Ernexa Therapeutics Inc 8-K, filed Sep 13, 2021
Ernexa Therapeutics Inc. (ERNA)
8-K
2021-09-13
For: 2021-09-03
View Original
Added on
April 06, 2026
About this 8-K
Ernexa Therapeutics Inc filed this 8-K on September 13, 2021, reporting on events of September 3, 2021.
Items reported
- Item 5.07: Shareholder vote results
- Item 9.01: Financial statements and exhibits
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 3, 2021
(Exact Name of Registrant as Specified in its Charter)
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(State or Other Jurisdiction of Incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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(Address of Principal Executive Offices)
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(Zip Code)
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Registrant’s telephone number, including area code: (212 ) 582-1199
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading symbol
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Name of each exchange on which registered
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Indicate by check mark whether the registrant is an emerging
growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934:
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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Item 5.07
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Submission of Matters to a Vote of Security Holders.
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As described in our current report on Form 8-K filed with
the Securities and Exchange Commission on August 20, 2021, we called to order our 2021 Annual Meeting of Stockholders on August 20, 2021, but adjourned the meeting until September 3, 2021 in order to solicit additional proxies that would constitute a quorum. We refer to the Annual Meeting of
Stockholders on August 20, 2021, as reconvened on September 3, 2021, as the Annual Meeting.
The board of directors solicited proxies pursuant to a proxy statement that we filed with the Securities and Exchange Commission under
Section 14(a) of the Securities Exchange Act of 1934 on July 1, 2021, as supplemented by proxy supplements filed with the Securities and Exchange Commission on July 26, 2021 and August 20, 2021. There was no solicitation in opposition to the
board’s solicitation.
At the Annual Meeting, holders of common stock were asked to consider and vote upon the three proposals set forth below. Each share of
common stock was entitled to one vote with respect to each matter submitted to a vote at the meeting. Shares of common stock representing 37,699,666, or 85.3% of the total votes attributable to all outstanding shares of common stock, were present
in person or by proxy at the Annual Meeting.
The voting results reported below are final.
The matters considered and voted on by the stockholders at the meeting and the votes of the stockholders were as follows:
| Proposal 1. |
Stockholders elected each of the nominees for director identified in the proxy statement as a director to serve until the 2022 Annual Meeting of
Stockholders and until his or her successor is duly elected and qualified, by the following vote:
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Nominee
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For
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Withhold
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Broker Non-Votes
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Charles Cherington
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33,886,117
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375,372
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3,438,177
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Howard J. Federoff
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34,143,243
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118,246
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3,438,177
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Luba Greenwood
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34,120,931
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140,558
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3,438,177
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Dennis H. Langer
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34,112,201
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149,288
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3,438,177
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Erich Mohr
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34,122,631
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138,858
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3,438,177
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| Proposal 2. |
Stockholders approved the ratification of the amendment to our certificate of incorporation to effect an increase in the number of authorized shares of common stock
from 15,000,000 to 100,000,000, by the following vote:
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For
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Against
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Abstain
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Approval of ratification of charter amendment
to increase number of authorized shares of common stock
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37,171,336
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492,250
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36,080
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| Proposal 3. |
Stockholders approved the Restated 2020 Stock Incentive Plan, by the following vote:
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For
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Against
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Abstain
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Broker Non-Votes
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Approval of Restated 2020 Stock Incentive Plan
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33,728,197
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517,626
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15,666
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3,438,177
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| Item 9.01 |
Financial Statements and Exhibits.
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(d)
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Exhibits.
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Exhibit
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Description
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Certificate of Validation of Brooklyn ImmunoTherapeutics, Inc., as filed with the Secretary of State of the State of Delaware on
September 3, 2021
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Brooklyn ImmunoTherapeutics, Inc. Restated 2020 Stock Incentive Plan
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104
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Cover Page Interactive Data File (embedded within the XBRL document)
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+
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Indicates management contract or compensatory plan.
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2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
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BROOKLYN IMMUNOTHERAPEUTICS, INC.
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By:
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/s/ Howard J. Federoff
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Howard J. Federoff
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Chief Executive Officer and President
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Dated: September 10, 2021
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Exhibit 3.1
CERTIFICATE OF VALIDATION
OF
BROOKLYN IMMUNOTHERAPEUTICS, INC.
Pursuant to Section 204 of the
General Corporation Law of the State of Delaware
Brooklyn ImmunoTherapeutics,
Inc., a corporation organized and existing under the laws of the State of Delaware (the “Corporation”), certifies as follows:
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The defective corporate acts that are the subject of this Certificate of Validation are (a) the Corporation’s issuance of shares of its common stock, par value $0.005 per share (“Common
Stock”), from 15,000,000 to 100,000,000
shares on each of the dates and in the amounts set forth in the table below (collectively, the “Putative Stock Issuances”) and
(b) an amendment to the certificate of incorporation of the Corporation (the “Certificate of Amendment”) filed with the Secretary of
State on March 25, 2021 at 4:02 p.m. (Eastern time) that purported to increase the number of authorized shares of Common Stock from
15,000,000 to 100,000,000:
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Number of Shares of Common Stock
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Date of Issuance
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39,991,625
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March 25, 2021
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56,041
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April 26, 2021
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700
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May 7, 2021
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302,358
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May 14, 2021
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330,813
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May 17, 2021
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384,615
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May 18, 2021
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53,909
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May 19, 2021
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50,000
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May 26, 2021
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300
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May 28, 2021
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202
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June 1, 2021
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300
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June 3, 2021
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442,622
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June 7, 2021
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500,000
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June 8, 2021
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563,776
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June 9, 2021
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527,808
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June 29, 2021
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7,022,230
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July 16, 2021
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The Certificate of Amendment and the Putative Stock Issuances constitute defective corporate acts under Section 204 of the Delaware General Corporation Law (the “DGCL”) by reason of a “failure of authorization” as defined in Section 204 of the DGCL because (a) the Certificate of Amendment was adopted
contrary to a disclosure set forth in a proxy statement soliciting the stockholder vote on said amendment and (b) if the Certificate of Amendment was void or voidable by reason of such defect in authorization, the Putative Stock Issuances
exceeded the number of shares of Common Stock the Corporation was authorized to issue.
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The Putative Stock Issuances and the Certificate of Amendment were duly ratified in accordance with Section 204 of the DGCL pursuant to resolutions adopted by the
Corporation’s Board of Directors at meetings held on June 30, 2021 and July 12, 2021. The Putative Stock Issuances and the Certificate of Amendment were duly ratified in accordance with Section 204 of the DGCL pursuant to resolutions
adopted by the Corporation’s stockholders at a meeting of stockholders held on September 3, 2021.
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Pursuant to Section 204(e)(3)a.(x) of the DGCL, the name, title and filing date of the certificate previously filed and any certificate of correction thereto is the
Certificate of Amendment of Certificate of Incorporation of the Corporation as filed with the Secretary of State on March 25, 2021 at 4:02 p.m. (Eastern time).
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Pursuant to Section 204(e)(3)a.(y) of the DGCL, the certificate of amendment of certificate of incorporation as previously filed with the Secretary of State on March
25, 2021 at 4:02 p.m. (Eastern time) is attached hereto as Exhibit A.
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In Witness
Whereof, the Corporation has caused this Certificate of Validation to be executed by its duly authorized officer as of September
3, 2021.
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/s/ Howard J. Federoff
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Howard J. Federoff
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Chief Executive Officer and President
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Exhibit A
OF AMENDMENT OF
RESTATED CERTIFICATE OF INCORPORATION
OF
NTN BUZZTIME, INC.
NTN Buzztime, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify that:
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This Certificate of Amendment (the “Certificate of Amendment”)
hereby amends the Corporation’s Restated Certificate of Incorporation (as amended prior to the date hereof, the “Certificate of lncorporation”)
as set forth herein.
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The first sentence of Article IV of the Certificate of Incorporation is hereby amended and restated in its entirety as follows:
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“The total number of shares of stock which the Corporation shall have authority to issue is 101,000,000 shares, of which 100,000,000
shares shall be Common Stock, par value $.005 per share, and 1,000,000 shall be Preferred Stock, par value $.005 per share.”
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The foregoing amendment was duly adopted in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware.
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All other provisions of the Certificate of Incorporation shall remain in full force and effect.
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IN WITNESS WHEREOF, the Corporation has caused this Certificate of Amendment to be signed by its duly authorized officer this 25 th
day of March 2021.
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NTN Buzztime, Inc.
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/s/ Allen Wolff
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Name: Allen Wolff
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Title: Chief Executive Officer
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Exhibit 99.1
BROOKLYN IMMUNOTHERAPEUTICS, INC.
RESTATED 2020 STOCK INCENTIVE PLAN
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ESTABLISHMENT, EFFECTIVE DATE AND TERM
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Brooklyn ImmunoTherapeutics, Inc. (f/k/a NTN Buzztime, Inc.), a Delaware corporation (the “Company”), hereby establishes the Brooklyn ImmunoTherapeutics, Inc. Restated 2020 Stock Incentive Plan (the “Plan”).
The “Effective Date” of the Plan shall be the later of: (a) the date the Plan was approved by the Board, and (b) the date the Plan was approved by the stockholders of the Company in accordance with the laws of the State of Delaware, or such later
date as provided in the resolutions adopting the Plan; provided, however, that no Award may be granted unless and until the Plan has been
approved by the stockholders of the Company. Unless earlier terminated pursuant to Section 15(k) hereof, the Plan shall terminate on the tenth anniversary of the Effective Date. Capitalized terms used herein are defined in Appendix A attached hereto.
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PURPOSE
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The purpose of the Plan is to enable the Company to attract, retain, reward and motivate Eligible Individuals by providing them
with an opportunity to acquire or increase a proprietary interest in the Company and to incentivize them to expend maximum effort for the growth and success of the Company, so as to strengthen the mutuality of the interests between the Eligible
Individuals and the stockholders of the Company.
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ELIGIBILITY
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Awards may be granted under the Plan to any Eligible Individual, as determined by the Committee from time to time, based on their
importance to the business of the Company, pursuant to the terms of the Plan.
| 4. |
ADMINISTRATION
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| (a) |
Committee. The Plan shall be administered by the Committee, which shall
have the full power and authority to take all actions, and to make all determinations not inconsistent with the specific terms and provisions of the Plan and deemed by the Committee to be necessary or appropriate to the administration of
the Plan, any Award granted or any Award Agreement entered into hereunder. The Committee may correct any defect or supply any omission or reconcile any inconsistency in the Plan or in any Award Agreement in the manner and to the extent it
shall deem expedient to carry the Plan into effect as it may determine in its sole discretion. The decisions by the Committee shall be final, conclusive and binding with respect to the interpretation and administration of the Plan, any
Award or any Award Agreement entered into under the Plan. The Committee may, in its sole discretion, accelerate the vesting, exercisability or lapse of restrictions with respect to any Award, provided that the exercise of such discretion is
not otherwise prohibited by the Plan or violates the requirements of the Code.
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| (b) |
Delegation to Officers or Employees. The Committee may designate officers
or employees of the Company to assist the Committee in the administration of the Plan. The Committee may delegate authority to officers or employees of the Company to grant Awards and execute Award Agreements or other documents on behalf of
the Committee in connection with the administration of the Plan, subject to whatever limitations or restrictions the Committee may impose in accordance with applicable law and to the extent that such delegation will not result in the loss
of an exemption under Rule 16b‑3(d)(1) for Awards granted to Participants subject to Section 16 of the Exchange Act in respect of the Company and will not result in a related-person transaction with an executive officer required to be
disclosed under Item 404(a) of Regulation S-K (in accordance with Instruction 5.a.ii thereunder) under the Exchange Act.
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Designation of Advisors. The Committee may designate professional advisors
to assist the Committee in the administration of the Plan. The Committee may employ such legal counsel, consultants, and agents as it may deem desirable for the administration of the Plan and may rely upon any advice and any computation
received from any such counsel, consultant, or agent. The Company shall pay all expenses and costs incurred by the Committee for the engagement of any such counsel, consultant, or agent.
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Participants Outside the U.S. In order to conform with the provisions of
local laws and regulations of foreign countries which may affect the Awards or the Participants, the Committee shall have the sole discretion to (i) modify the terms and conditions of the Awards granted under the Plan to Eligible
Individuals located outside the United States; (ii) establish subplans with such modifications as may be necessary or advisable under the circumstances present by local laws and regulations; and (iii) take any action which it deems
advisable to comply with or otherwise reflect any necessary governmental regulatory procedures, or to obtain any exemptions or approvals necessary with respect to the Plan or any subplan established hereunder.
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| (e) |
Liability and Indemnification. No Covered Individual shall be liable for
any action or determination made in good faith with respect to the Plan, any Award granted hereunder or any Award Agreement entered into hereunder. The Company shall, to the maximum extent permitted by applicable law and its Certificate of
Incorporation and Bylaws, indemnify and hold harmless each Covered Individual against any cost or expense (including reasonable attorney fees reasonably acceptable to the Company) or liability (including any amount paid in settlement of a
claim with the approval of the Company), and amounts advanced to such Covered Individual necessary to pay the foregoing at the earliest time and to the fullest extent permitted, arising out of any act or omission to act in connection with
the Plan, any Award granted hereunder or any Award Agreement entered into hereunder. Such indemnification shall be in addition to any rights of indemnification such individuals may have under other agreements, applicable law or under the
Certificate of Incorporation or Bylaws of the Company. Notwithstanding anything else herein, this indemnification will not apply to the actions or determinations made by a Covered Individual with regard to Awards granted to such Covered
Individual under the Plan or arising out of such Covered Individual’s own fraud or bad faith.
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| 5. |
SHARES OF COMMON STOCK SUBJECT TO THE PLAN
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| (a) |
Shares Available for Awards. The Common Stock that may be issued pursuant
to Awards granted under the Plan shall be treasury shares or authorized but unissued shares of the Common Stock. The total number of shares of Common Stock that may be initially issued pursuant to Awards granted under the Plan shall be
equal to the sum of (i) 8,484,936 shares and (ii) an annual increase on January 1 of each year beginning in 2022 and ending in (and including) 2031 equal to the lesser of (A) 5% of the number of shares of Common Stock outstanding on
December 31 of the immediately preceding year and (B) such smaller number of shares of Common Stock as may be determined by the Board.
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| (b) |
Certain Limitations on Specific Types of Awards. The granting of Awards
under this Plan shall be subject to the following limitations:
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| (i) |
With respect to the shares of Common Stock reserved pursuant to this Section, a maximum of 8,484,936 shares may be subject to grants of Incentive Stock Options,
provided that notwithstanding the foregoing, shares of Common Stock added to the Plan pursuant to Section 5(a)(ii) shall be available for issuance as Incentive Stock Options only to the extent that making such shares available for issuance
as Incentive Stock Options would not cause any Incentive Stock Option to cease to qualify as such.
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| (ii) |
With respect to the shares of Common Stock reserved pursuant to this Section, a maximum of 8,484,936 of such shares may be issued in connection with Awards, other
than Options and Stock Appreciation Rights, that are settled in Common Stock, provided that notwithstanding the foregoing, shares of Common Stock added to the Plan pursuant to Section 5(a)(ii) shall be available for issuance in connection
with Awards, other than Options and Stock Appreciation Rights, that are settled in Common Stock.
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| (c) |
Reduction of Shares Available for Awards. Upon the granting of an Award,
the number of shares of Common Stock available for issuance under this Section for the granting of further Awards shall be reduced as follows:
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| (i) |
In connection with the granting of an Option or Stock Appreciation Right, the number of shares of Common Stock shall be reduced by the number of shares of Common
Stock subject to the Option or Stock Appreciation Right;
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| (ii) |
In connection with the granting of an Award that is settled in Common Stock, other than the granting of an Option or Stock Appreciation Right, the number of shares of
Common Stock shall be reduced by the number of shares of Common Stock subject to the Award; and
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| (iii) |
Awards settled in cash or property other than Common Stock shall not count against the total number of shares of Common Stock available to be granted pursuant to the
Plan.
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| (d) |
Cancelled, Forfeited or Surrendered Awards. Notwithstanding anything to the
contrary in this Plan, if any Award is cancelled, forfeited or terminated for any reason prior to exercise, delivery or becoming vested in full, the shares of Common Stock that were subject to such Award shall, to the extent cancelled,
forfeited or terminated, immediately become available for future Awards granted under this Plan, as if said Awards had never been granted; provided, however, that any shares of Common Stock subject to an Award which is cancelled, forfeited
or terminated in order to pay the exercise price of a stock option, purchase price or any taxes or tax withholdings on an Award shall not be available for future Awards granted under this Plan.
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| (e) |
Recapitalization. If the outstanding shares of Common Stock are increased
or decreased or changed into or exchanged for a different number or kind of shares or other securities by reason of any recapitalization, reclassification, reorganization, stock split, reverse split, combination of shares, exchange of
shares, stock dividend or other distribution payable in capital stock of the Company or other increase or decrease in such shares effected without receipt of consideration by the Company occurring after the Effective Date, an appropriate
and proportionate adjustment shall be made by the Committee including to: (i) the limits with respect to number and kind of shares (including, but not limited to, the limits of the number of shares of Common Stock described in Section
5(a)), (ii) the calculation of the reduction of shares of Common Stock available under the Plan, (iii) the number and kind of shares of Common Stock issuable pursuant to outstanding Awards granted under the Plan and/or (iv) the Exercise
Price of outstanding Options or Stock Appreciation Rights granted under the Plan. No fractional shares of Common Stock or units of other securities shall be issued pursuant to any such adjustment under this Section 5(e), and any fractions
resulting from any such adjustment shall be eliminated in each case by rounding downward to the nearest whole share or unit. Any adjustments made under this Section 5(e) with respect to any Incentive Stock Options must be made in accordance
with Code Section 424.
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| 6. |
OPTIONS
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| (a) |
Grant of Options. Subject to the terms and conditions of the Plan, the
Committee may grant to such Eligible Individuals as the Committee may determine, Options to purchase such number of shares of Common Stock and on such terms and conditions as the Committee shall determine in its sole and absolute
discretion. Each grant of an Option shall satisfy the requirements set forth in this Section.
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| (b) |
Type of Options. Each Option granted under the Plan may be designated by
the Committee, in its sole discretion, as either (i) an Incentive Stock Option, or (ii) a Non-Qualified Stock Option. Options designated as Incentive Stock Options that fail to continue to meet the requirements of Code Section 422 shall be
re-designated as Non-Qualified Stock Options automatically on the date of such failure to continue to meet such requirements without further action by the Committee. In the absence of any designation, Options granted under the Plan will be
deemed to be Non-Qualified Stock Options.
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| (c) |
Exercise Price. Subject to the limitations set forth in the Plan relating
to Incentive Stock Options, the Exercise Price of an Option shall be fixed by the Committee and stated in the respective Award Agreement, provided that the Exercise Price of the shares of Common Stock subject to such Option may not be less
than Fair Market Value of such Common Stock on the Grant Date, or if greater, the par value of the Common Stock.
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| (d) |
Limitation on Option Period. Subject to the limitations set forth in the
Plan relating to Incentive Stock Options, Options granted under the Plan and all rights to purchase Common Stock thereunder shall terminate no later than the tenth anniversary of the Grant Date of such Options, or on such earlier date as
may be stated in the Award Agreement relating to such Option. In the case of Options expiring prior to the tenth anniversary of the Grant Date, the Committee may in its discretion, at any time prior to the expiration or termination of said
Options, extend the term of any such Options for such additional period as it may determine, but in no event beyond the tenth anniversary of the Grant Date thereof.
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| (e) |
Limitations on Incentive Stock Options. Notwithstanding any other
provisions of the Plan, the following provisions shall apply with respect to Incentive Stock Options granted pursuant to the Plan.
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| (i) |
A maximum of 8,484,936 shares may be subject to grants of Incentive Stock Options.
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| (ii) |
Limitation on Grants. Incentive Stock Options may only be
granted to Section 424 Employees. The aggregate Fair Market Value (determined at the time such Incentive Stock Option is granted) of the shares of Common Stock for which any individual may have Incentive Stock Options which first become
vested and exercisable in any calendar year (under all incentive stock option plans of the Company) shall not exceed $100,000. Options granted to such individual in excess of the $100,000 limitation, and any Options issued subsequently
which first become vested and exercisable in the same calendar year, shall automatically be treated as Non-Qualified Stock Options.
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| (iii) |
Minimum Exercise Price. In no event may the Exercise Price of
a share of Common Stock subject an Incentive Stock Option be less than 100% of the Fair Market Value of such share of Common Stock on the Grant Date.
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| (iv) |
Ten Percent Stockholder. Notwithstanding any other provision
of the Plan to the contrary, in the case of Incentive Stock Options granted to a Section 424 Employee who, at the time the Option is granted, owns (after application of the rules set forth in Code Section 424(d)) stock possessing more than
ten percent of the total combined voting power of all classes of stock of the Company, such Incentive Stock Options (i) must have an Exercise Price per share of Common Stock that is at least 110% of the Fair Market Value as of the Grant
Date of a share of Common Stock, and (ii) must not be exercisable after the fifth anniversary of the Grant Date.
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| (f) |
Vesting Schedule and Conditions. No Options may be exercised prior to the
satisfaction of the conditions and vesting schedule provided for in the Plan and in the Award Agreement relating thereto. Except as otherwise provided by the Committee, Options covered by any Award under this Plan that are subject solely to
a future service requirement shall vest, subject to Sections 10, 12 and 13 of the Plan, as follows: (i) 20% of the Options subject to an Award shall vest immediately upon the Grant Date; and (ii) the remaining 80% of the Options subject to
an Award shall vest over the four-year period immediately following the Grant Date in equal annual increments of 20%, with one increment vesting on each anniversary date of the Grant Date.
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| (g) |
Exercise. When the conditions to the exercise of an Option have been
satisfied, the Participant may exercise the Option only in accordance with the following provisions. The Participant shall deliver to the Company a written notice stating that the Participant is exercising the Option and specifying the
number of shares of Common Stock which are to be purchased pursuant to the Option, and such notice shall be accompanied by payment in full of the Exercise Price of the shares for which the Option is being exercised, by one or more of the
methods provided for in the Plan. Said notice must be delivered to the Company at its principal office and addressed to the attention of the Chief Financial Officer. An attempt to exercise any Option granted hereunder other than as set
forth in the Plan shall be invalid and of no force and effect.
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| (h) |
Payment. Payment of the Exercise Price for the shares of Common Stock
purchased pursuant to the exercise of an Option shall be made by one of the following methods:
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| (i) |
by cash, certified or cashier’s check, bank draft or money order;
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| (ii) |
through the delivery to the Company of shares of Common Stock which have been previously owned by the Participant for the requisite period necessary to avoid a charge
to the Company’s earnings for financial reporting purposes; such shares shall be valued, for purposes of determining the extent to which the Exercise Price has been paid thereby, at their Fair Market Value on the date of exercise; without
limiting the foregoing, the Committee may require the Participant to furnish an opinion of counsel acceptable to the Committee to the effect that such delivery would not result in the Company incurring any liability under Section 16(b) of
the Exchange Act; or
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| (iii) |
by any other method which the Committee, in its sole and absolute discretion and to the extent permitted by applicable law, may permit, including, but not limited to
through a “cashless exercise sale and remittance procedure” pursuant to which the Participant shall concurrently provide irrevocable instructions (1) to a brokerage firm approved by the Committee to effect the immediate sale of the
purchased shares and remit to the Company, out of the sale proceeds available on the settlement date, sufficient funds to cover the aggregate Exercise Price payable for the purchased shares plus all applicable federal, state and local
income, employment, excise, foreign and other taxes required to be withheld by the Company by reason of such exercise and (2) to the Company to deliver the certificates for the purchased shares directly to such brokerage firm in order to
complete the sale.
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| (i) |
Termination of Employment. Unless otherwise provided in an Award Agreement,
upon the termination of the employment and other service of a Participant with the Company Group for any reason, all of the Participant’s outstanding Options (whether vested or unvested) shall be subject to the rules of this paragraph. Upon
such termination, the Participant’s unvested Options shall expire. Notwithstanding anything in this Plan to the contrary, the Committee may provide, in its sole and absolute discretion, that following the termination of employment and other
service of a Participant with the Company Group for any reason (i) any unvested Options held by the Participant that vest solely upon a future service requirement shall vest in whole or in part, at any time subsequent to such termination of
employment and other service, and/or (ii) a Participant or the Participant’s estate, devisee or heir at law (whichever is applicable), may exercise an Option, in whole or in part, at any time subsequent to such termination of employment and
other service and prior to the termination of the Option pursuant to its terms that are unrelated to termination of service. Unless otherwise determined by the Committee, temporary absence from employment and other service because of
illness, vacation, approved leaves of absence or military service shall not constitute a termination of employment or other service.
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| (i) |
Termination for Reason other than Cause, Disability or Death. If
a Participant’s termination of employment and other service is for any reason other than death, Disability, Cause and other service by the Company for Cause, any Option held by such Participant may be exercised, to the extent exercisable at
termination, by the Participant at any time within a period not to exceed ninety (90) days from the date of such termination, but in no event after the termination of the Option pursuant to its terms that are unrelated to termination of
service.
|
| (ii) |
Disability. If a Participant’s termination of employment and
other service with the Company is by reason of a Disability of such Participant, any Option held by such Participant may be exercised, to the extent exercisable at termination, by the Participant at any time within a period not to exceed
one (1) year after such termination, but in no event after the termination of the Option pursuant to its terms that are unrelated to termination of service; provided, however, that if the Participant dies within such period, any vested
Option held by such Participant upon death shall be exercisable by the Participant’s estate, devisee or heir at law (whichever is applicable) for a period not to exceed one (1) year after the Participant’s death, but in no event after the
termination of the Option pursuant to its terms that are unrelated to termination of service.
|
| (iii) |
Death. If a Participant dies while in the employment or other
service of the Company, any Option held by such Participant may be exercised, to the extent exercisable at termination, by the Participant’s estate or the devisee named in the Participant’s valid last will and testament or the Participant’s
heir at law who inherits the Option, at any time within a period not to exceed one (1) year after the date of such Participant’s death, but in no event after the termination of the Option pursuant to its terms that are unrelated to
termination of service.
|
6
| (iv) |
Termination for Cause. In the event the termination is for
Cause, any Option held by the Participant at the time of such termination shall be deemed to have terminated and expired upon the date of such termination.
|
| 7. |
STOCK APPRECIATION RIGHTS
|
| (a) |
Grant of Stock Appreciation Rights. Subject to the terms and conditions of
the Plan, the Committee may grant to such Eligible Individuals as the Committee may determine, Stock Appreciation Rights, in such amounts and on such terms and conditions, as the Committee shall determine in its sole and absolute
discretion. Each grant of a Stock Appreciation Right shall satisfy the requirements as set forth in this Section.
|
| (b) |
Terms and Conditions of Stock Appreciation Rights. Unless otherwise
provided in an Award Agreement, the terms and conditions (including, without limitation, the limitations on the Exercise Price, exercise period, repricing and termination) of the Stock Appreciation Right shall be substantially identical (to
the extent possible taking into account the differences related to the character of the Stock Appreciation Right) to the terms and conditions that would have been applicable under Section 6 above were the grant of the Stock Appreciation
Rights a grant of an Option.
|
| (c) |
Exercise of Stock Appreciation Rights. Stock Appreciation Rights shall be
exercised by a Participant only by written notice delivered to the Chief Executive Officer or the Chief Financial Officer of the Company, specifying the number of shares of Common Stock with respect to which the Stock Appreciation Right is
being exercised.
|
| (d) |
Payment of Stock Appreciation Right. Unless otherwise provided in an Award
Agreement, upon exercise of a Stock Appreciation Right, the Participant or Participant’s estate, devisee or heir at law (whichever is applicable) shall be entitled to receive payment, in cash, in shares of Common Stock, or in a combination
thereof, as determined by the Committee in its sole and absolute discretion. The amount of such payment shall be determined by multiplying the excess, if any, of the Fair Market Value of a share of Common Stock on the date of exercise over
the Fair Market Value of a share of Common Stock on the Grant Date, by the number of shares of Common Stock with respect to which the Stock Appreciation Rights are then being exercised. Notwithstanding the foregoing, the Committee may limit
in any manner the amount payable with respect to a Stock Appreciation Right by including such limitation in the Award Agreement.
|
| 8. |
RESTRICTED STOCK
|
| (a) |
Grant of Restricted Stock. Subject to the terms and conditions of the Plan,
the Committee may grant to such Eligible Individuals as the Committee may determine, Restricted Stock, in such amounts and on such terms and conditions as the Committee shall determine in its sole and absolute discretion. Each grant of
Restricted Stock shall satisfy the requirements as set forth in this Section.
|
| (b) |
Restrictions. The Committee shall impose such restrictions on any
Restricted Stock granted pursuant to the Plan as it may deem advisable including, without limitation, time-based vesting restrictions or the attainment of Performance Goals. Except as otherwise provided by the Committee in its sole and
absolute discretion and subject to Sections 10, 12 and 13 of the Plan, Restricted Stock covered by any Award under this Plan that are subject solely to a future service requirement shall vest over the four-year period immediately following
the Grant Date in equal annual increments of 25%, with one increment vesting on each anniversary date of the Grant Date.
|
7
| (c) |
Certificates and Certificate Legend. With respect to a grant of Restricted
Stock, the Company may issue a certificate evidencing such Restricted Stock to the Participant or issue and hold such shares of Restricted Stock for the benefit of the Participant until the applicable restrictions expire. The Company may
legend the certificate representing Restricted Stock to give appropriate notice of such restrictions. In addition to any such legends, each certificate representing shares of Restricted Stock granted pursuant to the Plan shall bear the
following legend:
|
“Shares of stock represented by this certificate are subject to certain terms, conditions, and restrictions on transfer as set forth
in the Brooklyn ImmunoTherapeutics, Inc. Restated 2020 Stock Incentive Plan (the “Plan”), and in an agreement entered into by and between the registered owner of such shares and Brooklyn ImmunoTherapeutics, Inc. (the “Company”), dated , 202_ (the
“Award Agreement”). A copy of the Plan and the Award Agreement may be obtained from the Secretary of the Company.”
| (d) |
Removal of Restrictions. Except as otherwise provided in the Plan or the
Award Agreement, shares of Restricted Stock shall become freely transferable by the Participant upon the lapse of the applicable restrictions. Once the shares of Restricted Stock are released from the restrictions, the Participant shall be
entitled to have the legend required by paragraph (c) above removed from the share certificate evidencing such Restricted Stock and the Company shall pay or distribute to the Participant all dividends and distributions held in escrow by the
Company with respect to such Restricted Stock, if any.
|
| (e) |
Stockholder Rights. Unless otherwise provided in an Award Agreement, until
the expiration of all applicable restrictions, (i) the Restricted Stock shall be treated as outstanding, (ii) the Participant holding shares of Restricted Stock may exercise full voting rights with respect to such shares, and (iii) the
Participant holding shares of Restricted Stock shall be entitled to receive all dividends and other distributions paid with respect to such shares while they are so held. All dividends and distributions shall be held in escrow by the
Company (subject to the same restrictions on forfeitability) until all restrictions on the respective Restricted Stock have lapsed. If any such dividends or distributions are paid in shares of Common Stock, such shares shall be subject to
the same restrictions on transferability and forfeitability as the shares of Restricted Stock with respect to which they were paid.
|
| (f) |
Termination of Service. Unless otherwise provided in an Award Agreement, if
a Participant’s employment and other service with the Company terminates for any reason, all unvested shares of Restricted Stock held by the Participant and any dividends or distributions held in escrow by the Company with respect to such
Restricted Stock shall be forfeited immediately and returned to the Company. Notwithstanding this paragraph, all grants of Restricted Stock that vest solely upon the attainment of Performance Goals shall be treated pursuant to the terms and
conditions that would have been applicable under Section 9 as if such grants of Restricted Stock were Awards of Performance Shares, to the extent such terms and conditions are applicable to shares of Restricted Stock. Notwithstanding
anything in this Plan to the contrary, the Committee may provide, in its sole and absolute discretion, that following the termination of employment and other service of a Participant with the Company for any reason, any unvested shares of
Restricted Stock held by the Participant that vest solely upon a future service requirement shall vest in whole or in part, at any time subsequent to such termination of employment and other service.
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8
| 9. |
PERFORMANCE SHARES, PERFORMANCE UNITS AND RSUs
|
| (a) |
Grant of Performance Shares, Performance Units and RSUs. Subject to the
terms and conditions of the Plan, the Committee may grant to such Eligible Individuals as the Committee may determine, Performance Shares, Performance Units and RSUs, in such amounts and on such terms and conditions as the Committee shall
determine in its sole and absolute discretion. Each grant of a Performance Share, a Performance Unit or an RSU shall satisfy the requirements as set forth in this Section.
|
| (b) |
Performance Goals. Performance Goals will be based on one or more of the
following criteria, as determined by the Committee in its absolute and sole discretion: (i) the attainment of certain target levels of, or a specified increase in, the Company’s enterprise value or value creation targets; (ii) the
attainment of certain target levels of, or a percentage increase in, the Company’s after-tax or pre-tax profits including, without limitation, that attributable to the Company’s continuing and/or other operations; (iii) the attainment of
certain target levels of, or a specified increase relating to, the Company’s operational cash flow or working capital, or a component thereof; (iv) the attainment of certain target levels of, or a specified decrease relating to, the
Company’s operational costs, or a component thereof; (v) the attainment of a certain level of reduction of, or other specified objectives with regard to limiting the level of increase in all or a portion of bank debt or other of the
Company’s long-term or short-term public or private debt or other similar financial obligations of the Company, which may be calculated net of cash balances and/or other offsets and adjustments as may be established by the Committee; (vi)
the attainment of a specified percentage increase in earnings per share or earnings per share from the Company’s continuing operations; (vii) the attainment of certain target levels of, or a specified percentage increase in, the Company’s
net sales, revenues, net income or earnings before income tax or other exclusions; (viii) the attainment of certain target levels of, or a specified increase in, the Company’s return on capital employed or return on invested capital; (ix)
the attainment of certain target levels of, or a percentage increase in, the Company’s after-tax or pre-tax return on stockholder equity; (x) the attainment of certain target levels in the fair market value of the Company’s Common Stock;
(xi) the growth in the value of an investment in the Common Stock assuming the reinvestment of dividends; (xii) the attainment of certain target levels of, or a specified increase in, EBITDA (earnings before income tax, depreciation and
amortization); and/or attainment of synergies and cost reductions in connection with mergers, acquisitions and similar corporate transactions involving the Company. In addition, Performance Goals may be based upon the attainment by a
subsidiary, division or other operational unit of the Company of specified levels of performance under one or more of the measures described above. Further, the Performance Goals may be based upon the attainment by the Company (or a
subsidiary, division, facility or other operational unit of the Company) of specified levels of performance under one or more of the foregoing measures relative to the performance of other corporations. Performance Goals may include a
threshold level of performance below which no Award will be earned, levels of performance at which an Award will become partially earned and a level at which an Award will be fully earned.
|
| (c) |
Terms and Conditions.
|
| (i) |
Performance Shares and Performance Units. The applicable
Award Agreement shall set forth (A) the number of Performance Shares or the dollar value of Performance Units granted to the Participant; (B) the Performance Period and Performance Goals with respect to each such Award; (C) the threshold,
target and maximum shares of Common Stock or dollar values of each Performance Share or Performance Unit and corresponding Performance Goals; and (D) any other terms and conditions as the Committee determines in its sole and absolute
discretion. The Committee shall establish, in its sole and absolute discretion, the Performance Goals for the applicable Performance Period for each Performance Share or Performance; Unit granted hereunder. Performance Goals for different
Participants and for different grants of Performance Shares and Performance Units need not be identical. Unless otherwise provided in an Award Agreement, a holder of Performance Shares or Performance Units is not entitled to the rights of a
holder of Common Stock.
|
9
| (ii) |
RSUs. The applicable Award Agreement shall set forth such
terms and conditions with respect to the RSUs as the Committee may impose, including restrictions on transferability, risk of forfeiture and other restrictions, if any, which restrictions may lapse separately or in combination at such
times, under such circumstances, in such installments or otherwise and under such other circumstances as the Committee may determine at the date of grant or thereafter.
|
| (d) |
Determination and Payment.
|
| (i) |
Performance Shares or Performance Units Earned. Following the
end of a Performance Period, the Committee shall determine the extent to which Performance Shares or Performance Units have been earned on the basis of the Company’s actual performance in relation to the established Performance Goals as set
forth in the applicable Award Agreement and shall certify these results in writing. Unless otherwise provided in the Award Agreement, the payment with respect to Performance Shares or Performance Units shall be made within 60 days following
the end of the applicable Performance Period. Unless otherwise provided in an Award Agreement, the Committee shall determine in its sole and absolute discretion whether payment with respect to the Performance Share or Performance Unit shall
be made in cash, in shares of Common Stock, or in a combination thereof.
|
| (ii) |
RSUs. Unless provided otherwise in the Award Agreement,
Restricted Stock Units shall be paid within 60 days following the date on which the restrictions on the RSUs lapse.
|
| (e) |
Termination of Employment. Unless otherwise provided in an Award
Agreement, if a Participant’s employment and other service with the Company terminates for any reason, all of the Participant’s outstanding RSUs that remain subject to restrictions as of the date of such termination shall be forfeited and
Performance Shares and Performance Units shall be subject to the rules of paragraph (i) and (ii) of this Section 9(e).
|
| (i) |
Termination for Reason Other Than Death or Disability. If a
Participant’s employment or other service with the Company terminates prior to the expiration of a Performance Period with respect to any Performance Units or Performance Shares held by such Participant for any reason other than death or
Disability, the outstanding Performance Units or Performance Shares held by such Participant for which the Performance Period has not yet expired shall terminate upon such termination and the Participant shall have no further rights
pursuant to such Performance Units or Performance Shares.
|
| (ii) |
Termination of Employment for Death or Disability. If a
Participant’s employment or other service with the Company terminates by reason of the Participant’s death or Disability prior to the end of a Performance Period, the Participant, or the Participant’s estate, devisee or heir at law
(whichever is applicable) shall be entitled to a payment of the Participant’s outstanding Performance Units and Performance Shares, pursuant to the terms of the Plan and the Participant’s Award Agreement; provided, however, that the
Participant shall be deemed to have earned only that proportion (to the nearest whole unit or share) of the Performance Units or Performance Shares granted to the Participant under such Award as the number of full months of the Performance
Period which have elapsed since the first day of the Performance Period for which the Award was granted to the end of the month in which the Participant’s termination of employment or other service, bears to the total number of months in
the Performance Period, subject to the attainment of the Performance Goals associated with the Award as certified by the Committee. The remaining Performance Units or Performance Shares and any rights with respect thereto shall be canceled
and forfeited.
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10
| 10. |
VESTING OF AWARD GRANTS TO NON-EMPLOYEE DIRECTORS
|
Notwithstanding the minimum vesting provisions in Section 6(f) and 8(b) of the Plan, any Award granted to a Non-Employee Director
in lieu of cash compensation shall not be subject to any minimum vesting requirements.
| 11. |
OTHER AWARDS
|
Awards of shares of Common Stock, phantom stock and other Awards that are valued in whole or in part by reference to, or otherwise
based on, Common Stock, may also be made, from time to time, to Eligible Individuals as may be selected by the Committee. Such Awards may be issued in satisfaction of Awards granted under any other plan sponsored by the Company or compensation
payable to an Eligible Individual. In addition, such Awards may be made alone or in addition to or in connection with any other Award granted hereunder. The Committee may determine the terms and conditions of any such Award, including conditioning
such Awards on achievement of Performance Goals. Each such Award shall be evidenced by an Award Agreement between the Eligible Individual and the Company which shall specify the number of shares of Common Stock subject to the Award, any
consideration therefore, any vesting or performance requirements and such other terms and conditions as the Committee shall determine in its sole and absolute discretion.
| 12. |
CHANGE IN CONTROL
|
Upon the occurrence of a Change in Control of the Company, the Committee may in its sole and absolute discretion, provide on a case
by case basis that (i) some or all outstanding Awards may become immediately exercisable or vested, without regard to any limitation imposed pursuant to this Plan, (ii) that all Awards shall terminate, provided that Participants shall have the
right, immediately prior to the occurrence of such Change in Control and during such reasonable period as the Committee in its sole discretion shall determine and designate, to exercise any vested Award in whole or in part, (iii) that all Awards
shall terminate, provided that Participants shall be entitled to a cash payment equal to the Change in Control Price with respect to shares subject to the vested portion of the Award net of the Exercise Price thereof, if applicable, (iv) provide
that, in connection with a liquidation or dissolution of the Company, Awards, to the extent vested, shall convert into the right to receive liquidation proceeds net of the Exercise Price (if applicable), (v) accelerate the vesting of Awards, and
(vi) any combination of the foregoing. In the event that the Committee does not terminate or convert an Award upon a Change in Control of the Company, then the Award shall be assumed, or substantially equivalent Awards shall be substituted, by the
acquiring, or succeeding corporation (or an affiliate thereof).
11
| 13. |
CHANGE IN STATUS OF PARENT OR SUBSIDIARY
|
Unless otherwise provided in an Award Agreement or otherwise determined by the Committee, in the event that an entity or business
unit which was previously a part of the Company is no longer a part of the Company, as determined by the Committee in its sole discretion, the Committee may, in its sole and absolute discretion: (i) provide on a case by case basis that some or all
outstanding Awards held by a Participant employed by or performing service for such entity or business unit may become immediately exercisable or vested, without regard to any limitation imposed pursuant to this Plan; (ii) provide on a case by case
basis that some or all outstanding Awards held by a Participant employed by or performing service for such entity or business unit may remain outstanding, may continue to vest, and/or may remain exercisable for a period not exceeding one year,
subject to the terms of the Award Agreement and this Plan; and/or (iii) treat the employment or other services of a Participant performing services for such entity or business unit as terminated if such Participant is not employed by Company or any
entity that is a part of the Company immediately after such event.
| 14. |
REQUIREMENTS OF LAW
|
| (a) |
Violations of Law. The Company shall not be required to make any payments,
sell or issue any shares of Common Stock under any Award if the sale or issuance of such shares would constitute a violation by the individual exercising the Award, the Participant or the Company of any provisions of any law or regulation
of any governmental authority, including without limitation any provisions of the Sarbanes-Oxley Act, and any other federal or state securities laws or regulations. Any determination in this connection by the Committee shall be final,
binding, and conclusive. The Company shall not be obligated to take any affirmative action in order to cause the exercise of an Award, the issuance of shares pursuant thereto, or the grant of an Award to comply with any law or regulation of
any governmental authority.
|
| (b) |
Registration. At the time of any exercise or receipt of any Award, the
Company may, if it shall determine it necessary or desirable for any reason, require the Participant (or Participant’s heirs, legatees or legal representative, as the case may be), as a condition to the exercise or grant thereof, to deliver
to the Company a written representation of present intention to hold the shares for their own account as an investment and not with a view to, or for sale in connection with, the distribution of such shares, except in compliance with
applicable federal and state securities laws with respect thereto. In the event such representation is required to be delivered, an appropriate legend may be placed upon each certificate delivered to the Participant (or Participant’s heirs,
legatees or legal representative, as the case may be) upon the Participant’s exercise of part or all of the Award or receipt of an Award and a stop transfer order may be placed with the transfer agent. Each Award shall also be subject to
the requirement that, if at any time the Company determines, in its discretion, that the listing, registration or qualification of the shares subject to the Award upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental regulatory body, is necessary or desirable as a condition of or in connection with, the issuance or purchase of the shares thereunder, the Award may not be exercised in whole or in part and the
restrictions on an Award may not be removed unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Company in its sole discretion. The
Participant shall provide the Company with any certificates, representations and information that the Company requests and shall otherwise cooperate with the Company in obtaining any listing, registration, qualification, consent or approval
that the Company deems necessary or appropriate. The Company shall not be obligated to take any affirmative action in order to cause the exercisability or vesting of an Award, to cause the exercise of an Award or the issuance of shares
pursuant thereto, or to cause the grant of Award to comply with any law or regulation of any governmental authority.
|
12
| (c) |
Withholding. The Committee may make such provisions and take such steps as
it may deem necessary or appropriate for the withholding of any taxes that the Company is required by any law or regulation of any governmental authority, whether federal, state or local, domestic or foreign, to withhold in connection with
the grant or exercise of an Award, or the removal of restrictions on an Award including, but not limited to: (i) the withholding of delivery of shares of Common Stock until the holder reimburses the Company for the amount the Company is
required to withhold with respect to such taxes; (ii) the canceling of any number of shares of Common Stock issuable in an amount sufficient to reimburse the Company for the amount it is required to so withhold; (iii) withholding the amount
due from any such person’s wages or compensation due to such person; or (iv) requiring the Participant to pay the Company cash in the amount the Company is required to withhold with respect to such taxes.
|
| (d) |
Governing Law. The Plan shall be governed by, and construed and enforced in
accordance with, the laws of the State of Delaware.
|
| 15. |
GENERAL PROVISIONS
|
| (a) |
Award Agreements. All Awards granted pursuant to the Plan shall be
evidenced by an Award Agreement. Each Award Agreement shall specify the terms and conditions of the Award granted and shall contain any additional provisions as the Committee shall deem appropriate, in its sole and absolute discretion
(including, to the extent that the Committee deems appropriate, provisions relating to confidentiality, non-competition, non-solicitation and similar matters). The terms of each Award Agreement need not be identical for Eligible Individuals
provided that each Award Agreement shall comply with the terms of the Plan.
|
| (b) |
Exemptions from Section 16(b) Liability. It is the intent of the Company
that the grant of any Awards to or other transaction by a Participant who is subject to Section 16 of the Exchange Act shall be exempt from Section 16 pursuant to an applicable exemption (except for transactions acknowledged in writing to
be non-exempt by such Participant and sales transactions to persons other than the Company). Accordingly, if any provision of this Plan or any Award Agreement does not comply with the requirements of Rule 16b-3 then applicable to any such
transaction, such provision shall be construed or deemed amended to the extent necessary to conform to the applicable requirements of Rule 16b-3 so that such Participant shall avoid liability under Section 16(b). In the event Rule 16b-3 is
revised or replaced, the Board, or the Committee acting on behalf of the Board, may exercise discretion to modify this Plan in any respect necessary to satisfy the requirements of the revised exemption or its replacement.
|
| (c) |
Purchase Price. To the extent the purchase price of any Award granted
hereunder is less than par value of a share of Common Stock and such purchase price is not permitted by applicable law, the per share purchase price shall be deemed to be equal to the par value of a share of Common Stock.
|
| (d) |
Deferral of Awards. The Committee may from time to time establish
procedures pursuant to which a Participant may elect to defer, until a time or times later than the vesting of an Award, receipt of all or a portion of the shares of Common Stock or cash subject to such Award and to receive Common Stock or
cash at such later time or times, all on such terms and conditions as the Committee shall determine. The Committee shall not permit the deferral of an Award unless counsel for the Company determines that such action will not result in
adverse tax consequences to a Participant under Section 409A of the Code. If any such deferrals are permitted, then notwithstanding anything to the contrary herein, a Participant who elects to defer receipt of Common Stock shall not have
any rights as a stockholder with respect to deferred shares of Common Stock unless and until shares of Common Stock are actually delivered to the Participant with respect thereto, except to the extent otherwise determined by the Committee.
|
13
| (e) |
Prospective Employees. Notwithstanding anything to the contrary, any Award
granted to a Prospective Employee shall not become vested prior to the date the Prospective Employee first becomes an employee of the Company.
|
| (f) |
Stockholder Rights. Except as expressly provided in the Plan or an Award
Agreement, a Participant shall not have any of the rights of a stockholder with respect to Common Stock subject to the Awards prior to satisfaction of all conditions relating to the issuance of such Common Stock, and no adjustment shall be
made for dividends, distributions or other rights of any kind for which the record date is prior to the date on which all such conditions have been satisfied.
|
| (g) |
Transferability of Awards. A Participant may not Transfer an Award other
than by will or the laws of descent and distribution. Awards may be exercised during the Participant’s lifetime only by the Participant. No Award shall be liable for or subject to the debts, contracts, or liabilities of any Participant, nor
shall any Award be subject to legal process or attachment for or against such person. Any purported Transfer of an Award in contravention of the provisions of the Plan shall have no force or effect and shall be null and void, and the
purported transferee of such Award shall not acquire any rights with respect to such Award. Notwithstanding anything to the contrary, the Committee may in its sole and absolute discretion permit the Transfer of an Award to a Participant’s
“family member” as such term is defined in the Form S-8 Registration Statement under the Securities Act of 1933, as amended, under such terms and conditions as specified by the Committee; provided, however, that the Participant will not
directly or indirectly receive any payment of value in connection with the transfer of the Award. In such case, such Award shall be exercisable only by the transferee approved of by the Committee. To the extent that the Committee permits
the Transfer of an Incentive Stock Option to a “family member”, so that such Option fails to continue to satisfy the requirements of an incentive stock option under the Code such Option shall automatically be re-designated as a
Non-Qualified Stock Option.
|
| (h) |
Buyout and Settlement Provisions. Except as prohibited hereunder, the
Committee may at any time on behalf of the Company offer to buy out any Awards previously granted based on such terms and conditions as the Committee shall determine which shall be communicated to the Participants at the time such offer is
made.
|
| (i) |
Use of Proceeds. The proceeds received by the Company from the sale of
Common Stock pursuant to Awards granted under the Plan shall constitute general funds of Company.
|
| (j) |
Modification or Substitution of an Award.
|
| (i) |
Generally. Subject to the terms and conditions of the Plan,
the Award Agreement and applicable law (including the Code), the Committee may modify outstanding Awards, provided that, except as permitted in the Plan or the applicable Award Agreement, no modification of an Award shall materially
adversely affect any rights or obligations of the Participant under the applicable Award Agreement without the Participant’s consent. Nothing in the Plan shall limit the right of the Company to pay compensation of any kind outside the terms
of the Plan.
|
14
| (ii) |
Limitation on Repricing. Unless such action is approved by
the Company’s shareholders in accordance with applicable law: (i) no outstanding Option or Stock Appreciation Right granted under the Plan may be amended to provide an Exercise Price that is lower than the then-current Exercise Price of
such outstanding Option or Stock Appreciation Right (other than adjustments to the Exercise Price pursuant to Sections 5(e) and 12); (ii) the Committee may not cancel any outstanding Option or Stock Appreciation Right when its Exercise
Price is equal to or greater than the Fair Market Value of the underlying Common Stock and grant in substitution therefore new Awards, equity, cash or other property (other than adjustments pursuant to Section 12); (iii) the Committee may
not authorize the repurchase of an outstanding Option or Stock Appreciation Right which has an Exercise Price that is higher than the then-current fair market value of the Common Stock (other than adjustments pursuant to Section 12); (iv)
the Committee may not cancel any outstanding Option or Stock Appreciation Right and grant in substitution therefore new Awards as part of a strategy to materially enhance the position of the holder of such Options or Stock Appreciation
Rights with respect to their value as of the time of such substitution (other than adjustments pursuant to Section 12), and (v) the Committee may not take any other action that is treated as a repricing under generally accepted accounting
principles (other than adjustments pursuant to Sections 5(e) and 12). A cancellation and exchange or substitution described in clauses (ii) and (iv) of the preceding sentence will be considered a repricing regardless of whether the Option,
Restricted Stock or other equity is delivered simultaneously with the cancellation, regardless of whether it is treated as a repricing under generally accepted accounting principles, and regardless of whether it is voluntary on the part of
the Participant.
|
| (k) |
Amendment and Termination of Plan. The Board may, at any time and from time
to time, amend, suspend or terminate the Plan as to any shares of Common Stock as to which Awards have not been granted; provided, however, that
the approval of the stockholders of the Company in accordance with applicable law and the Articles of Incorporation and Bylaws of the Company shall be required for any amendment (other than those permitted under Section 5 or 12): (i) that
changes the class of individuals eligible to receive Awards under the Plan; (ii) that increases the maximum number of shares of Common Stock in the aggregate that may be subject to Awards that are granted under the Plan (except as permitted
under Section 5 or Section 12 hereof); (iii) the approval of which is necessary to comply with federal or state law (including without limitation Rule 16b-3 under the Exchange Act) or with the rules of any stock exchange or automated
quotation system on which the Common Stock may be listed or traded; or (iv) that proposes to eliminate a requirement provided herein that the stockholders of the Company must approve an action to be undertaken under the Plan. Except as
expressly provided in the Plan, no amendment, suspension or termination of the Plan shall, without the consent of the holder of an Award, alter or impair rights or obligations under any Award theretofore granted under the Plan. Awards
granted prior to the termination of the Plan may extend beyond the date the Plan is terminated and shall continue subject to the terms of the Plan as in effect on the date the Plan is terminated.
|
| (l) |
Section 409A of the Code. The Award Agreement for any Award that the
Committee reasonably determines to constitute “nonqualified” deferred compensation plan” under Code Section 409A (a “Section 409A Plan”), and the
provisions of the Plan applicable to that Award, shall be construed in a manner consistent with the applicable requirements of Code Section 409A, and the Committee, in its sole discretion and without the consent of any Participant, may
amend any Award Agreement (and the provisions of the Plan applicable thereto) if and to the extent that the Committee determines that such amendment is necessary or appropriate to comply with the requirements of Code Section 409A. If any
Award constitutes a Section 409A Plan, then the Award shall be subject to the following additional requirements, if and to the extent required to comply with Code Section 409A:
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15
| (i) |
Payments under the Section 409A Plan may not be made earlier than (A) the Participant’s “separation from service”, (B) the date the Participant becomes “disabled”,
(C) the Participant’s death, (D) a “specified time (or pursuant to a fixed schedule)” specified in the Award Agreement at the date of the deferral of such compensation, (E) a “change in the ownership or effective control of the corporation,
or in the ownership of a substantial portion of the assets: of the corporation, or (F) the occurrence of an “unforeseeable emergency”;
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| (ii) |
The time or schedule for any payment of the deferred compensation may not be accelerated, except to the extent provided in applicable Treasury Regulations or other
applicable guidance issued by the Internal Revenue Service;
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| (iii) |
Any elections with respect to the deferral of such compensation or the time and form of distribution of such deferred compensation shall comply with the requirements
of Code Section 409A(a)(4); and
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| (iv) |
In the case of any Participant who is a “specified employee”, a distribution on account of a “separation from service” may not be made before the date which is six
months after the date of the Participant’s “separation from service” (or, if earlier, the date of the Participant’s death).
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| (v) |
For purposes of the foregoing, the terms in quotations shall have the same meanings as those terms have for purposes of Code Section 409A, and the limitations set
forth herein shall be applied in such manner (and only to the extent) as shall be necessary to comply with any requirements of Code Section 409A that are applicable to the Award.
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| (m) |
Notification of 83(b) Election. If in connection with the grant of any
Award, any Participant makes an election permitted under Code Section 83(b), such Participant must notify the Company in writing of such election within ten days of filing such election with the Internal Revenue Service.
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| (n) |
Detrimental Activity. All Awards shall be subject to cancellation by the
Committee in accordance with the terms of this Section 15(n) if the Participant engages in any Detrimental Activity. To the extent that a Participant engages in any Detrimental Activity at any time prior to, or during the one year period
after, any exercise or vesting of an Award but prior to a Change in Control, the Company shall, upon the recommendation of the Committee, in its sole and absolute discretion, be entitled to (i) immediately terminate and cancel any Awards
held by the Participant that have not yet been exercised, and/or (ii) with respect to Awards of the Participant that have been previously exercised, recover from the Participant at any time within two years after such exercise but prior to
a Change in Control (and the Participant shall be obligated to pay over to the Company with respect to any such Award previously held by such Participant): (A) with respect to any Options exercised, an amount equal to the excess of the Fair
Market Value of the Common Stock for which any Option was exercised over the Exercise Price paid (regardless of the form by which payment was made) with respect to such Option; (B) with respect to any Award other than an Option, any shares
of Common Stock granted and vested pursuant to such Award, and if such shares are not still owned by the Participant, the Fair Market Value of such shares on the date they were issued, or if later, the date all vesting restrictions were
satisfied; and (C) any cash or other property (other than Common Stock) received by the Participant from the Company pursuant to an Award. Without limiting the generality of the foregoing, in the event that a Participant engages in any
Detrimental Activity at any time prior to any exercise of an Award and the Company exercises its remedies pursuant to this Section 15(n) following the exercise of such Award, such exercise shall be treated as having been null and void,
provided that the Company will nevertheless be entitled to recover the amounts referenced above.
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| (o) |
Disclaimer of Rights. No provision in the Plan, any Award granted
hereunder, or any Award Agreement entered into pursuant to the Plan shall be construed to confer upon any individual the right to remain in the employ of or other service with the Company or to interfere in any way with the right and
authority of the Company either to increase or decrease the compensation of any individual, including any holder of an Award, at any time, or to terminate any employment or other relationship between any individual and the Company. The
grant of an Award pursuant to the Plan shall not affect or limit in any way the right or power of the Company to make adjustments, reclassifications, reorganizations or changes of its capital or business structure or to merge, consolidate,
dissolve or liquidate, or to sell or transfer all or any part of its business or assets.
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| (p) |
Unfunded Status of Plan. The Plan is intended to constitute an “unfunded”
plan for incentive and deferred compensation. With respect to any payments as to which a Participant has a fixed and vested interest but which are not yet made to such Participant by the Company, nothing contained herein shall give any such
Participant any rights that are greater than those of a general creditor of the Company
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| (q) |
Nonexclusivity of Plan. The adoption of the Plan shall not be construed as
creating any limitations upon the right and authority of the Board to adopt such other incentive compensation arrangements (which arrangements may be applicable either generally to a class or classes of individuals or specifically to a
particular individual or individuals) as the Board in its sole and absolute discretion determines desirable.
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| (r) |
Other Benefits. No Award payment under the Plan shall be deemed
compensation for purposes of computing benefits under any retirement plan of the Company or any agreement between a Participant and the Company, nor affect any benefits under any other benefit plan of the Company now or subsequently in
effect under which benefits are based upon a Participant’s level of compensation.
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| (s) |
Headings. The section headings in the Plan are for convenience only; they
form no part of this Agreement and shall not affect its interpretation.
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| (t) |
Pronouns. The use of any gender in the Plan shall be deemed to include all
genders, and the use of the singular shall be deemed to include the plural and vice versa, wherever it appears appropriate from the context.
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| (u) |
Successors and Assigns. The Plan shall be binding on all successors of the
Company and all successors and permitted assigns of a Participant, including, but not limited to, a Participant’s estate, devisee, or heir at law.
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| (v) |
Severability. If any provision of the Plan or any Award Agreement shall be
determined to be illegal or unenforceable by any court of law in any jurisdiction, the remaining provisions hereof and thereof shall be severable and enforceable in accordance with their terms, and all provisions shall remain enforceable in
any other jurisdiction.
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| (w) |
Notices. Any communication or notice required or permitted to be given
under the Plan shall be in writing, and mailed by registered or certified mail or delivered by hand, to the Company, to its principal place of business, attention: Chief Financial Officer and if to the holder of an Award, to the address as
appearing on the records of the Company.
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APPENDIX A
DEFINITIONS
“Award” means any Common Stock, Option, Performance Share, Performance Unit, Restricted Stock, RSUs, Stock Appreciation Right or
any other award granted pursuant to the Plan.
“Award Agreement” means a written agreement entered into by the Company and a Participant setting forth the terms and conditions of
the grant of an Award to such Participant.
“Board” means the board of directors of the Company.
“Cause” means, with respect to a termination of employment or other service with the Company Group, a termination of employment or
other service due to a Participant’s dishonesty, fraud, insubordination, willful misconduct, refusal to perform services (for any reason other than illness or incapacity) or materially unsatisfactory performance of the Participant’s duties for the
Company Group, including a voluntary termination within ninety (90) days after occurrence of an event which would be grounds for termination of employment or other service by the Company Group for Cause (without regard to any notice or cure period
requirement); provided, however, that if the Participant and the Company Group have entered into an employment agreement or consulting
agreement which defines the term Cause, the term Cause shall be defined in accordance with such agreement with respect to any Award granted to the Participant on or after the effective date of the respective employment or consulting agreement. The
Committee shall determine in its sole and absolute discretion whether Cause exists for purposes of the Plan.
“Change in Control” shall be deemed to occur upon occurrence of any of the following after the Effective Date:
| (a) |
any “person” as such term is used in Sections 13(d) and 14(d) of the Exchange Act (other than the Company, any trustee or other fiduciary holding securities under any
employee benefit plan of the Company, any company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of common stock of the Company is or becomes the “beneficial owner”
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the combined voting power of the Company’s then outstanding securities;
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| (b) |
during any period of two (2) consecutive years, individuals who at the beginning of such period constitute the Board, and any new director (other than a director
designated by a person who has entered into an agreement with the Company to effect a transaction described in paragraph (a), (c), or (d) of this Section) whose election by the Board or nomination for election by the Company’s stockholders
was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the two-year period or whose election or nomination for election was previously so approved, cease for any
reason to constitute at least a majority of the Board;
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| (c) |
a merger, consolidation, reorganization, or other business combination of the Company with any other entity, other than a merger or consolidation which would result
in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than fifty percent (50%) of
the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; provided, however, that a merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction) in which no person acquires more than twenty-five percent (25%) of the combined voting power of the Company’s then outstanding securities shall not constitute a Change in Control; or
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| (d) |
complete liquidation of the Company or the consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets other than (x)
the sale or disposition of all or substantially all of the assets of the Company to a person or persons who beneficially own, directly or indirectly, at least fifty percent (50%) or more of the combined voting power of the outstanding
voting securities of the Company at the time of the sale or (y) pursuant to a spin-off type transaction, directly or indirectly, of such assets to the stockholders of the Company.
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However, to the extent that Code Section 409A would cause an adverse tax consequence to a Participant using the above definition,
the term “Change in Control” shall have the meaning ascribed to the phrase “Change in the Ownership or Effective Control of a Corporation or in the Ownership of a Substantial Portion of the Assets of a Corporation” under Treasury Department
Regulation 1.409A-3(g)(5), as revised from time to time in subsequent regulations, and in the event that such regulations are withdrawn or such phrase (or a substantially similar phrase) ceases to be defined, as determined by the Committee.
“Change in Control Price” means the price per share of Common Stock paid in any transaction related to a Change in Control of the
Company. “Code” means the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder.
“Committee” means a committee or sub-committee of the Board consisting of two or more members of the Board, none of whom shall be
an officer or other salaried employee of the Company, and each of whom shall qualify in all respects as a “non-employee director” as defined in Rule 16b-3 under the Exchange Act. If no Committee exists, the functions of the Committee will be
exercised by the Board. Notwithstanding the foregoing, with respect to the grant of Awards to non-employee directors, the Committee shall be the Board.
“Common Stock” means the common stock, par value $0.005 per share, of the Company or any other security into which such common
stock shall be changed as contemplated by the adjustment provisions of the Plan.
“Company Group” means Brooklyn ImmunoTherapeutics, Inc. (f/k/a NTN Buzztime, Inc.), a Delaware corporation, any subsidiary of
Brooklyn ImmunoTherapeutics, Inc. and all other entities whose financial statements are required to be consolidated with the financial statements of Brooklyn ImmunoTherapeutics, Inc. pursuant to United States generally accepted accounting
principles, and any other entity determined to be an affiliate of Brooklyn ImmunoTherapeutics, Inc. as determined by the Committee in its sole and absolute discretion. Company Group’s composition may not be the same for different purposes or Awards
under the Plan.
“Covered Individual” means any current or former member of the Committee, any current or former officer or director of the Company,
or, if so determined by the Committee in its sole discretion, any individual designated pursuant to Section 4(c).
“Detrimental Activity” means any of the following: (i) the disclosure to anyone outside the Company, or the use in other than the
Company’s business, without written authorization from the Company, of any confidential information or proprietary information, relating to the business of the Company, acquired by a Participant prior to a termination of the Participant’s
employment or service with the Company; (ii) activity while employed or providing services that is classified by the Company as a basis for a termination for Cause; (iii) the Participant’s Disparagement, or inducement of others to do so, of the
Company or its past or present officers, directors, employees or services; or (iv) any other conduct or act determined by the Committee, in its sole discretion, to be injurious, detrimental or prejudicial to the interests of the Company. For
purposes of subparagraph (i) above, the Chief Executive Officer of the Company shall have authority to provide the Participant with written authorization to engage in the activities contemplated thereby and no other person shall have authority to
provide the Participant with such authorization.
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“Disability” means a “permanent and total disability” within the meaning of Code Section 22(e)(3); provided, however, that if a Participant and the Company have entered into an employment or consulting agreement which defines the term Disability for purposes of such
agreement, Disability shall be defined pursuant to the definition in such agreement with respect to any Award granted to the Participant on or after the effective date of the respective employment or consulting agreement. The Committee shall
determine in its sole and absolute discretion whether a Disability exists for purposes of the Plan.
“Disparagement” means making any comments or statements to the press, the Company’s employees, clients or any other individuals or
entities with whom the Company has a business relationship, which could adversely affect in any manner: (i) the conduct of the business of the Company (including, without limitation, any products or business plans or prospects), or (ii) the
business reputation of the Company or any of its products, or its past or present officers, directors or employees.
“Dividend Equivalents” means an amount equal to the cash dividends paid by the Company upon one share of Common Stock subject to an
Award granted to a Participant under the Plan.
“Effective Date” shall mean the Effective Date as defined in Section 1 of the Plan.
“Eligible Individual” means any employee, officer, director (employee or non-employee director), consultant, or independent
contractor of the Company and any Prospective Employee to whom Awards are granted in connection with an offer of future employment with the Company.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Exercise Price” means the purchase price per share of each share of Common Stock subject to an Award.
“Fair Market Value” means, unless otherwise required by the Code, as of any date, the last sales price reported for the Common
Stock on the day immediately prior to such date (i) as reported by the national securities exchange in the United States on which it is then traded, or (ii) if not traded on any such national securities exchange, as quoted on an automated quotation
system sponsored by the Financial Industry Regulatory Authority, Inc., or if the Common Stock shall not have been reported or quoted on such date, on the first day prior thereto on which the Common Stock was reported or quoted; provided, however, that the Committee may modify the definition of Fair Market Value to reflect any changes in the trading practices of any
exchange or automated system sponsored by the Financial Industry Regulatory Authority, Inc. on which the Common Stock is listed or traded. If the Common Stock is not readily traded on a national securities exchange or any system sponsored by the
Financial Industry Regulatory Authority, Inc., the Fair Market Value shall be determined in good faith by the Committee.
“Grant Date” means, unless otherwise provided by applicable law, the date on which the Committee approves the grant of an Award or
such later date as is specified by the Committee and set forth in the applicable Award Agreement.
“Incentive Stock Option” means an “incentive stock option” within the meaning of Code Section 422.
“Non-Employee Director” means a director of the Company who is not an active employee of the Company.
“Non-Qualified Stock Option” means an Option which is not an Incentive Stock Option.
“Option” means an option to purchase Common Stock granted pursuant to Sections 6 of the Plan.
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“Participant” means any Eligible Individual who holds an Award under the Plan and any of such individual’s successors or permitted
assigns.
“Performance Goals” means the specified performance goals which have been established by the Committee in connection with an Award.
“Performance Period” means the period during which Performance Goals must be achieved in connection with an Award granted under the
Plan.
“Performance Share” means a right to receive a fixed number of shares of Common Stock, or the cash equivalent, which is contingent
on the achievement of certain Performance Goals during a Performance Period.
“Performance Unit” means a right to receive a designated dollar value, or shares of Common Stock of the equivalent value, which is
contingent on the achievement of Performance Goals during a Performance Period.
“Person” shall mean any person, corporation, partnership, limited liability company, joint venture or other entity or any group (as
such term is defined for purposes of Section 13(d) of the Exchange Act), other than a Parent or subsidiary of the Company.
“Plan” means this Brooklyn ImmunoTherapeutics, Inc. Restated 2020 Stock Incentive Plan.
“Prospective Employee” means any individual who has committed to become an employee or independent contractor of the Company within
sixty (60) days from the date an Award is granted to such individual.
“Restricted Stock” means Common Stock subject to certain restrictions, as determined by the Committee, and granted pursuant to
Section 8 hereunder.
“RSU” means a right, granted under Section 9 hereof, to receive Common Stock at the end of a specified period.
“Section 424 Employee” means an employee of the Company or any “subsidiary corporation” or “parent corporation” as such terms are
defined in and in accordance with Code Section 424. The term “Section 424 Employee” also includes employees of a corporation issuing or assuming any Options in a transaction to which Code Section 424(a) applies.
“Stock Appreciation Right” means the right to receive all or some portion of the increase in value of a fixed number of shares of
Common Stock granted pursuant to Section 7 hereunder.
“Transfer” means, as a noun, any direct or indirect, voluntary or involuntary, exchange, sale, bequeath, pledge, mortgage,
hypothecation, encumbrance, distribution, transfer, gift, assignment or other disposition or attempted disposition of, and, as a verb, directly or indirectly, voluntarily or involuntarily, to exchange, sell, bequeath, pledge, mortgage, hypothecate,
encumber, distribute, transfer, give, assign or in any other manner whatsoever dispose or attempt to dispose of.
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