EXHIBIT 10.80
January 4, 2001
Xx. Xxxxxx X. Xxxxx
Dear Xxxxxx:
This letter shall serve to confirm the terms of employment offered to you
by Ribozyme Pharmaceuticals, Inc. (the "Company") and acknowledge your
acceptance of the employment on such terms as detailed below. Capitalized terms
used herein and not otherwise defined herein shall have the meanings ascribed to
them on Appendix 1 hereto.
1. Positions and Scope of Employment. As of the Commencement Date, you
shall serve as President and Chief Operating Officer of the Company, provided
that, subject to any prior termination in accordance with the terms hereof, on
July 1, 2001, you shall resign from the position of Chief Operating Officer and
assume the position of President and Chief Executive Officer. You shall render
such business and professional services in the performance of your duties,
consistent with your then current position within the Company, consistent with
the Bylaws of the Company and (i) from the Commencement Date until June 30,
2001, as shall be reasonably assigned to you by the Chief Executive Officer of
the Company, and during such period you shall report directly to the Chief
Executive Officer, and (ii) from and after July 1, 2001, as shall reasonably be
assigned to you by the Company's Board of Directors (the "Board"), and you shall
then report directly to the Board. You shall perform your duties faithfully and
to the best of your ability and shall devote your full business efforts and time
to the Company. The Company agrees that you shall be nominated and elected to
the Board of Directors at the next scheduled meeting of the Board to be held on
March 22, 2001. For purposes hereof the "Commencement Date" shall be such date
as you shall determine, in your sole discretion, to commence your employment,
provided however, that in no event shall such date be later than February 1,
2001.
2. Compensation.
(a) Base Salary. During the period beginning on the Commencement
Date and ending on June 30, 2001, the Company shall pay to you as compensation
for your services a base salary at the annualized rate of $300,000, which amount
shall be increased to $325,000 (in each case, as applicable, the "Base Salary")
on July 1, 2001. Your Base Salary shall be increased, effective January 1, 2002
to at least an annualized rate of $341,250 and, from and after December 31,
2002, shall be subject to annual review by the Board for appropriate upward
adjustment. Your Base Salary shall be paid in accordance with the Company's
normal payroll practices.
(b) Bonus. In each year of your employment with the Company you
shall be eligible to earn a bonus. The annual bonus shall be based upon
attainment of reasonable and achievable goals which shall be mutually agreed
upon by you and the Chief Executive Officer with
respect to such goals applicable to the period from the Commencement Date
through June 30, 2001, and by you and the Board with respect to such goals
applicable to any period after July 1, 2001. For the period from the
Commencement Date through December 31, 2001, the amount of the annual bonus
which you shall be eligible to earn shall be equal to forty-five percent (45%)
of your annual Base Salary in effect as of July 1, 2001, and for the period from
January 1, 2002 through December 31, 2002, and for each calendar year
thereafter, the amount of the annual bonus which you shall be eligible to earn
shall be equal to forty-five percent (45%) of your then annual Base Salary,
subject to annual review by the Board for appropriate upward adjustment. Such
bonus shall be payable in a cash lump sum within thirty (30) days after the end
of the calendar year with respect to which the bonus is payable.
(c) Options. Upon the Commencement Date, the Company shall grant to
you stock options to purchase 275,000 shares of the Company's common stock and,
thereafter, you shall be granted stock options to purchase an additional 5,000
shares of the Company's common stock on the first day of each of February,
March, April, May and June, 2001, which, in each case, shall be exercisable for
a period of ten (10) years at an exercise price equal to Fair Market Value (as
defined in the Company's stock option plan) of the date of the stock option
grant. On January 1, 2002, the Company shall grant to you additional stock
options to purchase a minimum of 60,000 shares, which shall be exercisable for a
period of ten (10) years at an exercise price equal to Fair Market Value (as
defined in the Company's stock option plan) of the date of the stock option
grant. In subsequent years, the Company shall grant to you stock options to
purchase such reasonable number of additional shares of the Company's common
stock, exercisable for such period of time and at such exercise price as the
Board may determine. Fifty percent (50%) of each stock option grant shall vest,
annually, in arrears, over a period of four years at the rate of twenty-five
percent (25%) per year (the "Time-Vested Options"), and the remaining fifty
percent (50%) vesting upon the attainment of reasonable and achievable goals
that shall be mutually agreed upon by you and the Board (the "Performance-Vested
Options"). Each stock option grant shall be in the form of incentive stock
options in the maximum amount permitted by applicable law.
(d) Employee Benefits. During your employment with the Company, you
shall be entitled to participate in the employee benefit plans currently and
hereafter maintained by the Company which shall include, without limitation, the
following:
(i) group PPO medical and dental insurance plans (the
coverage under which shall include your dependents and contain no
restrictions relative to pre-existing conditions and no waiting period
prior to coverage becoming effective);
(ii) short-term disability insurance (with a fourteen (14) day
waiting period) and long-term disability insurance (with a ninety (90) day
waiting period) with a benefit of at least sixty percent (60%) of
predisability income up to a maximum benefit of $250,000 annually (which
coverage shall contain no restrictions relative to pre-existing
conditions). The Company shall use its best efforts to obtain for your
benefit additional long-term disability coverage up to a maximum benefit of
$250,000 annually, at your expense (but only to the extent of the premium
cost for the annual benefit in excess of $72,000), at the group rates
applicable to the Company (which coverage shall contain no restrictions
relative to pre-existing conditions);
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(iii) term life insurance in the amount of $250,000, with
your having the right to designate the beneficiary(ies) thereof;
(iv) participation (eligible on the first plan entry date
following the six-month anniversary of the Commencement Date) in the
Company's 401(k) plan, your contributions to which may be matched by the
Company with contributions of shares of its common stock if approved by the
Board; provided that any such matching contributions shall vest over three
(3) years of service;
(v) participation in the Company's Flexible Spending
Account; and
(vi) participation (within six (6) months after the
Commencement Date) in the Company's Stock Purchase Plan, allowing purchase
of shares of the Company's common stock at fifteen percent (15%) below the
market price.
The Company reserves the right to revise, add or rescind any benefits
at any time for its employees generally; provided that any such permitted
revision, addition or rescission of benefits by the Company shall be without
prejudice to your rights provided in Section 5(d) hereof.
(e) Vacation Days; Sick Days; Holidays. You shall be entitled to
paid vacation, sick days and holidays in accordance with the Company's policies
as in effect from time to time.
(f) Expenses. The Company shall reimburse you for reasonable
travel, entertainment or other expenses incurred by you in the furtherance of or
in connection with the performance of your duties hereunder, in accordance with
the Company's expense reimbursement policy as in effect from time to time.
3. Loan. On the Commencement Date, the Company shall provide to you an
interest-free loan in the amount of $400,000 (the "Loan"). Subject to the
provisions hereof, the Company shall forgive twenty percent (20%) of the
original principal amount of the Loan on the anniversary date of the
Commencement Date until the Loan has been fully forgiven, provided, however,
that the Loan shall be fully forgiven in the event of termination of your
employment due to your death or permanent disability (as hereinafter defined).
In the event that it shall be determined that any payment shall be due by you
for taxes of any kind or nature relating to the forgiveness of the Loan or the
imputation of interest in connection therewith ("Taxes"), the Company shall
deliver to you an additional payment in an amount such that, after payment of
any taxes applicable to such additional payment by the Company, the net amount
available to you after payment of all such taxes shall be equal to the Taxes
payable by you, together with any interest or penalties associated therewith (a
"Gross-Up Payment").
4. Relocation Expenses. The Company agrees that it shall pay or
reimburse you for all reasonable out-of-pocket relocation and relocation-related
expenses which may be billed directly to the Company or paid by you and
submitted for reimbursement, including, without limitation, the following:
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(a) costs of services of moving companies (including packing,
transportation and relocation expenses, including the
transportation of automobiles);
(b) costs associated with your search for a new residence
(including, without limitation, the costs of airfare,
automobile rental, meals and hotel accommodations for
yourself and your immediate family);
(c) commissions payable to brokers in connection with the sale
of your current residence;
(d) costs attendant to the sale of your current residence and
the purchase of a new residence in the Boulder, Colorado
area (including, without limitation, the costs of home
inspections, survey, appraisal, title insurance, transfer
fees, attorneys' fees, accountants' fees and closing costs);
(e) loan origination fees (points) related to the purchase of
your new residence in an amount of up to three percent (3%)
of the loan amount;
(f) costs associated with commuting from your current residence
to the Company's offices (including, without limitation, the
costs of airfare, automobile rental, meals and hotel
accommodations for you) for a period of up to six (6)
months, subject to extension upon our mutual agreement;
(g) automobile rental charges prior to establishment of a
permanent residence in Boulder, Colorado;
(h) rent and other expenses associated with temporary housing
for yourself and your immediate family for a period of up to
six (6) months (which may include up to two (2) months after
the purchase and closing of title on your new residence),
subject to extension upon our mutual agreement; provided,
however, that such period may be extended through September
15, 2001, at your option (irrespective of whether you have
purchased and closed title on your new residence), for
purposes of satisfying residency requirements associated
with your child's school registration in the school district
of your choice;
(i) the Company agrees to make available to you upon your
request an interest free bridge loan in the amount of up to
$2,500,000 for a term of up to six (6) months, subject to
extension upon our mutual agreement; and
(j) payment of any duplicate mortgage loan payments and house
expenses to preclude your paying for your current residence
and your new residence concurrently.
All such payments shall be subject to the Company receiving reasonably
acceptable documentation evidencing the incurring of such cost, expense or fee.
In the event that it shall be determined that any payment shall be due by you
for taxes of any kind or nature relating to amounts paid to you or on your
behalf by the Company in connection with your relocation as provided above, the
Company shall deliver to you a Gross-Up Payment, except that no such Gross-Up
Payment shall be payable by the Company with respect to the interest free bridge
loan described in clause (i) above.
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5. Termination.
(a) At-Will Employment. You and the Company agree that your
employment with the Company shall be "at-will" employment, that you are free to
resign and, subject to the provisions hereof, the Company is free to terminate
your employment at any time, without notice, procedure or formality, with or
without Cause (for any reason or no reason).
(b) Voluntary Termination; Termination for Cause. In the event that
your employment with the Company is terminated voluntarily by you or for Cause
by the Company, then (i) all options which have vested shall continue to be
exercisable in accordance with the terms of the Company's stock option plan and
applicable legal requirements; (ii) all payments of Base Salary and bonuses
accrued but unpaid on the date of termination, as well as all expenses incurred
to the date of termination, shall be due and payable to you immediately and all
further compensation by the Company to you hereunder shall terminate as of the
date of termination; (iii) the unforgiven balance of the Loan shall be repaid by
you within thirty (30) days of the date of termination; and (iv) you shall be
entitled to continue medical and dental insurance coverage for yourself and your
dependents, at your expense, at the same level of coverage as was provided to
the you under the Company's insurance plan immediately prior to the termination
("Health Care Coverage") by electing COBRA continuation coverage ("COBRA") in
accordance with applicable law.
(c) Termination upon Death or Disability. In the event that your
employment with the Company is terminated as a result of your death or permanent
disability then (i) all options which have vested shall continue to be
exercisable in accordance with the terms of the Company's stock option plan and
applicable legal requirements; (ii) the Company shall pay to you or your estate,
as applicable, all payments of Base Salary and bonuses accrued but unpaid on the
date of termination, as well as expenses incurred to the date of termination,
immediately upon the date of termination and all further compensation by the
Company to you hereunder shall terminate as of the date of termination, (iii)
the Company shall forgive all amounts owed by you or your estate, as applicable,
in connection with the Loan and make any necessary Gross-Up Payment; (iv) you
shall be entitled to continue medical and dental insurance coverage for yourself
and your dependents, at your expense, at the same level of coverage as was
provided to you under the Company's Health Care Coverage by electing COBRA in
accordance with applicable law. For purposes hereof, the term "permanent
disability" shall mean your inability to perform your duties hereunder on
account of illness, accident or other physical or mental incapacity which shall
continue for a consecutive period of ninety (90) days or an aggregate of one
hundred twenty (120) days in any consecutive twelve-month period.
(d) Termination without Cause or for Good Reason. In the event that
your employment with the Company is terminated by the Company without Cause or
by you for Good Reason, then (i) all options which have vested shall continue to
be exercisable in accordance with the terms of the Company's stock option plan
and applicable legal requirements; (ii) all payments of Base Salary and bonuses
accrued but unpaid on the date of termination, as well as all expenses incurred
to the date of termination, shall be due and payable to you immediately; (iii)
subject to the provisions of Section 6 hereof, all unvested options shall vest
immediately prior to such termination of employment to the extent that such
options would have vested from the last annual vesting anniversary date (or, if
none has yet occurred because such termination of your employment occurs prior
to the first such anniversary date, the date of grant of such stock options)
through the date of
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termination of your employment on a monthly basis, in equal installments, at the
rate of one forty-eighth (1/48) of such stock option grant per month; (iv) the
Company shall forgive all amounts owed by you in connection with the Loan and
make any necessary Gross-Up Payment; (v) the Company shall pay to you a
severance payment, in a cash lump sum, equal to your Base Salary plus your full
annual target bonus (based upon the average percentage of historical achievement
applicable to the 2001 and later calendar years or, if such termination of
employment shall occur either during the 2001 calendar year or by reason of a
Change of Control or other Good Reason with respect to any calendar year, one
hundred percent (100%) of the full target bonus for such calendar year) as
follows:
time of termination number of months' severance payment
--------------------------------------------------------------
1/3/2001 - 11/30/2001 24 months
12/1/2001 - 6/30/2002 18 months
7/1/2002 and beyond 12 months;
provided, however, that in the event that the termination is a result of a
Change of Control (whether due to termination without Cause or your termination
for Good Reason following a Change of Control) the amount of such severance
payment shall be no less than 18 months' severance; and (vi) the Company shall
be responsible for all costs relating to maintaining your Health Care Coverage
for you and your dependents under COBRA for the longer of the amount of months
to which the severance payment applies as set forth in subsection (d) or for so
long as allowed by law.
6. Change of Control. Notwithstanding anything to the contrary contained
herein, in the event of a Change of Control of the Company, then (i) all options
which have vested shall continue to be exercisable in accordance with the
Company's stock option plan and applicable legal requirements; (ii) fifty
percent (50%) of the unvested Time-Vested Options shall vest immediately prior
to the Change of Control (it being understood and agreed that the Board may
increase at any time such percentage vesting upon the occurrence of a Change of
Control); (iii) the Company shall forgive all amounts owed by you in connection
with the Loan and make any necessary Gross-Up Payment; (iv) to the extent that
such Change of Control results in your termination, whether by the Company
without Cause or by you for Good Reason, the Company shall pay to you a
severance payment in accordance with the provisions of Section 5(d) above.
Notwithstanding the foregoing, to the extent that the acceleration of vesting as
contemplated in clause (ii) above shall cause the options to not qualify as
incentive stock options under applicable tax laws, you shall be entitled to
require that the Company not accelerate the vesting of all or part of your
unvested stock options in such manner as shall preserve the status of the
options as incentive stock options.
7. Non-Disclosure/Invention Assignment Agreement. You agree to enter
into the Company's standard Non-Disclosure and Invention Assignment Agreement
upon commencing employment hereunder, in the forms of Attachment A and
Attachment B hereto.
8. Directors' and Officers' Liability Policy. You will be covered
under the Company's directors' and officers' liability insurance policy, which
shall provide coverage in an amount and upon terms customary to similarly
situated companies. The Company shall maintain such policy throughout the
duration of your employment.
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9. Expenses associated with this Agreement. The Company shall
reimburse you for all expenses incurred by you in the preparation, review and
negotiation of this Agreement, including, without limitation, reasonable
attorneys' fees and accountants' fees.
10. Indemnification. The Company agrees that if you are made a party
or are threatened to be made a party to any action, suit or proceeding, whether
civil, criminal, administrative or investigative (a "Proceeding"), by reason of
the fact that you are or were a director or officer of the Company or any
subsidiary or affiliate of the Company, whether or not the basis of such
Proceeding is alleged action in an official capacity as a director, officer,
employee or agent, you shall be indemnified and held harmless by the Company to
the fullest extent authorized by Delaware law, as the same exists or may
hereafter amended, against all damages, losses, judgments, liabilities, fines,
penalties, excise taxes, settlements and costs, including reasonable attorneys'
fees, accountants' fees and disbursement, incurred or suffered by you in
connection therewith (including the advancement of your defense costs and
expenses as and when incurred) and such indemnification shall continue as to you
even if you have ceased to be an officer, director or agent and are no longer
employed by the Company and shall inure to the benefit of your heirs, executors
and administrators.
11. Assignment. This Agreement shall be binding upon and inure to
the benefit of (a) your heirs, executors and legal representatives upon your
death and (b) any successor of the Company. Any such successor of the Company
shall be deemed substituted for the Company under the terms of this Agreement
for all purposes. For this purpose, "successor" means any person, firm,
corporation or other business entity which at any time, whether by purchase,
merger or otherwise, directly or indirectly acquires all or substantially all of
the assets or business of the Company.
12. Notices. All notices, requests, demands and other communications
provided hereunder shall be in writing and shall be deemed given (i) on the date
of delivery if delivered personally, (ii) one (1) day after being sent by a well
established commercial overnight service, or (iii) four (4) days after being
mailed by registered or certified mail, return receipt requested, prepaid and
addressed to the parties or their successors at the following addresses, or at
such other addresses as the parties may later designate in writing:
If to the Company:
RIBOZYME PHARMACEUTICALS, INC.
0000 Xxxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Chairman of the Board
If to you:
at the last residential address known by the Company.
13. Severability. In the event that any provision hereof becomes or
is declared by a court of competent jurisdiction to be illegal, unenforceable or
void, this Agreement shall continue in full force and effect without said
provision.
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14. Integration. This Agreement, together with the Non-Disclosure and
Invention Assignment Agreement represents the entire agreement and understanding
between the parties as to the subject matter herein and supersedes all prior or
contemporaneous agreements whether written or oral. No waiver, alteration, or
modification of any of the provisions of this Agreement shall be binding unless
in writing and signed by duly authorized representatives of the parties hereto.
15. Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of Colorado, without reference to
principles of conflict of laws.
16. Expiration Date. This offer set forth in this letter agreement
will expire on January 5, 2001, unless you have signed this letter agreement
where indicated below and returned it to the undersigned before the close of
business on such date.
Please sign this agreement and return one signed original copy to me,
acknowledging your agreement with and acceptance of these terms of employment.
Sincerely,
RIBOZYME PHARMACEUTICALS, INC.
By: /s/ Xxxxx X. Xxxxxxxxxxxxxx
------------------------------------
Xxxxx X. Xxxxxxxxxxxxxx, Ph.D.
CEO and President
Agreed and accepted:
/s/ Xxxxxx X. Xxxxx
--------------------------------
Xxxxxx X. Xxxxx
Dated: January 4, 0000
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Xxxxxxxx 1
DEFINITIONS
Cause. "Cause" is defined as (i) conviction of a felony crime involving
moral turpitude, (ii) an intentional action or intentional failure to act which
was performed in bad faith and to the material detriment of the Company, (iii)
continued intentional refusal or intentional failure to act in accordance with
any lawful and proper direction or order of the Board, (iv) willful and habitual
neglect of the duties of employment, or (v) breach of the Non-Disclosure
Agreement, contemplated hereunder; provided, however, that with respect to the
events of "cause" described under clauses (ii) through (v) above, the Company
shall have first provided to you written notice describing the nature of the
event and, thereafter, provided a reasonable opportunity to cure such event,
which reasonable opportunity shall in no event be less than thirty (30) days
following receipt of such notice.
Change of Control. "Change of Control" of the Company is defined as: (i)
any "person" (as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended) becomes the "beneficial owner" (as defined in
Rule 13d-3 under said Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the total voting power represented
by the Company's then outstanding voting securities; or (ii) the consummation of
a merger or consolidation of the Company with any other corporation that has
been approved by the stockholders of the Company, other than a merger or
consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) more than fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation, or the stockholders
of the Company approve a plan of complete liquidation of the Company; or (iii)
the consummation of the sale or disposition by the Company of all or
substantially all the Company's assets; or (iv) when the individuals who on the
date hereof constitute the Board and any new director (other than a director
designated by a person or entity who has entered into an agreement to effect a
transaction described in clause (ii) or (iii) above), whose nomination and/or
election to the Board was approved by a vote of at least a majority of the
directors still in office who either were directors on the date hereof or whose
election or nomination for election was previously approved, cease for any
reason to constitute a majority of the Board.
Good Reason. "Good Reason" is defined as your voluntary resignation from
your employment with the Company upon the occurrence of any of the following
without your express written consent: (i) the assignment to you of any duties or
responsibilities inconsistent with the scope of the duties or responsibilities
associated with your titles or positions or any diminution to or adverse change
of your titles, positions, status or circumstances of employment; (ii) a
reduction by the Company in your Base Salary or bonus target percentage or,
absent a good business reason, of the facilities, benefits and perquisites
available to you immediately prior to such reduction; (iii) the taking of any
action by the Company which would adversely affect your participation in, or
reduce your benefits under, the Company's benefit plans (including equity
benefits) as of the date of execution hereof, except to the extent that the
benefits of all other employees of the Company are
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similarly reduced; provided, that regardless of whether the Company may
similarly reduce the benefits of other employees, it shall constitute Good
Reason in the event the Company takes any action which would adversely affect
your participation in, or adversely affect or reduce in any material aspect your
benefits under, the Company's medical, dental, short-term disability and/or
long-term disability benefit plans or arrangements; (iv) a relocation of your
principal office to a location more than thirty (30) miles from Boulder,
Colorado, except for reasonable periods of required travel on Company business;
(v) any breach by the Company of any material provision of this Agreement; (vi)
the occurrence of a Change of Control, provided that your resignation occurs
within the first six (6) months following the Change of Control; or (vii) any
failure by the Company to obtain the assumption of this Agreement in writing by
any successor or assign of the Company.
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