Exhibit
10.22


 


EXECUTIVE
Employment Agreement


 


This Executive
Employment Agreement dated as of February 22, 2016 (“Agreement”) is by and between Kogan
K. Bao, Ph.D. (“Executive”) and Oncobiologics, Inc.
(“Company”).


 


Whereas,
Executive has been employed by the Company pursuant to a letter agreement with the Company dated November 25, 2015 (the “Prior
Agreement”), and the Company desires to continue the employment of Executive as its Vice President – Analytical
Sciences and provide Executive with certain compensation and benefits in return for Executive’s services, and Executive agrees
to be retained by the Company in such capacity and to receive the compensation and benefits on the terms and conditions set forth
herein; and


 


Whereas,
the Company and Executive desire to enter into this Employment Agreement (the “Agreement”) to become
effective and replace and supersede the Prior Agreement, subject to Executive’s signature below, upon the date of the underwriting
agreement between the Company and the underwriter(s) managing the initial public offering of the Company’s common stock,
pursuant to which such common stock is priced for the initial public offering (the “Effective Date”)
in order to memorialize the terms and conditions of Executive’s employment by the Company upon and following the Effective
Date.


 


Now,
Therefore, in consideration of the mutual promises and covenants contained herein, the parties agree to the following:


 


1.      
    Employment by the Company.


 


1.1           Position.
Subject to the terms set forth herein, the Company agrees to continue to employ Executive in the position of Vice President –
Analytical Sciences, and Executive hereby accepts such continued employment on the terms and conditions set forth in this Agreement.


 


1.2           Duties.
As Vice President – Analytical Sciences, Executive will report to the Chief Executive Officer (“CEO”)
and/or such executive designated by the CEO, performing such duties as are normally associated with his position and such duties
as are assigned to him from time to time, subject to the oversight and direction of the CEO or his designee. During the term of
Executive’s employment with the Company, Executive will work on a full-time basis for the Company and will devote Executive’s
best efforts and substantially all of Executive’s business time and attention to the business of the Company. Executive shall
perform Executive’s duties under this Agreement principally out of the Company’s facility in Cranbury, New Jersey.
In addition, Executive shall make such business trips to such places as may be necessary or advisable for the efficient operations
of the Company.


 


1.3           Company
Policies and Benefits. 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.
Executive will be eligible to participate on the same basis as similarly situated employees in the Company’s benefit plans
in effect from time to time during his employment. All matters of


 




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eligibility for coverage
or benefits under any benefit plan shall be determined in accordance with the provisions of such plan. The Company reserves the
right to change, alter, or terminate any benefit plan in its 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.


 


1.4           Vacation.
While this Agreement is in effect, Executive shall also receive three (3) weeks of vacation per full calendar year (prorated for
any partial calendar year of employment) subject to the Company’s vacation policies and procedures as in effect or amended
from time to time, which vacation time shall accrue pro-rata on a pay period basis. Executive may not carryover any earned but
unused vacation time from any calendar year to any subsequent calendar year unless otherwise expressly required by applicable law
or permitted by applicable Company policies.


 


2.    
      Compensation.


 


2.1           Salary.
Executive shall receive for Executive’s services to be rendered under this Agreement an initial base salary of $230,000 on
an annualized basis, subject to review and adjustment by the Company in its sole discretion, payable subject to standard federal
and state payroll withholding requirements in accordance with the Company’s standard payroll practices (“Base
Salary”).


 


2.2           Annual
Bonus. While this Agreement is in effect, Executive shall be eligible for a discretionary annual cash bonus of a target amount
equal to 35% of Base Salary (“Target Amount”), subject to review and adjustment by the Company in its
sole discretion, payable subject to standard federal and state payroll withholding requirements. Whether or not Executive earns
any bonus will be dependent upon (a) Executive’s continuous performance of services to the Company through the date any bonus
is paid; and (b) the actual achievement by Executive and the Company of the applicable performance targets and goals set by the
Board of Directors of the Company (the “Board”) or its Compensation Committee. The annual period over
which performance is measured for purposes of this bonus is January 1 through December 31. The Board or its Compensation Committee
will determine in its sole discretion the extent to which Executive and the Company have achieved the performance goals upon which
the bonus is based and the amount of the bonus, which could be below the Target Amount (and may be zero). The bonus, if awarded,
will be paid no later than March 15 of the calendar year immediately following the calendar year for which the bonus is being measured.


 


2.3           Equity.
Subject to approval by the Board, Executive is eligible for the grant of 75,000 restricted stock units (the “RSUs”).
The RSUs will be governed by the Company’s relevant equity plan(s) and form award agreement(s), unless specifically stated
otherwise in this Agreement.


 


2.4           Expense
Reimbursement. The Company will reimburse Executive for reasonable business expenses in accordance with the Company’s
standard expense reimbursement policy, as the same may be modified by the Company from time to time. The Company shall reimburse
Executive for all customary and appropriate business-related expenses actually incurred and documented in accordance with Company
policy, as in effect from time to


 




    	 	2.	 



     


    

  


time. For the avoidance
of doubt, to the extent that any reimbursements payable to Executive are subject to the provisions of Section 409A of the Code:
(a) any such reimbursements will be paid no later than December 31 of the year following the year in which the expense was incurred,
(b) the amount of expenses reimbursed in one year will not affect the amount eligible for reimbursement in any subsequent
year, and (c) the right to reimbursement under this Agreement will not be subject to liquidation or exchange for another benefit.


 


2.5          Relocation
Assistance.


 


(a)          Relocation
Expenses. Subject to Executive’s submission of properly documented receipts, the Company will reimburse Executive for
reasonable out-of-pocket expenses incurred by Executive in connection with his relocation from California to a residence near the
Company’s headquarters in Cranbury, New Jersey, in an aggregate amount up to $50,000 (less required withholding and/or deductions
required by the applicable law, if any) (the “Relocation Expense Reimbursements”). The expenses that
will qualify for reimbursement by the Company include the following: (a) the reasonable costs associated with moving Executive’s
personal and household goods to the Cranbury, New Jersey area, including shipment of automobiles, furniture, personal effects,
and the like; (b) one-way coach airfare for one trip of Executive and his family from California to the Cranbury, New Jersey
area (c) customary closing costs incurred by Executive in connection with the sale of his current residence in California
and (d) customary closing costs incurred by Executive in connection with the purchase of a new residence in the Cranbury,
New Jersey area. The Company makes no representations regarding the proper tax treatment of Executive’s reimbursed relocation
costs and Executive is responsible for obtaining independent advice from his own personal tax advisor.


 


(b)          Temporary
Housing Expenses.  Through April 19, 2016, the Company will reimburse Executive for reasonable living quarters in the Cranbury,
New Jersey area, in a maximum gross amount of $3,000 per 30 consecutive day period (less required withholding and/or deductions
required by the applicable law, if any) up to an aggregate amount of $9,000 (“Temporary Housing Expenses”).
Any Temporary Housing Expenses paid by the Company on Executive’s behalf during such period shall be counted towards the
$3,000 per month maximum. Any Temporary Housing Expenses incurred directly by Executive must be submitted for reimbursement in
accordance with and subject to the Company’s business expense reimbursement policies.


 


(c)          Repayment
of Relocation Expense Reimbursements and Temporary Housing Expenses. In the event that, on or prior to January 20, 2018 (the
“Start Date”), either (i) Executive terminates his employment with the Company for any reason other than
for Good Reason, or (ii) the Company terminates the Executive’s employment for Cause (as defined in Section 6.3 below) except
in connection with a Change in Control (as defined in Section 6.2 below), then Executive shall reimburse the Company on such date
of termination for a portion of the Relocation Expense Reimbursements and Temporary Housing Expenses paid by the Company to the
Executive in an amount determined based upon the days between the Start Date and the date of termination of employment according
to the following schedule:


 




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	Days Since Start Date	 	% of Relocation Expense

    Reimbursements and Temporary
 Housing Expenses to be
 Reimbursed to the Company	 
	 	 	 	 
	0 to 365 days	 	 	100	%
	 	 	 	 	 
	366 to 450 days	 	 	75	%
	 	 	 	 	 
	451 to 540 days	 	 	50	%
	 	 	 	 	 
	541 to 730 days	 	 	25	%
	 	 	 	 	 
	Over 730 days	 	 	0	%



 


(d)          For
the avoidance of doubt, to the extent that any reimbursements payable to Executive pursuant to this Section 2.5 are subject to
the provisions of Section 409A of the Code: (i) any such reimbursements will be paid no later than December 31 of the year
following the year in which the expense was incurred, (ii) the amount of expenses reimbursed in one year will not affect the
amount eligible for reimbursement in any subsequent year, and (iii) the right to reimbursement under this Agreement will not
be subject to liquidation or exchange for another benefit.


 


3.          Proprietary
Information, Inventions, Non-Competition and Non-Solicitation Obligations.
As a condition of continued employment, Executive agrees to execute and abide by an Employee Proprietary Information, Inventions,
Non-Competition and Non-Solicitation Agreement attached as Exhibit A (“Proprietary Information Agreement”),
which may be amended by the parties from time to time without regard to this Agreement. The Proprietary Information Agreement contains
provisions that are intended by the parties to survive and do survive termination of this Agreement.


 


4.          Outside
Activities during Employment. Except with the prior written consent of the Board, including consent given to Executive prior
to the signing of this Agreement, Executive will not, while employed by the Company, undertake or engage in any other employment,
occupation or business enterprise that would interfere with Executive’s responsibilities and the performance of Executive’s
duties hereunder except for (i) reasonable time devoted to volunteer services for or on behalf of such religious, educational,
non-profit and/or other charitable organization as Executive may wish to serve, (ii) reasonable time devoted to activities
in the non-profit and business communities consistent with Executive’s duties; and (iii) such other activities as may
be specifically approved by the Board. This restriction shall not, however, preclude Executive (x) from owning less than one
percent (1%) of the total outstanding shares of a publicly traded company, or (y) from employment or service in any capacity
with Affiliates of the Company. As used in this Agreement, “Affiliates” means an entity under common
management or control with the Company.


 




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5.          No
Conflict with Existing Obligations. Executive represents that Executive’s performance of all the terms of this Agreement
does not and will not breach any agreement or obligation of any kind made prior to Executive’s employment by the Company,
including agreements or obligations Executive may have with prior employers or entities for which Executive has provided services.
Executive has not entered into, and Executive agrees that Executive will not enter into, any agreement or obligation, either written
or oral, in conflict herewith.


 


6.          Termination
of Employment. The parties acknowledge that Executive’s employment relationship with the Company is at-will, meaning
either the Company or Executive may terminate Executive’s employment at any time, with or without cause or advance notice.
The provisions in this Section govern the amount of compensation, if any, to be provided to Executive upon termination of employment
and do not alter this at-will status.


 


6.1          Termination
by the Company without Cause or for Good Reason.


 


(a)          The
Company shall have the right to terminate Executive’s employment with the Company pursuant to this Section 6.1 at
any time, in accordance with Section 6.6, without “Cause” (as defined in Section 6.3(b) below) by giving
notice as described in Section 7.1 of this Agreement. A termination pursuant to Section 6.5 below is not a termination
without “Cause” for purposes of receiving the benefits described in Sections 6.1 or Section 6.2.


 


(b)          If
the Company terminates Executive’s employment at any time without Cause or Executive terminates his employment with the Company
for Good Reason and provided that such termination constitutes a “separation from service” (as defined under Treasury
Regulation Section 1.409A-1(h), without regard to any alternative definition thereunder, a “Separation from Service”),
then Executive shall be entitled to receive the Accrued Obligations (defined below). If Executive complies with the obligations
in Section 6.1(c) below, Executive shall also be eligible to receive the following “Severance Benefits”:


 


(i)          The
Company will pay Executive an amount equal to Executive’s then current Base Salary for six (6) months, less all applicable
withholdings and deductions, paid in equal installments on the Company’s normal payroll schedule following the termination
date, with the first payment beginning on the Severance Pay Commencement Date (as defined in Section 6.1(c) below), and
the remaining installments occurring on the Company’s regularly scheduled payroll dates thereafter; provided that on the
Severance Pay Commencement Date, the Company will pay in a lump sum the aggregate amount of the cash severance payments that the
Company would have paid Executive through such date had the payments commenced on the effective date of termination through the
Severance Pay Commencement Date.


 


(ii)         If
Executive timely elects continued coverage under COBRA for himself and his covered dependents under the Company’s group health
plans following such termination, then the Company shall pay the COBRA premiums necessary to continue Executive’s and his
covered dependents’ health insurance coverage in effect for himself (and his covered dependents) on the termination date
until the earliest of: (i) six (6) months following the termination date (the “COBRA Severance Period”);
(ii) the date when Executive


 




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becomes eligible for
substantially equivalent health insurance coverage in connection with new employment or self-employment; or (iii) the date
Executive ceases to be eligible for COBRA continuation coverage for any reason, including plan termination (such period from the
termination date through the earlier of (i)-(iii), (the “COBRA Payment Period”). Notwithstanding the
foregoing, if at any time the Company determines that its payment of COBRA premiums on Executive’s behalf would result in
a violation of applicable law (including, but not limited to, the 2010 Patient Protection and Affordable Care Act, as amended by
the 2010 Health Care and Education Reconciliation Act), then in lieu of paying COBRA premiums pursuant to this Section, the Company
shall pay Executive on the last day of each remaining month of the COBRA Payment Period, a fully taxable cash payment equal to
the COBRA premium for such month, subject to applicable tax withholding (such amount, the “Special Severance Payment”),
for the remainder of the COBRA Payment Period. Nothing in this Agreement shall deprive Executive of his rights under COBRA or ERISA
for benefits under plans and policies arising under his employment by the Company.


 


(iii)        Notwithstanding
the terms of any equity plan or award agreement to the contrary, the time-based vesting conditions applicable to fifty percent
(50%) of Executive’s stock options and/or other equity awards subject to time-based vesting requirements that are outstanding
and not vested as of Executive’s termination date shall accelerate and deemed to be satisfied as of the date of Executive’s
termination. For the avoidance of doubt, the accelerated vesting provided under this Section 6.1(b)(iv) shall not apply to any
liquidity event or performance-based vesting conditions applicable to any of Executive’s outstanding stock options or other
equity awards as of the date of termination.


 


(c)          Executive
will be paid all of the Accrued Obligations on the Company’s first payroll date after Executive’s date of termination
from employment or earlier if required by law. Executive shall receive the Severance Benefits pursuant to Section 6.1(b) or
the Change in Control Severance Benefits (defined below) pursuant to 6.2(a) of this Agreement, as applicable, if: (i) Executive
executes and does not revoke a separation agreement containing an effective, general release of claims in favor of the Company
and its affiliates and representatives, in a form acceptable to the Company (the “Release”) and the Release
is enforceable and effective as provided in the Release on or before the date that is the sixtieth (60th) day following
the effective date of termination (such 60th day, the “Severance Pay Commencement Date”);
(ii) he holds any other positions with the Company, he resigns such position(s) to be effective no later than the date of
Executive’s termination date (or such other date as requested by the Board); (iii) he returns all Company property;
(iv) he complies with his post-termination obligations under this Agreement and the Proprietary Information Agreement; and
(v) he complies with the terms of the Release, including without limitation any non-disparagement and confidentiality provisions
contained in Release.


 


(d)          For
purposes of this Agreement, “Accrued Obligations” are (i) Executive’s accrued but unpaid salary
through the date of termination, (ii) any unreimbursed business expenses incurred by Executive payable in accordance with the Company’s
standard expense reimbursement policies, and (iii) benefits owed to Executive under any qualified retirement plan or health and
welfare benefit plan in which Executive was a participant in accordance with applicable law and the provisions of such plan.


 




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(e)          The
Severance Benefits provided to Executive pursuant to this Section 6.1 are in lieu of, and not in addition to, any benefits
to which Executive may otherwise be entitled under any Company severance plan, policy or program.


 


(f)          Any
damages caused by the termination of Executive’s employment without Cause would be difficult to ascertain; therefore, the
Severance Benefits for which Executive is eligible pursuant to Section 6.1(b) above in exchange for the Release is agreed
to by the parties as liquidated damages, to serve as full compensation, and not a penalty.


 


(g)          For
purposes of this Agreement, “Good Reason” shall mean the occurrence of any of the following events without
Executive’s consent: (i) a material reduction in Executive’s Base Salary of at least 25%; (ii) a material
breach of this Agreement by the Company; (iii) a material reduction in the Executive’s duties, authority and responsibilities
relative to the Executive’s duties, authority, and responsibilities in effect immediately prior to such reduction; or (iv) the
relocation of Executive’s principal place of employment, without Executive’s consent, in a manner that lengthens his
one-way commute distance by fifty (50) or more miles from his then-current principal place of employment immediately prior to such
relocation; provided, however, that, any such termination by Executive shall only be deemed for Good Reason pursuant to
this definition if: (1) Executive gives the Company written notice of his intent to terminate for Good Reason within thirty
(30) days following the first occurrence of the condition(s) that he believes constitute(s) Good Reason, which notice shall describe
such condition(s); (2) the Company fails to remedy such condition(s) within thirty (30) days following receipt of the written
notice (the “Cure Period”); and (3) Executive voluntarily terminates his employment within thirty
(30) days following the end of the Cure Period.


 


6.2          Termination
by the Company without Cause or for Good Reason Coincident with a Change in Control.


 


(a)          If
Executive’s employment by the Company is terminated by the Company or any successor entity without “Cause” (and
not due to Disability or death) or by Executive for Good Reason within two (2) months prior to or within twelve (12) months following
the effective date of a “Change in Control” (as defined in the Company’s 2015 Equity Incentive
Plan, as such plan may be amended from time to time), provided that such termination constitutes a Separation from Service, without
regard to any alternative definition thereunder, then in addition to paying or providing Executive with the Accrued Obligations
and subject to compliance with Section 6.1(c), the Company will provide the following “Change in Control Severance
Benefits”:


 


(i)          The
Company will pay Executive an amount equal to Executive’s then current Base Salary for six (6) months, less all applicable
withholdings and deductions, paid in equal installments on the Company’s normal payroll schedule following the date of Separation
from Service, with the first payment beginning on the Severance Pay Commencement Date, and the remaining installments occurring
on the Company’s regularly scheduled payroll dates thereafter; provided that on the Severance Pay Commencement Date, the
Company will pay in a lump sum the aggregate amount of the cash severance payments that the Company would have paid Executive through
such date had the payments commenced on the effective date of termination through the Severance Pay Commencement Date.


 




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(ii)         The
Company will pay a bonus amount equal to Executive’s Target Amount for the performance year in which Executive’s termination
occurs, divided by twelve (12), and then multiplied by six (6). This bonus will be payable subject to standard federal and state
payroll withholding requirements in a lump sum payment on the Severance Pay Commencement Date.


 


(iii)        If
Executive timely elects continued coverage under COBRA for himself and his covered dependents under the Company’s group health
plans following such termination, then the Company shall pay the COBRA premiums necessary to continue Executive’s and his
covered dependents’ health insurance coverage in effect for himself (and his covered dependents) on the termination date
until the earliest of: (i) six (6) months following the termination date (the “COBRA Severance Period”);
(ii) the date when Executive becomes eligible for substantially equivalent health insurance coverage in connection with new
employment or self-employment; or (iii) the date Executive ceases to be eligible for COBRA continuation coverage for any reason,
including plan termination (such period from the termination date through the earlier of (i)-(iii), (the “COBRA Payment
Period”). Notwithstanding the foregoing, if at any time the Company determines that its payment of COBRA premiums
on Executive’s behalf would result in a violation of applicable law (including, but not limited to, the 2010 Patient Protection
and Affordable Care Act, as amended by the 2010 Health Care and Education Reconciliation Act), then in lieu of paying COBRA premiums
pursuant to this Section, the Company shall pay Executive on the last day of each remaining month of the COBRA Payment Period,
a fully taxable cash payment equal to the COBRA premium for such month, subject to applicable tax withholding (such amount, the
“Special Severance Payment”), for the remainder of the COBRA Payment Period. Nothing in this Agreement
shall deprive Executive of his rights under COBRA or ERISA for benefits under plans and policies arising under his employment by
the Company.


 


(iv)        Notwithstanding
the terms of any equity plan or award agreement to the contrary, the time-based vesting conditions applicable to all of Executive’s
outstanding stock options and/or other equity awards subject to time-based vesting requirements as of Executive’s termination
date shall vest as follows: (A) if such termination occurs within two (2) months prior to or on the effective date of a Change
in Control, the time-based vesting restrictions shall accelerate and be deemed to be satisfied as of the date of Executive’s
termination, and (B) if such termination occurs within twelve (12) months following the effective date of a Change in Control,
in the event any surviving corporation or acquiring corporation assumes Executive’s stock options and/or other equity awards,
as applicable, or substitutes similar stock options or equity awards for Executive’s stock options and/or equity awards,
as applicable, in accordance with the terms of the Company’s equity incentive plans, the time-based vesting of all of such
stock options and/or equity awards (or any substitute stock options or equity awards), as applicable, shall be accelerated in full
as of the date of termination. For the avoidance of doubt, the accelerated vesting provided under this Section 6.2(a)(iv) shall
not apply to any liquidity event or performance-based vesting conditions applicable to any of Executive’s outstanding stock
options and/or other equity awards as of the date of termination.


 


(b)          The
Change in Control Severance Benefits provided to Executive pursuant to this Section 6.2 are in lieu of, and not in addition
to, any benefits to which Executive may otherwise be entitled under any Company severance plan, policy or program, including but


 




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not limited to the Severance
Benefits described in Section 6.1(b). For the avoidance of doubt, in no event shall Executive be entitled to benefits under
both Section 6.1(b) and this Section 6.2. If Executive is eligible for benefits under both Section 6.1(b) and this Section 6.2,
or if Executive begins receiving benefits under Section 6.1(b) and later becomes eligible for benefits under Section 6.2, Executive
shall receive the benefits set forth in this Section 6.2 and such benefits will be reduced by any benefits previously provided
to Executive under Section 6.1(b).


 


(c)          Any
damages caused by the termination of Executive’s employment without Cause or for Good Reason following a Change in Control
would be difficult to ascertain; therefore, the Change in Control Severance Benefits for which Executive is eligible pursuant to
Section 6.2(a) above in exchange for the Release is agreed to by the parties as liquidated damages, to serve as full compensation,
and not a penalty.


 


6.3          Termination
by the Company for Cause.


 


(a)          The
Company shall have the right to terminate Executive's employment with the Company at any time, in accordance with Section 6.6,
for Cause by giving notice as described in Section 7.1 of this Agreement. In the event Executive's employment is terminated
at any time for Cause, Executive will not receive Severance Benefits, Change in Control Severance Benefits, or any other severance
compensation or benefits, except that, pursuant to the Company's standard payroll policies, the Company shall pay to Executive
the Accrued Obligations.


 


(b)          "Cause"
for termination shall mean that the Company has determined in its sole discretion that Executive has engaged in any of the following:
(i) a material breach of any covenant or condition under this Agreement or any other agreement between the parties; (ii) any
act constituting dishonesty, fraud, immoral or disreputable conduct; (iii) any conduct which constitutes a felony under applicable
law; (iv) material violation of any Company policy or any act of misconduct; (v) refusal to follow or implement a clear
and reasonable directive of Company; (vi) negligence or incompetence in the performance of Executive’s duties or failure
to perform such duties in a manner satisfactory to the Company after the expiration of ten (10) days without cure after written
notice of such failure; or (vii) breach of fiduciary duty.


 


6.4          Resignation
by Executive.


 


(a)          Executive
may resign from Executive’s employment with the Company at any time, in accordance with Section 6.6, by giving notice
as described in Section 7.1.


 


(b)          In
the event Executive resigns from Executive’s employment with the Company for any reason other than Good Reason in accordance
with Sections 6.1 or 6.2, Executive will not receive Severance Benefits, Change in Control Severance Benefits, or any other
severance compensation or benefits, except that, pursuant to the Company’s standard payroll policies, the Company shall pay
to Executive the Accrued Obligations.


 




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6.5          Termination
by Virtue of Death or Disability of Executive.


 


(a)          In
the event of Executive’s death while employed pursuant to this Agreement, all obligations of the parties hereunder shall
terminate immediately, in accordance with Section 6.6, and the Company shall, pursuant to the Company’s standard payroll
policies, pay to Executive’s legal representatives all Accrued Obligations.


 


(b)          Subject
to applicable state and federal law, the Company shall at all times have the right, upon written notice to Executive, and in accordance
with Section 6.6, to terminate this Agreement based on Executive’s Disability. Termination by the Company of Executive’s
employment based on “Disability” shall mean termination because Executive is unable due to a physical
or mental condition to perform the essential functions of his position with or without reasonable accommodation for 180 days in
the aggregate during any twelve (12) month period or based on the written certification by two licensed physicians of the likely
continuation of such condition for such period. This definition shall be interpreted and applied consistent with the Americans
with Disabilities Act, the Family and Medical Leave Act, and other applicable law. In the event Executive’s employment is
terminated based on Executive’s Disability, Executive will not receive Severance Benefits, Change in Control Severance Benefits,
or any other severance compensation or benefit, except that, pursuant to the Company’s standard payroll policies, the Company
shall pay to Executive the Accrued Obligations.


 


6.6          Notice;
Effective Date of Termination.


 


(a)          Termination
of Executive’s employment pursuant to this Agreement shall be effective on the earliest of:


 


(i)          immediately
after the Company gives notice to Executive of Executive’s termination, with or without Cause, unless pursuant to Section
6.3(b)(vi) in which case ten (10) days after notice if not cured or unless the Company specifies a later date, in which case, termination
shall be effective as of such later date;


 


(ii)         immediately
upon the Executive’s death;


 


(iii)        ten
(10) days after the Company gives notice to Executive of Executive’s termination on account of Executive’s Disability,
unless the Company specifies a later date, in which case, termination shall be effective as of such later date, provided
that Executive has not returned to the full time performance of Executive’s duties prior to such date;


 


(iv)        ten
(10) days after the Executive gives written notice to the Company of Executive’s resignation, provided that the Company
may set a termination date at any time between the date of notice and the date of resignation, in which case the Executive’s
resignation shall be effective as of such other date. Executive will receive compensation through any required notice period; or


 


(v)         for
a termination for Good Reason, immediately upon Executive’s full satisfaction of the requirements of Section 6.1(g).


 




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(b)          In
the event notice of a termination under subsections (a)(i) or (iii) is given orally, at the other party’s request, the party
giving notice must provide written confirmation of such notice within five (5) business days of the request in compliance with
the requirement of Section 7.1 below. In the event of a termination for Cause, written confirmation shall specify the subsection(s)
of the definition of Cause relied on to support the decision to terminate.


 


6.7          Cooperation
with Company after Termination of Employment. Following termination of Executive’s employment for any reason, Executive
agrees to cooperate fully with the Company in connection with its actual or contemplated defense, prosecution, or investigation
of any claims or demands by or against third parties, or other matters arising from events, acts, or failures to act that occurred
during the period of Executive’s employment by the Company. Such cooperation includes, without limitation, making Executive
available to the Company upon reasonable notice, without subpoena, to provide complete, truthful and accurate information in witness
interviews, depositions and trial testimony. In addition, for six (6) months after Executive’s employment with the Company
ends for any reason, Executive agrees to cooperate fully with the Company in all matters relating to the transition of Executive’s
work and responsibilities on behalf of the Company, including, but not limited to, any present, prior or subsequent relationships
and the orderly transfer of any such work and institutional knowledge to such other persons as may be designated by the Company.
The Company will reimburse Executive for reasonable out-of-pocket expenses Executive incurs in connection with any such cooperation
(excluding forgone wages, salary, or other compensation) and will make reasonable efforts to accommodate Executive’s scheduling
needs.


 


6.8          Application
of Section 409A. It is intended that all of the severance payments payable under this Agreement satisfy, to the greatest extent
possible, the exemptions from the application of Section 409A of the Code and the regulations and other guidance thereunder and
any state law of similar effect (collectively, “Section 409A”) provided under Treasury Regulations Sections
1.409A-1(b)(4) and 1.409A-1(b)(9), and this Agreement will be construed in a manner that complies with Section 409A. If not so
exempt, this Agreement (and any definitions hereunder) will be construed in a manner that complies with Section 409A, and incorporates
by reference all required definitions and payment terms. No severance payments will be made under this Agreement unless Executive’s
termination of employment constitutes a “separation from service” (as defined under Treasury Regulation Section 1.409A-1(h)).
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 any installment payments under this Agreement (whether severance payments or otherwise) shall
be treated as a right to receive a series of separate payments and, accordingly, each installment payment hereunder shall at all
times be considered a separate and distinct payment. If the Company determines that the severance benefits provided under this
Agreement constitutes “deferred compensation” under Section 409A and if Executive is a “specified employee”
of the Company, as such term is defined in Section 409A(a)(2)(B)(i) of the Code at the time of Executive’s Separation from
Service, then, solely to the extent necessary to avoid the incurrence of the adverse personal tax consequences under Section 409A,
the timing of the Severance will be delayed as follows: on the earlier to occur of (a) the date that is six months and one
day after Executive’s Separation from Service, and (b) the date of Executive’s death (such earlier date, the “Delayed
Initial Payment Date”), the Company will (i) pay to Executive a lump sum amount equal to the sum of


 




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the severance benefits
that Executive would otherwise have received through the Delayed Initial Payment Date if the commencement of the payment of the
severance benefits had not been delayed pursuant to this Section 6.8 and (ii) commence paying the balance of the severance
benefits in accordance with the applicable payment schedule set forth in Section 6. No interest shall be due on any amounts deferred
pursuant to this Section 6.8. To the extent that any Severance Benefits are deferred compensation under Section 409A of the Code,
and are not otherwise exempt from the application of Section 409A, then, if the period during which Executive may consider and
sign the Release spans two calendar years, the payment of any such Severance Benefit will not be made or begin until the later
calendar year.


 


6.9          Section
280G. Notwithstanding any other provision of this Agreement to the contrary, if payments made or benefits provided pursuant
to this Agreement or otherwise from the Company or any person or entity are considered “parachute payments” under Section
280G of the Code, then such parachute payments will be limited to the greatest amount that may be paid to Executive under Section
280G of the Code without causing any loss of deduction to the Company Group under such section, but only if, by reason of such
reduction, the net after tax benefit to Executive will exceed the net after tax benefit if such reduction were not made. “Net
after tax benefit” for purposes of this Agreement will mean the sum of (i) the total amounts payable to the
Executive under this Agreement, plus (ii) all other payments and benefits which the Executive receives or then is entitled
to receive from the Company or otherwise that would constitute a “parachute payment” within the meaning of Section
280G of the Code, less (iii) the amount of federal and state income taxes payable with respect to the foregoing calculated
at the maximum marginal income tax rate for each year in which the foregoing will be paid to Executive (based upon the rate in
effect for such year as set forth in the Code at the time of termination of Executive’s employment), less (iv) the amount
of excise taxes imposed with respect to the payments and benefits described in (i) and (ii) above by Section 4999 of the Code.
The determination as to whether and to what extent payments are required to be reduced in accordance with this Section 6.9 will
be made at the Company’s expense by a nationally recognized certified public accounting firm as may be designated by the
Company prior to a change in control (the “Accounting Firm”). In the event of any mistaken underpayment
or overpayment under this Agreement, as determined by the Accounting Firm, the amount of such underpayment or overpayment will
forthwith be paid to Executive or refunded to the Company, as the case may be, with interest at one hundred twenty (120%) of the
applicable Federal rate provided for in Section 7872(f)(2) of the Code. Any reduction in payments required by this Section 6.9
will occur in the following order: (1) any cash severance, (2) any other cash amount payable to Executive, (3) any
benefit valued as a “parachute payment,” (4) the acceleration of vesting of any equity awards that are options,
and (5) the acceleration of vesting of any other equity awards. Within any such category of payments and benefits, a reduction
will occur first with respect to amounts that are not “deferred compensation” within the meaning of Section 409A and
then with respect to amounts that are. In the event that acceleration of compensation from equity awards is to be reduced, such
acceleration of vesting will be canceled, subject to the immediately preceding sentence, in the reverse order of the date of grant.


 


7.    
      General Provisions.


 


7.1           Notices.
Any notices required hereunder to be in writing shall be deemed effectively given: (a) upon personal delivery to the party
to be notified, (b) when sent by


 




    	 	12.	 



     


    

  


electronic mail or confirmed
facsimile if sent during normal business hours of the recipient, and if not, then on the next business day, (c) five (5) days
after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) day after
deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All
communications shall be sent to the Company at its primary office location and to Executive at either Executive’s address
as listed on the Company payroll, or Executive’s Company-issued email address, or at such other address as the Company or
Executive may designate by ten (10) days advance written notice to the other.


 


7.2           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 or any other
jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable
provisions had never been contained herein.


 


7.3           Survival.
Provisions of this Agreement which by their terms must survive the termination of this Agreement in order to effectuate the intent
of the parties will survive any such termination for such period as may be appropriate under the circumstances.


 


7.4           Waiver.
If either party should waive any breach of any provisions of this Agreement, it shall not thereby be deemed to have waived any
preceding or succeeding breach of the same or any other provision of this Agreement.


 


7.5           Complete
Agreement. This Agreement constitutes the entire agreement between Executive and the Company with regard to the subject matter
hereof. This Agreement is the complete, final, and exclusive embodiment of their agreement with regard to this subject matter and
supersedes any prior oral discussions or written communications and agreements, including the Prior Agreement and any other draft
offer letters. This Agreement is entered into without reliance on any promise or representation other than those expressly contained
herein, and it cannot be modified or amended except in writing signed by Executive and an authorized officer of the Company. The
parties have entered into a separate Proprietary Information Agreement and have or may enter into separate agreements related to
equity. These separate agreements govern other aspects of the relationship between the parties, have or may have provisions that
survive termination of Executive’s employment under this Agreement, may be amended or superseded by the parties without regard
to this Agreement and are enforceable according to their terms without regard to the enforcement provision of this Agreement.


 


7.6           Counterparts.
This Agreement may be executed in separate counterparts, any one of which need not contain signatures of more than one party, but
all of which taken together will constitute one and the same Agreement. The parties agree that facsimile and scanned image copies
of signatures will suffice as original signatures.


 


7.7           Withholding
Taxes. The Company will be entitled to withhold from any payment due to Executive hereunder any amounts required to be withheld
by applicable tax laws or regulations.


 




    	 	13.	 



     


    

  


7.8           Headings.
The headings of the sections hereof are inserted for convenience only and shall not be deemed to constitute a part hereof nor to
affect the meaning thereof.


 


7.9           Successors
and Assigns. The Company shall assign this Agreement and its rights and obligations hereunder in whole, but not in part, to
any Company or other entity with or into which the Company may hereafter merge or consolidate or to which the Company may transfer
all or substantially all of its assets, if in any such case said Company or other entity shall by operation of law or expressly
in writing assume all obligations of the Company hereunder as fully as if it had been originally made a party hereto, but may not
otherwise assign this Agreement or its rights and obligations hereunder. Executive may not assign or transfer this Agreement or
any rights or obligations hereunder, other than to his estate upon his death.


 


7.10         Choice
of Law. All questions concerning the construction, validity and interpretation of this Agreement will be governed by the laws
of the State of New Jersey.


 


7.11         Dispute
Resolution. The parties recognize that litigation in federal or state courts or before federal or state administrative agencies
of disputes arising out of the Executive’s employment with the Company or out of this Agreement, or the Executive’s
termination of employment or termination of this Agreement, may not be in the best interests of either the Executive or the Company,
and may result in unnecessary costs, delays, complexities, and uncertainty. The parties agree that any dispute between the parties
arising out of or relating to the negotiation, execution, performance or termination of this Agreement or the Executive’s
employment, including, but not limited to, any claim arising out of this Agreement, claims under Title VII of the Civil Rights
Act of 1964, as amended, the Civil Rights Act of 1991, the Age Discrimination in Employment Act of 1967, the Americans with Disabilities
Act of 1990, Section 1981 of the Civil Rights Act of 1966, as amended, the Family Medical Leave Act, the Executive Retirement Income
Security Act, and any similar federal, state or local law, statute, regulation, or any common law doctrine, whether that dispute
arises during or after employment, shall be settled by binding arbitration in accordance with the National Rules for the Resolution
of Employment Disputes of the American Arbitration Association; provided however, that this dispute resolution provision
shall not apply to any separate agreements between the parties that do not themselves specify arbitration as an exclusive remedy.
The location for the arbitration shall be the Princeton/Trenton, New Jersey area. Any award made by such panel shall be final,
binding and conclusive on the parties for all purposes, and judgment upon the award rendered by the arbitrators may be entered
in any court having jurisdiction thereof. The arbitrators’ fees and expenses and all administrative fees and expenses associated
with the filing of the arbitration shall be borne by the Company; provided however, that at the Executive’s option,
Executive may voluntarily pay up to one-half the costs and fees. The parties acknowledge and agree that their obligations to arbitrate
under this Section survive the termination of this Agreement and continue after the termination of the employment relationship
between Executive and the Company. The parties each further agree that the arbitration provisions of this Agreement shall provide
each party with its exclusive remedy, and each party expressly waives any right it might have to seek redress in any other
forum, except as otherwise expressly provided in this Agreement. By election arbitration as the means for final settlement of all
claims, the parties hereby waive their respective rights to, and agree not to, sue each other in any action in a Federal, State
or local court with respect to such claims, but may seek to enforce in court an arbitration 


 




    	 	14.	 



     


    

 


award rendered pursuant
to this Agreement. The parties specifically agree to 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.


 


[signatures
to follow on next page]


 




    	 	15.	 



     


    

 


In
Witness Whereof, the parties have duly executed this Agreement as of the date first above written.


 


	 	Oncobiologics, Inc.
	 	 	 
	 	By:	/s/ Pankaj Mohan
	 	 	Name: Pankaj Mohan, Ph.D.
	 	 	Title: President and Chief Executive Officer
	 	 	 
	 	Executive
	 	 
	 	/s/ Kogan K. Bao
	 	Name: Kogan K. Bao, Ph.D.