Document:

Exhibit 10.2

 

APREA THERAPEUTICS, INC.

 

EMPLOYEE STOCK PURCHASE PLAN

 

1. Purpose.  The purpose of the Aprea Therapeutics, Inc. Employee Share Purchase Plan (this “Plan”) is to provide eligible Employees with a convenient means of acquiring an equity interest in the Company through payroll deductions or other contributions in order to enhance such employees’ sense of participation in the affairs of the Company.  This Plan shall apply to Offering Periods beginning on or after the effective date of the initial public offering of the Shares, as determined by the Committee (as defined below).

 

This Plan includes two components: (a) a component intended to qualify as an “employee stock purchase plan” under Section 423 of the Code (the “423 Component”), the provisions of which shall be construed so as to extend and limit participation in a uniform and nondiscriminatory manner consistent with the requirements of Section 423 of the Code; and (b) a component that does not qualify as an “employee stock purchase plan” under Section 423 of the Code (the “Non-423 Component”), under which options shall be granted pursuant to rules, procedures or sub-plans adopted by the Committee designed to achieve tax, securities laws or other objectives for eligible Employees, the Company and its Participating Subsidiaries.  Except as otherwise provided in this Plan, the Non-423 Component will operate and be administered in the same manner as the 423 Component.

 

2. Definitions.  As used herein, the terms set forth below have the meanings assigned to them in this Section 2 and shall include the plural as well as the singular.

 

1933 Act means the Securities Act of 1933, as amended.

 

1934 Act means the Securities Exchange Act of 1934, as amended.

 

Board means the Board of Directors of Aprea Therapeutics, Inc.

 

Business Day shall mean a day on which The NASDAQ Global Select Market (“NASDAQ”) is open for trading.

 

Brokerage Account means the account in which the Purchased Shares are held.

 

Code means the Internal Revenue Code of 1986, as amended.

 

Committee means the Compensation Committee of the Board, or the designee of the Compensation Committee.

 

Company means Aprea Therapeutics, Inc., a Delaware corporation.

 

Compensation means the base pay received by a Participant, plus commissions, overtime and regular annual, quarterly and monthly cash bonuses and vacation, holiday and sick pay. Compensation does not include: (1) income related to stock option awards, stock grants and other equity incentive awards; (2) expense reimbursements; (3) relocation-related payments; (4) benefit plan payments (including but not limited to short-term disability pay, long-term disability pay, maternity pay, military pay, tuition reimbursement and adoption assistance); (5) deceased pay; (6) income from non-cash and fringe benefits; (7) severance payments; and (8) other forms of compensation not specifically listed herein.

 

Employee means any individual who is a common law employee of the Company or any other Participating Subsidiary. For purposes of the Plan, the employment relationship shall be treated as continuing intact while the individual is on sick leave or other leave of absence approved by the Company or the Participating Subsidiary, as appropriate, and only to the extent permitted under Section 423 of the

 

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Code with respect to the 423 Component.  For purposes of the Plan, an individual who performs services for the Company or a Participating Subsidiary pursuant to an agreement (written or oral) that classifies such individual’s relationship with the Company or a Participating Subsidiary as other than a common law employee shall not be considered an “employee” with respect to any period preceding the date on which a court or administrative agency issues a final determination that such individual is an “employee.”

 

Enrollment Date means the first Business Day of each Offering Period.

 

Exercise Date means the last Business Day of each Offering Period (or, if determined by the Committee, the Purchase Period if different from the Offering Period).

 

Fair Market Value on or as of any date means the “NASDAQ Official Closing Price” (as defined on www.nasdaq.com) (or such substantially similar successor price thereto) for a Share as reported on www.nasdaq.com (or a substantially similar successor website) on the relevant valuation date or, if no NASDAQ Official Closing Price is reported on such date, on the preceding day on which a NASDAQ Official Closing Price was reported; or, if the Shares are no longer listed on NASDAQ, the closing price for Shares as reported on the official website for such other exchange on which the Shares are listed.

 

Offering Period means every six-month period beginning each January 1st and July 1st or such other period designated by the Committee; provided that in no event shall an Offering Period exceed 27 months, with the commencement of the first Offering Period to be determined by the Committee.  Notwithstanding anything herein to the contrary, the Committee may establish an Offering Period with multiple Purchase Periods within such Offering Period.

 

Option means an option granted under this Plan that entitles a Participant to purchase Shares.

 

Participant means an Employee who satisfies the requirements of Sections 3 and 5 of the Plan.

 

Participating Subsidiary means each Subsidiary other than those that the Committee or the Board has excluded from participation in the Plan.

 

Plan means this Aprea Therapeutics, Inc. Employee Stock Purchase Plan.

 

Purchase Account means the account used to purchase Shares through the exercise of Options under the Plan.

 

Purchase Period means the period designated by Committee during which payroll deductions or other contributions of the Participants are accumulated under the Plan.  A Purchase Period may coincide with an entire Offering Period or there may be multiple Purchase Periods within an Offering Period, as determined by the Committee prior to the commencement of the applicable Offering Period.

 

Purchase Price shall be the lesser of: (i) 85% percent of the Fair Market Value of a Share on the applicable Enrollment Date for an Offering Period and (ii) 85% percent of the Fair Market Value of a Share on the applicable Exercise Date; provided, however, that the Committee may determine a different per share Purchase Price provided that such per share Purchase Price is communicated to Participants prior to the beginning of the Offering Period and provided that in no event shall such per share Purchase Price be less than the lesser of (i) 85% of the Fair Market Value of a Share on the applicable Enrollment Date or (ii) 85% of the Fair Market Value of a Share on the Exercise Date.

 

Purchased Shares means the full Shares issued or delivered pursuant to the exercise of Options under the Plan.

 

Shares means the common stock, par value $0.001 per share, of the Company.

 

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Subsidiary means an entity, domestic or foreign, of which not less than 50% of the voting equity is held by the Company or a Subsidiary, whether or not such entity now exists or is hereafter organized or acquired by the Company or a Subsidiary; provided such entity is also a “subsidiary” within the meaning of Section 424 of the Code.

 

Termination Date means the date on which a Participant terminates employment or on which the Participant ceases to provide services to the Company or a Subsidiary as an employee, and specifically does not include any period following that date which the Participant may be eligible for or in receipt of other payments from the Company including in lieu of notice or termination or severance pay or as wrongful dismissal damages.

 

3. Eligibility.

 

(a) Only Employees of the Company or a Participating Subsidiary shall be eligible to be granted Options under the Plan and, in no event may a Participant be granted an Option under the Plan following his or her Termination Date.

 

(b) Any provisions of the Plan to the contrary notwithstanding, no Employee shall be granted an Option under the 423 Component of the Plan if (i) immediately after the grant, such Employee (or any other person whose stock would be attributed to such Employee pursuant to Section 424(d) of the Code) would own capital stock of the Company and/or hold outstanding Options or options to purchase stock possessing 5% or more of the total combined voting power or value of all classes of stock of the Company or of any of its Subsidiaries or (ii) such Option would permit his or her rights to purchase stock under all employee stock purchase plans (described in Section 423 of the Code) of the Company and its Subsidiaries to accrue at a rate that exceeds $25,000 of the Fair Market Value of such stock (determined at the time each such Option is granted) for each calendar year in which such Option is outstanding at any time. Except as otherwise determined by the Committee prior to the commencement of an Offering Period, no Participant may purchase more than 5,000 Shares during any Offering Period.

 

4. Exercise of an Option. Options shall be exercised on behalf of Participants in the Plan every Exercise Date, using payroll deductions that have accumulated in the Participants’ Purchase Accounts during the immediately preceding Purchase Period or that have been retained from a prior Purchase Period pursuant to Section 8 hereof.

 

5. Participation.

 

(a) An Employee shall be eligible to participate on the first Enrollment Date that occurs at least 90 days (or such other time determined by the committee and consistent with Section 423 of the Code with respect to the 423 Component) after such Employee’s first date of employment with the Company or a Participating Subsidiary; provided, that such Employee properly completes and submits an election form by the deadline prescribed by the Company.

 

(b) An Employee who does not become a Participant on the first Enrollment Date on which he or she is eligible may thereafter become a Participant on any subsequent Enrollment Date by properly completing and submitting an election form by the deadline prescribed by the Company.

 

(c) Payroll deductions for a Participant shall commence on the first payroll date following the Enrollment Date and shall end on the last payroll date in the Purchase Period to which such authorization is applicable, unless sooner terminated by the Participant as provided in Section 12 hereof.

 

6. Payroll Deductions.

 

(a) A Participant shall elect to have payroll deductions made during a Purchase Period equal to no less than 1% of the Participant’s Compensation up to a maximum of 15% (or such greater amount as the

 

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Committee establishes from time to time). The amount of such payroll deductions shall be in whole percentages. All payroll deductions made by a Participant shall be credited to his or her Purchase Account. A Participant may not make any additional payments into his or her Purchase Account.  Notwithstanding the foregoing or any provisions to the contrary in the Plan, the Committee may allow participants to make other contributions under the Plan via cash, check, or other means instead of payroll deductions if payroll deductions are not permitted under applicable local law, and for any Offering Period under the 423 Component, the Committee determines that such other contributions are permissible under Section 423 of the Code.

 

(b) Except as otherwise determined by the Committee prior to commencement of an Offering Period, a Participant may not increase or decrease the rate of payroll deductions during an Offering Period. A Participant may change his or her payroll deduction percentage under subsection (a) above for any subsequent Offering Period by properly completing and submitting an election change form in accordance with the procedures prescribed by the Committee. The change in amount shall be effective as of the first Enrollment Date following the date of filing of the election change form.

 

(c) Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of the Code and Section 3(b) hereof, a Participant’s payroll deductions may be decreased to 0% at any time during an Offering Period. Payroll deductions shall recommence at the rate provided in such Participant’s election form at the beginning of the first Offering Period which is scheduled to end in the following calendar year, unless terminated by the Participant as provided in Section 12 hereof.

 

7. Grant of Option. On the applicable Enrollment Date, each Participant in an Offering Period shall be granted an Option to purchase on the applicable Exercise Date a number of full Shares determined by dividing such Participant’s payroll deductions accumulated prior to such Exercise Date and retained in the Participant’s Purchase Account as of the applicable Exercise Date by the applicable Purchase Price.

 

8. Exercise of Option. A Participant’s Option for the purchase of Shares shall be exercised automatically on the Exercise Date, and the maximum number of Shares subject to the Option shall be purchased for such Participant at the applicable Purchase Price with the accumulated payroll deductions in his or her Purchase Account.  If the Fair Market Value of a Share on the first day of the current Offering Period in which a participant is enrolled is higher than the Fair Market Value of a Share on the first day of any subsequent Offering Period, the Company may establish procedures to automatically enroll such participant in the subsequent Offering Period and any funds accumulated in a participant’s account prior to the first day of such subsequent Offering Period will be applied to the purchase of shares on the Exercise Date immediately prior to the first day of such subsequent Offering Period. A participant does not need to file any forms with the Company to be automatically enrolled in the subsequent Offering Period.

 

No fractional Shares shall be purchased; any payroll deductions accumulated in a Participant’s Purchase Account which are not sufficient to purchase a full Share shall be retained in the Purchase Account for the next subsequent Purchase Period, subject to earlier withdrawal by the Participant as provided in Section 12 hereof. All other payroll deductions accumulated in a Participant’s Purchase Account and not used to purchase Shares on an Exercise Date shall be distributed to the Participant. During a Participant’s lifetime, a Participant’s Option is exercisable only by him or her. The Company shall satisfy the exercise of all Participants’ Options for the purchase of Shares through (a) the issuance of authorized but unissued Shares, (b) the transfer of treasury Shares, (c) the purchase of Shares on behalf of the applicable Participants on the open market through an independent broker and/or (d) a combination of the foregoing.

 

9. Issuance of Stock. The Shares purchased by each Participant shall be issued in book entry form and shall be considered to be issued and outstanding to such Participant’s credit as of the end of the last day of each Purchase Period. The Committee may permit or require that shares be deposited directly in a

 

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Brokerage Account with one or more brokers designated by the Committee or to one or more designated agents of the Company, and the Committee may use electronic or automated methods of share transfer. The Committee may require that Shares be retained with such brokers or agents for a designated period of time and/or may establish other procedures to permit tracking of disqualifying dispositions of such shares, and may also impose a transaction fee with respect to a sale of Shares issued to a Participant’s credit and held by such a broker or agent. The Committee may permit Shares purchased under the Plan to participate in a dividend reinvestment plan or program maintained by the Company, and establish a default method for the payment of dividends.

 

10. Approval by Stockholders. Notwithstanding the above, the Plan is expressly made subject to the approval of the stockholders of the Company within 12 months before or after the date the Plan is adopted by the Board. Such stockholder approval shall be obtained in the manner and to the degree required under applicable federal and state law. If the Plan is not so approved by the stockholders within 12 months before or after the date the Plan is adopted by the Board, this Plan shall not come into effect.

 

11. Administration.

 

(a) Powers and Duties of the Committee. The Plan shall be administered by the Committee. Subject to the provisions of the Plan, Section 423 of the Code and the regulations thereunder with respect to the 423 Component, the Committee shall have the discretionary authority to determine the time and frequency of granting Options, the duration of Offering Periods and Purchase Periods, the terms and conditions of the Options and the number of Shares subject to each Option.   The Committee shall also have the discretionary authority to do everything necessary and appropriate to administer the Plan, including, without limitation, interpreting the provisions of the Plan (but any such interpretation shall not be inconsistent with the provisions of Section 423 of the Code with respect to the 423 Component).  All actions, decisions and determinations of, and interpretations by the Committee with respect to the Plan shall be final and binding upon all Participants and upon their executors, administrators, personal representatives, heirs and legatees. No member of the Board or the Committee shall be liable for any action, decision, determination or interpretation made in good faith with respect to the Plan or any Option granted hereunder.  With respect to the 423 Component, an Offering Period shall be administered so as to ensure that all Participants have the same rights and privileges as are provided by Section 423(b)(5) of the Code.

 

(b) Administrator. The Company, Board or the Committee may engage the services of a brokerage firm or financial institution (the “Administrator”) to perform certain ministerial and procedural duties under the Plan including, but not limited to, mailing and receiving notices contemplated under the Plan, determining the number of Purchased Shares for each Participant, maintaining or causing to be maintained the Purchase Account and the Brokerage Account, disbursing funds maintained in the Purchase Account or proceeds from the sale of Shares through the Brokerage Account, filing with the appropriate tax authorities proper tax returns and forms (including information returns) and providing to each Participant statements as required by law or regulation.

 

(c) Indemnification. Each person who is or shall have been (a) a member of the Board, (b) a member of the Committee, or (c) an officer or employee of the Company to whom authority was delegated in relation to this Plan, shall be indemnified and held harmless by the Company against and from any loss, cost, liability or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action, suit or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by him or her in settlement thereof, with the Company’s approval, or paid by him or her in satisfaction of any judgment in any such claim, action, suit or proceeding against him or her; provided, however, that he or she shall give the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf, unless

 

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such loss, cost, liability or expense is a result of his or her own willful misconduct or except as expressly provided by statute.

 

The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company’s certificate of incorporation or bylaws, any contract with the Company, as a matter of law, or otherwise, or of any power that the Company may have to indemnify them or hold them harmless.

 

12. Withdrawal. A Participant may withdraw from the Plan by properly completing and submitting to the Company a withdrawal form in accordance with the procedures prescribed by the Committee, which must be submitted prior to the date specified by the Committee before the last day of the applicable Offering Period. Upon withdrawal, any payroll deductions credited to the Participant’s Purchase Account prior to the effective date of the Participant’s withdrawal from the Plan will be returned to the Participant. No further payroll deductions for the purchase of Shares will be made during subsequent Offering Periods, unless the Participant properly completes and submits an election form, by the deadline prescribed by the Company. A Participant’s withdrawal from an offering will not have any effect upon his or her eligibility to participate in the Plan or in any similar plan that may hereafter be adopted by the Company.

 

13. Termination of Employment. On the Termination Date of a Participant for any reason prior to the applicable Exercise Date, whether voluntary or involuntary, and including termination of employment due to retirement, death or as a result of liquidation, dissolution, sale, merger or a similar event affecting the Company or a Participating Subsidiary, the corresponding payroll deductions credited to his or her Purchase Account will be returned to him or her or, in the case of the Participant’s death, to the person or persons entitled thereto under Section 16, and his or her Option will be automatically terminated.

 

14. Interest. No interest shall accrue on the payroll deductions of a Participant in the Plan.

 

15. Stock.

 

(a) The stock subject to Options shall be common stock of the Company as traded on the NASDAQ or on such other exchange as the Shares may be listed.

 

(b) Subject to adjustment upon changes in capitalization of the Company as provided in Section 18 hereof, the maximum number of Shares which shall be made available for sale under the Plan shall be 250,000 Shares.  In addition, subject to adjustments upon changes in capitalization of the Company as provided in Section 18 hereof, the maximum number of Shares which shall be made available for sale under the Plan shall automatically increase on the first trading day in January of each calendar year during the term of this Plan, commencing with January 1 2020, by an amount equal to the lesser of (i) one percent (1%) of the total number of Shares issued and outstanding on December 31 of the immediately preceding calendar year, (ii) 250,000 Shares or (iii) such number of Shares as may be established by the Board.  If, on a given Exercise Date, the number of Shares with respect to which Options are to be exercised exceeds the number of Shares then available under the Plan, the Committee shall make a pro rata allocation of the Shares remaining available for purchase in as uniform a manner as shall be practicable and as it shall determine to be equitable.

 

(c) A Participant shall have no interest or voting right in Shares covered by his or her Option until such Option has been exercised and the Participant has become a holder of record of Shares acquired pursuant to such exercise.

 

16. Designation of Beneficiary. The Committee may permit Participants to designate beneficiaries to receive any Purchased Shares or payroll deductions, if any, in the Participant’s accounts under the Plan in the event of such Participant’s death. Beneficiary designations shall be made in accordance with

 

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procedures prescribed by the Committee. If no properly designated beneficiary survives the Participant, the Purchased Shares and payroll deductions, if any, will be distributed to the Participant’s estate.

 

17. Assignability of Options. Neither payroll deductions credited to a Participant’s Purchase Account nor any rights with regard to the exercise of an Option or to receive Shares under the Plan may be assigned, transferred, pledged or otherwise disposed of in any way (other than by will, the laws of descent and distribution or as provided in Section 16 hereof) by the Participant. Any such attempt at assignment, transfer, pledge or other disposition shall be without effect, except that the Company may treat such act as an election to withdraw from an Offering Period in accordance with Section 12 hereof.

 

18. Adjustment of Number of Shares Subject to Options.

 

(a) Adjustment. Subject to any required action by the stockholders of the Company, the maximum number of securities available for purchase under the Plan, as well as the price per security and the number of securities covered by each Option under the Plan which has not yet been exercised shall be appropriately adjusted in the event of any a stock split, reverse stock split, stock dividend, combination or reclassification of the common stock of the Company, or any other increase or decrease in the number of Shares effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.” Such adjustment shall be made by the Board or the Committee, whose determination in that respect shall be final, binding and conclusive. If any such adjustment would result in a fractional security being available under the Plan, such fractional security shall be disregarded. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Shares subject to an Option. The Options granted pursuant to the Plan shall not be adjusted in a manner that causes the Options to fail to qualify as options issued pursuant to an “employee stock purchase plan” within the meaning of Section 423 of the Code.

 

(b) Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Offering Period then in progress will terminate immediately prior to the consummation of such proposed action, unless otherwise provided by the Board, and the Board may either provide for the purchase of Shares as of the date on which such Offering Period terminates or return to each Participant the payroll deductions credited to such Participant’s Purchase Account.

 

(c) Merger or Asset Sale. In the event of a proposed sale of all or substantially all of the assets of the Company, or the merger of the Company with or into another corporation, each outstanding Option shall be assumed or an equivalent option substituted by the successor corporation or a parent or subsidiary of the successor corporation, unless the Board determines, in the exercise of its sole discretion, that in lieu of such assumption or substitution to either terminate all outstanding Options and return to each Participant the payroll deductions credited to such Participant’s Purchase Account or to provide for the Offering Period in progress to end on a date prior to the consummation of such sale or merger.

 

19. Amendments or Termination of the Plan.

 

(a) The Board or the Committee may at any time and for any reason amend, modify, suspend, discontinue or terminate the Plan without notice; provided that no Participant’s existing rights in respect of existing Options are adversely affected thereby. To the extent necessary to comply with Section 423 of the Code or any other applicable law, regulation or stock exchange rule, the Company shall obtain stockholder approval in such a manner and to such a degree as required.

 

(b) Without stockholder consent and without regard to whether any Participant rights may be considered to have been “adversely affected,” the Board or the Committee shall be entitled to change the Purchase Price, Offering Periods, Purchase Periods, eligibility requirements, limit or increase the frequency and/or

 

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number of changes in the amount withheld during a Purchase Period, establish the exchange ratio applicable to amounts withheld in a currency other than U.S. dollars, permit payroll withholding in an amount less than or greater than the amount designated by a Participant in order to adjust for delays or mistakes in the Company’s processing of properly completed withholding elections, establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts applied toward the purchase of Shares for each Participant properly correspond with amounts withheld from the Participant’s Compensation, and establish such other limitations or procedures as the Board or the Committee determines in its sole discretion advisable which are consistent with the Plan; provided, however, that changes to (i) the Purchase Price, (ii) the Offering Period, (iii) the Purchase Period, (iv) the maximum percentage of Compensation that may be deducted pursuant to Section 6(a) or (v) the maximum number of Shares that may be purchased in a Purchase Period, shall not be effective until communicated to Participants in a reasonable manner, with the determination of such reasonable manner in the sole discretion of the Board or the Committee.

 

20. No Other Obligations. The receipt of an Option pursuant to the Plan shall impose no obligation upon the Participant to purchase any Shares covered by such Option. Nor shall the granting of an Option pursuant to the Plan constitute an agreement or an understanding, express or implied, on the part of the Company to employ the Participant for any specified period.

 

21. Notices and Communication. Any notice or other form of communication which the Company or a Participant may be required or permitted to give to the other shall be provided through such means as designated by the Committee, including but not limited to any paper or electronic method.

 

22. Condition upon Issuance of Shares.

 

(a) Shares shall not be issued with respect to an Option unless the exercise of such Option and the issuance and delivery of such Shares pursuant thereto shall comply with all applicable provisions of law, domestic or foreign, including, without limitation, the 1933 Act and the 1934 Act and the rules and regulations promulgated thereunder, and the requirements of any stock exchange upon which the Shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance.

 

(b) As a condition to the exercise of an Option, the Company may require the person exercising such Option to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required by any of the aforementioned applicable provisions of law.

 

23. General Compliance. The Plan will be administered and Options will be exercised in compliance with the 1933 Act, 1934 Act and all other applicable securities laws and Company policies, including without limitation, any insider trading policy of the Company.

 

24. Term of the Plan. The Plan shall become effective upon the earlier to occur of (i) its adoption by the Board and (ii) its approval by the stockholders of the Company (the “Effective Date”), and shall continue in effect until the earlier of (A) the termination of the Plan pursuant to Section 19 hereof and (B) the ten-year anniversary of the Effective Date, with no new Offering Periods commencing on or after such ten-year anniversary.

 

25. Governing Law. The Plan and all Options granted hereunder shall be construed in accordance with and governed by the laws of the State of Delaware without reference to choice of law principles and subject in all cases to the Code and the regulations thereunder.

 

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26. Non-U.S. Participants.  Without the amendment of the Plan, the Company may provide for the participation in the Plan by Employees who are subject to the laws of foreign countries or jurisdictions on such terms and conditions different from those specified in the Plan as may in the judgment of the Company be necessary or desirable to foster and promote achievement of the purposes of the Plan and, in furtherance of such purposes the Company may make such modifications, amendments, procedures, subplans and the like as may be necessary or advisable to comply with provisions of laws of other countries or jurisdictions in which the Company or the Participating Subsidiaries operate or have employees. Each subplan shall constitute a separate “offering” under this Plan in accordance with Treas. Reg. §1.423-2(a) and, to the extent inconsistent with the requirements of Section 423, any such subplan shall be considered part of the Non-423 Component, and rights granted thereunder shall not be required by the terms of the Plan to comply with Section 423 of the Code.

 

27. Section 409A.  The 423 Component is exempt from the application of Section 409A of the Code, and any ambiguities herein shall be interpreted to so be exempt from Section 409A of the Code. The Non-423 Component is intended to be exempt from the application of Section 409A of the Code under the short-term deferral exception and any ambiguities shall be construed and interpreted in accordance with such intent. In furtherance of the foregoing and notwithstanding any provision in the Plan to the contrary, if the Committee determines that an option granted under the Plan may be subject to Section 409A of the Code or that any provision in the Plan would cause an option under the Plan to be subject to Section 409A, the Committee may amend the terms of the Plan and/or of an outstanding option granted under the Plan, or take such other action the Committee determines is necessary or appropriate, in each case, without the participant’s consent, to exempt any outstanding option or future option that may be granted under the Plan from or to allow any such options to comply with Section 409A of the Code, but only to the extent any such amendments or action by the Committee would not violate Section 409A of the Code. Notwithstanding the foregoing, the Company shall have no liability to a participant or any other party if the option under the Plan that is intended to be exempt from or compliant with Section 409A of the Code is not so exempt or compliant or for any action taken by the Committee with respect thereto.

 

9Exhibit 10.3

 

*Certain information, identified by [***], has been excluded from the exhibit because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.

 

Customs Synthesis Agreement

 

This contract agreement (“Agreement”) is executed by and between APREA (“Aprea”), Fogdevreten 2B, SE-17177 Stockholm, Sweden

 

And

 

SYNGENE International Private Limited (“SYNGENE”), Biocon Park, Plot Nos 2 & 3, Industrial Area, Bommasandra IV Phase, Jigani Link Road, Bangalore-560099, India,

 

Rectials

 

Whereas, APREA wishes to entrust SYNGENE to perform customs GMP Synthesis of APR-246 (Syngene internal reference APR-050A (Prima-I Met))

 

Whereas, SYNGENE owns facilities suitable for synthesis of APREA’s request for GMP synthesis of APR-246, and is willing to synthesize for APREA, according to APREA’s requirements of APR-246

 

Now, therefore, it is agreed as under.

 

A.                               Subject Matter of the Agreement:

 

Under the terms and conditions of this Agreement SYNGENE shall synthesize and ship to APREA [***] of APR-246 according to GMP (ICH Q7A).

 

B.                               Specific Duties of SYNGENE: 

 

In assuming responsibility for undertaking this Agreement,

 

(a)                       SYNGENE shall synthesize and deliver to APREA a total of [***] of APR-246. The delivery and payment schedule shall be as per the milestones set forth in Appendix 1 to this Agreement. Delivery shall be made in accordance with Incoterms DDP (Delivered Duty Paid) APREA:s premises in Solna.

 

(b)                       Together with the delivery of APR-246, SYNGENE will also supply APREA with a detailed report covering the following:

 

·                       Full list of all materials used in the production of APR-246.

·                       Specification and quality control procedures for all above mentioned raw materials.

 

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·                       Certificates of analysis of all batches used in the production of APR-246 for all above mentioned raw materials.

·                       The process as such described in steps. For every step SYNGENE shall provide a reaction scheme, a flow diagram/chart, exact quantities of incoming materials cited, the exact quantity of APR-246 obtained, along with data for theoretical, expected and realized yield. The process clearly described (quantities, time, temperature, pressure, pH and other values or ranges should be clearly stated).

 

(c)                        SYNGENE expressly warrants and undertakes that any and all quantities of APR-246 delivered by SYNGENE to APREA under this Agreement shall fully comply with specifications set forth in Appendix 2 attached hereto.

 

(d)                       SYNGENE shall allow inspection/audit of its production site, equipment, GMP conditions, laboratories, personnel etc. involved in production of APR-246 by APREA or representatives of APREA on prior notice basis and on mutually accepted date.

 

(e)                        In performing its duties under this Agreement, SYNGENE will perform the synthesis in a good workmanship manner and in compliance with all applicable Indian laws and industry standards.

 

C.                                    APREA’s Obligations:

 

APREA shall pay to SYNGENE a sum of [***] as full consideration for SYNGENE:s performance under this agreement.

 

All payments shall be based on the milestones as set forth in Appendix I. Payments shall be due within [***] of date of invoice. All payments made by APREA will be in United States Dollars.

 

The compensation stipulated by this paragraph is fixed and covers all costs SYNGENE may have in connection with this Agreement, including materials, taxes so SYNGENE shall have no further claims from APREA on any basis.

 

D.                                    Confidentiality:

 

With respect to any and all information relating to the process for synthesis of APR 050A as well as other information or data acquired by SYNGENE as a

 

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result of this Agreement or from performance of the synthesis to be rendered hereunder (“Confidential Information”), SYNGENE agrees that it will not

 

·      Disclose to any third party or use for any purpose other than for performing synthesis entrusted hereunder

·                       Permit any of its employees, consultants or representatives (e.g. non-employees used by SYNGENE to perform the synthesis or any part of it) to, use said Confidential Information other than the purposes of this Agreement,

·                       Permit any of its employees, consultants or representatives to, disclose any of said Confidential Information to a third party except as is required pursuant to the purposes of this Agreement provided APREA has approved it in writing.

·                       Allow any of its employees, consultants or representatives to, publish or submit for publication said Confidential Information without APREA’s prior approval.

 

SYNGENE’s obligation with regard to confidential information shall continue for a period of [***] years from the date such Confidential Information is disclosed or made available to SYNGENE.

 

The foregoing obligation shall not apply to information, (i) which is or lawfully becomes generally available to the public through no fault of SYNGENE; (i) which is lawfully acquired from third parties who have a right to disclose such information or which by mutual agreement is released from a confidential status. Furthermore, SYNGENE may make such disclosure of Confidential Information that is required to be disclosed by any law, rule, regulation, subpoena, order, decree, or decision or other process of law having jurisdiction over SYNGENE provided that SYNGENE shall notify APREA of the provisions of law requiring such disclosure and restricting the disclosure to the minimum extent possible.

 

SYNGENE shall, as far as possible, limit the number of its employees who should get access to confidential information provided in connection with the performance of the synthesis hereunder. In addition, SYNGENE shall ensure that the said employees must agree in writing to be bound by and comply with the Confidentiality provisions of this Section D, unless already bound by a written confidentiality agreement with terms similar to those contained herein.

 

Promptly upon successful fulfillment of this Agreement or upon request of APREA, as the case may be, SYNGENE shall return to APREA any and all written information relating to APR 050A. However, Legal Counsel of SYNGENE will be entitled to retain one copy of the Confidential Information for sole purpose of record.

 

3

 

E.                                    Proprietary Rights:

 

For the avoidance of doubt, all intellectual property rights in relation to APR 050A and APREA’s product (which shall include, but not be limited to, any and all patents, patentable inventions, or applications for them and all know-how) whether arising in the results of the synthesis performed or otherwise pursuant to this Agreement shall belong exclusively to APREA without any limitations whatsoever and SYNGENE hereby assigns to APREA, without requesting any additional compensation, all rights, title and interest it may have in such intellectual property rights arising as a result of its performance of this Agreement.

 

F.                                     Term and Termination:

 

(a) This Agreement shall commence on the date first written above, and shall expire without prior notice when all obligations of the parties have been duly fulfilled.

 

(b) This Agreement may be terminated by APREA, by written notice to SYGENE, prior to the expiration of the term under the following conditions:

 

i)                                         If SYNGENE materially breaches any of the covenants and agreements under this Agreement,

 

ii)                                      If APREA determines that SYNGENE is substantially unable to perform assigned duties hereunder whether due to disability or incapacity, or any other reasons,

 

iii)                                   If an activity is not duly fulfilled at the date fixed in Appendix 1

 

(c) This Agreement may be terminated by SYNGENE, by written notice to APREA, prior to the expiration of the term under the following conditions:

 

i)                                         If Aprea fails to pay SYNGENE an amounts that are due and payable in accordance with Appendix 1.

 

A termination of this Agreement shall not affect the rights and liabilities of the parties incurred prior to termination. That means inter alia that SYNGENE shall be paid all amounts due and payable (in accordance with Appendix 1) prior to the termination date. Furthermore, a termination shall not affect any other remedy that the non-breaching party may have under this agreement or under law.

 

4

 

G.            Communications:

 

All communications associated with this Agreement shall be by first class mail or courier, addressed to the respective parties as follows:

 

To SYNGENE

[***]

Biocon Park, Plot Nos 2 & 3,

Industrial Area, Bommasandra IV Phase, 

JIgani Link Road, Bangalore 56 00 99 

India.

Ph: [***]

Fax: [***]

 

To APREA:

Jacob Westman

Fogdevreten 2B

SE-171 77 Stockholm

Sweden

Ph: +46 8 50884502

Fax: +46 8 50884511

 

The above named persons are action on behalf of their respective organizations and may be changed on and as needed basis. A party shall be given prompt written notice of such changes.

 

H.            Assignment:

 

APREA may assign this Agreement in whole or in part without SYNGENE’s consent; provided that no such assignment will expand the scope of SYNGENE hereunder without the prior written consent of SYNGENE and the permitted assignees assumes in writing all obligations of its assignor under this Agreement. This Agreement may not be assigned or otherwise transferred by SYNGENE without the prior written consent of APREA except that either party may assign this Agreement, in whole or in part, to an affiliate of such party or to a successor (including the surviving Company in any consolidation, reorganization, merger or demerger) or assignee of all or substantially all of its business to which this Agreement pertains without the consent of the other party.

 

5

 

SYNGENE and APREA are acting as independent parties and are not authorized to act for and on behalf of each other.

 

I.             Amendment:

 

No change or modification of the provisions of this Agreement shall be effective unless it is in writing and signed by a duly authorized officer of SYNGENE and APREA.

 

J.             Conflicts of Interest:

 

SYNGENE represents and warrants that it has the full power and right to enter into this Agreement. To avoid potential conflicts of interest, SYNGENE agrees to strictly honor its obligation of confidentiality under Section D, particularly as concerns SYNGENE’s agreements with other parties relating to the same or similar work as that to be done by SYNGENE under the Agreement.

 

K.            Governing law and dispute resolutions:

 

This Agreement is governed by the laws of Sweden. The parties agree that exclusive jurisdiction over and venue in any legal proceeding arising out of or relating to this Agreement or the relationship of the shall be brought in the Stockholm, Sweden

 

All disputes between the Parties arising out of this Agreement or in connection with it including its existence and validity shall be, failing amicable settlement, exclusively submitted to and finally resolved by Arbitration in accordance with the Rules of conciliation and arbitration of the International Chamber of Commerce (ICC) by one arbitrator. The language of the arbitration shall be English, and the place of arbitration shall be Stockholm, Sweden.

 

This Agreement is made in two (2) identical copies out of which one (1) for each of the parties hereto.

 

IN WITNESS WHEREOF the parties hereby execute this Agreement by their respective duly authorized officers.

 

	
SYNGENE   INTERNATIONAL PVT LIMITED
    	
 
    	
APREA
    
	
 
    	
 
    	
 
    
	
By:
    	
[***]
    	
 
    	
By:
    	
/s/ Claes Post
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Name :
    	
[***]
    	
 
    	
Name:
    	
Claes Post, Ph.D
    
	
Title :
    	
[***]
    	
 
    	
Title:
    	
Chief Executive Officer
    
	
Date :
    	
[***]
    	
 
    	
Date:
    	
 
    

 

6

 

APPENDIX 1

 

Stages and Milestone for Aprea [***]

 

Stage 1:

Activity

Procurement and set up: no later than *** 20***

 

Payment

*** days following ***:                                           USD [***]

 

Stage 2:

Activity

Delivery of [***] (meeting the Specification): no later than *** 20***

 

Payment

After approval by APREA :                                     USD [***]

 

Stage 3:

Activity

Preparation of development report including specification and establishment of batch manufacturing records: no later than *** 20***

 

Payment

After approval by APREA :                                     USD [***]

 

Stage 4:

Activity

Delivery of [***] (meeting the Specification): no later than *** 20***

 

Payment

After approval by APREA :                                        USD [***]

 

Payment terms:

 

7

 

Payment shall be made against invoice, due within [***] of the date of invoice, but not prior to the payment conditions set forth above.

 

Shall be executable on the Signature of:

 

	
For Syngene International Pvt Ltd
    	
 
    	
For   Aprea
    
	
 
    	
 
    	
 
    
	
By:
    	
[***]
    	
 
    	
By:
    	
/s/ Claes Post
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Name:
    	
[***]
    	
 
    	
Name:
    	
Claes Post, Prof.
    
	
Title:
    	
[***]
    	
 
    	
Title:
    	
CEO
    
	
Date:
    	
[***]
    	
 
    	
Date:
    	
27th March, 2007
    

 

 

8

 

APPENDIX - 2

 

Specification for APR-246

 

[***]

 

9

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