Document:

JOINT RESEARCH AND DEVELOPMENT AGREEMENT

Between

THE JOHNS HOPKINS UNIVERSITY APPLIED

PHYSICS LABORATORY AND

SECOND SIGHT MEDICAL PRODUCTS, INC.

 

This Joint Research and Development Agreement
(“Agreement”) is made and entered into by and between The Johns Hopkins University Applied Physics Laboratory LLC (“JHU/APL”),
and Second Sight Medical Products, Inc. (“Company”) hereinafter collectively referred to as the Parties.

 

Article 1          STATEMENT
OF WORK

 

1.1           The
Statement of Work (SOW) sets forth the nature and scope of the cooperative work to be performed under this Agreement, including
any tasks, material, equipment or other support and any associated reporting requirements. The Statement of Work is attached as
Appendix A to this Agreement.

 

1.2           The
parties recognize that the Statement of Work describes the collaborative work they will undertake and that its goals are good faith
guidelines. Periodic reviews can be held between the Parties for the purpose of assessing progress. It is understood that the nature
of the collaborative work is such that completion within the period of performance specified cannot be guaranteed.

 

Article 2          DISCLOSURE
AND PUBLICATION

 

2.1           "Proprietary
Information" means information that is privileged or confidential, provided that such information: is not known or available
from other sources without obligations concerning its confidentiality; has not been made available by the owners to others without
obligations concerning its confidentiality; is not already available without obligations concerning its confidentiality; and has
not been developed independently by persons who have had no access to the information.

 

2.2           The
Parties agree to confer and consult with each other prior to publication or other public disclosure of the results of the collaborative
work to ensure that no Proprietary Information, or other confidential information is released. Prior to submitting a manuscript
for publication or before any other public disclosure, each Party will offer the other Party at least thirty (30) days to review
the proposed publication or disclosure, submit objections, and file applications for patents, as applicable, in a timely manner.

 

2.3           If
necessary, the Parties will exchange information which they consider to be Proprietary Information. The recipient of such information
agrees to accept the disclosure of said information which is marked as confidential or proprietary or other similar marking, at
the time it is sent to the recipient, and to employ all reasonable efforts to maintain the information secret and confidential,
such efforts to be no less than the degree of care employed by the recipient to preserve and safeguard its own Proprietary Information.
The information shall not be disclosed or revealed to anyone except employees of the recipient who have a need to know the information
and who are under a secrecy obligation with the recipient under which such employees are required to maintain confidential the
Proprietary Information of the recipient and such employees shall be advised by the recipient of the confidential nature of the
Proprietary Information and that the information shall be treated accordingly.

 

2.4           Exceptions.
The recipient's obligations shall not extend to any part of the information:

 

(a)          that
can be demonstrated to have been in the public domain or publicly known and readily available to the trade or the public prior
to the date of the disclosure;

 

(b)          that
can be demonstrated, from written records to have been in the recipient's possession or readily available to the recipient from
another source not under obligation of secrecy to the disclosing Party prior to the disclosure;

 

(c)          that
becomes part of the public domain or publicly known by publication or otherwise, not due to any unauthorized act by the recipient;

 

(d)          that
is demonstrated from written records to have been developed by or for the recipient without reference to confidential information
disclosed by the disclosing Party; or

 

(e )          that is required to be disclosed by
law, government regulation or court order.

 

    	 

    	 

    

  

Article 3           FUNDING

 

3.1 JHU/APL’s obligations under
this agreement and the SOW (Appendix A) are subject to the availability and disbursement of funds from The Mann Fund. No legal
liability on the part of JHU/APL for any payment may arise until funds are made available to JHU/APL from The Mann Fund.

 

3.2 JHU/APL will provide approximately
four million (i.e., $ 4.075 million) dollars of the Mann Fund to Company, within 30 days of receiving funds from the Mann Fund,
for research and development as stated in the SOW. JHU/APL will use funds from the Mann Fund to conduct research as stated in the
SOW, said research being within JHU/APL’s non-profit research, development and educational purposes. If funding is not received
by JHU/APL within three (3) months of execution of this Agreement, all rights and obligations of both parties will terminate.

 

Article 4          INTELLECTUAL
PROPERTY

 

4.1           Background
Intellectual Property

 

"Background Intellectual Property"
(also referred to as "Background IP") means property and the legal rights therein of either or both Parties developed
before and independent of this Agreement including inventions, patent applications, patents, copyrights, trademarks, mask works,
trade secrets and any information embodying proprietary data such as technical data and computer software, or any other legally
protectable information. This Agreement shall not be construed as implying that either Party hereto shall have the right to use
Background IP of the other in connection with this Agreement except as otherwise provided hereunder. Background IP of either Party
may be used non-exclusively and without compensation by either Party in connection with the performance of work under this Agreement,
and limited to the term of this Agreement.

  

4.2           Subject
Intellectual Property

 

		1.	"Subject Intellectual Property" (also referred
to as "Subject IP") means property and the legal rights therein relating to inventions which may be patentable or otherwise
protectable, test data and reports, patent applications, patents, copyrights, trademarks, mask works, trade secrets and any other
legally protectable information, including technical data and computer software, first made
or generated during the performance of work under this Agreement.

 

		2.	Ownership of Subject IP shall vest in the Party whose employee(s),
consultants, or agents make or generate Subject IP, and such Party may perfect legal protection therein in its own name and at
its own expense. Jointly made or generated Subject IP shall be jointly owned by the Parties.

 

		3.	Each Party agrees to disclose to the other Party in writing
and in reasonable detail any jointly made or generated Subject IP. Such disclosure shall be made promptly and no later than thirty
(30) days before any patent application directed to such invention is filed, or no later than thirty (30) days after receipt of
disclosure by the patent department of the disclosing Party of the Subject IP. Any decision to file a patent application directed
to jointly made or generated Subject IP and associated costs shall be negotiated between the Parties. Procedures for seeking and
maintaining statutory protection such as patent protection, for jointly made or generated Subject IP shall be agreed in good faith
by the Parties, provided that neither Party shall unreasonably withhold its agreement to seeking such statutory protection.

 

		4.	Each Party hereto may use, import, copy, modify, prepare
derivative works, distribute, publicly display and perform jointly made or generated Subject IP of the other nonexclusively and
without compensation solely in connection with the performance of work as directed by the SOW under this Agreement.

 

		5.	The nonexclusive license granted in sub-paragraph 4 above
is non-assignable and cannot be sub-licensed, unless either Party obtains written permission from the other Party.

 

		6.	Upon the execution of this Agreement, Company shall issue
to JHU/APL 1,000 shares of common stock (SHARES). Company shall deliver to JHU/APL a stock certificate, duly signed by appropriate
officers of Company and issued to The Johns Hopkins University, representing all of the SHARES. Issuance of SHARES is subject
to Company’ s Board approval, If Company’s Board does not grant approval, which will not be unreasonably withheld,
an equivalent dollar amount of the shares will be paid to JHU/APL based on the public market price. If there is no public market
within three months of the effective date of this agreement, and the Company has not issued the SHARES to JHU/APL, Company shall
pay JHU/APL $14,000.00.

 

    	 

    	 

    

  

		7.	Company
agrees to execute a license with JHU/APL upon incorporation of documented JHU/APL Subject IP, documented either internally or
consistent with paragraph three above, into Company’s product(s) with
the license terms as follows:

 

		a)	Patent Costs: COMPANY shall be required to reimburse JHU/APL for all patent costs for IP developed during performance
of the DEVELOPMENT AGREEMENT. The parties agree to work together to obtain cost effective representation. COMPANY must approve
prosecuting counsel, which approval will not be unreasonably withheld. To the extent COMPANY is obligated to reimburse prosecuting
counsel COMPANY may direct that effort.

 

		b)	Running Royalty Rate: COMPANY shall pay to JHU/APL a royalty of .25% on Net Sales generated by the individual components
that include JHU/APL Subject IP or jointly made Subject IP. The system is currently divided into three components, the implant,
the video processing unit and the glasses.

 

		c)	The Licensed Field of Use: restricted to neurally integrated visual prosthetics.

 

		d)	Terms for Negotiation: Company shall outline for JHU/APL Company's capability and/or plans to introduce Company’s
products into public use. Once due diligence milestone and capabilities are established in a manner reasonably satisfactory to
both parties, JHU/APL and Company agree to negotiate in good faith to establish additional terms of a license agreement granting
Company rights to make, have made, use, sell, offer to sell and import JHU/APL Subject IP . In addition to the terms outlined in
7a-c, the license agreement shall include at least the following additional provisions: a commitment by Company to exert their
best efforts to introduce products and services incorporating JHU/APL Subject IP into public use as rapidly as practicable, and
the right of JHU/APL to terminate the license should Company not meet specified, and mutually agreed due diligence milestones.
At the sole discretion of JHU/APL, such license agreement may include provisions for an option to additional fields of use.

 

		8.	The Parties make NO EXPRESS OR IMPLIED WARRANTY AS TO ANY
MATTER WHATSOEVER, including the conditions of the research or any invention or other intellectual property, or product, whether
tangible or intangible, provided, made or generated under this Agreement, or the merchantability, or fitness for a particular
purpose of the research or JHU/APL Subject IP. The Parties further make no warranty that the use of any intellectual property
made, or generated under this Agreement will not infringe any other United States or foreign patent or other intellectual property
right.

 

ARTICLE 5          EFFECTIVE
DATE AND DURATION

 

The effective date of this Agreement is the date of last signature
by the Parties. This agreement will terminate thirty-six (36) months from the effective date, unless terminated earlier per Article
6, or due to lack of funding per Article 3.

 

ARTICLE 6          TERMINATION

 

6.1           Termination
By Either Party. This Agreement may be terminated by either Party, in the event that the other Party

 

1.          
Files or has filed against it a petition under the Bankruptcy Act, makes an assignment for the benefit of creditors, has a receiver
appointed for it or a substantial part of its assets, or otherwise takes advantage of any statute or law designed for relief of
debtors, or

 

    	 

    	 

    

  

2.          
Fails to perform or otherwise breaches any of its obligations hereunder, if, following the giving of notice by the terminating
Party of its intent to terminate and stating the grounds therefor, the Party receiving such notice shall not have cured the failure
or breach within thirty (30) days. In no event, however, shall such notice or intention to terminate be deemed to waive any rights
to damages or any other remedy which the Party giving notice of breach may have as a consequence of such failure or breach. Either
Party may terminate this Agreement and the license granted herein, for any reason, upon giving the other Party sixty (60) days
written notice.

 

6.2           Obligations
and Duties upon Termination  If this Agreement is terminated or expires, both Parties shall be released from all obligations
and duties imposed or assumed hereunder to the extent so terminated, except as expressly provided to the contrary in this Agreement.
Upon expiration or termination, both Parties shall cease any further use of the Proprietary Information disclosed to the recipient
by the disclosing Party.

 

ARTICLE
7          GENERAL PROVISIONS

 

7.1           This
Agreement constitutes the entire agreement between the Parties concerning the Collaborative Work and supersedes any prior understanding
either written or oral. Additionally, nothing in this Agreement is intended to prevent either Party from performing similar or
related work under other existing or future agreements and such work shall not be included within the scope of this Agreement.

 

7.2           The
relationship of the Parties is that of independent parties and not as agents of each other, partners, or participants in a joint
venture. Each Party shall maintain sole and exclusive control over its personnel and operations.

 

7.3           Neither
Party shall use the name of the other Party on any product or service that is directly or indirectly related to either this Agreement
or any patent license or assignment associated with this Agreement without the prior approval of the other Party.

 

7.4           IN
NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR PUNITIVE, EXEMPLARY, OR CONSEQUENTIAL DAMAGES.

 

7.5           Neither
Party will be in breach of this Agreement for any failure of performance caused by any event beyond its reasonable control and
not caused by the fault or negligence of that Party. In the event such a force majeure event occurs, the Party unable to perform
must promptly notify the other Party and in good faith maintain such part performance as is reasonably possible and resume full
performance as soon as is reasonably possible

 

7.6           This
Agreement shall not be construed as an agreement between the Parties to have any future business dealings.

 

7.7           This
Agreement shall be governed by the laws of the State of Maryland. No consideration shall be given to Maryland's conflict of laws
rules.

 

7.8           COMPANY
understands and agrees that JHU/APL has a technical direction agent relationship with the United States Government which requires
that JHU/APL avoid any work under any contract or agreement that would jeopardize its or its employees' ability to act for the
United States Government as an impartial or neutral evaluator. Therefore, JHU/APL shall at all times under this Agreement retain
the right to refuse to accept any subcontract or other agreement to perform any work under any such subcontract or other agreement
between JHU/APL and COMPANY which in JHU/APL's sole discretion would create an actual or perceived organizational or individual
conflict of interest.

 

7.9           This
Agreement may be amended and any of its terms or conditions may be waived only by a written instrument executed by the authorized
officials of the parties or, in the case of a waiver, by the party waiving compliance. The failure of either party at any time
or times to require performance of any provision hereof shall in no manner affect its right at a later time to enforce the same.
No waiver by either party of any condition or term in any one or more instances shall be construed as a further or continuing waiver
of such condition or term or of any other condition or term.

 

    	 

    	 

    

  

Article 8          SURVIVING
PROVISIONS

 

8.1.          The
provisions covering Liability, Funding, General Provisions, and Surviving Provisions shall survive the completion, termination,
or expiration of this Agreement.

 

8.2           The
export regulations of the United States Government may prohibit, except under a special validated license, the exportation from
the United States of certain commodities and/or related technical data. In order to facilitate the exchange of technical information
under this Agreement, COMPANY hereby gives its assurance to JHU/APL that COMPANY will not knowingly, unless prior authorization
is obtained from the appropriate United States Government agency or agencies, export any apparatus or technical data received from
JHU/APL under this Agreement or LICENSED PRODUCT(S) to any restricted country specified in such regulations. JHU/APL neither represents
that a license is not required nor that, if required, it will be issued by the United States Government.

 

	Second Sight Medical Products, Inc.	 	The Johns Hopkins University
	 	 	Applied Physics Laboratory
	 	 	 
	 	 	 
	 	 	 
	Date	 	Date

 

    	 

    	 

    

 

Appendix
A

Executive Summary

 

The Johns Hopkins University Applied Physics Laboratory (JHU/APL)
is proposing to conduct a multi-year research and development (R&D) effort with the goal of creating a set of core intellectual
property (IP) with applications in multiple biomedical and consumer device markets (Figure 1) and deploying that IP to a next-generation
retinal prosthesis. This 36 month project is highly innovative and achievable by utilizing the financial resources available in
the Alfred Mann Fund at Johns Hopkins and will focus on development of a retinal prosthesis. This work will be conducted in close
collaboration with Second Sight Medical Products, Inc. (SSMP; see attached “Joint R&D Agreement”). This project
is synergistic with ongoing, independent R&D efforts at the Alfred E. Mann Foundation. IP developed during this effort will
also be applicable for a next-generation retinal prosthesis system and a semi-autonomous controller for assistive robotic manipulators
and remote devices (called “HARMONIE”) currently under development by JHU/APL.

 

 

Figure 1: Areas
of innovation for proposed R&D effort. The HARMONIE system lies at the intersection of all four areas, whereas the retinal
prosthesis system occupies the upper-left quadrant. Other markets are listed at the appropriate intersection of technologies.

 

System Components

 

The retinal prosthesis system will rely on a common set of components
to be developed in this effort including a wearable eye-tracking device, a wearable three-dimensional (3D) image sensor, and a
library of software routines that perform scene segmentation and object recognition on the captured images (Figure 2). The eye
tracker will facilitate identification of regions of interest within the patient’s extended field of view, after which the
computer vision algorithms can parse the scenes captured by the 3D image sensor to detect salient entities including both navigational
cues (doorways, steps, obstacles etc.) and manipulable objects (e.g. coffee cup, pencil, etc.). For the retinal prosthesis system,
this information can then be optimally configured for presentation to the patient through the implant.

 

    	 

    	 

    

 

Work Plan

 

This 36 month effort will be primarily dedicated to designing,
implementing and testing the technologies required by the next-generation retinal prosthesis system, and our work plan is integrated
and coordinated with the ongoing design and development effort at SSMP (Figure 3). This work will span a three-phase development
cycle resulting in a final deliverable suitable for testing with retinal prosthesis users. During each phase, the JHU/APL team
will meet regularly with the SSMP team and conduct regular progress reviews. JHU/APL intends to use an agile development approach,
and will work with SSMP to evaluate emerging technologies as candidates for inclusion in the retinal prosthesis system.

 

 

Figure 2: HARMONIE system components. Items shown in green
are shared with the next-generation retinal prosthesis system

 

Phase I spans months 1 through 18 in which APL’s
role will be to deliver a system that integrates a stereo camera sensor and eye tracking sensor into the latest generation of glasses
provided by SSMP. In addition, this effort will also include algorithms required for interfacing with the eye tracking sensor,
image rectification, stereo correspondence, and preliminary 2D and 3D computer vision algorithms for wall, door and obstacle detection.

 

In parallel to this effort, Second Sight will perform substantial
hardware and software re-design of the existing Argus II Externals System (Glasses, Video Processor, Fitting System & Data
Management) with the goal of improving the ease-of-use, aesthetics, performance and battery life of the existing system.

 

Phase 2 is the subsequent phase spanning months 3 through
27. APL’s objective during this phase is to develop an out-of-form-factor brassboard-based solution that builds on the Phase
1 by adding a time-of-flight (ToF) or structured light 3D sensor as well as modifying the COTS eye tracking sensor if needed to
reduce the footprint. In addition, computer vision algorithms will be developed that utilize the new 3D sensor to perform a preliminary
version of common household object detection. When used in conjunction with the stereo camera, this prototype will contain the
necessary sensors to generate high resolution point clouds that can work for both indoor and outdoor lighting conditions.

 

Second Sight will use this phase to add capabilities related
to improving the patient experience, streamline data management, developing an interface to COTS tablets/ smartphones as well as
integrating remote diagnostics, fitting and troubleshooting capabilities.

 

    	 

    	 

    

 

Phase 3 is the final phase which spans months 14 through
36. APL will incorporate all of the lessons learned from the previous two phases resulting in an integrated advanced prototype
solution that can be used for retinal prosthesis testing at SSMP. APL will develop a smaller form factor version of the eye tracking
and computer vision sensors in Prototype 1 with integrated, onboard power as well as a more robust and complete suite of household
object detection algorithms.

 

Once complete, the final prototype will be able to leverage
the eye-tracking sensor to facilitate identification of the user’s field of view and the 3D sensors with corresponding algorithms
to segment obstacles, walls, doors, and household objects such as a mug, pitcher, silverware, remote control, etc. in real time
to provide visual cues to the retinal prosthesis user.

 

Second Sight will focus the development efforts during this
phase on building a fully integrated, head-mounted, all-in-one video processor / glasses device that integrates the various components
provided by JHU/APL including the wearable 3D image sensor(s), eye tracking device and the 2D/3D vision algorithms.

 

 

Figure 3: JHU/APL and Second Sight development
timeline.

 

Budget

 

The total budget of this proposal is $8.08M of which $4.04M
is allocated to APL’s role in developing components for the next-generation retinal prosthesis system and $4.04M is allocated
to Second Sight. This total includes support for project management, design and development, systems engineering processes, and
quarterly travel to Second Sight (Figure 4).

 

 

Figure 4: Expected costs illustrated
as percentages of the overall Mann Fund value (approximately $8M).

 

    	 

    	 

    

 

Value to JHU/APL

 

Over the past decade, JHU/APL has developed the world’s
most advanced upper limb prosthesis, the Modular Prosthetic Limb (MPL). However, bringing an MPL or similar device to market requires
control paradigms and Human Computer Interfaces (HCI) beyond those available today. The HARMONIE platform would enable a broad
base of users to efficiently and effectively control dexterous manipulators like the MPL, and would also allow JHU/APL to develop
innovative solutions in contemporary general-purpose HCI technologies such as head-mounted displays, augmented reality, eye-tracking,
and brain-computer interfaces. Moreover, the synergies between the HARMONIE system and SSMP’s next-generation retinal prosthesis
provide an opportunity for JHU/APL to expand its footprint in neuroprosthetic R&D and enhance our reputation in this field.

 

    	 

    	 

    

 

JHU/APL Statement of Work

 

JHU/APL tasks:

 

Phase 1:

 

1.           Systems
Engineering

 

1.1.         Establish
design controls in compliance with JHU/APL’s Quality Management System and the FDA’s Quality System regulations

1.2.         Conduct
trade studies to evaluate currently-available commercial devices versus custom solutions for critical system components

1.3.         Establish
requirements database

1.4.         Establish
interface control documentation

1.5.         Establish
risk management plan

1.6.         Establish
test plan

1.7.   
     Conduct periodic design reviews (with Second Sight)

 

2.           Integrate
OEM eye tracking sensor suitable for use with existing retinal prosthesis

2.1.         Hardware
engineering tasks

2.1.1.          Acquire
eye tracking sensor

2.2.         Software
engineering tasks

2.2.1.          Create
firmware to interact with eye tracking sensor

2.2.2.          Develop
software for identifying location of eye gaze and eye gaze trajectory

 

3.    
      Integrate stereo camera based depth map sensor for use with existing retinal
prosthesis

3.1.         Hardware
engineering tasks

3.1.1.          Acquire
depth map sensor

3.2.         Software
engineering tasks

3.2.1.          Create
firmware to interact with depth map sensor

3.2.2.          Develop
software for generating point cloud data

3.2.3.          Develop
software for segmenting visual scene

 

4.      
    Create computer vision algorithms for identifying environmental cues for orientation and
navigation

4.1.         Develop
a framework for evaluating computer vision algorithms

4.2.         Develop
software to co-register information from depth map sensor and eye tracking sensor

4.3.         Develop
algorithms for identifying physical objects and structures within the depth map sensor’s field of view

 

Phase 2:

 

1.           Systems
Engineering

 

1.1.         Update
design controls in compliance with JHU/APL’s Quality Management System and the FDA’s Quality System regulations

1.2.         Conduct
trade studies to evaluate currently-available commercial devices versus custom solutions for critical system components

1.3.         Maintain
requirements database

1.4.         Maintain
interface control documentation

1.5.         Maintain
risk management plan

1.6.         Maintain
test plan

 

    	 

    	 

    

 

1.7.         Conduct
periodic design reviews (with Second Sight)

1.8.         Provide
support to Second Sight for clinical testing preparation

 

2.   
       Integrate OEM eye tracking sensor suitable for use with out-of-form-factor
brassboard-based retinal prosthesis system

 

2.1.         Hardware
engineering tasks

2.1.1.          Modify
existing COTS eye tracking sensor or develop custom eye tracking sensor to reduce footprint

2.1.2.          Integrate
sensor with Second Sight’s development board

2.2.         Software
engineering tasks

2.2.1.          Create
firmware to interact with eye tracking sensor

2.2.2.          Develop
software for identifying location of eye gaze and eye gaze trajectory

 

3.      
    Integrate additional time-of-flight or structured light 3D camera for use with out-of-form-factor
brassboard-based retinal prosthesis system

 

3.1.         Hardware
engineering tasks

3.1.1.          Build
depth map sensor

3.1.2.          Integrate
sensor with Second Sight’s development board

3.2.         Software
engineering tasks

3.2.1.          Create
firmware to interact with depth map sensor

3.2.2.          Develop
software for generating point cloud data

3.2.3.          Develop
software for segmenting visual scene

4.       
   Enhance computer vision algorithms for identifying environmental cues for orientation and navigation

4.1.         Develop
software to co-register information from depth map sensor and eye tracking sensor

4.3.         Enhance
algorithms for identifying physical objects and structures within the depth map sensor’s field of view

4.4.         Integrate
algorithms with development board

 

Phase 3:

 

1.   
       Systems Engineering

 

1.1.         Update
design controls in compliance with JHU/APL’s Quality Management System and the FDA’s Quality System regulations

1.2.         Conduct
trade studies to evaluate currently-available commercial devices versus custom solutions for critical system components

1.3.         Maintain
requirements database

1.4.         Maintain
interface control documentation

1.5.         Maintain
risk management plan

1.6.         Maintain
test plan

1.7.         Conduct
periodic design reviews (with Second Sight)

1.8          Provide
support to Second Sight for clinical testing

 

2.        
  Integrate eye tracking sensor for use with final form factor retinal prosthesis system

 

2.1.         Hardware
engineering tasks

2.1.1.          Integrate
sensor with Second Sight’s final form factor retinal prosthesis system

2.2.         Software
engineering tasks

2.2.1.          Enhance
firmware to interact with eye tracking sensor

 

    	 

    	 

    

 

2.2.2.          Enhance
software for identifying location of eye gaze and eye gaze trajectory

 

3.   
       Integrate additional time-of-flight or structured light 3D camera for use with
final form factor retinal prosthesis system

 

3.1.         Hardware
engineering tasks

3.1.2.          Integrate
sensor with Second Sight’s final form factor retinal prosthesis system

3.2.         Software
engineering tasks

3.2.1.          Enhance
firmware to interact with depth map sensor

3.2.2.          Enhance
software for generating point cloud data

3.2.3.          Enhance
software for segmenting visual scene

4.     
     Enhance computer vision algorithms for identifying environmental cues for orientation and
navigation

4.1.         Develop
software to co-register information from depth map sensor and eye tracking sensor

4.3.         Enhance
algorithms for identifying physical objects and structures within the depth map sensor’s field of view

4.4.         Integrate
algorithms with final form factor retinal prosthesis system

 

JHU/APL deliverables:

 

Phase 1:

 

1.    
      Design documents – Month 2

1.1.         Eye
tracking sensor

1.2.         Depth
map sensor

1.3.         Computer
vision algorithms

2.   
       Interface control documents – Month 4

2.1.         Eye
tracking sensor

2.2.         Depth
map sensor

2.3.         Computer
vision algorithms

 

3.    
      Test description documents – Month 6

3.1.         Eye
tracking sensor

3.2.         Depth
map sensor

3.3.         Computer
vision algorithms

4.   
       Component prototypes

4.1.         OEM
eye tracking sensor – Month 10

4.2.         Stereo
vision based depth sensor – Month 11

4.3.         Computer
vision algorithms – Month 13

 

Phase 2:

 

1.    
      Component prototypes integrated in out-of-form-factor brassboard-based retinal prosthesis
system

1.1.         Custom
eye tracking sensor – Month 18

1.2.         Time-of-flight
based depth sensor – Month 20

1.3.         Computer
vision algorithms – Month 20

 

    	 

    	 

    

 

Phase 3:

 

1.       
   Component prototypes integrated in final form factor retinal prosthesis system

1.1.         Custom
eye tracking sensor – Month 25

1.2.         Time-of-flight
+ stereo camera based depth sensor – Month 27

1.3.         Computer
vision algorithms – Month 27

 

Second Sight Statement of Work

 

Phase 1:

 

		1.	Improved industrial design (Glasses & Video processor) for better aesthetics and greater patient satisfaction

		2.	Increased processing power of the Externals System (dual-core OMAP processor + FPGA devices)

		3.	Improved industrial design (User Interface of Fitting System) and fitting algorithms to shorten patient fitting / performance
evaluation time, reduce training and support burden on clinical staff and improve usability/user experience

		4.	Untethered (wireless) and browser-based Fitting System for ease of rehabilitation

		5.	Simplified and integrated data reporting and analysis features (e.g. threshold history, patient performance charts) for more
efficient patient performance monitoring

		6.	Chromatic based image processing algorithms and custom digital camera design for better performance by patients in orientation
and mobility tasks in inclement lighting conditions (low-light, glare situations etc.)

		7.	Patient adjustable controls (brightness/sensitivity and zoom) on the Video processor

		8.	Improved Glasses electronics/coil design to increase system battery life, increase telemetry range, reduce temperature of patient-touching
surfaces and support better ergonomics all for greater patient satisfaction

		9.	Custom battery design for improved ergonomics and better charge capacity

		10.	Framework for downloadable image processing filters

		11.	Support for Next Generation Implant/ASIC advanced features (e.g. current steering)

		12.	Streamlined data management (“Cloud” connectivity) for more efficient access control management, Implant matching,
Cloning and data transfer

		13.	Perform patient testing in conjunction with JHU (IRB approvals, patient enrollment, generation and execution of clinical validation
protocol)

 

Phase 2:

 

		1.	Internationalization of the Fitting System User Interface

		2.	Support for assistive technologies (e.g. voice feedback, vibratory) for better patient experience

		3.	Visual Psychophysics Research Platform (Experiment Builder)

		4.	Fitting System support for tablets and smartphones (‘Bring Your Own Device’)

		5.	Support for Remote Fitting and Troubleshooting to reduce cost and support burden on clinical staff

		6.	Customizable Glasses frames

 

Phase 3:

 

		1.	Wearable 3D image sensor (developed as part of the APL R&D effort)

		2.	Wearable eye tracking device (developed as part of the APL R&D effort)

 

    	 

    	 

    

 

		3.	Complete suite of 3D scene segmentation and household object detection image processing algorithms (developed as part of the
APL R&D effort)

		4.	Support for Next Generation Implant/ASIC advanced features (e.g. neural response imaging etc.)

		5.	Inertial sensors (accelerometers/gyroscopes) for tracking patient head coordinates

		6.	Perform patient testing in conjunction with JHU (IRB approvals, patient enrollment, generation and execution of clinical validation
protocol)

 

Second Sight Deliverables

 

Phase 1:

 

		1.	Re-designed version of the Argus II Externals System (Glasses, Video Processor, Fitting System & Data Management) with
improved ease-of-use, aesthetics, performance and battery life – Month 14

		2.	Clinical Validation report detailing clinical efficacy of the device – Month 18

		3.	Documentation needed by APL for integration – Month 18

 

Phase 2:

 

		1.	Additional capabilities to the retinal prosthesis system including internationalization of Fitting System UI, voice and vibratory
feedback, Visual Psychophysics Research Platform and remote fitting and troubleshooting – Month 27

		2.	Documentation needed by APL for integration – Month 27

 

Phase 3:

 

		1.	A final form factor retinal prosthesis device that consists of a wearable 3D sensor, eye tracking sensor and3D vision algorithms
– Month 32

		2.	Clinical Validation report detailing clinical efficacy of the device – Month 36Exhibit 10.8

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (the “Agreement”), is effective as of the 13th day of October, 2014 (the “Effective Date”), by and between Nature’s Sunshine Products, Inc., a Utah corporation, having its principal place of business at 2500 West Executive Parkway, Lehi, Utah 84043 (the “Company” or “NSP”) and Paul Noack, the undersigned individual having a residence at 2816 Sandhurst Avenue, Thousand Oaks, CA 91362 (“Executive”).

 

The Company desires to engage Executive to provide services for NSP and Executive desires to provide such services on the terms and conditions below.

 

1.                                      Employment

 

1.1                               Positions and Duties. Beginning on or before October 13, 2014 (the “Date of Employment”), Executive will serve as President, China and New Markets, reporting directly to the Chairman and CEO of the Company.  In addition, without additional compensation, if requested by the Company, Executive will serve in other officer positions of the Company and its subsidiaries.  Executive shall devote his best efforts and substantially all of his business time and services to the Company to perform such duties as may be customarily incident to such position of an enterprise of the size and nature of the Company and as may reasonably be assigned from time to time by the Chairman and CEO of the Company or the Company, as the case may be.  Executive will render his services hereunder to the Company, shall use his best efforts, judgment and energy in the performance of the duties assigned to him, shall abide by the Company’s Code of Conduct and any other applicable Company policies, and shall comply with any and all applicable laws, including but not limited to insider trading/reporting requirements and the policies and procedures as may be set forth in the employee handbook, manuals and other materials provided by the Company.

 

1.2                               Place of Performance. Executive shall perform his services hereunder at the Company’s offices in Los Angeles, California; provided, however, that Executive will be required to travel from time to time as reasonably required for business purposes.

 

2.                                      Compensation and Benefits

 

2.1                               Base Salary. Executive shall receive an annual salary of $350,000 paid in accordance with the Company’s payroll practices, as in effect from time to time.  Base salary shall be subject to review on at least an annual basis by the Chairman and CEO. Executive understands that no further compensation will be given for his name being used as an officer or shareholder of any corporation, subsidiary or branch.

 

2.2                               Discretionary Bonus.  Executive shall also be eligible to participate in the executive bonus program (as modified from time to time) or any successor program (the “EBP”).  The EBP, as currently constituted, provides for additional compensation commensurate with Executive’s responsibilities based upon company and individual performance measures, with a target of 75% of Executive’s base salary and a maximum bonus potential payout of 175% of target.  Payment of any bonus under the EBP is in NSP’s sole discretion and such payments will be made in accordance with Internal Revenue Code Section 409A and the terms of the EBP.

 

 

2.3                               Employee Benefits.  Executive will be eligible to participate in retirement/savings, health insurance, term life insurance, long term disability insurance and other employee benefit plans, policies or arrangements maintained by the Company for its employees generally and, at the discretion of the Board, in incentive plans, stock option plans and change in control severance plans maintained by the Company for its executives, if any, subject to the terms and conditions of such plans, policies or arrangements.  The benefits in which Executive shall be eligible to participate as of the Effective Date are set forth in Exhibit B hereto.

 

2.4                               Stock Options.  Contingent upon receiving shareholder approval of the Company’s new stock incentive plan (the “New Plan”), the Company will recommend that the Board of Directors grant Executive an option (the “Option”) to purchase 100,000 shares of NSP common stock under the New Plan.  The Option will have an exercise price per share equal to the closing price of NSP common stock on the date the New Plan is approved by the shareholders.  The Option will become exercisable in four (4) equal annual installments upon Executive’s completion of each year of employment over the four (4) year period measured from the Date of Employment.  The remaining terms of the Option shall be as set forth in the New Plan and such stock option agreement.  The Company may from time to time grant to Executive additional options to purchase shares of NSP common stock pursuant to the price, terms and conditions set forth in the then applicable stock incentive plan, as amended from time to time, or as otherwise set forth in a stock option agreement.

 

3.                                      Indemnification; D&O Insurance.  The Company will indemnify, defend and hold Executive harmless from and against any and all claims, liabilities, obligations, losses, costs, damages or expenses (including reasonable attorneys’ fees and costs of defense) arising out of any claim or legal proceeding levied or brought against Executive, relating in any way to services performed by Executive for the Company, or Executive’s status as an officer, employee or representative of the Company.  This indemnification provision is intended to be broadly interpreted and to provide for indemnification to the full extent permitted by law.  The Company will maintain directors’ and officers’ liability insurance in amounts and on terms reasonable and customary for similarly situated companies.

 

4.                                      Expenses

 

4.1                               Reimbursement of Business Expenses.  In accordance with the Company’s normal policies for expense reimbursement, the Company shall reimburse Executive for all reasonable travel, entertainment and other expenses incurred or paid by Executive in connection with, or related to, the performance of Executive’s duties, responsibilities or services under this Agreement, upon presentation of documentation, including expense statements, vouchers and/or such other supporting information as the Company may request.

 

4.2                               Conditions to Reimbursement.  Executive must submit proper documentation for each relocation and reimbursable expense eligible for reimbursement under this Section 4 within sixty (60) days after the later of (i) Executive’s incurrence of such expense or (ii) Executive’s receipt of the invoice for such expense.  If such expense qualifies hereunder for reimbursement, then the Company will reimburse Executive for that expense within ten (10) business days thereafter.  Each reimbursement must be made no later than the end of the calendar year following the calendar year in which the expense was incurred. The amount of

 

2

 

reimbursements in any calendar year shall not affect the expenses eligible for reimbursement in the same or any other calendar year.  Executive’s right to reimbursement may not be liquidated or exchanged for any other benefit.

 

5.                                      Termination.  Upon cessation of his employment with the Company, Executive will be entitled only to such compensation and benefits as described in this Section 5.

 

5.1.                            Termination without Cause.  The Company may terminate Executive’s employment at any time without Cause (as defined below).  If Executive’s employment by the Company is terminated by the Company without Cause, Executive will be entitled to:

 

5.1.1.                  payment of all accrued and unpaid base salary through the date of such termination;

 

5.1.2.                  provided the Release under Section 5.2 has been executed and become effective and enforceable in accordance with its terms following expiration of the applicable revocation period and Executive complies with the Restrictive Covenants (as set forth in Section 6), monthly severance payments equal to one-twelfth of Executive’s base salary as of the date of such termination for a period equal to twelve (12) months (the “Severance Period”).  The first such payment will be made on the sixtieth (60th) day following Executive’s “separation from service” (as such term is defined under Internal Revenue Code Section 409A (“Code Section 409A”) and the Treasury Regulations thereunder and the remaining payments will be made in accordance with the Company’s normal payroll schedule for salaried employees; and

 

5.1.3.                  provided the Release under Section 5.2 has been executed and become effective and enforceable in accordance with its terms following expiration of the applicable revocation period and Executive complies with the Restrictive Covenants (as set forth in Section 6), the Company will reimburse Executive for the cost he incurs for continuation of Executive’s health insurance coverage under COBRA (and for his family members if Executive provided for their coverage during his or her employment) during the Severance Period and in accord with the NSP plan applicable to NSP employees currently in effect.  Executive shall, within thirty (30) days after each monthly COBRA payment during the Severance Period for which he is entitled to reimbursement in accordance with the foregoing, submit appropriate evidence of such payment to the Company, and the Company shall reimburse Executive, within ten business days following receipt of such submission.  During the period such health care coverage remains in effect hereunder, the following provisions shall govern the arrangement:  (i) the amount of the COBRA costs eligible for reimbursement in any one (1) calendar year of coverage will not affect the amount of such costs eligible for reimbursement in any other calendar year for which such reimbursement is to be provided hereunder; (ii) no COBRA costs will be reimbursed after the close of the calendar year following the calendar year in which those costs were incurred; and (iii) Executive’s right to the reimbursement of such costs cannot be liquidated or exchanged for any other benefit.  In the event the Company’s reimbursement of the reimbursable portion of any COBRA payment hereunder results in Executive’s recognition of taxable income (whether for federal, state or local income tax purposes), the Company will report such taxable income as taxable W-2 wages and collect the applicable withholding taxes, and Executive will be responsible for the payment of any additional income tax liability resulting from such coverage.

 

3

 

5.2.                            Release and Restrictive Covenants.  Notwithstanding any provision of this Agreement, the payments and benefits described in this Section 5 are conditioned on Executive’s execution and delivery to the Company of a release substantially identical to that attached hereto as Exhibit A in a manner consistent with the requirements of the Older Workers Benefit Protection Act, if applicable, and any applicable state law (the “Release”).  In addition, the continuation of the payments and benefits described above is conditioned on Executive’s compliance with the Restrictive Covenants set forth in Section 6 of this Agreement.  A breach of these Restrictive Covenants by the Executive shall constitute a breach of this Agreement, which shall relieve the Company of any further obligation under this Agreement.

 

5.3.                            Termination for Cause.  The Company may terminate Executive’s employment immediately for Cause.  If Executive’s employment with the Company is terminated by the Company for Cause then the Company’s obligation to Executive will be limited solely to the payment of accrued and unpaid base salary through the date of such termination.  To terminate Executive’s employment for Cause, the CEO, in consultation with the Board, must determine in good faith that Cause has occurred.

 

“Cause” means:

 

a)                                     conviction of, or the entry of a plea of guilty or no contest to, a felony or any crime that may materially adversely affect the business, standing or reputation of the Company;

 

b)                                     dishonesty, fraud, embezzlement or other misappropriation of funds;

 

c)                                      material breach of this Agreement; or

 

d)                                     willful refusal to perform the lawful and reasonable directives of the CEO or the Board.

 

5.4                               Resignation by Executive.  Executive may resign his employment by giving the Company four weeks’ notice of said resignation; NSP may elect to pay Employee’s base salary in lieu of notice.  If Executive resigns, then the Company’s obligation to Executive will be limited solely to the payment of accrued and unpaid base salary through the date of such termination.

 

5.5                               Termination upon Death or Incapacity of Executive.  Executive’s employment with the Company shall terminate upon the death or incapacity of Executive.  In the event of termination of Executive’s employment by reason of Executive’s death or incapacity, the provisions governing termination without Cause, above, shall apply.  “Incapacity” shall mean that the Executive is unable to perform the functions consistent with the position in the Company to which he was appointed pursuant to this Agreement by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or that the Executive has been determined to be totally disabled by the Social Security Administration.

 

4

 

5.6.                            Foreign Entities.  Without regard to the circumstances of Executive’s termination from employment, Executive hereby also covenants that upon termination, if he is listed as an officer, director, partner, secretary or shareholder on any corporation, subsidiary or branch on behalf of Nature’s Sunshine Products, Inc. or any related entity, he will sign over any and all rights to stock (except Company stock and stock rights that Executive holds personally) and/or resign as an officer or director prior to departure from the Company as required by the law applicable to the entity or by that entity’s procedural requirements.

 

6.                                      Restrictive Covenants.  In recognition of the compensation and other benefits provided to Executive pursuant to this Agreement, Executive agrees to be bound by the provisions of this Section (the “Restrictive Covenants”). These Restrictive Covenants will apply without regard to whether any termination or cessation of Executive’s employment is initiated by the Company or Executive, and without regard to the reason for that termination or cessation.

 

6.1.                            Covenant Not To Compete.  Executive covenants that, during his employment by the Company , Executive will not do any of the following, directly or indirectly:

 

6.1.1.                  engage, be employed by, participate in, plan for or organize any Competing Business of the Company or any subsidiary or joint venture of the Company; “Competing Business” means any business enterprise that distributes through a multilevel marketing program or that engages in any activity that competes anywhere in the world with any activity in which the Company is then engaged, including sales or distribution of herbs, vitamins or nutritional supplements or any product, which the Company sells or distributes at the time of Executive’s termination; however, it is understood Executive would not be excluded from working in non-competing businesses such as those engaged in ingredient, food, beverage or pharmaceutical research, development, or sales.

 

6.1.2.                  become interested in (as owner, stockholder, lender, partner, co-venturer, director, officer, employee, agent or consultant) any person, firm, corporation, association or other entity engaged in a Competing Business. Notwithstanding the foregoing, Executive may hold up to 2% of the outstanding securities of any class of any publicly-traded securities of any company;

 

6.1.3.                  influence or attempt to influence any employee, sales leader, manager, coordinator, consultant, supplier, licensor, licensee, contractor, agent, strategic partner, distributor, customer or other person to terminate his or her employment with the Company or modify any written or oral agreement, relationship, arrangement or course of dealing the Company; or

 

6.1.4.                  solicit for employment (or arrange to have any other person or entity solicit for employment) any person who has been employed or retained by any member of the Company within the preceding twelve (12) months. For this purpose, advertisements for employment placed in newspapers of general circulation will not be considered solicitation.

 

6.2.                            Confidentiality.  Executive recognizes and acknowledges that the Proprietary Information (as defined below) is a valuable, special and unique asset of the business

 

5

 

of the Company.  As a result, both during the Term and thereafter, Executive will not, without the prior written consent of the Company, for any reason divulge to any third-party or use for his/her own benefit, or for any purpose other than the exclusive benefit of the Company, any Proprietary Information.  Notwithstanding the foregoing, if Executive is compelled to disclose Proprietary Information by court order or other legal process, to the extent permitted by applicable law, he shall promptly so notify the Company so that it may seek a protective order or other assurance that confidential treatment of such Proprietary Information shall be afforded, and Executive shall reasonably cooperate with the Company in connection therewith.  If Executive is so obligated by court order or other legal process to disclose Proprietary Information, Executive will disclose only the minimum amount of such Proprietary Information as is necessary for Executive to comply with such court order or other legal process.

 

6.3.                            Property of the Company.

 

6.3.1.                  Proprietary Information.  All right, title and interest in and to Proprietary Information will be and remain the sole and exclusive property of the Company.  Executive will not remove from the Company’s offices or premises any documents, records, notebooks, files, correspondence, reports, memoranda or similar materials of or containing Proprietary Information, or other materials or property of any kind belonging to the Company unless necessary or appropriate in the performance of his duties to the Company.  If Executive removes such materials or property in the performance of his duties, he will return such materials or property promptly after the removal has served its purpose.  Executive will not make, retain, remove and/or distribute any copies of any such materials or property, or divulge to any third person the nature of and/or contents of such materials or property, except to the extent necessary to perform his duties on behalf of the Company.  Upon termination of Executive’s employment with the Company, he will leave with the Company or promptly return to the Company all originals and copies of such materials or property then in his possession.

 

6.3.1.1.  “Proprietary Information” means any and all proprietary information developed or acquired by the Company that has not been specifically authorized to be disclosed.  Such Proprietary Information shall include, but shall not be limited to, the following items and information relating to the following items: (a) all trade secrets (including research and development, know-how, formulas, compositions, manufacturing and production processes and techniques, methodologies, technical data, designs, drawings and specifications) as well as all inventions (whether patentable or unpatentable and whether or not reduced to practice) and all improvements thereto, (b) computer codes and instructions, processing systems and techniques, inputs, and outputs (regardless of the media on which stored or located) and hardware and software configurations, designs, architecture and interfaces, (c) business research, studies, procedures and costs, (d) financial data, (e) distributor network information, the identities of actual and prospective distributors and distribution methods, (f) marketing data, methods, plans and efforts, (g) the identities of actual and prospective suppliers, (h) the terms of contracts and agreements with, the needs and requirements of and the Company’s course of dealing with, actual or prospective suppliers, (i) personnel information, (j) customer and vendor credit information, and (k) information received from third parties subject to obligations of nondisclosure or non-use.  Failure by the Company to mark any of the Proprietary Information as confidential or proprietary shall not affect its status as Proprietary Information.

 

6

 

6.3.2.                  Intellectual Property.  Executive agrees that all the Intellectual Property (as defined below) will be considered “works made for hire” as that term is defined in Section 101 of the Copyright Act (17 U.S.C. § 101) and that all right, title and interest in such Intellectual Property will be the sole and exclusive property of the Company.  To the extent that any of the Intellectual Property may not by law be considered a work made for hire, or to the extent that, notwithstanding the foregoing, Executive retains any interest in the Intellectual Property, Executive hereby irrevocably assigns and transfers to the Company any and all right, title, or interest that Executive may now or in the future have in the Intellectual Property 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.  The Company will be entitled to obtain and hold in its own name all copyrights, patents, trade secrets, trademarks and other similar registrations with respect to such Intellectual Property.  Executive further agrees to execute any and all documents and provide any further cooperation or assistance reasonably required by the Company to perfect, maintain or otherwise protect its rights in the Intellectual Property, at no cost to Executive.  If the 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 the Company or its designee as Executive’s agent and attorney-in-fact to act on his behalf solely for the purpose of executing and filing documents and doing all other lawfully permitted acts necessary or desirable to perfect, maintain or otherwise protect the Company’s rights in the Intellectual Property. Executive acknowledges and agrees that such appointment is coupled with an interest and is therefore irrevocable.

 

6.3.2.1.  “Intellectual Property” means (a) all inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto, and all patents and patent applications claiming such inventions, (b) all trademarks, service marks, trade dress, logos, trade names, fictitious names, brand names, brand marks and corporate names, together with all translations, adaptations, derivations, and combinations thereof and including all goodwill associated therewith, and all applications, registrations, and renewals in connection therewith, (c) all copyrightable works, all copyrights, and all applications, registrations, and renewals in connection therewith, (d) all mask works and all applications, registrations, and renewals in connection therewith, (e) all trade secrets (including research and development, know-how, formulas, compositions, manufacturing and production processes and techniques, methodologies, technical data, designs, drawings and specifications), (I) all computer software (including data, source and object codes and related documentation), (g) all other proprietary rights or (h) all copies and tangible embodiments thereof (in whatever form or medium) which, in the case of any or all of the foregoing, have been or are developed or created in whole or in part by Executive at any time and at any place while Executive is employed by the Company and have been or are created for the purpose of performing Executive’s duties on behalf of the Company.

 

6.4.                            Acknowledgements.  Executive acknowledges that the Restrictive Covenants are reasonable and necessary to protect the legitimate interests of the Company, that the duration and geographic scope of the Restrictive Covenants are reasonable given the nature of this Agreement and the position Executive holds within the Company, and that the Company would not enter into this Agreement or otherwise employ or continue to employ Executive unless Executive agrees to be bound by the Restrictive Covenants set forth in this Section 6.

 

7

 

6.5.                            Remedies and Enforcement upon Breach.

 

6.5.1.                  Intention.  It is the intention of the parties that the foregoing restrictive covenant be enforced as written, and, in any other event, enforced to the greatest extent (but to no greater extent) in time, territory and degree of participation as permitted by applicable law. Accordingly, in the event that any court to which a dispute over these restrictions may be referred shall find any of these restrictions overly broad or unreasonable in any way, that court must enforce the restrictions to the greatest extent deemed reasonable.

 

6.5.2.                  Specific Enforcement.  Executive acknowledges that any breach by him, willfully or otherwise, of the Restrictive Covenants will cause continuing and irreparable injury to the Company for which monetary damages would not be an adequate remedy.  In the event of any such breach or threatened breach by Executive of any of the Restrictive Covenants, the Company shall be entitled to injunctive or other similar equitable relief in any court, without any requirement that a bond or other security be posted, and this Agreement shall not in any way limit remedies of law or in equity otherwise available to the Company.

 

6.5.3.                  Enforceability.  If any court holds the Restrictive Covenants unenforceable by reason of their breadth or scope or otherwise, it is the intention of the parties hereto that such determination not bar or in any way affect the right of the Company to the relief provided above in the courts of any other jurisdiction within the geographic scope of such Restrictive Covenants.

 

6.5.4.                  Disclosure of Restrictive Covenants.  Executive agrees to disclose the existence and terms of the Restrictive Covenants to any employer that Executive may work for during the Restricted Period.

 

6.5.5.                  Extension of Restricted Period.  If the Executive breaches Section 6.1 in any respect, the restrictions contained in that section will be extended for a period equal to the period that the Executive was in breach.

 

7.                                      Miscellaneous.

 

7.1.                            Other Agreements.  Executive represents and warrants to the Company that there are no restrictions, agreements or understandings whatsoever to which Executive is a party that would prevent or make unlawful his execution of this Agreement, that would be inconsistent or in conflict with this Agreement or Executive’s obligations hereunder, or that would otherwise prevent, limit or impair the performance of Executive’s duties under this Agreement.

 

7.2.                            Successors and Assigns.  This Agreement shall be binding upon any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, and the Company shall require any such successor to expressly assume and agree in writing to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place, or, in the event the Company remains in existence, the Company shall continue to employ Executive under the terms hereof.   As used in this Agreement, the

 

8

 

“Company” shall mean the Company and any successor to its business and/or assets, which assumes or is obligated to perform this Agreement by contract, operation of law or otherwise.  This Agreement shall inure to the benefit of and be enforceable by Executive and his personal or legal representatives, executors, estate, trustee, administrators, successors, heirs, distributees, devisees and legatees.  The duties of Executive hereunder are personal to Executive and may not be assigned by him.  If Executive dies and any amounts become payable under this Agreement, the Company will pay those amounts to his estate.

 

7.3.                            Governing Law and Enforcement; Disputes.  This Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to the principles of conflicts of laws.  Any legal proceeding arising out of or relating to this Agreement will be instituted in a state or federal court in the State of Utah, and Executive and the Company hereby consent to the personal and exclusive jurisdiction of such court(s) and hereby waive any objection(s) that they may have to personal jurisdiction, the laying of venue of any such proceeding and any claim or defense of inconvenient forum.

 

7.4.                            Waivers.  The waiver by either party of any right hereunder or of any breach by the other party will not be deemed a waiver of any other right hereunder or of any other breach by the other party.  No waiver will be deemed to have occurred unless set forth in writing. No waiver will constitute a continuing waiver unless specifically stated, and any waiver will operate only as to the specific term or condition waived.

 

7.5.                            Severability.  Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law.  However, if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability will not affect any other provision, and this Agreement will be reformed, construed and enforced as though the invalid, illegal or unenforceable provision had never been herein contained.

 

7.6.                            Survival. Section 6 of this Agreement will survive termination of this Agreement and/or the cessation of Executive’s employment by the Company.

 

7.7.                            Notices.  Any notice or communication required or permitted under this Agreement shall be made in writing and shall be sufficient if personally delivered or sent by registered or certified mail and addressed, if to Employee, to Employee’s address set forth in NSP’s records, or if to NSP, to its principal office, to the attention of the CEO.  Such notice shall be deemed given when delivered if delivered personally, or, if sent by registered or certified mail, at the earlier of actual receipt or three days after mailing in United States mail, addressed as aforesaid with postage prepaid.

 

7.8.                            Entire Agreement; Amendments.  This Agreement, the attached exhibits, the Plan, and the Award Agreement contain the entire agreement and understanding of the parties hereto relating to the subject matter hereof; and merge and supersede all prior and contemporaneous discussions, agreements and understandings of every nature relating to Executive’s employment or engagement with, or compensation by, the Company and any of its affiliates or subsidiaries or any of their predecessors, including, without limitation, the Existing

 

9

 

Agreement.  This Agreement may not be changed or modified, except by an agreement in writing signed by each of the parties hereto.

 

7.9.                            Withholding.  All payments to Executive will be subject to tax withholding in accordance with applicable law.

 

7.10.                     Section Headings.  The headings of sections and paragraphs of this Agreement are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.

 

7.11.                     Counterparts; Facsimile.  This Agreement may be executed in multiple counterparts (including by facsimile signature), each of which will be deemed to be an original, but all of which together will constitute one and the same instrument.

 

7.12.                     Third Party Beneficiaries.  Subject to Section 7.2, this Agreement will be binding on, inure to the benefit of and be enforceable by the parties and their respective heirs, personal representatives, successors and assigns.  This Agreement does not confer any rights, remedies, obligations or liabilities to any entity or person other than Executive and the Company and Executive’s and the Company’s permitted successors and assigns, although this Agreement will inure to the benefit of the Company.

 

8.                                      Section 409A.

 

8.1.                            Section 409A Compliance.  The parties intend that this Agreement comply with the requirements of Code Section 409A.  To the extent there is any ambiguity as to whether any provision of the Agreement would otherwise contravene one or more requirements or limitations of Code Section 409A, such provision shall be interpreted and applied in a manner that does not result in a violation of the applicable requirements or limitations of Code Section 409A and the Treasury Regulations thereunder.  To the extent any continuing compensation, bonus, severance, reimbursements or in-kind benefits due or payable to Executive under this Agreement constitutes “deferred compensation” under Section 409A of the Code, any such compensation, bonus, severance, reimbursements or in-kind benefits shall constitute and be treated as a series of separate payments under Treasury Regulations Section 1.409A-2(b)(2)(iii) with each such payment made under this Agreement being so designated as a “separate payment” within the meaning of Section 409A of the Code.  In no event shall Executive have the right to designate, directly or indirectly, the calendar year of any payment subject to Code Section 409A.

 

8.2.                            Delayed Commencement Date.  Notwithstanding any provision of this Agreement to the contrary, if Executive is a “specified employee” as defined in Section 409A of the Code, Executive shall not be entitled to any payments or benefits the right to which provides for a “deferral of compensation” with the meaning of Section 409A of the Code (taking into account all applicable exemption or exceptions), and whose payment or provision is triggered by Executive’s termination of employment with the Company (whether such payments or benefits are provided to Executive under this Agreement or under any plan or program or arrangement of the Company), including as a result of Executive’s Incapacity (other than Executive being “disabled” within the meaning of Section 409A of the Code), until the earlier of (i) the date which is the first business day following the six month anniversary of Executive’s “separation

 

10

 

from service” as defined in Section 409A of the Code for any reason other than death, or (ii) Executive’s date of death, and such payments or benefits that, if not for the six month delay described herein, would be due and payable prior to such date shall be made or provided to Executive on such date.  The Company shall make the determination as to whether Executive is a “specified employee” in good faith in accordance with its general procedures adopted in accordance with Section 409A of the Code and, at the time of Executive’s “separation from service” will notify Executive of whether or not Executive is a “specified employee.”

 

8.3                               Savings Clause.  Notwithstanding the other provisions of this Agreement, with respect to any right to a payment or benefit hereunder (or any portion thereof) that does not otherwise provided for a “deferral of compensation” as defined in Section 409A of the Code, it is the intent of the parties that such payment or benefit will not so provide.  Furthermore, if either party notifies the other in writing that, based upon the advice of legal counsel, one or more of the provisions of this Agreement contravenes any regulation or Treasury guidance promulgated under Section 409A of the Code or causes any amount to be subject to interest or penalties under Section 409A of the Code, the parties shall promptly and reasonably consult with each other (and their legal counsel (and shall use their reasonable best efforts to reform the provisions hereof to (a) maintain to the maximum extent practicable the original intent of the applicable provisions without violating the provisions of Section 409A of the Code or increasing the costs to the Company of providing the applicable benefit or payment and (b) to the extent practicable, to avoid the imposition of any tax, interest or other penalties under Section 409A of the Code upon Executive or the Company.

 

8.4                               280G.  Anything in this Agreement to the contrary notwithstanding, in the event that it shall be determined that any payment, distribution, or other action by the Company to or for Executive’s benefit (whether paid or payable or distributed or distributable pursuant to the terms of the Agreement or otherwise (“Parachute Payment”), would result in an “excess parachute payment” within the meaning of Section 280G(b)(i) of the Code, and the value determined in accordance with Section 280G(d)(4) of the Code of the Parachute Payments, net of all taxes imposed on Executive (the “Net After-Tax Amount”) that Executive would receive would be increased if the Parachute Payments were reduced, then the Parachute Payments shall be reduced by an amount (the “Reduction Amount”) so that the Net After-Tax Amount after such reduction is greatest.  For purposes of determining the Net After-Tax Amount, Executive shall be deemed to (i) pay federal income taxes at the highest marginal rates of federal income taxation for the calendar year in which the Parachute Payment is to be made, and (ii) pay applicable state and local income taxes at the highest marginal rate of taxation for the calendar year in which the Parachute Payment is to be made, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes.  Subject to the provisions of this Section 9.4, all determinations required to be made under this Section 9.4, including the Net After-Tax Amount, the Reduction Amount and the Parachute Payments that are to be reduced pursuant to this Section 9.4 and the assumptions to be utilized in arriving at such determinations, shall be made by independent public accounting firm selected by Executive (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and Executive within fifteen (15) business days of the receipt of notice from Executive that there has been a Parachute Payment, or such earlier time as is requested by Executive.  The Accounting Firm’s decision as to which Parachute Payments are to be reduced shall be made (a) only from Parachute Payments that the Accounting Firm determines reasonably may be characterized as

 

11

 

“parachute payments” under Section 280G of the Code; (b) only from Parachute Payments that are required to be made in cash; (c) only with respect to any amounts that are not payable pursuant to a “nonqualified deferred compensation plan” subject to Section 409A of the Code, until those payments have been reduced to zero; and (d) in reverse chronological order, to the extent that any Parachute Payments subject to reduction are made over time (e.g., in installments).  In no event, however, shall any Parachute Payments be reduced if and to the extent such reduction would cause a violation of Section 409A of the Code or other applicable law.  All fees and expenses of the Accounting Firm shall be borne solely by the Company.  Any determination by the Accounting Firm shall be binding upon the Company and Executive.

 

[This space left blank intentionally; signature page follows]

 

12

 

	
 
    	
NATURE’S   SUNSHINE PRODUCTS, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Patrick O’Hara
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Title:  Vice President of   Human Resources
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
PAUL NOACK
    
	
 
    	
 
    
	
 
    	
/s/   Paul Noack
    
	
 
    	
Executive

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00237-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00237-of-00352.parquet"}]]