Document:

Exhibit 10.2

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

 

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) is entered into effective as of September 26, 2019 (the “Effective Date”), by and between Lee Kalowski (“Executive”) and Bicycle Therapeutics Inc. (the “Company”).

 

Executive has been employed by the Company as its President and Chief Financial Officer pursuant to the Employment Agreement with the Company dated July 24, 2017, which was then amended and restated May 28, 2019 (the “Prior Agreement”).

 

The Company desires to continue to employ Executive and, in connection therewith, to compensate Executive for Executive’s personal services to the Company; and

 

Executive wishes to continue to be employed by the Company and provide personal services to the Company in return for certain compensation.

 

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

 

1.                                      EMPLOYMENT BY THE COMPANY.

 

1.1                               At-Will Employment.  Executive shall continue to be employed by the Company on an “at-will” basis, meaning either the Company or Executive may terminate Executive’s employment at any time, with or without Cause (as defined in Section 6.2(f) below), Good Reason (as defined in Section 6.2(e) below), or advance notice.  Any contrary representations that may have been made to Executive shall be superseded by this Agreement.  This Agreement shall constitute the full and complete agreement between Executive and the Company on the “at-will” nature of Executive’s employment with the Company, which may be changed only in an express written agreement signed by Executive and a duly authorized officer of the Company.  Executive’s rights to any salary or cash bonus following a termination shall be only as set forth in Section 6 or under any applicable benefit or equity plan.

 

1.2                               Position.  Subject to the terms set forth herein, the Company agrees to continue to employ Executive and Executive hereby accepts such continued employment.  In addition, Executive shall continue to serve as President and Chief Financial Officer.  During the term of Executive’s employment with the Company, and excluding periods of vacation and sick leave to which Executive is entitled, Executive shall devote all business time and attention to the affairs of the Company necessary to discharge the responsibilities assigned hereunder, and shall use commercially reasonable efforts to perform faithfully and efficiently such responsibilities.

 

1.3                               Duties.  Executive will continue to render such business and professional services in the performance of Executive’s duties (consistent with Executive’s position as President and Chief Financial Officer) to the Company, and for the benefit of the Company’s parent, Bicycle Therapeutics plc (“BTL”).  Executive shall continue to report to BTL’s Chief Executive Officer.  For the avoidance of doubt and for ease of understanding the intent of the arrangement, all of Executive’s services described herein shall be provided directly to the Company, which will, in turn, continue to

 

 

provide such services to BTL pursuant to an arm’s length intra-company agreement.  To the extent that Executive engages in any services contemplated herein on BTL’s behalf that involve the execution and negotiation of legal documents, such services will be performed in the United Kingdom.  Executive shall continue to be expected to perform Executive’s duties under this Agreement out of the Company’s office in Lexington, Massachusetts, or such other location as assigned.  In addition, Executive shall make such business trips to such places as may be reasonably necessary or advisable for the efficient operations of the Company.

 

1.4                               Company Policies and Benefits.  The employment relationship between the parties shall continue to be subject to the Company’s written personnel policies and procedures as they may be adopted, revised, or deleted from time to time in the Company’s sole discretion.      Executive will continue to 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 Executive’s employment.  Subject to the preceding sentence, the Company reserves the right to change, alter, or terminate any benefit plan in its sole discretion.  All matters of eligibility for coverage or benefits under any benefit plan shall be determined in accordance with the provisions of such plan.  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.

 

1.5                               Vacation.  During the term of Executive’s employment with the Company, Executive shall continue to accrue five weeks of paid time off per calendar year (prorated for partial years), subject to the Company’s paid time off policy, as in effect from time to time.

 

1.6                               Pension.  During the term of Executive’s employment with the Company, Executive shall continue to be eligible to receive up to four (4) percent of Base Salary as contributions to a safe harbor 401(k) plan.

 

2.                                      COMPENSATION.

 

2.1                               Salary.  Executive shall receive an annualized base salary of $450,000, subject to review and increase (but not decrease) from time to time 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 (the “Base Salary”).

 

2.2                               Bonus.

 

(a)                                 During Employment.  Executive shall be eligible to earn an annual performance bonus (the “Annual Bonus”) with an annual target of 40% (the “Target Percentage”) of Executive’s then-current Base Salary.   The Annual Bonus will be based upon the assessment by the Board of Directors of the Company (the “Board”) or a committee thereof of Executive’s performance and the Company’s attainment of targeted goals (as set by the Company and confirmed by the Board in its reasonable good faith discretion) over the applicable calendar year.  The Annual Bonus, if any, will be subject to applicable payroll deductions and withholdings.  No amount of any Annual Bonus is guaranteed at any time, and, except as otherwise stated in Sections 6.3(a)(iii), Executive must be an employee in good standing through the date the Annual Bonus is paid to be eligible to receive an Annual Bonus, except as set forth in Section 6.1(a).  No partial or prorated bonuses will be provided.  Subject to Section 6.3(b) related to payments upon certain terminations of

 

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employment, any Annual Bonus, if earned, will be paid at the same time annual bonuses are generally paid to other similarly-situated employees of the Company.  Executive’s eligibility for an Annual Bonus is subject to change in the discretion of the Board (or any authorized committee thereof).

 

(b)                                 Upon Termination.  Subject to the provisions of Section 6, in the event Executive leaves the employ of the Company for any reason prior to the date the Annual Bonus is paid, Executive is not eligible to earn such Annual Bonus, prorated or otherwise.

 

(c)                                  Equity Awards.  The equity awards held by the Executive shall continue to be governed by the terms and conditions of the Company’s applicable equity incentive plan(s) and the applicable award agreement(s) governing the terms of such equity awards held by the Executive (collectively, the “Equity Documents”); provided, however, and notwithstanding anything to the contrary in the Equity Documents, Section 6.3(a)(iv) of this Agreement shall apply in the event of a termination by the Company without Cause or by the Executive for Good Reason, in either case within 12 months after a Change in Control (as defined in Exhibit A hereto).

 

2.3                               Expense Reimbursement.  The Company will reimburse Executive for reasonable business expenses in accordance with the Company’s standard expense reimbursement policy, subject to any applicable payroll withholdings and deductions (if any).  For the avoidance of doubt, to the extent that any reimbursements payable to Executive are subject to the provisions of Section 409A of the Internal Revenue Code of 1986, as amended (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.

 

3.                                            CONFIDENTIAL INFORMATION, INVENTIONS, NON-SOLICITATION AND NON-COMPETITION OBLIGATIONS.  In connection with Executive’s continued employment with the Company and in exchange for good and valuable consideration, Executive will continue to receive and continue to have access to the Company’s confidential information and trade secrets.  Accordingly, and in consideration of the benefits that Executive is eligible to receive under this Agreement, Executive agrees to sign the Company’s Employee Confidential Information, Inventions, Non-Solicitation and Non-Competition Agreement (the “Confidential Information Agreement”), attached as Exhibit B, which contains restrictive covenants and prohibits unauthorized use or disclosure of the Company’s confidential information and trade secrets, among other obligations.  The Confidential Information Agreement contains provisions that are intended by the parties to survive and do survive termination or expiration of this Agreement and will supersede, prospectively only, the agreement that Executive previously signed relating to the same subject matter.

 

4.                                            OUTSIDE ACTIVITIES.  Except with the prior written consent of the Board, 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 position with the Company, (iii) reasonable time serving as trustee, director, or advisor to any family companies or trusts, or (iv) with prior written notice to the

 

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Board, reasonable time devoted to service as a member of the board of directors (or its equivalent in the case of a non-corporate entity) of a non-competing business; so long as the activities set forth in clauses (i), (ii), (iii), and (iv) (A) do not, individually or in the aggregate, interfere with the performance of the Executive’s duties under this Agreement, (B) are not contrary to the interests of the Company or its Affiliates or competitive in any way with the Company its Affiliates or (C) are not in the field of constrained peptide drugs or therapeutics (including, without limitation, any work in the field of lead peptide identification and optimization and pre-clinical development of constrained peptide therapeutics).  In addition, the activities set forth in clauses (i), (ii), (iii), and (iv) may not exceed, in the aggregate, 6 days of Executive’s services per year, which permitted time commitment may be increased by the Board, in its discretion which shall not be unreasonably withheld, to up to 12 days per year where a new specific opportunity has been identified by Executive which would give Executive experience that is considered to be of wider benefit to the Company.  This restriction shall not, however, preclude Executive from (x) owning less than one percent (1%) of the total outstanding shares of a publicly traded company, (y) managing Executive’s passive personal investments, or (z) employment or service in any capacity with Affiliates of the Company.  As used in this Agreement, “Affiliates” means, at the time of determination, any “parent” or “subsidiary” of the Company as such terms are defined in Rule 405 of the Securities Act of 1933, as amended.  The Board will have the authority to determine the time or times at which “parent” or “subsidiary” status is determined within the foregoing definition.

 

5.                                      NO CONFLICT WITH EXISTING OBLIGATIONS.  Executive represents that Executive’s performance of all the terms of this Agreement and continued service as an employee of the Company do 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 or with Executive’s duties to the Company.

 

6.                                      TERMINATION OF EMPLOYMENT.  The parties acknowledge that Executive’s employment relationship with the Company continues to be at-will.  Either Executive or the Company may terminate the employment relationship at any time, with or without Cause (as defined below) 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 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 and Executive’s employment shall terminate immediately, and the Company shall, pursuant to the Company’s standard payroll policies and applicable law, pay to Executive’s legal representatives the Accrued Obligations (as defined in Section 6.2(d) below) due to Executive, along with any Special Bonus Payment (as that term is defined below).

 

(b)                                 Subject to applicable state and federal law, the Company shall at all times have the right, upon written notice to Executive, to terminate this Agreement based on Executive’s Disability (as defined below).  Termination by the Company of Executive’s employment

 

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based on “Disability” shall mean termination because Executive is unable due to a physical or mental condition to perform the essential functions of Executive’s position with or without reasonable accommodation for six (6) months 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 be entitled to the Accrued Obligations due to Executive, along with any Special Bonus Payment (as that term is defined below).

 

(c)                                  If the Executive’s termination due to death or Disability occurs between January 1 and the payment date of the Annual Bonus that Executive would have otherwise earned for performance in the calendar year preceding the termination due to death or Disability, then and only then will Executive be paid the full Annual Bonus amount that Executive would have otherwise earned for performance in such preceding calendar year (the “Special Bonus Payment”).

 

6.2                               Termination by the Company or Resignation by Executive.

 

(a)                                 The Company shall have the right to terminate Executive’s employment pursuant to this Section 6.2 at any time (subject to any applicable cure period stated in Section 6.2(f)) with or without Cause or advance notice, by giving notice as described in Section 7.1 of this Agreement.  Likewise, Executive can resign from employment with or without Good Reason, by giving notice as described in Section 7.1 of this Agreement.  Executive hereby agrees to comply with the additional notice requirements set forth in Section 6.2(e) below for any resignation for Good Reason.  If Executive is terminated by the Company (with or without Cause) or resigns from employment with the Company (with or without Good Reason), then Executive shall be entitled to the Accrued Obligations (as defined below).  In addition, if Executive is terminated without Cause or resigns 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”), and further provided that Executive executes and allows to become effective a separation agreement that includes, among other terms, a general release of claims in favor of the Company and its Affiliates and representatives and a non-competition clause, in the form presented by the Company (the “Separation Agreement”), and subject to Section 6.2(b) (the date that the general release of claims in the Separation Agreement becomes effective and may no longer be revoked by Executive is referred to as the “Release Date”), then Executive shall be eligible to receive the following severance benefits (collectively the “Non-CIC Severance Benefits”):

 

(i)                                    An amount equal to nine (9) months of Executive’s then current Base Salary, less standard payroll deductions and withholdings, paid in installments on the Company’s regular payroll dates; and

 

(ii)                                Provided Executive or Executive’s covered dependents, as the case may be, timely elects continued coverage under COBRA under the Company’s group health plans following such termination, the portion of the COBRA premiums which is equal to the cost of the coverage that the Company was paying as of the date of termination, to continue Executive’s (and Executive’s covered dependents, as applicable) health insurance coverage in effect on the termination date until the earliest of:  (1) nine (9) months following

 

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the termination date; (2) the date when Executive becomes eligible for substantially equivalent health insurance coverage in connection with new employment or self-employment; or (3) 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 (1)-(3), (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, for the remainder of the COBRA Payment Period.  Nothing in this Agreement shall deprive Executive of Executive’s rights under COBRA or ERISA for benefits under plans and policies arising under Executive’s employment by the Company.

 

(b)                                 Executive shall not receive the Non-CIC Severance Benefits pursuant to Section 6.2(a) unless Executive executes the Separation Agreement within the consideration period specified therein, which shall in no event be more than forty-five (45) days, and until the Separation Agreement becomes effective and can no longer be revoked by Executive under its terms.  Executive’s ability to receive benefits pursuant to Section 6.2(a) is further conditioned upon Executive:  (i) returning all Company property; (ii) complying with Executive’s post-termination obligations under this Agreement and the Confidential Information Agreement; (iii) complying with the Separation Agreement, including without limitation any non-disparagement, non-competition, and confidentiality provisions contained therein; and (iv) resignation from any other positions Executive holds with the Company, effective no later than Executive’s date of termination (or such other date as requested by the Board).

 

(c)                                  The Company will not make any payments to Executive with respect to any of the benefits pursuant to Section 6.2(a) prior to the 60th day following Executive’s date of termination.  On the first payroll date after the 60th day following Executive’s date of termination, and provided that Executive has delivered an effective Separation Agreement, the Company will make the first payment to Executive under Section 6.2(a)(i) and, in a lump sum, an amount equal to the aggregate amount of payments that the Company would have paid Executive through such date had the payments commenced on Executive’s date of termination through such 60th day, with the balance of the payments paid thereafter on the schedule described above, subject to any delay in payment required by Section 6.6.

 

(d)                                 For purposes of this Agreement, “Accrued Obligations” are (i) Executive’s accrued but unpaid salary through the date of termination and, if required by applicable law and the Company’s applicable policy as of the time of termination, any accrued but unused vacation through the date of termination (both of which, for purpose of clarity, shall be paid in cash), (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)                                  For purposes of this Agreement, “Good Reason” means any of the following actions taken by the Company without Executive’s express prior written consent:  (i) a material reduction by the Company of Executive’s Base Salary (other than in a broad based reduction similarly affecting all other members of the Company’s executive management); (ii) the relocation of Executive’s principal place of employment, without Executive’s consent, to a place that increases Executive’s one-way commute by more than fifty (50) miles as compared to Executive’s then-current principal place of employment immediately prior to such relocation; or (iii) a material reduction in Executive’s duties, authority, or responsibilities for the Company relative to Executive’s duties, authority, or responsibilities in effect immediately prior to such reduction; 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 Executive’s intent to terminate for Good Reason within thirty (30) days following Executive’s learning of the occurrence of the condition(s) that Executive 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 Executive’s employment within thirty (30) days following the end of the Cure Period.

 

(f)                                   For purposes of this Agreement, “Cause”  means (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 which is reasonably likely to cause harm (including reputational harm) to the Company; (iii) any conduct which constitutes a felony under applicable law; (iv) material violation of any Company policy (including but not limited to Company policies preventing harassment), after the expiration of thirty (30) days without cure after written notice of such violation to the extent such violation is curable; (v) refusal to follow or implement a clear, lawful and reasonable directive of Company after the expiration of thirty (30) days without cure after written notice of such failure to the extent such failure is curable; (vi) gross negligence or incompetence in the performance of Executive’s  duties after the expiration of thirty (30) days without cure after written notice of such failure; or (vii) breach of fiduciary duty.

 

(g)                                 The 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.

 

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

 

(i)                                    If the Company terminates Executive’s employment for Cause, or Executive resigns from employment with the Company without Good Reason, regardless of whether or not such termination is in connection with a Change in Control, then Executive shall be entitled to the Accrued Obligations, but Executive will not receive the Non-CIC Severance Benefits, the CIC Severance Benefits, or any other severance compensation or benefit.

 

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6.3                               Resignation by Executive for Good Reason or Termination by the Company without Cause (in connection with a Change in Control).

 

(a)                                 In the event that the Company terminates Executive’s employment without Cause or Executive resigns for Good Reason within twelve (12) months following the effective date of a Change in Control (“Change in Control Termination Date”), then Executive shall be entitled to the Accrued Obligations and, subject to Executive’s compliance with Section 6.2(b) above, Executive shall be eligible to receive the following severance benefits (collectively the “CIC Severance Benefits”), subject to the terms and conditions set forth in Section 6.3(b):

 

(i)                                    An amount equal to twelve (12) months of Executive’s then current Base Salary, less standard payroll deductions and withholdings, paid in installments on the Company’s regular payroll dates; and

 

(ii)                                Provided Executive or Executive’s covered dependents, as the case may be, timely elects continued coverage under COBRA under the Company’s group health plans following such termination, the portion of the COBRA premiums which is equal to the cost of the coverage that the Company was paying as of the date of termination, to continue Executive’s (and Executive’s covered dependents, as applicable) health insurance coverage in effect on the termination date until the earliest of:  (1) twelve (12) months following the termination date; (2) the date when Executive becomes eligible for substantially equivalent health insurance coverage in connection with new employment or self-employment; or (3) 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 (1)-(3), (the “CIC 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 CIC COBRA Payment Period, a fully taxable cash payment equal to the COBRA premium for such month, subject to applicable tax withholding, for the remainder of the CIC COBRA Payment Period.  Nothing in this Agreement shall deprive Executive of Executive’s rights under COBRA or ERISA for benefits under plans and policies arising under Executive’s employment by the Company;

 

(iii)                            A lump sum cash payment in an amount equal to the full Annual Bonus calculated at the Target Percentage for the year in which the termination occurs, subject to standard payroll deductions and withholdings; and

 

(iv)                             Effective as of Executive’s Change in Control Termination Date (and notwithstanding anything to the contrary in the applicable equity incentive plan(s) and the applicable award agreement(s) governing the terms of such equity awards), the vesting and exercisability of all outstanding equity awards held by Executive immediately prior to the Change in Control Termination Date shall be accelerated in full, and otherwise shall be administered in accordance with the applicable equity incentive plan(s) and the applicable award agreement(s) governing the terms of such equity awards.

 

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(b)                                 The Company will not make any payments to Executive with respect to any of the benefits pursuant to Section 6.3(a) prior to the 60th day following Executive’s date of termination.  On the first payroll date after the 60th day following Executive’s date of termination, and provided that Executive has delivered an effective Separation Agreement, the Company will (i) make the first payment to Executive under Section 6.2(a)(i) and, in a lump sum, an amount equal to the aggregate amount of payments that the Company would have paid Executive through such date had the payments commenced on Executive’s date of termination through such 60th day, with the balance of the payments paid thereafter on the schedule described above; and (ii) make the lump sum payment specified in Section 6.3(a)(iii) that has not yet been made due to this Section 6.3(b), in the cases of (i) and (ii) subject to any delay in payment required by Section 6.6.

 

(c)                                  The benefits provided to Executive pursuant to this Section 6.3 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.  For avoidance of doubt, Executive shall not be eligible for both CIC Severance and Non-CIC Severance.

 

(d)                                 Any damages caused by the termination of Executive’s employment without Cause or for Good Reason in connection with a Change in Control would be difficult to ascertain; therefore, the CIC Severance Benefits for which Executive is eligible pursuant to Section 6.3(a) above in exchange for the Separation Agreement is agreed to by the parties as liquidated damages, to serve as full compensation, and not a penalty.

 

6.4                               Cooperation With the Company After Termination of Employment.  Following termination of Executive’s employment for any reason, Executive shall reasonably cooperate with the Company in all matters relating to the winding up of Executive’s pending work including, but not limited to, any litigation in which the Company is involved, and the orderly transfer of any such pending work to such other executives as may be designated by the Company; provided, that the Company agrees that the Company (a) shall make reasonable efforts to minimize disruption of Executive’s other activities, and (b) shall reimburse Executive for all reasonable expenses incurred in connection with such cooperation.

 

6.5                               Effect of Termination.  Executive agrees that should Executive’s employment be terminated for any reason, Executive shall be deemed to have resigned from any and all positions with the Company, including, but not limited to, a position on the Board and all positions with any and all subsidiaries and Affiliates of the Company.

 

6.6                               Application of Section 409A.

 

(a)                                 It is intended that all of the compensation payable under this Agreement, to the greatest extent possible, either complies with the requirements of Section 409A of the Code and the regulations and other guidance thereunder and any state law of similar effect (collectively, “Section 409A”) or satisfies one or more of the exemptions from the application of Section 409A, and this Agreement will be construed in a manner consistent with such intention, incorporating by reference all required definitions and payment terms.

 

(b)                                 No severance payments will be made under this Agreement unless Executive’s termination of employment constitutes a Separation from Service.  For purposes of

 

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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.

 

(c)                                  To the extent that any severance payments are deferred compensation under Section 409A, and are not otherwise exempt from the application of Section 409A, then, to the extent required to comply with Section 409A, if the period during which Executive may consider and sign the Separation Agreement spans two calendar years, the severance payments will not begin until the second calendar year.  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, the Company will:  (i) pay to Executive a lump sum amount equal to the sum of the severance benefits that Executive would otherwise have received if the commencement of the payment of the severance benefits had not been delayed pursuant to this Section 6.6(c); and (ii) commence paying the balance of the severance benefits in accordance with the applicable payment schedule set forth in Sections 6.2 and 6.3.  No interest shall be due on any amounts deferred pursuant to this Section 6.6(c).

 

(d)                                 To the extent required to avoid accelerated taxation and/or tax penalties under Section 409A, amounts reimbursable to Executive under this Agreement shall be paid to Executive on or before the last day of the year following the year in which the expense was incurred and the amount of expenses eligible for reimbursement (and in-kind benefits provided to Executive) during any one year may not effect amounts reimbursable or provided in any subsequent year.  The Company makes no representation that compensation paid pursuant to the terms of this Agreement will be exempt from or comply with Section 409A and makes no undertaking to preclude Section 409A from applying to any such payment.

 

6.7                               Excise Tax Adjustment.

 

(a)                                 If any payment or benefit Executive will or may receive from the Company or otherwise (a “280G Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Code, and (ii) but for this Section, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then any such 280G Payment provided pursuant to this Agreement (a “Payment”) shall be equal to the Reduced Amount.  The “Reduced Amount” shall be either (x) the largest portion of the Payment that would result in no portion of the Payment (after reduction) being subject to the Excise Tax, or (y) the largest portion, up to and including the total, of the Payment, whichever amount (i.e., the amount determined by clause (x) or by clause (y)), 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), results in Executive’s receipt, on an after-tax basis, of the greater economic benefit notwithstanding that all or some portion of the Payment may be subject to the Excise Tax.  If a reduction in a Payment is required pursuant to the preceding sentence and the Reduced Amount is determined pursuant to clause (x) of

 

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the preceding sentence, the reduction shall occur in the manner (the “Reduction Method”) that results in the greatest economic benefit for Executive.  If more than one method of reduction will result in the same economic benefit, the items so reduced will be reduced pro rata (the “Pro Rata Reduction Method”).

 

(b)                                 Notwithstanding any provision of this Section 6.7 to the contrary, if the Reduction Method or the Pro Rata Reduction Method would result in any portion of the Payment being subject to taxes pursuant to Section 409A that would not otherwise be subject to taxes pursuant to Section 409A, then the Reduction Method and/or the Pro Rata Reduction Method, as the case may be, shall be modified so as to avoid the imposition of taxes pursuant to Section 409A as follows: (A) as a first priority, the modification shall preserve to the greatest extent possible, the greatest economic benefit for Executive as determined on an after-tax basis; (B) as a second priority, Payments that are contingent on future events (e.g., being terminated without Cause), shall be reduced (or eliminated) before Payments that are not contingent on future events; and (C) as a third priority, Payments that are “deferred compensation” within the meaning of Section 409A shall be reduced (or eliminated) before Payments that are not deferred compensation within the meaning of Section 409A.

 

(c)                                  Unless Executive and the Company agree on an alternative accounting firm or law firm, the accounting firm engaged by the Company for general tax compliance purposes as of the day prior to the effective date of the Change in Control transaction shall perform the foregoing calculations.  If the accounting firm so engaged by the Company is serving as accountant or auditor for the individual, entity, or group effecting the Change in Control transaction, the Company shall appoint a nationally recognized accounting or law firm to make the determinations required by this Section 6.7.  The Company shall bear all expenses with respect to the determinations by such accounting or law firm required to be made hereunder.  The Company shall use commercially reasonable efforts to cause the accounting or law firm engaged to make the determinations hereunder to provide its calculations, together with detailed supporting documentation, to Executive and the Company within fifteen (15) calendar days after the date on which Executive’s right to a 280G Payment becomes reasonably likely to occur (if requested at that time by Executive or the Company) or such other time as requested by Executive or the Company.

 

(d)                                 If Executive receives a Payment for which the Reduced Amount was determined pursuant to clause (x) of Section 6.7(a) and the Internal Revenue Service determines thereafter that some portion of the Payment is subject to the Excise Tax, Executive agrees to promptly return to the Company a sufficient amount of the Payment (after reduction pursuant to clause (x) of Section 6.7(a)) so that no portion of the remaining Payment is subject to the Excise Tax.  For the avoidance of doubt, if the Reduced Amount was determined pursuant to clause (y) of Section 6.7(a), Executive shall have no obligation to return any portion of the Payment pursuant to the preceding sentence.

 

7.                                            GENERAL PROVISIONS.

 

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

 

11

 

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 Executive’s address as listed on the Company payroll or (if notice is given prior to Executive’s termination of employment) to 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                               Waiver.  If either party should waive any breach of any provisions of this Agreement, Executive or the Company shall not thereby be deemed to have waived any preceding or succeeding breach of the same or any other provision of this Agreement.

 

7.4                               Complete Agreement.  This Agreement (including Exhibits A and B), and any other separate agreement relating to equity awards constitute the entire agreement between Executive and the Company with regard to the subject matter hereof and supersede any prior oral discussions or written communications and agreements, including the Prior Agreements.  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.

 

7.5                               Counterparts.  This Agreement may be executed by electronic transmission and 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.

 

7.6                               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.

 

7.7                               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 Executive’s estate upon Executive’s death.

 

7.8                               Choice of Law.  All questions concerning the construction, validity, and interpretation of this Agreement will be governed by the laws of the Commonwealth of Massachusetts.

 

12

 

7.9                               Resolution of Disputes.  To ensure the timely and economical resolution of disputes that may arise in connection with Executive’s employment with the Company, Executive and the Company agree that any and all disputes, claims, or causes of action arising from or relating to the enforcement, breach, performance, negotiation, execution, or interpretation of this Agreement, or Executive’s employment, or the termination of Executive’s employment, including but not limited to all statutory claims, will be resolved pursuant to the Federal Arbitration Act, 9 U.S.C. §1-16, and to the fullest extent permitted by law, by final, binding and confidential arbitration by a single arbitrator conducted in Boston, Massachusetts by Judicial Arbitration and Mediation Services Inc. (“JAMS”) under the then applicable JAMS rules (at the following web address: https://www.jamsadr.com/rules-employment-arbitration/); provided, however, this arbitration provision shall not apply to sexual harassment claims to the extent prohibited by applicable law.  A hard copy of the rules will be provided to Executive upon request.  By agreeing to this arbitration procedure, both Executive and the Company waive the right to resolve any such dispute through a trial by jury or judge or administrative proceeding.  In addition, all claims, disputes, or causes of action under this provision, whether by Executive or the Company, must be brought in an individual capacity, and shall not be brought as a plaintiff (or claimant) or class member in any purported class or representative proceeding, nor joined or consolidated with the claims of any other person or entity.  The arbitrator may not consolidate the claims of more than one person or entity, and may not preside over any form of representative or class proceeding.  To the extent that the preceding sentences regarding class claims or proceedings are found to violate applicable law or are otherwise found unenforceable, any claim(s) alleged or brought on behalf of a class shall proceed in a court of law rather than by arbitration.  The Company acknowledges that Executive will have the right to be represented by legal counsel at any arbitration proceeding.  Questions of whether a claim is subject to arbitration under this Agreement shall be decided by the arbitrator.  Likewise, procedural questions which grow out of the dispute and bear on the final disposition are also matters for the arbitrator.  The arbitrator shall:  (a) have the authority to compel adequate discovery for the resolution of the dispute and to award such relief as would otherwise be permitted by law; (b) issue a written arbitration decision, to include the arbitrator’s essential findings and conclusions and a statement of the award;  (c) be authorized to award any or all remedies that Executive or the Company would be entitled to seek in a court of law; and (d) is authorized to award attorneys’ fees to the prevailing party.  Subject to the foregoing sentence, the Company shall bear all JAMS’ arbitration fees, and each party is responsible for its own attorneys’ fees.  Nothing in this Agreement is intended to prevent either Executive or the Company from obtaining injunctive relief in court to prevent irreparable harm pending the conclusion of any such arbitration.  Any awards or orders in such arbitrations may be entered and enforced as judgments in the federal and state courts of any competent jurisdiction.  To the extent applicable law prohibits mandatory arbitration of sexual harassment claims, in the event Executive intends to bring multiple claims, including a sexual harassment claim, the sexual harassment claim may be publicly filed with a court, while any other claims will remain subject to mandatory arbitration.

 

[Remainder of page intentionally left blank.]

 

13

 

IN WITNESS WHEREOF, the parties have executed this Amended and Restated Employment Agreement on the day and year first written above.

 

	
 
    	
BICYCLE   THERAPEUTICS INC.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Travis Thompson
    
	
 
    	
 
    	
Name: Travis Thompson
    
	
 
    	
 
    	
Title: Secretary
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
EXECUTIVE:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Lee Kalowski
    
	
 
    	
Lee   Kalowski
    

 

14

 

Exhibit A

 

CHANGE IN CONTROL

 

“Change in Control” means and includes each of the following:

 

(a)                                 a Sale; or

(b)                                 a Takeover.

 

The Compensation Committee of the Board of BTL shall have full and final authority, which shall be exercised in its sole discretion, to determine conclusively whether a Change in Control has occurred pursuant to the above definition, the date of the occurrence of such Change in Control and any incidental matters relating thereto; provided that any such Change in Control also qualifies as a “change in control event” as defined in Section 409A of the United States Internal Revenue Code of 1986, as amended and the regulations and other guidance thereunder and any state law of similar effect, and any exercise of authority in conjunction with a determination of whether a Change in Control is a “change in control event” is consistent with such regulation.

 

“Control” shall have the meaning given to that word by Section 719 of the UK Income Tax (Earnings and Pensions) Act 2003 and “Controlled” shall be construed accordingly.

 

“Sale” means the sale of all or substantially all of the assets of BTL.

 

“Takeover” means circumstances in which any person (or a group of persons acting in concert) (the “Acquiring Person”):

 

(a)                                 obtains Control of BTL as the result of making a general offer to:-

i.                                          acquire all of the issued ordinary share capital of BTL, which is made on a condition that, if it is satisfied, the Acquiring Person will have Control of BTL; or

ii.                                       acquire all of the shares in BTL; or

(b)                                 obtains Control of BTL as a result of a compromise or arrangement sanctioned by a court under Section 899 of the UK Companies Act 2006, or sanctioned under any other similar law of another jurisdiction; or

(c)                                  becomes bound or entitled under Sections 979 to 985 of the UK Companies Act 2006 (or similar law of another jurisdiction) to acquire shares in BTL or

(d)                                 obtains Control of BTL in any other way, including but not limited to by way of a merger.

 

 

Exhibit B

 

EMPLOYEE CONFIDENTIAL INFORMATION, INVENTIONS, NON-SOLICITATION AND NON-COMPETITION AGREEMENT

 

2Exhibit 10.22

 

CONTRACT

 

THIS
AGREEMENT effective this 1st of June, 2019, by and between HyperSolar, Inc (hereafter referred to as “Sponsor”)
and The University of Iowa, Iowa City, Iowa, a non-profit educational institution (hereinafter referred to as “University”).

 

WITNESSETH:

 

WHEREAS,
the research program contemplated by this Agreement is of mutual interest and benefit to University and to Sponsor, will further
the instructional and research objectives of University in a manner consistent with its status as a non- profit, tax-exempt, educational
institution, and may derive benefits for both Sponsor and University through inventions, improvements, and/or discoveries;

 

NOW,
THEREFORE, in consideration of the premises and mutual covenants herein contained, the parties hereto agree to the following:

 

ARTICLE
1 - Definitions

 

As
used herein, the following terms shall have the following meanings:

 

	1.1	“Project”
                                         shall mean the description of the project as described in Exhibit A hereof, under the
                                         direction of Syed Mubeen as Principal Investigator.
	 	 
	1.2	“Contract
                                         Period” is June 1, 2019, through May 31, 2020.
	 	 
	1.3	“University
                                         Intellectual Property” shall mean individually and collectively all inventions,
                                         improvements and/or discoveries which are conceived and/or made (i) by one or more employees
                                         of University, or (ii) jointly by one or more employees of University and by one or more
                                         employees/consultants of Sponsor, in performance of the Project.

 

ARTICLE
2 - Research Work

 

	2.1	University
                                         shall commence performance of the Project promptly after the effective date of this Agreement,
                                         and shall use all reasonable efforts, care, and diligence to perform such Project in
                                         accordance with the terms and conditions of this Agreement. Anything in this Agreement
                                         to the contrary notwithstanding, Sponsor and University may at any time amend the Project
                                         by mutual written agreement.
	 	 
	2.2	In
                                         the event that the Principal Investigator becomes unable or unwilling to continue the
                                         Project, and a mutually acceptable substitute is not available, University and/or Sponsor
                                         shall have the option to terminate said Project pursuant to Article 10.1.
	 	 
	2.3	The
                                         University does not comply with Good Laboratory Practices (GLPs) as defined by the U.S.
                                         Food and Drug Administration in 21 C.F.R. 58.

 

    -1-

     

    

 

ARTICLE
3 - Reports and Conferences

 

	3.1	Written
                                         program reports shall be provided by University to Sponsor every six (6) months, and
                                         a final report shall be submitted by University within forty-five (45) days of the conclusion
                                         of the Contract Period, or the earlier termination of this Agreement.
	 	 
	3.2	During
                                         the term of this Agreement, representatives of University will meet with representatives
                                         of Sponsor at times and places mutually agreed upon to discuss the progress and results,
                                         as well as ongoing plans, or changes therein, of the Project to be performed hereunder.

 

ARTICLE
4 - Costs, Billings, and Other Support

 

	4.1	It
                                         is agreed to and understood by the parties hereto that, subject to Article 2, total costs
                                         to Sponsor hereunder shall not exceed the sum of One Hundred and Forty Four Thousand
                                         and Seven Hundred and Forty Seven Dollars ($144,747). Payment shall be made by
                                         Sponsor according to the following schedule:

 

Four
(4) Quarterly Payments of $36,187.75

 

	4.2	Invoices
                                         shall be submitted to the Sponsor representative listed in Article 17 for submission
                                         of invoices. Payments to University shall include Sponsor name, Principal Investigator
                                         name, project title and shall be submitted to the University representative listed in
                                         Article 17 for payment remittance.
	 	 
	4.3	[Sponsor
                                         shall loan/donate the following equipment to University under the following conditions:Not
                                         Applicable.] University shall retain title to any equipment purchased with
                                         funds provided by Sponsor under this Agreement.
	 	 
	4.4	Anything
                                         herein to the contrary notwithstanding, in the event of early termination of this Agreement
                                         by Sponsor pursuant to Article 10.1 hereof, Sponsor shall pay all costs accrued by University
                                         as of the date of termination, including non-cancelable obligations, which shall include
                                         all non-cancelable contracts and fellowships or postdoctoral associate appointments called
                                         for in Appendix A, incurred prior to the effective date of termination. After termination,
                                         any obligation of Sponsor for fellowships or postdoctoral associates shall end no later
                                         than the end of University’s academic year following termination.

 

ARTICLE
5 - Publicity

 

	5.1	Sponsor
                                         shall not use the name of University, nor of any member of University’s Project staff,
                                         in any publicity, advertising, or news release or in any way imply endorsement of the
                                         University without the prior written approval of an authorized representative of University.
                                         University shall not use the name of Sponsor, nor any employee of Sponsor, in any publicity
                                         without the prior written approval of Sponsor. University may disclose, without Sponsor’s
                                         approval, the terms of this Agreement that are a matter of public record under the Iowa
                                         Open Records Law, Iowa Code Chapter 22.

 

    -2-

     

    

 

ARTICLE
6 - Publications

 

	6.1	Sponsor
                                         recognizes that under University policy, the results of University research must be publishable
                                         and agrees that researchers engaged in the Project shall be permitted to present research
                                         results at symposia, national or regional professional meetings, and to publish in journals,
                                         theses or dissertations, or otherwise of their own choosing, methods and results of the
                                         Project, provided, however, that Sponsor shall have been furnished copies of any proposed
                                         publication or presentation at least one (1) month in advance of the submission of such
                                         proposed publication or presentation to a journal, editor, or other third party. Sponsor
                                         shall have thirty (30) days, after receipt of said copies, to object to such proposed
                                         presentation or proposed publication because there is patentable subject matter or proprietary
                                         information of Sponsor that needs protection. In the event that Sponsor makes such objection,
                                         said researcher(s) shall refrain from making such publication or presentation for a maximum
                                         of six (6) months from date of receipt of such objection in order for University to file
                                         patent application(s) with the United States Patent and Trademark Office and/or foreign
                                         patent office(s) directed to the patentable subject matter contained in the proposed
                                         publication or presentation. Sponsor does not possess a right to delay publication if
                                         the publication or presentation contains only findings and conclusions of basic science
                                         or results that would not affect the ability of Sponsor to obtain a patent.

 

ARTICLE
7 - Proprietary Information

 

	7.1	It
                                         is the responsibility of Sponsor to mark or otherwise identify in writing prior to submission
                                         any information considered confidential that it deems necessary to share with University
                                         (“Confidential Information”). Oral disclosures of Confidential Information
                                         shall be identified as confidential at the time of disclosure and confirmed in writing
                                         within ten (10) business days of the disclosure. University shall have the right to accept
                                         or reject Sponsor’s Confidential Information. If such information is accepted it
                                         will be withheld by University from publication, and in all other respects shall be maintained
                                         by University as confidential and proprietary to Sponsor for a period of five (5) years
                                         after termination of this Agreement. University shall have no such obligation with respect
                                         to any portion of such Confidential Information which:

 

		a)	is
                                         or later becomes generally available to the public by use, publication or the like, through
                                         no fault of University;
	 	 	 
		b)	is
                                         obtained on a non-confidential basis from a third party who disclosed the same to University;
	 	 	 
		c)	University
                                         already possesses, as evidenced by its written records, predating receipt thereof from
                                         Sponsor; or
	 	 	 
		d)	is
                                         required to be disclosed by law, regulation or court order.

 

	7.2	All
                                         documentation concerning University Intellectual Property submitted to Sponsor in accordance
                                         with Article 8.4 shall be treated as confidential in order to preserve any patent rights.

 

    -3-

     

    

 

ARTICLE
8 - Intellectual Property

 

	8.1	All
                                         rights, title and interest to University Intellectual Property under the Project, except
                                         as provided in Article 8.3, shall belong to University and shall be subject to the terms
                                         and conditions of this Agreement.
	 	 
	8.2	Rights
                                         to inventions, improvements, and/or discoveries, whether patentable or copyrightable
                                         or not, relating to the Project made solely by employees/consultants of Sponsor shall
                                         belong to Sponsor. Such inventions, improvements, and/or discoveries shall not be subject
                                         to the terms and conditions of this Agreement.
	 	 
	8.3	Rights
                                         to inventions, improvements, and/or discoveries conceived and/or made during the Contract
                                         Period, whether patentable or copyrightable or not, relating to the Project, which are
                                         made jointly by employees of University and employees/consultants of Sponsor, shall be
                                         the joint property of University and Sponsor and shall be subject to the terms and conditions
                                         of this Agreement.
	 	 
	8.4	University
                                         will promptly notify Sponsor of any University Intellectual Property conceived and/or
                                         made during the Contract Period under the Project. If Sponsor directs that a patent application
                                         or application for other intellectual property protection be filed, University shall
                                         promptly prepare, file, and prosecute such U.S. and foreign application in University’s
                                         name, and Sponsor’s name if jointly invented. Sponsor shall bear all costs incurred
                                         in connection with such preparation, filing, prosecution, and maintenance of U.S. and
                                         foreign application(s) directed to said University Intellectual Property. Sponsor shall
                                         cooperate with University to assure that such application(s) will cover, to the best
                                         of Sponsor’s knowledge, all items of commercial interest and importance. While University
                                         shall be responsible for making decisions regarding scope and content of application(s)
                                         to be filed and prosecution thereof, Sponsor shall be given an opportunity to review
                                         and provide input thereto. University shall keep Sponsor advised as to all developments
                                         with respect to such application(s) and shall promptly supply to Sponsor copies of all
                                         papers received and filed in connection with the prosecution thereof in sufficient time
                                         for Sponsor to comment thereon.
	 	 
	8.5	If
                                         Sponsor elects not to exercise its option granted in Article 9.1 or decides to discontinue
                                         the financial support of the prosecution and maintenance of the patent protection, all
                                         right, title and interest in such patent, patent application, and University Intellectual
                                         Property shall automatically revert to University. University shall then be free to file
                                         or continue prosecution or maintain any such application(s), and to maintain any protection
                                         issuing thereon in the U.S. and in any foreign country at University’s sole expense.

 

ARTICLE
9 - Grant of Rights

 

	9.1	Subject
                                         to Article 8.3, University grants Sponsor the first option to elect an exclusive license
                                         to University Intellectual Property developed under this Agreement, and a right to sub-license
                                         any and all University Intellectual Property developed under this Agreement on terms
                                         and conditions to be mutually agreed upon. If Sponsor elects to exercise this option,
                                         Sponsor shall notify University in writing of its decision within one (1) year from the
                                         date of termination of this Agreement.
	 	 
	9.2	No
                                         grant described in this Article shall be construed to limit University’s right
                                         to utilize University Intellectual Property for research, instruction or academic publication
                                         purposes.

 

    -4-

     

    

 

ARTICLE
10 - Term and Termination

 

	10.1	This
                                         Agreement shall become effective upon the date first hereinabove written and shall continue
                                         in effect for the full duration of the Contract Period unless sooner terminated in accordance
                                         with the provisions of this Article. The parties hereto may, however, extend the term
                                         of this Agreement for additional periods as desired under mutually agreeable terms and
                                         conditions which the parties reduce to writing and sign. Either party may terminate this
                                         Agreement upon sixty (60) days prior written notice to the other.
	 	 
	10.2	In
                                         the event that either party hereto shall commit any material breach or default in any
                                         of the terms or conditions of this Agreement, and also shall fail to remedy such default
                                         or breach within ninety (90) days after receipt of written notice thereof from the other
                                         party hereto, the party giving notice may, at its option and in addition to any other
                                         remedies which it may have at law or in equity, terminate this Agreement by sending notice
                                         of termination in writing to the other party to such effect, and such termination shall
                                         be effective as of the date of the receipt of such notice.
	 	 
	10.3	Termination
                                         of this Agreement by either party for any reason shall not affect the rights and obligations
                                         of the parties accrued prior to the effective date of termination of this Agreement.
                                         No termination of this Agreement, however effectuated, shall release the parties hereto
                                         from their rights and obligations under Articles 3.1, 4, 5, 6, 7, 8, 9 and 11.

 

ARTICLE
11 - Independent Contractor

 

	11.1	In
                                         the performance of all services hereunder University shall be deemed to be and shall
                                         be an independent contractor and, as such, University shall not be entitled to any benefits
                                         applicable to employees of Sponsor.
	 	 
	11.2	Neither
                                         party is authorized or empowered to act as agent for the other for any purpose and shall
                                         not on behalf of the other enter into any contract, warranty, or representation as to
                                         any matter. Neither shall be bound to the acts or conduct of the other.

 

ARTICLE
12 – Insurance

 

	12.1	Each
                                         party shall be liable for any and all claims for wrongful death, personal injury or property
                                         damage attributable to the negligent acts or omissions of that party and the officers,
                                         employees, and agents thereof.

 

	12.2	University
                                         shall be responsible and agrees to pay for any and all claims for wrongful death, personal
                                         injury or property damage directly resulting from the negligence of University, its officers,
                                         employees and agents, and arising from activities under this Agreement to the full extent
                                         permitted by Chapter 669, Code of Iowa, which is the exclusive remedy for processing
                                         tort claims against the State of Iowa.

 

    -5-

     

    

 

ARTICLE
13 - Governing Law

 

	13.1	This
                                         Agreement shall be governed and construed in accordance with the substantive laws of
                                         the State of Iowa, excluding its conflict of laws provisions.

 

ARTICLE
14 - Assignment

 

	14.1	This
                                         Agreement shall not be assigned by either party without the prior written consent of
                                         the parties hereto.
	 	 
	14.2	This
                                         Agreement is assignable to any division of Sponsor, any majority stockholder of Sponsor,
                                         and/or any subsidiary of Sponsor, provided that such assignee assumes all of the rights,
                                         obligations and liabilities of Sponsor hereunder.

 

ARTICLE
15 - Agreement Modification

 

	15.1	Any
                                         agreement to change the terms of this Agreement in any way shall be valid only if the
                                         change is made in writing and approved by mutual agreement of authorized representatives
                                         of the parties hereto.

 

ARTICLE
16 - Warranties

 

	16.1	NO
                                         WARRANTIES, EITHER EXPRESSED OR IMPLIED, ARE MADE PART OF THIS AGREEMENT.

 

ARTICLE
17 - Export Control

 

	17.1	The
                                         disclosing party agrees to share any export control determinations when products, services,
                                         and/or technical data under this Agreement are subject to export controls under U.S.
                                         Government export laws and regulations; however, each party will be solely responsible
                                         for compliance with U.S. Government export laws and regulations.

 

    -6-

     

    

 

ARTICLE
18 - Notices

 

	18.1	Notices,
                                         invoices, and communications, hereunder shall be given by registered or certified mail,
                                         or express delivery service, postage or delivery charge prepaid, and addressed to the
                                         party to receive such notice, invoice, or communication at the address given below, or
                                         such other address as may hereafter be designated by notice in writing. Notice shall
                                         be deemed made on the date of receipt.

 

If
to Sponsor:

 

Tim
Young, CEO

HyperSolar, Inc

Phone:
(310)486-0740

E-mail:
tyoung@hypersolar.com

 

For Submission of Invoices:

 

HyperSolar,
Inc.

32
E. Micheltorena, Suite A Santa

Barbara, CA 93101

Phone:
805-966-6566

Fax:
805-617-3601

E-mail:
tyoung@hypersolar.com

 

	 	If
    to University:	The
    University of Iowa

Division
of Sponsored Programs

Attention:
_________________

2 Gilmore Hall

Iowa
City, Iowa 52242

Phone: 319-335-2123

Fax:
319-335-2130

E-mail:

 

For
Payment Remittance:

The
University of Iowa

Grant Accounting Office

B5 Jessup Hall

Iowa
City, Iowa 52242-1316

Phone: 319-335-3801

Fax:
319-335-0674

 

    -7-

     

    

 

IN
WITNESS WHEREOF, the parties, duly authorized, have executed this Agreement in duplicate as of the day and year first written
above.

 

	HYPERSOLAR,
    INC. (SPONSOR)	 	THE
    UNIVERSITY OF IOWA
	 	 	 	 	 
	/s/
    Timothy Young	 	/s/
    Jennifer Lassner
	By:	Timothy
    Young	 	By:	Jennifer
    Lassner
	Title:	President
    and CEO	 	Title:	Executive
    Director of Sponsored Programs
	 	 	 	 	 
	Date:	June
    1, 2019	 	Date:	June
    26, 2019

 

 

Rev.
03/30/2012

 

 -8-

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