Exhibit 10.27

 

TRANSITION AND SEPARATION AGREEMENT

 

This Transition and Separation Agreement (the “Agreement”) is made effective as
of the eighth (8th) day following the date Executive signs this Agreement (the
“Effective Date”) by and between Graham Cooper (“Executive”) and Geron
Corporation (the “Company”), with reference to the following facts:

 

A.                                    Executive’s employment with the Company
will end effective upon the Termination Date (as defined below).

 

B.                                    Executive and the Company want to end
their relationship amicably and also to establish the obligations of the parties
including, without limitation, all amounts due and owing to the Executive.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, the parties agree as follows:

 

1.        Employment Separation Date.  Executive acknowledges and agrees that
his status as an officer and employment with the Company will end effective as
of December 7, 2012 (the “Termination Date”).

 

2.                    Stock Options.  The attached Exhibit A details Executive’s
vested and unvested options.  Upon the Termination Date, Executive’s options
shall cease vesting and any unvested options as of such date shall automatically
terminate for no consideration, provided, that Executive’s outstanding vested
options shall remain exercisable until the earlier of: (i) the second (2nd)
anniversary of the Termination Date or (ii) the original expiration date of the
applicable option.  If, by the date that is twenty-four (24) months following
the Termination Date, Executive has not exercised the outstanding vested options
in accordance with the procedures set forth in Executive’s option agreements;
such options shall terminate and be of no further effect.  Nothwithstanding the
immediately preceeding sentence, in the event Executive is in possession of
material, non-public information about the Company, or the Company has
prohibited Executive from selling Company stock on or within 30 days of the
second anniversary of the Termination Date, then each of Executive’s outstanding
options for vested shares shall remain exercisable until the earlier of (i) the
date that is 30 days after the Executive is no longer in possession of material
non-public information about the Company and/or the date that is 30 days after
the Company removes its prohibition regarding the Executive’s ability to sell
Company stock, or (ii) the original 10 year expiration date of the applicable
option.  Executive’s unvested options shall be forfeited as of the Termination
Date.  Executive’s outstanding incentive stock options (ISOs) (vested and
unvested) will convert to nonstatutory stock options (NSOs) if not exercised by
the three month anniversary of the Termination Date, in accordance with
applicable law.  In addition, and notwithstanding the foregoing, Executive
acknowledges that upon the execution of this Agreement, each unexercised
“incentive stock option” within the meaning of the Internal Revenue Code of
1986, as amended (the “Code”), shall be deemed modified for the purposes of
Section 424

 

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of the Code, and, to the extent the exercise price thereof is less than the fair
market value of a share of Company common stock on the date this Agreement is
executed, such option shall no longer qualify as an incentive stock option. 
This conversion shall not affect the exercisability or vesting schedule of such
options.

 

3.                    Final Paycheck.  As soon as administratively practicable
on or after the Termination Date, the Company will pay Executive all accrued but
unpaid base salary, earned bonus and all accrued and unused vacation earned
through the Termination Date, subject to standard payroll deductions and
withholdings.  For clarification, the bonus payment shall be: (i) up to
forty-five percent (45%) of Executive’s current annual salary on a pro-rata
basis through December 7, 2012 ($157,654), less applicable withholding taxes.  
Executive is entitled to these payments regardless of whether Executive executes
this Agreement.

 

4.                    Separation Payment and Benefits.  Without admission of any
liability, fact or claim, the Company hereby agrees, subject to Executive
signing and delivering to the Company this Agreement, this Agreement becoming no
longer subject to revocation as provided in Section 6(c)(iii), and Executive’s
continued performance of his obligations under the Confidentiality Agreement to
provide Executive the benefits set forth below.  Specifically, the Company and
Executive agree as follows:

 

(a)                                 Cash Severance.  On or within twenty (20)
days after the Termination Date, the Company shall pay to Executive a lump sum
cash payment in an amount equal to $375,000, less applicable withholding taxes,
which constitutes twelve (12) months of Executive’s base salary as in effect as
of immediately prior to the Termination Date.

 

(b)                                 Additional Condition on Receipt of Cash
Severance and Retention Payment.  The payments in Sections 4(a) and (4b) are
subject to the provisions contained in Section 6(d).

 

(c)                                  No Access to Benefits. Executive shall not
be entitled to participate in any equity incentive pool after the Termination
Date.  Although Executive will be entitled to continue participating in the
Company’s 401(k) plan until the Termination Date, Executive shall not be
entitled to any Company match for any payments made into such plan during 2012.

 

(d)                                 Continued Healthcare.   Subject to
Executive’s timely election of coverage, for the twelve (12) month period
commencing on the Termination Date, the Company shall reimburse Executive’s
COBRA premiums for Medical, Dental and Vision coverage  for Executive and
Executive’s covered dependents as in effect immediately prior to the Termination
Date.  Executive acknowledges that he shall be solely responsible for all
matters relating to Executive’s continuation of health care benefit coverage,
including, without limitation, Executive’s election of such coverage and his
timely payment of premiums.

 

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(e)                                  SEC Reporting.  Executive acknowledges that
to the extent required by the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), he will have continuing obligations under Section 16(a) and
16(b) of the Exchange Act to report his transactions in Company common stock for
(6) six months following the Termination Date.  Executive hereby agrees to abide
by all securities laws pertaining to his trading in the common stock of the
Company including, as required, seeking advance clearance from the Company for
any such trade.

 

(f)                                   Other Obligations. Except as necessary to
perform the Transition Services, Executive hereby agrees to return all
Proprietary Information (as defined in the Confidentiality Agreement) to the
Company and shall certify to the Company within thirty (30) days that all
Proprietary Information has been returned to the Company or destroyed.

 

(g)                                 Taxes.  Executive understands and agrees
that all payments under Section 4 of this Agreement will be subject to
appropriate tax withholding and other deductions.  To the extent any taxes may
be payable by the Executive for the benefits provided to him under Section 4 of
this Agreement beyond those withheld by the Company, Executive agrees to pay
them himself and to indemnify and hold the Company and the other entities
released herein harmless for any tax claims or penalties, and associated
attorneys’ fees and costs, resulting from any failure by him to make required
payments.

 

(h)                                 Reimbursements.  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 31st 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.

 

(i)                                     Sole Separation Benefit.  Executive
agrees that the payments provided by this Section 4 are not required under the
Company’s normal policies and procedures and are provided as a severance solely
in connection with this Agreement.  Executive acknowledges and agrees that the
payments referenced in this Section 4 constitute adequate and valuable
consideration, in and of themselves, for the promises contained in this
Agreement.

 

5.                                      Full Payment.  Executive acknowledges
that the payment and arrangements herein shall constitute full and complete
satisfaction of any and all amounts properly due and owing to Executive as a
result of his employment with the Company and the termination thereof.

 

6.                                      Executive’s Release of the Company. 
Executive understands that by agreeing to the release provided by this
Section 6, Executive is agreeing not to sue, or otherwise file any claim
against, the Company or any of its employees or other agents for any

 

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reason whatsoever based on anything that has occurred as of the date Executive
signs this Agreement.

 

(a)                                 On behalf of Executive and Executive’s heirs
and assigns, Executive hereby releases and forever discharges the “Releasees”
hereunder, consisting of the Company, and each of its owners, affiliates,
divisions, predecessors, successors, assigns, agents, directors, officers,
partners, employees, and insurers, and all persons acting by, through, under or
in concert with them, or any of them, of and from any and all manner of action
or actions, cause or causes of action, in law or in equity, suits, debts, liens,
contracts, agreements, promises, liability, claims, demands, damages, loss, cost
or expense, of any nature whatsoever, known or unknown, fixed or contingent
(hereinafter called “Claims”), which Executive now has or may hereafter have
against the Releasees, or any of them, by reason of any matter, cause, or thing
whatsoever from the beginning of time to the date hereof, including, without
limiting the generality of the foregoing, any Claims arising out of, based upon,
or relating to Executive’s hire, employment, remuneration or resignation by the
Releasees, or any of them, including without limitation any and all Claims
arising under federal, state, or local laws relating to employment, claims of
any kind that may be brought in any court or administrative agency, any claims
arising under the Age Discrimination in Employment Act (“ADEA”), as amended, 29
U.S.C. § 621, et seq.; the Title VII of the Civil Rights Act of 1964, as amended
by the Civil Rights Act of 1991, 42 U.S.C. § 2000 et seq.; the Equal Pay Act, as
amended, 29 U.S.C. § 206(d); the Civil Rights Act of 1866, 42 U.S.C. § 1981; the
Family and Medical Leave Act of 1993, 29 U.S.C. § 2601 et seq.; the Americans
with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq.; the False Claims Act ,
31 U.S.C. § 3729 et seq.; the Employee Retirement Income Security Act, as
amended, 29 U.S.C. § 1001 et seq.; the Worker Adjustment and Retraining
Notification Act, as amended, 29 U.S.C.  § 2101 et seq. the Fair Labor Standards
Act, 29 U.S.C. § 215 et seq., the Sarbanes-Oxley Act of 2002; the California
Fair Employment and Housing Act; the California Family Rights Act; the
California Labor Code; California Business & Professions Code Section 17200,
ordinance or statute regarding employment; Claims any other local, state or
federal law governing employment; Claims for breach of contract; Claims arising
in tort, including, without limitation, Claims of wrongful dismissal or
discharge, discrimination, harassment, retaliation, fraud, misrepresentation,
defamation, libel, infliction of emotional distress, violation of public policy,
and/or breach of the implied covenant of good faith and fair dealing; and Claims
for damages or other remedies of any sort, including, without limitation,
compensatory damages, punitive damages, injunctive relief and attorney’s fees.

 

(b)                                 Notwithstanding the generality of the
foregoing, Executive does not release any of his rights under this Agreement or
the following Claims:

 

(i)                                     Claims for unemployment compensation or
any state disability insurance benefits pursuant to the terms of applicable
state law;

 

(ii)                                  Claims for workers’ compensation insurance
benefits under the terms of any worker’s compensation insurance policy or fund
of the Company;

 

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(iii)                               Claims to continued participation in certain
of the Company’s group benefit plans pursuant to the terms and conditions of
COBRA;

 

(iv)                              Claims to any benefit entitlements vested as
the date of Executive’s employment termination, pursuant to written terms of any
Company employee benefit plan;

 

(v)                                 Claims for indemnification under California
Labor Code Section 2802, the Company’s Certificate of Incorporation, the
Company’s Bylaws, Delaware General Corporation Law or other applicable law, and
under the terms of any policy of insurance purchased by the Company; and

 

(vi)                              Executive’s right to bring to the attention of
the Equal Employment Opportunity Commission claims of discrimination; provided,
however, that Executive does release Executive’s right to secure any damages for
alleged discriminatory treatment.

 

(c)                                  In accordance with the Older Workers
Benefit Protection Act of 1990, Executive has been advised of the following:

 

i)                                         Executive has the right to consult
with an attorney before signing this Agreement;

 

ii)                                      Executive has been given at least
twenty-one (21) days to consider this Agreement;

 

iii)                                   Executive has seven (7) days after
signing this Agreement to revoke it.  If Executive wishes to revoke this
Agreement, Executive must deliver notice of Executive’s revocation in writing,
no later than 5:00 p.m. on the seventh (7th) day following Executive’s execution
of this Agreement to Human Resources, Geron Corporation, 149 Commonwealth Drive,
Menlo Park, California  94025, fax: (650) 473-8668.

 

(d)                                 The release stated above in this Section 6
is for all Claims preceding the Effective Date.  In consideration for the
promises and undertakings contained in Section  4, you also agree to execute a
General Release of Claims in substantially the form set forth above on the
Termination Date and agree that no Section 4 payments will be owed to you unless
such subsequent General Release of Claims is executed by you.

 

7.                                      Company’s Release of the Executive. The
Company voluntarily releases and discharges the Executive and his heirs,
successors, administrators, representatives and assigns from all Claims which it
now has or may hereafter have against the Executive, by reason of any matter,
cause, or thing whatsoever from the beginning of time to the date hereof 
including, without limiting the generality of the foregoing, any Claims arising
out of, based upon, or relating to Executive’s employment with the Company and
any and all Claims arising under federal, state, or local laws.  Notwithstanding
the foregoing, nothing herein shall release or discharge any Claim by the
Company against the Executive, or the right of the Company to bring any action,
legal or otherwise, against the Executive as a result of any

 

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failure by him to perform his obligations under this Agreement or the
Confidentiality Agreement or as a result of any acts for which the Executive
cannot be indemnified by the Company.

 

8.                                      Waiver of Unknown Claims.  EXECUTIVE AND
THE COMPANY ACKNOWLEDGE THAT THEY HAVE BEEN ADVISED OF AND ARE FAMILIAR WITH THE
PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH, IF KNOWN BY HIM OR HER, MUST HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR.”

 

BEING AWARE OF SAID CODE SECTION, THE COMPANY AND EXECUTIVE HEREBY EXPRESSLY
WAIVE ANY RIGHTS THEY OR EITHER OF THEM MAY HAVE THEREUNDER, AS WELL AS UNDER
ANY OTHER STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT, TO THE EXTENT OF
THEIR RESPECTIVE RELEASES.

 

9.                                      Non-Disparagement, Transition, Transfer
of Company Property and Limitations on Service.  Executive further agrees that:

 

a)                                     Non-Disparagement.  Executive agrees that
he shall not disparage, criticize or defame the Company, its affiliates and
their respective affiliates, directors, officers, agents, partners, shareholders
or employees, either publicly or privately.  The Company agrees that it shall
not, and it shall instruct its officers and members of its Board of Directors to
not, disparage, criticize or defame Executive, either publicly or privately. 
Nothing in this Section 9(a) shall have application to any evidence or testimony
required by any court, arbitrator or government agency.

 

b)                                     Transition.  Each of the Company and the
Executive shall use their respective reasonable efforts to cooperate with each
other in good faith to facilitate a smooth transition of Executive’s duties to
other executive(s) of the Company.

 

c)                                      Transfer of Company Property.  Except as
otherwise contemplated in Section 4(g) hereof, on or before the Termination
Date, Executive shall turn over to the Company all files, memoranda, records,
and other documents, and any other physical or personal property which are the
property of the Company and which he had in his possession, custody or control
at the time he signed this Agreement.

 

d)                                     Limit on Post-Termination Service. 
Notwithstanding anything in this Agreement to the contrary, the aggregate level
of bona-fide services to be performed under Sections 2 and 15 of this Agreement,
together with any other services to be performed by Executive for the Company
following the Termination Date, shall in no event exceed twenty percent (20%) of
the average level of bona-fide services performed by

 

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Executive for the Company during the thirty-six (36)-month period preceding the
Termination Date.

 

10.                               Executive and Company Representations. 
Executive warrants and represents that (a) he has not filed or authorized the
filing of any complaints, charges or lawsuits against the Company or any
affiliate of the Company with any governmental agency or court, and that if,
unbeknownst to Executive, such a complaint, charge or lawsuit has been filed on
his behalf, he will immediately cause it to be withdrawn and dismissed, (b) he
has reported all hours worked as of the date of this Agreement and has been paid
all compensation, wages, bonuses, commissions, and/or benefits to which he may
be entitled and no other compensation, wages, bonuses, commissions and/or
benefits are due to him, except as provided in this Agreement, (c) he has no
known workplace injuries or occupational diseases and has been provided and/or
has not been denied any leave requested under the Family and Medical Leave Act
or any similar state law, (d) the execution, delivery and performance of this
Agreement by the Executive does not and will not conflict with, breach, violate
or cause a default under any agreement, contract or instrument to which the
Executive is a party or any judgment, order or decree to which the Executive is
subject, and (e) upon the execution and delivery of this Agreement by the
Company and the Executive, this Agreement will be a valid and binding obligation
of the Executive, enforceable in accordance with its terms.  The Company
warrants and represents that (a) it has not filed or authorized the filing of
any complaints, charges or lawsuits against the Executive with any government
agency or court and that if, unbeknownst to the Company, such a complaint,
charge or lawsuit has been filed on its behalf, it will immediately cause it to
be withdrawn and dismissed and (b) upon the execution and delivery of this
Agreement by the Company and the Executive, this Agreement will be a valid and
binding obligation of the Company, enforceable in accordance with its terms.

 

11.                               No Assignment.  Executive warrants and
represents that no portion of any of the matters released herein, and no portion
of any recovery or settlement to which Executive might be entitled, has been
assigned or transferred to any other person, firm or corporation not a party to
this Agreement, in any manner, including by way of subrogation or operation of
law or otherwise.  If any claim, action, demand or suit should be made or
instituted against the Company or any affiliate of the Company because of any
actual assignment, subrogation or transfer by Executive, Executive agrees to
indemnify and hold harmless the Company or any affiliate of the Company against
such claim, action, suit or demand, including necessary expenses of
investigation, attorneys’ fees and costs.  The Company warrants and represents
that no portion of any of the matters released herein, and no portion of any
recovery or settlement to which the Company might be entitled, has been assigned
or transferred to any other person, firm or corporation not a party to this
Agreement, in any manner, including by way of subrogation or operation of law or
otherwise.  If any claim, action, demand or suit should be made or instituted
against the Executive or any affiliate of the Executive because of any actual
assignment, subrogation or transfer by the Company, the Company agrees to
indemnify and hold harmless the Executive or any affiliate of the Executive
against such claim, action, suit or demand, including necessary expenses of
investigation, attorneys’ fees and costs.

 

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12.                               Governing Law.  This Agreement shall be
construed and enforced in accordance with, and the rights of the parties shall
be governed by, the laws of the State of California or, where applicable, United
States federal law, in each case, without regard to any conflicts of laws
provisions or those of any state other than California.

 

13.                               Miscellaneous.  This Agreement, together with
the Confidentiality Agreement, is the entire agreement between the parties with
regard to the subject matter hereof and shall supersede in its entirety the
Employment Agreement.  The Company and Executive acknowledge that the
termination of the Executive’s employment with the Company is intended to
constitute an involuntary separation from service for the purposes of
Section 409A of the Code, and the related Department of Treasury regulations. 
The Company agrees not to oppose any claim that Executive may make for
unemployment compensation; provided that the Company has the right to respond
truthfully to any inquiries made by the California Employment Development
Department (“EDD”) regarding such a claim by Executive, and to provide all
documents and information requested by the EDD.  Executive acknowledges that
there are no other agreements, written, oral or implied, and that he may not
rely on any prior negotiations, discussions, representations or agreements. 
This Agreement may be modified only in writing, and such writing must be signed
by both parties and recited that it is intended to modify this Agreement.  This
Agreement may be executed in separate counterparts, each of which is deemed to
be an original and all of which taken together constitute one and the same
agreement.  Executive shall have no duty to mitigate any breach by the Company
of its obligations under Sections 2, 3 and 4 of this Agreement.

 

14.                               Indemnification.  Nothing in this Agreement
shall in any way limit or terminate the Company’s continuing obligation to
indemnify, defend and/or hold harmless Executive under his Idemnification
Agreement with the Company (or any other applicable written indemnification
obligation), or the Company’s Certificate of Incorporation, the Company’s
Bylaws, Delaware General Corporation Law or other applicable legal requirement. 
The Company shall maintain directors’ and officers’ liability insurance coverage
for the continuing protection of the Executive, of such types and in such
amounts as shall be appropriate for the size of the Company and its business
risks.

 

(Signature page(s) follow)

 

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IN WITNESS WHEREOF, the undersigned have caused this Transition and Separation
Agreement to be duly executed and delivered as of the date indicated next to
their respective signatures below.

 

DATED:

December 5, 2012

 

 

 

/s/ Graham Cooper

 

Graham Cooper

 

 

 

 

 

GERON CORPORATION

DATED:

December 5, 2012

 

 

 

 

 

By:

/s/ John A. Scarlett

 

 

John A. Scarlett, M.D.

 

 

President and Chief Executive Officer

 

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EXHIBIT A

 

GRANT STATUS AS OF TERMINATION DATE

 

A-1

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