Exibit 10.56
EXECUTIVE EMPLOYMENT AGREEMENT
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, PH.D.
This EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement") is entered into by
and between ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Ph.D. (hereinafter "Executive") and VaxGen, Inc.
(hereinafter "VaxGen" or the "Company"), as of the date that it has been signed
by both parties (the "Effective Date"). In consideration of the mutual promises
made herein, VaxGen and Executive agree as follows:
1. EMPLOYMENT BY THE COMPANY. VaxGen hereby employs Executive, and
Executive hereby accepts employment with VaxGen upon the terms and conditions
set forth in this Agreement, as of the tenth business day after the Effective
Date (the "Hire Date"). On the Hire Date, Executive will be employed as the
Company's Senior Vice President, Research and Development and Chief Scientific
Officer ("Senior VP of R&D and CSO").
2. WORK RESPONSIBILITIES. As Senior VP of R&D and CSO, Executive shall
perform the functions and responsibilities provided for that position in the
Company's by-laws and articles of incorporation, customarily associated with
that position, and as may be assigned from time to time by the Company's Chief
Executive Officer ("CEO"), including, but not limited to, leading and managing
the Research and Development function of the Company. VaxGen may assign
additional or different duties to Executive, provided that such duties are
consistent with Executive's senior management position. As Senior VP of R&D and
CSO, Executive will report to the CEO. Executive shall devote the whole of her
professional time, attention and energies to the performance of her work
responsibilities (except for vacation periods and reasonable periods of illness
or other incapacity permitted by the Company's general employment policies, or
as otherwise permitted by this Agreement). Executive will be located in the
Company's facilities in the San Francisco Bay Area.
3. COMPENSATION AND BENEFITS.
(a) Base Salary. VaxGen will pay Executive an initial base salary at
the annualized rate of two hundred sixty thousand dollars ($260,000), less
standard payroll deductions and withholdings and payable in accordance with the
Company's regular payroll schedule. Such compensation is subject to upward
adjustment (except in the event that the Company's Board of Directors determines
that a reduction in senior executive salaries is in the best interest of the
Company) from time to time in the Company's discretion. Executive's base salary
shall be reviewed on the next compensation review date for all executive
employees, and annually thereafter.
(b) Signing Bonus. Executive shall be entitled to a one-time signing
bonus of Fifty Thousand Dollars ($50,000), to be paid in a single lump sum
(subject to standard payroll deductions and withholdings) within ten (10)
business days after the Effective Date (the "Signing Bonus"). If Executive's
employment ends at her request during her first year of employment, except where
such cessation of employment results from a material breach of this Agreement by
VaxGen, she agrees to repay a portion of the Signing Bonus to the Company on or
before her termination date, prorated based on the length of her employment
(e.g., for every month
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Executive is employed, 1/12th of the Signing Bonus will be forgiven, and any
unforgiven amount must be repaid to the Company).
(c) Bonus Potential. Executive is eligible to receive an annual
bonus in the targeted range of up to thirty percent (30%) of her annual base
salary. Such bonuses, if any, are awarded at the sole discretion of the
Company's Board of Directors (the "Board") based on its reasonable assessment of
Executive's performance as measured by the performance objectives agreed upon
and memorialized in writing between Executive and the CEO, as well as Company
performance (in recognition of the fact that all executive bonuses may be
affected by Company performance). No bonuses are earned until approved by the
Compensation Committee of the Board and confirmed in writing. The Company shall
have the sole discretion to change or eliminate the annual bonus program at any
time, and to determine the amount of bonus earned by Executive, if any.
(d) Stock Option Grant. Subject to Board approval, within three (3)
business days following the Hire Date, the Company will grant to Executive a
non-qualified Stock Option to purchase one hundred twenty thousand (120,000)
shares of the Company's common stock at an exercise price equal to the fair
market value of the common stock as of the date of grant as determined by the
Board (the "Option"). The Option shall be granted outside of the VaxGen, Inc,
1996 Stock Option Plan (the "Plan") but on terms substantially similar to the
terms of the Plan. The Option will be subject to the terms of the Executive's
grant agreement, which will include a four-year vesting schedule under which,
during Executive's continuous service to the Company (to be defined in the grant
agreement as such term is defined in the Plan), twenty-five percent (25%) of the
Option shares will vest on the one-year anniversary of the Hire Date and the
remaining Option shares will vest in equal monthly installments over the
subsequent three (3) years. Executive acknowledges that there are no further
commitments on behalf of the Company to grant to Executive any additional stock
options, although the Board will consider, on an annual basis, granting
additional stock options to Executive at the Board's sole discretion.
(e) Benefits. Executive shall be entitled to participate in the
Company's employee benefit plans which may be in effect from time to time and
provided by the Company to its senior officers generally, including paid
holidays, leaves of absence, health insurance, dental insurance, life insurance,
vacation and other benefits, if any, in accordance with and subject to the
eligibility requirements of such employee benefit plans and other applicable
policies and procedures. Executive's rights under such employee benefit plans,
or the rights of Executive's dependents, shall be governed solely by the terms
of such plans and any applicable policies and procedures. The Company's employee
benefit plans, and policies and procedures related thereto, are subject to
termination, modification or limitation at any time at the Company's sole
discretion.
(f) Relocation and Housing Assistance. To assist Executive in her
relocation from Doylestown, Pennsylvania to the San Francisco Bay Area, the
Company agrees:
(i) To pay a moving company, selected by Executive and
reasonably acceptable to the Company, to move Executive's household goods, at a
cost of up to $20,000;
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(ii) To provide temporary housing for Executive and her spouse
for up to ninety (90) days, during which Executive and her spouse will search
for permanent housing in the San Francisco Bay Area. The Company may extend the
provided temporary housing for up to an additional ninety (90) days, provided
that Executive has been unable to locate permanent housing despite her or her
spouse's reasonable efforts;
(iii) To reimburse Executive for her costs to rent a car after
her arrival in the San Francisco Bay Area for up to sixty (60) days, or until
her personal automobile is shipped to the San Francisco Bay Area, whichever
occurs first, provided that Executive must submit completed business expense
reports to the Company to be eligible for reimbursement;
(iv) To pay a housing allowance to Executive on the following
schedule during her first three years of employment, contingent upon her
continued employment during such time: (A) a monthly housing allowance of $4,000
during Executive's first year of employment; (B) a monthly housing allowance of
$3,000 during Executive's second year of employment; and (C) a monthly housing
allowance of $2,500 during Executive's third year of employment. The housing
allowances will be considered taxable income to Executive in accordance with
applicable law.
(g) Business Expenses. VaxGen shall reimburse Executive for all
reasonable business expenses, including expenses incurred for travel on VaxGen
business, in accordance with its policies and procedures, as may be adopted or
amended from time to time at VaxGen's sole discretion. To be eligible for
reimbursement, Executive must submit business expense reimbursement requests to
VaxGen on a monthly basis, which includes supporting documentation (including
receipts) reasonably satisfactory to VaxGen.
(h) Reimbursement of Legal Fees. The Company agrees to reimburse
Executive for reasonable attorney's fees incurred by the Executive in the
negotiation and preparation of this Agreement, up to a maximum amount of $5,000.
(i) Total Compensation. Executive agrees that the compensation
stated in this Agreement constitutes the full and exclusive monetary
consideration and compensation for all services provided by Executive to the
Company, and for all promises and obligations under this Agreement.
4. VAXGEN EMPLOYMENT POLICIES. Executive's employment relationship will be
governed by the general employment policies and practices of the Company (to the
extent not inconsistent with this Agreement), and Executive agrees to abide, in
all material respects, by all such policies, practices and procedures, written
and unwritten, as they may from time to time be adopted or modified by VaxGen at
its sole discretion. Executive also agrees to review and abide, in all material
respects, by the policies in VaxGen's Employee Handbook (as they may be modified
by the Company from time to time) and to acknowledge in writing that she has
read and will abide by the Employee Handbook.
5. PROTECTION OF COMPANY INFORMATION. As a condition of her employment,
Executive agrees to sign, contemporaneously with this Agreement, and to abide by
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the Employee's Proprietary Information and Inventions Agreement (the
"Proprietary Information Agreement") attached hereto as Exhibit A.
6. INDEMNITY AGREEMENT. Executive and the Company agree to enter into the
Indemnity Agreement attached hereto as Exhibit B.
7. OUTSIDE ACTIVITIES.
(a) Non-Company Activities. Except for any commitments consented to
in writing by the CEO, Executive will not during the term of this Agreement
undertake or engage in any other employment, occupation or business enterprise,
other than ones in which she is a passive investor. Executive may engage in
civic and not-for-profit activities so long as such activities do not materially
interfere with the performance of her duties hereunder.
(b) No Adverse Interests. During her employment, Executive agrees
not to acquire, assume or participate in, directly or indirectly, any position,
investment or interest known by her to be adverse or antagonistic to the
Company, its business or prospects, financial or otherwise, except as permitted
by Section 7(c).
(c) Noncompetition. During the term of her employment by the
Company, except on behalf of the Company, Executive will not directly or
indirectly, whether as an officer, director, stockholder, partner, proprietor,
associate, representative, consultant, employee, or in any capacity whatsoever,
engage in, become financially interested in, be employed by or have any business
connection with any other person, corporation, firm, partnership or other entity
whatsoever which competes directly with the Company, anywhere throughout the
world, in any line of business engaged in (or planned to be engaged in) by the
Company; provided, however, that Executive may own, as a passive investor,
securities of any competing public corporation, so long as her direct holdings
in any one such corporation shall not in the aggregate constitute more than one
percent (1%) of the voting stock of such corporation and any ownership interest
in a competitor is disclosed in writing to the Company's CEO.
8. FORMER EMPLOYMENT.
(a) Prior Employee Agreements and Information. Executive represents
and warrants that her employment by the Company will not conflict with and will
not be constrained by any prior employment or consulting agreement,
noncompetition agreement, proprietary information agreement or other
relationship with any third party. Executive further represents and warrants
that she is not in unauthorized possession or control of confidential materials
or information arising out of prior employment, consulting, or other third party
relationships, and that she will not make unauthorized use or disclosure of any
such materials or information in the course of her employment with the Company.
Executive further warrants that by entering into this Agreement with VaxGen, she
is not violating any of the terms, agreements or covenants of any agreement with
any third party, including but not limited to any previous employer, and that
she is not under any contractual obligation that would restrict her activities
on behalf of the Company.
(b) Use or Disclosure of Third Party Information. If, Executive
should find that confidential or proprietary information belonging to any third
party might be usable in connection with the Company's business, she will not
disclose it to the Company or use it on behalf of the Company except as
expressly authorized by such third party; but during her employment by the
Company, Executive will use in the performance of her duties only information
which is generally known and used by persons with training and experience
comparable to her own, common knowledge in the industry, otherwise legally in
the public
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domain, or which is obtained or developed by the Company or by Executive in the
course of her work for the Company.
9. NONINTERFERENCE.
While employed by the Company and for a period of one (1) year
immediately following the termination of her employment, Executive agrees that
she will not, without the express consent of an officer of the Company, or in
the course and scope of performing her duties for the Company, interfere with
the business of the Company by, either directly or indirectly:
(a) soliciting, recruiting, inducing, encouraging, or otherwise
causing any employee of VaxGen to terminate his or her employment in order to
become an employee, consultant or independent contractor to or for any other
person or entity, or attempting to do so;
(b) disclosing to any person or entity the names or addresses of, or
any information pertaining to, any current employees of VaxGen; or
(c) using Proprietary Information (as defined in the Proprietary
Information Agreement) to call on, solicit or take away any clients or customers
of VaxGen or any other persons, entities, or corporations with which VaxGen has
had or planned to have any business transaction or relationship during
Executive's employment with VaxGen (such Proprietary Information to include, but
not be limited to, investments, licenses, joint ventures, and agreements for
development), or attempting to do so.
10. TERMINATION OF EMPLOYMENT.
(a) At-Will Employment Relationship. Executive's employment
relationship is at-will. This means that Executive's employment and/or this
Agreement may be terminated with or without Cause (as defined herein), and with
or without advance notice, at any time by either Executive or by VaxGen. Nothing
in this document shall limit the right to terminate employment at will or to
terminate this Agreement at any time. This at-will employment relationship can
only be changed in a written agreement approved by the Board and signed by
Executive and a duly authorized officer of the Company.
(b) Termination Without Cause. In the event that Executive's
employment is terminated without Cause by the Company, Executive shall be
eligible to receive the following as her sole severance benefits (collectively,
the "Severance Benefits"): (i) severance pay in the amount of twelve (12) months
of her base salary in effect as of the termination date (such severance being
limited strictly to base salary and will not include any amount paid or payable
as a bonus or stock option grant), less standard withholdings and deductions,
and payable in the Company's ordinary payroll cycle as salary continuation until
fully paid unless a different payment schedule is agreed upon in writing by the
parties; (ii) COBRA continuation coverage at her own expense under the Company's
health insurance program; (iii) all stock option grants then held by Executive
shall be subject to accelerated vesting such that all unvested shares will
become fully vested and exercisable effective as of the employment termination
date (the "Accelerated Vesting"); and (iv) payment of all accrued salary and all
accrued and unused vacation as well as benefits under any written ERISA
qualified benefit plan (e.g. 401(k) plan), or written insurance policy, to which
Executive has a vested right as of the termination date. In the event that
Executive's employment is terminated without Cause by the Company within
thirteen (13) months after a Change in Control (defined below), then in
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addition to receiving the Severance Benefits, Executive shall receive a bonus
payment for the compensation year in which the termination occurs, such payment
to be prorated based on the termination date and calculated based on the target
bonus amount for which Executive is eligible for the compensation year in which
the termination occurs, if any, provided that Executive will not be entitled to
such bonus payment if she otherwise received a bonus payment for the
compensation year in which the termination occurs (the "Prorated Bonus"). Also
in the event that Executive's employment is terminated without Cause by the
Company after a Change in Control, Executive may be entitled to receive a
Gross-Up Payment, as defined in Section 10(b)(ii), in accordance with the
provisions of Sections 10(b)(ii)-(iv). As a condition of and prior to the
receipt of all or any of the Severance Benefits, Accelerated Vesting, or
Prorated Bonus, Executive shall provide the Company with an effective general
release of all known and unknown claims, substantially in the form attached as
Exhibit C.
(c) Resignation for Good Reason. If Executive has Good Reason,
Executive may resign at any time within thirteen (13) months following a Change
in Control by providing written notice to the Company that specifies the reason
for, and effective date of Executive's resignation. If Executive resigns for
Good Reason such resignation shall be deemed a Termination without Cause
following a Change in Control as set forth herein and Executive shall receive
the compensation and benefits provided herein as if Executive had been
terminated without Cause following such Change in Control. "Good Reason" shall
mean the occurrence of any of the following events following a Change in
Control: (A) the assignment to Executive of any duties inconsistent with
Executive's senior management position, authority, duties or responsibilities
immediately prior to a Change in Control; (B) a reduction by the Company in
Executive's annual Base Salary in effect immediately prior to a Change in
Control (except where such reductions are imposed uniformly on senior executives
in the post-transaction parent company); (C) a relocation of Executive's place
of work that would increase Executive's one-way commuting distance by more than
thirty-five (35) miles over her commute immediately prior to a Change in
Control; (D) the failure to continue to provide Executive with benefits
substantially similar to those enjoyed by Executive under any of the Company's
benefit plans in which Executive was participating prior to a Change in Control;
(E) the failure to pay Executive any deferred compensation due to Executive; or
(F) a material breach by the Company of any of the terms and provisions of this
Agreement resulting in material harm to Executive.
(d) Definition of Change in Control. For the purposes of this
Agreement, Change in Control shall be deemed to have occurred if: (i) there is
an acquisition by any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) (for the purposes of this Section, a "Person") of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 50% or more of the voting power of the then outstanding voting securities of
VaxGen entitled to vote generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however, that for purposes of this
subsection 10(b), any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by VaxGen or any corporation controlled by VaxGen
shall not constitute a Change in Control; or (ii) individuals who, as of the
date hereof, constitute the Board (the "Incumbent Board") cease for any reason
to constitute at least a majority of the Board; provided, however, that any
individual (other than an individual whose initial assumption of office occurs
as a result of an actual or threatened solicitation of proxies or consents by or
on behalf of a Person other than the Board) who
6.
becomes a director subsequent to the date hereof whose election or nomination
for election by VaxGen's shareholders was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board; or
(iii) there is a consummation of a reorganization, merger or consolidation or
sale or other disposition of all or substantially all of the assets of VaxGen (a
"Business Combination") unless, following such Business Combination, (A)
individuals and entities who were the beneficial owners of the Outstanding
Company Voting Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50% of the voting power of
the then Outstanding Company Voting Securities of the corporation resulting from
such Business Combination (including, without limitation, a corporation which as
a result of such transaction owns VaxGen or all or substantially all of VaxGen's
assets either directly or through one or more subsidiaries) and (B) at least a
majority of the members of the board of directors of the corporation resulting
from such Business Combination were members of the Incumbent Board at the time
of the execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or (iv) approval by the shareholders of
VaxGen of a complete liquidation or dissolution of VaxGen.
(e) Gross-Up Payment. Subject to the limitation of Section
10(b)(iv), if it shall be determined that any payment or distribution of any
type to or for the benefit of Executive, whether paid or payable or distributed
or distributable pursuant to the terms of this Agreement or otherwise (the
"Total Payments"), is or will be subject to the excise tax imposed by Section
4999 of the Internal Revenue Code of 1986, as amended (the "Code"), or any
interest or penalties with respect to such excise tax (such excise tax, together
with any such interest and penalties, are collectively referred to as the
"Excise Tax"), then Executive shall be entitled to receive an additional payment
(a "Gross-Up Payment") in an amount such that after payment by Executive of all
taxes (including any interest or penalties imposed with respect to such taxes),
including any Excise Tax, imposed upon the Gross-Up Payment, Executive retains
an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Total
Payments.
(f) Determination By Accountant. All mathematical determinations,
and all determinations as to whether any of the Total Payments are "parachute
payments" (within the meaning of Section 280G of the Code), that are required to
be made under Section 10(b)(ii), including determinations as to whether a
Gross-Up Payment is required and the amount of such Gross-Up Payment, shall be
made by an independent accounting firm selected by Executive from among the four
(4) largest accounting firms in the United States (the "Accounting Firm"),
subject to the limitation of Section 10(b)(iv). The Accounting Firm shall
provide its determination (the "Determination"), together with detailed
supporting calculations regarding the amount of any Gross-Up Payment and any
other relevant matter, both to the Company and Executive by no later than ten
(10) days following the date of Executive's termination of employment, if
applicable, or such earlier time as is requested by the Company or Executive (if
Executive reasonably believes that any of the Total Payments may be subject to
the Excise Tax). If the Accounting Firm determines that no Excise Tax is payable
by Executive, it shall furnish Executive and the Company with a written
statement that such Accounting Firm has concluded that no Excise Tax is payable
(including the reasons therefor) and that Executive has substantial authority
not to report any Excise Tax on her federal income tax return. If a Gross-Up
Payment is determined to be payable, it shall be paid to Executive within twenty
(20) days after the Determination (and all accompanying calculations and other
material supporting the Determination) is delivered to the
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Company by the Accounting Firm. Any determination by the Accounting Firm shall
be binding upon the Company and Executive, absent manifest error. As a result of
uncertainty in the application of Section 4999 of the Code at the time of the
initial determination by the Accounting Firm hereunder, it is possible that
Gross-Up Payments not made by the Company should have been made
("Underpayment"), or that Gross-Up Payments will have been made by the Company
which should not have been made ("Overpayments"). In either such event, the
Accounting Firm shall determine the amount of the Underpayment or Overpayment
that has occurred. In the case of an Underpayment, the amount of such
Underpayment shall be promptly paid by the Company to or for the benefit of
Executive. In the case of an Overpayment, Executive shall, at the direction and
expense of the Company, take such steps as are reasonably necessary (including
the filing of returns and claims for refund), follow reasonable instructions
from, and procedures established by, the Company, and otherwise reasonably
cooperate with the Company to correct such Overpayment; provided, however, that
(i) Executive shall not in any event be obligated to return to the Company an
amount greater than the net after-tax portion of the Overpayment that she has
retained or has recovered as a refund from the applicable taxing authorities and
(ii) this provision shall be interpreted in a manner consistent with the intent
of Section 10(b)(ii), which is to make Executive whole, on an after-tax basis,
from the application of the Excise Tax, it being understood that the correction
of an Overpayment may result in Executive repaying to the Company an amount
which is less than the Overpayment.
(g) Certain Limitations. Notwithstanding Sections 10(b)(ii) and
10(b)(iii), the amount of the Gross-Up Payment shall be subject to the
limitation that the aggregate amount of gross-up payments in respect of the
excise tax imposed by Section 4999 of the Code, including the Gross-Up Payment,
that may be paid to employees of the Company, including Executive, shall not
exceed 2.5% of the aggregate cash equivalent value of consideration delivered by
the individuals or entities effecting the Change in Control, excluding from this
calculation any consideration that is contingent on uncertain future events
(such limitation is hereinafter referred to as the "Gross-Up Payment
Limitation"). If the Gross-Up Payment Limitation would be exceeded, then the
gross-up payment of each employee, including Executive, shall be reduced pro
rata so that the sum of all gross-up payments, including the Gross-Up Payment,
will equal the Gross-Up Payment Limitation. Moreover, if gross-up payments may
be paid to employees of the Company in addition to Executive, the Accounting
Firm for purposes of Section 10(b)(iii) shall be the accounting firm engaged by
the Company for general audit purposes as of the day prior to the effective date
of the Change in Control; provided, however, that if such accounting firm is
serving as accountant or auditor for the individual or entity effecting the
Change in Control, the Company shall appoint a nationally recognized accounting
firm as the Accounting Firm for purposes of Section 10(b)(iii). Upon the
occurrence of a Change in Control, the Accounting Firm shall calculate the
Gross-Up Payment Limitation. The limitation on the gross-up payment of each
employee, including the Gross-Up Payment of Executive, as a result of the
Gross-Up Payment Limitation shall be applied as if all employees, including
Executive, had terminated employment and become entitled to gross-up payments on
the earliest date that any employee, including Executive, terminates employment
with entitlement to a gross-up payment, including the Gross-Up Payment, and
there shall be no re-determination of such limitations at any time thereafter,
even if one or more of such employees thereafter do not become entitled to
receive a gross-up payment.
(h) Termination for Cause.
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(i) No Severance. In the event Executive's employment is
terminated at any time for Cause, Executive will be entitled to payment of all
accrued salary and accrued and unused vacation, but Executive will not be
entitled to the Severance Benefits, pay in lieu of notice, or any other such
compensation.
(ii) Cause Definition. For purposes of this Agreement, "Cause"
for termination shall mean any of the following: (A) fraud or illegal acts
committed by Executive; (B) Executive's material breach of any written agreement
with the Company, including but not limited to this Agreement or the Proprietary
Information Agreement; (C) Executive's material failure to perform her job
duties as determined by the Company in its reasonable judgment, and after notice
of such failure and the reasons therefor have been given to Executive by the CEO
and Executive has had a thirty (30) business-day period within which to cure
such failure (such notice to be provided only if Executive's failure is
reasonably susceptible to cure); or (D) a material violation of any VaxGen
employment policy, including but not limited to VaxGen's policies against
harassment and discrimination, and/or VaxGen's substance abuse policy, which
violation causes material harm to the Company.
(i) Voluntary or Mutual Termination. In the event Executive
terminates her employment, or in the event that Executive's employment
terminates at the parties' mutual agreement, Executive will be entitled to
payment of all accrued salary and accrued and unused vacation, but Executive
will not be entitled to Severance Benefits, pay in lieu of notice, or any other
such compensation.
(j) Termination Due to Death. In the event of Executive's death, or
termination of Executive's employment as a result of Executive's incapacity due
to physical or mental illness that prevents Executive from substantially
performing the essential functions of Executive's job (even with reasonable
accommodation), Executive's employment will terminate on the date thereof, and
Executive and Executive's heirs or estate will be entitled to payment of all
accrued salary and accrued and unused vacation, but Executive will not be
entitled to Severance Benefits, pay in lieu of notice or any other such
compensation. Nothing herein shall prevent Executive or Executive's estate from
receiving the benefit of applicable life insurance or disability insurance, if
any.
11. GENERAL PROVISIONS.
(a) Governing Law. This Agreement shall be construed in accordance
with and governed by the laws of the State of California without regard to
conflict of laws principles that would otherwise apply the law of another
jurisdiction. Any ambiguity in this Agreement shall not be construed against
either party as the drafter.
(b) Complete Agreement. This Agreement, including the Proprietary
Information Agreement, and the Indemnity Agreement, constitutes the complete,
final and exclusive embodiment of the entire agreement and understanding of the
parties with regard to the subject matter hereof. It is entered into without
reliance on any promise, warranty or representation other than those expressly
contained herein, and it supersedes and replaces any and all prior or
contemporaneous agreements, promises or representations between VaxGen and
9.
Executive, whether oral, written or implied, including but not limited to any
and all term sheets. The terms of this Agreement and any changes in Executive's
employment terms (other than those employment terms expressly reserved to the
Company's discretion in this Agreement), require a written amendment to the
Agreement signed by Executive and a duly authorized officer of the Company.
The parties agree that any provision in this Agreement under which Executive is
entitled to post-termination severance benefits, including but not limited to
any applicable bonus payments, under certain specified conditions shall survive
the termination of Executive's employment.
(c) Waiver. Any waiver of a breach of this Agreement shall be in
writing and shall not be deemed to be a waiver of any successive breach.
(d) Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, and such invalid, illegal or
unenforceable provision will be reformed, construed and enforced in such
jurisdiction so as to render it valid, legal, and enforceable consistent with
the general intent of the parties insofar as possible.
(e) Voluntary Agreement. Executive and VaxGen represent and warrant
that each has reviewed all aspects of this Agreement, has carefully read and
fully understands all provisions of this Agreement, and is voluntarily entering
into this Agreement. Each party represents and agrees that such party has had
the opportunity to review any and all aspects of this Agreement with the legal
and tax advisors of such party's choice before executing this Agreement, and
each party has had a full opportunity to negotiate the terms of this Agreement
prior to signing this Agreement.
(f) Headings. The headings and captions of the various paragraphs of
this Agreement are placed herein for the convenience of the parties and the
reader, do not constitute a substantive term or terms of this Agreement, and
shall not be considered in the interpretation or application of this Agreement.
(g) Counterparts. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more than one
party, but all of which taken together will constitute one and the same
Agreement. Signatures transmitted via facsimile shall be deemed the equivalent
of originals.
(h) Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of and shall be enforceable by and against Executive and
the Company, and their respective successors, assigns, heirs, executors and
administrators; except that it is agreed that Executive may not assign any of
her duties hereunder; and Executive may not assign any of Executive's rights
hereunder without the written consent of the Company, which shall not be
unreasonably withheld.
(i) Notices. Any notices provided hereunder must be in writing and
shall be deemed effective upon, as applicable, the date of personal delivery
(including personal delivery by facsimile transmission), the date of delivery by
express delivery service (e.g. Federal Express), or the third day after mailing
by certified or registered mail, return receipt requestesd, to the attention of
the CEO sent to the Company's corporate headquarters, and to Executive at her
10.
address as listed on the Company's payroll, or as otherwise provided in writing
by Executive to the CEO.
(j) Alternative Dispute Resolution. To ensure rapid and economical
resolution of any disputes which may arise concerning the relationship between
Executive and the Company, the parties hereby agree that any and all claims,
disputes or controversies of any nature whatsoever arising out of, or relating
to, this Agreement, Executive's employment with the Company, or the termination
of such employment, shall be resolved, to the fullest extent permitted by law,
by final, binding and confidential arbitration in San Francisco, California
conducted before a single arbitrator by JAMS, Inc. ("JAMS") or its successor,
under the then applicable JAMS arbitration rules. The parties each acknowledge
that by agreeing to this arbitration procedure, they waive the right to resolve
any such dispute, claim or demand through a trial by jury or judge or by
administrative proceeding. Executive will have the right to be represented by
legal counsel at any arbitration proceeding. The arbitrator shall: (i) have the
authority to compel adequate discovery for the resolution of the dispute and to
award such relief as would otherwise be available under applicable law in a
court proceeding; and (ii) issue a written statement signed by the arbitrator
regarding the disposition of each claim and the relief, if any, awarded as to
each claim, the reasons for the award, and the arbitrator's essential findings
and conclusions on which the award is based. The arbitrator, and not a court,
shall also be authorized to determine whether the provisions of this paragraph
apply to a dispute, controversy, or claim sought to be resolved in accordance
with these arbitration procedures. The Company shall bear all JAMS' arbitration
fees and administrative costs. Nothing in this Agreement is intended to prevent
either Executive or the Company from obtaining injunctive relief in court to
prevent irreparable harm pending the conclusion of any arbitration.
(k) Right To Work. As required by law, this Agreement is subject to
satisfactory proof of Executive's right to work in the United States.
11.
IN WITNESS WHEREOF, the parties have executed this Agreement on the dates
specified below.
VAXGEN, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇, Ph.D.
Chief Executive Officer
Date: September 29, 2004
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ACCEPTED AND AGREED:
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Ph.D.
September 30, 2004
----------------------------------
Date
Exhibit A - Employee's Proprietary Information and Inventions Agreement
Exhibit B - Indemnity Agreement
Exhibit C - Form of Release
12.
EXHIBIT A
EMPLOYEE'S PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT
EXHIBIT B
INDEMNITY AGREEMENT
EXHIBIT C
FORM OF RELEASE
In consideration for the Severance Benefits provided to me by VaxGen, Inc.
(the "Company"), as required by the Executive Employment Agreement (the
"Agreement") between the Company and me dated October 15, 2004, I hereby give
the following Release (the "Release").
Except for claims to enforce my rights to Severance Benefits provided in
Section 10 of the Agreement, I hereby generally and completely release the
Company and its directors, officers, employees, shareholders, partners, agents,
attorneys, predecessors, successors, parent and subsidiary entities, insurers,
affiliates, and assigns from any and all claims, liabilities and obligations,
both known and unknown, that arise out of or are in any way related to events,
acts, conduct, or omissions occurring at any time prior to or contemporaneous
with my signature of this Release. This general release includes, but is not
limited to: (1) all claims arising out of or in any way related to my employment
with the Company or the termination of that employment; (2) all claims related
to my compensation or benefits from the Company, including salary, bonuses,
commissions, vacation pay, expense reimbursements, severance pay, fringe
benefits, stock, stock options, or any other ownership or equity interests in
the Company; (3) all claims for breach of contract, wrongful termination, and
breach of the implied covenant of good faith and fair dealing, including, but
not limited to, claims based on or arising from the Executive Employment
Agreement; (4) all tort claims, including claims for fraud, defamation,
emotional distress, and discharge in violation of public policy; and (5) all
federal, state, and local statutory claims, including claims for discrimination,
harassment, retaliation, attorneys' fees, or other claims arising under the
federal Civil Rights Act of 1964 (as amended), the federal Americans with
Disabilities Act of 1990, the federal Age Discrimination in Employment Act (as
amended) ("ADEA"), and the California Fair Employment and Housing Act (as
amended). I represent that I have no lawsuits, claims or actions pending in my
name, or on behalf of any other person or entity, against the Company or any
other person or entity subject to the release granted in this paragraph.
I acknowledge that I am knowingly and voluntarily waiving and releasing
any rights I may have under the ADEA, and that the consideration given for the
waiver and release in the preceding paragraph is in addition to anything of
value to which I am already entitled. I further acknowledge that I have been
advised by this writing that: (a) my waiver and release do not apply to any
rights or claims that may arise after the date I sign this Release; (b) I should
consult with an attorney prior to signing this Release (although I may choose
voluntarily not to do so); (c) I have twenty-one (21) days to consider this
Release (although I may choose voluntarily to sign it earlier); (d) I have seven
(7) days following the date I sign this Release to revoke it by providing
written notice of revocation to the Company's Chief Executive Officer; and (e)
this Release will not be effective until the date upon which the revocation
period has expired, which will be the eighth calendar day after the date I sign
it (the "Effective Date").
I UNDERSTAND THAT THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND
UNKNOWN CLAIMS. I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A general release does not
extend
to claims which the creditor does not know or suspect to exist in his favor at
the time of executing the release, which if known by him must have materially
affected his settlement with the debtor." I hereby expressly waive and
relinquish all rights and benefits under that section and any law or legal
principle of similar effect in any jurisdiction with respect to my release of
claims herein, including but not limited to the release of unknown and
unsuspected claims.
By:
---------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Ph.D.
Date:
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