La Jolla Bioengineering Institute

“Board member Michael Nicolaou and LJBI have a business relationship. LJBI provides accounting services for Nicopharm which is owned by Michael Nicolaou. On January 18, 2010, LJBI hired Michael Nicolaou on a part-time basis as CFO. He has been compensated in the amount of $9,723 for the fiscal year end June 30, 2013. He does not currently receive any other employee benefits.”

“The Executive Officer reviews the return and submits the return to Patti Hodson, CPA and the Board Members to review. The Executive Officer consults with the CPA and Board Members and then signs the return.”

“All Board Members and employees review and sign the conflict of interest policy annually. All signed conflict of interest policies are kept on file until the following year when the renewal is required. The renewal is done in January or February and all new employees and new Board Members will sign a conflict of interest policy on the day of hire.”

“Policy Regarding Determination of Compensation for President and CEO:The LJBI Board of Directors (Board) functions as the Compensation Committee for purposes of determining executive salary comparability and ensuring all of LJBI's compensation practices are carried out in a responsible manner that are also compliant with state and federal regulations. The Board has overall responsibility for evaluating the performance and compensation of the President and CEO (Executive). The Board has responsibility to provide the Executive with constructive feedback regarding his performance. The Board may use the Executive's performance evaluation as a mechanism to measure LJBI's progress towards its strategic goals. 1. The Executive's job description will be reviewed annually. Changes to essential functions or responsibilities will be made as appropriate. The Chair of the Board will be responsible for ensuring the job description remains current.2. A set of annual goals and objectives will be developed by the Executive for the Board's approval and documented annually. These may be updated or adjusted throughout the year if necessary, as agreed to by the Executive and the Board.3. The Executive is expected to complete a self-assessment survey and report on his own assessment of progress towards goals. This process is also intended to allow the Executive the opportunity to indicate any obstacles impeding progress or specific resources necessary to ensure the Executive's success.4. The self-assessment will be shared and discussed with the Board and such discussion will inform the development of an annual verbal and written performance evaluation for the Executive.5. The Chair of the Board will be responsible for developing a written performance evaluation which will be delivered verbally to the Executive and documented in writing.6. Any changes in salary for the Executive will be determined using the following process:a) The LJBI Board of Directors shall also serve as the Compensation Committee.b) Prior to any change in salary, the Board shall obtain third party benchmark data for positions comparable to that of the Executive to ensure comparability of total compensation.c) After a review of comparability data, the Chair of the Board will make a recommendation of an appropriate salary, bonus and any other fringe benefits or perquisites, subject to approval by the Board.d) The Board will consider any changes to the Executive's salary based on the Executive's performance against expectations and goals, as well as the reasonableness of the recommendation based on the comparability data it has reviewed.e) The Board, by vote, will approve or disapprove the recommended change to Executive's salary. If approved:f) The Chair of the Board or his/her designee will delegate to a LJBI staff member implementation of the resolved compensation and/or benefit changes.”

“LJBI makes its governing documents, conflict of interest policy and financial statements available to the public upon request.”

“Transfer of equipment = -$78785”