Exhibit 10.2
 
EMPLOYMENT AGREEMENT
 
     This Employment Agreement (this “Agreement”) is entered into as of the 29th
day of September, 2011, by and between John A. Scarlett, M.D. (“Executive”) and
Geron Corporation, a Delaware corporation (the “Company”).
 
     WHEREAS, the Company desires to employ Executive to provide personal
services to the Company, and wishes to provide Executive with certain
compensation and benefits in return for Executive’s services; and
 
     WHEREAS, Executive wishes to be employed by the Company and provide
personal services to the Company in return for certain compensation and
benefits;
 
     NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, it is hereby agreed by and between the parties hereto as
follows:
 
ARTICLE I
DEFINITIONS
 
     For purposes of the Agreement, the following terms are defined as follows:
 
     1.1 “Board” means the Board of Directors of the Company.
 
     1.2 “Cause” means the occurrence of any one or more of the following:
 
          (a) any willful act or omission by Executive constituting material
dishonesty, fraud or other malfeasance against the Company;
 
          (b) Executive’s conviction of a felony under the laws of the United
States or any state thereof or any other jurisdiction in which the Company
conducts business;
 
          (c) Executive’s debarment by the United States Food and Drug
Administration from working in or providing services to any pharmaceutical or
biotechnology company under the Generic Drug Enforcement Act of 1992, or other
ineligibility under any law or regulation to perform Executive’s duties to the
Company; or
 
          (d) Executive’s breach of any of the material policies of the Company.
 
     1.3 “Change in Control” shall have the meaning set forth in the Plan.
 
     1.4 “Code” means the Internal Revenue Code of 1986, as amended.
 
     1.5 “Company” means Geron Corporation, a Delaware corporation, and any
successor thereto.
 

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     1.6 “Comparable Employment” means employment on terms which provide
Executive with (a) the same or greater rate of base salary as in effect
immediately prior to Executive’s termination, (b) the same, an equivalent or a
higher job title and level of responsibility as Executive had immediately prior
to Executive’s termination, (c) the equivalent or a higher bonus opportunity as
the bonus opportunity for the calendar year preceding the calendar year in which
Executive’s termination occurs, and (d) a principal work location that is (i) no
more than (A) forty-five (45) miles from Executive’s principal work location
immediately prior to Executive’s termination with housing support and travel
reimbursement no less favorable than the reimbursement provided pursuant to
Section 3.5 of this Agreement and (B) thirty (30) miles farther from Executive’s
principal weekday residence than Executive’s principal work location was
immediately prior to Executive’s termination or (ii) located within thirty (30)
miles of Executive’s permanent residence, which as of the date of this Agreement
is located in Austin, Texas.
 
     1.7 “Covered Termination” means an Involuntary Termination Without Cause
that occurs at any time, provided that such termination constitutes a
“separation from service” within the meaning of Section 409A of the Code and the
regulations promulgated thereunder, including without limitation Treasury
Regulation Section 1.409A-1(h) (a “Separation from Service”).
 
     1.8 “Involuntary Termination Without Cause” means Executive’s dismissal or
discharge other than (i) for Cause or (ii) following an involuntary or voluntary
filing of a petition under Chapters 7 or 11 of Title 11 of the United States
Code Section 101 et. seq., an assignment for the benefit of creditors, a
liquidation of the Company’s assets in a formal proceeding or otherwise or any
other event of insolvency by the Company, in any case, without an offer of
Comparable Employment by the Company or a successor, acquirer, or affiliate of
the Company. For the purposes of this Agreement, the termination of Executive’s
employment due to Executive’s death or disability will not constitute a
termination for Cause.
 
     1.9 “Plan” means the Company’s 2011 Equity Incentive Award Plan, as
amended.
 
ARTICLE II
EMPLOYMENT BY THE COMPANY
 
     2.1 Position and Duties. Subject to the terms set forth herein, the Company
shall employ Executive in the position of Chief Executive Officer, such
employment to commence no later than September 29, 2011 (the date Executive
commences employment hereunder, the “Commencement Date”). During the term of
Executive’s employment with the Company, Executive will report to the Board or
its designee. Executive shall serve in an employee capacity and shall perform
such duties as are assigned to Executive by the Board and, except as otherwise
instructed by the Board, such other duties as are customarily associated with
the position of Chief Executive Officer. During the term of Executive’s
employment with the Company, Executive will devote Executive’s best efforts and
substantially all of Executive’s business time and attention to the business and
affairs of the Company (except for vacation periods as set forth herein and
reasonable periods of illness or other incapacities permitted by the Company’s
general employment policies or as otherwise set forth in this Agreement). The
Company shall appoint Executive as a member of the Board and, during the period
of time Executive serves as Chief Executive Officer hereunder, shall nominate
Executive for reelection as a member of the Board and use its best efforts to
cause Executive to be so elected.
 
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     2.2 Employment at Will. Both the Company and Executive acknowledge and
agree that Executive’s employment with the Company is “at-will” and not for any
specified time, and may be terminated at any time by Executive or the Company,
with or without cause, and with or without prior notice; provided, however, that
if Executive’s employment with the Company is terminated, Executive will be
eligible to receive certain severance payments and benefits as set forth in
Article IV below.
 
     2.3 Employment Policies. The employment relationship between the parties
hereto shall be governed by the general employment policies and practices of the
Company, including but not limited to those policies relating to the protection
of confidential information and assignment of inventions. In the event of a
conflict between the terms of this Agreement and the Company’s general
employment policies or practices, this Agreement shall control.
 
ARTICLE III
COMPENSATION
 
     3.1 Base Salary. During the term of Executive’s employment with the
Company, Executive shall receive an annual base salary of $550,000, subject to
increase in the sole discretion of the Board (the “Base Salary”), payable in
accordance with the regular payroll practices of the Company.
 
     3.2 Bonus. Executive shall be eligible to earn, for each fiscal year of the
Company ending during the term of Executive’s employment with the Company, an
annual discretionary cash bonus (an “Annual Bonus”) targeted at sixty percent
(60%) of Executive’s Base Salary. The Annual Bonus shall be paid on the date on
which annual bonuses are paid to the Company’s senior executives generally, but
in no event later than March 15th of the fiscal year following the year in which
the Annual Bonus is earned.
 
     3.3 Stock Option. As soon as practicable following the Commencement Date,
the Company shall grant Executive an option to purchase one million (1,000,000)
shares of Company common stock (the “Option”) having an exercise price equal to
the closing trading price of a share of Company common stock on the date of
grant. The Option shall vest with respect to 1/8th of the shares initially
subject thereto on the six-month anniversary of the Commencement Date and with
respect to 1/48th of the shares initially subject thereto on each monthly
anniversary of the Commencement Date thereafter, subject to Executive’s
continued service to the Company through the applicable vesting date, provided,
that upon the occurrence of a Change in Control, subject to Executive’s
continued service to the Company through the date of such Change in Control, the
Option shall vest and become exercisable with respect to one hundred percent
(100%) of the unvested shares subject thereto. The Option shall be exercisable
in full on the date of grant subject to Executive entering into a restricted
stock purchase agreement with respect to any unvested shares. Executive shall be
permitted to exercise any or all of the Option, whether or not vested. The
Option otherwise shall be subject to and governed in all respects by the terms
of the Plan and the option agreement to be entered into between the Company and
Executive.
 
     3.4 Standard Company Benefits; Vacation. Executive shall be entitled to all
rights and benefits for which Executive is eligible under the terms and
conditions of the Company’s benefit and compensation plans, practices, policies
and programs, as in effect from time to time, that are provided by the Company
to its senior executives generally. Executive will be eligible for vacation as
an executive under the Company’s vacation policy, as such policy may be modified
from time to time.
 
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     3.5 Housing Allowance and Reimbursement For Personal Travel. During
Executive’s employment so long as his primary residence is located in Austin,
Texas, the Company will provide Executive with reimbursement for out-of-pocket
rent of not more than $2,000 per month (the “Housing Allowance”) actually
incurred by Executive for his San Francisco Bay Area housing. In addition,
during Executive’s employment so long as his primary residence is located in
Austin, Texas, the Company will reimburse Executive for the actually incurred,
reasonable out-of-pocket costs of his weekly commute between the San Francisco
Bay Area and Austin, Texas; provided that in no event shall such amounts
provided to Executive pursuant to this sentence exceed in the aggregate $20,000
per year. Any reimbursement pursuant to this Section 3.5 shall be subject to the
Company’s policies for reimbursement as may be in place from time-to-time. To
the extent that any reimbursements payable pursuant to this Agreement are
subject to the provisions of Section 409A of the Code, such reimbursements shall
be paid to Executive no later than December 31 of the year following the year in
which the expense was incurred, the amount of expenses reimbursed in one year
shall not affect the amount eligible for reimbursement in any subsequent year,
and Executive’s right to reimbursement under this Agreement will not be subject
to liquidation or exchange for another benefit.
 
ARTICLE IV
SEVERANCE BENEFITS AND RELEASE
 
     4.1 Severance Benefits.
 
     (i) Payment of Accrued Obligations Upon Termination of Employment. Upon a
termination of Executive’s employment for any reason at any time following the
Commencement Date, the Company shall pay to in a single lump-sum cash payment
within thirty (30) days following the date of termination, the aggregate amount
of Executive’s (A) earned but unpaid Base Salary, (B) incurred but unreimbursed
business expenses and (C) accrued but unpaid vacation pay (collectively, the
“Accrued Obligations”).
 
     (ii) Severance Upon Covered Termination. If Executive’s employment
terminates due to a Covered Termination at any time after the Commencement Date,
then, in addition to the Accrued Obligations:
 
     (a) Executive shall be paid any unpaid Annual Bonus to which Executive
would have become entitled for any fiscal year of the Company that ends on or
before the termination date had Executive remained employment through the
payment date, payable in a single lump-sum payment on the date on which annual
bonuses are paid to the Company’s senior executives generally for such fiscal
year, but in no event later than March 15th following the end of the fiscal year
to which the Annual Bonus relates;
 
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     (b) Executive shall be paid an aggregate amount equal to twenty-four (24)
months of Executive’s Base Salary in effect on the date of termination, payable
to Executive in a single lump-sum amount on the sixtieth (60th) day following
the termination date;
 
     (c) Executive and Executive’s covered dependents will be eligible to
continue their health care benefit coverage as permitted by COBRA (Internal
Revenue Code Section 4980B) at the same cost to Executive as in effect
immediately prior to the Covered Termination for the one (l)-year period
following the Covered Termination, and be entitled to maintain coverage for
Executive and Executive’s eligible dependents at Executive’s own expense for the
balance of the period that Executive is entitled to coverage under COBRA; and
 
     (d) the Option, along with any subsequent options or other exercisable
equity interest in the Company held by Executive shall remain outstanding and
exercisable through the earlier of (i) the second anniversary of the date of
termination or (ii) the original expiration date of the option or other equity
interest.
 
Notwithstanding the foregoing, the amounts payable under this Article IV, other
than the Annual Bonus and the extended exercisability set forth in Section
4.1(d), shall be reduced by the amount of severance or other cash compensation,
if any, payable under the Company’s Change of Control Severance Plan. For the
avoidance of doubt, all amounts payable under this Agreement shall be subject to
applicable federal, state, local or foreign tax withholding requirements.
 
     4.2 Parachute Payments. If any payment or benefit Executive would receive
from the Company or otherwise in connection with a Change in Control (“Payment”)
would (i) constitute a “parachute payment” within the meaning of Section 280G of
the Code, and (ii) be subject to the excise tax imposed by Section 4999 of the
Code (the “Excise Tax”), then such Payment shall be reduced to the Reduced
Amount. The “Reduced Amount” shall equal either (x) the largest portion of the
Payment that would result in no portion of the Payment being subject to the
Excise Tax or (y) the largest portion, up to and including the total, of the
Payment, whichever amount, after taking into account all applicable federal,
state and local employment and income taxes and the Excise Tax (in each case,
computed at the highest applicable marginal rate), results in Executive’s
receipt, on an after-tax basis, of the greater amount of the Payment. If
payments or benefits constituting “parachute payments” must be reduced so that
the Payment equals the Reduced Amount, such reduction shall occur in the
following order unless Executive elects in writing, and the Company approves, a
different order: (i) reduction of cash payments; (ii) cancellation of
accelerated vesting of any stock awards; and (iii) reduction of non-cash
employee benefits. In the event that acceleration of vesting of stock award
compensation is reduced, such acceleration of vesting shall be cancelled in the
reverse order of the date of grant of Executive’s stock awards, such that the
award granted on the latest date preceding the Change in Control shall be
cancelled first, unless Executive elects in writing, and the Company approves, a
different order.
 
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     The Company, for general audit purposes, shall engage a nationally
recognized public accounting firm (the “Accounting Firm”) to perform the
foregoing calculations. The Company shall bear all expenses with respect to the
calculations and determinations by such Accounting Firm required to be made
hereunder. The Accounting Firm engaged to make the determinations hereunder
shall provide its calculations, together with detailed supporting documentation,
to the Company and Executive within fifteen (15) calendar days after the date on
which Executive’s right to a Payment is triggered (if requested at that time by
the Company or Executive) or such other time as requested by the Company or
Executive. If the Accounting Firm determines that no Excise Tax is payable with
respect to a Payment, either before or after the application of the Reduced
Amount, it shall furnish to the Company and Executive an opinion reasonably
acceptable to Executive that no Excise Tax will be imposed with respect to such
Payment. Any good faith determinations of the Accounting Firm made hereunder
shall be final, binding and conclusive upon the Company and Executive.
 
     4.3 Release. Notwithstanding the foregoing, Executive’s right to receive
the amounts provided for in Sections 4.1(ii) and 4.2 above shall be subject to
and conditioned upon Executive’s execution and non-revocation of a release of
claims in substantially the form attached hereto as Exhibit A (the “Release”)
(as such form may be modified to take into account changes in the law) within
fifty (50) days following the termination date. Such Release shall specifically
relate to all of Executive’s rights and claims in existence at the time of such
execution and shall confirm Executive’s obligations under the Proprietary
Information Agreement (as defined below). Executive shall have a certain period
of time to consider whether to execute such Release, as set forth in the
Release, and Executive may revoke such Release within seven (7) business days
after execution. In the event Executive does not execute such Release within the
applicable period, or if Executive revokes such Release within the subsequent
seven (7) business day period, none of the payments and benefits set forth in
Sections 4.1(ii) and 4.2 above shall be payable to Executive under this
Agreement.
 
     4.4 Six-Month Delay. Notwithstanding any provision to the contrary in this
Agreement, if Executive is at the time of Executive’s Separation from Service a
“specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code,
then, to the extent delayed commencement of all or any portion of the benefits
and payments to which Executive is entitled under this Agreement is required in
order to avoid a prohibited distribution under Section 409A(a)(2)(B)(i) of the
Code, such benefits and payments shall not be paid to Executive until the
earlier of (a) the first business day following the expiration of the six
(6)-month period following Executive’s Separation from Service or (b) the first
business day following the date of Executive’s death. Upon the expiration of the
applicable period, all payments deferred pursuant to this Section 4.4 shall be
paid in a single lump sum to Executive (or Executive’s estate or beneficiaries,
if applicable), without interest, and any remaining payments due under this
Agreement shall be paid as otherwise provided herein. For purposes of Section
409A of the Code and the Department of Treasury regulations issued thereunder,
Executive’s right to receive the payments and benefits payable pursuant to the
Agreement shall be treated as a right to receive a series of separate payments
and accordingly, each payment shall at all times be considered a separate and
distinct payment.
 
     4.5 Mitigation. Executive shall not be required to mitigate the amount of
any payment provided under this Agreement by seeking other employment or
otherwise, nor shall the amount of any payment provided for under this Agreement
be reduced by any compensation earned by Executive as a result of employment by
another employer or by any retirement benefits received by Executive after the
date of termination or otherwise.
 
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ARTICLE V
PROPRIETARY INFORMATION OBLIGATIONS
 
     5.1 Agreement. Executive agrees that, concurrently with the execution of
this agreement, Executive shall execute the Company’s Proprietary Information
and Inventions Agreement attached hereto as Exhibit B (the “Proprietary
Information Agreement”).
 
     5.2 Remedies. Executive acknowledges that Executive’s duties under the
Proprietary Information Agreement shall survive termination of Executive’s
employment with the Company and the termination of this Agreement. Executive
acknowledges that any remedy at law for any breach or threatened breach by
Executive of the provisions of the Proprietary Information Agreement would be
inadequate, and Executive therefore agrees that the Company shall be entitled to
injunctive relief in case of any such breach or threatened breach.
 
ARTICLE VI
OUTSIDE ACTIVITIES
 
     6.1 No Other Employment. Except with the prior written consent of the
Board, Executive shall not, during the term of Executive’s employment with the
Company, undertake or engage in any other employment, occupation or business
enterprise. Notwithstanding the foregoing, during the term of Executive’s
employment with the Company, Executive may (a) undertake or engage in other
employment, occupation or business enterprise in which Executive is a passive
investor, and/or (b) engage in civic and not-for-profit activities, in each
case, so long as such activities do not materially interfere with the
performance of Executive’s duties hereunder.
 
     6.2 No Conflicting Business Interests. During the term of Executive’s
employment with the Company, except on behalf of the Company, Executive shall
not, directly or indirectly, whether as an employee, officer, director,
stockholder, partner, proprietor, associate, representative, consultant, or in
any other capacity whatsoever, engage in, become financially interested in, be
employed by or have any business connection with any other person, corporation,
firm, partnership or other entity whatsoever known by Executive to compete
directly with the Company, throughout the world, in any line of business engaged
in (or planned to be engaged in) by the Company; provided, however, that
notwithstanding anything to the contrary herein, Executive may own securities of
any competitor corporation as a passive investor, so long as Executive’s direct
holdings in any one such corporation do not, in the aggregate, constitute more
than one percent (1%) of the voting stock of such corporation at any time.
 
ARTICLE VII
NONINTERFERENCE
 
     While employed by the Company and for one (1) year immediately following
the date on which Executive terminates employment or otherwise ceases to provide
services to the Company, Executive agrees not to interfere with the business of
the Company by soliciting or attempting to solicit any employee of the Company
to terminate such employee’s employment in order to become an employee,
consultant or independent contractor to or for any competitor of the Company.
Executive’s duties under this Article VII shall survive termination of
Executive’s employment with the Company and the termination of this Agreement.
 
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ARTICLE VIII
GENERAL PROVISIONS
 
     8.1 Notices. Any notices provided hereunder must be in writing and shall be
deemed effective upon the earlier of (i) personal delivery (including personal
delivery by telex) or (ii) the third (3rd) day after being mailed by first class
mail, addressed to the Company at its primary office location and to Executive
at Executive’s address then listed on the Company payroll, or at such other
address as the parties may later designate in writing.
 
     8.2 Section 409A. To the extent applicable, this Agreement shall be
interpreted in accordance with Section 409A of the Code and Department of
Treasury regulations and other interpretative guidance issued thereunder,
including without limitation any such regulations or other such guidance that
may be issued after the Commencement Date (“Section 409A”). Notwithstanding any
provision of this Agreement to the contrary, in the event that following the
Commencement Date, the Company determines in good faith that any compensation or
benefits payable under this Agreement may not be either exempt from or compliant
with Section 409A, the Company may adopt such amendments to this Agreement or
adopt other policies or procedures (including amendments, policies and
procedures with retroactive effect), or take any other commercially reasonable
actions necessary or appropriate to preserve the intended tax treatment of the
compensation and benefits payable hereunder, including without limitation
actions intended to (i) exempt the compensation and benefits payable under this
Agreement from Section 409A, and/or (ii) comply with the requirements of Section
409A, provided, that this Section 8.2 does not, and shall not be construed so as
to, create any obligation on the part of the Company to adopt any such
amendments, policies or procedures or to take any other such actions or to
create any liability on the part of the Company for any failure to do so.
 
     8.3 Severability. Whenever possible, each provision of this Agreement will
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision hereof and this Agreement will continue in full force and
effect without such provision.
 
     8.4 Waiver. If either party should waive any breach of any provisions of
this Agreement, such party shall not be deemed to have waived any preceding or
succeeding breach of the same or any other provision of this Agreement.
 
     8.5 Complete Agreement. This Agreement, together with the exhibits attached
hereto and the Proprietary Information Agreement, constitutes the entire
agreement between Executive and the Company and is the complete, final, and
exclusive embodiment of their agreement with regard to the subject matter herein
(except for the Plan, any successor thereto or the Company’s Change of Control
Severance Plan). This Agreement supersedes any prior agreement between Executive
and the Company or any predecessor employer in its entirety. Executive and the
Company acknowledge and agree that this Agreement is entered into without
reliance on any promise or representation other than those expressly contained
herein and cannot be modified or amended except in a writing signed by a
duly-authorized officer of the Company.
 
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     8.6 Counterparts. This Agreement may be executed in one or more
counterparts, each of which will have the same force and effect as an original,
but all of which taken together will constitute one and the same Agreement.
 
     8.7 Headings. The headings of the sections hereof are inserted for
convenience of reference only and shall not be deemed to constitute a part of
this Agreement nor to affect the meaning or interpretation of any part of this
Agreement.
 
     8.8 Successors and Assigns. This Agreement is intended to be binding on,
inure to the benefit of and be enforceable by Executive and the Company and
their respective successors, assigns, heirs, executors and administrators,
except that Executive may not assign any of Executive’s duties or rights
hereunder without the prior written consent of the Company, which consent shall
not be withheld unreasonably.
 
     8.9 Arbitration. In the event of any contractual, statutory or tort dispute
or claim relating to or arising out of Executive’s employment relationship with
the Company (including but not limited to any claims of wrongful termination or
age, sex, race, or other discrimination, but not including workers’ compensation
claims), Executive and the Company agree that all such disputes will be finally
resolved by binding arbitration conducted by a single neutral arbitrator
associated with the American Arbitration Association in Menlo Park, California.
Executive and the Company hereby waive their respective rights to have any such
disputes or claims tried to a judge or jury. However, the Company agrees that
this arbitration provision will not apply to any claim, by either Executive or
the Company, for injunctive relief. The administrative costs of any arbitration
proceeding between Executive and the Company and the fees and costs of the
arbitrator shall be borne by the Company.
 
     8.10 Attorneys’ Fees. If either party hereto brings any action to enforce
its respective rights hereunder, each party in any such action shall be
responsible for its own attorneys’ fees and costs incurred in connection with
such action.
 
     8.11 Acknowledgement. Executive acknowledges that Executive (a) has had the
opportunity to discuss this matter with and obtain advice from independent
counsel of Executive’s own choice and has been advised to do so by the Company,
(b) has carefully read and fully understands all the provisions of this
Agreement, and (c) is knowingly and voluntarily entering into this Agreement.
Executive represents that Executive (i) is familiar with the restrictive
covenants set forth in the Proprietary Information Agreement and (ii) is fully
aware of his obligations thereunder.
 
     8.12 Choice of Law. All questions concerning the construction, validity and
interpretation of this Agreement will be governed by the law of the State of
California, without regard to the principles of conflict of laws thereof.
 
[Signature Page Follows]
 
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IN WITNESS WHEREOF, the parties have executed this Agreement on the on the day
and year first above written.
 

  GERON CORPORATION,   a Delaware corporation               By:      /s/ Hoyoung
Huh     Hoyoung Huh, M.D., Ph.D.     Executive Chairman         Date: September
29, 2011

Acknowledged, accepted and agreed this 29th day of September, 2011:
 
 

/s/ John A. Scarlett John A. Scarlett, M.D.

 
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EXHIBIT A
 
General Release
 
 
 
 
 
 
 
 
 
 
 

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EXHIBIT B
 
Proprietary Information and Inventions Agreement
 
 
 
 
 
 
 
 
 
 
 

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