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ARBOR HEALTH TECHNOLOGIES INC.

STOCK OPTION AGREEMENT

Under the 2024 Equity Incentive Plan

Form of Agreement for Incentive Stock Options and Non-Qualified Stock Options

This is a form of Stock Option Agreement for use in connection with grants of stock options under the Arbor Health Technologies Inc. 2024 Equity Incentive Plan (the "Plan"). This form is intended for use with both Incentive Stock Options ("ISOs") within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"), and Non-Qualified Stock Options ("NQSOs"). Bracketed placeholders indicate fields to be completed at the time of grant. This form has been prepared by Calderwood & Harkness LLP, outside counsel to the Company, and should not be modified without prior review by the Company's General Counsel or outside counsel.

ARBOR HEALTH TECHNOLOGIES INC.

STOCK OPTION GRANT NOTICE

(2024 Equity Incentive Plan)

Arbor Health Technologies Inc., a Delaware corporation (the "Company"), hereby grants to the individual named below (the "Participant") an option (the "Option") to purchase the number of shares of common stock of the Company set forth below (the "Shares"), at the exercise price per share set forth below (the "Exercise Price"), subject to the terms and conditions set forth in this Stock Option Grant Notice (this "Grant Notice"), the Stock Option Agreement attached hereto as Exhibit A (the "Agreement"), and the Arbor Health Technologies Inc. 2024 Equity Incentive Plan (the "Plan").

PARTICIPANT INFORMATION:

GRANT DETAILS:

Note: The Exercise Price per Share must not be less than one hundred percent (100%) of the Fair Market Value of a share of common stock on the Date of Grant, as determined in accordance with the Plan. For Incentive Stock Options granted to a Participant who, at the time of grant, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any parent or subsidiary corporation (a "Ten Percent Stockholder"), the Exercise Price per Share must not be less than one hundred ten percent (110%) of the Fair Market Value on the Date of Grant. The Expiration Date shall not be later than ten (10) years from the Date of Grant; provided, however, that for Incentive Stock Options granted to a Ten Percent Stockholder, the Expiration Date shall not be later than five (5) years from the Date of Grant.

VESTING SCHEDULE:

The Option shall vest and become exercisable in accordance with the following schedule, subject in each case to Participant's Continuous Service (as defined in the Plan) with the Company or any subsidiary through each applicable vesting date:

(a) Cliff Vesting: Twenty-five percent (25%) of the total number of Shares subject to the Option shall vest and become exercisable on the first anniversary of the Vesting Commencement Date (the "Cliff Date").

(b) Monthly Vesting: The remaining seventy-five percent (75%) of the total number of Shares subject to the Option shall vest and become exercisable in thirty-six (36) equal monthly installments following the Cliff Date, with each such installment vesting on the same day of each calendar month as the Cliff Date (or, if there is no such day in a given month, on the last day of such month), such that one hundred percent (100%) of the Shares subject to the Option shall be fully vested on the fourth anniversary of the Vesting Commencement Date, subject to Participant's Continuous Service through each such vesting date.

Note: If an alternative vesting schedule applies to Participant (whether pursuant to an employment agreement, offer letter, or other written arrangement approved by the Committee), such alternative vesting schedule shall be set forth below in lieu of the foregoing standard schedule:

[Insert modified vesting schedule, if applicable.]

VESTING TABLE:

PLAN REFERENCE:

This Option is granted under and governed by the terms and conditions of the Arbor Health Technologies Inc. 2024 Equity Incentive Plan (the "Plan"), which was adopted by the Board of Directors of the Company on January 15, 2024, and became effective upon the closing of the Company's initial public offering of its common stock on the New York Stock Exchange (the "NYSE") under the ticker symbol "ARHT." A copy of the Plan has been made available to Participant, and Participant acknowledges receipt thereof. Capitalized terms used but not otherwise defined in this Grant Notice or the Agreement shall have the meanings ascribed to such terms in the Plan.

AGREEMENT TO TERMS:

By signing below (or by accepting this grant electronically through the Company's designated equity administration platform), Participant acknowledges receipt of, and agrees to be bound by, (i) this Grant Notice, (ii) the Stock Option Agreement attached hereto as Exhibit A (including all appendices thereto), and (iii) the Plan. Participant further acknowledges that Participant has reviewed each of the foregoing documents and has had the opportunity to consult with Participant's own legal and tax advisors regarding the terms and consequences of this Option grant.

ARBOR HEALTH TECHNOLOGIES INC.

By: ________

Name: [Insert Authorized Officer Name]

Title: [Insert Title]

Address: 275 Kendall Avenue, Suite 1400

Cambridge, MA 02142

PARTICIPANT:

Signature: ________

Name: [Insert Participant Name]

Date: ________

EXHIBIT A

ARBOR HEALTH TECHNOLOGIES INC.

STOCK OPTION AGREEMENT

(2024 Equity Incentive Plan)

TERMS AND CONDITIONS

This Stock Option Agreement (together with the Grant Notice to which this Agreement is attached, this "Agreement") is entered into by and between Arbor Health Technologies Inc., a Delaware corporation (the "Company"), and the individual identified in the Grant Notice (the "Participant"), effective as of the Date of Grant set forth in the Grant Notice.

Section 1. Grant of Option

1.1 Grant. The Company hereby grants to Participant an option (the "Option") to purchase the number of shares of common stock, par value $0.001 per share, of the Company (the "Common Stock") set forth in the Stock Option Grant Notice (the "Grant Notice") to which this Agreement is attached, at the Exercise Price per Share set forth in the Grant Notice, and subject to the terms and conditions set forth in this Agreement and the Plan. The shares of Common Stock issuable upon exercise of the Option are sometimes referred to herein as the "Shares."

1.2 Type of Option. The Option is designated as either an Incentive Stock Option or a Non-Qualified Stock Option, as specified in the Grant Notice. If the Option is designated as an Incentive Stock Option, it is intended to qualify as an "incentive stock option" within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"), to the maximum extent permitted by law. To the extent that the Option does not so qualify, or ceases to so qualify, it shall be treated as a Non-Qualified Stock Option. If the Option is designated as a Non-Qualified Stock Option, it is not intended to qualify as an incentive stock option under Section 422 of the Code.

1.3 Incorporation of Plan. The Arbor Health Technologies Inc. 2024 Equity Incentive Plan (the "Plan") is incorporated herein by reference in its entirety and made a part of this Agreement. In the event of any conflict or inconsistency between the terms and conditions of this Agreement and those of the Plan, the terms and conditions of the Plan shall control and prevail. The Option is subject to all of the terms and conditions of the Plan, including the powers of the Committee (as defined below) set forth therein.

1.4 Share Reserve. Participant acknowledges that the Plan provides for a total share reserve of 10,300,000 shares of Common Stock, which represents approximately ten percent (10%) of the Company's post-IPO outstanding shares of 103,000,000 shares of Common Stock, subject to adjustment as provided in the Plan. The Option granted hereunder is made from such share reserve, subject to the terms and limitations of the Plan.

Section 2. Definitions

Capitalized terms used but not defined in this Agreement shall have the meanings ascribed to such terms in the Plan. The following terms shall have the meanings set forth below for purposes of this Agreement:

2.1 "Agreement" means this Stock Option Agreement, including the Grant Notice to which this Agreement is attached, and all appendices and exhibits hereto, as the same may be amended from time to time in accordance with the terms hereof.

2.2 "Board" means the Board of Directors of the Company.

2.3 "Cause" shall have the meaning ascribed to such term in the Plan; provided, however, that if Participant is a party to an employment agreement, consulting agreement, severance agreement, or other similar written agreement with the Company or any subsidiary that contains a definition of "Cause" (or a similar term), then "Cause" shall have the meaning set forth in such agreement, to the extent that such definition is more favorable to Participant.

2.4 "Code" means the Internal Revenue Code of 1986, as amended from time to time, and the rules, regulations, and guidance promulgated thereunder.

2.5 "Committee" means the Compensation Committee of the Board, or such other committee of the Board as may be designated by the Board to administer the Plan, or the Board itself if no such committee has been designated. To the extent required by applicable law, rule, or regulation (including Rule 16b-3 under the Securities Exchange Act of 1934, as amended), the Committee shall consist of two or more members of the Board, each of whom is a "non-employee director" within the meaning of Rule 16b-3.

2.6 "Continuous Service" shall have the meaning ascribed to such term in the Plan, which generally means uninterrupted service as an employee, director, or consultant of the Company or any subsidiary, as determined by the Committee in its sole discretion. A change in the capacity in which Participant renders service to the Company or a subsidiary (e.g., from employee to consultant) shall not constitute a termination of Continuous Service, provided that there is no interruption in such service.

2.7 "Disability" shall have the meaning ascribed to such term in the Plan. For purposes of Incentive Stock Options, "Disability" means a disability within the meaning of Section 22(e)(3) of the Code (i.e., the inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or that has lasted or can be expected to last for a continuous period of not less than 12 months).

2.8 "Exercise Price" means the per-share exercise price set forth in the Grant Notice, as adjusted from time to time in accordance with Section 11 of this Agreement and the Plan.

2.9 "Expiration Date" means the date set forth in the Grant Notice as the expiration date of the Option, as such date may be subject to earlier termination in accordance with Section 5 and Section 6 of this Agreement.

2.10 "Fair Market Value" shall have the meaning ascribed to such term in the Plan. As of the date hereof, Fair Market Value means the closing sales price of a share of Common Stock on the NYSE (ticker symbol: ARHT) on the relevant date, or if there are no sales on such date, on the last preceding trading day on which sales occurred. If the Common Stock is not listed on a national securities exchange at the relevant time, Fair Market Value shall be determined by the Committee in good faith in accordance with the Plan and Section 409A of the Code.

2.11 "Good Reason" shall have the meaning ascribed to such term in the Plan, or if Participant is a party to an employment agreement, consulting agreement, severance agreement, or other similar written agreement with the Company or any subsidiary that contains a definition of "Good Reason" (or a similar term), then "Good Reason" shall have the meaning set forth in such agreement.

Section 3. Vesting

3.1 Vesting Schedule. The Option shall vest and become exercisable in accordance with the vesting schedule set forth in the Grant Notice. Unless otherwise specified in the Grant Notice or in a separate written agreement between the Company and Participant approved by the Committee, the standard vesting schedule shall be as follows: twenty-five percent (25%) of the total number of Shares subject to the Option shall vest and become exercisable on the first anniversary of the Vesting Commencement Date (the "Cliff Date"), and the remaining seventy-five percent (75%) of the Shares shall vest and become exercisable in thirty-six (36) equal monthly installments thereafter, with each installment representing one forty-eighth (1/48th) of the total number of Shares subject to the Option. Full vesting shall occur on the fourth anniversary of the Vesting Commencement Date, subject to Participant's Continuous Service through each applicable vesting date.

3.2 Continuous Service Requirement. Vesting of the Option is contingent upon Participant's Continuous Service with the Company or any subsidiary through each applicable vesting date. If Participant's Continuous Service terminates for any reason, vesting of the Option shall immediately cease, and no further Shares shall vest after the date of such termination. No partial vesting credit shall be given for any period of Continuous Service that is less than a full vesting increment (i.e., less than the one-year cliff period for the initial tranche, or less than a full calendar month for subsequent monthly tranches). For the avoidance of doubt, if Participant's Continuous Service terminates on a date that falls between two monthly vesting dates, Participant shall not receive vesting credit for the partial month in which such termination occurs.

3.3 Acceleration. Unless otherwise provided in a written agreement between the Company and Participant (including, without limitation, an employment agreement, offer letter, change in control severance agreement, or other arrangement approved by the Committee), there shall be no automatic acceleration of vesting of the Option upon a Change in Control (as defined in the Plan) or upon any other event. Any acceleration of vesting shall be subject to the terms and conditions of the Plan and any applicable written agreement between the Company and Participant, as approved by the Committee in its sole discretion. For the avoidance of doubt, the Committee retains full discretion under the Plan to provide for acceleration of vesting in connection with a Change in Control or other corporate transaction, subject to the terms and conditions of the Plan.

3.4 No Right to Continued Service. Nothing in this Agreement, the Grant Notice, or the Plan shall confer upon Participant any right to continue as an employee, director, or consultant of the Company or any subsidiary, or shall interfere with or restrict in any way the right of the Company or any subsidiary to terminate Participant's Continuous Service at any time, with or without Cause, subject to applicable law and the terms of any written employment agreement or consulting agreement between Participant and the Company or any subsidiary.

Section 4. Exercise of Option

4.1 Method of Exercise. Subject to the terms and conditions of this Agreement and the Plan, the vested and unexercised portion of the Option may be exercised, in whole or in part, at any time and from time to time during the period beginning on the date such portion becomes vested and ending on the earlier of (a) the Expiration Date or (b) the date the Option terminates in accordance with Section 6 of this Agreement. To exercise the Option, Participant shall deliver to the Company (or its designee, including any stock plan administrator or broker designated by the Company) a written notice of exercise in the form attached hereto as Appendix A (or in such other form as may be prescribed by the Committee from time to time), or an electronic notice of exercise submitted through the Company's designated equity administration platform, specifying the number of Shares to be purchased and the method of payment of the aggregate Exercise Price. Such notice shall be accompanied by payment of the aggregate Exercise Price for the Shares being purchased and payment (or arrangement for payment) of any applicable tax withholding amounts, as described in Section 8 of this Agreement.

4.2 Minimum Exercise. Unless the total number of vested and unexercised Shares is less, the minimum number of Shares for which the Option may be exercised at any one time shall be one hundred (100) Shares. The Committee may, in its sole discretion, waive or modify this minimum exercise requirement.

4.3 Forms of Payment. The aggregate Exercise Price for the Shares being purchased upon exercise of the Option may be paid by one or a combination of the following methods, as permitted by the Committee in its sole discretion:

(a) Cash or Check. Payment by cash, cashier's check, money order, or personal check payable to the order of the Company, in an amount equal to the aggregate Exercise Price for the Shares being purchased.

(b) Broker-Assisted Cashless Exercise. A "cashless" exercise through a simultaneous sale and remittance procedure pursuant to which Participant shall concurrently provide irrevocable instructions to (i) a broker or dealer designated or approved by the Company (the "Broker") to effect the immediate sale of the Shares being purchased (or a sufficient number thereof) in the open market, and (ii) the Broker to remit to the Company, out of the sale proceeds, an amount equal to the aggregate Exercise Price for the Shares being purchased plus any applicable tax withholding amounts. Such sale and remittance shall be effected on a same-day basis or as promptly as practicable following the date of exercise.

(c) Net Exercise / Share Withholding. A "net exercise" procedure pursuant to which the Company shall reduce the number of Shares otherwise issuable upon exercise by a number of Shares having a Fair Market Value on the date of exercise equal to the aggregate Exercise Price for the Shares being purchased (and, if approved by the Committee, any applicable tax withholding amounts). This method of payment shall be available only with the prior approval of the Committee, in its sole discretion.

(d) Previously Owned Shares. Delivery (either by actual delivery or attestation) of shares of Common Stock already owned by Participant that have been held by Participant for at least six (6) months (or such other period as may be required by the Committee to avoid adverse accounting treatment under applicable accounting standards), with a Fair Market Value on the date of exercise equal to the aggregate Exercise Price for the Shares being purchased. Such previously owned shares shall be free and clear of any liens, claims, encumbrances, or security interests.

(e) Other Methods. Such other consideration or method of payment as the Committee may permit, in its sole discretion, consistent with the terms of the Plan and applicable law.

4.4 Issuance of Shares. Upon valid exercise of the Option in accordance with this Section 4 and receipt of full payment of the aggregate Exercise Price and any applicable tax withholding amounts, the Company shall cause to be issued and delivered to Participant (or, in the case of a broker-assisted cashless exercise, to Participant's Broker) the number of Shares purchased, evidenced in book-entry form through the Company's transfer agent and registrar, Continental Share Services, Inc. Shares of Common Stock issued upon exercise of the Option shall be identified by CUSIP number 039217105. All Shares issued upon exercise of the Option shall be duly authorized, validly issued, fully paid, and non-assessable. The Company shall use commercially reasonable efforts to cause the Shares to be issued as promptly as practicable following receipt of a valid exercise notice and payment; provided, however, that the Company shall not be required to issue any Shares in violation of applicable law or the rules and regulations of the NYSE.

4.5 Fractional Shares. No fractional Shares shall be issued upon exercise of the Option. If any vesting or exercise calculation would result in a fractional Share, such fractional Share shall be rounded down to the nearest whole Share. No cash payment or other consideration shall be made in lieu of any fractional Share.

Section 5. Term and Expiration

5.1 Term. The Option shall have a term commencing on the Date of Grant and ending on the Expiration Date set forth in the Grant Notice (the "Term"), unless terminated earlier in accordance with Section 6 of this Agreement. In no event shall the Term exceed ten (10) years from the Date of Grant. Notwithstanding the foregoing, if the Option is designated as an Incentive Stock Option and Participant is, at the time of grant, a Ten Percent Stockholder (as defined in Section 7.5 below), the Term shall not exceed five (5) years from the Date of Grant.

5.2 Early Termination. The Option shall terminate prior to the Expiration Date in accordance with Section 6 of this Agreement upon termination of Participant's Continuous Service. Upon the expiration or termination of the Option, all rights of Participant under this Agreement with respect to any unexercised portion of the Option shall immediately cease and terminate, and such unexercised portion shall be cancelled and forfeited without consideration.

Section 6. Termination of Service

6.1 Termination Without Cause (Other Than Death or Disability). If Participant's Continuous Service with the Company or any subsidiary terminates for any reason other than Cause, death, or Disability (including, without limitation, voluntary resignation, retirement, or termination by the Company without Cause), the vested and unexercised portion of the Option as of the date of such termination may be exercised by Participant (or Participant's legal guardian or representative) for a period of ninety (90) days following the date of termination of Continuous Service (the "Post-Termination Exercise Period"); provided, however, that in no event shall the Option be exercisable after the Expiration Date. The unvested portion of the Option as of the date of termination of Continuous Service shall immediately and automatically terminate and be forfeited without consideration as of such date, and Participant shall have no further right, title, or interest in or to such unvested portion.

6.2 Termination for Cause. If Participant's Continuous Service is terminated by the Company or any subsidiary for Cause, the entire Option (including both the vested and unvested portions) shall immediately and automatically terminate and be forfeited without consideration as of the date of such termination. Participant shall have no further right to exercise any portion of the Option following a termination for Cause. For the avoidance of doubt, if the Company determines, after Participant's termination of Continuous Service, that Participant's conduct during employment or service would have constituted Cause, the Committee may, in its sole discretion, retroactively terminate the Option and require Participant to repay to the Company any gains realized from the exercise of the Option after the date of the conduct giving rise to such Cause determination, in accordance with the Company's clawback policy described in Section 14 of this Agreement.

6.3 Death. If Participant dies while in Continuous Service with the Company or any subsidiary, or if Participant dies during the Post-Termination Exercise Period described in Section 6.1, the vested and unexercised portion of the Option as of the date of Participant's death may be exercised by Participant's estate, designated beneficiary (if permitted under the Plan and applicable law), or the person or persons to whom the Option is transferred by will or the laws of descent and distribution, for a period of twelve (12) months following the date of Participant's death; provided, however, that in no event shall the Option be exercisable after the Expiration Date. The unvested portion of the Option as of the date of Participant's death shall immediately and automatically terminate and be forfeited without consideration as of such date.

6.4 Disability. If Participant's Continuous Service with the Company or any subsidiary terminates as a result of Participant's Disability, the vested and unexercised portion of the Option as of the date of such termination may be exercised by Participant (or Participant's legal guardian or representative) for a period of twelve (12) months following the date of termination of Continuous Service due to Disability; provided, however, that in no event shall the Option be exercisable after the Expiration Date. The unvested portion of the Option as of the date of termination of Continuous Service due to Disability shall immediately and automatically terminate and be forfeited without consideration as of such date.

6.5 Resignation. If Participant voluntarily resigns from Continuous Service with the Company or any subsidiary (other than for Good Reason, if applicable and as defined herein), the treatment of the Option shall be as set forth in Section 6.1 above (i.e., a ninety (90)-day Post-Termination Exercise Period for the vested and unexercised portion of the Option, and immediate forfeiture of the unvested portion). If Participant's resignation constitutes a resignation for Good Reason (to the extent Good Reason is defined and applicable pursuant to a written agreement between the Company and Participant), the treatment of the Option shall be as set forth in such written agreement or, absent specific provisions therein, as set forth in Section 6.1 above.

6.6 Leave of Absence. A leave of absence approved in writing by the Company (or that is otherwise required to be granted under applicable law) shall not be treated as a termination of Continuous Service for purposes of this Agreement; provided, however, that vesting of the Option may be suspended during any such leave of absence to the extent provided in the Plan or as otherwise required by applicable law. For purposes of Incentive Stock Options, if Participant's leave of absence exceeds three (3) months and Participant's right to reemployment is not guaranteed by statute or contract, Participant's Continuous Service shall be deemed to have terminated on the first day following the expiration of such three-month period, and the Option shall thereafter be treated as a Non-Qualified Stock Option to the extent it is exercised more than three (3) months after such deemed termination date. The Committee shall have sole discretion to determine whether a particular leave of absence constitutes a termination of Continuous Service for purposes of the Plan and this Agreement, subject to applicable law.

Section 7. Incentive Stock Option Provisions

7.1 Applicability. The provisions of this Section 7 shall apply only if the Option is designated as an Incentive Stock Option in the Grant Notice. The treatment of the Option as an Incentive Stock Option is subject to, and conditioned upon, compliance with the requirements of Section 422 of the Code and the regulations promulgated thereunder. To the extent that the Option (or any portion thereof) does not qualify as an Incentive Stock Option for any reason (including, without limitation, by reason of the provisions of this Section 7), such Option (or the non-qualifying portion thereof) shall automatically be treated as a Non-Qualified Stock Option.

7.2 $100,000 Limitation. To the extent that the aggregate Fair Market Value (determined as of the Date of Grant) of shares of Common Stock with respect to which Incentive Stock Options (under all plans of the Company and its parent and subsidiary corporations, within the meaning of Sections 424(e) and 424(f) of the Code) first become exercisable by Participant during any calendar year exceeds One Hundred Thousand Dollars ($100,000), such excess Incentive Stock Options shall be treated as Non-Qualified Stock Options. For purposes of the foregoing limitation, Incentive Stock Options shall be taken into account in the order in which they were granted, and the Fair Market Value of the shares shall be determined as of the time the Incentive Stock Option with respect to such shares is granted.

7.3 Disqualifying Dispositions. If Participant disposes of any shares of Common Stock acquired upon the exercise of an Incentive Stock Option within two (2) years from the Date of Grant or within one (1) year from the date of exercise of the Option (a "Disqualifying Disposition"), Participant shall immediately notify the Company in writing of such disposition. Participant acknowledges and agrees that a Disqualifying Disposition may cause Participant to recognize ordinary income for federal income tax purposes in an amount equal to the excess of (a) the amount realized on such disposition (or, in the case of a disposition that is not a sale or exchange, the Fair Market Value of the shares on the date of disposition) over (b) the Exercise Price of such shares, and that the Company may be entitled to a corresponding federal income tax deduction. Participant further acknowledges that the Company may withhold from Participant's compensation, or require Participant to remit, an amount sufficient to satisfy any tax withholding obligations arising from a Disqualifying Disposition.

7.4 Post-Termination ISO Exercise Period. Notwithstanding the provisions of Sections 6.1, 6.3, and 6.4 of this Agreement, if the Option is designated as an Incentive Stock Option and Participant exercises the Option more than three (3) months after the date of termination of Participant's employment with the Company or any subsidiary (or more than twelve (12) months after such termination, in the case of termination due to Disability), the Option shall be treated as a Non-Qualified Stock Option to the extent exercised after such period, except that the foregoing three-month limitation shall not apply in the event of Participant's death. For purposes of this Section 7.4, "employment" means employment as an employee (and not merely service as a director or consultant), in accordance with the requirements of Section 422 of the Code.

7.5 Ten Percent Stockholders. If Participant is, at the time of grant of the Option, a person who owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or of any parent or subsidiary corporation (within the meaning of Section 422(b)(6) of the Code) (a "Ten Percent Stockholder"), the following additional requirements shall apply to the Option:

(a) The Exercise Price per Share shall not be less than one hundred ten percent (110%) of the Fair Market Value of a share of Common Stock on the Date of Grant.

(b) The Term of the Option shall not exceed five (5) years from the Date of Grant.

7.6 No Guarantee of ISO Treatment. The Company does not represent, warrant, or guarantee that the Option will qualify as, or will continue to be treated as, an Incentive Stock Option under Section 422 of the Code. Participant acknowledges that the tax treatment of the Option depends on a number of factors and circumstances, many of which are outside the control of the Company, and that the characterization of the Option as an Incentive Stock Option may be affected by future changes in law, regulations, or administrative guidance. Participant is solely responsible for determining the tax consequences of the Option and should consult with Participant's own tax advisor regarding the same.

Section 8. Tax Matters

8.1 Tax Withholding Obligation. As a condition precedent to the exercise of the Option (in whole or in part), Participant shall make arrangements satisfactory to the Company for the satisfaction of all applicable federal, state, and local income tax withholding obligations and employment tax withholding obligations (including, without limitation, obligations for Federal Insurance Contributions Act (FICA) taxes and federal and state unemployment taxes) arising from or in connection with the exercise of the Option. The Company shall have the right, but not the obligation, to withhold from any compensation or other amounts owing from the Company to Participant (including, without limitation, salary, wages, bonuses, or other compensation), or to require Participant to remit to the Company, an amount sufficient to satisfy all applicable withholding obligations. The Company shall not be required to issue any Shares upon exercise of the Option until all applicable withholding obligations have been satisfied.

8.2 Methods of Satisfying Withholding. The withholding obligation described in Section 8.1 may be satisfied, at the election of Participant and subject to the approval of the Committee, by one or a combination of the following methods:

(a) Payment to the Company in cash (including by check, wire transfer, or other immediately available funds) of an amount equal to the applicable withholding obligation.

(b) Withholding from Participant's wages, salary, bonus, or other cash compensation payable by the Company to Participant, in an amount equal to the applicable withholding obligation.

(c) Withholding of Shares of Common Stock otherwise issuable to Participant upon exercise of the Option (a "net share settlement"), with such withheld Shares valued at their Fair Market Value on the date of exercise. The number of Shares so withheld shall not exceed the number of Shares having a Fair Market Value equal to the applicable withholding obligation calculated using the maximum statutory withholding rates for federal, state, and local tax purposes (including payroll taxes) that are applicable to Participant's supplemental taxable income, or such lesser rate as the Committee may determine is necessary to avoid adverse accounting consequences.

(d) Such other method as the Committee may approve in its sole discretion, consistent with the terms of the Plan and applicable law.

8.3 Section 409A. The Option is intended to be exempt from the application of Section 409A of the Code pursuant to Treasury Regulation Section 1.409A-1(b)(5)(i) (relating to stock options granted at fair market value), and this Agreement shall be construed and interpreted accordingly. In no event shall the Exercise Price per Share be less than the Fair Market Value of a share of Common Stock on the Date of Grant, as determined in accordance with the Plan and in a manner consistent with Section 409A of the Code and Treasury Regulation Section 1.409A-1(b)(5)(iv). The Company makes no representation, warranty, or guarantee regarding the tax treatment of the Option under Section 409A of the Code or any other provision of the Code, and shall not be liable to Participant for any taxes, penalties, or interest that may be imposed under Section 409A.

8.4 Tax Advice. Participant acknowledges that the Company has not provided Participant with any tax advice regarding the Option, and Participant is hereby advised to consult with Participant's own qualified tax advisor regarding the federal, state, local, and foreign tax consequences of the grant, vesting, exercise, and disposition of the Option and any Shares acquired upon exercise thereof. Without limiting the generality of the foregoing, Participant is advised to consult with Participant's tax advisor regarding the potential applicability of the alternative minimum tax ("AMT") in connection with the exercise of an Incentive Stock Option, the tax consequences of a Disqualifying Disposition (as described in Section 7.3), and the availability and advisability of filing an election under Section 83(b) of the Code in the event that the Option is exercised with respect to unvested Shares (if early exercise is permitted under the terms of this Agreement or the Grant Notice). Participant acknowledges that a Section 83(b) election, to the extent applicable, must be filed with the Internal Revenue Service within thirty (30) days of the date of exercise with respect to unvested Shares, and that Participant is solely responsible for timely making such election if Participant determines it to be appropriate.

8.5 Section 162(m). Participant acknowledges that certain compensation of "covered employees" (as defined in Section 162(m) of the Code) may not be deductible by the Company for federal income tax purposes. The Committee may, in its sole discretion, take into account the limitations imposed by Section 162(m) in connection with the grant, vesting, or exercise of the Option and the design of compensation arrangements generally. Nothing in this Agreement shall be construed to require the Company to structure the Option or any other compensation arrangement in a manner intended to qualify for an exemption from Section 162(m), and Participant shall have no claim against the Company in the event that compensation attributable to the Option is not deductible by the Company.

Section 9. Non-Transferability

9.1 General Restriction. Except as otherwise provided in this Section 9, the Option shall not be transferable by Participant other than by will or the laws of descent and distribution. During Participant's lifetime, the Option may be exercised only by Participant (or, in the event of Participant's legal incapacity, by Participant's duly appointed legal guardian or representative acting in a fiduciary capacity on behalf of Participant under court supervision). Any attempt to transfer, assign, pledge, hypothecate, or otherwise dispose of the Option in a manner not expressly permitted by this Agreement and the Plan shall be null, void, and of no effect.

9.2 NQSO Exception. Notwithstanding Section 9.1, if the Option is designated as a Non-Qualified Stock Option, the Committee may, in its sole discretion, permit the transfer of the Option (or any portion thereof) by Participant to one or more of the following transferees, provided that no consideration is paid in connection with such transfer:

(a) Members of Participant's immediate family (defined for this purpose as Participant's spouse, domestic partner, children, stepchildren, grandchildren, parents, stepparents, siblings, or any spouse or domestic partner of the foregoing);

(b) A trust for the primary benefit of one or more members of Participant's immediate family;

(c) A partnership, limited liability company, or other entity in which Participant and/or members of Participant's immediate family are the sole owners of all equity interests; or

(d) Such other transferees as the Committee may approve in writing.

Any such transfer shall be subject to the condition that the transferee executes a written instrument, in form and substance satisfactory to the Company, agreeing to be bound by all of the terms and conditions of this Agreement and the Plan. No transfer for value (including, without limitation, any sale, exchange, or other disposition for consideration) shall be permitted under any circumstances. The Company shall not be required to recognize or give effect to any purported transfer of the Option that does not comply with the requirements of this Section 9.2.

9.3 No Assignment. No rights under this Agreement may be pledged, alienated, attached, garnished, or otherwise encumbered, and any attempt to pledge, alienate, attach, garnish, or otherwise encumber the Option or any rights hereunder shall be null, void, and without effect. No right or interest of Participant under this Agreement shall be subject to the debts, contracts, or liabilities of Participant, or be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment, or any other means, whether voluntary or involuntary or by operation of law.

Section 10. Lock-Up Restriction

10.1 Lock-Up. Participant acknowledges and agrees that any shares of Common Stock acquired upon exercise of the Option may be subject to a lock-up agreement entered into by Participant in connection with the Company's initial public offering (the "IPO Lock-Up Agreement"), which restricts the sale, transfer, pledge, or other disposition of such shares for a period of one hundred eighty (180) days following the date of the final prospectus relating to the IPO (i.e., from February 8, 2024, through and including August 6, 2024), in favor of Whitfield Barrow & Co., LLC, as Representative of the underwriters in the Company's initial public offering. Participant agrees to comply with the terms of any such IPO Lock-Up Agreement to which Participant is a party. The Company may instruct its transfer agent, Continental Share Services, Inc., to impose stop-transfer restrictions on Shares held by Participant during the period of the lock-up.

10.2 Market Stand-Off. Notwithstanding whether Participant has entered into a separate lock-up agreement in connection with the IPO or otherwise, Participant hereby agrees that, upon the request of the Company or the managing underwriter(s) in connection with any public offering of the Company's equity securities (whether the IPO or any subsequent offering), Participant shall not, directly or indirectly, sell, offer to sell, contract to sell, make any short sale of, grant any option for the purchase of, pledge, hypothecate, or otherwise transfer or dispose of any Shares acquired upon exercise of the Option (or any securities convertible into or exercisable or exchangeable for Shares), or enter into any hedging, swap, or similar transaction that transfers, in whole or in part, any of the economic consequences of ownership of such Shares, for such period of time (not to exceed one hundred eighty (180) days, or such shorter period as may be agreed upon by the Company and the managing underwriter(s)) following the effective date of the applicable registration statement as may be requested by the Company or the managing underwriter(s). The Company may impose stop-transfer instructions with respect to such Shares until the end of any such market stand-off period. Participant agrees to execute such further agreements and instruments as may be reasonably required to effectuate the provisions of this Section 10.2. This market stand-off obligation shall apply to the Company's initial public offering and to any subsequent public offering of the Company's equity securities, as the Committee may determine in its sole discretion.

Section 11. Adjustments

11.1 Capital Adjustments. In the event of any stock split, reverse stock split, stock dividend, recapitalization, combination, reclassification, or similar change in the capital structure of the Company (whether effected without consideration or otherwise), the Committee shall make appropriate and proportionate adjustments to (a) the number and class of shares of Common Stock (or other securities) subject to the Option, and (b) the Exercise Price per Share, in each case in accordance with the adjustment provisions of the Plan, so as to preserve the economic value of the Option. Any such adjustment shall be made by the Committee in its sole discretion, and the Committee's determination shall be final, binding, and conclusive. No fractional shares shall be issued as a result of any such adjustment; any fractional share resulting from such adjustment shall be rounded down to the nearest whole share.

11.2 Change in Control. Upon the occurrence of a Change in Control (as defined in the Plan), the Option shall be treated in accordance with the applicable provisions of the Plan governing corporate transactions and changes in control. Without limiting the generality of the foregoing, the Plan provides that in connection with a Change in Control, the Committee (or the board of directors of any surviving or acquiring entity) may, in its sole discretion, take one or more of the following actions with respect to the Option:

(a) Provide for the assumption or substitution of the Option by the surviving or acquiring entity (or a parent thereof) on substantially equivalent terms;

(b) Provide for the accelerated vesting and exercisability of the Option, in whole or in part, for a specified period prior to the consummation of the Change in Control, with the Option terminating upon consummation of such Change in Control to the extent not exercised;

(c) Provide for the cancellation of the Option in exchange for a cash payment, shares of the surviving or acquiring entity, or other consideration, in an amount equal to the excess, if any, of the Fair Market Value of the Shares subject to the Option (or the per-share consideration received by holders of Common Stock in connection with the Change in Control) over the Exercise Price of such Shares; or

(d) Take such other action as the Committee deems appropriate and consistent with the Plan.

The specific treatment of the Option in connection with a Change in Control may also be governed by a separate written agreement between the Company and Participant (such as a change in control severance agreement or employment agreement), to the extent such agreement provides for specific treatment of equity awards in connection with a Change in Control.

Section 12. Rights as Stockholder

Participant shall not be deemed to be a stockholder of the Company, and shall have no rights as a stockholder of the Company (including, without limitation, the right to vote shares of Common Stock, to receive dividends or other distributions with respect thereto, or to exercise any preemptive or other subscription rights), with respect to any Shares subject to the Option until such Shares have been validly issued and recorded on the books of the Company (or its transfer agent, Continental Share Services, Inc.) following a valid exercise of the Option in accordance with this Agreement and the Plan, full payment of the aggregate Exercise Price and any applicable tax withholding amounts, and compliance with all applicable securities laws and regulations. No adjustment shall be made for dividends, distributions, or other rights for which the record date is prior to the date of issuance and recording of such Shares.

Section 13. Compliance with Law

13.1 Securities Law Compliance. The grant of the Option and the issuance of Shares upon exercise of the Option are subject to compliance with all applicable federal and state securities laws, rules, and regulations. The Company shall not be required to issue or deliver any Shares upon exercise of the Option if, in the opinion of counsel to the Company, such issuance or delivery would violate any applicable federal or state securities law, rule, or regulation, including, without limitation, the Securities Act of 1933, as amended (the "Securities Act"), or the rules and regulations of the NYSE. The Company may require, as a condition to the issuance of Shares, that Participant make such representations, warranties, and agreements as the Company may deem necessary or advisable in order to comply with applicable securities laws, including (without limitation) a representation that the Shares are being acquired for investment and not with a view to distribution.

13.2 Restrictive Legends. Certificates (if any) or book-entry notations for Shares issued upon exercise of the Option may bear such restrictive legends, notations, or stop-transfer instructions as the Company and its counsel (Calderwood & Harkness LLP or successor counsel) deem necessary or advisable under applicable federal and state securities laws, including, without limitation:

(a) A legend reflecting restrictions on transfer under the Securities Act (e.g., to the effect that the Shares have not been registered under the Securities Act and may not be offered, sold, or otherwise disposed of without registration or an applicable exemption from registration);

(b) A legend reflecting the lock-up and market stand-off restrictions described in Section 10 of this Agreement; and

(c) Such other legends or notations as the Company or its counsel may deem necessary or advisable in connection with applicable state "blue sky" laws or the rules and regulations of the NYSE.

Such legends or notations shall be removed only upon compliance with applicable securities laws and Company policies, as determined by the Company and its counsel.

13.3 Insider Trading Policy. Participant acknowledges that Participant has received, reviewed, and agrees to comply with the Company's Insider Trading Compliance Policy (as may be amended, restated, or supplemented from time to time) (the "Insider Trading Policy"), including, without limitation, any applicable blackout periods, quarterly trading windows, and pre-clearance requirements applicable to transactions in the Company's securities. Participant acknowledges that the exercise of the Option and the sale of Shares acquired upon exercise may be subject to the restrictions and requirements of the Insider Trading Policy, Section 16 of the Securities Exchange Act of 1934, as amended (if applicable), Rule 10b-5 thereunder, and Regulation BTR promulgated by the Securities and Exchange Commission. Participant agrees that Participant shall not exercise the Option or sell any Shares acquired upon exercise during any period in which such exercise or sale would violate the Insider Trading Policy or applicable securities laws.

Section 14. Clawback / Recoupment

The Option and any Shares acquired upon exercise of the Option, and any proceeds, gains, or other economic benefit actually or constructively received by Participant upon the exercise or disposition of the Option or the sale of Shares acquired upon exercise, shall be subject to any clawback, recoupment, forfeiture, disgorgement, or similar policy or agreement adopted by the Company from time to time, including, without limitation, any policy adopted by the Company to comply with (a) the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act"), (b) Rule 10D-1 under the Securities Exchange Act of 1934, as amended, (c) the NYSE Listed Company Manual Section 303A.14 and applicable listing standards regarding recovery of erroneously awarded compensation, and (d) any other applicable law, rule, or regulation. Participant acknowledges and agrees that the Company may, to the extent required or permitted by any such policy, applicable law, or regulation, require the forfeiture, repayment, reimbursement, or recoupment of the Option, any Shares acquired upon exercise, and/or any gains or proceeds realized from the exercise or disposition of the Option, and Participant agrees to promptly comply with any such requirement. By accepting the Option, Participant consents to and agrees to be bound by the terms of any such clawback or recoupment policy, as it may be adopted or amended from time to time.

Section 15. Data Privacy

Participant hereby acknowledges, understands, and consents to the collection, use, processing, storage, and transfer (including cross-border transfer) of certain personal data by and among the Company, its subsidiaries and affiliates, and the Company's agents, representatives, and service providers (including, without limitation, Continental Share Services, Inc., as the Company's transfer agent, any stock plan administration service provider, and any broker designated by the Company for purposes of cashless exercises) as may be necessary or appropriate for the administration of this Agreement and the Plan. Such personal data may include, without limitation, Participant's name, home address, email address, telephone number, date of birth, social security number or other tax identification number, employee identification number, salary, nationality, job title, information regarding the Option (including the Date of Grant, Exercise Price, vesting schedule, and exercise history), and any other information necessary for the implementation, administration, and management of the Plan.

Participant understands that such data may be transferred to and processed in jurisdictions outside Participant's country of residence, including the United States, where data privacy laws may not provide the same level of protection as the laws in Participant's country of residence. Participant consents to any such transfer and processing and agrees that the Company and its agents may retain such data for as long as reasonably necessary for the purposes described herein. Participant understands that Participant may, at any time, review Participant's personal data, request a correction to it, or withdraw Participant's consent herein by contacting the Company in writing; provided, however, that such withdrawal of consent may affect Participant's ability to participate in the Plan.

Section 16. Notices

All notices, requests, demands, and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given when (a) delivered personally (with written confirmation of receipt), (b) sent by certified or registered mail, return receipt requested, postage prepaid, (c) sent by nationally recognized overnight courier service (with written confirmation of delivery), or (d) sent by email (with confirmation of transmission and no bounce-back or delivery failure notification), addressed as follows:

If to the Company:

Arbor Health Technologies Inc. 275 Kendall Avenue, Suite 1400 Cambridge, MA 02142

Attention: General Counsel

Email: legal@arborhealth.com

If to Participant:

At the address set forth in the Grant Notice, or at such other address as Participant may designate by written notice to the Company in accordance with this Section 16.

Notices delivered personally shall be effective upon delivery. Notices sent by certified or registered mail shall be effective five (5) business days after deposit in the United States mail. Notices sent by overnight courier shall be effective one (1) business day after deposit with such courier. Notices sent by email shall be effective upon confirmation of transmission; provided, however, that any notice of exercise of the Option must be delivered in accordance with Section 4.1 and the procedures established by the Company from time to time.

Section 17. Entire Agreement; Amendment

17.1 Entire Agreement. This Agreement (including the Grant Notice to which this Agreement is attached, and all appendices hereto) and the Plan constitute the entire agreement between the Company and Participant with respect to the subject matter hereof and supersede all prior and contemporaneous agreements, understandings, negotiations, discussions, representations, and warranties, whether oral or written, relating to such subject matter. No oral or written representation, warranty, or agreement not expressly set forth in this Agreement or the Plan shall be binding upon either party.

17.2 Amendment. This Agreement may not be amended, modified, or supplemented in any respect except by a written instrument executed by both the Company (acting through the Committee or an authorized officer) and Participant, or as otherwise expressly permitted under the Plan. Notwithstanding the foregoing, the Committee may amend the Plan or this Agreement unilaterally, without Participant's prior written consent, if such amendment (a) is required by applicable law, rule, or regulation (including, without limitation, Section 409A of the Code or the rules and regulations of the NYSE), or (b) does not materially and adversely affect Participant's rights under this Agreement, as determined by the Committee in good faith.

Section 18. Governing Law; Jurisdiction

18.1 Governing Law. This Agreement shall be governed by, and construed and interpreted in accordance with, the internal substantive laws of the State of Delaware, without giving effect to any choice-of-law or conflict-of-law rules or principles that would cause the application of the laws of any other jurisdiction.

18.2 Jurisdiction. Any action, suit, or proceeding arising out of, relating to, or in connection with this Agreement or the transactions contemplated hereby shall be brought exclusively in the Court of Chancery of the State of Delaware (or, if the Court of Chancery declines to accept jurisdiction over a particular matter, the Superior Court of the State of Delaware, or, if subject matter jurisdiction over the matter is vested exclusively in the federal courts, the United States District Court for the District of Delaware) (collectively, the "Delaware Courts"). Each of the Company and Participant hereby irrevocably submits to the exclusive jurisdiction of the Delaware Courts for purposes of any such action, suit, or proceeding, and each party hereby irrevocably waives, and agrees not to assert, by way of motion, as a defense, or otherwise, (a) any claim that such party is not subject to personal jurisdiction in the Delaware Courts, (b) any objection that such party may now or hereafter have to the laying of venue of any such action, suit, or proceeding in any Delaware Court, and (c) any claim that any such action, suit, or proceeding brought in any Delaware Court has been brought in an inconvenient forum.

Section 19. Severability

If any provision of this Agreement is held to be invalid, illegal, or unenforceable in any respect under any applicable law, rule, or regulation or by any court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision hereof, and this Agreement shall be reformed, construed, and enforced as if such invalid, illegal, or unenforceable provision had never been contained herein. To the extent permitted by applicable law, each party hereto waives any provision of law that renders any provision of this Agreement invalid, illegal, or unenforceable in any respect.

Section 20. Waiver

No waiver by the Company of any breach of, or failure to comply with, any provision of this Agreement by Participant shall operate as or be construed as a waiver of any other or subsequent breach of, or failure to comply with, the same or any other provision of this Agreement. No waiver shall be effective unless it is in writing and signed by an authorized representative of the Company. The failure of the Company to insist upon strict compliance with any provision of this Agreement shall not constitute a waiver of the Company's right to demand strict compliance thereafter.

Section 21. Successors and Assigns

This Agreement shall be binding upon and shall inure to the benefit of the Company and its successors and assigns (including, without limitation, any successor by merger, consolidation, reorganization, or similar corporate transaction, or any entity that acquires all or substantially all of the Company's assets or business). Subject to the restrictions on transfer set forth in Section 9 of this Agreement, this Agreement shall be binding upon and shall inure to the benefit of Participant and Participant's heirs, legatees, executors, administrators, personal representatives, and permitted assigns. The Company may assign its rights and obligations under this Agreement to any successor entity without the consent of Participant, and the successor entity shall be substituted for the Company for all purposes under this Agreement.

Section 22. Electronic Delivery and Acceptance

The Company may, in its sole discretion, deliver any documents related to this Agreement, the Grant Notice, the Plan, and any future awards or grants under the Plan by electronic means, including by e-mail, by posting on an internal website or intranet maintained by the Company, or through a third-party stock plan administration platform. Participant hereby consents to electronic delivery and agrees that Participant's electronic acceptance or electronic signature (including acceptance through a "click-through" or similar mechanism on a third-party stock plan administration platform) shall have the same force and effect as a manual, ink-original signature. Participant agrees that the Company may rely on such electronic acceptance or si

ARBOR HEALTH TECHNOLOGIES INC.
STOCK OPTION AGREEMENT
Under the 2024 Equity Incentive Plan
Form of Agreement for Incentive Stock Options and Non-Qualified Stock Options
This is a form of Stock Option Agreement for use in connection with grants of stock options under the Arbor Health Technologies Inc. 2024 Equity Incentive Plan (the "Plan"). This form is intended for use with both Incentive Stock Options ("ISOs") within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"), and Non-Qualified Stock Options ("NQSOs"). Bracketed placeholders indicate fields to be completed at the time of grant. This form has been prepared by Calderwood & Harkness LLP, outside counsel to the Company, and should not be modified without prior review by the Company's General Counsel or outside counsel.
ARBOR HEALTH TECHNOLOGIES INC.
STOCK OPTION GRANT NOTICE
(2024 Equity Incentive Plan)
Arbor Health Technologies Inc., a Delaware corporation (the "Company"), hereby grants to the individual named below (the "Participant") an option (the "Option") to purchase the number of shares of common stock of the Company set forth below (the "Shares"), at the exercise price per share set forth below (the "Exercise Price"), subject to the terms and conditions set forth in this Stock Option Grant Notice (this "Grant Notice"), the Stock Option Agreement attached hereto as Exhibit A (the "Agreement"), and the Arbor Health Technologies Inc. 2024 Equity Incentive Plan (the "Plan").
PARTICIPANT INFORMATION:
GRANT DETAILS:
Note: The Exercise Price per Share must not be less than one hundred percent (100%) of the Fair Market Value of a share of common stock on the Date of Grant, as determined in accordance with the Plan. For Incentive Stock Options granted to a Participant who, at the time of grant, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any parent or subsidiary corporation (a "Ten Percent Stockholder"), the Exercise Price per Share must not be less than one hundred ten percent (110%) of the Fair Market Value on the Date of Grant. The Expiration Date shall not be later than ten (10) years from the Date of Grant; provided, however, that for Incentive Stock Options granted to a Ten Percent Stockholder, the Expiration Date shall not be later than five (5) years from the Date of Grant.
VESTING SCHEDULE:
The Option shall vest and become exercisable in accordance with the following schedule, subject in each case to Participant's Continuous Service (as defined in the Plan) with the Company or any subsidiary through each applicable vesting date:
(a) Cliff Vesting: Twenty-five percent (25%) of the total number of Shares subject to the Option shall vest and become exercisable on the first anniversary of the Vesting Commencement Date (the "Cliff Date").
(b) Monthly Vesting: The remaining seventy-five percent (75%) of the total number of Shares subject to the Option shall vest and become exercisable in thirty-six (36) equal monthly installments following the Cliff Date, with each such installment vesting on the same day of each calendar month as the Cliff Date (or, if there is no such day in a given month, on the last day of such month), such that one hundred percent (100%) of the Shares subject to the Option shall be fully vested on the fourth anniversary of the Vesting Commencement Date, subject to Participant's Continuous Service through each such vesting date.
Note: If an alternative vesting schedule applies to Participant (whether pursuant to an employment agreement, offer letter, or other written arrangement approved by the Committee), such alternative vesting schedule shall be set forth below in lieu of the foregoing standard schedule:
[Insert modified vesting schedule, if applicable.]
VESTING TABLE:
PLAN REFERENCE:
This Option is granted under and governed by the terms and conditions of the Arbor Health Technologies Inc. 2024 Equity Incentive Plan (the "Plan"), which was adopted by the Board of Directors of the Company on January 15, 2024, and became effective upon the closing of the Company's initial public offering of its common stock on the New York Stock Exchange (the "NYSE") under the ticker symbol "ARHT." A copy of the Plan has been made available to Participant, and Participant acknowledges receipt thereof. Capitalized terms used but not otherwise defined in this Grant Notice or the Agreement shall have the meanings ascribed to such terms in the Plan.
AGREEMENT TO TERMS:
By signing below (or by accepting this grant electronically through the Company's designated equity administration platform), Participant acknowledges receipt of, and agrees to be bound by, (i) this Grant Notice, (ii) the Stock Option Agreement attached hereto as Exhibit A (including all appendices thereto), and (iii) the Plan. Participant further acknowledges that Participant has reviewed each of the foregoing documents and has had the opportunity to consult with Participant's own legal and tax advisors regarding the terms and consequences of this Option grant.
ARBOR HEALTH TECHNOLOGIES INC.
By: ________
Name: [Insert Authorized Officer Name]
Title: [Insert Title]
Address: 275 Kendall Avenue, Suite 1400
Cambridge, MA 02142
PARTICIPANT:
Signature: ________
Name: [Insert Participant Name]
Date: ________
EXHIBIT A
ARBOR HEALTH TECHNOLOGIES INC.
STOCK OPTION AGREEMENT
(2024 Equity Incentive Plan)
TERMS AND CONDITIONS
This Stock Option Agreement (together with the Grant Notice to which this Agreement is attached, this "Agreement") is entered into by and between Arbor Health Technologies Inc., a Delaware corporation (the "Company"), and the individual identified in the Grant Notice (the "Participant"), effective as of the Date of Grant set forth in the Grant Notice.
Section 1. Grant of Option
1.1 Grant. The Company hereby grants to Participant an option (the "Option") to purchase the number of shares of common stock, par value $0.001 per share, of the Company (the "Common Stock") set forth in the Stock Option Grant Notice (the "Grant Notice") to which this Agreement is attached, at the Exercise Price per Share set forth in the Grant Notice, and subject to the terms and conditions set forth in this Agreement and the Plan. The shares of Common Stock issuable upon exercise of the Option are sometimes referred to herein as the "Shares."
1.2 Type of Option. The Option is designated as either an Incentive Stock Option or a Non-Qualified Stock Option, as specified in the Grant Notice. If the Option is designated as an Incentive Stock Option, it is intended to qualify as an "incentive stock option" within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"), to the maximum extent permitted by law. To the extent that the Option does not so qualify, or ceases to so qualify, it shall be treated as a Non-Qualified Stock Option. If the Option is designated as a Non-Qualified Stock Option, it is not intended to qualify as an incentive stock option under Section 422 of the Code.
1.3 Incorporation of Plan. The Arbor Health Technologies Inc. 2024 Equity Incentive Plan (the "Plan") is incorporated herein by reference in its entirety and made a part of this Agreement. In the event of any conflict or inconsistency between the terms and conditions of this Agreement and those of the Plan, the terms and conditions of the Plan shall control and prevail. The Option is subject to all of the terms and conditions of the Plan, including the powers of the Committee (as defined below) set forth therein.
1.4 Share Reserve. Participant acknowledges that the Plan provides for a total share reserve of 10,300,000 shares of Common Stock, which represents approximately ten percent (10%) of the Company's post-IPO outstanding shares of 103,000,000 shares of Common Stock, subject to adjustment as provided in the Plan. The Option granted hereunder is made from such share reserve, subject to the terms and limitations of the Plan.
Section 2. Definitions
Capitalized terms used but not defined in this Agreement shall have the meanings ascribed to such terms in the Plan. The following terms shall have the meanings set forth below for purposes of this Agreement:
2.1 "Agreement" means this Stock Option Agreement, including the Grant Notice to which this Agreement is attached, and all appendices and exhibits hereto, as the same may be amended from time to time in accordance with the terms hereof.
2.2 "Board" means the Board of Directors of the Company.
2.3 "Cause" shall have the meaning ascribed to such term in the Plan; provided, however, that if Participant is a party to an employment agreement, consulting agreement, severance agreement, or other similar written agreement with the Company or any subsidiary that contains a definition of "Cause" (or a similar term), then "Cause" shall have the meaning set forth in such agreement, to the extent that such definition is more favorable to Participant.
2.4 "Code" means the Internal Revenue Code of 1986, as amended from time to time, and the rules, regulations, and guidance promulgated thereunder.
2.5 "Committee" means the Compensation Committee of the Board, or such other committee of the Board as may be designated by the Board to administer the Plan, or the Board itself if no such committee has been designated. To the extent required by applicable law, rule, or regulation (including Rule 16b-3 under the Securities Exchange Act of 1934, as amended), the Committee shall consist of two or more members of the Board, each of whom is a "non-employee director" within the meaning of Rule 16b-3.
2.6 "Continuous Service" shall have the meaning ascribed to such term in the Plan, which generally means uninterrupted service as an employee, director, or consultant of the Company or any subsidiary, as determined by the Committee in its sole discretion. A change in the capacity in which Participant renders service to the Company or a subsidiary (e.g., from employee to consultant) shall not constitute a termination of Continuous Service, provided that there is no interruption in such service.
2.7 "Disability" shall have the meaning ascribed to such term in the Plan. For purposes of Incentive Stock Options, "Disability" means a disability within the meaning of Section 22(e)(3) of the Code (i.e., the inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or that has lasted or can be expected to last for a continuous period of not less than 12 months).
2.8 "Exercise Price" means the per-share exercise price set forth in the Grant Notice, as adjusted from time to time in accordance with Section 11 of this Agreement and the Plan.
2.9 "Expiration Date" means the date set forth in the Grant Notice as the expiration date of the Option, as such date may be subject to earlier termination in accordance with Section 5 and Section 6 of this Agreement.
2.10 "Fair Market Value" shall have the meaning ascribed to such term in the Plan. As of the date hereof, Fair Market Value means the closing sales price of a share of Common Stock on the NYSE (ticker symbol: ARHT) on the relevant date, or if there are no sales on such date, on the last preceding trading day on which sales occurred. If the Common Stock is not listed on a national securities exchange at the relevant time, Fair Market Value shall be determined by the Committee in good faith in accordance with the Plan and Section 409A of the Code.
2.11 "Good Reason" shall have the meaning ascribed to such term in the Plan, or if Participant is a party to an employment agreement, consulting agreement, severance agreement, or other similar written agreement with the Company or any subsidiary that contains a definition of "Good Reason" (or a similar term), then "Good Reason" shall have the meaning set forth in such agreement.
Section 3. Vesting
3.1 Vesting Schedule. The Option shall vest and become exercisable in accordance with the vesting schedule set forth in the Grant Notice. Unless otherwise specified in the Grant Notice or in a separate written agreement between the Company and Participant approved by the Committee, the standard vesting schedule shall be as follows: twenty-five percent (25%) of the total number of Shares subject to the Option shall vest and become exercisable on the first anniversary of the Vesting Commencement Date (the "Cliff Date"), and the remaining seventy-five percent (75%) of the Shares shall vest and become exercisable in thirty-six (36) equal monthly installments thereafter, with each installment representing one forty-eighth (1/48th) of the total number of Shares subject to the Option. Full vesting shall occur on the fourth anniversary of the Vesting Commencement Date, subject to Participant's Continuous Service through each applicable vesting date.
3.2 Continuous Service Requirement. Vesting of the Option is contingent upon Participant's Continuous Service with the Company or any subsidiary through each applicable vesting date. If Participant's Continuous Service terminates for any reason, vesting of the Option shall immediately cease, and no further Shares shall vest after the date of such termination. No partial vesting credit shall be given for any period of Continuous Service that is less than a full vesting increment (i.e., less than the one-year cliff period for the initial tranche, or less than a full calendar month for subsequent monthly tranches). For the avoidance of doubt, if Participant's Continuous Service terminates on a date that falls between two monthly vesting dates, Participant shall not receive vesting credit for the partial month in which such termination occurs.
3.3 Acceleration. Unless otherwise provided in a written agreement between the Company and Participant (including, without limitation, an employment agreement, offer letter, change in control severance agreement, or other arrangement approved by the Committee), there shall be no automatic acceleration of vesting of the Option upon a Change in Control (as defined in the Plan) or upon any other event. Any acceleration of vesting shall be subject to the terms and conditions of the Plan and any applicable written agreement between the Company and Participant, as approved by the Committee in its sole discretion. For the avoidance of doubt, the Committee retains full discretion under the Plan to provide for acceleration of vesting in connection with a Change in Control or other corporate transaction, subject to the terms and conditions of the Plan.
3.4 No Right to Continued Service. Nothing in this Agreement, the Grant Notice, or the Plan shall confer upon Participant any right to continue as an employee, director, or consultant of the Company or any subsidiary, or shall interfere with or restrict in any way the right of the Company or any subsidiary to terminate Participant's Continuous Service at any time, with or without Cause, subject to applicable law and the terms of any written employment agreement or consulting agreement between Participant and the Company or any subsidiary.
Section 4. Exercise of Option
4.1 Method of Exercise. Subject to the terms and conditions of this Agreement and the Plan, the vested and unexercised portion of the Option may be exercised, in whole or in part, at any time and from time to time during the period beginning on the date such portion becomes vested and ending on the earlier of (a) the Expiration Date or (b) the date the Option terminates in accordance with Section 6 of this Agreement. To exercise the Option, Participant shall deliver to the Company (or its designee, including any stock plan administrator or broker designated by the Company) a written notice of exercise in the form attached hereto as Appendix A (or in such other form as may be prescribed by the Committee from time to time), or an electronic notice of exercise submitted through the Company's designated equity administration platform, specifying the number of Shares to be purchased and the method of payment of the aggregate Exercise Price. Such notice shall be accompanied by payment of the aggregate Exercise Price for the Shares being purchased and payment (or arrangement for payment) of any applicable tax withholding amounts, as described in Section 8 of this Agreement.
4.2 Minimum Exercise. Unless the total number of vested and unexercised Shares is less, the minimum number of Shares for which the Option may be exercised at any one time shall be one hundred (100) Shares. The Committee may, in its sole discretion, waive or modify this minimum exercise requirement.
4.3 Forms of Payment. The aggregate Exercise Price for the Shares being purchased upon exercise of the Option may be paid by one or a combination of the following methods, as permitted by the Committee in its sole discretion:
(a) Cash or Check. Payment by cash, cashier's check, money order, or personal check payable to the order of the Company, in an amount equal to the aggregate Exercise Price for the Shares being purchased.
(b) Broker-Assisted Cashless Exercise. A "cashless" exercise through a simultaneous sale and remittance procedure pursuant to which Participant shall concurrently provide irrevocable instructions to (i) a broker or dealer designated or approved by the Company (the "Broker") to effect the immediate sale of the Shares being purchased (or a sufficient number thereof) in the open market, and (ii) the Broker to remit to the Company, out of the sale proceeds, an amount equal to the aggregate Exercise Price for the Shares being purchased plus any applicable tax withholding amounts. Such sale and remittance shall be effected on a same-day basis or as promptly as practicable following the date of exercise.
(c) Net Exercise / Share Withholding. A "net exercise" procedure pursuant to which the Company shall reduce the number of Shares otherwise issuable upon exercise by a number of Shares having a Fair Market Value on the date of exercise equal to the aggregate Exercise Price for the Shares being purchased (and, if approved by the Committee, any applicable tax withholding amounts). This method of payment shall be available only with the prior approval of the Committee, in its sole discretion.
(d) Previously Owned Shares. Delivery (either by actual delivery or attestation) of shares of Common Stock already owned by Participant that have been held by Participant for at least six (6) months (or such other period as may be required by the Committee to avoid adverse accounting treatment under applicable accounting standards), with a Fair Market Value on the date of exercise equal to the aggregate Exercise Price for the Shares being purchased. Such previously owned shares shall be free and clear of any liens, claims, encumbrances, or security interests.
(e) Other Methods. Such other consideration or method of payment as the Committee may permit, in its sole discretion, consistent with the terms of the Plan and applicable law.
4.4 Issuance of Shares. Upon valid exercise of the Option in accordance with this Section 4 and receipt of full payment of the aggregate Exercise Price and any applicable tax withholding amounts, the Company shall cause to be issued and delivered to Participant (or, in the case of a broker-assisted cashless exercise, to Participant's Broker) the number of Shares purchased, evidenced in book-entry form through the Company's transfer agent and registrar, Continental Share Services, Inc. Shares of Common Stock issued upon exercise of the Option shall be identified by CUSIP number 039217105. All Shares issued upon exercise of the Option shall be duly authorized, validly issued, fully paid, and non-assessable. The Company shall use commercially reasonable efforts to cause the Shares to be issued as promptly as practicable following receipt of a valid exercise notice and payment; provided, however, that the Company shall not be required to issue any Shares in violation of applicable law or the rules and regulations of the NYSE.
4.5 Fractional Shares. No fractional Shares shall be issued upon exercise of the Option. If any vesting or exercise calculation would result in a fractional Share, such fractional Share shall be rounded down to the nearest whole Share. No cash payment or other consideration shall be made in lieu of any fractional Share.
Section 5. Term and Expiration
5.1 Term. The Option shall have a term commencing on the Date of Grant and ending on the Expiration Date set forth in the Grant Notice (the "Term"), unless terminated earlier in accordance with Section 6 of this Agreement. In no event shall the Term exceed ten (10) years from the Date of Grant. Notwithstanding the foregoing, if the Option is designated as an Incentive Stock Option and Participant is, at the time of grant, a Ten Percent Stockholder (as defined in Section 7.5 below), the Term shall not exceed five (5) years from the Date of Grant.
5.2 Early Termination. The Option shall terminate prior to the Expiration Date in accordance with Section 6 of this Agreement upon termination of Participant's Continuous Service. Upon the expiration or termination of the Option, all rights of Participant under this Agreement with respect to any unexercised portion of the Option shall immediately cease and terminate, and such unexercised portion shall be cancelled and forfeited without consideration.
Section 6. Termination of Service
6.1 Termination Without Cause (Other Than Death or Disability). If Participant's Continuous Service with the Company or any subsidiary terminates for any reason other than Cause, death, or Disability (including, without limitation, voluntary resignation, retirement, or termination by the Company without Cause), the vested and unexercised portion of the Option as of the date of such termination may be exercised by Participant (or Participant's legal guardian or representative) for a period of ninety (90) days following the date of termination of Continuous Service (the "Post-Termination Exercise Period"); provided, however, that in no event shall the Option be exercisable after the Expiration Date. The unvested portion of the Option as of the date of termination of Continuous Service shall immediately and automatically terminate and be forfeited without consideration as of such date, and Participant shall have no further right, title, or interest in or to such unvested portion.
6.2 Termination for Cause. If Participant's Continuous Service is terminated by the Company or any subsidiary for Cause, the entire Option (including both the vested and unvested portions) shall immediately and automatically terminate and be forfeited without consideration as of the date of such termination. Participant shall have no further right to exercise any portion of the Option following a termination for Cause. For the avoidance of doubt, if the Company determines, after Participant's termination of Continuous Service, that Participant's conduct during employment or service would have constituted Cause, the Committee may, in its sole discretion, retroactively terminate the Option and require Participant to repay to the Company any gains realized from the exercise of the Option after the date of the conduct giving rise to such Cause determination, in accordance with the Company's clawback policy described in Section 14 of this Agreement.
6.3 Death. If Participant dies while in Continuous Service with the Company or any subsidiary, or if Participant dies during the Post-Termination Exercise Period described in Section 6.1, the vested and unexercised portion of the Option as of the date of Participant's death may be exercised by Participant's estate, designated beneficiary (if permitted under the Plan and applicable law), or the person or persons to whom the Option is transferred by will or the laws of descent and distribution, for a period of twelve (12) months following the date of Participant's death; provided, however, that in no event shall the Option be exercisable after the Expiration Date. The unvested portion of the Option as of the date of Participant's death shall immediately and automatically terminate and be forfeited without consideration as of such date.
6.4 Disability. If Participant's Continuous Service with the Company or any subsidiary terminates as a result of Participant's Disability, the vested and unexercised portion of the Option as of the date of such termination may be exercised by Participant (or Participant's legal guardian or representative) for a period of twelve (12) months following the date of termination of Continuous Service due to Disability; provided, however, that in no event shall the Option be exercisable after the Expiration Date. The unvested portion of the Option as of the date of termination of Continuous Service due to Disability shall immediately and automatically terminate and be forfeited without consideration as of such date.
6.5 Resignation. If Participant voluntarily resigns from Continuous Service with the Company or any subsidiary (other than for Good Reason, if applicable and as defined herein), the treatment of the Option shall be as set forth in Section 6.1 above (i.e., a ninety (90)-day Post-Termination Exercise Period for the vested and unexercised portion of the Option, and immediate forfeiture of the unvested portion). If Participant's resignation constitutes a resignation for Good Reason (to the extent Good Reason is defined and applicable pursuant to a written agreement between the Company and Participant), the treatment of the Option shall be as set forth in such written agreement or, absent specific provisions therein, as set forth in Section 6.1 above.
6.6 Leave of Absence. A leave of absence approved in writing by the Company (or that is otherwise required to be granted under applicable law) shall not be treated as a termination of Continuous Service for purposes of this Agreement; provided, however, that vesting of the Option may be suspended during any such leave of absence to the extent provided in the Plan or as otherwise required by applicable law. For purposes of Incentive Stock Options, if Participant's leave of absence exceeds three (3) months and Participant's right to reemployment is not guaranteed by statute or contract, Participant's Continuous Service shall be deemed to have terminated on the first day following the expiration of such three-month period, and the Option shall thereafter be treated as a Non-Qualified Stock Option to the extent it is exercised more than three (3) months after such deemed termination date. The Committee shall have sole discretion to determine whether a particular leave of absence constitutes a termination of Continuous Service for purposes of the Plan and this Agreement, subject to applicable law.
Section 7. Incentive Stock Option Provisions
7.1 Applicability. The provisions of this Section 7 shall apply only if the Option is designated as an Incentive Stock Option in the Grant Notice. The treatment of the Option as an Incentive Stock Option is subject to, and conditioned upon, compliance with the requirements of Section 422 of the Code and the regulations promulgated thereunder. To the extent that the Option (or any portion thereof) does not qualify as an Incentive Stock Option for any reason (including, without limitation, by reason of the provisions of this Section 7), such Option (or the non-qualifying portion thereof) shall automatically be treated as a Non-Qualified Stock Option.
7.2 $100,000 Limitation. To the extent that the aggregate Fair Market Value (determined as of the Date of Grant) of shares of Common Stock with respect to which Incentive Stock Options (under all plans of the Company and its parent and subsidiary corporations, within the meaning of Sections 424(e) and 424(f) of the Code) first become exercisable by Participant during any calendar year exceeds One Hundred Thousand Dollars ($100,000), such excess Incentive Stock Options shall be treated as Non-Qualified Stock Options. For purposes of the foregoing limitation, Incentive Stock Options shall be taken into account in the order in which they were granted, and the Fair Market Value of the shares shall be determined as of the time the Incentive Stock Option with respect to such shares is granted.
7.3 Disqualifying Dispositions. If Participant disposes of any shares of Common Stock acquired upon the exercise of an Incentive Stock Option within two (2) years from the Date of Grant or within one (1) year from the date of exercise of the Option (a "Disqualifying Disposition"), Participant shall immediately notify the Company in writing of such disposition. Participant acknowledges and agrees that a Disqualifying Disposition may cause Participant to recognize ordinary income for federal income tax purposes in an amount equal to the excess of (a) the amount realized on such disposition (or, in the case of a disposition that is not a sale or exchange, the Fair Market Value of the shares on the date of disposition) over (b) the Exercise Price of such shares, and that the Company may be entitled to a corresponding federal income tax deduction. Participant further acknowledges that the Company may withhold from Participant's compensation, or require Participant to remit, an amount sufficient to satisfy any tax withholding obligations arising from a Disqualifying Disposition.
7.4 Post-Termination ISO Exercise Period. Notwithstanding the provisions of Sections 6.1, 6.3, and 6.4 of this Agreement, if the Option is designated as an Incentive Stock Option and Participant exercises the Option more than three (3) months after the date of termination of Participant's employment with the Company or any subsidiary (or more than twelve (12) months after such termination, in the case of termination due to Disability), the Option shall be treated as a Non-Qualified Stock Option to the extent exercised after such period, except that the foregoing three-month limitation shall not apply in the event of Participant's death. For purposes of this Section 7.4, "employment" means employment as an employee (and not merely service as a director or consultant), in accordance with the requirements of Section 422 of the Code.
7.5 Ten Percent Stockholders. If Participant is, at the time of grant of the Option, a person who owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or of any parent or subsidiary corporation (within the meaning of Section 422(b)(6) of the Code) (a "Ten Percent Stockholder"), the following additional requirements shall apply to the Option:
(a) The Exercise Price per Share shall not be less than one hundred ten percent (110%) of the Fair Market Value of a share of Common Stock on the Date of Grant.
(b) The Term of the Option shall not exceed five (5) years from the Date of Grant.
7.6 No Guarantee of ISO Treatment. The Company does not represent, warrant, or guarantee that the Option will qualify as, or will continue to be treated as, an Incentive Stock Option under Section 422 of the Code. Participant acknowledges that the tax treatment of the Option depends on a number of factors and circumstances, many of which are outside the control of the Company, and that the characterization of the Option as an Incentive Stock Option may be affected by future changes in law, regulations, or administrative guidance. Participant is solely responsible for determining the tax consequences of the Option and should consult with Participant's own tax advisor regarding the same.
Section 8. Tax Matters
8.1 Tax Withholding Obligation. As a condition precedent to the exercise of the Option (in whole or in part), Participant shall make arrangements satisfactory to the Company for the satisfaction of all applicable federal, state, and local income tax withholding obligations and employment tax withholding obligations (including, without limitation, obligations for Federal Insurance Contributions Act (FICA) taxes and federal and state unemployment taxes) arising from or in connection with the exercise of the Option. The Company shall have the right, but not the obligation, to withhold from any compensation or other amounts owing from the Company to Participant (including, without limitation, salary, wages, bonuses, or other compensation), or to require Participant to remit to the Company, an amount sufficient to satisfy all applicable withholding obligations. The Company shall not be required to issue any Shares upon exercise of the Option until all applicable withholding obligations have been satisfied.
8.2 Methods of Satisfying Withholding. The withholding obligation described in Section 8.1 may be satisfied, at the election of Participant and subject to the approval of the Committee, by one or a combination of the following methods:
(a) Payment to the Company in cash (including by check, wire transfer, or other immediately available funds) of an amount equal to the applicable withholding obligation.
(b) Withholding from Participant's wages, salary, bonus, or other cash compensation payable by the Company to Participant, in an amount equal to the applicable withholding obligation.
(c) Withholding of Shares of Common Stock otherwise issuable to Participant upon exercise of the Option (a "net share settlement"), with such withheld Shares valued at their Fair Market Value on the date of exercise. The number of Shares so withheld shall not exceed the number of Shares having a Fair Market Value equal to the applicable withholding obligation calculated using the maximum statutory withholding rates for federal, state, and local tax purposes (including payroll taxes) that are applicable to Participant's supplemental taxable income, or such lesser rate as the Committee may determine is necessary to avoid adverse accounting consequences.
(d) Such other method as the Committee may approve in its sole discretion, consistent with the terms of the Plan and applicable law.
8.3 Section 409A. The Option is intended to be exempt from the application of Section 409A of the Code pursuant to Treasury Regulation Section 1.409A-1(b)(5)(i) (relating to stock options granted at fair market value), and this Agreement shall be construed and interpreted accordingly. In no event shall the Exercise Price per Share be less than the Fair Market Value of a share of Common Stock on the Date of Grant, as determined in accordance with the Plan and in a manner consistent with Section 409A of the Code and Treasury Regulation Section 1.409A-1(b)(5)(iv). The Company makes no representation, warranty, or guarantee regarding the tax treatment of the Option under Section 409A of the Code or any other provision of the Code, and shall not be liable to Participant for any taxes, penalties, or interest that may be imposed under Section 409A.
8.4 Tax Advice. Participant acknowledges that the Company has not provided Participant with any tax advice regarding the Option, and Participant is hereby advised to consult with Participant's own qualified tax advisor regarding the federal, state, local, and foreign tax consequences of the grant, vesting, exercise, and disposition of the Option and any Shares acquired upon exercise thereof. Without limiting the generality of the foregoing, Participant is advised to consult with Participant's tax advisor regarding the potential applicability of the alternative minimum tax ("AMT") in connection with the exercise of an Incentive Stock Option, the tax consequences of a Disqualifying Disposition (as described in Section 7.3), and the availability and advisability of filing an election under Section 83(b) of the Code in the event that the Option is exercised with respect to unvested Shares (if early exercise is permitted under the terms of this Agreement or the Grant Notice). Participant acknowledges that a Section 83(b) election, to the extent applicable, must be filed with the Internal Revenue Service within thirty (30) days of the date of exercise with respect to unvested Shares, and that Participant is solely responsible for timely making such election if Participant determines it to be appropriate.
8.5 Section 162(m). Participant acknowledges that certain compensation of "covered employees" (as defined in Section 162(m) of the Code) may not be deductible by the Company for federal income tax purposes. The Committee may, in its sole discretion, take into account the limitations imposed by Section 162(m) in connection with the grant, vesting, or exercise of the Option and the design of compensation arrangements generally. Nothing in this Agreement shall be construed to require the Company to structure the Option or any other compensation arrangement in a manner intended to qualify for an exemption from Section 162(m), and Participant shall have no claim against the Company in the event that compensation attributable to the Option is not deductible by the Company.
Section 9. Non-Transferability
9.1 General Restriction. Except as otherwise provided in this Section 9, the Option shall not be transferable by Participant other than by will or the laws of descent and distribution. During Participant's lifetime, the Option may be exercised only by Participant (or, in the event of Participant's legal incapacity, by Participant's duly appointed legal guardian or representative acting in a fiduciary capacity on behalf of Participant under court supervision). Any attempt to transfer, assign, pledge, hypothecate, or otherwise dispose of the Option in a manner not expressly permitted by this Agreement and the Plan shall be null, void, and of no effect.
9.2 NQSO Exception. Notwithstanding Section 9.1, if the Option is designated as a Non-Qualified Stock Option, the Committee may, in its sole discretion, permit the transfer of the Option (or any portion thereof) by Participant to one or more of the following transferees, provided that no consideration is paid in connection with such transfer:
(a) Members of Participant's immediate family (defined for this purpose as Participant's spouse, domestic partner, children, stepchildren, grandchildren, parents, stepparents, siblings, or any spouse or domestic partner of the foregoing);
(b) A trust for the primary benefit of one or more members of Participant's immediate family;
(c) A partnership, limited liability company, or other entity in which Participant and/or members of Participant's immediate family are the sole owners of all equity interests; or
(d) Such other transferees as the Committee may approve in writing.
Any such transfer shall be subject to the condition that the transferee executes a written instrument, in form and substance satisfactory to the Company, agreeing to be bound by all of the terms and conditions of this Agreement and the Plan. No transfer for value (including, without limitation, any sale, exchange, or other disposition for consideration) shall be permitted under any circumstances. The Company shall not be required to recognize or give effect to any purported transfer of the Option that does not comply with the requirements of this Section 9.2.
9.3 No Assignment. No rights under this Agreement may be pledged, alienated, attached, garnished, or otherwise encumbered, and any attempt to pledge, alienate, attach, garnish, or otherwise encumber the Option or any rights hereunder shall be null, void, and without effect. No right or interest of Participant under this Agreement shall be subject to the debts, contracts, or liabilities of Participant, or be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment, or any other means, whether voluntary or involuntary or by operation of law.
Section 10. Lock-Up Restriction
10.1 Lock-Up. Participant acknowledges and agrees that any shares of Common Stock acquired upon exercise of the Option may be subject to a lock-up agreement entered into by Participant in connection with the Company's initial public offering (the "IPO Lock-Up Agreement"), which restricts the sale, transfer, pledge, or other disposition of such shares for a period of one hundred eighty (180) days following the date of the final prospectus relating to the IPO (i.e., from February 8, 2024, through and including August 6, 2024), in favor of Whitfield Barrow & Co., LLC, as Representative of the underwriters in the Company's initial public offering. Participant agrees to comply with the terms of any such IPO Lock-Up Agreement to which Participant is a party. The Company may instruct its transfer agent, Continental Share Services, Inc., to impose stop-transfer restrictions on Shares held by Participant during the period of the lock-up.
10.2 Market Stand-Off. Notwithstanding whether Participant has entered into a separate lock-up agreement in connection with the IPO or otherwise, Participant hereby agrees that, upon the request of the Company or the managing underwriter(s) in connection with any public offering of the Company's equity securities (whether the IPO or any subsequent offering), Participant shall not, directly or indirectly, sell, offer to sell, contract to sell, make any short sale of, grant any option for the purchase of, pledge, hypothecate, or otherwise transfer or dispose of any Shares acquired upon exercise of the Option (or any securities convertible into or exercisable or exchangeable for Shares), or enter into any hedging, swap, or similar transaction that transfers, in whole or in part, any of the economic consequences of ownership of such Shares, for such period of time (not to exceed one hundred eighty (180) days, or such shorter period as may be agreed upon by the Company and the managing underwriter(s)) following the effective date of the applicable registration statement as may be requested by the Company or the managing underwriter(s). The Company may impose stop-transfer instructions with respect to such Shares until the end of any such market stand-off period. Participant agrees to execute such further agreements and instruments as may be reasonably required to effectuate the provisions of this Section 10.2. This market stand-off obligation shall apply to the Company's initial public offering and to any subsequent public offering of the Company's equity securities, as the Committee may determine in its sole discretion.
Section 11. Adjustments
11.1 Capital Adjustments. In the event of any stock split, reverse stock split, stock dividend, recapitalization, combination, reclassification, or similar change in the capital structure of the Company (whether effected without consideration or otherwise), the Committee shall make appropriate and proportionate adjustments to (a) the number and class of shares of Common Stock (or other securities) subject to the Option, and (b) the Exercise Price per Share, in each case in accordance with the adjustment provisions of the Plan, so as to preserve the economic value of the Option. Any such adjustment shall be made by the Committee in its sole discretion, and the Committee's determination shall be final, binding, and conclusive. No fractional shares shall be issued as a result of any such adjustment; any fractional share resulting from such adjustment shall be rounded down to the nearest whole share.
11.2 Change in Control. Upon the occurrence of a Change in Control (as defined in the Plan), the Option shall be treated in accordance with the applicable provisions of the Plan governing corporate transactions and changes in control. Without limiting the generality of the foregoing, the Plan provides that in connection with a Change in Control, the Committee (or the board of directors of any surviving or acquiring entity) may, in its sole discretion, take one or more of the following actions with respect to the Option:
(a) Provide for the assumption or substitution of the Option by the surviving or acquiring entity (or a parent thereof) on substantially equivalent terms;
(b) Provide for the accelerated vesting and exercisability of the Option, in whole or in part, for a specified period prior to the consummation of the Change in Control, with the Option terminating upon consummation of such Change in Control to the extent not exercised;
(c) Provide for the cancellation of the Option in exchange for a cash payment, shares of the surviving or acquiring entity, or other consideration, in an amount equal to the excess, if any, of the Fair Market Value of the Shares subject to the Option (or the per-share consideration received by holders of Common Stock in connection with the Change in Control) over the Exercise Price of such Shares; or
(d) Take such other action as the Committee deems appropriate and consistent with the Plan.
The specific treatment of the Option in connection with a Change in Control may also be governed by a separate written agreement between the Company and Participant (such as a change in control severance agreement or employment agreement), to the extent such agreement provides for specific treatment of equity awards in connection with a Change in Control.
Section 12. Rights as Stockholder
Participant shall not be deemed to be a stockholder of the Company, and shall have no rights as a stockholder of the Company (including, without limitation, the right to vote shares of Common Stock, to receive dividends or other distributions with respect thereto, or to exercise any preemptive or other subscription rights), with respect to any Shares subject to the Option until such Shares have been validly issued and recorded on the books of the Company (or its transfer agent, Continental Share Services, Inc.) following a valid exercise of the Option in accordance with this Agreement and the Plan, full payment of the aggregate Exercise Price and any applicable tax withholding amounts, and compliance with all applicable securities laws and regulations. No adjustment shall be made for dividends, distributions, or other rights for which the record date is prior to the date of issuance and recording of such Shares.
Section 13. Compliance with Law
13.1 Securities Law Compliance. The grant of the Option and the issuance of Shares upon exercise of the Option are subject to compliance with all applicable federal and state securities laws, rules, and regulations. The Company shall not be required to issue or deliver any Shares upon exercise of the Option if, in the opinion of counsel to the Company, such issuance or delivery would violate any applicable federal or state securities law, rule, or regulation, including, without limitation, the Securities Act of 1933, as amended (the "Securities Act"), or the rules and regulations of the NYSE. The Company may require, as a condition to the issuance of Shares, that Participant make such representations, warranties, and agreements as the Company may deem necessary or advisable in order to comply with applicable securities laws, including (without limitation) a representation that the Shares are being acquired for investment and not with a view to distribution.
13.2 Restrictive Legends. Certificates (if any) or book-entry notations for Shares issued upon exercise of the Option may bear such restrictive legends, notations, or stop-transfer instructions as the Company and its counsel (Calderwood & Harkness LLP or successor counsel) deem necessary or advisable under applicable federal and state securities laws, including, without limitation:
(a) A legend reflecting restrictions on transfer under the Securities Act (e.g., to the effect that the Shares have not been registered under the Securities Act and may not be offered, sold, or otherwise disposed of without registration or an applicable exemption from registration);
(b) A legend reflecting the lock-up and market stand-off restrictions described in Section 10 of this Agreement; and
(c) Such other legends or notations as the Company or its counsel may deem necessary or advisable in connection with applicable state "blue sky" laws or the rules and regulations of the NYSE.
Such legends or notations shall be removed only upon compliance with applicable securities laws and Company policies, as determined by the Company and its counsel.
13.3 Insider Trading Policy. Participant acknowledges that Participant has received, reviewed, and agrees to comply with the Company's Insider Trading Compliance Policy (as may be amended, restated, or supplemented from time to time) (the "Insider Trading Policy"), including, without limitation, any applicable blackout periods, quarterly trading windows, and pre-clearance requirements applicable to transactions in the Company's securities. Participant acknowledges that the exercise of the Option and the sale of Shares acquired upon exercise may be subject to the restrictions and requirements of the Insider Trading Policy, Section 16 of the Securities Exchange Act of 1934, as amended (if applicable), Rule 10b-5 thereunder, and Regulation BTR promulgated by the Securities and Exchange Commission. Participant agrees that Participant shall not exercise the Option or sell any Shares acquired upon exercise during any period in which such exercise or sale would violate the Insider Trading Policy or applicable securities laws.
Section 14. Clawback / Recoupment
The Option and any Shares acquired upon exercise of the Option, and any proceeds, gains, or other economic benefit actually or constructively received by Participant upon the exercise or disposition of the Option or the sale of Shares acquired upon exercise, shall be subject to any clawback, recoupment, forfeiture, disgorgement, or similar policy or agreement adopted by the Company from time to time, including, without limitation, any policy adopted by the Company to comply with (a) the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act"), (b) Rule 10D-1 under the Securities Exchange Act of 1934, as amended, (c) the NYSE Listed Company Manual Section 303A.14 and applicable listing standards regarding recovery of erroneously awarded compensation, and (d) any other applicable law, rule, or regulation. Participant acknowledges and agrees that the Company may, to the extent required or permitted by any such policy, applicable law, or regulation, require the forfeiture, repayment, reimbursement, or recoupment of the Option, any Shares acquired upon exercise, and/or any gains or proceeds realized from the exercise or disposition of the Option, and Participant agrees to promptly comply with any such requirement. By accepting the Option, Participant consents to and agrees to be bound by the terms of any such clawback or recoupment policy, as it may be adopted or amended from time to time.
Section 15. Data Privacy
Participant hereby acknowledges, understands, and consents to the collection, use, processing, storage, and transfer (including cross-border transfer) of certain personal data by and among the Company, its subsidiaries and affiliates, and the Company's agents, representatives, and service providers (including, without limitation, Continental Share Services, Inc., as the Company's transfer agent, any stock plan administration service provider, and any broker designated by the Company for purposes of cashless exercises) as may be necessary or appropriate for the administration of this Agreement and the Plan. Such personal data may include, without limitation, Participant's name, home address, email address, telephone number, date of birth, social security number or other tax identification number, employee identification number, salary, nationality, job title, information regarding the Option (including the Date of Grant, Exercise Price, vesting schedule, and exercise history), and any other information necessary for the implementation, administration, and management of the Plan.
Participant understands that such data may be transferred to and processed in jurisdictions outside Participant's country of residence, including the United States, where data privacy laws may not provide the same level of protection as the laws in Participant's country of residence. Participant consents to any such transfer and processing and agrees that the Company and its agents may retain such data for as long as reasonably necessary for the purposes described herein. Participant understands that Participant may, at any time, review Participant's personal data, request a correction to it, or withdraw Participant's consent herein by contacting the Company in writing; provided, however, that such withdrawal of consent may affect Participant's ability to participate in the Plan.
Section 16. Notices
All notices, requests, demands, and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given when (a) delivered personally (with written confirmation of receipt), (b) sent by certified or registered mail, return receipt requested, postage prepaid, (c) sent by nationally recognized overnight courier service (with written confirmation of delivery), or (d) sent by email (with confirmation of transmission and no bounce-back or delivery failure notification), addressed as follows:
If to the Company:
Arbor Health Technologies Inc. 275 Kendall Avenue, Suite 1400 Cambridge, MA 02142
Attention: General Counsel
Email: legal@arborhealth.com
If to Participant:
At the address set forth in the Grant Notice, or at such other address as Participant may designate by written notice to the Company in accordance with this Section 16.
Notices delivered personally shall be effective upon delivery. Notices sent by certified or registered mail shall be effective five (5) business days after deposit in the United States mail. Notices sent by overnight courier shall be effective one (1) business day after deposit with such courier. Notices sent by email shall be effective upon confirmation of transmission; provided, however, that any notice of exercise of the Option must be delivered in accordance with Section 4.1 and the procedures established by the Company from time to time.
Section 17. Entire Agreement; Amendment
17.1 Entire Agreement. This Agreement (including the Grant Notice to which this Agreement is attached, and all appendices hereto) and the Plan constitute the entire agreement between the Company and Participant with respect to the subject matter hereof and supersede all prior and contemporaneous agreements, understandings, negotiations, discussions, representations, and warranties, whether oral or written, relating to such subject matter. No oral or written representation, warranty, or agreement not expressly set forth in this Agreement or the Plan shall be binding upon either party.
17.2 Amendment. This Agreement may not be amended, modified, or supplemented in any respect except by a written instrument executed by both the Company (acting through the Committee or an authorized officer) and Participant, or as otherwise expressly permitted under the Plan. Notwithstanding the foregoing, the Committee may amend the Plan or this Agreement unilaterally, without Participant's prior written consent, if such amendment (a) is required by applicable law, rule, or regulation (including, without limitation, Section 409A of the Code or the rules and regulations of the NYSE), or (b) does not materially and adversely affect Participant's rights under this Agreement, as determined by the Committee in good faith.
Section 18. Governing Law; Jurisdiction
18.1 Governing Law. This Agreement shall be governed by, and construed and interpreted in accordance with, the internal substantive laws of the State of Delaware, without giving effect to any choice-of-law or conflict-of-law rules or principles that would cause the application of the laws of any other jurisdiction.
18.2 Jurisdiction. Any action, suit, or proceeding arising out of, relating to, or in connection with this Agreement or the transactions contemplated hereby shall be brought exclusively in the Court of Chancery of the State of Delaware (or, if the Court of Chancery declines to accept jurisdiction over a particular matter, the Superior Court of the State of Delaware, or, if subject matter jurisdiction over the matter is vested exclusively in the federal courts, the United States District Court for the District of Delaware) (collectively, the "Delaware Courts"). Each of the Company and Participant hereby irrevocably submits to the exclusive jurisdiction of the Delaware Courts for purposes of any such action, suit, or proceeding, and each party hereby irrevocably waives, and agrees not to assert, by way of motion, as a defense, or otherwise, (a) any claim that such party is not subject to personal jurisdiction in the Delaware Courts, (b) any objection that such party may now or hereafter have to the laying of venue of any such action, suit, or proceeding in any Delaware Court, and (c) any claim that any such action, suit, or proceeding brought in any Delaware Court has been brought in an inconvenient forum.
Section 19. Severability
If any provision of this Agreement is held to be invalid, illegal, or unenforceable in any respect under any applicable law, rule, or regulation or by any court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision hereof, and this Agreement shall be reformed, construed, and enforced as if such invalid, illegal, or unenforceable provision had never been contained herein. To the extent permitted by applicable law, each party hereto waives any provision of law that renders any provision of this Agreement invalid, illegal, or unenforceable in any respect.
Section 20. Waiver
No waiver by the Company of any breach of, or failure to comply with, any provision of this Agreement by Participant shall operate as or be construed as a waiver of any other or subsequent breach of, or failure to comply with, the same or any other provision of this Agreement. No waiver shall be effective unless it is in writing and signed by an authorized representative of the Company. The failure of the Company to insist upon strict compliance with any provision of this Agreement shall not constitute a waiver of the Company's right to demand strict compliance thereafter.
Section 21. Successors and Assigns
This Agreement shall be binding upon and shall inure to the benefit of the Company and its successors and assigns (including, without limitation, any successor by merger, consolidation, reorganization, or similar corporate transaction, or any entity that acquires all or substantially all of the Company's assets or business). Subject to the restrictions on transfer set forth in Section 9 of this Agreement, this Agreement shall be binding upon and shall inure to the benefit of Participant and Participant's heirs, legatees, executors, administrators, personal representatives, and permitted assigns. The Company may assign its rights and obligations under this Agreement to any successor entity without the consent of Participant, and the successor entity shall be substituted for the Company for all purposes under this Agreement.
Section 22. Electronic Delivery and Acceptance
The Company may, in its sole discretion, deliver any documents related to this Agreement, the Grant Notice, the Plan, and any future awards or grants under the Plan by electronic means, including by e-mail, by posting on an internal website or intranet maintained by the Company, or through a third-party stock plan administration platform. Participant hereby consents to electronic delivery and agrees that Participant's electronic acceptance or electronic signature (including acceptance through a "click-through" or similar mechanism on a third-party stock plan administration platform) shall have the same force and effect as a manual, ink-original signature. Participant agrees that the Company may rely on such electronic acceptance or si

ARBOR HEALTH TECHNOLOGIES INC.

STOCK OPTION AGREEMENT

ARBOR HEALTH TECHNOLOGIES INC.

STOCK OPTION GRANT NOTICE

PARTICIPANT INFORMATION:

GRANT DETAILS:

VESTING SCHEDULE:

VESTING TABLE:

PLAN REFERENCE:

AGREEMENT TO TERMS:

ARBOR HEALTH TECHNOLOGIES INC.

PARTICIPANT:

EXHIBIT A

ARBOR HEALTH TECHNOLOGIES INC.

STOCK OPTION AGREEMENT

TERMS AND CONDITIONS

Record

Parties

Dates

Amounts