Document:

Exhibit 10.8

 

SUBLICENSE AGREEMENT

This Sublicense Agreement (“Agreement”) is made and entered into as of the ____ day of ___, 2013 (the “Effective Date”), by and between BioTime, Inc., a California corporation (“BioTime”), and BioTime Acquisition Corporation, a Delaware corporation (“BAC”).  BioTime and BAC are sometimes hereinafter referred to as the “Parties”.

WITNESSETH

WHEREAS, BioTime owns an inventory of certain proprietary human embryonic stem cell lines (“ESI Lines”) developed by its subsidiary ES Cell International Pte Ltd (“ESI”); and

WHEREAS, BioTime has agreed to provide to BAC, a quantity of ESI Lines under an Asset Contribution Agreement, dated January 4, 2013, subject to BAC agreeing to the terms and conditions set forth in this Agreement;

WHEREAS, ESI has licensed to BioTime the right to use certain patents, with the right to grant sublicenses;

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, the Parties hereto agree as follows:

ARTICLE 1 ‐ DEFINITIONS

1.1            “AFFILIATE” means any corporation (other than BioTime), limited liability company, limited partnership or other entity in control of, controlled by, or under common control with BAC.

1.2            “CONFIDENTIAL INFORMATION” means confidential or proprietary information of ESI or BioTime relating to the ESI LINES and PATENT RIGHTS.  CONFIDENTIAL INFORMATION may be in written, graphic, oral or physical form and may include scientific knowledge, know-how, processes, inventions, techniques, formulae, specifications, reports, studies, findings, data, plans or other records, and/or biological materials. CONFIDENTIAL INFORMATION shall not include:  (a) information which is, or later becomes, generally available to the public through no fault of BAC or any SUBSIDIARY; (b) information which is provided to BAC or a SUBSIDIARY by an independent third party having no obligation to keep the information secret; and (c) information which BAC or a SUBSIDIARY can establish by written documentation was independently developed by it without reference to the CONFIDENTIAL INFORMATION.

1.3            “PATENT RIGHTS” means the patents and patent applications identified on Exhibit A attached hereto, and any divisional, continuation or continuation-in-part of those applications, but only to the extent the claims in said applications are directed to subject matter specifically described in the patents and patent applications identified on Exhibit A, as well as any patents issued on these patent applications, and any reissues, reexaminations, extensions and substitutions (or the equivalent) thereof and any foreign counterparts to those patents and patent applications.  The parties agree that Exhibit A may be revised from time to time after the EFFECTIVE DATE to reflect changes thereto.

1.4            “SUBSIDIARY” means any corporation, limited liability company, limited partnership or other entity controlled by BAC through equity ownership or voting power as a holder of capital stock, voting debt instruments, or other securities or under any contract or agreement.

For purposes of this Agreement, except as otherwise expressly provided herein or unless the context otherwise requires:  (a) the use herein of the plural shall include the single and vice versa and the use of the masculine shall include the feminine; (b) unless otherwise set forth herein, the use of the term “including” or “includes” means “including [includes] but [is] not limited to”; and (c) the words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular provision.  Additional terms may be defined throughout this Agreement.

ARTICLE 2 - LICENSE GRANT; USE; RESTRICTIONS

2.1            Grant of Rights;Use.  BioTime hereby grants to BAC, and BAC accepts, subject to the terms and conditions of this Agreement, a royalty-free, non-exclusive, world-wide right to use the ESI LINES and sublicense to use PATENT RIGHTS for any and all uses other than resale of ESI LINES or transfer of ESI LINES to third parties without consideration, or sublicensing PATENT RIGHTS to third parties other than SUBSIDIARIES.

2.2            Transfers/Sublicensing.  BAC shall not transfer, grant sublicenses of its rights or assign, in whole or in part, any of its rights under Section 2.1 without the prior written consent and approval of BioTime, which consent may be granted or withheld in BioTime’s sole discretion, , except that BioTime’s consent shall not be required for the following:  (a) a transfer, assignment and/or sublicense to a SUBSIDIARY; (b) a transfer of materials and/or sublicense from BAC or a SUBSIDIARY to enable the transferee/sublicense to engage in a project of collaborative research with BAC or a SUBSIDIARY using ESI LINES or PATENT RIGHTS for the development of new products; (c) a transfer of materials and/or sublicense from BAC or a SUBSIDIARY to enable the transferee/sublicensee to perform specific services in support of the sale or distribution of new products (e.g. testing, contract manufacturing, distribution) made or derived from ESI LINES or using PATENT RIGHTS, or (d) a transfer of materials and/or sublicense from BAC or a SUBSIDIARY to use ESI LINES and/or PATENT RIGHTS to manufacture, market, distribute, and sell new products, or to perform other activities necessary for the commercialization of new products, made or derived from ESI LINES and/or using PATENT RIGHTS.

2.3            Third Party Patents.  BAC acknowledges that, depending on the nature of the products developed or to be developed, made, sold, and licensed from the ESI LINES, additional licenses from third parties, including without limitation Wisconsin Alumni Research Foundation (WARF) or WiCell Research Institute, may be required.  BioTime shall have no obligation to obtain for or otherwise provide, by sublicense or otherwise, any license or sublicense to use any patents, technology, know-how or other intellectual property belonging to BioTime, any BioTime Affiliate (other than BAC and SUBSIDIARIES), or any third party.

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2.4            Legal Compliance.  BAC is solely responsible for the management and use of the ESI Lines supplied hereunder, including without limitation the storage, use, and disposal of the ESI Lines.  BAC acknowledges that the use of the ESI Lines is subject to federal, state and local statutes, rules, regulations and guidelines, which, without limiting the generality of the foregoing, may restrict or prohibit (i) the introduction of stem cells from a covered stem cell line into nonhuman primate embryos; (ii) the introduction of any stem cells, whether human or nonhuman, into human embryos; and (iii) breeding any animal into which stem cells from a covered stem cell line have been introduced.  BAC also acknowledges that the ESI Lines have not been approved by the United States Food and Drug Administration or any comparable foreign government agency for any therapeutic or diagnostic use.  If any governmental regulatory body requires any permits, licenses or approvals in connection with the use of the ESI Lines by BAC or any SUBSIDIARY or sublicensee, BAC or such SUBSIDIARY or sublicensee shall be responsible for obtaining the same at its or their expense.

ARTICLE 3 - PATENT RIGHTS

3.1            Prosecution of Patents and Claims,  BAC will cooperate with BioTime and ESI to prosecute such patents and claims under patent applications or other PATENT RIGHTS as BioTime or ESI may reasonably request.

3.2            Infringement of PATENT RIGHTS.  The Parties agree to notify each other in writing of any third-party claim of invalidity or unenforceability of the PATENT RIGHTS, or of any interference or other proceeding affecting the PATENT RIGHTS.

3.3            New Patents, Inventions, and Discoveries.  BAC shall have the right to file and prosecute new patent applications (and to obtain new patents) covering any new products developed by BAC using ESI LINES, or derived from ESI LINES, and any other subject matter, based on any technology, invention, or discovery made by BAC or any of its SUBSIDIARIES or any sublicensees using PATENT RIGHTS; provided, that (a) BAC and its SUBSIDIARIES and sublicensees shall use ESI LINES and only for the purpose of developing new products from ESI LINES, and (b) BAC shall, and shall cause its Subsidiaries to, license to BioTime, on a royalty-free basis, the right to use such new patents for any and all purposes in any country, except for use in producing, manufacturing, distributing, or selling and product developed by BAC or any SUBSIDIARY.

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ARTICLE 4– INDEMNIFICATION

LIMITATION OF LIABILITY AND INSURANCE

4.1            BAC shall at all times during the term of this Agreement and thereafter, indemnify, defend and hold harmless BioTime, ESI, and the respective successors, assigns, agents, officers, directors, shareholders and employees of BioTime and ESI (each, an “Indemnified Party”), at BAC’s sole cost and expense, against all liabilities of any kind whatsoever, including legal expenses and reasonable attorneys’ fees, arising out of the death of or injury to any person or persons or out of any damage to property resulting from the development, production, manufacture, use, sale, distribution, lease, license, transfer, consumption or advertisement of any product, process, or service by BAC, any SUBSIDIARY, or by any licensee or contractor of BAC, that includes or was derived or produced from ESI LINES or using PATENT RIGHTS, or arising from any obligation, act or omission, or from a breach of any representation or warranty of BAC under this Agreement, excepting only claims of that result from the willful misconduct of, or knowing violation of law by an Indemnified Party.  The indemnification obligations set forth herein are subject to the following conditions: (i) the Indemnified Party shall notify BAC in writing promptly upon learning of any claim or suit for which indemnification is sought; (ii) BAC shall have control of the defense or settlement, provided that the Indemnified Party shall have the right (but not the obligation) to participate in such defense or settlement with counsel at its selection and at (x) its sole expense if BAC is conducting the defense of the claim, (y) BAC’s expense if BAC has not commenced or is not continuing the defense of the claim, or (z) BAC’s expense if the defense of BAC and the Indemnified Party by the same counsel would give rise to any conflict of interest or if the Indemnified Party has defenses that are in addition to or different than those available to BAC; and (iii) the Indemnified Party shall reasonably cooperate with the defense, at BAC’s expense.

4.2            EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, BIOTIME, ESI, AND THEIR RESPECTIVE DIRECTORS, OFFICERS, AGENTS, SHAREHOLDERS, EMPLOYEES, AND AFFILIATES (OTHER THAN BAC) MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF PATENT RIGHTS CLAIMS, ISSUED OR PENDING, AND THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, AND ANY AND ALL SUCH WARRANTIES ARE EXPRESSLY DISCLAIMED.  NOTHING IN THIS AGREEMENT SHALL BE CONSTRUED AS A REPRESENTATION MADE OR WARRANTY GIVEN BY BIOTIME OR ESI THAT THE USE OR PRACTICE BY BAC OF THE LICENSE GRANTED HEREUNDER SHALL NOT INFRINGE THE PATENT RIGHTS OF ANY THIRD PARTY. IN NO EVENT SHALL BIOTIME, ESI, OR ANY OF THEIR RESPECTIVE DIRECTORS, OFFICERS, AGENTS, SHAREHOLDERS, EMPLOYEES AND AFFILIATES (OTHER THAN BAC) BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ECONOMIC DAMAGE OR INJURY TO PROPERTY AND LOST PROFITS, REGARDLESS OF WHETHER BIOTIME SHALL BE ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY OF SUCH DAMAGES.

4.3            BAC agrees to maintain insurance or self-insurance that is reasonably adequate to fulfill any potential obligation to the indemnified parties.  BAC shall continue to maintain such insurance or self-insurance during the term of this Agreement and after the expiration or termination of this Agreement for a period of five (5) years.

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ARTICLE 5– TERMINATION

5.1            This Agreement shall be effective on the Effective Date and shall terminate upon the termination of the ESI License Agreement, unless sooner terminated as provided in this Article 8.

5.2            BioTime may terminate this Agreement and the rights, privileges and license granted hereunder by written notice upon a breach or default of this Agreement by BAC if the breach or default is not cured within thirty (30) days after a written request to remedy such breach, or if the breach or default cannot be cured within said thirty (30) day period, failure of BAC within said thirty (30) day period to proceed with reasonable promptness thereafter to cure the breach, provided that a cure is fully implemented with one hundred twenty (120) days after occurrence.  Such termination shall become automatically effective unless BAC shall have cured any such material breach or default prior to the expiration of the applicable cure period.

5.3            BAC shall have the right to terminate this Agreement at any time on three (3) months’ prior notice to BioTime.

5.4            Upon termination of this Agreement, BAC shall cease all uses of every and any kind of ESI LINES and PATENT RIGHTS.

5.5            Upon termination of this Agreement for any reason, nothing herein shall be construed to release either party from any obligation that matured prior to the effective date of such termination; and Article 4 and Article 6, and any other Sections or provisions which by their nature are intended to survive termination, shall survive any such termination.

ARTICLE 6 - CONFIDENTIALITY

6.1            During the course of this Agreement, BioTime may provide BAC with CONFIDENTIAL INFORMATION belonging to BioTime or ESI.  CONFIDENTIAL INFORMATION may be disclosed in oral, visual or written form, and includes such information that is designated in writing as such at the time of disclosure, orally disclosed information that is designated in writing as confidential within 30 days after such oral disclosure, or information which, under all of the given circumstances ought reasonably be treated as CONFIDENTIAL INFORMATION. BAC shall exercise reasonable care to protect the CONFIDENTIAL INFORMATION disclosed to BAC by BioTime or ESI from disclosure to third parties and no such disclosure shall be made without the written permission of BioTime or ESI.  Upon termination or expiration of this Agreement, BAC shall comply with BioTime’s written request to return to BioTime all CONFIDENTIAL INFORMATION that is in written or tangible form.  Except as expressly provided herein, BAC is not being granted any license to use BioTime’s or ESI’s CONFIDENTIAL INFORMATION.  The obligations of BAC under this Article 6 shall survive any expiration or termination of this Agreement.  Notwithstanding the preceding provisions of this Section 6.1, until such time as this Agreement is terminated:  BAC shall have the right to disclose CONFIDENTIAL INFORMATION and the content of patent applications related to or included in PATENT RIGHTS to third parties in connection the licensing or sale of products developed by BAC using or derived from ESI Lines or using PATENT RIGHTS, but only to the extent that such disclosure is necessary for the use of the product, and provided, that the third parties agree in writing to keep such information confidential on the same basis as BAC agrees to maintain CONFIDENTIAL INFORMATION confidential under this Agreement.

6.2            The parties agree that the specific terms (but not the overall existence) of this Agreement shall be considered CONFIDENTIAL INFORMATION; provided, however, that the parties may disclose the terms of this Agreement to investors or potential investors, potential business partners, potential sublicensees and assignees, potential co-developers, manufacturers, marketers, or distributors of products and processes, and in any prospectus, offering, memorandum, or other document or filing required by applicable securities laws or other applicable law or regulation.  The parties may also disclose CONFIDENTIAL INFORMATION that is required to be disclosed to comply with applicable law or court order, provided that the recipient gives reasonable prior written notice of the required disclosure to the discloser and reasonably cooperates with the discloser’s efforts to prevent such disclosure.

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ARTICLE 7 - NOTICES AND OTHER COMMUNICATIONS

7.1            Any notice or other communication required to be given to any party will be deemed to have been properly given and to be effective (a) on the date of delivery if delivered by hand, air courier delivery service, confirmed facsimile transmission, or confirmed electronic mail, or (b) four days after being deposited in the United States Mail, certified first class postage prepaid, in each case if sent to the respective addresses, FAX number or email address given below, or to another address as it shall designate by written notice given to the other party in the manner provided in this Section.

		In the case of BAC:	
BioTime Acquisition Corporation

301 Harbor Bay Parkway, Suite 100

Alameda, California 94502

FAX:  (510) 521-3389

Attention:  Thomas Okarma, Chief Executive Officer

	 	In the case of BioTime     	

 BioTime, Inc.

301 Harbor Bay Parkway, Suite 100

Alameda, California 94502

FAX:  (510) 521-3389

Attention:  Michael D. West, President

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ARTICLE 8- REPRESENTATIONS AND WARRANTIES

8.1            BAC represents and warrants that it has full corporate power and authority to enter into this Agreement, that this Agreement constitutes the binding legal obligation of BAC, enforceable in accordance with its terms, and that the execution and performance of this Agreement by BAC will not violate, contravene or conflict with any other agreement to which BAC is a party or by which it is bound or with any law, rule or regulation applicable to BAC, and that any permits, consents or approvals necessary or appropriate for BAC to enter into this Agreement have been obtained.

8.2            BAC is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted.

8.3            BAC represents and warrants that (a) it has the full legal right and power to enter into this Agreement and to grant the sublicenses granted hereunder, and (b) that this Agreement constitutes the binding legal obligation of BAC, enforceable in accordance with its terms.

8.4            BioTime represents and warrants that it has full corporate power and authority to enter into this Agreement, that this Agreement constitutes the binding legal obligation of BioTime, enforceable in accordance with its terms, and that the execution and performance of this Agreement by BioTime will not violate, contravene or conflict with any other agreement to which BioTime is a party or by which it is bound or with any law, rule or regulation applicable to BioTime, and that any permits, consents or approvals necessary or appropriate for BioTime to enter into this Agreement have been obtained.

8.5            BioTime is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted.

8.6            BioTime represents and warrants that (a) it has the full legal right and power to enter into this Agreement and to grant the sublicenses granted hereunder, and (b) that this Agreement constitutes the binding legal obligation of BioTime, enforceable in accordance with its terms.

ARTICLE 9‐ MISCELLANEOUS PROVISIONS

9.1            Nothing herein shall be deemed to constitute either party as the agent or representative of the other party.

9.2            To the extent commercially feasible, and consistent with prevailing business practices, all products manufactured or sold under this Agreement will be marked with the number of each issued patent that applies to such product.

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9.3            This Agreement shall be construed, governed, interpreted and applied in accordance with the laws of the state of California, without regard to principles of conflicts of law thereof, except that questions affecting the construction and effect of any patent shall be determined by the law of the country in which the patent was granted.

9.4            The parties hereto acknowledge that this Agreement (including the Exhibits hereto) sets forth the entire Agreement and understanding of the parties hereto as to the subject matter hereof, and shall not be subject to any change or modification except by the execution of a written instrument subscribed to by the parties hereto.

9.5            The provisions of this Agreement are severable, and in the event that any provisions of this Agreement shall be determined to be invalid or unenforceable under any controlling body of the law, such invalidity or unenforceability shall not in any way affect the validity or enforceability of the remaining provisions hereof.

9.6            The failure of either party to assert a right hereunder or to insist upon compliance with any term or condition of this Agreement shall not constitute a waiver of that right or excuse a similar subsequent failure to perform any such term or condition by the other party.

9.7            The parties agree that the sublicenses granted to BAC to use PATENT RIGHTS constitute licenses of “intellectual property” as defined in the United States Bankruptcy Code (the “Bankruptcy Code”) and as used in Section 365(n) of the Bankruptcy Code.

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the Effective Date set forth above.

 

	
BIOTIME ACQUISITION CORPORATION

	
 

	
 

	
 

	
 

	
By: 

	
 

	
 

	
Thomas Okarma, Chief Executive Officer

	
 

	
 

	
 

	
 

	
By: 

	
 

	
 

	
Judith Segall, Secretary

	
 

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BIOTIME, INC.

	
 

	
 

	
 

	
 

	
By: 

	
 

	
 

	
Michael D. West, Chief Executive Officer

	
 

	
 

	
 

	
 

	
By: 

	
 

	
 

	
Judith Segall, Secretary

	
 

 

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EXHIBIT A

LICENSED PATENTS

Methods of regulating differentiation in stem cells

Pebay et al, US Patent number 7,604,990

  

Methods of regulating differentiation in stem cells

Pebay et al, US Patent number 7,413,903

 

10Exhibit 10.9

 

INCENTIVE STOCK OPTION AGREEMENT

 

THIS AGREEMENT made and entered into as of _______, 20__, by and between Asterias Biotherapeutics, Inc., a Delaware corporation (the “Company”), and __________, an employee (the “Employee”) of the Company.

 

W I T N E S S E T H

 

WHEREAS, the Company has adopted the Asterias Biotherapeutics, Inc. 2013 Equity Incentive Plan (the “Plan”), administered by the Company’s Board of Directors (the “Board”) or, in the discretion of the Board, by a committee (the “Committee”), providing for the granting to its employees or other individuals, stock options to purchase the Company’s Series B common stock, par value $0.0001 per share; and

WHEREAS, the Plan provides for the grant of certain options which are intended to be incentive stock options (“Incentive Stock Options” or “Options”) within the meaning of Selection 422(b) of the Code; and

WHEREAS, the Employee is an officer or key employee who is in a position to make an important contribution to the long-term performance of the Company;

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants hereinafter set forth and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows:

1.            Grant.  The Company hereby grants to the Employee an Incentive Stock Option to purchase _______ shares of Series B common stock, par value $0.0001 per share (the “Shares”), at the price set forth in Section 2, on the terms and conditions hereinafter stated and subject to any limitations contained in the Plan.

2.            Exercise Price.  The purchase price per Share is _____ dollars and ______ cents ($_____) which was 100% of the fair market value of the common stock subject to the option on the grant date as determined by the Board.

3.            Vesting.  Unless otherwise terminated as provided by this Agreement, this option will vest (and thereby become exercisable) as follows: ____ of the number of Shares will vest at the end of each full month that elapses following _______, 20__.  Vesting will depend on Employee’s continued employment with the Company through the applicable vesting date.  The unvested portion of the Option shall not be exercisable.

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4.            Expiration.  The vested portion of the options shall expire on the earliest of (A) ______ (__) years from date of grant, (B) ninety days after Employee ceases to be an employee of the Company for any reason other than Employee’s death or Disability (as defined below), or (C) one year after Employee ceases to be an employee of the Company due to death or Disability; provided that if Employee dies during the ninety day period described in clause (B) of this paragraph, the expiration date of the vested portion of the Option shall be one year after the date of Employee’s death.

5.            Adjustments in Shares and Purchase Price.

(a)            When all outstanding shares of Series B common Stock of the Company have been converted into Series A common stock, par value $0.0001 per share (“Series A Shares”), the Shares that will be issued upon the exercise of this option shall be Series A Shares, and all references in this option to Shares or Series B common stock shall thenceforth be references to Series A Shares

(b)            In the event of changes in the outstanding Series B common stock or in the capital structure of the Company, other than the conversion of shares of Series B common stock into Series A Shares, by reason of any stock or extraordinary cash dividend, stock split, reverse stock split, an extraordinary corporate transaction such as any recapitalization, reorganization, merger, consolidation, combination, exchange, or other relevant change in capitalization occurring after the date of grant of this option, the exercise price and the number of Shares subject to this option will be equitably adjusted or substituted, as to the number, price or kind of a share of securities or other consideration to the extent necessary to preserve the economic intent of such Award, as determined by the Board or Committee.

(c)            Upon the dissolution or liquidation of the Company, or upon a reorganization, merger, or consolidation of the Company as a result of which the outstanding securities of the class then subject to options hereunder are changed into or exchanged for cash or property or securities not of the Company’s issue, or upon a sale of substantially all the property of the Company to, or the acquisition of stock representing more than eighty percent (80%) of the voting power of the stock of the Company then outstanding by, another corporation or person, this option shall terminate, unless provision is made in writing in connection with such transaction for the assumption of options theretofore granted under the Plan, or the substitution of such options by any options covering the stock of a successor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices, in which event this option shall continue in the manner and under the terms so provided.

(d)            To the extent that the foregoing adjustments relate to stock or securities of the Company or the exercise price of this option, such adjustments shall be made by the Board or Committee, whose determination in that respect shall be final, binding and conclusive.

(e)            The grant of this option shall not affect in any way the right of power of the Company to make adjustments, reclassifications, reorganizations or changes of its capital or business structure or to merge or to consolidate or to dissolve, liquidate or sell, or transfer all or any part of its business or assets.

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6.            Effect of Termination of Employment.  In the event of termination of the Employee’s Continuous Service for any reason other than his or her death or disability, this option may not be exercised after the date three months following the date of termination of Employees Continuous Service, and may be exercisable only up to the amount vested on the date of termination.  “Continuous Service” means that the Employee’s service with the Company, whether as an employee, consultant, or director, is not interrupted or terminated, as determined in accordance with the Plan.

7.            Effect of Death or Disability.  This option shall be exercisable during the Employee’s lifetime only by the Employee and shall be nontransferable by the Employee otherwise than by will or the laws of descent and distribution.

(a)            In the event the Employee’s Continuous Service terminates on account of the Employee’s disability, this option may not be exercised after the earlier of (i) date 12 months following such termination, and (ii) the expiration of the term of this option, and this option shall be exercisable only up to the amount vested under Section 3 on the date of disability.  Disability shall have the meaning ascribed to it under Section 22(e)(3) of the Code.

(b)            In the event Employee’s Continuous Service terminates due to Employee’s death, or if Employee dies during the three month period following termination of Employee’s Continuous Service during which the Employee is permitted to exercise this option pursuant to Section 6, this option may be exercised by the executor or administrator of the Employee’s estate or any person who shall have acquired the option from the Employee by his or her will or the applicable law of descent and distribution, during a period ending on the earlier of (i) 12 months following the date of death, and (ii) the expiration of the term of this option, with respect to the number of Shares for which the deceased Employee would have been entitled to exercise at the time of his or her death, including the number of Shares that vested upon his death under Section 3, subject to adjustment under Section 5.  Any such transferee exercising this option must furnish the Company upon request of the Committee (i) written notice of his or her status as transferee, (ii) evidence satisfactory to the Company to establish the validity of the transfer of the option in compliance with any laws of regulations pertaining to said transfer, and (iii) written acceptance of the terms and conditions of the option as prescribed in this Agreement.

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8.            How to Exercise Option.  This option may be exercised by the person then entitled to do so as to any Share which may then be purchased by giving written notice of exercise to the Company, specifying the number of full Shares to be purchased and accompanied by full payment of the purchase price thereof and the amount of any income tax the Company is required by law to withhold by reason of such exercise.  The Option Exercise Price of Shares acquired pursuant to an Option shall be paid, to the extent permitted by applicable statutes and regulations, either (a) in cash or by certified or bank check at the time the Option is exercised or (b) the Option Exercise Price may be paid: (i) by delivery to the Company of other Shares, duly endorsed for transfer to the Company, with a Fair Market Value on the date of delivery equal to the Option Exercise Price (or portion thereof) due for the number of shares being acquired (a "Stock for Stock Exchange"); (ii) a "cashless" exercise program established with a broker pursuant to which the broker exercises or arranges for the coordination of the exercise of the Option with the sale of some or all of the underlying Shares; (iii) any combination of the foregoing methods; or (iv) in any other form of consideration that is legal consideration for the issuance of Shares and that may be acceptable to the Board or Committee. The exercise price of Shares acquired pursuant to an Option that is paid by delivery to the Company of other Shares acquired, directly or indirectly from the Company, shall be paid only by Shares that have been held for more than six months (or such longer or shorter period of time required to avoid a charge to earnings for financial accounting purposes).  Notwithstanding the foregoing, during any period for which the Company has any security registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or is required to file reports under Section 15(d) of the Exchange Act, or has filed a registration statement that has not yet become effective under the Securities Act of 1933, as amended, and that it has not withdrawn , if the Employee is a director or officer of the Company, any exercise that involves or may involve a direct or indirect extension of credit or arrangement of an extension of credit by the Company, directly or indirectly, in violation of Section 402(a) of the Sarbanes-Oxley Act of 2002 shall be prohibited.

9.            No Rights as Shareholder Prior to Exercise.  Neither the Employee nor any person claiming under or through the Employee shall be or have any of the rights or privileges of a shareholder of the Company in respect of any of the Shares issuable upon the exercise of the option until the date of receipt of payment (including any amounts required by income tax withholding requirements) by the Company.

10.            Notices.  Any notice to be given to the Company under the terms of this Agreement shall be addressed to the Company at its principal executive office, or at such other address as the Company may hereafter designate in writing.  Any notice to be given to the Employee shall be addressed to the Employee as the address set forth beneath his or her signature hereto, or at any such other address as the Employee may hereafter designate in writing.  Any such notice shall be deemed to have been duly given three (3) days after being addressed as aforesaid and deposited in the United States mail, first class postage prepaid.

11.            Restrictions on Transfer.  Except as otherwise provided herein, the option herein granted and the rights and privileges conferred hereby shall not be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and shall not be subject to sale under execution attachment or similar process upon the rights and privileges conferred hereby.  Any transfer, assignment, pledge or other disposal of said option, or of any right or privilege conferred hereby, contrary to the provisions hereof, or any sale under any execution, attachment or similar process upon the rights and privileges conferred hereby, shall immediately be null and void and shall not vest in any purported assignee or transferee any rights or privileges of the optionee, under this Agreement or otherwise with respect to such options.  Notwithstanding the preceding two sentences, in conjunction with the exercise of an option, and for the purpose of obtaining financing for such exercise, the option holder may arrange for a securities broker/dealer to exercise an option on the option holder’s behalf, to the extent necessary to obtain funds required to pay the exercise price of the option.

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12.            Successor and Assigns.  Subject to the limitations on transferability contained herein, this Agreement shall be binding upon and inure to the benefit of the heirs, legal representatives, successors, and assigns of the parties hereto.

13.            Additional Restrictions.  The rights awarded hereby are subject to the requirement that, if at any time the Board or the Committee shall determine, in its discretion, that the listing, registration or qualification of the Shares subject to such rights upon any securities exchange or under any state or federal law, or the consent or approval of any government regulatory body, is necessary or desirable as a condition of, or in connection with, the granting of such rights or the issuance or purchase of Shares in connection with the exercise of such rights, then such rights may not be exercised in whole or in part unless such listing, registration, qualification, consent or approval shall have been affected or obtained free of any conditions not acceptable to the Board or the Committee.  Furthermore, if the Board or Committee determines that amendment to any stock option (including but not limited to the increase in the exercise price) is necessary or desirable in connection with the registration or qualification of any Shares or other securities under the securities or “blue sky” laws of any state, then the Board or Committee shall have the unilateral right to make such changes without the consent of the Employee.

14.            Notice of Sale or Other Disposition of Shares.  In the event the Employee disposes of any of the Shares that may be acquired hereunder at any time within two years of the date hereof or one year from the date the Shares were acquired, the Employee agrees to notify the Company in writing within ten days of the date of such disposition, of the number of Shares disposed of, the nature of the transaction, and the amount received (if any) upon such disposition.  Employee understands that such a disposition may result in imposition of withholding taxes, and agrees to remit to the Company on request any amounts requested to satisfy any withholding tax liability.

15.            Terms of Employment.  Subject to any employment contract with the Employee, the terms of employment of the Employee shall be determined from time to time by the Company and the Company shall have the right, which is hereby expressly reserved, to terminate the Employee or change the terms of the employment at any time for any reason whatsoever, with or without good cause. The Employee agrees to notify in writing the Corporate Secretary of the Company of the Employee’s intention, if any, to terminate Employee’s employment within ten days after said intention is formed.

16.            Payment of Taxes.  Whenever Shares are to be issued to the Employee in satisfaction of the rights conferred hereby, the Company shall have the right to require the Employee to remit to the Company an amount sufficient to satisfy federal, state and local withholding tax requirements prior to the delivery of any certificate or certificates for such Shares.

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17.            Terms and Conditions of Plan.  This Agreement is subject to, and the Company and the Employee agree to be bound by, all of the terms and conditions of the Plan, as the same shall have been amended from time to time in accordance with the terms thereof, provided that no such amendment shall deprive the Employee, without his or her consent, of any of his or her rights hereunder, except as otherwise provided in this Agreement or in the Plan.  The Shares acquired hereunder may also be subject to restrictions on transfer and/or rights of repurchase that may be contained in the Bylaws of the Company or in separate agreements with Employee.  The Board or the Committee shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules.  All actions taken and all interpretations and determinations made by the Board or the Committee in good faith shall be final and binding upon Employee, the Company and all other interested persons.  No member of the Board or the Committee shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or this Agreement.

18.            Severability.  In the event that any provision in this Agreement shall be invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on the remaining provisions of this Agreement.

19.            Governing Law.  This Agreement shall be governed by and construed under the laws of the state of Delaware, without regard to conflicts of law provisions.

IN WITNESS HEREOF, the parties hereto have executed this Agreement, as of the day and year first above written.

COMPANY:

 

	
Asterias Biotherapeutics, Inc.

	
 

	
 

	
 

	 	
(Signature)

	
	
By: 

	
 

	
 

	Title  		

 

 

	EMPLOYEE:	
	
 

	
 

	 	
(Signature)

	
	 	
	 	(Please Print Name)	

 

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PURCHASE FORM

(To be executed upon exercise of Option)

 

To Asterias Biotherapeutics, Inc.:

The undersigned hereby irrevocably elects to exercise the right of purchase represented by the Option Agreement dated _____________, and to purchase thereunder, __________ shares of Series B common stock, as provided for therein, and tenders herewith payment of the Exercise Price ($______ per share) in full in the form of a bank wire transfer to the account of the Company, cash, a certified check, or bank cashier's check in the amount of $______________.

Please issue a certificate or certificates for such shares of Series B common stock in the name of, and pay any cash for any fractional share to:

 

	
 

	
 

	
(Please Print Name)

	
 

	
 

	
 

	
 

	
 

	
(Please Print Address)

	
 

	
 

	
 

	
 

	
 

	
(Social Security Number or

	
 

	
Other Taxpayer Identification Number)

	
 

	
 

	
 

	 	
	(Signature)	

 

NOTE:    The above signature should correspond exactly with the name on the face of the Option Agreement.

And, if said number of shares shall not be all the shares purchasable under the Option Agreement, a new Option Agreement is to be issued in the name of said undersigned for the balance remaining of the shares purchasable thereunder less any fraction of a share paid in cash.

 

 

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