RELATED PARTY TRANSACTIONS 19 We comply with French law regarding approval of transactions 19.2 with related parties.Since January 1, 2015, we have engaged in TRANSACTIONS WITH KEY MANAGEMENT the following transactions with our directors, executive officers PERSONS and holders of more than 5% of our outstanding voting securities and our affiliates, which we refer to as our related parties. 19.2.1 FOUNDER NON-COMPETE UNDERTAKING In March 2017, the Board of Directors authorized our entry into an agreement with Mr. Gilly pursuant to which Mr. Gilly would agree 19.1 not to engage in certain competitive activities for a period of one AGREEMENTS WITH THE COMPANY’S MAJOR year from his departure from the Company in the event that he SHAREHOLDERS terminates his duties with us. For a period of one year from the termination of this undertaking, and unless we elect to waive these 19.1.1 SHAREHOLDERS’ AGREEMENT restrictions, we will be required to make a monthly payment of 40% of Mr. Gilly’s last total net monthly compensation excluding any In connection with our initial public offering on Euronext Paris, bonuses for a period of one year following his termination. Bpifrance Participations, Mr. José Sahel, Mr. Bernard Gil ly, Novartis Pharma AG, Abingworth Bioventures VI L.P., Versant 19.2.2 LEASE AGREEMENT WITH PASSAGE DE Venture Capital IV, L.P., Versant Side Fund IV, L.P., Vitavest S.à.r.l. L’INNOVATION and Fonds Biothérapies Innovantes et Maladies Rare, several of our On January 1, 2015, we entered into a sublease agreement major shareholders, have entered into a shareholders’ agreement for our new premises with Passage de l’Innovation, amended on to organize their relationship as shareholders of our Company. October 1, 2015, January 1, 2016 and April 25, 2017. Pursuant to this last amendment, we will have to pay €533 K excluding taxes, 19.1.2 LICENSE AGREEMENT WITH NOVARTIS on an annual basis, comprised of €318 K for rent, €21 Kfor rental PHARMA AG charges and up to €194 K for other services provided bythe lessor through the end of 2024. In 2017, we paid an amount of €762 K, On February 5, 2013, we entered into a license agreement with comprised of €350 K for rent, €23 K for rentalcharges and Novartis Pharma AG, or Novartis, pursuant to which we have €390 K for other services (including reception desk, maintenance, an exclusive in-license to research, develop, make, use, sell, offer cleaning services, IT management and services, access to shared for sale or otherwise distribute, import and export any products areas such as equipped meeting rooms and a lunch area). The within the scope of the patents and patent applications under two President of the Passage de l’Innovation and one of its shareholders patent families for all ophthalmologic uses. This license agreement was Bernard Gilly, our Chief Executive Officer, until he resigned relates to our GS020 product candidate, which is not currently from this position inPassage de l’Innovation on June 30, 2016. part of our product and development pipeline. As the licensee, Mr. Gilly has retained a shareholding interest in this company. The we may grant and authorize sublicenses within the scope of the amounts the Passage de l’Innovation has charged, and currently license granted by Novartis, as the licensor, provided that we charges us are at fair market value. notify Novartis for prior approval, which shall only be withheld by Novartis for duly justified ethical reasons. In consideration for 19.2.3 EMPLOYMENT ARRANGEMENTS the rights granted by Novartis to us, we paid Novartis an upfront license fee through the issuance of 670,588 (corresponding Bernard Gilly to 268,235 after taking into account the reverse share split on Mr. Gil ly, our Chief Executive Officer, does not have an September 3, 2015) new ordinary shares, corresponding to 15% employment agreement with us. Mr. Gil ly’s compensation is of our share capital. The subscription of such shares was made determined by our Board of Directors upon recommendation of by offsetting the upfront license fee claim against Novartis. In the compensation committee. On February 14, 2013, our Board compliance with IAS38, the rights acquired have been recorded of Directors resolved that we may pay Dr. Gil ly a termination as intangible assets at the fair value of the ordinary shares issued payment equal to the last 12 months of his fixed and variable in payment. The fair value of the 670,588 ordinary shares is €0.41 compensation not capped except in the event of (1) dismissal by per ordinary share. For more information, please see Note 19 us for gross negligence or (2) resignation, other than resignation to our consolidated financial statements as of December 31, for health or family reasons. On March 9, 2017, our Board of 2017 and Section 6.6, “Business Overview Our Second Directors resolved to replace this termination payment by a Product Candidate: GS030 for the Treatment of Photoreceptor termination payment satisfying the requirements under Article Degeneration” of this Registration Document. L.225-42-1 of the French Commercial Code. Consequently, 182– GENSIGHT BIOLOGICS – 2017 Registration Document