Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement (this “Agreement”) is entered into as of October 30,
2020 by and between iBio, Inc., a Delaware corporation (the “Company” or
“iBio”), and Randy J. Maddux (the “Executive”). The Effective Date of this
Agreement shall be December 1, 2020 provided Executive satisfactorily completes
all pre-employment procedures (including, but not limited to a background check)
in the sole discretion of the Company. If this Agreement is not executed by
Executive by October 30, 2020, it shall be null and void. If Executive fails to
satisfactorily complete all such pre-employment procedures, this Agreement shall
be null and void. In consideration of the premises and mutual covenants
contained herein, and intending to be legally bound, the parties agree as
follows:

 

1.     Employment.

 

(a)   Position. On the terms and subject to the conditions set forth in this
Agreement, the Company shall employ the Executive and the Executive shall serve
the Company as “Chief Operating Officer.”

 

(b)   Duties. The Executive’s duties and reporting structure shall be prescribed
from time to time by the Chief Executive Officer and shall include such
responsibilities as are customary for employees performing functions similar to
those of the Executive. In addition, the Executive shall serve at no additional
compensation in such executive capacity or capacities with respect to any
subsidiary or affiliate of the Company to which he may assigned, provided that
such duties are not inconsistent with those of a Chief Operating Officer. The
Executive shall devote substantially all of the Executive’s time and attention
to the performance of the Executive’s duties and responsibilities for and on
behalf of the Company except as set forth herein or as may be consented to by
the Company. Executive acknowledges and agrees that if the Company opens an
office within a one-hour drive from Executive’s current home, Executive shall be
required to work from such office as assigned by the Chief Executive Officer. In
addition, Executive shall be required to travel to any Company office,
including, but not limited to, the facility in Texas, as assigned by the Chief
Executive Officer.

 

(c)   Outside Activities. Notwithstanding anything to the contrary herein,
Executive shall be permitted: (i) to serve as a member of the board of directors
or advisory board (or their equivalents in the case of a non-corporate entity)
of any (A) charitable or philanthropic organization; (ii) to engage in
charitable, community or philanthropic activities or any other activities; or
(iii) to serve as an executor, trustee or in a similar fiduciary capacity;
provided, that the activities set out in the foregoing clauses shall be limited
by the Executive so as not to affect, interfere or conflict with, individually
or in the aggregate, the performance of the Executive's duties and
responsibilities. Any outside activities in excess of the foregoing shall
require the consent of the Chief Executive Offer.

 

(d)  Company Policies. The employment relationship between the parties shall
also be subject to the Company’s personnel policies and procedures as they may
be interpreted, adopted, revised or deleted from time to time in the Company’s
sole discretion. Notwithstanding the foregoing, in the event that the terms of
this Agreement differ from or are in conflict with the Company’s general
employment policies or practices, this Agreement shall control.

 

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2.     At-will Employment. Subject to the provisions of section 4 of this
Agreement, Executive shall be employed on an at-will basis. Neither this
Agreement nor any of the Company’s policies, practices or procedures constitute
an expressed or implied contract of employment. Employment at the Company and
its affiliates is a voluntary employment “at-will” relationship for no definite
period of time which affords either party the right to terminate the
relationship at any time for any reason or for no reason at all not prohibited
by law.

 

3.     Compensation. The Executive shall receive, for all services rendered to
the Company pursuant to this Agreement, the following:

 

(a)   Base Salary. The Employee shall be paid a base salary at the rate of Three
Hundred Ninety Thousand Dollars ($390,000.00) per annum (“Base Salary”), less
such deductions for withholding taxes required under applicable law or as
otherwise authorized by the Executive. The Base Salary shall accrue from and
after the Effective Date, and shall be payable during the Term in equal periodic
installments in accordance with Company’s then current general salary payment
policies. The Executive’s Base Salary shall be reviewed from time to time by the
Compensation Committee of the Board (“Compensation Committee”), and may be
increased based upon the evaluation of the Executive’s performance and the
compensation policies of the Company in effect at the time of each such review.

 

(b)  Bonus. Executive shall be eligible for a target bonus of 40% of the base
salary paid to Executive during the prior fiscal year based upon the
Compensation Committee’s assessment of his performance and the performance of
the Company during the prior fiscal year. In all events, any bonus awarded
pursuant to this Section 3(b) will be paid within 2-1/2 months following the end
of the fiscal year for which it is earned.

 

(c)   Sign-On Bonus. Executive shall be eligible to receive a bonus of $160,000,
less all lawful deductions, upon the Effective Date of this Agreement. The bonus
shall be paid to Executive within thirty (30) days of the Effective Date of this
Agreement. Executive shall return the bonus to the Company if Executive resigns
without good reason within twelve months of the Effective Date of this
Agreement.

 

(d)  Option and Restricted Stock Unit (“RSU”) Grant. Executive shall receive an
initial grant of options to purchase 465,000 shares of iBio common stock based
on the grant date stock price, subject to conditions of applicable law and the
iBio, Inc. 2018 Omnibus Equity Incentive Plan, as amended from time to time, and
any successor Plan (“Plan”) and grant agreement issued thereunder (or as an
inducement award issued with reference to the terms of the Plan). Such options
will vest at the following rates: (1) 25% of options granted will vest after one
year of employment with the Company; and (2) after one year of employment with
the Company, 6.25% of the options granted will vest for each additional 3 months
of employment, subject to the conditions of the Plan and grant agreement.
Executive shall also receive an initial grant of 309,000 RSUs. Such RSUs will
vest in even increments on the first three anniversaries of grant, subject to
the conditions of the Plan and grant agreement. The Executive shall also be
eligible for additional grants of equity compensation from time to time, in a
similar manner to other similarly situated executives, subject to the Company
grant policy and applicable approvals of grants.

 

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(e)   Benefits. During the Term, the Company shall provide the Executive with
the following benefits:

 

(i)     Company Plans. The Executive and his dependents (as that term may be
defined under the applicable benefit plan(s) of the Company) shall be included,
if and to the extent eligible thereunder, in any and all standard benefit plans,
programs and policies of the Company provided to similarly situated executives
(“Benefits Plans”). The Executive acknowledges and agrees that the Benefits
Plans may from time to time be modified by the Company as it deems necessary and
appropriate.

 

(ii)    Paid Time Off. During the Term, the Executive shall be entitled to paid
vacation, paid holidays and other paid time off (“PTO”) for which executives of
the Company are generally eligible, in each case consistent with Company policy
in effect from time to time. Any PTO unused at the end of a calendar year is
forfeited. The Executive shall not be entitled to any payments for unused PTO
upon the Executive’s termination or resignation from employment for any reason.

 

(iii)   Insurance. The Executive shall receive coverage under the Company’s
Directors and Officers Liability Insurance under terms and conditions
substantially similar to other executives of the Company. The Executive
acknowledges and agrees that such insurance may from time to time be modified by
the Company as it deems necessary and appropriate.

 

(f)    Withholding. The Company is authorized to deduct and withhold from the
Executive’s compensation all sums authorized by the Executive or necessary or
required (whether by law, court decree, executive order or otherwise),
including, but not limited to, social security, income tax withholding and
otherwise, and any other amounts required by law or any taxing authority.

 

(g)   Expenses. The Company shall reimburse the Executive for all reasonable
out-of-pocket expenses incurred by the Executive in connection with the
performance of the Executive's duties and responsibilities hereunder, upon
presentment of a valid receipt or other usual and customary documents evidencing
such expenses. The Company will reimburse properly substantiated and timely
submitted expenses in accordance with Company policy.

 

4.     Termination.

 

(a)   General. The employment of the Executive hereunder (and this Agreement)
shall be terminable as described in Section 2 subject to the provisions of this
Section 4.

 

(b)   Termination Upon Mutual Agreement. The Company and the Executive may, by
mutual written agreement, terminate the employment of the Executive hereunder
(and this Agreement) at any time, in which case the Executive will be entitled
only to the Standard Termination Benefits (as defined in Section 4(i)).

 

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(c)   Termination by the Company for Cause. The employment of the Executive
hereunder (and this Agreement) shall be terminated (but after the expiration of
the cure period described in clause (v) below, if applicable), at the option of
the Company, for “Cause” (as defined herein), upon written notice to the
Executive specifying the subsection(s) of the definition of Cause relied on to
support the decision to terminate, in which event the Company shall have no
further obligations or liabilities under this Agreement (including, without
limitation, Section 3 hereof) except to pay to the Executive the Standard
Termination Benefits. Termination by the Company for Cause shall be effective
immediately after the Company gives notice to Executive of Executive’s
termination, unless the Company specifies a later date, in which case,
termination shall be effective as of such later date; provided that no effective
date of termination shall precede the expiration of the cure period described in
clause (v) below, if applicable. For purposes of this Agreement, “Cause” means:
(i) an act of personal dishonesty in connection with the Executive’s
responsibilities as an employee of the Company that is intended to result in
personal enrichment of the Executive; (ii) Executive’s commission of a felony or
other crime involving theft, fraud or moral turpitude which the Company
reasonably believes has had or could have a material detrimental effect on the
Company’s reputation or business; (iii) a breach of any fiduciary duty owed to
the Company that has, or reasonably could have, a material detrimental effect on
the Company’s reputation or business as determined in good faith by the Company;
(iv) willful violations of the Executive’s obligations to the Company; or (v)
the material breach by the Executive of any material obligation imposed upon the
Executive pursuant to this Agreement or any other material policy of the Company
if (in the event such failure is reasonably susceptible of cure) such failure
continues uncured for thirty (30) days after written notice specifying in
reasonable detail such failure.

 

(d)   Termination by the Company without Cause. The employment of the Executive
hereunder (and this Agreement) may be terminated at any time, at the option of
the Company without Cause. Termination by the Company without Cause shall be
effective immediately after the Company gives notice to Executive of Executive’s
termination, unless the Company specifies a later date, in which case,
termination shall be effective as of such later date.

 

(e)   Termination Upon Death of Executive. This Agreement will terminate
automatically upon the death of the Executive, in which event the Company shall
have no further obligations or liabilities under this Agreement (including,
without limitation, Section 3 hereof) except to pay to the Executive’s estate or
his personal representative, as the case may be, the Standard Termination
Benefits.

 

(f)    Termination Upon Disability of Executive. The employment of the Executive
hereunder (and this Agreement) shall be terminated, at the option of the
Company, upon not less than thirty (30) days prior written notice to the
Executive or his legal representative, as the case may be, in the event the
Executive suffers a “Total Disability” (as defined below), in which event the
Company shall have no further obligations or liabilities under this Agreement
(including, without limitation, Section 3 hereof) except to pay to the Executive
or his legal representative, as the case may be, the Standard Termination
Benefits. “Total Disability” shall the determination by the Company, that,
because of a medically determinable disease, condition, injury or other physical
or mental disability, the Executive is unable to substantially perform the
duties of the Executive required hereby, and that such disability is determined
or reasonably expected to last for a period of twelve weeks in a twelve month
period unless a longer period is required by applicable law. This definition
shall be interpreted and applied consistent with the Americans with Disabilities
Act, the Family and Medical Leave Act, and other applicable law.

 

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(g)   Resignation by the Executive for Good Reason. The Executive shall be able
to terminate this Agreement for Good Reason by providing written notice of
termination to the Company within thirty (30) days after expiration of the cure
period described in the last sentence of this Section 4(g). For purposes of this
Agreement, “Good Reason” means, with respect to the Executive, in each case to
the extent not consented by the Executive: (i) a material diminution in
Executive’s base salary (unless applied proportionately to all similarly
situated executives), (ii) assignment to a primary worksite different than
described in section 1(b) of this Agreement; (iii) a material violation of this
Agreement or any other material agreement between the Executive and the Company,
by the Company; (iv) any assignment of duties to the Executive that would
require an unreasonable amount of the Executive's work time and that are duties
which customarily would be discharged by persons junior or subordinate in status
to the Executive within the Company as determined in good faith by the Executive
and taking into consideration trends and customs in the market and industry in
which the Company operates; provided that the Executive shall not have Good
Reason unless the Executive shall have provided the Company written notice
describing such violation in sufficiently reasonable detail for the Company to
understand the breach alleged to have occurred, with such notice provided to the
Company no later than ten (10) days after the alleged breach first occurs, and
the Company shall fail to cure such alleged breach within thirty (30) days after
the Executive has provided the Company the required notice.

 

(h)   Resignation by the Executive without Good Reason. The employment of the
Executive hereunder (and this Agreement) may be terminated, at the option of the
Executive, without Good Reason, upon thirty (30) days’ prior written notice from
the Executive to the Company, in which event the Company shall have no further
obligations or liabilities under this Agreement (including, without limitation,
Section 3 hereof) except to pay to the Executive the Standard Termination
Benefits.

 

(i)    Standard Termination Benefits in the Event of Separation from Employment.
In the event that the Executive separates from employment for any reason or no
reason, the Company shall pay to the Executive within thirty (30) days of such
termination: (i) accrued and unpaid Base Salary in accordance with Section 3(a);
(ii) any unreimbursed expenses payable in accordance with Section 4; and (iii)
any amounts payable under any of the benefit plans of the Company in which the
Executive was a participant in accordance with applicable law and the terms of
those plans (collectively, the “Standard Termination Benefits”).

 

(j)    Severance. If the Company terminates the Executive’s employment without
cause, provided the Executive executes and does not revoke a Separation
Agreement in a form acceptable to the Company, the Executive shall receive: (i)
an amount equal to the Executive’s then current Base Salary for nine (9) months
(the “Severance Period”), less all applicable withholdings and deductions paid
in equal installments in accordance with the Company’s regular payroll dates,
(ii) any pro rata share of the bonus earned by Executive during the fiscal year
in which occurs Executive’s separation from employment, within thirty (30) days
of Executive’s execution of a Separation Agreement; and (iii) provided Executive
elects continuation coverage for health insurance under the Consolidated Omnibus
Budget Reconciliation Act of 1985 (“COBRA”), the Company will pay the full cost
of this benefit for the Severance Period. Notwithstanding the foregoing, timing
of payments under this Section 4(j) shall be subject to Section 7 (relating to
Section 409A of the Internal Revenue Code).

 

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(k)   Separation After a Change in Control. If the Company terminates the
Executive’s employment without Cause within twelve (12) months after a “change
in control” (as defined in the Plan), or the Executive terminates employment
with the Company for Good Reason within twelve (12) months after a “change in
control” (as defined in the Plan), provided the Executive executes and does not
revoke a Separation Agreement in a form acceptable to the Company, the Executive
shall receive (i) an amount equal to the Executive’s then current Base Salary
for twelve months (12) months (the “Severance Period”), less all applicable
withholdings and deductions paid in equal installments in accordance with the
Company’s regular payroll dates, (ii) an amount equal to the target bonus for
which Executive would have been eligible during the Company fiscal year in which
the Executive terminates employment, within thirty (30) days of Executive’s
execution of a Separation Agreement, (iii) vesting of any unvested time-vested
equity awards held by the Executive at such time; and (iv) provided Executive
elects continuation coverage for health insurance under the Consolidated Omnibus
Budget Reconciliation Act of 1985 (“COBRA”), the Company will pay the full cost
of this benefit for the Severance Period. Notwithstanding the foregoing, timing
of payments under this Section 4(j) shall be subject to Section 7 (relating to
Section 409A of the Internal Revenue Code).

 

5.     Assignment of Intellectual Property Rights. In consideration of his
employment, the Executive agrees to be bound by this Section 5.

 

(a)   General. The Executive agrees to assign, and hereby assigns, to the
Company all of his rights in any Inventions (as hereinafter defined) (including
all Intellectual Property Rights (as hereinafter defined) therein or related
thereto) that are made, conceived or reduced to practice, in whole or in part
and whether alone or with others, by him during his employment by, or service
with, the Company or which arise out of any activity conducted by, for or under
the direction of the Company (whether or not conducted at the Company's
facilities, working hours or using any of the Company's assets), or which are
useful with, or relate directly or indirectly to, any Company Interest (as
defined below). The Executive will promptly and fully disclose and provide all
of the Inventions described above (the “Assigned Inventions”) to the Company.

 

(b)   Assurances. The Executive hereby agrees, during the Term and thereafter,
to further assist the Company, at the Company’s expense, to evidence, record and
perfect the Company’s rights in and ownership of the Assigned Inventions, to
perfect, obtain, maintain, enforce and defend any rights specified to be so
owned or assigned and to provide and execute all documentation necessary to
effect the foregoing.

 

(c)   Definitions. “Company Interest” means any business of the Company or any
product, service, Invention or Intellectual Property Right that is used or under
consideration or development by the Company. “Intellectual Property Rights”
means any and all intellectual property rights and other similar proprietary
rights in any jurisdiction, whether registered or unregistered, and whether
owned or held for use under license with any third party, including all rights
and interests pertaining to or deriving from: (a) patents and patent
applications, reexaminations, extensions and counterparts claiming property
therefrom; inventions, invention disclosures, discoveries and improvements,
whether or not patentable; (b) computer software and firmware, including data
files, source code, object code and software-related specifications and
documentation; (c) works of authorship, whether or not copyrightable; (d) trade
secrets (including those trade secrets defined in the Uniform Trade Secrets Act
and under corresponding statutory law and common law), business, technical and
know-how information, non-public information, and confidential information and
rights to limit the use of disclosure thereof by any person; (e) trademarks,
trade names, service marks, certification marks, service names, brands, trade
dress and logos and the goodwill associated therewith; (f) proprietary databases
and data compilations and all documentation relating to the foregoing, including
manuals, memoranda and record; (g) domain names; and (h) licenses of any of the
foregoing; including in each case any registrations of, applications to
register, and renewals and extensions of, any of the foregoing with or by any
governmental authority in any jurisdiction. “Invention” means any products,
process, ideas, improvements, discoveries, inventions, designs, algorithms,
financial models, writings, works of authorship, content, graphics, data,
software, specifications, instructions, text, images, photographs, illustration,
audio clips, trade secrets and other works, material and information, tangible
or intangible, whether or not it may be patented, copyrighted or otherwise
protected (including all versions, modifications, enhancements and derivative
work thereof).

 

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6.     Restrictive Covenants. The Executive acknowledges and agrees that he has
and will have access to secret and confidential information of the Company, its
affiliates, and its subsidiaries (“Confidential Information”) and that the
following restrictive covenants are necessary to protect the interests and
continued success of the Company. As used in this Agreement, Confidential
Information includes, without limitation, all information of a technical or
commercial nature (such as research and development information, patents,
trademarks and copyrights and applications thereto, formulas, codes, computer
programs, software, methodologies, processes, innovations, software tools,
know-how, knowledge, designs, drawings specifications, concepts, data, reports,
techniques, documentation, pricing information, marketing plans, customer and
prospect lists, trade secrets, financial information, salaries, business
affairs, suppliers, profits, markets, sales strategies, forecasts and personnel
information), whether written or oral, relating to the business and affairs of
the Company, its customers and/or other business associates which has not been
made available to the general public.

 

(a)   Confidentiality. The Executive shall not disclose any Confidential
Information to any person or entity at any time during the Term or after the
separation of Executive from employment with the Company.

 

(b)  Non-Compete. In consideration of the employment hereunder, the Executive
agrees that during his employment and for a period of one (1) year thereafter,
the Executive will not (and will cause any entity controlled by the Executive
not to), directly or indirectly, whether or not for compensation and whether or
not as an employee, be engaged in or have any financial interest in any business
competing with or which may compete with the business of the Company within any
state within the United States or solicit, advise, provide services or products
of the same or similar nature to services or products of the Company to any
person or entity. For purposes of this Agreement, the Executive will be deemed
to be engaged in or to have a financial interest in such competitive business if
he is an executive, officer, director, shareholder, joint venturer, salesperson,
consultant, investor, advisor, principal or partner, of any person, partnership,
corporation, trust or other entity which is engaged in such a competitive
business, or if he directly or indirectly performs services for such an entity
in a capacity the same as or similar to that which Executive performed for the
Company; provided, however, that the foregoing will not prohibit the Executive
from owning, for the purpose of passive investment, less than 2% of any class of
securities of a publicly held corporation or performing work for competitive
business if such work is not similar to the work performed by Executive for the
Company.

 

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(c)   Non-Solicitation/Non-Interference. The Executive agrees that during the
Term and for an additional one (1) year after the separation of Executive from
employment with the Company, the Executive shall not (and shall cause any entity
controlled by the Executive not to), directly or indirectly: (i) solicit,
request or otherwise attempt to induce or influence, directly or indirectly, any
present client, distributor, licensor or supplier, or prospective client,
distributor, licensor or supplier, of the Company, or other persons sharing a
business relationship with the Company, to cancel, limit or postpone their
business with the Company, or otherwise take action which might cause a
financial disadvantage of the Company; or (ii) hire or solicit for employment,
directly or indirectly, or induce or actively attempt to influence, any
employee, officer, director, agent, contractor or other business associate of
the Company, to terminate his or her employment or discontinue such person’s
consultant, contractor or other business association with the Company. For
purposes of this Agreement the term “prospective client” shall mean any person,
group of associated persons or entity whose business the Company has directly
solicited within the one-year period prior to the termination of his employment.

 

(d)   Non-Disparagement. Executive agrees that he will not in any way disparage
the Company, including current or former officers, directors and employees, nor
will he make or solicit any comments, statements or the like to the media or to
others that may be considered to be disparaging, derogatory or detrimental to
the good name or business reputation of the Company.

 

(e)   If the Company, in its reasonable discretion, determines that the
Executive violated any of the restrictive covenants contained in this Section 6,
the applicable restrictive period shall be increased by the period of time from
the commencement of any such violation until the time such violation shall be
cured by the Executive to the satisfaction of the Company. Executive agrees that
a violation of any of the restrictive covenants contained in this Section 6
shall constitute grounds for forfeiture of any equity-based awards granted to
Executive by the Company (regardless of the extent to which Executive has vested
in such awards), and grounds for the Company to recoup from the Executive any
proceeds of equity-based awards granted to Executive by the Company.

 

(f)   In the event that either any scope or restrictive period set forth in this
Section 6 is deemed to be unreasonably restrictive or unenforceable in any court
proceeding, the scope and/or restrictive period shall be reduced to equal the
maximum scope and/or restrictive period allowable under the circumstances.

 

(g)   The Executive acknowledges and agrees that in the event of a breach or
threatened breach of the provisions of this Section 6 by the Executive, the
Company may suffer irreparable harm and, therefore, in advance of arbitration,
the Company shall be entitled to seek immediate injunctive relief restraining
the Executive from such breach or threatened breach of the restrictive covenants
contained in this Section 5 in a court of competent jurisdiction in Brazos
County Texas or if the jurisdiction prerequisites exist, the United States
District Court for the Southern District of Texas. Nothing herein shall be
construed as prohibiting the Company from pursuing any other remedies available
to it in arbitration for such breach or threatened breach, including the
recovery of damages from the Executive. The Company acknowledges and agrees that
in the event of a breach or threatened breach of the provisions of Section by
the Company, the Executive may suffer irreparable reputation harm and,
therefore, the Executive shall be entitled to seek immediate injunctive relief
restraining the Company from such breach or threatened breach of the restrictive
covenants contained in Section. Nothing herein shall be construed as prohibiting
the Executive from pursuing any other remedies available to him for such breach
or threatened breach, including the recovery of damages from the Company.

 

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(h)   Under the federal Defend Trade Secrets Act of 2016 (18 U.S.C. § 1833(b)),
“An individual shall not be held criminally or civilly liable under any Federal
or State trade secret law for the disclosure of a trade secret that—(A) is
made—(i) in confidence to a Federal, State, or local government official, either
directly or indirectly, or to an attorney; and (ii) solely for the purpose of
reporting or investigating a suspected violation of law; or (B) is made in a
complaint or other document filed in a lawsuit or other proceeding, if such
filing is made under seal.” Nothing in this Agreement is intended to conflict
with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets
that are expressly allowed by 18 U.S.C. § 1833(b). Accordingly, the parties to
this Agreement have the right to disclose in confidence trade secrets to
federal, state, and local government officials, or to an attorney, for the sole
purpose of reporting or investigating a suspected violation of law. The parties
also have the right to disclose trade secrets in a document filed in a lawsuit
or other proceeding, but only if the filing is made under seal and protected
from public disclosure.

 

7.     Sections 409A and 280G of the Internal Revenue Code.

 

(a)   Separation from Service. Notwithstanding anything in this Agreement to the
contrary, to the extent that any severance or other payments or benefits paid or
provided to Executive, if any, under this Agreement are considered deferred
compensation subject to Section 409A of the Internal Revenue Code of 1986, as
amended (“Code”) and the final regulations and any guidance promulgated
thereunder (“Section 409A”) (such payments, the “Deferred Payments”), then to
the extent required by Section 409A, no Deferred Payments will be payable unless
Executive’s termination of employment also constitutes a “separation from
service,” as defined in Treasury Regulations Section 1.409A-1(h) (a “Separation
from Service”). Similarly, no Deferred Payments payable to Executive, if any,
under this Agreement that otherwise would be exempt from Section 409A pursuant
to Treasury Regulations Section 1.409A-1(b)(9) will be payable until Executive
has a Separation from Service. For clarity, if Executive’s employment with the
Company is terminated by Executive or the Company (including, without
limitation, by resignation) in a manner entitling Executive to Severance
Benefits, but the Executive does not incur a Separation from Service, then any
severance payments or benefits that are Deferred Payments and that are not
immediately payable under this Section 7(a) will instead be paid to Executive
when Executive incurs a Separation from Service, as if termination of employment
occurred on such date notwithstanding that Executive may no longer be employed
under this Agreement.

 

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(b)   Payment Delay. If, at the time of Executive’s Separation from Service, the
Company determines that Executive is a “specified employee” for purposes of
Section 409A(a)(2)(B)(i) of the Code and that delayed commencement of any
portion of the Deferred Payments is required to avoid a prohibited distribution
under Section 409A(a)(2)(B)(i) of the Code (any such delayed commencement, a
“Payment Delay”), then that portion of the Deferred Payments will not be
provided to Executive until the earlier of (i) the expiration of the six-month
period measured from the date of Executive’s Separation from Service, (ii) the
date of Executive’s death, or (iii) such earlier date as is permitted under
Section 409A. Upon the expiration of the applicable Code Section
409A(a)(2)(B)(i) deferral period, all Deferred Payments deferred under the
Payment Delay will be paid in a lump sum to Executive within 30 days following
such expiration, and any remaining payments due under this Agreement will be
paid as otherwise provided in this Agreement. The determination of whether
Executive is a “specified employee” for purposes of Section 409A(a)(2)(B)(i) of
the Code at the time of Executive’s Separation from Service will be made by the
Company, in its discretion, in accordance with Section 409A (including, without
limitation, Treasury Regulations Section 1.409A-1(i)). For purposes of Section
409A (including, without limitation, for purposes of Treasury Regulations
Section 1.409A-2(b)(2)(iii)), Executive’s right to receive the payments under
this Agreement, including the severance payments and benefits, will be treated
as a right to receive a series of separate payments and, accordingly, each
installment payment will at all times be considered a separate and distinct
payment.

 

(c)   Payment of Severance Upon Execution of a Release of Claims. Severance
payments shall begin upon expiration of the revocation period under the general
release of claims described in Sections 4(d) and (g), and the first payment made
shall include amounts that would have been paid for preceding payroll periods
had the general release of claims been executed and effective immediately upon
the Executive’s termination of employment.  Notwithstanding the foregoing, if
the period for signing and revoking the general release of claims spans two
calendar years, any portion of the severance that is subject to Section 409A
shall not be paid until the first payroll date in the second calendar year
following expiration of the revocation period. 

 

(d)   Expense Reimbursement. If required for compliance with Section 409A of the
Code, any expenses incurred by Executive that are reimbursed by the Company as a
taxable reimbursement under this Agreement will be paid in accordance with
Treasury Regulations Section 1.409A-3(i)(1)(iv) and in accordance with the
Company’s standard expense reimbursement policies, but in any event on or before
the last day of Executive’s taxable year following the taxable year in which
Executive incurred the expenses. The amounts so reimbursed during any taxable
year of Executive will not affect the amounts provided in any other taxable year
of Executive, and Executive’s right to reimbursement for these amounts will not
be subject to liquidation or exchange for any other benefit.

 

(e)   Section 280G of the Code. Notwithstanding any provision of this Agreement
to the contrary, if any payment or benefit the Executive would receive from the
Company pursuant to this Agreement or otherwise (a “Payment”) would (i)
constitute a “parachute payment” within the meaning of Section 280G of the Code
and (ii) but for this Section 7(d), be subject to the excise tax imposed by
Section 4999 of the Code (the “Excise Tax”), then such Payment will be equal to
the Reduced Amount (as defined below). The “Reduced Amount” will be either (1)
the largest portion of the Payment that would result in no portion of the
Payment (after reduction) being subject to the Excise Tax or (2) the entire
Payment, whichever amount after taking into account all applicable federal,
state and local employment taxes, income taxes, and the Excise Tax (all computed
at the highest applicable marginal rate, net of the maximum reduction in federal
income taxes which could be obtained from a deduction of such state and local
taxes), results in the Executive’s receipt, on an after-tax basis, of the
greatest amount of the Payment. If a reduction in the Payment is to be made, the
reduction in payments and/or benefits will occur in the following order: (1)
reduction of cash payments; and (2) reduction of other benefits paid to the
Executive. In the event that acceleration of vesting of equity award
compensation is to be reduced, such acceleration of vesting will be cancelled in
the reverse order of the date of grant of the Executive’s equity awards. This
Section 7(e) shall supersede Section 12.1 of the Plan relating to Section 280G
of the Code.

 

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8.    Attorneys’ Fees. If any action at law or in equity (including arbitration)
is necessary to enforce or interpret the terms of any provision of this
Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees,
costs and necessary disbursements in addition to any other relief to which such
party may be entitled pursuant to the underlying action

 

9.    No Conflicts. The Executive represents and warrants to the Company that
the execution, delivery and performance by the Executive of this Agreement do
not conflict with or result in a violation or breach of, or constitute (with or
without the giving of notice or the lapse of time or both) a default under any
contract, agreement or understanding, whether oral or written, to which the
Executive is a party or by which the Executive is bound and that there are no
restrictions, covenants, agreements or limitations on the Executive’s right or
ability to enter into and perform the terms of this Agreement, and the Executive
agrees to indemnify and save the Company harmless from any liability, cost or
expense, including attorney's fees, based upon or arising out of any breach of
this Section 9.

 

10.   Waiver. The waiver by either party of any breach by the other party of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach by such party. No person acting other than pursuant to a
resolution of the Company shall have authority on behalf of the Company to agree
to amend, modify, repeal, waive or extend any provision of this Agreement.

 

11.  Assignment. This Agreement shall be binding upon and inure to the benefit
of the successors and assigns of the Company. This Agreement shall inure to the
benefit of and be enforceable by the Executive or his legal representatives,
executors, administrators and heirs. The Executive may not assign any of the
Executive’s duties, responsibilities, obligations or positions hereunder to any
person and any such purported assignment by the Executive shall be void and of
no force and effect.

 

12.  Notices. All notices, requests, demands and other communications which are
required or may be given pursuant to this Agreement shall be in writing and
shall be deemed to have been duly given when received if personally delivered;
upon confirmation of transmission if sent by telecopy, electronic or digital
transmission; the day after it is sent, if sent for next day delivery to a
domestic address by recognized overnight delivery service (e.g., Federal
Express); and upon receipt, if sent by certified or registered mail, return
receipt requested. In each case notice shall be sent to:

 

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If to Executive, addressed to: If to the Company, addressed to:

Randy J. Maddux

4738 Plum Road

Monrovia, MD 21770

iBio, Inc.

8800 HSC Parkway

Bryan, TX 77807

ATTN: CEO

Cc: legal@ibioinc.com

 

or to such other place and with such other copies as either party may designate
as to itself by written notice to the others.

 

13.   Miscellaneous.

 

(a)   Governing Law; Jurisdiction/Venue. This Agreement shall be governed by and
its provisions construed and enforced in accordance with the laws of Texas
without reference to its principles regarding conflicts of law.

 

(b)  Arbitration. The Parties mutually agree that any and all claims or
controversies arising out of or relating to Employee’s employment, the
termination thereof, or otherwise arising between Executive and the Company
shall, in lieu of a jury or other civil trial, be settled by final and binding
arbitration. This includes all claims between the parties. The parties also
agree to submit claims to the arbitrator regarding issues of arbitrability, the
validity, scope, and enforceability of this Agreement, jurisdictional issues,
and any other challenges to this Agreement. Nothing in this Agreement shall be
construed to prevent either party’s use of provisional remedies in aid of
arbitration from a court of appropriate jurisdiction including, but not limited
to, claims for temporary or preliminary injunctive relief as described in
section 6. The Parties consent to the jurisdiction of the Brazos County Texas
courts and if the jurisdictional prerequisites exist, the United States District
Court for the Southern District of Texas for such provisional relief. Such
arbitration shall be conducted in accordance with the JAMS Employment
Arbitration Rules & Procedures. Any such arbitration will be conducted in Bryan,
Texas. Except as otherwise provided by applicable law, the administrative costs
of the arbitration (filing fees, cost for the arbitration site, hearing fees,
arbitrator’s fee) shall be divided equally between the parties. In the event
that the applicable rules of JAMS, any express statutory provisions, or
controlling case law conflicts with this allocation and requires the payment of
administrative costs of arbitration by the Company, the administrative costs of
arbitration will be paid by The Company. The Parties agree that to the extent,
if any, Employee may have a non-waivable right to file a claim or charge against
the Company (such as claims for unemployment benefits, workers’ compensation
benefits, or charges of discrimination with the Equal Employment Opportunity
Commission), this Agreement shall not be intended to waive such a right to file.
If Employee or the Company arbitrates a claim against the other, neither the
employee nor the Company shall, without written consent of the other party, have
the right to participate in a class action in court or in arbitration, either as
a class representative or a class member or join or consolidate claims with any
other claims asserted by any other person. In the event any portion of this
agreement is found to be unenforceable, that portion shall not be effective and
the remainder of the agreement shall remain effective.

 

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(c)   Waiver of Jury Trial. To the extent either party is found to have a right
to proceed with any action outside an arbitral forum, the parties hereby waive
their respective rights to a trial by jury, and further agree that no demand,
request or motion will be made for trial by jury.

 

(d)  Severability. In the event that any one or more of the provisions of this
Agreement shall be held to be invalid, illegal or unenforceable, the validity,
legality or enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.

 

(e)   Headings. The descriptive headings of the several paragraphs of this
Agreement are inserted for convenience of reference only and shall not
constitute a part of this Agreement.

 

(f)   Entire Agreement. This Agreement contains the entire agreement of the
parties concerning the Executive’s employment and all promises, representations,
understandings, arrangements and prior agreements on such subject are merged
herein and superseded hereby.

 

(g)   Representation by Counsel. Each of the parties hereto acknowledges that:
(i) it or he has read this Agreement in its entirety and understands all of its
terms and conditions; (ii) it or he has had the opportunity to consult with any
individuals of its or his choice regarding its or his agreement to the
provisions contained herein, including legal counsel of its or his choice, and
any decision not to was its or his alone; and (iii) it or he is entering into
this Agreement of its or his own free will, without coercion from any source.

 

(h)   Survival. The provisions of Sections 4 through 8, and this Section 13
shall survive termination of this Agreement.

 

(i)    Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, and all of which together shall
constitute one and the same Agreement. Delivery of facsimile or .pdf, or other
electronic copies (complying with the U.S. federal ESIGN Act of 2000 (e.g.,
www.docusign.com)) of signature pages for this Agreement shall be valid and
treated for all purposes as delivery of the originals.

 

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
duly authorized officer and the Executive has set his hand, all as of the day
and year first above written.

  iBio, Inc.                     By:  /s/ Thomas Isett     Thomas Isett, Chief
Executive Officer             Executive                     /s/ Randy J. Maddux
    Randy J. Maddux  

 

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