Document:

Exhibit 10.2

SHARE TRANSFER AGREEMENT

BY AND AMONG

ASTERIAS BIOTHERAPEUTICS, INC.,

BIOTIME, INC.

AND

ES CELL INTERNATIONAL PTE LTD

 

SHARE TRANSFER AGREEMENT

This SHARE TRANSFER AGREEMENT (the “Agreement”) is entered into on February 16, 2016 (the “Effective Date”) by and among Asterias Biotherapeutics, Inc., a Delaware corporation having a place of business at 6300 Dumbarton Circle, Fremont, CA 94555 (“Asterias”), BioTime, Corp., a Delaware corporation having a place of business at 1301 Harbor Bay Parkway, Alameda, California 94502 (“BioTime”), and ES Cell International Pte Ltd, a Singapore corporation having a place of business at 11 Biopolis Way, #05-06 Helios, Singapore 138667 (“ESI”). Each of Asterias, BioTime and ESI is individually referred to as “Party” and collectively as the “Parties.”

RECITALS

WHEREAS, BioTime, Asterias and ESI have agreed to enter into a cross-license agreement on the Closing Date in the form attached hereto as Exhibit A (the “Cross License Agreement”) pursuant to which BioTime will receive a non-exclusive license from Asterias under the Asterias Patent Rights, Asterias will receive a non-exclusive license from BioTime under the BioTime Patent Rights and Asterias will receive a non-exclusive license from ESI under the ESI Patent Rights; and

WHEREAS, BioTime and Asterias have agreed to enter into a sub-license agreement on the Closing Date in the form attached hereto as Exhibit B (the “Sublicense Agreement”) pursuant to which Asterias will receive a non-exclusive sublicense from BioTime under the Sublicense Patent Rights;

WHEREAS, BioTime currently holds 21,823,340 shares of Asterias Series A Common Stock (the “Asterias Common Stock”), par value $0.0001 per share (the “Asterias Shares”);

WHEREAS, BioTime currently holds warrants to purchase 3,150,000 shares of Asterias Common Stock at an exercise price of $5.00 per share of Asterias Common Stock (the “Asterias Warrants”);

WHEREAS, Asterias currently holds 21,925 shares of common stock, which is the entirety of Asterias’ entire ownership, of Cell Cure Neurosciences Ltd. (the “Cell Cure Interests”);

WHEREAS, Asterias currently holds 2,100,000, which is the entirety of Asterias’ ownership, of the outstanding shares of Common Stock, no par value per share (the “OrthoCyte Shares”) of OrthoCyte Corporation (“OrthoCyte”);

WHEREAS, ESI is a wholly-owned subsidiary of BioTime;

WHEREAS, Asterias has engaged Lake Street Capital Markets to conduct an independent valuation analysis with respect to each of the licenses, transfers and assignments being effected pursuant to the Applicable Agreements;

WHEREAS, the Parties desire to enter into this Agreement to agree upon the consideration to be paid by each of Asterias, BioTime and ESI on the Closing Date for the licenses, transfers and assignments contemplated by the Cross License Agreement and the Sublicense Agreement and to effect the payments from each of Asterias, BioTime and ESI on the Closing Date for such licenses, transfers and assignments through the transfer of a portion of the Cell Cure Interests and the OrthoCyte Shares from Asterias to BioTime and the Asterias Warrants and a portion of the Asterias Shares from BioTime to Asterias;

 

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WHEREAS, Asterias and BioTime desire to enter into this Agreement to effect the transfer on the Closing Date of the Cell Cure Interests and the OrthoCyte Shares to BioTime by Asterias in exchange for the transfer of BioTime’s entire ownership in the Asterias Warrants and a portion of BioTime’s ownership of Asterias Shares to Asterias by BioTime.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and other good and valuable consideration, the receipt and the legal sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, hereby agree as follows:

ARTICLE 1. DEFINITIONS

The terms, as defined herein, shall have the same meanings in both their singular and plural forms.

	1.1	“Applicable Agreements” means the Cross-License Agreement and the Sublicense Agreement.

	1.2	“Asterias Patent Rights” has the meaning ascribed to such term in the Cross License Agreement.

	1.3	“BioTime Patent Rights” has the meaning ascribed to such term in the Cross License Agreement.

	1.4	“ESI Patent Rights” has the meaning ascribed to such term in the Cross License Agreement.

	1.5	“Sublicense Patent Rights” shall mean the Patent Rights licensed to Asterias in the Sublicense Agreement.

	1.6	“Warrant Agreement” means the Warrant Agreement dated October 1, 2013, between Asterias and BioTime, in the form attached hereto as Exhibit B-1.

ARTICLE 2. FAIR MARKET VALUE OF THE LICENSES, TRANSFERS AND ASSIGNMENTS CONTEMPLATED BY THE APPLICABLE AGREEMENTS

	2.1	Fair Market Value of the licenses to Asterias from BioTime and ESI Pursuant to the Cross License Agreement and the Sublicense Agreement. The fair market value of the licenses being granted to Asterias by BioTime and ESI pursuant to the Cross License Agreement and the Sublicense Agreement is hereby deemed by each of BioTime, ESI and Asterias to be approximately $1,158,000.

	2.2	Fair Market Value of the license to BioTime Pursuant to the Cross License Agreement. The fair market value of the license being granted to BioTime pursuant to the Cross License Agreement is hereby deemed by each of Asterias and BioTime to be approximately $2,747,500.

 

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	2.3	Net Difference in Value of the licenses awarded under the Cross License and Sublicense Agreements. The Parties hereby agree that the difference in value of the licenses referred to in Section 2.1 and 2.2 shall be $1,589,500, in favor of Asterias.

ARTICLE 3. VALUE OF THE SECURITIES HELD BY BIOTIME AND ASTERIAS

	3.1	Fair Market Value of the OrthoCyte Shares. The fair market value of the OrthoCyte Shares is hereby deemed by each of the Parties to be $785,000.

	3.2	Fair Market Value of the Cell Cure Interests. The fair market value of the Cell Cure Interests is hereby deemed by each of the Parties to be $765,000.

	3.3	Fair Market Value of the Asterias Warrants. The fair market value of the Asterias Warrants, including the value of foregone distribution rights as described in Section 7.1 of this Agreement, is hereby deemed by each of the Parties to be $2,906,883.

	3.4	Fair Market Value of each Asterias Share. The fair market value of each Asterias Share, which was derived from the volume weighted 20 day average trading price of Asterias Series A Common Stock on the NYSE MKT, during the period from December 30, 2015 to January 28, 2016, is hereby deemed by each of the Parties to be $3.07.

ARTICLE 4. ASSETS AS CONSIDERATION FOR THE LICENSES, TRANSFERS AND ASSIGNMENTS CONTEMPLATED BY THE APPLICABLE AGREEMENTS

	4.1	Consideration to Asterias from BioTime. As consideration for the rights and licenses to the Asterias assets specified in Section 4.2, (a) BioTime and ESI, agree to enter into the Cross License Agreement on the Closing Date to provide Asterias with a non-exclusive license under the BioTime Patent Rights and the ESI Patent Rights, and (b) BioTime agrees to (i) enter into the Sublicense Agreement on the Closing Date to provide Asterias with a non-exclusive license under the Sublicense Patent Rights, (ii) deliver on the Closing Date to Asterias all of the Asterias Warrants, (iii) deliver on the Closing Date to Asterias a stock certificate for 75,771 of the Asterias Shares accompanied by a stock power duly signed by BioTime with respect to such shares, or in the alternative, BioTime is agreeing to direct its agents to effectuate such transfer via book entry on the Closing Date, and (iv) forego its rights to receive warrants distributed by Asterias to its shareholders, as described in Section 7.1 of this Agreement

	4.2	Consideration to BioTime from Asterias. As consideration for the rights and licenses to the BioTime assets specified in Section 4.1, Asterias agrees to (a) enter into the Cross License Agreement on the Closing Date to provide BioTime with a non-exclusive license under the Asterias Patent Rights, (b) transfer to BioTime, and BioTime agrees to accept from Asterias, in each case on the Closing Date, all of Asterias’ interest in and to all of the OrthoCyte Shares and all of the Cell Cure Interests.

 

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ARTICLE 5. CLOSING

	5.1	Subject to the satisfaction or waiver of the conditions set forth in Section 5.2 and Section 5.3, the closing of all of the transactions contemplated by Article 4and Section 7.1 of this Agreement, in each case pursuant to the terms of this Agreement (the “Closing”), shall take place at the offices of counsel to Asterias, at a time to be agreed upon by Asterias and BioTime, on a date (which shall be no later than the second Business Day after the satisfaction or waiver of all of the conditions set forth in Section 5.2 and Section 5.3) to be agreed upon by Asterias and BioTime. For purposes of this Agreement, “Closing Date” shall mean the date on which the Closing actually takes place.

	5.2	Asterias’ obligation to take the actions required to be taken by Asterias at the Closing are subject to the satisfaction, at or prior to the Closing, of the following condition (which may be waived by Asterias, in whole or in part, in writing):

		(a)	BioTime shall not have taken any action which would prevent or impair BioTime’s ability to enter into and consummate (i) the Cross License Agreement, (ii) the Sublicense Agreement, and (iii) each of the transfers to be effected by BioTime pursuant to this Agreement.

	5.3	BioTime’s obligation to take the actions required to be taken by BioTime at the Closing are subject to the satisfaction, at or prior to the Closing, of the following condition (which may be waived by BioTime, in whole or in part, in writing):

		(a)	Asterias shall not have taken any action which would prevent or impair Asterias’ ability to enter into and consummate (i) the Cross License Agreement, (ii) the Sublicense Agreement, and (iii) each of the transfers to be effected by Asterias pursuant to this Agreement.

ARTICLE 6. REPRESENTATIONS AND WARRANTIES

	6.1	By Asterias. Asterias represents, warrants and covenants that, as of the Effective Date and the Closing Date:

		(a)	Organization. Asterias is a corporation, duly organized, validly existing, and in good standing under the Laws of the State of Delaware.

		(b)	Authorization of Transaction. Asterias has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all requisite corporate action on the part of Asterias. This Agreement has been duly and validly executed and delivered by Asterias and (assuming the due authorization, execution and delivery by the other parties hereto) this Agreement constitutes legal, valid and binding obligations of Asterias, enforceable against Asterias in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity). No consent, waiver, approval, order, permit or authorization of, or declaration or filing with, or notification to, any person is required on the part of Asterias in connection with the execution and delivery of this Agreement or the compliance by Asterias with any of the provisions hereof.

 

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		(c)	Noncontravention. Neither the execution and the delivery of this Agreement, nor the consummation of the transactions contemplated hereby will (i) violate any law to which Asterias is subject or any provision of the organizational documents of Asterias or (ii) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under any contract, lease, sublease, license, sublicense, franchise, permit, indenture, agreement or mortgage for borrowed money, or other agreement to which Asterias is a party or by which it is bound or to which any of its assets are subject.

		(d)	Title to Assets; No Liens. Asterias holds title to the OrthoCyte Shares and Cell Cure Interests free and clear of all security interests and other monetary liens and encumbrances, and has not entered into any contract or agreement to transfer, sell, or assign, or granting to any third party any right or option to purchase, any of the OrthoCyte Shares or Cell Cure Interests.

		(e)	Brokers’ Fees. Asterias has no liability or obligation to pay any fees or commissions to any broker, finder, or agent with respect to the transactions contemplated by this Agreement for which any other Party could become liable or obligated.

	6.2	By BioTime. BioTime represents, warrants and covenants that, as of the Effective Date and the Closing Date:

		(a)	Organization. BioTime is a corporation, duly organized, validly existing, and in good standing under the Laws of the State of Delaware.

		(b)	Authorization of Transaction. BioTime has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all requisite corporate action on the part of BioTime. This Agreement has been duly and validly executed and delivered by BioTime and (assuming the due authorization, execution and delivery by the other parties hereto) this Agreement constitutes legal, valid and binding obligations of BioTime, enforceable against BioTime in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity). No consent, waiver, approval, order, permit or authorization of, or declaration or filing with, or notification to, any person is required on the part of BioTime in connection with the execution and delivery of this Agreement or the compliance by BioTime with any of the provisions hereof.

 

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		(c)	Noncontravention. Neither the execution and the delivery of this Agreement, nor the consummation of the transactions contemplated hereby will (i) violate any law to which BioTime is subject or any provision of the organizational documents of BioTime or (ii) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under any contract, lease, sublease, license, sublicense, franchise, permit, indenture, agreement or mortgage for borrowed money, or other agreement to which BioTime is a party or by which it is bound or to which any of its assets are subject.

		(d)	Brokers’ Fees. BioTime has no liability or obligation to pay any fees or commissions to any broker, finder, or agent with respect to the transactions contemplated by this Agreement for which any other Party could become liable or obligated.

ARTICLE 7. COVENANTS

	7.1	Cancellation of the Warrant Agreement. On the Closing Date, upon the transfer of the Asterias Warrants from BioTime to Asterias, the Warrant Agreement shall be deemed cancelled and shall have no further effect. Furthermore, BioTime acknowledges that Asterias plans to issue certain warrants to purchase common stock of Asterias to its shareholders on a pro-rata basis, and in consideration for the assets to be received by BioTime set forth in Section 4.2, BioTime hereby irrevocably waives its right to receive such warrants and acknowledges that it has received sufficient consideration for its foregone right to receive such warrants.

	7.2	Access to Books and Records; Financial Reporting. For as long as the financial statements of Asterias are required to be consolidated with BioTime’s financial statements for financial reporting purposes in accordance with United States generally accepted accounting principles (“GAAP”), and, in the case of paragraph (a) for a period of six years thereafter, the provisions of this Section 7.2 shall apply.

		(a)	BioTime and its employee and employees of BioTime’s independent registered public accountants, in each case who sign a customary confidentiality agreement requiring such person and BioTime to keep all confidential or proprietary information of Asterias confidential, shall at all times during regular business hours (which shall be 9:00 a.m. to 5:30 p.m. Monday through Friday other than federal holidays in which banks in San Francisco, California are required or permitted to close) have the right, upon five (5) business days prior notice to Asterias, to enter any and all offices of Asterias where Asterias’ books and records are kept and to inspect, review, copy, and audit such financial books and records, minutes of the proceedings of the directors and stockholders of Asterias, stockholder records, and contracts, instruments, and agreements, in each case solely to the extent necessary to comply with GAAP and in a manner that does not interfere with the day to day operations of Asterias, at BioTime’s expense. Asterias shall make its relevant officers and employees available to, and shall otherwise reasonably cooperate with, BioTime and BioTime’s independent registered public accountants, in connection with their inspection, copying, review, and audit of such books and records of Asterias. The provisions of this Section 7.1(a) shall not apply to documents not in the public domain, embodying or disclosing Asterias’ proprietary technology or confidential information.

 

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		(b)	Subject to the terms and conditions of Section 7.2(a), Asterias shall make its relevant officers and employees available to, and shall otherwise reasonably cooperate with, including providing answers to questions asked by BioTime and BioTime’s independent registered public accountants, in connection with BioTime’s preparation of the Management’s Discussion and Analysis of Financial Condition and Results of Operations, or any similar portion, of BioTime’s quarterly reports on Form 10-Q and annual reports on Form 10-K, to the extent related to the results of operations, revenues, expenses, and other financial results of Asterias for the applicable financial reporting period.

		(c)	BioTime and Asterias shall consult with each other, in good faith, with respect to the financial accounting for, and reporting of, transactions to which Asterias is a party or which otherwise are required to be reported or reflected in the financial statements and notes thereto of Asterias and BioTime, for the purpose of maintaining consistency in such reporting in conformity with GAAP.

		(d)	If an event occurs that is required to be disclosed by Asterias on Form 8-K (a “Reportable Event”), regardless of whether Asterias elects to report such event on a Form 10-Q or Form 10-K rather than on Form 8-K, Asterias will notify BioTime’s Chief Financial Officer of the Reportable Event promptly after the occurrence of such Reportable Event and shall provide BioTime’s Chief Financial Officer with the information that Asterias intends to include in a current report on Form 8-K, a quarterly report on Form 10-Q or annual report on Form 10-K, whichever shall first be filed, reporting such event, in sufficient time prior to the required date for reporting such event to permit BioTime, to the extent it determines the Reportable Event to be material to BioTime, to so report the Reportable Event in such time and in such manner as required by the rules and regulations of the Securities and Exchange Commission. If the Reportable Event pertains to Asterias’ entry into or amendment or modification of any contract or agreement that constitutes a material contract required to be reported in response to Item 1.01 of Form 8-K, Asterias shall provide BioTime with a complete copy of such contract or agreement, including all exhibits and schedules thereto. If Asterias plans to submit an application to the SEC seeking an order for confidential treatment of any portion of a material contract or agreement, Asterias shall so notify BioTime, and if BioTime determines that it is required by applicable law or regulation to file such contract or agreement as an exhibit to any report or registration statement filed with the SEC, BioTime shall file the same version of such contract or report as is filed by Asterias and BioTime and Asterias shall cooperate in the preparation and submission of the applications by BioTime and Asterias for an order permitting confidential treatment such portions of the contract or agreement as they may determine.

 

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	7.3	Reporting this Agreement and Agreements Referenced Herein. BioTime and Asterias shall cooperate in preparing for timely filing consistent current reports on Form 8-K and a joint press release reporting the execution of this Agreement and the Cross License Agreement by the parties and the consummation of the transactions described herein and therein.

ARTICLE 8. MISCELLANEOUS PROVISIONS

	8.1	Assignability. No Party may assign this Agreement or the rights granted herein except with the prior written consent of the other Parties.

	8.2	No Waiver. No waiver by any Party of any breach or default of any covenant or agreement set forth in this Agreement shall be deemed a waiver as to any subsequent and/or similar breach or default.

	8.3	No Third Party Beneficiaries. This Agreement shall not confer any rights or remedies upon any person other than the Parties and their respective successors and permitted assigns.

	8.1	Governing Laws. The validity, construction and effect of this Agreement shall be determined exclusively in accordance with the laws of the State of Delaware, without regard to its provisions concerning the applicability of laws of other jurisdictions. Any suit with respect hereto will be brought in courts of the State of Delaware and the Parties hereby agree and submit to the personal jurisdiction and venue thereof.

	8.2	Waiver of Jury Trial. WITH RESPECT TO ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, EACH PARTY HEREBY IRREVOCABLY, TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW THAT CANNOT BE WAIVED, WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY ACTION ARISING IN WHOLE OR IN PART UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, AND AGREES THAT ANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR AGREEMENT AMONG THE PARTIES IRREVOCABLY TO WAIVE ITS RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

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	8.3	Entire Agreement. This Agreement embodies the entire understanding of the Parties and supersedes all previous communications, representations or understandings, either oral or written, between the Parties relating to the subject matter hereof.

	8.4	Amendments. No amendment or modification of this Agreement shall be valid or binding on the Parties unless made in writing and signed on behalf of each Party.

	8.5	Severability. In the event that any of the provisions contained in this Agreement is held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Agreement, and this Agreement shall be construed as if the invalid, illegal, or unenforceable provisions had never been contained in it.

	8.6	Counterparts; Facsimile Transmission. This Agreement may be executed simultaneously in two or more counterparts, any one of which need not contain the signatures of more than one Party, but all such counterparts taken together will constitute one and the same Agreement. Delivery of executed signature pages hereof by facsimile transmission or portable document format (PDF) shall constitute effective and binding execution and delivery of this Agreement.

	8.7	Headings. The headings of the several sections are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

[This page is intentionally left blank.]

 

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IN WITNESS WHEREOF, Asterias, BioTime and ESI have executed this Agreement, in duplicate originals, by their respective and duly authorized officers on the day and year written.

 

	
Asterias Biotherapeutics, Inc.

	 	
BioTime, Inc.

	 	 	 	 	 
	
By:

	
/s/Pedro Lichtinger

	 	
By:

	
/s/Michael D. West

	 	
Pedro Lichtinger

	 	 	
Michael D. West

	 	 	 	 	 
	
Title: President and Chief Executive Office

	 	
Title: Co-Chief Executive Officer

	 	 	 	 	 
	 	 	 	
By:

	
/s/Aditya Mohanty

	 	 	 	 	
Aditya Mohanty

	 	 	 	 	 
	 	 	 	
Title: Co-Chief Executive Officer

	
ES Cell International Pte Ltd

	 
	 	 	 
	
By:

	
/s/Aditya Mohanty

	 
	 	 	 
	
Title:

	
CEO

	 

 

 

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Exhibit 10.1

 

APPLE HOSPITALITY REIT, INC.

2014 OMNIBUS INCENTIVE PLAN

 

RESTRICTED STOCK AGREEMENT

COVER SHEET

Apple Hospitality REIT, Inc., a Virginia corporation (the “Company”), hereby grants shares of Stock to the Grantee named below, subject to the vesting and other conditions set forth below (the “Restricted Stock”).  Additional terms and conditions of the Restricted Stock are set forth on this cover sheet and in the attached Restricted Stock Agreement (together, the “Agreement”), and in the Apple Hospitality REIT, Inc. 2014 Omnibus Incentive Plan (as amended from time to time, the “Plan”).

	
Grant Date:

	  	  
	
 

Name of Grantee:

	  	  
	
 

Number of Shares of Restricted Stock:

	  	  
	
 

Vesting Schedule:

	  	  

By your signature below, you agree to all of the terms and conditions described in this Agreement and in the Plan (a copy of which is also attached).  You acknowledge that you have carefully reviewed the Plan and agree that the Plan will control in the event any provision of this Agreement should appear to be inconsistent.

	
Grantee:

	  	  	
Date:

	  	  
	  	
(Signature)

	  	  	  	  
	  	  	  	  	  	  
	
Company:

	  	  	
Date:

	  	  
	  	
(Signature)

	  	  	  	  
	
Name:

	  	  	  	  	  
	
Title:

	  	  	  	  	  

Attachment

This is not a share certificate or a negotiable instrument.

 

  

  

  

 

APPLE HOSPITALITY REIT, INC.

2014 OMNIBUS INCENTIVE PLAN

 

RESTRICTED STOCK AGREEMENT

 

	
Restricted Stock

	
This Agreement evidences an award of shares of Restricted Stock in the number set forth on the cover sheet and subject to the terms and conditions set forth in the Agreement, the Plan and on the cover sheet.

 

	
Transfer of Unvested Restricted Stock

	
Shares of Restricted Stock may not be sold, assigned, transferred, pledged, hypothecated, or otherwise encumbered, whether by operation of law or otherwise, nor may the shares of Restricted Stock be made subject to execution, attachment, or similar process.  If you attempt to do any of these things, you will immediately and automatically forfeit your shares of Restricted Stock.

 

	
Issuance and Vesting

	
The Company will issue your shares of Restricted Stock in the name set forth on the cover sheet.

 

Your shares of Restricted Stock will vest in accordance with the vesting schedule set forth on the cover sheet of this Agreement, so long as you continue in Service on each applicable vesting date set forth on the cover sheet.

 

Notwithstanding your vesting schedule, the shares of Restricted Stock shall become 100% vested upon your termination of Service due to your death or Disability.  No additional portion of your shares of Restricted Stock shall vest after your Service has terminated for any reason.

 

	
Change in Control

	
Notwithstanding the vesting schedule set forth above, upon the consummation of a Change in Control, the shares of Restricted Stock will become 100% vested (i) if the shares of Restricted Stock are not assumed, or equivalent restricted securities are not substituted for the shares of Restricted Stock, by the Company or its successor, or (ii) if the shares of Restricted Stock are assumed or substituted for, upon the termination of your Service by the Company or its successor for reasons other than Cause or by you for Good Reason (as defined below), in each case within the twelve (12)-month period following the consummation of the Change in Control.

 

“Good Reason” means any action by the Company without your consent that results in any of the following: (a) a reduction of your annual salary to an amount which is materially less than the amount of your Annual Base Salary (as defined below); (b) a material reduction in your duties with the Company, provided that a change in title or position shall not be “Good Reason” absent a material reduction in duties; or (c) a relocation of more than 50 miles from your workplace of 814 East Main Street, Richmond, Virginia 23219.  An act or omission shall not constitute Good Reason unless (i) within 30 days after you know or reasonably should know of an event described above, or within 30 days after the last in a series of such events, you give written notice to the Company indicating that you intend to terminate your Service for Good Reason, (ii) your termination occurs within 60 days after you know or reasonably should know of an event described above, or within 60 days after the last in a series of such events, and (iii) the Company has failed to remedy the event described above within 30 days after receiving your written notice. If the Company remedies the event described above within 30 days after receiving your written notice, you may not terminate for Good Reason on account of the event specified in your notice.

 

“Annual Base Salary” means an amount equal to twelve times the highest monthly base salary paid or payable, including any base salary which has been earned but deferred, to you by the Company in respect of the 12-month period immediately preceding the month in which the Change in Control occurs.

 

 

  

  

  

 

	
Evidence of Issuance

	
The issuance of the shares of Restricted Stock will be evidenced in such a manner as the Company, in its discretion, deems appropriate, including, without limitation, book-entry, registration, or issuance of one or more share certificates, with any unvested shares of Restricted Stock bearing the appropriate restrictions imposed by this Agreement.  As your interest in the shares of Restricted Stock vests, the recordation of the number of shares of Restricted Stock attributable to you will be appropriately modified if necessary.

 

	
Forfeiture of Unvested Restricted Stock

	
Unless the termination of your Service triggers accelerated vesting of your shares of Restricted Stock or other treatment pursuant to the terms of this Agreement or the Plan, you will immediately and automatically forfeit to the Company all of the unvested shares of Restricted Stock in the event your Service terminates for any reason.

 

	
Forfeiture of Rights

	
If you should take actions in violation or breach of, or in conflict with, any non-competition agreement, any agreement prohibiting solicitation of employees or clients of the Company or any Affiliate, any confidentiality obligation with respect to the Company or any Affiliate, any Company or Affiliate policy or procedure, or any other agreement with, or other obligation to, the Company or any Affiliate, the Company has the right to cause an immediate forfeiture of your rights to the shares of Restricted Stock awarded under this Agreement, and the shares of Restricted Stock shall immediately and automatically expire.

 

 

  

  

  

 

	
No Section 83(b) Election

	
You hereby acknowledge and agree that you shall not make an election under Section 83(b) of the Code with respect to the shares of Restricted Stock to include in gross income in the year of transfer of the shares of Restricted Stock the amount specified in Section 83(b) of the Code or under any similar provisions of Applicable Law unless expressly permitted by action of the Committee in writing prior to the making of such election.

 

	
Leaves of Absence

	
For purposes of this Agreement, your Service does not terminate when you go on a bona fide leave of absence that was approved by your employer in writing if the terms of the leave provide for continued Service crediting, or when continued Service crediting is required by Applicable Laws.  Your Service terminates in any event when the approved leave ends unless you immediately return to active employee work.

 

Your employer may determine, in its discretion, which leaves count for this purpose and when your Service terminates for all purposes under the Plan in accordance with the provisions of the Plan.  Notwithstanding the foregoing, the Company may determine, in its discretion, that a leave counts for this purpose even if your employer does not agree.

 

	
Withholding

	
You agree as a condition of this grant of Restricted Stock that you will make acceptable arrangements to pay any withholding or other taxes that may be due as a result of the vesting or the receipt of the shares of Restricted Stock.  In the event that the Company or any Affiliate determines that any federal, state, local or foreign tax or withholding payment is required relating to the Restricted Stock, the Company or any Affiliate will have the right to require such payments from you or withhold such amounts from other payments due to you from the Company or any Affiliate, or withhold the delivery of vested shares of Stock otherwise deliverable under this Agreement.  You may elect to satisfy such obligations, in whole or in part, (i) by causing the Company or any Affiliate to withhold shares of Stock otherwise issuable to you or (ii) by delivering to the Company or any Affiliate shares of Stock already owned by you.  The shares of Stock so delivered by you shall have an aggregate Fair Market Value equal to such withholding obligations.  The maximum number of shares of Stock that may be withheld to satisfy any applicable tax withholding obligations arising from the vesting of the shares of Restricted Stock may not exceed such number of shares of Stock having a Fair Market Value equal to the minimum statutory amount required by the Company to be withheld and paid to any federal, state, local  or foreign taxing authority with respect to such vesting of the shares of Restricted Stock, or such greater amount as may be permitted under applicable accounting standards.

 

 

  

  

  

 

	
Retention Rights

	
This Agreement and the grant of Restricted Stock evidenced by this Agreement do not give you the right to be retained by the Company or any Affiliate in any capacity. The Company or an Affiliate, as applicable, reserves the right to terminate your Service at any time and for any reason.

 

	
Stockholder Rights

	
You have the right to vote the shares of Restricted Stock and to receive any dividends declared or paid on such shares.  Any stock distributions you receive with respect to unvested shares of Restricted Stock as a result of any stock split, stock dividend, combination of shares, or other similar transaction shall be deemed to be a part of the Restricted Stock and subject to the same conditions and restrictions applicable thereto.  [Any cash dividends paid on unvested shares of Restricted Stock you hold on the record date for such dividend shall be paid to you in cash at the same time paid to other stockholders of the Company as of the record date for such dividend and shall not be subject to the conditions and restrictions applicable to the unvested shares of Restricted Stock.]  [Any cash dividends paid on unvested shares of Restricted Stock you hold on the record date for such dividend shall be held by the Company and subject to the same conditions and restrictions applicable to your unvested shares of Restricted Stock; provided that, within thirty (30) days after the date on which the applicable shares of Restricted Stock vest in accordance with the terms of this Agreement, such dividends shall be paid to you, without interest.  You will immediately and automatically forfeit such dividends to the extent that you forfeit the corresponding unvested shares of Restricted Stock.]  Except as described in the Plan, no adjustments are made for dividends or other rights if the applicable record date occurs before an appropriate book entry is made (or your certificate is issued).

 

Your Restricted Stock grant shall be subject to the terms of any applicable agreement of merger, liquidation, or reorganization in the event the Company is subject to such corporate activity, consistent with Section 18 of the Plan.

 

	
Legends

	
If and to the extent that the shares of Restricted Stock are represented by certificates rather than book entry, all certificates representing the shares of Restricted Stock issued under this grant shall, where applicable, have endorsed thereon the following legends:

 

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN VESTING, FORFEITURE, AND OTHER RESTRICTIONS ON TRANSFER SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER, OR HIS OR HER PREDECESSOR IN INTEREST.  A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY BY THE HOLDER OF RECORD OF THE SHARES REPRESENTED BY THIS CERTIFICATE.”

 

To the extent the shares of Restricted Stock are represented by a book entry, such book entry will contain an appropriate legend or restriction similar to the foregoing.

 

 

  

  

  

 

	
Clawback

	
The shares of Restricted Stock are subject to mandatory repayment by you to the Company to the extent you are or in the future become subject to (a) any Company “clawback” or recoupment policy that is adopted to comply with the requirements of any Applicable Law, rule or regulation, or otherwise, or (b) any law, rule or regulation which imposes mandatory recoupment, under circumstances set forth in such law, rule or regulation.

 

	
Applicable Law

	
This Agreement will be interpreted and enforced under the laws of the Commonwealth of Virginia, other than any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to the laws of any other jurisdiction.

 

	
The Plan

 

	
The text of the Plan is incorporated in this Agreement by reference.

 

Certain capitalized terms used in this Agreement are defined in the Plan and have the meaning set forth in the Plan.

 

This Agreement and the Plan constitute the entire understanding between you and the Company regarding the shares of Restricted Stock.  Any prior agreements, commitments, or negotiations concerning the Restricted Stock are superseded; except that any written employment, consulting, confidentiality, non-competition, non-solicitation, and/or severance agreement between you and the Company or any Affiliate, as applicable, shall supersede this Agreement with respect to its subject matter.

 

	
Data Privacy

	
To administer the Plan, the Company may process personal data about you.  Such data includes, but is not limited to, information provided in this Agreement and any changes thereto, other appropriate personal and financial data about you, such as your contact information, payroll information, and any other information that might be deemed appropriate by the Company to facilitate the administration of the Plan.  By accepting the grant of Restricted Stock, you give explicit consent to the Company to process any such personal data.

 

	
Electronic Delivery

	
By accepting the grant of Restricted Stock, you consent to receive documents related to the shares of Restricted Stock by electronic delivery and, if requested, to agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company, and your consent shall remain in effect throughout your term of Service and thereafter until you withdraw such consent in writing to the Company.

 

 

  

  

  

 

	
Code Section 409A

	
The grant of Restricted Stock under this Agreement is intended to comply with Code Section 409A (“Section 409A”) to the extent subject thereto, and, accordingly, to the maximum extent permitted, this Agreement will be interpreted and administered to be in compliance with Section 409A.  Notwithstanding anything to the contrary in the Plan or this Agreement, neither the Company, its Affiliates, the Board, nor the Committee will have any obligation to take any action to prevent the assessment of any excise tax or penalty on you under Section 409A, and neither the Company, its Affiliates, the Board, nor the Committee will have any liability to you for such tax or penalty.

 

By accepting this Agreement, you agree to all of the terms and conditions described above and in the Plan.

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