[image_001.jpg] 

Xenetic Biosciences, Inc.

Ledgemont Research Ctr

Hayden Avenue

Lexington, MA 02421

United States

t 781-778-7722

e info@xeneticbio.com

 

 Roger D. Kornberg

Stanford University Medical School

Department of Structural Biology

[ADDRESS REDACTED]

 

Dear Roger:

This Letter Agreement (the “Agreement”) is to confirm the terms of your proposed
appointment on February 2016 (the “Effective Date”) as a non-employee,
independent Director of Xenetic Biosciences, Inc. (the “Company”).

 

Overall, in terms of time commitment, we expect your attendance at all the Board
meetings and meetings of such committees of the Board that you will be appointed
to (as applicable). In addition, you will be expected to devote appropriate
preparation time ahead of each meeting. You will also, when time allows, assist
in the presentation of the Company at various conferences when and as requested
by the Chief Executive Officer. The Company acknowledges your role as a
researcher and professor of structural biology at Stanford University as well as
your membership on various other public company boards and scientific advisory
committees.

 

By accepting this appointment, you have confirmed that you are able to allocate
sufficient time to meet the expectations of this position.

 

1.    Consideration. For and in consideration of the services to be performed by
you, the Company agrees to compensate you as follows:

 

1.1Director Fee. A director fee equal to $50,000 (Fifty Thousand U.S. Dollars)
per annum, payable quarterly (the “Board Meeting Fee”) will be the cash
compensation for your role as a director along with any board committee chair or
membership positions you may hold as part of the board.

 

1.2Stock Options. Subject to all approvals required by law, the Company will
grant you, pursuant to an equity incentive plan or such other plan to be adopted
by the Company (the "Plan") and upon such terms and conditions as determined by
the Compensation Committee or the Board (as applicable), a fully vested option
to purchase One Hundred Thousand (100,000) shares of common stock of the Company
at a strike price determined by the closing price of the common stock on the
date of your appointment (the “Initial Grant”). Additionally, the Company shall
grant you on the one year anniversary date of your appointment as Director for
so long as you remain a Director of the Company, an option to purchase an
additional One Hundred Thousand

 
 

(100,000) shares of common stock of the Company at a strike price determined by
the closing price of the common stock on the date of such grant.

 

If your board service is terminated or ends for any reason, all granted Options
that have not been exercised, shall be exercisable by you any time within six
(6) months of the termination of your board position (the “Termination Exercise
Period”). Any Options that are not exercised within the Termination Exercise
Period, shall expire immediately.

 

1.2.1 Term of Options. All Options shall be in effect for a period of 10 years
commencing immediately after the granting of all Options granted to you under
this letter of appointment, and shall expire immediately thereafter, unless
terminated sooner as provided in Section 1.2. Without derogating from the
aforesaid, if the Plan that shall be approved by the Company shall include
additional provisions related to expiration of Options, such provisions shall
also apply with respect to all Options granted to you under this letter of
appointment.

 

1.2.1a Vesting. All Options granted to you shall vest as provided in Section
1.2.

 

1.2.1b Price. The exercise price of the Options shall be equal to the Company’s
stock price on the date of your appointment.

1.2.1c General. All options granted to you shall be in effect subject to your
continuous service as a Director and subject to the terms and conditions of the
Company’s Stock Option Plan (the “Plan”), including such terms related to
vesting and expiration, and subject to such terms and conditions as will be
approved by the Company, at its sole discretion. In case of contradiction
between the provisions of this letter of appointment and the provisions of the
Plan, the provisions of the Plan shall supersede.

 

1.2.1d Certain Representations. You represent and agree that you are accepting
the shares of common stock being issued to you pursuant to this Agreement for
your own account and not with a view to or for sale of distribution thereof. You
understand that the securities are restricted securities and you understand the
meaning of the term “restricted securities.” You further represent that you were
not solicited by publication of any advertisement in connection with the receipt
of the shares and that you have consulted tax counsel as needed regarding the
shares.

 

1.3  Company agrees to reimburse you for out-of-pocket expenses incurred by you
in connection with your service (including out-of-pocket expenses,
transportation, and first-class airfare on company business, provided that such
expenses are against original and valid receipts (the “Expenses”).

 

1.4  Payment of the Expenses, as applicable, shall be made against your itemized
invoice following the receipt of the relevant invoice, which invoice shall be
submitted to the Company within seven (7) days of the end of each calendar month
during the term of this letter of appointment.

 

1.5  For the avoidance of any doubt, the Fee and the Options (subject to their
terms) and the aforementioned Expenses constitute the full and final
consideration for your appointment, and you shall not be entitled to any
additional consideration, of any form, for your appointment and service.

 
 

 

2.  The term of your appointment as a non-employee, director of the Company
shall be for one year or until the next Meeting of Stockholders and shall be
renewable on a yearly basis by vote of the shareholders or appointment by the
board.

 

3.  You will undertake such travelling as may reasonably be necessary for the
performance of your duties, including travelling for board meetings and site
visits if required.

 

4.  You will undertake such duties and powers relating to the Company and any
subsidiaries or associated companies (the “Group”) as the Board may from time to
time reasonably request. The Board as a whole is collectively responsible for
promoting the success of the Company by directing and supervising the Company’s
affairs, inter alia, as follows:

 

4.1             Providing entrepreneurial leadership of the Group within a
framework of prudent and effective controls which enable risk to be assessed and
managed; and

 

4.2             Setting the Group’s strategic aims, ensures that the necessary
financial and human resources are in place for the Group to meet its objectives
and reviews of management performance; and

 

4.3             Setting the Group’s values and standards and ensure that its
obligations to its shareholders and others are understood and met.

 

4.3.1Managing conflicts of interest that may arise in board meetings; and

 

4.3.2Ensuring that all board members are acting in the best interests of all
shareholders.

 

5. Confidential Information.

5.1  You undertake to the Company that you shall maintain in strict
confidentiality all trade, business, technical or other information regarding
the Company, the Group, its affiliated entities and their business affairs
including, without limitation, all marketing, sales, technical and business
know-how, intellectual property, trade secrets, identity and requirements of
customers and prospective customers, the Company’s methods of doing business and
any and all other information relating to the operation of the Company
(collectively, the “Confidential Information”). You shall at no time disclose
any Confidential Information to any person, firm, or entity, for any purpose
unless such disclosure is required in order to fulfil your responsibilities as
director. You further undertake that you shall not use such Confidential
Information for personal gain.

 “Confidential Information” shall not include information that (i) is or becomes
part of the public domain other than as a result of disclosure by You, (ii)
becomes available to you on a non-confidential basis from a source other than
the Company, provided that the source is not bound with respect to that
information by a confidentiality agreement with the Group or is otherwise
prohibited from transmitting that information by a contractual legal or other
obligation, or (iii) can be proven by you to have been in your possession prior
to disclosure of the information by the Company. In the event that you are
requested or required (by oral questions, interrogatories, requests for
information or documents, subpoena, civil investigative demand or other process)
to disclose any Confidential Information, it is agreed that you, to the extent
practicable under the circumstances, will provide the Company with prompt notice
of any such request or requirement so that the Company may seek an appropriate
protective order or waive compliance with this paragraph 5. If a protective
order or the receipt of a waiver hereunder has not been obtained, you may
disclose only that portion of the Confidential Information which you are legally
compelled to disclose.

 
 

5.2    Blackout Period. You understand that we have, or intend to have, a policy
pursuant to which no officer, director or key executive may not engage in
transactions in our stock during the period commencing the end of a fiscal
quarter and ending the day after the financial information for the quarter and
year have been publicly released. If you become a member of the audit committee
and you have information concerning our financial results at any time, you may
not engage in transactions in our securities until the information is publicly
disclosed.

 

6. Term and Termination

6.1   Subject to paragraph 6.2 hereunder, this appointment shall terminate
immediately and without claim for compensation on the occurrence of any of the
following events:

 

6.1.1       If you resign as a Director of the Company for any reason; and/or

 

6.1.2       If you are removed or not re-appointed as a Director of the Board of
the Company at a General Meeting of shareholders of the Company in accordance
with the requirements of the Business Corporation Law of the State of Nevada
and/or any other applicable law or regulation (the "Law") and/or the Company's
Articles of Incorporation; and/or

 

6.1.3       If you have been declared bankrupt or made an arrangement or
composition with or for the benefit of your creditors; and/or

 

6.1.4       If you have been disqualified from acting as a Director (including,
but not limited to, an event in which you are declared insane or become of
unsound mind or become physically incapable of performing your functions as
director for a period of at least sixty (60) days; and/or

 

6.1.5If an order of a court having jurisdiction over the Company requires you to
resign.

6.2   Any termination of this letter of appointment shall be without payment of
damages or compensation (except that you shall be entitled to any accrued Fees
or Expenses properly incurred under the terms of this letter of appointment
prior to the date of such termination).

 

7.  The Company will put directors’ and officers’ liability insurance in place
within sixty

(60) days of this Agreement if not already in place, and will use commercial
reasonable efforts to maintain such insurance coverage for the full term of your
appointment.

 

8.  On termination of this appointment, you shall return all property belonging
to the Group, together with all documents, papers, disks and information,
howsoever stored, relating to the Group and used by you in connection with your
position with the Company.

 

9.   Subject to the proper performance of your obligations to the Company under
this letter of appointment and any applicable law, the Company agrees that you
will be free to accept other appointments, directorships and chairmanships
provided that:

 
 

 

9.1             They do not in any way conflict with the interests of the
Company or any member of the Group; and

 

9.2             They do not restrict you from devoting the necessary time and
attention properly to services to be performed under this letter of appointment;
and

 

9.3          In the event that you become aware of any potential conflicts of
interest, these must be disclosed to the Board and/or the Chief Executive
Officer (the "CEO") of the Company as soon as they become apparent.

 

10.  The performance of individual Directors, the Chairman and the Board and its
committees is evaluated annually. If, in the interim, there are any matters
which cause you concern about your position, you should discuss them with the
Board and/or the CEO as soon as is appropriate.

 

11.   In addition to any right pursuant to applicable law, occasions may arise
when you consider that you need professional advice in the furtherance of your
duties as a director. Circumstances may occur when it will be appropriate for
you to seek such advice from independent advisors at the Company’s expense, to
the extent provided under applicable law and subject to the prior written
approval of the CEO and/or the Board.

 

12.   This letter refers to your appointment as a Director of the Company and
your (possible) membership on the committees of the Board.

 

13.    You shall ensure that you comply at all times with the Company’s inside
trading policies as in effect from time to time.

 

14.     You shall discharge your general duties as a Director pursuant to the
Company's Articles of Incorporation and applicable law.

 

15.     This letter of appointment shall be governed by and construed in
accordance with the law of the State of Massachusetts.

Please sign the attached copy of this letter and return it to Xenetic to signify
your acceptance of the terms set out above.

 

Sincerely yours,

 

XENETIC BIOSCIENCES INC.

 

 

 

/s/ M. Scott Maguire

Name: M. Scott Maguire Title: Chief Executive Officer

 

AGREED AND ACKNOWLEDGED BY:

 

 

/s/ Roger D. Kornberg

Name of Director: Roger D. Kornberg