2020 Bonus Plan

The Apollo Endosurgery Bonus Plan (the “Plan”) is designed to reward eligible employees for their contributions toward the successful accomplishment of specific financial and strategic business objectives, and individual performance.

Bonus amounts are determined based on both corporate performance and individual performance in relation to pre-established objectives.

Corporate performance will be measured based on financial objectives approved by the board of directors.

Individual performance will be measured based on the achievement of objectives and goals prepared by each participant and his or her manager and documented on an Individual Performance Plan. Objectives and goals are established at the beginning of each Plan Year, but may be modified throughout the Plan Year as necessary or appropriate, with management approval. Objectives and goals will be expressed as specific, quantifiable measures of performance in relation to key operating decisions for the participant’s department. While individual performance is normally based on the manager’s rating, the individual manager rating may be subject to executive override.

The Plan will have two separately funded pools – a Corporate pool (the “Corporate Component”) and Individual pool (the “Individual Component”).

The bonus pools will have the following levels of achievement defined below:

•Individual Threshold – is solely determined at the discretion of the Board upon their end of year review of the overall Company’s financial condition and operating performance.

•Corporate Component Threshold – minimum Company financial performance required before any corporate component pool will be funded.

•Target – financial performance required before the corporate component is eligible to be funded at 100%.

The key financial or operational targets of the Company form the corporate component, which is reviewed and set annually. Exceptions to this and modifications to this Bonus Plan can be made at any time at the board’s sole discretion.

At Target, corporate performance component of the bonus is anticipated to fund at 100% and individual’s manager rating (subject to adjustment) will determine the individual performance component. The two together form the individual’s final bonus amount.

A multiplier will be applied for performance between the Corporate Threshold and Target to determine the percentage of the bonus pool that will be funded, as well as performance that is above Target. The minimum funding for The Corporate Component bonus pool is 40% and there is no pre-established maximum funding limit for over achieving target.

Three performance metrics for the corporate component for 2020 are as follows:

•50% weighting. Target achievement of 2020 Endo product revenues

•30% weighting. Target achievement of 2020 Endo gross margin

•20% weighting. Target achievement of 2020 operating expenses

The bonus pool may be allocated to the business units/function level by the Company’s Chief Executive Officer based on such matters as he may determine to be appropriate, including but not limited to operating income results vs. budget, performance in relation to pre-established objectives and other financial results. For example, a business unit or department that exceeds its goals may receive a greater share of the total bonus pool than a business unit that under performs.

At the end of the Plan Year, the Company’s Chief Executive Officer may recommend adjustments to the bonus pool to the board of directors after consideration of key operating results. When calculating corporate performance for purposes of this Plan, the board of directors has the discretion to consider such matters as it determines to be appropriate, including any or all of the following:

•Extraordinary financial or corporate transactions that may occur during the plan year

•Effects of accounting changes

•Expenses for productivity initiatives

•Other non-operating items

•Integration activities or expense

•Performance in relation to pre-established objectives

•Any other items of significant income or expense which are determined to be appropriate adjustments

Target bonus awards will be expressed as a percentage of the employee’s eligible earnings for the Plan Year. Eligible earnings are defined as regular earnings paid during the year, holiday, vacation, and personal leave time. The target percentages will vary by position level. A participant’s actual bonus award may vary above or below the targeted level based on corporate performance, the overall performance of his or her business unit relative to the overall performance of the Company, and the participant’s performance in relation to his or her pre-determined individual objectives.