Apollo Endosurgery, Inc. (Form: 8-K, Received: 11/17/2017 07:13:12)

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): November 13, 2017

Apollo Endosurgery, Inc.

(Exact name of registrant as specified in its charter)



Delaware	001-35706	16-1630142
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)



1120 S. Capital of Texas Highway Building 1, Suite #300 Austin, Texas 78746 (Address of principal executive offices) (Zip Code)

(512) 279-5100

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:



		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2):

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. 

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(b) Resignation of Executive Officer.

On November 13, 2017 , Dennis McWilliams, 46, President and Chief Commercial Officer resigned from his position with Apollo Endosurgery, Inc. (“ Apollo ”). On November 13, 2017 and November 15, 2017 , and in connection with Mr. McWilliams resignation, we have entered into a separation, severance and general release agreement and transition services agreement, respectively. Apollo does not anticipate replacing Mr. McWilliams.

Separation, Severance and General Release Agreement

In exchange for Mr. McWilliams execution of a general release and non-compete in favor of the Company, Mr. McWilliams will receive the following benefits:


•	Cash severance of six months of Mr. McWilliams annual base salary.


•	Continued health care coverage and COBRA for up to eight months consistent with what the Company currently provides, so long as Mr. McWilliams timely elects such continued coverage.


•	Continued vesting of all outstanding equity awards through the end of Mr. McWilliams transition services agreement.

Transition Services Agreement

During the period following his resignation until January 31, 2018 Mr. McWilliams will provide certain transition services of his duties and responsibilities as may be needed and in return, Mr. McWilliams will receive the following benefits:


•	Cash fee of $72,917 and reimbursement of reasonable business-related expenses, if any.

The foregoing descriptions of the separation, severance and general release agreement and transition services agreement are qualified in their entirety by reference to the full text of the agreements, copies of which are filed herewith as Exhibits 10.1 and 10.2, respectively and are incorporated by reference herein.

(d) Appointment of Director.

On November 13, 2017 , David C. Pacitti was appointed to the Board of Directors of the Company (the “ Board ”). Mr. Pacitti will serve as a Class I director starting on December 8, 2017, and his term will expire at the annual meeting of stockholders in 2018 and until his successor has been duly elected and qualified, or until his earlier death, resignation or removal. Mr. Pacitti was also appointed to serve as a member of the Compensation Committee of the Board. The Board has affirmatively determined that Mr. Pacitti is an independent director pursuant to Nasdaq’s governance listing standards and those rules and regulations issued pursuant to the Securities Exchange Act of 1934, as amended.

There are no arrangements or understandings between Mr. Pacitti and any other persons pursuant to which he was selected as a director, and there are no related person transactions (within the meaning of Item 404(a) of Regulation S-K or 5.02(d) of Form 8-K) between Mr. Pacitti and the Company required to be disclosed herein.

In connection with his appointment to the Board and Compensation Committee of the Board, it is anticipated Mr. Pacitti will be granted pursuant to Apollo’s 2017 Equity Incentive Plan an initial stock option and restricted stock award to acquire Apollo common stock, with an aggregate value of $55,000, each vesting in full on December 8, 2018. Both the stock option and restricted stock award will have an exercise price equal to the closing price of Apollo common stock as reported on the NASDAQ Global Market on December 8, 2017. The 2017 Equity Incentive Plan and related forms of stock option agreement and restricted stock award are filed as Exhibit 10.1, 10.2 and 10.3, respectively, to Apollo’s Registration Statement on Form 8-K filed with the Securities and Exchange Commission on June 13, 2017.

In connection with his appointment, Apollo plans to enter into an indemnity agreement with Mr. Pacitti in connection with his services as a member of the Board. The form of indemnity agreement is filed as Exhibit 10.1 to the Apollo’s Current Report on Form 8-K filed with the SEC on January 3, 2017, and is incorporated by reference herein.

Item 9.01 Financial Statements and Exhibits.



Number		Description
10.1		Separation, Severance and General Release Agreement, dated November 13, 2017, by and between Apollo Endosurgery, Inc. and Dennis McWilliams.
10.2		Transition Services Agreement, dated November 15, 2017, by and between Apollo Endosurgery, Inc. and Dennis McWilliams.

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.



		APOLLO ENDOSURGERY, INC.

Dated:	November 17, 2017
		By:	/s/ Todd Newton
		Name:	Todd Newton
		Title:	Chief Executive Officer

Exhibit 10.1

Date Given to Employee: November 13, 2017

SEPARATION, SEVERANCE AND GENERAL RELEASE AGREEMENT

This Separation, Severance and General Release Agreement ("the “ Agreement ") is between Dennis McWilliams (“ Employee ”) and Apollo Endosurgery, Inc. (the “ Company ”).

WHEREAS:


a)	Employee has been employed by Company pursuant to an employment agreement, dated June 1, 2006, as amended (the “ Employment Agreement ”);


b)	Employee has voluntarily resigned, effective November 13, 2017 (“ Separation Date ”); and


c)	The parties desire to settle all claims and issues between Employee and Company to date, including, but not limited to, Employee’s employment with Company or the termination of that employment.

THEREFORE :

For mutual consideration the adequacy and sufficiency of which is acknowledged by the parties, the parties agree as follows:

1. Severance Benefits.

The Company will pay to Employee a total of $175,000, less applicable withholding. Such amount represents six (6) months’ worth of Employee’s base salary. The payment will be made in a lump sum, in accordance with the Company’s normal payroll procedures, within 7 business days following the Effective Date provided that Employee has not revoked this Agreement. In the event that Employee breaches this Agreement or the Non-Competition Agreement (as defined later), the Company may, at its sole election, choose to rescind this Agreement in which case Employee must also pay back to the Company any severance benefit Employee has received under this Agreement. Any existing equity awards previously granted to Employee shall continue to vest until January 15, 2018.

2. Health Insurance; COBRA Rights.

Current healthcare benefits will continue through the end of November 2017. As required by law, Employee will be offered the opportunity to elect continuation of coverage under the group medical plan(s) of the Company. Employee will be provided with the appropriate notices and election forms for this purpose. The existence and duration of Employee’s continuation rights and/or the continuation rights of any of Employee’s eligible dependents will be determined in accordance with the law.

If Employee timely elects group health insurance coverage under COBRA and does not revoke this Agreement, the Company will pay Employee’s monthly COBRA premiums (including the cost of coverage for Employee’s dependents if enrolled) through the earliest of the following (i) July 31, 2018; (ii) the date that Employee becomes eligible for group health insurance coverage through a new employer; or (iii) the date that Employee is no longer eligible for COBRA coverage. Employee must provide prompt written notice to the Company if Employee becomes eligible for group health insurance coverage

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through a new employer before July 31, 2018. The payments under this section will begin after the Effective Date. No Other Entitlements.

As of the Separation Date, Employee acknowledges that Employee will no longer be entitled to any other benefits, payments, or contributions from the Company other than those specifically provided for in this Agreement.

3. Earned Compensation.

Employee specifically acknowledges that, as of the date of Employee’s execution of this Agreement, Employee has received all wages, employment compensation, PTO, and reimbursements to which Employee is entitled through and including the Separation Date.

4. Non-Admission.

The Parties understand and agree that this Agreement does not represent any admission of liability or misconduct by any person or entity for any purpose.

5. Release.


(a)	General Release.

Employee unconditionally, irrevocably and absolutely releases and discharges Company, and any parent or subsidiary corporations, divisions or affiliated corporations, partnerships or other affiliated entities of the foregoing, past and present, as well as their past and present employees, officers, directors, shareholders, agents, successors and assigns (collectively, “ Released Parties ”), from all claims related in any way to the transactions or occurrences between them to date, to the fullest extent permitted by law, including, but not limited to, Employee’s employment with Company, Employee’s separation from Company, and all other losses, liabilities, claims, charges, demands and causes of action, known or unknown, suspected or unsuspected, arising directly or indirectly out of or in any way connected with Employee’s employment with Company. This release is intended to have the broadest possible application and includes, but is not limited to, any tort, contract, common law, constitutional or other statutory claims, including, as applicable, but not limited to alleged violations of Title VII of the Civil Rights Act, the Family and Medical Leave Act, the Americans with Disabilities Act, the Equal Pay Act, the Genetic Information Nondiscrimination Act of 2008, the Lily Ledbetter Fair Pay Restoration Act of 2009, the Employee Retirement Income Security Act, Sections 1981-1983 of Title 42 of the United States Code, the Worker Adjustment and Retraining Notification Act, the Texas Labor Code, as well as any claims under local statutes and ordinances that may be legally waived and released, and/or any other federal, state, or local law (statutory, regulatory or otherwise) that may be legally waived and released, and claims for promissory estoppel or detrimental reliance, claims for wages, bonuses, incentive compensation and severance allowances or entitlements, wrongful discharge, all claims for fraud, slander, libel, defamation, disparagement, intentional infliction of emotional distress, invasion of privacy, nonphysical injury, personal injury or sickness or any other harm, negligence, breach of contract, compensatory or punitive damages, or any other claim for damages or injury of any kind whatsoever, and all claims for monetary recovery, including, without limitation, attorneys' fees, experts'

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fees, medical fees or expenses, costs and disbursements. Employee expressly waives any claims he may have with regard to his Employment Agreement, including without limitation any claim of severance.


(b)	Waiver of Recovery.

Employee expressly waives Employee’s right to recovery of any type, including damages or reinstatement, in any administrative or court action, whether local, state or federal, and whether brought by Employee or on Employee’s behalf, related in any way to the matters released herein.


(c)	Nonwaivable Claims.

The parties acknowledge that this general release is not intended to bar any claims that, by statute, may not be waived, such as Employee’s right to file a charge with the National Labor Relations Board or Equal Employment Opportunity Commission and other similar government agencies. However, Employee hereby disclaims and waives any right to share or participate in any monetary award resulting from the prosecution of such charge or investigation. The parties also acknowledge that this general release is not intended to bar claims for statutory indemnity, workers’ compensation benefits or unemployment insurance benefits, as applicable. However, the parties agree that McWilliams’s expert consulting or other professional activities taken on outside of his employment with Company would not be covered by any indemnity or insurance agreement between McWilliams and the Company.


(d)	Discovery of Additional Facts.

Employee acknowledges that Employee may discover facts or law different from, or in addition to, the facts or law that Employee knows or believes to be true with respect to the claims released in this Agreement and agrees, nonetheless, that this Agreement and the release contained in it shall be and remain effective in all respects notwithstanding such different or additional facts or the discovery of them.


(e)	Complete Release.

Employee declares and represents that Employee intends this Agreement to be complete and not subject to any claim of mistake, and that the release herein expresses a full and complete release and Employee intends the release herein to be final and complete. Employee executes this release with the full knowledge that this release covers all possible claims against the Released Parties, to the fullest extent permitted by law.

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6. ADEA Provisions.

Employee acknowledges that Employee is waiving and releasing any rights Employee may have under the Age Discrimination in Employment Act of 1967 (“ ADEA ”) and that this waiver and release is knowing and voluntary. The Parties agree that this waiver and release does not apply to any rights or claims that may arise under ADEA after the Effective Date of this Agreement. Employee acknowledges that the consideration given for this waiver and release agreement is in addition to anything of value to which Employee is already entitled. Employee further acknowledges that Employee has been advised by this writing that (a) Employee should consult with an attorney before executing this Agreement; (b) Employee has at least 21 days to consider this Agreement; (c) Employee has at least seven days following the execution of this Agreement to revoke the Agreement; and (d) this Agreement shall not be effective until the revocation period has expired and no revocation has been made. Revocation can be made by delivering a written notice of revocation to Brian Szymczak by mail, fax, or email at brian.szymczak@apolloendo.com, at the Austin office location, such that Mr. Szymczak receives such revocation before midnight, CST on the seventh day after Employee’s signature below. Assuming that no revocation is made, the Effective Date of this Agreement is the eighth day after Employee’s signature below (“ Effective Date ”). Nothing in this Agreement prevents or precludes Employee from challenging or seeking a determination in good faith of the validity of this waiver under the ADEA, nor does it impose any condition precedent, penalties or costs for doing so, unless specifically authorized by federal law.

7. Representations and Acknowledgements.

Employee represents to each of the Releasees that at no time before Employee’s execution of this Agreement has Employee filed or caused or permitted the filing of any charge, claim or action of any kind, nature and character whatsoever, which Employee may now have or has ever had against any of the Releasees that is based in whole or in part on any matter released above.

8. Non-Disparagement.

Employee agrees that Employee will not disparage the Company or any of the Releasees, or any of their respective officers, directors, employees, products or services.

9. No Future Employment with Company.

Employee represents that Employee does not desire re-employment with Company, and hereby expressly waives any and all rights, if any, that Employee may have to employment or consideration for employment with Company.

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10. Confidentiality and Return of Company Property.

Employee understands and agrees that as a condition of receiving the severance benefits, all Company property must be returned to Company within 10 days of the Separation Date or upon such other date as directed by the Company in writing. By signing this Agreement, Employee represents and warrants that Employee will return all Company property, data and information belonging to Company, including all technical data, marketing materials, customer lists, and information of whatever nature, as well as any other materials, keys, passcodes, access cards, credit cards, computers, documents or information, including but not limited to confidential information in Employee’s possession or control. Further, Employee represents, warrants, and agrees that Employee shall retain no copies thereof, including electronic copies and will not disclose such information to any third party. Employee agrees Employee will not use or disclose to others any confidential or proprietary information of Company or the Released Parties in accordance with Employee’s obligations under the Non-Competition Agreement.

11. Non-Competition.

The Parties acknowledge the Covenant of Non-Competition existing in the Invention, Confidential Information and Non-Competition Agreement entered between the Company and Employee September 1, 2006 (the “Invention Agreement”). The Parties agree to waive Employee’s specific non-competition obligations under the Invention Agreement after July 31, 2018. With respect to the non-competition covenant in Section 7 of the Invention Agreement the parties acknowledge and agree that the Employee is required to request a formal waiver from the Company releasing him prior to July 31, 2018 from his non-compete obligations in the Innovations Agreement.

12. Arbitration

Any disputes arising from this Agreement shall be resolved through final, binding, and confidential arbitration in Austin, Texas before an arbitrator mutually selected by the parties. In the event the parties cannot agree on an arbitrator, then each party shall select an arbitrator, both of whom shall select a third arbitrator and the matter will be submitted to a three-arbitrator panel. Cost shall be equally split by the parties during the course of the arbitration, but after hearing all evidence, the arbitrator may alter that percent of split of cost between the parties as part of the arbitrator’s final decision.

13. Third Party Beneficiaries.

As third-party beneficiaries of this Agreement, the Releasees (or any of them) will be entitled to enforce this Agreement in accordance with its terms in respect of the rights granted to such Releasees. There are no other third-party beneficiaries to this Agreement.

14. No Precedential Effect.

By entering into this Agreement, it is not the intention of the Company to establish any policy, procedure, course of dealing or plan of general application irrespective of any similarity in facts or circumstances involving such other employee, on the one hand, and Employee, on the other hand.

15. Entire Agreement.

This Agreement contains the entire agreement between the parties with respect to the subject matter set forth in this Agreement, and supersedes and preempts all other agreements and obligations

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between the parties. The terms and conditions of this Agreement are contractual and not a mere recital. No part of this Agreement may be changed except in writing executed by the parties. The parties acknowledge and agree that Employee has certain continuing obligations as contained in the Invention, Confidential Information and Non-Competition Agreement, dated September 1, 2006 (“ Non-Competition Agreement ”). The parties acknowledge and agree that this Agreement does not affect any of Employee’s obligations and responsibilities in the Non-Competition Agreement.

16. Choice of Law.

This Agreement will be interpreted in accordance with the laws of the State of Texas, without reference to its conflicts of laws principles.

17. Headings.

Any titles, captions and headings contained in this Agreement are inserted for convenience of reference only and are not intended to be a part of or to affect in any way the meaning or interpretation of this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the date of the last signature affixed below.

READ CAREFULLY BEFORE SIGNING

I have read this Agreement and have had adequate opportunity for review prior to my signing of this Agreement. I understand that by executing this Agreement I will relinquish any right or demand I may have against the Releasees.



		DENNIS MCWILLIAMS


Dated:	November 15, 2017	/s/ Dennis McWilliams


		APOLLO ENDOSURGERY, INC.


Dated:	November 15, 2017	Mary League
		Name: Mary League
		Title: Vice President of Human Resources

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Exhibit 10.2

APOLLO ENDOSURGERY, INC.

TRANSITION SERVICES AGREEMENT

THIS TRANSITION SERVICES AGREEMENT (the “Agreement”) is effective as of November 15, 2017 (the “Effective Date”) by and between Dennis McWilliams, an individual, with a business address of 4608 Via Media, Austin, Texas 78746 (the “Consultant”) and Apollo Endosurgery, Inc., a Delaware corporation (the “Company”) to be effective as provided herein.

WHEREAS, the Company is developing products and technologies in the field of endoscopic surgery and obesity treatments;

WHEREAS, the Consultant was formerly employed with Company and has expertise related certain business matters of the Company;

WHEREAS, Company desires to retain the Consultant to perform and do certain work for the Company in furtherance of the transition of certain projects and matters following the Consultant’s departure from the Company, on the terms and conditions of this Agreement; and

WHEREAS, the Consultant is desirous of performing such work for the Company, on the terms and conditions contained herein:

In consideration of the mutual promises, covenants and obligations contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1. Engagement . The Company hereby engages the Consultant and the Consultant hereby accepts such engagement, on the terms and conditions in this Agreement

2. Field . The “Field” of this Agreement shall be for medical devices for bariatric applications and/or obesity treatment, endoscopic fixation devices and devices or technology for the treatment of gastroesophageal reflux disease.

3. Services. The Consultant shall provide the following “Services”:

(a) The Consultant shall transition projects and duties formerly managed or performed by consultant to Company employees and perform such other transition services established from time in time in consultation with the Company.

(b) The Consultant shall also provide general advisory services to the Company as the Company may reasonably request from time to time (the services described above are collectively called the “Services”).

(c) Notwithstanding any of the foregoing, the Consultant shall not have any authority to bind the Company or otherwise commit the Company contractually and shall not have management responsibilities of any Company employees.

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4. Term and Termination .

(a) The term of this Agreement shall begin on the Effective Date and shall expire on January 31, 2018 unless extendable by mutual written agreement of the parties. Notwithstanding the foregoing or any other provisions in this Agreement to the contrary, Sections 7, 8, 9, and 10 below shall survive the termination of this Agreement and the Consultant’s engagement hereunder.

5. Compensation . As compensation for the Services rendered under this Agreement, the Consultant shall be as follows:

(a) Fee : The Company shall pay the Consultant a total fee for the period of this agreement in the amount of $72,917.00, to be paid in installments once a month (i.e., beginning December 15, 2017 or January 1, 2018) during the term of the agreement.

(b) Expenses . Reimbursement from the Company for reasonable and necessary out-of-pocket travel and other expenses incurred by the Consultant in rendering services under this Agreement, subject to providing documentation of the same to the Company. Company agrees to pay for all additional information requirements, reports, etc. needed for Consultant to perform his duties, however all such expenses, including travel shall be agreed upon by the Company in writing in advance.

(c) Benefits . During the term of this Agreement, the Consultant shall not be entitled to receive any employee or fringe benefits from the Company under this Agreement. The Parties acknowledge that Consultant may receive benefits from the Company as part of his prior employment with Company or under the terms of other agreements entered between Consultant and Company.

(d) Other . The compensation set forth in this Section 5 will be the sole compensation payable to the Consultant for the Services and no additional compensation or fee will be payable by the Company to the Consultant by reason of any benefit gained by the Company directly or indirectly through the Consultant’s consulting efforts under this Agreement, nor shall the Company be liable in any way for any additional compensation or fee for Services unless the Company expressly agrees thereto in writing.

6. Independent Contractor Status . The Company and the Consultant agree that the Consultant is an independent contractor under this Agreement and shall in no way be considered to be an agent or employee of the Company and, accordingly, the Consultant shall not be entitled to any benefits, coverages, or privileges made available to employees of the Company. The Consultant shall only consult and render advice and shall not undertake to commit the Company to any course of action in relation to third persons, except as requested by the Company. During the term of his engagement, the Consultant shall be liable for any and all worker’s compensation payments and federal, state, and local employment, sales, use, excise, and other taxes arising out

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of his performance of this Agreement and shall furnish evidence of such compliance or an applicable waiver of requirements to the Company upon request.

7. Confidentiality . As used in this Agreement, the term “Confidential Information” means all confidential and proprietary information related to the Company that is not generally known in the trade, science or industry in which the Company is engaged. All such information shall be Confidential Information whether furnished to the Consultant by the Company or its affiliates or customers or whether made, conceived, developed, prepared, or acquired by the Consultant alone or in conjunction with others during the Term of this Agreement or at any other point during which the Consultant rendered services to the Company. Confidential Information shall not include information:

(a) which is or becomes publicly published in any written documents or otherwise become a part of the public domain; or

(b) which the Consultant can establish was already in his possession and not the subject of any secrecy obligation at the time the Consultant encountered such information in the course of, or incident to, his engagement by the Company.

The Consultant recognizes and acknowledges that during the term of his retention he will have access to Confidential Information and that such information constitutes a valuable asset unique to the Company and its affiliates. The Consultant recognizes and acknowledges that the Company and its affiliates are entitled to prevent the disclosure of Confidential Information and that any such disclosure will result in irreparable injury and damage to the Company or its affiliates and constitute a breach of this Agreement. The Consultant agrees to hold in strict confidence and not to use or disclose any Confidential Information for or to any person, firm, corporation, association, or entity either during the term of this Agreement or thereafter, except as authorized by the Company or as is necessary for the performance of duties under this Agreement but only after having received written consent from the Company which consent shall be limited to the specific Confidential Information described therein. The Consultant shall take such protective measures as are reasonably necessary to preserve the confidentiality of such Confidential Information and shall exercise his best efforts to prevent any unauthorized parties from gaining access thereto.

The Consultant understands and agrees that any Confidential Information is and shall remain the sole and exclusive property of the Company and is subject to the obligations of confidentiality and non-use set forth herein. The Consultant agrees that ownership of all originals and copies of any Confidential Information vests in the Company from the time of its creation, together with all copyright and other intangible rights in works embodied therein. The Consultant shall promptly report the making of all Confidential Information to the Company and the Consultant agrees to execute any and all documents necessary to vest or protect the Company’s interest in said Confidential Information, including but not limited to the execution of written assignments thereof to the Company. The Consultant agrees to assist the Company in making and prosecuting any and all patent, trademark, or copyright applications relating to any Confidential Information. The Consultant agrees that any Confidential Information shall be promptly delivered to the Company upon its request or upon the termination of this Agreement for any reason, together with any and all copies or reproduction thereof.

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The Consultant’s Services shall preclude the Consultant from performing the same or similar Services on behalf of any Conflicting Organization (as that term is defined in Section 8. The Consultant hereby acknowledges that he does not currently perform the same or similar Services for any Conflicting Organization and shall deliver to the Company’s management at least once each quarter during the term of this Agreement a description of any other services he is performing or work he is doing and the entity or person for which the Consultant is performing such Services that are potentially in conflict with the Company’s activities, for the Board’s assessment of the same.

Nothing contained in this Agreement shall be construed as a grant of any right or license or an offer to grant any rights or licenses with respect to such Confidential Information, or any portion thereof, except as expressly set forth herein. Upon the termination of the Consultant’s engagement under this Agreement for any reason whatsoever, the Consultant will promptly deliver to the Company all data, documents and other information pertaining to Confidential Information. The Consultant shall not take any data, documents, or other information or any reproduction or excerpt thereof which contains or pertains to any Confidential Information.

8. Covenants Not to Compete .

(a) The Consultant agrees that, during his engagement with the Company under this Agreement he will not take any actions or otherwise engage, directly or indirectly, either on his own or with any other entity as an employee, employer or consultant, in any business or activity that sells, markets or develops products in the Field (a “Conflicting Organization”).

(b) This Section 8 shall not prohibit the Consultant from purchasing or holding an aggregate equity interest of up to two percent (2%) in any business engaged in direct or indirect competition with the Company and its affiliates.

(c) The Consultant further agrees that during the term of this Agreement he will not, either by himself or acting in concert with others, employ or solicit or attempt to employ or solicit for any employment competitive with the Company any of the Company’s employees or consultants who work in any area in which the Consultant has been significantly engaged on behalf of the Company. The Consultant will not, either directly or indirectly or by acting in concert with others, seek to induce or influence any consultant or employee to leave the Company’s service or employment.

9. Inventions . Consultant agrees to transfer and assign and hereby does transfer and assign to the Company the entire right, title and interest for the entire world in and to any Inventions made or conceived or reduced to practice by Consultant (a) in the course of accomplishing the Services, or (b) with the use of materials or facilities of the Company. Consultant agrees that Consultant will sign, execute and acknowledge, or cause to be signed, executed and acknowledged, at the expense of the Company, any and all documents, and will perform any and all acts, as may be necessary, useful or convenient for the purpose of securing to the Company or its nominee patent, trademark or copyright protection throughout the world upon all such Inventions. Consultant represents that the Consultant is not bound by any other agreement that would otherwise encumber the Consultant’s intellectual property, other than those disclosed in Exhibit A.

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10. Miscellaneous .

(a) Remedies Upon Breach by the Consultant . In the event that this Agreement is terminated by the Company for cause, the Consultant shall not be entitled to be paid any amounts which have accrued hereunder and have not been paid. In addition, the Company shall be entitled, if it so elects, to institute and prosecute proceedings in any court of competent jurisdiction, either in law or in equity, to enjoin the Consultant from violating any of the terms of this Agreement, to enforce the specific performance by the Consultant of any of the terms of this Agreement, and to obtain damages, or any of them, but nothing contained in this Agreement shall be construed to prevent such remedy or combination of remedies as the Company may elect to invoke. The failure of the Company to promptly institute legal action upon any breach of this Agreement shall not constitute a waiver of that or any other breach hereof. The Consultant acknowledges and recognizes that the enforcement of the provisions set forth in Sections 6, 7, 8 and 9 above by the Company will not interfere with the Consultant’s ability to pursue a proper livelihood. The Consultant recognizes and agrees that the enforcement of this Agreement is necessary to ensure the preservation and continuity of the business and goodwill of the Company and its affiliates.

(b) Limitations on Warranty or Liability . Consultant’s sole warranty shall be that the Services shall be performed in a professional and workmanlike manner and that none of such Services shall be inconsistent with any obligation the Consultant may have to others. Except with respect to Sections 6, 7, 8, and 9 above, in no event shall the Consultant be liable for any damages whatsoever, including without limitation, any loss of profits, loss of business, loss of use of data, interruption of business, or for direct, indict, special, incidental or consequential damages of any kind, even if the Company has been advised of the possibility of such damages and notwithstanding any failure of essential purpose of any limited remedy.

(c) Other Obligations . The Consultant represents and warrants that he has not, as of the execution of this Agreement, assumed any obligations inconsistent with those contained herein.

(d) Notices . All notices, requests, demands, payments, and other communications made pursuant to this Agreement shall be in writing and shall be deemed properly given if hand delivered, if sent by mail, electronic mail, or overnight courier service, or if transmitted by telecopy or similar service to the parties hereto either at the address set forth below for such person or at such other address as such person may from time to time specify by written notice pursuant to this Section 10(d). Any such notice shall be deemed to have been delivered on the date of delivery if hand delivered, upon confirmation if transmitted by telecopy or similar service, or as of three days after depositing such notice with the United States postal service if sent by mail or if delivered to an overnight courier service and shall be delivered with postage prepaid, return receipt requested, and properly addressed as follows:

If to the Company:

Apollo Endosurgery, Inc.

1120 S. Capital of TX Hwy

Bldg. 1, Suite 300

Austin, Texas 78746

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Attn: Legal Dept.

If to the Consultant:

Dennis McWilliams

4608 Via Media

Austin, Texas 78746

(e) Binding Agreement . This Agreement and the rights and obligations hereunder shall be binding upon and inure to the benefit of the Company and the Consultant and their respective heirs, personal representatives, and successors and assigns. The Company shall have the right to assign this Agreement to any affiliate or to its successors or assigns. The terms “successors” and “assigns” shall include any person, corporation, partnership, or other entity that buys all or substantially all of the Company’s assets or all of its stock or with which the Company merges or consolidates. The rights, duties, or benefits of the Consultant under this Agreement are personal and no such right, duty, or benefit may be assigned by the Consultant to any other person. The parties to this Agreement acknowledge and agree that the Company’s affiliates are third-party beneficiaries of the covenants and agreements of the Consultant set forth in Sections 6, 7, 8 and 9 above. The Consultant shall not designate any other person to perform services on his behalf hereunder.

(f) Entire Agreement . This Agreement constitutes the entire agreement between the Company and the Consultant with respect to the transactions contemplated herein. This Agreement may be modified or amended only by an instrument in writing and signed by all the parties hereto. Any waiver of the terms and conditions of this Agreement must be in writing signed by all the parties hereto and any such waiver shall not be construed as a waiver of any other terms and conditions of this Agreement.

(g) Severability . If any provision of this Agreement shall be found to be illegal, invalid, or unenforceable under present or future laws, such provision shall be fully severable and the remaining provisions shall remain in full force and effect. Any provision of this Agreement held illegal, invalid, or unenforceable shall remain in full force and effect to the extent not so held. In lieu of the provision held illegal, invalid, or unenforceable, there shall be automatically added as part of this Agreement a provision as similar in its terms to such invalid provision as may be possible and may be legal, valid, and enforceable.

(h) Counterparts . This Agreement may be executed in several counterparts and each such counterpart shall be deemed an original copy of this Agreement when so executed and such counterparts shall, when taken together, constitute and be one and the same instrument.

(i) Further Assurances . Each party hereby agrees to perform any further acts and to execute and deliver any documents which may be reasonably necessary to carry out the provisions of this Agreement.

(j) Captions . The captions and headings in this Agreement are made for purposes of convenience and general reference only and shall not be construed to define, limit, or otherwise affect any of the terms or provisions of this Agreement.

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(k) Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of Texas and applied without giving effect to any conflicts of laws principles. Any matters litigated by, among, or between any of the parties and that involve matters under this Agreement shall be brought only in a court of competent jurisdiction in Travis County, Texas.

(l) Affiliate . An “affiliate” of any party hereto shall mean any person controlling, controlled by, or under common control with such party.

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IN WITNESS WHEREOF, the parties caused this Agreement to be executed and delivered effective as of the Effective Date.



		COMPANY:

		APOLLO ENDOSURGERY, INC.


		/s/ Mary League
		By: Mary League


		CONSULTANT:

		Dennis McWilliams


		/s/ Dennis McWilliams

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Exhibit A

Dear Apollo Endosurgery, Inc.:

The following is a complete list of all agreements that I am currently a party to or intend to be a party that restrict my ability to grant intellectual property rights under this Agreement.



x	No Agreements

	See below














	Additional sheets attached

			/s/ Dennis McWilliams

		Date:	November 15, 2017

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