Document:

Form of NewStar Financial, Inc. 2006 Incentive Plan.

 Exhibit 10.16.1 
 2006 INCENTIVE PLAN 
 OF 
 NEWSTAR FINANCIAL, INC. 

					
	ARTICLE I	 	DEFINITIONS	  	5
	 1.1
	 	General	  	5
	 1.2
	 	Affiliate	  	5
	 1.3
	 	Annual Incentive Award	  	5
	 1.4
	 	Award	  	5
	 1.5
	 	Award Agreement	  	5
	 1.6
	 	Benefit Arrangement	  	6
	 1.7
	 	Board	  	6
	 1.8
	 	Cause	  	6
	 1.9
	 	Code	  	6
	 1.10
	 	Committee	  	6
	 1.11
	 	Common Stock	  	6
	 1.12
	 	Company	  	6
	 1.13
	 	Company Entity	  	6
	 1.14
	 	Continuing Directors	  	6
	 1.15
	 	Covered Employee	  	7
	 1.16
	 	Deferred Stock	  	7
	 1.17
	 	Director	  	7
	 1.18
	 	Disability	  	7
	 1.19
	 	Dividend Equivalent Right	  	7
	 1.20
	 	Eligible Grantee	  	7
	 1.21
	 	Employee	  	7
	 1.22
	 	Exchange Act	  	7
	 1.23
	 	Fair Market Value	  	7
	 1.24
	 	Grantee	  	7
	 1.25
	 	Incentive Stock Option	  	7
	 1.26
	 	Independent Director	  	7
	 1.27
	 	Non-Qualified Stock Option	  	7
	 1.28
	 	Option	  	8
	 1.29
	 	Optionee	  	8
	 1.30
	 	Performance Award.	  	8
	 1.31
	 	Performance Goals	  	8
	 1.32
	 	Performance Measures	  	8
	 1.33
	 	Plan	  	8
	 1.34
	 	Reporting Person	  	8
	 1.35
	 	Restricted Stock	  	8
	 1.36
	 	Restricted Stock Unit	  	8
	 1.35
	 	Retirement	  	9
	 1.36
	 	Rule 16b-3	  	9
	 1.37
	 	Stock Payment	  	9
	 1.38
	 	Subsidiary	  	9
	 1.39
	 	Termination of Directorship	  	9
	 1. 40
	 	Termination of Employment	  	9
	ARTICLE II	 	SHARES SUBJECT TO PLAN	  	10
	 2.1
	 	Shares Subject to Plan	  	10

  

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	 2.2
	 	Share Usage	  	10
	ARTICLE III	 	GRANTING OF OPTIONS	  	11
	 3.1
	 	Eligibility	  	11
	 3.2
	 	Granting of Options	  	11
	 3.3
	 	Special Rules Applicable to Incentive Stock Options	  	11
	 3.4
	 	Substitute Options	  	12
	ARTICLE IV	 	TERMS OF OPTIONS	  	12
	 4.1
	 	Option Agreement	  	12
	 4.2
	 	Option Price	  	12
	 4.3
	 	Option Term	  	13
	 4.4
	 	Option Vesting and Exercisability	  	13
	 4.5
	 	Expiration of Options	  	13
	ARTICLE V	 	EXERCISE OF OPTIONS	  	13
	 5.1
	 	Partial Exercise	  	13
	 5.2
	 	Manner of Exercise	  	13
	 5.3
	 	Conditions to Issuance of Stock Certificate	  	14
	 5.4
	 	Rights as Stockholders	  	15
	 5.5
	 	Ownership and Transfer Restrictions	  	15
	ARTICLE VI	 	AWARD OF RESTRICTED STOCK AND STOCK UNITS	  	15
	 6.1
	 	Award of Restricted Stock	  	15
	 6.2
	 	Restricted Stock Agreement	  	15
	 6.3
	 	Rights as Stockholders	  	16
	 6.4
	 	Restriction	  	16
	 6.5
	 	Escrow	  	16
	 6.6
	 	Legend	  	16
	ARTICLE VII	 	STOCK APPRECIATION RIGHTS	  	16
	ARTICLE VIII	 	PERFORMANCE AND ANNUAL INCENTIVE AWARDS	  	17
	ARTICLE IX	 	PARACHUTE LIMITATIONS	  	19
	ARTICLE X	 	UNRESTRICTED AND DEFERRED STOCK, DIVIDEND EQUIVALENT RIGHTS, OR OTHER AWARDS,	  	19
	 10.1
	 	Dividend Equivalents	  	19
	 10.2
	 	Unrestricted Stock	  	20
	 10.3
	 	Deferred Stock	  	20
	 10.4
	 	Other Stock Based Awards	  	20
	 10.5
	 	Form of Agreement	  	20
	ARTICLE XI	 	ADMINISTRATION	  	21
	 11.1
	 	Compensation Committee	  	21
	 11.2
	 	Duties and Powers of Committee	  	21
	 11.3
	 	Majority Rule	  	22
	 11.4
	 	Expense Reimbursement; Professional Assistance; Good Faith Actions	  	22
	ARTICLE XII	 	MISCELLANEOUS PROVISIONS	  	22
	 12.1
	 	Not Transferable	  	22
	 12.2
	 	Amendment Suspension or Termination of this Plan	  	22
	 12.3
	 	Approval of Plan by Stockholders	  	23
	 12.4
	 	Limitations Applicable to Section 16 Persons and Performance-Based Compensation	  	23

  

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	 12.5
	 	Effect of Plan Upon Options and Compensation Plans	  	23
	 12.6
	 	Compliance with Laws	  	24
	 12.7
	 	Titles	  	24
	 12.8
	 	Governing Law	  	24
	 12.9
	 	Change in Control	  	24
	 12.10
	 	Withholding. Requirements and Arrangements	  	25
	 12.11
	 	Adjustments	  	26
	 12.12
	 	Other Transfer Restrictions	  	28
	 12.13
	 	Certain Indebtedness to the Company	  	28
	 12.14
	 	Foreign Nationals	  	28
	 12.15
	 	No Right to Employment	  	29
	 12.16
	 	Authorization of Sub Plans	  	29
	 12.17
	 	Severability	  	29
	 12.18
	 	Inability to Obtain Authority	  	29
	 12. 19
	 	Uncertificated Shares	  	29
	 12. 20
	 	Unfunded Plan	  	29
	 12. 21
	 	No Constraint on Corporate Action	  	30
	 12.22
	 	Special Provisions Relating to Section 409A of the Code	  	30

  

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 2006 INCENTIVE PLAN 
 OF 
 NEWSTAR FINANCIAL, INC. 
 The name of this plan is the NewStar Financial, Inc. 2006 Incentive Plan (the “Plan”). The Plan was adopted by the Board of Directors
(“Board”) of NewStar Financial, Inc. (“Company”) on November 16, 2006 and the Plan shall be effective on
                    , 2006. The purpose of the Plan is to enable the Company to attract and retain highly qualified personnel who will
contribute to the Company’s success by their ability, ingenuity and industry experience and to provide incentives to the participating officers, directors, employees, consultants and advisors that are linked directly to shareholder interests
and will therefore inure to the benefit of all shareholders of the Company. To this end, the Plan provides for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, stock payments, dividend equivalents,
deferred stock, performance awards and cash awards. Any of these awards may, but need not, be made as performance incentives to reward attainment of annual or long-term performance goals in accordance with the terms hereof. 
 ARTICLE I 
 DEFINITIONS 
 1.1 General. Wherever the following terms are used in this Plan they shall have the meaning specified below, unless the context clearly indicates
otherwise. 
 1.2 Affiliate. “Affiliate” shall mean any corporation or other entity (including, but not limited to, a
partnership or a limited liability company) that is affiliated with the Company through stock or equity ownership or otherwise, and is designated as an Affiliate for purposes of this Plan by the Committee. 
 1.3 Annual Incentive Award. “Annual Incentive Award” shall mean an Award made subject to attainment of performance goals (as described
in Article VIII) over a performance period of up to and including one year (the fiscal year, unless otherwise specified by the Committee). 
 1.4 Award. “Award” shall mean the grant of an Option, Restricted Stock, Restricted Stock Unit, Performance Award, Dividend Equivalent, Deferred Stock, Stock Payments, Stock Appreciation Rights, or other awards pursuant to
Article X of this Plan. Awards may be granted for services to be rendered or for services already rendered to the Company or any Affiliate. 
 1.5 Award Agreement. “Award Agreement” means either: (i) a written agreement entered into by the Company and a Grantee setting forth the terms and provisions applicable to an Award granted under this Plan, or
(ii) a written statement issued by the Company to a Grantee describing the terms and provisions of such Award, including any amendment or modification thereof. The Committee may provide for the use of electronic, Internet, or other nonpaper
Award Agreements, and the use of electronic, Internet, or other nonpaper means for the acceptance thereof and actions thereunder by a Grantee. 
  

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 1.6 Benefit Arrangement. “Benefit Arrangement” shall have the meaning set forth in
Article IX hereof. 
 1.7 Board. “Board” shall mean the Board of Directors of the Company. 
 1.8 Cause. means “Cause” as defined in the Optionee’s employment agreement with the Company or, if the Optionee does not have an
employment agreement with the Company, (i) the willful and continued failure of the Optionee to perform substantially the Optionee’s duties with the Company or one of its affiliates (other than any such failure resulting from incapacity
due to physical or mental illness), after a written demand for substantial performance is delivered to the Optionee by the Board of Directors, which specifically identifies the manner in which the Board of Directors believes that the Optionee has
not substantially performed the Optionee’s duties, or (ii) willful engaging by the Optionee in illegal conduct or gross misconduct which is materially and demonstrably injurious to the Company or its affiliates, or (iii) conviction of
or made a plea of guilty or nolo contendere to, a felony, or (iv) a material breach of his or her obligations under Section 4 or Section 5 hereof. For purposes of this definition of “Cause”, no
act or failure to act on the part of the Optionee shall be considered “willful” unless it is done, or omitted to be done, by the Optionee in bad faith or without reasonable belief that the Optionee’s actions or omission was in the
best interests of the Company. Any act, or failure to act, based upon express authority given pursuant to a resolution duly adopted by the Board of Directors with respect to such act or omission or upon the instructions of the Chief Executive
Officer of the Company or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Optionee in good faith and in the best interests of the Company. 
 1.9 Code. “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, or any successor thereto. 
 1.10 Committee. “Committee” shall mean the Compensation Committee of the Board, or a subcommittee of the Board, appointed as provided in
Section 11.1. The Committee shall be responsible for administering and interpreting the Plan in accordance with Article XI. Unless otherwise determined by the Board, if the Committee is authorized to grant Awards to a Reporting Person or a
Covered Employee, each member shall be a “non-employee director” or the equivalent within the meaning of applicable Rule 16b-3 under the Exchange Act or an “outside director” within the meaning of section 162(m) of the Code,
respectively. 
 1.11 Common Stock. “Common Stock” shall mean the common stock, $0.01 par value, of the Company. 

1.12 Company. “Company” shall mean NewStar Financial, Inc. a Delaware corporation. 
 1.13 Company Entity. “Company Entity” shall mean the Company or one of its subsidiaries. 
 1.14 Continuing Directors. “Continuing Directors” shall mean as of any date of determination, any member of the Board who (i) was a
member of Board immediately after the date of the Company’s initial public offering, or (ii) was nominated for election or elected to the Board with the approval of, or whose election to the Board was ratified by, at least a majority of
the Continuing Members who were members of the Board at the time of that nomination or election. 
  

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 1.15 Covered Employee. “Covered Employee” shall mean a “covered employee”
within the meaning of section 162(m) of the Code. 
 1.16 Deferred Stock. “Deferred Stock” shall mean Common Stock awarded
under Article VII of this Plan. 
 1.17 Director. “Director” shall mean a member of the Board. 
 1.18 Disability. “Disability” shall be defined pursuant to section 22(e)(3) of the Code. 
 1.19 Dividend Equivalent Right. “Dividend Equivalent Right” shall mean a right to receive the equivalent value (in cash or Common Stock)
of dividends paid on Common Stock, awarded under Article VII of this Plan. 
 1.20 Eligible Grantee. “Eligible Grantee”
shall mean any Officer, Employee, consultant, advisor or Independent Director of the Company. 
 1.21 Employee. “Employee”
shall mean any officer or other employee (as defined in accordance with section 3401 (c) of the Code) of the Company, or of any corporation which is a Subsidiary. 
 1.22 Exchange Act. “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. 
 1.23 Fair Market Value. “Fair Market Value” of a share of Common Stock as of a given date shall be (i) the value of a share of Common Stock at the closing of trading on such date on the principal exchange on which
shares of Common Stock are then trading, if any, or if shares were not traded on such date, then on the closest preceding date on which a trade occurred, or (ii) if the Common Stock is not publicly traded, the value of a share of Common Stock
as established by the Committee acting in good faith; provided, that any determination of Fair Market Value shall be made in compliance with section 409A of the Code and any other applicable, statutory and regulatory guidelines. 
 1.24 Grantee. “Grantee” shall mean an Officer, Employee, Independent Director, advisor or consultant granted an Award pursuant to the
terms of this Plan. 
 1.25 Incentive Stock Option. “Incentive Stock Option” shall mean an option which conforms to the
applicable provisions of section 422 of the Code and which is designated as an Incentive Stock Option by the Committee. 
 1.26
Independent Director. “Independent Director” shall mean a member of the Board who is not an Employee of the Company. 
 1.27
Non-Qualified Stock Option. “Non-Qualified Stock Option” shall mean an Option which is not an Incentive Stock Option, including any Option determined by the Committee not to constitute an Incentive Stock Option. 
  

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 1.28 Option. “Option” shall mean a stock option granted under Article III of this Plan.
An Option granted under this Plan shall, as determined by the Committee, be either a Non-Qualified Stock Option or an Incentive Stock Option; provided, however, that Options granted to Independent Directors, consultants and advisors shall be
Non-Qualified Stock Options. 
 1.29 Optionee. “Optionee” shall mean an Employee, consultant, advisor or Independent
Director granted an Option under this Plan. 
 1.30 Performance Award. “Performance Award” shall mean a cash bonus, stock
bonus or other performance or incentive award that is paid in cash, Common Stock or a combination of both, awarded under Article VIII of this Plan. 
 1.31 Performance Goals. “Performance Goals” shall mean with respect to any designated performance period as defined in Article VIII one or more Performance Measures established by the Committee prior to the beginning
of such performance period or within such period after the beginning of the performance period as shall meet the requirements to be considered “pre-established objective performance goals” for purposes of the regulations issued under
section 162(m) of the Code. Such Performance Goals may be particular to a Grantee or may be based, in whole or in part, on the performance of the division, department, line of business, subsidiary, or other business unit, whether or not legally
constituted, in which the Grantee works or on the performance of the Company generally. 
 1.32 Performance Measures.
“Performance Measures” shall include, but not be limited to (measured either absolutely or by reference to an index or indices and determined either on a consolidated basis or, as the context permits, on a divisional, subsidiary, line of
business, project or geographical basis or in combinations thereof): sales; revenues; assets; expenses; earnings before or after deduction for all or any portion of interest, taxes, depreciation, or amortization, whether or not on a continuing
operations or an aggregate or per share basis; return on equity, investment, capital or assets; one or more operating ratios; borrowing levels, leverage ratios or credit rating; market share; capital expenditures; cash flow; stock price; stockholder
return; sales of particular products or services; customer acquisition or retention; acquisitions and divestitures (in whole or in part); joint ventures and strategic alliances; spin-offs, split-ups and the like; reorganizations; or
recapitalizations, restructurings, financings (issuance of debt or equity) or refinancings. 
 1.33 Plan. “Plan” shall mean
this 2006 Incentive Plan. 
 1.34 Reporting Person. “Reporting Person” shall mean: (i) any director or officer of the
Company in the event that the Company is an issuer with a class of equity securities registered pursuant to Section 12 of the Exchange Act; and (ii) any beneficial owner of greater than 10% of a class of the Company’s equity
securities registered under Section 12 of the Exchange Act, as determined by voting or investment control over the securities pursuant to Exchange Act Rule 16a-1(a)(l). 
 1.35 Restricted Stock. “Restricted Stock” shall mean Common Stock awarded under and subject to restrictions as provided in Article VI of
this Plan. 
 1.36 Restricted Stock Unit. “Restricted Stock Unit” shall mean a notional account representing a share of
Restricted Stock. 
  

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 1.35 Retirement. “Retirement” shall mean when Grantee is fifty-five (55) or older
and has been employed by the Company for five (5) or more years after the date of the Company’s initial public offering and such Grantee terminates employment for no other reason. 
 1.36 Rule 16b-3. “Rule 16b-3” shall mean that certain Rule 16b-3 under the Exchange Act, as such Rule may be amended from time to time.

 1.37 Stock Payment. “Stock Payment” shall mean (1) a payment in the form of shares of Common Stock, or (2) a
right to purchase shares of Common Stock, as part of a deferred compensation arrangement, made in lieu of all or any portion of the compensation, including without limitation, salary, bonuses and commissions, that would otherwise become payable to
an Employee, consultant, Independent Director or advisor in cash, awarded under Article X of this Plan. 
 1.38 Subsidiary.
“Subsidiary” shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing 50 percent or more of the
total combined voting power of all classes of stock in one of the other corporations in such chain. 
 1.39 Termination of
Directorship. “Termination of Directorship” shall mean the time when a Grantee who is an Independent Director ceases to be a Director for any reason, including, but not by way of limitation, a termination by resignation, failure to be
elected, death or retirement. The Board, in its sole and absolute discretion, shall determine the effect of all matters and questions relating to Termination of Directorship. 
 1. 40 Termination of Employment. “Termination of Employment” shall mean the time when the employee-employer relationship between the
Grantee and the Company or any Subsidiary is terminated for any reason, including, but not by way of limitation, a termination by resignation, discharge, death, disability or retirement; but excluding (i) terminations where there is a
simultaneous reemployment, continuing employment or retention as a consultant or advisor of an Grantee by the Company or any Subsidiary, (ii) at the discretion of the Committee, terminations which result in a temporary severance of the
employee-employer relationship, and (iii) at the discretion of the Committee, terminations which are followed by the simultaneous establishment of a consulting relationship by the Company or a Subsidiary with the former Employee. The Committee,
in its absolute discretion, shall determine the effect of all matters and questions relating to Termination of Employment, including, but not by way of limitation, the question of whether a Termination of Employment resulted from a discharge for
good cause, and all questions of whether particular leaves of absence constitute Terminations of Employment; provided, however, that, with respect to Incentive Stock Options, 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 Employment if, and to the extent that, such leave of absence, change in status or other change interrupts employment for
the purpose of section 422(a)(2) of the Code and the then applicable regulations and revenue rulings under said section. Notwithstanding any other provision of this Plan, the Company or any Subsidiary has an absolute and unrestricted right to
terminate an Employee’s employment at any time for any reason whatsoever, with or without cause, except to the extent expressly provided otherwise in writing. 
  

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 The date of the termination of a Grantee’s service for any reason shall be determined by the
Committee in its sole discretion. For purposes of the Plan, however, the following events shall not be deemed a termination of service of a Grantee: (i) a transfer of service from the Company to a Subsidiary, from a Subsidiary to the Company,
or from one Subsidiary to another Subsidiary; or (ii) a leave of absence for military service or sickness, or for any other purpose approved by the Company, if the Grantee’s right to employment is guaranteed either by a statute or by
contract or under the policy pursuant to which the leave of absence was granted or if the Board otherwise so provides in writing; provided, however, that if the Grantee fails to resume his or her active service to the Company
upon the completion of such leave of absence, then the Committee may, to the extent permitted by applicable law, deem such Grantee’s service to have terminated as of the commencement of such leave of absence. For purposes of the Plan, employees
of a Subsidiary shall be deemed to have terminated their service on the date on which such Subsidiary ceases to be a Subsidiary. 
 The
Committee shall have full authority to determine and specify in the applicable Award Agreement the effect, if any, that a Grantee’s termination of service for any reason will have on the vesting, exercisability, payment or lapse of restrictions
applicable to an outstanding award. 
 ARTICLE II 
 SHARES SUBJECT TO PLAN 
 2.1 Shares Subject to Plan. 
 The shares of stock subject to Awards under this Plan shall be the Company’s Common Stock. The aggregate number of such shares of Common Stock, which
may be issued upon exercise of Options or Stock Appreciation Rights or upon any other Awards under the Plan, shall not exceed
                                     (“Share
Authorization”), subject to adjustment as provided in Section 12.11. The maximum number of shares of Common Stock of the Share Authorization that may be issued pursuant to ISOs under this Plan shall be
                        . The shares of Common Stock issuable upon exercise of Options or Stock Option Rights or upon
grant of any other Award may be either previously authorized but unissued shares or treasury shares. 
 2.2 Share Usage. Shares of
Common Stock covered by an Award shall be counted as used as of the date of grant. Any shares of Common Stock related to Awards under this Plan which terminate by expiration, forfeiture, cancellation, or otherwise without the issuance of such
Shares, are settled in cash in lieu of shares of Common Stock, or are exchanged with the Committee’s permission, prior to the issuance of Shares, for Awards not involving shares of Common Stock, shall be available again for grant under this
Plan. Moreover, if the Option Price of any Option granted under this Plan or the tax withholding requirements with respect to any Award granted under this Plan is satisfied by tendering shares of Common Stock to the Company (by either actual
delivery or by attestation), such tendered shares of Common Stock shall again be available for grant under this Plan. Furthermore, if a Stock Appreciation Right is exercised and settled in shares of Common Stock, the difference between the total
shares of Common Stock exercised and the net shares of Common Stock delivered shall again be available for grant under this Plan, with the result being that only the number of shares of Common Stock issued upon exercise of a Stock Appreciation Right
are counted against the Shares available. 
  

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 ARTICLE III 
 GRANTING OF OPTIONS 
 3.1 Eligibility. Any officer, Employee, consultant, advisor or Independent
Director shall be eligible to be granted an Option; provided, however, that only officers and Employees may be granted Incentive Stock Options. 
 3.2 Granting of Options. 
 (a) The Committee shall from time to time, in its absolute discretion: 
 (i) Select which Eligible Grantees shall be granted Options; 
 (ii) Determine the number of shares subject to such Options; 
 (iii) Determine whether such Options are to
be Incentive Stock Options or Non-Qualified Stock Options and whether such Options are to qualify as performance-based compensation as described in section 162(m)(4)(C) of the Code; and 
 (iv) Determine the terms and conditions of such Options, consistent with this Plan; provided, however, that the terms and
conditions of Options intended to qualify as performance-based compensation as described in section 162(m)(4)(C) of the Code shall include, but not be limited to, such terms and conditions as may be necessary to meet the applicable provisions of
section 162(m) of the Code. 
 (b) The Committee shall instruct the Secretary of the Company to issue such Options and may impose such
conditions on the grant of such Options as it deems appropriate. Without limiting the generality of the preceding sentence, the Committee may, in its discretion and on such terms as it deems appropriate, require as a condition on the grant of an
Option that the Optionee surrender for cancellation some or all of the unexercised Options, awards of Restricted Stock or Deferred Stock, Performance Awards, Dividend Equivalents, Stock Payments or other awards or rights which have been previously
granted to him or her under this Plan or otherwise. Such grant or other Award may contain such terms and conditions as the Committee deems appropriate and shall be exercisable in accordance with its terms, subject to statutory and regulatory
compliance. 
 3.3 Special Rules Applicable to Incentive Stock Options. 
 (a) No person may be granted an Incentive Stock Option under this Plan if such person, at the time the Incentive Stock Option is granted, owns stock
possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any then existing Subsidiary unless the exercise price per share is not less than one hundred ten percent (110%) of the
Fair Market Value per share of Common Stock on the grant date of the Incentive Stock Option and the term does not exceed five (5) years measured from such grant date. 
 (b) No Incentive Stock Option shall be granted unless such Option, when granted, qualifies as an “incentive stock option” under section 422 of
the Code. No Incentive Stock Option shall be granted to any person who is not an Employee. 
  

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 (c) Any Incentive Stock Option granted under this Plan may be modified by the Committee to disqualify
such option from treatment as an “incentive stock option” under section 422 of the Code. 
 (d) To the extent that the aggregate
Fair Market Value of a Share of Common 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 an
Optionee during any calendar year (under the Plan and all other incentive stock option plans of the Company and any Subsidiary) exceeds $100,000, such Options shall be treated as Non-Qualified Options to the extent required by section 422 of the
Code and subject to the provisions of Section 3.4 of this Plan and the Company shall issue separate certificates to the Grantee with respect to Options that are Non-Qualified Options and Options that are Incentive Stock Options. The rule set
forth in the preceding sentence shall be applied by taking Options into account in the order in which they were granted. For purposes of this Section 3.3(d), the Fair Market Value of stock shall be determined as of the time the Option with
respect to such Common Stock is granted. 
 3.4 Substitute Options. In the event that the Company or any Subsidiary consummates a
transaction described in section 424(a) of the Code (relating to the acquisition of property or stock from an unrelated corporation), individuals who become employees of the Company or any Subsidiary on account of such transaction may be granted
Incentive Stock Options in substitution for options granted by their former employer, subject to the requirements of section 409A of the Code. The Committee, in its sole discretion and consistent with sections 409A and 424(a) of the Code, shall
determine the exercise price of such substitute Options. 
 ARTICLE IV 
 TERMS OF OPTIONS 
 4.1 Option Agreement. Each Option shall be evidenced by an
Award Agreement, which shall be executed by the Optionee and an authorized officer of the Company and which shall contain such terms and conditions as the Committee shall determine, consistent with this Plan. Award Agreements evidencing Options
intended to qualify as performance-based compensation as described in section l62(m)(4)(C) of the Code 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. Any Award Agreement may require that the Grantee agree to be bound by any stockholders’
agreement among all or certain stockholders of the Company that may be in effect at the time of either the grant of an Award or the exercise of an Option, if applicable, or certain provisions of any such agreement that may be specified by the
Committee. 
 4.2 Option Price. The Option price for each grant of an Option shall be set by the Committee and shall be specified in
the applicable Award Agreement; provided, however, that (i) in the case of Non-Qualified Stock Options, such price shall be no less than 100% of the Fair Market Value of a share of Common Stock on the date such
Non-Qualified Stock Option is granted, and (ii) in the case of Options intended to qualify as Incentive Stock Options or as performance-based compensation as described in section 162(m)(4)(C) of the Code such price shall be no less than 100% of
the Fair Market Value of a share of Common Stock on the date 
  

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 such Incentive Stock Option is granted (110% of the Fair Market Value of a share of Common Stock on the date such
Incentive Stock Option is granted in the case of 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). 
 4.3 Option Term. The term of an Option shall be set by the Committee in its discretion; provided, however, that, in
the case of Incentive Stock Options, the term shall not be more than ten (10) years from the date the Incentive Stock Option is granted, or five (5) years from such date if the Incentive Stock Option is granted to 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. 
 4.4 Option Vesting and Exercisability. Options shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Committee at or after grant. The Committee may
provide, in its discretion, that any Stock Option shall be exercisable only in installments, and the Committee may waive such installment exercise provisions at any time in whole or in part based on such factors as the Committee may determine, in
its sole discretion, including but not limited to in connection with any Change in Control of the Company, as defined in Section 12 herein. Notwithstanding the foregoing, the Committee may accelerate (i) the vesting of any Option
(including an Incentive Stock Option) and (ii) the date on which any Option first becomes exercisable. An Incentive Stock Option shall not be exercisable until such Incentive Stock Option is vested. 
 4.5 Expiration of Options. A Grantee’s Options shall expire as set forth in the applicable Award Agreement. Notwithstanding anything to the
contrary in the Plan, if the Committee determines after the Grantee’s Termination of Employment that the Grantee has engaged in conduct constituting Cause (whether before or after such Termination of Employment), the Grantee’s Options
shall terminate immediately to the extent not exercised in accordance with the terms of this Agreement. 
 ARTICLE V 
 EXERCISE OF OPTIONS 
 5.1 Partial
Exercise. An exercisable Option may be exercised in whole or in part, as determined by the Committee on the date of grant. However, an Option shall not be exercisable with respect to fractional shares and the Committee may require that, by the
terms of the Option, a partial exercise be with respect to a minimum number of shares. 
 5.2 Manner of Exercise. All or a portion of
an exercisable Option shall be deemed exercised upon delivery of all of the following to the Secretary of the Company or the Secretary’s office: 
 (a) A written notice complying with the applicable rules established by the Committee stating that the Option, or a portion thereof, is to be exercised. The notice shall be signed by the Optionee or other person then
entitled to exercise the Option or such portion thereof; 
 (b) Such representations and documents as the Committee, in its absolute
discretion, deems necessary or advisable to effect compliance with all applicable provisions of the 
  

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 Securities Act of 1933, as amended, and any other federal or state securities laws or regulations. The Committee may, in
its absolute discretion, also take whatever additional actions it deems appropriate to effect such compliance including, without limitation, placing legends on share certificates and issuing stop-transfer notices to agents and registrars;

 (c) In the event that the Option shall be exercised pursuant to Section 5.1 by any person or persons other than the Optionee,
appropriate proof of the right of such person or persons to exercise the Option; and 
 (d) Full cash payment to the Secretary of the Company
for the shares of Common Stock with respect to which the Option, or portion thereof, is exercised. However, at the discretion of the Committee and subject to compliance with applicable statutory and regulatory guidance, the terms of the Option and
related Award Agreement may (i) allow payment, in whole or in part, through the delivery of shares of Common Stock owned by the Optionee, duly endorsed for transfer to the Company with a Fair Market Value on the date of delivery equal to the
aggregate exercise price of the Option or exercised portion thereof; (ii) allow payment, in whole or in part, through the surrender of shares of Common Stock then issuable upon exercise of the Option having a Fair Market Value on the date of
Option exercise equal to the aggregate exercise price of the Option or exercised portion thereof; (iii) allow payment through any combination of cash, the delivery shares or surrender of shares; or (iv) if the Common Stock is then traded
on a national securities exchange, allow payment by delivery of an irrevocable undertaking, satisfactory in form and substance to the Company, by a creditworthy securities broker to sell shares of Common Stock issuable upon the exercise of the
Option or portion thereof and to deliver promptly to the Company, the proceeds of such sale in an amount necessary and sufficient to fund the aggregate exercise price and any applicable withholding or employment taxes, or allow payment by delivery
by the Optionee to the Company of a copy of irrevocable instructions, satisfactory in form and substance to the Company, to a creditworthy securities broker to sell shares of Common Stock issuable upon the exercise of the Option or portion thereof
and to deliver promptly to the Company the proceeds of such sale in an amount necessary and sufficient to fund the aggregate exercise price and any applicable withholding or employment taxes. 
 5.3 Conditions to Issuance of Stock Certificate. The Company shall not be required to issue or deliver any certificate or certificates for shares
of Common Stock purchased upon the exercise of any Option or portion thereof prior to fulfillment of all of the following conditions: 
 (a)
The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; 
 (b) The completion of any
registration or other qualification of such shares under any state or federal law, or under the rulings or regulations of the Securities and Exchange Commission or any other governmental regulatory body which the Committee shall, in its absolute
discretion, deem necessary or advisable; 
 (c) The obtaining of any approval or other clearance from any state or federal governmental
agency which the Committee shall, in its absolute discretion, determine to be necessary or advisable; 
  

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 (d) The lapse of such reasonable period of time following the exercise of the Option as the Committee may
establish from time to time for reasons of administrative convenience; 
 (e) The receipt by the Company of full payment for such shares,
including payment of any applicable withholding or employment tax; and 
 (f) Compliance with the terms of this Plan and any other applicable
agreements pertaining to the Award. 
 5.4 Rights as Stockholders. The holders of Options shall not be, nor have any of the rights or
privileges of, stockholders of the Company in respect of any shares purchasable upon the exercise of an Option unless and until certificates representing such shares have been issued by the Company to such holders and such holder has entered into
any applicable stockholder agreement, as determined by the Committee in its sole discretion. 
 5.5 Ownership and Transfer
Restrictions. In addition to the restrictions set forth in Section 12.1 of this Plan, the Committee, in its absolute discretion, may impose such restrictions on the ownership and transferability of the shares purchasable upon the exercise
of an Option as it deems appropriate. Any such restriction shall be set forth in the respective Option Award Agreement and may be referred to on the certificates evidencing such shares. The Committee may require the Optionee to give the Company
prompt notice of any disposition of shares of Common Stock acquired by exercise of an Incentive Stock Option within (i) two (2) years from the date the Option was granted or (ii) one (1) year after the transfer of such shares to
the Optionee. The Committee may direct that the certificates evidencing shares acquired by exercise of an Option refer to such requirement to be given prompt notice of disposition. 
 ARTICLE VI 
 AWARD OF RESTRICTED STOCK AND STOCK UNITS 
 6.1 Award of Restricted Stock. 
 (a)
The Committee shall from time to time, in its absolute discretion, select which Eligible Grantee shall be awarded Restricted Stock or Restricted Stock Units, and determine the purchase price, if any, and other terms and conditions applicable to such
Restricted Stock or Restricted Stock Units, consistent with this Plan. 
 (b) The Committee shall establish the purchase price, if any, and
form of payment for Restricted Stock or Restricted Stock Units, including any consideration required by applicable law. Awards of Restricted Stock or Restricted Stock Units may be made for no consideration (other than par value of the shares which
is deemed paid by services already rendered). The Committee shall instruct the Secretary of the Company to issue such Restricted Stock or Restricted Stock Units, and may impose such conditions on the issuance of such Restricted Stock or Restricted
Stock Units, as it deems appropriate. 
 6.2 Restricted Stock Agreement. Restricted Stock and Restricted Stock Unit grants shall be
issued only pursuant to a written Award Agreement, which shall be executed by the Grantee and an authorized officer of the Company and which shall contain such terms and conditions as the Committee shall determine, consistent with this Plan.

  

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 6.3 Rights as Stockholders. Upon delivery of the shares of Restricted Stock to the escrow holder
pursuant to Section 6.5, the Grantee of a Restricted Stock Award shall have, unless otherwise provided by the Committee, all the rights of a stockholder with respect to said shares, subject to the restrictions set forth in the applicable Award
Agreement and any applicable stockholder agreement, including the right to receive all dividends and other distributions paid or made with respect to the shares; provided, however, that in the discretion of the Committee,
any extraordinary distributions with respect to shares of Common Stock shall be subject to the restrictions set forth in Section 6.4. 
 6.4 Restriction. All shares of Restricted Stock and Restricted Stock Units issued under this Plan (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, in the terms of applicable Award Agreement, be subject to such restrictions as the Committee shall provide, which restrictions may include, without limitation, restrictions concerning voting
rights and transferability and restrictions based on duration of employment with the Company, Company performance and individual performance; provided, however, that by a resolution adopted after the Restricted Stock or
Restricted Stock Unit is granted, the Committee may, on such terms and conditions as it may determine to be appropriate, remove any or all of the restrictions imposed by the terms of the applicable Award Agreement. Restricted Stock may not be sold
or encumbered until all restrictions are terminated or expire. 
 6.5 Escrow. The Secretary of the Company or such other escrow holder
as the Committee may appoint shall retain physical custody of each certificate representing Restricted Stock until all of the restrictions imposed under the applicable Award Agreement with respect to the Restricted Stock evidenced by such
certificate expire or shall have been removed. 
 6.6 Legend. In order to enforce the restrictions imposed upon shares of Restricted
Stock hereunder, the Committee shall cause a legend or legends to be placed on certificates representing all shares of Restricted Stock that are still subject to restrictions under applicable Award Agreements, which legend or legends shall make
appropriate reference to the conditions imposed thereby. 
 ARTICLE VII 
 STOCK APPRECIATION RIGHTS 
 7.1 Grant of SARs. Subject to the provisions of the
Plan, the Committee may grant rights to receive any excess in value of shares of Common Stock over the exercise price (“Stock Appreciation Rights” or “SARs”) in tandem with an Option (at or after the award of the
Option), or alone and unrelated to an Option. SARs in tandem with an Option shall terminate to the extent that the related Option is exercised, and the related Option shall terminate to the extent that the tandem SARs are exercised. The Committee
shall determine at the time of grant or thereafter whether SARs are settled in cash, Common Stock or other securities of the Company, Awards or other property, and may define the manner of determining the excess in value of the shares of Common
Stock. 
 7.2 Exercise Price. The Committee shall fix the exercise price of each SAR or specify the manner in which the price shall be
determined; provided, that, such exercise price shall be no less than 100% of the Fair Market Value of a share of Common Stock on the date 
  

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 such SAR is granted. An SAR granted in tandem with an Option shall have an exercise price not less than the exercise
price of the related Option. SARs granted alone and unrelated to an Option may be granted at such exercise prices as the Committee may determine. 
 7.3 Treatment of Dividend Rights. No SAR shall include a right to dividends between the date of grant and date of exercise in the absence of a separate agreement. 
 7.4 Other Terms. The Committee shall determine at the date of grant or thereafter, the time or times at which and the circumstances under which an
SAR may be exercised in whole or in part (including based on achievement of performance goals and/or future service requirements), the time or times at which SARs shall cease to be or become exercisable following termination of Service or upon other
conditions, the method of exercise, method of settlement, form of consideration payable in settlement which may be cash or shares of Common Stock, method by or forms in which shares of Common Stock will be delivered or deemed to be delivered to
Grantees, whether or not an SAR shall be in tandem or in combination with any other Award, and any other terms and conditions of any SAR. 
 ARTICLE VIII 
 PERFORMANCE AND ANNUAL INCENTIVE AWARDS 
 8.1 Performance Conditions. The right of a Grantee to exercise or receive a grant or settlement of any Award, and the timing thereof, may be subject to such performance conditions as may be specified by the
Committee. The Committee may use such business criteria and other performance measures as it may deem appropriate in establishing any performance conditions, and may exercise its discretion to reduce the amounts payable under any Award subject to
performance conditions, except as limited under Sections 8.2 hereof in the case of a Performance Award or Annual Incentive Award intended to qualify under section 162(m) of the Code. If and to the extent required under section 162(m),
any power or authority relating to a Performance Award or Annual Incentive Award intended to qualify under section 162(m), shall be exercised by the Committee and not the Board. To the extent permitted by applicable law, the Committee may
delegate to one or more executive officers of the Company the power to make Awards to Grantees who are not Reporting Persons or Covered Employees and all determinations under the Plan with respect thereto, provided that the Committee shall fix the
maximum amount of such Awards for all such Grantees and a maximum for any one Grantee. 
 8.2 Performance or Annual Incentive Awards
Granted to Designated Covered Employees. If and to the extent that the Committee determines that a Performance or Annual Incentive Award to be granted to a Grantee who is designated by the Committee as likely to be a Covered Employee should
qualify as “performance-based compensation” for purposes of section 162(m), the grant, exercise and/or settlement of such Performance or Annual Incentive Award shall be contingent upon achievement of pre-established performance goals
and other terms set forth in this Section 8.2. 
 (a) Performance Goals Generally. The Performance Goals for Performance Awards
or Annual Incentive Awards shall consist of one or more Performance Measures and a targeted level or levels of performance with respect to each of such criteria, as specified by the Committee consistent with this Section 8.2. Performance Goals
shall be objective and shall otherwise meet the requirements of section 162(m) of the Code and regulations thereunder, 
  

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 including the requirement that the level or levels of performance targeted by the Committee result in the achievement of
Performance Goals being “substantially uncertain.” The Committee may determine that Performance Awards or Annual Incentive Awards shall be granted, exercised and/or settled upon achievement of any one Performance Goal or that two or more
of the Performance Goals must be achieved as a condition to grant, exercise and/or settlement of such Performance Awards or Annual Incentive Awards. Performance Goals may differ for Performance Awards or Annual Incentive Awards granted to any one
Grantee or to different Grantees. 
 (b) Timing For Establishing Performance Goals. Performance Goals shall be established not later
than 90 days after the beginning of any performance period applicable to such Performance Awards or Annual Incentive Awards, or at such other date as may be required or permitted for “performance-based compensation” under
section 162(m) of the Code. 
 (c) Performance or Annual Incentive Award Pool. The Committee may establish a Performance Awards
or Annual Incentive Award pool, which shall be an unfunded pool, for purposes of measuring Company performance in connection with Performance Awards or Annual Incentive Awards. 
 (d) Settlement of Performance or Annual Incentive Awards; Other Terms. Settlement of such Performance Awards or Annual Incentive Awards shall be
in cash, shares of Common Stock, other Awards or other property, in the discretion of the Committee. The Committee may, in its discretion, reduce the amount of a settlement otherwise to be made in connection with Performance Awards or Annual
Incentive Awards. The Committee shall specify the circumstances in which Performance Awards or Annual Incentive Awards shall be paid or forfeited in the event of the Grantee’s Termination of Employment prior to the end of a performance period
or settlement of the Performance Awards. 
 8.3 Written Determinations. All determinations by the Committee as to the establishment of
Performance Goals, the amount of any Performance Award pool or potential individual Performance Awards and as to the achievement of Performance Goals relating to Performance Awards, and the amount of any Annual Incentive Award pool or potential
individual Annual Incentive Awards and the amount of final Annual Incentive Awards, shall be made in writing in the case of any Award intended to qualify under section 162(m). To the extent required to comply with section 162(m) of the
Code, the Committee may delegate any responsibility relating to such Performance Awards or Annual Incentive Awards. 
 8.4 Status of
Awards Under Section 162(m). It is the intent of the Company that Performance Awards and Annual Incentive Awards under Section 8.2 hereof granted to persons who are designated by the Committee as likely to be Covered Employees within
the meaning of section 162(m) of the Code and regulations thereunder shall, if so designated by the Committee, constitute “qualified performance-based compensation” within the meaning of section 162(m) of the Code and regulations
thereunder. Accordingly, the terms of Section 8.2, including the definitions of Covered Employee and other terms used therein, shall be interpreted in a manner consistent with section 162(m) and regulations thereunder. The foregoing
notwithstanding, because the Committee cannot determine with certainty whether a given Grantee will be a Covered Employee with respect to a fiscal year that has not yet been completed, the term Covered Employee as used herein shall mean only a
person designated by the Committee, at the time of grant of Performance Awards or an Annual Incentive Award, as 
  

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 likely to be a Covered Employee with respect to that fiscal year. If any provision of the Plan or any Award Agreement
relating to such Performance Awards or Annual Incentive Awards does not comply or is inconsistent with the requirements of section 162(m) of the Code or regulations thereunder, such provision shall be construed or deemed amended to the extent
necessary to conform to such requirements. 
 ARTICLE IX 
 PARACHUTE LIMITATIONS 
 Notwithstanding any other provision of this Plan or of any other agreement,
contract, or understanding heretofore or hereafter entered into by a Grantee with the Company or any Affiliate, except an agreement, contract, or understanding between the Grantee and the Company or any Affiliate that modifies or excludes
application of this paragraph (an “Other Agreement”), and notwithstanding any formal or informal plan or other arrangement for the direct or indirect provision of compensation to the Grantee (including groups or classes of Grantees
or beneficiaries of which the Grantee is a member), whether or not such compensation is deferred, is in cash, or is in the form of a benefit to or for the Grantee (a “Benefit Arrangement”), if the Grantee is a “disqualified
individual,” as defined in section 280G(c) of the Code, any Award held by that Grantee and any right to receive any payment or other benefit under this Plan shall not become exercisable or vested (i) to the extent that such right to
exercise, vesting, payment, or benefit, taking into account all other rights, payments, or benefits to or for the Grantee under this Plan, all Other Agreements, and all Benefit Arrangements, would cause any payment or benefit to the Grantee under
this Plan to be considered a “parachute payment” within the meaning of section 280G(b)(2) of the Code as then in effect (a “Parachute Payment”) and (ii) if, as a result of receiving a Parachute Payment, the aggregate
after-tax amounts received by the Grantee from the Company under this Plan, all Other Agreements, and all Benefit Arrangements would be less than the maximum after-tax amount that could be received by the Grantee without causing any such payment or
benefit to be considered a Parachute Payment. In the event that the receipt of any such right to exercise, vesting, payment, or benefit under this Plan, in conjunction with all other rights, payments, or benefits to or for the Grantee under any
Other Agreement or any Benefit Arrangement would cause the Grantee to be considered to have received a Parachute Payment under this Plan that would have the effect of decreasing the after-tax amount received by the Grantee as described in clause
(ii) of the preceding sentence, then the Grantee shall have the right, in the Grantee’s sole discretion, to designate those rights, payments, or benefits under this Plan, any Other Agreements, and any Benefit Arrangements that should be
reduced or eliminated so as to avoid having the payment or benefit to the Grantee under this Plan be deemed to be a Parachute Payment. 
 ARTICLE X 
 UNRESTRICTED AND DEFERRED STOCK, DIVIDEND EQUIVALENT RIGHTS, OR OTHER AWARDS 
 10.1 Dividend Equivalents. Any Eligible Grantee selected by the Committee may be granted Dividend Equivalent Rights. A Dividend Equivalent Right
is an Award entitling the recipient to receive credits based on cash distributions that would have been paid on the shares of Common Stock specified in the Dividend Equivalent Right (or other award to which it relates) if such shares had been issued
to and held by the recipient. A Dividend Equivalent Right 
  

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 may be granted hereunder to any Grantee as a component of another Award or as a freestanding Award. The terms and
conditions of Dividend Equivalent Rights shall be specified in the grant. Dividend Equivalents credited to the holder of a Dividend Equivalent Right may be paid currently, may be accrued and paid at a later date subject to completion of a vesting
condition or may be deemed to be reinvested in additional shares of Common Stock, which may thereafter accrue additional equivalents. Any such reinvestment shall be at the Fair Market Value of a share of Common Stock on the date of reinvestment.
Dividend Equivalent Rights may be settled in cash or Common Stock or a combination thereof, in a single installment or installments, all determined in the sole discretion of the Committee. A Dividend Equivalent Right granted as a component of
another Award may provide that such Dividend Equivalent Right shall be settled upon exercise, settlement, or payment of, or lapse of restrictions on, such other award, and that such Dividend Equivalent Right shall expire or be forfeited or annulled
under the same conditions as such other award. A Dividend Equivalent Right granted as a component of another Award may also contain terms and conditions different from such other award. 
 10.2 Unrestricted Stock. The Committee may, in its sole discretion, grant (or sell at par value or such other higher purchase price determined by
the Committee) an Unrestricted Stock Award to any Grantee pursuant to which such Grantee may receive shares of Common Stock free of any restrictions (“Unrestricted Stock”) under the Plan. Unrestricted Stock Awards may be granted or
sold as described in the preceding sentence in respect of past services and other valid consideration, or in lieu of, or in addition to, any cash compensation due to such Grantee. 
 10.3 Deferred Stock. Any Eligible Grantee selected by the Committee may be granted an Award of Deferred Stock in the manner determined from time
to time by the Committee. The number of shares of Deferred Stock shall be determined by the Committee and may be linked to the market value, book value, net profits or other measure of the value of Common Stock or other specific performance criteria
determined appropriate by the Committee. Common Stock underlying a Deferred Stock Award will not be issued until the Deferred Stock Award has vested, pursuant to a vesting schedule or performance criteria set by the Committee. Unless otherwise
provided by the Committee, a Grantee of Deferred Stock shall have no rights as a Company stockholder with respect to such Deferred Stock until such time as the Award has vested and the Common Stock underlying the Award has been issued. 

10.4 Other Stock Based Awards. The Committee shall have the right to grant such Awards based upon the Common Stock having terms and conditions
as the Committee may determine, including, without limitation, the grant of shares based upon certain conditions, the grant of securities convertible into Common Stock and the grant of warrants to purchase Common Stock. 
 10.5 Form of Agreement. Each Award granted pursuant to this Article X shall be evidenced by an Award Agreement, which shall be executed by the
Grantee and an authorized officer of the Company and which shall contain such terms and conditions as the Committee shall determine, consistent with this Plan, including the term of the Award and payment on exercise and vesting. 
  

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 ARTICLE XI 
 ADMINISTRATION 
 11.1 Compensation Committee. The Compensation Committee (or a subcommittee of the
Board assuming the functions of the Committee under this Plan) shall consist of two (2) or more Directors appointed by and holding office at the pleasure of the Board. To the extent applicable, the members of the Committee shall each be an
“outside director” as defined under section 162(m) of the Code. Appointment of Committee members shall be effective upon acceptance of appointment. Committee members may resign at any time by delivering written notice to the Board.
Vacancies in the Committee may be filled by the Board. 
 To the extent applicable, during the period any Independent Director is serving on
the Committee, he or she shall not (i) be an officer of the Company or a parent or Subsidiary of the Company, or otherwise currently employed by the Company or a parent or Subsidiary of the Company; (ii) receive compensation, either
directly or indirectly, from the Company or a parent or Subsidiary of the Company for services rendered as a consultant or in any capacity other than as a Director, except for an amount that does not exceed the dollar amount for which disclosure
would be required pursuant to Rule 404(a) of the Exchange Act; (iii) possess an interest in any other transaction for which disclosure would be required pursuant to Rule 404(a); and (iv) be engaged in a business relationship for which
disclosure would be required pursuant to Rule 404(b). The requirements of this subsection are intended to comply with Rule 16b-3 under Section 16 of the Exchange Act or any successor rule or regulation, and shall be interpreted and construed in
a manner which assures compliance with said Rule. To the extent said Rule 16b-3 is modified to reduce or increase the restrictions on who may serve on the Committee, the Plan shall be deemed modified in a similar manner. 
 11.2 Duties and Powers of Committee. The Committee shall be responsible for the administration of the Plan. The Committee shall select the
Grantees to receive Awards and determine the terms and conditions of such Awards. To the extent permitted by applicable law, the Committee may delegate to one or more executive officers of the Company the power to make Awards to Grantees who are not
Reporting Persons or Covered Employees and all determinations under the Plan with respect thereto, provided that the Committee shall fix the maximum amount of such Awards for all such Grantees and a maximum for any one Grantee. It shall be the duty
of the Committee to conduct the general administration of this Plan in accordance with its provisions. The Committee shall have the power to interpret this Plan and the agreements pursuant to which Awards are granted or awarded, and to adopt such
rules for the administration, interpretation, and application of this Plan as are consistent therewith and to interpret, amend or revoke any such rules. Any Awards need not be the same with respect to each Grantee. Any such interpretations and rules
with respect to Incentive Stock Options shall be consistent with the provisions of section 422 of the Code. In its absolute discretion, the Board may at any time and from time to time exercise any and all rights and duties of the Committee under
this Plan except with respect to matters which under Rule 16b-3 or section 162(m) of the Code, or any regulations or rules issued thereunder, are required to be determined in the sole discretion of the Committee. In this regard, to the extent that
the guidelines pursuant to section 162(m) of the Code are applicable, not only will the Committee consist solely of two or more outside directors but the Committee shall be required to certify that any Performance Goals and/or other material terms
associated with any Award have been satisfied prior to the payment of any Award pursuant to Article VIII. 
  

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 11.3 Majority Rule. The Committee shall act by a majority of its members in attendance at a
meeting at which a quorum is present or by a memorandum or other written instrument signed by all members of the Committee. 
 11.4
Expense Reimbursement; Professional Assistance; Good Faith Actions. All expenses and liabilities which members of the Committee incur in connection with the administration of this Plan shall be borne by the Company. The Committee may, with
the approval of the Board, employ attorneys, consultants, accountants, appraisers, brokers, or other persons. The Committee, the Company and the Company’s officers and Directors shall be entitled to rely upon the advice, opinions or valuations
of any such persons. All actions taken and all interpretations and determinations made by the Committee in good faith shall be final and binding upon all Grantees, the Company and all other interested persons. No members of the Committee or Board
shall be personally liable for any action, determination or interpretation made in good faith with respect to this Plan or any Award under this Plan and the Committee and the Board shall be fully protected and indemnified by the Company in respect
of any such action, determination or interpretation. 
 ARTICLE XII 
 MISCELLANEOUS PROVISIONS 
 12.1 Not Transferable. Except as otherwise provided
in an Award Agreement, Awards under this Plan may not be sold, pledged, assigned, or transferred in any manner other than by will or the laws of descent and distribution, unless and until such rights or awards have been exercised, or the shares
underlying such rights or awards have been issued, and all restrictions applicable to such shares have lapsed. No Award or interest or right therein shall be liable for the debts, contracts or engagements of the Grantee or his or her successors in
interest nor shall it be subject to disposition by transfer, alienation, anticipation, pledge, 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), and any attempted disposition thereof shall be null and void and of no effect; provided however, that this Section 12.1 shall not prevent (1) transfers by will
or by the applicable laws of descent and distribution, or (2) the designation of a beneficiary to exercise any Option or other right or award (or any portion thereof) granted under the Plan after the Grantee’s death. 
 During the lifetime of the Grantee, only the Grantee, may exercise an Option or other Award (or any portion thereof) granted under the Plan. After the
death of the Grantee, any exercisable portion of an Option or other Award may, subject to the terms of such Option, or other Award, be exercised by the Grantee’s personal representative or by any person empowered to do so under a beneficiary
designation, under a will or under the then applicable laws of descent and distribution. 
 12.2 Amendment, Suspension or Termination of
this Plan. This Plan shall terminate on the tenth anniversary of the Board’s adoption of this Plan. This Plan may be wholly or partially amended or otherwise modified, suspended or terminated at any time or from time to 
  

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 time by the Committee. However, without approval of the Company’s stockholders given within twelve months before or
after the action by the Committee, no action of the Committee may, except as provided in Section 12.3, increase the limits imposed in Section 2.1 on the maximum number of shares which may be issued under this Plan, increase the per-Grantee
limitation in Section 2.1 or change the class of employee entitled to participate in the Plan, and no action of the Committee may be taken that would otherwise require stockholder approval as a matter of applicable law, regulation or rule. No
amendment, suspension or termination of this Plan shall, without the consent of the holder of, alter or impair any rights or obligations under any Award granted or awarded, unless the Award itself otherwise expressly so provides. No Awards may be
granted or awarded during any period of suspension or after termination of this Plan, and in no event may any Incentive Stock Option be granted under this Plan after the first to occur of the following events: 
 (a) The expiration of ten years from the date the Plan is adopted by the Board; or 
 (b) The expiration of ten years from the date the Plan is last approved by the Company’s stockholders under Section 12.3. 
 12.3 Approval of Plan by Stockholders. This Plan will be submitted for the approval of the Company’s stockholders within twelve months after
the date of the Board’s initial adoption of this Plan. Options, Performance Awards, Dividend Equivalents, Stock Payments or other Awards may be granted and Restricted Stock, Restricted Stock Units, or Deferred Stock may be awarded prior to such
stockholder approval, provided that such Options, Performance Awards, Dividend Equivalents, Stock Payments or other awards shall not be exercisable and such Restricted Stock, Restricted Stock Units, or Deferred Stock shall not vest prior to the time
when this Plan is approved by the stockholders, and provided further that if such approval has not been obtained at the end of said twelve (12) month period, all Options, Performance Awards, Dividend Equivalents, Stock Payments or other awards
previously granted and all Restricted Stock, Restricted Stock Units, or Deferred Stock previously awarded under this Plan shall thereupon be canceled and become null and void. 
 12.4 Limitations Applicable to Section 16 Persons and Performance-Based Compensation. Notwithstanding any other provision of this Plan, any
Award granted or awarded, to an Employee or Director 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 any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule, and this Plan shall be deemed amended to the extent necessary to conform to such limitations. Furthermore, notwithstanding
any other provision of this Plan, any Option or other Awards intended to qualify as performance-based compensation as described in section 162(m)(4)(C) of the Code shall be subject to any additional limitations set forth in section 162(m) of the
Code (including any amendment to section 162(m) of the Code) or any Treasury regulations or rulings issued thereunder that are requirements for qualification as performance-based compensation as described in section 162(m)(4)(C) of the Code, and
this Plan shall be deemed amended to the extent necessary to conform to such requirements. 
 12.5 Effect of Plan Upon Options and
Compensation Plans. The adoption of this Plan shall not affect any other compensation or incentive plans in effect for the Company or any Subsidiary. Neither Awards made under this Plan nor shares of Common Stock or cash paid 
  

 - 23 - 

 pursuant to such Awards may be included as “compensation” for purposes of computing the benefits payable to any
Grantee under the Company’s or any Subsidiary’s or Affiliate’s retirement plans (both qualified and nonqualified) or welfare benefit plans unless such other plan expressly provides that such compensation shall be taken into account in
computing a Grantee’s benefit. Nothing in this Plan shall be construed to limit the right of the Company (1) to establish any other forms of incentives or compensation for Employees of the Company or any Subsidiary or (2) to grant or
assume options or other rights otherwise than under this Plan in connection with any proper corporate purpose including but not by way of 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, firm or association. 
 12.6 Compliance with
Laws. This Plan, the granting and vesting of Awards under this Plan and the issuance and delivery of shares of Common Stock and the payment of money under this Plan or under such Awards made hereunder are subject to compliance with all
applicable federal and state laws, rules and regulations (including but not limited to state and federal securities law and federal margin requirements and the requirements of the Code) 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 this 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 applicable legal requirements. To the extent permitted by applicable law, the
Plan, and Awards made hereunder shall be deemed amended to the extent necessary to conform to such laws, rules and regulations. 
 12.7
Titles. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Plan. 
 12.8 Governing Law. This Plan and any agreements hereunder shall be administered, interpreted and enforced under the internal laws of the State of Delaware without regard to conflicts of laws thereof. Unless otherwise provided in the
Award Agreement, recipients of an Award under this Plan are deemed to submit to the exclusive jurisdiction and venue of the federal or state courts of Delaware, to resolve any and all issues that may arise out of or relate to this Plan or any
related Award Agreement. 
 12.9 Change in Control. Notwithstanding any other provision of the Plan, and the provisions of any
particular Award Agreement, in the event of any Change in Control (as defined below) of the Company, and in anticipation thereof if required by the circumstances, the Board, in its sole discretion (and in addition to or in lieu of any actions
permitted to be taken by the Company under the terms of any particular Award Agreement), may, on either an overall or a Grantee by Grantee basis, (i) accelerate the exercisability, prior to the effective date of such Change in Control, of any
outstanding Options and SARs (and terminate the restrictions applicable to Restricted Stock Units and any shares of Restricted Stock), (ii) upon written notice, provide that any outstanding Options and SARs must be exercised, to the extent then
exercisable, within a specified number of days after the date of such notice, at the end of which period such Options shall terminate, (iii) if there is a surviving or acquiring entity, and subject to the consummation of such Change in Control,
cause that entity or a Subsidiary of that entity to grant 
  

 - 24 - 

 replacement awards having such terms and conditions as the Board determines to be appropriate in its sole discretion,
upon which replacement the replaced Awards shall be terminated or cancelled, as the case may be, (iv) terminate any outstanding Awards and make such payments, if any, therefor (or cause the surviving or acquiring entity to make such payments,
if any, therefor) as the Board determines to be appropriate in its sole discretion (including, without limitation, with respect to only the then exercisable portion of such Options and SARs based on the Fair Market Value of the underlying shares of
Common Stock as determined by the Board in good faith), upon which termination such Options and SARs shall immediately cease to have any further force or effect, (v) repurchase (or cause the surviving or acquiring entity to purchase) any shares
of Restricted Stock for such amounts, if any, as the Board determines to be appropriate in its sole discretion (including, without limitation, an amount with respect to only the vested portion of such shares (i.e., the portion that is not then
subject to forfeiture or repurchase at a price less than their value), based on the Fair Market Value of such vested portion as determined by the Board in good faith), upon which purchase the holder of such shares shall surrender such shares to the
purchaser, or (vi) take any combination (or none) of the foregoing actions. A “Change in Control” shall mean and include any of the following: 
 (a) consummation of a merger or consolidation of the Company with or into any other corporation or other entity in which holders of the Company’s voting securities immediately prior to such merger or
consolidation will not, directly or indirectly, continue to hold at least a majority of the outstanding voting securities of the Company; 
 (b) a sale, lease, exchange or other transfer (in one transaction or a related series of transactions) of all or substantially all of the Company’s assets; 
 (c) the acquisition by any person or any group of persons, acting together in any transaction or related series of transactions, of such quantity of the Company’s voting securities as causes such person, or group
of persons, to own beneficially, directly or indirectly, as of the time immediately after such transaction or series of transactions, 50% or more of the combined voting power of the voting securities of the Company other than as a result of
(i) an acquisition of securities directly from the Company or (ii) an acquisition of securities by the Company which by reducing the voting securities outstanding increases the proportionate voting power represented by the voting
securities owned by any such person or group of persons to 50% or more of the combined voting power of such voting securities; or 
 (d) a
change in the composition of the Board within a two (2) year period such that a majority of the members of the Board are not Continuing Directors; or 
 (e) the liquidation or dissolution of the Company. 
 12.10 Withholding. Requirements and
Arrangements. 
 (a) Options and SARs. In the case of any Option or SAR, the Committee may require the Grantee to remit to the
Company an amount sufficient to satisfy the federal, state and local withholding and employment tax obligations of the Company with respect to the exercise of such Option (or make other arrangements satisfactory to the Committee with regard to such
taxes, including withholding from regular cash compensation, providing other security to the Company, or remitting or foregoing the receipt of shares of Common Stock having a Fair Market Value on the date of delivery sufficient to satisfy such
minimum statutory obligations) prior to the delivery of any shares in respect of such Option or SAR. 
  

 - 25 - 

 (b) Restricted Stock. In the case of any shares of Restricted Stock that are
“substantially vested” (within the meaning of Treasury Regulations Section 1.83-3(b)) upon issuance, the Committee may require the Grantee to remit to the Company an amount sufficient to satisfy the federal, state or local withholding
and employment tax requirements (or make other arrangements satisfactory to the Company with regard to such taxes, including withholding from regular cash compensation, providing other security to the Company, or remitting or foregoing the receipt
of shares of Common having a Fair Market Value on the date of delivery sufficient to satisfy such minimum statutory obligations) prior to the issuance of any such shares. In the case of any shares of Restricted Stock that are not “substantially
vested” upon issuance, if the Committee determines that under applicable law and regulations the Company could be liable for the withholding of any federal or state tax with respect to such shares of Common Stock, the Committee may require the
Grantee to remit to the Company an amount sufficient to satisfy any such potential liability (or make other arrangements satisfactory to the Company with respect to such taxes, including withholding from regular cash compensation, providing other
security to the Company, or remitting or foregoing the receipt of shares of Common Stock having a Fair Market Value on the date of delivery sufficient to satisfy such obligations) at the time such shares of Restricted Stock are delivered to the
Grantee, at the time the Grantee makes an election under section 83(b) of the Code with respect to such shares of Restricted Stock and/or at the time such shares become “substantially vested,” and to agree to augment such security from
time to time in any amount reasonably deemed necessary by the Committee to preserve the adequacy of such security. 
 (c) Other
Awards. In the case of payment, whether in cash or shares of Common Stock, under any Award not specified in paragraphs (a) and (b) above, the Committee may require the Grantee to remit to the Company an amount sufficient to
satisfy the federal, state and local withholding and employment tax obligations of the Company with respect to such payments (or make other arrangements satisfactory to the Committee with regard to such taxes, including withholding from regular cash
compensation, providing other security to the Company, or remitting or foregoing the receipt of shares of Common Stock having a Fair Market Value on the date of delivery sufficient to satisfy such minimum statutory obligations) prior to the delivery
of any shares of Common Stock in respect of such Award, if any. 
 (d) Retention of Shares. With respect to any Grantee subject
to Section 16(a) of the Exchange Act, any retention of shares of Common Stock by the Company to satisfy a tax obligation with respect to such Grantee shall be made in compliance with any applicable requirements of Rule 16b-3(e) or any successor
rule under the Exchange Act. 
 (e) Offset Against Payments. The Company may, to the extent permitted by law, deduct any tax
obligations of a Grantee from any payment of any kind otherwise due to the Grantee hereunder. 
 12.11 Adjustments. Upon the happening
of any of the following described events, a Grantee’s rights with respect to Awards granted hereunder shall be adjusted as hereinafter provided, unless otherwise specifically provided in the Award Agreement. 
  

 - 26 - 

 (a) Stock Splits and Recapitalizations. In the event the Company issues any of its shares of
Common Stock as a stock dividend upon or with respect to the shares, or in the event shares of Common Stock shall be subdivided or combined into a greater or smaller number of shares, or if, upon a merger or consolidation, reorganization, split-up,
liquidation, combination, recapitalization or the like of the Company, shares of Common Stock shall be exchanged for other securities of the Company, securities of another entity, cash or other property, each Grantee upon exercising an Option (for
the purchase price to be paid under the Option) shall be entitled to purchase such number of shares, other securities of the Company, securities of such other entity, cash or other property as the Grantee would have received if the Grantee had been
the holder of the shares with respect to which the award is exercised at all times between the grant date of the Award and the date of its exercise, and appropriate adjustments shall be made in the purchase price per share. In determining whether
any Award granted hereunder has vested, appropriate adjustments will be made for distributions and transactions described in this Section 12.11(a). The Committee shall adjust the number of shares subject to outstanding awards and the exercise
price and the terms of outstanding awards to take into consideration material changes in accounting practices or principles, extraordinary dividends, acquisitions or dispositions of stock or property, or any other event if it is determined by the
Committee that such adjustment is appropriate to avoid distortion in the operation of the Plan, including adjustments of the limitations in Section 2.1 on the maximum number and kind of shares which may be issued. Where an adjustment of the
type described above is made to an Incentive Stock Option under this Section 12.11, the adjustment will be made in a manner which will not be considered a “modification” under the provisions of subsection 424(h)(3) of the Code.

 (b) Restricted Stock. If any person owning Restricted Stock receives new or additional or different shares or securities
(“New Securities”) in connection with a corporate transaction or stock dividend described in Section 12.11(a) as a result of owning such Restricted Stock, the New Securities shall be subject to all of the conditions and
restrictions applicable to the Restricted Stock with respect to which such New Securities were issued. Notwithstanding the foregoing, any adjustment under this Section 12.11(b) shall not be permitted to the extent that the individual award or
this Plan, in general, would constitute deferred compensation subject to section 409A of the Code unless the Award Agreement sets forth the terms and conditions necessary to comply with the requirements of section 409A of the Code. 
 (c) Fractional Shares. No fractional shares of Common Stock shall be issued under the Plan. Any fractional shares of Common Stock which, but for
this Section 12.11(c) would have been issued shall be deemed to have been issued and immediately sold to the Company for their Fair Market Value, and the Grantee shall receive from the Company cash in lieu of such fractional shares of Common
Stock. 
 (d) Further Adjustment. Upon the happening of any of the events described in Sections 12.11(a) or 12.11(b), the class and
aggregate number of shares set forth in Section 5.1 hereof that are subject to Awards which previously have been or subsequently may be granted under the Plan, and the number of shares set forth in Section 5.3 hereof that may be granted to
a Grantee in any year shall be appropriately adjusted to reflect the events described in such Sections. 
 (e) Assumption of Options Upon
Certain Events. In connection with a merger or consolidation of an entity with the Company or the acquisition by the Company of property or 
  

 - 27 - 

 stock of an entity, the Committee may grant awards under the Plan in substitution for stock and stock based awards issued
by such entity or a subsidiary thereof, as long as such substitute awards will not constitute a deferral of compensation under section 409A of the Code. Notwithstanding the foregoing, to the extent that the Committee determines that any such
substitute award shall constitute a deferral of compensation under section 409A of the Code, such award shall be accompanied with a written award agreement which shall set forth the terms and conditions required to comply with the requirements of
section 409A of the Code. The substitute awards shall be granted on such terms and conditions as the Committee considers appropriate in the circumstances. The awards so granted shall not reduce the number of shares that would otherwise be available
for awards under the Plan. Notwithstanding the foregoing, in the event of such a reorganization, merger, consolidation, recapitalization, reclassification, stock split-up, stock dividend or combination, or other adjustment or event which results in
shares of Common Stock being exchanged for or converted into cash, securities or other property, the Company will have the right, subject to applicable statutory and regulatory guidance, including but not limited to section 409A of the Code, to
terminate this Plan as of the date of the exchange or conversion, in which case all options, rights and other awards under this Plan shall become the right to receive such cash, securities or other property, net of any applicable exercise price.

 12.12 Other Transfer Restrictions. Notwithstanding any other provision of the Plan, in order to qualify for the exemption provided
by Rule 16b-3 under the Exchange Act, and any successor provision, (i) any Restricted Stock offered under the Plan to a Grantee subject to Section 16 of the Exchange Act (a “Section 16 Grantee”) may not be sold for six
(6) months after acquisition and (ii) any Option or other similar right related to an equity security issued under the Plan shall not be transferable except in accordance with the rules under Section 16 of the Exchange Act, subject to
any other applicable transfer restrictions under the Plan or the Award Agreement. The Committee shall have no authority to take any action if the authority to take such action, or the taking of such action, would disqualify a transaction under the
Plan from the exemption provided by Rule 16b-3 under the Act, or any successor provision. 
 12.13 Certain Indebtedness to the
Company. No Option or other Award may be exercised at any time after the Committee has determined, in good faith, that the Grantee is indebted to the Company or any Subsidiary for advances of salary, advances of expenses, recoverable draws or
other amounts unless and until either (a) such indebtedness is satisfied in full or (b) such condition is waived by the Committee. The period during which any Option or other Award may by its terms be exercised shall not be extended during
any period in which the Grantee is prohibited from such exercise by the preceding sentence, and the Company shall have no liability to any Grantee, or to any other party, if any Option or other Award expires unexercised in whole or in part during
such period or if any Option that is intended to be an Incentive Stock Option is deemed to be an Non-Qualified Option because such Option is not exercised within three (3) months after the Grantee’s Termination of Employment with the
Company or a Subsidiary. 
 12.14 Foreign Nationals. Awards may be made to Grantees who are foreign nationals or employed outside the
United States on such terms and conditions different from those specified in the Plan as the Committee considers necessary or advisable to achieve the purposes of the Plan or to comply with applicable laws. 
  

 - 28 - 

 12.15 No Right to Employment. No person shall have any claim or right to be granted an Award.
Neither the adoption, maintenance, nor operation of the Plan nor any Award hereunder shall confer upon any employee or consultant of the Company or of any Affiliate any right with respect to the continuance of his/her employment by or other service
with the Company or any such Affiliate nor shall they interfere with the rights of the Company (or Affiliate) to terminate any employee at any time or otherwise change the terms of employment, including, without limitation, the right to promote,
demote or otherwise re-assign any employee from one position to another within the Company or any Affiliate. 
 12.16 Authorization of Sub
Plans. The Board may from time to time establish one or more sub-plans under the Plan for purposes of satisfying applicable blue sky, securities or tax laws of various jurisdictions. The Board shall establish such sub-plans by adopting
supplements to this Plan containing (i) such limitations on the Board’s discretion under the Plan as the Board deems necessary or desirable or (ii) such additional terms and conditions not otherwise inconsistent with the Plan as the
Board shall deem necessary or desirable. All supplements adopted by the Board shall be deemed to be part of the Plan, but each supplement shall apply only to Grantees within the affected jurisdiction and the Company shall not be required to provide
copies of any supplement to Grantees in any jurisdiction which is not the subject of such supplement. 
 12.17 Severability. In the
event any provision of this Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of this Plan, and this Plan shall be construed and enforced as if the illegal or invalid provision
had not been included. 
 12.18 Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any shares of Common Stock hereunder, shall relieve the Company of any liability in respect of the failure to issue
or sell such shares of Common Stock as to which such requisite authority shall not have been obtained. 
 12. 19 Uncertificated
Shares. To the extent that this Plan provides for issuance of certificates to reflect the transfer of shares of Common Stock, the transfer of such shares of Common Stock may be effected on a noncertificated basis, to the extent not prohibited by
applicable law or the rules of any stock exchange. 
 12.20 Unfunded Plan. Grantees shall have no right, title, or interest whatsoever
in or to any investments that the Company, and/or its Subsidiaries, and/or its Affiliates may make to aid it in meeting its obligations under this Plan. Nothing contained in this Plan, and no action taken pursuant to its provisions, shall create or
be construed to create a trust of any kind, or a fiduciary relationship between the Company and any Grantee, beneficiary, legal representative, or any other individual. To the extent that any individual acquires a right to receive payments from the
Company, its Subsidiaries, and/or its Affiliates under this Plan, such right shall be no greater than the right of an unsecured general creditor of the Company, a Subsidiary, or an Affiliate, as the case may be. All payments to be made hereunder
shall be paid from the general funds of the Company, a Subsidiary, or an Affiliate, as the case may be and no special or separate fund shall be established and no segregation of assets shall be made to assure payment of such amounts except as
expressly set forth in this Plan. 
  

 - 29 - 

 12.21 No Constraint on Corporate Action. Nothing in this Plan shall be construed to:
(i) limit, impair, or otherwise affect the Company’s or a Subsidiary’s or an Affiliate’s right or power to make adjustments, reclassifications, reorganizations, or changes of its capital or business structure, or to merge or
consolidate, or dissolve, liquidate, sell, or transfer all or any part of its business or assets; or (ii) limit the right or power of the Company or a Subsidiary or an Affiliate to take any action which such entity deems to be necessary or
appropriate. 
 12.22 Special Provisions Relating to Section 409A of the Code. Unless otherwise indicated in the applicable Award
Agreement, it is not intended that any Award under this Plan, in form and/or operation, will constitute “deferred compensation” within the meaning of section 409A of the Code and therefore, each Award is intended to be exempt from the
requirements applicable to deferred compensation under section 409A of the Code and the regulations thereunder. 
 (a) Awards that are not
intended to constitute deferred compensation. With respect to an Award that is not intended to constitute deferred compensation within the meaning of Section 409A of the Code, (i) to the extent necessary and permitted under
Section 409A of the Code, the Company is authorized to amend this Plan or applicable Award Agreement or to substitute such Award with another Award of comparable economic value so that the Award as modified or substituted and/or the Plan as
modified, remains exempt from the requirements applicable to deferred compensation under section 409A of the Code and (ii) [the Committee shall take no action otherwise permitted under the Plan or under an Award Agreement to the extent such
action shall cause such Award to be treated as deferred compensation within the meaning of section 409A of the Code]. The Committee, in its sole discretion, shall determine to what extent, if any, this Plan or applicable Award Agreement shall be
required to be so modified or substituted. Notwithstanding any provision to the contrary, such modification or substitution shall be made without prior notice to or consent of Grantees. 
 (b) Awards that constitute deferred compensation. With respect to an Award that constitutes deferred compensation within the meaning of
Section 409A by form or operation (including, but not limited to, an Award referenced under paragraph (a) above that the Committee determines is a form of deferred compensation), (i) to the extent necessary the Company is authorized
to amend this Plan or applicable Award Agreement or to substitute such Award with another Award of comparable economic value so that the Award as modified or substituted and/or the Plan as modified, complies with the requirements applicable to
deferred compensation under section 409A of the Code and (ii) the Committee shall take no action otherwise permitted under the Plan or under an Award Agreement to the extent such action shall cause such Award to no longer comply with the
requirements applicable to deferred compensation under section 409A of the Code. The Committee, in its sole discretion, shall determine to what extent if any, this Plan or applicable Award Agreement shall be required to be so modified or
substituted. Notwithstanding any provision to the contrary, such modification or substitution shall be made without prior notice to or consent of Grantees. 
   *  *  * 
  

 - 30 - 

 I hereby certify that the foregoing Plan was duly adopted by the Board of Directors of NewStar Financial, Inc. on
                            . 
 Executed on this              day of
                     2006. 
  

	
	  

	                                      
                                        
      , Secretary

  

 - 31 -Stock Purchase Agreement, dated November 28, 2006

 EXHIBIT 10.1 
 EXECUTION VERSION 
 STOCK PURCHASE AGREEMENT 
 BY AND BETWEEN 
 DEGS BIOGAS, INC.

 AND 
 U.S. ENERGY
SYSTEMS, INC. 
 Dated as of November 28, 2006 

 TABLE OF CONTENTS 
  

			
	 	  	Pages
	ARTICLE I	  	
	 DEFINITIONS
	  	1
	 1.1 Definitions
	  	1
	 1.2 Rules of Construction
	  	5
	ARTICLE II	  	
	 SALE AND PURCHASE
	  	6
	 2.1 Sale and Purchase
	  	6
	 2.2 Consideration
	  	6
	ARTICLE III	  	
	 CLOSING
	  	6
	 3.1 Closing
	  	6
	 3.2 Deliveries by Seller
	  	7
	 3.3 Deliveries by Buyer
	  	7
	ARTICLE IV	  	
	 REPRESENTATIONS AND WARRANTIES OF SELLER
	  	8
	 4.1 Organization; Good Standing
	  	8
	 4.2 Authority Relative to Transaction Agreements
	  	8
	 4.3 No Violation; Consents.
	  	9
	 4.4 Capital Stock.
	  	9
	 4.5 Title to Class B Shares
	  	9
	 4.6 Litigation
	  	10
	 4.7 Brokers
	  	10
	 4.8 No Other Agreements.
	  	10
	ARTICLE V	  	
	 REPRESENTATIONS AND WARRANTIES OF BUYER
	  	10
	 5.1 Organization; Good Standing
	  	10
	 5.2 Authority Relative to Transaction Agreements
	  	10
	 5.3 No Violation; Consents.
	  	11
	 5.4 Litigation
	  	11
	 5.5 Brokers
	  	12
	 5.6 Financial Resources
	  	12
	 5.7 Purchase for Own Account
	  	12
	 5.8 ABB
	  	12
	ARTICLE VI	  	
	 CERTAIN COVENANTS
	  	12
	 6.1 Further Assurances
	  	12
	 6.2 Expenses.
	  	12
	 6.3 Books and Records; Access after Effective Date
	  	13
	 6.4 Public Statements
	  	13
	 6.5 Transfer of GASCOs
	  	13
	 6.6 GHG Sales.
	  	13

  

 i 

			
	 	  	Pages
	ARTICLE VII	  	
	 INDEMNIFICATION; LIMITATIONS
	  	14
	 7.1 No Reliance
	  	14
	 7.2 Indemnification.
	  	15
	 7.3 Defense of Claims; Insurance.
	  	16
	 7.4 No Set-Off
	  	18
	 7.5 No Consequential Damages; Sole Remedy.
	  	18
	 7.6 Survival
	  	18
	ARTICLE VIII	  	
	 MISCELLANEOUS PROVISIONS
	  	19
	 8.1 Amendment and Modification
	  	19
	 8.2 Waiver of Compliance; Consents
	  	19
	 8.3 Notices
	  	19
	 8.4 Binding Effect; Assignment
	  	20
	 8.5 Governing Law
	  	20
	 8.6 Consent to Jurisdiction; Waiver of Jury Trial.
	  	20
	 8.7 Counterparts
	  	20
	 8.8 Captions
	  	21
	 8.9 Schedules and Exhibits
	  	21
	 8.10 Entire Agreement
	  	21
	 8.11 Severability
	  	21
	 8.12 Relationship of Parties
	  	21
	 8.13 Third-Party Beneficiaries
	  	21
	 8.14 Joint Efforts
	  	21
	 8.15 Specific Performance
	  	21

  

 ii 

 INDEX TO SCHEDULES 
  

			
	 2.2
	  	Outstanding Obligations as of Effective Date
	 4.3
	  	Seller Consents and Approvals
	 5.3
	  	Buyer Consents and Approvals

  

 iii 

 INDEX TO EXHIBITS 
  

			
	 Exhibit
	  	 
	 A
	  	Conformed Copy of Fixed GASCO Note
	 B
	  	Conformed Copy of Contingent GASCO Note
	 C
	  	Eligible Projects
	 D
	  	Form of GASCO Assumption Agreement
	 E
	  	Form of GASCOs Bill of Sale and Assignment
	 F
	  	Form of Mutual Release

  

 iv 

 STOCK PURCHASE AGREEMENT 
 This STOCK PURCHASE AGREEMENT (this “Agreement”) is entered into as of November 28, 2006 (the “Effective Date”) by
and between DEGS Biogas, Inc. (formerly Cinergy Energy Solutions, Inc.), a Delaware corporation (“Seller”), and U.S. Energy Systems, Inc., a Delaware corporation (“Buyer”). Buyer and Seller are sometimes referred to
herein individually as a “Party” and collectively as the “Parties.” 
 WITNESSETH: 

WHEREAS, Seller owns 4,574 shares of the Class B Common Stock of U.S. Energy Biogas Corp., a Delaware corporation (the
“Company”), par value $.01 per share (the “Class B Shares”) and Buyer owns 5,426 shares of the Class A Common Stock of the Company, par value $.01 per share, which together with the Class B Shares represent all
of the authorized, issued and outstanding capital stock of the Company. 
 WHEREAS, Seller desires to sell to Buyer, and Buyer desires
to purchase from Seller, the Class B Shares pursuant to the terms of this Agreement; 
 NOW, THEREFORE, in consideration of the mutual
covenants, representations, warranties and agreements hereinafter set forth, and intending to be legally bound hereby, the Parties agree as follows: 
 ARTICLE I  
 DEFINITIONS 
 1.1 Definitions. As used in this Agreement, the following terms have the meanings specified in this Section 1.1: 
 “Affiliate” of a specified Person means any Person that directly or indirectly, through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified Person. As used in this definition of Affiliate, the term “control” of a specified Person, including, with correlative meanings, the terms “controlled
by” and “under common control with,” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract
or otherwise. 
 “ABB” means ABB Energy Capital, LLC, a Delaware limited liability company. 
 “AJG” means AJG Financial Services, Inc., a Delaware corporation. 
 “BMC” means BMC Energy LLC, a Delaware limited liability company. 
  

 1 

 “Business Day” means any day other than Saturday, Sunday and any day
that is a legal holiday in the State of New York or a day on which banking institutions in New York City are authorized by a Governmental Body or Legal Requirement to close. 
 “Buyer” has the meaning set forth in the introductory paragraph hereof. 
 “Buyer Consents and Approvals” has the meaning set forth in Section 5.3. 
 “Buyer Group” has the meaning set forth in Section 7.2. 
 “Buyer Parties” has the meaning set forth in Section 5.1. 
 “Class B Shares” has the meaning set forth in the recitals hereto. 
 “Closing” has the meaning set forth in Section 3.1. 
 “Contingent GASCO Note” means that certain promissory note in an original principal amount of $6,425,000 issued by DEGS
GASCO to AJG at the closing of the transactions contemplated by the GASCO Purchase Agreement, a copy of which promissory note is attached as Exhibit B. 
 “Code” means the Internal Revenue Code of 1986, as amended. 
 “Company” has the meaning set forth in the recitals hereto. 
 “Contract” means any
agreement, contract, indenture, mortgage, lease, sublease, license, sublicense, promissory note, guarantee, evidence of indebtedness or other similar arrangement or understanding, whether written or oral. 
 “DEGS GASCO” means DEGS GASCO, LLC (formerly Cinergy Gasco Solutions, LLC), a Delaware limited liability company.

 “DEGS HoldCo” means Duke Energy Generation Services Holding Company, Inc. (formerly Cinergy Solutions
Holding Company, Inc.), a Delaware corporation. 
 “Effective Date” has the meaning set forth in the
introductory paragraph hereof. 
 “Eligible Projects” means those projects listed on Exhibit D. 

“Encumbrance” means any charge, claim, community property interest, condition, equitable interest, lien, option,
pledge, mortgage, security interest, right of first refusal, restriction of any kind, including any restriction on use, voting, transfer, receipt of income or exercise of any other attribute of ownership or other adverse claims or encumbrances of
any kind. 
 “Fixed GASCO Note” means that certain promissory note in an original principal amount of
$2,900,236 issued by DEGS GASCO to AJG at the closing of the transactions contemplated by the GASCO Purchase Agreement, a copy of which promissory note is attached as Exhibit A. 
  

 2 

 “GASCO Assumption Agreement” means that certain Assignment, Assumption
and Consent Agreement, to be dated as of the Effective Date, by and among DEGS GASCO, DEGS HoldCo, Buyer, BMC, AJG and ABB, in substantially the form of Exhibit D. 
 “GASCOs Bill of Sale and Assignment” means that certain GASCOs Bill of Sale and Assignment Agreement to be entered into
by DEGS GASCO and Buyer promptly after January 1, 2008, in substantially the form of Exhibit E. 
 “GASCOs” means Countryside Landfill Gasco., L.L.C., a Delaware limited liability company; Morris Gasco, L.L.C., a Delaware limited liability company; and Brown County Landfill Gas Associates, L.P., a Delaware limited
partnership. 
 “GASCO Notes” means collectively the Contingent GASCO Note and the Fixed GASCO Note.

 “GASCO Purchase Agreement” means that certain GASCO Purchase and Sale Agreement by and between DEGS GASCO
and AJG, dated as of May 1, 2001. 
 “GHG Sale” means any sale of GHG Emission Credits pursuant to a
brokerage or similar agreement contemplated by Section 6.6. 
 “GHG Emission Credits” means all property
rights of any kind arising from the reduction, combustion or other destruction of certain carbon-based components of landfill gas, including methane, that have been determined to contribute to the greenhouse effect on the earth’s atmosphere
including, without limitation, (i) all monetary awards, regulatory relief, tax benefits (other than tax credits allowed by Section 45K) or other value provided by any statutory, regulatory or other program or scheme of any Governmental
Body and (ii) the market value relating to the sale, assignment or exchange of any official units or unofficial units of measurement of the benefits arising under any such program or scheme. 
 “Governmental Body” means any nation or government, any state, municipality or other political subdivision thereof, and
any entity exercising executive, legislative, judicial (including a public or private arbitrator), regulatory or administrative functions of or pertaining to government and any other governmental entity, instrumentality, agency, authority, board,
court, department, bureau or commission. 
 “Indemnifying Party” has the meaning set forth in
Section 7.2(c). 
 “Indemnitee” has the meaning set forth in Section 7.2(c). 
 “Knowledge” means actual knowledge of, with respect to Seller, G. Roger Daniel and, with respect to Buyer, Richard J.
Augustine. 
  

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 “Legal Requirement” means any order, writ, judgment, injunction, decree,
stipulation, determination or award of, or any constitution, law, ordinance, principle of common law, rule, directive (to the extent having the force of law), regulation, statute or treaty, as enacted, issued or promulgated by any Governmental Body,
including all amendments, modifications, extensions, replacements or re-enactments thereof, excluding the Tax laws unless specifically mentioned. 
 “Loss” has the meaning set forth in Section 7.2(a). 
 “Note
Purchase Agreement” means that certain Amendment to Note Purchase Agreement, dated as of April 8, 2004, among the Company, Countryside Canada Power Inc., the Guarantors (as defined therein), the BMC Parties (as defined therein) and the
Secured Party (as defined therein). 
 “Organizational Documents” means (i) with respect to any
corporation, its certificate or articles of incorporation or organization, as amended, and its by laws, as amended, (ii) with respect to any limited partnership, its certificate of limited partnership, as amended, and its partnership agreement,
as amended, (iii) with respect to any general partnership, its partnership agreement, as amended, and (iv) with respect to any limited liability company, its certificate of formation or articles of organization, as amended, and its
operating agreement, as amended. In the event any term or condition of this Agreement or any other Transaction Agreement requires any Organizational Document to be certified by a secretary of state or similar governmental official, the reference to
any such “Organizational Document” shall only be to a document of a type customarily certified by such governmental official. 
 “Party” and “Parties” have the meanings set forth in the introductory paragraph hereof. 
 “Payment” has the meaning set forth in Section 6.11 hereof. 
 “Permits” has the meaning set forth in Section 4.7(e) hereof. 
 “Permitted
Encumbrances” means Encumbrances with respect to the Class B Shares arising under the Stockholders’ Agreement, the Royalty Agreement and applicable federal and state securities or “blue sky” laws, including without limitation
the Securities Act of 1933. 
 “Person” means any individual, partnership, limited liability company,
corporation, cooperative, trust, estate, joint venture or any other legal entity, including a Governmental Body. 
 “Proceeding” has the meaning set forth in Section 4.6. 
 “Royalty Agreement”
means that certain Royalty Agreement, dated as of April 8, 2004, by and among the Company, Seller, Buyer and Countryside Canada Power, Inc., a Canadian corporation. 
  

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 “Section 45K” means Section 45K of the Code or the corresponding
provision of any future federal income tax law and means Section 29 of the Code as in effect prior to 2006 if the context requires. 
 “Seller” has the meaning set forth in the introductory paragraph hereof. 
 “Seller Consents and Approvals” has the meaning set forth in Section 4.3. 
 “Seller
Group” has the meaning set forth in Section 7.2(b). 
 “Seller Parties” has the meaning set
forth in Section 4.1 
 “Stockholders’ Agreement” means that certain Stockholders’ Agreement
dated as of November 28, 2000 by and among Seller, Buyer and the Company. 
 “Mutual Release” means that
certain Mutual Release, to be dated as of the Effective Date, by and between Seller and Buyer, in substantially the form of Exhibit F. 
 “Tax” (and, with correlative meaning, “Taxes” and “Taxable”) means: 
 (i) any federal, state, local or foreign net income, gross income, gross receipts, windfall profit, severance, property, production, sales, use, license, excise, franchise, net worth, employment, payroll withholding,
alternative or add-on minimum, ad valorem, transfer, stamp or environmental tax, or any other tax, custom, duty, levy, governmental fee or other like assessment or charge of any kind whatsoever, together with any interest or penalty, addition to tax
or additional amount imposed by any Governmental Body; and 
 (ii) any liability for the payment of amounts with respect to
payment of a type described in clause (i), including as a result of being a member of an affiliated, consolidated, combined or unitary group, as a result of succeeding to such liability as a result of merger, conversion or asset transfer or as a
result of any obligation under any Tax sharing arrangement or Tax indemnity agreement. 
 “Third Party Claim”
has the meaning set forth in Section 7.3(a). 
 “Transaction Agreements” means (i) this Agreement;
(ii) the GASCO Assumption Agreement; (iii) the Mutual Release; and (iv) the GASCOs Bill of Sale and Assignment. 
 1.2
Rules of Construction. All references in this Agreement to an “Article,” “Section,” “Exhibit” or “Schedule” are to an Article, Section, Exhibit or Schedule of this Agreement, unless the context
requires otherwise. Unless the context requires otherwise, the words “this Agreement,” “hereof,” “hereunder,” “herein,” “hereby” or words of similar import refer to this Agreement as a whole and not
to a particular Article, Section, subsection, clause or other subdivision hereof. Whenever the context requires, the words used herein include the masculine, feminine and neuter gender, and the singular and the plural. The words “include,”
“includes” and “including” mean “include, without limitation,” “includes, 
  

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 without limitation,” and “including, without limitation,” respectively. The word “or” has the
inclusive meaning represented by the phrase “and/or.” References to “this Agreement” or any other agreement or document shall be construed as a reference to such agreement or document, including any exhibits, appendices and
schedules thereto, as amended, modified or supplemented and in effect from time to time and shall include a reference to any document which amends, modifies or supplements it, or is entered into, made or given, pursuant to or in accordance with, its
terms. References to a Person shall be construed as a reference to such Person and its successors and permitted assigns. Time is of the essence in this Agreement. Currency amounts referenced herein are in U.S. Dollars unless otherwise specified.
Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified. 
 ARTICLE
II 
 SALE AND PURCHASE 
 2.1 Sale and Purchase. Subject to the terms and conditions of this Agreement and in exchange for the consideration described in Section 2.2, at the Closing, Seller shall sell, assign, convey, transfer and deliver to
Buyer, and Buyer shall purchase and acquire from Seller, all of Seller’s right, title and interest in and to the Class B Shares, free and clear of all Encumbrances, other than Permitted Encumbrances. 
 2.2 Consideration. As consideration for the sale of the Class B Shares, at the Closing, Buyer shall (a) assume any and all outstanding
payment obligations of DEGS GASCO that accrued prior to the Effective Date and any and all payment and other obligations of DEGS GASCO accruing on and after the Effective Date with respect to (i) the GASCO Notes and (ii) Section 2.5
of the GASCO Purchase Agreement, in each case in accordance with the GASCO Assumption Agreement and (b) enter into one or more brokerage or similar agreements with one or more brokers (each a “GHG Broker”) nominated by Seller
pursuant to Section 6.6 in connection with sales of GHG Emission Credits derived from the operation of the Eligible Projects for calendar years 2006 through and including 2010. Attached hereto as Schedule 2.2 is a good faith estimate jointly
prepared by the Parties of accrued and unpaid obligations with respect to the Notes and under Section 2.5 of the GASCO Purchase Agreement as of the Effective Date. The Parties acknowledge that Schedule 2.2 is provided for informational purposes
only and neither shall incur any liability as a result of any inaccuracy therein. 
 ARTICLE III 
 CLOSING 
 3.1 Closing.
Subject to the satisfaction or waiver of all conditions precedent set forth in this Article III, the closing with respect to the transfer of the Class B Shares (the “Closing”) shall occur on the Effective Date at the offices of
Hunton & Williams LLP, 52nd Floor, 200 Park Avenue, New York, N.Y. 10166, or at such other place as the
Parties may agree. 
  

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 3.2 Deliveries by Seller. As a condition precedent to Buyer’s obligations under this
Agreement, Seller shall deliver or cause to be delivered to Buyer the following: 
 (a) a certificate or certificates
representing the Class B Shares, duly endorsed in favor of Buyer or accompanied by a separate stock power duly executed by Seller and sufficient to vest in Buyer good title to the Class B Shares; 
 (b) executed copies of all Seller Consents and Approvals; 
 (c) satisfactory evidence of the resignation of G. Roger Daniel as a director of the Company; 
 (d) the GASCO Assumption Agreement, duly executed by DEGS GASCO and DEGS HoldCo; 
 (e) the Mutual Release, duly executed by Seller; 
 (f) an officer’s certificate of Seller, certifying (i) copies of the resolutions of Seller, duly adopted by Seller authorizing
the execution, delivery and performance of the transactions contemplated by this Agreement and the other Transaction Agreements to which Seller is a party; (ii) copies of Seller’s certificate of incorporation and bylaws; and (iii) the
incumbency of each of the officers of Seller who executes this Agreement and the other Transaction Agreements to which Seller is a party; 
 (g) a certificate of Duke Energy Generation Services, Inc., the sole member of DEGS GASCO, certifying (i) copies of the resolutions duly adopted by the sole member authorizing the execution, delivery and
performance of the transactions contemplated by the Transaction Agreements to which DEGS GASCO is a party; (ii) copies of DEGS GASCO’s certificate of formation and limited liability company operating agreement; and (iii) the
incumbency of each of the officers of DEGS GASCO who executes any Transaction Agreements to which DEGS GASCO is a party; 
 (h) an officer’s certificate of DEGS HoldCo, certifying (i) copies of the resolutions of DEGS HoldCo, duly adopted by DEGS HoldCo authorizing its execution, delivery and performance of the Transaction Agreements to which DEGS
HoldCo is a party; (ii) copies of DEGS HoldCo’s certificate of incorporation and bylaws; and (iii) the incumbency of each of the officers of DEGS HoldCo who executes any Transaction Agreement to which DEGS HoldCo is a party; and

 (i) a certificate of good standing for each of Seller, DEGS GASCO and DEGS HoldCo issued by the Secretary of State of the
State of Delaware and dated as of a date reasonably acceptable to Buyer. 
 3.3 Deliveries by Buyer. As a condition precedent
to Seller’s obligations under this Agreement, Buyer shall deliver or cause to be delivered to Seller the following: 
 (a) executed copies of all Buyer Consents and Approvals; 
  

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 (b) the GASCO Assumption Agreement, duly executed by Buyer and BMC; 
 (c) the Mutual Release, duly executed by Buyer; 
 (d) an officer’s certificate of Buyer, certifying (i) copies of the resolutions of Buyer, duly adopted by Buyer authorizing the
execution, delivery and performance of the transactions contemplated by this Agreement and the other Transaction Agreements to which Buyer is a party; (ii) copies of Buyer’s certificate of incorporation and bylaws; and (iii) the
incumbency of each of the officers of Buyer who executes this Agreement and the other Transaction Agreements to which Buyer is a party; 
 (e) a certificate of the manager of BMC certifying (i) copies of the written consent of the sole member of BMC authorizing the execution, delivery and performance of the transactions contemplated by the
Transaction Agreements to which BMC is a party; (ii) copies of BMC’s certificate of formation and limited liability company operating agreement; and (iii) the incumbency of the manager of BMC who executes any Transaction Agreements to
which BMC is a party; and 
 (f) a certificate of good standing for each of Buyer and BMC issued by the Secretary of State of
the State of Delaware and dated as of a date reasonably acceptable to Seller. 
 ARTICLE IV 
 REPRESENTATIONS AND WARRANTIES OF SELLER 
 Seller represents and warrants to Buyer as of the date hereof as follows: 
 4.1 Organization; Good Standing. Each of
Seller and DEGS HoldCo is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware. DEGS GASCO is a limited liability company duly formed, validly existing and in good standing under the laws of
the State of Delaware. Each of Seller, DEGS HoldCo and DEGS GASCO (collectively, the “Seller Parties”) has all requisite corporate or limited liability company power and authority to own and lease its properties and to carry on its
business and other activities as they are now conducted. 
 4.2 Authority Relative to Transaction Agreements. Each of the
Seller Parties has full corporate or limited liability company authority to execute, deliver and perform the Transaction Agreements to which it is a party, and to consummate the transactions contemplated hereby and thereby. The execution, delivery
and performance of the Transaction Agreements to which any Seller Party is a party and the consummation of the transactions contemplated hereby and thereby have been validly authorized by each Seller Party, as applicable, and no other corporate or
limited liability company action on the part of any Seller Party, or on the part of any shareholder or member thereof, is necessary to authorize the execution, delivery and performance of the Transaction Agreements to which any such Person is a
party or to consummate the transactions contemplated hereby or 
  

 8 

 thereby. The Transaction Agreements to which any Seller Party is a party have been (or in the case of the GASCOs Bill of
Sale and Assignment, when executed and delivered as contemplated herein, will be) duly and validly executed and delivered by each Seller Party that is a party thereto. Assuming the due execution and delivery thereof by the applicable Buyer Party (as
defined below), each of the Transaction Agreements to which any Seller Party is a party constitutes (or in the case of the GASCOs Bill of Sale and Assignment, when executed and delivered as contemplated herein, will constitute) such Seller
Party’s legal, valid and binding obligation, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency or other similar laws and general equitable principles. 
 4.3 No Violation; Consents. 
 (a) Neither the execution, delivery and performance by any Seller Party of the Transaction Agreements to which it is a party, nor the consummation of the transactions contemplated hereby and thereby, will
(i) conflict with or result in any breach of any provision of the Organizational Documents of any Seller Party ; (ii) violate, conflict with or constitute (with or without notice or lapse of time or both) a default or loss of any material
benefit under (or give rise to any right of termination, modification, cancellation or acceleration under) any of the terms, conditions or provisions of any material Contract or other instrument or obligation to which any Seller Party is a party or
by which any Seller Party or such Seller Party’s assets is bound (in each case, after giving effect to the Seller Consents and Approvals obtained as of the Closing); (iii) violate any Legal Requirement applicable to or affecting any Seller
Party or any of its assets or violate or give rise to any right of termination, modification or cancellation of any Permit applicable to or affecting any Seller Party or any of its assets; or (iv) result in the creation of any Encumbrance upon
the Class B Shares. 
 (b) No declaration, filing or registration with, or notice to, or authorization, waiver, consent or
approval of any Governmental Body or any other Person is required to be obtained by any Seller Party for the execution, delivery and performance by any Seller Party of the Transaction Agreements to which it is a party or for the consummation by it
of the transactions contemplated hereby and thereby, other than those which have been made or obtained on or before the date hereof and are in full force and effect and are identified on Schedule 4.3 (such declarations, filings, registrations,
notices, authorizations, waivers, consents and approvals, collectively, the “Seller Consents and Approvals”). 
 4.4
Capital Stock. The Class B Shares constitute all of Seller’s ownership interest in the Company. Seller has not transferred, sold, assigned, granted or disposed of in any manner whatsoever any beneficial or equity interest, right or
entitlement in the Company (including, without limitation, by way of an option, warrant or other right to acquire or right of first refusal), other than as expressly contemplated by this Agreement, the Stockholders’ Agreement and the Royalty
Agreement. 
 4.5 Title to Class B Shares. Seller is the sole legal and beneficial owner of the Class B Shares and has good,
valid and marketable title thereto, free and clear of any Encumbrances other than Permitted Encumbrances. Upon consummation of the Closing, valid and indefeasible title to the Class B Shares will pass to Buyer, free and clear of any Encumbrances
other than Permitted Encumbrances. 
  

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 4.6 Litigation. There is no pending or, to the Knowledge of Seller, threatened claim,
action, suit, proceeding, arbitration, investigation or hearing or notice of hearing in any court or by or before any Governmental Body (each, a “Proceeding”) involving Seller or any Affiliate thereof (other than the Company) which
would, if adversely decided, adversely affect the ability of Seller or any other Seller Party to execute and deliver this Agreement or any other Transaction Agreement to which any Seller Party is a party or to perform any of its obligations
hereunder or thereunder. Seller does not have Knowledge of any facts that could reasonably be expected to give rise to any such Proceeding. 
 4.7 Brokers. No agent, broker or other Person acting pursuant to the express or implied authority of Seller (or any Affiliate thereof other than the Company) is entitled to a commission or finder’s fee in connection with
the sale of the Class B Shares to Buyer hereunder. 
 4.8 No Other Agreements. There are no instruments, documents or
agreements relating to the Class B Shares, the GASCO Notes or the GASCOs to which any Seller Party is a party, by which any Seller Party is bound or under which a Seller Party is required to perform any obligations or is entitled to receive any
benefits in respect of the Class B Shares, the GASCO Notes or the GASCOs to which a Buyer Party or Affiliate thereof is not a party (including as an assignee or other transferee) or does not otherwise have or reasonably should be expected to have
knowledge of the material facts with respect thereto to the extent relevant to the transactions contemplated by this Agreement and the other Transaction Agreements. 
 ARTICLE V 
 REPRESENTATIONS AND WARRANTIES OF BUYER 
 Buyer represents and warrants to Seller as of the date hereof as follows: 
 5.1 Organization; Good Standing. Buyer is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware. BMC is a limited liability company duly formed,
validly existing and in good standing under the laws of the State of Delaware. Each of Buyer and BMC (collectively, the “Buyer Parties”) has all requisite corporate or limited liability company power and authority to own and lease
its properties and to carry on its business and other activities as they are now conducted. 
 5.2 Authority Relative to Transaction
Agreements. Each of the Buyer Parties has full corporate or limited liability company power and authority to execute, deliver and perform the Transaction Agreements to which it is a party, and to consummate the transactions contemplated
hereby and thereby. The execution, delivery and performance of the Transaction Agreements to which a Buyer Party is a party and the consummation of the transactions contemplated hereby and thereby have been duly and validly authorized by each

  

 10 

 Buyer Party, as applicable, and no other corporate or limited liability company proceedings on the part of any Buyer
Party or on the part of any shareholder or member thereof is necessary to authorize the execution, delivery and performance of the Transaction Agreements to which it is a party or to consummate the transactions contemplated hereby or thereby. The
Transaction Agreements to which any Buyer Party is a party have been (or in the case of the GASCOs Bill of Sale and Assignment, when executed and delivered as contemplated herein, will be) duly and validly executed and delivered by each Buyer Party
thereto. Assuming the due execution and delivery thereof by the applicable Seller Party, each of the Transaction Agreements to which a Buyer Party is a party constitutes (or in the case of the GASCOs Bill of Sale and Assignment, when executed and
delivered as contemplated herein, will constitute) such Party’s legal, valid and binding obligation, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency or other similar laws and general equitable
principles. 
 5.3 No Violation; Consents. 
 (a) Neither the execution, delivery and performance by any Buyer Party of the Transaction Agreements to which it is a party, nor the
consummation of the transactions contemplated hereby and thereby, will (i) conflict with or result in any breach of any provision of the Organizational Documents of any Buyer Party; (ii) violate, conflict with or constitute (with or
without notice or lapse of time or both) a default or loss of any material benefit under (or give rise to any right of termination, modification, cancellation or acceleration under) any of the terms, conditions or provisions of any material Contract
or other instrument or obligation to which a Buyer Party is a party or by which any Buyer Party or such Buyer Party’s assets is bound, including without limitation the Note Purchase Agreement, together with the other “Loan Documents”
as defined therein (in each case, after giving effect to the Buyer Consents and Approvals obtained as of the Closing); (iii) violate any Legal Requirement applicable to or affecting any Buyer Party or any of its assets or violate or give rise
to any right of termination, modification or cancellation of any Permit applicable to or affecting the Buyer Parties or any of their assets. 
 (b) No declaration, filing or registration with, or notice to, or authorization, waiver, consent or approval of any Governmental Body or any other Person is required to be obtained by any Buyer Party for the
execution, delivery and performance by any Buyer Party of the Transaction Agreements to which any Buyer Party is a party or the consummation by a Buyer Party of the transactions contemplated hereby or thereby, other than those which have been made
or obtained on or before the date hereof and are identified on Schedule 5.3 (such declarations, filings, registrations, notices, authorizations, waivers, consents and approvals, collectively, the “Buyer Consents and Approvals”).

 5.4 Litigation. There is no pending or, to the Knowledge of Buyer, threatened Proceeding involving Buyer or any Affiliate
thereof (including for the avoidance of doubt the Company) which would, if adversely decided, adversely affect the ability of Buyer or any other Buyer Party to execute and deliver this Agreement or any other Transaction Agreement to which any Buyer
Party is a party or to perform any of its obligations hereunder or thereunder. Buyer does not have Knowledge of any facts that could reasonably be expected to give rise to any such Proceeding. 
  

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 5.5 Brokers. No agent, broker or other Person acting pursuant to the express or implied
authority of Buyer (or any Affiliate of Buyer) is entitled to a commission or finder’s fee in connection with the acquisition of the Class B Shares by Buyer hereunder. 
 5.6 Financial Resources. Buyer has sufficient cash on hand or other financial resources to enable it to satisfy the payment obligations of
Buyer under this Agreement and the other Transaction Agreements in accordance with the terms hereof and thereof. 
 5.7 Purchase for
Own Account. The Class B Shares are being acquired by Buyer for investment purposes for Buyer’s own account, not as nominee or agent, and not with a view to the public resale or other distribution thereof in violation of the Securities
Act of 1933, as amended, Buyer has no present intention of selling or otherwise distributing the Class B Shares or any portion thereof. 
 5.8 ABB. Pursuant to the consummation of the transactions contemplated by the Note Purchase Agreement, DEGS GASCO is not obliged to make payments otherwise due to BMC under the Notes to ABB. 
 ARTICLE VI 
 CERTAIN COVENANTS

 6.1 Further Assurances. Each of the Parties agrees to take, or cause to be taken, all action, and to do, or cause to be
done, all things necessary, proper or advisable under applicable Legal Requirements to make effective the sale of the Class B Shares under this Agreement and to consummate the other transactions contemplated hereunder. From time to time after the
date of this Agreement, without further consideration, Seller shall, or shall cause its Affiliates to, at Seller’s own expense, execute and deliver such documents to Buyer as Buyer may reasonably request in order to more effectively vest in
Buyer all of Seller’s right, title and interest in and to the Class B Shares and otherwise to carry out the purposes of this Agreement and the transactions contemplated hereunder. From time to time after the date of this Agreement, Buyer shall
or shall cause its Affiliates to, at Buyer’s own expense, execute and deliver such documents to Seller as Seller may reasonably request in order to more effectively consummate the sale of the Class B Shares under this Agreement and otherwise to
carry out the purposes of this Agreement and the transactions contemplated hereunder. 
 6.2 Expenses. Except to the extent
otherwise set forth in this Agreement, each of Seller and Buyer shall bear its own expenses (including, without limitation, attorney’s fees) incurred in connection with the preparation, negotiation, execution and performance of this Agreement
and each other Transaction Agreement and the consummation of the transactions contemplated hereby and thereby. The foregoing notwithstanding, Buyer shall be responsible for any transfer, sales, stamp, documentary, use, filing, transfer and similar
taxes, fees, imposition or duty imposed by a Governmental Body that is payable as a result of the consummation of the transactions contemplated hereby. 
  

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 6.3 Books and Records; Access after Effective Date. Until December 31, 2010, each
Party shall have reasonable access to all of the records, books and documents of the other Party related to the Company to the extent that such access may reasonably be required in connection with any liabilities with respect to Taxes or for any
review by Seller of the determination of amounts paid or payable by Buyer pursuant to any brokerage or similar agreement entered into pursuant to Sections 2.2(b) and 6.6. Such access shall be afforded upon receipt of reasonable advance notice and
during normal business hours. Notwithstanding the foregoing, no Party shall have any right to inspect, and the other Party shall have no obligation to provide or cause its Affiliates to provide to the other Party access to, any books, records or
other information the disclosure of which would (i) jeopardize any privilege available to that Party or any such Affiliate, (ii) cause the other Party or any such Affiliate to breach a confidentiality obligation, or (iii) result in a
violation of law. The Party seeking access shall be solely responsible for any costs or expenses incurred by it pursuant to this Section 6.3. 
 6.4 Public Statements. The Parties (on behalf of themselves and any applicable Affiliates thereof) shall consult with each other before issuing any public announcement, statement or other disclosure with respect to the
Transaction Agreements and the transactions contemplated hereby or thereby and shall not issue any such public announcement, statement or other disclosure before such consultation, except as may be required by any Legal Requirement or by obligations
pursuant to any listing agreement with any national securities exchange. 
 6.5 Transfer of GASCOs. For full, good and valuable
consideration, the receipt and sufficiency of which Seller hereby acknowledges, promptly after January 1, 2008 but in any event not later than by January 31, 2008, Seller undertakes that DEGS GASCO shall, and shall cause DEGS GASCO to,
pursuant to the GASCOs Bill of Sale and Assignment, sell, assign, convey, transfer and deliver to Buyer or its designee, and Buyer shall or shall cause its designee to purchase and acquire from DEGS GASCO, for $10.00 all of DEGS GASCO’s right,
title and interest in and to the GASCOs. Seller undertakes that DEGS GASCO shall, and shall cause DEGS GASCO to, maintain its interests in the GASCOs and shall maintain or cause to be maintained, the GASCOS, in each case in a manner consistent with
its past practice in respect of the GASCOS. Seller undertakes that DEGS GASCO shall not, and shall cause DEGS GASCO not to, sell, assign, convey or otherwise transfer it interests in the GASCOs to any Person other than Buyer or its designee.

 6.6 GHG Sales. 
 (a) Seller shall use commercially reasonable efforts to identify, negotiate with, and nominate to Buyer one or more GHG brokers (each a “Broker”) and Buyer shall promptly enter into a brokerage or
similar agreement (each a “Brokerage Agreement”) pursuant to which Buyer shall appoint such Broker as its agent for the purpose of arranging and effecting sales of GHG Emission Credits derived from the operation of the Eligible
Projects for calendar years 2006 through and including 2010. 
  

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 Such Brokerage Agreement shall include customary provisions reasonably acceptable to Seller and Buyer,
including with respect to confidentiality, ownership of intellectual property, oversight of Broker by Buyer and duties and obligations of Broker. Buyer shall promptly provide Seller a copy of any Brokerage Agreement including any amendment thereto.
Buyer shall supply Seller and/or the Broker with such information as Seller or Broker reasonably requests and shall otherwise reasonably cooperate with Seller and Broker in connection with any GHG Sale. 
 (b) Buyer shall promptly reimburse Seller and Broker for all out of pocket documented costs and expenses reasonably incurred by Seller in
connection with any GHG Sale (collectively, “Reimbursable Costs”). 
 (c) Within 10 days after the receipt by
Buyer or any Affiliate thereof of the sale proceeds from any GHG Sale, Buyer shall pay to Seller an amount in immediately available funds equal to (i) 50% of such proceeds minus (ii) the amount of any Reimbursable Costs paid by or to be
paid on behalf of Buyer to Seller (each such net amount, the “Seller GHG Fee”); provided that Buyer shall have no obligation to pay to Seller, and Seller shall not be entitled to receive, any further Seller GHG Fee in respect of GHG
Sales if, and solely to the extent that, the aggregate amount of all Seller GHG Fees would otherwise exceed $6,000,000. 
 (d)
In the event that, prior to the earlier of (x) 2011 or (y) payment of Seller GHG Fees in an aggregate amount equal to $6,000,000, Buyer or any Affiliate thereof sells all or any portion of any Eligible Projects to any third-party not
affiliated with Buyer or any Affiliate thereof (whether the transaction is structured as an asset sale, sale of equity in, or merger or other reorganization transaction involving, an entity that owns directly or indirectly an interest in an Eligible
Project), Buyer shall not consummate any such transaction without notifying Seller of the pendency thereof and obtaining from such third-party an agreement in writing reasonably satisfactory to Seller assuming Buyer’s obligations under this
Section 6.6. 
 (e) Notwithstanding anything herein to the contrary, no GHG Sale may be consummated without the consent
of Buyer. 
 ARTICLE VII 
 INDEMNIFICATION; LIMITATIONS 
 7.1 No Reliance. Buyer, as the controlling shareholder of the Company, is
familiar with the Company and its assets, liabilities, operations, employees and financial prospects and enjoys complete and unrestricted access to the books and records and facilities and operations of the Company and its subsidiaries. In
connection with the execution and delivery of this Agreement and the other Transaction Agreements and the consummation of the transactions contemplated hereby and thereby, Neither Party has relied upon, and each Party expressly waives and releases
the other Party and its Affiliates and its and their directors, officers, employees and agents and other representatives from any and all liability 
  

 14 

 for any claims or losses relating to or arising from, any representation, warranty, statement, advice, document,
projection, or other information of any type provided by such other Party or any of its Affiliates or any of its or their directors, officers, employees and agents and other representatives, except, with respect to Seller, for those representations
and warranties of Seller Parties set forth in Article IV and, with respect to Buyer, for those representations and warranties of Buyer Parties set forth in Article V. In deciding to enter into this Agreement, and to consummate the transactions
contemplated hereby, each Party has relied solely upon its own knowledge, analysis and familiarity with the Company and its value (and that of its attorneys, accountants, consultants and representatives) and not on any disclosure or representation
made by the other Party or its Affiliates or any of its or their directors, officers, employees and agents and other representatives, other than the representations and warranties of Seller Parties and Buyer Parties set forth in Article IV and
Article V, respectively. Except, with respect to Seller, for those representations and warranties of Seller Parties set forth in Article IV and, with respect to Buyer, for those representations and warranties of Buyer Parties set forth in Article V,
neither Seller nor Buyer is making any representations or warranties, written or oral, statutory, express or implied, concerning the Class B Shares or otherwise in connection with the transactions contemplated by this Agreement and the other
Transaction Agreements. Without limitation of the foregoing, no Party has made, and each Party hereby expressly disclaims and negates, any representations or warranties to the other Party with respect to the Company and its operations, financial
condition, value, future earnings or prospects. 
 7.2 Indemnification. 
 (a) Subject to the limitations set forth in this Article VII, from and after the Closing, Seller shall indemnify, defend and hold harmless
Buyer and its Affiliates, and each of their respective directors, officers, members, shareholders, partners, agents and employees (collectively, the “Buyer Group”) from and against any and all actions, claims, demands, suits,
losses, liabilities, damages, obligations, payments, awards, assessments, judgments, settlements, compromises, costs and expenses (including costs and expenses of any Proceeding), in any case whether or not involving Third Party Claims (as defined
below), and reasonable attorneys fees and reasonable disbursements in connection therewith, together with costs and expenses of enforcing the indemnification provided hereunder (each, a “Loss”), asserted against or suffered by any
of them to the extent resulting from, arising out of or relating to, directly or indirectly, (i) any breach or failure to perform by any Seller Party of any of its covenants or agreements contained in this Agreement or any other Transaction
Agreement to which any Seller Party is a party; or (ii) any failure of any representations or warranties of any Seller Party made in this Agreement or any other Transaction Agreement to which any Seller Party is a party to be true and correct.

 (b) Subject to the provisions of this Article VII, from and after the Closing, Buyer shall indemnify, defend and hold
harmless Seller and its Affiliates, and each of their respective directors, officers, members, shareholders, partners, agents and employees (collectively, the “Seller Group”), from and against any and all Losses asserted against or
suffered by any of them to the extent resulting from or arising out of or with respect to, directly or indirectly, (i) any breach or failure to perform by any 
  

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 Buyer Party of any of its covenants or agreements contained in this Agreement or any other Transaction
Agreement to which any Buyer Party is a party; or (ii) any failure of any representations or warranties of any Buyer Party made in this Agreement or any other Transaction Agreement to which any Buyer Party is a party to be true and correct.

 (c) In no event shall any Party that is required to make any indemnification payment under this Article VII (an
“Indemnifying Party”) have any liability under Section 7.2(a) or Section 7.2(b) with respect to a covenant, agreement, representation or warranty unless, before the date specified in Section 7.6 for the expiration of
such covenant, agreement, representation or warranty, the Person seeking indemnification under this Article VII (the “Indemnitee”) provides the Indemnifying Party with notice in accordance with Section 7.3(a) of the claim or
event for which indemnification is sought with respect to such covenant, agreement, representation or warranty. 
 7.3 Defense of
Claims; Insurance. 
 (a) An Indemnitee shall give written notice to the Indemnifying Party of any claim with respect
to which it seeks indemnification promptly after the discovery by such Indemnitee of any matters giving rise to a claim for indemnification pursuant to Section 7.2 or promptly after any claim or demand is asserted against an Indemnitee by a
third party for which an Indemnifying Party would be liable hereunder; provided, however, that the failure of any Indemnitee to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this
Article VII except to the extent that the Indemnifying Party is actually prejudiced by such failure to give notice. In case any action, suit, claim, arbitration or other proceeding is brought by or before any Governmental Body against an Indemnitee
by a third party (a “Third Party Claim”), the Indemnifying Party shall be entitled to participate in or to assume the defense thereof, with counsel selected by the Indemnifying Party but reasonably satisfactory to the Indemnitee
and, after notice from the Indemnifying Party to the Indemnitee of its election to assume the defense thereof, the Indemnifying Party shall not be liable to such Indemnitee for any legal or other expenses subsequently incurred by the latter in
connection with the defense thereof; provided, however, that the Indemnifying Party shall pay the reasonable fees, costs and expenses of one separate counsel for the Indemnitees as a group (and shall pay such fees, costs and expenses
at least quarterly) in connection with such Third Party Claim if, but only if, (A) the Indemnifying Party has not acknowledged its obligation to fully indemnify the Indemnitee within thirty (30) days of receipt of the applicable
indemnification notice or (B) the Indemnitee shall have reasonably concluded that there may be a conflict of interest (including one or more legal defenses or counterclaims available to it or to other indemnified parties which conflict with
those available to the Indemnifying Party) that would make it inappropriate in the reasonable judgment of the Indemnitee (upon and in conformity with the advice of counsel) for the same counsel to represent both the Indemnitee and the Indemnifying
Party. The Indemnitee shall, at the expense of the Indemnifying Party, cooperate fully with the Indemnifying Party in connection with any negotiation or defense of any such Third Party Claim by the Indemnifying Party. In the event that (i) the
Indemnifying Party advises an Indemnitee that it will contest a claim for indemnification hereunder or 
  

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 (ii) the Indemnifying Party fails, within thirty (30) days of receipt of any indemnification notice
to notify, in writing, such Indemnitee of its election to defend, settle or compromise, at its sole cost and expense, any Third Party Claim (or discontinues its defense at any time after it commences such defense), then the Indemnitee may, at its
option, defend, settle or otherwise compromise or pay such Third Party Claim and the Indemnitee shall keep the Indemnifying Party apprised as to the status of the defense of any such Third Party Claim or settlement negotiations with respect thereto.
In any event, unless and until the Indemnifying Party elects in writing to assume and does so assume the defense of any such Third Party Claim in accordance with this Agreement, the Indemnifying Party shall be liable for the Indemnitee’s
reasonable costs and expenses arising out of the defense, settlement or compromise of any such Third Party Claim. The Indemnifying Party shall not be liable for any settlement of any Third Party Claim effected without its written consent;
provided, however, that the Indemnifying Party shall not unreasonably withhold its consent. Notwithstanding anything in this Section 7.3 to the contrary, the Indemnifying Party shall not, without the Indemnitee’s prior
written consent (whether or not the Indemnitee is a party), settle or compromise any claim or consent to entry of judgment in respect thereof which (x) imposes any financial or other obligation on the Indemnitee directly or indirectly for which
the Indemnitee does not simultaneously receive full indemnification, (y) does not include the giving by each claimant or the plaintiff, as applicable, to the Indemnitee of an unconditional release from all liability in respect of such action or
(z) provides any relief other than money damages. Notwithstanding anything to the contrary herein, the Indemnitee will have the right to employ separate counsel and participate at its own expense in the defense or investigation of such Third
Party Claim so long as such participation does not unreasonably interfere with the Indemnifying Party’s defense of the Third Party Claim. 
 (b) If the amount of any Loss, at any time after the making of an indemnity payment in respect thereof, is actually reduced by recovery, settlement or otherwise under any insurance coverage (excluding any proceeds
from self-insurance (including insurance by an Affiliate) or flow-through insurance policies), or under any claim, recovery, settlement or payment by or against any other Person, the amount of such reduction, less any costs, expenses,
deductibles or premiums incurred in connection therewith, must promptly be repaid by the Indemnitee to the Indemnifying Party; provided, however, that (x) if such recovery is subsequently returned to the insurer by reason of a
retroactive adjustment or other chargeback or reimbursement (other than as a credit to past or future insurance premiums or in connection with any matters not related to the claims arising out of or related to this Agreement or the Project
Agreements), then following written notice thereof from the Indemnitee to the Indemnifying Party specifying in reasonable detail the amount and circumstances of the adjustment, chargeback or reimbursement and attaching evidence from the insurance
carrier reasonably satisfactory to the Indemnifying Party, the Indemnifying Party shall repay to the Indemnitee the amount of such recovery which (1) was netted against the indemnity payment hereunder and (2) was actually paid by the
Indemnitee (or on its behalf by an Affiliate), as the case may be, to the insurer; and (y) the pendency of such payments shall not delay or reduce the obligation of the Indemnifying Party to make payment to the Indemnitee in respect of such
Loss (it being understood and agreed that 
  

 17 

 the Parties shall (subject to the penultimate sentence of this Section 7.3(b)) use commercially
reasonable efforts consistent with past practice to collect insurance proceeds payable with respect to matters that otherwise are indemnifiable under this Agreement). Nothing in this Section 7.3(b) will be construed to require any Party to
obtain or maintain any insurance coverage. Upon making any indemnity payment in respect of a Third Party Claim, the Indemnifying Party will, to the extent of such indemnity payment, be subrogated to all rights of the Indemnitee against any third
party in respect of the Loss to which the indemnity payment relates; provided, however, that (i) the Indemnifying Party must then be in compliance with all of its obligations under this Agreement and any other Transaction
Agreement to which the Indemnifying Party or any Affiliate thereof is a party in respect of such Loss and (ii) until the Indemnitee recovers full payment of its Loss, any and all claims of the Indemnifying Party against any such third party on
account of said indemnity payment are hereby made expressly subordinate and subject in right of payment to the Indemnitee’s rights against such third party. Without limiting the generality or effect of any other provision hereof, each such
Indemnitee and Indemnifying Party shall duly execute upon request all instruments reasonably necessary to evidence and perfect the above-described subrogation and subordination rights and otherwise use commercially reasonable efforts to cooperate in
the prosecution of such claims at the direction and expense of the Indemnifying Party. 
 7.4 No Set-Off. Neither Seller nor
Buyer shall have any right to set-off any indemnification obligations that either may have under Section 7.2 against any other obligations or amounts due to Seller or Buyer, as applicable, including, without limitation, under any other
provisions of this Agreement or under any other Transaction Agreement. 
 7.5 No Consequential Damages; Sole
Remedy. 
 (a) No Party (or its Affiliates) shall, under any circumstance, be liable to the other
Party (or its Affiliates) for any consequential, exemplary, special, incidental or punitive damages claimed by such other Party under the terms of or due to any breach of this Agreement or any other Transaction Agreement, including, but not limited
to, loss of revenue or income, cost of capital, or loss of business reputation or opportunity. 
 (b) Subject to
Section 8.15, the indemnification provisions of this Article VII shall be the sole and exclusive right and remedy of each Party (including the Seller Group and the Buyer Group) (i) for any breach of the other Party’s representations,
warranties, covenants, or agreements contained in this Agreement or any other Transaction Agreement or (ii) otherwise with respect to this Agreement and the transactions contemplated hereby. Except as provided in the prior sentence, from and
after Closing, no Party (including the Seller Group and the Buyer Group) will have any other remedy (statutory, equitable, common law or otherwise) against any other Party with respect to such matters, and all such other remedies are hereby waived.

 7.6 Survival. The representations and warranties contained in this Agreement shall survive the Closing for twelve
(12) months. The covenants and agreements of the Parties set forth in this Agreement which are not to be fully performed on the Effective Date shall survive the Closing until fully performed or fulfilled, unless non-compliance with such
covenants or agreements is waived in writing by the Party entitled to such performance. 
  

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 ARTICLE VIII 
 MISCELLANEOUS PROVISIONS 
 8.1 Amendment and Modification. This Agreement may be
amended, modified or supplemented only by a written agreement executed by the Parties hereto. 
 8.2 Waiver of Compliance;
Consents. No failure of any of the Parties to comply with any obligation, covenant, agreement or condition herein may be waived by the Party entitled to the benefits thereof except by a written instrument signed by the Party granting such
waiver, but such waiver or failure to insist upon strict compliance with such obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure. 
 8.3 Notices. All notices and other communications under this Agreement must be in writing and delivered (a) in person, (b) by
registered or certified mail with postage prepaid and return receipt requested, (c) by nationally recognized overnight courier service with charges prepaid, or (d) by facsimile transmission, in each case directed to the intended recipient
as follows: 
 If to Seller, at: 
 DEGS Biogas, Inc. 
 139 East Fourth Street 
 Cincinnati, Ohio 45201 
 Facsimile Number: (980) 373-6034 
 Attention: Wouter van Kempen 
 With a copy to: 
 Duke Energy Americas, LLC 
 5400 Westheimer Court 
 Houston, TX 77056-5310 
 Phone: 713-627-5781 
 Facsimile: 713-386-4087 
 Attention: Group Vice President & General Counsel 
 If to Buyer, at: 
 U.S. Energy Systems, Inc. 
 750 Lexington Avenue, 15th Floor 
 New York, NY 10022 
 Phone: 212-588-8901 
 Facsimile Number: 212-588-1635 
 Attention: Chief Executive Officer 
  

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 A Party may change the address to which notices and other communications hereunder can be
delivered by giving the other Parties notice in the manner herein set forth. A notice or other communication will be deemed delivered on the earliest to occur of (i) its actual receipt when delivered in person; (ii) the fifth
(5th) Business Day following its deposit in registered or certified mail, with postage prepaid, and return
receipt requested; (iii) the second (2nd) Business Day following its deposit with a recognized overnight
courier service; or (iv) the date of receipt of a facsimile or, if such date of receipt is not a Business Day, the next Business Day following such date of receipt, provided the sender can and does provide evidence of successful
transmission. 
 8.4 Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the Parties
and their respective successors and permitted assigns. Neither this Agreement nor any of the rights, interests or obligations hereunder may be assigned by a Party without the prior written consent of the other Party, which it may grant or withhold
in its sole discretion. 
 8.5 Governing Law. This Agreement, and all matters arising hereunder or in connection herewith,
shall be governed by, and construed in accordance with, the laws of the State of Delaware applicable to contracts executed and performed entirely in the State of Delaware. 
 8.6 Consent to Jurisdiction; Waiver of Jury Trial. 
 (a) THE PARTIES AGREE AND CONSENT TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF DELAWARE AND (IF IT HAS SUBJECT MATTER
JURISDICTION) THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE, IN ANY SUIT, ACTION OR PROCEEDING SEEKING TO ENFORCE ANY PROVISION OF, OR BASED ON ANY MATTER ARISING OUT OF OR IN CONNECTION WITH, THIS AGREEMENT, AND AGREE NOT TO BRING
ANY SUIT, ACTION OR PROCEEDING IN ANY OTHER FORUM OR TRIBUNAL EXCEPT WHERE APPROPRIATE TO ENFORCE THE AWARD OF SUCH A COURT. EACH PARTY HEREBY IRREVOCABLY CONSENTS TO THE SERVICE OF ANY AND ALL PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
REGISTERED OR CERTIFIED MAIL ADDRESSED AND SENT TO THE NOTICE ADDRESS SET FORTH IN SECTION 8.3. 
 (b) EACH PARTY HEREBY
WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING RELATING TO THIS AGREEMENT. 
 8.7
Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. A facsimile transmission of this Agreement
bearing a signature on behalf of a Party will be legal and binding on such Party. 
  

 20 

 8.8 Captions. The article and section headings contained in this Agreement are solely for
the purpose of reference, are not part of the agreement of the Parties and shall not in any way affect the meaning or interpretation of this Agreement. 
 8.9 Schedules and Exhibits. All exhibits and schedules referred to herein are intended to be and hereby are specifically made a part of this Agreement. 
 8.10 Entire Agreement. This Agreement and the other Transaction Agreements constitute the entire agreement of the Parties relating to the
subject matter of this Agreement and the other Transaction Agreements and supersede all prior or contemporaneous agreements and undertakings, oral or written, among the Parties with respect to the subject matter hereof or thereof. 
 8.11 Severability. Each provision of this Agreement shall be considered severable and, if for any reason any provision hereof is determined
to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not impair the operation or affect those portions of this Agreement which are valid, any such invalid, illegal or unenforceable provision
shall be reformed to the minimum extent required to be enforceable and to give effect to the original written intent of the Parties and this Agreement shall remain in full force and effect and shall be construed and enforced in all respects.

 8.12 Relationship of Parties. Nothing contained in this Agreement shall, or shall be deemed to, constitute a partnership or
joint venture between Seller and Buyer. 
 8.13 Third-Party Beneficiaries. Nothing in this Agreement shall be construed as
giving any Person any right, remedy or claim under or in respect of this Agreement or any provision hereof, other than the Parties and their successors and permitted assigns, DEGS GASCO and, solely with respect to Article VII, the Indemnitees.

 8.14 Joint Efforts. Each Party acknowledges that it and its attorneys have been given an equal opportunity to negotiate the
terms and conditions of this Agreement and that any rule of construction to the effect that ambiguities are to be resolved against the drafting Party or any similar rule operating against the drafter of an agreement shall not be applicable to the
construction or interpretation of this Agreement. 
 8.15 Specific Performance. The Parties agree that irreparable damage will
result if this Agreement is not performed in accordance with its terms, and the Parties agree that any damages available at law for a breach of this Agreement would not be an adequate remedy. Therefore, the provisions hereof shall be enforceable in
a court of equity, or other tribunal with jurisdiction, by a decree of specific performance, and appropriate injunctive relief may be applied for and granted in connection therewith. Such remedies and all other remedies provided for in this
Agreement shall, however, be cumulative and not exclusive and shall be in addition to any other remedies that a Party may have under this Agreement, at law or in equity. 
 [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 
  

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 IN WITNESS WHEREOF, each of the Parties has caused this Stock Purchase Agreement to be signed by its duly
authorized officer as of the date first above written. 
  

			
	DEGS BIOGAS, INC.
		
	By:	 	  
	Name:	 	
	Title:	 	

  

			
	U.S. ENERGY SYSTEMS, INC.
		
	By:	 	  
	Name:	 	
	Title:	 	

  

 22

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