which may be
of varying and overlapping durations, as the Administrator may select, over which the attainment of one or more Performance Goals will be measured for the purpose of determining a Holder’s right to, vesting of, and/or the payment in respect of,
an Award. 
 2.42 “Permitted Transferee” shall mean, with respect to a Holder, any “family member” of the Holder,
as defined in the General Instructions to Form S-8 Registration Statement under the Securities Act (or any successor form thereto), after taking into account Applicable Law. 

2.43 “Plan” shall have the meaning set forth in Article 1. 

2.44 “Program” shall mean any program adopted by the Administrator pursuant to the Plan containing the terms and conditions
intended to govern a specified type of Award granted under the Plan and pursuant to which such type of Award may be granted under the Plan. 

2.45 “Public Trading Date” shall mean the first date upon which Common Stock is listed (or approved for listing) upon notice
of issuance on any securities exchange or designated (or approved for designation) upon notice of issuance as a national market security on an interdealer quotation system. 

2.46 “Restricted Stock” shall mean Common Stock awarded under Article 8 that is subject to certain restrictions and may be
subject to risk of forfeiture or repurchase. 
 2.47 “Restricted Stock Units” shall mean the right to receive Shares awarded
under Article 9. 
 2.48 “Section 409A” shall mean Section 409A of the Code and the Department of Treasury regulations
and other interpretive guidance issued thereunder, including, without limitation, any such regulations or other guidance that may be issued after the Effective Date. 

2.49 “Securities Act” shall mean the Securities Act of 1933, as amended. 2.50 “Shares” shall mean shares of Common
Stock. 
 2.51 “Stock Appreciation Right” shall mean an Award entitling the Holder (or other person entitled to exercise
pursuant to the Plan) to exercise all or a specified portion thereof (to the extent then exercisable pursuant to its terms) and to receive from the Company an amount determined by multiplying the difference obtained by subtracting the exercise price
per share of such Award from the Fair Market Value on the date of exercise of such Award by the number of Shares with respect to which such Award shall have been exercised, subject to any limitations the Administrator may impose. 

2.52 “SAR Term” shall have the meaning set forth in Section 6.4. 

  
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 2.53 “Subsidiary” shall mean any entity (other than the Company), whether
domestic or foreign, in an unbroken chain of entities beginning with the Company if each of the entities other than the last entity in the unbroken chain beneficially owns, at the time of the determination, securities or interests representing at
least fifty percent (50%) of the total combined voting power of all classes of securities or interests in one of the other entities in such chain. 

2.54 “Substitute Award” shall mean an Award granted under the Plan in connection with a corporate transaction, such as a
merger, combination, consolidation or acquisition of property or stock, in any case, upon the assumption of, or in substitution for, outstanding equity awards previously granted by a company or other entity; provided, however, that in
no event shall the term “Substitute Award” be construed to refer to an award made in connection with the cancellation and repricing of an Option or Stock Appreciation Right. 

2.55 “Termination of Service” shall mean: 

(a) As to a Consultant, the time when the engagement of a Holder as a Consultant to the Company or a Subsidiary is terminated for any reason,
with or without cause, including, without limitation, by resignation, discharge, death or retirement, but excluding terminations where the Consultant simultaneously commences or remains in employment or service with the Company or any Subsidiary.

 (b) As to a Non-Employee Director, the time when a Holder who is a Non-Employee Director ceases to be a Director for any reason,
including, without limitation, a termination by resignation, failure to be elected, death or retirement, but excluding terminations where the Holder simultaneously commences or remains in employment or service with the Company or any Subsidiary.

 (c) As to an Employee, the time when the employee-employer relationship between a Holder and the Company or any Subsidiary is terminated
for any reason, including, without limitation, a termination by resignation, discharge, death, disability or retirement; but excluding terminations where the Holder simultaneously commences or remains in employment or service with the Company or any
Subsidiary. 
 The Administrator, in its sole discretion, shall determine the effect of all matters and questions relating to any
Termination of Service, including, without limitation, whether a Termination of Service has occurred, whether a Termination of Service resulted from a discharge for cause and all questions of whether particular leaves of absence constitute a
Termination of Service; provided, however, that, with respect to Incentive Stock Options, unless the Administrator otherwise provides in the terms of any Program, Award Agreement or otherwise, or as otherwise required by Applicable
Law, a leave of absence, change in status from an employee to an independent contractor or other change in the employee-employer relationship shall constitute a Termination of Service only if, and to the extent that, such leave of absence, change in
status or other change interrupts employment for the purposes of Section 422(a)(2) of the Code and the then-applicable regulations and revenue rulings under said Section. For purposes of the Plan, a Holder’s employee-employer relationship
or consultancy relations shall be deemed to be terminated in the event that the Subsidiary employing or contracting with such Holder ceases to remain an Subsidiary following any merger, sale of stock or other corporate transaction or event
(including, without limitation, a spin-off). 

  
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 ARTICLE 3. 

SHARES SUBJECT TO THE PLAN 

3.1 Number of Shares. 

(a) Subject to Sections 3.1(b) and 13.2, the aggregate number of Shares which may be issued or transferred pursuant to Awards (including,
without limitation, Incentive Stock Options) under the Plan is 1,000,000. Any Shares distributed pursuant to an Award may consist, in whole or in part, of authorized and unissued Common Stock, treasury Common Stock or Common Stock purchased on the
open market. 
 (b) If any Shares subject to an Award are forfeited or expire, or such Award is settled for cash (in whole or in part), the
Shares subject to such Award shall, to the extent of such forfeiture, expiration or cash settlement, again be available for future grants of Awards under the Plan. Notwithstanding anything to the contrary contained herein, the following Shares shall
not be added to the Shares authorized for grant under Section 3.1(a) and shall not be available for future grants of Awards: (i) Shares tendered by a Holder or withheld by the Company in payment of the exercise price of an Option;
(ii) Shares tendered by the Holder or withheld by the Company to satisfy any tax withholding obligation with respect to an Award; (iii) Shares subject to a Stock Appreciation Right that are not issued in connection with the stock
settlement of the Stock Appreciation Right on exercise thereof; and (iv) Shares purchased on the open market with the cash proceeds from the exercise of Options. Any Shares repurchased by the Company under Section 8.4 at the same price
paid by the Holder so that such Shares are returned to the Company shall again be available for Awards. The payment of Dividend Equivalents in cash in conjunction with any outstanding Awards shall not be counted against the Shares available for
issuance under the Plan. Notwithstanding the provisions of this Section 3.1(b), no Shares may again be optioned, granted or awarded if such action would cause an Incentive Stock Option to fail to qualify as an incentive stock option under
Section 422 of the Code. 
 (c) Substitute Awards shall not reduce the Shares authorized for grant under the Plan, except as may be
required by reason of Section 422 of the Code. Additionally, in the event that a company acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines has shares available under a pre-existing plan approved by
its stockholders and not adopted in contemplation of such acquisition or combination, the shares available for grant 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 authorized for grant 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 employed by or providing services to the Company or its Subsidiaries immediately prior to such acquisition or combination. 

  
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 3.2 Limitation on Number of Shares Subject to Awards. Notwithstanding any provision in the
Plan to the contrary, and subject to Section 13.2, the maximum aggregate number of Shares with respect to one or more Awards that may be granted to any one person during any calendar year shall be 300,000 and the maximum aggregate amount of
cash that may be paid in cash to any one person during any calendar year with respect to one or more Awards payable in cash shall be $2,000,000; provided, however, that the foregoing limitations shall not apply prior to the Public
Trading Date and, following the Public Trading Date, the foregoing limitations shall not apply until the earliest of: (a) the first material modification of the Plan (including any increase in the number of Shares reserved for issuance under
the Plan in accordance with Section 3.1); (b) the issuance of all of the Shares reserved for issuance under the Plan; (c) the expiration of the Plan; (d) the first meeting of stockholders at which members of the Board are to be
elected that occurs after the close of the third calendar year following the calendar year in which occurred the first registration of an equity security of the Company under Section 12 of the Exchange Act; or (e) such other date, if any,
on which the “reliance period” described under U.S. Treasury Regulation 1.162-27(f)(2) expires pursuant to Section 162(m) of the Code and the rules and regulations promulgated thereunder. To the extent required by Section 162(m)
of the Code, Shares subject to Awards which are canceled shall continue to be counted against the Award Limit. 
 ARTICLE 4. 

GRANTING OF AWARDS 
 4.1
Participation. The Administrator may, from time to time, select from among all Eligible Individuals, those to whom an Award shall be granted and shall determine the nature and amount of each Award, which shall not be inconsistent with the
requirements of the Plan. Except for any Non-Employee Director’s right to Awards that may be required pursuant to the Non-Employee Director Equity Compensation Policy as described in Section 4.6, no Eligible Individual or other Person
shall have any right to be granted an Award pursuant to the Plan and neither the Company nor the Administrator is obligated to treat Eligible Individuals, Holders or any other persons uniformly. Participation by each Holder in the Plan shall be
voluntary and nothing in the Plan or any Program shall be construed as mandating that any Eligible Individual or other Person shall participate in the Plan. 

4.2 Award Agreement. Each Award shall be evidenced by an Award Agreement that sets forth the terms, conditions and limitations for such
Award as determined by the Administrator in its sole discretion (consistent with the requirements of the Plan and any applicable Program). Award Agreements evidencing Awards intended to qualify as Performance-Based Compensation shall contain such
terms and conditions as may be necessary to meet the applicable provisions of Section 162(m) of the Code. Award Agreements evidencing Incentive Stock Options shall contain such terms and conditions as may be necessary to meet the applicable
provisions of Section 422 of the Code. 
 4.3 Limitations Applicable to Section 16 Persons. Notwithstanding any other
provision of the Plan, the Plan, and any Award granted or awarded to any individual who is then subject to Section 16 of the Exchange Act, shall be subject to any additional limitations set forth in any applicable exemptive rule under
Section 16 of the Exchange Act (including Rule 16b-3 of the Exchange Act and any amendments thereto) that are requirements for the application of such exemptive rule. To the extent permitted by Applicable Law, the Plan and Awards granted or
awarded hereunder shall be deemed amended to the extent necessary to conform to such applicable exemptive rule. 

  
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 4.4 At-Will Service. Nothing in the Plan or in any Program or Award Agreement hereunder
shall confer upon any Holder any right to continue in the employ of, or as a Director or Consultant for, the Company or any Subsidiary, or shall interfere with or restrict in any way the rights of the Company and any Subsidiary, which rights are
hereby expressly reserved, to discharge any Holder at any time for any reason whatsoever, with or without cause, and with or without notice, or to terminate or change all other terms and conditions of employment or engagement, except to the extent
expressly provided otherwise in a written agreement between the Holder and the Company or any Subsidiary. 
 4.5 Foreign Holders.
Notwithstanding any provision of the Plan or applicable Program to the contrary, in order to comply with the laws in countries other than the United States in which the Company and its Subsidiaries operate or have Employees, Non-Employee Directors
or Consultants, or in order to comply with the requirements of any foreign securities exchange or other Applicable Law, the Administrator, in its sole discretion, shall have the power and authority to: (a) determine which Subsidiaries shall be
covered by the Plan; (b) determine which Eligible Individuals outside the United States are eligible to participate in the Plan; (c) modify the terms and conditions of any Award granted to Eligible Individuals outside the United States to
comply with Applicable Law (including, without limitation, applicable foreign laws or listing requirements of any foreign securities exchange); (d) establish subplans and modify exercise procedures and other terms and procedures, to the extent
such actions may be necessary or advisable; provided, however, that no such subplans and/or modifications shall increase the share limitation contained in Section 3.1, the Award Limit or the Director Limit; and (e) take any
action, before or after an Award is made, that it deems advisable to obtain approval or comply with any necessary local governmental regulatory exemptions or approvals or listing requirements of any foreign securities exchange. 

4.6 Non-Employee Director Awards. 

(a) Non-Employee Director Equity Compensation Policy. The Administrator, in its sole discretion, may provide that Awards granted to
Non-Employee Directors shall be granted pursuant to a written nondiscretionary formula established by the Administrator (the “Non-Employee Director Equity Compensation Policy”), subject to the limitations of the Plan. The
Non-Employee Director Equity Compensation Policy shall set forth the type of Award(s) to be granted to Non-Employee Directors, the number of Shares to be subject to Non-Employee Director Awards, the conditions on which such Awards shall be granted,
become exercisable and/or payable and expire, and such other terms and conditions as the Administrator shall determine in its sole discretion. The Non-Employee Director Equity Compensation Policy may be modified by the Administrator from time to
time in its sole discretion. 
 (b) Director Limit. Notwithstanding any provision to the contrary in the Plan or in the Non-Employee
Director Equity Compensation Policy, the sum of the grant date fair value of equity-based Awards and the amount of any cash-based Awards granted to a Non-Employee Director during any calendar year shall not exceed $500,000 (the “Director
Limit”). 

  
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 ARTICLE 5. 

PROVISIONS APPLICABLE TO AWARDS INTENDED TO QUALIFY AS 

PERFORMANCE-BASED COMPENSATION 

5.1 Purpose. The Administrator may, in its sole discretion, (a) determine whether an Award is intended to qualify as
Performance-Based Compensation and (b) at any time after any such determination, alter such intent for any or no reason. If the Administrator, in its sole discretion, decides to grant an Award that is intended to qualify as Performance-Based
Compensation (other than an Option or Stock Appreciation Right), then the provisions of this Article 5 shall control over any contrary provision contained in the Plan or any applicable Program; provided that, if after such decision the
Administrator alters such intention for any reason, the provisions of this Article 5 shall no longer control over any other provision contained in the Plan or any applicable Program. The Administrator, in its sole discretion, may (i) grant
Awards to Eligible Individuals that are based on Performance Criteria or Performance Goals or any such other criteria and goals as the Administrator shall establish, but that do not satisfy the requirements of this Article 5 and that are not
intended to qualify as Performance-Based Compensation and (ii) subject any Awards intended to qualify as Performance-Based Compensation to additional conditions and restrictions unrelated to any Performance Criteria or Performance Goals
(including, without limitation, continued employment or service requirements) to the extent such Awards otherwise satisfy the requirements of this Article 5 with respect to the Performance Criteria and Performance Goals applicable thereto. Unless
otherwise specified by the Administrator at the time of grant, the Performance Criteria with respect to an Award intended to be Performance-Based Compensation payable to a Covered Employee shall be determined on the basis of Applicable Accounting
Standards. 
 5.2 Procedures with Respect to Performance-Based Awards. To the extent necessary to comply with the requirements of
Section 162(m)(4)(C) of the Code, with respect to any Award which is intended to qualify as Performance-Based Compensation, no later than 90 days following the commencement of any Performance Period or any designated fiscal period or period of
service (or such earlier time as may be required under Section 162(m) of the Code), the Administrator shall, in writing, (a) designate one or more Eligible Individuals, (b) select the Performance Criteria applicable to the Performance
Period, (c) establish the Performance Goals, and amounts of such Awards, as applicable, which may be earned for such Performance Period based on the Performance Criteria, and (d) specify the relationship between Performance Criteria and
the Performance Goals and the amounts of such Awards, as applicable, to be earned by each Covered Employee for such Performance Period. Following the completion of each Performance Period, the Administrator shall certify in writing whether and the
extent to which the applicable Performance Goals have been achieved for such Performance Period. In determining the amount earned under such Awards, the Administrator (i) shall, unless otherwise provided in an Award Agreement, have the right to
reduce or eliminate the amount payable at a given level of performance to take into account additional factors that the Administrator may deem relevant, including the assessment of individual or corporate performance for the Performance Period, but
(ii) shall in no event have the right to increase the amount payable for any reason. 

  
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 5.3 Payment of Performance-Based Awards. Unless otherwise provided in the applicable
Program or Award Agreement and only to the extent otherwise permitted by Section 162(m) of the Code, as to an Award that is intended to qualify as Performance-Based Compensation, the Holder must be employed by the Company or a Subsidiary throughout
the Performance Period. Unless otherwise provided in the applicable Program or Award Agreement, a Holder shall be eligible to receive payment pursuant to such Awards for a Performance Period only if and to the extent the Performance Goals for such
Performance Period are achieved. 
 5.4 Additional Limitations. Notwithstanding any other provision of the Plan and except as
otherwise determined by the Administrator, any Award which is granted to an Eligible Individual and is intended to qualify as Performance-Based Compensation shall be subject to any additional limitations set forth in Section 162(m) of the Code
or any regulations or rulings issued thereunder that are requirements for qualification as Performance-Based Compensation, and the Plan and the applicable Program and Award Agreement shall be deemed amended to the extent necessary to conform to such
requirements. 
 ARTICLE 6. 

GRANTING OF OPTIONS AND STOCK APPRECIATION RIGHTS 

6.1 Granting of Options and Stock Appreciation Rights to Eligible Individuals. The Administrator is authorized to grant Options and
Stock Appreciation Rights to Eligible Individuals from time to time, in its sole discretion, on such terms and conditions as it may determine, which shall not be inconsistent with the Plan. 

6.2 Qualification of Incentive Stock Options. The Administrator may grant Options intended to qualify as Incentive Stock Options only to
employees of the Company, any of the Company’s present or future “parent corporations” or “subsidiary corporations” as defined in Sections 424(e) or (f) of the Code, respectively, and any other entities the employees of
which are eligible to receive Incentive Stock Options under the Code. No person who qualifies as a Greater Than 10% Stockholder may be granted an Incentive Stock Option unless such Incentive Stock Option conforms to the applicable provisions of
Section 422 of the Code. To the extent that the aggregate fair market value of stock with respect to which “incentive stock options” (within the meaning of Section 422 of the Code, but without regard to Section 422(d) of the
Code) are exercisable for the first time by a Holder during any calendar year under the Plan, and all other plans of the Company and any parent corporation or subsidiary corporation thereof (as defined in Section 424(e) and 424(f) of the Code,
respectively), exceeds $100,000, the Options shall be treated as Non-Qualified Stock Options to the extent required by Section 422 of the Code. The rule set forth in the immediately preceding sentence shall be applied by taking Options and
other “incentive stock options” into account in the order in which they were granted and the fair market value of stock shall be determined as of the time the respective options were granted. Any interpretations and rules under the Plan
with respect to Incentive Stock Options shall be consistent with the provisions of Section 422 of the Code. Neither the Company nor the Administrator shall have any liability to a Holder, or any other Person, (a) if an Option (or any part
thereof) which is intended to qualify as an Incentive Stock Option fails to qualify as an Incentive Stock Option or (b) for any action or omission by the Company or the Administrator that causes an Option not to qualify as an Incentive Stock
Option, including without limitation, the conversion of an Incentive Stock Option to a Non-Qualified Stock Option or the grant of an Option intended as an Incentive Stock Option that fails to satisfy the requirements under the Code applicable to an
Incentive Stock Option. 

  
 14 

 6.3 Option and Stock Appreciation Right Exercise Price. The exercise price per Share
subject to each Option and Stock Appreciation Right shall be set by the Administrator, but shall not be less than 100% of the Fair Market Value of a Share on the date the Option or Stock Appreciation Right, as applicable, is granted (or, as to
Incentive Stock Options, on the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code). In addition, in the case of Incentive Stock Options granted to a Greater Than 10% Stockholder, such price shall not be
less than 110% of the Fair Market Value of a Share on the date the Option is granted (or the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code). Notwithstanding the foregoing, in the case of an Option
or Stock Appreciation Right that is a Substitute Award, the exercise price per share of the Shares subject to such Option or Stock Appreciation Right, as applicable, may be less than the Fair Market Value per share on the date of grant; provided
that the exercise price of any Substitute Award shall be determined in accordance with the applicable requirements of Section 424 and 409A of the Code. 

6.4 Option and SAR Term. The term of each Option (the “Option Term”) and the term of each Stock Appreciation Right (the
“SAR Term”) shall be set by the Administrator in its sole discretion; provided, however, that the Option Term or SAR Term, as applicable, shall not be more than (a) ten (10) years from the date the Option or
Stock Appreciation Right, as applicable, is granted to an Eligible Individual (other than, in the case of Incentive Stock Options, a Greater Than 10% Stockholder), or (b) five (5) years from the date an Incentive Stock Option is granted to
a Greater Than 10% Stockholder. Except as limited by the requirements of Section 409A or Section 422 of the Code and regulations and rulings thereunder or the first sentence of this Section 6.4 and without limiting the Company’s
rights under Section 11.7, the Administrator may extend the Option Term of any outstanding Option or the SAR Term of any outstanding Stock Appreciation Right, and may extend the time period during which vested Options or Stock Appreciation
Rights may be exercised, in connection with any Termination of Service of the Holder or otherwise, and may amend, subject to Section 11.7 and 13.1, any other term or condition of such Option or Stock Appreciation Right relating to such
Termination of Service of the Holder or otherwise. 
 6.5 Option and SAR Vesting. The period during which the right to exercise, in
whole or in part, an Option or Stock Appreciation Right vests in the Holder shall be set by the Administrator and set forth in the applicable Award Agreement. Unless otherwise determined by the Administrator in the Award Agreement, the applicable
Program or by action of the Administrator following the grant of the Option or Stock Appreciation Right, (a) no portion of an Option or Stock Appreciation Right which is unexercisable at a Holder’s Termination of Service shall thereafter
become exercisable and (b) the portion of an Option or Stock Appreciation Right that is unexercisable at a Holder’s Termination of Service shall automatically expire thirty (30) days following the date of a Termination of Service due
to death or disability and on the date of any a Termination of Service for any other reason. 

  
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 6.6 Substitution of Stock Appreciation Rights; Early Exercise of Options. The
Administrator may provide in the applicable Program or Award Agreement evidencing the grant of an Option that the Administrator, in its sole discretion, shall have the right to substitute a Stock Appreciation Right for such Option at any time prior
to or upon exercise of such Option; provided that such Stock Appreciation Right shall be exercisable with respect to the same number of Shares for which such substituted Option would have been exercisable, and shall also have the same exercise
price, vesting schedule and remaining term as the substituted Option. The Administrator may provide in the terms of an Award Agreement that the Holder may exercise an Option in whole or in part prior to the full vesting of the Option in exchange for
unvested shares of Restricted Stock with respect to any unvested portion of the Option so exercised. Shares of Restricted Stock acquired upon the exercise of any unvested portion of an Option shall be subject to such terms and conditions as the
Administrator shall determine. 
 ARTICLE 7. 

EXERCISE OF OPTIONS AND STOCK APPRECIATION RIGHTS 

7.1 Exercise and Payment. An exercisable Option or Stock Appreciation Right may be exercised in whole or in part. However, an Option or
Stock Appreciation Right shall not be exercisable with respect to fractional Shares and the Administrator may require that, by the terms of the Option or Stock Appreciation Right, a partial exercise must be with respect to a minimum number of
Shares. Payment of the amounts payable with respect to Stock Appreciation Rights pursuant to this Article 7 shall be in cash, Shares (based on its Fair Market Value as of the date the Stock Appreciation Right is exercised), or a combination of both,
as determined by the Administrator. 
 7.2 Manner of Exercise. Except as set forth in Section 7.3, all or a portion of an
exercisable Option or Stock Appreciation Right shall be deemed exercised upon delivery of all of the following to the Secretary of the Company, the stock plan administrator of the Company or such other person or entity designated by the
Administrator, or his, her or its office, as applicable: 
 (a) A written or electronic notice complying with the applicable rules
established by the Administrator stating that the Option or Stock Appreciation Right, or a portion thereof, is exercised. The notice shall be signed or otherwise acknowledged electronically by the Holder or other person then entitled to exercise the
Option or Stock Appreciation Right or such portion thereof; 
 (b) Such representations and documents as the Administrator, in its sole
discretion, deems necessary or advisable to effect compliance with Applicable Law; 
 (c) In the event that the Option shall be
exercised pursuant to Section 11.3 by any person or persons other than the Holder, appropriate proof of the right of such person or persons to exercise the Option or Stock Appreciation Right, as determined in the sole discretion of the
Administrator; and 
 (d) Full payment of the exercise price and applicable withholding taxes for the Shares with respect to which the
Option or Stock Appreciation Right, or portion thereof, is exercised, in a manner permitted by the Administrator in accordance with Sections 11.1 and 11.2. 

  
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 7.3 Expiration of Option Term or SAR Term: Automatic Exercise of In-The-Money Options and
Stock Appreciation Rights. Unless otherwise provided by the Administrator in an Award Agreement or otherwise or as otherwise directed by an Option or Stock Appreciation Rights Holder in writing to the Company, each vested and exercisable Option
and Stock Appreciation Right outstanding on the Automatic Exercise Date with an exercise price per Share that is less than the Fair Market Value per Share as of such date shall automatically and without further action by the Option or Stock
Appreciation Rights Holder or the Company be exercised on the Automatic Exercise Date. In the sole discretion of the Administrator, payment of the exercise price of any such Option shall be made pursuant to Section 11.1(b) or 11.1(c) and the
Company or any Subsidiary shall be entitled to deduct or withhold an amount sufficient to satisfy all taxes associated with such exercise in accordance with Section 11.2. Unless otherwise determined by the Administrator, this Section 7.3
shall not apply to an Option or Stock Appreciation Right if the Holder of such Option or Stock Appreciation Right incurs a Termination of Service on or before the Automatic Exercise Date. For the avoidance of doubt, no Option or Stock Appreciation
Right with an exercise price per Share that is equal to or greater than the Fair Market Value per Share on the Automatic Exercise Date shall be exercised pursuant to this Section 7.3. 

7.4 Notification Regarding Disposition. The Holder shall give the Company prompt written or electronic notice of any disposition of
Shares acquired by exercise of an Incentive Stock Option which occurs within (a) two years from the date of granting (including the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code) such Option to
such Holder, or (b) one year after the date of transfer of such Shares to such Holder. Such notice shall specify the date of such disposition or other transfer and the amount realized, in cash, other property, assumption of indebtedness or
other consideration, by the Holder in such disposition or other transfer. 
 ARTICLE 8. 

AWARD OF RESTRICTED STOCK 

8.1 Award of Restricted Stock. The Administrator is authorized to grant Restricted Stock to Eligible Individuals, and shall determine
the terms and conditions, including the restrictions applicable to each award of Restricted Stock, which terms and conditions shall not be inconsistent with the Plan or any applicable Program, and may impose such conditions on the issuance of such
Restricted Stock as it deems appropriate. The Administrator shall establish the purchase price, if any, and form of payment for Restricted Stock; provided, however, that if a purchase price is charged, such purchase price shall be no
less than the par value, if any, of the Shares to be purchased, unless otherwise permitted by Applicable Law. In all cases, legal consideration shall be required for each issuance of Restricted Stock to the extent required by Applicable Law. 

8.2 Rights as Stockholders. Subject to Section 8.4, upon issuance of Restricted Stock, the Holder shall have, unless otherwise
provided by the Administrator, all the rights of a stockholder with respect to said Shares, subject to the restrictions in the Plan, any applicable Program and/or the applicable Award Agreement, including the right to receive all dividends and other
distributions paid or made with respect to the Shares to the extent such dividends and other distributions have a record date that is on or after the date on which the Holder to whom such Shares are granted becomes the record holder of such
Restricted Stock; provided, however, that, in the sole discretion of the Administrator, any extraordinary distributions with respect to the 

  
 17 

 
Shares may be subject to the restrictions set forth in Section 8.3. In addition, with respect to a share of Restricted Stock with performance-based vesting, dividends which are paid prior to
vesting shall only be paid out to the Holder to the extent that the performance-based vesting conditions are subsequently satisfied and the share of Restricted Stock vests. 

8.3 Restrictions. All shares of Restricted Stock (including any shares received by Holders thereof with respect to shares of Restricted
Stock as a result of stock dividends, stock splits or any other form of recapitalization) shall be subject to such restrictions and vesting requirements as the Administrator shall provide in the applicable Program or Award Agreement. By action taken
after the Restricted Stock is issued, the Administrator may, on such terms and conditions as it may determine to be appropriate, accelerate the vesting of such Restricted Stock by removing any or all of the restrictions imposed by the terms of the
applicable Program or Award Agreement. 
 8.4 Repurchase or Forfeiture of Restricted Stock. Except as otherwise determined by the
Administrator, if no price was paid by the Holder for the Restricted Stock, upon a Termination of Service during the applicable restriction period, the Holder’s rights in unvested Restricted Stock then subject to restrictions shall lapse, and
such Restricted Stock shall be surrendered to the Company and cancelled without consideration on the date of such Termination of Service. If a price was paid by the Holder for the Restricted Stock, upon a Termination of Service during the applicable
restriction period, the Company shall have the right to repurchase from the Holder the unvested Restricted Stock then subject to restrictions at a cash price per share equal to the price paid by the Holder for such Restricted Stock or such other
amount as may be specified in the applicable Program or Award Agreement. Notwithstanding the foregoing, the Administrator, in its sole discretion, may provide that upon certain events, including, without limitation, a Change in Control, the
Holder’s death, retirement or disability or any other specified Termination of Service or any other event, the Holder’s rights in unvested Restricted Stock then subject to restrictions shall not lapse, such Restricted Stock shall vest and
cease to be forfeitable and, if applicable, the Company shall cease to have a right of repurchase. 
 8.5 Section 83(b) Election.
If a Holder makes an election under Section 83(b) of the Code to be taxed with respect to the Restricted Stock as of the date of transfer of the Restricted Stock rather than as of the date or dates upon which the Holder would otherwise be
taxable under Section 83(a) of the Code, the Holder shall be required to deliver a copy of such election to the Company promptly after filing such election with the Internal Revenue Service along with proof of the timely filing thereof with the
Internal Revenue Service. 
 ARTICLE 9. 

AWARD OF RESTRICTED STOCK UNITS 

9.1 Grant of Restricted Stock Units. The Administrator is authorized to grant Awards of Restricted Stock Units to any Eligible
Individual selected by the Administrator in such amounts and subject to such terms and conditions as determined by the Administrator. 
 9.2
Term. Except as otherwise provided herein, the term of a Restricted Stock Unit award shall be set by the Administrator in its sole discretion. 

  
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 9.3 Purchase Price. The Administrator shall specify the purchase price, if any, to be paid
by the Holder to the Company with respect to any Restricted Stock Unit award; provided, however, that value of the consideration shall not be less than the par value of a Share, unless otherwise permitted by Applicable Law. 

9.4 Vesting of Restricted Stock Units. At the time of grant, the Administrator shall specify the date or dates on which the Restricted
Stock Units shall become fully vested and nonforfeitable, and may specify such conditions to vesting as it deems appropriate, including, without limitation, vesting based upon the Holder’s duration of service to the Company or any Subsidiary,
one or more Performance Criteria, Company performance, individual performance or other specific criteria, in each case on a specified date or dates or over any period or periods, as determined by the Administrator. 

9.5 Maturity and Payment. At the time of grant, the Administrator shall specify the maturity date applicable to each grant of Restricted
Stock Units, which shall be no earlier than the vesting date or dates of the Award and may be determined at the election of the Holder (if permitted by the applicable Award Agreement); provided that, except as otherwise determined by the
Administrator, and subject to compliance with Section 409A, in no event shall the maturity date relating to each Restricted Stock Unit occur following the later of (a) the 15th day of
the third month following the end of calendar year in which the applicable portion of the Restricted Stock Unit vests; or (b) the 15th day of the third month following the end of the
Company’s fiscal year in which the applicable portion of the Restricted Stock Unit vests. On the maturity date, the Company shall, in accordance with the applicable Award Agreement and subject to Section 11.4(f), transfer to the Holder one
unrestricted, fully transferable Share for each Restricted Stock Unit scheduled to be paid out on such date and not previously forfeited, or in the sole discretion of the Administrator, an amount in cash equal to the Fair Market Value of such Shares
on the maturity date or a combination of cash and Common Stock as determined by the Administrator. 
 9.6 Payment upon Termination of
Service. An Award of Restricted Stock Units shall only be payable while the Holder is an Employee, a Consultant or a member of the Board, as applicable; provided, however, that the Administrator, in its sole discretion, may provide
(in an Award Agreement or otherwise) that a Restricted Stock Unit award may be paid subsequent to a Termination of Service in certain events, including a Change in Control, the Holder’s death, retirement or disability or any other specified
Termination of Service. 
 ARTICLE 10. 

AWARD OF OTHER STOCK OR CASH BASED AWARDS AND DIVIDEND 

EQUIVALENTS 
 10.1 Other
Stock or Cash Based Awards. The Administrator is authorized to (a) grant Other Stock or Cash Based Awards, including awards entitling a Holder to receive Shares or cash to be delivered immediately or in the future, to any Eligible
Individual and (b) determine whether such Other Stock or Cash Based Awards shall be Performance-Based Compensation. Subject to the provisions of the Plan and any applicable Program, the Administrator shall determine the terms and conditions of
each Other Stock or Cash Based Award, including the term of the Award, any exercise or purchase price, performance goals, including the Performance Criteria, transfer 

  
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restrictions, vesting conditions and other terms and conditions applicable thereto, which shall be set forth in the applicable Award Agreement. Other Stock or Cash Based Awards may be paid in
cash, Shares, or a combination of cash and Shares, as determined by the Administrator, and may be available as a form of payment in the settlement of other Awards granted under the Plan, as stand-alone payments, as a part of a bonus, deferred bonus,
deferred compensation or other arrangement, and/or as payment in lieu of compensation to which an Eligible Individual is otherwise entitled. 

10.2 Dividend Equivalents. Dividend Equivalents may be granted by the Administrator, either alone or in tandem with another Award, based
on dividends declared on the Common Stock, to be credited as of dividend payment dates during the period between the date the Dividend Equivalents are granted to a Holder and the date such Dividend Equivalents terminate or expire, as determined by
the Administrator. Such Dividend Equivalents shall be converted to cash or additional Shares by such formula and at such time and subject to such restrictions and limitations as may be determined by the Administrator. In addition, Dividend
Equivalents with respect to an Award with performance-based vesting that are based on dividends paid prior to the vesting of such Award shall only be paid out to the Holder to the extent that the performance-based vesting conditions are subsequently
satisfied and the Award vests. Notwithstanding the foregoing, no Dividend Equivalents shall be payable with respect to Options or Stock Appreciation Rights. 

ARTICLE 11. 
 ADDITIONAL
TERMS OF AWARDS 
 11.1 Payment. The Administrator shall determine the method or methods by which payments by any Holder with
respect to any Awards granted under the Plan shall be made, including, without limitation: (a) cash or check, (b) Shares (including, in the case of payment of the exercise price of an Award, Shares issuable pursuant to the exercise of the
Award) held for any minimum period of time as may be established by the Administrator having a Fair Market Value on the date of delivery equal to the aggregate payments required, (c) delivery of a written or electronic notice that the Holder
has placed a market sell order with a broker acceptable to the Company with respect to Shares then issuable upon exercise or vesting of an Award, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to
the Company in satisfaction of the aggregate payments required; provided that payment of such proceeds is then made to the Company upon settlement of such sale, (d) other form of legal consideration acceptable to the Administrator in its
sole discretion, or (e) any combination of the above permitted forms of payment. Notwithstanding any other provision of the Plan to the contrary, no Holder who is a Director or an “executive officer” of the Company within the meaning
of Section 13(k) of the Exchange Act shall be permitted to make payment with respect to any Awards granted under the Plan, or continue any extension of credit with respect to such payment, with a loan from the Company or a loan arranged by the
Company in violation of Section 13(k) of the Exchange Act. 
 11.2 Tax Withholding. The Company or any Subsidiary shall have the
authority and the right to deduct or withhold, or require a Holder to remit to the Company, an amount sufficient to satisfy federal, state, local and foreign taxes (including the Holder’s FICA, employment tax or other social security
contribution obligation) required by law to be withheld with respect to any taxable event concerning a Holder arising as a result of the Plan or any Award. The Administrator 

  
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may, in its sole discretion and in satisfaction of the foregoing requirement, allow a Holder to satisfy such obligations by any payment means described in Section 11.1 hereof, including
without limitation, by allowing such Holder to have the Company or any Subsidiary withhold Shares otherwise issuable under an Award (or allow the surrender of Shares). The number of Shares which may be so withheld or surrendered shall be no greater
than the number of Shares which have a fair market value on the date of withholding or repurchase equal to the aggregate amount of such liabilities based on the minimum statutory withholding rates for federal, state, local and foreign income tax and
payroll tax purposes that are applicable to such supplemental taxable income (or such other number as would not result in adverse financial accounting consequences for the Company or any of its Subsidiaries). The Administrator shall determine the
fair market value of the Shares, consistent with applicable provisions of the Code, for tax withholding obligations due in connection with a broker-assisted cashless Option or Stock Appreciation Right exercise involving the sale of Shares to pay the
Option or Stock Appreciation Right exercise price or any tax withholding obligation. 
 11.3 Transferability of Awards. 

(a) Except as otherwise provided in Sections 11.3(b) and 11.3(c): 

(i) No Award under the Plan may be sold, pledged, assigned or transferred in any manner other than (A) by will or the laws of descent and
distribution or (B) subject to the consent of the Administrator, pursuant to a DRO, unless and until such Award has been exercised or the Shares underlying such Award have been issued, and all restrictions applicable to such Shares have lapsed;

 (ii) No Award or interest or right therein shall be liable for or otherwise subject to the debts, contracts or engagements of the
Holder or the Holder’s successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, hypothecation, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by
operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy) unless and until such Award has been exercised, or the Shares underlying such Award have been issued, and all restrictions
applicable to such Shares have lapsed, and any attempted disposition of an Award prior to satisfaction of these conditions shall be null and void and of no effect, except to the extent that such disposition is permitted by Section 11.3(a)(i);
and 
 (iii) During the lifetime of the Holder, only the Holder may exercise any exercisable portion of an Award granted to such Holder
under the Plan, unless it has been disposed of pursuant to a DRO. After the death of the Holder, any exercisable portion of an Award may, prior to the time when such portion becomes unexercisable under the Plan or the applicable Program or Award
Agreement, be exercised by the Holder’s personal representative or by any person empowered to do so under the deceased Holder’s will or under the then-applicable laws of descent and distribution. 

(b) Notwithstanding Section 11.3(a), the Administrator, in its sole discretion, may determine to permit a Holder or a Permitted Transferee
of such Holder to transfer an Award other than an Incentive Stock Option (unless such Incentive Stock Option is intended to become a 

  
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Nonqualified Stock Option) to any one or more Permitted Transferees of such Holder, subject to the following terms and conditions: (i) an Award transferred to a Permitted Transferee shall
not be assignable or transferable by the Permitted Transferee other than (A) to another Permitted Transferee of the applicable Holder or (B) by will or the laws of descent and distribution or, subject to the consent of the Administrator,
pursuant to a DRO; (ii) an Award transferred to a Permitted Transferee shall continue to be subject to all the terms and conditions of the Award as applicable to the original Holder (other than the ability to further transfer the Award to any
Person other than another Permitted Transferee of the applicable Holder); and (iii) the Holder (or transferring Permitted Transferee) and the receiving Permitted Transferee shall execute any and all documents requested by the Administrator,
including, without limitation documents to (A) confirm the status of the transferee as a Permitted Transferee, (B) satisfy any requirements for an exemption for the transfer under Applicable Law and (C) evidence the transfer. In
addition, and further notwithstanding Section 11.3(a), hereof, the Administrator, in its sole discretion, may determine to permit a Holder to transfer Incentive Stock Options to a trust that constitutes a Permitted Transferee if, under
Section 671 of the Code and other Applicable Law, the Holder is considered the sole beneficial owner of the Incentive Stock Option while it is held in the trust. 

(c) Notwithstanding Section 11.3(a), a Holder may, in the manner determined by the Administrator, designate a beneficiary to exercise the
rights of the Holder and to receive any distribution with respect to any Award upon the Holder’s death. A beneficiary, legal guardian, legal representative, or other person claiming any rights pursuant to the Plan is subject to all terms and
conditions of the Plan and any Program or Award Agreement applicable to the Holder and any additional restrictions deemed necessary or appropriate by the Administrator. If the Holder is married or a domestic partner in a domestic partnership
qualified under Applicable Law and resides in a community property state, a designation of a person other than the Holder’s spouse or domestic partner, as applicable, as the Holder’s beneficiary with respect to more than 50% of the
Holder’s interest in the Award shall not be effective without the prior written or electronic consent of the Holder’s spouse or domestic partner. If no beneficiary has been designated or survives the Holder, payment shall be made to the
person entitled thereto pursuant to the Holder’s will or the laws of descent and distribution. Subject to the foregoing, a beneficiary designation may be changed or revoked by a Holder at any time; provided that the change or revocation
is delivered in writing to the Administrator prior to the Holder’s death. 
 11.4 Conditions to Issuance of Shares. 

(a) The Administrator shall determine the methods by which Shares shall be delivered or deemed to be delivered to Holders. Notwithstanding
anything herein to the contrary, the Company shall not be required to issue or deliver any certificates or make any book entries evidencing Shares pursuant to the exercise of any Award, unless and until the Administrator has determined, with advice
of counsel, that the issuance of such Shares is in compliance with Applicable Law and the Shares are covered by an effective registration statement or applicable exemption from registration. In addition to the terms and conditions provided herein,
the Administrator may require that a Holder make such reasonable covenants, agreements and representations as the Administrator, in its sole discretion, deems advisable in order to comply with Applicable Law. 

  
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 (b) All share certificates delivered pursuant to the Plan and all Shares issued pursuant to book
entry procedures are subject to any stop-transfer orders and other restrictions as the Administrator deems necessary or advisable to comply with Applicable Law. The Administrator may place legends on any share certificate or book entry to reference
restrictions applicable to the Shares (including, without limitation, restrictions applicable to Restricted Stock). 
 (c) The Administrator
shall have the right to require any Holder to comply with any timing or other restrictions with respect to the settlement, distribution or exercise of any Award, including a window-period limitation, as may be imposed in the sole discretion of the
Administrator. 
 (d) No fractional Shares shall be issued and the Administrator, in its sole discretion, shall determine whether cash shall
be given in lieu of fractional Shares or whether such fractional Shares shall be eliminated by rounding down. 
 (e) The Company, in its sole
discretion, may (i) retain physical possession of any stock certificate evidencing Shares until any restrictions thereon shall have lapsed and/or (ii) require that the stock certificates evidencing such Shares be held in custody by a
designated escrow agent (which may but need not be the Company) until the restrictions thereon shall have lapsed, and that the Holder deliver a stock power, endorsed in blank, relating to such Shares. 

(f) Notwithstanding any other provision of the Plan, unless otherwise determined by the Administrator or required by Applicable Law, the
Company shall not deliver to any Holder certificates evidencing Shares issued in connection with any Award and instead such Shares shall be recorded in the books of the Company (or, as applicable, its transfer agent or stock plan administrator).

 11.5 Forfeiture and Claw-Back Provisions. All Awards (including any proceeds, gains or other economic benefit actually or
constructively received by a Holder upon any receipt or exercise of any Award or upon the receipt or resale of any Shares underlying the Award and any payments of a portion of an incentive-based bonus pool allocated to a Holder) shall be subject to
the provisions of any claw-back policy implemented by the Company, including, without limitation, any claw-back policy adopted to comply with the requirements of Applicable Law, including, without limitation, the Dodd-Frank Wall Street Reform and
Consumer Protection Act and any rules or regulations promulgated thereunder, whether or not such claw-back policy was in place at the time of grant of an Award, to the extent set forth in such claw-back policy and/or in the applicable Award
Agreement. 
 11.6 Prohibition on Repricing. Subject to Section 13.2, the Administrator shall not, without the approval of the
stockholders of the Company, (a) authorize the amendment of any outstanding Option or Stock Appreciation Right to reduce its price per Share, or (b) cancel any Option or Stock Appreciation Right in exchange for cash or another Award when
the Option or Stock Appreciation Right price per Share exceeds the Fair Market Value of the underlying Shares. Furthermore, for purposes of this Section 11.6, except in connection with a corporate transaction involving the Company (including,
without limitation, any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination or exchange of shares), the terms of outstanding Awards may not be amended to

  
 23 

 
reduce the exercise price per Share of outstanding Options or Stock Appreciation Rights or cancel outstanding Options or Stock Appreciation Rights in exchange for cash, other Awards or Options or
Stock Appreciation Rights with an exercise price per Share that is less than the exercise price per Share of the original Options or Stock Appreciation Rights without the approval of the stockholders of the Company. 

11.7 Amendment of Awards. Subject to Applicable Law, the Administrator 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 settlement, and converting an Incentive Stock Option to a Non-Qualified Stock Option. The Holder’s consent to such action
shall be required unless (a) the Administrator determines that the action, taking into account any related action, would not materially and adversely affect the Holder, or (b) the change is otherwise permitted under the Plan (including,
without limitation, under Section 13.2 or 13.10). 
 11.8 Data Privacy. As a condition of receipt of any Award, each Holder
explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of personal data as described in this Section 11.8 by and among, as applicable, the Company and its Subsidiaries for the exclusive purpose
of implementing, administering and managing the Holder’s participation in the Plan. The Company and its Subsidiaries may hold certain personal information about a Holder, including but not limited to, the Holder’s name, home address and
telephone number, date of birth, social security or insurance number or other identification number, salary, nationality, job title(s), any shares of stock held in the Company or any of its Subsidiaries, details of all Awards, in each case, for the
purpose of implementing, managing and administering the Plan and Awards (the “Data”). The Company and its Subsidiaries may transfer the Data amongst themselves as necessary for the purpose of implementation, administration and
management of a Holder’s participation in the Plan, and the Company and its Subsidiaries may each further transfer the Data to any third parties assisting the Company and its Subsidiaries in the implementation, administration and management of
the Plan. These recipients may be located in the Holder’s country, or elsewhere, and the Holder’s country may have different data privacy laws and protections than the recipients’ country. Through acceptance of an Award, each Holder
authorizes such recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Holder’s participation in the Plan, including any requisite
transfer of such Data as may be required to a broker or other third party with whom the Company or any of its Subsidiaries or the Holder may elect to deposit any Shares. The Data related to a Holder will be held only as long as is necessary to
implement, administer, and manage the Holder’s participation in the Plan. A Holder may, at any time, view the Data held by the Company with respect to such Holder, request additional information about the storage and processing of the Data with
respect to such Holder, recommend any necessary corrections to the Data with respect to the Holder or refuse or withdraw the consents herein in writing, in any case without cost, by contacting his or her local human resources representative. The
Company may cancel Holder’s ability to participate in the Plan and, in the Administrator’s discretion, the Holder may forfeit any outstanding Awards if the Holder refuses or withdraws his or her consents as described herein. For more
information on the consequences of refusal to consent or withdrawal of consent, Holders may contact their local human resources representative. 

  
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 ARTICLE 12. 

ADMINISTRATION 
 12.1
Administrator. The Committee shall administer the Plan (except as otherwise permitted herein). To the extent necessary to comply with Rule 16b-3 of the Exchange Act, and with respect to Awards that are intended to be Performance-Based
Compensation, including Options and Stock Appreciation Rights, then the Committee shall take all action with respect to such Awards, and the individuals taking such action shall consist solely of two or more Non-Employee Directors, each of whom is
intended to qualify as both a “non-employee director” as defined by Rule 16b-3 of the Exchange Act or any successor rule and an “outside director” for purposes of Section 162(m) of the Code. Additionally, to the extent
required by Applicable Law, each of the individuals constituting the Committee shall be an “independent director” under the rules of any securities exchange or automated quotation system on which the Shares are listed, quoted or traded.
Notwithstanding the foregoing, any action taken by the Committee shall be valid and effective, whether or not members of the Committee at the time of such action are later determined not to have satisfied the requirements for membership set forth in
this Section 12.1 or the Organizational Documents. Except as may otherwise be provided in the Organizational Documents or as otherwise required by Applicable Law, (a) appointment of Committee members shall be effective upon acceptance of
appointment, (b) Committee members may resign at any time by delivering written or electronic notice to the Board and (c) vacancies in the Committee may only be filled by the Board. Notwithstanding the foregoing, (i) the full Board,
acting by a majority of its members in office, shall conduct the general administration of the Plan with respect to Awards granted to Non-Employee Directors and, with respect to such Awards, the terms “Administrator” as used in the Plan
shall be deemed to refer to the Board and (ii) the Board or Committee may delegate its authority hereunder to the extent permitted by Section 12.6. 

12.2 Duties and Powers of Administrator. It shall be the duty of the Administrator to conduct the general administration of the Plan in
accordance with its provisions. The Administrator shall have the power to interpret the Plan, all Programs and Award Agreements, and to adopt such rules for the administration, interpretation and application of the Plan and any Program as are not
inconsistent with the Plan, to interpret, amend or revoke any such rules and to amend the Plan or any Program or Award Agreement; provided that the rights or obligations of the Holder of the Award that is the subject of any such Program or Award
Agreement are not materially and adversely affected by such amendment, unless the consent of the Holder is obtained or such amendment is otherwise permitted under Section 11.5 or Section 13.10. In its sole discretion, the Board may at any
time and from time to time exercise any and all rights and duties of the Committee in its capacity as the Administrator under the Plan except with respect to matters which under Rule 16b-3 under the Exchange Act or any successor rule, or
Section 162(m) of the Code, or any regulations or rules issued thereunder, or the rules of any securities exchange or automated quotation system on which the Shares are listed, quoted or traded are required to be determined in the sole
discretion of the Committee. 
 12.3 Action by the Administrator. Unless otherwise established by the Board, set forth in any
Organizational Documents or as required by Applicable Law, a majority of the Administrator shall constitute a quorum and the acts of a majority of the members present at any meeting at which a quorum is present, and acts approved in writing by all
members of the 

  
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Administrator in lieu of a meeting, shall be deemed the acts of the Administrator. Each member of the Administrator is entitled to, in good faith, rely or act upon any report or other information
furnished to that member by any officer or other employee of the Company or any Subsidiary, the Company’s independent certified public accountants, or any executive compensation consultant or other professional retained by the Company to assist
in the administration of the Plan. 
 12.4 Authority of Administrator. Subject to the Organizational Documents, any specific
designation in the Plan and Applicable Law, the Administrator has the exclusive power, authority and sole discretion to: 

(a) Designate Eligible Individuals to receive Awards; 

(b) Determine the type or types of Awards to be granted to each Eligible Individual (including, without limitation, any Awards granted in
tandem with another Award granted pursuant to the Plan); 
 (c) Determine the number of Awards to be granted and the number of Shares to
which an Award will relate; 
 (d) Determine the terms and conditions of any Award granted pursuant to the Plan, including, but not
limited to, the exercise price, grant price, purchase price, any Performance Criteria or performance criteria, any restrictions or limitations on the Award, any schedule for vesting, lapse of forfeiture restrictions or restrictions on the
exercisability of an Award, and accelerations or waivers thereof, and any provisions related to non-competition and claw-back and recapture of gain on an Award, based in each case on such considerations as the Administrator in its sole discretion
determines; 
 (e) Determine whether, to what extent, and under what circumstances an Award may be settled in, or the exercise price of
an Award may be paid in cash, Shares, other Awards, or other property, or an Award may be canceled, forfeited, or surrendered; 

(f) Prescribe the form of each Award Agreement, which need not be identical for each Holder; 

(g) Decide all other matters that must be determined in connection with an Award; 

(h) Establish, adopt, or revise any Programs, rules and regulations as it may deem necessary or advisable to administer the Plan; 

(i) Interpret the terms of, and any matter arising pursuant to, the Plan, any Program or any Award Agreement; 

(j) Make all other decisions and determinations that may be required pursuant to the Plan or as the Administrator deems necessary or
advisable to administer the Plan; and 

  
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 (k) Accelerate wholly or partially the vesting or lapse of restrictions of any Award or portion
thereof at any time after the grant of an Award, subject to whatever terms and conditions it selects and Section 13.2. 
 12.5
Decisions Binding. The Administrator’s interpretation of the Plan, any Awards granted pursuant to the Plan, any Program or any Award Agreement and all decisions and determinations by the Administrator with respect to the Plan are final,
binding and conclusive on all Persons. 
 12.6 Delegation of Authority. The Board or Committee may from time to time delegate to a
committee of one or more members of the Board or one or more officers of the Company the authority to grant or amend Awards or to take other administrative actions pursuant to this Article 12; provided, however, that in no event shall
an officer of the Company be delegated the authority to grant Awards to, or amend Awards held by, the following individuals: (a) individuals who are subject to Section 16 of the Exchange Act, (b) Covered Employees with respect to
Awards intended to constitute Performance Based Compensation, or (c) officers of the Company (or Directors) to whom authority to grant or amend Awards has been delegated hereunder; provided, further, that any delegation of administrative
authority shall only be permitted to the extent it is permissible under any Organizational Documents and Applicable Law (including, without limitation, Section 162(m) of the Code). Any delegation hereunder shall be subject to the restrictions
and limits that the Board or Committee specifies at the time of such delegation or that are otherwise included in the applicable Organizational Documents, and the Board or Committee, as applicable, may at any time rescind the authority so delegated
or appoint a new delegatee. At all times, the delegatee appointed under this Section 12.6 shall serve in such capacity at the pleasure of the Board or the Committee, as applicable, and the Board or the Committee may abolish any committee at any
time and re-vest in itself any previously delegated authority. 
 ARTICLE 13. 

MISCELLANEOUS PROVISIONS 

13.1 Amendment, Suspension or Termination of the Plan. 

(a) Except as otherwise provided in Section 13.1(b), the Plan may be wholly or partially amended or otherwise modified, suspended or
terminated at any time or from time to time by the Board; provided that, except as provided in Section 11.5 and Section 13.10, no amendment, suspension or termination of the Plan shall, without the consent of the Holder, materially
and adversely affect any rights or obligations under any Award theretofore granted or awarded, unless the Award itself otherwise expressly so provides. 

(b) Notwithstanding Section 13.1(a), the Board may not, except as provided in Section 13.2, take any of the following actions without
approval of the Company’s stockholders given within twelve (12) months before or after such action: (i) increase the limit imposed in Section 3.1 on the maximum number of Shares which may be issued under the Plan or the Award
Limit, (ii) reduce the price per share of any outstanding Option or Stock Appreciation Right granted under the Plan or take any action prohibited under Section 11.6, or (iii) cancel any Option or Stock Appreciation Right in exchange
for cash or another Award in violation of Section 11.6. 

  
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 (c) No Awards may be granted or awarded during any period of suspension or after termination of
the Plan, and notwithstanding anything herein to the contrary, in no event may any Award be granted under the Plan after the tenth (10th) anniversary of 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 (such anniversary, the “Expiration Date”). Any Awards that are outstanding on the Expiration Date shall remain in force according to the terms of the Plan,
the applicable Program and the applicable Award Agreement. 
 13.2 Changes in Common Stock or Assets of the Company, Acquisition or
Liquidation of the Company and Other Corporate Events. 
 (a) In the event of any stock dividend, stock split, combination or exchange of
shares, merger, consolidation or other distribution (other than normal cash dividends) of Company assets to stockholders, or any other change affecting the shares of the Company’s stock or the share price of the Company’s stock other than
an Equity Restructuring, the Administrator may make equitable adjustments, if any, to reflect such change with respect to: (i) the aggregate number and kind of Shares that may be issued under the Plan (including, but not limited to, adjustments
of the limitations in Section 3.1 on the maximum number and kind of Shares which may be issued under the Plan, and adjustments of the Award Limit ); (ii) the number and kind of Shares (or other securities or property) subject to
outstanding Awards; (iii) the terms and conditions of any outstanding Awards (including, without limitation, any applicable performance targets or criteria with respect thereto); (iv) the grant or exercise price per share for any
outstanding Awards under the Plan; and (v) the number and kind of Shares (or other securities or property) for which automatic grants are subsequently to be made to new and continuing Non-Employee Directors pursuant to Section 4.6. Any
adjustment affecting an Award intended as Performance-Based Compensation shall be made consistent with the requirements of Section 162(m) of the Code unless otherwise determined by the Administrator. 

(b) In the event of any transaction or event described in Section 13.2(a) or any unusual or nonrecurring transactions or events affecting
the Company, any Subsidiary of the Company, or the financial statements of the Company or any Subsidiary, or of changes in Applicable Law or Applicable Accounting Standards, the Administrator, in its sole discretion, and on such terms and conditions
as it deems appropriate, either by the terms of the Award or by action taken prior to the occurrence of such transaction or event, is hereby authorized to take any one or more of the following actions whenever the Administrator determines that such
action is appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to any Award under the Plan, to facilitate such transactions or events or to give
effect to such changes in Applicable Law or Applicable Accounting Standards: 
 (i) To provide for the termination of any such Award in
exchange for an amount of cash and/or other property with a value equal to the amount that would have been attained upon the exercise of such Award or realization of the Holder’s rights (and, for the avoidance of doubt, if as of the date of the
occurrence of the transaction or event described in this Section 13.2 the Administrator determines in good faith that no amount would have been attained upon the exercise of such Award or realization of the Holder’s rights, then such Award
may be terminated by the Company without payment); 

  
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 (ii) To provide that such Award be assumed by the successor or survivor corporation, or a parent
or subsidiary thereof, or shall be substituted for by similar options, rights or awards covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares
and applicable exercise or purchase price, in all cases, as determined by the Administrator; 
 (iii) To make adjustments in the number
and type of Shares of the Company’s stock (or other securities or property) subject to such Awards, and/or in the terms and conditions of (including the grant or exercise price), and the criteria included in, outstanding Awards and Awards which
may be granted in the future; 
 (iv) To provide that such Award shall be exercisable or payable or fully vested with respect to all
Shares covered thereby, notwithstanding anything to the contrary in the Plan or the applicable Program or Award Agreement; 
 (v) To
replace such Award with other rights or property selected by the Administrator; and/or 
 (vi) To provide that the Award cannot vest,
be exercised or become payable after such event. 
 (c) In connection with the occurrence of any Equity Restructuring, and notwithstanding
anything to the contrary in Sections 13.2(a) and 13.2(b): 
 (i) The number and type of securities subject to each outstanding Award
and the exercise price or grant price thereof, if applicable, shall be equitably adjusted (and the adjustments provided under this Section 13.2(c)(i) shall be nondiscretionary and shall be final and binding on the affected Holder and the
Company); and/or 
 (ii) The Administrator shall make such equitable adjustments, if any, as the Administrator, in its sole discretion,
may deem appropriate to reflect such Equity Restructuring with respect to the aggregate number and kind of Shares that may be issued under the Plan (including, but not limited to, adjustments of the limitation in Section 3.1 on the maximum
number and kind of Shares which may be issued under the Plan, and adjustments of the Award Limit,). 
 (d) Notwithstanding any other
provision of the Plan, in the event of a Change in Control, unless the Administrator elects to (i) terminate an Award in exchange for cash, rights or property, or (ii) cause an Award to become fully exercisable and no longer subject to any
forfeiture restrictions prior to the consummation of a Change in Control, pursuant to Section 13.2, (A) such Award (other than any portion subject to performance-based vesting) shall continue in effect or be assumed or an equivalent Award
substituted by the successor corporation or a parent or subsidiary of the successor corporation and (B) the portion of such Award subject to performance-based vesting shall be subject to the terms and conditions of the applicable Award
Agreement and, in the absence of applicable terms and conditions, the Administrator’s discretion. In the event an Award continues in effect or is assumed or an equivalent Award substituted, and a Holder incurs a Termination of Service without
“cause” (as such term is defined in the sole discretion of the Administrator, or as set forth in the Award Agreement relating to such Award) upon or within twelve (12) months following the Change in Control, then such Holder shall be
fully vested in such continued, assumed or substituted Award.1 

  
  

	1 	Note to Novan: Consider including so as to prevent successor from assuming unvested options and avoiding having to pay value for them in a Change in Control by terminating employees shortly after the Change in Control.

  
 29 

 (e) In the event that the successor corporation in a Change in Control refuses to assume or
substitute for an Award (other than any portion subject to performance-based vesting), the Administrator may cause (i) any or all of such Award (or portion thereof) to terminate in exchange for cash, rights or other property pursuant to
Section 13.2(b)(i) or (ii) any or all of such Award (or portion thereof) to become fully exercisable immediately prior to the consummation of such transaction and all forfeiture restrictions on any or all of such Award to lapse. If any
such Award is exercisable in lieu of assumption or substitution in the event of a Change in Control, the Administrator shall notify the Holder that such Award shall be fully exercisable for a period of fifteen (15) days from the date of such
notice, contingent upon the occurrence of the Change in Control, and such Award shall terminate upon the expiration of such period. 
 (f)
For the purposes of this Section 13.2, an Award shall be considered assumed if, following the Change in Control, the Award confers the right to purchase or receive, for each Share subject to the Award immediately prior to the Change in Control,
the consideration (whether stock, cash, or other securities or property) received in the Change in Control by holders of Common Stock for each Share held on the effective date of the 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 Change in Control was not solely common stock of the successor
corporation or its parent, the Administrator may, with the consent of the successor corporation, provide for the consideration to be received upon the exercise of the Award, for each Share subject to an Award, to be solely common stock of the
successor corporation or its parent equal in fair market value to the per-share consideration received by holders of Common Stock in the Change in Control. 

(g) The Administrator, in its sole discretion, may include such further provisions and limitations in any Award, agreement or certificate, as
it may deem equitable and in the best interests of the Company that are not inconsistent with the provisions of the Plan. 
 (h) Unless
otherwise determined by the Administrator, no adjustment or action described in this Section 13.2 or in any other provision of the Plan shall be authorized to the extent it would (i) with respect to Awards which are granted to Covered
Employees and are intended to qualify as Performance-Based Compensation, cause such Awards to fail to so qualify as Performance-Based Compensation, (ii) cause the Plan to violate Section 422(b)(1) of the Code, (iii) result in
short-swing profits liability under Section 16 of the Exchange Act or violate the exemptive conditions of Rule 16b-3 of the Exchange Act, or (iv) cause an Award to fail to be exempt from or comply with Section 409A. 

(i) The existence of the Plan, any Program, any Award Agreement and/or the Awards granted hereunder shall not affect or restrict in any way the
right or power of the Company or the stockholders of the Company to make or authorize any adjustment, recapitalization, reorganization or other change in the Company’s capital structure or its business, any merger or 

  
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consolidation of the Company, any issue of stock or of options, warrants or rights to purchase stock or of bonds, debentures, preferred or prior preference stocks whose rights are superior to or
affect the Common Stock or the rights thereof or which are convertible into or exchangeable for Common Stock, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other
corporate act or proceeding, whether of a similar character or otherwise. 
 (j) In the event of any pending stock dividend, stock split,
combination or exchange of shares, merger, consolidation or other distribution (other than normal cash dividends) of Company assets to stockholders, or any other change affecting the Shares or the share price of the Common Stock including any Equity
Restructuring, for reasons of administrative convenience, the Administrator, in its sole discretion, may refuse to permit the exercise of any Award during a period of up to thirty (30) days prior to the consummation of any such transaction.

 13.3 Approval of Plan by Stockholders. The Plan shall be submitted for the approval of the Company’s stockholders within
twelve (12) months after the date of the Board’s initial adoption of the Plan. 
 13.4 No Stockholders Rights. Except as
otherwise provided herein or in an applicable Program or Award Agreement, a Holder shall have none of the rights of a stockholder with respect to Shares covered by any Award until the Holder becomes the record owner of such Shares. 

13.5 Paperless Administration. In the event that the Company establishes, for itself or using the services of a third party, an
automated system for the documentation, granting or exercise of Awards, such as a system using an internet website or interactive voice response, then the paperless documentation, granting or exercise of Awards by a Holder may be permitted through
the use of such an automated system. 
 13.6 Effect of Plan upon Other Compensation Plans. The adoption of the Plan shall not affect
any other compensation or incentive plans in effect for the Company or any Subsidiary. Nothing in the Plan shall be construed to limit the right of the Company or any Subsidiary: (a) to establish any other forms of incentives or compensation
for Employees, Directors or Consultants of the Company or any Subsidiary, or (b) to grant or assume options or other rights or awards otherwise than under the Plan in connection with any proper corporate purpose including without limitation,
the grant or assumption of options in connection with the acquisition by purchase, lease, merger, consolidation or otherwise, of the business, stock or assets of any corporation, partnership, limited liability company, firm or association. 

13.7 Compliance with Laws. The Plan, the granting and vesting of Awards under the Plan and the issuance and delivery of Shares and the
payment of money under the Plan or under Awards granted or awarded hereunder are subject to compliance with all Applicable Law (including but not limited to state, federal and foreign securities law and margin requirements), and to such approvals by
any listing, regulatory or governmental authority as may, in the opinion of counsel for the Company, be necessary or advisable in connection therewith. Any securities delivered under the Plan shall be subject to such restrictions, and the person
acquiring such securities shall, if requested by the Company, provide such assurances and representations to the Company as the Company may deem necessary or desirable to assure compliance with all 

  
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Applicable Law. The Administrator, in its sole discretion, may take whatever actions it deems necessary or appropriate to effect compliance with Applicable Law, including, without limitation,
placing legends on share certificates and issuing stop-transfer notices to agents and registrars. Notwithstanding anything to the contrary herein, the Administrator may not take any actions hereunder, and no Awards shall be granted, that would
violate Applicable Law. To the extent permitted by Applicable Law, the Plan and Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform to Applicable Law. 

13.8 Titles and Headings, References to Sections of the Code or Exchange Act. The titles and headings of the Sections in the Plan are
for convenience of reference only and, in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control. References to sections of the Code or the Exchange Act shall include any amendment or successor thereto.

 13.9 Governing Law. The Plan and any Programs and Award Agreements hereunder shall be administered, interpreted and enforced under
the internal laws of the State of Delaware without regard to conflicts of laws thereof or of any other jurisdiction. 
 13.10
Section 409A. To the extent that the Administrator determines that any Award granted under the Plan is subject to Section 409A, the Plan, the Program pursuant to which such Award is granted and the Award Agreement evidencing such
Award shall incorporate the terms and conditions required by Section 409A. In that regard, to the extent any Award under the Plan or any other compensatory plan or arrangement of the Company or any of its Subsidiaries is subject to
Section 409A, and such Award or other amount is payable on account of a Participant’s Termination of Service (or any similarly defined term), then (a) such Award or amount shall only be paid to the extent such Termination of Service
qualifies as a “separation from service” as defined in Section 409A, and (b) if such Award or amount is payable to a “specified employee” as defined in Section 409A then to the extent required in order to avoid a
prohibited distribution under Section 409A, such Award or other compensatory payment shall not be payable prior to the earlier of (i) the expiration of the six-month period measured from the date of the Participant’s Termination of
Service, or (ii) the date of the Participant’s death. To the extent applicable, the Plan, the Program and any Award Agreements shall be interpreted in accordance with Section 409A. Notwithstanding any provision of the Plan to the
contrary, in the event that following the Effective Date the Administrator determines that any Award may be subject to Section 409A, the Administrator may (but is not obligated to), without a Holder’s consent, adopt such amendments to the
Plan and the applicable Program and Award Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Administrator determines are necessary or
appropriate to (A) exempt the Award from Section 409A and/or preserve the intended tax treatment of the benefits provided with respect to the Award, or (B) comply with the requirements of Section 409A and thereby avoid the
application of any penalty taxes under Section 409A. The Company makes no representations or warranties as to the tax treatment of any Award under Section 409A or otherwise. The Company shall have no obligation under this
Section 13.10 or otherwise to take any action (whether or not described herein) to avoid the imposition of taxes, penalties or interest under Section 409A with respect to any Award and shall have no liability to any Holder or any other
person if any Award, compensation or other benefits under the Plan are determined to constitute non-compliant, “nonqualified deferred compensation” subject to the imposition of taxes, penalties and/or interest under Section 409A. 

  
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 13.11 Unfunded Status of Awards. The Plan is intended to be an “unfunded” plan
for incentive compensation. With respect to any payments not yet made to a Holder pursuant to an Award, nothing contained in the Plan or any Program or Award Agreement shall give the Holder any rights that are greater than those of a general
creditor of the Company or any Subsidiary. 
 13.12 Indemnification. To the extent permitted under Applicable Law and the
Organizational Documents, each member of the Administrator shall be indemnified and held harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by such member in connection with or
resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action or failure to act pursuant to the Plan and against and from any and all amounts paid by him or her
in satisfaction of judgment in such action, suit, or proceeding against him or her; provided he or she gives the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on
his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled pursuant to the Organizational Documents, as a matter of law, or otherwise, or any
power that the Company may have to indemnify them or hold them harmless. 
 13.13 Relationship to other Benefits. No payment pursuant
to the Plan shall be taken into account in determining any benefits under any pension, retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the Company or any Subsidiary except to the extent otherwise expressly
provided in writing in such other plan or an agreement thereunder. 
 13.14 Expenses. The expenses of administering the Plan shall be
borne by the Company and its Subsidiaries. 
 *  *  *  *  * 

I hereby certify that the foregoing Plan was duly adopted by the Board of Directors of Novan, Inc. on
                 , 2016. 

*  *  *  *  * 

I hereby certify that the foregoing Plan was approved by the stockholders of Novan, Inc. on
                 , 2016. 
 Executed on this
            day of             , 2016. 

 

	
	   

	Corporate Secretary

  
 33EX-10.4

 Exhibit 10.4 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT 

This Amended and Restated Employment Agreement (the “Agreement”) is entered into as of April 13, 2016 (the “Effective
Date”) by and between Novan, Inc., a Delaware corporation with its principal place of business in Durham County, North Carolina (the “Company”), and Nathan Stasko, a citizen and resident of Orange County, North Carolina
(“Employee”). The Company and Employee are sometimes herein referred to each as a “Party” and together as the “Parties.” 

WITNESSETH: 
 WHEREAS,
Employee is currently employed by the Company pursuant to that certain Employment Agreement, dated December 14, 2015 by and between Employee and the Company, (the “Prior Agreement”); 

WHEREAS, the Company wishes to continue to employ Employee, and Employee desires to accept such continued employment with the Company, on the
terms described herein; and 
 WHEREAS, effective as of the Effective Date, the Parties desire to amend and restate the Prior Agreement by
entering into this Agreement which shall supersede the Prior Agreement in its entirety. 
 NOW, THEREFORE, in consideration of the
foregoing, the mutual promises herein contained, and other good and valuable consideration, including the employment of Employee by the Company and the compensation received by Employee from the Company from time to time, the receipt and sufficiency
of which are hereby acknowledged, the Parties hereto, intending to be legally bound, hereby agree as follows. 
 1. EMPLOYMENT. The
Company hereby agrees to continue to employ Employee, and Employee hereby accepts such continued employment. Employee shall serve as the Company’s President and Chief Executive Officer upon the terms and conditions hereinafter set forth. The
initial term of employment under this Agreement (the Initial Term”) shall be for the period beginning on the Effective Date and ending on the third (3rd) anniversary thereof, unless
earlier terminated as provided in Section 4. This Agreement shall automatically be extended for successive one-year periods (each, an “Extension Term” and, collectively with the Initial Term, the “Term”) unless
either party gives notice of non-extension to the other no later than 90 days prior to the expiration of the then-applicable Term. 
 2.
DUTIES; EXCLUSIVE SERVICE. During the Term, Employee shall faithfully discharge his responsibilities and perform all duties prescribed to him by the Board of Directors of the Company (the “Board”), or other appropriate
parties within the Company, as well as any duties as are set forth in the Bylaws of the Company related to Employee’s position. In addition, Employee expressly agrees that his services include but are not limited to attendance at scheduled
meetings of the Board, if and as requested by the Board, and all other normal duties associated with the responsibilities of a President and Chief Executive Officer. Employee agrees 

 
to comply with all Company policies, standards and regulations now existing or hereafter promulgated. Employee further agrees to devote all of his working time and attention to the performance of
his duties and responsibilities on behalf of the Company and in furtherance of its best interests. Notwithstanding the foregoing, it shall not be a violation of this Agreement for Employee to, with the consent of the Board, serve on corporate, civic
or charitable boards, provided that no such company engages in any business that competes with or represents a conflict with the business of the Company, and provided that such activities do not interfere with the performance of Employee’s
duties and responsibilities hereunder, in each case as determined in the sole discretion of the Board. 
 3. COMPENSATION.
Employee’s compensation shall be paid as follows: 
 a. Base Salary. During the Term, Employee shall receive as compensation a
base salary at an annual rate of no less than three hundred sixty thousand Dollars ($360,000.00), as it may be adjusted from time to time (the “Base Salary”), less any federal, state and local payroll taxes and other withholdings
legally required or properly requested by Employee. The Base Salary shall be payable in accordance with the Company’s regular payroll practices and procedures. Employee’s Base Salary shall be subject to annual review by the Board
(excluding Employee, if then a Board member). 
 b. Bonus. For calendar year 2016 and each subsequent calendar year that ends during
the Term, Employee will be eligible to receive an annual performance-based cash bonus (the “Annual Bonus”). The payment and amount of any Annual Bonus will be determined by the Board or the Compensation Committee thereof (excluding
Employee, if then a Board member), in its sole and absolute discretion, pursuant to the Company’s Executive Annual Incentive Plan or another bonus plan established by the Company, and conditioned upon the achievement of mutually agreed upon
objectives for Employee and for the Company established at the beginning of each calendar year, with a target Annual Bonus equal to sixty percent (60%) of the Base Salary for achievement of 100% of the performance objectives. Any dispute regarding
whether Employee has met the objectives shall be determined by the Board or the Compensation Committee thereof (excluding Employee, if then a Board member) in the exercise of its sole discretion. 

c. Equity. For each calendar year during the Term, Employee shall be eligible to receive an annual award of stock options or restricted
stock as a merit incentive based on the growth in shareholder value and/or other goals established at the sole discretion of the Board and granted pursuant to and subject to the terms and conditions of the Company’s incentive award plan and a
written award agreement between the Company and Employee in a form approved by the Board. The amount, type of award, exercise price if applicable and vesting period shall be at the sole discretion of the Board (excluding Employee, if then a Board
member). The Parties acknowledge and agree that the annual equity award for the 2016 calendar year was the February 29, 2016 grant to Employee of an option for the purchase of 144,000 shares of the Company’s outstanding voting common stock.

  
 2 

 d. Paid Leave. During the Term, Employee shall be entitled to twenty-four (24) days
paid leave time each calendar year, which paid leave time will accrue in accordance with the Company’s then-existing policies, or monthly in the absence of any applicable policies. 

e. Benefits. During the Term, Employee shall be entitled to participate in employee benefit plans, programs and arrangements of the
Company as are provided generally from time to time to all other similarly situated employees of the Company. All such benefits are subject to the provisions of their respective plan documents in accordance with their terms and are subject to
amendment or termination by the Company without Employee’s consent. 
 f. Business Expenses. During the Term, the Company will
reimburse all reasonable expenses incurred by Employee in the performance of his duties to the Company, provided Employee complies with the Company’s policies and procedures for reimbursement or advance of business expenses established by the
Company. Employee further agrees to seek the Company’s prior approval for any expenses in excess of two hundred fifty Dollars ($250.00). 

g. Term Life Insurance. During the Term, the Company will provide employee with a term life insurance policy providing a death
benefit equal to the death benefit of the key man life insurance policy for which the Company is the beneficiary, with a beneficiary to be designated by Employee. 

4. EMPLOYMENT AT WILL; TERMINATION. Subject to the provisions of Section 6 below, Employee’s employment with the Company is
at-will, and either Party can terminate the employment relationship and/or this Agreement at any time, for any or no cause or reason, and with or without prior notice. 

5. EFFECT OF TERMINATION. Upon termination of Employee’s employment hereunder by either Party regardless of the cause or reason,
the Company shall pay Employee his accrued, unpaid wages through the Separation Date (as defined below). Such final payment, less any withholdings required by law or properly requested by Employee, shall be made on the next regular payday of the
Company following the termination, in accordance with the Company’s normal payroll procedures. Except as otherwise provided in Section 6 of this Agreement, no other payments, benefits or other remuneration shall be due or payable to Employee.

 6. SEVERANCE PROVISIONS. 

a. Definitions. For the purposes of this Section 6, the following terms shall be defined as set out below: 

i. “Base Salary” shall mean Employee’s then current annual Base Salary. 

ii. “Cause” shall be determined in good faith by the Board (excluding Employee, if then a Board member) and shall mean: 

(a) Employee’s conviction of, or plea of no contest to, any crime (whether or not involving the Company) that constitutes a felony in
the jurisdiction in which Employee is charged, or that involves moral turpitude; 

  
 3 

 (b) Any act of theft, fraud or embezzlement, or any other willful misconduct or materially
dishonest behavior by Employee; 
 (c) Employee’s failure or refusal to perform his reasonably-assigned duties, provided that such
failure or refusal is not corrected as promptly as practicable, and in any event within ten (10) calendar days after Employee shall have received written notice from the Company stating the nature of such failure or refusal; 

(d) Employee’s willful or material violation of any of his obligations contained in any agreement between Employee and the Company,
including but not limited to Confidentiality and Assignment of Inventions Agreement and Non-Competition Agreement executed by Employee on or about October 9, 2009 (the “Restrictive Covenants Agreements”) or material violation of any
policies in the Company’s Employee Handbook; and/or 
 (e) Conduct by Employee that constitutes willful gross neglect or willful gross
misconduct in carrying out his duties under this Agreement that results or that may result, as determined by the Company, in material harm to the Company, including harm to its reputation. 

iii. “Disability” shall mean Employee’s inability due to a physical or mental impairment to perform the essential
functions of his job, with or without reasonable accommodation, for a period of at least ninety (90) consecutive or non-consecutive days in any twelve (12) month period. 

iv. “Effective Release” is defined as a general release of claims in favor of the Company in a form reasonably acceptable to
the Company’s counsel that is executed after the Separation Date and within any consideration period required by applicable law and that is not revoked by Employee within any legally-prescribed revocation period; provided, however, a release
shall not be considered an Effective Release unless, in addition to the foregoing conditions, the release is executed and not revoked, and the legally-prescribed revocation period ends by the sixtieth
(60th) day following the Separation Date. Failure to provide and have in effect an Effective Release within the 60-day period following the Separation Date shall result in forfeiture of any
benefits conditioned upon the existence of an Effective Release. 
 v. “Good Reason” shall mean a material negative change
to Employee in the service relationship with the Company as a result of one or more of the following conditions arising without the consent of Employee: 

(a) A material diminution in Employee’s Base Salary (other than in connection with an across-the-board reduction in the base salaries of
the management-level employees of the Company); 

  
 4 

 (b) A material diminution in Employee’s authority, duties or responsibilities; 

(c) A material change in the geographic location at which Employee must perform services for the Company; or 

(e) Any other action or inaction that constitutes a material breach of the terms of this Agreement by the Company. 

Notwithstanding the forgoing, “Good Reason” shall not include an event or condition unless (A) Employee notifies the Company within
ninety (90) days of the initial existence of one of the adverse events described above, (B) Employee provides the Company with at least thirty (30) days’ written notice of his intent to resign for Good Reason, and (C) the Company fails to
correct the adverse event within thirty (30) days of such notice. 
 vi. “Separation from Service” shall mean Employee has
a “separation from service” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations and other interpretive guidance thereunder
(“Section 409A”) from the Company and will not perform any additional services after a certain date for the Company (or a related entity) or that the level of bona fide services (whether performed as an employee or as a
contractor) will permanently decrease to no more than 20% of the average level of bona fide services performed by Employee (whether performed as an employee or as a contractor) over the immediately preceding 36-month period (or, if less, the period
Employee has rendered service to the Company). 
 vii. “Separation Date” shall mean the date that Employee has a
Separation from Service from the Company. 
 b. Compensation upon Separation without “Cause” or for “Good
Reason.” Upon Separation from Service by the Company without Cause or by Employee for Good Reason, conditioned upon the existence of an Effective Release and Employee’s continued compliance with the Restrictive Covenants
Agreements and the terms thereunder, and subject to Section 9, Employee shall be entitled to, in lieu of any other separation payment or severance benefit: 

i. Payment of an amount equal to twelve (12) months of his Base Salary, minus applicable withholdings required by law or authorized by
Employee, to be paid in installments pursuant to the Company’s standard payroll practices and procedures, during the period beginning on the Company’s next regular pay day occurring sixty (60) days following the Separation Date and ending
on the twelve (12) month anniversary of the Separation Date; and 
 ii. Conditioned on Employee’s proper and timely election to
continue his health insurance benefits under COBRA after the Separation Date, reimbursement of Employee’s applicable COBRA premiums for the lesser of twelve (12) months following the Separation Date or until Employee becomes eligible for
insurance benefits from another employer. 

  
 5 

 c. Other Separation from Service. Upon Separation from Service by Employee other than for
Good Reason or due to Employee’s death or Disability, or by the Company for Cause, Employee shall not be entitled to any additional compensation under this Agreement beyond that earned and accrued as of the Separation Date. 

7. CHANGE IN CONTROL. Upon Separation from Service by the Company without Cause or by Employee for Good Reason within six (6) months
after the occurrence of a Change in Control (as defined below) then, upon such Separation from Service, one hundred percent (100%) of Employee’s unvested stock options shall vest and become immediately exercisable and one hundred percent (100%)
of any restricted stock granted to Employee will be released from the Company’s repurchase rights (the “Change in Control Vesting”). A “Change In Control” shall mean (a) a change in the ownership of the Company
within the meaning of Treasury Regulation section 1.409A-3(i)(5)(v); (b) a change in effective control of the Company within the meaning of Treasury Regulation section 1.409A-3(i)(5)(vi); or (c) a change in the ownership of a substantial portion of
the assets of the corporation within the meaning of Treasury Regulation section 1.409A-3(i)(5)(vii). Notwithstanding the foregoing, if Employee is entitled to receive the Change in Control Vesting but has materially violated any provision of
this Agreement, the Restrictive Covenants Agreements or any other agreement entered into by Employee and the Company, Employee shall not be entitled to the Change in Control Vesting. 

8. SECTION 409A. 
 a. The
parties hereby acknowledge and agree that all benefits or payments provided by the Company to Employee pursuant to this Agreement are intended either to be exempt from Section 409A of the Code, or to be in compliance with Section 409A, and the
Agreement shall be interpreted to the greatest extent possible to be so exempt or in compliance and to incorporate the terms and conditions required by Section 409A. If there is an ambiguity in the language of the Agreement, or if Section 409A
guidance indicates that a change to the Agreement is required or desirable to achieve exemption or compliance with Section 409A, notwithstanding any provision of this Agreement to the contrary, the Company reserves the right (without any obligation
to do so or to indemnify Employee for failure to do so) to (i) adopt such amendments to this Agreement and or adopt such other policies and procedures, including amendments, policies and procedures with retroactive effect, that the Company
determines to be necessary or appropriate to preserve the intended tax treatment of the benefits provided by this Agreement, to preserve the economic benefits of this Agreement and to avoid less favorable accounting or tax consequences for the
Company and/or (ii) take such other actions as the Company determines to be necessary or appropriate to exempt the amounts payable hereunder from Section 409A or to comply with the requirements of Section 409A and thereby avoid the application of
penalty taxes thereunder. No provision of this Agreement shall be interpreted or construed to transfer any liability for failure to comply with the requirements of Section 409A from the Employee or any other individual to the Company or any
of its affiliates, employees or agents. 

  
 6 

 b. If any severance or other payments that are required by the Agreement are to be paid in a
series of installment payments, each individual payment in the series shall be considered a separate payment for purposes of Section 409A. To the extent that any reimbursement of expenses or in-kind benefits constitutes “deferred
compensation” under Section 409A, such reimbursement or benefit shall be provided no later than December 31 of the year following the year in which the expense was incurred. The amount of expenses reimbursed in one year shall not affect
the amount eligible for reimbursement in any subsequent year. The amount of any in-kind benefits provided in one year shall not affect the amount of in-kind benefits provided in any other year. 

c. If any severance compensation or other benefit provided to Employee pursuant to this Agreement that constitutes “nonqualified deferred
compensation” within the meaning of Section 409A is considered to be paid on account of “separation from service” within the meaning of Section 409A, and Employee is a “specified employee” within the meaning of Section 409A,
no payments of any of such severance or other benefit shall made for six (6) months plus one (1) day after the Separation Date (the “New Payment Date”). Amounts payable under this Agreement shall be deemed not to be
“nonqualified deferral of compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation §§ 1.409A-1(b)(4) (“short-term deferrals”) and (b)(9) (“separation pay plans,”
including the exception under subparagraph (iii)) and other applicable provisions of Section 409A. The aggregate of any such payments that would have otherwise been paid during the period between the Separation Date and the New Payment Date shall be
paid to Employee in a lump sum on the New Payment Date. 
 9. EXCESS PARACHUTE PAYMENTS. 

a. If any payments or benefits received or to be received by Employee pursuant to this Agreement, including those made in connection with or
contingent on a change in ownership or control, (collectively, the “Company Payments”) would be deemed to be an “excess parachute payment” within the meaning of Section 280G of the Code (“Excess Parachute
Payment”), and if the Company has no publicly-traded stock, the Company, with the consent of Employee, will use commercially reasonable efforts to obtain “shareholder approval” within the meaning of Section 280G(b)(5) of the Code
of such payments or benefits in order to exempt such payments or benefits from being considered an Excess Parachute Payment. Employee’s consent to shareholder approval shall include a waiver by Employee of any such payments or benefits that are
not approved by the shareholders. If Employee does not consent to subjecting such payments or benefits to shareholder approval, then, at Company’s election, such payments under this Agreement shall either be paid in full or reduced to the
extent necessary to avoid being considered an Excess Parachute Payment, based upon Company’s determination, in its sole discretion, as to which alternative results in the better tax consequences for Employee. 

b. If the Company has publicly traded stock, then Employee will be entitled to receive either (i) the full amount of the Company Payments, or
(ii) a portion of the Company Payments having a value equal to $10 less than three (3) times Employee’s “base amount” (as such term is defined in Section 280G(b)(3)(A) of the Code), whichever of clauses (i) and (ii), after taking into
account applicable federal, state, and local income taxes and the excise tax imposed by Section 4999 of the Code, results in the receipt by Employee on an after-tax basis, of 

  
 7 

 
the greatest portion of the Company Payments. Any determination required under this Section 9 shall be made in writing by the independent public accountant of the Company (the
“Accountants”), whose determination shall be conclusive and binding for all purposes upon the Company and Employee. For purposes of making any calculation required by this Section 9, the Accountants may make reasonable assumptions
and approximations concerning applicable taxes and may rely on reasonable, good-faith interpretations concerning the application of Sections 280G and 4999 of the Code. If there is a reduction of the Company Payments pursuant to this Section 9, such
reduction shall occur in the following order: (A) any cash severance payable by reference to Employee’s Base Salary or Annual Bonus, (B) any other cash amount payable to Employee, (C) any employee benefit valued as a “parachute
payment,” and (D) acceleration of vesting of any outstanding equity award. 
 10. NOTICES. Any notice required or permitted
hereunder shall be made in writing (a) either by actual delivery of the notice into the hands of the Party thereto entitled, by messenger, by fax or by over-night delivery service or (b) by the mailing of the notice in the United States mail,
certified or registered mail, return receipt requested, all postage pre-paid and addressed to the Party to whom the notice is to be given at the Party’s respective address set forth below, or such other address as the Parties may from time to
time designate by written notice as herein provided. 
  

			
	If to Employee:	  	104 Falkner Drive
		  	Chapel Hill, North Carolina 27517
		
	If to the Company:	  	Novan, Inc.
		  	4222 Emperor Boulevard, Suite 200
		  	Durham, North Carolina 27703
		  	Fax: (919) 237-9212
		  	Attn: Chairman of the Board

 The notice shall be deemed to be received, if sent per subsection (a), on the date of its actual receipt by the Party entitled
thereto and, if sent per subsection (b), on the third day after the date of its mailing. 
 11. RETURN OF COMPANY PROPERTY. Upon
Employee’s Separation from Service from the Company for any reason, Employee shall return to Company all personal property belonging to Company (“Company Property”) that is in Employee’s possession or control as of the
date of such Separation from Service, including, without limitation, all records, papers, drawings, notebooks, specifications, marketing materials, software, reports, proposals, equipment, or any other device, document or possession, however
obtained, whether or not such Company Property contains confidential information belonging to the Company. Such Company Property shall be returned in the same condition as when provided to Employee, reasonable wear and tear excepted. 

  
 8 

 12. EMPLOYEE REPRESENTATIONS. 

a. Employee represents that his performance of all of the terms of this Agreement does not and will not breach any arrangement to keep in
confidence information acquired by Employee in confidence or in trust prior to Employee’s employment by the Company. Employee represents that he has not entered into, and agrees not to enter into, any agreement either oral or written in
conflict herewith. 
 b. Employee understands as part of the consideration for this Agreement and for Employee’s employment or
continued employment by the Company, that Employee has not brought and will not bring with Employee to the Company, or use in the performance of Employee’s duties and responsibilities for the Company or otherwise on its behalf, any materials or
documents of a former employer or other owner which are generally not available to the public, unless Employee has obtained written authorization from the former employer or other owner for their possession and use and has provided the Company with
a copy thereof. 
 c. Employee understands that during his employment for the Company he is not to breach any obligation of confidentiality
that Employee has to a former employer or any other person or entity and agrees to comply with such understanding. 
 13.
INDEMNIFICATION. Employee agrees to indemnify and hold harmless the Company, its directors, officers, agents and employees against any liabilities and expenses, including amounts paid in settlement, incurred by any of them in connection with
any claim by any of Employee’s prior employers that the termination of Employee’s employment with such employer, Employee’s employment by the Company, or use of any skills and knowledge by the Company is a violation of contract or law
or otherwise violates the rights thereof. 
 14. SEVERABILITY. Employee hereby agrees that each provision herein shall be
treated as a separate and independent clause, and the unenforceability of any one clause shall in no way impair the enforceability of any of the other clauses herein. 

15. NOTICES. Any notice required to be given hereunder shall be sufficient if in writing and sent by certified or registered mail,
return receipt requested, first-class postage prepaid, in the case of Employee, to his address last shown on the Company’s records, and in the case of the Company, to its principal office in the State of North Carolina. 

16. WAIVER. Any waiver by the Company of a breach of any provision of this Agreement shall not operate or be construed as a waiver
of any subsequent breach of such provision or any other provision hereof. 
 17. AFFILIATES; ASSIGNMENT; BINDING EFFECT. The term
“Company” shall also include any of the Company’s subsidiaries, subdivisions or affiliates. The Company shall have the right to assign this Agreement to its successors and assigns, and all covenants and agreements hereunder shall
inure to the benefit of and be enforceable by said successors or assigns. Employee may not assign any of his rights or delegate any of his duties under this Agreement. This Agreement shall be binding upon and shall inure to the benefit of each of
the Parties hereto, and to their respective heirs, representatives, successors and permitted assigns. 

  
 9 

 18. ENTIRE AGREEMENT. The terms of this Agreement (together with any other agreements
and instruments contemplated hereby or referred to herein) are intended by the Parties hereto to be the final expression of their agreement with respect to the employment of Employee by the Company and may not be contradicted by evidence of any
prior or contemporaneous agreement (including, without limitation, the Prior Agreement, any term sheet or offer letter). The Parties hereto further intend that this Agreement shall constitute the complete and exclusive statement of its terms
and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative or other legal proceeding to vary the terms of this Agreement. No modification of or amendment to this Agreement, nor any waiver of any rights under this
Agreement, will be effective unless in writing and signed by each of the Parties hereto. 
 19. GOVERNING LAW; VENUE. This
Agreement shall be governed by and construed in accordance with the laws of the State of North Carolina, without regard to that body of law known as choice of law. Any litigation under this Agreement shall be brought by either Party exclusively
in Durham County, North Carolina. As such, the Parties irrevocably consent to the jurisdiction of the courts in Durham County, North Carolina (whether federal or state) for all disputes related to this Agreement. 

20. COUNTERPARTS. This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which
taken together constitute one agreement. Counterparts may be transmitted and/or signed by facsimile or electronic mail. The effectiveness of any such documents and signatures shall have the same force and effect as manually signed
originals and shall be binding on the Parties to the same extent as a manually signed original thereof. 
 [Signature Page Follows] 

  
 10 

 IN WITNESS WHEREOF, the Parties have executed this Amended and Restated Employment Agreement
effective as of the day and year first above written. 
  

			
	NOVAN, INC.
		
	By:	 	 /s/ Robert A. Ingram

		
	Name:	 	Robert A. Ingram
		
	Title:	 	Chairman of the Board
	
	EMPLOYEE
	
	 /s/ Nathan Stasko

	Nathan Stasko

  
 11

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