Exhibit 10.10
AFFYMAX, INC.
EMPLOYMENT
AGREEMENT
This EMPLOYMENT AGREEMENT
(“ Agreement ”) is entered into by and
between ARLENE MORRIS (“ Executive
”) and AFFYMAX, INC. (the “
Company ”), effective as of December 17,
2008 (the “ Effective Date ”).
WHEREAS , the Company retains the services of Executive
pursuant to that certain Employment Agreement dated June 10,
2003 (the “ Employment Agreement ”) and
the Company and Executive hereby wish to amend and restate the
Employment Agreement in its entirety as provided herein;
WHEREAS , the Company desires to continue to employ
Executive to provide personal services to the Company, and wishes
to continue to provide Executive with certain compensation and
benefits in return for her services;
WHEREAS , Executive wishes to continue to be employed by
the Company and provide personal services to the Company in return
for certain compensation and benefits;
NOW, THEREFORE
, in consideration of the mutual
promises and covenants contained herein, it is hereby agreed by and
between the parties hereto as follows:
1.
EMPLOYMENT BY THE
COMPANY.
1.1
Position.
Subject to terms set forth herein,
the Company agrees to continue to employ Executive in the position
of Chief Executive Officer (“ CEO ”) and
Executive hereby continues to accept such employment which
commenced as of July 9, 2003 (the “ Employment
Date ”). During the term of her employment with
the Company, Executive will devote her best efforts and
substantially all of her business time and attention to the
business of the Company (except for vacation periods and reasonable
periods of illness or other incapacity as permitted by the
Company’s general employment policies). The Company
will provide Executive with reasonable administrative support, and
agrees to offer employment to Executive’s current
administrative assistant.
1.2
Duties and
Location. Executive
shall perform such duties as are customarily associated with her
position as CEO, consistent with the bylaws of the Company and as
required by the Company’s Board of Directors (the “
Board ”). Executive will report to the
Board. Executive’s primary office location shall be the
Company’s corporate headquarters, currently located in Palo
Alto, California. The Company reserves the right to
reasonably require Executive to perform her duties at places other
than its corporate headquarters from time to time, and to require
reasonable business travel.
1.3
Policies and
Procedures. The
employment relationship between the parties shall be governed by
the general employment policies and practices of the Company, which
the Company may change from time to time, and Executive will be
expected to abide by such Company policies and
practices.
2.
COMPENSATION AND
BENEFITS.
2.1
Base Salary.
As of the Effective Date,
Executive shall receive, for services to be rendered hereunder, a
base salary at an annualized rate of $511,218, less standard
payroll deductions and withholdings and payable in accordance with
the Company’s regular payroll schedule. Such salary
shall be reviewed annually and may be increased as approved by the
Board.
2.2
Bonus Potential.
Executive shall be eligible
to receive an annual incentive bonus to be paid less standard
payroll deductions and withholdings. The Board will
reasonably determine the amount of the bonus, if any, based on the
Company’s attainment of specific corporate objectives and on
Executive’s attainment of personal objectives, to be
established in the reasonable discretion of the Board after
consultation with Executive. As of the Effective Date,
Executive’s target bonus potential will be fifty percent
(50%) of Executive’s base salary. Each year, the Board
will determine Executive’s target bonus potential as a
percentage of Executive’s base salary.
2.3
Equity Awards
. The Board will grant equity
awards to Executive in its sole discretion.
2.4
Employee Benefits.
Executive shall be entitled
to all benefits, including but not limited to health and disability
benefits, for which Executive is eligible under the terms and
conditions of the standard Company benefits plans which may be in
effect from time to time and provided by the Company to its
officers. Details about these benefits are set forth in
summary plan descriptions and other materials available to
Executive. In addition, Executive will accrue paid time off
at the rate of five (5) weeks per full year of employment, in
accordance with the terms, conditions and limitations of the
Company’s paid time off policies. Executive will begin
to accrue paid time off effective as of the Employment
Date.
2.5
Prior Employment
Agreement. The Company acknowledges the
obligations to Executive pursuant to Sections 2.2 (Bonus
Potential), 2.3 (Signing Bonus), 2.4 (Stock Option Grant) and 2.5
(Employee Benefits) of the Employment Agreement.
3.
PROPRIETARY INFORMATION
AGREEMENT.
As a condition of her employment,
Executive agrees to execute and abide by the Company’s
Proprietary Information and Inventions Agreement (the “
Proprietary Information Agreement ”) attached
hereto as Exhibit A.
4.
OUTSIDE
ACTIVITIES.
4.1
Non-Company
Activities. Except
with the prior written consent of the Board, 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 Executive is a passive investor, provided that Executive
agrees not to become engaged in any other business activity which,
in the reasonable judgment of the Board, is likely to interfere
with Executive’s ability to discharge her duties and
responsibilities to the Company. Executive may engage
in
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civic and not-for-profit activities, and
participate in trade or professional organizations, so long as such
activities do not materially interfere with the performance of her
duties hereunder.
4.2
No Adverse
Interests. Except
as permitted by Section 4.3, during her employment Executive
agrees not to acquire, assume, participate in, or render services
to, 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.
4.3
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, 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 known by her to compete 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 anything above to the contrary notwithstanding,
Executive may own, as a passive investor, securities of any
competitor 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.
5.
NONINTERFERENCE.
While employed by the Company, and
for one (1) year immediately following the employment
termination date, Executive agrees not to interfere with the
business of the Company by directly or indirectly soliciting,
inducing, encouraging, or otherwise causing any employee of the
Company to terminate his or her employment in order to become an
employee, consultant or independent contractor to or for any other
person or entity.
6.
THIRD PARTY AGREEMENTS AND
INFORMATION. Executive represents and warrants that
Executive’s employment by the Company will not conflict with
any prior employment or consulting agreement or other agreement
with any third party, and that Executive will perform her duties to
the Company without violating any such agreement. Executive
represents and warrants that Executive does not possess
confidential information arising out of prior employment,
consulting, or other third party relationships, which would be
utilized in connection with Executive’s employment by the
Company, except as expressly authorized by that third party.
During Executive’s employment by the Company, Executive will
use in the performance of Executive’s duties only information
which is generally known and used by persons with training and
experience comparable to Executive’s own, common knowledge in
the industry, otherwise legally in the public domain, or obtained
or developed by the Company or by Executive in the course of
Executive’s work for the Company.
7.
TERMINATION OF
EMPLOYMENT.
7.1
At-Will Relationship.
Executive’s employment
relationship is at-will. Either Executive or the Company may
terminate the employment relationship at any time, with or without
cause or advance notice.
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7.2
Involuntary Termination. In the event of an Involuntary Termination
(defined below), and provided that Executive first properly
executes and does not revoke or attempt to revoke a general release
of all known and unknown claims in favor of the Company, and its
affiliates, employees, and agents in a form acceptable to the
Company, Executive shall be entitled to receive the following
severance benefits (the “ Severance Benefits
”): (i) a lump sum cash severance payment equal to
twelve (12) months of Executive’s then current annual base
salary, less applicable withholdings and deductions; (ii) if
Executive timely elects continued Company-provided group health
insurance coverage pursuant to the federal COBRA law, the Company
will pay Executive’s COBRA premiums sufficient to maintain
her group health insurance coverage in effect as of the date of the
Involuntary Termination for twelve (12) months following the
Involuntary Termination, provided that the Company’s
obligation to continue to pay Executive’s COBRA premiums
hereunder will cease upon Executive’s eligibility for group
health insurance coverage through a new employer; and
(iii) Executive will have the ability to exercise any vested
stock option shares granted to Executive by the Company until one
(1) year following the date of the Involuntary Termination or
the expiration of the term of any such option, whichever occurs
earlier. Executive’s entitlement to receive the
Severance Benefits is not conditioned on the occurrence of a
Corporate Transaction.
7.3
Other Resignation or Termination. If Executive’s employment ends due to a
resignation or termination that does not qualify as an Involuntary
Termination, Executive shall be entitled to receive her base
salary, and her accrued but unused paid time off earned through the
date of termination; and Executive will not be entitled to receive
any additional compensation or benefits (including the Severance
Benefits), with the exception of any vested rights she may have
under the terms of a written ERISA-qualified benefit plan (
e.g. , 401(k) account).
7.4
Termination for Death or Disability. If
Executive’s employment terminates due to Executive’s
death or Disability (defined below), Executive will be entitled to:
(i) receive any accrued but unused paid time off and salary
earned through the date of termination of employment; (ii) the
vesting of Executive’s then-outstanding equity awards will be
accelerated so that upon the termination, Executive is vested in an
additional twenty-five percent (25%) of the shares subject to such
equity awards, if any such amount remains unvested; and
(iii) Executive will have the ability to exercise any of
Executive’s vested stock option shares until one
(1) year following the termination date or the expiration of
the term of any such option, whichever occurs earlier. In
such event, Executive shall be entitled to no additional
compensation or benefits (including the Severance Benefits), except
as may be required by law or in accordance with the Company’s
benefit plans. In the event that Executive’s employment
is terminated due to Disability, the benefits provided under this
Section 7.4 shall be conditioned upon the Company’s
receipt of a general release, which Executive has executed and does
not revoke or attempt to revoke, of all claims known and unknown,
in favor of the Company and its affiliates, employees, and agents,
in a form acceptable to the Company.
7.5
Involuntary Termination Following a Corporate
Transaction. In the
event of an Involuntary Termination within twelve (12) months
immediately following a Corporate Transaction (defined below), in
lieu of the Severance Benefits (provided in Section 7.2
herein), Executive will receive the following benefits
(the
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“ Corporate Transaction
Benefits ”): (i) a lump sum cash severance
payment equal to eighteen (18) months of Executive’s then
current annual base salary, less applicable withholdings and
deductions; (ii) a lump sum cash severance payment equal to
one and a half (1½) times Executive’s annual target
bonus potential, less applicable withholdings and deductions;
(iii) if Executive timely elects continued Company-provided
group health insurance coverage pursuant to federal COBRA law, the
Company will pay Executive’s COBRA premiums sufficient to
maintain her group health insurance coverage in effect as of the
date of the Involuntary Termination for twelve (12) months
following the Involuntary Termination, provided that the
Company’s obligation to continue to pay Executive’s
COBRA premiums hereunder will cease immediately upon
Executive’s eligibility for equivalent group health insurance
coverage through a new employer; (iv) Executive will have the
ability to exercise any vested stock option shares granted to
Executive by the Company until one (1) year following the date
of the Involuntary Termination or the expiration of the term of any
such option, whichever occurs earlier; and (v) the vesting of
all of Executive’s outstanding equity awards shall be
accelerated so that they vest in full and the Company’s right
to repurchase any earlier exercised shares, if applicable, shall
lapse. As a condition precedent to Executive’s receipt
of the Corporate Transaction Benefits, Executive must properly
execute, and not revoke or attempt to revoke, a general release of
all known and unknown claims in favor of the Company, and its
affiliates, employees, agents, and successors in a form acceptable
to the Company or the successor entity, as applicable.
7.6
Definitions. For
the purposes of this Agreement, the following definitions shall
apply:
(a)
Corporate Transaction. A “Corporate
Transaction” shall mean any of the following:
(i)
a merger, consolidation or other
reorganization approved by the Company’s stockholders,
unless securities representing more than fifty percent (50%)
of the total combined voting power of the voting securities of the
successor corporation are immediately thereafter beneficially
owned, directly or indirectly and in substantially the same
proportion, by the persons who beneficially owned the
Company’s outstanding voting securities immediately prior to
such transaction;
(ii)
the sale, transfer or other
disposition of all or substantially
