Exhibit
10.1
CHANGE IN CONTROL
AGREEMENT
This AGREEMENT
is entered into by and between Targeted Genetics Corporation
(“Company”), and David J. Poston
(“Executive”), to be effective on the date executed by
both parties below.
WHEREAS,
Company employs Executive as its Vice President Finance and Chief
Financial Officer; and
WHEREAS,
Company wishes to provide for certain benefits for Executive in the
event of a Change in Control of Company resulting in the
termination of Executive’s employment; and
NOW, THEREFORE,
for good and valuable consideration, the sufficiency of which is
hereby acknowledged, the parties agree as follows:
1.
Prior
Agreement . This Agreement revokes and supersedes the
Employee Change In Control Agreement between Executive and Company
dated August 9, 1999 which shall be of no further force and
effect.
2.
Term of Agreement and
Termination . This Agreement shall be in force and effect only
from its effective date until the expiration of twelve months after
the occurrence of any Change in Control as defined in section 5(A),
unless sooner terminated as provided herein. The Agreement may be
terminated prior to a Change in Control by either party giving
thirty (30) days’ prior written notice to the other party,
provided that such notice shall have no force or effect in the
event of the occurrence of a Change in Control prior to the
effective date of such notice. The Agreement will automatically
terminate upon the death of the Executive.
3.
Continued
Benefits .
Executive shall be entitled to the following payments and benefits
following a Change in Control, whether or not a Termination
occurs:
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A.
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Executive shall
(i) receive an annual base salary no less than the
Executive’s annual base salary in effect immediately prior to
the date that the Change in Control occurs, and a bonus equal to at
least the aggregate amount of the bonus, if any paid to Executive
in the year prior to the Change in Control, and (ii) be
entitled to participate in all employee expense reimbursement,
incentive, savings and retirement plans, practices, policies and
programs (including any Company plan qualified under
Section 401(k) of the Code) available to other peer employees
of the Company, but in no event shall the benefits provided to
Executive under this item (ii) be less favorable, in the
aggregate, than the most favorable of those plans, practices,
policies or programs in effect immediately prior to the date that
the Change in Control occurs.
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B.
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Executive’s life, disability, medical,
dental and vision benefits, plans or programs for him/herself and
his/her dependents shall continue to be at the Company's expense
(except for the amount, if any, of any required employee
contribution which would have been necessary for Executive to
contribute as an active employee under the plan or program as in
effect on the date of the Change in Control) to cover Executive
(and his or her dependents) under, or provide Executive (and his or
her dependents) with coverage under any such plans or programs, no
less favorable than, Executive’s life, disability, medical,
dental and vision benefits, plans or programs, as in effect on the
date immediately prior of the Change in Control.
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C.
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If, prior to
Termination, Executive’s employment shall be terminated by
the Company for Cause or upon expiration of this Agreement or by
Executive other than for Good Reason, Executive shall be entitled
to receive (i) his or her salary at the rate then in effect through
the date of such termination, as provided under the Company's pay
policy, and (ii) any accrued benefits for the periods of service
prior to the date of such termination. All payments under this
Section 3 are subject to applicable federal and state payroll
withholding or other applicable taxes.
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4.
Severance
Benefits . If Executive’s employment with Company
should be involuntarily terminated other than For Cause, or if
Executive should resign for Good Reason within twelve (12) months
of a Change in Control, Company will pay to Executive the following
severance benefits, on the condition that Executive signs and does
not revoke a general release of claims satisfactory to the Company
that releases Company and its agents from all of Executive’s
actual or potential claims against Company.
A.
Executive shall be paid severance
in a lump sum in the amount of (i) 1.25 times his/her annual salary
in effect at the time of the Change in Control or on the date
employment terminates, whichever is higher, plus (ii) a percentage
of Executive's annual base salary specified in
subparagraph (i) above, which percentage is equal to the
percentage bonus paid to Executive for the fiscal year ended
immediately prior to the Change in Control; provided ,
however , that if Termination occurs prior to the
determination of such percentage for a fiscal year that has ended
or if Executive has not received a percentage bonus in the previous
year, such percentage shall be ten percent (10%). All payments
under this Section 4(A) (the "Termination Payments") shall be
less lawfully required withholding and, subject to Section 4(C),
will be paid within ten (10) business days following the date of
Termination or the date of execution of the Release of Claims,
whichever is later.
B.
Executive’s medical, dental and vision
benefits for him/herself and his/her dependents may be continued in
accordance with COBRA, on the same terms as the Company provides
them immediately prior to the termination. Company will pay the
premium for such COBRA continuation for the first year after
termination, provided however, that if Executive obtains comparable
coverage through another employer or otherwise, s/he will inform
the Company promptly and the Company may discontinue COBRA
coverage.
C.
This Agreement is not intended to constitute a
“nonqualified deferred compensation plan” within the
meaning of Section 409A of the Internal Revenue Code of 1986, as
amended (the “Code”). Notwithstanding the foregoing, in
the event this Agreement or any compensation or benefit paid to
Executive hereunder is deemed to be subject to Section 409A of the
Code, Executive and the Company agree to negotiate in good faith to
adopt
