VICAL INCORPORATED
0000 XXXXX XXXXXX XXXXX XXXXXXX 00.00
XXXXX 000
XXX XXXXX, XX 00000
February 5, 2002
Xx. Xxxxx X. Xxxxxx
RE: AMENDMENT TO NOVEMBER 28, 2000 LETTER REGARDING EMPLOYMENT TERMS
Dear Xxxxx:
This Amendment (the "AMENDMENT") to your Letter Agreement with Vical
Incorporated (the "COMPANY") dated November 28, 2000 (the "AGREEMENT") will
amend the terms and conditions of the Agreement to the extent provided herein.
Except as specifically amended by this Amendment, the terms and conditions of
the Agreement shall remain in full force and effect.
Paragraph 6 of the Agreement is hereby deleted in its entirety and replaced with
the following:
"6. RELOCATION. To assist you in moving to the San Diego area, we are
prepared to pay the reasonable and customary expenses of relocating
you and your family, not to exceed $60,000 (the aggregate amount of
relocation expenses for which you are entitled to reimbursement
hereunder shall be referred to herein as the "Relocation Expense
Amount"), and such Relocation Expense Amount shall be subject to
offset as provided in this Section 6 below. In addition, in the
event your residence in Pennsylvania is prepared and maintained
(including customary insurance coverage) for sale in reasonable
condition and listed for sale by September 1, 2002, the Company
will reimburse you up to $100,000 of any loss you incur on its
sale; PROVIDED THAT, in the event such a loss is anticipated,
the Company or its designees may, at the Company's sole discretion,
purchase that residence for an amount equal to its cost to you
(estimated to be approximately $550,000). The Company will also
loan to you an amount not to exceed $500,000 for the purpose of
purchasing a residence in the San Diego area, such loan to be
evidenced by a promissory note bearing interest at the lowest
applicable federal rate necessary to avoid imputed interest income
under the Internal Revenue Code and secured by a second deed of
trust on the residence. The loan will be due and payable upon the
earlier of (A) the sale of that residence, (B) 90 days following
the termination of your employment for any reason or (C) January 1,
2007. Once you and your family have relocated to the San Diego
area, the Company will provide to you for a period not to exceed 24
months, a monthly housing cost-of-living differential payment of up
to $2,500 per month. Further, the Company will either pay the
costs, not to exceed $3,500 per month, of temporary housing for you
in San Diego or, at the Company's option, provide temporary housing
to you until the earlier of your purchase of a San Diego residence
or
1.
December 31, 2002. You shall also receive the following: (i) a
payment from the Company sufficient to pay the income, employment
and any other taxes you incur arising from the actual monthly
temporary housing payments received by you or, if the Company
provides temporary housing to you, the amount of income imputed to
you with respect thereto; and (ii) an additional payment from the
Company sufficient to pay the income, employment and any other
taxes arising from the payments made by the Company pursuant to
Section 6(i) above and this Section 6(ii) so that you shall be
fully reimbursed for any income, employment and any other taxes you
incur associated with the payments to reimburse you for such
income, employment and other taxes on such amounts (the aggregate
amount paid to you under Sections 6(i) and 6(ii) herein shall be
referred to herein as the "Gross-up Amount"). The Gross-up Amount
shall be offset against and, thus, subtracted from the Relocation
Expense Amount but, in no event, shall the Relocation Expense
Amount be less than zero. The Company will also reimburse you for
the reasonable costs of one trip per month in connection with your
commuting to San Diego from your home in Pennsylvania, until the
earlier of your purchase of a San Diego residence or December 31,
2002. Except as specifically provided herein, you will be
responsible for any personal taxes (income, employment or
otherwise) arising from any of the payments described herein,
except that the Company will reimburse you for personal taxes
arising from the payment of any Relocation Expense Amount (to the
extent not offset by the Gross-up Amount).
This Amendment shall be governed by and construed in accordance with the laws of
the State of California, without regard to conflicts of law principles.
Please sign and date this Amendment and return it to me at your earliest
convenience.
Sincerely,
VICAL INCORPORATED
By: /s/ XXXXXX X. XXXXXX
----------------------
Xxxxxx X. Xxxxxx
Vice President & Chief Financial Officer
ACCEPTED AND AGREED:
/s/ XXXXX X. XXXXXX
--------------------
Xxxxx X. Xxxxxx
MARCH 8, 2002
Date
2.
