Document:

Exhibit 10.4

WARF Agreement No. 13-00300

NON-EXCLUSIVE LICENSE AGREEMENT

This Agreement is made effective as of the date of the last to sign party on page 15 (“Effective Date”), by and between the Wisconsin Alumni Research Foundation (“WARF”), a nonprofit Wisconsin corporation, and Asterias Biotherapeutics Incorporated (“Asterias”), a corporation organized and existing under the laws of Delaware, and its Affiliates who agree to sign on and be bound by the terms and obligations of this Agreement (collectively, “Licensee”). To the extent any Affiliate exercises any rights granted to Licensee hereunder, Asterias is liable to WARF for the duties and obligations of any such Affiliate, and any act or omission of an Affiliate that constitutes a breach of this Agreement shall be deemed to be a breach by Asterias.

WHEREAS, WARF owns or holds certain intellectual property rights to the inventions described in the Licensed Patents defined below; and

WHEREAS, Asterias (previously known as BioTime Acquisition Corporation) and its Affiliate BioTime, Inc. (“BioTime”) entered into an Asset Contribution Agreement dated January 4, 2013 with Geron Corporation (“Geron”), pursuant to which certain patents, know-how, documents, materials, and other assets relating to Geron’s embryonic stem cell programs will be contributed to Asterias (the “ACA”); and

WHEREAS, WARF previously granted to BioTime, a non-exclusive license under certain Licensed Patents, Licensed Materials, and Wisconsin Materials in certain fields covering certain products as provided therein, i.e., Agreement No. 08-0155, and amendments, (the “BioTime Research License”); and

WHEREAS, WARF and BioTime wish to maintain the BioTime Research License, and Licensee desires to obtain a license under the Licensed Patents, Licensed Materials and Wisconsin Materials for Internal Research (defined below) and to make, use and sell Products in the Licensed Field (all defined below) and WARF is willing to grant to Licensee such a license under the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, the parties covenant and agree as follows:

		Section 1.	Definitions.

For the purposes of this Agreement, the Appendix A definitions shall apply.

		Section 2.	Grant.

		A.	License.

(i)            Subject to the terms of Section 2B, WARF hereby grants Licensee a world-wide, nonexclusive license (a) under the Licensed Patents to make, use and receive Licensed Materials, and (b) under WARF’s rights in the Wisconsin Materials to make, use and receive Wisconsin Materials; in each case, solely for use in Internal Research.

(ii)            Subject to the terms of Section 2B, WARF hereby grants Licensee a world-wide, nonexclusive license (a) under the Licensed Patents to make, use and receive Licensed Materials, and (b) under WARF’s rights in the Wisconsin Materials to make, use and receive Wisconsin Materials; in each case to develop, make, have made, use, distribute, sell, import, and offer for sale Products in the Licensed Field and Licensed Territory; for clarity, Licensee may not distribute, sell or offer for sale any Wisconsin Materials, but may distribute, sell or offer for sale Products that are Derivative Materials.

 

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		B.	Restrictions and Limitations.

The licenses granted under this Agreement do not provide any right or license to: (i) grant any sublicenses under this Agreement to any third parties other than as expressly provided for below; or (ii) use the Licensed Patents, Wisconsin Materials or any Derivative Materials in the manufacture or distribution of Products for any commercial purpose or in human clinical trials in fields outside the Licensed Field.

		C.	Sublicensing.

(i)                  Licensee may grant written sublicenses to third parties under the nonexclusive licenses granted herein in the Licensed Field, but only:

(a)            To Contract Services Providers to enable the Contract Service Provider to perform specific services solely for Licensee’s benefit in support of Licensee’s development or commercialization of Products, under a written contract with Licensee, at Licensee’s expense, and pursuant to protocols or specifications developed by Licensee.  Such a sublicense may include a license to make or use Licensed Materials, Wisconsin Materials or Derivative Materials, or Products, solely for the purpose of providing the services to Licensee, or to sell Products as Licensee’s agent, but not to sell or transfer any of them for any other purpose, or to or for any other entity, and shall state the Licensed Materials, Wisconsin Materials and Derivative Materials must be destroyed within thirty (30) days of the completion or termination of the services.  Licensee will not receive from any Contract Services Provider any payments or any non-cash consideration in exchange for the grant of a sublicense hereunder and any Products sold by Contract Services Providers as Licensee’s agent will be treated as Products sold by Licensee under this Agreement.

(b)            To Collaborators to enable the Collaborator to engage in a project of collaborative research with Licensee on (i) the Licensed Materials or Wisconsin Materials, and cells derived from such Licensed Materials or Wisconsin Materials, and/or (ii) the development of Products, provided that the project is described and directed by a Collaborative Research Agreement including a specific workplan collaboratively established by Collaborator and Licensee and that Licensee has the first right to any data and IP arising from such Collaboration.  Such a sublicense may include a license to make or use the Licensed Materials, Wisconsin Materials or Derivative Materials, or Products, solely for the purpose of carrying out its obligations under the collaborative research project, but not to sell or transfer any of them for any purpose and shall state the Licensed Materials, Wisconsin Materials and Derivative Materials, and any Products, must be destroyed within thirty (30) days of the completion or termination of the project.  Licensee will not receive from any Collaborator any payments or any non-cash consideration in exchange for the grant of a sublicense hereunder.

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(c)            To Development Partners to enable the Development Partner to develop or commercialize Products initially substantially developed by Licensee, provided WARF does not disapprove as provided below.  In the event that such sublicense includes a grant of a limited commercial sublicense to a Development Partner: (i) a copy of such sublicense shall be provided to WARF for review at least [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] business days prior to execution, (ii) such sublicense shall specifically identify the Products covered by such commercial sublicense and shall only include rights under Licensed Patents and Wisconsin Materials as reasonably necessary in the development of those Products, (iii) Licensee, an Affiliate or Geron Corporation (“Geron”) must have previously invested at least [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] in the development of each Product to which the sublicense applies, and (iv) Licensee shall remain directly responsible for paying to WARF the consideration described in Sections 4B, 4C and 4F that are incurred (and/or received) as a result of such sublicense and/or Development Partner’s subsequent development and commercialization of such Products under such sublicense.  Such a sublicense may include a license to make, use and receive the Licensed Materials, Wisconsin Materials or Derivative Materials, and to develop, make, have made, use, distribute, sell, import and offer for sale Products, in each case solely to the extent permitted by this Section 2C(i)(c), and shall state the Licensed Materials, Wisconsin Materials, and Derivative Materials, and any Products, must be destroyed within thirty (30) days of the expiration or termination of the sublicense agreement.  WARF shall have the right to disapprove of a commercial sublicense with a Development Partner only if it reasonably believes that Licensee, Affiliates, or Geron have not previously invested at least [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] in the development of the Product that is the subject of such sublicense, or that the rights extended under such sublicense are not reasonably necessary for the development or commercialization of the licensed Product.  If WARF does not inform Licensee in writing of its disapproval and the reasons for it within fifteen (15) business days after Licensee informs WARF of the proposed terms, WARF shall be deemed to have approved them.  For sake of clarity, no right or license may be extended to a Development Partner to research, develop and/or commercialize any Product that was not initially substantially developed by Licensee, an Affiliate or Geron.  Licensee will not receive from any Development Partner any payments or any non-cash consideration in exchange for the grant of a sublicense hereunder that is not fully accounted for under this Section 2C and Section 4C below.

(d)  To Corning Incorporated to enable Corning to sell surfaces, glassware and plasticware for the growth of pluripotent stem cells (“Corning Surfaces”) developed and tested by Corning under the Collaboration and License Agreement between Corning and Geron, effective as of June 15, 2006, amended and restated as of August 24, 2012, which will be assigned to Licensee as of closure of the Asset Contribution Agreement between Licensee and Geron (the “Corning Collaboration and License Agreement”).  Such sublicense: (i) shall be solely for the performance of Corning’s activities under the Corning Collaboration and License Agreement, and (ii) shall not include any right to transfer a sublicense under the Licensed Patents to Corning customers with the purchase of Corning Surfaces.  In consideration of the rights granted herein, Licensee agrees to pay to WARF [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of all consideration (actual and in kind) received by Licensee from Corning that is the result of or covers any invention made as a part of the Development Partnership Agreement (including without limitation up-front license fees, annual license maintenance fees, milestone payments, royalty payments, equity ,and share of profits, but excluding any payments received to fund research under the development partnership).  Such percentage shall be reduced to [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] if the consideration received from Corning and to be paid to WARF was also paid by Corning in exchange for a sublicense to other intellectual property owned or controlled by Licensee required for the purposes of the development partnership.  In both cases, such payment shall continue until such time as none of the sublicensed Licensed Patents remains enforceable, unless this Agreement is terminated earlier as provided herein.

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(ii)               Any agreement granting a sublicense under this Section 2C shall contain terms and conditions no less restrictive than those set forth in this Agreement, and state that the sublicense is subject to the termination of this Agreement; that further sublicensing is prohibited; that the sublicensee is not authorized to transfer any Licensed Materials, Derivative Materials or Wisconsin Materials, or Products, or use them for any purpose outside that permitted by the sublicense; and that the sublicensee will not use Licensed Materials, Derivative Materials or Wisconsin Materials to perform any of the following experiments: (a) intermixing of Licensed Materials, Derivative Materials or Wisconsin Materials with an intact embryo, either human or nonhuman; (b) implanting Licensed Materials, Derivative Materials or Wisconsin Materials, or products of Licensed Materials, Derivative Materials or Wisconsin Materials, in a uterus; or (c) attempting to make whole embryos by any method.  Licensee shall require that its sublicensee(s) comply with all requirements, restrictions, limitations and obligations, and acknowledge all limitations of warranties provided in this Agreement, including without limitation those in Sections 2C, 5-7, and 12-15, of this Agreement (to the extent applicable to the work under the sublicense) and Licensee shall have responsibility for the performance of any sublicensee under such sublicense.  Licensee shall provide to WARF, in confidence, a summary of any sublicense agreement under this Section 2C within thirty (30) days after execution of such sublicense agreement subject to the obligation, however, in the case of commercial sublicenses to Development Partners to have earlier provided the proposed terms as required above in Section 2C(i)(c).

		D.	License to WARF.

Licensee hereby grants, and shall require its sublicensee(s) to grant, to WARF a world-wide, nonexclusive, royalty-free, irrevocable, paid-up license, with the right to grant sublicenses, to the University of Wisconsin, the WiCell Research Institute and the Morgridge Institute for Research, to make, have made, use and otherwise practice Developments for Non-Commercial Research Purposes.

		Section 3.	Reporting.

A.                Within [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of the Effective Date of this Agreement, Licensee shall submit to WARF a Development Plan describing its intended development efforts relating to Products.  If WARF does not inform Licensee of its disapproval of such Development Plan within thirty (30) days, the Development Plan shall be deemed accepted and shall be incorporated hereto as Appendix E. The Development Plan shall include a timeline indicating Licensee’s internal operating estimate of when Licensee will [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission]. Licensee shall diligently develop, manufacture, market and sell Products in the Licensed Field throughout the term of this Agreement.  Such activities shall include, without limitation, those activities listed in the “Development Plan”.  Licensee agrees that it shall take all commercially reasonable steps to meet the development program as set forth therein.

 

B.                 Beginning in June 2014 and until the Date of First Commercial Sale, Licensee shall provide WARF with a semi-annual written Development Report summarizing Licensee’s (and those of its sublicensee(s)’) development activities since the last Development Report and any necessary adjustments to the Development Plan.  Licensee agrees to provide each Development Report to WARF on or before [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] from the end of each semi-annual period ending June 30 and December 31 for which a report is due, and shall set forth in each Development Report sufficient detail to enable WARF to ascertain Licensee’s progress toward the requirements of the Development Plan. WARF reserves the right to audit Licensee’s and its sublicensee(s)’s records relating to the development activities required hereunder.  Such record keeping and audit procedures shall be subject to the procedures and restrictions set forth in Section 6 for auditing the financial records of Licensee.

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C.                 Licensee acknowledges that any failure by Licensee to make commercially reasonable efforts to develop, manufacture, market and sell Products, or to make timely submission to WARF of any Development Report, or the providing of any false information to WARF regarding Licensee’s development activities hereunder, shall be a material breach of the terms of this Agreement, subject to the right to cure under Section 7.

		Section 4.	Consideration.

 

		A.	License Fee.

Licensee shall pay to WARF a license fee of [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] due and payable within [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of the Effective Date.

		B.	Royalty.

(i)            In addition to the Section 4A license fee, Licensee (and its sublicensees) shall pay to WARF, as “earned royalties,” a royalty calculated as a percentage of the Net Sales of Products in accordance with the terms of this Agreement.  The royalty is deemed earned as [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission].  The royalty rate shall remain fixed while this Agreement is in effect according to the following schedule:

 

(ii)            For Therapeutic Products the royalty is set at a rate of:

 

[*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission]

 

(iii)            For Related Therapeutic Products the royalty is set at a rate of:

(iv)            For Research Products, the royalty is set at a rate of [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of Net Sales.

(v)            For Diagnostic Products, the royalty is set at a rate of [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of Net Sales.

(vi)            If Licensee is required to make payments to a third party (who is not an Affiliate or Development Partner) for a license or similar right to such third party’s patents, in the absence of which right or license Licensee could not legally make, use or sell Products, then the royalty payable under this Section 4B shall be reduced by [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] for each additional [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of royalties payable to such third parties on that Product; provided, however, that the adjusted royalty rate to WARF will be no less than [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of the applicable royalty rate payable to WARF under this Agreement for such Products.

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(vii)            In the event that the sale, lease, or other transfer by Licensee of Products under this Agreement also requires payment to WARF of royalties under any other agreement between WARF and Licensee, the cumulative earned royalties owed to WARF for that Product under all such agreements shall not exceed the single highest royalty as set forth in those agreements.  Licensee shall pay to WARF royalties under all such agreements individually and on a pro rata basis.  (For example, if Licensee owes to WARF a [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] earned royalty under this Agreement and a [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] earned royalty under a separate agreement, the cumulative royalties owed to WARF shall be [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission], but shall be paid proportionately under each agreement in payments of [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] under this Agreement and [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] on the other.)

(viii)            Given the particular Licensed Patents of this Agreement, rather than requiring Licensee to pay earned royalties under a Licensed Patent that is a pending patent application which has not issued as of the Effective Date (“Licensed Patent Application”), WARF is willing to permit Licensee to defer such amounts as follows [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission].

C.                  [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission]

		D.	Minimum Royalty.

Starting in calendar year 2014, Licensee shall pay to WARF a minimum royalty of [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] per calendar year or part thereof during which this Agreement is in effect against which any earned royalty paid for the same calendar year will be credited.  The minimum royalty for a given year shall be due at the time payments are due for the calendar quarter ending on December 31.  It is understood that the minimum royalties will apply on a calendar year basis, and that sales of Products requiring the payment of earned royalties made during a prior or subsequent calendar year shall have no effect on the annual minimum royalty due WARF for any other given calendar year.

		E.	Patent Fees and Costs.

Licensee shall pay to WARF [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] toward reimbursement of the costs associated with preparing, filing and maintaining the Licensed Patents, which shall be due on the same date as the License Fee of Section 4A is due.

		F.	Milestones.

Licensee shall pay to WARF the amounts detailed below within [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] days of the first achievement of the corresponding milestones for each Product developed by Licensee (or by a sublicensee):

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(i)            [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] upon first dosing of a human patient with a Product.

(ii)            [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] upon first dosing of a human patient with a Product in a pivotal clinical trial designed to provide statistically significant safety and efficacy data to support the filing of a biologics license application or for registration of a Product with the FDA, EMA or similar regulatory bodies in a nation listed as one of the top [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] world pharmaceutical markets by IMS Health or a similar broadly recognized authority in pharmaceutical market analysis.

(iii)            [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] upon receipt of marketing authorization for a Product from the FDA, EMA or similar regulatory bodies in a nation listed as one of the top [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] world pharmaceutical markets by IMS Health or a similar broadly recognized authority in pharmaceutical market analysis.

Notwithstanding the foregoing, in the event the indication that is the subject of the clinical trial set forth in Section 4F(ii) or the marketing authorization set forth in 4F(iii) has been designated by the applicable regulatory authority as an orphan indication, the corresponding milestone payment set forth in Section 4F(ii) or Section 4F(iii) shall be reduced by [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission]; provided however that a second payment of [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of the applicable milestone payment shall be due upon the first achievement of the corresponding milestone for that Product in a non-orphan indication.

		G.	Accounting; Payments.

(i)            Amounts owing to WARF under Section 4B and 4C or 2C(d) of this Agreement shall be paid on a quarterly basis, with such amounts due and received by WARF on or before the forty-fifth (45th) day following the end of the calendar quarter ending on March 31, June 30, September 30 or December 31 in which such amounts were earned.  [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission].

(ii)            Except as otherwise directed, all amounts owing to WARF under this Agreement shall be paid in U.S. dollars.  All royalties owing with respect to the Net Sales and other fees are stated in currencies other than U.S. dollars shall be converted at the rate shown in the Federal Reserve Noon Valuation ‐ Value of Foreign Currencies on the day preceding the payment.  WARF is exempt from paying income taxes under U.S. law.  Therefore, all payments due under this Agreement shall be made without deduction for taxes, assessments, or other charges of any kind which may be imposed on WARF by any government outside of the United States or any political subdivision of such government with respect to any amounts payable to WARF pursuant to this Agreement.  All such taxes, assessments, or other charges shall be assumed by Licensee or its sublicensees.

(iii)            A full accounting showing how any amounts owing to WARF under Section 4B have been calculated shall be submitted to WARF on the date of each such payment.  Such accounting shall be on a per‐country and Product line, model or tradename basis and shall be summarized on the form shown in Appendix C of this Agreement.  In the event no payment is owed to WARF, a statement setting forth that fact shall be supplied to WARF.

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		Section 5.	Certain Warranties.

A.                WARF warrants that it has the right to grant the licenses granted to Licensee in this Agreement.  Nothing in this Agreement shall, however, be construed as:  (i) a warranty or representation by WARF or Licensee as to the validity or scope of any of the Licensed Patents; (ii) a warranty or representation that anything made, used, sold or transferred under the license granted in this Agreement will or will not infringe patents of third parties; (iii) an obligation to furnish any assistance, or know-how not provided in the Licensed Patents or any materials or services other than those specified in this Agreement; or (iv) an obligation to file any patent application or secure or maintain any patent right.

B.                EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, WARF MAKES NO OTHER REPRESENTATIONS, EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, AND ASSUMES NO RESPONSIBILITIES WHATSOEVER WITH RESPECT TO THE MERCHANTIBILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OR THE NON-INFRINGEMENT OR USE OF ANY PRODUCT, OR WITH RESPECT TO THE USE, SALE OR OTHER DISPOSITION BY LICENSEE, ITS SUBLICENSEE(S), OR THEIR VENDEES OR OTHER TRANSFEREES, OF PRODUCTS INCORPORATING OR MADE BY USE OF THE INVENTIONS LICENSED, UNDER THIS AGREEMENT.

C.                 TO THE MAXIMUM EXTENT PERMITTED BY LAW, IN NO EVENT SHALL WARF OR ITS TRUSTEES, DIRECTORS, OFFICERS AND EMPLOYEES (INCLUDING WITHOUT LIMITATION ANY INVENTORS OF THE LICENSED PATENTS) BE LIABLE FOR ANY INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ECONOMIC DAMAGES OR INJURY TO PROPERTY AND LOST PROFITS, REGARDLESS OF WHETHER SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND NOTWITHSTANDING THE FAILURE OF THE ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.

D.                 Licensee represents and warrants that Products produced under the license granted herein shall be manufactured substantially in the United States as required by 35 U.S.C § 204 [for clarity, such requirement shall apply only to Products utilizing Licensed Patents or Wisconsin Materials whose development was funded at least in part by the Federal government] and applicable regulations of Chapter 37 of the Code of Federal Regulations.

		Section 6.	Recordkeeping.

A.                Licensee and its sublicensee(s) shall keep books and records sufficient to verify the accuracy and completeness of Licensee’s and its sublicensee(s)’s accounting referred to above, including without limitation inventory, purchase and invoice records relating to any Products sold under this Agreement.  In addition, Licensee shall keep books and records sufficient to verify the accuracy and completeness of Licensee’s Development Reports.  Such documentation may include, but is not limited to, invoices for studies, laboratory notebooks, internal job cost records, and filings made to the Internal Revenue Department to obtain tax credit, if available, for research and development.  All such books and records shall be preserved for a period not less than [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] years after they are created during and after the term of this Agreement.

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B.                 Licensee and its sublicensee(s) shall take all steps reasonably necessary so that WARF may, within [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] days of its request, review Licensee’s books and records to allow WARF to verify the accuracy of Licensee’s Development Reports, the development and royalty reports of its sublicensee(s), and the payments made to WARF.  Such review will be performed no more than annual and by an attorney or registered CPA and scientific expert designated by WARF at WARF’s expense upon reasonable notice and during regular business hours.

C.                  If a royalty payment deficiency is determined, Licensee and its sublicensee(s), as applicable, shall pay the royalty deficiency outstanding within [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] days of receiving written notice thereof, plus interest on outstanding amounts as described in Section 4G(i).  If a royalty payment deficiency for a calendar year exceeds the lesser of [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of the royalties paid for that year or [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission], then Licensee or its sublicensee(s) shall be responsible for paying WARF’s out‐of‐pocket expenses incurred with respect to such review.

		Section 7.	Term and Termination.

A.                The term of this Agreement shall begin on the Effective Date and continue until (i) with respect to the Licensed Patents, the expiration of the last to expire Licensed Patent, unless otherwise earlier terminated as provided herein and (ii) with respect to the Wisconsin Materials (per the attached Wisconsin Materials Addendum), until this Agreement is terminated by either Party as provided herein.

B.                  Licensee may terminate this Agreement at any time by giving at least [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] days written and unambiguous notice of such termination to WARF. WARF may terminate this Agreement if the payment of earned royalties under Section 4B, once begun, ceases for more than [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission].

C.                  WARF may terminate this Agreement prior to the Date of First Commercial Sale by giving Licensee at least [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission]days written notice if Licensee and/or its Collaborators, Contract Service Providers and Development Partners fail to spend at least [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] per year to develop Products in [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] successive calendar years.

D.                 If Licensee at any time (i) defaults in the timely payment of any monies due to WARF; or the timely submission to WARF of any report, or (ii) commits any breach of any other covenant herein contained, and Licensee fails to remedy any such breach or default within [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] days after written notice thereof by WARF, or if Licensee commits any act of bankruptcy, becomes insolvent, is unable to pay its debts as they become due, files a petition under any bankruptcy or insolvency act, or has any such petition filed against it which is not dismissed within [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission]days, or if Licensee or a sublicensee offers any component of the Licensed Patents, Wisconsin Materials or Licensed Materials to its creditors, WARF may, at its option, terminate this Agreement by giving notice of termination to Licensee.

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E.                 Upon termination of this Agreement, the licenses granted herein shall immediately terminate.  In the event of termination under Section 7B or 7C, Licensee shall have [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] days to cease all activities involving the use of Licensed Materials, Wisconsin Materials and Derivative Materials for any purpose, and shall destroy all Licensed Materials, Wisconsin Materials and Derivative Materials in its possession.  Licensee and its sublicensee(s) shall remain obligated to pay any outstanding amounts owed as of the date of termination and all such amounts shall be paid within forty-five (45) days of termination.

F.                  For clarity, the obligations of Sections 5B, 5C, 11, 13, 14, 16, and 18 shall survive any termination of this Agreement.

		Section 8.	Assignability; Change of Control; Affiliates.

Licensee shall not assign or transfer this Agreement, nor any of the rights granted herein, without the prior written consent of WARF (which shall not be unreasonably withheld), except pursuant to a sale of all or substantially all of the assets relating to Products.  Licensee shall notify WARF in writing at least [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] days in advance of any such assignment and, with respect to a transfer of this Agreement to any non-Affiliate, pay to WARF a fee of [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] to allow the transfer of the license granted herein to that non-Affiliate to whom control has been transferred, within [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] days after the occurrence of such event.  For clarity, in no event shall a bona fide financing transaction, or series of bona fide financing transactions, of Licensee including one or more financial investors be deemed to be a sale of the assets of Licensee and no transfer fee under this Section 8 shall be due to WARF in such event.

In the event that an Affiliate who has previously agreed to sign on and be bound by the terms and obligations of this Agreement should subsequently cease to be an Affiliate of Asterias Biotherapeutics through dilution of Asterias’ ownership to <50% through a series of bona fide financing transactions, such Affiliate’s rights under this Agreement shall survive such Affiliate cessation date for a period of [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission], during which WARF and such Affiliate shall negotiate a direct license agreement with terms substantially identical to those herein, except for: (i) division of the Annual Minimum Royalty due under Section 4D, which division shall be worked out between Asterias and such Affiliate and this Agreement will be amended to reflect such division, and (ii) any other changes as mutually agreed upon between such Affiliate and WARF.  For clarity, no transfer fee under this Section 8, sublicense fee under Section 4C (except for any amounts that may remain outstanding under this Agreement), upfront license fee, or additional patent fee shall be due to WARF for the establishment of such a direct license agreement with such Affiliate assuming such foregoing amounts have been satisfied under this Agreement and no additional intellectual property or proprietary rights have been added to such to-be-negotiated license agreement.

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WARF Agreement No. 13-00300

 

		Section 9.	Contest of Validity.

A.                 Licensee and its sublicensee(s) must provide WARF at least [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] months prior written notice before filing any action that contests the validity of any Licensed Patent during the term of this Agreement.

B.                  If Licensee or its sublicensee(s) files any action contesting the validity of any Licensed Patent, the filing party shall pay [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission].  Moreover, should the outcome of such contest determine that any claim of a Licensed Patent challenged by the filing party is valid and would be infringed by a Product sold by the filing party if not for the license granted by this Agreement, such filing party shall thereafter, and for the remaining term of this Agreement [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission].

C.                  If Licensee or its sublicensee(s) contests the validity of any Licensed Patent during the term of this Agreement, Licensee shall pay (and shall require its sublicensee(s) to agree to pay) to WARF all royalties due under the Agreement during the period of challenge.  For the sake of clarity, Licensee or the sublicensee shall not pay such amounts into any escrow or other account, but directly to WARF.

		Section 10.	Enforcement.

WARF intends to protect the Licensed Patents against infringers, or otherwise act to eliminate infringement when, in WARF's sole judgment and discretion, such action may be reasonably necessary, proper and justified.  In the event that Licensee or its sublicensee believes there is infringement of any Licensed Patents, Licensee shall provide WARF with notification and reasonable evidence of such infringement.  If WARF takes action to remedy the infringement, Licensee or such sublicensee agrees to provide reasonable assistance to WARF as requested by WARF and at WARF’s expense.

		Section 11.	Indemnification and Insurance.

A.                 Licensee and its sublicensee(s) shall, at all times during the term of this Agreement and thereafter, indemnify, defend and hold WARF, WiCell, the Morgridge Institute for Research and the University of Wisconsin (the “University”), and their respective trustees, directors, officers, shareholders and employees (including without limitation any inventors of the Licensed Patents) (each, an “Indemnitee”) harmless against all liabilities, demands, damages, settlements, suits, claims, proceedings, costs and expenses, including legal expenses and reasonable attorneys fees, arising out of or relating to the death of or injury to any person or persons or any damage to property, due to the sale, marketing, use, or manufacture of Products, Licensed Materials, Wisconsin Materials, or any Derivative Materials or Developments by Licensee and all sublicensees hereunder.  WARF at all times reserves the right to select and retain counsel of its own to defend WARF’s interests in any such proceeding.

B.                Licensee warrants that it now maintains and will continue to maintain liability insurance coverage reasonably appropriate to the risk involved in use, sale, marketing, and manufacture of Products, the Licensed Materials, Wisconsin Materials, and any Derivative Materials, or the performance of Services, under this Agreement, and that such insurance coverage is sufficient to cover WARF and the inventors of the Licensed Patents, the Wisconsin Materials and Licensed Materials as additional insureds.  Upon WARF’s request, Licensee will present evidence to WARF that such coverage is being maintained.

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WARF Agreement No. 13-00300

 

		Section 12.	Use of Names.

Neither party shall use the other’s name, and Licensee and its sublicensee(s) shall not use the name of any inventor of the Licensed Patents, or the name of WARF, WiCell Research Institute, or the University, in any form of publicity without the prior written approval of the entity or person whose name is being used, except where a disclosure is required by any applicable law or the rules of any securities exchange.  Notwithstanding the foregoing, WARF shall have the right to disclose to existing and potential licensees the fact that WARF has entered into this Agreement with Licensee.

		Section 13.	Confidentiality.

A.            Both parties agree to keep any information identified as confidential by the disclosing party, confidential using methods at least as stringent as each party uses to protect its own confidential information.  Confidential information shall include, without limitation, this Agreement and its terms, as well as any information provided to WARF under Section 3.  Except as may be authorized in advance in writing by WARF, Licensee shall only grant access to WARF’s Confidential Information to its sublicensee(s) and those employees of Licensee and its sublicensee(s) involved in research relating to the Licensed Patents.  Licensee shall require its sublicensee(s) and all such employees to be bound by terms of confidentiality no less restrictive than those set forth in this Section 13.  The confidentiality and use obligations set forth above apply to all or any part of information disclosed hereunder except to the extent that:

(i)                  the receiving party can show by written record that they possessed the information prior to its receipt from the disclosing party;

(ii)                 the information was already available to the public or became so through no fault of the receiving party;

(iii)               the information is subsequently disclosed to the receiving party by a third party that has the right to disclose it free of any obligations of confidentiality; or

(iv)               five (5) years have elapsed from the expiration or termination of this Agreement.

B.                 Nothing contained in this Section 13 shall be construed to limit or preclude WARF from negotiating or entering into any agreements with third parties under terms and conditions similar to that set forth in this Agreement.

		Section 14.	United States Government Interests.

It is understood that if the United States Government (through any of its agencies or otherwise) has funded research, during the course of or under which any of the inventions of the Licensed Patents were conceived or made, the United States Government is entitled, as a right, under the provisions of 35 U.S.C. § 200‐212 and applicable regulations of Chapter 37 of the Code of Federal Regulations, to a nonexclusive, nontransferable, irrevocable, paid‐up license to practice or have practiced the inventions of the Licensed Patents for governmental purposes.  Any license granted to Licensee or any of its sublicensees under this Agreement shall be subject to such right.

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WARF Agreement No. 13-00300

 

		Section 15.	Patent Marking.

Licensee and its sublicensee(s) shall mark all service agreements, Products or product packaging with the appropriate patent number reference in compliance with the requirements of the laws of the United States of America, including specifically, 35 U.S.C. § 287.

		Section 16.	Miscellaneous.

A.                This Agreement shall be governed by and construed in all respects in accordance with the laws of the State of Wisconsin, without reference to its conflicts of laws principles.

B.                 The parties hereto are independent contractors and not joint venturers or partners.

C.                  If Asterias or any of its Affiliates also has rights under the BioTime Research License, the terms and obligations of this Agreement shall control.

D.                 If the enforcement of any provisions of this Agreement are or shall come into conflict with the laws or regulations of any jurisdiction or any governmental entity having jurisdiction over the parties or this Agreement, those provisions shall be deemed automatically deleted, if such deletion is allowed by relevant law, and the remaining terms and conditions of this Agreement shall remain in full force and effect.  If such a deletion is not so allowed or if such a deletion leaves terms thereby made clearly illogical or inappropriate in effect, the parties agree to substitute new terms as similar in effect to the present terms of this Agreement as may be allowed under the applicable laws and regulations.

E.                  WARF and Licensee have each been represented by counsel who participated in the preparation of this Agreement.  This Agreement reflects a negotiated compromise between the parties.  Neither party shall be considered to be the drafter of this Agreement or any of its provisions for the purpose of any statute, case law or rule of interpretation or construction that would or might cause any provision to be construed against the drafter of this Agreement.  The Section headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.

F.                  This Agreement is not intended to be for the benefit of and shall not be enforceable by any third party.  Nothing in this Agreement, express or implied, is intended to or shall confer on any third party any rights (including third-party beneficiary rights), remedies, obligations or liabilities under or by reason of this Agreement.  This Agreement shall not provide third parties with any remedy, claim, reimbursement, cause of action or other right in excess of those existing without reference to the terms of this Agreement.  No third party shall have any right, independent of any right that exists irrespective of this Agreement, to bring any suit at law or equity for any matter governed by or subject to the provisions of this Agreement.

G.                  Licensee acknowledges and agrees that damages may not be an adequate remedy in the event of a breach of this Agreement by Licensee.  Licensee therefore agrees that WARF shall be entitled to seek immediate and permanent injunctive relief from a court of competent jurisdiction in addition to any other rights or remedies otherwise available to WARF.

H.                Waiver by either party of a single breach or default, or a succession of breaches or defaults, shall not deprive such party of any right to terminate this Agreement in the event of any subsequent breach or default.

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WARF Agreement No. 13-00300

 

		Section 17.	Notices.

Any notice required to be given pursuant to the provisions of this Agreement shall be in writing and shall be deemed to have been given at the earlier of the time when actually received as a consequence of any effective method of delivery, including but not limited to hand delivery, transmission by telecopier, or delivery by a professional courier service or the time when sent by certified or registered mail addressed to the party for whom intended at the address below or at such changed address as the party shall have specified by written notice, provided that any notice of change of address shall be effective only upon actual receipt.

		(a)	Wisconsin Alumni Research Foundation

Attn:  Contracts Manager

614 Walnut Street

Madison, Wisconsin  53726

		(b)	Asterias Biotherapeutics, Inc.

Attn:  Katharine Spink

230 Constitution Dr.

Menlo Park, CA 94025

		Section 18.	Integration.

This Agreement together with the Wisconsin Materials Addendum, attached hereto, constitutes the full understanding between the parties with reference to the subject matter hereof, and no statements or agreements by or between the parties, whether orally or in writing, except as provided for elsewhere in this Section 18, made prior to or at the signing hereof, shall vary or modify the written terms of this Agreement.  Neither party shall claim any amendment, modification, or release from any provisions of this Agreement by mutual agreement, acknowledgment, or otherwise, unless such mutual agreement is in writing, signed by both parties, and specifically states that it is an amendment to this Agreement.

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WARF Agreement No. 13-00300

 

		Section 19.	Authority.

The persons signing on behalf of WARF and Licensee hereby warrant and represent that they have authority to execute this Agreement on behalf of the party for whom they have signed.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement on the dates indicated below.

WISCONSIN ALUMNI RESEARCH FOUNDATION (“WARF”)

By:       s/Leigh Cagan                          Date:     10/7     , 2013

            Leigh Cagan, Chief Technology Commercialization Officer

ASTERIAS BIOTHERAPEUTICS, INC. (“LICENSEE”)

By:      s/Katharine Spink                          Date:  October 1, 2013

            Katharine Spink, Vice President and Chief Operating Officer

WARF Ref.:  Thomson – P96014US

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WARF Agreement No. 13-00300

APPENDIX A

A.                 “Affiliate” and “Affiliates” mean any entity controlled by Asterias.  As used herein, “control” shall refer to and mean ownership of greater than fifty percent (>50%) or more of the outstanding voting equity of an entity.

 

B.                  “Collaborator” means an academic, non-profit research institution with which Licensee enters into a written agreement pursuant to and solely to the extent permitted by Section 2C for a collaborative project or projects for the further research on and/or development of the Licensed Materials, Wisconsin Materials, Derivative Materials and/or Products in support of Licensee's development or commercialization of one or more Products.

 

C.                  “Contract Service Provider” means a third party with which Licensee enters into a written agreement pursuant to and solely to the extent permitted by Section 2C for the provision of specific services in support of Licensee’s development or of one or more Products on behalf of Licensee or its Collaborator.

 

D.                “Date of First Commercial Sale” means the date when cumulative sales to the retail market of Therapeutic Products exceed [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission].

 

E.                  “Derivative Materials” means any compositions or materials derived by Licensee or its sublicensee(s) from the use of the Wisconsin Materials, or produced by the use of the Wisconsin Materials by Licensee or its sublicensee(s), or which incorporate wholly or partially the Wisconsin Materials, including without limitation, fully or partially differentiated cells or cell lines derived from the Wisconsin Materials by Licensee or its sublicensee(s).

 

F.                 “Development” and “Developments” means (i) Derivative Materials; (ii) any inventions, discoveries or developments, whether patentable, that are conceived of, reduced to practice, discovered, tested or developed through the use of the inventions of the Licensed Patents, Wisconsin Materials or Derivative Materials by Licensee or its sublicensee(s); and (iii) any compositions, products or other materials of Licensee or its sublicensee(s) in which the Wisconsin Materials or Derivative Materials were used in any way in their discovery or testing.

 

G.                 “Development Partner” means a third party with which Licensee enters into a written agreement pursuant to and solely to the extent permitted by Section 2C for the further development and/or commercialization of Products initially substantially developed by Licensee.

 

H.                 “Development Report” means the written report provided under Section 3 describing each Development and Product to be patented or commercialized by Licensee or a sublicensee.

 

I.                  “Diagnostic Products” means products or services that (i) are used in the diagnosis, prognosis, screening or detection of disease in humans, and (ii) (a) employ, or are in any way produced or manufactured by the practice or use of the inventions of the Licensed PatentsDerivative Materials or Wisconsin Materials, and/or (b) would otherwise constitute infringement of any claims of the Licensed Patents.

 

J.                    “Internal Research” means research conducted internally by Licensee at Licensee’s facilities.

 

	K.	“Licensed Field” is limited to the field of Products.

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WARF Agreement No. 13-00300

 

L.                  “Licensed Materials” means primate (including human) embryonic stem cells covered by the Licensed Patents and which meet the following conditions:

 

(i)                For embryonic stem cells created prior to April 26, 2005, the embryonic stem cell must be either: (1) listed on the NIH Human Embryonic Stem Cell Registry at http://escr.nih.gov; or (2) derived from excess embryos created for the purpose of in vitro fertilization with appropriate consent of the donor couple and not for the purpose of creating embryonic stem cells; or (3) derived from embryos created specifically for research purposes either by in vitro fertilization or by somatic cell nuclear transfer, for which the following additional conditions apply:  (a) the embryo may not have been maintained in vitro for more than 14 days; (b) the gamete donor(s) and somatic cell donor (if any) made the donation without payment beyond reimbursement for reasonable expenses associated with donation; (c) in the case of egg donation, the donor was fully informed of the risks to herself; (d) the gamete donor(s) and somatic cell donor (if any) were fully informed of the purposes to which their donated materials would be put; (e) the research could not be done equally well using surplus IVF embryos originally created for reproductive purposes; (f) the research protocol, including gamete collection, somatic cell collection, embryo management and stem cell derivation is approved by an appropriate Institutional Review Board; and (g) protections are in place to prevent misappropriation of embryos created specifically for research.

(ii)                For embryonic stem cells created from embryos created after April 26, 2005, the embryonic stem cells must be derived from embryos and under conditions in compliance with the “Guidelines for Human Embryonic Stem Cell Research” established by the National Research Council Institute of Medicine of the National Academies (the “NAS Guidelines”).

(iii)                For embryonic stem cells created after April 26, 2005 from embryos generated prior to April 26, 2005, and which do not meet the NAS Guidelines, the embryonic stem cells must meet one of the conditions set forth in paragraph (i) above and be created using protocols substantially in compliance with the requirements of the NAS Guidelines.

M.               “Licensed Patents” means those patents and patent applications listed on Appendix B attached hereto and all foreign equivalents owned by or licensed to WARF.

 

N.                 “Licensed Territory” means worldwide.

 

O.                 “Net Sales” [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission]

 

In the event that a Product is sold in combination with another product, component or service for which no royalty would be due hereunder if sold separately, Net Sales from such combination sales for purposes of calculating the amounts due under Section 4B shall be calculated by multiplying the Net Sales of the combination product by the fraction A/(A + B), where “A” is the average selling price during the previous calendar quarter of the Product sold separately and “B” is the average selling price during the previous calendar quarter of the product(s), component(s) and/or service(s) combined therewith.  Where a Product is sold only as a component of a larger product or system and not as a stand-alone product, then the Net Sales amount shall be deemed to be the amount received by Licensee or sublicensees for the entire product containing the Product multiplied by a number, the numerator of which is Licensee’s (or the sublicensee’s) costs for the Product and the denominator of which is Licensee’s (or the sublicensee’s) costs for the entire product sold by Licensee (or the sublicensee) that includes the Product.

 

P.               “Non-Commercial Research Purposes” means the use for internal academic research purposes or other internal not-for-profit or scholarly purposes not involving the use of the technology: (1) to perform services for a fee; or (2) for the production or manufacture of products for sale to third parties.

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WARF Agreement No. 13-00300

 

Q.                 “Products” means any Research Products, Diagnostic Products, Therapeutic Products, and Related Therapeutic Products.

 

R.                 “Related Therapeutic Product” means products or services that (i) are used in the treatment of disease in humans, and (ii) are in any way produced or manufactured using, and/or incorporate any Wisconsin Material or

Derivative Material, but do not employ the practice or otherwise constitute infringement of any [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of the Licensed Patents.

S.                 “Research products” means products or services that (i) are used as research tools, including in drug discovery and development, and (ii) (a) employ, or are in any way produced or manufactured by, the practice or use of the inventions of the Licensed Patents, Derivative Materials or the Wisconsin Materials, and/or (b) would otherwise constitute infringement of any claims of the Licensed Patents.

 

T.                 “Therapeutic Products” means products or services that (i) are used in the treatment of disease in humans, and (ii) (a) employ, or are in any way produced or manufactured by, the practice or use of a [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of the Licensed Patents, and/or (b) would but for this Agreement otherwise constitute infringement of any [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] of the Licensed Patents.

 

U.                 [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission]

V.                 “Wisconsin Materials” is defined in the attached Wisconsin Materials Addendum.

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WARF Agreement No. 13-00300

LICENSED PATENTS

APPENDIX B

	
REFERENCE NUMBER

	
COUNTRY

	
APPLICATION SERIAL NUMBER

	
FILING DATE

	
PATENT NUMBER

	
 

	
 

	
 

	
 

	
 

	
METHOD OF IN VITRO DIFFERENTIATION OF TRANSPLANTABLE NEURAL PRECURSOR CELLS FROM PRIMATE EMBRYONIC STEM CELLS

	
(Ian Duncan, James Thomson, Su-Chun Zhang)

	
P01258US

	
UNITED STATES

	
09/970382

	
10/03/2001

	
6887706

	
P04277US

	
UNITED STATES

	
10/928805

	
08/27/2004

	
7588937

	
P07050US

	
UNITED STATES

	
11/594455

	
11/08/2006

	
7972850

	
P07445US

	
UNITED STATES

	
11/932582

	
10/31/2007

	
8153424

	
P09335IL

	
ISRAEL

	
198450

	
08/27/2004

	
198450

	
 

	
 

	
 

	
 

	
 

	
PRIMATE EMBRYONIC STEM CELLS

	
(James Thomson)

	
P02115US

	
UNITED STATES

	
09/982637

	
10/18/2001

	
7029913

	
P05206US

	
UNITED STATES

	
11/036245

	
01/14/2005

	
7582479

	
P08333US

	
UNITED STATES

	
12/047135

	
03/12/2008

	
7781216

	
P96014US

	
UNITED STATES

	
08/591246

	
01/18/1996

	
5843780

	
P98222US

	
UNITED STATES

	
09/106390

	
06/26/1998

	
6200806

	
 

	
 

	
 

	
 

	
 

	
SERUM FREE CULTIVATION OF PRIMATE EMBRYONIC STEM CELLS

	
(James Thomson)

	
P99275US

	
UNITED STATES

	
09/522030

	
03/09/2000

	
7005252

	
P03122US

	
UNITED STATES

	
10/430497

	
05/06/2003

	
7217569

	
W05007US

	
UNITED STATES

	
11/078737

	
03/11/2005

	
7439064

	
W09003US

	
UNITED STATES

	
12/489978

	
06/23/2009

	
 

	
P07322AU

	
AUSTRALIA

	
2007200575

	
03/02/2001

	
2007200575

	
 

	
 

	
 

	
 

	
 

	
METHOD OF MAKING EMBRYOID BODIES FROM PRIMATE EMBRYONIC STEM CELLS

	
(James Thomson, Jennifer Swiergiel, Vivienne Marshall)

	
P99276US

	
UNITED STATES

	
09/510444

	
02/21/2000

	
6602711

	
P03410US

	
UNITED STATES

	
10/632399

	
05/06/2003

	
7220584

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WARF Agreement No. 13-00300

APPENDIX C

WARF ROYALTY REPORT

	
Licensee:

	
  

		
Agreement No:

	
  

	 				
	
Inventor:

	
  

		
WARF Ref. #:

	
  P

	 				
	
Period Covered: From:

	
/                  /

		
Through:

	
/              /

	 				
	
Prepared By:

	
   

		
Date:

	
  

	 				
	
Approved By:

	
  

		
Date:

	
  

 

If license covers several major Product lines, please prepare a separate report for each line, and combine all Product lines into a summary report.

 

	
Report Type:

	
q  Single Product Line Report:

	
  

	 		
	
 

	
q  Multiproduct Summary Report:  Page 1 of ______ Pages

	 	  
	
 

	
q  Product Line Detail.  Line:                                    Tradename:                           Page:

	 		
	
Report Currency:

	
q  U. S. Dollars      q  Other

	
  

	
 

	
Gross

	
* Less:

	
Net

	
Royalty

	
Period Royalty Amount

	
Country

	
Sales

	
Allowances

	
Sales

	
Rate

	
This Year

	
Last Year

	
U.S.A.

	
 

	
 

	
 

	
 

	
 

	
 

	
Canada

	
 

	
 

	
 

	
 

	
 

	
 

	
Europe:

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Japan

	
 

	
 

	
 

	
 

	
 

	
 

	
Other:

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
TOTAL:

	
 

	
 

	
 

	
 

	
 

	
 

Total Royalty: _______________  Conversion Rate: ____________  Royalty in U.S. Dollars:  $

The following royalty forecast is non-binding and for WARF’s internal planning purposes only:

Royalty Forecast Under This Agreement:  Next Quarter:__________  Q2:__________  Q3:__________  Q4:__________

* On a separate page, please indicate the reasons for returns or other adjustments if significant.

Also note any unusual occurrences that affected royalty amounts during this period.

To assist WARF’s forecasting, please comment on any significant expected trends in sales volume.

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APPENDIX D

DEVELOPMENT REPORT

	A.	Date development plan initiated and time period covered by this report.

	B.	Development Report (4-8 paragraphs).

1.            Activities completed since last report including the object and parameters of the development, when initiated, when completed and the results.

2.            Activities currently under investigation, i.e., ongoing activities including object and parameters of such activities, when initiated, and projected date of completion.

	C.	Future Development Activities (4-8 paragraphs).

1.            Activities to be undertaken before next report including, but not limited to, the type and object of any studies conducted and their projected starting and completion dates.

2.            Estimated total development time remaining before a Product will be commercialized.

	D.	Changes to initial development plan (2-4 paragraphs).

1.            Reasons for change.

2.            Variables that may cause additional changes.

	E.	Items to be provided if applicable:

1.            Information relating to Product that has become publicly available, e.g., published articles, competing products, patents, etc.

2.            Development work being performed by third parties other than Licensee to include name of third party, reasons for use of third party, planned future uses of third parties including reasons why and type of work.

3.            Update of competitive information trends in industry, government compliance (if applicable) and market plan.

PLEASE SEND DEVELOPMENT REPORTS TO:

Wisconsin Alumni Research Foundation

Attn.:  Contract Manager

614 Walnut Street

Madison, WI 53726

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APPENDIX E

DEVELOPMENT PLAN

(To be provided by Licensee within [*Certain information has been omitted under a request for confidential treatment, and the omitted information has been filed with the Commission] months of Effective Date)

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WARF Agreement No. 13-00300

WARF Agreement No. 13-00300A

WISCONSIN MATERIALS ADDENDUM

This Addendum is made effective the 1st day of October, 2013, by and between Wisconsin Alumni Research Foundation (“WARF”), a nonprofit Wisconsin corporation, and Asterias Biotherapeutics Incorporated (“Licensee”), a corporation organized and existing under the laws of Delaware.

WHEREAS, WARF and Licensee have entered into License Agreement No. 13-00300, effective October 1, 2013 (the “Patent Rights Agreement”), granting Licensee the right under certain Licensed Patents to make, use and receive Licensed Materials for use in Internal Research;

WHEREAS, WARF also holds certain rights in human embryonic stem cell lines developed by James A. Thomson of the University of Wisconsin – Madison, working either alone or with other researchers at the University (the “Wisconsin Materials” as defined below); and

WHEREAS, Licensee has entered into an Asset Contribution Agreement dated January 4, 2013 with Geron Corporation (“Geron”), pursuant to which certain Wisconsin Materials will be transferred to Licensee (the “ACA”); and

 

WHEREAS, Licensee desires to obtain from WARF rights to utilize the Wisconsin Materials in accordance with the License Agreement executed between the parties dated October 1, 2013 and the terms and conditions set forth below.

NOW, THEREFORE, in consideration of the above premises and the mutual covenants contained herein, the parties further agree as follows:

1.            Except as otherwise provided in this Addendum, all terms and conditions previously set forth in the License Agreement shall remain in effect as set forth therein.  In the event that this Addendum and the License Agreement are inconsistent with respect to any terms and conditions pertaining to the Wisconsin Materials, the terms and provisions of this Addendum shall supersede the terms and provisions of the License Agreement.

2.             “Wisconsin Materials” shall mean the H1, H7, H9, H13 and H14 embryonic stem cell lines provided to Licensee by WARF, Geron or a third party authorized by WARF, including any progeny, unmodified derivatives, genetically modified embryonic stem cells or clones of those cells or cell lines.  Upon request of Licensee, WARF or WiCell shall provide Licensee within thirty (30) days of such request, without additional charge, two aliquots each of the following embryonic stem cell lines:  H1, H9, H7, H13 and H14.

 

3.            As used in the License Agreement, “Licensed Materials” shall further include the Wisconsin Materials; provided, however, that Licensee shall not have the right to:

	(a)	intermix the Wisconsin Materials with an intact embryo, either human or nonhuman;

	(b)	implant the Wisconsin Materials or any products of the Wisconsin Materials in a uterus, including Derivative Materials derived from the Wisconsin Materials;

	(c)	attempting to make whole embryos by any method using the Wisconsin Materials.

	(d)	use the Wisconsin Materials for therapeutic purposes.

Asterias WARF License – 13-00300

Page 23 of 24

 

 

4.            Licensee agrees that on or before June 30th of each year in which this Addendum is in effect, License will submit to WARF a signed Annual Certification Statement as set forth on Exhibit A confirming compliance with the above restrictions.  Licensee agrees that it will comply with all applicable laws, regulations and government orders with respect to any use of the Wisconsin Materials, and shall, as appropriate, seek and comply with the decisions and recommendations of any applicable Institutional Review Board or similar body.

5.            Wisconsin Materials are the property of WARF and are being made available to Licensee as a service by WARF.  Ownership of all Wisconsin Materials, including any progeny or modified versions thereof, shall remain with WARF, regardless of whether such Wisconsin Materials are received from WARF or an authorized third party.  Any Wisconsin Materials provided hereunder will be returned to WARF or destroyed upon a material breach of any terms of this Addendum or the Patent Rights Agreement.

6.            Licensee agrees to communicate to WARF all publications and/or research results made public by Licensee based on research using the Wisconsin Materials.  In addition, any reports, publications, or other disclosure of results obtained with the Wisconsin Materials will acknowledge WARF as the original source of the Wisconsin Materials and, in the event that the Wisconsin Materials were received from an authorized third party, the conditions in which such Wisconsin Materials were maintained prior to their transfer.

7.            Licensee may not assign or transfer this Addendum, nor any of the rights granted herein, without the prior written consent of WARF, such consent not to be unreasonably withheld.  This Addendum shall be governed by and construed in all respects in accordance with the laws of the State of Wisconsin.

The persons signing on behalf of WARF and Licensee hereby warrant and represent that they have authority to execute this Agreement on behalf of the party for whom they have signed.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement on the dates indicated below.

WISCONSIN ALUMNI RESEARCH FOUNDATION

By:     s/Leigh Cagan                                          Date: 10/7, 2013

          Leigh Cagan, Chief Technology Commercialization Officer

ASTERIAS BIOTHERAPEUTICS, INC.

By:       s/Katharine Spink                                 Date:    October 1, 2013

            Katharine Spink Vice President and Chief Operating Officer

WARF Ref.:  Thomson – P96014US

 

 

Asterias WARF License – 13-00300

 

 

Page 24 of 24Exhibit 10.5

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (“Agreement”) is made as of August 15, 2013 by and between BioTime, Inc. (“BioTime”), a California corporation, and Lesley Stolz ("Executive").

 

1.             Engagement; Position and Duties.

 

(a)            BioTime agrees to employ Executive in the position described on Exhibit A (which Exhibit A is a part of this Agreement) effective as of the date of this Agreement. Executive shall perform the duties and functions described on Exhibit A and such other duties as the executive(s) to whom Executive reports or the Board of Directors of BioTime may from time to time determine.  Executive shall devote Executive’s best efforts, skills, and abilities, on a full‐time basis, exclusively to the business of BioTime and its Related Companies pursuant to, and in accordance with, business policies and procedures, as fixed from time to time by the Board of Directors (the “Policies”).  Executive covenants and agrees that Executive will faithfully adhere to and fulfill the Policies, including any changes to the Policies that may be made in the future.  Executive may be provided with a copy of BioTime’s employee manual (the “Manual”) which contains the Policies. BioTime may change its Policies from time to time, in which case Executive will be notified of the changes in writing by a memorandum, a letter, or an update or revision of the Manual.

 

(b)            Performance of Services for Related Companies.  In addition to the performance of services for BioTime, Executive shall, to the extent so required by BioTime, also perform services for one or more members of a consolidated group of which BioTime is a part ("Related Company"), provided that such services are consistent with the kind of services Executive performs or may be required to perform for BioTime under this Agreement.  If Executive performs any services for any Related Company, Executive shall not be entitled to receive any compensation or remuneration in addition to or in lieu of the compensation and remuneration provided under this Agreement on account of such services for the Related Company.  The Policies will govern Executive’s employment by BioTime and any Related Companies for which Executive is asked to provide Services. In addition, Executive covenants and agrees that Executive will faithfully adhere to and fulfill such additional policies as may established from time to time by the board of directors of any Related Company for which Executive performs services, to the extent that such policies and procedures differ from or are in addition to the Policies adopted by BioTime.

 

(c)            No Conflicting Obligations.  Executive represents and warrants to BioTime and each Related Company that Executive is under no obligations or commitments, whether contractual or otherwise, that are inconsistent with Executive’s obligations under this Agreement or that would prohibit Executive, contractually or otherwise, from performing Executive’s duties as under this Agreement and the Policies.

 

(d)            No Unauthorized Use of Third Party Intellectual Property.  Executive represents and warrants to BioTime and each Related Company that Executive will not use or disclose, in connection with Executive’s employment by BioTime or any Related Company, any patents, trade secrets, confidential information, or other proprietary information or intellectual property as to which any other person has any right, title or interest, except to the extent that BioTime or a Related Company holds a valid license or other written permission for such use from the owner(s) thereof.  Executive represents and warrants to BioTime and each Related Company that Executive has returned all property and confidential information belonging to any prior employer.

2.             Compensation

 

(a)            Salary.  During the term of this Agreement, BioTime shall pay to the Executive the salary shown on Exhibit A.  Executive's salary shall be paid in equal semi-monthly installments, consistent with BioTime's regular salary payment practices.  Executive's salary may be increased from time-to-time by BioTime, in BioTime’s sole and absolute discretion, without affecting this Agreement.

 

(b)            Bonus.  Executive may be eligible for an annual bonus, as may be approved by the Board of Directors in its discretion, based on Executive's performance and achievement of goals or milestones set by the Board of Directors from time to time.  Executive agrees that the Board of Directors of BioTime may follow the recommendations of the Compensation Committee of the board of directors of BioTime’s parent company in determining whether to a award bonus or to establish performance goals or milestones.  Executive also agrees that the Board of Directors and BioTime are not obligated to adopt any bonus plan, to maintain in effect any bonus plan that may now be in effect or that may be adopted during the term of Executive’s employment, or to pay Executive a bonus unless a bonus is earned under the terms and conditions of any bonus plan adopted by BioTime.

 

(c)            Expense Reimbursements. BioTime or a Related Company shall reimburse Executive for reasonable travel and other business expenses (but not expenses of commuting to work) incurred by Executive in the performance of Executive’s duties under this Agreement, subject to the Policies and procedures in effect from time to time, and provided that Executive submits supporting vouchers.

 

(d)            Benefit Plans.  Executive may be eligible (to the extent Executive qualifies) to participate in certain retirement, pension, life, health, accident and disability insurance, stock option plan or other similar employee benefit plans which may be adopted by BioTime (or a Related Company) for its employees. BioTime and the Related Companies have the right, at any time and without any amendment of this Agreement, and without prior notice to or consent from Executive, to adopt, amend, change, or terminate any such benefit plans that may now be in effect or that may be adopted in the future, in each case without any further financial obligation to Executive.  Any benefits to which Executive may be entitled under any benefit plan shall be governed by the terms and conditions of the applicable benefit plan, and any related plan documents, as in effect from time to time.  If Executive receives any grant of stock options or restricted stock under any stock option plan or stock purchase plan of BioTime or any Related Company, the terms and conditions of the stock options or restricted stock, and Executive’s rights with respect to the stock options or restricted stock, shall be governed by (i) the terms of the applicable stock option or stock purchase plan, as the same may be amended from time to time, and (ii) the terms and conditions of any stock option agreement or stock purchase agreement and related agreements that Executive may sign or be required to sign with respect to the stock options or restricted stock.

 

(e)            Vacation; Sick Leave.  Executive shall be entitled to the number of days of vacation and sick leave (without reduction in compensation) during each calendar year shown on Exhibit A or as may be provided by the Policies.  Executive’s vacation shall be taken at such time as is consistent with the needs and Policies of BioTime and its Related Companies.  All vacation days and sick leave days shall accrue annually based upon days of service.  Executive’s right to leave from work due to illness is subject to the Policies and the provisions of this Agreement governing termination due to disability, sickness or illness.  The Policies governing the disposition of unused vacation days and sick leave days remaining at the end of BioTime's fiscal year shall govern whether unused vacation days or sick leave days will be paid, lost, or carried over into subsequent fiscal years.

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3.            Competitive Activities. During the term of Executive's employment, and for one year thereafter, Executive shall not, for Executive or any third party, directly or indirectly employ, solicit for employment or recommend for employment any person employed by BioTime or any Related Company.  During the term of Executive's employment, Executive shall not, directly or indirectly as an employee, contractor, officer, director, member, partner, agent, or equity owner, engage in any activity or business that competes or could reasonably be expected to compete with the business of BioTime or any Related Company.  Executive acknowledges that there is a substantial likelihood that the activities described in this Section would (a) involve the unauthorized use or disclosure of BioTime's or a Related Company's Confidential Information and that use or disclosure would be extremely difficult to detect, and (b) result in substantial competitive harm to the business of BioTime or a Related Company.  Executive has accepted the limitations of this Section as a reasonably practicable and unrestrictive means of preventing such use or disclosure of Confidential Information and preventing such competitive harm.

 

4.            Inventions/Intellectual Property/Confidential Information

 

(a)            As used in this Agreement, “Intellectual Property” means any and all inventions, discoveries, formulas, improvements, writings, designs, or other intellectual property.  Any and all Intellectual Property relating to or in any way pertaining to or connected with the systems, products, apparatus, or methods employed, manufactured, constructed, or researched by BioTime, or any Related Company, which Executive may conceive or make while performing services for BioTime or a Related Company shall be the sole and exclusive property of BioTime or the applicable Related Company.  Executive hereby irrevocably assigns and transfers to BioTime, or a Related Company, all rights, title and interest in and to all Intellectual Property that Executive may now or in the future have under patent, copyright, trade secret, trademark or other law, in perpetuity or for the longest period otherwise permitted by law, without the necessity of further consideration.  BioTime and the Related Companies will be entitled to obtain and hold in their own name all copyrights, patents, trade secrets, trademarks and other similar registrations with respect to such Intellectual Property.

 

(b)            Moral Rights.  To the extent allowed by law, the rights to Intellectual Property assigned by Executive to BioTime or any Related Company includes all rights of paternity, integrity, disclosure and withdrawal, and any other rights that may be known as or referred to as “moral rights,” “artist’s rights,” “droit moral,” or the like (collectively “Moral Rights”).  To the extent Executive retains any such Moral Rights under applicable law, Executive hereby ratifies and consents to any action that may be taken with respect to such Moral Rights by or authorized by BioTime or a Related Company and agrees not to assert any Moral Rights with respect thereto.  Executive shall confirm in writing any such ratifications, consents, and agreements from time to time as requested by BioTime or Related Company.

 

(c)            Execution of Documents; Power of Attorney.  Executive agrees to execute and sign any and all applications, assignments, or other instruments which BioTime or a Related Company may deem necessary in order to enable BioTime or a Related Company, at its expense, to apply for, prosecute, and obtain patents of the United States or foreign countries for the Intellectual Property, or in order to assign or convey to, perfect, maintain or vest in BioTime or a Related Company the sole and exclusive right, title, and interest in and to the Intellectual Property.  If BioTime or a Related Company is unable after reasonable efforts to secure Executive’s signature, cooperation or assistance in accordance with the preceding sentence, whether because of Executive’s incapacity or any other reason whatsoever, Executive hereby designates and appoints BioTime or any Related Company or its designee as Executive’s agent and attorney-in-fact, to act on Executive’s behalf, to execute and file documents and to do all other lawfully permitted acts necessary or desirable to perfect, maintain or otherwise protect BioTime’s or a Related Company’s rights in the Intellectual Property.  Executive acknowledges and agrees that such appointment is coupled with an interest and is irrevocable.

3

(d)            Disclosure of Intellectual Property.  Executive agrees to disclose promptly to BioTime or a Related Company all Intellectual Property which Executive may create or conceive solely, jointly, or commonly with others.  This paragraph is applicable whether or not the Intellectual Property was made under the circumstances described in paragraph (a) of this Section.  Executive agrees to make such disclosures understanding that they will be received in confidence and that, among other things, they are for the purpose of determining whether or not rights to the related Intellectual Property is the property of BioTime or a Related Company.

 

(e)            Limitations.  The obligations provided for by this Section 4, except for the requirements as to disclosure in paragraph 4(d), do not apply to any rights Executive may have acquired in connection with Intellectual Property for which no equipment, supplies, facility, or trade secret information of BioTime or a Related Company was used and which was developed entirely on the Executive’s own time and (i) which at the time of conception or reduction to practice does not relate directly or indirectly to the business of BioTime or a Related Company, or to the actual or demonstrable anticipated research or development activities or plans of BioTime or a Related Company, or (ii) which does not result from any work performed by Executive for BioTime or a Related Company.  All Intellectual Property that (1) results from the use of equipment, supplies, facilities, or trade secret information of BioTime or a Related Company; (2) relates, at the time of conception or reduction to practice of the invention, to the business of BioTime or a Related Company, or actual or demonstrably anticipated research or development of BioTime or a Related Company; or (3) results from any work performed by Executive for BioTime or a Related Company shall be assigned and is hereby assigned to BioTime or the applicable Related Company.  The parties understand and agree that this limitation is intended to be consistent with California Labor Code, Section 2870, a copy of which is attached as Exhibit A.  If Executive wishes to clarify that something created by Executive prior to Executive’s employment by BioTime or a Related Company that relates to the actual or proposed business of BioTime or a Related Company is not within the scope of this Agreement, Executive has listed it on Exhibit B in a manner that does not violate any third party rights.

 

(f)            Confidential and Proprietary Information.  During Executive’s employment, Executive will have access to trade secrets and confidential information of BioTime and one or more Related Companies.  Confidential Information means all information and ideas, in any form, relating in any manner to matters such as: products; formulas; technology and know-how; inventions; clinical trial plans and data; business plans; marketing plans; the identity, expertise, and compensation of employees and contractors; systems, procedures, and manuals; customers; suppliers; joint venture partners; research collaborators; licensees; and financial information.  Confidential Information also shall include any information of any kind, whether belonging to BioTime, a Related Company, or any third party, that BioTime or a Related Company has agreed to keep secret or confidential under the terms of any agreement with any third party.  Confidential Information does not include:  (i) information that is or becomes publicly known through lawful means other than unauthorized disclosure by Executive; (ii) information that was rightfully in Executive's possession prior to Executive’s employment with BioTime and was not assigned to BioTime or a Related Company or was not disclosed to Executive in Executive’s capacity as a director or other fiduciary of BioTime or a Related Company; or (iii) information disclosed to Executive, after the termination of Executive’s employment by BioTime, without a confidential restriction by a third party who rightfully possesses the information and did not obtain it, either directly or indirectly, from BioTime or a Related Company, and who is not subject to an obligation to keep such information confidential for the benefit of BioTime, a Related Company, or any third party with whom BioTime or a Related Company has a contractual relationship.  Executive understands and agrees that all Confidential Information shall be kept confidential by Executive both during and after Executive’s employment by BioTime or any Related Company.  Executive further agrees that Executive will not, without the prior written approval by BioTime or a Related Company, disclose any Confidential Information, or use any Confidential Information in any way, either during the term of Executive’s employment or at any time thereafter, except as required by BioTime or a Related Company in the course of Executive’s employment.

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5.            Termination of Employment.  Executive understands and agrees that Executive’s employment has no specific term.  This Agreement, and the employment relationship, are "at will" and may be terminated by Executive or by BioTime (and the employment of Executive by any Related Company may be terminated by the Related Company) with or without cause at any time by notice given orally or in writing.  Except as otherwise agreed in writing or as otherwise provided in this Agreement, upon termination of Executive's employment, BioTime and the Related Companies shall have no further obligation to Executive by way of compensation or otherwise as expressly provided in this Agreement or in any separate employment agreement that might then exist between Executive and a Related Company.

 

(a)            Payments Due Upon Termination of Employment.  Upon termination of Executive's employment with BioTime and all Related Companies at any time and for any reason, Executive will be entitled to receive only the severance benefits set forth below, but Executive will not be entitled to any other compensation, award, or damages with respect to Executive’s employment or termination of employment.

 

(i)            Termination for Cause, Death, Disability, or Resignation.  In the event of Executive's termination for Cause, or termination as a result of death, Disability, or resignation, Executive will be entitled to receive payment for all accrued but unpaid salary, accrued but unpaid bonus, if any, and vacation accrued as of the date of termination of Executive’s employment.  Executive will not be entitled to any cash severance benefits or additional vesting of any stock options or other equity or cash awards.

 

(ii)            Termination Without Cause.  In the event of Executive's termination by BioTime without Cause, Executive will be entitled to (A) the benefits set forth in paragraph (a)(i) of this Section, and (B) payment in an amount equal to: (1) three months' base salary if terminated within the first 12 months of employment, or (2) six months’ base salary if terminated after 12 months of employment, either of which may be paid in a lump sum or, at the election of BioTime, in installments consistent with the payment of Executive's salary while employed by BioTime, subject to such payroll deductions and withholdings as are required by law, and (C) payment, for a period of three months, of any health insurance benefits that Executive was receiving at the time of termination of Executive’s employment, under a BioTime employee health insurance plan subject to the Consolidated Omnibus Budget Reconciliation Act (“COBRA”).  This paragraph shall not apply to (x) termination of Executive’s employment by a Related Company if Executive remains employed by BioTime, or (y) termination of Executive’s employment by BioTime if Executive remains employed by a Related Company.

5

(iii)            Change of Control.  In the event BioTime (or any successor in interest to BioTime that has assumed BioTime's obligation under this Agreement) terminates Executive's employment without Cause within twelve (12) months following a Change in Control, Executive will be entitled to (A) the benefits set forth in paragraph (a)(i) of this Section, and (B) payment of an amount equal to six months' base salary, which shall be paid in a lump sum, subject to such payroll deductions and withholdings as are required by law, and (C) payment, for a period of six months, of any health insurance benefits that Executive was receiving at the time of termination of Executive’s employment under a BioTime employee health insurance plan subject to COBRA.  This paragraph shall not apply to (x) termination of Executive’s employment by a Related Company if Executive remains employed by BioTime or a successor in interest, or (y) termination of Executive’s employment by BioTime or a successor in interest if Executive remains employed by a Related Company.

 

(b)            Release.  Any other provision of this Agreement notwithstanding, paragraphs (a)(ii) and (a)(iii) of this Section shall not apply unless the Executive (i) has executed a general release of all claims against BioTime or its successor in interest and the Related Companies (in a form prescribed by BioTime or its successor in interest) and (ii) has returned all property in the Executive's possession belonging BioTime or its successor in interest and any Related Companies.

 

(c)            Definitions.  For purposes of this Section, the following definitions shall apply:

 

(i)            "Affiliated Group" means (A) a Person and one or more other Persons in control of, controlled by, or under common control with such Person; and (B) two or more Persons who, by written agreement among them, act in concert to acquire Voting Securities entitling them to elect a majority of the directors of BioTime.

 

(ii)            "Cause" means: (A) the failure to properly perform Executive's job responsibilities, as determined reasonably and in good faith by the Board of Directors; (B) commission of any act of fraud, gross misconduct or dishonesty with respect to BioTime or any Related Company; (C) conviction of, or plea of guilty or "no contest" to, any felony, or a crime involving moral turpitude; (D) breach of any provision of this Agreement or any provision of any proprietary information and inventions agreement with BioTime or any Related Company; (E) failure to follow the lawful directions of the Board of Directors of BioTime or any Related Company; (F) chronic alcohol or drug abuse; (G) obtaining, in connection with any transaction in which BioTime, any Related Company, or any of BioTime’s affiliates is a party, a material undisclosed financial benefit for Executive or for any member of Executive’s immediate family or for any corporation, partnership, limited liability company, or trust in which Executive or any member of Executive’s immediate family owns a material financial interest; or (H) harassing or discriminating against, or participating or assisting in the harassment of or discrimination against, any employee of BioTime (or a Related Company or an affiliate of BioTime) based upon gender, race, religion, ethnicity, or nationality.

 

(iii)            "Change of Control" means (A) the acquisition of Voting Securities of BioTime by a Person or an Affiliated Group entitling the holder thereof to elect a majority of the directors of BioTime; provided, that an increase in the amount of Voting Securities held by a Person or Affiliated Group who on the date of this Agreement owned beneficially owned (as defined in Section 13(d) of the Securities Exchange Act of 1934, as amended, and the regulations thereunder) more than 10% of the Voting Securities shall not constitute a Change of Control; and provided, further, that an acquisition of Voting Securities by one or more Persons acting as an underwriter in connection with a sale or distribution of such Voting Securities shall not constitute a Change of Control under this clause (A); (B) the sale of all or substantially all of the assets of BioTime; or (C) a merger or consolidation of BioTime with or into another corporation or entity in which the stockholders of BioTime immediately before such merger or consolidation do not own, in the aggregate, Voting Securities of the surviving corporation or entity (or the ultimate parent of the surviving corporation or entity) entitling them, in the aggregate (and without regard to whether they constitute an Affiliated Group) to elect a majority of the directors or persons holding similar powers of the surviving corporation or entity (or the ultimate parent of the surviving corporation or entity); provided, however, that in no event shall any transaction described in clauses (A), (B) or (C) be a Change of Control if all of the Persons acquiring Voting Securities or assets of BioTime or merging or consolidating with BioTime are one or more Related Companies.

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(iv)            "Disability" shall mean Executive's inability to perform the essential functions of Executive’s job responsibilities for a period of one hundred eighty (180) days in the aggregate in any twelve (12) month period.

 

(v)            "Person" means any natural person or any corporation, partnership, limited liability company, trust, unincorporated business association, or other entity.

 

(vi)            "Voting Securities" means shares of capital stock or other equity securities entitling the holder thereof to regularly vote for the election of directors (or for person performing a similar function if the issuer is not a corporation), but does not include the power to vote upon the happening of some condition or event which has not yet occurred.

 

6.            Turnover of Property and Documents on Termination.  Executive agrees that on or before termination of Executive’s employment, Executive will return to BioTime and all Related Companies all equipment and other property belonging to BioTime and the Related Companies, and all originals and copies of Confidential Information (in any and all media and formats, and including any document or other item containing Confidential Information) in Executive's possession or control, and all of the following (in any and all media and formats, and whether or not constituting or containing Confidential Information) in Executive's possession or control:  (a) lists and sources of customers; (b) proposals or drafts of proposals for any research grant, research or development project or program, marketing plan, licensing arrangement, or other arrangement with any third party; (c) reports, job or laboratory notes, specifications, and drawings pertaining to the research, development, products, patents, and technology of BioTime and any Related Companies; (d) any and all Intellectual Property developed by Executive during the course of employment; and (e) the Manual and memoranda related to the Policies.

 

7.            Arbitration.  Except for injunctive proceedings against unauthorized disclosure of Confidential Information, any and all claims or controversies between BioTime or any Related Company and Executive, including but not limited to (a) those involving the construction or application of any of the terms, provisions, or conditions of this Agreement or the Policies; (b) all contract or tort claims of any kind; and (c) any claim based on any federal, state, or local law, statute, regulation, or ordinance, including claims for unlawful discrimination or harassment, shall be settled by arbitration in accordance with the then current Employment Dispute Resolution Rules of the American Arbitration Association.  Judgment on the award rendered by the arbitrator(s) may be entered by any court having jurisdiction over the Company and Executive.  The location of the arbitration shall be San Francisco, California.  Unless BioTime or a Related Company and Executive mutually agree otherwise, the arbitrator shall be a retired judge selected from a panel provided by the American Arbitration Association, or the Judicial Arbitration and Mediation Service (JAMS).  BioTime, or a Related Company if the Related Company is a party to the arbitration proceeding, shall pay the arbitrator’s fees and costs.  Executive shall pay for Executive’s own costs and attorneys' fees, if any.  BioTime and any Related Company that is a party to an arbitration proceeding shall pay for its own costs and attorneys' fees, if any.  However, if any party prevails on a statutory claim which affords the prevailing party attorneys' fees, the arbitrator may award reasonable attorneys' fees and costs to the prevailing party.

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EXECUTIVE UNDERSTANDS AND AGREES THAT THIS AGREEMENT TO ARBITRATE CONSTITUTES A WAIVER OF EXECUTIVE’S RIGHT TO A TRIAL BY JURY OF ANY MATTERS COVERED BY THIS AGREEMENT TO ARBITRATE.

 

8.            Severability. In the event that any of the provisions of this Agreement or the Policies shall be held to be invalid or unenforceable in whole or in part, those provisions to the extent enforceable and all other provisions shall nevertheless continue to be valid and enforceable as though the invalid or unenforceable parts had not been included in this Agreement or the Policies.  In the event that any provision relating to a time period of restriction shall be declared by a court of competent jurisdiction to exceed the maximum time period such court deems reasonable and enforceable, then the time period of restriction deemed reasonable and enforceable by the court shall become and shall thereafter be the maximum time period.

 

9.            Agreement Read and Understood. Executive acknowledges that Executive has carefully read the terms of this Agreement, that Executive has had an opportunity to consult with an attorney or other representative of Executive’s own choosing regarding this Agreement, that Executive understands the terms of this Agreement, and that Executive is entering this agreement of Executive’s own free will.

 

10.            Complete Agreement, Modification.  This Agreement is the complete agreement between Executive and BioTime on the subjects contained in this Agreement.  This Agreement supersedes and replaces all previous correspondence, promises, representations, and agreements, if any, either written or oral with respect to Executive’s employment by BioTime or any Related Company and any matter covered by this Agreement.  No provision of this Agreement may be modified, amended, or waived except by a written document signed both by BioTime and Executive.

 

11.            Governing Law.  This Agreement shall be construed and enforced according to the laws of the State of California.

 

12.            Assignability.  This Agreement, and the rights and obligations of Executive and BioTime under this Agreement, may not be assigned by Executive.  BioTime may assign any of its rights and obligations under this Agreement to any successor or surviving corporation, limited liability company, or other entity resulting from a merger, consolidation, sale of assets, sale of stock, sale of membership interests, or other reorganization, upon condition that the assignee shall assume, either expressly or by operation of law, all of BioTime's obligations under this Agreement.

 

13.            Survival.  This Section 13 and the covenants and agreements contained in Sections 4 and 6 of this Agreement shall survive termination of this Agreement and Executive's employment.

 

14.            Notices.  Any notices or other communication required or permitted to be given under this Agreement shall be in writing and shall be mailed by certified mail, return receipt requested, or sent by next business day air courier service, or personally delivered to the party to whom it is to be given at the address of such party set forth on the signature page of this Agreement (or to such other address as the party shall have furnished in writing in accordance with the provisions of this Section 14).

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IN WITNESS WHEREOF, Executive and BioTime have executed this Agreement on the day and year first above written.

EXECUTIVE:

	
s/Lesley Stolz

	
 

(Signature)

	
Address:

	
1369 De Soto Ave

	
 

	
Burlingame, CA 94010

BIOTIME:

BioTime, Inc.

	
 

	
By:

	
s/Robert W. Peabody

	
	
 

	
 

	
 

	
	
 

	
Title:

	
COO and CFO

	
	
 

	
 

	
Address:  1301 Harbor Bay Parkway, Suite100

	
 

	
 

	
Alameda, California 94502

	

9

EXHIBIT A

 

Job Title:  EVP of Corporate Development

Description of Job and Duties:

 

The Executive Vice President of Corporate Development will have primary responsibility for interactions with investors and corporate partners on behalf of BioTime and its subsidiaries.  This interaction will include the establishment, development, and maintenance of new relationships with institutional investors, sell-side analysts, and investment banks, as well as the planning and execution of capital-raising transactions for both BioTime and its subsidiary companies.  The incumbent will champion these activities with BioTime’s Chief Executive Officer and Chief Financial Officer participating, as needed.  She will also initiate, develop, and execute corporate partnering relationships with potential pharmaceutical and biotechnology companies interested in licensing products and/or sponsoring product development from within BioTime’s wide array of technological assets.   It is anticipated that BioTime’s leadership role in regenerative medicine with respect to both technology and patents will allow the Executive Vice President of Corporate Development to build a wide array of corporate partnering relationships over time with companies of various sizes that are eager to participate in this emerging field of biotechnology.

Additional representative responsibilities will include, but not necessarily be limited to, the following:

		·	Define and execute strategic initiatives focused on expanding BioTime’s product portfolio, market scope and reach, accelerating the Company’s entry into new markets, responding to competitive threats and maximizing shareholder value through mergers, acquisitions, joint ventures, and/or corporate partnerships.  Develop a sophisticated and detailed understanding of the Company’s product portfolio, research pipeline, and Sales and Marketing infrastructure as the basis for these activities.

		·	In collaboration with senior leadership and other key stakeholders, identify and coordinate the evaluation of prospective deals with input from Research & Development, manufacturing, commercial, legal, finance, and accounting, and presentation of target opportunities to senior management.

		·	Serve as the primary point of contact and a key member of the negotiating team for all transactions approved by Management and the Board.

		·	Establish strong collaborative relationships with the Company’s operational units; act as an advisor or as a transactional partner when appropriate.

Annual Salary :  $275,000

Initial BTX options:  200,000 options, vesting monthly over 48 months

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EXHIBIT B

 

California Labor Code Section 2870.

 

Application of provision providing that employee shall assign or offer to assign rights in invention to employer.

 

(a)            Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer's equipment, supplies, facilities, or trade secret information except for those inventions that either:

 

(i)            Relate at the time of conception or reduction to practice of the invention to the employer's business, or actual or demonstrably anticipated research or development of the employer; or

(ii)            Result from any work performed by the employee for his employer.

(b)            To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable.

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EXHIBIT C

PRIOR MATTERS

None

 

 

12

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