Document:

aveo-ex1022_295.htm

 

EXHIBIT 10.22

SEVERANCE AND CHANGE IN CONTROL AGREEMENT 

THIS SEVERANCE AND CHANGE IN CONTROL AGREEMENT (the “Agreement”), made this ____day of November 2017 (the “Effective Date”), is entered into by AVEO Pharmaceuticals, Inc., a Delaware corporation with its principal place of business at 1 Broadway 14th Floor, Cambridge, MA 02142 (the “Company”), and Nikhil Mehta (the “Employee”). 

WHEREAS, the Company has determined that appropriate steps should be taken to reinforce and encourage the employment and dedication of the Employee and the Employee’s efforts to maximize the Company’s value. 

NOW, THEREFORE, as an inducement for and in consideration of the Employee’s employment with the Company and as consideration for the Employee’s agreement to enter into and be bound by the provisions of Section 4 hereof, the Company agrees that the Employee shall receive the severance benefits set forth in this Agreement in the event the Employee’s employment with the Company is terminated under the circumstances described below. 

1. Key Definitions. 

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

1.1 “Cause” means conduct involving one or more of the following: (i) the conviction of the Employee of, or, plea of guilty or nolo contendere to, any crime involving dishonesty or any felony; (ii) the willful misconduct by the Employee resulting in material harm to the Company; (iii) fraud, embezzlement, theft or dishonesty by the Employee against the Company resulting in material harm to the Company; (iv) the repeated and continuing failure of the Employee to follow the proper and lawful directions of the Company’s Chief Executive Officer or the Board after a written demand is delivered to the Employee that specifically identifies the manner in which the Chief Executive Officer or the Board believes that the Employee has failed to follow such instructions; (v) the Employee’s current alcohol or prescription drug abuse affecting work performance, or current illegal use of drugs regardless of the effect on work performance; (vi) material violation of the Company’s code of conduct by the Employee that causes harm to the Company; or (vii) the Employee’s material breach of any term of the Agreement, or any other applicable confidentiality and/or non-competition agreements with the Company. 

1.2 “Good Reason” means the occurrence, without the Employee’s written consent, of any of the following events: (A)  any material diminution in the Employee’s duties, responsibilities or authority, or (B) a material reduction in the Employee’s base salary (unless such reduction is effected in connection with a general and proportionate reduction of compensation for all employees of his or her level), provided, however, that Good Reason can only occur if (i) the Employee has given the Company a written notice of termination indicating the existence of a condition giving rise to Good Reason and the Company has not cured the condition giving rise to Good Reason within thirty (30) days after receipt of such notice of termination, and (ii) such notice of termination is given within ninety (90) days after the initial occurrence of the condition giving rise to Good Reason and further provided that a termination for Good Reason shall occur no more than one hundred eighty (180) days after the initial occurrence of the condition giving rise to Good Reason. 

1.3 “Disability” means (i) the Employee is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months or (ii) the Employee is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve 

 

 

(12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company; provided that in each case, the Employee’s physical or mental impairment shall be determined by an independent qualified physician mutually acceptable to the Company and the Employee (or his personal representative) or, if the Company and the Employee (or such representative) are unable to agree on an independent qualified physician, as determined by a panel of three physicians, one designated by the Company, one designated by the Employee (or his personal representative) and one designated by the two physicians so designated. 

2. Termination Without Cause or for Good Reason. 

2.1 Other than as set forth in Section 3 below, if the Employee’s employment with the Company is terminated by the Company without Cause or due to the Employee’s Disability, or by the Employee for Good Reason, then the Company shall: 

(a) continue to pay the Employee his base salary in effect on the date of termination, to be paid in accordance with the Company’s customary payroll practices as are established or modified from time to time as follows for the period of time set forth below (the “Severance Period”):

(i) if the termination occurs prior to June 30, 2018, then Company shall pay the Employee his base salary until the earlier of (x) the date six (6) months following the date of termination, or (y) the date on which the Employee commences employment or a consulting relationship with substantially equivalent compensation; 

(ii) if the termination occurs on or after June 30, 2018, then the Company shall pay the Employee his base salary until the earlier of (x) the date twelve (12) months following the date of termination, or (y) the date on which the Employee commences employment or a consulting relationship with substantially equivalent compensation; 

(b) pay to the Employee (i) on the date of termination, any base salary earned but not paid and any vacation accrued but not used through the date of termination, and (ii) within thirty (30) days after the date of termination, any reimbursable business expenses incurred by the Employee through the date of termination pursuant to any expense reimbursement policies of the Company then in effect; and 

 

(c) to the extent the Employee and any qualified beneficiary with respect to such Employee elects continuation of health benefit coverage under Section 4980B (“COBRA”) of the Internal Revenue Code of 1986, as amended (the “Code”), and continues to be eligible for such benefits, the Company shall provide payments to the Employee for such benefits equal to the amount contributed for active employees with similar benefits and similar participating beneficiaries until the earlier of (x) the Severance Period, or (y) the date the Employee becomes eligible for group health coverage through another employer. 

2.2 Except for the payments under Section 2(b) (which are not contingent upon the Employee’s execution of a release of claims), the payments and benefits to the Employee under this Section 2 shall (i) be contingent upon the execution and non-revocation by the Employee of a general release of claims in favor of the Company, in the form provided by the Company at the time of the Employee’s termination (the “Release”) within sixty (60) days following the date of termination (the “Release Period”); provided that if the Release does not become effective during the Release Period, the payments and benefits described in Sections 2.1(a) and 2.1(c) of this Agreement that commenced following the date of termination shall cease following the Release Period and (ii) constitute the sole remedy of the Employee in the event of a termination of the Employee’s employment in the circumstances set forth in this Section 2. 

 

 

2.3 Notwithstanding anything herein to the contrary, all benefits under this Section 2 shall terminate immediately if the Employee, at any time, violates any proprietary information, assignment of inventions agreement, confidentiality, non-competition or non-solicitation obligation to the Company, or any other continuing obligation to the Company. 

3. Termination upon a Change in Control. 

If the Employee is an “Eligible Employee” as defined in the Key Employee Change in Control Benefits Plan adopted by the Company in December 2007, as amended and as may be amended in the future (the current terms of which are attached hereto as Exhibit A) (the “Change in Control Plan”) at the time of a Change in Control, as defined in said Change in Control Plan, then any termination of the Employee’s employment following such Change in Control shall be governed by the terms of the Change in Control Plan and no benefits shall be provided under the terms of this Agreement.

 

4. Non-Competition and Non-Solicitation. 

4.1 Restricted Activities. While the Employee is employed by the Company and for a period of one (1) year after the termination or cessation of such employment for any reason, the Employee will not: 

(a) directly engage in the development or commercialization of a Competitive Product for another business or enterprise. For purposes of this provision, a “Competitive Product” means any therapeutic or diagnostic product that competes with any product that the Company (i) has, as of the date of cessation of the Employee’s employment with the Company, developed to the stage of readiness for a phase 2 clinical trial or later; or (ii) has sold at any time during the Employee’s employment with the Company or plans to commence selling during the one year period after the cessation of the Employee’s employment;

(b) directly or indirectly either alone or in association with others (i) solicit, or permit any organization directly or indirectly controlled by the Employee to solicit, any employee of the Company to leave the employ of the Company, or (ii) solicit for employment, hire as an employee or engage as an independent contractor, or permit any organization directly or indirectly controlled by the Employee to solicit for employment, hire as an employee or engage as an independent contractor, any person who was employed or engaged by the Company at the time of the termination or cessation of the Employee’s employment with the Company or within six months preceding such termination or cessation; provided, that this clause (ii) shall not apply to the solicitation, hiring or engagement of any individual whose employment with the Company has been terminated for a period of six months or longer; or 

(c) directly or indirectly make any statements that are professionally or personally disparaging about, or adverse to, the interests of the Company (including its officers, directors, employees and consultants) including, but not limited to, any statements that disparage any person, product, service, finances, financial condition, capability or any other aspect of the Company’s business, or engage in any conduct which could reasonably be expected to harm professionally or personally the Company’s business or reputation (including its officers, directors, employees and consultants); provided that these obligations in Section 4.1(c) will not prevent the Employee from engaging in ordinary business competition with the Company after the provisions of Section 4.1(a) have expired, providing truthful information to any regulatory agency or providing truthful testimony in any litigation involving the Company or its officers, directors, employees and consultants. 

If the Employee violates or breaches any of the provisions of this Section 4.1, then the provisions of this Section 4 shall be applicable to the Employee until a period of one year has expired without any violation or breach of such provisions. 

 

 

4.2 Interpretation. If any restriction set forth in Section 4.1 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable. 

4.3 Equitable Remedies. The restrictions contained in this Section 4 are necessary for the protection of the business and goodwill of the Company and are considered by the Employee to be reasonable for such purpose. The Employee agrees that any breach of this Section 4 is likely to cause the Company substantial and irrevocable damage which is difficult to measure. Therefore, in the event of any such breach or threatened breach, the Employee agrees that the Company, in addition to such other remedies which may be available, shall have the right to obtain an injunction from a court restraining such a breach or threatened breach and the right to specific performance of the provisions of this Section 4 and the Employee hereby waives the adequacy of a remedy at law as a defense to such relief. 

5. Taxes. 

5.1 The payments set forth in Sections 2 and 3 above shall be subject to the withholding of such amounts, if any, relating to tax and other payroll deductions as the Company determines are reasonably required pursuant to any applicable law or regulation. Neither the Employee nor the Company shall have the right to accelerate or to defer the delivery of the payments to be made under Sections 2 and 3 of this Agreement. 

 

5.2 Subject to this Section 5.2, payments or benefits under this Agreement shall begin only upon the date of a “separation from service” of the Employee (determined as set forth below) which occurs on or after the termination of the Employee’s employment. The following rules shall apply with respect to distribution of the payments and benefits, if any, to be provided to the Employee under this Agreement: 

(a) It is intended that each installment of the payments and benefits provided under this Agreement shall be treated as a separate “payment” for purposes of Section 409A of the Code and the guidance issued thereunder (“Section 409A”). Neither the Company nor the Employee shall have the right to accelerate or defer the delivery of any such payments or benefits except to the extent specifically permitted or required by Section 409A; 

(b) If, as of the date of the “separation from service” of the Employee from the Company, the Employee is not a “specified employee” (each within the meaning of Section 409A), then each installment of the payments and benefits shall be made on the dates and terms set forth in this Agreement; 

(c) If, as of the date of the “separation from service” of the Employee from the Company, the Employee is a “specified employee” (each, for purposes of this Agreement, within the meaning of Section 409A), then: 

(x) Each installment of the payments and benefits due under this Agreement that, in accordance with the dates and terms set forth herein, will in all circumstances, regardless of when the separation from service occurs, be paid within the short-term deferral period (as defined in Section 409A) shall be treated as a short-term deferral within the meaning of Treasury Regulation Section 1.409A-1(b)(4) to the maximum extent permissible under Section 409A; and 

(y) Each installment of the payments and benefits due under this Agreement that is not described in Section 5(c)(x) and that would, absent this subsection, be paid within the six-month period following the “separation from service” of the Employee of the Company shall not be paid until the date that is six months and one day after such separation from service (or, if earlier, the death of the Employee), with any such installments that are required to be delayed being accumulated during the six-month period and paid in a lump sum on the date 

 

 

that is six months and one day following the Employee’s separation from service and any subsequent installments, if any, being paid in accordance with the dates and terms set forth herein; provided, however, that the preceding provisions of this sentence shall not apply to any installment of payments and benefits if and to the maximum extent that that such installment is deemed to be paid under a separation pay plan that does not provide for a deferral of compensation by reason of the application of Treasury Regulation 1.409A-1(b)(9)(iii) (relating to separation pay upon an involuntary separation from service). Such payments shall bear interest at an annual rate equal to the prime rate as set forth in the Eastern edition of the Wall Street Journal on the Date of Termination, from the Date of Termination to the date of payment. Any installments that qualify for the exception under Treasury Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the last day of the second taxable year of the Employee following the taxable year of the Employee in which the separation from service occurs. 

(d) The determination of whether and when a separation from service of the Employee from the Company has occurred shall be made and in a manner consistent with, and based on the presumptions set forth in, Treasury Regulation Section 1.409A-1(h). Solely for purposes of this Section 5(d), “Company” shall include all persons with whom the Company would be considered a single employer as determined under Treasury Regulation Section 1.409A-1(h)(3). 

(e) All reimbursements and in-kind benefits provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A to the extent that such reimbursements or in-kind benefits are subject to Section 409A, including, where applicable, the requirements that (i) any reimbursement is for expenses incurred during the Executive’s lifetime (or during a shorter period of time specified in this Agreement), (ii) the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year, (iii) the reimbursement of an eligible expense will be made on or before the last day of the calendar year following the year in which the expense is incurred and (iv) the right to reimbursement is not subject to set off or liquidation or exchange for any other benefit. 

(f) Notwithstanding anything herein to the contrary, the Company shall have no liability to the Employee or to any other person if the payments and benefits provided in this Agreement that are intended to be exempt from or compliant with Section 409A are not so exempt or compliant. 

6. Other Employment Termination. If the Employee’s employment terminates for any reason other than as described in Sections 2 and 3, the Employee shall only receive any compensation owed to such Employee as of the termination date and any other post-termination benefits which the Employee is eligible to receive under any plan or program of the Company. 

7. Successors. 

7.1 Successor to Company. The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Company expressly to assume and agree to perform this Agreement to the same extent that the Company would be required to perform it if no such succession had taken place. All covenants and agreements hereunder shall inure to the benefit of and be enforceable by such successors or assigns without the necessity that this Agreement be re-signed at the time of such assignment. As used in this Agreement, “Company” shall mean the Company as defined above and any successor to its business or assets as aforesaid which assumes and agrees to perform this Agreement, by operation of law or otherwise. 

 

7.2 Successor to Employee. This Agreement shall inure to the benefit of and be enforceable by the Employee’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If the Employee should die while any amount would still be payable to the Employee or the Employee’s family hereunder if the Employee had continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to the executors, personal representatives or administrators of the Employee’s estate. 

 

 

8. Notices. All notices, instructions and other communications given hereunder or in connection herewith shall be in writing. Any such notice, instruction or communication shall be sent either (i) by registered or certified mail, return receipt requested, postage prepaid, or (ii) prepaid via a reputable nationwide overnight courier service, in each case addressed to the Company, at 1 Broadway 14th Floor, Cambridge, MA 02142, ATTN: Michael Bailey, Chief Executive Officer, and to the Employee at the Employee’s address indicated in the introduction to this Agreement (or to such other address as either the Company or the Employee may have furnished to the other in writing in accordance herewith). Any such notice, instruction or communication shall be deemed to have been delivered five business days after it is sent by registered or certified mail, return receipt requested, postage prepaid, or one business day after it is sent via a reputable nationwide overnight courier service. Either party may give any notice, instruction or other communication hereunder using any other means, but no such notice, instruction or other communication shall be deemed to have been duly delivered unless and until it actually is received by the party for whom it is intended. 

9. Miscellaneous. 

9.1 Employment by Subsidiary. For purposes of this Agreement, the Employee’s employment with the Company shall not be deemed to have terminated solely as a result of the Employee continuing to be employed by a wholly-owned subsidiary of the Company. 

9.2 Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. 

9.3 Governing Law. The validity, interpretation, construction and performance of this Agreement shall be governed by the internal laws of the Commonwealth of Massachusetts, without regard to conflicts of law principles. The Employee hereby irrevocably submits to and acknowledges and recognizes the jurisdiction of the courts of the Commonwealth of Massachusetts, or if appropriate, a federal court located in Massachusetts (which courts, for purposes of this Agreement, are the only courts of competent jurisdiction), over any suit, action or other proceeding arising out of, under or in connection with this Agreement or the subject matter hereof. 

 

9.4 Waiver of Right to Jury Trial. Both the Company and the Employee expressly waive any right that any party either has or may have to a jury trial of any dispute arising out of or in any way related to the matters covered by this Agreement. 

9.5 Waivers. No waiver by the Employee at any time of any breach of, or compliance with, any provision of this Agreement to be performed by the Company shall be deemed a waiver of that or any other provision at any subsequent time. 

9.6 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original but both of which together shall constitute one and the same instrument. 

9.7 Entire Agreement. Except to the extent provided herein, this Agreement, together with the offer letter and the Invention and Non-Disclosure Agreement, each to be executed by you and the Company, sets forth the entire agreement of the parties hereto in respect of the subject matter contained herein and supersedes all prior agreements, promises, covenants, arrangements, communications, representations or warranties, whether oral or written, by any officer, employee or representative of any party hereto in respect of the subject matter contained herein. 

 

 

9.8 Not an Employment Contract. The Employee acknowledges that this Agreement does not constitute a contract of employment or impose on the Company any obligation to retain the Employee as an employee and that this Agreement does not prevent the Employee from terminating employment at any time. 

9.9 Amendments. This Agreement may be amended or modified only by a written instrument executed by both the Company and the Employee, and, notwithstanding the provisions of the Change in Control Plan, the language of such Change in Control Plan may not be amended as it applies to the Employee except to the extent subject to a written instrument executed by both parties. 

9.10 Employee’s Acknowledgements. The Employee acknowledges that he: (a) has read this Agreement; (b) has been represented in the preparation, negotiation and execution of this Agreement by legal counsel of the Employee’s own choice or has voluntarily declined to seek such counsel; and (c) understands the terms and consequences of this Agreement. 

9.11 Representations Regarding Prior Work.  You represent that you have no agreement or other legal obligation with any prior employer or any other person or entity that restricts your ability to engage in employment discussion with, employment with or to perform function for, the Company.  You represent that you have been advised by the Company that at no time should you divulge to or use for the benefit of the Company, any trade secret or proprietary information of any previous employer. You acknowledge that you have not divulged or used any such information for the benefit of the Company.  You acknowledge that the Company is basing important business decision on these representations, affirm that all of the statements included herein are true and that any breach of this Section 9.11 would be considered an material breach of this Agreement. 

 

[Remainder of page intentionally left blank] 

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year set forth above. 

 

	
AVEO Pharmaceuticals, Inc. 
	
 
	
 
	
Nikhil Mehta

	
 
	
 
	
 
	
 
	
 
	
 

	
By:
	
 
	
/s/ Michael Bailey
	
 
	
 
	
/s/ Nikhil Mehta

	
 
	
 
	
 
	
 
	
 
	
 

	
Title:
	
 
	
President & CEO
	
 
	
 
	
 

 

 

 

EXHIBIT A

AVEO PHARMACEUTICALS, INC. 

KEY EMPLOYEE CHANGE IN CONTROL BENEFITS PLAN 

SECTION 1. INTRODUCTION 

The Key Employee Change in Control Benefits Plan (the “Plan”) is designed to provide separation pay and benefits to certain eligible employees of AVEO Pharmaceuticals, Inc. (“the “Company”) whose employment is involuntarily terminated without cause or voluntarily terminated for good reason as set forth in this Plan. 

SECTION 2. DEFINITIONS 

For purposes of this Plan, the following terms shall have the meanings set forth below: 

(a) “BASE SALARY” means the annual base salary for an Eligible Employee as in effect on the Change in Control Date, or as increased thereafter. 

(b) “BOARD” means the Board of Directors of the Company. 

(c) “CAUSE” means conduct involving one or more of the following: (i) the conviction of the Eligible Employee of, or, plea of guilty or nolo contendere to, any crime involving dishonesty or any felony; (ii) the willful misconduct by the Eligible Employee resulting in material harm to the Company; (iii) fraud, embezzlement, theft or dishonesty by the Eligible Employee against the Company resulting in material harm to the Company; (iv) the repeated and continuing failure of the Eligible Employee to follow the proper and lawful directions of the Company’s Chief Executive Officer or the Board after a written demand is delivered to the Eligible Employee that specifically identifies the manner in which the Chief Executive Officer or the Board believes that the Employee has failed to follow such instructions; (v) the Eligible Employee’s current alcohol or prescription drug abuse affecting work performance, or current illegal use of drugs regardless of the effect on work performance; (vi) material violation of the Company’s code of conduct by the Eligible Employee that causes harm to the Company; or (vii) the Eligible Employee’s material breach of any term of the Plan or any applicable written proprietary information, confidentiality, non-competition and/or non-solicitation agreements with the Company. 

(d) “CHANGE IN CONTROL” means the occurrence of any of the events set forth in subsections (A) or (B) below, provided that such event(s) constitute (i) a change in the ownership of the Company (as defined in Treasury Regulation Section 1.409A-3(i)(5)(v)), (ii) a change in effective control of the Company (as defined in Treasury Regulation Section 1.409A-3(i)(5)(vi)), or (iii) a change in the ownership of a substantial portion of the assets of the Company (as defined in Treasury Regulation Section 1.409A-3(i)(5)(vii)): 

(A) when a person, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, a amended) acquires beneficial ownership of the Company’s capital stock equal to 50% or more of either: (X) the then-outstanding shares of the Company’s common stock (the “Outstanding Company Common Stock”) or (Y) the combined voting power of the Company’s then-outstanding securities entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”) provided, however, that for purposes of this subsection (A), the following acquisitions of securities shall not constitute a Change in Control: (1) any acquisition of securities directly from the Company (excluding an acquisition of securities pursuant to the exercise, conversion or exchange of any security exercisable for, convertible into or exchangeable for common stock or voting securities of the Company, unless the Person exercising, 

 

 

converting or exchanging such security acquired such security directly from the Company or an underwriter or agent of the Company) or (2) any acquisition of securities by the Company; or 

(B) upon the consummation by the Company of a reorganization, merger, consolidation, statutory share exchange or a sale or other disposition of all or substantially all of the assets of the Company in one or a series of transactions (a “Business Combination”), provided that, in each case, the persons who were the Company’s beneficial owners of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination do not beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding securities entitled to vote generally in the election of directors, respectively, of the resulting or acquiring corporation in such Business Combination (which shall include, without limitation, a corporation which as a result of such transaction owns the Company or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, respectively; or 

(C) such time as the Continuing Directors (as defined below) do not constitute a majority of the Board (or, if applicable, the Board of Directors of a successor corporation to the Company), where the term “Continuing Director” means at any date a member of the Board (i) who was a member of the Board on the effective date of this Plan, or (ii) who was nominated or elected subsequent to such date by at least a majority of the directors who were Continuing Directors at the time of such nomination or election or whose election to the Board was recommended or endorsed by at least a majority of the directors who were Continuing Directors at the time of such nomination or election; provided, however, that there shall be excluded from this clause (ii) any individual whose initial assumption of office occurred as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents, by or on behalf of a person other than the Board. 

(e) “CHANGE IN CONTROL DATE” means the first date on which a Change in Control occurs. 

(f) “DISABILITY” means (i) the Eligible Employee is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months or (ii) the Eligible Employee is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company; provided that in each case, the Eligible Employee’s physical or mental impairment shall be determined by an independent qualified physician mutually acceptable to the Company and the Eligible Employee (or his personal representative) or, if the Company and the Eligible Employee (or such representative) are unable to agree on an independent qualified physician, as determined by a panel of three physicians, one designated by the Company, one designated by the Eligible Employee (or his personal representative) and one designated by the two physicians so designated. 

(g) “INVOLUNTARY TERMINATION WITHOUT CAUSE” means an Eligible Employee’s dismissal or discharge by the Company (or, if applicable, by any successor entity) for a reason other than Cause. The termination of employment will not be deemed to be an “Involuntary Termination Without Cause” if such termination occurs as a result of the Eligible Employee’s voluntary resignation without Good Reason, death or Disability. 

 

 

(i) “MANAGEMENT TEAM” shall include any executive officer, senior vice-president and vice-president of the Company and other employees of the Company nominated by the Chief Executive Officer and ratified by the Compensation Committee. 

(j) “QUALIFYING TERMINATION” means that an Eligible Employee’s employment terminates due to an Involuntary Termination Without Cause or a Voluntary Termination for Good Reason, in either case, within eighteen (18) months following a Change in Control Date. 

(k) “SECTION 16 OFFICER” means an executive officer of the Company, other than the Chief Executive Officer, Chief Financial Officer, Chief Business Officer and Chief Medical Officer, who is considered to be an “officer” of the Company within the meaning of Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended and “executive Officer” of the Company within the meaning of Rule 3b-7 under the Securities Exchange Act of 1934, as amended. 

(l) “VOLUNTARY TERMINATION FOR GOOD REASON” means any action by the Company without the Eligible Employee’s prior consent which results in he or she voluntarily terminating his or her employment with the Company (or, if applicable, with any successor entity) after any of the following are undertaken by the Company (or, if applicable, by any successor entity) without such Eligible Employee’s express consent, provided, however, that a termination for Good Reason can only occur if (i) the Eligible Employee has given the Company a written notice of termination indicating the existence of a condition giving rise to Good Reason and the Company has not cured the condition giving rise to Good Reason within thirty (30) days after receipt of such notice of termination, and (ii) such notice of termination is given within ninety (90) days after the initial occurrence of the condition giving rise to Good Reason and further provided that a termination for Good Reason shall occur no more than one hundred eighty (180) days after the initial occurrence of the condition giving rise to Good Reason: (A) any requirement by the Company that the Eligible Employee perform his or her principal duties outside a radius of 50 miles from the Company’s Cambridge, Massachusetts location, (B) any material diminution in the Eligible duties, responsibilities or authority; or (C) a material reduction in the Eligible Employee’s base salary (unless such reduction is effected in connection with a general and proportionate reduction of compensation for all employees of his or her level). 

SECTION 3. ELIGIBILITY AND PARTICIPATION 

An individual is deemed an “Eligible Employee” and, therefore, eligible to participate in the Plan if he or she is a member of the Company’s Management Team at the time of such individual’s termination of employment with the Company, and such employment terminates due to an event which constitutes a Qualifying Termination. 

SECTION 4. BENEFITS 

Eligible Employees are eligible to receive the following benefits on the following conditions: 

(a) SALARY AND BONUS PAYOUT. Commencing in the first month following the month of a Qualifying Termination and the Release set forth in Section (f) below becoming binding on the Eligible Employee, Eligible Employee will be paid in periodic installments consistent with the Company’s payroll procedures as then in effect and continuing for a number of months equal to the product of the Eligible Employee’s “Severance Multiple” (as set forth below) times twelve (12), a total sum equal to: (i) Severance Multiple times the Eligible Employee’s Base Salary; (ii) the Eligible Employee’s Severance Multiple times his/her target bonus on the date of the Qualifying Termination; and (iii) the Eligible Employee’s target bonus on the date of termination multiplied by a fraction, the numerator of which shall equal the number of days the Eligible Employee was employed by the Company during the Company fiscal year in which the termination occurs and the denominator of which shall equal 365. 

 

 

Severance Multiple shall be based on the following: 

 

	
 
	
 
	
 
	
 
	
 

	
Chief Executive Officer
	
  
	
—  
	
  
	
1.5

	
 
	
 
	
 

	
Chief Financial Officer, Chief Business Officer, Chief Medical Officer, Section 16 Officer, and any other Eligible Employee nominated by the CEO and ratified by the Compensation Committee
	
  
	
—  
	
  
	
1.0

	
 
	
 
	
 

	
Senior Vice Presidents, Vice Presidents and other Eligible Employees nominated by CEO and ratified by Compensation Committee, other than those considered Section 16 Officers 
	
  
	
—  
	
  
	
0.5

 

(b) HEALTH BENEFITS. Provided the Eligible Employee timely elects continued coverage under federal COBRA law, the Company shall pay, on the Eligible Employee’s behalf, the portion of premiums for the type of group health insurance coverage, including coverage for his or her eligible dependents, that the Company paid prior to his or her termination of employment for a period following his or her Qualifying Termination based on the Eligible Employee’s level as follows: 

 

	
 
	
 
	
 
	
 
	
 

	
Chief Executive Officer
	
  
	
—  
	
  
	
18 months

	
 
	
 
	
 

	
Chief Financial Officer, Chief Business Officer, Chief Medical Officer, Section 16 Officer, and any other Eligible Employee nominated by the CEO and ratified by the Compensation Committee
	
  
	
—  
	
  
	
12 months

	
 
	
 
	
 

	
Senior Vice Presidents, Vice Presidents and other Eligible Employees nominated by CEO and ratified by Compensation Committee, other than those considered Section 16 Officers 
	
  
	
—  
	
  
	
6 months

provided, however, that the Company will pay such premiums for the Eligible Employee and his/her eligible dependents only for coverage for which such individual and those dependents were enrolled immediately prior to the Qualifying Termination. The Eligible Employee shall continue to be required to pay that portion of the premium of such group health insurance coverage, including coverage for his/her eligible dependents that he/she had been required to pay as an active employee immediately prior to the Qualifying Termination of employment (subject to change). For the balance of the period that an Eligible Employee is eligible to receive coverage under federal COBRA law, the Eligible Employee shall be eligible to maintain coverage for himself/herself and his/her eligible dependents at the Eligible Employee’s own expense in accordance with applicable law. 

(c) EQUITY ACCELERATION. In addition to any other rights that Eligible Employees may have with respect to the acceleration of the vesting of any stock options or restricted stock awards (“Awards”) granted to such Eligible Employees pursuant to the Company’s 2002 Stock Incentive Plan, as amended (the “2002 Stock Incentive Plan”), or any successor plan, including without limitation those certain change in control related acceleration rights (upon a termination without cause) approved by the Board on December 11, 2007, and notwithstanding any provision to the contrary contained in the 2002 Stock Incentive Plan, the instrument evidencing any Award or any other agreement between an Eligible Employee and the Company, each such Award shall be immediately exercisable in full and/or free of all restrictions on repurchase, as the case may be, if the Eligible Employee’s employment with the Company or the acquiring or succeeding corporation is terminated as a result of a Qualifying Termination. 

 

 

(d) EARNED BUT UNPAID BENEFITS. As of the Qualifying Termination date an Eligible Employee will also be eligible to receive any earned but unpaid benefits including salary earned but unpaid, the annual bonus for the most recently completed financial year and payment for unused accrued vacation. 

(e) RELEASE. To receive benefits under this Plan, an Eligible Employee must execute a general release of claims in favor of the Company within thirty (30) days following the Eligible Employee’s Qualifying Termination, in a form provided by the Company at the time of the Employee’s Qualifying Termination, and such release must become effective in accordance with its terms (the “Release”). Notwithstanding the foregoing, if the 30th day following the Eligible Employee’s Qualifying Termination occurs in the calendar year following the Eligible Employee’s Qualifying Termination, then the payments and benefits will commence no earlier than January 1 of such subsequent calendar year. 

(f) TERMINATION OF BENEFITS. Benefits under this Plan shall terminate immediately if an Eligible Employee, at any time, violates any proprietary information, confidentiality, non-competition or non-solicitation obligation to the Company, or any other continuing obligation to the Company. 

(g) NON-DUPLICATION OF BENEFITS. Eligible Employees are not eligible to receive benefits under this Plan more than one time and are not eligible to receive benefits under any other Company change in control severance plan, arrangement or agreement. 

(h) TAX WITHHOLDING. Any payments that an Eligible Employee receives under this Plan shall be subject to all required tax withholding. 

(i) DISTRIBUTIONS. The following rules shall apply with respect to distribution of the payments and benefits, if any, to be provided to the Eligible Employee under this Section 4: 

(A) It is intended that each installment of the payments and benefits provided under Section 4 shall be treated as a separate “payment” for purposes of Section 409A of the U.S. Internal Revenue Code of 1986, as amended, and the guidance issued thereunder (“Section 409A”). Neither the Company nor the Eligible Employee shall have the right to accelerate or defer the delivery of any such payments or benefits except to the extent specifically permitted or required by Section 409A; 

(B) If, as of the date of the “separation from service” of the Eligible Employee from the Company, the Eligible Employee is not a “specified employee” (each within the meaning of Section 409A), then each installment of the payments and benefits shall be made on the dates and terms set forth in Section 4; and 

(C) If, as of the date of the “separation from service” of the Eligible Employee from the Company, the Eligible Employee is a “specified employee” (each, for purposes of this Agreement, within the meaning of Section 409A), then: 

(x) Each installment of the payments and benefits due under Section 4 that, in accordance with the dates and terms set forth herein, will in all circumstances, regardless of when the separation from service occurs, be paid within the Short-Term Deferral Period (as hereinafter defined) shall be treated as a short-term deferral within the meaning of Treasury Regulation Section 1.409A-1(b)(4) to the maximum extent permissible under Section 409A. For purposes of this Agreement, the “Short-Term Deferral Period” means the period ending on the later of the 15th day of the third month following the end of the Eligible Employee’s tax year in which the Eligible Employee’s separation from service occurs and the 15th day of the third month following the end of the Company’s tax year in which the Eligible Employee’s separation from service occurs; and 

 

 

(y) Each installment of the payments and benefits due under Section 4 that is not paid within the Short-Term Deferral Period and that would, absent this subsection, be paid within the six-month period following the “separation from service” of the Eligible Employee of the Company shall not be paid until the date that is six months and one day after such separation from service (or, if earlier, the death of the Eligible Employee), with any such installments that are required to be delayed being accumulated during the six-month period and paid in a lump sum on the date that is six months and one day following the Eligible Employee’s separation from service and any subsequent installments, if any, being paid in accordance with the dates and terms set forth herein; provided, however, that the preceding provisions of this sentence shall not apply to any installment of payments and benefits if and to the maximum extent that that such installment is deemed to be paid under a separation pay plan that does not provide for a deferral of compensation by reason of the application of Treasury Regulation 1.409A-1(b)(9)(iii) (relating to separation pay upon an involuntary separation from service) or Treasury Regulation 1.409A-1(b)(9)(v) (relating to reimbursements and certain other separation payments). Such payments shall bear interest at an annual rate equal to the prime rate as set forth in the Eastern edition of the Wall Street Journal on the Date of Termination, from the Date of Termination to the date of payment. Any installments that qualify for the exception under Treasury Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the last day of the second taxable year of the Eligible Employee following the taxable year of the Eligible Employee in which the separation from service occurs. 

SECTION 5. OTHER TERMINATIONS 

An otherwise Eligible Employee shall NOT be eligible to receive benefits under this Plan if (i) the Eligible Employee’s employment terminates due to death, Disability or any other reason other than a Qualifying Termination; or (ii) an Eligible Employee’s employment is terminated within thirty (30) days of his or her refusal to accept an offer of comparable employment by any successor to the Company (provided that “comparable employment” shall mean employment at a business office the location of which is not violative of Section 2(g)(i), with duties and responsibilities not violative of Section 2(g)(ii) and with a reduction in such Eligible Employee’s base salary not violative of 2(g)(iii)). 

SECTION 6. CLAIMS PROCEDURE 

Ordinarily, severance benefits will be paid to an Eligible Employee without to having to file a claim or take any action other than signing the Release as provided in Section 4(f) of this Plan and, where applicable, not revoking the Release during the applicable revocation period. If an Eligible Employee believes that he or she is entitled to severance benefits under the Plan that are not being paid, he or she may submit a written claim for payment to the Company. Any claim for benefits shall be in writing, addressed to the Company and must be sufficient to notify the Company of the benefit claimed. If such claim is denied, the Company shall within a reasonable period of time provide a written notice of denial. The notice will include the specific reasons for denial, the provisions of the Plan on which the denial is based, and the procedure for a review of the denied claim. Where appropriate, it will also include a description of any additional material or information necessary to complete or perfect the claim and an explanation of why that material or information is necessary. Eligible Employees may request in writing a review of a claim denied by the Company and may review pertinent documents and submit issues and comments in writing to the Company. The Company shall provide a written decision upon such request for review of a denied claim. The decision of the Company upon such review shall be final. 

 

 

SECTION 7. MISCELLANEOUS 

The Company reserves the right to amend or terminate this Plan at any time; provided however, that this Plan may not be amended or terminated following the Change in Control Date; and further provided that Section 4(c) of this Plan shall not be amended without the Eligible Employee’s consent unless the Board determines that the amendment, taking into account any other related action, would not materially adversely affect the Eligible Employee. This Plan shall be binding upon any surviving entity resulting from a Change in Control and upon any other person who is a successor by merger, acquisition, consolidation or otherwise to the business formerly carried on by the Company without regard to whether or not such person actively adopts or formally continues the Plan. The Plan shall be interpreted in accordance with the laws of the Commonwealth of Massachusetts. The Eligible Employee hereby irrevocably submits to and acknowledges and recognizes the jurisdiction of the courts of the Commonwealth of Massachusetts, or if appropriate, a federal court located in Massachusetts (which courts, for purposes of the Plan, are the only courts of competent jurisdiction), over any suit, action or other proceeding arising out of, under or in connection with the Plan or the subject matter hereof.SETTLEMENT
AGREEMENT AND RELEASE OF CLAIMS

 

This
Settlement Agreement and Release of Claims (the “Agreement”) is entered into as of the Effective Date by and among
Symantec Corporation (“Plaintiff”), on the one hand, and Marathon Patent Group, Inc. and Clouding Corp. (together,
“Defendants”), on the other hand.

 

RECITALS

 

WHEREAS,
Plaintiff filed case number BC640931 in the Superior Court of California for the County of Los Angeles (the “Los Angeles
Action”);

 

WHEREAS,
the original defendants in the Los Angeles Action included Defendants, as well as IP Navigation Group, LLC, Clouding IP, LLC,
William J. Carter, and Erich Spangenberg (collectively, IP Navigation Group, LLC, Clouding IP, LLC, William J. Carter, and Erich
Spangenberg are referred to herein as the “Other Defendants”);

 

WHEREAS,
the Other Defendants were dismissed from the Los Angeles Action on the basis of a forum selection agreement that purportedly required
Plaintiff to bring its claims against the Other Defendants in a Delaware court;

 

WHEREAS,
Plaintiff thereafter filed case number 17-cv-01873-GMS in the United States District Court for the District of Delaware (the “Delaware
Action”), naming IP Navigation Group, LLC and Erich Spangenberg as defendants;

 

WHEREAS,
Defendants dispute the validity of the claims asserted in the Los Angeles Action and Plaintiff disputes the defenses asserted
in the Los Angeles Action;

 

WHEREAS,
the Parties now desire to settle, compromise and conclude their disputes and to dismiss both the Los Angeles Action and the Delaware
Action in their entirety, each with prejudice;

 

NOW,
THEREFORE, the Parties agree as follows:

 

1.
Definitions. As used in this Agreement, the following terms shall have the meanings stated:

 

1.1.
The “Clouding Releasees” shall mean and include (a) Clouding Corp., including its predecessors and successors, (b)
all past, present and future parents, subsidiaries, and related and affiliated entities of Clouding Corp., and (c) Merrick D.
Okamoto, Francis Knuettel II, Douglas B. Croxall, and all other past, present and future shareholders, members, partners, co-venturers,
managers, investors, lenders, guarantors, indemnitors, assignors, assignees, directors, officers, employees, associates, attorneys,
advisors, accountants, consultants, agents and representatives of Clouding Corp. and of its parent, subsidiary, related and affiliated
entities.

 

1.2.
The “Effective Date” shall mean the date that this Agreement is fully executed by the Parties hereto, as reflected
by the last date of the signatures set forth below.

 

    	 

     

    

 

1.3.
The “Marathon Releasees” shall mean and include (a) Marathon Patent Group, Inc., including its predecessors and successors,
(b) all past, present and future parents, subsidiaries, and related and affiliated entities of Marathon Patent Group, Inc., and
(c) Merrick D. Okamoto, Francis Knuettel II, Douglas B. Croxall, and all other past, present and future shareholders, members,
partners, co-venturers, managers, investors, lenders, guarantors, indemnitors, assignors, assignees, directors, officers, employees,
associates, attorneys, advisors, accountants, consultants, agents and representatives of Marathon Patent Group, Inc., and of its
parent, subsidiary, related and affiliated entities.

 

1.4.
The “Other Defendant Releasees” shall mean and include (a) IP Navigation Group, LLC, Clouding IP, LLC (f/k/a Stec
IP, LLC), including their predecessors and successors, (b) Erich Spangenberg and William J. Carter, as well as each of their respective
trusts, trustees, heirs, beneficiaries, personal representatives, attorneys, and spouses, (c) all past, present and future parents,
subsidiaries, and related and affiliated entities of IP Navigation Group, LLC and of Clouding IP, LLC (f/k/a Stec IP, LLC), (d)
the past, present and future shareholders, members, partners, co-venturers, managers, investors, lenders, guarantors, indemnitors,
assignors, assignees, directors, officers, employees, associates, advisors, attorneys, accountants, consultants, agents and representatives
of IP Navigation Group, LLC, and of Clouding IP, LLC (f/k/a Stec IP, LLC), and of its or their parent, subsidiary, related and
affiliated entities, and (e) all other Persons who were or could have been named or identified as defendants, co-conspirators,
co-obligors or joint tortfeasors in relation to Symantec’s claims asserted in the Los Angeles Action and/or the Delaware
Action.

 

1.5.
The “Parties” shall mean Symantec Corporation, Clouding Corp., and Marathon Patent Group, Inc., collectively.

 

1.6.
“Person” shall mean an individual or entity.

 

1.7.
“Party” shall mean any of Symantec Corporation, Clouding Corp., or Marathon Patent Group, Inc.

 

1.8.
“Symantec” shall mean and include (a) Symantec Corporation, including its predecessors and successors, (b) all past,
present and future parents, subsidiaries, and related and affiliated entities of Symantec Corporation, including, but not limited
to, Symantec International, and (c) the past, present and future shareholders, members, partners, co-venturers, managers, guarantors,
indemnitors, assignors, assignees, investors, lenders, directors, officers, employees, associates, attorneys, accountants, advisors,
consultants, agents and representatives of Symantec Corporation and of its parent, subsidiary, related and affiliated entities.

 

2.
No admission of liability. This Agreement is entered into for purposes of settlement and compromise only, and each Party
hereby expressly acknowledges and agrees that the other Parties hereto have not admitted, and by execution and performance of
this Agreement do not admit, any liability or obligation to any of the other Parties, except for the obligations created by this
Agreement. Nothing contained in this Agreement shall be construed as such an admission by any Party, and this Agreement, its terms,
and the negotiations preceding it, are entitled to all applicable evidentiary privileges and protections concerning settlement
discussions and of offers of compromise including, but not limited to, the protections of California Evidence Code § 1152
and Rule 408 of the Federal Rules of Evidence.

 

    	-2-

     

    

 

3.
Release of claims by Symantec against the Marathon Releasees and the Clouding Releasees. In exchange for the consideration
described herein, Symantec, on behalf of itself and any other Person that might claim by, through or on behalf of it, knowingly,
voluntarily, fully, finally, irrevocably and forever releases and discharges the Marathon Releasees and the Clouding Releasees
from any and all claims, counterclaims, crossclaims, grievances, disputes, controversies, violations, losses, debts, charges,
causes of action, requests for relief, suits, demands, judgments, costs, and liabilities of every nature, kind, character or description
whatsoever, both legal and equitable, known or unknown, foreseen or unforeseen, suspected or unsuspected, vested or unvested,
absolute or contingent, that Symantec held, holds or may hold against the Marathon Releasees and/or the Clouding Releasees, or
any of them, at any time from the beginning of time through the Effective Date of this Agreement, all claims or causes of action
based upon, related to, or arising from the allegations that were made, or could have been made, with respect to the subject matter
of the pleadings filed in the Los Angeles Action and the Delaware Action, including, without limitation, any and all claims or
rights to receive any payments or other consideration pursuant to the Patent Purchase Agreement between Symantec Corporation,
Symantec International and Stec IP, LLC dated February 28, 2012, the Amended and Restated Patent Purchase Agreement between Symantec
Corporation, Symantec International, and Clouding IP, LLC (f/k/a Stec IP, LLC) dated August 11, 2014, or the Patent Purchase Agreement
between Marathon Patent Group, Inc., Clouding Corp. and Clouding IP, LLC (f/k/a Stec IP, LLC) dated August 29, 2014. Symantec
represents that it is presently unaware of any facts that cause it to believe that it may hold a valid legal claim or cause of
action against any of the Marathon Releasees or the Clouding Releasees other than those claims or causes of action that it asserted
in the pleadings filed in the Los Angeles Action and, in addition to the dismissal with prejudice of the Los Angeles Action and
the Delaware Action, Symantec covenants not to bring, prosecute or join in any suit or legal action against the Marathon Releasees
and Clouding Releasees, or any of them, based on any of the claims or causes of action encompassed by this release.

 

4.
Release of claims by Symantec against the Other Defendant Releasees. In exchange for the consideration described herein,
Symantec, on behalf of itself and any other Person that might claim by, through or on behalf of it, knowingly, voluntarily, fully,
finally, irrevocably and forever releases and discharges the Other Defendant Releasees from any and all claims, counterclaims,
crossclaims, grievances, disputes, controversies, violations, losses, debts, charges, causes of action, requests for relief, suits,
demands, judgments, costs, and liabilities of every nature, kind, character or description whatsoever, both legal and equitable,
known or unknown, foreseen or unforeseen, suspected or unsuspected, vested or unvested, absolute or contingent, that Symantec
held, holds or may hold against the Other Defendant Releasees, or any of them, at any time from the beginning of time through
the Effective Date of this Agreement, all claims or causes of action based upon, related to, or arising from the allegations that
were made, or could have been made, with respect to the subject matter of the pleadings filed in the Los Angeles Action and the
Delaware Action, including, without limitation, any and all claims or rights to receive any payments or other consideration pursuant
to the Patent Purchase Agreement between Symantec Corporation, Symantec International and Stec IP, LLC dated February 28, 2012,
the Amended and Restated Patent Purchase Agreement between Symantec Corporation, Symantec International, and Clouding IP, LLC
(f/k/a Stec IP, LLC) dated August 11, 2014. Symantec represents that it is presently unaware of any facts that cause it to believe
that it may hold a valid legal claim or cause of action against any of the Other Defendant Releasees other than those claims or
causes of action that it asserted in the pleadings filed in the Los Angeles Action and/or the Delaware Action and, in addition
to the dismissal with prejudice of the Los Angeles Action and the Delaware Action, Symantec covenants not to bring, prosecute
or join in any suit or legal action against the Other Defendant Releasees, or any of them, based on any of the claims or causes
of action encompassed by this release. For sake of clarity, nothing in this Agreement is intended to or shall have the effect
of releasing or discharging any claims or causes of action that any of the Marathon Releasees or the Clouding Releasees might
possess against any of the Other Defendant Releasees including, without limitation, claims for contribution or indemnity.

 

    	-3-

     

    

 

5.
Application of releases to unknown claims; Civil Code section 1542. Except as expressly provided herein, Symantec understands
and intends that the claims, charges and causes of action released in Sections 3 and 4 herein include all legal, contractual,
statutory and equitable claims, charges and causes of action held by it against the Marathon Releasees, the Clouding Releasees,
and the Other Defendant Releasees, regardless of whether those claims, charges and causes of action are presently known or anticipated.
Symantec hereby waives all rights to which it may be entitled pursuant to California Civil Code section 1542 and all other rules
and laws of similar purpose or effect. California Civil Code section 1542 provides as follows:

 

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

 

6.
Payment by Marathon. Within fifteen (15) days of the Effective Date, Marathon Patent Group, Inc. shall pay the sum of ____________
to Symantec Corporation (the “Cash Consideration”). Such payment shall be made by electronic funds transfer using
the below instructions:

 

	PREMIER
    BUSINESS BANK
	INSTRUCTIONS
    FOR INCOMING WIRES (US ONLY)
	 	 
	ABA/ROUTING	122044371
	 	 
	RECEIVER
    BANK:	PREMIER
    BUSINESS BANK
	 	700
    S. FLOWER STREET, SUITE 2000
	 	LOS
    ANGELES, CA 90017
	 	 
	BENEFICIARY
    ACCT#	
	 	 
	BENEFICIARY
    NAME:	LTL
    ATTORNEYS LLP - CLIENT TRUST ACCOUNT
	 	300
    S. Grand Avenue, 14th Floor
	 	Los
    Angeles, CA 90071

 

    	-4-

     

    

 

With
its payment, Marathon Patent Group, Inc. shall include the following notation: “Symantec-Marathon Patent Group Legal Settlement.”

 

7.
Dismissal of claims. Within five (5) court days of payment of the Cash Consideration described above, Symantec shall cause
the dismissal with prejudice the entirety of the Los Angeles Action and of the Delaware Action, and any and all claims, actions,
proceedings, lawsuits, and causes of action Symantec has filed against any of the Marathon Releasees, the Clouding Releasees,
and/or any of the Other Defendant Releasees. The Cash Consideration shall be held in, and may not be transferred or disbursed
from, the LTL Attorneys LLP Client Trust Account until Defendants’ counsel acknowledges receipt of written notice evidencing
(e.g., via conformed copies of orders and/or true copies of docket reports reflecting) entry by the relevant courts of the dismissal
with prejudice of the Los Angeles Action and of the Delaware Action, in their entirety, such acknowledgement not to be unreasonably
withheld.

 

8.
Covenant not to sue for patent infringement. In exchange for the consideration described herein, Marathon Patent Group,
Inc., on behalf of itself and its Affiliates, covenants that Marathon Patent Group, Inc. and its Affiliates will not initiate
or continue any judicial or administrative proceeding (e.g., before the U.S. International Trade Commission) anywhere in
the world against Symantec Corporation, its Affiliates, or any of its or their Suppliers, Distributors or Customers, based upon
any claim that the manufacture, use, sale, license, distribution, offer for sale, offer for license, import, export, or other
exploitation of a Symantec Product constitutes infringement (including direct, contributory or inducement of infringement) of
any patent. This covenant is irrevocable and non-terminable.

 

8.1.
Solely for purposes of this provision, “Affiliate” means, with respect to a Party, any Person that directly or indirectly,
as of the Effective Date or at any time thereafter, Controls, is Controlled by, or is under common Control with, such Party. For
purposes of this provision, “Control” shall mean: (a) ownership or control, directly or indirectly, presently held
or acquired in the future, of (1) fifty percent (50%) or more of the outstanding voting shares of such an entity, (2) fifty percent
(50%) or more of the total combined voting power entitled to elect or appoint directors or persons performing similar functions
for such an entity; (b) in the case of a non-corporate entity, the interest in such non-corporate entity giving the power to direct
or cause the direction of the management or policies of such non-corporate entity; (c) the right under contract or other arrangement
to direct or cause the direction of the management or policies of such entity; or (d) the right to share, directly or indirectly,
in the proceeds or recovery from any claim against Symantec Corporation, its Affiliates, or any of its or their Suppliers, Distributors
or Customers, that the manufacture, use, sale, license, distribution, offer for sale, offer for license, import, export, or other
exploitation of a Symantec Product constitutes infringement (including direct, contributory or inducement of infringement) of
any patent. A Person’s status as an Affiliate shall terminate when such Control no longer exists.

 

    	-5-

     

    

 

8.2.
For purposes of this provision, “Customer” means a Person that uses, purchases, or acquires a license to use, a Symantec
Product.

 

8.3.
For purposes of this provision, “Distributor” means a Person that sells, offers for sale, licenses, offers for license
or distributes a Symantec Product.

 

8.4.
For purposes of this provision, “Supplier” means a Person that makes or supplies a Symantec Product.

 

8.5.
For purposes of this provision, “Symantec Product” means any product, portion of a product, service, portion of a
service, or combination with one or more other products, portions of a product, services, or portions of a service made, used,
sold, distributed, licensed or offered for sale or license by or for Symantec Corporation or any Symantec Affiliate now or in
the future.

 

9.
Due consideration of Agreement. Each of the Parties represents and agrees that:

 

	 	(a)
    	it
    has had the opportunity to consider this Agreement for a reasonable time before signing it; 
	 	 	 
	 	(b)
    	it
    has had a reasonable opportunity to consult an attorney before signing this Agreement;
	 	 	 
	 	(c)
    	it
    has read this Agreement in full and understands all of the terms and conditions set forth herein; and
	 	 	 
	 	(d)
    	it
    knowingly and voluntarily agrees to all of the terms and conditions set forth herein and intends to be legally bound by them.
    

 

10.
Confidentiality of Agreement. All information provided pursuant to this Agreement, including without limitation, the facts
and circumstances underlying the dispute, the terms of this Agreement, and the negotiations leading to this Agreement shall be
regarded as confidential information (“Confidential Information”). The Parties agree that, other than as required
by law or expressly permitted by this Agreement, they shall not disclose any Confidential Information to any third party and shall
use the Confidential Information only for the purposes set forth herein. Either Party may disclose the terms and existence of
this Agreement to its accountants, attorneys, bankers, investors, prospective investors, and the Other Defendant Releasees provided
above (collectively, the “Permitted Third Parties”) as reasonably necessary, provided that any such Permitted Third
Party is bound to confidentiality obligations that are at least as restrictive as the terms of this confidentiality provision
in this Agreement. Either Party may disclose the terms and existence of this Agreement in response to any valid subpoena or request
from a governmental authority, so long as such disclosure is subject to the most restrictive confidentiality provisions reasonably
available under the circumstances. Notwithstanding the confidentiality obligations in this Agreement, each Party acknowledges
and agrees that the other Party may comply with its securities disclosure obligations by referencing or disclosing only those
portions of this Agreement as required to be filed with the Securities and Exchange Commission, or any other filings, reports
or disclosures that may be required under applicable laws and regulations (each such disclosure as to this Agreement or any of
its Exhibits, a “Securities Disclosure”). In making a Securities Disclosure, each Party agrees to act in good
faith to maintain the confidentiality of this Agreement and all of its contents to the greatest extent reasonably possible, consistent
with all legal and regulatory obligations.

 

    	-6-

     

    

 

11.
Binding upon successors and assignees. The Parties agree that this Agreement shall be binding upon their successors and
assignees. Each represents that it has not transferred to any person or entity any of the rights released or transferred through
this Agreement. The Other Defendant Releasees are intended third party beneficiaries of this Agreement and no provision of this
Agreement may be amended or altered in any way that adversely impacts the rights or benefits provided hereunder with respect to
the Other Defendant Releasees.

 

12.
Severability. If a court of competent jurisdiction declares or determines that any provision of this Agreement is invalid,
illegal or unenforceable, (a) the invalid, illegal or unenforceable provision(s) shall be stricken from the Agreement, (b) the
Agreement shall be reformed to effectuate the stricken provision(s) as closely as the law permits, and (c) the remaining provisions
of the Agreement shall continue in full force and effect.

 

13.
Enforcement of Agreement. California Code of Civil Procedure section 664.6 provides as follows:

 

If
parties to pending litigation stipulate, in a writing signed by the parties outside the presence of the court or orally before
the court, for settlement of the case, or part thereof, the court, upon motion, may enter judgment pursuant to the terms of the
settlement. If requested by the parties, the court may retain jurisdiction over the parties to enforce the settlement until performance
in full of the terms of the settlement.

 

Pursuant
to California Code of Civil Procedure section 664.6, the Parties stipulate, by executing this agreement, that the court may retain
jurisdiction over the Parties to enforce the terms of the settlement.

 

14.
Remedies upon breach. Each Party, upon breach of this Agreement by another, shall have the right to seek all necessary
and proper relief, including, but not limited to, specific performance, from a court of competent jurisdiction, provided, however,
that the Parties shall first attempt to resolve any dispute between them through mediation before the Honorable Carla Woehrle
(retired) or, upon her unavailability, another neutral mediator. The Party or Parties prevailing in any suit for breach of this
Agreement shall be entitled to recover reasonable costs and attorney fees.

 

15.
Governing law. The laws of the State of California shall govern the construction and enforcement of this Agreement, provided
that the Agreement shall be interpreted as though drafted jointly by the Parties. Any legal proceeding arising from, based upon
or relating to this Agreement shall be filed in the Superior Court of the State of California, County of Los Angeles, and the
Parties each agree that such court shall have personal jurisdiction over them in any such proceeding.

 

16.
Costs and attorney fees. Each Party shall bear its own attorney fees and costs in connection with this Agreement, the Los
Angeles Action, and the Delaware Action. No Party shall be entitled to recover attorney fees or costs or any other money from
another except as provided herein.

 

    	-7-

     

    

 

17.
Entire Agreement; modification. This Agreement sets forth the entire agreement between the Parties regarding the subject
matter and supersedes all prior agreements or understandings, both written and oral, between the Parties regarding the subject
matter of this Agreement. The Parties may modify this Agreement only through a writing signed by each.

 

18.
Counterparts. The Parties may execute this Agreement in counterparts which, taken together, shall constitute one and the
same Agreement, and a signature transmitted by facsimile or other electronic means shall be deemed the equivalent of an original
signature.

 

19.
Further assurances. The Parties agree to perform such actions, and to execute such additional documents, if any, as may
be necessary or appropriate to effectuate the intent of this Agreement.

 

20.
No reliance on representations by other Party or other Party’s representatives. Other than as stated in this Agreement,
the Parties agree and represent that they have not relied and do not rely upon any representation or statement regarding the subject
matter or effect of this Agreement made by any other Party to this Agreement or any other Party’s agents, attorneys or representatives.

 

21.
Construction. The captions and headings used in this Agreement are for convenience of reference only and are not to be
considered in construing the Agreement. Unless the context of the Agreement clearly requires otherwise, as used herein: (a) references
to the plural include the singular, the singular the plural, and the part the whole; (b) references to one gender include all
genders; (c) “and” and “or” each have the inclusive meaning frequently identified with the phrase “and/or”;
(d) “including” has the inclusive meaning frequently identified with the phrase “including but not limited to”
or “including without limitation”; and (e) any reference to a statute, rule, regulation or agreement, including this
Agreement, shall be deemed to include such statute, rule, regulation or agreement as it may be modified, varied, amended or supplemented
from time to time.

 

22.
No assignment of claims. All Parties represent and warrant that they have not assigned any claims to any third party.

 

23.
Authority to enter into Agreement. Each Party represents and warrants to the other Parties that it has the power and authority
to enter into, execute, deliver and perform this Agreement.

 

    	-8-

     

    

 

IN
WITNESS WHEREOF, the Parties have executed this Settlement Agreement and Release of Claims as of the Effective Date.

 

	 	 	 	Symantec
    Corporation
	 	 	 	 
	Date:	March
    8, 2018	By:	/s/
    Carrie Flynn
	 	 	 	Carrie
        Flynn

        Senior
        Director, Legal

 

	 	 	 	Clouding
    Corp.
	 	 	 	 
	Date:	March
    8, 2018	By:	/s/
    Francis Knuettel II
	 	 	 	Francis
    Knuettel II, CFO

 

	 	 	 	Marathon
    Patent Group, Inc.
	 	 	 	 
	Date:
    	March
    8, 2018	By:	/s/
Merrick Okamoto
	 	 	 	Merrick
    Okamoto, Interim CEO and Executive Chairman

 

    	-9-

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