Document:

TRANSWITCH CORPORATION

2008 EQUITY INCENTIVE PLAN

 

 

 

1.  Purpose and Eligibility.  The
purpose of this 2008 Equity Incentive Plan (the “Plan”) of TranSwitch Corporation, a Delaware corporation
(the “Company”), is to provide stock options, stock issuances and other equity interests in the Company (each,
an “Award”) to (a) employees, officers, directors, consultants and advisors of the Company and its Subsidiaries
or any future parent corporation, and (b) any other person who is determined by the Board to have made (or is expected to make)
contributions to the Company.  Any person to whom an Award has been granted under the Plan is called a “Participant.”  Additional
definitions are contained in Section 10.

 

2.  Administration.

 

a.  Administration by Board
of Directors.  The Plan will be administered by the Board of Directors of the Company (the “Board”).  The
Board, in its sole discretion, shall have the authority to grant and amend Awards, to adopt, amend and repeal rules relating to
the Plan and to interpret and correct the provisions of the Plan and any Award.  The Board shall have authority, subject
to the express limitations of the Plan, (i) to construe and determine the respective Stock Option Agreement (as defined below),
Awards and the Plan, (ii) to prescribe, amend and rescind rules and regulations relating to the Plan and any Awards, (iii) to
determine the terms and provisions of the respective Stock Option Agreements and Awards, which need not be identical, (iv) to create
sub-plans hereunder necessary to comply with laws and regulations of any foreign country in which the Company may seek to grant
an Award to a person eligible under Section 1, and (v) to make all other determinations in the judgment of the Board
of Directors necessary or desirable for the administration and interpretation of the Plan.  The Board may correct any
defect or supply any omission or reconcile any inconsistency in the Plan or in any Stock Option Agreement or Award in the manner
and to the extent it shall deem expedient to carry the Plan, any Stock Option Agreement or Award into effect and it shall be the
sole and final judge of such expediency.  All decisions by the Board shall be final and binding on all interested persons.  Neither
the Company nor any member of the Board shall be liable for any action or determination relating to the Plan.

 

b.  Appointment of Committee.  To
the extent permitted by applicable law, the Board may delegate any or all of its powers under the Plan to one or more committees
or subcommittees of the Board (a “Committee”).  If so delegated, all references in the Plan to the
“Board” shall mean such Committee or the Board.

 

c.  Delegation to Executive
Officers.  To the extent permitted by applicable law, the Board may delegate to one or more executive officers of
the Company the power to grant Awards and exercise such other powers under the Plan as the Board may determine, provided that the
Board shall fix the maximum number of Awards to be granted and the maximum number of shares issuable to any one Participant pursuant
to Awards granted by such executive officers.

 

d.  Applicability of Section
Rule 16b-3.  Notwithstanding anything to the contrary in the foregoing if, or at such time as, the Common Stock is
or becomes registered under Section 12 of the Exchange Act of 1934, as amended (the “Exchange Act”), or any
successor statute, the Plan shall be administered in a manner consistent with Rule 16b-3 promulgated thereunder, as it may be amended
from time to time, or any successor rules (“Rule 16b-3”), such that all subsequent grants of Awards hereunder
to Reporting Persons, as hereinafter defined, shall be exempt under such rule.  Those provisions of the Plan which make
express reference to Rule 16b-3 or which are required in order for certain option transactions to qualify for exemption under Rule
16b-3 shall apply only to such persons as are required to file reports under Section 16 (a) of the Exchange Act (a “Reporting
Person”).

 

3.  Stock Available for Awards.

 

a.  Number of Shares.  Subject
to adjustment under Section 3(c), the (i) aggregate number of shares of Common Stock of the Company (the “Common
Stock”) that may be issued pursuant to the Plan is 7,196,250 (the “Available Shares”).  If
an Award granted under the Plan is (i) canceled, expires, forfeited, is settled in cash, settled by delivery of fewer shares of
Common Stock than the number of shares of Common Stock underlying the award or option or otherwise is terminated without delivery
of the shares of Common Stock to the holder of such award or option or (ii) shares that were withheld from such an Award or separately
surrendered by the Participant in payment of an exercise price or taxes relating to such an Award shall be deemed to constitute
shares not delivered and will be available under the Plan for subsequent awards.

 

    	 

    	 

    
 

b.  Per-Participant Limit.  Subject
to adjustment under Section 3(c), no Participant may be granted Awards during any one fiscal year to receive, acquire or
purchase more than 375,000 shares of Common Stock.

 

c.  Adjustment to Common Stock.  Subject
to Section 8, in the event of any stock split, reverse stock split, stock dividend, extraordinary cash dividend, recapitalization,
reorganization, merger, consolidation, combination, exchange of shares, liquidation, spin-off, split-up, or other similar change
in capitalization or similar event, (i) the number and class of Available Shares and the per-Participant share limit, (ii) the
number and class of securities, vesting schedule and exercise price per share subject to each outstanding Option (as defined below),
(iii) the repurchase price per security subject to repurchase, and (iv) the terms of each other outstanding Award shall be adjusted
by the Company (or substituted Awards may be made if applicable) to the extent the Board shall determine, in good faith, that such
an adjustment (or substitution) is appropriate.  Any such adjustment to outstanding Awards will be effected in a manner
that precludes the enlargement of rights and benefits under such Awards.

 

4.  Stock Options.

 

a.  General.   The
Board may grant options to purchase Common Stock (each, an “Option”) and determine the number of shares of Common
Stock to be covered by each Option, the exercise price of each Option and the conditions and limitations applicable to the exercise
of each Option and the shares of Common Stock issued upon the exercise of each Option, including, but not limited to, vesting provisions,
repurchase provisions and restrictions relating to applicable federal or state securities laws.  Each Option will be
evidenced by a Stock Option Agreement, consisting of a Notice of Stock Option Award and a Stock Option Award Agreement  or
such other form of documentation as may be approved by the Board (collectively, a “Stock Option Agreement”).

 

b.  Incentive Stock Options.  An
Option that the Board intends to be an incentive stock option (an “Incentive Stock Option”) as defined in Section
422 of the Code, as amended, or any successor statute (“Section 422”), shall be granted only to an employee
of the Company and shall be subject to and shall be construed consistently with the requirements of Section 422 and regulations
thereunder.  The Board and the Company shall have no liability if an Option or any part thereof that is intended to be
an Incentive Stock Option does not qualify as such.  An Option or any part thereof that does not qualify as an Incentive
Stock Option is referred to herein as a “Nonstatutory Stock Option” or “Nonqualified Stock Option.”

 

c.  Dollar Limitation.  For
so long as the Code shall so provide, Options granted to any employee under the Plan (and any other incentive stock option plans
of the Company) which are intended to qualify as Incentive Stock Options shall not qualify as Incentive Stock Options to the extent
that such Options, in the aggregate, become exercisable for the first time in any one calendar year for shares of Common Stock
with an aggregate Fair Market Value (as defined below) (determined as of the respective date or dates of grant) of more than $100,000.  The
amount of Incentive Stock Options which exceed such $100,000 limitation shall be deemed to be Nonqualified Stock Options.  For
the purpose of this limitation, unless otherwise required by the Code or regulations of the Internal Revenue Service or determined
by the Board, Options shall be taken into account in the order granted, and the Board may designate that portion of any Incentive
Stock Option that shall be treated as Nonqualified Option in the event that the provisions of this paragraph apply to a portion
of any Option.  The designation described in the preceding sentence may be made at such time as the Committee considers
appropriate, including after the issuance of the Option or at the time of its exercise.

 

d.  Exercise Price.  The
Board shall establish the exercise price (or determine the method by which the exercise price shall be determined) at the time
each Option is granted and specify the exercise price in the applicable Stock Option Agreement, provided, however, in no event
may the per share exercise price of an Incentive Stock Option be less than 100% of the Fair Market Value of the Common Stock on
the date such Option is granted.  In the case of an Incentive Stock Option granted to a Participant who, at the time
of grant of such Option, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the
Company or any Subsidiary or future parent corporation, then the exercise price shall be no less than 110% of the Fair Market Value
of the Common Stock on the date of grant.  The Board in its sole and absolute discretion may, with the consent of the
Recipient, if applicable, and subject to compliance with any legal, regulatory or other administrative requirements applicable
to the Plan  amend or adjust the terms and conditions of any Award, at any time or from time to time, including, but
not limited to, to either (1) reduce the exercise price of an outstanding Option or other Award or (2) simultaneously cancel Options
for which the exercise price exceeds the then current Fair Market Value of the underlying Common Stock and grant a new Award with
an exercise price equal to or greater than the then current Fair Market Value of the underlying Common Stock.

 

    	 

    	 

    
 

e.  Duration of Options.  Each
Option shall be exercisable at such times and subject to such terms and conditions as the Board may specify in the applicable Stock
Option Agreement; provided, that the term of any Incentive Stock Option may not be more than ten (10) years from the date of grant.  In
the case of an Incentive Stock Option granted to a Participant who, at the time of grant of such Option, owns stock representing
more than ten percent (10%) of the voting power of all classes of stock of the Company or any Subsidiary or future parent corporation,
the term of the Option shall be no longer than five (5) years from the date of grant.

 

f.  Payment Upon Exercise.  Common
Stock purchased upon the exercise of an Option shall be paid for by one or any combination of the following forms of payment as
permitted by the Board in its sole and absolute discretion:

 

i.  by check payable to the order
of the Company;

 

ii.  only if the Common Stock is
then publicly traded, by delivery of an irrevocable and unconditional undertaking by a creditworthy broker to deliver promptly
to the Company sufficient funds to pay the exercise price, or delivery by the Participant to the Company of a copy of irrevocable
and unconditional instructions to a creditworthy broker  to deliver promptly to the Company cash or a check sufficient
to pay the exercise price;

 

iii.  to the extent permitted in
the applicable Stock Option Agreement, by delivery of shares of Common Stock owned by the Participant; or

 

iv.  payment of such other lawful
consideration as the Board may determine.

 

Except as otherwise expressly set forth in a Stock Option Agreement,
the Board shall have no obligation to accept consideration other than cash.  The fair market value of any shares of the
Company's Common Stock or other non-cash consideration which may be delivered upon exercise of an Option shall be determined in
such manner as may be prescribed by the Board.

 

g.  Determination of Fair Market
Value.  If, at the time an Option is granted under the Plan, the Company's Common Stock is publicly traded under
the Exchange Act, “Fair Market Value” shall mean (i) if the Common Stock is listed on any established stock
exchange, its fair market value shall be the closing price for such stock on that date or the closing price as reported on NASDAQ;
or (ii) if the Common Stock is traded in the over-the-counter securities market, then the average of the high bid and low bid quotations
for the Common Stock as published in The Wall Street Journal.  In the absence of an established market for the
Common Stock, the fair market value thereof shall be determined in good faith by the Board after taking into consideration all
factors which it deems appropriate.

 

5.  Restricted Stock.

 

a.  Grants.  The
Board may (i) grant Awards to a Participant of restricted shares of Common Stock and shall determine the price, if any, to be paid
by the Participant for each restricted share of Common Stock and (ii) shall provide the right of the Company to repurchase all
or part of such shares at the issue price or other stated or formula price from the Participant in the event that the conditions
specified by the Board in the applicable Award are not satisfied prior to the end of the applicable restriction period or periods
established by the Board for such Award (each, a “Restricted Stock Award”).

b.  Terms and Conditions.  The
Board shall determine the terms and conditions of any such Restricted Stock Award.  Any stock certificates issued in
respect of a Restricted Stock Award shall be registered in the name of the Participant and, unless otherwise determined by the
Board, deposited by the Participant, together with a stock power endorsed in blank, with the Company (or its designee).  After
the expiration of the applicable restriction periods, the Company (or such designee) shall deliver the certificates no longer subject
to such restrictions to the Participant or, if the Participant has died, to the beneficiary designated by a Participant, in a manner
determined by the Board, to receive amounts due or exercise rights of the Participant in the event of the Participant's death (the
“Designated Beneficiary”).  In the absence of an effective designation by a Participant, Designated
Beneficiary shall mean the Participant's estate.

 

    	 

    	 

    
 

6.  Other Stock-Based Awards.  The
Board shall have the right to grant other Awards based upon the Common Stock having such terms and conditions as the Board may
determine, including, without limitation, the grant of shares based upon certain conditions, the grant of securities convertible
into Common Stock and the grant of stock appreciation rights, phantom stock awards, performance stock, deferred stock, restricted
stock units, shares of Common Stock not subject to any restrictions or stock units.

 

7.  General Provisions Applicable to Awards.

 

a.  Transferability of Awards.  Except
as the Board may otherwise determine or provide in an Award, Awards shall not be sold, assigned, transferred, pledged or otherwise
encumbered by the person to whom they are granted, either voluntarily or by operation of law, except by will or the laws of descent
and distribution, and, during the life of the Participant, shall be exercisable only by the Participant; provided, however, except
as the Board may otherwise determine or provide in an Award, other than an Incentive Stock Option, may be transferred pursuant
to a qualified domestic relations order (as defined in Employee Retirement Income Security Act of 1974, as amended) or to a grantor-retained
annuity trust or a similar estate-planning vehicle in which the trust is bound by all provisions of the Stock Option Agreement
and Restricted Stock Award, which are applicable to the Participant.  References to a Participant, to the extent relevant
in the context, shall include references to authorized transferees.

 

b.  Documentation.  Each
Award under the Plan shall be evidenced by a written instrument in such form as the Board shall determine or as executed by an
officer of the Company pursuant to authority delegated by the Board.  Each Award may contain terms and conditions in
addition to those set forth in the Plan, provided that such terms and conditions do not contravene the provisions of the Plan or
applicable law.  Notice of a grant shall be given to each Participant to whom an Award is so granted within a reasonable
time after the determination has been made.

 

c.  Board Discretion.  The
terms of each type of Award need not be identical, and the Board need not treat Participants uniformly.

 

d.  Additional Award Provisions.  The
Board may, in its sole discretion, include additional provisions in any Stock Option Agreement, Restricted Stock Award or other
Award granted under the Plan, including without limitation restrictions on transfer, repurchase rights, commitments to pay cash
bonuses, to make, arrange for or guaranty loans or to transfer other property to Participants upon exercise of Awards, or transfer
other property to Participants upon exercise of Awards, or such other provisions as shall be determined by the Board; provided
that such additional provisions shall not be inconsistent with any other term or condition of the Plan or applicable law.

 

e.  Termination of Status.  The
Board shall determine the effect on an Award of the disability (as defined in Code Section 22(e)(3)), death, retirement, authorized
leave of absence or other change in the employment or other status of a Participant and the extent to which, and the period during
which, the Participant, or the Participant's legal representative, conservator, guardian or Designated Beneficiary, may exercise
rights under the Award, subject to applicable law and the provisions of the Code related to Incentive Stock Options.

 

f.  Change of Control of the
Company.

 

i.  Unless otherwise expressly provided
in the applicable Stock Option Agreement or Restricted Stock Award or other Award, in connection with the occurrence of a Change
in Control (as defined below), the Board shall, in its sole discretion as to any outstanding Award (including any portion thereof;
on the same basis or on different bases, as the Board shall specify), take one or any combination of the following actions:

 

A.  make appropriate provision
for the continuation of such Award by the Company or the assumption of such Award by the surviving or acquiring entity and by substituting
on an equitable basis for the shares then subject to such Award either (x) the consideration payable with respect to the outstanding
shares of Common Stock in connection with the Change of Control, (y) shares of stock of the surviving or acquiring corporation,
or (z) such other securities as the Board deems appropriate, the Fair Market Value of which shall not materially differ from the
Fair Market Value of the shares of Common Stock subject to such Award immediately preceding the Change of Control (as determined
by the Board in its sole discretion;

 

    	 

    	 

    
 

B.  accelerate the date of exercise
or vesting of such Award;

 

C.  permit the exchange of such
Award for the right to participate in any stock option or other employee benefit plan of any successor corporation;

 

D.  provide for the repurchase
of the Award for an amount equal to the difference of (i) the consideration received per share for the securities underlying the
Award in the Change of Control minus (ii) the per share exercise price of such securities.  Such amount shall be payable
in cash or the property payable in respect of such securities in connection with the Change of Control.  The value of
any such property shall be determined by the Board in its discretion; or

 

E.  Solely with respect to a transaction
described in Section 7(f)(i)(F)(a) below, provide for the termination of such Award immediately prior to the consummation
of the Change of Control; provided that no such termination shall be effective unless the option holder is provided at least fifteen
(15) business days prior to the consummation of the Change of Control to exercise his/her options.

 

F.  For the purpose of this Agreement,
a “Change of Control” shall mean:

 

(a)  The consummation of (i) a
reorganization, merger or consolidation (any of the foregoing, a “Merger”), in each case, with respect to which
the individuals and entities who were the beneficial owners of the Voting Stock immediately prior to such Merger do not, following
such Merger, beneficially own, directly or indirectly, more than 50% of the then outstanding shares of common stock of the corporation
resulting from the Merger (the Resulting Corporation”) as a result of the individuals’ and entities’ shareholdings
in the Company immediately prior to the consummation of the Merger and without regard to any of the individual’s and entities’
shareholdings in the Resulting Corporation immediately prior to the consummation of the Merger, (ii) a complete liquidation or
dissolution of the Company, or (iii) the sale or other disposition of all or substantially all of the assets of the Company, excluding
a sale or other disposition of assets to a subsidiary of the Company.

 

g.  Dissolution or Liquidation.  In
the event of the proposed dissolution or liquidation of the Company or termination of an Award under Section 7(f)(i)(E),
the Board shall notify each Participant as soon as practicable prior to the effective date of such proposed transaction.  The
Board in its sole discretion may provide for a Participant to have the right to exercise his or her Award until fifteen (15) days
prior to such transaction as to all of the shares of Common Stock covered by the Option or Award, including shares as to which
the Option or Award would not otherwise be exercisable, which exercise may in the sole discretion of the Board, be made subject
to and conditioned upon the consummation of such proposed transaction.  In addition, the Board may provide that any Company
repurchase option applicable to any shares of Common Stock purchased upon exercise of an Option or Award shall lapse as to all
such shares of Common Stock, provided the proposed dissolution and liquidation takes place at the time and in the manner contemplated.  To
the extent it has not been previously exercised, an Award will terminate upon the consummation of such proposed action.

 

h.  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 stock of an entity, the Board may grant Awards under the Plan in substitution for stock and stock-based
awards issued by such entity or an affiliate thereof.  The substitute Awards shall be granted on such terms and conditions
as the Board considers appropriate in the circumstances.

 

    	 

    	 

    
 

i.  Parachute Payments and
Parachute Awards.  Notwithstanding the provisions of Section 7(f), if, in connection with a Change of Control
described therein, a tax under Section 4999 of the Code would be imposed on the Participant (after taking into account
the exceptions set forth in Sections 280G(b)(4) and 280G(b)(5) of the Code) and not otherwise paid for by the Company, then the
number of Awards which shall become exercisable, realizable or vested as provided in such Section shall be reduced (or delayed),
to the minimum extent necessary, so that no such tax would be imposed on the Participant (the Awards not becoming so accelerated,
realizable or vested, the “Parachute Awards”); provided, however, that if the “aggregate present value”
of the Parachute Awards would exceed the tax that, but for this sentence, would be imposed on the Participant under Section 4999
of the Code in connection with the Change of Control, then the Awards shall become immediately exercisable, realizable and vested
without regard to the provisions of this sentence.  For purposes of the preceding sentence, the “aggregate present
value” of an Award shall be calculated on an after-tax basis (other than taxes imposed by Section 4999 of the Code) and shall
be based on economic principles rather than the principles set forth under Section 280G of the Code and the regulations promulgated
thereunder.  All determinations required to be made under this Section 7(i) shall be made by the Company.

 

j.  Amendment of Awards.  The
Board may amend, modify or terminate any outstanding Award including, but not limited to, substituting therefor another Award of
the same or a different type, changing the date of exercise or realization, and converting an Incentive Stock Option to a Nonstatutory
Stock Option, provided that the Participant's consent to such action shall be required unless the Board determines that the action,
taking into account any related action, would not materially and adversely affect the Participant.

 

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

 

l.  Acceleration.  The
Board may at any time provide that any Award shall become immediately exercisable in full or in part, or that any other stock-based
Awards may become exercisable in full or in part or free of some or all restrictions or conditions, or otherwise realizable in
full or in part, as the case may be, despite the fact that the foregoing actions may (i) cause the application of Sections 280G
and 4999 of the Code if a Change In Control of the Company occurs, or (ii) disqualify all or part of the Option as an Incentive
Stock Option.  In addition, the Board may, in its sole discretion, and in all instances subject to any relevant tax and
accounting considerations which may adversely impact or impair the Company, extend the dates during which all or any particular
Options or Awards granted under the Plan may be exercised.

 

m.  Participation in Foreign
Countries.  The Board shall have the authority to adopt such modifications, procedures, and subplans as may be necessary
or desirable to comply with provisions of the laws of foreign countries in which the Company or its Subsidiaries may operate to
assure the viability of the benefits from Awards granted to Participants performing services in such countries and to meet the
objectives of the Plan.

 

8.  Withholding.  The Company shall
have the right to deduct from payments of any kind otherwise due to the optionee or recipient of an Award any federal, state, or
local taxes of any kind required by law to be withheld with respect to any shares issued upon exercise of Options under the Plan
or the purchase of shares subject to the Award.  Subject to the prior approval of the Company, which may be withheld
by the Company in its sole discretion, the optionee or recipient of an Award may elect to satisfy such obligation, in whole or
in part, (a) by causing the Company to withhold shares of Common Stock otherwise issuable pursuant to the exercise of an Option
or the purchase of shares subject to an Award or (b) by delivering to the Company shares of Common Stock already owned by the optionee
or Award recipient of an Award.  The shares so delivered or withheld shall have a fair market value of the shares used
to satisfy such withholding obligation as shall be determined by the Company as of the date that the amount of tax to be withheld
is to be determined.  An optionee or recipient of an Award who has made an election pursuant to this Section may only
satisfy his or her withholding obligation with shares of Common Stock which are not subject to any repurchase, forfeiture, unfulfilled
vesting, or other similar requirements.

 

    	 

    	 

    
 

9.  No Exercise of Option if Engagement or Employment
Terminated for Cause.  If the employment or engagement of any Participant is terminated “for Cause”,
the Award may terminate, upon a determination of the Board, on the date of such termination and the Option shall thereupon not
be exercisable to any extent whatsoever and the Company shall have the right to repurchase any shares of Common Stock subject to
a Restricted Stock Award whether or not such shares have vested.  For purposes of this Section 9, “for
Cause” shall be defined as follows:  (i) if the Participant has executed an employment agreement, the definition
of “cause” contained therein, if any, shall govern, or (ii) if the Participant has not executed an employment agreement
in which the definition of “cause” is provided, conduct, as determined by the Board of Directors, involving one or
more of the following: (a) gross misconduct or inadequate performance by the Participant which is injurious to the Company; or
(b) the commission of an act of embezzlement, fraud or theft, which results in economic loss, damage or injury to the Company;
or (c) the unauthorized disclosure of any trade secret or confidential information of the Company (or any client, customer, supplier,
or other third party who has a business relationship with the Company) or the violation of any noncompetition or nonsolicitation
covenant or assignment of inventions obligation with the Company; or (d) the commission of an act which constitutes unfair competition  with
the Company or which induces any customer or prospective customer of the Company to breach a contract with the Company or to decline
to do business with the Company (to the extent such restriction is enforceable under applicable state law; or (e) the indictment
or conviction of the Participant for a felony or serious misdemeanor offense, either in connection with the performance of his
or her obligations to the Company or which shall adversely affect the Participant's ability to perform such obligations; or (f)
the commission of an act of fraud or breach of fiduciary duty which results in loss, damage or injury to the Company; or (g) the
failure of the Participant to perform in a material respect his or her employment, consulting or advisory obligations without proper
cause.  The Board may in its discretion waive or modify the provisions of this Section at a meeting of the Board with
respect to any individual Participant with regard to the facts and circumstances of any particular situation involving a determination
under this Section.

 

10.  Miscellaneous.

 

a.  Definitions.

 

i.  “Company”,
for purposes of eligibility under the Plan, shall include any present or future subsidiary corporations of TranSwitch Corporation,
as defined in Section 424(f) of the Code (a “Subsidiary”), and any present or future parent corporation of TranSwitch
Corporation, as defined in Section 424(e) of the Code.  For purposes of Awards other than Incentive Stock Options, the
term “Company” shall include any other business venture in which the Company has a direct or indirect significant interest,
as determined by the Board in its sole discretion.

 

ii.  “Code” means
the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder.

 

iii.  “Effective Date”
means the date the Plan is approved by the Company’s stockholders.

 

iv.  “Employee”
for purposes of eligibility under the Plan shall include a person to whom an offer of employment has been extended by the Company.

 

b.  No Right To Employment
or Other Status.  No person shall have any claim or right to be granted an Award, and the grant of an Award shall
not be construed as giving a Participant the right to continued employment or any other relationship with the Company.  The
Company expressly reserves the right at any time to dismiss or otherwise terminate its relationship with a Participant free from
any liability or claim under the Plan.  Except as specifically provided by the Board in any particular case, the loss
of existing or potential profit and Awards granted under this Plan will not constitute an element of damages in the event of termination
of an employment relationship even if the termination is in violation of an obligation of the Company to the Participant.

 

c.  Compliance with Law.  The
Company shall not be required to sell or issue any shares of Common Stock under any Award if the sale or issuance of such shares
would constitute a violation by the Participant, any other individual exercising an Option, or the Company of any provision of
any law or regulation of any governmental authority, including without limitation any federal or state securities laws or regulation.  If
at any time the Company shall determine, in its discretion, that the listing, registration or qualification of any share subject
to an Award up on any security exchange or under any governmental regulatory body is necessary or desirable as a condition of,
or in connection with, the issuance or purchase of shares hereunder, no shares of Common Stock may be issued or sold to the Participant
or any other individual exercising an Option pursuant to such Award unless such listing, registration, qualification, consent,
or approval shall have been effected or obtained free of any conditions not acceptable to the Company, and any delay caused thereby
shall in no way effect the date of termination of the Award.  Any determination in connection with the preceding sentence
by the Board shall be final, binding and conclusive.  The Company may, but shall in no event be obligated to, register
any securities covered hereby pursuant to the Securities Act.  The Company shall not be obligated to take any affirmative
action in order to cause the exercise of an Option or the issuance of shares of Common Stock pursuant to the Plan to comply with
any law or regulation of any governmental authority.  As to any jurisdiction that expressly imposes that a Option shall
not be exercised until the shares of Common Stock covered by such Option are registered or exempt from registration, the exercise
of such Option (under circumstances in which the laws of such jurisdiction apply) shall be deemed conditioned up on the effectiveness
of such registration or availability of such an exemption.

 

    	 

    	 

    
 

d.  No Rights As Stockholder.  Subject
to the  provisions of the applicable Award, no Participant or Designated Beneficiary shall have any rights as a stockholder
with respect to any shares of Common Stock to be distributed with respect to an Award until becoming the record holder thereof.

 

e.  Effective Date and Term
of Plan.  The Plan shall become effective on the date on which it is approved by the stockholders.  No
Awards shall be granted under the Plan after the completion of ten years from the date on which the Plan was approved by the stockholders,
but Awards previously granted may extend beyond that date.

 

f.  Amendment of Plan.  The
Board of Directors may, at any time, suspend or terminate the Plan or revise or amend it in any respect whatsoever.  An
Amendment shall be contingent on approval of the Company’s stockholders to the extent stated by the Board, required by applicable
law or required by applicable stock exchange listing requirements.

 

g.  Governing Law.  The
provisions of the Plan and all Awards made hereunder shall be governed by and interpreted in accordance with the laws of the State
of Delaware, without regard to any applicable conflicts of law principles.

 

Original Plan

 

	Adopted by the Board of Directors on:	April 8, 2008
	 	 
	Approved by the Stockholders on:	May 22, 2008

 

As Amended to increase the authorized share number

 

	Adopted by the Board of Directors on:	April 7, 2009
	 	 
	Approved by the Stockholders on:	May 21, 2009

 

As Amended to increase the authorized share number

 

	Adopted by the Board of Directors on:	April 1, 2010
	 	 
	Approved by the Stockholders on:	May 20, 2010

 

As Amended to increase the authorized share number

 

	Adopted by the Board of Directors on:	March 22, 2012
	 	 
	Approved by the Stockholders on:	May 17, 2012EMPLOYMENT AGREEMENT

 

This Employment Agreement
is made and entered into this 17th day of May, 2012 (the “Agreement”), by and between TranSwitch Corporation, a Delaware
corporation whose principal offices are located at 3 Enterprise Drive, Shelton, Connecticut (the “Company”) and _______________
(the “Executive”).

 

WITNESSETH:

 

WHEREAS, Executive
is currently employed with the Company; and

 

WHEREAS, the Company
and Executive wish to continue their employment relationship, subject to the terms and conditions set forth in this Agreement.

 

NOW THEREFORE, in consideration
of the promises and the covenants contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Company and the Executive hereby agree as follows:

 

1.           Employment.
The Company hereby employs the Executive and the Executive hereby accepts such employment upon the terms and conditions set forth
in this Agreement.

 

2.           Term.
This Agreement shall be effective from May 17, 2012 (the “Effective Date”) until terminated by either the Company or
the Executive pursuant to Section 5 of this Agreement.

 

3.           Duties
and Responsibilities.

 

(a)          The
Executive shall function as the ________________ and shall have the full power and authority consistent with the bylaws of the
Company to manage and conduct all of the duties of the Executive's position and such other duties consistent with the Executive's
position as may be assigned to him from time to time by the President and Chief Executive Officer of the Company. The Executive
shall report directly to the President and Chief Executive Officer. In addition, the Company Board of Directors will designate
the Executive as a Section 16 officer of the Company. During his employment, the Executive agrees to devote his full time, attention,
loyalty, skill and efforts to the performance of his duties to the Company.

 

(b)          The
Executive acknowledges that the Company’s principal executive offices are currently located in Shelton, Connecticut. The
Executive’s principal place of employment shall be the Company’s principal executive offices. The Executive agrees
that he will be regularly present at the Company’s principal executive offices. The Executive acknowledges that he may be
required to travel from time to time in the course of performing his duties for the Company.

 

4.       Compensation.
In consideration of all services rendered by the Executive during the term of his employment, pursuant to this Agreement, the Company
will provide the Executive with the following compensation (“Total Compensation”) during the term of this Agreement:

 

(a)          Base
Annual Salary. The Company shall pay to the Executive a bi-weekly salary of $9,615.39, the annual equivalent of $250,000, for
all time worked (the “Base Salary”). The Executive shall receive his Base Salary consistent with the Company’s
pay periods for similarly situated executives and subject to the regular payroll deductions.

 

    	 

    	 

    

 

(b)          Target
Incentive Compensation.

 

(i)          Sales
Incentive Plan. Executive shall be eligible to participate in the Company’s Sales Incentive Plan, as such plan is promulgated
and amended from time to time by the Company Board. The Company retains the right to modify and/or discontinue its Sales Incentive
Plan.

 

(A)         Executive
shall have a target annual Short-Term Incentive Award for 2012 equivalent to 40% of his base salary payable in cash or Restricted
Stock Units (“RSUs”) of the Company’s common stock or such manner as specified by the terms and conditions of
the Company’s Sales Incentive Plan. The award of a bonus, if any, will be governed and controlled by the terms and conditions
of the Company’s Sales Incentive Plan then in effect.

 

(B)         Equity
awarded as part of the Company’s Sales Incentive Plan for 2012 shall vest 100% on the first anniversary of the grant date
pursuant to the terms and conditions of the Company’s 2008 Equity Incentive Plan, as amended, the Company’s Stock Option
Award Terms, and the Company’s Restricted Stock Unit Award Agreement.

 

(ii)         Long-Term
Incentive Plan. Executive shall be eligible to participate in the Company’s Long-Term Incentive Plan, as such plan is
promulgated and amended from time to time by the Company Board. The Company retains the right to modify and/or discontinue its
Long-Term Incentive Plan.

 

(c)          Employee
Benefits.

 

(i)          The
Executive will be entitled to participate in the benefit plans and programs (collectively, the "Benefit Plans") as are
from time to time generally available to other employees of the Company, subject to the provisions of those Benefit Plans: including,
but not limited to, group health, dental and vision insurance, short-term and long-term disability insurance, life and AD&D
insurance, flexible spending account, Employee Stock Purchase Plan, and 401(k) plan. Executive will be required to contribute towards
the cost of these plans on the same basis as other employees. 

 

(ii)         The
Executive will be entitled to vacation, holidays, and sick leave in accordance with the Company's policies as they may change from
time to time, but in no event shall the Executive be entitled to less than 15 days of paid vacation per year and five days of sick
leave per year. Unused vacation days may accrue up to a maximum of 30 days.

 

(iii)        During
the term of this Agreement, the Company will provide Executive term life insurance on his life in an amount equal to $500,000.00.
The Company will pay for all costs attributable to such coverage. The Executive will have the right to designate the beneficiary
of such policy or policies. Upon termination of this Agreement, the Executive shall have the option to assume the premium obligations
of the policy or policies, in which event the Company shall assign all its rights in the policy to the Executive.

 

(d)          Business
and Travel Related Expenses. Subject to and in accordance with the Company's policies and procedures and upon presentation
of itemized receipts, Executive shall be reimbursed by the Company for reasonable and necessary business-related expenses, which
expenses are incurred by the Executive on behalf of the Company. Such expenses shall be reviewed from time to time by the Company
Chief Financial Officer.

 

    	Page 2 of 7

    	 

    

 

(e)          Indemnification
Agreement. The Company and the Executive have previously entered into and agree to be bound by that certain Indemnification
Agreement which is attached hereto and made a part hereof.

 

(f)          Compensation
Review. The Compensation Committee and the Company Board will review the Executive’s Total Compensation annually and
from time to time with that of other executives in the Company. Executive’s performance will be reviewed on a calendar year
basis.

 

5.          Termination.
This Agreement, and Executive’s employment with the Company, shall terminate under the following conditions:

 

(a)          By
the Company, immediately on the death of Executive.

 

(b)          By
the Executive, upon his voluntary termination, which shall require the Executive to give notice to the Company no later than 30
days before the effective date of such termination. Termination by the Executive for “Good Reason” shall be as set
forth in Section 5(g) below.

 

(c)          By
the Company, upon the Disability of the Executive, which shall mean a physical or mental infirmity that impairs the Executive’s
ability to substantially perform the essential duties of his position, with or without a reasonable accommodation as required by
applicable federal and state law, for a period of 180 consecutive days (“Disability”). At the end of such 180-day period
of Disability, the Company may, at its option, terminate this Agreement.

 

(d)          Termination
for Cause. By the Company, for “Cause,” which for purposes of this Agreement, shall mean any of the following behaviors
by the Executive: (i) the refusal or willful failure to attempt in good faith to perform duties; (ii) dishonesty or willful misconduct
in the performance of duties; (iii) involvement in a transaction in connection with the performance of duties for the Company,
which transaction is adverse to the interest of the Company or which is engaged in for personal profit; (iv) a material breach
of this Agreement and the Assignment (as defined in below), including, but not limited to provisions related to confidentiality,
non-competition and non-solicitation; (v) a material breach of the Company’s Code of Business Conduct and Ethics; (vi) such
other reason as would normally be treated as cause under common law; (vii) willful violation of any law, rule or regulation in
connection with the performance of duties (other than minor traffic violations or similar offenses) or constituting a felony or
a crime of moral turpitude. Before implementing the termination for cause provisions of this Section 5(d) for reasons (i) through
(vii) above, the President and CEO shall provide to the Executive written notice of termination and shall allow 30 days in which
to cure the situation leading to the intended termination for cause.

 

(e)          Termination
Without Cause. By the Company, “Without Cause,” which for purposes of this Agreement, shall mean termination by
the Company for any reason other than those set forth in Sections 5(a), 5(c), 5(d) and 5(f). The Company will give the Executive
30 days advance written notice of its intention to terminate the Agreement Without Cause.

 

(f)          Termination
as result of a Change of Control. By the Company, Without Cause, on the day of or within twelve (12) months following the occurrence
of any of the following events (“Change of Control”):

 

    	Page 3 of 7

    	 

    

 

(i)          Acquisition
of Stock by Third Party. Any “Person” (as defined below) is or becomes the “Beneficial Owner” (as defined
below), directly or indirectly, of securities of the Company representing 51% or more of the combined voting power of the Company’s
then outstanding securities. “Person” shall have the meaning as set forth in Sections 13 and 14 of the Securities Exchange
Act of 1934, as amended from time to time, and the rules and regulations promulgated thereunder (the “Exchange Act”)
(including without limitation any two or more persons acting as a group and deemed to be a single person under Section 13(d) pursuant
to Section 13(d)(3) and Rule 13d-5 promulgated thereunder); provided, however, that Person shall exclude (A) the
Company, (B) any trustee or other fiduciary holding securities under an employee benefit plan of the Company, and (C) any corporation
owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock
of the Company. “Beneficial Owner” shall have the meaning given to such term in Rule 13d-3 under the Exchange Act;
provided, however, that Beneficial Owner shall exclude any Person otherwise becoming a Beneficial Owner by reason
of the stockholders of the Company approving a merger of the Company with another entity.

 

(ii)         Corporate
Transactions. The effective date of a merger or consolidation of the Company with any other entity, other than a merger or
consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation
continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity)
more than 51% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such
merger or consolidation and with the power to elect at least a majority of the board of directors or other governing body of such
surviving entity.

 

(iii)        Liquidation.
The approval by the stockholders of the Company of a liquidation of the Company or an agreement for the sale or disposition by
the Company of all or substantially all of the Company’s assets.

 

(iv)         Other
Events. There occurs any other event of a nature that would be required to be reported in response to Item 6(e) of Schedule
14A of Regulation 14A (or a response to any similar item on any similar schedule or form) promulgated under the Exchange Act, whether
or not the Company is then subject to such reporting requirement.

 

(g)          Termination
for “Good Reason”.

 

(i)          By
the Executive, following the occurrence, without Executive’s prior written consent, of a material reduction in the Executive’s
then-current Base Salary (“Good Reason”). For the purposes of this Agreement, “material reduction” means
a reduction of at least 20%.

 

(ii)         Such
a termination by the Executive will only be deemed to be for Good Reason if: (A) a “Good Reason” event occurs; (B)
Executive gives 60 days written notice to the Company Board of his intention to terminate for Good Reason, where such notice is
delivered to the Company Board within 60 days of the occurrence of the Good Reason Event; (C) the Company Board has 30 days to
cure the Good Reason Event, during which time the Executive shall cooperate with the Company in good faith should the Company choose
to cure the Good Reason Event; (D) the Good Reason Event is not cured during the 30 day cure period; and (E) Executive continues
to work until the expiration of the 60 day notice period, at which time his employment is terminated.

 

6.          Payments
upon Termination.

 

(a)          In
the event the Executive’s employment terminates during the term of this Agreement under the conditions set forth in Sections
5(e), 5(f) or 5(g):

 

    	Page 4 of 7

    	 

    

 

(i)          The
Company shall pay the Executive severance pay in an amount equal to nine months of then-current Base Salary. Such payment shall
be made in substantially equal monthly installments, commencing within one month of the date on which the Executive’s employment
is terminated, and ending prior to March 15 of the following calendar year. This constitutes the entire severance amount; the Executive
will not be entitled to any additional cash or equity payments, including, but not limited to, full year, partial year or pro-rated
bonuses, incentives or Awards;

 

(ii)         One
hundred percent (100%) of any unvested stock options and one hundred percent (100%) of any unvested RSUs previously awarded to
the Employee shall vest upon termination; and

 

(iii)        To
the extent the Company continues to offer group health, dental and vision insurance plans to its employees, the Executive may continue
to participate in such plans, subject to and under the same terms and conditions as other similarly situated employees, until the
earlier of: 12 months from the date of termination; the date the Executive reaches normal retirement age; the date on which
the Executive becomes eligible for coverage under another employer’s plan; or the Executive’s cancellation of such
coverage in writing.

 

(b)          The
Company will make the payments set forth in Section 6(a) provided that the Executive signs a general waiver and release in favor
of the Company, prepared by and acceptable to the Company at the time of the Executive’s separation.

 

(c)          In
the event the Executive’s employment terminates under Sections 5(a), 5(b), 5(c) or 5(d), the Executive will not be entitled
to payment other than then-current Base Salary for time worked. The Executive will not be entitled to any additional cash payment,
including, but not limited to, partial year or pro-rated bonuses, incentives or Awards. 

 

7.          Compliance.

 

(a)          409A
Compliance. The pay and benefits provided hereunder are designed to comply with one or more of the exceptions to Section 409A
of the Internal Revenue Code and interpretive guidance thereunder (“Section 409A”). To the extent that such payments
do not comply with one or more of the exceptions to Section 409A, the Company may, in its sole and absolute discretion, reduce
or delay payments hereunder or make other such modifications with respect to the pay and benefits hereunder as it reasonably deems
necessary to comply with one or more of the exceptions to Section 409A. Notwithstanding the terms of this agreement, if the Employee
is a "specified employee" under Section 409A, only amounts exempt from Section 409A as a “short term deferral”
or under the “separation pay” exception, as both terms are defined under the regulations under Section 409A, will be
paid upon a separation from service. Any amounts not eligible for an exemption from Section 409A will be paid not earlier than
six months after a separation from service. Any amount delayed in accordance with the previous sentence will be paid in a lump
sum in the seventh month following a separation from service. In determining the amount of benefits exempt from Section 409A, each
severance payment will be treated as a separate payment.

 

(b)          Code
Section 280G. The pay and benefits hereunder are intended to be less than an amount that would be taxable under Section 280G
of the Internal Revenue Code and interpretive guidance thereunder (“Section 280G”). To the extent that payments under
this Agreement would result in taxation under Section 280G, the Company may, in its sole and absolute discretion, make reductions
or other modifications to such payments or schedule of such payments as it reasonably deems necessary to avoid taxation under Section
280G, and/or to maintain its ability to deduct such payments.

 

    	Page 5 of 7

    	 

    

 

8.          Assignment
of Inventions. The Executive has previously entered into and agrees to be bound by that certain Assignment of Inventions and
Covenants Against Disclosure, Solicitation, Competition, Violation of the US EEA and Misuse of Intellectual Property Agreement
(the “Assignment”) which is attached hereto and made a part hereof.

 

9.          Confidentiality,
Non-Competition and Non-Solicitation. The Executive’s obligations regarding proprietary information and property, confidentiality,
disclosure, competition, and solicitation are found in the Assignment. Breach of any such term or provision shall constitute a
material breach of this Agreement.

 

10.         Non-Disparagement.
In the event the Executive’s employment terminates for any reason whatsoever and/or upon the termination of this Agreement
for any reason, the Executive agrees that he will not publish or communicate any Disparaging (as defined below) remarks, comments,
statements or actions regarding the Company or any of its officers, directors or stockholders for any reason whatsoever, and the
Company agrees not to publish or communicate any Disparaging remarks, comments or statements regarding you for any reason whatsoever.
”Disparaging” remarks, comments, statements or actions are those that impugn the character, honesty, integrity, morality,
business acumen, abilities or any aspect of the operations or business of the individual or entity being disparaged, that adversely
affect the reputation, image, or goodwill, or are designed to induce others not to do business with the individual or entity being
disparaged. Nothing in this paragraph shall be construed to preclude truthful disclosures in response to lawful process as required
by applicable law, regulation, or order or the directive of a court, government agency or regulatory organization.

 

11.         Dispute
Resolution. Any controversy or dispute arising out of or relating to this Agreement or its breach shall be settled by arbitration
in accordance with the commercial rules of the American Arbitration Association, and judgment upon the award rendered by the arbitrator(s)
may be entered in any court having jurisdiction thereof. Such arbitration shall be held in Shelton, Connecticut unless another
location is mutually agreed to by the parties. Each party shall bear its own costs and expenses and shall share equally the cost
of arbitration. The substantive law to be used by the arbitrator(s) shall be the laws of the state of Connecticut, without application
of the principles of conflict of law. The award of the arbitrator(s) may be enforced in the same manner as if it were a final judicial
judgment.

 

12.         Assignment
and Successors. The rights and obligations of the Executive under this Agreement shall not be assigned, transferred, pledged
or otherwise encumbered by the Executive or his legal representative without the prior written consent of the Company. Subject
to the foregoing, this Agreement shall be binding upon and inure to the benefit of the heirs, executors, representatives, successors
and assigns of the parties. Excluding the Assignment referred to in Section 8, this Agreement shall replace any existing employment
agreements or arrangements between the Company and the Executive, all of which shall be of no further force or effect. The Company
may assign this Agreement, without the consent of the Executive, to a purchaser of all or substantially all of the assets of the
Company.

 

13.         Notice.
All notices, consents and other communications required or permitted hereunder shall be in writing and delivered by hand or by
nationally recognized courier service or by U.S. prepaid certified mail addressed to the respective parties as follows:

 

If to Company:

TranSwitch Corporation

3 Enterprise Drive

Shelton, CT 06484

ATTN: Chief Financial Officer

 

    	Page 6 of 7

    	 

    

 

If to Executive:

Theodore Chung

At the address
currently on file with the Company

 

14.         Modifications,
Waivers and Survival of Obligations.

 

(a)          No
provision of this Agreement may be modified, waived or discharged unless such modification, waiver or discharge is agreed to in
writing and signed by the Executive and the Company. A waiver of any condition or provision of this Agreement shall be limited
to the terms and conditions of such waiver and shall not be construed as a waiver of any other provision or condition.

 

(b)          The
Executive agrees that his obligations and the covenants contained in this Agreement and the Assignment, which obligation include
but are not limited to confidentiality, non-disclosure, non-competition, non-solicitation, return of company property and non-disparagement,
shall survive the termination of this Agreement, regardless of the cause of such termination.

 

15.         Governing
Law. This Agreement shall be governed by the laws of the State of Connecticut applicable to contracts made and to be performed
in said state without regard to the conflicts of laws or rules thereof.

 

16.         Severability.
The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect
the validity or enforceability of the other provisions.

 

17.         Headings:
The descriptive headings of the several Sections of this Agreement are inserted for convenience of reference only and
shall not constitute a part of this Agreement.

 

18.         Presumption:
This Agreement or any Section thereof shall not be construed against any party due to the fact that said Agreement or any Section
thereof was drafted by said party.

 

19.         Consistency.
This Agreement is intended to be consistent with the Company’s Sales Incentive Plan, Long-Term Incentive Plan, Stock Option
Award Terms, 2008 Equity Incentive Plan, as amended, and Restricted Stock Unit Award Agreement (the “Documents”). Unless
otherwise specifically provided in this Agreement and permitted by the Documents, in the case of a conflict of a term and/or condition
between the Agreement and one of the Documents, the term and/or condition of the Documents shall supersede that of the Agreement.

 

IN WITNESS WHEREOF,
the parties have hereunto set their hand as of the date first written above.

 

TRANSWITCH CORPORATION

 

	By:	   	 	   
	 	 M. Ali Khatibzadeh	 	
	 	 President & CEO	 	 
		 	
		 	 

 

    	Page 7 of 7

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